Palau : North Pacific Regional Connectivity Investment Project
The North Pacific Regional Connectivity Investment Project is included in the Country Operations Business Plan: Palau, 2014-2016 which was approved by Management on 21 October 2013. The total project cost is estimated at $45.0 million equivalent. ADB will finance $22.5 million comprising $13.97 million from ADB's ordinary capital resources and $8.53 million from Asian Development Funds resources. It does not include a separate project preparatory technical assistance. Therefore, project preparatory activities will be divided between ADB and the World Bank. ADB activities include economic, social, and safeguards assessments and will be covered by TA 8257-REG: Results-Based Strategy and Sector Planning in the Pacific with allocated budget of $325,000 and PARD Staff Consultant inputs.
Project Details
-
Project Officer
Bhattacharya, Sibesh
Pacific Department
Request for information -
Country/Economy
Palau -
Sector
- Information and communication technology
| Project Name | North Pacific Regional Connectivity Investment Project | ||||||||
| Project Number | 46382-001 | ||||||||
| Country / Economy | Palau |
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| Project Status | Active | ||||||||
| Project Type / Modality of Assistance | Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth Regional integration |
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| Drivers of Change | Governance and capacity development Private sector development |
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| Sector / Subsector | Information and communication technology / ICT infrastructure |
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| Gender | No gender elements | ||||||||
| Description | The North Pacific Regional Connectivity Investment Project is included in the Country Operations Business Plan: Palau, 2014-2016 which was approved by Management on 21 October 2013. The total project cost is estimated at $45.0 million equivalent. ADB will finance $22.5 million comprising $13.97 million from ADB's ordinary capital resources and $8.53 million from Asian Development Funds resources. It does not include a separate project preparatory technical assistance. Therefore, project preparatory activities will be divided between ADB and the World Bank. ADB activities include economic, social, and safeguards assessments and will be covered by TA 8257-REG: Results-Based Strategy and Sector Planning in the Pacific with allocated budget of $325,000 and PARD Staff Consultant inputs. | ||||||||
| Project Rationale and Linkage to Country/Regional Strategy | The Republic of Palau has requested Asian Development Bank (ADB) to support a submarine internet cable project. Palau and the Federated States of Micronesia (FSM) have jointly initiated the project to establish broadband internet connectivity to Palau and Yap State, FSM by connecting to the major cable hub of Guam. Both countries have agreed to share the cost of the cable equally. The World Bank has agreed to provide support to FSM for the project. The proposed project will follow the World Bank technical assistance to FSM and Palau to strengthen the regulatory environment of the information and communication technology (ICT) sector. Palau is an island nation of the Micronesian group of islands in the northern Pacific with a population of roughly 20,000. Palau receives substantial assistance from the United States through the Compact of Free Association. Palau's economy is highly reliant on tourism and services, with tourism accounting for more than 20% of gross domestic product (GDP) and services representing 77%. In FY2013, GDP growth was estimated at 0.2% owing to a sharp decline in tourist arrivals and construction, demonstrating Palau's vulnerability to external shocks. The International Monetary Fund (IMF) has identified economic diversification and private sector development as the key elements required for Palau to increase growth and thus protect its economy from such shocks. The ICT sector is widely recognized as an enabler of economic growth, social stability and development. Analysis has demonstrated that increased access to ICT, particularly broadband internet services, helps to deliver improved social services such as health and education, as well as banking among others. It brings efficiency and reduces the cost of such services and in turn enables an environment conducive to private sector investments. Moreover ICT sector itself has created significant employment opportunities in many Asian countries. At present, Palau relies entirely on geo-stationary satellite links for internet connectivity. The high cost and limited international bandwidth restricts internet penetration. Moreover, the technical limitations of capacity and the delay associated with such satellites based connectivity severely limit the quality of the service. As an interim solution Palau and FSM telecom providers have separately contracted for a five-year 150 megabit (MB) per second service from a medium earth orbit satellite broadband service starting end-2014. Once the submarine cable system is operational the satellite system will complement the more reliable cable system providing back-up in case of an interruption. The proposed project will connect Palau and Yap to the international cable hub at Guam by fiber-optic submarine cable. It will provide a plentiful capacity of higher quality broadband internet at much lower cost to Palau and so make it accessible and affordable to the broader population. The cable with a capacity of multiple terabit per second will more than meet the broadband capacity needs of Palau for the foreseeable future. The project is expected to enable delivery of improved public services (including online government services, health, and education), strengthen resilience to disasters through improved monitoring and response capabilities, and support regional integration objectives of improved service delivery (in banking, tourism etc.) and trade and communications between Pacific island economies. The lower communication cost will create opportunities for the private sector. The proposed project is consistent with ADB's country operations business plan 2014-2016 for Palau and Palau's medium-term development strategy, 2009-2014. Prioritized goals of the country operations business plan and Palau's strategy are to: (i) facilitate private sector development, and (ii) improve public sector effectiveness. |
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| Impact | Access to affordable ICT infrastructure has been achieved in Palau |
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| Project Outcome | |
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| Description of Outcome | Decrease in cost and increase in quality of internet service. |
| Progress Toward Outcome | The project has already achieved its goal to provide quality internet service at an affordable price. The retail price has come down significantly with huge jump in the demand. Further improvement of the service is expected as price comes down further as demand grows. |
| Implementation Progress | |
| Description of Project Outputs | A submarine cable system connecting Palau to the international internet cable hub in Guam established. |
| Status of Implementation Progress (Outputs, Activities, and Issues) | IRU contract was signed in 2017.The system became operational in end of 2017.BSCC has established standard operating procedure and is fine tuning it as and when needed. BSCC is implementing additional access points to maintain high availability. BSCC engaged Globe Telecom of Philippines for network operation center (NOC) and Docomo Pacific of Guam to provide customer service center. |
| Geographical Location | Nation-wide |
| Safeguard Categories | |
|---|---|
| Environment | B |
| Involuntary Resettlement | C |
| Indigenous Peoples | C |
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | No private land acquisition was required. BSCC employed an independent safeguards monitoring consultant to ensure that the preparation, design, construction, implementation, operation, and decommissioning of the Project and all its facilities comply with all applicable laws and regulations of the Borrower relating to environment, health, and safety; the environmental safeguards, and all measures and requirements set forth in the IEE, the EMP and any corrective or preventive actions in the Safeguards Monitoring Report. All bids are compliant with safeguards and environmental plan. All safeguards reports have been uploaded. |
| Involuntary Resettlement | There was no need for land acquisition. |
| Indigenous Peoples | The project does not have a potential impact on indigenous peoples. |
| Stakeholder Communication, Participation, and Consultation | |
| During Project Design | Initial stakeholders were the Office of the President's FSM Telecommunications Corporation, Department of Transport and Communication, telecom operators in Palau. |
| During Project Implementation | Palau FSM Telecommunications Corporation, Department of Transport and Communication, telecom operators in Palau. |
| Business Opportunities | |
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| Consulting Services | The project preparation will require ten person-months of staff time for missions and office-based works. In addition, the preparatory and supportive capacity building activities covered by ADB technical assistance will provide 20 person-months of international consultant inputs. Procurement of equipment or consulting services covered by ADB's loan or technical assistance will conform with ADB's Procurement Guidelines (March 2013, as amended from time to time) and ADB's Guidelines on the Use of Consultants by ADB and Its Borrowers (March 2013, as amended from time to time). |
| Procurement | In Palau, the Ministry of Finance is the proposed executing agency for the project. Palau and FSM will establish a new Special Purpose Vehicle (SPV) to develop and operate the submarine cable system; it will also assume the role of implementing agency (IA). The SPV will handle all procurement and financial management. The IA would be funded by the Governments of FSM and Palau on a 50% cost sharing arrangement. Cofinancing arrangements between ADB and the World Bank, including procurement packages for works and goods and consulting services, will be detailed in the project design and described in the Project Administration Manual. Procurement of equipment or consulting services covered by ADB's loan or technical assistance will conform with ADB's Procurement Guidelines (March 2013, as amended from time to time) and ADB's Guidelines on the Use of Consultants by ADB and Its Borrowers (March 2013, as amended from time to time). |
| Responsible ADB Officer | Bhattacharya, Sibesh |
| Responsible ADB Department | Pacific Department |
| Responsible ADB Division | PATC |
| Executing Agencies |
Ministry of Finance |
| Timetable | |
|---|---|
| Concept Clearance | 13 Aug 2014 |
| Fact Finding | 18 Feb 2015 to 27 Feb 2015 |
| MRM | 07 Oct 2015 |
| Approval | 07 Dec 2015 |
| Last Review Mission | - |
| Last PDS Update | 09 Mar 2023 |
Loan 3346-PAL
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 07 Dec 2015 | 07 Mar 2016 | 08 Mar 2016 | 30 Sep 2018 | 31 Dec 2023 | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 16.47 | Cumulative Contract Awards | |||
| ADB | 16.47 | 23 Mar 2023 | 16.03 | 0.00 | 97% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 23 Mar 2023 | 15.60 | 0.00 | 95% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | Satisfactory | Satisfactory | Satisfactory | Unsatisfactory | Satisfactory |
Loan 3347-PAL
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 07 Dec 2015 | 07 Mar 2016 | 08 Mar 2016 | 30 Sep 2018 | 31 Dec 2023 | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 13.72 | Cumulative Contract Awards | |||
| ADB | 8.53 | 23 Mar 2023 | 8.09 | 0.00 | 97% |
| Counterpart | 5.19 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 23 Mar 2023 | 8.07 | 0.00 | 97% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | - | Satisfactory | Satisfactory | Satisfactory | Unsatisfactory | Satisfactory |
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.
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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.
| Title | Document Type | Document Date |
|---|---|---|
| North Pacific Regional Connectivity Investment Project: Environmental Monitoring Report (January-June 2021) | Environmental Monitoring Reports | Jul 2021 |
| North Pacific Regional Connectivity Investment Project: Environmental Management Plan | Environmental Management Plans | Sep 2016 |
| North Pacific Regional Connectivity Investment Project: Initial Environmental Examination | Initial Environmental Examination | Mar 2015 |
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.
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Tenders
| Tender Title | Type | Status | Posting Date | Deadline |
|---|---|---|---|---|
| Loan No. 3346/3347-PAL: North Pacific Regional Connectivity Investment Project [BSCC 01/18] | Invitation for Bids | Closed |
Contracts Awarded
| Contract Title | Approval Number | Contract Date | Contractor | Address | Executing Agency | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
|---|---|---|---|---|---|---|
| Ngaremlengui Civil Works | Loan 3346 | 10 Jan 2017 | Flexenclosure Ab | Eriksbergsgatan 10, S-114, 30 Stockholm, Sweden | Ministry of Finance | 299,910.00 | 197,640.69 |
| Cable Landing Station for North Pacific Regional I Investment Connectivity Project | Loan 3346 | 27 Feb 2017 | Surangel and Sons Construction Company | Po Box 295 Koror, Palau 96940 Palau | Ministry of Finance | 163,803.00 | 107,946.18 |
| Ngaremlegui Civil Works | Loan 3347 | 10 Jan 2017 | Flexenclosure Ab | Eriksbergsgatan 10, S-114, 30 Stockholm, Sweden | Ministry of Finance | 299,910.00 | 102,269.31 |
| Design, Supply, Erection, Testing and Commissioning of Madunaghat-Kalurghat 132KV Double Circuit and Reconductoring of Existing Comilla-Chandpurpb2L2 | Loan 3347 | 27 Feb 2017 | Surangel and Sons Construction Company | Po Box 295 Koror, Palau 96940 Palau | Ministry of Finance | 163,803.00 | 55,856.82 |
Procurement Plan
| Title | Document Type | Document Date |
|---|---|---|
| North Pacific Regional Connectivity Investment Project: Procurement Plan | Procurement Plans | Nov 2016 |