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Papua New Guinea: Multitranche Financing Facility - Highlands Region Road Improvement Investment Program

Sovereign (Public) Project | 40173-013 Status: Active

The Investment Program focuses on the Highlands core road network (HCRN) of 2,500 kilometers (km) of major national and some provincial roads, which carry the bulk of the traffic in the region. The Investment Program will include (i) projects to improve about 1,400 km of the HCRN, to be funded through four or more tranches under this multitranche financing facility (MFF); (ii) design and supervision of road improvement works, preparation and administration of long-term road maintenance contracts for the entire 2,500 km of the HCRN, and capacity development of road agencies; and (iii) monitoring the socioeconomic benefits of the improved and maintained roads in the Highlands region. Support will also be provided for policies such as road user charges (to increase the resources available for road maintenance). In addition, technical assistance (TA) will be provided to support the Department of Transport to prepare a new National Transport Development Plan (NTDP) for 2011- 2020.

 
Project Name Multitranche Financing Facility - Highlands Region Road Improvement Investment Program
Project Number 40173-013
Country Papua New Guinea
Project Status Active
Project Type / Modality of Assistance Grant
Loan
Source of Funding / Amount
MFF Facility Concept 0029-PNG: Multitranche Financing Facility - Highlands Region Road Improvement Investment Program
concessional ordinary capital resources lending / Asian Development Fund US$ 260.59 million
Ordinary capital resources US$ 139.41 million
TA 7214-PNG: Multitranche Financing Facility - Highlands Region Road Improvement Investment Program
Japan Special Fund US$ 700,000.00
MFF Facility Concept: Multitranche Financing Facility - Highlands Region Road Improvement Investment Program
European Union US$ 19.99 million
Strategic Agendas Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Transport / Road transport (non-urban)

Gender Equity and Mainstreaming Some gender elements
Description The Investment Program focuses on the Highlands core road network (HCRN) of 2,500 kilometers (km) of major national and some provincial roads, which carry the bulk of the traffic in the region. The Investment Program will include (i) projects to improve about 1,400 km of the HCRN, to be funded through four or more tranches under this multitranche financing facility (MFF); (ii) design and supervision of road improvement works, preparation and administration of long-term road maintenance contracts for the entire 2,500 km of the HCRN, and capacity development of road agencies; and (iii) monitoring the socioeconomic benefits of the improved and maintained roads in the Highlands region. Support will also be provided for policies such as road user charges (to increase the resources available for road maintenance). In addition, technical assistance (TA) will be provided to support the Department of Transport to prepare a new National Transport Development Plan (NTDP) for 2011- 2020.
Project Rationale and Linkage to Country/Regional Strategy

The Highlands region is a major contributor to the PNG economy through its agricultural and mineral exports. It is also home to 40% of the country's population, who rely almost exclusively on the road network for movement of people and goods. The road network is vulnerable because of the mountainous terrain, the fragile geological conditions, and the climate. The Government and its development partners have invested significantly in improving the road network, but a lack of regular maintenance has left the network in a poor condition. There is a need to (i) initiate a program of regular maintenance on all HCRN roads that are in good condition, and (ii) improve those HCRN roads that are in a poor condition and ensure that routine maintenance begins on these roads as soon as the improvement works are done.

The current NTDP provides a framework of policies and strategies for a sustainable road system in PNG. It has led to the establishment of the National Road Authority (NRA) with responsibility for maintaining the road network and a road fund financed through road user charges to finance road maintenance. The NRA and the road fund are managed by an independent board, with representatives from road users, the private sector, and the Government. There is a need to translate these initiatives into a workable system by (i) strengthening the NRA's capacity to plan and manage road maintenance works, (ii) seeking more financing for the road fund by rationalizing road user charges, and (iii) awarding long-term performance-based road maintenance contracts. With a functioning board and staff recruitment for the NRA underway, the Government is keen to support the MFF. It will help to enable implementation of the NTDP and to ensure a sustainable road system in the Highlands region. This initiative could serve as model for other regions of PNG.

Impact The proposed Investment Program will establish a sustainable road system in the Highlands region that will enable maximum use of its natural, mineral, and human resources. It will contribute to the Government's MTDS, 2005-2010 objectives of (i) export-driven economic growth; (ii) rural development, and poverty reduction; (iii) good governance; and (iv) promotion of sustainable agriculture, forestry, fisheries and tourism.
Project Outcome
Description of Outcome Investment Program will improve access to ports, markets, and livelihood opportunities, and reduce travel time and transport costs in the Highlands region.
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

The Investment Program focuses on the Highlands core road network (HCRN) of 2,500 km of major national and some provincial roads. The HCRN carries the bulk of the traffic in the region. The Investment Program will include (i) investment projects covering improvements to about 1,400 km of HCRN (Appendix 4) to be funded through four or more tranches; (ii) consulting services for (a) preparation of investment projects for ADB approval and design and supervision of civil works, and (b) preparation and administration of long-term road maintenance contracts for the entire 2,500 km of HCRN;

(iii) support for capacity development, resource mobilization for maintenance funds, and improving road transport services; and (iv) monitoring the socioeconomic benefits of improved and maintained roads in the Highlands region. In addition, technical assistance is provided to support the DOT to prepare a new National Transport Development Plan (NTDP) for 2011-2020.

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location
Safeguard Categories
Environment B
Involuntary Resettlement B
Indigenous Peoples B
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services

Consulting services will be required for Investment Program implementation support and capacity development. Key tasks include (i) design of road improvement works; (ii) preparation of bid documents, procurement support, and supervision of road improvement and long-term maintenance contracts; (iii) Investment Program performance management; (iv) preparation of subsequent projects; (v) capacity development; and (vi) socio economic monitoring. The capacity development component will involve the strengthening of HRMG, establishment of PIU in NRA, financial/road maintenance contracting/road user charges for NRA, and road safety for NRSC.

Project 1 will require a total of 1,266 person-months (362 international and 904 national) of services from consulting firms. Additional consulting services, if necessary, will be procured under subsequent projects. The consulting services will be financed from the ADB loans. DOW will select and engage the consultants in accordance with ADB's Guidelines on the Use of Consultants (2007, as amended from time to time) using the quality- and cost-based selection method.

Procurement All ADB-financed procurement for goods and services will be carried out in accordance with ADB's Procurement Guidelines (2007, as amended from time to time). International competitive bidding procedures will be followed for all contracts over $3 million for civil works and $0.5 million for goods. National competitive bidding will be used for contracts under these thresholds. Shopping can be used for goods with contract values lower than $100,000, as appropriate. Contracts have been packaged to attract international contractors as well as promote the national contractors.
Responsible ADB Officer David Hill
Responsible ADB Department Pacific Department
Responsible ADB Division Papua New Guinea Resident Mission
Executing Agencies
Department of Works and Implementation
P.O. Box 1108
Boroko, NCD
Papua New Guinea
Timetable
Concept Clearance 13 Jun 2008
Fact Finding 16 Jun 2008 to 30 Jun 2008
MRM 15 Aug 2008
Approval 16 Dec 2008
Last Review Mission -
PDS Creation Date 03 Jul 2008
Last PDS Update 21 Jul 2008

MFF Facility Concept 0029-PNG

Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 600.00 Cumulative Contract Awards
ADB 400.00 - 0.00 0.00 %
Counterpart 200.00 Cumulative Disbursements
Cofinancing 0.00 - 0.00 0.00 %

TA 7214-PNG

Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
700,000.00 0.00 175,000.00 0.00 0.00 0.00 875,000.00 - 0.00

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

No tenders for this project were found.

Contracts Awarded

Contract Title Approval Number Contract Date Contractor Contractor Address Executing Agency Contract Description Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
CONSTRUCTION SUPERVISION Loan 3408 03 Oct 2017 RENARDET S.A CONSULTING ENGINEER UNIT 2315 CITYLAND, 10 TOWER 1 156H, DELA COSTA STR,MAKATI CITY PHILIPPINES Department of Works 3,139,548.00 1,129,984.00
IMPROVEMENT WORKS FOR NIPA MUNIHU CSTB 3531 Loan 3404 04 Jul 2017 CHINA OVERSEAS ENGINEERING GROUP CO. LTD PRC CHINA,PEOPLE'SREP.OF Department of Works Construction 28,914,793.00 7,882,906.00
IMPROVEMENT WORKS FOR NIPA-MUNIHU CSTB 3531 Loan 3408 04 Jul 2017 CHINA OVERSEAS ENGINEERING GROUP CO. LTD. PRC CHINA,PEOPLE'SREP.OF Department of Works Construction 28,914,793.00 12,875,414.00
Construction Supervision Consultants Under Tranche 2 Loan 3077 15 Jun 2017 Renardet S. A. Consulting Engineers Unit 2315, Cityland, 156H V. Dela Costa Street, Selcedo Village, Makati City, Philippines Department of Works Consulting Services 3,200,376.00 3,200,376.00
CSTB 3533 Improvement Works for Henganofi-Nupuru Road Loan 3404 31 May 2017 China Wu Yi Limited China, People's Rep. of Department of Works Construction 23,218,495.00 6,965,548.00
CSTB 3530 Improvement Works for Gewa Gembogl Road Loan 3404 31 May 2017 China Harbour Engineering Co. Ltd. China, People's Rep. of Department of Works Construction 31,353,051.00 9,405,915.00
CSTB 3533 Improvement Works and LTPBMS for Henganofi-Nupuru Road Loan 3408 31 May 2017 China Wu Yi Limited China, People's Rep. of Department of Works Construction 23,218,495.00 11,377,063.00
CSTB 3530 Improvement Works for Gewa-Gembogl Road Loan 3408 31 May 2017 China Harbor Engineering China, People's Rep. of Department of Works Construction 311,887,072.00 15,362,995.00