ASIAN DEVELOPMENT BANK RRP: CAM 34541

REPORT AND RECOMMENDATION

OF THE

PRESIDENT

TO THE

BOARD OF DIRECTORS

ON A

PROPOSED LOAN

TO THE

KINGDOM OF CAMBODIA

FOR THE

EMERGENCY FLOOD REHABILITATION PROJECT

AND ON A PROPOSAL

TO USE LOAN SAVINGS

November 2000

CURRENCY EQUIVALENTS(as of 30 November 2000)

Currency Unit – Riel (KR)Riel1.00 = 0.0002621$1.00 = KR 3,815

ABBREVIATIONS

ADB – Asian Development BankADPC – Asian Disaster Preparedness CenterCPI – consumer price indexCRC – Cambodian Red CrossDRD – Directorate of Rural DevelopmentERG – Emergency Response GroupEU – European UnionFTBC – Foreign Trade Bank of CambodiaFWUC – Farmer Water User CommunitiesGDP – Gross domestic productha – hectaresIA – Implementing AgencyICB – international competitive biddingIRC – Interministerial Resettlement CommitteeJFPR – Japan Fund for Poverty Reductionkm – kilometerLCB – local competitive biddingm – meterMEF – Ministry of Economy and FinanceMOEYS – Ministry of Education, Youth and SportsMOH – Ministry of HealthMOP – Ministry of PlanningMOWRAM – Ministry of Water Resources and MeteorologyMPWT – Ministry of Public Works and TransportMRD – Ministry of Rural DevelopmentNCDM – National Committee for Disaster ManagementNGO – nongovernment organizationsO&M – operation and maintenancePAP – Performance Action PlanPCC – Project Coordination CommitteePCU – Project Coordination UnitPIU – Project Implementation UnitPMCU – Project Monitoring and Coordination UnitPMO – Project Management OfficePRDC – Provincial Rural Development CommunitiesRIIP – Rural Infrastructure Improvement ProjectRRC – Royal Railways of CambodiaUN – United NationsUNICEF – United Nations Children’s FundWFP – World Food Programme

NOTE

(i) In this report, “$” refers to US dollars

CONTENTS

LOAN AND PROJECT SUMMARY ii

MAP iii

I. THE PROPOSAL 1

II. INTRODUCTION 1

III. BACKGROUND 1

A. Special Circumstances of the 2000 Floods 1B. Impact of the Floods 2C. Response to the Floods 4D. External Assistance 4E. Lessons Learned 5F. The Country Operational Strategy of ADB 5

IV. THE PROPOSED PROJECT 5

A. Rationale 5B. Objectives and Scope 6C. Cost Estimates 7D. Financing Plan 7E. Executing Agency 7F. Implementation Arrangements 8G. Environmental and Social Measures 15

V. PROJECT JUSTIFICATION 16

A. Impact on Poverty and Other Benefits 16B. Risks 17

VI. ASSURANCES 17

A. Implementation 17B. Agriculture Sector 17C. Advance Action and Retroactive Financing 18

VII. AVAILABILITY AND UTILIZATION OF LOAN SAVINGS 18

VIII. RECOMMENDATION 18

APPENDIXES 21

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LOAN AND PROJECT SUMMARY

Borrower The Kingdom of Cambodia

Project Description The Project is designed to rehabilitate infrastructure that wasdamaged during the floods that occurred in 2000. The Project willconcentrate on the national road system, irrigation and floodcontrol, rural infrastructure, and education and health facilities.

Classification Primary: EconomicSecondary: Poverty reduction

EnvironmentAssessment

Category B

Rationale The unprecedented intensity and duration of the 2000 floodshave resulted in major disruption of people’s lives and economicactivity, and have severely damaged physical infrastructure. Thecost of rehabilitation is beyond the capacity of the Government.By providing funds for rehabilitation works, the Project will permitthe Government to maintain its development programs at areasonable level.

Objectives and Scope The main objective of the Project is to assist the Government torehabilitate key infrastructure damaged by the 2000 floods, andto enable the early restoration of economic and social activity,especially for the rural poor. The Project provides forrehabilitation of facilities in key sectors to pre-flood levels. TheProject will rehabilitate flood-damaged facilities by providing civilworks; equipment and materials; and consulting services fordesign work, evaluation and implementation, supervision, andcoordination.

Cost Estimates The total cost of the Project is estimated at $83 millionequivalent, comprising $47.0 million (57 percent) in foreignexchange, and $36.0 million equivalent (43 percent) in localcurrency costs.

Financing PlanSource

ForeignExchange($ million)

LocalCurrency($ million)

TotalCost

($ million)

PercentFinancing

ADB loan 35.5 19.5 55.0 66.3Loan Reallocation 11.0 1.5 12.5 15.0WFP grant 0.5 1.5 2.0 2.4Government 0.0 13.5 13.5 16.3 Total 47.0 36.0 83.0 100.0ADB=Asian Development Bank, WFP=World Food Programme.

Loan Amount AndTerms

The equivalent in various currencies of SDR 42,741,000 will befrom Asian Development Bank’s (AD) Special Funds resources

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with a term of 32 years including a grace period of 8 years. Theannual interest charge will be 1.0 percent during the grace periodand 1.5 percent thereafter.

Period Of Utilization Until 30 June 2004

Executing Agency The Executing Agency is the Project Coordinating Committee,established especially by the Government for the Project. TheImplementing Agencies are:

Part A – Ministry of Public Works and Transport;Part B – Ministry of Water Resources and Meteorology;Part C – Ministry of Rural Development;Part D – Ministry of Education, Youth and Sports; andPart E – Ministry of Health.

ImplementationArrangements

Each Implementing Agency is responsible for implementing itspart of the Project, which will consist of a series of subprojects.Project coordination will be provided by the project coordinatingcommittee, which is responsible for subproject screening,coordination, and resolution of interagency problems.Implementation will follow procedures established under ongoingprojects as far as possible.

Procurement Advance action and retroactive financing have been approved forcertain components, for eligible expenditures after the date ofappraisal and subject to approval of the loan by ADB.

Goods and services to be financed by ADB will be procured inaccordance with ADB’s Guidelines for Procurement. Equipmentand materials will be procured under international competitivebidding if valued at more than $1 million equivalent or less. Asthe Project sites are scattered throughout the country, andinvolve relatively small civil works contracts, the civil works arenot likely to attract the interest of international contractors. Forparts B-E, domestic contractors have the capacity and capabilityto undertake the required contracts, following established localcompetitive bidding procedures. In the interest of time, onlycontractors that have already been prequalified under othercontracts will be invited to bid. All civil works contracts for therehabilitation of roads and bridges (part A), with a value of $2.5million or more, will be awarded on the basis of internationalcompetitive bidding procedures. For suitable contract packagesunder $2.5 million, local competitive bidding procedures will befollowed. The force account procedure will be allowed particularlyfor small, scattered civil works.

Consulting Services The Project is expected to use 340 person-months ofinternational and 830 person-months of domestic consultants,some of which will be contracted under existing contractarrangements. Consultants will be engaged by the agencyconcerned in accordance with ADB’s Guidelines on the Use of

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Consultants and other arrangements satisfactory to ADB for theengagement of domestic consultants.

Estimated ProjectCompletion Date

31 December 2003

Project Benefits And Beneficiaries

The Project will benefit large numbers of people in flood-affectedareas in Cambodia, and especially poor people in the ruralareas. Since the project activities will restore facilities, theeconomic benefits are expected to be high especially becausemuch lower levels of economic activity would persist without therestoration work. A major benefit of the Project will be therestoration of essential transportation and social infrastructurefacilities. The restoration of transportation links via the nationalhighway system will enable economic activity to resume and willmake it easier to distribute relief supplies throughout the country.The restoration of the dike protecting Phnom Penh will benefit allresidents, who would otherwise be at risk during the comingflooding season. Restoration of irrigation facilities will allow year-round agriculture production to resume as soon as possible.Rehabilitation of education facilities will permit children to resumeschooling as early as possible, while restoration of healthfacilities will allow health services to resume. The rehabilitation ofADB-assisted projects damaged by the floods will help to ensurethat the projected benefits, which could be lost due to the floods,will still accrue.

Rehabilitation of infrastructure, as well as other Project activities,will directly and indirectly benefit the poor. The majority of theproject works are labor-intensive, localized civil works usingunskilled or semiskilled labor, and will create local purchasingpower, thereby helping to revive the rural economy. By buildingon the existing capacity building components of ongoing ADB-assisted projects, the Project is expected to create long-termcapacity for rehabilitation and maintenance of infrastructure,especially in rural areas.

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I. THE PROPOSAL

1. I submit for your approval the following Report and Recommendation on a proposedloan to the Kingdom of Cambodia for the Emergency Flood Rehabilitation Project, and on aproposal to use loan savings from ongoing projects in Cambodia for rehabilitation of flooddamage.

II. INTRODUCTION

2. Since July 2000, record floods, in terms of water levels and duration, have inundatedmore than 50 percent of Cambodia. The floods have caused severe human suffering, majordisruption of social and economic life activities, and serious damage to infrastructure. TheGovernment requested urgent assistance from the Asian Development Bank (ADB) for therehabilitation of flood-damaged facilities. A reconnaissance mission was fielded 2-6 October,followed by the Appraisal Mission1 on 2-9 November 2000. The Mission’s objectives were to (i)assess the extent of the flood damage and rehabilitation assistance required, (ii) prepare aproposal for loan assistance to meet rehabilitation requirements, (iii) liaise closely with theexternal funding community in Cambodia to ensure overlap and duplication are avoided, and (iv)prepare a grant financing proposal for direct support to the poor.

3. The Mission undertook field visits, met with the National Committee for DisasterManagement (NCDM) and senior Government officials, nongovernment organizations (NGOs)and financing agencies involved in relief and rehabilitation work. The Mission’s major findingswere reflected in a memorandum of understanding, which was discussed and signed at ameeting on 9 November 2000. This report is based on the findings of the Mission, and proposesapproval of a loan for the Project and use of loan savings from one ongoing project. Appendix 1summarizes ADB’s total assistance package for flood damage rehabilitation.

III. BACKGROUND

A. Special Circumstances of the 2000 Floods

4. Whereas the 1996 flood, which caused extensive damage to infrastructure, lasted lessthan two weeks, the 2000 flood started in the middle of July and continued until mid-November.In 1996, the Mekong River was above emergency level for about 10 days; in 2000, the river hasbeen well above emergency level for all of September and well into October. The record highlevels of the river systems and the unusually long floods, combined with the residual impact ofthe 1996 floods, have seriously damaged Cambodia’s infrastructure and caused the peopleextensive suffering as a result of displacement, food shortage, interruption of economiclivelihood, and disease.

5. Upriver, north of Phnom Penh, water levels dropped steadily below emergency levelsafter 26 September, while in the southern delta region water has been draining more slowly, ornot at all in some areas, as of early November. Periods of severe rainfall in Cambodia or VietNam continue to cause fresh flooding because of this persistent situation, and have, onoccasion, caused additional damage to infrastructure.

1 A.B. Frielink (Sr. Programs Officer and Mission Leader), T.F. Jones (Senior Project Economist), J. Weinstock

(Senior Poverty Reduction Specialist), P. Logan (Project Specialist), A. Jude (Project Specialist), M. Dembinski(Project Specialist), and M. Noguchi (Counsel). ADB’s Resident Representative in Cambodia, and staff of theResident Mission provided valuable guidance and support to the Mission. F. Pante, Jr., Manager, and C. Houser,Economist, gave valuable support and guidance from headquarters.

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B. Impact of the Floods

6. The floods have had a serious impact on human life and economic activity, because ofthe unprecedented water levels, and their unusually long duration. Over 260 people died andabout 2.8 million people were affected, 57,000 families were evacuated, and 5,700 houses weredestroyed. The long duration of the floods meant a loss of income and a draw down of savingsfor many people, especially the poor and landless. The poorest of the poor are most at risk.Poor nutrition increases the threat from postflood disease, though there are as yet no signs ofany widespread illnesses. The Government has estimated the cost of rehabilitation at over $140million.

7. It is estimated that about 2,600 km of primary roads, out of a total of 7,700 km, havebeen damaged by the floods. In addition, more than 3,000 m of bridges have been destroyed orbadly damaged. More than 100 flood control and irrigation systems in 15 provinces weredamaged during the floods. The Kop Srov dike, which protects the city of Phnom Penh, was inserious danger of failing for almost a month and is in a poor state of repair. Based onpreliminary estimates, 1,300 km of laterite roads and 2,000 km of earthfill roads were flooded.Of the flooded roads, 57 percent of the laterite roads, and almost 100 percent of the earthfillroads were damaged to various degrees. More than 1,000 schools were damaged, often badly.Around 170 health centers in 16 provinces were affected to various degrees.

1. Economic Impact

8. The 2000 floods will have a major impact on Cambodia’s macroeconomic performance.Estimates of the extent of damage to the rice crop range from 10-20 percent of the cultivatedarea. Although details are unavailable at this time, the magnitude of the economic loss fromother crops destroyed as well as livestock appears to be relatively small given estimates of retailvalue loss of $61.8 million for rice, $8.5 million for subsidiary crops, and $0.5 million forlivestock. Thus, a rough estimate of the direct economic impact of floods on agriculturalproduction is 1.0-2.0 percent of GDP, or an average of 1.5 percent.

9. There are two main countervailing macroeconomic influences in 2000. First, industrialgrowth should reach double digits in 2000 (perhaps 16 percent) mainly because of the 50percent increase in garment exports to the United States in the first eight months of 2000relative to the first eight months of 1999. Second, abstracting from any indirect impacts of theflood, service sector growth should reach 4.0 percent in 2000, in part because of the 40 percentincrease in tourist arrivals in the first half of 2000. Overall, the economy should achieveeconomic growth of perhaps 3.5 percent. The distribution of this modest growth, however, islikely to be very uneven, with positive growth in the urban areas, and contraction in the flood-affected rural areas.

10. In terms of price movements, seasonal increases in food prices are normal from Julythrough October. Nevertheless, vegetable prices, carrying a 3.8 percent weight in the consumerprice index (CPI), increased sharply in September and are up about 12 percent from a year ago.However, rice price increases, with a 5.3 percent CPI weight, are more modest and prices arestill down about 7.5 percent from a year ago. This is not surprising since vegetable prices tendto be determined locally while rice is more influenced by world prices, which are down this yearbecause of a large supply. Meat and poultry prices, with a 7.9 percent CPI weight, rose slightlyin September but are still down 4.5 percent from last year while fish prices, with a 6.8 percentweight, are up sharply in September but still down 10 percent from last year.

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2. Agriculture

11. Agriculture, which is the primary source of income in rural areas, is generallysubsistence-oriented, with rice as the dominant crop. Rice is mainly cultivated along the MekongRiver and around the Tonle Sap Lake. About 2.1 million ha (more than 90 percent of the totalcropped area of 2.3 million ha) are planted with rice. Other major agricultural crops includemaize (44,100 ha), soybeans (30,600 ha), vegetables (29,100 ha), and mung beans (25,600ha). Rubber and timber have long been the most important agriculture export products ofCambodia, but agricultural products are increasingly being traded with neighboring countries.The average farm size is estimated at 1.10-1.26 ha. However, such national averages maskconsiderable differences in average farm size between provinces, ranging from 0.55 ha inKandal Province in the south to 2.10 ha in Mondol Kiri Province in the east. About three-quarters of rural households are also engaged in livestock production.

12. Recent declines in crop yields were mainly caused by irregular weather conditions,particularly rainfall unfavorable for rainfed rice cultivation, and by the shortage of irrigationfacilities. Less than 10 percent of the cultivated area in Cambodia is irrigated. The country’sannual yield of unhusked rice was estimated at 1.8 tons per ha in 1999. This yield level isconsidered to be the lowest in the region and has improved from 1.0 ton per ha in 1967.Constraints to improving agricultural productivity include (i) poor transport infrastructure in ruralareas; (ii) inadequate irrigation facilities, particularly for rice cultivation; (iii) ineffectiveagricultural research and extension services; and (iv) lack of reliable and easily accessiblefinancial services. Provision of better access to a package of necessary inputs such asimproved seed varieties, fertilizers, and pesticides is also required for increased agriculturalproductivity. Nevertheless, there was a slight increase in total rice production, estimated atabout 3.50 million tons in 1998 as compared with 3.45 million tons in 1997.

13. The projected impact of the floods on rice production is two-fold. Wet season rice, whichis not normally flooded, has been under water for extended periods of time, thus greatlyreducing or fully destroying the crop. Some of the dry season rice is grown in fields where thewater is retained when floods recede. In a number of areas, retaining dams have beenbreached or undermined so that water will escape freely, and consequently, yields can beexpected to be lower than normal.

14. At the village and farm level, many fields have been inundated for extended periods, andpeople have lost their complete crop. They have also been forced to consume their rice seed.Moreover, the poorer part of the population is most likely to live in the lower-lying parts, and willbe hardest hit. The continued high water levels also mean that it may not be possible to plantlate wet season or recession rice, as the days are getting too short for the crop to grow. Thus, inparts of the country there is an acute shortage of food, which the Government and the reliefagencies are trying to address, and a shortage of seed for the coming seasons.

3. Poverty

15. After years of prolonged civil conflict, Cambodia suffers pervasive poverty. Using aconsumption-based poverty line defined as adequate income to buy a daily 2,100-calorie foodbasket plus an allowance for nonfood expenditure, in 1997, 36.0 percent of the population wereclassified as poor. However a large proportion of the population is clustered around the povertyline indicating a potential for significant increases in the incidence of poverty when faced witheven limited environmental, political, or economic uncertainties. Poverty varies considerably

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between urban and rural areas, as well as across regions. Urban areas are relatively better off,with about 90 percent of the poor in rural areas, especially those relying on subsistenceagriculture as the primary source of income.

16. Widespread poverty in Cambodia is indicated by the paucity of basic economic andsocial infrastructure. Only 14 percent of villages have a market, 43 percent have access toelectricity (at least in some households), 11 percent have a bank or credit facility, and 4 percenthave an agricultural extension worker. Furthermore, only 23 percent of villages have access topiped water, 46 percent have a primary school, 5 percent have lower secondary schools, and 16percent have a clinic. While richer villages are diversified, with trading as an important economicactivity, poorer villages tend to depend heavily on subsistence agricultural activities.

17. In the poorest quintile of villages, 70 percent of the population are poor. Furthermore,many of the poorest villages are on less productive lands in areas vulnerable to flood ordrought. Hence, while the recent floods have increased the overall national poverty level, inareas effected by the flood already high levels of poverty have become extremely high.

C. Response to the Floods

18. The NCDM, under the chairmanship of the Prime Minister, has been directing andcoordinating relief efforts from the start. The focus has been primarily distributing food, blankets,and medicines, and providing shelter for the displaced. Close coordination has taken placethrough regular meetings between the Government, the funding community (cochaired by theUnited Nations [UN] Development Programme and World Food Programme [WFP]), and theCambodian Red Cross. Line ministries have been charged with damage assessment, althoughin many cases detailed assessment has to await recession of the waters. Priority is given to therestoration of road communications through the national road network.

19. To coordinate relief efforts with the international community, a core group has beenestablished for planning and coordination, consisting of the NCDM, Cambodian Red Cross,International Federation of the Red Cross, and the UN Disaster Management Team. Under thecore group, an emergency response group (ERG) was formed as the focal point for coordinationand information sharing. The ERG has been meeting weekly or every two weeks. Recently, foursubgroups have been formed, one each for: (i) emergency relief assistance; (ii) food security;(iii) health; and (iv) water, sanitation, and small-scale infrastructure. Action is being taken toform a fifth subgroup for data collection and dissemination.

D. External Assistance

20. While funding agencies have generally been actively involved with the ERG, and beensupportive of the Government in the management and relief operations, firm financial pledgeshave been slow in forthcoming. On 5 October 2000, five UN agencies published an appeal forrelief and some rehabilitation assistance worth $10.8 million. As of 7 November, pledges of only$3 million had been received through the UN system. In addition, the International Federation ofthe Red Cross pledged $2 million, and smaller amounts were pledged by bilateral agencies andNGOs, totaling around $16.6 million (Appendix 2). For the rehabilitation of infrastructure, anumber of donors have shown interest, but few firm commitments have been made to date.

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E. Lessons Learned

21. ADB’s 1999 country portfolio review mission concluded that the Government had madeconsiderable progress in improving project implementation. Core capacity in line ministriesinvolved in implementing ADB-assisted projects started to emerge over the last few years, whilethe streamlining measures adopted by the Ministry of Economy and Finance (MEF) to expediteprocessing of contract award documents and disbursement requests have yielded positiveresults. The Government and ADB have made a concerted effort to build capacity of counterpartstaff through technical assistances, training seminars, and manuals. Compliance with loancovenants, particularly the timely submission of audited project accounts and financialstatements, has generally been satisfactory. The 1999 mission advised the Government to takemeasures to minimize delays in project implementation and to consider increasing delegation ofauthority to project directors.

22. A draft audit report for the first emergency rehabilitation loan to Cambodia2 drew thefollowing conclusions. First, emergency loans should not include sectors with complicatedissues that require an integrated approach and long-term preparation. Second, emergencyloans should adopt a “process approach” to permit flexible adjustment of project design duringimplementation. Third, special treatment should be given to emergency loans when necessary,including intensive use of consultants, ADB financing of most or even all project costs, and ADBfinancing of operation and maintenance (O&M) funds for a fixed period. Last, follow-up projectscould be prepared in parallel with emergency loans to address policy and institutional issuesand sustain the benefits of the emergency loans.

F. The Country Operational Strategy of ADB

23. ADB’s country operational strategy for Cambodia, Cambodia: Enabling a SocioeconomicRenaissance, July 2000,3 emphasizes support for poverty reduction through interventions inthree priority areas. First, to broadly support economic development of rural areas, ADB willtake a lead facilitative role in water resource management, while playing important supportingroles in rural development, critical wetlands protection, and agricultural reform. Second, to assisthuman and social development, ADB will lead the facilitation of a sector approach in educationwith complimentary supporting roles in health and water supply. Third, to bolster private sectordevelopment, ADB will lead funding agencies’ efforts to support development of the nation‘sroad network while playing a key role in finance and a supporting role in energy. Finally, ADBwill provide strategic support in economic governance in economic planning, public financemanagement, and legal reform.

IV. THE PROPOSED PROJECT

A. Rationale

24. The unprecedented intensity and duration of the 2000 floods have resulted in majordisruptions of people’s lives and economic activity, and have severely damaged physicalinfrastructure. The cost of rehabilitation is beyond the capacity of the Government alone. Byproviding funds for rehabilitation work, the Project will permit the Government to maintain itsdevelopment programs at a reasonable level.

2 Loan 1199-CAM(SF): Special Rehabilitation Assistance Project for $67.7 million, approved on 26 November 1992.3 STS: CAM 2000-15: Country Operational Strategy, Enabling a Socioeconomic Renaissance, July 2000.

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B. Objectives and Scope

25. The main objective of the Project is to help the Government rehabilitate keyinfrastructure damaged by the 2000 floods, and to enable the early restoration of economic andsocial activity, especially for the rural poor. The Project provides for rehabilitation of facilities inkey sectors to preflood levels in 16 provinces. Sectors were identified based on the followingconsiderations:

(i) the priorities of the Government,(ii) ADB experience and involvement in the sector,(iii) damage to ongoing or completed ADB projects,(iv) impact on economic and social welfare of the community, and(v) a clear division of responsibilities with other agencies.

26. The Project will rehabilitate flood-damaged facilities through the provision of civil works,equipment and materials, and consulting services for design, evaluation and implementation,supervision, and coordination. The Project will have six parts:

(i) Part A: national transport network comprises urgently needed repair (phase I)and rehabilitation (phase II) of the flood-damaged national road network,including bridges that have been damaged or washed away, and repair of railwayembankments and railway bridges.

(ii) Part B: flood control and irrigation comprises rehabilitation of a major floodcontrol dike protecting Phnom Penh, and of major and minor irrigation facilities,including embankments, water control structures, and canals.

(iii) Part C: rural infrastructure comprises rehabilitation of flood-damaged ruralinfrastructure facilities, including rural roads, bridges, and culverts within theareas of ADB-financed projects, and of WFP-executed projects.

(iv) Part D: education comprises (a) rehabilitation of education facilities, includingmajor repairs to floors, roofing, and walls; and (b) replacement of furniture andequipment.

(v) Part E: health comprises repair of health centers and clinics, half of which areunder an ongoing ADB project.

(vi) Part F: support to the project monitoring and coordination unit (PMCU) willassist the PMCU by providing consulting services, equipment, supplies, andincremental administrative and personnel costs.

27. The Project will follow a sector approach, with subprojects selected during Projectimplementation. The sector approach is a suitable response to emergencies, as it allows forquick response and maximum flexibility within the agreed framework and selection criteria. Foreach of the five sectors identified for assistance under the Project, on-going ADB-assistedprojects are in place. The Project is an essential component of the Government’s overall plansfor the recovery from the floods. Two subprojects were already identified and brought toappraisal stage, to allow immediate start of the works under retroactive financing arrangements.

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For Parts A-E, the respective Implementing Agencies (IAs) will identify eligible subprojects onthe basis of general as well as sector-specific criteria.

C. Cost Estimates

28. The total cost of the Project is estimated at $83 million equivalent, comprising about$47.0 million in foreign exchange cost and $36.0 million equivalent in local currency, includingtaxes and duties. Since a sector approach is being followed, the cost estimates are on anoverall basis, and therefore no specific allowances have been made for physical or pricecontingencies. Detailed cost estimates are in Appendix 3.

D. Financing Plan

29. It is proposed that the ADB provide a loan of $55 million equivalent from its Special Fundresources, representing 66 percent of the total cost of the Project. The loan will finance the fullforeign exchange cost of equipment, materials, and services, and 45 percent of local currencycosts (excluding taxes and duties). The Government will meet $13.5 million equivalent of thelocal cost component of the Project, including taxes and duties of $11.5 million and $2.0 millionas the counterpart contribution for agriculture, to be financed from the proceeds from theAgriculture Program Loan,4 the second tranche of which was released in September 2000. WFPwill contribute around $2 million in kind, and $12.5 million will be reallocated from existing loans.

Table 1: Financing Plan($ million)

SourceForeign

ExchangeLocal

CurrencyTotalCost

PercentFinancing

ADB loan 35.5 19.5 55.0 66.3Loan Reallocation 11.0 1.5 12.5 15.0WFP Grant 0.5 1.5 2.0 2.4Government 0.0 13.5 13.5 16.3

Total 47.0 36.0 83.0 100.0ADB=Asian Development Bank; WFP=World Food Programme.Source: Staff Estimates

30. The Borrower will be the Kingdom of Cambodia. The ADB loan will be from ADB’sSpecial Funds resources with a term of 32 years including a grace period of 8 years. The annualinterest charge will be 1.0 percent during the grace period and 1.5 percent thereafter.

31. Local cost financing is justified given the tight fiscal situation in Cambodia and theexpenditure required for relief and rehabilitation work. At the same time, revenue generation islikely to decline because of the expected slow down in the economy, which will increase thefiscal deficit.

E. Executing Agency

32. Given the multisectoral nature of the Project, and the relatively weak human resourcecapacity in the Government, close coordination and monitoring is required. The Governmenthas established the PCC, chaired by the Minister of Planning. The PCC is the Executing Agency

4 Loan 1445-CAM(SF): Agriculture Sector Program, for $30 million, approved on 20 June 1990.

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for the Project, and is charged with (i) guiding the implementation of the Project to ensure thatthe Project is implemented within the overall policies and guidelines of the Government andADB, (ii) monitoring the overall implementation of the Project, (iii) providing all necessaryassistance for the quick and efficient implementation of the Project, (iv) ensuring closecoordination between all project activities and activities sponsored by other agencies, and (v)ensuring that ADB is informed in a timely manner of project progress and any issues arising.The PCC will meet at least once every six months. The PCC will, as required, consult with therepresentatives of the IAs on all matters relating to the Project. To enable the PCC to fulfill itsrole adequately, all project reports being submitted to ADB will also be made available to PCC.A representative of ADB’s Cambodia Resident Mission will be invited to attend PCC meetings.The PCC is sufficiently senior in its membership to ensure that any problems arising can bequickly resolved. To carry out its activities and responsibilities, the PCC has established thePMCU.

F. Implementation Arrangements

33. ADB has ongoing projects in each of the five sectors where emergency assistance isproposed, and teams of consultants are in place in most cases. All of the ongoing projectsconcerned are rated satisfactory. The implementation arrangements for the Project have beendesigned to follow the established procedures, practices, and principles as much as possible, inthe interest of speed and economy. Other than for the coordination of project activities betweensectors and with the funding community, no new implementation arrangements are foreseen.

1. Project Management and Coordination

34. The PMCU, established by the PCC and acting for and on behalf of the PCC, shall beresponsible for the day-to-day management, monitoring and coordination of the Project activitiesamong the IAs and with the MEF. The PMCU shall carry out its responsibilities in closecollaboration with the Implementing Agencies, which the PMCU shall assist and advise in anypossible way to facilitate implementation of the Project. The PMCU shall act as facilitator,coordinator and advisor. The IAs shall be responsible and accountable for management anddecision-making in relation to subproject identification, design and implementation.

2. Project Implementation

35. The PMCU shall be headed by the Secretary of State of Planning (the Project Director),and shall have a secretariat office in the MOP, supported by staff from the Borrower andconsultants. The PMCU shall be responsible for: (i) endorsement and submission of subprojectsto the ADB for approval; (ii) full-time monitoring and coordination of project implementation; (iii)regular reporting to the PCC and the ADB on the progress of implementation; (iv) monitoringand coordination of procurement and management of disbursements; (v) consolidation of theProject accounts and maintenance of imprest accounts; (vi) guidance and assistance to the IAson the ADB’s procedures and all other project implementation matters, and (vii) all mattersconcerning donor coordination, to ensure consistency, synergy and conflict avoidance with otherrehabilitation assistance. The PMCU shall be directly responsible to the PCC and the ADB forcontinuous monitoring and coordination of project implementation.

36. The PMCU shall conduct regular project implementation meetings. Seniorrepresentatives, one each from the PCC, PMCU, the MEF and the respective IAs (at theDirector or Deputy Director level) shall meet regularly, at least once every two weeks toapprove, endorse, as necessary, subproject proposals and to decide on project implementation

9

matters that can not be resolved by the IAs themselves. Decisions made by the projectimplementation meetings shall be binding. Copies of the Minutes of the meetings shall besubmitted to the PCC for information.

37. The technical preparation and implementation of subprojects under Parts A-E of theProject shall be carried out by the five IAs: Ministry of Public Works and Transport (MPWT),Ministry of Water Resources and Meteorology (MOWRAM), Ministry of Rural Development(MRD), Ministry of Education, Youth and Sports (MOEYS), and Ministry of Health (MOH),respectively. Each of the IAs shall direct existing Project Implementation Units (PIUs) or ProjectManagement Offices (PMOs) to become responsible for their respective part of the Project. ThePIUs/PMOs, under the overall supervision and guidance of the PMCU, shall be responsible for(i) subproject identification and submission to the PMCU for endorsement; (ii) subprojectformulation and design; (iii) subproject implementation, including construction supervision; (iv)procurement and contract administration; (v) maintaining subproject accounts and operation ofsecondary imprest accounts; (vi) quality control; and (vii) preparation of half-yearly action plans,progress reports and work programs for submission to and agreement with the PMCU. EachPIU/PMO shall be headed by a qualified senior staff of the IA, and shall include other technicalstaff as appropriate to implement the subprojects quickly and efficiently. The IAs shall retain fullaccountability and responsibility for the project implementation. Sufficient authority andaccountability shall be delegated to the respective PIU/PMO to enable them to act pro-activelyand effectively carry out their duties and functions.

38. To ensure timely implementation of the Project, the Government has agreed to specificmeasures to ensure that the internal approval process for subproject selection and approval,and for contracts does not unduly slow down the Project. In this context, the Government hasagreed that, for each IA, whenever a signature is required for approval at senior levels within theconcerned ministry, the signed approval will be given within five working days, or the papersconcerned returned for clarification or additional information. The PMCU has the responsibilityof closely supervising the adherence to this agreement.

39. Project implementation needs to be completed within three years after the disasteroccurred. IAs that have not managed to sign the necessary consultants, supplies, and majorcivil works contracts within 18 months of appraisal date (9 November 2000), will no longer beeligible for funding under the loan, and loan proceeds will be reallocated to other parts of theproject.

40. Part F is to support the PMCU in fulfilling its mandate. The assistance will provideinternational consultants, operational support, and incremental administrative costs. Oneinternational consultant will be hired as soon as possible for a period of three years. Theconsultant will assist in overall coordination, and ensuring speedy submission and approval ofsubprojects. An accountant who is already familiar with ADB accounting requirements andprocedures will be hired for a period of three years. Operational support will include officeequipment, vehicles, supplies and costs for field visits. Details of implementation arrangementsfor each part are in Appendix 4.

3. Subproject Selection and Approval

41. Subprojects will be identified and selected by the IAs, and endorsed by the PMCU, onthe basis of the following criteria:

10

(i) the subproject will rehabilitate public infrastructure that is in one or more of thefive identified sectors and was damaged by the 2000 floods;

(ii) subproject implementation will be completed by 31 December 2003;

(iii) the subproject must be the most cost effective or least-cost solution alternative;

(iv) subprojects that rehabilitate infrastructure from ongoing or completed ADB-assisted projects will receive high priority for funding;

(v) a subproject will not be financed by any agency other than ADB;

(vi) the subproject will meet the sector-specific criteria agreed upon by theGovernment and ADB;

(vii) the subproject will confom with ADB’s guidelines on resettlement; and

(viii) the subproject will conform with the environmental requirements of theGovernment and ADB.

42. The first subproject to be carried out by each IA under Parts A-E, shall be subject to priorreview and approval by ADB. Subsequent subprojects exceeding $250,000 equivalent shall besubmitted by the IA to the PMCU for endorsement and to the ADB for review and approval.Subprojects costing less than $250,000 shall be sent to the PMCU and the ADB for informationonly. Regardless of the amount specified above, for subproject 1 of Part B (rehabilitation of amajor flood control dyke protecting Phnom Penh) and any other subproject in the Project whichmay include an issue of resettlement, the IA shall prepare and submit a resettlement plan inaccordance with the ADB’s guidelines on involuntary resettlement and other arrangementsagreed upon between the Government and the ADB, for ADB approval before carrying out thesubproject.

4. Consulting Services

43. Given the tight time schedule and the shortage of well-trained and experienced staff inthe Government, strong consultant support is required for the PMCU and IAs. Consultingservices are required due to (i) the need for careful verification of flood damage assessmentreports in each sector, (ii) the sector loan approach requiring preparation and evaluation ofsubprojects, (iii) the need for intensive supervision for the rapid completion of works, (iv) theincreased workload on the existing supervisory staff of the Ias, and (v) the need for consistencyin design and construction standards. In a number of instances, consultant contracts underexisting loans can be extended or expanded in scope to provide the necessary services,thereby minimizing the need for consulting services under the loan. The Project will require anestimated total of 340 person-months of international and 830 person-months of domesticconsulting services.

44. Consultants will assist the PMCU in (i) overall project coordination and supervision; (ii)maintenance of project accounts and operation of the imprest account in accordance with ADBguidelines; (iii) provision of guidance to IAs in identification, selection, and preparation ofsubprojects; (iv) evaluation of proposed subprojects and liaison with ADB to ensure early

11

approval; and (v) meeting the reporting requirements. Outline terms of reference are inAppendix 5.

45. Consultants to the IAs will help in (i) identify and formulate subprojects; (ii) preparespecifications, designs and cost estimates; (iii) evaluate bids and contract awards; (iv) superviseof construction, quality, and cost control, including issuance of payment certificates; and (v)report progress.

46. All consultants will be engaged by the IA concerned in accordance with ADB’sGuidelines on the Use of Consultants and other arrangements satisfactory to ADB for theengagement of domestic consultants. In order to save time, and because many of the IAs havealready engaged consultants under related ADB-financed projects, ADB and the Governmenthave agreed that direct engagement of consultants is preferred, as provided for under ADB’sGuidelines on the Use of Consultants. At the request of the Government, ADB will assist in theselection process by shortlisting the consultants, inviting proposals, and evaluating and rankingthem.

5. Procurement

47. Goods and services to be financed by ADB will be procured in accordance with ADB’sGuidelines for Procurement. Equipment and materials will be procured under internationalcompetitive bidding (ICB) where the cost is valued at more than $1 million equivalent, or byinternational shopping where the cost is valued at $1 million equivalent or less. Since the projectsites are scattered throughout the country and mostly involve relatively small civil workscontracts, the civil works are not likely to attract the interest of international contractors. Forparts B-E, domestic contractors have the capacity and capability to undertake the requiredcontracts, following established local competitive bidding (LCB) procedures. In the interest oftime, only contractors that have been prequalified under other contracts will be invited to bid.Following the procedures established under Loan 1697-CAM5, all civil works contracts for therehabilitation of roads and bridges, with a value of $2.5 million or more, will be awarded on thebasis of ICB procedures. For suitable contract packages under $2.5 million, LCB procedures willbe followed. The rationale is that ICB contractors will only be interested in the larger continuouscivil works contracts while the local contractors, including international contractors alreadyestablished and working in Cambodia, could be interested in contracts in scattered locations,some with security problems. The force account procedure will also be allowed particularly forsmall, scattered civil works where it is difficult to prepare logical contract packages mainlybecause of the piecemeal nature of the civil works. Procurement periods will be reduced to 21days for LCB contracts and 60 days for ICB tenders.

48. The tender evaluation and contract documentation for civil works for the first subprojectselected by each IA and for civil works with a value exceeding $250,000 equivalent, will bereviewed and approved by ADB before the award of the contract. The award of subsequent civilworks contracts with a value not exceeding $250,000 equivalent will be subject to ADB’s laterapproval; however, if the award or terms of any such contract are not subsequently approved byADB, the Government will refund to ADB any payment made from the loan to finance such acontract, and then provide financing from its own or other resources. Equipment or materialvalued at less than $100,000 equivalent may be procured by direct purchase. Bid packages willbe prepared for the subprojects in line with the practice being followed by executing agencies inongoing ADB financed projects.

5 Loan 1697-CAM (SF): Primary Roads Restoration Project approved for $68.0 million on 21 September 1999.

12

6. Advance Action

49. Given the urgency of the Project, ADB has approved advance action for the procurementof equipment, materials, and civil works, and for the recruitment of consultants. TheGovernment has been advised that such advance action does not commit ADB to finance anypart of the Project.

7. Retroactive Financing

50. Retroactive financing is essential for the repair or rehabilitation of critical facilities beforethe next flooding season. The Project therefore provides for retroactive financing of eligibleexpenditures incurred not earlier than 9 November 2000 (date of appraisal), provided that theexpenditures are certified by the IAs and consultants; the certification is acceptable to ADB; andthe subprojects concerned were identified, appraised, and ready for implementation on orbefore 9 November 2000. Retroactive financing has therefore been approved for subproject 1 ofpart A (urgent repairs to the national road network), and subproject 1 of part B (rehabilitation ofthe Kop Srov flood protection dike). Details are in Appendix 6. The Government has beenadvised that provision for retroactive financing does not commit ADB to finance any part of theProject.

8. Implementation Schedule

51. ADB and the Government have agreed that project implementation will be completed asmuch as possible before the start of the flooding season in 2003, but in any case not later thanDecember 2003. This will provide for a partial dry season (2001, assuming that the floodwaterswill recede by January 2001), and two full dry seasons (2002 and 2003). Priority will be given tosubprojects that are critical to complete before the next flooding season in July 2001.

9. Performance Reviews and Reports

52. The overall progress of project implementation shall be monitored by the PCC. For thatpurpose, the PCC, through the PMCU, shall establish a reporting system of performancemonitoring, and issues resolution action plans. Each PIU/PMO and the PMCU shall preparehalf-yearly Performance Actions Plans (PAP) to serve as a management feedback and actiontool. PAPs shall be reviewed and approved by the PCC and the IAs concerned on a half-yearlybasis. PAPs shall establish a work plan with quantitative, qualitative and time bound targets forthe following six months. PAPs shall be jointly agreed and approved by the IAs and the PCC.The ADB shall be invited to participate in the half-yearly reviews to address issues and resolveproblems encountered during Project implementation.

53. Within three months of physical completion of the Project, the Government will submit toADB a completion report that provides details about implementation, costs, benefits, and otherinformation as requested by ADB.

10. Accounts and Audit

54. Each IA will maintain separate records and accounts adequate to identify the goods andservices financed from the loan proceeds, the financing resources received, the expendituresincurred for the Project, and the use of local funds. Accounts will be established and maintainedin accordance with the generally accepted accounting principles and following the guidelines in

13

the Project Accounting Manual of MEF. Consolidated Project accounts and related financialstatements will be compiled by the PMCU, and audited annually by auditors acceptable to ADB.The audited reports and related financial statements will be submitted to ADB not later than 12months after the end of the fiscal year to which they relate.

11. Imprest Accounts

55. An imprest account will be established at a bank acceptable to ADB and operated by thePMCU. Each IA will also open a new imprest account for the Project. Each imprest account willbe operated by the PCC or the IA concerned, in accordance with ADB’s Loan DisbursementHandbook, and detailed arrangements agreed upon by the Government and ADB. The initialamount in each imprest account will not exceed four months of estimated expenditures. ADB’sstatement of expenditures procedures will be followed for reimbursement of expenditures andfor the liquidation of each imprest account, for payments not exceeding $100,000 equivalent ineach case.

12. Operation and Maintenance

56. All facilities rehabilitated under the Project will be operated and maintained by theresponsible IAs after completion of the works. Where facilities form part of an ongoing orcompleted subproject, the O&M arrangements agreed upon with ADB for those subprojects willcontinue to apply. The Government will make available on a timely basis the funds necessaryfor this purpose during and after project implementation. Under the Primary Roads RestorationProject,6 provision has been made to strengthen the maintenance planning and implementationcapability of MPWT. Arrangements are also being made to establish a road fund to help ensurefunding for road maintenance. In the case of flood control and irrigation schemes, MOWRAMwill be responsible for O&M. MOWRAM has developed a policy and legislation for sustainableO&M of irrigation systems, which involves the transfer of O&M responsibilities to farmers over afive-year transitional period.7 The approach for this Project will emphasize the involvement offarmers in the management of the repaired and rehabilitated systems. Staff from MOWRAM’sIrrigated Agriculture Department will work closely with farmers to form water user communitiesto manage the rehabilitated schemes. After completion, responsibility for each scheme will betransferred to its water user community’s board.

13. Community Participation

57. Community consultation and participation is important to incorporate local knowledgeand experience, understand community needs and priorities, and avoid any conflicts of interestamong beneficiaries. Most of the works will involve the rehabilitation of existing infrastructureand should therefore be well accepted by local communities. Rehabilitation works will alsoreinforce the perception that previous inputs in project selection, design, and implementationhave not been lost. Several of the IAs have procedures for community consultation andparticipation, especially for rural infrastructure, irrigation, and education. These procedures willbe applied in project activities as well.

6 Loan 1697-CAM (SF): Primary Roads Restoration Project approved for $68.0 million on 21 September 19997 Kingdom of Cambodia, June 2000. Circular No.1 on the Implementation Policy for Sustainable Irrigation Systems;

Policy for Sustainability of Operation and Maintenance Irrigation Systems; and Steps in the Formation of a FarmersWater Users Community.

14

14. The Implementing Agencies

a. Part A: National Transport Network

58. The MPWT will be the IA for part A. MPWT will appoint a senior engineer as a full-timedirector, who will be responsible for the day-to-day control of part A. For the works to beundertaken, including consultant services through funds provided under ongoing loans, existingorganizational arrangements will apply. For the ongoing projects, the Project Management Units(PMUs) are in place and are operating well.8 Additional staff will be needed within the PMUs tohandle the additional work required under the loan.

b. Part B: Flood Control and Irrigation

59. MOWRAM, the IA for part B, was created in 1999 by upgrading the Ministry ofAgriculture, Forestry and Fisheries’ Directorate General of Agricultural Hydraulics and Hydro-Meteorology. MOWRAM is responsible for managing all Cambodia’s water resources in anenvironmentally sound manner so as to optimize benefits in the short and long term. MOWRAMhas nine technical and administration departments and is overseen by a minister and cabinet ofsenior officers. This set-up is replicated in each of Cambodia’s 23 provinces. MOWRAM has800 staff in Phnom Penh and about the same number in the provinces. MOWRAM has overallresponsibility for the identification, planning, detailed design, construction, and O&M ofirrigation, drainage, and flood mitigation schemes. Large-scale systems (5,000 ha and over) aremanaged from the central level, while all other systems are the primary responsibility of theprovinces.

c. Part C: Rural Infrastructure

60. MRD is the IA for part C. MRD was established in December 1993 as the StateSecretariat for Rural Development, the successor to the short-lived Ministry of RuralDevelopment under the provisional Government. The State Secretariat was upgraded to aministry in October 1994. MRD’s responsibilities include (i) rehabilitating and reconstructingsmall-scale rural infrastructure; (ii) improving production and marketing systems; (iii) ensuringfood security for all Cambodians in rural areas; (iv) ensuring the social rehabilitation of returneesthroughout the country in a fair and equitable manner; (v) improving the socioeconomic status ofthe rural poor; and (vi) rehabilitating, constructing, and maintaining tertiary level rural roads.

61. MRD has eight departments consisting of four administrative departments and fourtechnical departments, including the departments of community development (responsible for,among others, rural roads and rural infrastructure), rural water supply, rural economicdevelopment, and primary health care. Each department is headed by a director, who isassisted by a number of deputy directors. At the provincial level the directorate of ruraldevelopment is also headed by a director, seconded by a deputy director, both of whom work inclose cooperation with the provincial governor on matters related to rural development. Unlikeother provincial agencies, the representation of MRD extends to the district level, withdevelopment offices under the district chief (rural development).

8 PMU-1 is responsible for Loan 1659-CAM: Phnom Penh-Ho Chi Minh City Highway Project and PMU-2 is

responsible for Loan 1697-CAM (SF): Primary Roads Restoration Project.

15

d. Part D: Education

62. The Ministry of Education, Youth and Sports (MOEYS) will be the IA for part D and willhave overall responsibility for planning, organizing, and coordinating the activities related toemergency flood rehabilitation assistance for damaged primary and secondary schools,including monitoring the progress achieved. MOEYS has previous experience implementingADB loans9 and TA projects. In fact, the Special Rehabilitation Assistance Project included acomponent that supported restoring and upgrading selected educational facilities. MOEYS hasmanaged external assistance from multilateral and bilateral agencies and has the capacity toimplement rehabilitation projects. The ongoing Basic Education Textbook Project10 is ratedhighly satisfactory both in meeting its development objectives and implementation progress.With the assistance of consultants, MOEYS will be able to continue such good progress inimplementation.

e. Part E: Health

63. The Ministry of Health (MOH) will be the IA for part E. MOH is responsible for managingthe health care system and its facilities. At the provincial level, the provincial health director hasoverall responsibility for the management and administration of services, but the provincialhygiene station is a separate unit accountable to the provincial health director for implementingselected national programs such as maternal care. MOH has substantial experience inimplementing ADB-financed projects as well as other projects of similar types. The ongoingBasic Health Project11 is rated highly satisfactory both in meeting its development objectivesand implementation progress. With the assistance of consultants, MOH will be able to continuesuch good progress in implementation.

15. Part F: Support to the PMCU

64. The PMCU is in MOP, which was the Executing Agency for ADB’s emergency loan(footnote 2). The PMCU needs two long-term international consultants to help effectivelycoordinate and supervise the implementation of the Project.

G. Environmental and Social Measures

16. Environment

65. The Project has been classified as Category B, and is not likely to have any significantadverse environmental impacts. Civil works will involve rehabilitation or reconstruction of flood-damaged infrastructure. Repairs and rehabilitation of the national roads as well as the ruralroads will follow existing alignments, and will not involve land acquisition. All subprojects willfollow environmental safeguards and technical design specifications established for ongoingADB-assisted projects, which have already been subjected to ADB’s environmental assessmentprocedures. If a subproject is proposed that might involve construction of infrastructure alongnew alignments or acquisition of land, the responsible IA, through the PMCU, will first submit aninitial environmental examination for ADB approval. The IAs are familiar with ADB’srequirements for environmental assessments, and have undertaken such examinations in the

9 Loan 1199-CAM (SF): Special Rehabilitation Assistance for $67.7, approved on 26 November 1992; Loan 1368-

CAM (SF): Basic Skills for $20 million, approved on 30 August 1995; Loan 1446-CAM (SF): Basic EducationTextbook Project for $29.3 million, approved on 20 June 1996.

10 Loan 1446-CAM (SF): Basic Education Textbook, approved for $20.0 million on 20 June 1996.11 Loan 1447-CAM (SF): Basic Health Services approved for $20.0 million on 20 June 1996.

16

context of previously approved projects. The Project will have positive environmental benefits bylimiting land erosion and failure of embankments along damaged infrastructure.

17. Social Dimensions

66. Flood disasters affect the poor disproportionately in terms of health, housing, livelihood,employment, and food security. Rehabilitation of vital infrastructure will allow resumption ofcommunication links and economic activity disrupted by the floods. The rehabilitation of the KopSrov dike will involve the resettlement of about 40 houses (approximately 200 people of illegalsettlers). Compensation will also be needed for some agricultural land will be taken by the dikeconstruction. These have not yet been quantified in detail. However, ADB will assist theGovernment’s Interministerial Resettlement Committee (IRC) to prepare a draft resettlementplan based on a full census of households that will likely be affected. The plan will be preparedin accordance ADB’s Policy on Involuntary Resettlement (November 1995) and the Handbookon Resettlement: a Guide to Good Practice. Where there are differences between Governmentprocedures and ADB’s requirements, the latter will govern. The draft Resettlement Plan willinclude an entitlement matrix, an indicative budget, indicative figures on the number of personsnegatively affected by the Project, consultative mechanisms, grievance procedures,implementation procedures, and details for external monitoring and evaluation of resettlementand compensation. An independent agency acceptable to ADB will monitor and evaluateimplementation of the Resettlement Plan. For most subprojects, only minor, if any, resettlementand compensation issues are expected because rights-of-way are already established.

67. Compensation and resettlement activities associated with the Resettlement Plan will becoordinated at the national level by the IRC. The IRC will be chaired by MEF, and will includethe governor or deputy governor of each concerned province, the national project director ofMOWRAM’s project management office, representatives of other provincial authorities andministries as appropriate, and representatives from the affected districts and communes asmembers. Local level resettlement subcommittees, convened by the IRC will conduct detailedimplementation of the Resettlement Plan.

II. PROJECT JUSTIFICATION

A. Impact on Poverty and Other Benefits

68. The Project will benefit large numbers of people in flood-affected areas in Cambodia,and especially the poorer section of the population living in the rural areas. Since the Projectactivities will involve the restoration of existing facilities, the economic benefitswhile notquantified12are expected to be high especially because much lower levels of economic activitywould persist without the Project. Even without quantification, the benefits of the Project areclearly identifiable. A major benefit of the Project will be the restoration of essential transportand social infrastructure facilities. The restoration of communication links via the nationalhighway system will enable economic activity to resume and will make it easier to distributerelief supplies throughout the country. The restoration of the dike protecting Phnom Penh willbenefit all residents who would otherwise be at risk during the coming flooding season.Restoration of irrigation facilities will allow year-round agriculture production to resume as soonas possible. Rehabilitation of education facilities will permit children to resume schooling as

12 Operations Manual, Section 25, recognizes that for emergency rehabilitation projects with many subprojects,

economic internal rate of return calculations may not be possible or practical.

17

early as possible, while restoration of health facilities will allow health services to resume. Therehabilitation of ADB-assisted projects damaged by the floods will help to ensure that theprojected benefits, which could be lost due to the floods, will still accrue.

69. Rehabilitation of infrastructure, as well as other Project activities, will directly andindirectly benefit the poor. The majority of the Project works are labor intensive, localized civilworks using unskilled or semiskilled labor, and will create local purchasing power, therebycontributing to the revival of the rural economy. By building on the existing capacity buildingcomponents of ongoing ADB-assisted projects, the Project is expected to create long-termcapacity for rehabilitation and maintenance of infrastructure, especially in rural areas.

B. Risks

70. The major risk is that of delays caused by internal procedural problems in theGovernment. The Government has shown strong commitment to the Project, as it has to ADB-financed projects in general. Where procedural delays have occurred, they have beenincreasingly been solved, and implementation delay problems have diminished over the last fewyears. All five IAs have experience with ADB-financed projects, and the consultants willcompensate for the lack of capacity within the Government. Furthermore, by working as muchas possible through existing ADB-assisted projects, facilities, and consultants, the customaryinitial delays in project implementation are avoided. The risk of selecting unnecessarysubprojects and of governance-related issues is addressed by the detailed selection criteria,strong consultant support, and the provisions of ADB’s anticorruption policy, which have beenspecifically brought to the attention of the Government.

V. ASSURANCES

A. Implementation

71. The Government has agreed that it will take all measures necessary to ensure timelyand speedy implementation of the Project, including the special measures outlined in paragraph77. In this context, the PCC and the PMCU will use their authority the fullest extent possible.

72. IAs that have not managed to sign the necessary consultants, supplies, and major civilworks contracts within 18 months of the appraisal date will no longer be eligible for fundingunder the loan, and loan proceeds will be reallocated to other parts of the Project.

B. Agriculture Sector

73. While the Government had requested the inclusion of the agriculture sector in theProject, the Mission’s findings are that such support would not be suitable under the loan. TheMission agrees with the Ministry of Agriculture, Forestry and Fisheries, that there is an urgentneed to distribute rice seed. ADB and the Government have agreed that the Government willallocate up to $2 million from the funds recently released under the Agriculture Sector Programloan as counterpart funds for this loan, to purchase seeds and other necessary agricultureinputs, and start urgent small repairs to dams, weirs, and canals.

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C. Advance Action and Retroactive Financing

74. To support early implementation of the Project, advance action for the procurement ofequipment and materials, start of civil works, and the recruitment of consultants has beenapproved. The Project also provides for retroactive financing of eligible expenditures incurrednot earlier than 9 November 2000 (date of appraisal), provided that (i) the expenditures arecertified by the IAs and consultants; (ii) the certification is acceptable to ADB; and (iii) thesubprojects concerned were identified, appraised, and ready for implementation on or before 9November 2000. Retroactive financing has therefore been approved for subproject 1 of part A(urgent repairs to the national road network) and subproject 1 of part B (rehabilitation of the KopSrov flood protection dike). The Government has been advised that provision for advance actionand retroactive financing does not commit ADB to finance any part of the Project.

VI. AVAILABILITY AND UTILIZATION OF LOAN SAVINGS

75. ADB’s policy on rehabilitation assistance after disasters13 provides for the use of loansavings for rehabilitation works, subject to certain prudential restrictions. In line with that policy,and in view of Asian Development Fund resource constraints, ADB’s portfolio in Cambodia wasreviewed to determine how to maximize the resources available for rehabilitation. Thus, $12.5million has been identified for reallocation from two ongoing loans. The Government hasrequested the use of the loan savings to complement the assistance provided by the Project,and the savings will be used, specifically for restoration of the national road network and forrural roads.

76. The savings will come mainly from the Phnom Penh-Ho Chi Minh City HighwayProject,14 which is expected to be completed in late 2002. The bids for the civil works werelower than expected due to very competitive bidding and have resulted in a total savings of$13.2 million. Of this amount, it is considered prudent to use no more than $10.0 million. Theremainder will be kept in reserve to compensate for changes in the Special Drawing Rights rateand as contingency for possible cost overruns necessitated by unknown flood damage.Reallocation is also proposed from the Rural Infrastructure Improvement Project,15 which hassufficient unallocated funds available for this purpose. The project’s scope will be expanded toencompass rehabilitation works and no major change in scope will be required. In both cases,the IA will remain the same.

77. Since the utilization of loan savings is an integral part of the Project, Board approval issought. Subject to Board approval of the recommendation in paragraph 78, the loan documentsfor the two ongoing projects will be suitably revisedas requiredto reflect the necessarychanges.

VII. RECOMMENDATION

78. I am satisfied that the proposed loan would comply with the Articles of Agreement ofADB and recommend that the Board approve the following:

(i) the loan in various currencies equivalent to Special Drawing Rights42,741,000 to the Kingdom of Cambodia for the Emergency Flood

13 Operations Manual Section 25: Rehabilitation Assistance After Disasters14 Loan No. 1659-CAM (SF): GMS: Phnom Penh-Ho Chi Minh City Highway Project, for $68 million, approved on 15

December 1998.15 Loan No 1385-CAM(SF): Rural Infrastructure Improvement, approved for $25.1 million on 28 September 1995.

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Rehabilitation Project, with a term of 32 years, including a grace period of8 years, and with an interest rate of 1.0 percent per annum during thegrace period, and 1.5 percent per annum thereafter, and such other termsand conditions as are substantially in accordance with those set forth inthe draft Loan Agreement presented to the Board;

(ii) the proposed

a. changes in scope of the following projects to allow forrehabilitation of damaged infrastructure: (i) Greater MekongSubregion: Phnom Penh to Ho Chi Minh City Highway (Loan No.1659-CAM [SF]), and (ii) Rural Infrastructure Improvement Project(Loan No. 1385-CAM [SF]);

b. reallocation of loan proceeds of the two projects specified in (a) tofinance eligible costs of repair and rehabilitation; and

c. changes in implementation arrangements in connection with theaforementioned changes in scope and reallocation of loanproceeds.

TADAO CHINOPresident

28 November 2000

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APPENDIXES

Number Title Cited OnPage Para No.

1 Summary of Proposed ADB Assistance 1 3

2 External Assistance 4 20

3 Cost Estimates 7 28

4 Implementation Arrangements 9 37

5 Terms of Reference for ConsultingServices for the PMCU 10 42

6 Details of Subprojects Readyfor Implementation 12 48

SUPPLEMENTARY APPENDIX(available on request)

A. Detailed Implementation Arrangements

Appendix 121

SUMMARY OF PROPOSED ADB ASSISTANCE

Sector RehabilitationRequirements

Use of Fundsfrom LoanSavings($ million)

Funds underNew Loan

($ millions)

Total ADBAssistance

($ million)

Roads, bridges,and railways

Urgent repairs andrehabilitation of national andprovincial roads andrailways, including culvertsand bridges

10.0 30.9 40.9

Irrigation Systems Rehabilitation ofembankments, structures,and canals

0.0 7.1 7.1

Phnom Penh FloodProtection dike

Rehabilitation of the KopSrov dike

0.0 3.7 3.7

Rural Infrastructure Rehabilitation of rural roads,brides, culverts, and othersmall infrastructure

2.5 6.2 8.7

Education Repair and rehabilitation ofschool buildings andprovision of furniture andequipment

0.0 5.8 5.8

Health Repair and rehabilitation ofhealth facilities

0.0 1.3 1.3

Total 12.5 55.0 67.5

Appendix 222

EXTERNAL ASSISTANCE IN RESPONSE TO FLOODSPrincipally for Relief Operations

(as of 7 November 2000)

Source Implemented by Pledged ($)

Australia, Government IFRC/WFP 1,236,325Australia CRC 1,000Austria IFRC 21,970Brunei CRC 1,000Canada, Government WFP/IRC/UN 435,760PRC, Government CRC 31,200Denmark, Government IFRC 395,490European CommunityHumanitarian Office

IFRC 352,000

Finland IFRC 29,560France, Government CRC 19,866France CRC 1,610Germany, Government IFRC/GTZ/WFP 7,630,635Germany Caritas/IFRC/CRC 149,100Iceland IFRC 2,406India CRC 200Indonesia CRC/RGC 25,500Japan, Government CRC/RGC 381,795Japan IFRC/CRC 47,700Lao PDR CRC 354Luxembourg, Government WFP/WHO 175,600Myanmar CRC 2,100Netherlands, Government WFP/IRC 960,420Netherlands IFRC 14,400New Zealand, Government IFRC 21,500Norway, Government IFRC/UNDP 148,460Norway IFRC 10,940Philippines CRC 500UN bodies UN agencies 800,400Republic of Korea, Government RGC 20,000Republic of Korea IFRC 28,810Russia, Federation of CRC 520Singapore, Government CRC/RGC 40,000Singapore CRC 500Sweden, Government IFRC 103,000Sweden IFRC 51,500Switzerland IFRC 46,100Thailand CRC 678United Kingdom, Government IFRC 807,270United States, Government WFP/IFRC/CRC/RGC 2,718,054United States CRC 25,000Viet Nam, Government CRC 925Other in-country Various 190,021

Total 16,579,279CRC=Cambodian Red Cross, IFRC=International Federation of the Red Cross, IRC=InterministerialResettlement Committee, GTZ=Deutsche Gesellschaft für Technische Zusammenarbeit (German Agencyfor Technical Cooperation), Lao PDR=Lao People’s Democratic Republic, PRC=People’s Republic of China,RGC=Royal Government of Cambodia, UN=United Nations, UNDP=UN Development Programme,WFP=World Food Programme, WHO=World Health OrganizationSource: United Nations Development Program (UNDP).

23Appendix 3

Foreign Local CurrencyExchange (including Taxes

and Duties)

A. Civil Works

1. National Transport System 32.2 9.5 41.72. Irrigation and Flood Control 4.7 6.2 10.93. Rural Infrastructure 1.5 9.0 10.54. Education 0.6 4.3 4.95. Health 0.3 1.0 1.3 Subtotal (A) 39.3 30.0 69.3

B. Equipment and Materials1. Education 0.1 0.7 0.82. Health 0.0 0.1 0.1 Subtotal (B) 0.1 0.8 0.9

C. Consulting Services1. National Transport System 3.3 0.0 3.32. Irrigation and Flood Control 0.5 0.2 0.73. Rural Infrastructure 0.6 0.1 0.74. Education 0.9 0.1 1.05. Health 0.1 0.0 0.16. PMCU 0.6 0.0 0.6 Subtotal (C) 6.0 0.4 6.4

D. Project Support1. National Transport System 0.0 1.0 1.02. Irrigation and Flood Control 0.4 0.4 0.83. Rural Infrastructure 0.1 1.2 1.34. PMCU 0.1 0.2 0.3 Subtotal (D) 0.6 2.8 3.4

E. Support to Agriculture 0.0 2.0 2.0

F. Interest/Service Charge 1.0 0.0 1.0

TOTAL 47.0 36.0 83.0

PMCU=Project Monitoring and Coordination Unit

Source: Staff Estimates

Total Cost

COST ESTIMATES

Item

Appendix 4, page 124

IMPLEMENTATION ARRANGEMENTS

1. During appraisal, the work required was assessed in each of the six sectors covered bythe Project, and detailed implementation arrangements were agreed upon. The followingsections summarize the situation by sector and describe work to be financed under the Projectand from loan savings. More detailed descriptions are in the supplementary Appendix.

A. Roads, Bridges, and Railways

1. Damage and Impact

2. Cambodia’s total road length extends over about 34,000 kilometers (km). The primaryroad network, including national and provincial roads, extends over about 7,700 km. Only 2,700km of this length is considered all weather; most of the remaining is passable only bymotorcycles and four-wheel motorized vehicles depending largely on weather conditions. Whilesignificant progress had been made in improving the road network, the 2000 floods causedsevere damage to many parts of the network, has forced temporary social dislocation, and willrequire substantial resources to restore.

3. Severe flooding in 2000 has caused major damage to parts of the primary road networkmainly in the northeastern, southern, and western parts of the country. Although much of thewestern and southern parts of the country are still under water, the flood has started to recedeand the damage to the roads is becoming clearer. About 1,800 km of national roads have beenslightly or significantly damaged, and about 820 km of secondary, provincial town, and riverbankroads have been damaged. About 3,025 m of bridges have been destroyed or badly damaged.Severe erosion and wash outs are also in evidence.

4. The cost of repairs and rehabilitation has been estimated at $46.0 million of which about$42.8 million is for restoring damaged roads and $1.7 million for restoring/repairing damagedbridges. An additional estimated $1.5 million is needed for Royal Railways of Cambodia (RRC).Most of the emergency (phase 1) repairs, while extensive in nature, can be undertaken usinglabor and materials available in the provinces. Rehabilitation/restoration works using specializedmaterials or more sophisticated construction techniques will probably require the mobilization offoreign contractors and generally have very high priority as they are mostly on importantnational highways.

2. Project Scope

5. Part A consists of the emergency repair and rehabilitation of flood damaged nationalprimary and secondary roads and of RRC infrastructure. Consultant services under the Projectdesign (mainly for the rehabilitation works) and supervision of all subprojects’ works.

3. Description

6. Part A will cover all repair and reconstruction necessary to restore the national primaryand secondary road network and RRC infrastructure to its condition prior to the 2000 flood.Preparation of this part will be based on the detailed damage assessment conducted by theprovincial authorities and RRC staff with the actual work and necessary designs identified andprepared by consultants. Initial priorities where the extent of damage is known have beenidentified. Although these priorities will be followed for the preparation of subprojects,exceptions can be made based on the final assessment and in line with the criteria for

Appendix 4, page 225

subprojects and in consultation with the Asian Development Bank (ADB). Repairs will vary fromminor repair of an existing facilities, road culverts, or bridges to major rehabilitation.Rehabilitation work will be carried out to restore facilities to the preflood level or to a marginallyhigher standard as considered cost-effective, and where appropriate will include measures tominimize damage from future floods.

4. Cost Estimates

7. Emergency repairs under the Project (phase 1) will cost about $4.0 million equivalentand the restoration work (phase 2) will cost about $37.7 million. Additional consultant servicesand incremental administration costs will amount to $4.3 million. The foreign exchangecomponent comprises about 77 percent or $35.5 million including the interest/service charge of$1.0 million. The local currency cost is $10.5 million, or 23 percent of the total and includesduties and taxes of about $5.1 million. The cost of civil works is based on them being carried outby force account, local competitive bidding and international competitive bidding. The cost ofconsultant services (amounting to $3.3 million) covers surveys, designs, and civil workssupervision. The cost includes remuneration and other expenses; takes into consideration theduration of such services; and provides for office equipment, vehicles, office supplies, andvehicle operation.

8. ADB will finance all of the foreign exchange cost and $4.1 million equivalent of the localcurrency cost, for a total of $39.6 million equivalent, or 86 percent of the total cost. ADB willcover the entire cost, both foreign and local, for consultant services and incrementaladministrative expenses.

5. Implementation Arrangements

9. The Ministry of Public Works and Transport (MPWT) will be the Implementing Agency(IA) for this part A. Overall control will be the responsibility of one of MPWT’s secretaries ofstate. MPWT will appoint a senior engineer as a full-time project director, who will beresponsible for the day-to-day control of the project. For the work, including consultant servicesthrough funds provided under ongoing loans, existing organizational arrangements will apply.For the ongoing projects, the project management units are in place and are operating well.1

Additional staff will be needed within the units to handle the additional work required under theloan.

6. Consulting Services

10. International and domestic consultants and MPWT personnel will be needed.Considering the urgency of the Project and the need for rapid preparation and implementation,ADB has approved advance action for the engagement of consultants has been approved byADB and direct selection of consultants for part A. Conditions for direct selection include that theconsultants (i) must be currently engaged in a similar project in Cambodia, (ii) must have theexpertise needed available on short notice, and (iii) must have originally been selected for anongoing project following ADB’s Guidelines on the Use of Consultants and other arrangementssatisfactory to ADB on the engagement of domestic consultants.

1 PMU-1 is responsible for the Phnom Penh-Ho Chi Minh City Highway Project and PMU-2 is responsible for the

Primary Roads Improvement Project.

Appendix 4, page 326

11. Staffing input will be about 170 person-months of international consultants and 360person-months of local consultants and MPWT personnel. Expertise required includes projectand contract management, materials and hydrological engineering, structural engineering, andconstruction operations. The overall period of the services will be about 36 months althoughmost of the inputs are expected to be completed within 24 months. The consultants’ contractswill include facilities and services required by them including accommodation, vehicles, offices,and equipment.

12. The consultants will undertake the following tasks:

(i) Review and confirm the findings of the detailed flood damage assessment reportprepared by MPWT.

(ii) Select subprojects that generally meet the criteria previously described.

(iii) Design subprojects.

(iv) Prepare tender documents that allow for a two-envelope bidding procedure. Thefirst envelope will contain the technical qualifications of the bidder. Prior toinviting the first tender, post qualification criteria will be established and agreedupon by the Government and ADB. Screening will be undertaken to ensure thatthe contractors do not exceed their capacity to undertake the work. The secondenvelope will contain the financial bid.

(v) Prepare force account packages and related documents such as agreed ratesand work schedules, and ensure that the force account organizer has thecapability to undertake the works.

(vi) Assist MPWT to evaluate tenders and force account contracts.

(vii) Administer the civil works contracts as the engineer, as defined in the contractdocuments.

(viii) Supervise the civil works on site by providing suitable, qualified, and experiencedsupervision staff.

(ix) Certify the works and quantities achieved to the IA for payment to thecontractors.

(x) Ensure that proposed subprojects are environmentally sound and incorporatemitigation measures as appropriate to meet the Government’s and ADB’senvironment standards and regulations and to ensure that implementationcomplies with the environmental and social mitigation requirements of the civilworks contracts.

(xi) Prepare regular progress and other reports.

Appendix 4, page 427

B. Flood Control and Irrigation

1. Damage and Impact

13. The floods have affected many protection dikes and irrigation systems in the vicinity ofthe Mekong River and Tonle Sap. In normal years, a lot of infrastructure is inundated by floods,but there is rarely much damage because the infrastructure is simply submerged and notsubjected to strong flows. The flood in 2000 was unusually high and over a much longer periodthan normal. As a result, much more infrastructure was affected, and it was subjected to highand prolonged strong flows. The worst damage is concentrated along the Mekong River floodplain and in the high level breakout channels of the Mekong, particularly in Prey Veng and SvayRieng.

14. The most critical impact was on the Kop Srov dike, which protects the city of PhnomPenh from floods. The dike was in serious danger of failing for almost a month during peak floodlevels in September and October 2000. Failure would have caused disastrous flooding in thecity. In addition, more than 100 flood control and irrigation systems in 15 provinces weredamaged during the flood. At the time of appraisal, most of these were still submerged byfloodwaters, thus limiting detailed damage assessment. The assessment is being undertaken asthe floods recede.

2. Project Scope and Description

15. Part B will undertake two subprojects that require large-scale repairs.2 The most urgentis the Kop Srov Dike, which needs to be completed before the next flood season to securePhnom Penh against flooding. This subproject should be prepared for immediateimplementation so investigations and designs are already under way. The subproject is reportedin more detail in Appendix 6. The second large-scale subproject is Kandal Stung Flood Controland Irrigation System in Kandal Province, about 20 km southwest of Phnom Penh. The systemirrigates 10,000 hectares (ha) and provides flood control for the surrounding agricultural landand residential area. A number of regulating structures require repair, including one major one-gated structure. Flood dikes, canals, and irrigation service roads are also damaged. Thissubproject will be implemented over two dry seasons, although part of the flood protection workneeds to be completed before the next flood season.

16. Part B will also repair a selected number of the medium- and small-scale irrigationschemes reported as damaged by the preliminary assessment. A decision on which schemeswill be included will depend on more detailed damage assessment after the flood has recededand a process of vetting according to selection criteria agreed upon between the 1A and ADB(Supplementary Appendix). The preliminary estimated repair costs of the irrigation systems thatare reported damaged indicate that seven require medium-scale repairs, and about 100 small-scale subprojects may be considered. Repairs will include minor repair of headworks andspillways, desilting and reshaping of main and secondary canals, reinstating of canal serviceroads, and repair of side-slope erosion of small protection dikes.

2 Repairs are considered large-scale if the estimated costs exceed $1M. Medium-scale repairs are in the range of

$250,000-$1M. Both large- and medium-scale subprojects require prior approval of ADB before contracts areawarded. Repairs less than $250,000 are considered small-scale and maybe considered for ADB’s approval afteraward of contracts.

Appendix 4, page 528

3. Cost Estimates and Financing Plan

17. The cost of the rehabilitation of the Kop Srov dike is $3.7 million, and the cost of therehabilitation systems identified for ADB financing, $8.7 million, for a total of $12.4 millionequivalent. Civil works will cost $10.9 million, and the balance of $1.5 million is for consultantservices (about $0.7 million) and other support. The foreign exchange component comprisesabout 45 percent, including an interest charge of $0.1 million. The local currency cost is $6.8million equivalent, or 55 percent of the total cost, and includes $1.6 million in duties and taxes.ADB will finance all of the foreign exchange costs amounting to $5.6 million and local costfinancing amounting to $5.2 million equivalent, or a total of $10.8 million equivalent. Consultantservices will cover surveys, designs, and civil works supervision. The cost will includeremuneration and other expenses; take into consideration the duration of the services; andprovide for office equipment, vehicles, office supplies, and vehicle operation.

4. Implementation Arrangements

18. The Ministry of Water Resources and Meteorology (MOWRAM) will be the IA for theflood control and irrigation component. MOWRAM will have overall responsibility for theidentification, planning, detailed design, construction, and operation and maintenance (O&M) ofeach subproject. The implementing arrangements will follow the same model that was recentlyestablished for the ADB-assisted Stung Chinit Irrigation and Rural Infrastructure ImprovementProject (RIIP),3 for which a project management office (PMO) has been established inMOWRAM and is headed by a project director at the level of under secretary. The same PMOwill take overall responsibility for part B. For each province involved, a project implementationunit (PIU) will be established in the provincial departments of water resources and meteorologyand will be headed by the provincial director. The PIUs will prepare the small- and medium-scale subprojects and submit them to the PMO for vetting and approval. The PIUs will haveprimary responsibility for implementation under overall supervision of the PMO. The two large-scale subprojects will be prepared and implemented directly by MOWRAM. International andnational consultants will be engaged to assist the PMO and PIUs.

19. Depending upon the extent of work and the availability of the necessary experiencedprofessionals, planning, detailed design, and the preparation of tender and contract documentswould be carried out by MOWRAM and PIUs. Prequalified contractors will generally undertakeconstruction work, although scheme beneficiaries should carry out minor earthworks in tertiarycanals. Construction supervision will be the responsibility of MOWRAM for the large-scalesubprojects and the provinces for the medium- and small-scale schemes.

5. Participatory Process

20. A weakness identified with previous emergency rehabilitation work4 was the lack ofparticipation by farmers benefiting from the rehabilitation of the irrigation and drainage schemes.As a result, the investment failed to generate the foreseen increases in production, andmaintenance of the works was insufficient. This is also recognized by MOWRAM, which hasdeveloped a policy and legislation for sustainable OM of irrigation systems. The approach forPart B will emphasize the involvement of farmers in the management of the repaired works.Staff from the Irrigated Agriculture Department of MOWRAM will work closely with farmers to

3 Loan 1753-CAM(SF): Stung Chinit Irrigation and Rural Infrastructure approved on 5 September 2000 for $$16.0

million.4 Loan 1199-CAM (SF): Special Rehabilitation Assistance Project approved on 26 November 1992 for $67.7 million.

Appendix 4, page 629

form farmer water user communities (FWUCs) to manage the rehabilitated schemes. Aftercompletion, responsibility for the schemes will be transferred to the Board of each FWUC.FWUCs will continue to play a valuable role in the management and maintenance of irrigationsystems after the completion of the Project.

21. The formation of a FWUC will follow a step-by-step participatory and democraticprocess. A series of village-level forums and public meetings will be held to inform the farmersabout the aims and objectives of the rehabilitation and the policy of irrigation managementtransfer and to solicit their input on the preliminary designs. Affected farmers will be identifiedand the system beneficiaries will elect the FWUC Board. Farmer organizers will work with thefarmers to organize and manage the system O&M and collect irrigation service fees. TheFWUC will set up a committee to draft a statute setting the rules for the system and register withthe Government. After ratification of the draft statute by the farmers and acceptance by theGovernment, the MOWRAM will provide a registration certificate to the FWUC committee, toprovide it with the legal status to the system.

6. Consulting Services

22. International and domestic consultants are be required to assist and advise the PMOand PIUs. Considering the urgent nature of the Project and the need for rapid preparation andimplementation, ADB has approved advance action for engagement of consultants. Similarly,direct selection of consultants has been approved on the conditions given in para. 10.

23. Staffing inputs will include about 24 person-months of international and 110 person-months of domestic consultants with expertise in design, construction supervision, contractmanagement, and financial and economic assessment of flood control and irrigation works.Further support in project administration and financial management will be provided byconsultants already engaged under TA 3292 (footnote 3). The TA will also assist with overalldamage assessment and preparation of proposals for the two large-scale subprojects that arerequired to commence urgently. The work is 9uwithin the scope of the capacity buildingobjectives of the TA and the additional work can be handled with a short extension of existinginputs. Additional short inputs required are about one month each of two domestic consultantswith expertise in resettlement and environmental evaluation.

24. The outline terms of reference for consulting services required under the Project are asfollows:

(i) Review the detailed criteria for the selection of subprojects for implementationand refine as necessary in consultation with MOWRAM and ADB.

(ii) Review current design practices, inter alia, by comparison with similar practicesin other similar countries, and prepare simple design guidelines.

(iii) Assist MOWRAM to address environmental and social aspects, includingpreparation of resettlement plans where applicable.

(iv) Review the economic viability of typical irrigation and flood control schemes andevolve practical guidelines for adoption.

(v) Training MOWRAM staff in the design and economic guidelines.(vi) Assist the PMO to review subproject proposals submitted by MOWRAM and the

provincial PIUs, and (if necessary) recommend appropriate modifications.(vii) Review final designs of selected subprojects.(viii) Assist MOWRAM to prepare tender and contract documents and evaluate bids,

with particular emphasis on the large-scale schemes.

Appendix 4, page 730

(ix) Advise construction supervisors and spot-check the quality of materials andworks.

(x) Spot-check quantities and monthly payment certificates. For the large-scalesubprojects, counter-sign payments to contractors.

(xi) Ensure that any necessary resettlement plans are prepared and implemented.(xii) Prepare regular reports of physical and financial progress, help prepare

withdrawal applications from the loan, and prepare a project completion report.

C. Rural Infrastructure

1. Damage and Impact

a. Damage

25. The national rural road network comprises about 28,000 km. In recent years about 7,660km, of which 2,640 km are laterite roads and 5,020 km earthfill roads of lower standard, havebeen rehabilitated under various externally financed projects. Of these rural roads 1,300 km oflaterite roads and 2,000 km of earthfill roads were flooded. Of the flooded roads, about 740 kmof laterite roads (57 percent) and most earthfill roads have been damaged to various degrees.Also damaged were at least 45 bridges and 246 culverts, of which about 13 bridges and 74culverts have been completely destroyed. The total cost of repair work needed for laterite roadsis estimated at $4.0 million (roads, $3.8 million; bridges, $0.1 million; and culverts, $0.1 million).Repair works have been prioritized with cost of top priority damage at $1.82 million; secondpriority at $1.28 million; and third priority at $0.9 million. The total damage to earth roads hasbeen estimated at $8.5 million.

26. Under the ongoing RIIP5, 440 km of roads with laterite surfacing have been constructed,of which about 10 km have been completely washed out, involving repair costs of about$50,000. Damage of various levels to numerous sections of laterite or unfinished earth roadswill involve repair costs of about $150,000. Damage of RIIP roads is relatively low because oftheir good technical standards with adequate cross drainage, compaction, and surfacing.

b. Impact

27. Depending on the type of damage, transport of goods or travel is slowed to variousdegrees or halted. Water transport has often been substituted for land transport, and addssubstantially to transport time and cost. As long as roads are under water, even by only fewcentimeters, traffic must be stopped or the roads will be severely demaged. Interruption of bulktransport of goods, which is widespread, and repackaging and transport of smaller volumes andfrequent transloading, have substantial costs. Prices of goods have increased as the cost ofadditional transport and time are being added. Prices of essential commodities have sometimesdoubled due to the flood. The poor and micro-entrepreneurs are especially vulnerable to suchincreases.

28. When the water levels have dropped to at least 30 centimeter (cm) below their crest andthe surface has dried, traffic may be allowed, if urgently required. About 30 days after floodlevels have subsided, repair work can start.

5 Loan 1385-CAM(SF): Rural Infrastructure Improvement Project approved on 28 September 1995 for $25.1 million.

Loan closing date is 30 June 2002.

Appendix 4, page 831

29. The development and impact of flooding results in three distinct levels of damage to ruralroads. The first type results from a slow rise of water equally on both sides of a road, slowlyovertopping the road. This damages the upper laterite layer of the road, as compaction isweakened and aggregates are dislocated and washed out. If traffic is permitted to continue,severe damage could result. If traffic is halted, as was the case in most locations, damage islimited and repair involves resurfacing (4-5 cm) and compacting the upper laterite layer. Thecost is estimated at about $2,500 per km on average. About 50 percent of damaged roads areestimated to involve this type of damage.

30. The second type of damage occurs when elevated road sections with inadequate crossdrainage block water flows so that, after the water reaches the road’s crest, cross flowstransport materials and severely erodes one side of the road and weakens the road foundation.Repair will require digging up the road section and repairing the road bed. The average cost willbe $6,250 per km (50 percent of initial construction). About 30 percent of damaged roads areestimated to involve this type of damage.

31. The third type of damage will result from flash floods and extensive hydraulic erosion,leading to a total loss of road sections. These sections have to be fully rebuilt. About 20 percentof damaged roads are estimated to involve this type of damage.

32. Roads build to standards lower than those used under the RIIP, specificallyuncompacted earth roads, have been much more severe. Inadequate compaction duringconstruction and cross drainage make this type of roads much more vulnerable to being washedout. In a few areas, improper cross drainage has increased damage to crops and to otherinfrastructure and adjoining roads.

2. Objectives and Scope

33. The main objective of part C is to assist Cambodia to repair and restore damaged ruralinfrastructure including rural laterite and earth roads and critical infrastructure6 built under theADB-financed RIIP, and other projects. To achieve this objective, the capacity of governmentoffices and private contractors will have to be enhanced in 10 provinces in line with the provenapproach used under the ongoing RIIP. Part C will use the existing capacity of the RIIP. Phase Iof the emergency assistance and the TA requirements will be financed under the ongoing RIIP.Labor for the repair of financed by earth roads will be World Food Programme (WFP) parallelcofinancing.

34. The work will include rehabilitation of (i) damaged stretches along about 600 km oflaterite roads, (ii) about 300-500 km of earth roads, (iii) 40 bridges, and (iv) about 300 culverts.The assistance will be provided in three phases. The immediate emergency assistance will beprovided from 15 December for three months. The second phase will be the succeeding threemonths up to the next monsoon. The third phase will cover the second half of 2001 untilphysical completion of the Project by June 2003. Assistance will include purchase of equipmentfor about three provinces where force account procedures will be used. Part C will includefinancing of maintenance of completed subprojects during the second and third year.

3. Description

6 Assistance under the Project will focus mainly on repair of damages of critical infrastructure built under the RIIP

such as markets, and public buildings etc.

Appendix 4, page 932

35. Under part C, a significant portion of Cambodia’s damaged laterite road network will berestored to the preflood situation. In addition, part C will support the rehabilitation of critical andlarger damaged sections of earth roads (extending beyond 25 km on average) that had beenconstructed under WFP’s Food for Work Program with a total length of about 300-500 km. PartC will usually not include operations in communes where other agencies are expected tooperate (e.g., in Kampong Chan, Kampong Thom, and Prey Veng), except where roads extendbeyond commune boundaries.

36. In line with procedures and standards developed under the RIIP, the roads will berehabilitated using labor-intensive methods, with a focus on employing the disadvantagedpopulation of the area. Such people will be employed on a priority basis and trained inconstruction techniques. Labor-intensive construction of laterite-surfaced roads has proven costeffective and to produce roads that are easy to maintain and durable in Cambodia. Part C’s areawill include 15 of the 16 provinces that have a significant laterite road network.

37. Together with the WFP, financing will be provided for the rehabilitation of a substantiallength of earth roads. These roads had been previously rehabilitated under WFP’s regular food-for-work program. The partnership between ADB and WFP will enable the rehabilitation of theseearth roads to a higher standard (mainly compacting), so that they become more flood resistant.The co-financing from WFP will be providing temporary local employment for the poor, prior tothem being able to return to their normal livelihoods.

3. Cost Estimates and Financing Plan

38. The total cost of part C is estimated at $12.5 million equivalent, of which 18 percent($2.2 million) will be foreign exchange costs, and 82 percent ($10.3 million equivalent) is localcurrency costs. The local currency costs include $1.3 million in taxes and duties. Civil works willcost $10.5 million, and the balance of $2.0 million is for consultant services (about $0.7 million)and other support. ADB will finance all of the foreign exchange costs amounting to $2.2 millionand local costs amounting to $6.5 million equivalent, or a total of $8.7 million equivalent. WFPwill contribute food aid amounting to $2.0 million equivalent, or 16 percent of the costs. TheGovernment will contribute $1.8 million in taxes and duties. Consulting services will coversurveys, designs, and civil works supervision. The cost will include remuneration and otherexpenses; take into consideration the duration of such services; and provide for officeequipment, office supplies, and vehicle operation.

4. Implementation Arrangements

a. General Scope

39. Part C will be implemented by the Ministry of Rural Development (MRD) and itsprovincial offices (the directorates of rural development [DRDs]) over a three-year period.Provincial rural development committees (PRDCs) will help mobilize local communities andlabor. MRD will plan, finance, and monitor the progress of subprojects. The staff of theprovincial DRDs will supervise the subprojects. Local labor gangs hired under force accountprocedure or local contractors will implement the work.

40. Rehabilitation work of the first phase have been identified and scheduled. Rehabilitationwork under the second and third phases will be implemented under a sector approach. Underthis approach individual rehabilitation packages will be considered and prioritized as separate

Appendix 4, page 1033

subprojects. Such subprojects will be selected either by a provincial line agency or a group ofbeneficiaries through the village development committees or district development committeesand proposed to the PRDC of the province concerned. The PRDC will then assess thesubprojects, with the assistance of provincial DRD staff and consultants according to setselection criteria. The subproject proposals will then be submitted to MRD for possible inclusionin part C. Simple costing and feasibility studies will be prepared and, if considered viable, fundswill be provided to the PIU of the provincial government.

41. MRD will assume supervisory and monitoring capacity to ensure that implementationschedules are followed and special concerns such as beneficiary involvement, environmentalmitigation and appropriate criteria for participant selection for user training are being taken intoaccount. MRD will also monitor the O&M of the structures provided under the subprojects, aftercompletion. The actual physical design and implementation of the subprojects will be by theprovincial DRDs, with funds being supplied on an imprest basis and liquidated subsequently. Inprovinces that were not involved under the RIIP, special road sections will be selected to berehabilitated for demonstration purposes. These will be intensively supervised by theconsultants to provide hands-on training to government personnel, private contractors, andparticipating communities.

b. Project Management and Coordination Arrangements

42. Part C will be implemented under the same implementation arrangements developed forthe RIIP. The project director of the RIIP will be responsible for implementing part C under theguidance of MRD’s project coordinator. The facilities and staff of MRD’s PMO at MRD’sheadquarters at Phnom Penh will be used and expanded as required. At the provincial level, theexisting RIIP PIUs will be used. These were set up at the provincial DRD headquarters in eachprovince, headed by provincial projects managers.

43. Subproject work at the provincial level will be coordinated directly between the provincialproject managers and the provincial DRDs. These are already established and consist of allprovincial government agencies, chaired by the governor with the director of rural developmentas the vice chairman. The Government has agreed that, in the provinces involved in therehabilitation effort, provincial project managers and engineers, and technical staff will beappointed on a timely basis. These staff will undergo training beginning at least three monthsbefore their full-time involvement in the construction works in their province. At the nationallevel, part C will be implemented under the general coordination of the PCC and PCMU. MRDwill regularly inform PMCU of all subprojects to enable appropriate funding coordination.Subprojects costing more than $250,000 will be forwarded to the PMCU for endorsement and toADB for approval.

44. Because of time constraints, coordination arrangements with WFP will be developedduring implementation. Coordination mechanisms for the second phase (rehabilitation of about50 km of earth roads) will be spelled out in letters of understanding that will be issued by WFPand the Government at the latest, by the end of January 2001. Details for the cooperationduring the third phase will be agreed upon at the latest during the joint review meeting that willbe scheduled toward the end of the second phase of part C.

c. Participatory Process

45. Intended beneficiaries will be involved in selecting, constructing, and maintaining thephysical works. Staff of the provincial DRD will inform district officials and villages about

Appendix 4, page 1134

activities in their areas and solicit their support. Intended beneficiaries will be hired for skilledand unskilled labor during the implementation of the subprojects.

d. Operation and Maintenance

46. Under the RIIP and earlier under projects implemented by the International LaborOrganization (ILO), implementation arrangements and procedures for routine and periodicmaintenance have been developed.7 These mechanisms are fully operational, but formallyaccepted policy guidelines and a legal framework to support these still need to be developed.Specifically the sourcing and assurance of adequate funding is yet to be clarified. Suggestionshave been made to address this problem through such revenue-generating measures as a localtax on vehicle registration or sale of the fuel, or a toll on the rehabilitated road. The objective ofresolving this issue is included under the scope of the RIIP, and resolution has been initiated.

47. The O&M arrangements involve small-scale contract system in which the beneficiarieswho participated in the construction of the road are trained and paid to maintain a section ofroad of about 10-15 km. Materials, tools, and wages are provided under the RIIP. The systemis cost-effective (about $280/year/km) and has demonstrated satisfactory results. After threeyears of operation, and despite heavy traffic volumes, which have often exceeded originalestimations, the roads remain in satisfactory condition.

48. During the implementation period, the Project will adopt the proven method for routinemaintenance of part C subprojects and will finance maintenance costs directly to ensuremaintenance until an appropriate system is established with support under the ongoing RIIP.

e. Benefit Monitoring and Evaluation

49. The progress and impact of subprojects will be monitored and evaluated by the unitestablished at MRD under the RIIP. The staff of about five professional level people willundertake/verify (i) surveys prior to the commencement of selected subprojects following anapproved format, (ii) periodic reviews during subproject implementation, and (iii) a finalevaluation at the end of part C. Parameters to be measured will include adequacy of repairs andacceptance by the local population.

f. Special Progress Reviews

50. The first review will take place at the end of the first phase, by about 15 March 2001. Toidentify any major constraints to implementation and reassess the capacity of staff at theprovincial level, a joint meeting of the Government, ADB, WFP, and the consultant will be heldat that time. The meeting will decide on the need to review the second phase implementationarrangements or scope.

51. A second review, including a similar joint meeting (para. 49), will be held at the end ofthe second phase of part C, by about 15 June 2001, again to ensure that the scope andimplementation arrangement for the third phase of part C are adequate. In the joint meetingselection criteria and selected areas for the involvement of WFP will be refined and finalized.This will also form the basis of the formal memorandum of understanding that will be prepared

7 Routine maintenance is considered low-cost maintenance, which must be done on a regular basis to ensure

continued long-term operation of rehabilitated roads. Periodic maintenance, by contrast, involves major works andis normally undertaken once every three to five years.

Appendix 4, page 1235

the cooperating parties at that time. The meeting will (i) monitor progress of part C, (ii) diagnoseof implementation problems, and (iii) determine the extent of further assistance needed from theconsulting team by MRD to successfully complete the Project.

g. Environmental Aspects

52. Rehabilitation of roads will generally have a positive impact on the environment.Nevertheless negative impacts need to be considered in detailed designs, including effectsduring floods of inadequate culverts and unintended ponding of borrow pits. To protect againstthese impacts, adequate cross drainage of roads and borrow pits needs to be ensured, andmonitored.

5. Consultants Services and Training

53. Part C includes the services of consultants to help MRD with its implementation andcapacity building. About 35 person-months of international consultants will be needed. Theconsultants will have the following expertise and roles: (i) management and supervision ofinternationally financed projects, to serve as overall coordinator of part C, assisting MOP; (ii)management of the rural infrastructure rehabilitation component with experience concerninglabor-intensive construction of rural roads; the consultant will assist in the rehabilitation effort ona part-time basis while continuing to supervise the ongoing RIIP; and (iii) training in theplanning, quality control, construction, and maintenance of civil works, addressing Governmentand WFP staff, community workers, and core staff of local contractors; (iv) road networkanalysis and planning; and (v) project financial control and accounting. Domestic consultantinput will be about 108 person-months involving six people to assist implementation in sixprovinces. All consultants will be financed under the RIIP project.

D. Education

1. Damage and Impact

a. Damage

54. The adverse impact of the flooding on the education system, including students andteachers, is only just becoming evident. The overall damage to the education system isestimated at about $15 million but this is only preliminary figure. The Planning Departmentwithin the Ministry of Education, Youth and Sports (MOEYS) has drawn upon a number ofsources for preparing an emergency rehabilitation plan, including updates from NationalSecretariat for Disaster Management and consultations with United Nations (UN) agencies. Inaddition, MOEYS has obtained field reports from provincial directors of education andundertaken site visits to provinces. The rehabilitation plan is based on an analysis of the nearterm impact on the school system, with an assessment of the longer term rehabilitation needs.Detailed and reliable field information on the severity and coverage of flooding is still beingassembled as floodwaters recede. At least 1,000 schools in 13 provinces are severely affectedby the recent floods. The United Nations Development Programme (UNDP) estimates this figureto be around 2,000 schools, which constitute roughly half of the school system.

b. Impact

55. Based on census and geographic information system data, MOEYS estimates that theflooding has affected 1.9 million people or 21 percent of the population. The worse hit provincesare reported to be Kratie (62 percent of population affected), Kandal (40 percent), Prey Veng

Appendix 4, page 1336

(36 percent), Kampong Cham (34 percent) and Kampong Chhnang (29 percent). Many of theworst hit provinces during the 1996 flooding (e.g., Ratanakiri and Stung Treng) are not featured.Further, MOEYS estimates’ maybe conservative. For example, the UN estimates that 40percent of the population maybe affected, e.g., that 3.8 million to 4 million people may have theirlives and livelihoods disrupted by flooding. Furthermore, severe rains in early October 2000have exacerbated the scale and coverage of flood impact on the education system.

56. Factors that could prevent students and teachers from attending school include (i)damage to access roads, (ii) the need to restore family property, (iii) food shortages anddamage to water supply, and (iv) increased incidences of water-borne diseases. Furthermore,the floods could adversely impact the effectiveness of external support for educationdevelopment. Hence, rehabilitation measures are urgently needed that will minimize the risk thatexternal assistance will not have the desired effect on the education sector. Moreover, assuringhealthy pupils and teachers is another objective of the Government’s rehabilitation plan. Giventhat the school network has 5-6 times the coverage of the health clinics in the country, earlyrehabilitation of the school system will provide an opportunity to use the schools as the basis forflood-health assistance through school feeding, micronutrient supplement schemes, andantidiarreferral hospitaley initiatives.

57. In early October 2000, MOEYS appealed to the UN for emergency assistance to mitigatethe effects of the flood currently affecting many areas of Cambodia. The UN has agreed toprovide $150,0008 (to be confirmed) for temporary shelters for schools, United NationsChildren’s Fund (UNICEF) is providing $15,000 for field assessment of damage, WFP hasagreed to provide food for rehabilitation works, and the Government of the Republic of Germanyis providing $300,000 for temporary school shelters. The German assistance includes TA toestablish a disaster management unit the Department of State Assets and to assist MOP’splanning function for education facilities. The unit will be used for any future disastermanagement and will be the point of contact with the National Secretariat for DisasterManagement. The unit will also be responsible for designing an overall monitoring andperformance assessment system of the flood assistance.

58. Preliminary estimates are that between 0.3 million to 0.4 million primary school studentsare directly affected. If secondary school students are included, the figure is estimated at around0.5 million students. However, UN estimates indicate that the school population affected may beas high as 0.9 million to 1.0 million students. Including secondary schools, MOEYS estimatesthat about 7,000 classrooms have been badly affected by flooding. Using MOEYS facilitiesinventory and cost database, the cost of primary school classroom repair will range between$2.6 million and $9.9 million. In addition, about 600 classrooms in 120 secondary schools areextensively damaged. The indicative cost for secondary school classroom rehabilitation orreplacement is about $1.0 million. Thus, the total cost of classroom repair/replacement will be$3.6 million to $10.9 million. Field assessments also indicate extensive damage to schoolfurniture, including blackboards. A large amount of school supplies and textbooks has been lostor damaged beyond repair. The estimated replacement cost of furniture and school supplies isaround $3.7 million.

8 This is to cover the emergency needs to procure plastic sheets, blackboards and benches for the temporary

schools damaged but does not include and rehabilitation costs.

Appendix 4, page 1437

2. Objectives and Scope

59. The main objective of part D is to assist MOEYS to rehabilitate damaged primary andsecondary schools built under the ADB-financed the Special Rehabilitation Assistance Project(footnote 4), Rural Infrastructure Improvement Project (footnote 5), and other projects. TheMOEYS plan is to ensure that the maximum benefit is derived from this emergency schoolrehabilitation assistance in the coming months. To achieve this objective, MOEYS recognizesthe need to identify absolute priorities for repairing schools. The scope of work will include therehabilitation of (i) 105 classrooms in 24 urban primary schools, (ii) 952 classrooms in 206 ruralprimary schools, and (iii) 321 classrooms in 102 remote primary schools. In addition, 211classrooms in 35 secondary schools will be rehabilitated and furniture procured for them.

60. The aim is to institute a planning mechanism to update the impact of flooding on theschool system and to restore the operation of primary and secondary school system quickly. Atthe recently concluded National Meeting on Education, questionnaires to assess damagecaused by the flooding at provincial, district, and village levels were distributed to all provincialheads. A meeting of provincial school heads is scheduled for in mid-November 2000 to discussthe questionnaire. All questionnaires are to be submitted to MOEYS by 15 December 2000, andbased on the findings of these questionnaires, MOEYS will be in a better position to revise thecost estimates.

3. Description

61. The part D rehabilitation program will be restricted to rehabilitation of permanent andtemporary school buildings and furniture damaged by the floods, focusing on reestablishment ofthese structures. Temporary schools are those that have been in used for normal teaching butwere not constructed as permanent structures due to lack of funds. Most of such primaryschools have been completely washed out, with wooden structures badly damaged by beingunder water for a long period. In such instances, primary school structures will be completelyreplaced with concrete buildings with zinc roofing. In other cases, where the damage is not tooextensive, assistance will focus on rehabilitation. The exact works required will be determinedby the field assessment and site appraisal. Works will include selective installation of newcement floors, erection of walls, and repair of doors and windows. Site clearance andrestoration will be included. Damaged furniture and blackboards will be replaced wherenecessary.

4. Cost Estimates and Financing Plan

62. The total cost of part D is estimated at $6.7 million equivalent, of which 24 percent ($1.6million) will be the foreign exchange cost, and 76 percent ($5.1 million equivalent) the localcurrency cost. The local currency cost includes $0.9 million in taxes and duties. Civil works willcost $4.9 million, and the balance of $1.8 million is for consultants services ($1.0 million) andother equipment and materials. ADB will finance all of the foreign exchange costs amounting to$1.6 million and local cost financing $4.2 million equivalent, or a total of $5.8 million equivalent.The Government will contribute $0.9 million in taxes and duties.

Appendix 4, page 1538

5. Implementation Arrangements

a. General Scope

63. An important concern will be the capacity to coordinate aid programming for schoolrehabilitation work ongoing education facilities and construction work already scheduled inaddition to this emergency rehabilitation. Since the implementation of the Special RehabilitationAssistance Project (footnote 4), a great deal of capacity has been built within MOEYS, and itsstaff are able to plan, manage, and coordinate major construction work. In addition, otheragencies (e.g., United Nations Educational, Scientific and Cultural Organization [UNESCO],UNICEF and the European Union) have provided capacity building support that has built astrong capacity within MOEYS’ Planning Department to process and analyze information relatedto the education system and related aid projects. An ongoing European Commission project isworking to support the planning and materials and state properties departments to establishpolicy, plan education facilities development, and manage school rehabilitation and educationsystem expansion.

64. MOEYS will be the IA for the education component. MOEYS will implement part D overa three-year period. PIU will be in the Department of State Assets, School Construction Office.The day-to-day project management will be the responsibility of two MOEYS project codirectors(one responsible for technical issues and the other for financial matters). They will be located inthe Department of State Assets. An international consultant (team leader) will assist them withsupport from a team of domestic technicians, an accountant, and a draftsman-architect. MOEYShas confirmed the availability of the counterpart support staff and office space for the PIU. Theoperations will be coordinated by the director of the Department of State Assets, who will ensurethat part D is dovetailed with other ongoing school building programs, to avoid duplication andensure consistency in approach, standardized school building designs, and costs. The terms ofreference (TOR) for the PMU are given in Appendix 5.

65. MOEYS will establish a steering committee, chaired by a designated secretary of state.The steering committee members will include representatives from departments of state assets,finance, planning, administration, and primary and secondary education. The director general ofgeneral education will be the secretary. The MOEYS steering committee will includerepresentatives from the Ministry of Planning, the Ministry of Economy and Finance, andNational Secretariat for Disaster Management to ensure effective communication with thebroader project co-ordination committee (PCC) located in the Ministry of Planning (MOP).MOEYS will organize quarterly meeting with the PCC to review the quarterly progress reports ofthe education component.

b. Consultant Services

66. Part D includes the services of consultants to help MOEYS in implementation andcapacity building. The international consultant services will amount to 36 person-months, andthe consultant will have the following expertise and duties: (i) management and supervision ofinternationally financed projects, to serve as overall coordinator of part D; (ii) management ofprimary and secondary school infrastructure construction through both local competitive bidding(LCB) and community-based rural and remote school rehabilitation; and (iii) project financialcontrol and accounting. Domestic consultant input will entail about 320 person-months involving25 people to assist implementation in 13 provinces. Because of the urgency of the consultancyservices, the international consultant will be directly selected. MOEYS has agreed to provideADB with the names of four short-listed experts for consideration.

Appendix 4, page 1639

c. Field Monitoring and Impact Assessment

67. The PIU will design and implement a broad field monitoring and impact assessmentsystem. The provincial and district education offices will be trained in monitoring. Theseauthorities will be required to provide quarterly reports to the PIU. Short-term impactassessment will include analysis of restored enrolment levels, and teacher and pupilattendance. This will include disaggregation of data between urban and rural areas to give someindication of the poverty impact of the rehabilitation. The PIU will commission occasional impactstudies as part of a final impact assessment at the end of the program in 2003. These studieswill investigate the relationship between food security, public health, and rural access roads andthe school rehabilitation activities. MOEYS’ steering committee will manage the impactassessment.

d. Benefit Monitoring

68. The major beneficiaries of the program will be the less well-off in both rural and urbanareas where most of the damaged schools are located. Monitoring will examine the number ofstudents, parents, and communities who have benefited from the program. Monitoring will alsolook at how quickly students’ attendance and progression rates have been restored. Samplestudies of student and teacher performance as part of quality monitoring in the targeted areaswill be undertaken.

69. Another potential benefit is income generation through the construction and furnitureprogram. Sample studies in selected communities will look at these income benefits oncommunities and families, as part of restoring rural livelihoods. The restoration of the schoolsystem will release parents for agricultural and other income earning activities, which will beassessed as part of the broader rural livelihoods rehabilitation. The installation of flood-proofstructures is considered as an additional benefit. This could reduce the damage by flooding inthe future and provide housing for communities in future floods. Cost benefits of these newdesigns will be assessed with MOEYS’ the improved capacity to plan and manage disasters inthe future.

e. Implementation Progress Reviews

70. Joint progress reviews by the Government-MOEYS and ADB will take place every sixmonths beginning in June 2001. The reviews will include assessment of progress reports,identification of any implementation constraints, and field visits, coordinated by the MOEYSsteering committee. The reviews will also provide the opportunity to review and update workplans and the overall implementation strategy.

f. Environmental and Social Assessment

71. The environmental impact assessment indicates (i) that the overall impact of part Dshould be strongly positive, and (ii) no negative effects. The introduction of flood proof buildingstructures is an example of positive and sustainable environmental effect.

g. Participation

72. The technical and financial planning and management procedures are designed to buildon the strong tradition in Cambodia of community involvement in the design and construction of

Appendix 4, page 1740

school buildings. School parent committee and construction management committees alreadyexist. The program design, especially for technical planning and financial disbursements, willextensively use these community groups at every stage of the program cycle. The communityparticipation will ensure community leadership and ownership of the activities and contribute toassuring that communities will undertake future maintenance of buildings provided.

E. Health

1. Damage and Impact

73. The Government’s preliminary assessments indicate that some of health centers andreferral hospitals in the flooded provinces have been damaged. Data on the actual number offacilities affected are limited; however, information from the provinces indicates that about 167health centers in 16 provinces have been damaged. This estimate is based on the location ofthe health centers in the flooded areas. About 68 damaged health centers were previouslyfinanced by ADB. Flood damage is severely affecting the operation of health facilities. However,damage to the facilities includes structural damage; and damaged and stained floor tiles, walls,doors, fences, latrines, wells, hand pumps and other facilities (paths, gates, incinerators, needledisposal points, etc.). Where the damage is extensive, health services have been severelyaffected and rural populations are experiencing more health problems due to the floods.Therefore, the facilities must be restored to full operation as quickly as possible to overcome theincreasing problems.

74. In 1995, the Council for the Development of Cambodia established the National DisasterCommittee. Each ministry was required to form a disaster committee to deal with sector-specificemergencies. The disaster committee of the Ministry of Health is under the Department ofPreventive Medicine. Since the onset of flooding, this committee has been obtaining reports onflood related damage to health facilities from the 16 provinces. Although limited information isavailable on the extent of the flood damage in Banteay Meanchey, Kampong Speu, KampongThom, Pursat, and Siem Reap provinces, these areas are inundated, the water is recedingslowly, and the number of health centers in those areas likely to have been damaged has beenestimated. To confirm the estimates, the Ministry of Health (MOH) is sending questionnaires toall operational district chiefs. By end of December 2000, MOH will have a good picture on theextent of the damage and the number of health centers affected, and the cost will be revisedaccordingly. Repairs need to be undertaken quickly so that health centers can resume providingessential health care to the rural population.

2. Objectives and Scope

75. Part E will rehabilitate health centers and referral hospitals damaged by the floods,specifically facilities under the ongoing ADB loan.9 By rehabilitating the damaged health facilitiesin the 16 provinces, part E will enable the rural population in the affected areas to access tobasic health services.

76. The scope of work under part E will include mainly civil works to rehabilitate the healthcenters and referral hospitals facilities, including their wells and latrines. Damaged furniture andhospitals beds will be replaced. Part E will provide domestic consultant services to verify thedamage and costs of civil works contracts and to supervise construction.

9 Loan 1447-CAM (SF): Basic Health Services Project, for $20 million, approved in June 1996.

Appendix 4, page 1841

3. Description

77. The rehabilitation work will be restricted rehabilitation of health center and referralhospital buildings, furniture, beds, wells, and latrines. Some health center and referral hospitalbuildings have been destroyed and others have only suffered minor damage. Destroyed healthcenters and referral hospitals will be completely replaced with new concrete buildings. Wherethe damage is not extensive, assistance will focus on rehabilitation. The exact work required willbe determined by the field assessment and site appraisal. Work will include selective installationof new or repaired cement floors, walls, roof, doors, and windows. Site clearance andrestoration will also be included. Damaged furniture and beds will be replaced where necessary,including the sanitation facilities.

4. Cost Estimates and Financing Plan

78. The total cost of part E is estimated at $1.5 million equivalent, of which 27 percent ($0.4million equivalent) will be foreign exchange costs and 73 percent ($1.1 million equivalent) localcurrency costs. The local currency costs include $0.2 million in taxes and duties. Civil works willcost $1.3 million, and $0.2 million is for consultant services and $0.1 million for equipment andmaterials. ADB will finance all of the foreign exchange costs amounting to $0.4 millionequivalent and local cost financing amounting to $0.9 million equivalent, or a total of $1.3 millionequivalent. The Government will contribute $0.2 million in taxes and duties.

5. Implementation Arrangements

a. General Scope

79. An important concern will be the capacity to coordinate aid programming for schoolrehabilitation works and ongoing health services and construction work already scheduled inaddition to this emergency rehabilitation. Since the implementation of the ADB-financed BasicHealth Services Project (BHSP, footnote 9), a great deal of capacity has been built within MOHand its staff are able to plan, manage and coordinate major construction works. In addition,other agencies (World Bank, World Health Organization, and nongovernment organizations )have provided further capacity building support, which has built strong capacity within MOH.

80. MOH will be the IA for part E. MOH will implement part E over a six-month period.Arrangements under MOH’s project coordination unit (PCU) for the successful implementationof the BHSP are proposed for implementation. The PCU is fully familiar with and experienced inthe use of ADB procurement, accounting, and reporting procedures. One additional full-timeinternational consultant with qualifications and relevant experience in the implementation of civilworks will be recruited to help the PCU implement part E.

81. MOH has proposed that the project director for the BHSP will head part E and that theadministrative structure and arrangement of the PCU will be adapted to implement theassistance. The engineering supervisory firm that has been employed to manage the civil workscomponent of the BHSP will be employed through direct negotiation to provide the requiredconsultancy services. This firm has been employed since August 1997 by the PCU and hasprovided very satisfactory results for similar civil works.

82. MOH will establish a steering committee, chaired by a designated secretary of state tooversee the implementation of part E. The steering committee members will includerepresentatives from the MOP, Ministry of Economy and Finance, and National Secretariat for

Appendix 4, page 1942

Disaster Management. The PCU project director will sit on the steering committee and will haveoverall responsibility for implementing part E. The objectives of the PCU are to (i) ensure timely,efficient, and effective implementation of part E and the BHSP; and (ii) build capacity withinMOH for project administration, financial management, and procurement. The functions of thePCU will include (I) implementing policy decisions and guidelines of the steering committee, (ii)ensuring proper record-keeping of activities, (iii) ensuring timely procurement of goods andservices under the Project, (iv) supervising monitoring and evaluation activities, (v) accountingfor funds of part E, (vi) tracking implementation and remedying any delays, and (vii) assisting ineffective coordination with the projects of other funding agencies.

b. Consultant Services

83. The Project includes the services of consultants to help with implementation andcapacity building. The consultant services will amount to 6 person-months of an internationalconsultant with the following expertise and roles: (i) management and supervision ofinternationally financed projects, to serve as overall coordinator of part E; (ii) management ofhealth centers construction through both LCB and community-based rehabilitation; and (iii)financial control and accounting. Domestic consultant’s input will be about 36 person-monthsinvolving six persons to assist (i) implementation in 16 provinces, and (ii) in the preparation ofcontract documents, surveys, and supervision. In addition, a finance administrator and adraftsman will be recruited locally. Because of the urgency of the consultancy services, theinternational consultant will be directly. MOH has agreed to provide ADB with the names of fourexperts for consideration.

c. Field Monitoring and Impact Assessment

84. The PCU will design and implement a broad field monitoring and impact assessmentsystem. The district health chiefs will be trained in monitoring and will be required to providequarterly reports to the PCU. The short-term impact assessment will include analysis of restoredhealth service levels, and increase in consultations. This will include disaggregation of databetween urban and rural areas to give some indication of the poverty impact of therehabilitation. The study will determine at the relationship between food security, public health,and rural access roads on the flooded health facilities rehabilitation program.

d. Benefit Monitoring

85. The major beneficiaries of part E will be the less well off in both rural and urban areaswhere most of the damaged health centers are located. Monitoring will examine the number ofthe communities who have benefited from the program, how quickly health services wereresumed, and how this has helped contain out-breaks of water-borne diseases. Anotherpotential benefit is income generation through the construction. Sample studies in selectedcommunities will look at these income benefits on communities and families, as part of restoringrural livelihoods. The restoration of health services will also enable healthy communities toreturn quickly to agriculture and other income earning activities. This will be assessed as part ofthe broader rural livelihoods rehabilitation. The improved capacity of MOH to plan and managesuch disasters in the future will also be assessed.

e. Implementation Progress Reviews

86. The Government-MOH and ADB will jointly review progress at the end of part E,scheduled for 30 June 2001. The review will include assessment of progress reports,

Appendix 4, page 2043

identification of any implementation constraints, and effectiveness of the work plans and overallimplementation strategy. The review will entail field visits and will be coordinated by MOH’ssteering committee.

f. Environment

87. Environmental impact assessment indicates that the overall impact should be stronglypositive and not have negative effects.

g. Participation

88. To the extent possible, depending on the availability of skills, the local community will beemployed in the rehabilitation works. The community participation will ensure communityleadership and ownership of the activities and help assure that communities will maintain thefacilities provided.

Appendix 5, page 144

TERMS OF REFERENCE FOR CONSULTING SERVICES FOR THE PMCU

A. Project Management and Implementation Specialist

1. The consultant will assist staff of the Project Monitoring and Coordination Unit (PMCU) inthe Ministry of Planning with the day-to-day operations of the Emergency Flood RehabilitationProject, and, where necessary, support the five Implementing Agencies (IAs) under the Project.The ultimate responsibility of the PMCU is to ensure that the Project is implemented as plannedand within the time provided for. The tasks of the consultant will include, but not be limited to,the following:

(i) Help supervise the preparation of subprojects to ensure conformity with AsianDevelopment Bank (ADB) guidelines, and to ensure uniformity betweensubproject proposals to the extent possible.

(ii) Help review and endorse subprojects submitted by the IAs, and prepare them forsubmission to ADB.

(iii) Assist the IAs, where required, in drafting contracts, submitting them (ifnecessary) to ADB for approval, and with contract negotiations.

(iv) Assist the PMCU in establishing and maintaining a database on all subprojectsunder preparation, in the approval process, and under implementation, in order tofacilitate monitoring and enable up-to-date information to be available at any timeif so required.

(v) Advise the PMCU and IAs on ADB’s procedures and guidelines for recruitment ofconsultants and procurement, and wherever required in project implementation.

(vi) Help establish a monitoring system that will enable the PMCU to identify potentialdelays in design or implementation of subprojects.

(vii) Help establish a central database on all contracts that have been signed underthe Project.

(viii) Support the PMCU in all matters relating to aid coordination, to ensureconsistency, synergy, and conflict avoidance.

B. Financial and Accounting Specialist

2. The consultant will assist the PMCU’s counterpart staff with project accounting andfinancial administration of the Project, help them manage project accounts, and enhance theirfinancial management skills through on-the-job training. The tasks of the consultant will include,but will not necessary be limited to, the following.

(i) Assist the PMCU and IAs to apply ADB’s disbursement guidelines, disbursementguidelines including procedures for withdrawing loan proceeds and documentaryrequirements.

Appendix 5, page 245

(ii) Assist the PMCU and IAs in the drawdown of funds from ADB and the Ministry foEconomy and Finance (MEF) and facilitate the preparation of withdrawal andcommitment applications for submission to ADB and MEF.

(iii) Assist the IAs to establish and operate of project imprest accounts at the ForeignTrade Bank of Cambodia (FTBC) or any other bank acceptable to ADB;

(iv) Provide training to enable IA staff to follow ADB’s Project Accounting Manual1 whichis currently adopted by the Government for ADB project implementation.

(v) Assist the Project Implementation Units (PIUs) and Project Management Offices(PMOs) established under the project to implement an effective internal controlsystem that will not create bottlenecks to the flow of funds.

(vi) Assist the PIUs and PMOs with monthly reconciliation of account balances betweenFTBC and ADB;

(vii) Monitor the preparation of regular aging reports for funds withdrawn from imprestaccounts and still unclaimed replenishments.

(viii) Help screen withdrawal applications for completeness and accuracy, eligibility ofitems for ADB financing, classification of items by category, certification, contractreferences, supporting documents, and minimum application accounts.

(ix) Monitor the accounting and financial management systems and assist the PIUs andPMOs, as appropriate.

(x) Help ensure project accounts are audited and timely submission of audit reports toADB.

(xi) Ensure final liquidation, refund, and closing of imprest accounts in accordance withADB guidelines.

(xii) Help develop a sustainable coordination mechanism with MEF to ensure smoothfinancial operations and project implementation.

(xiii) Help all PIUs and PMOs submit consolidated timely project financial andimplementation reports.

(xiv) Assist with and carry out any financial management activities required by the Project.

1 MEF’s financial management guidelines.

Appendix 6, page 146

DETAILS OF SUBPROJECTS READY FOR IMPLEMENTATION

A. Emergency Repairs of National Transport System

1. Introduction

1. Part A of the Project is designed to implement repair and restoration works in twophases. Phase one involves emergency or immediately necessary repairs to the road sections,bridges, and railway facilities damaged by the year 2000 floods. The objective is to restore basicaccess to the populations served by the facilities and to allow the flow of commerce and peoplethat has been disrupted by the floods. Generally the work will not be a permanent standard butwill be suitable for temporary purposes. Although floodwaters have not subsided completely inall areas or along all section of the roads or railways, much of the damage can be observed andthe extent identified. Some of these work had commenced at the time of appraisal while othersare expected to start soon.

2. Extent of Damage

2. Table A6 shows the road sections with major damage that must be repaired immediatelyto restore access and function:

Table A6: Initial Assessment of Emergency Repairs

Route Number (RN) Area Damaged Type of Damage Estimated CostKilometer Post (PK) ($1000)

RN 1 PK 48-49 160 m breach 40.0PK 53 41 m breach 10.0PK 62-63 50 m breach 15.0PK 64-65 220 m breach 50.0PK 81-82 496 m breach 100.0

RN 2 PK 19-20 30 m severe erosion 10.0PK 120-125 5,000 m severe erosion 375.0

RN 4 PK 47 100 m severe erosion 25.0

RN 5 PK 145-157 Severe erosion identified 900.0PK 170-182 Severe erosion identified 900.0

RN 6 PK 183-185 Breach and severe erosion 300.0PK 217-218 Breach and severe erosion 150.0PK 221-228 Breach and severe erosion 1,050.0

RN 11 PK 71-73 101 m breach 25.0PK 75-79 233 m breach 5.0

Total 4,000.0Source: Staff Estimates

Appendix 6, page 247

3. Implementation Arrangements

3. Ministry of Public Works and Transport (MPWT) will be the Implementing Agency for partA and overall control will be the responsibility of one of MPWT’s secretaries of state. MPWT willappoint a senior engineer as a full-time project director, responsible for the day-to-day control ofthe part A. For work (including consultant services) to be funded under ongoing loans, existingorganizational arrangements will apply. For the ongoing projects the project management units(PMUs) are in place and are operating well.1 Additional staff will be needed within the units toaugment staff to handle the additional work required under the loan as well as Royal Railwaysof Cambodia (RRC) staff.

4. Procurement

4. All goods and services under the Project will be procured in accordance with theGuidelines for Procurement of the Asian Development Bank (ADB). Given the urgency of theProject, at the request of the Government, ADB approved advance procurement action with theunderstanding that such action does not commit ADB to finance any part of the Project.Similarly, ADB has approved retroactive financing. To expedite procurement procedures, theGovernment requested and ADB agreed to adopt a two-envelope procedure for internationalcompetitive bidding (ICB) and local competitive bidding (LCB) procurement. Procurementperiods will also be reduced to 21 days for LCB contracts and 60 days for ICB tenders.

5. Following the procedures established under Loan 1697-CAM2, all civil works contractsfor the rehabilitation of roads and bridges, with a value of $2.5 million or more, will be awardedon the basis of ICB procedures. For suitable contract packages under $2.5 million, LCBprocedures will be followed. The rationale is that ICB contractors will only be interested in thelarger continuous civil works contracts while the local contractors, including internationalcontractors already working in Cambodia, could be interested in contracts in scattered locations,some with security problems. Force accounts will also be allowed particularly for small,scattered civil works where it is difficult to prepare logical contract packages mainly because ofthe piecemeal nature of the civil works.

6. Force account works will be undertaken on the basis of detailed technical specifications,bills of quantities, and schedules of rates, and will be supervised by the construction supervisionconsultants. The groups responsible for each force account package will be required to provideschedule that requires the agreement of MPWT and the consultant. Payment for force accountworks will be against agreed criteria for verification and acceptance of the works. This willensure accountability for the quality and cost of the works carried out.

5. Consulting Services

7. International and domestic consultants and MPWT personnel will be needed.Considering the urgency of the Project and the need for rapid preparation and implementation,advance action for the engagement of consultants has been approved by ADB. Similarly, directselection of consultants for part A has been approved. Conditions for direct selection include theconsultant (i) must currently be engaged in a similar project in Cambodia, (ii) must have theneeded expertise available on short notice, and (iii) must have originally been selected for an

1 PMU-1 is responsible for Loan 1659-CAM: Phnom Penh-Ho Chi Minh City Highway Project and PMU-2 is

responsible for Loan 1697-CAM (SF): Primary Roads Restoration Project.2 Loan 1697-CAM (SF): Primary Roads Restoration Project, approved for $68.0 million on 21 September 1999.

Appendix 6, page 348

ongoing project following ADB’s Guidelines on the Use of Consultants. Two joint ventureconsulting firms have been contracted under ongoing ADB-financed projects. These firms withappropriately amended contracts will be retained to assist MPWT with identifying and preparingsubprojects and supervising the emergency repairs and civil works construction and relatedactivities.

6. Environmental and Social Impacts

8. Subproject criteria specify that repairs and rehabilitation work will be undertaken withinthe existing alignments and will, therefore, be very unlikely to have any adverse environmentalimpacts. Nevertheless, subproject preparation will include a initial environmental examinationand an initial social assessment that will require ADB approval prior to the acceptance of thelarger subprojects ($250,000 or more) or later approval for the smaller ones (less than$250,000).

7. Estimated Cost and Schedule

9. Emergency repairs are estimated to cost a total of $4.0 million. The repairs will beundertaken during the 2000-2001 dry season expected to occur from November 2000 to July2001.

B. Kop Srov Flood Protection Dike

1. Background and Description

10. The city of Phnom Penh is protected by more than 40 kilometers (km) of flood dikes thatsurround the city. A 7 km section known as the Kop Srov Dike on the northern side of the citywas at high risk of failure for about a month during the 2000 floods. The dike was initially built in1972-1973 and has two important functions: flood protection and as a road for heavy traffic tobypass the city.

11. In 1996, under the management of Phnom Penh Municipality, a contract was let to aprivate contractor to raise and enlarge the dike. The work was done at the contractor’s expensein exchange for concession rights to collect fees from trucks using the dike road. Theimprovement consisted of dumping a layer of poor structural soil on top of the dike. The contractis now over, and PPM has resumed collecting fees. During the floods, it became obvious thatthe standard of the upper layer was inadequate to provide safe flood protection of the city.During the flood, numerous seepage lines developed and the dike had to be placed under 24-hour surveillance to detect seepage points. Seepage through the embankment is particularlydangerous, as it could quickly lead to a breaching failure. Wave action was also a majorconcern, causing extremely rapid erosion; fortunately it occurred for a day. Had it lasted longer,the dike probably would have collapsed.

12. In view of the importance of the dike for protecting Phnom Penh, it has been placedunder the responsibility of the Ministry of Water Resources and Meteorology (MOWRAM).MOWRAM undertook the emergency work need to prevent failure during the flood. A fleet ofearth moving equipment and sandbags were used to undertake temporary emergencymeasures to prevent water from flowing over the dike, plug more than 70 seepage points, andcontrol severe erosion due to the wave action.

Appendix 6, page 449

2. Long-Term Plans

13. MOWRAM has requested assistance from the Government of Japan for a major upgradeof the total Phnom Penh dike system. Since the dike is now is the main route for trucksbypassing the city, the road will be enlarged and fully asphalted. Its function as a floodprotection dike will also be upgraded. The overall cost is estimated at $30 million. Japan has notyet made a firm commitment to fund the project. Even if the work proceeds, the feasibility studyand design work typically take two years before construction can be started. The project is notexpected to commence earlier than 2002. Thus, the emergency repairs are needed to securethe dike for at least the next two flood seasons.

3. Proposed Emergency Work

14. MOWRAM has requested emergency assistance to strengthen a 7 km section of thedike and hence protect Phnom Penh. The emergency repairs include raising the height, placingan impervious clay blanket on the upstream side to safeguard against failure, and providingprotection against waves.

15. The dike’s current height varies from elevation 10.08 meters (m) to 10.88 in the criticalsection from National Route 5 to the temple Wat Ang Krapeu. This compares with the peakwater level during the flood of 10.40 along the section. The width of the road is approximately 10meters for the first 1.7 km from route 5, then narrows to approximately 8 until the temple.Although the initial 1.7 km section was affected by during the flood, it was satisfactorilyprotected by sandbags and by vegetation cover on the upstream side that protected the sectionfrom wave action.

16. The proposal for this section is to remove the 1996 soil (approximately 0.5 beneath thecrest of the road), trim it back to the original well-compacted core, and replace it with well-compacted soil with better structural characteristics while raising the crest to 11.40 m. Furtherin, a compacted clay layer will be placed on the upstream slope and then both sides will becovered with topsoil that will be grassed. Under the emergency repairs, the crest will be pavedwith laterite for suitable for heavy truck traffic.

17. The remaining section (approximately 5.2 km) is more critical because it sustained moredamage and was in the most danger of collapse. During the flood, layers of sandbags wereplaced on the upstream slope and in some lower sections a single row of sandbags were placedto raise the level to just above 10.40. Much of the poor uppermost layer of soil was cracked.

18. Waves estimated at 0.6 m flowed over sandbag layer in some sections. For this section,the plan is again to remove the soil layer that was placed during the 1996 improvements, trimback to the original core, replace it with material of acceptable structural qualities, and raise thecrest to 11.40 m. An impervious compacted clay layer will be placed on the stream side. Thiswill be then covered with rock protected with a geotextile filter from the toe of the foundation up2.2 m. Above that will be reinforced concrete slab with a concrete wall on top. The road sectionwill repaved with laterite. The downstream slope will be formed of newly compacted soil with agrassed layer on top to protect against erosion.

4. Preparation of Survey and Designs

19. MOWRAM has done a complete survey of the dike and taken eight soil cores. Analysisrevealed that the core of the dike is sound. This is supported by observations during high water

Appendix 6, page 550

levels, whereas there was infiltration through the core. The design drawings have beenprepared by MOWRAM and a typical section is shown in attached Figure A7.1. Consultantsunder TA 32923 will review the designs and prepare a detailed report on the subprojectproposal, which will be submitted to ADB for approval.

5. Cost Estimates

20. The detailed cost estimates have been prepared by MOWRAM and amount to $3.7million. These will be reviewed during preparation of the report to be submitted to ADB.

6. Social and Environmental Issues

21. The work will require relocation of about 40-50 illegally settled households that areimmediately adjacent to the one section of the dike. Compensation for some loss of agriculturalland will also be required. MOWRAM will prepare a resettlement plan in accordance withGovernment procedures and acceptable to ADB. The Government has agreed to cover theassociated resettlement and compensation costs. An initial environmental examination of thesubproject will also be undertaken.

3 TA 3292-CAM: Capacity Building at the Ministry of Water Resources and Meteorology approved for $796,000 on

10 November 1999.