Kyrgyz Republic: Water Supply and Sanitation Strategy

Sovereign Project | 46350-001

Summary

The proposed technical assistance (TA) is aimed at developing a rural WSS policy and institutional arrangement to address the weak rural Water Supply and Sanitation (WSS) sector governance, lack of rural WSS policy, poor project implementation and poor service delivery. The proposed TA will also support the creation of a robust governance framework for rural WSS. The government has recognized the above deficiencies and is still interested in improving WSS services in rural areas. The proposed TA focuses on the following four main areas:

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Project Name Water Supply and Sanitation Strategy
Project Number 46350-001
Country Kyrgyz Republic
Project Status Approved
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8375-KGZ: Water Supply and Sanitation Strategy
Technical Assistance Special Fund US$ 750,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Partnerships
Sector / Subsector Public sector management - Public administration
Water and other urban infrastructure and services - Urban water supply
Gender Equity and Mainstreaming
Description

The proposed technical assistance (TA) is aimed at developing a rural WSS policy and institutional arrangement to address the weak rural Water Supply and Sanitation (WSS) sector governance, lack of rural WSS policy, poor project implementation and poor service delivery. The proposed TA will also support the creation of a robust governance framework for rural WSS. The government has recognized the above deficiencies and is still interested in improving WSS services in rural areas. The proposed TA focuses on the following four main areas:

a. Synthesizing lessons learned for designing future development projects. A recent assessment of the rural WSS sector in the country identified various institutional, communication, and corruption issues that require to be addressed in order to ensure sustainable rural WSS service delivery. The proposed TA will build on this report by adding, to the existing lessons learned, the technical, project management and compliance perspective, experience from other development partner rural WSS projects, conducting a willingness-to-pay survey of rural population, and assessment of market for suppliers, consultants, and contractors. This will provide a more comprehensive insight into sector problems and a guide for designing future projects.

b. Capacity development of rural WSS institutions. To fill the gap in rural WSS governance, the proposed TA will support the strengthening and capacity development of institutions involved in the provision of rural WSS services. This could be done by building capacity of existing institutions or by creating new institutions. The proposed TA will: (i) define the approach to filling the governance gap; (ii) design the rural WSS institutional framework, ranging from national level institutions down to service provision at village level; (iii) define the roles and responsibilities of these institutions; (iv) design mechanisms to minimize corruption, including incentives and compensation plans; (v) define capacity development needs of institutions; and (vi) deliver training essential for the rural WSS institutions to carry out their roles and responsibilities.

c. Asses and monitor government demonstration projects. In order to improve project design and implementation, the government has identified a number of successful rural WSS subprojects that can be used as a model for future rural WSS projects. The proposed TA will assess these subprojects by: (i) conducting technical reviews of the designs and systems as constructed; (ii) gathering community feedback on the projects; and (iii) conducting a financial analysis of the projects to establish their sustainability. Furthermore, the government is planning rectification of some less successful subprojects to bring them to the same standard as the successful projects. The TA will monitor the rectification of the subprojects, including: (i) efficiency of project implementation and procurement; (ii) quality of design and construction; and (iii) technical and financial sustainability. Based on these two types of subprojects the proposed TA will identify the key success factors for rural WSS subprojects. These findings will be presented to rural WSS beneficiaries and stakeholders in a series of workshops designed to raise awareness of beneficiaries' role in making rural WSS subprojects successful. Furthermore, the identified key success factors will form the basis a rural WSS model to be used for the new rural WSS project.

d. Prepare Rural WSS Policy and assist in its implementation. The proposed TA will prepare a Rural WSS Policy, which will follow the key elements of the National WSS Strategy prepared by the World Bank. The Rural WSS Policy will include: (i) regulatory and service monitoring mechanisms (including revised water quality standards); (ii) tariff and subsidy mechanisms; (iii) revised rural WSS technical standards (i.e. compatible with standards of international water associations); (iv) operations and maintenance plans and guidelines; (v) rural WSS asset ownership regulations; (vi) standardized design approach and procurement plans for rural WSS systems; (vii) benchmarking and information gathering program, (viii) WSS professionals training plan; and (ix) sector coordination, support and knowledge sharing plan. The Rural WSS Policy will create an enabling environment for the delivery of sustainable, quality WSS services at a reasonable cost. Following ratification of the Rural WSS Policy, the proposed TA will provide the necessary training and assistance to relevant institutions to implement the policy.

Project Rationale and Linkage to Country/Regional Strategy

The Kyrgyz Republic's rural water supply and sanitation (WSS) sector has been performing poorly and issues faced by the sector are:

a. Absence of a national rural WSS Policy. There is no national WSS policy or strategy for development, coordination and organization of either rural or urban WSS sectors. Neither rural nor urban WSS sectors have been included in the Kyrgyz Republic's Medium Term Development Plan (2012-14). In the absence of government commitment to sector development, the rural WSS service levels have been continuously declining. The Taza Suu program managed to slow down and temporarily reverse the decline in service levels. However, due to lack of rural WSS policy, most of the rural WSS systems constructed or rehabilitated under the Taza Suu program are not sustainable, and many systems are already inoperable. ADB requirement to develop a sector development policy and legal and regulatory framework for rural water asset creation and service delivery, as part of the Community-Based Infrastructure Services Sector Project (CBISSP), was ignored by the government. The World Bank is currently preparing a high level participative WSS strategy that will outline the principles for reforms in the WSS sector. The World Bank plans to complete the strategy paper and action plan by May 2013.

b. Weak sector governance. The only central government agency operating in the WSS sector is the Department of Drinking Water Supply and Sewerage Development (DDWSSD), under the State Agency for Architecture, Construction and Communal Services (SAACCS). This department is responsible for development of both rural and urban WSS sectors. However, DDWSSD has low level of authority and capacity as it has been recently created after the new government took charge. In its previous forms, DDWSSD has been frequently moved between different ministries and agencies due to its role in channeling development partner funds.

c. Poor implementation of development partner projects. ADB has financed two rural WSS projects in the Kyrgyz Republic, Community Based Infrastructure Services Sector Project (CBISSP) and Community-Based Infrastructure Services Sector Project - Supplementary (CBISSP-S) Both of these projects faced major implementation difficulties.

" CBISSP implementation issues comprised: (i) cost overruns; (ii) weak administration; (iii) poor selection of subprojects; (iv) poor performance of consultants, design institutes, and contractors; (v) poor execution of works, with substandard or even second hand equipment being installed; and (vi) poor sustainability of subprojects. In order to rectify deficiencies in execution of works, improve sustainability of subprojects and meet original project targets, ADB approved supplementary financing through CBISSP-S in 2009.

" CBISSP-S implementation issues comprise: (i) integrity breaches; (ii) low capacity of government implementation staff; (iii) poor application of selection criteria to identify subprojects; (iv) unsustainable institutional model and operations and maintenance practices; (v) poor supervision and poorly executed works; and (vi) non-compliance with ADB grant covenants and frequent violations of ADB rules and procedures. Based on the findings of the Office of Anticorruption and Integrity's Project Procurement-Related Review (PPPR), ADB suspended the Grant in May 2012.

" Rural Water Supply and Sanitation (RWSS) 1 and 2 projects financed by World Bank and United Kingdom Department for International Development (DFID) faced similar implementation problems.

d. Poor service delivery. Most of the rural water supply infrastructure in the Kyrgyz Republic was built 40 to 50 years ago, during the Soviet period. Initially, the water supply systems provided reliable services. (Post-1991), the rural WSS infrastructure has deteriorated and is now in poor condition or inoperative. WSS systems built or rehabilitated through the Taza Suu Program are operated by the Community Drinking Water Users Unions (CDWUU) created in each benefitting village. Rural WSS systems that are not covered by the Taza Suu Program are operated directly by local governments. However, rural WSS services are poorly delivered because of: (i) a financing gap resulting from low revenues due to low tariff bases and poor collection; (ii) asset deterioration due to insufficient funds for maintenance and reinvestment; (iii) ineffective organization of service provision, lack of skilled personnel and reliance on outdated and inefficient construction norms and standards; and (iv) poor sector regulation and management. Overall, the rural WSS levels of service are low as shown by the indicators below (best estimates):

" Low Water Supply Coverage: 50% 60% in rural areas.

" Non-Potable Water: 2% of chemical and 10% of microbiological tests failed.

" Insufficient Hours of Supply: 4 hours to 20 hours water supply a day.

" High Water Losses: Actual level of losses is unknown, but it is estimated to be 35% 45%.

" Low Sewerage Coverage: Less than 25% of rural population has access to improved sanitation facilities.

Impact Improved rural WSS services
Project Outcome
Description of Outcome Institutional arrangement established for rural WSS services
Progress Toward Outcome Preparation of outputs is in progress. Working Group needs to be established to design the reforms with consultant guidance.
Implementation Progress
Description of Project Outputs

1. Rural WSS policy adopted

2. Capacity development program developed

3. Framework for infrastructure development and system maintenace developed

Status of Implementation Progress (Outputs, Activities, and Issues) Preparation of outputs is in progress. Working Group needs to be established to design the reforms with consultant guidance.
Geographical Location
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design Discussions held with First Vice Prime Minister, Vice Prime Minister for Real Economy, State Agency for Architecture Construction and Communal Services (SAACCS), Department of Drinking Water Supply and Sewerage Development (DDWSSD), Ministry of Finance.
During Project Implementation SAACCS, DDWSSD, Ministry of Finance, NGOs, civil society organisations, customers, Community Drinking Water Users Unions (CDWUU), local governments (including staff involved in WSS service provision) have been or will be consulted during the TA preparation. Working Group needs to be formed by the Government.
Business Opportunities
Consulting Services

Individual consultants will be engaged by ADB to implement the proposed TA, in accordance with ADB's Guidelines on the Use of Consultants (2010, as amended from time to time). Individual consultants are being used rather than a firm in order to: (i) increase speed of procurement; (ii) obtain a specific mix of skills; and (iii) eliminate any undue influence on the outputs from local design institutes. The cost estimates and financing plan are in Appendix 2. Disbursements under the TA will be made in accordance with the Technical Assistance Disbursement Handbook (2010 as amended)

A team of international consultants (21 person-months) and national consultants (18 person-months) will develop the TA outputs. Team will include four international and three national consultants. The consultants should have expertise in regulatory and institutional matters, communications, finance, economics, WSS and Kyrgyz law.

Procurement All procurement under the MFF will be carried out in accordance with ADB's Procurement Guidelines (2010, as amended from time to time).
Responsible ADB Officer Marko Davila
Responsible ADB Department Central and West Asia Department
Responsible ADB Division Urban Development and Water Division, CWRD
Executing Agencies
State Agency for Construction and Regional Dev't28,Manas Avenue,Bishkek,Kyrgyz Republic
Timetable
Concept Clearance 25 Jan 2013
Fact Finding -
MRM -
Approval 03 Jun 2013
Last Review Mission -
Last PDS Update 24 Mar 2015

TA 8375-KGZ

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
03 Jun 2013 02 Jul 2013 02 Jul 2013 30 Nov 2014 30 Jun 2016 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
750,000.00 0.00 0.00 0.00 0.00 0.00 750,000.00 03 Jun 2013 505,334.06

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