Micronesia, Federated States of: Preparing the Sustainable Road Infrastructure Investment Project

Sovereign Project | 55009-001

The proposed project readiness financing is intended to test the project approach and prepare an investment project suitable for Asian Development Bank''s financing programmed in 2023. It will prepare the ensuing investment project by: (i) screening suitable road section for piloting the advanced construction technology and subsequent selection of candidate subprojects for the ensuing investment project(s); (ii) undertaking feasibility studies and due diligence on institutional, financial, procurement, and safeguards aspects of the selected subprojects; (iii) preparing detailed engineering designs and procurement of contracts for the ensuing project, including preparation of bid documents and procurement management support; and (iv) initial capacity building to support the ensuing project's start-up activities.

Project Details

  • Project Officer
    Ishenaliev, Rustam I.
    Pacific Department
    Request for information
  • Country/Economy
    Micronesia, Federated States of
  • Sector
    • Transport
Project Name Preparing the Sustainable Road Infrastructure Investment Project
Project Number 55009-001
Country / Economy Micronesia, Federated States of
Project Status Active
Project Type / Modality of Assistance Grant
Source of Funding / Amount
Grant 6039-FSM: Preparing the Sustainable Road Infrastructure Investment Project
Asian Development Fund US$ 5.00 million
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Sector / Subsector

Transport / Road transport (non-urban) - Transport policies and institutional development - Urban roads and traffic management

Gender Equity and Mainstreaming
Description The proposed project readiness financing is intended to test the project approach and prepare an investment project suitable for Asian Development Bank''s financing programmed in 2023. It will prepare the ensuing investment project by: (i) screening suitable road section for piloting the advanced construction technology and subsequent selection of candidate subprojects for the ensuing investment project(s); (ii) undertaking feasibility studies and due diligence on institutional, financial, procurement, and safeguards aspects of the selected subprojects; (iii) preparing detailed engineering designs and procurement of contracts for the ensuing project, including preparation of bid documents and procurement management support; and (iv) initial capacity building to support the ensuing project's start-up activities.
Project Rationale and Linkage to Country/Regional Strategy

The Government of the Federated States of Micronesia (FSM) and the Asian Development Bank (ADB) prioritized support to the transport sector for the first time in ADB''s country operations business plan for 11 small Pacific island countries, 2021 2023. The FSM heavily relies on the United States and development partners for investments in the transport sector and has traditionally also received funding from the government of the People's Republic of China, international financial institutions such as the World Bank, and United Nations-affiliated organizations such as the International Organization for Migration and the Adaptation Fund. However, this assistance is insufficient to meet all of the FSM's infrastructure needs. ADB is well positioned to bridge this funding gap and strengthen the transport sector in the FSM by leveraging its unique experience and knowledge of the infrastructure constraints and opportunities in the Pacific. ADB's flexible financial instruments, such as the project readiness financing facility, will ensure that the project delivery approach is tested and the ensuing project is implementation-ready before committing scarce public resources.

The FSM''s population is served by 200 kilometers (km) of sealed and 15 km of unsealed primary roads over a combined land area of 700 square kilometers dispersed across the four semiautonomous states of Chuuk, Kosrae, Pohnpei, and Yap. Because of urban migration for job opportunities, especially to Pohnpei where the country's capital Palikir is located, about 56% of population lives on the four main islands. The remaining 44% lives on the outer islands. As is typical of many Pacific small island developing states, primary roads in the FSM provide access to public facilities, economic infrastructure, and job opportunities along the coastlines, where most of the population resides. These roads are a vital means for coastal communities to access public goods and services. Geographic remoteness and dispersion, environmental fragility, and climate change impacts pose major challenges for infrastructure delivery, and even threaten the physical viability of some areas of the main islands and the more remote outer islands of the FSM.

The government has directed the DTC&I to implement the FSM''s Pave the Nation Program to address the pressing social and economic infrastructure needs. The government accords high priority to the program and estimates that investments of more than $400 million will be needed for physical infrastructure and institutional development to support the expansion of the productive sectors, reduce poverty, and improve living standards. A post-COVID-19 economic stabilization strategy will place heavy emphasis on stimulating the construction industry as the primary engine of growth in the short term.

The World Bank approved the $40 million Prioritized Road Investment and Management Enhancement Project in 2021 to (i) improve the FSM's road network through climate resilient upgrades to primary road sections and water crossings, (ii) provide technical assistance to create an enabling environment for asset management systems, and (iii) provide planning tools for prioritizing road investments. Guided by Strategy 2030,7 ADB's support is essential to bridge the infrastructure funding gap; partner with the World Bank and other financiers to deliver coordinated assistance; and provide knowledge support for institutional, technological, and human resources development. Given that the FSM is a small island developing state and is classified as a fragile and conflict-affected situation, project development will take a country-focused approach to strengthen state ownership and effective communication between national government and states while seeking to use advanced technologies with a primary focus on building long-term sustainability for operation and maintenance of the road assets.

Impact
Project Outcome
Description of Outcome
Progress Toward Outcome
Implementation Progress
Description of Project Outputs
Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The proposed PRF will support the FSM Government prepare a road investment project suitable for ADB financing. It will however pilot on a small scale the project approach for the ensuing project on existing road footprints with an IEE being prepared to mitigate foreseen risks. It is envisaged to have very minor local air pollution, as this will be site specific and will be managed through measures included in the Environmental Management Plan (EMP). The project will pilot new upgrade methods on existing roads and will not generate additional traffic. Little social conflicts are foreseen as workforce will be small and mainly constitute of FSM nationals. The EMP will include a health and safety plan that will include measures to manage, avoid and mitigate risks and impacts to community and workers during construction.
Involuntary Resettlement There will be no land acquisitions, as minor road piloting civil works will be on existing road alignments.
Indigenous Peoples There are no distinct and vulnerable indigenous groups to be affected by the project as the population is predominantly Micronesian. The people of Chuuk, Kosrae, Pohnpei and Yap exhibit their own distinct culture and tradition but have strong common cultural similarities in traditional extended family and clan systems found on each island.FSM economically has been administered under Spain then Germany and Japan until after World War II when the United Nations created the Trust Territory of the Pacific Islands under the U.S.. With an FSM Constitution established in 1979, the U.S. recognized the establishment of the FSM national and state governments in a Compact of Free Association with the United States.
Stakeholder Communication, Participation, and Consultation
During Project Design A due diligence will be completed on all project component and activities during project preparation and design with focus on gender, the environment and any impacts to the surrounding area and residents. A series of consultations will be conducted during project preparation. Any issues arising from this assessment, workshops, review and consultations will be addressed through measures in the project design phase.Key stakeholders include the National Department of Transportation, Communications and Infrastructure and the associated 4 state authorities such as (i) Chuuk-Department of Transport and Public Works; (ii) Kosrae-Department of Transport and Infrastructure; (iii) Pohnpei-State Office of Transport and Infrastructure and (iv) Yap-Department of Public Works and Transport. Nongovernment organizations, development partners, the private sector, and general public will also be active participants. A consultative process will be carried out employing the projects public communication strategy and community consultation plan.Local communities will be consulted during the social and poverty analysis to identify any social impacts which need to be mitigated. These consultations will be inclusive of women and other marginalized groups.
During Project Implementation During the PRF preparation and implementation, public consultations will be held to design the project components with active participation of women, low income population and communities. The government, relevant stakeholders and the community will be engaged in all aspects of the project through investigation, design and implementation stages. Consultations will ensure that the poor, vulnerable and excluded groups are actively engaged.
Business Opportunities
Consulting Services The government has requested advance action and ADB assistance to select the PRF consultant (firm). ADB will select the PRF consultant with participation from DTC&I following the ADB Procurement Policy, Procurement Regulations for ADB Borrowers (2017, as amended from time to time), and associated Staff Instructions. The DTC&I will negotiate and sign the contract with the first-ranked firm and administer the contract.
Procurement All procurement of goods and works will be conducted in accordance with ADB's Procurement Policy: Goods, Works, Non-consulting and Consulting Services (2017, as amended from time to time) and shall follow the Procurement Regulations for ADB Borrowers: Goods, Works, Non-consulting and Consulting Services (2017, as amended from time to time).
Responsible ADB Officer Ishenaliev, Rustam I.
Responsible ADB Department Pacific Department
Responsible ADB Division PATC
Executing Agencies
Department of Finance and Administration
PS2, Palikhir
Pohnpei State
Federated States of Micronesia
Timetable
Concept Clearance 25 May 2021
Fact Finding 31 May 2021 to 07 Jun 2021
MRM 30 Jul 2021
Approval 20 Oct 2021
Last Review Mission -
Last PDS Update 21 Oct 2021

Grant 6039-FSM

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
20 Oct 2021 15 Nov 2021 22 Feb 2022 30 Jun 2024 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 5.50 Cumulative Contract Awards
ADB 5.00 17 Jun 2022 0.00 0.00 0%
Counterpart 0.50 Cumulative Disbursements
Cofinancing 0.00 17 Jun 2022 0.00 0.00 0%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating - Satisfactory - Satisfactory - 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.

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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.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

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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.

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Tenders

Tender Title Type Status Posting Date Deadline
PRF Consultant for Project Prioritization, Readiness, and Pilot-testing Firm - Consulting Closed 03 Aug 2021 27 Aug 2021

Contracts Awarded

No contracts awarded for this project were found