The World Bank FOR OFFICIAL USE ONLY · PROJECT APPRAISAL DO CUMENT ON A PROPOSED CREDIT ... CAG Controller and Auditor General ... Insufficient performance of the overall local government

Document of The World Bank

FOR OFFICIAL USE ONLY

Report No: 57162-TZ

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED CREDIT

IN THE AMOUNT OF SDR 25 MILLION (US$38.0 MILLION EQUIVALENT)

TO THE

UNITED REPUBLIC OF TANZANIA

FOR THE

ZANZIBAR URBAN SERVICES PROJECT

January 28, 2011

Urban and Water Unit Sustainable Development Department Country Department AFCE1 Africa Region

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

ii

CURRENCY EQUIVALENTS

(Exchange Rate Effective November 30, 2010)

Currency Unit = Tanzanian Shillings 1 T Sh = US$0.0006 US$ 1 = TSh 1,517

FISCAL YEAR

July 1 – June 30

ABBREVIATIONS AND ACRONYMS AFTUW Africa Technical Unit Urban and Water AKTC Aga Khan Trust for Culture ARAP Abbreviated Resettlement Action Plan AWPB Annual Work Plans and Budgets CAG Controller and Auditor General CAS Country Assistance Strategy CPIA Country Policy and Institutional Assessment DG Director General DISP Diagrammatic Indicative Structure Plan DoLR Department of Lands Registration DP Development Partners DSDSW Division of Sewage, Drainage and Solid Waste DoSUP Department of Survey and Urban Planning EA Environmental Assessment EMP Environmental Management Plan ESIA Environmental and Social Impact Assessment ESMP Environmental and Social Management Plan FM Financial Management FMM Financial Management Manual FMR Financial Management Report GDP Gross Domestic Product GoT Government of Tanzania IBRD International Bank for Reconstruction and Development ICOMOS International Council on Monuments and Sites IDA International Development Association IFMS Integrated Financial Management System IRA Institutional Review and Analysis IRR Internal Rate of Return IS Implementation Support ISP Institutional Strengthening Plan JAST Joint Assistance Strategy for Tanzania KfW Kreditanstalt für Wiederaufbau (German Development Bank) MDAs Ministries, Departments, Agencies MDGs MoF

Millennium Development Goals Ministry of Finance (United Republic of Tanzania)

iii

MWCEL Ministry of Water, Construction Energy and Lands MLHWE Ministry of Lands, Housing, Water and Energy O&M Operation and Maintenance ORAF Operational Risk Assessment Framework PBA Performance-Based Allocation PCC Project Coordination Committee PDO Project Development Objective PEFAR Public Expenditure and Financial Accountability Review PFM Public Financial Management PFMRP Public Financial Management Reform Program PIM Project Implementation Manual PIP Project Implementation Plan PMT Project Management Team PO-FEDP President’s Office – Finance, Economy and Development Planning PO-RCLG President’s Office – Revolutionary Council and Local Government PP Procurement Plan PPA Project Preparation Advance PPAA Public Procurement Appeals Authority PPRA Public Procurement Regulatory Authority PRSC Poverty Reduction Support Credit PS Principal / Permanent Secretary RGoZ Revolutionary Government of Zanzibar SIL Specific Investment Loan STCDA Stone Town Conservation and Development Authority SW Solid Waste TC Town Council TSCP Tanzania Strategic Cities Project T Sh Tanzanian Shillings UNESCO United Nations Educational, Scientific and Cultural Organization USD US Dollar WBI World Bank Institute WHC World Heritage Committee ZMC Zanzibar Municipal Council ZPSRP Zanzibar Public Service Reform Program ZRB Zanzibar Revenue Board ZSDP Zanzibar Sanitation and Drainage Program ZSGRP Zanzibar Strategy for Growth and Reduction of Poverty ZUSP Zanzibar Urban Services Project

Regional Vice President: Obiageli K. Ezekwesili Country Director: John M. McIntire

Sector Director: Sector Manager:

Jamal Saghir Junaid K. Ahmad

Task Team Leader: Barjor E. Mehta

iv

TANZANIA Zanzibar Urban Services Project

CONTENTS

Page I. Strategic Context ...........................................................................................................1

A. Country Context .....................................................................................................1

B. Sectoral and Institutional Context ............................................................................1

C. Higher Level Objectives to which the Project Contributes........................................3

II. Project Development Objective .....................................................................................3

A. The Project Development Objective (PDO) .............................................................3

B. Project Beneficiaries ...............................................................................................3

C. PDO Level Results Indicators .................................................................................3

III. Project Description ........................................................................................................4

A. Project Components ................................................................................................4

B. Project Financing ....................................................................................................7

C. Lessons Learned and Reflected in the Project Design ..............................................8

IV. Implementation .............................................................................................................8

A. Institutional and Implementation Arrangements .......................................................8

B. Results Monitoring and Evaluation..........................................................................9

C. Sustainability ..........................................................................................................9

V. Key Risks and Mitigation Measures ........................................................................... 10

VI. Appraisal Summary .................................................................................................... 11

A. Economic Analysis ............................................................................................... 11

B. Technical .............................................................................................................. 11

C. Financial Management .......................................................................................... 12

D. Procurement ......................................................................................................... 13

E. Social and Environment ....................................................................................... 13

Annex 1: Results Framework and Monitoring ..................................................................... 17

Annex 2: Detailed Project Description ................................................................................. 19

Annex 3: Implementation Arrangements ............................................................................ 27

Annex 4: Operational Risk Assessment Framework (ORAF) .............................................. 38

Annex 5: Implementation Support Plan ............................................................................... 41

Annex 6: Team Composition................................................................................................. 43

Annex 7: Economic and Financial Analysis .......................................................................... 44

Annex 8: Environmental and Social Impact Assessments .................................................... 50

v

TANZANIA ZANZIBAR URBAN SERVICES PROJECT (ZUSP)

PROJECT APPRAISAL DOCUMENT

AFRICA

AFTUW

Date: January 28, 2011 Country Director: John M. McIntire Sector Director: Jamal Saghir Sector Manager: Junaid K. Ahmad Team Leader(s): Barjor E. Mehta Project ID: P111155 Lending Instrument: Specific Investment Loan

Sector(s): General water, sanitation and flood protection (45%), Solid waste management (45%), Sub-national government administration (10%). Theme(s): Access to urban services and housing (50%), Municipal finance (25%), Other urban development (25%) EA Category: A -- Full Assessment

Project Financing Data: Proposed terms: The Credit will have a total maturity of 40 years including a grace period of 10 years.

[ ] Loan [ X ] Credit [ ] Grant [ ] Guarantee [ ] Other:

Source Total Amount (US$M) Total Project Cost:

Cofinancing: Borrower: Total Bank Financing:

IBRD IDA

New

Recommitted

38.0 0.0 0.0 38.0

38.0

Borrower: United Republic of Tanzania, Ministry of Finance

Responsible Agency: President’s Office-Finance, Economy and Development Planning, Revolutionary Government of Zanzibar

Contact Person: Mr. Ameir Ali Khatib, ZUSP Project Coordinator Telephone No.: +255 24 223 5128 Fax No.: +255 24 223 5129 Email: [email protected]

mailto:[email protected]�

vi

Estimated Disbursements (Bank FY/US$m)

FY 2011 2012 2013 2014 2015 2016 Annual 1.4 9.2 15.9 8.1 2.4 1.0

Cumulative 1.4 10.6 26.5 34.6 37.0 38.0

Project Implementation Period: Start: February 24, 2011 End: June 30, 2016 Expected effectiveness date: June 30, 2011 Expected closing date: June 30, 2016

Does the project depart from the CAS in content or other significant respects? No If yes, please explain: NA

Does the project require any exceptions from Bank policies? Have these been approved / endorsed (as appropriate by Bank management? Is approval for any policy exception sought from the Board?

No NA No

If yes, please explain:

Does the project meet the Regional criteria for readiness for implementation? Yes If no, please explain: NA

Project Development Objective: Improve access to urban services in Zanzibar and conserve the physical cultural heritage at one public location within the Stone Town.

Project description: The project will have three components. Component 1 will strengthen institutional capacity of the Zanzibar Municipal Council (ZMC) and develop infrastructure such as surface water drainage systems, solid waste collection and transportation, street lights and a sea wall including a promenade within the World Heritage City location of the Stone Town. Component 2 will support the Town Councils of Chake Chake, Mkoani and Wete on Pemba Island by strengthening their institutional capacity and through the identification and implementation of simple and small investments. Component 3 will support project management.

Safeguard policies triggered? Environmental Assessment (OP/BP 4.01) Natural Habitats (OP/BP 4.04) Forests (OP/BP 4.36) Pest Management (OP 4.09) Physical Cultural Resources (OP/BP 4.11) Indigenous Peoples (OP/BP 4.10) Involuntary Resettlement (OP/BP 4.12) Safety of Dams (OP/BP 4.37) Projects on International Waters (OP/BP 7.50) Projects in Disputed Areas (OP/BP 7.60)

Yes No No No Yes No Yes No No No

vii

Conditions and Legal Covenants: Financing Agreement Reference Description of Condition/Covenant Date Due

Article V, 5.01 (a) The Subsidiary Agreement has been executed on behalf of the Recipient and the Project Implementing Entity.

Effectiveness

Article V, 5.01 (b)

The Project Implementing Entity has adopted and furnished to the Association the PIM, in a form and substance satisfactory to the Association and the Recipient.

Effectiveness

Schedule 2, Section V

(a) The Recipient shall, carry out jointly with the Association and the Project Implementing Entity, a Mid-Term Review of the progress made in carrying out the Project, under terms of reference acceptable to the Association;

(b) At Mid-Term Review assess, inter

alia: (i) the overall progress made during the implementation of the Project; and (ii) the results of the monitoring and evaluation activities carried out in connection with the Project; and

(c) No later than thirty (30) days after the completion of the Mid-Term Review, ensure the commencement of implementing the recommendations of the Mid-Term Review as agreed with the Association.

Within 30 months of the Effective date, or by such other date as may be agreed by the Association

1

I. Strategic Context A. Country Context 1. Zanzibar is part of the United Republic of Tanzania but has its own legislative assembly known as the House of Representatives, an executive headed by the President of Zanzibar and its own judicial system. Two main islands make up Zanzibar -- Unguja (area: 1,666 square kilometers, 2002 population1

2. The Zanzibar Strategy for Growth and Reduction of Poverty (ZSGRP), is the Revolutionary Government of Zanzibar’s (RGoZ) development road map to meet the Zanzibar Vision 2020 objectives aimed at eradicating absolute poverty in Zanzibar by the year 2020. The strategy coincides with the attainment of the Millennium Development Goals (MDGs) by 2015 and recognizes the need to develop institutions and methods to support rapid expansion of services across the islands. One of the identified key challenges is the capability of local government in Zanzibar to contribute effectively to delivery of services. To address these challenges, the Zanzibar Public Service Reform Program (ZPSRP) devotes significant attention to local government reforms in its five-year Medium Term Strategy (2010/2011 to 2014/2015). However, while there is agreement within the government that effective decentralization and strengthening of local governments is essential, at this time there is no concrete proposal or plan on how this would be implemented.

: 622,459 persons; 2010 estimate: 745,000) and Pemba (area: 988 square kilometers, 2002 population: 362,166 persons; 2010 estimate: 423,000).

B. Sectoral and Institutional Context 3. The current system of local government in Zanzibar has inappropriate institutional arrangements due to duplication or unclear assignment of responsibilities, very limited authority or resources transferred to elected local governments, lack of local accountability and appropriately trained personnel. Insufficient performance of the overall local government system is reflected in the capacity challenges faced by the Zanzibar Municipal Council (ZMC) on Unguja Island and the three Town Councils on Pemba Island.

4. In 2002, ZMC had a population of 206,292 persons with another 113,611 persons living in the adjoining urban area of West District. On Pemba Island, there are three Town Councils, namely, Chake Chake (19,283 persons), Wete (24,983 persons), and Mkoani (12,175 persons). Together, the four main urban areas on the two islands are estimated to contribute the bulk of Zanzibar’s GDP making them critical to the economy of the two islands. Tourist arrivals on the island increased by 8 percent between 2005 and 2009 with Zanzibar receiving 135,000 tourists in 2009, making tourism one of the most important economic activities on the islands. Most, if not all, tourists visit or at least stay for a short period within the ZMC area to visit the Stone Town which is a United Nations Educational, Scientific and Cultural Organizations (UNESCO) declared World Heritage City. 5. Public infrastructure within the World Heritage City of the Stone Town is in a dilapidated condition. A major section of the sea side Mizingani Road, the historic centre and the public face

1 National Bureau of Statistics, 2002 Population and Housing Census

2

of the city’s tourist district is in danger of collapse. Substantial areas of the ZMC are very dense, unplanned and informally developed, with poor access to services. Around 173 hectares in the Ng’ambo areas (outside of the Stone Town) within the council suffer from severe and persistent flooding. Given the coastal location with sharp concentrated rainfall bursts, coupled with a shortage of effective drainage, more than 3,600 houses are affected or damaged annually. Flooding also results in damage to road infrastructure, interruptions to water and electricity supply, and increases the risk of the spread of water borne diseases, including cholera. Only around 45 percent of the solid waste generated within the ZMC area is collected and transported to a waste disposal site. While ZMC is now able to collect garbage from the Stone Town on a daily basis, there is limited collection in the Ng’ambo areas. Uncollected waste compounds the problems of flooding. There is a general lack of street lights. While dark streets in the narrow lanes of the Stone Town hinder tourist activity, dark areas along poorly maintained or unpaved and flooded roads in the Ng’ambo areas pose safety risks to the population.

6. Several development partners are supporting improvements in urban services in Zanzibar. Since 1994, Kreditanstalt für Wiederaufbau (KfW) has assisted ZMC in implementing two phases of the Zanzibar Sanitation and Drainage Program (ZSDP) which has led to the development of a network of surface and underground drainage in all areas of the Stone Town and its immediate periphery. The Government of Finland is assisting the Ministry of Water, Construction, Energy and Lands (MWCEL) in establishing a multipurpose cadastre which has the potential to help ZMC establish a municipal revenue management system. The Aga Khan Trust for Culture (AKTC) is actively involved in helping the Stone Town Conservation and Development Authority (STCDA) and ZMC to redevelop Forodhani Park which is a prominently located public space along the sea-side of the Stone Town and to conserve several historic buildings.

7. Unlike on mainland Tanzania, the World Bank has not been previously involved in the urban and local government sector in Zanzibar. However, the World Bank is engaged in a limited manner together with other development partners in the preparation of the ZPSRP which places emphasis on decentralization and other related policies to be implemented over the 2010 to 2015 period.

8. While decisions on decentralization policies and new institutional arrangements are being debated and formulated, the urban centers on Unguja and Pemba Islands continue to grow in terms of their populations as well as physical extents. Regardless of the specifics of the decentralization policies adopted by the RGoZ, ZMC on Unguja Island and the Chake Chake, Wete and Mkoani Town Councils on Pemba Island are expected to continue functioning and delivering municipal services to their expanding populations. Strengthening these institutions and providing much needed basic municipal infrastructure cannot wait for decentralization policies to be put in place.

9. Zanzibar Urban Services Project (ZUSP) was prepared in response to a request received from the Government of Tanzania in July 2008 to assist in the improvement and development of services in ZMC and the three Town Councils on Pemba Island. ZUSP is also consistent with the current urban and local government lending pipeline and the Country Assistance Strategy (CAS) of the World Bank in Tanzania where specific municipal investments are being put in place

3

together with parallel initiatives funded directly by the Bank or other development partners which deal with local government policy and institutional change.

C. Higher Level Objectives to which the Project Contributes 10. The project is well aligned with the Zanzibar Strategy for Growth and Reduction of Poverty (ZSGRP, or MKUZA) which is RGoZ’s development plan to meet the Zanzibar Vision 2020 objectives and MDGs which recognize the need to develop institutions and methods capable of rapid expansion of services across the islands. The strategies outlined in the ZSGRP for achieving the targets are: a) integrated approach of sanitation, hygiene education and environmental management; b) demand responsive approach, with beneficiary contributions; c) decentralized approach; d) system sustainability, based on the community’s responsibility; e) financial viability, through sound financial practices; f) co-ordination and collaboration of the major actors; g) private sector participation; and h) monitoring and evaluation. The recently approved MKUZA II puts similar emphasis on and further strengthens the above mentioned strategies. The World Bank’s Country Assistance Strategy Progress Report (World Bank 2010), which assesses the implementation of the World Bank’s FY2007-10 Country Assistance Strategy for Tanzania, outlines the main adjustments to the Bank’s lending program including a strategic scaling up of financing to the infrastructure sectors, including the urban sector. Several new projects such as the Tanzania Strategic Cities Project (TSCP) and the ZUSP were added to the lending program. II. Project Development Objective A. The Project Development Objective (PDO) 11. The PDO is to improve access to urban services in Zanzibar and conserve the physical cultural heritage at one public location within the Stone Town. 12. This will be achieved by: a) provision of storm water drainage within ZMC outside of the Stone Town; b) collection and transportation of solid waste; and c) construction of the Mizingani sea wall and associated promenade within the Stone Town. B. Project Beneficiaries 13. While the project will directly benefit the population living within the jurisdictions of the ZMC (2002 population: 206,292 persons) and the three Town Councils on Pemba (2002 population: 56,441 persons) investments made will indirectly benefit the entire population of Zanzibar (2002 population: 984,625 persons) because the four urban areas are the hubs for all economic and cultural activities on both islands. C. PDO Level Results Indicators 14. Achievement of the PDO will be measured by: a) households reporting flooding inside homes in ZMC project area2

2 Core Indicator for the Urban Sector

; b) people in urban areas (ZMC) provided with access to regular

4

solid waste collection under the project3; c) the Stone Town retains status of World Heritage City; and d) direct project beneficiaries (number) of which females (%)4

.

III. Project Description

A. Project Components 15. The project will have three components with an estimated cost of US$38.0 million, which will be financed 100 percent by IDA. A brief description of the project components is set out below. A detailed description of the components is provided in Annex 2. 16. Component 1: Institutional Strengthening and Infrastructure Development in the Zanzibar Municipal Council (ZMC) Area (US$31.2 million). This component will focus on ZMC on Unguja Island and will comprise of six subcomponents:

(i) Institutional Strengthening of Zanzibar Municipal Council (US$4.3 million). This subcomponent will support the strengthening of the management and operational capacity of the ZMC through: a) technical assistance for the preparation and implementation of a change management strategy; b) technical assistance for improving financial management, procurement and revenue collection; c) technical assistance for improving ZMC’s interface with citizens; d) technical assistance for preparing the renovation projects for the ZMC office and workshop; e) procurement of works for repair and rehabilitation of the ZMC office and workshop buildings; f) procurement of goods for re-tooling ZMC; and g) training of ZMC staff.

(ii) Preparation of a Diagrammatic Indicative Structure Plan5 for ZMC and its immediate periphery (US$2.2 million). This subcomponent will support the Department of Survey and Urban Planning (DoSUP) in the Ministry of Lands, Housing, Water and Energy (MLHWE)6

(iii) Construction of storm water drainage channels in the areas outside of the Stone Town (US$10.8 million). This subcomponent will enable the construction of 19.631 kilometers of surface water drains and related works within and in the immediate periphery of the ZMC in areas outside of the Stone Town. Six separate surface water drainage systems

with: a) technical assistance for the preparation of a diagrammatic indicative structure plan for the ZMC and its immediate periphery to inform future growth decisions, including the establishment of effective information flows and coordination with the Department of Lands and Registration (DoLR), ZMC and other related agencies; as well as the establishment of an effective physical development monitoring and management system; b) technical assistance for the preparation and roll-out of community communication campaign; c) procurement of office equipment; and d) training of DoSUP staff.

3 Core Indicator for the Urban Sector 4 Core Indicator for IDA 5 A Diagrammatic Indicative Structure Plan (DISP) is not a statutory physical development plan. No plot level decisions are to be

included. As the name suggests, the DISP will be developed such that it can provide long term directions to decision makers working in different sectors such as roads, water supply, sewerage etc.

6 Previously known as Ministry of Water, Construction, Energy and Lands (MWCEL)

5

will be constructed with a total catchment area of around 1,698 hectares eliminating persistent stagnant water ponds of over 170 hectares which affect more than 20,000 persons living in and around 3,645 houses. Detailed engineering designs and draft construction tender documents have been completed. Based on experience gained during implementation of earlier drainage improvement works in Zanzibar under KfW financing, ZMC proposed during the appraisal mission to have one works contract for the construction of the planned six drainage systems, with implementation supervision assistance provided. This has been agreed and reflected in the procurement plan.

(iv) Design and installation of street lighting in ZMC (US$2.6 million). This subcomponent

will enable the ZMC to install street lights along selected major road corridors and junctions outside of the Stone Town area. The STDCA and ZMC will also be provided with the capacity to identify and install street lighting fixtures on a section of one pedestrian street and one small public square within the Stone Town. Based on citizen feedback and acceptability of the fixtures within the context of the World Heritage City, the project may also scale up street light provision along additional streets and public squares within the Stone Town. The detailed designs are being updated to include solar power as an alternative technology. It was agreed that the works for the installation of the street lights will be packaged under one contract with supervisory support provided. These have been reflected in the procurement plan.

(v) Solid Waste Collection and Transportation within ZMC (US$2.8 million). This subcomponent will enable ZMC to substantially improve collection and transportation of solid waste through: a) rehabilitation and construction of concrete slabs with the placement of new skips; b) procurement of new collection and transportation equipment; c) increase in the number of door-to-door as well as bulk collection points; d) implementation of an operations and maintenance strategy for equipment; and e) better enforcement of regulations and by-laws related to municipal solid waste. ZMC currently operates a disposal site which will not receive any resources from the project but which has the capacity to receive additional waste for at least the next five years. Locations for placement of the concrete slabs have been identified, their designs are complete and procurement documents for equipment and transportation are ready for implementation. The solid waste component will be implemented under one works contract for the slabs and two goods contracts for the collection and transportation equipment for which draft bidding documents have been prepared.

(vi) Construction of the Mizingani Sea Wall and Associated Promenade within the Stone

Town (US$8.5 million). This subcomponent will enable the conservation of a public seafront and the historic buildings along Mizingani Road while preserving and enhancing the traditional seafront setting and its historic and architectural context within the Stone Town which has been declared as a World Heritage City by UNESCO. The design and development principles of this subcomponent are consistent with and are based on the “Stone Town Conservation Plan”, the provisions of which were formally approved by the Zanzibar Government in 1994 while respecting the requirements of maintaining the World Heritage City status for the Stone Town. Specifically, the subcomponent will enable: a) construction of approximately 340 meters of a seawall, extended out of its existing boundaries, including appropriate backfill and foundation work; b) refurbishment

6

of underground infrastructure including water, sewer, storm sewer and electrical and telecommunication lines located below the roadbed of Mizingani Road; c) resurfacing of the road and introduction of traffic calming measures; and d) creation of a pedestrian promenade, including landscaping, street lighting and street furniture along the sea side. For both structural and aesthetic reasons, all planned construction and landscaping activities as part of the Mizingani seafront subcomponent will be consistent and continuous with the work completed by other development partners7

. Detailed engineering designs have been completed through support by AKTC. The possibility of implementing this subcomponent utilizing the unique experience of AKTC in restoration of and conservation of the historic seafront, through its direct contractual involvement was discussed and it was agreed that, if found acceptable, a proposal to this effect will be submitted by the government for IDA’s review and consideration. It is anticipated that upon approval this subcomponent will be implemented through a consulting services contract with a “pass through works” component.

17. Component 2: Support to Town Councils on Pemba Island (US$3.8 million). This component will assist the three Town Councils of Chake Chake, Mkoani and Wete on Pemba Island with:

(i) Institutional Strengthening of Pemba Town Councils (US$1.4 million). This subcomponent will assist the three Town Councils through: a) technical assistance and hands-on coaching for council staff in the areas of planning and budgeting; b) procurement of office furniture and equipments; and c) procurement of vehicles and motorbikes. The project will also extend limited capacity development support to the President’s Office – Revolutionary Council and Local Governments (PO-RCLG)8

office on Pemba for procurement of office furniture, equipments and a vehicle.

(ii) Small-scale investment projects (US$2.4 million). The Town Councils (TCs) will be assisted in prioritizing simple manageable works or procuring equipment that can be easily operated and maintained. Selection of such simple works/equipment will be guided by: (a) capability of being fully implemented within a maximum of three years; (b) demand driven, reflecting the priorities of residents; (c) ability to have measurable impact based on agreed indicators; and (d) social, environmental and financial sustainability (i.e. in terms of operation and maintenance requirements). Civil works will not exceed US$ 1.1 million in Chake Chake TC, US$ 0.5 million in Mkoani TC and US$ 0.8 million in Wete TC. These investments will have minor environmental impacts and will be guided by environmental management plans which will comply with local and national laws and are acceptable to the Bank.

18. Component 3: Project Management (US$3.0 million). This component will provide support to the Project Management Team (PMT) located within the President’s Office – Finance, Economy and Development Planning9

7 Forodhani Park was restored with assistance from the Aga Khan Trust for Culture (AKTC).

(PO-FEDP) for project management, supervision of environmental and social safeguards, project monitoring and reporting. It will also facilitate other

8 Previously known as Ministry of State, Regional Administration and Local Government (MoSRALG) 9 Previously known as the Ministry of Finance, and Economic Affairs (MoFEA)

7

implementing ministries and departments responsible for specific sub components to implement and coordinate their respective components. B. Project Financing

1. Lending Instrument 19. ZUSP will be the first World Bank supported urban sector project on Zanzibar. Given the shortage of experience in the management of projects in general and urban projects in particular, as well as the evolving nature of government entities on the island, a simple and well structured Specific Investment Loan (SIL) was considered to be the most relevant instrument. It is anticipated that ZUSP will provide participating agencies with the opportunity to develop skills and experience in project preparation and implementation strategies.

20. An Adaptable Program Loan was not considered because: (a) Zanzibar does not yet have an established policy and comprehensive approach towards the urban sector; and (b) all government structures are currently being reviewed under the Public Sector Reform Program and are likely to be restructured during the project period.

2. Project Cost and Financing Table 1: Project Costs by Component

Project Cost by Component and/or Activities Total (US$ million)

1. Institutional Strengthening and Infrastructure Development in the Zanzibar Municipal Council (ZMC) Area

27.5

2. Support to Town Councils on Pemba Island 3.1 3. Project Management 2.8

Total Baseline Costs 33.4 Physical Contingencies 2.5 Price Contingencies 2.1 Total Project Costs 38.0 Note: Net of taxes and duties Table 2: Project Costs by Component and Source of Financing

Project Cost By Component and/or Activity IDA US$ million

Total US$ million

1. Institutional Strengthening and Infrastructure Development in Zanzibar Municipal Council Area

2. Support to Town Councils in Pemba 3. Project Management

31.2

3.8 3.0

31.2

3.8 3.0

Total Financing Required 38.0 38.0

8

C. Lessons Learned and Reflected in the Project Design 21. Successful urban development projects across Sub-Saharan Africa have the following characteristics: (a) simple design and well defined objectives; (b) clear implementation arrangements; (c) focus on building local institutional capacity for sustained and effective management of assets created; and (d) build on previous and on-going initiatives implemented either directly by the government or through the assistance from other development partners. These lessons are particularly important for projects being implemented in Zanzibar because of the shortage of experience in the management of World Bank supported projects.

22. Simple design and well defined objectives. ZUSP is defined very simply by including investments in basic municipal infrastructure which are implementable during the project period and for which all engineering designs have been completed during project preparation. Institutional strengthening activities are similarly simple and include basic elements which are required by any functional urban local government irrespective of size.

23. Clear institutional arrangements for project implementation. Given the evolving nature of Ministries and Departments responsible for urban and infrastructure management, project coordination will be housed within the PO-FEDP with technical responsibilities for implementation supervision assigned to the relevant Ministry, Department, Council and Authority.

24. Focus on building capacity of local institutions. ZUSP will build institutional capacity of the four participating urban local governments with an emphasis on service delivery as well as operations and maintenance. Special attention will be paid to revenue enhancement and financial management together with appropriate human resource deployment such that all project financed as well as future investments in infrastructure, plant and machinery are sustainably deployed, operated and maintained.

25. Continuity and building on previously successful initiatives. ZUSP will: (a) pick up and complete the highly successful KfW financed surface water drainage and solid waste management work done within ZMC; (b) work with and through the AKTC to take advantage of that organization’s world-wide and Zanzibar specific experience in the conservation and development of physical cultural and historic resources; and (c) coordinate with the government’s World Bank-supported Public Service Reform Program to better inform the development of appropriate urban local governments in Zanzibar.

IV. Implementation A. Institutional and Implementation Arrangements 26. RGoZ's President’s Office – Finance, Economy and Development Planning (PO-FEDP)10

10 RGoZ changed names of the three participating Ministries just before negotiations which were held on December 16, 2010.

will be responsible for the overall management of the project. Actual implementation of the project will be coordinated by a PMT established by PO-FEDP and staffed by officials drawn from RGoZ. ZMC, the STDCA, DoSUP, PO-RCLG and the three Town Councils on Pemba

9

will be recipients of the infrastructure investments and institutional strengthening inputs from the project. Additionally, they will participate by providing technical inputs and in supervision of subcomponents related to their jurisdictions.

27. Project Management Team: The Principal Secretary (PS), PO-FEDP, will be the Accounting Officer for the project, assuming overall responsibility for accounting for project funds. PO-FEDP established the PMT in October 2008 consisting of: a Project Coordinator, a Project Financial Management Officer, a Project Procurement Officer, a Project Accountant, an Environment and Social Safeguards Officer, and an Office Management Secretary. The same team will continue to be responsible for the project’s implementation. PO-FEDP through its PMT will be the only implementing agency for the project with overall responsibility for all procurement, financial management and reporting, monitoring and evaluation, coordination of all project activities and the provision of administrative and financial management functions (detailed implementing arrangements are provided in Annex 3).

28. Project Implementation Manual (PIM): A PIM will be finalized before effectiveness with detailed descriptions of institutional arrangements, the Abbreviated Resettlement Action Plan (ARAP) implementation schedule, financial and accounting procedures, procurement, monitoring, evaluation, and other administrative and organizational arrangements for the implementation of the project. Adoption of a PIM is a condition for project effectiveness.

B. Results Monitoring and Evaluation 29. Annex 1 provides the results framework including outcome indicators and intermediate outcome indicators for each project component. The PMT has overall responsibility for project implementation and the overall monitoring and evaluation system, in coordination with ZMC, STCDA, DoSUP and PO-RCLG. The PMT is responsible for compiling data and executing surveys and regular evaluations as necessary to monitor progress on project outcome indicators, with semi-annual reporting on these indicators. Reporting formats will be indicated in the operational manual and will include relevant environmental and social monitoring. A mid-term review will be conducted within 30 months of the effectiveness date of the project to evaluate implementation progress, assess effectiveness of implementing arrangements, and determine whether the project should refocus activities. C. Sustainability 34. Sustainability of the investments made under the project will depend on the strength of institutional structures responsible for their operations and maintenance. Moreover, the responsible institutions will require sustained adequate resources to function and deliver services.

35. Activities under the project have been designed to ensure sustainability of investments through an emphasis on: a) improved institutional and financial management capacity of ZMC and the three Town Councils on Pemba; b) emphasis on the mobilization of local revenues and improved cost recovery of key urban services; c) encouraging the participation of the private sector in the delivery and management of select services; d) enabling ZMC and the three Town Councils to increase allocation of funds for operations and maintenance; and e) ensuring that all procedures for operations and maintenance developed for the Forodhani Park in the Stone Town

10

are extended to the operation of the sea wall, public promenade and associated structures along the Mizingani Road.

V. Key Risks and Mitigation Measures 36. The overall risk rating of the project is Medium-I11

37. Local governments in Zanzibar may be recast under the Public Sector Reform Program: Given its size and importance, ZMC (which was established under its own legislation) is unlikely to be dissolved. It is most likely that ZMC’s jurisdiction will be enlarged. In that case, institutional strengthening activities under the project will enable ZMC to perform enhanced service delivery functions. The project will make very modest investments in the three Town Councils on Pemba and which will be useful and required under any future institutional structure.

. The following are likely risks that may be faced during implementation and the mitigation measures:

38. Technical designs are not acceptable to residents of Zanzibar: All ZUSP investments in infrastructure have followed technical designs and specifications developed on similar investments on Zanzibar and which have been accepted and found to be satisfactory. For drainage and solid waste – ZUSP will follow and update designs and specifications as implemented under the KfW-supported Phase I and Phase II of drainage works and solid waste management. For the sea wall – technical design and construction specifications will continue using those used in the construction of similar structures in the adjacent Forodhani Park. Extensive consultations have confirmed the acceptance by residents.

39. Sea wall subcomponent jeopardizes the World Heritage City status of the Stone Town: The STCDA have held multiple consultations with UNESCO to keep the agency fully informed of design and technical criteria. The sea wall designs have been presented to and received support from the International Council on Monuments and Sites (ICOMoS). UNESCO’s World Heritage Committee (WHC) which is responsible for listing and recognizing such sites has provided a no objection letter for the sea wall design12

40. Institutional strengthening activities for Zanzibar Municipal Council and the three Town Councils on Pemba are rejected by the councils: All activities included in the respective subcomponents have been identified and incorporated through a consultative process involving the institutional and individual stakeholders. PO-RCLG which is the current parent Ministry has led the process of activity identification for the three Town Councils on Pemba.

. The project will continue to involve the WHC through annual consultations so as not to jeopardize the status of the Stone Town.

41. Weak implementation capacity of implementing agencies: Overall project implementation will be the responsibility of PO-FEDP, which has the strongest capacity for implementation in Zanzibar and is best suited to coordinate activities of all RGoZ Ministries and Departments. The PMT has and will continue to receive training in financial management, procurement, safeguards 11 Medium driven by Impact (Medium-I): High Impact if the risks took place but a low likelihood of them occurring. 12 Letter from Mr. Francesco Bandarin, Director a.i., WHC to Mr. Issa Makarani, DG, STCDA dated September 01, 2010.

11

management, monitoring and implementation. Moreover, the PMT has gained some project implementation experience through the effective management of the PPA.

42. Poor performance of contractors and/or weak supervision may delay the implementation of subcomponents: Construction supervision consultancies will be procured to assist the subcomponent implementing agencies. In the areas of major investments: surface water drainage and construction of the sea wall, considerable experience has been built (in ZMC for drainage where KfW has been active for over a decade and in the STCDA where the AKTC has provided assistance in the development of Forodhani Park).

VI. Appraisal Summary A. Economic Analysis 43. The economic analysis of the ZUSP project shows that improving and developing services in ZMC and the three Town Councils on Pemba Island is an economically viable investment. Public infrastructure in this heritage city is in a dilapidated condition. Large areas of the larger ZMC are very dense, unplanned and informally developed and poorly accessed locations. The sea wall which is an important part of the UNESCO declared World Heritage City of the Stone Town is on the verge of being lost. The project benefits include: (i) a reduction in the number of houses directly affected by flooding from rain water in the catchment of surface water drains constructed; (ii) establishment of modern street lighting; (iii) increase in the number of households accessing regular solid waste collection; (iv) maintenance of the cultural heritage and World Heritage City status of the Stone Town; and (v) strengthening the institutional capacity of ZMC and the three town councils of Pemba. Improvements of the Stone wall area will boost the tourism potential of the islands.

44. Cost benefit analysis of the Mizingani Sea Wall yields a net present value (NPV) of US$ 15.03 million at a discount rate of 12 percent with an internal rate of return (IRR) of 47 percent. Investments in storm water drainage systems, are estimated to generate a net present value of about US$ 20.64 million but with a low internal rate of return of 7 percent. Provision of street lighting is likely to yield a net present value of US$ 1.3 million and an IRR of 28 percent. Investing US$ 2.436 million in solid waste garbage disposal will help improve the potential service charges collected by the municipality.

45. However, potential benefits such as those in public health due to reduced flooding and solid waste disposal are not quantified. The other benefits which are not quantified include those generated by the strengthening of the ZMC and the three Town Councils on Pemba. A detailed economic analysis of the project has been conducted based on assumptions and description included in Annex 7. B. Technical 46. Identification of subprojects: Since ZUSP will be the Bank’s first engagement in the urban sector in Zanzibar, the project places emphasis on “learning-by-doing” through the management of investments in simple infrastructure and institutional strengthening. Moreover, infrastructure investments in drainage, sea wall construction and solid waste collection were

12

identified because in each of these areas the RGoZ has gained experience through assistance from the KfW (in drainage and solid waste management) and the AKTC (in cultural heritage). 47. Preparation and technical designs: RGoZ requested and received a Project Preparation Advance (PPA) in two tranches totaling US$1.4 million, which allowed the preparation of background studies (institutional strengthening of ZMC and the three Town Councils on Pemba and urban planning issues), technical designs for proposed infrastructure investments (surface water drainage system, solid waste collection and transportation and street lighting) and the ESIA13

48. Implementation arrangements for infrastructure subprojects: Subcomponent coordinators based in the ZMC, STCDA and the three TCs on Pemba will continue to participate in providing technical supervision during implementation. The PMT will remain the sole implementing agency with responsibilities for all procurement and financial management issues. Subcomponent coordinators will continue to participate in monitoring project activities and will prepare activity progress information and share it with the PMT Coordinator who will collate and report on project progress.

. Management of the PPA provided the PMT and the teams responsible for respective subcomponents with experience in the areas of procurement, financial management, safeguards, and the management of consultants. AKTC continued to provide assistance to the STCDA in the area of cultural heritage conservation and enhancement while the KfW provided technical assistance to ZMC in institutional strengthening, drainage and solid waste management with additional support for technical experts from GTZ/CIM. The PPA costs are included in Component 1 (US$0.8 million) and Component 3 (US$0.6 million).

C. Financial Management 48. An initial financial management assessment was carried out in November 2008 and reviewed in March 2010. Both assessments were conducted in accordance with the World Bank Financial Management Practices Manual issued by the Financial Management Sector Board. The objective of the assessments was to ensure that the PMT within PO-FEDP as implementing agency has adequate financial management arrangements to ensure that: (a) project funds will be used for the purposes intended in an efficient and economic way; (b) project financial reports will be prepared in an accurate, reliable and timely manner; and (c) external audit report will be prepared in line with international accepted audit standards and issued on time as it has been for the PPA. At the time of the initial assessment, the financial management staff of the PMT did not have experience in managing World Bank project funds. However, the second assessment in March 2010 found that during project preparation, the PMT’s FM team was able to gain valuable experience in managing the PPA. The PMT has an experienced FM coordinator and an assistant. They have both received adequate training in FM and software use. Both FM officials have effectively managed two tranches of the PPA and the PMT has been preparing Interim Financial Reports (IFRs) acceptable to the Bank. Project accounts for FY 2009 have been audited and received an unqualified opinion.

49. The financial management assessment concluded that the project’s financial management arrangement satisfies the Bank’s minimum requirement under OP/BP 10.02 and the existing

13 The Environment and Social Impact Assessment for the sea wall subcomponent was financed by the AKTC.

13

system is adequate to provide, with reasonable assurance, accurate and timely information on the status of the project as required by the World Bank. Details of the financial management assessment are included in Annex 3. The conclusion of the assessment is that the financial management arrangements have an overall residual risk rating of Medium-I (high impact if it were to occur but low likelihood of it occurring). D. Procurement 50. Procurement for the proposed project will be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits," dated May 2004, revised October 2006 and May 2010, and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers," dated May 2004, revised October 2006 and May 2010, Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants, dated October 15, 2006 and the provisions stipulated in the Financing Agreement. 51. The PMT has a senior Procurement Officer and an Assistant, both of whom have attended procurement training. The PMT’s procurement officials are backed up by the PO-FEDPs procurement staff who have the necessary experience and authority on procurement issues. Using the PPA, the PMT has successfully procured multiple consultancy services and goods. A procurement capacity assessment was carried out in August, 2010. The assessment concluded that the PO-FEDP and the PMT has sufficient staff to carry out procurement functions though the current staff members are not fully familiar with Bank’s procurement procedures. As a result, the procurement risk is assessed as Medium–I.

52. Risk mitigation measures have been discussed and agreed with the PMT. The measures include training of staff of the PMT and other participating agencies in basic and advanced procurement in works, goods and selection of consultants. A brief summary of the procurement capacity assessment and project arrangements are provided in Annex 3. More details are available in the project files. In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment of the implementing agency has recommended two annual supervision missions to conduct post review of procurement actions. The draft procurement plan (PP) for the first 18 months has been prepared. It will be updated at least annually or as required to reflect project implementation needs.

E. Social and Environment 53. The project is a category ‘A’ project and triggers OP 4.01 as it potentially may have considerable environmental impacts, OP 4.11 as it is a UNESCO World Heritage Site and OP 4.12 for potential temporary dislocation, loss of assets, homes and access to services. Two separate ESIAs14

14 See Annex 8 for full descriptions. These ESIAs have been disclosed (in country on Aug. 4 & 13, 2010 and InfoShop on Sept.

13, 2010), consulted upon, and cleared by the Bank. Executive Summaries have been sent to the Executive Directors, per the requirements of OP/BP 4.01.

were commissioned to assess and mitigate the social and environmental impacts because ZUSP will fund two major physical investments: (a) provision of storm water drainage, collection and transportation of solid waste and street lighting within ZMC; and (b) construction of the Mizingani Sea Wall and associated promenade within the Stone Town. In line

14

with World Bank requirements, both ESIAs were prepared by consultants who are independent from those responsible for the technical and engineering designs of the investments. 54. As part of the ESIA preparation process for the sea wall, consultations with key stakeholders formed an integral component of scoping, investigation / assessment and final recommendation process stages, enabling the stakeholder to comment on the potential environmental and social impacts associated with the feasible alternatives and to identify additional issues which they felt may not have been adequately addressed in the scoping phase. The national institutional stakeholders consulted include: STCDA, ZMC as managers of the site as well as the Institute of Public Administration, the Zanzibar Conservation Centre (Old Customs House), the Public Services Department and the Palace Museum. Private stakeholders include the boat (mashuwa) operators, periodic informal vendors, swimmers as well as the owners of private buildings along Mizingani Road. Being a World Heritage City, international stakeholders include UNESCO’s World Heritage Centre. The most critical negative impacts, as identified by the stakeholders will be during construction due to the limitations of access or “nuisance” impacts resulting in loss of wage and/or profits. In addition, the sea wall construction process will require management of traffic and continued access to the beach (which has seasonal variations) by the tourist boat operators, tourists and swimmers. Social benefits range from improved civic pride to improved traffic circulation and pedestrian safety whereas economic benefits include business opportunities for entrepreneurs and job creation. The ESMP provides a comprehensive list of mitigation measures. Implementation and management of the ESMP will be supervised by the PMT, STCDA and the ZMC. The construction of Forodhani Park which was completed in late 2009 has provided STCDA with adequate experience in managing similar situations in the same physical context. While PMT has limited capacity in managing social impacts, the project will provide support in this area as required. 55. The ESIA conducted a detailed analysis of the physical cultural heritage issues to ensure compatibility with the existing physical environment. The ESMP provides detailed conservation standards and processes which were examined and cleared by UNESCO to ensure compatibility with World Heritage Council requirements. Maintaining such compatibility and thereby safeguarding the World Heritage City status of the Stone Town is a central focus of ZUSP. 56. As part of the ESIA preparation process for surface water drainage, solid waste management and street lighting subcomponents, consultations were held with institutional stakeholders including ZMC, STCDA and the Zanzibar Electricity Board. Private stakeholders include all residents of ZMC in general but particularly residents who live adjacent to the streets in question. The concerns identified by the stakeholders will be partial damage to the houses and other assets, such as home gardens and fruit trees, temporary loss of access, health and safety issues. A comprehensive list of potential adverse impacts is documented in the ESIA and the mitigation measures in response to the adverse impact are reflected in the ESMP and the ARAP. 57. Multiple rounds of stakeholder consultations were held with the entire range of stakeholders including members of civil society. All consultation meetings and discussions are documented in the two ESIA documents which are disclosed in the country and through the InfoShop. Additionally, both ESIA initiatives prepared wall posters which were placed at strategic locations in and around the proposed construction sites. Once design considerations

15

were finalized, a third round of consultations was held to fully inform likely affected persons of the design decisions. The project affected persons were informed of the exact adverse impacts and the mitigation measures were discussed and agreed to with the PAPs. 58. Since the drainage works will pass through residential areas, there will be some loss of property and assets during the construction phase. As determined by the ESIA and the socio-economic survey, there will be no displacement or resettlement of residents due to the project. Nonetheless, land acquisition for civil works is expected. The project affected people have been identified and an ARAP has been developed (see Annex 8) to compensate those who are expected to lose portion of their property to accommodate civil works. The costs of which will be borne by the RGoZ. 59. In the case of the surface water drainage systems and solid waste collection systems, reduction in stagnant water as a result of the new and rehabilitated drainage systems and the restriction of solid waste disposal to formalized and managed sites will be the most significant and positive impact of the proposed project. It is anticipated that this will reduce the incidence of diseases related to polluted and stagnant water and dispersed waste. It will also provide improved access to and use of areas (such as the sporting grounds) which are presently completely, partially or regularly flooded.

60. Provision of street lighting will make the area more accessible for residents as well as tourists and improve the general visibility and safety in the area at night. Upgrading street lighting in the Stone Town will allow residents and tourists to appreciate the amenity value of the Stone Town and improve opportunities to serve the needs of visitors, residents and traders.

61. The civil works on Pemba Island financed by the project will be small (see paragraph 17 (ii) above) and will have minor environmental impacts. Once identified, these investments will be guided by environmental management plans that comply with local and national laws and which are acceptable to the Bank. The Bank has provided guidance (Annex 8) to the local government(s) on the preparation of the environmental management plans.

62. A review of the institutional capacities of the implementing institutions revealed that there is adequate regulation for environmental management at central government level, including the Zanzibar Environmental Policy of 1992; Zanzibar Environmental Management for Sustainable Development Act, 1996; Environmental Impact Assessment Regulations of Zanzibar, and the 2002; Stone Town Act No. 3 of 1994. The policy and legislations place emphasis on the importance of improving institutional and personal capacity in the conservation and management of the environment. Notwithstanding the presence of the legal documents, overall institutional and technical capacity for environmental management needs to be strengthened at the project implementation levels. This need has been addressed in detail in the ESMPs and budgets have been provided for under the project to implement the recommended capacity improvement measures.

16

Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.01) [X] [ ] Natural Habitats (OP/BP 4.04) [ ] [X] Pest Management (OP 4.09) [ ] [X] Physical Cultural Resources (OP/BP 4.11) [X] [ ] Involuntary Resettlement (OP/BP 4.12) [X] [ ] Indigenous Peoples (OP/BP 4.10) [ ] [X] Forests (OP/BP 4.36) [ ] [X] Safety of Dams (OP/BP 4.37) [ ] [X] Projects in Disputed Areas (OP/BP 7.60) [ ] [X] Projects on International Waterways (OP/BP 7.50) [ ] [X]

http://www.worldbank.org/environmentalassessment�

http://intranet.worldbank.org/WBSITE/INTRANET/OPSMANUAL/0,,contentMDK:20064724~pagePK:60001255~piPK:60000911~theSitePK:210385,00.html�


















17

Annex 1: Results Framework and Monitoring

United Republic of Tanzania: Zanzibar Urban Services Project PROJECT DEVELOPMENT OBJECTIVE: Improve access to urban services in Zanzibar and conserve the physical cultural heritage at one public location within the Stone Town

PDO Level Results Indicators C

ore Unit of

Measure Baseline

2010

Cumulative Target Values Frequency Data Source/

Methodology

Responsibility for Data

Collection

Description (indicator

definition etc.) 2011 2012 2013 2014 2015 2016

Indicator One: Households reporting flooding inside homes in ZMC project area (number)

Number 3,645 3,645 3645 3025 2843 1130 0 Annual Regular Drainage construction reports

ZMC / Division of Sewerage, Drainage and Solid waste (DSDSW)

Surface water drainage works will be implemented in phases across six drainage systems

Indicator Two: People in urban areas (ZMC) provided with access to regular solid waste collection under the project (number)

Persons 27,000 (5,000 HHS)

27,000 (5,000 HHS)

27,000 (5,000 HHS)

75,600 (14,000 HHS)

113,400 (21,000 HHS)

113,400 (21,000 HHS)

113,400 (21,000 HHS)

Annual Regular progress reports

ZMC Department of Solid Waste and Drainage

Does not refer to door-to-door collection but to access to bulk collection points across the jurisdiction

Indicator Three: The Stone Town retains status of World Heritage City

Y/N Y Y Y Y Y Y Y

At project start, mid-term and on completion

World Heritage City List / UNESCO

STCDA

Construction of the sea wall should not jeopardize the status of Stone Town as a WHC

Indicator Four: Direct project beneficiaries (number), of which females (%) (CORE)

Persons 0 306,000 (females

52%)

310,000 (females

52%)

316,000 (females

52%)

320,000 (females

52%)

325,000 (females

52%)

330,000 (females:

52%) Annual

Census and annual estimates

PMT Core indicator for IDA

18

INTERMEDIATE RESULTS

Intermediate Result: Component 1 – Zanzibar Municipal Council strengthened and infrastructure in place

IRI One: ZMC’s Change Management Strategic Plan developed and under implementation

Y/N N N N Y Y Y Y Annual M&E Reports ZMC

All elements of the plan will be implemented in ZMC

IRI Two: Diagrammatic Indicative Structure Plan completed

Y/N N N N N Y Y Y Annual M&E Reports DoSUP The Structure Plan will be used by RGOZ/ZMC

IRI Three: Construction of surface drains completed in ZMC outside of the Stone Town

Meters 0 0 0 3,339 4,397 13,526 19,631 Annual Regular Drainage construction reports


Surface water drainage works will be implemented in phases across six drainage systems

IRI Four: Streets with new lighting installed along selected roads and junctions (kms)

Kilometers 0 0 3 11 11 11 11 Annual Construction reports

ZMC Engineering Dept.

Only selected streets in the Stone Town

IRI Five: Solid waste collection points provided and functional

Number 0 0 0 78 115 193 193 Annual Regular construction reports


Collection points with necessary construction and hardware in place

IRI Six: Length of Mizingani sea wall and promenade constructed

Meters 0 0 0 0 0 150 340 Annual Construction reports

STCDA

Construction of the sea wall will be in stages i.e. footing, foundation and wall face

Intermediate Result: Component 2 – Town Councils in Chake Chake, Mkoani, and Wete in Pemba Island strengthened, simple investments identified and operational

IRI One: Retooling of 3 Town Councils completed

Y/N N

N Y Y Y Y Y Annual M & E Reports PO-RCLG Retooling requirements and identified with the help of TA during the first year of the project and 3 TCs making effective use of retooled offices

IRI Two: Small investments identified and implemented by the three town councils in Pemba

Y/N N N Y Y Y Y Y Annual M & E Reports PO-RCLG

19

Annex 2: Detailed Project Description 1. The project will be implemented within the four local governments of Zanzibar which have an “urban” status, namely: ZMC on Unguja Island and the Town Councils of Chake Chake, Mkoani and Wete on Pemba Island. However, due to the current system of local government in Zanzibar which has inconsistent institutional arrangements and duplication or unclear assignment of responsibilities, some subcomponents will be overseen by government entities other than the urban local governments.

2. ZUSP will have three components. Component 1will strengthen institutional capacity of the ZMC and develop infrastructure such as surface water drainage systems, solid waste collection and transportation, street lights and a sea wall within the World Heritage City location of the Stone Town all within the ZMC area. Component 2 will support the Town Councils of Chake Chake, Mkoani and Wete on Pemba Island by strengthening their institutional capacity and through the identification and implementation of simple and small investments. Component 3 will support project management.

Component 1: Institutional Strengthening and Infrastructure Development in the Zanzibar Municipal Council Area (US$31.2 million)

3. Component 1 will focus on the ZMC on Unguja Island and will comprise six subcomponents each of which will be overseen by a subcomponent coordinator based in the respective implementing entity.

4. Institutional Strengthening of the Zanzibar Municipal Council (US$4.3 million): A detailed Institutional Strengthening Assessment of the ZMC was conducted and which consisted of an Institutional Review and Analysis (IRA) and the preparation of an Institutional Strengthening Plan (ISP). The IRAs focused on the identification of capacity constraints, while the ISP formulated an institutional strengthening strategy and action plan.

5. The IRA identified the following challenges: i) weak and inadequate internal management systems resulting in ineffective and inefficient realization of intended goals and objectives; ii) an inappropriate and non-standard financial management system; iii) non-conforming and inadequately executed procurement and audit functions; iv) planning is limited to budget preparation and follows a non-participatory process that does not take into account departmental performance expectations and human resource capacity; v) absence of accounting manuals to support financial management practices; vi) inadequate or weak revenue enhancement strategies; and vii) absence of a comprehensive staff performance appraisal system.

6. The project will support the strengthening of the management and operational capacity of the ZMC through: a) technical assistance for the preparation and implementation of a change management strategy, including review and update of by-laws, improvement of human resource management, enhancing planning and management of infrastructure and services, as well as development of an ICT strategy; b) technical assistance for improving financial management, procurement and revenue collection, including dialogue with the PO-FEDP and the Zanzibar Revenue Board (ZRB) to have clear assignment of revenue sources, building institutional capacity to collect those revenues and demonstrating effective financial management by

20

implementing a one customer-one bill strategy; c) technical assistance for improving ZMC’s interface with citizens, including carrying out a “demands for service delivery” survey, design and roll out of a communications strategy and establish a call center through which citizens can interface with ZMC; d) technical assistance for preparing the renovation projects for the ZMC Office and Workshop; e) procurement of works for repair and rehabilitation of the ZMC Office and Workshop buildings; f) procurement of goods for re-tooling ZMC (e.g. cesspit emptier, aerial lift for street light O&M, small tipping trucks, small vacuum tankers, etc.) and equipping ZMC office (computers, furniture etc.); and, g) training of ZMC on core municipal management competences, including, but not limited to financial management, procurement, project management and asset management.

7. Preparation of a Diagrammatic Indicative Structure Plan15 for ZMC and its immediate periphery (US$2.2 million): A background study on urban planning issues in Zanzibar was conducted during project preparation which identified the following challenges: a) lack of a current urban development plan as well as policy or guidelines which can together guide planners and development control agencies; b) confusing and overlapping responsibilities for planning and development control among the main actors which include the Ministry of Lands, Housing, Water and Energy (MLHWE) and its Department of Survey and Urban Planning, the Stone Town Conservation and Development Authority (STCDA), the ZMC, the West District Council, the shehas16 and councilors; c) absence of formalized information flows between public institutions responsible for physical development and its management and an absence of a functional physical development management system; and d) lack of public participation and therefore an absence of public awareness about the importance of effective physical planning required for one of the world’s most densely populated cities17

8. This subcomponent will support MLHWE’s Department of Survey and Urban Planning (DoSUP) through: a) technical assistance for the preparation of a diagrammatic indicative structure plan for the ZMC and its immediate periphery to inform future growth decisions, including the establishment of effective information flows and coordination with the Department of Lands Registration (DoLR), ZMC and other related agencies; as well as the establishment of an effective physical development monitoring and management system; b), technical assistance for the preparation and roll-out of community communication campaign; c) procurement of urban planning related technical and office equipment; and d) training of DoSUP staff on core urban planning competences.

.

9. Construction of storm water drainage systems in the areas outside of the Stone Town (US$10.8 million): The ZMC area can be functionally divided in two parts – the historic World Heritage City of Stone Town and the “new town” or Ng’ambo area. The mean coastal elevation is about 6.6 meters above sea level with annual rainfall between 1,500 to 2,000 mm. Short duration high intensity rains produce considerable runoff during two rainy seasons (March to May with about 60 percent and October to December with about 40 percent of the annual

15 A Diagrammatic Indicative Structure Plan (DISP) is not a statutory physical development plan. No plot level decisions are to

be included. As the name suggests, the DISP will be developed such that it can provide long term directions to decision makers working in different sectors such as roads, water supply, sewerage etc.

16 Neighborhood level officials 17 Ten census wards of the ZMC have population densities between 25,000 to 80,000 persons per square kilometer. The densest

census tract within New York City has 42,000 persons per square kilometer.

21

rainfall). Large sections of the Ng’ambo area have been settled and developed through an unplanned and informal process. In the absence of surface water drains, flooding is regular and destructive. Even after two phases of KfW-supported implementation of surface water drainage systems18

10. This subcomponent will enable the construction of 19.631 kilometers of surface drains and related works within and in the Ng’ambo areas outside of the Stone Town. Six separate surface water drainage systems will be constructed with a total catchment area of around 1,698 hectares eliminating 173 hectares of persistent stagnant water ponds which affect more than 20,000 persons living in around 3,645 houses. Details on the six surface water drainage systems are as follows:

, stagnant water ponds covering more than 173 hectares are common and directly affect around 3,645 houses which have to be periodically abandoned or where residents (who are mainly extremely poor) have to spend considerable resources to build defensive structures around doors or annually re-strengthen the shallow foundations.

a. System C (Amani to Mianzini): this is an open drain parts of which were rehabilitated under Phase I and select sections were relined under Phase II. Under the project, select sections of the existing channel will be rehabilitated, a pipe network installed in Kwamabata, open channel will be extended to Sebleni and Jitini, existing culverts will be replaced and new access structures will be constructed. The total length of the system will be 9,147 meters.

b. System D (Muungano to Mwembenjugu and Sogea to Kidongo Chekundu): two sections of surface drains will be joined to an existing upgraded open drain which was laid under Phase II. Under ZUSP, 767 meters will be worked on.

c. System E (Jang’ombe and Migombani to Kilimani / Kiungani): Downstream works were completed under Phase II, under ZUSP upstream drainage will be expanded and extended to include a new rectangular channel with cover slabs along Jangombe Road, a rectangular tributary from Magomeni/Mpendae, rehabilitation of the existing dirt channel from Migombani including one section with pipes, replacement of existing culverts, construction of new access structures and construction of new rectangular channel south of Jang’ombe Road. The system under ZUSP will be 4,629 meters.

d. System F (Mnazi Mmoja Cricket Ground): The existing system will be expanded to drain the flooding caused by a combination of sea water backflow during high tides, high water table and runoff from surrounding higher ground during the rainy season. Under ZUSP a pipeline from the ground to the sea out fall will be constructed, manually operated gate values to prevent backflow installed, PVC perforated subsoil lateral pipes laid to drain the public grounds and open channels along Benjamin Mkapa and Nyerere Roads will be constructed. The total length of the system under ZUSP will be 810 meters.

18 Under the KfW-supported Zanzibar Sanitation and Drainage Programme: Phase I (1994 to 1998) an underground sewerage

collection and conveyance system as well as implementation of solid waste collection were implemented only within Stone Town. Under Phase II (2003 till date) extension of the sewerage and drainage system, improvement of solid waste collection and landfill sites and an accompanying institutional support were provided.

22

e. System G (Kwa Mzushi to Mtopepo/Darajabovu Road): This is a new system where an underground pipeline will be laid from Kwa Mzushi to Mtopepo with a branch pipeline from Karakana and a short trapezoidal channel to discharge runoff. The total length of the system will be 1,490 meters.

f. System I (Kwamtipura to Saateni Bridge): Parts of this system were rehabilitated with stone pitching under Phase I and which will remain as is. Under ZUSP, rehabilitation of the remaining sections will be done together with the addition of two new tributaries (Kanyeni and Avenger) and the construction of new access structures. The total length of the system under ZUSP will be 2,789 meters.

11. A seventh system (System H: Mwanakwerekwe to Jeshini) with a total length of 8,559 meters was examined during preliminary design stages. While it was agreed that this system is necessary to complete the surface water drainage system within ZMC, it was not included in the ZUSP because of the considerable cost of construction which could not be accommodated under the current project.

12. Based on experience gained during implementation of earlier drainage improvement works in Zanzibar under KfW financing, ZMC proposed during the appraisal mission to have one works contract for the construction of the planned six drainage systems, with implementation supervision assistance provided. This has been agreed and reflected in the procurement plan.

13. Design and installation of street lighting in Zanzibar Municipal Council areas (US$ 2.6 million): This subcomponent will enable ZMC to install street lights along major road corridors and junctions outside of the Stone Town area. The Stone Town Development and Conservation Authority and ZMC will also be provided with capacity to identify and install street lighting fixtures on one section of a pedestrian street and small public square within the Stone Town. Based on citizen feedback and acceptability of the fixtures within the context of the World Heritage City, the project may also scale up street light provision along additional streets and public squares within the Stone Town.

14. In areas outside of the Stone Town, street lighting will be provided along the following roads: a) Kaunda; b) Nyerere; c) Amani-Magomeni; d) Mwembeladu-Amani; e) Migombani-New Roundabout; and f) Bububu. Within the Stone Town street lights will be provided as trials for citizen and WHC feedback in Shangani and Kiponda areas.

15. The street lighting component of the project will be implemented by including the utilization of solar powered street lighting to take advantage of the effectiveness of such technology with respect to its overall costs as well as regular operations and maintenance. This component will be implemented through one package of works contract assisted by effective supervision through a consultancy.

16. Solid waste collection and transportation within Zanzibar Municipal Council (US$2.8 million): The ZMC area is estimated to generate around 220 tons per day (600 cubic meters per day) of solid waste. With ZMC’s current equipment and collection system only 100 tons per day (270 cubic meters per day) are collected and transported to a disposal site at Jumbi. This leaves a shortfall of around 120 tons per day (330 cubic meters per day) that is not formally collected or

23

transported. The current system offers very limited door-to-door collection (mostly within the Stone Town) with most waste being hand transported to local collection points from where ZMC trucks and trailers transport the waste to the ZMC managed disposal site. There are a total of 75 formally designated collection points where either the waste is deposited on a concrete slab or in a metal skip. In addition, around 92 “informal” collection points have sprung up where waste is dumped by the resident communities on open ground and from where ZMC periodically lifts and transports the waste to the disposal site.

17. This subcomponent will enable ZMC’s Division of Sewerage, Drainage and Solid Waste to substantially improve collection and transportation of solid waste through: a) rehabilitation and extension of 48 existing concrete slabs, construction of 115 double slabs where two skips can be placed and 30 triple slabs at locations where heavy bulk solid waste is deposited; b) procurement of new collection equipment including push carts which can navigate the extremely narrow streets of the Stone Town, skip containers which will be placed on the concrete slabs to ensure that waste does not spread, skip trucks with skip loaders, open tipper trucks and compactor trucks for transporting waste; c) implementation of an operations and maintenance strategy for equipment and; and d) better enforcement of regulations and by-laws related to municipal solid waste. The disposal site which will not receive any resources from the project has capacity for at least the next five years. Locations for placement of the concrete slabs have been identified, their designs are complete and procurement documents for equipment and transportation are ready for implementation. The solid waste component will be implemented under one works contract for the slabs and two goods contracts for the collection and transportation equipment for which draft bidding documents have been prepared.

18. Completing the Mizingani Sea Wall in the Stone Town (US$8.5 Million): In 1994, RGoZ approved the “Stone Town Conservation Plan” in line with requirements for the historic city to be enshrined by UNESCO in the World Heritage List. Among other elements, the conservation plan identified the area known as Forodhani Park and the adjoining Mizingani sea wall area for rehabilitation. In 2009, with assistance from the Aga Khan Trust for Culture (AKTC), RGoZ completed rehabilitation of the Forodhani Park, which has proved to be a huge success and is now extensively used by residents and tourists. The park is once again the center of social and public life of the Stone Town. Rehabilitation involved reconstruction of a sea wall running the entire length of the park, replanting trees as well as hard and soft landscaping, street lighting and the implementation of a public space management plan including the training of local food stall vendors. Importantly, the park rehabilitation has set the engineering and conservation standards for public spaces and sea wall rehabilitation within the Stone Town.

19. This subcomponent of ZUSP will enable the completion of rehabilitation of the entire Forodhani-Mizingani iconic sea face of the Stone Town. Specifically, the subcomponent will enable: (a) construction of 340 running meters of a vertical seawall with a 5 meter wide reclamation extended out of its existing boundaries, including appropriate backfill, foundation work using design, engineering and construction standards in conformity with those used in the Forodhani Park; (b) refurbishment of underground infrastructure including water, domestic and storm sewer and electrical and telecommunication lines located below the Mizingani Roadbed; (c) resurfacing of the 6 meter wide road and introduction of traffic calming measures; and (d) creation of a 5.8 meter wide pedestrian promenade, including landscaping, street lighting and street furniture along the sea side.

24

20. The sea wall and its associated public promenade’s overall design and width have taken into consideration the risks posed to the heritage, as well as urban planning and technical aspects. If the wall position were to remain the same as today, the excavations during construction would be in close proximity to the historical building façades and therefore the risk of damage to these iconic historic properties would be highly probable. In order to avoid this risk and not undermine the existing wall during construction, a distance of at least 4 to 5m is required beyond the current alignment. The reclamation has been limited to a realistic area which allows for a buffer between construction activities and the buildings. A further benefit of the reclamation is that, in the additional space provided, it becomes possible to separate pedestrian activities from the road, as well as introduce a larger buffer between the building façades and the existing road, which is a source of vibrations. In relation to the proposed reclamation, the ESIA has indicated that the requirements imposed by the World Heritage Convention with respect to authenticity need to be seen in the light of the structural failure of the existing seawall and the threat that this poses to the historic buildings. Further to this, it is noted that the seafront has a history of being spatially and functionally adapted over time and that, as such, it is not a static heritage resource. Its sense of place has been largely determined by the human activities and the role that, as a thoroughfare, maritime wharf and recreation space, it continues to play in the larger context of the Stone Town. The conclusion drawn by the ESIA is that the upgrade of the seawall and Mizingani Road, which is in line with the approved Conservation Plan, is likely to have not only the effect of protecting the heritage resources, but also a catalytic impact on restoration efforts. The subcomponent will thus achieve protection for the heritage concerned within acceptable limits of change in a World Heritage Site.

21. For both structural and aesthetic reasons, all planned construction and landscaping activities as part of the Mizingani seafront subcomponent will be consistent and continuous with the work completed by other development partners (Forodhani Park was restored with assistance from the Aga Khan Trust for Culture (AKTC). Detailed engineering designs for the Mizingani wall have been completed through support by AKTC. The possibility of implementing this subcomponent utilizing the unique experience of AKTC in restoration and conservation of historic seafront, through its direct contractual involvement was discussed and it was agreed, and if found acceptable, that a proposal to this effect will be submitted by the government for Bank’s review and consideration. It is anticipated that upon approval this subcomponent will be implemented through a consulting services contract with a “pass through works”.

Component 2: Support to Town Councils on Pemba Island (US$3.8 million)

22. This component will assist the three Town Councils of Chake Chake, Mkoani and Wete on Pemba Island with institutional strengthening and the financing of small investments with support from the PO-RCLG. Allocation of project resources were made using a transparent and equitable formula, using reliable, verifiable data with population, given a weight of 40 percent and local revenue, a weight of 60 percent. The table below summarizes allocations for each of the three town councils and for the two subcomponents.

25

Town Council Population 19 Revenue Coefficient Total

Allocation (USD million)

Allocation for Institutional

Strengthening (USD)

Allocation for Small

Investments (USD)

Wete 24,983 2020 0.34 1.26 466,667 800,000 Chake Chake 19,283 4021 0.47 1.74 641,667 1,100,000 Mkoani 12,176 1222 0.19 0.80 291,667 500,000

Total 56,442 72 1.00 3.80 1,400,000 2,400,000 23. Institutional Strengthening of Pemba Town Councils (US$1.4 million): A detailed Institutional Strengthening Assessment of the three Town Councils was conducted and which consisted of an Institutional Review and Analysis (IRA) and the preparation of an Institutional Strengthening Plan (ISP). The IRA focused on the identification of the institutional capacity constraints, while the ISP formulated an institutional strengthening strategy and action plan for the three councils.

24. The IRA identified the following challenges: i) extremely weak internal management systems including a lack of standard rules and procedures for conducting council meetings and inviting or incorporating any participation from citizens; ii) absence of any accounting manuals or procedures which would allow for appropriate financial management; and iii) absence of any revenue enhancement practices.

25. This subcomponent will assist the three Town Councils through: a) technical assistance to support the development and implementation of rules, regulations and procedures which are appropriate to the small size of the councils. This will be done through hands-on coaching and “learning-by-doing” to assist the councils improve the effectiveness of council meetings, community consultations, planning and budgeting; and b) procurement of basic office and computer equipment, office furniture, and limited vehicles or motorbikes.

26. Small-scale investment projects (US$2.4 million): The Town Councils will be assisted in prioritizing simple manageable works or procuring equipment that can be easily maintained. Selection of such simple works/procuring equipment will be guided by: a) the capability of being fully implemented within a maximum of three years; b) demand driven, reflecting the priorities of residents; c) being able to have measurable impact based on agreed indicators; and d) socially, environmentally and financially sustainable (i.e. in terms of operation and maintenance requirements). Civil works will not exceed US$ 1.1 million in Chake Chake TC, US$ 0.5 million in Mkoani TC and US$ 0.8 million in Wete TC. These investments will have minor environmental impacts and will be guided by environmental management plans that comply with local and national laws and are acceptable to the Bank.

Component 3: Project Management (US$3.0 million)

27. This component will provide support to the PMT located within PO-FEDP for project management as well as in monitoring and reporting systems. It will also facilitate other 19 Source: 2002 population census. 20 Local revenue for Wete town council is based on average of TShs 2.5 million per month during peak period and TShs 800,000

per month during non-peak period. 21 Local revenue for Chake Chake TC is based on actual and projected collections for FY2009/10. 22 Local revenue figure for Mkoani TC is based on actual revenue collections of TShs 980,000 per month.

26

implementing Ministries and Departments responsible for specific sub components to implement and coordinate their respective components.

28. Specifically, the project will finance: i) regular project activity monitoring, reporting as well as on environmental and social safeguards; ii) monitoring of implementation of the Environmental and Social Management Plans and the Abbreviated Resettlement Action Plan; iii) environment and social audit; iv) office operating costs including annual audit costs; v) consultancy services for Mid Term Review (MTR) and impact assessment; vi) training for PMT and project coordination committee members; vii) consultants for identification and prioritization of future investments and project evaluation; viii) project launch; and ix) office equipment.

27

Annex 3: Implementation Arrangements Implementation Arrangements23

1. RGoZ’s PO-FEDP will be responsible for the overall management of the project. Actual implementation of the project will be coordinated by a PMT established by PO-FEDP and staffed by officials drawn from RGoZ. ZMC, the STDCA, MLHWE (DoSUP), PO-RCLG and the three Town Councils on Pemba will be recipients of the infrastructure investments and institutional strengthening inputs from the project. Additionally, they will participate by providing technical inputs and in supervision of subcomponents related to their jurisdictions.

2. Project Management Team: The Principal Secretary (PS), PO-FEDP, will be the Accounting Officer for the project with overall responsibility for accounting of project funds. PO-FEDP has already established the PMT consisting of: a Project Coordinator, a Project Financial Management Officer, a Project Procurement Officer, a Project Accountant, an Environment and Social Safeguards Officer, and an Office Management Secretary during project preparation and the same team will continue to be responsible for the project’s implementation. The PMT will be the only implementing agency for the project with overall responsibility for all procurement, financial management and reporting, monitoring and evaluation, coordination of all project activities and the provision of administrative and financial management functions.

3. Zanzibar Municipal Council: The Director of ZMC will lead the participation of the Council in receiving activities undertaken within its jurisdiction, namely: a) institutional strengthening; b) construction of surface water drainage; c) provision of street lighting; and d) solid waste management. The Director will be assisted by his team of relevant department heads who will contribute by providing technical supervision for activities related to their sphere of work.

4. Stone Town Conservation and Development Authority: The Director General (DG) of the STCDA will lead the participation of the Authority in receiving the technical, administrative and procedural aspects concerning the Mizingani Sea Wall subcomponent. The DG will oversee compliance of all project activities concerning the sea wall with all national and international requirements to ensure the Stone Town retains its World Heritage City status.

5. Department of Survey and Urban Planning (Ministry of Water, Construction, Energy and Lands): The Director of the DoSUP will lead the participation of the Department in receiving the technical assistance for preparing the structure plan for ZMC and its immediate periphery.

6. President’s Office – Revolutionary Council and Local Governments (PO-RCLG): The Principal Secretary of PO-RCLG will lead the participation of this office concerning project activities in the three Town Councils on Pemba Island.

23 RGoZ changed the names of the three participating ministries just before negotiations which were held on December 16, 2010.

Ministry of Finance and Economic Affairs (MoFEA) became President’s Office-Finance, Economy, Development Planning (PO-FEDP); Ministry of State Regional Administration and Local Government (MoSRALG) became President’s Office-Revolutionary Council and Local Government (PO-RCLG); and Ministry of Construction, Water, Electricity and Lands (MoCWEL) became Ministry of Lands, Housing, Water and Energy (MoLHWE).

28

7. Project Coordination Committee (PCC): A PCC has been formed and has been functional throughout the project preparation process. The committee is chaired by the Director of the Department of Policy and Planning, PO-FEDP and has representatives from ZMC, STCDA, DoSUP, PO-RCLG, each of the three Town Councils as well as from related agencies such as the Zanzibar Electricity Company, Zanzibar Water Authority, Tanzania Telecommunications Company Ltd.(TTCL), and the Aga Khan Cultural Services on Zanzibar. The role of the PCC is to provide a regular forum where cross agency and sectoral issues can be coordinated.

8. Project Implementation Manual(PIM): A PIM will be finalized before effectiveness with detailed descriptions of institutional arrangements, financial and accounting procedures, procurement, monitoring, evaluation, and other administrative and organizational arrangements for the implementation of the project. Adoption of a PIM is a condition for project effectiveness.

Ministry of Lands, Housing, Water and Energy (MLHWE)

President's Office- Finance, Economy and Development Planning (PO-FEDP, Zanzibar)

ZUSP Project Management Team (PMT)Project Coordination, Financial Management,

Procurement, Environment and Social Safeguards, Monitoring and Evaluation

President's Office - Revolutionary Council and Local Government

(PO-RCLG)

Zanzibar Municipal Council (ZMC)

3 Town Councils on Pemba Island

Stone Town Conservation and

Development Authority (STCDA)

Department of Survey and

Urban Planning (DSUP)

Institutional strengthening

Surface water drainage

Solid waste collection

Street lighting

Institutional strengthening

Small investments

Sea wall and promenade along Mizingani Road in Stone Town

Indicative structure plan for the ZMC and surronding areas

Project Coordination

Committee (PCC)

29

Financial Management and Disbursements

9. An initial financial management assessment was carried out in November 2008 after the PMT was established. The assessment was in accordance with the World Bank Financial Management Practices Manual issued by the Financial Management Sector Board. At that time, the financial management staff of the PMT did not have experience in managing World Bank project funds. However, during project preparation, the PMT’s FM team gained valuable experience in managing two tranches of a Project Preparation Advance (PPA). The PMT now has an experienced FM coordinator and an assistant. They have both received adequate training in FM and software use. Both FM officials have effectively managed two tranches of the PPA and the PMT has been preparing IFRs acceptable to the Bank. Project accounts for FY 2009 have been audited and received unqualified opinions. A second financial management review was conducted in March 2010. The objective of the assessments were to ensure that the Project Management Team within PO-FEDP as implementing entity has adequate financial management arrangements to ensure that: a) project funds will be used for the purposes intended in an efficient and economic way; b) project financial reports will continue to be prepared in an accurate, reliable and timely manner; and c) external audit report will be prepared in line with international accepted audit standards and issued on time as it has been for the PPA. In this regard, the assessment included a review of the existing financial management system, including budgeting, financial accounting, financial reporting, funds flow and disbursements, internal and external audit arrangements.

10. Budgeting: The overall project budget and a disbursement schedule will be included in the PO-FEDP annual budget. The Annual Work Plans and Budgets (AWPBs) will be prepared and approved based on the policy guidelines as per the Public Finance Regulations of July 2005. Detailed cost tables for the project will be prepared and will be agreed upon by negotiations.

11. Preparation of the AWPB will be participatory, and will follow PO-FEDP’s budgetary process. Budgets will need to be approved before the new financial year begins and monitored during project implementation using unaudited interim financial reports.

12. Accounting arrangement: ZUSP will maintain similar books of accounts to those for other IDA funded projects. The books of accounts to be maintained specifically for the project should thus be set up and should include: a Cash Book, ledgers, journal vouchers, fixed asset register and a contracts register. A list of accounts codes (Chart of Accounts) for the project has been drawn up by the PMT in consultation with the World Bank. The Chart of Accounts should be developed in a way that allows project costs to be directly related to specific work activities and outputs of the project. It has been agreed that all records and vouchers will be kept for a minimum of five years.

13. PO-FEDP has already appointed key fiduciary staff who will be working full time on this project. Staff of the PMT for ZUSP comprise of Project Coordinator, Finance Officer, Procurement Specialist, Safeguard Specialist, and an Accountant. The key staff members in the PMT’s fiduciary section are experienced and qualified. It is expected that this staffing arrangement will have to be maintained throughout the life of the project. All the fiduciary staff will need regular training on the more recent World Bank Financial Management and

30

Disbursement Guidelines. This will be arranged in consultation with the Country Financial Management and Procurement Specialists.

14. The books of accounts are being maintained on a computerized accounting system. The PMT is using Quick Book software which has the main account and financial modules. Training on the use of this software has been conducted during installation of the package and will continue to be provided by the software vendor as necessary. Project accounting arrangements shall comply with the Financing Agreement and government financial laws and regulations and specifically, in accordance with Regulation Public Finance Regulations of July 2005.

15. Internal control and internal audit unit: Internal control systems of PO-FEDP indicated satisfactory levels of segregation of duties and controls. The government’s regular financial rules and procedure stated in Public Financial Act 2005 that applies to ministry operations will be used in this project. This includes quarterly post audits by the Internal Audit unit of the ministry.

16. The project financial management manual (FMM) of procedure has been developed. The document covers all financial management and accounting requirement in terms of recording, internal control, disbursement procedures and reporting arrangement. This FMM will also be disseminated to all participating agencies before effectiveness.

17. The Internal Audit unit of the PO-FEDP is independent and is headed by the Chief Internal Auditor who reports directly to the Principle Secretary of PO-FEDP. The unit has an audit strategy and plan based on risk assessment of the ministry. The internal auditor’s work related to the PO-FEDP will be monitored and reviewed by their Audit Committee as part of implementation support to ensure internal control systems are functioning adequately and that issues raised in the internal auditor’s report are addressed by management. The audit unit is comprised of three people with acceptable qualifications. The unit issues out reports of PO-FEDP’s operations on a quarterly basis, however the audit committee should meet more regularly in order to ensure that audit queries are being implemented. Strengthening of Internal Audit functions across government is underway. This includes capacity building of internal auditors in using modern international auditing standards.

18. Funds flow arrangement: The following bank accounts have already been opened in the Peoples’ Bank of Zanzibar for the PPA and will be maintained for the purposes of implementing of the project: (i) Designated (Special) Account: Denominated in US dollars, disbursements from the IDA Credit will be deposited in this account; (ii) the project has an operating account where funds can be transferred from the Designated Account to make project payment in T SH. The signatories for all these accounts will be as documented in the FMM.

19. Funds flow arrangements for the project are as follows: Upon effectiveness, the PMT will prepare a four- month cash flow forecast for the project based on an approved work plan and budget and thereafter submit the Withdrawal Application to the World Bank. The Bank will process the withdrawal application and deposit an advance on the project’s designated account which will be managed by the PO-FEDP through the Project Management Team.

20. Disbursement methods: The project will not be ready for report-based disbursements by effectiveness. Thus, at the initial stage, the transaction-based disbursement procedures (as

31

described in the World Bank Disbursement Handbook) will be followed, i.e. direct payment, reimbursements, special commitments and replenishments of the Special Account. The World Bank staff will continue training the project staff during supervision missions or through seminars in order to improve the quality of Financial Management Reports (FMRs). When the reports are adequate and produced on a timely basis, and the borrower requests conversion to report-based disbursements, a review will be undertaken by the World Bank to determine if the project is eligible report-based method of disbursements.

ZUSP FUNDS FLOW CHART

21. Reporting arrangements: The project will provide a quarterly Interim Financial Report (within 45 days after the end of the quarter) and annual Financial Report (within six months after the year-end) to the World Bank in order to monitor the utilization of funds for the project. Formats for these reports should be generated from the financial management system of the ZUSP. There will be clear linkages between the information in these reports and the Chart of Accounts.

22. World Bank will have the right, as reflected in the Financing Agreement, to suspend disbursement of the Funds if reporting requirements are not complied with.

23. In addition, the financial statements should be prepared in accordance with International Public Sector Accounting Standards (which inter alia includes the application of the cash basis of recognition of transactions). The Financing Agreement will require the submission of audited financial statements to the Bank within six months after the financial year end.

24. External audit arrangement: As per Public Finance Act, 2005, the Controller and Auditor General (CAG) has the responsibility for the audit of all government organizations including local authorities and public corporations and donor funds. The CAG has the power to

IDA

Designated Account (US$) in People's Bank of

Zanzibar (PBZ)

Transactions paid in either USD or TZS

Project Operations Account (T Sh)

Direct Payments on behalf of PO-FEDP

/ ZUSP

Acc

ount

abili

ty

32

authorize any person registered as an auditor to conduct an audit on his behalf. ZUSP annual external audit will be carried out by the CAG or such other person registered as an auditor and approved by the Controller and Auditor General. The Auditors will provide a single audit report on the project financial statements (which includes the Designated Account).

25. The audit will be done based on International Standards on Auditing (IFAC/INTOSAI) and the audit report will be submitted within six months after the end of the financial year. In addition, the Auditors will provide a detailed management letter containing the auditor’s assessment of the internal controls, accounting system and compliance with financial covenants in the Financing Agreement. Terms of reference for the external audit have been agreed upon. The CAG has conducted the audit of the PPA for fiscal year 2008/2009.

Procurement

26. Procurement for the proposed project will be carried out in accordance with the World Bank’s “Guidelines: Procurement under IBRD Loans and IDA Credits,” dated May 2004, revised October 2006 and May 2010, and “Guidelines: Selection and Employment of Consultants by World Bank Borrowers,” dated May 2004, revised October 2006 and May 2010, Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants, dated October 15, 2006 and the provisions stipulated in the Financing Agreement.

29. Procurement activities under the project will be carried out by procurement staff of the PMT established within the PO-FEDP with the support of their Tender Board. Beneficiary agencies including the ZMC, STCDA, DoSUP and the Town Councils of Chake Chake, Mkoani and Wete will be responsible for the provision of technical inputs and will also participate in the evaluation of bids.

30. An assessment of the capacity of the PMT to implement procurement actions for the project was carried out in August, 2010. The assessment reviewed the organizational structure for implementing the project and the interaction between the staff responsible for procurement and other relevant central units for administration and finance. The key issues and risks concerning procurement for implementation of the project have been identified and mitigation measures agreed with the PMT. The main risk is lack of experience with the Bank’s procurement procedures among staff.

31. Training in basic and advance procurement will be required for most of the staff in order to ensure that all procurement staff in the PMT as well as the Procurement Management Department (PMD) of the PO-FEDP is knowledgeable about Bank and government procurement procedures. Training will also be required for the staff in the other agencies which will be involved in the implementation of the project i.e. Municipal and Town Councils specifically for those who are involved in the evaluation of bids and proposals.

33

Details of the Procurement Arrangements Involving International Competitive Bidding and Other Methods Works, Goods and Non Consulting Services List of contract packages to be procured following ICB / direct contracting and other methods:

1 2 3 4 5 6 7 8

Ref. No.

Contract (Description)

Estimated Cost

($’000)

Procurement Method

Prequal (yes/no)

Domestic Preference

(yes/no)

Review by Bank

(Prior / Post)

Expected Bid-

Opening Date

W1.1 Rehabilitation of ZMC Office 600 NCB N/A N/A Post June 2012 W1.2 Rehabilitation of ZMC workshop 100 NCB N/A N/A Post June 2012 W1.3 Construction of Storm Water

Drains 8,300 ICB N/A N/A Prior Aug 2011

W1.4 Installation of Street Lighting and fixtures

1,700 NCB N/A N/A Post Aug 2012

W1.5 Rehabilitation and Construction of Solid Waste Collection Points

1,000 NCB N/A N/A Post Aug 2011

G1.1 Supply of Office Equipment and Computers

30 Shopping N/A N/A Post July 2011

G1.2 Supply of Office Furniture 60 Shopping N/A N/A Post June 2013 G1.3 Supply of Computer Software 40 Shopping N/A N/A Post July 2011 G1.4 Supply of Equipments for ZMC

Workshop 145 NCB N/A N/A Post June 2012

G1.5 Supply and Installation of VHF Radio Network

40 Shopping N/A N/A Post June 2012

G1.6 Supply of Trucks for Sewage Disposal

845 ICB N/A N/A Prior June 2013

G1.7 Supply of Vehicles for Five Departments

125 NCB N/A N/A Post June 2013

G1.8 Supply of Motorcycles 20 Shopping N/A N/A Post June 2012 G1.9 Supply of Equipments for

Department of Survey and Urban Planning

305

NCB

N/A

N/A

Post

July 2011

G1.10 Supply of Motor Vehicles 45 Shopping N/A N/A Post July 2011 G1.11 Supply of Solid Waste Collection

Facilities 410 NCB N/A N/A Post June 2012

G1.12 Supply of Solid Waste Disposal Equipment

580 ICB N/A N/A Prior June 2012

G2.1 Supply of Three Small Trucks 180 NCB N/A N/A Post July 2011 G2.2 Supply of Three Double Cabin

Pick Ups 120 NCB N/A N/A Post July 2011

G2.3 Supply of Motorcycles 20 Shopping N/A N/A Post July 2011 G2.4 Supply of Office Equipment and

Furniture 180 NCB N/A N/A Post July 2011

G2.5 Supply of Vehicles for MoRALG in Pemba

45 Shopping N/A N/A Post July 2011

G3.1 Supply of Office

Equipment/Furniture 30 Shopping N/A N/A Post July 2011

G3.1 Supply of Motorcycles 10 Shopping N/A N/A Post July 2011

34

(a) ICB contracts for works estimated to cost US$5,000,000 and above equivalent per contract, for goods estimated to cost US$500,000 and above equivalent per contract, and all direct contracting will be subject to prior review by the Bank.

Consulting Services List of consulting assignments with short-list of international firms and other selection methods:

1 2 3 4 5 6

Ref. No. Contract Estimated

Cost ($’000)

Selection Method

Review by Bank

(Prior / Post)

Expected Proposals

Submission Date

C1.1 Technical Assistance for Change Management 575 QCBS Prior July 2011 C1.2 Technical Assistance for Financial

Management, Procurement and Revenue Collection

580 QCBS Prior Dec 2011

C1.3 Technical Assistance for Improving Public Opinion of ZMC Services

300 QCBS Prior Mar 2012

C1.4 Design and Preparation of Bidding Documents for ZMC Office and Workshop Buildings Renovation

150 CQS Post Dec 2011

C1.5 Study for Indicative Structural Plan for Zanzibar Municipalities and Surrounding Areas

1,100

QCBS

Prior

July 2011

C1.6 Study for Community Participation Campaign 250 QCBS Prior July 2011 C1.7 Construction Supervision of Storm Water

Drainage 458 QCBS Prior June 2011

C1.8 Construction Supervision of Street Lightning 85 CQS Post June 2011 C1.9 Construction Supervision of Solid Waste

Collection Points 60 CQS Post June 2011

C1.10 Consultancy Services for the Mizingani Sea Wall including Pass Through Works

7,950 SSS Prior July 2011

C2.1 Technical Assistance to Three Town Councils

in Pemba 200 QCBS Prior July 2011

C2.2 Consultancy Services for Preparation Pemba Town Councils Investments

220 QCBS Prior July 2011

C3.1 Monitoring and Evaluation Study 100 IC Prior July 2012 C3.2 Environmental and Safeguards (ESMP & RAP)

Monitoring 130 IC Prior June 2011

C3.3 Mid-Term Review Study 100 IC Prior July 2013 C3.4 Project Audit Study 110 IC Prior July 2011 C3.5 Resettlement Action Plan Monitoring Study 25 IC Post June 2011 C3.6 Identification of Future Investment Study 500 QCBS Prior July 2011 C3.7 Project Evaluation Study 30 IC Post June 2011 C3.8 Environment and Social Audit Study 40 CQS Post July 2012

C3.9 Support to Pemba Investment Identification 100 CQS Post June 2011 C3.10 Annual Survey 125 IC Prior July 2011 (a) Consultancy services estimated to cost US$200,000 (firm) and US $100,000 (individual) and above equivalent per contract and all single-source selection of consultants will be subject to prior review by the Bank.

35

(b) Short lists composed entirely of national consultants: Short lists of consultants for services estimated to cost less than US$200,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. Advertising: All works and goods contracts to be procured under ICB and consultancy services contracts estimated to cost US$200,000 and more equivalent per contract shall be advertised in UNDB online and dgMarket in addition to advertising in national news paper(s) of wide circulation.

Thresholds for Procurement Methods and Prior Review: Thresholds for procurement methods and for prior review are presented in the table below.

Expenditure

Category Contract Value

Threshold (US$) Procurement /

Selection Method Contracts Subject to

Prior Review

Works

≥5,000,000 ICB All <5,000,000

NCB

None (Post review) unless

specified in the PP <50,000 Shopping None (Post review)

All values Direct Contracting All

Goods

≥500,000 ICB All <500,000

NCB

None (Post review) unless

specified in the PP <50,000 Shopping None (Post review)

All values Direct Contracting All

Consulting Services - Firms1

≥ 200,000 QCBS/ Other24

All

(QBS/FBS/LCS)

< 200,000 CQS/ Other25

None (Post Review) (QBS/FBS/LCS)

All values SSS All

Consulting Services – Individuals (IC)

≥100,000 IC - Qualification All

<100,000 IC - Qualification None (Post review)

All Values IC - SSS All

Terms of Reference for all contracts will be cleared by the Bank. Risks and Mitigation Measures: Procurement risk for the project is assessed as Medium - I. The following measures were agreed to mitigate the risks:

24 Shortlists for consultancy services for contracts estimated to cost less than US$200,000 equivalent per contract may be

composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. 25 QBS, FBS, and LCS for assignments meeting requirements of paragraphs 3.2, 3.5, and 3.6 respectively, of the Consultant

Guidelines.

36

• Inadequate Legal and Regulatory Framework: The World Bank Guidelines, Standard Bidding Documents and Standard Forms of Evaluation to be used for the procurement of the contracts under the project.

• Weak Procurement Capacity: Train procurement staff within PO-FEDP – Zanzibar and those to be involved in procurement within implementation agencies so as to upgrade their procurement skills.

Environmental and Social Safeguards

32. The PMT’s Environmental and Social Safeguards Officer will be responsible for regular monitoring of compliance of safeguards related issues. The Officer has been seconded from RGoZ’s Department of the Environment and will remain the main point of liaison with that Department and the other agencies supervising the technical implementation of subcomponents. Since the sea wall and its associated construction is within the Stone Town, the STCDA will provide oversight and supervision over all matters concerning cultural heritage and adherence to the prevailing conservation standards. The PMT, ZMC and STCDA will jointly ensure effective implementation of the ESMP. With respect to the construction of surface water drainage, solid waste management and street lighting, ZMC and PMT will be responsible for overall oversight and compliance with the ESMP. For the small civil works on Pemba Island, PO-RCLG with PMT assistance will supervise the implementation of environmental management plans that comply with local and national laws. 33. The project will support appropriate training prior to the implementation of the ARAP for the PMT, ZMC, STCDA and PO-RCLG officials who will be responsible for supervision of the environmental and social safeguards and will continue to provide regular assistance from relevant Bank staff based in the country and the region.

Monitoring and Evaluation

34. The PMT has overall responsibility for project implementation as well as the overall monitoring and evaluation of all project activities. The Project Coordinator will be responsible for the M&E function. An M&E consultant will be retained and who, in coordination with the ZMC, STCDA, DoSUP and PO-RCLG, will prepare quarterly progress reports. These reports will feed in to the bi-annual implementation support mission reports. In addition a user survey will be conducted to determine satisfaction of citizens with installation of street lights, surface water drainage, solid waste collection and the sea wall. While the data on implementation progress will be generated at the ZMC, STCDA, DoSUP and PO-RCLG, the PMT will be responsible for compiling the data and executing the surveys and regular evaluations as necessary to monitor progress on project indicators, with quarterly report updates on these indicators. Reporting formats will be indicated in the operational manual and will include relevant environmental and social monitoring. 35. An M&E training program for participating entities will be conducted within the first four months of the project to ensure common understanding of reporting formats and processes. A mid-term review will be conducted within 30 months of project implementation to evaluate progress and determine whether the project should refocus activities.

37

Role of Partners

36. ZUSP will benefit from continued support by: (a) the AKTC which will extend financial and project management support toward the urban design, engineering design, construction supervision and ensuring consistency and compliance with internationally accepted best practise in physical cultural resource conservation within World Heritage Cities; and (b) the KfW will continue to provide technical assistance to the ZMC toward institutional strengthening and implementation support in the areas of storm water drainage and solid waste management.

38

Annex 4: Operational Risk Assessment Framework (ORAF)

Project Development Objective(s)

Improve access to urban services in Zanzibar and conserve the physical heritage at one public location within the Stone Town

PDO Level Results Indicators:

1. Households reporting flooding inside homes in ZMC project area (number) (CORE) 2. People in urban areas (ZMC) provided with access to regular solid waste collection under the project (number) (CORE) 3. The Stone Town retains status of World Heritage City 4. Direct project beneficiaries (number), of which females (%) (CORE: IDA)

Risk Category Risk Rating Risk Description Proposed Mitigation Measures Project Stakeholder Risks

Medium-I Coordinating multiple project activities through different entities may stretch the PMT’s limited implementing / facilitation capacity.

Using two tranches of the PPA, the PMT has had almost two years of experience in coordinating activities. Constraints were identified and processes put in place to resolve them. At appraisal, the PMT as well as the other participating entities have agreed to and are following effective coordination. In addition, the Project Coordination Committee has been functioning effectively and is able to resolve issues in a timely manner.

Implementing Agency Risks

Medium-I Local government and related agencies in Zanzibar do not have long standing experience of implementing infrastructure projects.

Overall project implementation responsibility has been placed in the PO-FEDP which has the strongest capacity for implementation in Zanzibar and is best suited to coordinate activities of all RGoZ Ministries and Departments. The Project Management Team within the PO-FEDP has received adequate training and gained project implementation experience through the effective management of the Project Preparation Advance.

Project Risks • Design

Medium-I Any public infrastructure developed within the confines of the Stone Town has to conform to internationally-accepted historic cultural heritage

The STCDA and the AKTC have held multiple consultations with UNESCO to keep the agency fully informed of design and technical criteria. The sea wall

39

Risk Category Risk Rating Risk Description Proposed Mitigation Measures conservation practices. If this is not done, the Stone Town would lose its listing on the international list thereby jeopardize the economy of Zanzibar. Engineering designs for the infrastructure investments may delay project implementation.

designs have been presented to and received support from the International Council on Monuments and Sites (ICOMOS). The World Heritage Committee responsible for listing and recognizing has provided its no objection to the project design. Detailed engineering designs for the surface water drainage, solid waste and the sea wall have been completed. Designs for street lighting are being updated to accommodate use of solar technology. Designs for the small investments on Pemba will be completed after project becomes effective and the TCs have followed a process of consultation and prioritization with their residents.

• Social and Environmental

Medium-I Being a Category A project and with infrastructure investments being made within a World Heritage City location, safeguard policies need special and constant attention.

The PMT has had an Environmental and Social Safeguards Coordinator from its inception two years ago. The Officer is deputed to the PMT from the Department of the Environment. The officer has and will continue to receive appropriate training and exposure to similar projects in the region. The ZMC and STCDA will also receive adequate training in monitoring and supervision of safeguards. The PMT will recruit an environment and safeguards consultant to assist in the monitoring the ESIAs and ARAP during the construction phase of the Sea Wall and the drainage works. Moreover, the Bank team’s environmental and social safeguards experts are based in the region and will be available for immediate attention as and when required.

• Delivery Quality

Medium-I Quality of investments may be impacted during implementation.

STCDA and ZMC have considerable experience of having completed the Forodhani Park of which the sea wall is an extension. ZMC has implemented two earlier phases of KfW supported drainage and solid waste management investments and investments under the project are an extension of previous work. To buttress the experiences, the project will support dedicated technical supervision of all infrastructure investments.

40

Overall Risk Rating at

Preparation Overall Risk Rating During

Implementation Comments

Medium-I High

Risk rating during implementation is rated as high because the PMT does not have the experience of managing the implementation of a World Bank supported project. Additionally, there are multiple agencies which will participate in the project which will require increased coordination. The rating will be re-visited at mid-term.

41

Annex 5: Implementation Support Plan Strategy and Approach for Implementation Support 1. The strategy for implementation support (IS) has been developed based on almost two years of experience gained during project preparation and utilization of a US$ 1.4 million PPA.

2. Procurement: Implementation support will include: a) enabling formal classroom training as well as mentoring by Bank staff to members of the PMT and staff of the implementing entities; b) reviewing procurement documents and providing timely feedback to the PMT; c) providing detailed guidance on the Bank’s Procurement Guidelines to the PMT; d) monitoring procurement progress against the detailed PP; and e) encouraging regular contacts between the Zanzibar PMT and the Project Support Team in the Dar es Salaam City Council where there is considerable expertise in implementing similar project activities.

3. Financial management: Support will be provided through regular review of and support for the PMTs financial management activities, including but not limited to, accounting, reporting and internal controls.

4. Environmental and Social Safeguards: The Bank team will actively support the PMT’s Environmental and Social Safeguards Officer in implementation of the agreed actions in the ESMPs and specifically in the implementation of the ARAP. The PMT will employ an Environment and Social Safeguards consultant who will assist in the monitoring of the ESMP and ARAP during the construction phase.

5. Monitoring and Evaluation: Each subcomponent implementing entity will prepare quarterly reports on activities. The PMT will employ a M&E consultant who will collect and collate the information on subcomponent progress and prepare a quarterly M&E report which will be used to inform the IS missions and in reporting on project progress.

Implementation Support Plan 6. A majority of the Bank’s IS team members, including the Task Team Leader, are either based in the Dar es Salaam Country Office or in the Region. This will ensure timely, efficient and effective implementation support to the PMT and the other implementing entities. Formal IS missions and field visits will be carried out semi-annually. In addition, since they are based in the country, majority of the Bank’s IS team will be available to provide assistance at any time.

7. Technical inputs: The team’s municipal engineer will conduct site visits on a semi-annual basis throughout project implementation. Engineering inputs can also be provided as and when required. Engineering and related inputs are required to review bid documents, technical specifications and fair assessment of the technical aspects of bids. During construction and commissioning, technical supervision is required to ensure technical contractual obligations are met. Since the technical specifications and construction processes followed in the implementation of the Forodhani Park will be continued in the construction of the Mizingani Sea Wall, the Aga Khan Trust for Culture which has gained very valuable implementation experience in the construction of the Forodhani Park has agreed to provide technical supervision for the

42

Mizingani Sea Wall. Construction supervision consultants will be retained to supervise the drainage, solid waste and street lighting subcomponents.

8. Fiduciary requirements and inputs: Regular hand-holding and on-the-job mentoring by the Bank’s financial management specialist and procurement specialists will be available as per the practice established during project preparation. The PMT will be facilitated to identify capacity building needs to strengthen its financial management capacity and to improve procurement management efficiency. Both the financial management and the procurement specialists are based in the country office to provide timely support. Additional support from Washington DC will be available in the areas of procurement. Formal support for financial management will be carried out semi-annually, while procurement supervision will be carried out on a regular basis as required by project activities.

9. Safeguards: Inputs from an environment specialist (based in the country office) and a social specialist (based in the region) will be available throughout the project period. They will provide regular support to the PMT’s dedicated Environmental and Social Safeguards Officer through regular and constant monitoring of social and environmental issues. Training is required on environment monitoring and reporting. On the social side, supervision will focus on the implementation of the agreed ARAP. Field visits are required on a semi-annual basis. UNESCO will be invited to join the Implementation Support Missions to ensure the project is implemented according to the World Heritage Council’s requirements.

10. Operations: A consultant operations officer, based in Washington DC will be available to the PMT for regular advice and mentoring via email and telephone.

The main focus of implementation support is summarized below.

Time Focus Resource Estimate First twelve months

Team leadership TTL 6 SWs Technical and procurement review of construction and bidding documents

Municipal engineer (consultant) 4 SWs Procurement specialist(s) 4 SWs

Financial management FM specialist 2 SWs

Institutional strengthening of ZMC and 3 TCs Urban institutional strengthening specialist (WBI) 4 SWs

Environmental safeguards Environmental specialist 4 SWs

Social Safeguards Social sector specialist 4 SWs Operations Operations consultant 2 SWs

12-48 months

Team leadership TTL 4 SWs

Technical and procurement review Municipal engineer (consultant) 4 SWs Procurement specialist(s) 4 SWs

Financial management FM specialist 2 SWs

Institutional strengthening of ZMC and 3 TCs Urban institutional strengthening specialist (WBI) 4 SWs

Environmental safeguards Environmental specialist 2 SWs Social Safeguards Social sector specialist 2 SWs Operations Operations consultant 2 SWs

SWs: Staff Weeks

43

Annex 6: Team Composition

World Bank staff and consultants who worked on the project:

Name Title Unit Barjor E. Mehta Sr. Urban Specialist AFTUW David M. Mulongo Urban Specialist AFTUW Jane A. N. Kibbassa Sr. Environmental Specialist AFTEN Yasmin Tayyab Sr. Social Development Specialist AFTCS Bella L. Diallo Sr. Financial Management Specialist AFTFM Gisbert Kinyero Procurement Specialist AFTPC Philip H. M. Beauregard Senior Counsel LEGAF Theresa M. J. Gamulo Procurement Analyst AFTUW Martin Onyach-Olaa Sr. Urban Specialist AFTUW Solomon Alemu Municipal Engineer, Consultant AFTUW Andre Herzog Sr. Urban Specialist WBIUR Vildan Verbeek-Demiraydin

Sr. Results Management Specialist SDNOK

Zara Inga Sarzin Sr. Urban Specialist AFTUW Abdu Muwonge Economist SASDU Rowena J. Martinez Operations Specialist, Consultant AFTUW Joseph A. Gadek Sr. Sanitary Engineer ETWEA Zhiyu Jerry Chen Young Professional ENVCF Marie Claire Li Tin Yue Sr. Program Assistant AFTUW Ruth T. Selegebu Team Assistant AFTC1

44

Annex 7: Economic and Financial Analysis

1. Introduction. This annex provides the cost benefit analysis associated with the project that aims at improving and developing services in ZMC and the three Town Councils on Pemba Island. It demonstrates the benefits and costs associated with the project. More broadly, the benefits fall into three main categories: improving urban services, enhancing the physical cultural heritage and strengthening institutional and fiscal capacity for urban management in Zanzibar. 2. At present, public infrastructure in the Stone Town which is a World Heritage City is in a dilapidated condition. Large areas of the larger ZMC are very dense, unplanned and informally developed and poorly accessed locations. The sea wall, which is key to maintaining UNESCO’s listing as a World Heritage Site, is on the verge of collapse and thus may contribute to the loss of a brand name and drop in tourism. In addition, an estimated 173 hectares in the Ng’ambo (outside of the Stone Town) areas within the council suffer from severe and persistent flooding. Given the coastal location with sharp concentrated rainfall bursts, coupled with a lack of institutional and financial capacity to implement effective drainage, more than 3,600 houses are affected or damaged annually. Roads are damaged, water supply systems break down, electrical systems are short circuited and cholera, together with other water borne diseases cause health problems in the ZMC.

3. The project will directly benefit an estimated total of 262,733 residents (as per the 2002 Census) of the greater ZMC and the three town councils on Pemba. An estimated 982,754 persons will indirectly benefit from the project. The project benefits include: (i) a reduction in the number of houses directly affected by flooding from rain water in the catchment of surface water drains constructed; (ii) establishment of modern street lighting; (iii) increase the number of households accessing regular solid waste collection; (iv) construction of the Mizingani Sea Wall to conserve and protect the cultural heritage of the Stone Town; and (v) strengthening the institutional capacity of ZMC and the three town councils of Pemba. An attempt is made to estimate some of these benefits in the sub-section on the economic rate of return.

4. Costs and benefits. Using assumptions based on current observations, costs and benefits are constructed to facilitate estimation of the potential economic rate of return associated with the ZUSP. A major caveat of this analysis is the inability to quantify some aspects of costs and benefits, such as health benefits due to improved solid waste disposal and surface drainage systems.

5. Construction of the Mizingani sea wall. As noted in the main text of the PAD, a major section of the sea side of the Stone Town, which is the centre and the public face of the city’s heritage (which is also a living and functional city) is in danger of collapse. If there is no effort to rebuild this wall, the sea is most likely to destroy the cultural heritage of the Stone Town and the existing infrastructure. In other words, the alternative “option” of doing nothing would be very costly. Being listed as a World Heritage City gives the Stone Town a marketing “brand name” because such places are tightly controlled by UNESCO and places which carry this brand use it to market themselves on the international tourism market.

45

6. By building the sea wall, the project will safeguard (and enhance) the status and the brand name of the Stone Town. The project will enable the enhancement and restoration of a public seafront promenade along Mizingani Road while preserving and enhancing the traditional seafront setting and its historic and architectural context within the Stone Town. The 340 meter sea wall holds key infrastructure—road, sewer, water and electricity systems and protects historic structures of considerable significance. Collapse of the stone wall would lead to the collapse of the historic buildings, Mizingani Road and the network systems that run along and underneath the road. Consequences would be severe, the most extreme being loss of a key historical heritage and a brand name of Zanzibar making a huge dent on the tourism industry in Zanzibar, a key source of employment on the island. In addition, service delivery would deteriorate further. Therefore, preservation of the stone wall in Stone Town is very crucial. Direct benefits are: preservation of the value of the buildings in the Stone Town and value of preserved infrastructure, including the stone wall. The indirect benefits are due to the increase in tourism to Zanzibar26

.

7. The following assumptions are used to estimate the direct benefits.27

i. Value of historic buildings: The value of such buildings is currently estimated at US$ 1,200 per square meter for hotel properties. Out of the seven buildings in the vicinity of the Mizingani sea wall area, two are hotels currently under renovation. Both hotels occupy about 28 percent of the total area, roughly 6,000 square meters. All other buildings except one are public buildings (Palace Museum, Old Customs House and the Institute of Public Administration). The value per square meter for public buildings is estimated to fall between US$ 750 and US$ 900 per square meter. Altogether, public buildings occupy an estimated 7,130 square meters. It is assumed that over the life of the project the rental value of buildings will increase between 15 percent in 2011 and 21 percent in 2019.

ii. Replacement cost of infrastructure: Estimates suggest that per linear meter, the replacement cost for earthworks (roads) would be US$ 1,400; sewerage US$ 500; road works US$ 2,000; water systems US$ 500; storm water drainage US$ 500 and irrigation of the Forodhani park US$ 100. In total, an estimated US$ 5,500 per linear meter would be the total replacement cost of key infrastructures along the 340 meter Mizingani sea wall. If nothing is done, the value of the key infrastructure altogether would decline 10 percent per annum.

iii. Replacement cost of the sea wall: If the existing sea wall would collapse, the estimated replacement cost would be around US$ 15,000 dollars per linear meter. A total of 340 meters will have to be replaced. We assume that the replacement costs will increase at a rate half the inflation rate over the project life.

iv. Value of adjacent buildings: Approximately, around 450 square meters of land is occupied by adjacent buildings in the Mizingani sea wall area. The value of these adjacent buildings is already assumed to have increased. Assuming the value per square

26 In addition to the direct and indirect benefits, an important historical tree, the Banyan tree, will be conserved. See ESIA

background on more about the Banyan tree. 27 Source: Background report for ZUSP: “Proposed sea wall construction phase 2—comprising of new sea wall and associated

infrastructure works along Mizingani Road in Zanzibar.”

46

of these adjacent buildings is US$ 825, the total value of these buildings is around US$ 371,250.

8. Indirect benefits. With the collapse of the Mizingani wall and the ensuing collapse of key historic buildings, Zanzibar would lose a heritage brand negatively impacting the tourism industry which is a key source of foreign exchange to Zanzibar. The intrinsic value of the historic site is difficult to quantify but an effort toward doing so examines the earnings from tourism, in addition to the direct benefits estimated above. 9. The following assumptions are made to estimate the potential revenue projections from tourism:

i. On average every tourist to Zanzibar spends at least two days in the Stone Town; ii. The average spending per day per tourist is about US$ 100 (i.e. US$ 70 on hotel; US$ 30

in fees, transport and meals). Assumed to range between US$ 30 and US$ 300. iii. Using actual data on tourist arrivals in Zanzibar and assuming that tourism will grow

consistently by one percentage point from the estimated 134,954 tourists in 1999 -- in 2015 and 2019, the estimated number of tourists will be 208,172 and 338,795 respectively. This will enable Zanzibar to generate an estimated US$ 41 million and US$ 67 million respectively. However, this considers earnings due to the incremental number of tourists over the project life until 2019.

10. The above analysis demonstrates that investing US$ 8.289 million dollars to restore the Mizingani Sea Wall yields a Net Present Value (NPV) of US$ 15.03 million at a discount rate of 12 percent. The Internal Rate of Return (IRR) is 47 percent, suggesting that it is desirable to invest in the construction of the Mizingani sea wall. Other non-quantifiable benefits include increased urban aesthetics due to improvements along the 340 meter stretch with landscaping on the promenade and the development of a dual lane road that enhances public safety as the likelihood of accidents will reduce. 11. Benefits due to enhanced water drainage system. The project will establish storm water drainage systems in the areas outside of the Stone Town at a cost of US$ 10.8 million. Benefits will accrue in three areas: (a) minimizing costs to households due to flooding; (b) reduced incidence of water borne diseases; and (c) increase in value of land or buildings in the adjacent areas where the water drainage system will be constructed. In the absence of surface water drains, flooding is regular and destructive. Stagnant water ponds covering more than 173 hectares are common and directly affect around 3,645 houses which have to be periodically abandoned or where residents have to spend considerable resources to build defensive structures around doors or annually re-strengthen the shallow foundations. If nothing is done, the total costs will increase annually by 10 percent over the life of the project. These costs constitute potential savings that households may allocate to alternative uses, since the project will establish improved drainage that will provide protection against floods. 12. Total economic costs due to flooding are derived based on the following assumptions:

47

i. The estimated areas are based on an average house size of 150 square meters (15m x 10m);

ii. The cost for flood prevention and renovations after every flood is US$ 5.0 per square meter;

iii. Area of houses not considered fit for occupancy during floods; iv. Social costs such as hardship, dislocation, transport, etc. are not included herewith;

and v. Population growth rate is assumed to be 4.5 percent over the 2002 census.

13. Under these assumptions, it is estimated that about US$ 4.429 million will be incurred by the household directly affected by floods in 2010. If nothing is done, the situation will deteriorate and thus the value of the buildings will decline at a rate of 5 percent per annum. Besides the household savings due to improved surface drainage systems, the value of houses will increase. Under these assumptions, cost benefit analysis suggests that investing about US$ 10.8 million generates a net present value of about US$ 20.64 million; however, with a low internal rate of return of 7 percent. 14. However, this analysis does not take into account other key benefits such as: (a) increase in the value of unsold land where the surface drainage systems will be constructed; (b) increase of value of properties in the overall neighborhoods near where the systems will be established; (c) decrease in the cost of reconstructing / maintaining public infrastructure after every flood; (d) reduction in the incidence of diseases and health benefits for the general population attributable to improved surface drainage systems. Therefore, the NPV and IRR computed in this case may underestimate the potential benefits due to investing in surface drainage systems.

15. Benefits due to street lighting within the ZMC. The project will install street lighting along select roads outside of the Stone Town and on one section of a pedestrian street and small public square within the Stone Town. Streetlights will increase the use of public space after dark and this would be associated with increased spending in the commercial establishments along such roads. 16. To arrive at the potential benefits due to establishment of street lights, the following assumptions are made:

i. Assessment of potential sales made by shops of different sizes (small, medium and large firms) in the project areas that are expected to receive street lights. Such assessments are constructed for potential sales in good and bad economic situations. For example, a small shop may make sales of T SH 40,000 and T SH 25,000 per day in good and bad times respectively. This translates into sales of T SH 5,000 per hour and T SH 3,125 per hour.

ii. Average working hours: On average, shops are assumed to be open for 8 hours daily and operate 22 days in a month.

iii. Rental cost: Without street lights, rents are assumed to be T SH 30,000, T SH 50,000 and T SH 120,000 per month respectively for small, medium and large shops. Rental costs are included in the computations because once streetlights are provided it is likely that both sales per hour as well as shop rents will increase. We use the rental cost of similar shops within ZMC, but where presently street lights exist to mimic what will likely be the

48

situation when street lights are provided in areas covered by the project. This analysis does not attempt to compute the value of the shops due to introduction of streetlights but considers the potential increase in sales. On an hourly basis, this translates into T SH 125, T SH 208.33, and T SH 500 for small, medium and large shops. This analysis does not compute other costs and thus no attempt is made to compute profits. Sales per hour are calculated net of rental costs.

iv. Hours of operation: It is assumed that streetlights would increase hours of operation for the shops by one hour. At the outset of the project, it is unlikely to see a huge behavior change among shop owners to stay longer at their business premises. Roughly, the estimated increase in sales per hour due to street lights are T SH 8,750, T SH 9,659, and T SH 6,136 for small, medium and large size shops respectively.

v. Number of establishments: The total number of establishments along where the lights will be established is about 2,510 small size shops, 549 medium size shops and 40 large size shops. The analysis does not attempt to estimate the benefits of streetlights to households with houses situated along the areas where the project will be working. In addition, there are other unquantifiable benefits of public safety.

17. Cost benefit analysis based on the above assumptions suggests that investing US$ 2.18 million in street lighting yields a net present value of US$ 1.31 million and an IRR of 28 percent. 18. Benefits due to improved solid waste collection. The project would invest US$ 2.436 million in solid waste collection and it’s transportation within the Zanzibar Municipal Council.

19. The following assumptions are made to arrive at estimates for possible quantifiable benefits from solid waste collection and its transportation under the project:

i. Cost per ton: It costs ZMC US$ 14 per ton to collect and dispose solid waste; ii. Overall costs: At present the ZMC produces about 216 tons of solid waste per day; of

this, only 40—45 percent is collected and disposed. The total current cost to collect and dispose the waste is US$ 3,161 per day or around US$ 514,382 dollars per year. With 47,000 households, it translates into a US$ 11 subsidy to every household. It is assumed that costs for such collection will decline to about US$ 400,000 dollars28

iii. Service fees: It is estimated that there a total of 4,756 potential ‘service charge payers’ classified in high, medium and low categories across the ZMC. This analysis assumes that: a) from the high category, around 50, 60 and 80 percent will pay service charges in year 1 (2012), year 2 (2013) and year 3 (2014) after which this rate would remain at 80 percent until the end of the project; b) from the medium category, about 20, 40 and 50 percent will pay service charges in 2012, 2013 and 2014 respectively after which this rate would remain at 50 percent until the end of the project; and c) from the low category, there is little expectation of them paying service charges at the start of the project but 5 and 7 percent will pay service charges in 2013 and 2014 respectively. Under these assumptions, the potential service charges to be expected by the ZMC will be US$ 50,969 in 2012, US$ 71,093 in 2012 and US$ 92,811 in 2014.

.

28 The weakness of this assumption is that it may lead to underestimating the potential gains likely due to improved efficiency in

the operations of the ZMC.

49

20. However, many potential benefits are not quantified in the above analysis. Benefits from health gains due to better solid waste disposal and the enhanced organizational aspects in the collection and transportation of solid waste that will bring about more efficiency in basic service delivery are not included. Thus, there is likely to be reduced transaction costs incurred by the ZMC in the collection and transportation of solid waste. 21. Institutional strengthening and sustainability. At a cost of 3.6 million, the project will finance the preparation of a strategic institutional change management strategy, create a supportive operating framework for municipal service delivery; enhance own source revenues and effective financial management; and improve the municipality’s interface with citizens. Strengthening urban local governments to better plan and execute their roles and responsibilities will improve the efficiency in the delivery of basic services. Unfortunately, the benefits due to institutional strengthening are difficult to quantify.

50

Annex 8: Environmental and Social Impact Assessments 1. The Mizingani Sea Front: The sub-project area of the proposed development is entirely contained within the Stone Town which is a densely populated urban area of historic coral stone and lime washed buildings interconnected by a web of narrow alleyways. The alleys are flanked by a variety of small shops and stalls catering both to the tourist and local market. Mizingani Road is situated along the northern part of the Stone Town Seafront connecting Forodhani Gardens and the Seafront beyond to the Port Precinct. Given its historic importance, the Stone Town is listed as a World Heritage City by UNESCO and thereby triggered OP 4.01 as it potentially may have considerable environmental impacts, OP 4.11 as it is a UNESCO World Heritage Site and OP 4.12 for potential temporary dislocation, loss of assets, homes and access to services.

2. The Mizingani Sea Wall construction component will include: i) construction of approximately 315 meters of the seawall, potential land reclamation of approximately 5 meters beyond the existing footing, including appropriate backfill and foundation work; ii) refurbishment of the underground infrastructure including: water, sewer, storm and sewer, these will be located below the roadbed of Mizingani Road; iii) resurfacing of the road and introduction of traffic calming and pedestrian safety measures ; and iv) creation of a pedestrian promenade up to 5.8-meter wide, including planting, street lighting and street furniture along the sea side. The sea wall with a promenade and associated landscaping will complete the sea front side of the Stone Town Conservation and Development Plan prepared by the STCDA and adopted by the RGoZ. The sea wall forms part of the iconic public face of the Stone Town. The Mizingani Sea Front improvement will be a continuation of the Forodhani Park renovation work which was completed with the assistance and involvement of the Agha Khan Trust for Culture (AKTC). The sea wall’s architectural, landscaping and engineering designs have been prepared by the AKTC according to the strict conservation guidelines developed by the Stone Town Conservation Development Authority (STCDA) and in consultation with UNESCO. The sea front is presently used as a landing and docking site by the fisher community and the tourist boats.

3. Stakeholder consultations formed an integral part of the ESIAs to provide the public with sufficient and accessible information about the project. Information about the project was widely spread through letters, posters and focus group meetings to stakeholders raging from community representatives, central and local government authorities, business/commercial entities, CBOs/NGOs, Tourism and media. Consultations were focused to key stakeholders that are relevant to the project with a view to involve them in the decision making process by taking into consideration their views, concerns and suggestions. Issues and concerns raised were accordingly incorporated into proposed designs and in the assessment of the identified impacts and mitigation measures where relevant have been recommended.

4. The ESIA for Mizingani sea wall and associated promenade29

29 This ESIA has been disclosed in-country and at the InfoShop and consulted upon. The Bank has cleared the ESIA and an

Executive Summary has been sent to the Executive Directors for information.

has provided recommendations for designs appropriate to address key issues and concerns, particularly during construction phase such as traffic congestion, prohibited use of certain parts, access to adjacent

51

buildings, etc. An Environmental and Social Management Plan (ESMP) to mitigate anticipated negative impacts for specific investments have also been prepared. The ESMP has specific responses to issues raised in direct relation to the proposed project and focus on reducing impacts, enhancing benefits and avoiding unnecessary damage to the natural, cultural and socio-economic environment.

5. The Physical Cultural Heritage Review in the Environmental & Social Impact Assessment (ESIA) provides an overview of the heritage resources and status of the project area. The Stone Town was identified and described by the World Heritage Convention as “as a fine example of the Swahili coastal trading towns of East Africa. It retains its urban fabric and townscape virtually intact and contains many fine buildings that reflect its particular culture, which has brought together and homogenized disparate elements of the cultures of Africa, the Arab region, India, and Europe over more than a millennium”30

6. For the Sea Wall ESIA, stakeholders were consulted by means of three different approaches, namely key informant interviews, focus group discussions and stakeholder meetings (refer sea wall ESIA Section 2.2.3). The primary aim of the stakeholder meetings was: i) provide project information and progress to the Ministry of Lands, Housing, Water and Energy; ii) inform the STCDA of the process being undertaken and identify any concerns or requirements they may have; and iii) engage with land and business owners, local community leaders, government officials, as well as other stakeholders and identify issues and concerns with regard to the proposed development (refer to Sea Wall ESIA section 5.1.3). The local users and stakeholders of the site-specific study are presented in Section 3.3.3 of the ESIA and section 5.2 of the ESIA provides details on the consultations that took place with these stakeholders.

.

7. The most dominant and significant group making use of the seafront is the boat or mashuwa operators. The estimated 20 mashuwas operating from the seafront use the beach front for two livelihood purposes, namely fishing and tourist jaunts. There are also a number of informal salesmen and vendors making use of the seafront and beach area for livelihood purposes. They can loosely be divided into two groups, namely mobile vendors selling novelty items to tourists, and locals selling small fish on small scale on or adjacent to the beach to the local community. The site-specific project area is also used by the local communities on a daily basis for activities such as swimming, playing soccer on the beach, and meeting friends along the seawall. During high tide, the children jump off the seawall into the ocean, both at the project area as well as along the length of Forodhani Park. A number of tourist activities also take place in the site-specific area, including: socializing at Mercury’s restaurant; boarding a mashuwa; visiting the Palace Museum; and general Stone Town sightseeing, using the project area as a thoroughfare.

8. The main concern regarding the project revolves around access to the beachfront, which is used by fishermen, tour operators and few vendors. This concern is relevant both to the construction phase of the project, as well as after construction has been completed, and is most significant for the fishermen and tour boat operators who launch their vessels from the beach in the study area. The owners and users of the building alongside Mizingani Road are anxious about

30 UNESCO World Heritage Convention Ref 173 Rev http://whc.unesco.org/en/list/173/

52

possible vibration that may occur during the construction phase. In addition, they are concerned about parking space for their vehicles as such space is already limited.

9. The proposed project area does not seem to hold the same significant cultural or historical value for the local community as is the case with Forodhani Park, but it is nevertheless an integral part of their day-to-day lives. The ESIA for the Mizingani Sea Front has developed concrete mitigation measures for each of the potential concerns identified by the stakeholders (Annex 4). The social benefits range from improved civic pride to improved traffic circulation and pedestrian safety whereas economic benefits include business opportunities for entrepreneurs and job creation.

10. Storm Drains & Waste Management: Zanzibar - Unguja Island is divided into three regions; Urban West, North Unguja and South Unguja and each region is divided into two districts. The proposed sub-project lies in the Urban District (Zanzibar Municipality) of the Urban West Region. The Urban West Region has an extremely high population density of 1,700 people / km² compared to 400 people / km² for Zanzibar–Unguja as a whole. These figures indicate one of the highest population densities in Africa. The Republic of Tanzania for example has a population density of 39 people / km².

11. The project location has numerous low lying areas (land depressions), natural streams and wetlands which have been largely disregarded by those settling in the area. The result is that houses are occasionally flooded during the wet season (between March and May and between October and December) and streets are regularly transformed into spontaneous storm water canals due to excessive water runoff. Stagnant water is a permanent feature in many subareas which breed mosquitoes and gives rise to a range of water-borne diseases such as diarrhea, cholera, typhoid and bilharzias. Poor management of solid waste in this densely populated area has aggravated the storm water drainage system. A few formalized areas for solid waste disposal have been demarcated in subareas, but are presently not well maintained. As a result, the area is generally littered and the limited storm water drainage is often obstructed by solid waste that is washed into natural water collection areas during the wet season.

12. Informal settlement patterns showed a total disregard for the ecological environment. The only matter that seemed to have been considered was to find a ‘plot of dry land’ on which a basic housing structure was built. The increasing demand for residential plots resulted in a gradual filling in of every available open space with housing. With the increased population, natural water courses and drainage paths are obstructed; the high density of structures diminished the natural capacity of the ground surface to absorb water and increased the amount of run-off in the areas; wetland areas are turned into residential plots. The net result is excessive flows of water through densely occupied areas and the formation of permanent and seasonal water ponds in built-up areas.

13. Solid waste management in the project area is a considerable hazard to the health of the population and the (future) functioning of the storm water drainage systems. In 2005, 27 percent households either used a refuse pit outside of the compound or 25 percent disposed their refuse outside the homestead compound (ESIA Figure 25). National figures for Zanzibar are a clear reflection of the limited management and implementation of waste disposal mechanisms with 46 percent of homesteads disposing their domestic refuse outside the compound. In the project area,

53

unmanaged refuse disposal causes regular obstruction of the storm water drainage systems. Domestic refuse is disposed randomly outside the compound and the flood prone areas are treated as de facto waste disposal areas. During the wet season waste is washed through the presently unplanned drainage paths leaving a trail of refuse.

14. One of the fundamental problems faced by the residents of Zanzibar town is the lack of a proper system for waste management and it is most apparent in the dense urban areas and informal settlements. Piles of waste are scattered in and around residential areas which leads to environmental and health problems. Few residents opt to bury their wastes close to their residences (Ameyibor et al 2003). Although burying waste adjacent to homes cannot be considered best practice, this is something of a practical option because there is no formal system. However, this is not a sustainable solution due to the volume of waste, which is likely to increase with time, and dense housing. Numerous waste pits means there is increased exposure to sources of potential pollution, including leachate that will drain from pits into soil and the shallow water table. As there is an inadequate sewerage system, grey water, i.e. used domestic water, is discharged haphazardly into the immediate environment causing pollution of surface water and, groundwater.

15. In this environment, the health and economic concerns are enormous relating directly to poor waste management and flooding and its associated impacts. For example; damage to homes, temporary loss of livelihood, loss of livestock, personal possessions and furniture; and spread of disease such as typhoid, cholera, diarrhea, and malaria caused by overflow of pit latrines.

16. Consultations for the drainage component were announced to the public and other stakeholders in January 2010 by sending letters, distributing background information documents, placing posters in public places, making telephone calls and holding focus group meetings with the authorities, NGOs and key stakeholders, as well as several community meetings in the project area. The consultants invited stakeholders to comment on the project and ESIA process. In line with international standards, project-affected groups and local non-governmental organizations (NGOs) have been consulted through a public participation process between January 2010 and June 2010. The methods of undertaking the consultation process are presented in detail in Section 5.5 of the Drainage ESIA31

17. The positive benefits of the project far outweigh the temporary inconvenience during construction. The risk to residential buildings and structures is moderate. It is expected that the drainage system in some areas will pass through narrow passages/paths with potential adverse

. Stakeholders were invited to participate and give comments on the ZUSP by attending meetings (focus group, one-on-one, open houses), by distribution of background information documents and displaying posters in public places with full contact details of the consultants. A database of stakeholders was set up at the outset of the project and maintained throughout the life of the ESIA. Key stakeholders were identified in consultation with the client, ahead of the project team undertaking field work in Zanzibar, January 2010. The database was added to as more stakeholders were identified during the course of the study. Complete details of the consultation process, list of stakeholders and the comments from the stakeholders are found in chapter 5 of the Drainage ESIA.

31 ESIAs have been disclosed in-country on August 4 and 13, 2010 and at the InfoShop on September 7, 2010 and consulted

upon. The Bank has cleared the ESIAs and Executive Summaries have been sent to the Executive Directors for information.

54

impact on the surrounding housing. An Abbreviated Resettlement Plan (ARAP) has been prepared, disclosed in-country and at the Info Shop, and consulted upon; the Bank has cleared the ARAP. It identifies less than 30 structures that will be affected during the construction phase to the extent that parts of walls will have to be demolished during the excavation and reinstated after the pipes have been laid. In only one instance will a part of a mosque (the ablution section) be demolished and rebuilt on a different part of the property. A further risk is the potential destruction of walls due to excavation of foundations or caving in of excavation walls. A number of fruit trees (coconut and banana) will be affected by the construction and will be permanently lost. Temporary obstructed access routes will require adequate and safe diversions especially where this affects school-going children. Present paths and access roads are very informal and often inaccessible due to excessive water runoff and flooding during the wet season. While the communities are well accustomed to finding alternative routes to local destinations during the flooding, access to services and homes will be mitigated during construction. Compensation costs will be borne by the RGoZ.

18. The reduction in stagnant water as a result of the new and rehabilitated drainage systems and the restriction of solid waste disposal to formalized and managed sites will be the most significant and positive impact of the proposed project. It is anticipated that this will reduce the incidence of diseases related to polluted and stagnant water and dispersed waste. It will also provide improved access to and use of areas (such as the sporting grounds) which are presently completely, partially or regularly flooded.

19. Street Lighting: In light of the preservation of the Stone Town as an ancient historical site and in view of its tourist attraction, the Zanzibar Municipal Council is planning to upgrade the street lighting in the area. The original layout of the town has been maintained during the ongoing restorative work and the area is still characterized by winding narrow streets lined by multi-storey buildings. During daytime, the town is a hub of activity. General trading stores and markets, tourist facilities and an assortment of business and government offices attract scores of people from all walks of life to the town. It also has a vibrant night life. The upgrading of street lighting will make the area more accessible for tourists and residents and improve the general visibility and safety in the area at night. Upgrading street lighting in the Stone Town will allow residents and tourists to appreciate the amenity value of the Stone Town and improve opportunities to serve the needs of visitors, residents and traders.

20. Small-scale investment projects on Pemba Island: The Pemba Island Town Councils will be assisted in prioritizing simple manageable works or procuring equipment that can be easily operated and maintained. The civil works financed by the subcomponent will have minor environmental impacts; these investments will be guided by environmental and social management plans acceptable to the Bank that comply with local and national laws. The Bank has provided guidance to the local government(s) on the preparation of the environmental management plans using a check-list format for low-risk typologies as summarized below.

21. Environmental Management Plan (EMP) Checklist and Format for Low-risk Topologies: An alternative to the commonly used “full text” EMP format is to have a checklist approach. The goal is to provide a more streamlined approach to preparing EMPs. This checklist-type format has been developed to provide “pragmatic good practice” and designed to be user friendly and compatible with safeguard requirements.

55

22. The checklist-type format attempts to cover typical mitigation approaches to common low-risk topologies with temporary localized impacts. It is anticipated that this format provides the key elements of an Environmental Management Plan (EMP) to meet World Bank Environmental Assessment requirements under OP 4.01. Such an EMP format has two sections:

23. Part I: constitutes a descriptive part (“site passport”) that describes the project specifics in terms of physical location, the institutional and legislative aspects, the project description inclusive of the need for a capacity building program and description of the public consultation process. This section could be up to two pages long. Attachments for additional information can be supplemented if needed.

24. Part II: includes the environmental and social screening in a simple Yes/No format followed by mitigation measures for any given activity and the monitoring plan for activities during project construction and implementation. It retains the same format required for standard World Bank EMPs. Application of the EMP-Checklist 25. The practical application of the EMP checklist would include the filling in of Part I to obtain and document all relevant site characteristics and activities. In Part 2 the type of foreseen works, as obtained from the design documents, would be checked and the resulting provisions listed below highlighted (e.g. by hatching the field or copy pasting the relevant text passages into the special provisions of the tender documents. The whole filled in tabular EMP is additionally attached as integral part to the works contract and, analogous to all technical and commercial terms, has to be signed by the contract parties.

26. For monitoring of the contractor’s safeguards due diligence, the designated construction inspector uses the monitoring plan in the checklist. This should be developed site specifically and in necessary detail, defining clear criteria and parameters which can be included in the works contracts, which reflect the status of environmental practice on the construction site and which can be observed/measured/ quantified/verified by the inspector during the construction works. The monitoring plan would be filled in during the design process to fix key monitoring criteria which can be checked during and after works for compliance assurance and ultimately the Contractor’s remuneration. Details of the EMP checklist and format are included in the PIM.