Mongolia: Ulaanbaatar Urban Services and Ger Areas Development Investment Program - Tranche 2

Sovereign Project | 45007-005 Status: Approved

Summary

Tranche 2 of the multitranche financing facility will (i) extend the urban infrastructure upgrading and spatial restructuring to two additional subcenters in the northern ger areas, namely Dambadarjaa and Denjiin, and provide additional investments in Selbe and Bayankhoshuu subcenters under Tranche 1; (ii) support the delivery of socioeconomic facilities; and (iii) further improve institutional strengthening and capacity building.

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Procurement Documents

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Project Name Ulaanbaatar Urban Services and Ger Areas Development Investment Program - Tranche 2
Project Number 45007-005
Country Mongolia
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Loan 3525-MON: Ulaanbaatar Urban Services and Ger Areas Development Investment Program - Tranche 2
Ordinary capital resources US$ 37.11 million
Loan 3526-MON: Ulaanbaatar Urban Services and Ger Areas Development Investment Program - Tranche 2
Concessional ordinary capital resources / Asian Development Fund US$ 29.24 million
Loan: Ulaanbaatar Urban Services and Ger Areas Development Investment Program - Tranche 2
European Investment Bank US$ 19.64 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector

Energy - Energy utility services

Transport - Urban roads and traffic management

Water and other urban infrastructure and services - Urban policy, institutional and capacity development - Urban slum development - Urban water supply

Gender Equity and Mainstreaming Effective gender mainstreaming
Description Tranche 2 of the multitranche financing facility will (i) extend the urban infrastructure upgrading and spatial restructuring to two additional subcenters in the northern ger areas, namely Dambadarjaa and Denjiin, and provide additional investments in Selbe and Bayankhoshuu subcenters under Tranche 1; (ii) support the delivery of socioeconomic facilities; and (iii) further improve institutional strengthening and capacity building.
Project Rationale and Linkage to Country/Regional Strategy

Ulaanbaatar city is home to over 1.4 million people. The central core of the city largely comprise apartment blocks with comprehensive utility services; including district heating, piped water supply, and wastewater collection and treatment. Surrounding the central core is a vast, low density, 100 square kilometers of peri-urban area (so-called ger areas) with poor infrastructure that accommodates about 60% of the city's population (approximately 800,000 inhabitants). Ger areas have spread and expanded through successive waves of migration. These settlements of low- and medium-income households are characterized by loosely aligned plots, creating irregular pathways that remain unpaved. Lack of basic urban services causes severe pollution that affects the city residents' health because of (i) unimproved individual coal stoves used by most ger area residents during winter which generate high air pollution; (ii) poor sanitation, since households almost exclusively rely on open pit latrines; (iii) poor solid waste collection which creates highly unsanitary living conditions, along with limited access to water supplied by water kiosks; and (iv) traffic congestion caused by unmanaged road network. Finally, poor basic urban services in ger areas are combined with critical lack of public space, public facilities, commercial areas, and economic amenities.

On 12 December 2013, ADB approved the Ulaanbaatar Urban Services and Ger Areas Development Investment Program using the multitranche financing facility (MFF) modality. The program supports the Ulaanbaatar city master plan in upgrading priority service and economic hubs (subcenters) in ger areas. The program will support the implementation of the Municipality of Ulaanbaatar's Master Plan 2030 by upgrading priority ger area subcenters from 2013 to 2023 through three projects. The investment program is in line with the Asian Development Bank (ADB) country partnership strategy (2012 -2016) and country operational business plan (2016) for Mongolia. Further, the program is in line with ADB''s Strategy 2020, Poverty Reduction Plan, and Urban Operational Plan 2012 -2020.

The program is geographically targeted with multisector interventions. It aims to initiate a redevelopment process in ger areas and proposes an integrated solution to respond to the urgent demand for basic urban services, respond to the ongoing densification process, and develop urban subcenters as catalysts for growth in the ger areas. Improving infrastructure within the ger area subcenters and connectivity with the city core center is critical for inclusiveness and is important to facilitate the movement of people and goods, develop urban corridors, and create clusters of subcenter. Better urban planning combined with a network of infrastructure along priority roads will initiate a structural change of subcenter urban fabric. This will (i) improve residents' access to basic urban services, public space, and socioeconomic facilities; (ii) support local economic development; (iii) allow residents and businesses to take advantage of urban economies; and (iv) provide better housing options. The changes in land use and higher urban density will improve water, sanitation, and heating services delivery.

Impact Improved living conditions in Ulaanbaatar.

Project Outcome

Description of Outcome A network of livable, competitive, and inclusive subcenters in Ulaanbaatar's ger areas.
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

roads and urban services are expanded

economic and public services in targeted areas are improved

institutional capacity for program management and urban development are strengthened through the engagement of consulting services for (a) project management and implementation support; (b) detailed design, construction supervision, and engineering services inputs on Project 3 feasibility study; and (c) subcenter planning and development, community participation, small- and medium-sized enterprise development in Dambadarjaa and Denjiin, and completion of Project 3 feasibility study.

Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location

Safeguard Categories

Environment B
Involuntary Resettlement A
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects The initial environmental examination and environmental management plan were prepared based on the detailed environmental impact assessment for Project 2 pursuant to the requirements of the Mongolian Law on Environmental Impact Assessment (2012) and ADB's Safeguard Policy Statement (2009). Public consultation meetings that identified environmental issues, concerns, and appropriate impact mitigations, were conducted to affected households and stakeholders. The environmental assessment and review framework prepared for the investment program was updated as part of detailed design of Project 1. The updated environmental assessment and review framework continues to provide guidance for screening and categorization, environmental assessment, and preparation and implementation of environmental safeguards for project subcomponents to comply with ADB's Safeguard Policy Statement (2009), and the Mongolian Law on Environmental Impact Assessment (2012). Potential environmental impacts, which are largely site-specific and short-term disturbances, arising from the construction of the different project subcomponents, are insignificant and reversible. Construction-related disturbances can be managed with standard construction practices and guidelines. Environmental management is supported by loan assurances and capacity development and institutional strengthening activities under the project. Environmental complaints will be handled in accordance with the grievance redress mechanism developed for the project.
Involuntary Resettlement One land acquisition and resettlement plan (LARP) for the four subcenters has been prepared in accordance with legislative framework of Mongolia and ADB's Safeguard Policy Statement (2009) and agreed resettlement framework. The LARP was approved on 12 December 2016. The estimated land acquisition and resettlement impact includes 555 entities (residential and commercial) and 2,156 persons who are expected to be affected by the developments in the four subcenters. The project will adopt a negotiated land acquisition and resettlement practice involving contractual agreements negotiated between the affected persons and the Land Administration Department of MUB on the basis of the Civil Code of Mongolia. The resettlement framework, applicable to all subprojects implemented under the investment program has been reviewed and updated. It now reflects the Municipality of Ulaanbaatar's recent regulation, a more harmonized grievance handling system based on existing practice, new institutional arrangements, and other provisions derived from Project 1's updated LARPs. No principle and entitlement in the original framework has been downgraded. A grievance redress mechanism has been established for Project 1 and a similar mechanism will be adopted for Project 2. All safeguards documents will be reviewed and concurred by ADB, disclosed to affected people and communities, and posted on ADB and Municipality of Ulaanbaatar websites. The program management office has adequate staff and has demonstrated capacity for grievance redress, awareness creation, and social mobilization. Safeguards trainings will continue to be provided as specified in the LARP. Social safeguards monitoring and reporting to ADB will be continued on a semiannual basis.
Indigenous Peoples The project components are all focused on mid-ger urban areas of Ulaanbaatar. These areas have been in existence for some time and are very heterogeneous in terms of residents' socioeconomic status. The project investments will benefit all residents. No specific communities of ethnic minorities have been identified.
Stakeholder Communication, Participation, and Consultation
During Project Design To ensure the positive benefits of project components; public awareness, education program, consultations, and participation activities have been designed and included in the community action plan, gender action plan, and social development action plan to be conducted during the course of the project, supported by the loan implementation consulting services. The community action plan and social development action plan were prepared to ensure continued consultation and participation of the local communities during project implementation.
During Project Implementation

Business Opportunities

Consulting Services Project 2 will require 246 person-months of international and 743 person-months of national consulting services using quality- and cost-based selection. The consultants will be engaged in accordance with ADB's Guidelines on the Use of Consultants (2013, as amended from time to time).
Procurement

International competitive bidding: 6 contracts

National competitive bidding: 5 contracts

Community participation in procurement: 1 contract

All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines.

Responsible Staff

Responsible ADB Officer Heckmann, Arnaud
Responsible ADB Department East Asia Department
Responsible ADB Division Urban and Social Sectors Division, EARD
Executing Agencies
Municipal Government of Ulaanbaatar
Sukhbaatar Square-11
Ulaanbaatar-46, Mongolia

Timetable

Concept Clearance -
Fact Finding -
MRM 19 Dec 2016
Approval 31 Mar 2017
Last Review Mission -
Last PDS Update 31 Mar 2017

Loan 3525-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
31 Mar 2017 - - 28 Feb 2022 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 91.90 Cumulative Contract Awards
ADB 37.11 31 Mar 2017 0.00 0.00 0%
Counterpart 35.15 Cumulative Disbursements
Cofinancing 19.64 31 Mar 2017 0.00 0.00 0%

Loan 3526-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
31 Mar 2017 - - 28 Feb 2022 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 29.24 Cumulative Contract Awards
ADB 29.24 31 Mar 2017 0.00 0.00 0%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 31 Mar 2017 0.00 0.00 0%

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

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