The proposed S-PPTA is needed in order to ensure due diligence is undertaken for the additional financing, especially technical and economic aspects, safeguards and social development. It will also include the incorporation of the additional project costs into the overall project financing plan and a revision of project documents to include the expanded project scope.
It is expected that, if additional financing becomes available, implementation procedures for the additional subprojects will follow current implementation procedures. For investments that may be considered, 39 subprojects have already been screened, determined to be eligible, and prioritized on a provincial basis. Moreover, draft project documents for additional financing including a draft RRP and PAM have already been prepared. However, since the original project was approved in 2007, a new safeguard policy has been instituted within ADB. Thus it is necessary to update the safeguard procedures and documents to conform to this policy. It is also proposed to fully review one of the subprojects based on the new policy so that a model is available for the remaining subprojects to be prepared and financed during the period of additional loan implementation. Furthermore, since gender issues and other social issues are closely aligned with safeguard issues, a revised gender action plan will be prepared and undertaken for the sample subproject. On the basis of this experience, the safeguard and social documents will be updated. The selected subproject will also be subjected to due diligence on its technical, economic, financial and governance aspects
In addition, it will be necessary to allocate the additional funding among funding categories (civil works, consulting services, project management, capacity building, etc.) based on experiences in implementing the original project and to adjust project documentation accordingly. A re-costing of the Project will thus be necessary, and revisions to the existing draft project documents, primarily the PAM and the RRP will also be required.
|Project Rationale and Linkage to Country/Regional Strategy
Loan 2357(SF) for the Integrated Rural Development Sector Project in the Central Provinces (IRDSPCP) was approved by ADB on 15 October 2007. The total cost of the Project was estimated at $168.2 million and is jointly financed by ADB and Agence Francaise de Developpement (AFD). The IRDSPCP is financed by a sector loan focussed on the upgrading and rehabilitation of rural infrastructure (primarily rural roads and irrigation systems, but also flood control, markets and other key infrastructure).
After some initial start-up delays, implementation progress for the Project has been fully satisfactory. As of 31 October 2012, overall project implementation progress was 76% against the elapsed loan period of 75%, while cumulative contract awards and disbursements of the ADB loan were $76.6 million and $65.4 million, equivalent to 84.0% and 71.7% of the net loan amount ($91.2 million), respectively. To date, 129 subprojects have either been completed or are nearing completion. Moreover, review missions had determined that the quality of construction of subprojects was good; that the executing agency (EA) has developed the expertise needed to effectively implement ADB projects; and that significant benefits are already accruing.
At the request of the Government, the potential for additional financing was investigated during the Mid-Term Review in 2011 and in more detail during two subsequent review missions in 2012. Specifically, review missions in May and November of 2012 identified about 39 new subprojects with a combined cost of about $130.0 million which would be eligible for inclusion in the project scope if additional financing were available.
Additional financing in the amount of $70 million has been recommended and included in the country program for ADB Board consideration in 2013 in view of this potential and the fact that an existing EA with the expertise to implement an expanded project scope is in place. Additional financing was considered justified since the project has (i) delivered expected outputs on a timely basis as measured against the output indicators in the design and monitoring framework (DMF); (ii) satisfactory implementation progress; (iii) satisfactorily complied with safeguard requirements; (iv) successfully managed and overcome the initial risks faced during implementation; and (v) an on-track rating.