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Document ofThe World Bank
Report No: 201 57-CHA
PROJECT APPRAISAL DOCUMENT
ONA
PROPOSED LOAN
IN THE AMOUNT OF US$100.0 MILLION
TO THE
PEOPLE'S REPUBLIC OF CHINA
FOR THE
URUMQI URBAN TRANSPORT IMPROVEMENT PROJECT
November 27, 2000
Transport Sector UnitEast Asia and Pacific Region
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CURRENCY EQUIVALENTS
(Exchange Rate Effective April 2000)
Currency Unit = RMBRMB1 = US$0.12
US$1 = RMB 8.28
FISCAL YEARJanuary 1 December 31
ABBREVIATIONS AND ACRONYMS
ATC Area Traffic Control PSO Public Service ObligationAWP Annual Work Program RAP Resettlement Action PlanCBD Central Business District RFB Regional Financial BureauCCTV Closed Circuit Television RMB Renrnen Bi
CMC CMC Intemational Tendering Co (Subsidiary of China SCCTPI Shanghai City Comprehensive TransportationNational Machinery Import & Export Corporation) Planning Institute
EAP Environmental Action Plan SDPC State Development and Planning CommissionEA Environmental Assessment SEPA State Environment Protection AdministrationEIA Environmental Impact Assessment SMEDI Shanghai Municipal Engineering Design
InstituteEMP Environment Management Plan SOE State Owned EnterpriseFDPEO Financial Department of Project Executive Office TA Technical AssistanceFMS Financial Management System TOR Terms Of ReferenceGDP Gross Domestic Product TSP Total Suspended ParticlesICB Intemational Competitive Bidding UCC Urumqi Construction CommissionIPDP Indigenous People's Development Plan UCCTPI Ummqi City Comprehensive Transportation
Planning InstituteITC Interational Tendering Company UEPB Urumqi Environment Protection Bureau
|LRT Light Rail Transit UGB Ursmqi Greening BureauI MFB Municipal Financial Bureau UMEB Urnmqi Municipal Engneerng Bureau|MOF Ministry of Finance UMG Urunqi Municipal GovernmentMOFTEC Ministry of Foreign Trade and Economic Cooperation UPB Urumqi Planning BureauMVECS Motor Vehicle Emission Control Strategy UPSB Urumqi Public Security BureauNCB National Competitive Bidding UPTC Uramqi Public Transport CompanyNGO NDn-Governmental Organization UUTIP Urumqi Urban Transport
Improvement ProjectNMT Non-Motorized Transport VA Vehicle-ActuatedO-D Origin - Destination WB World BankPCD Project Concept Document WSA Wilbur Smith AssociatesPIC Public Information Center XEMC Xinjiang Environment Monitoring CenterPID Project Information Document XETAC Xinjiang Environment Technical
Assessment CenterPIP Project Implementation Plan XHDI Xinjiang Highway Design InstitutePEO Project Executive Office XSSRI Xinjiang Social Science Research InstitutePMO Project Management Office XUAR Xinjiang Uygur Autonomous Region
Vice President: Jemal-ud-din KassumCountry Director: Yukon Huang
Sector Director: Jitendra N. BajpaiTask Team Leader: Edward B. Dotson
CHINAURUMQI URBAN TRANSPORT IMPROVEMENT PROJECT
CONTENTS
A. Project Development Objective Page
1. Project development objective 22. Key performance indicators 2
B. Strategic Context
1. Sector-related Country Assistance Strategy (CAS) goal supported by the project 22. Main sector issues and Government strategy 33. Sector issues to be addressed by the project and strategic choices 4
C. Project Description Summary
1. Project components 82. Key policy and institutional reforms supported by the project 93. Benefits and target population 94. Institutional and implementation arrangements 10
D. Project Rationale
1. Project alternatives considered and reasons for rejection 122. Major related projects financed by the Bank and other development agencies 143. Lessons learned and reflected in proposed project design 144. Indications of borrower commitment and ownership 155. Value added of Bank support in this project 15
E. Summary Project Analysis
I. Economic 162. Financial 163. Technical 174. Institutional 175. Environmental 186. Social 207. Safeguard Policies 22
F. Sustainability and Risks
1. Sustainability 222. Critical risks 243. Possible controversial aspects 25
G. Main Loan Conditions
1. Effectiveness Condition 262. Other 26
H. Readiness for Implementation 27
I. Compliance with Bank Policies 28
Annexes
Annex 1: Project Design Summary 29Annex 2: Detailed Project Description 34Annex 3: Estimated Project Costs 42Annex 4: Cost Benefit Analysis Summary 43Annex 5: Financial Summary 59Annex 6: Procurement and Disbursement Arrangements 61Annex 7: Project Processing Schedule 69Annex 8: Documents in the Project File 70Annex 9: Statement of Loans and Credits 72Annex 10: Country at a Glance 76Annex I 1: Environmental Assessment and Environmental Action Plan 78Annex 12: Land Acquisition and Resettlement 90Annex 13: Review of Financial Management System 96Annex 14: Socio-Economic Survey 103Annex 15: Ethnic Minorities 108Annex 16: Project Summary Technical Analysis 115
MAP(S)
IBRD 30808R Road Network ImprovementsIBRD 30833R Traffic Signals and Area Traffic Control (ATC)IBRD 30847R Public Transport
CHINA
Urumqi Urban Transport Improvement Project
Project Appraisal Document
East Asia and Pacific RegionEASTR
Date: November 27, 2000 Team Leader: Edward B. DotsonCountry Manager/Director: Yukon Huang Sector Manager/Director: Jitendra N. BajpaiProject ID: P045915 Sector(s): TU - Urban TransportLending Instrument: Specific Investment Loan (SIL) Theme(s):
Poverty Targeted Intervention: N
Project Financing Data[Xm Loan [ ] Credit [ ] Grant [ Guarantee [ ] Other:
For Loans/Credits/Others:Amount (US$m): $100.0 Million
Proposed Terms: Variable Spread & Rate Single Currency Loan (VSCL)Grace period (years): 5 Years to maturity: 20Commitment fee: standard w/waiverFront end fee on Bank loan: 1.00%Financing Plan: Source Local Foreign TotalBORROWER 150.70 19.30 170.00IBRD 22.30 77.70 100.00
Total: 173.00 97.00 270.00Borrower: PEOPLE'S REPUBLIC OF CHINAResponsible agency: URUMQI MUNICIPAL GOVERNMENTUrumqi Urban Transport Improvement Project Executive Office (PEO)
Address: 88 Xinmin West Street, UrunmqiContact Person: Li Jing Hua, DirectorTel: (86-991) 461 5901 Fax: (86-991) 461-9200 Email:
Other Agency(ies):Urumqi Public Security Bureau Traffic Police Detachmnent (UPSB)
Contact Person: Mr. Chao Xuemin, Deputy DirectorUrumqi Public Transport Company (UPTC)
Contact Person: Mr. Zhang PingEstimated disbursements ( Bank FYIUS$M):
FY 2000 2001 2002 2003 2004Annual 0.00 21.20 26.20 37.00 15.60
Cumulative 0.00 21.20 47.40 84.40 100.00
Project implementation period: March 2000 - June 2005Expected effectiveness date: 03/22/2001 Expected closing date: 12/31/2005
oS PAD Fr_m R. v ,. 250
A. Project Development Objective
1. Project development objective: (see Annex I)
Foster a multi-modal urban transport system which is planned, designed and used for the safe, efficient andhealthy movement of people and goods.
2. Key performance indicators: (see Annex 1)
Key performance indicators are proposed in accordance with the project's major objectives:
Objective Strategy IndicatorsDevelop and manage the urban road * Develop high-capacity cross-town I* Cross town journey times onnetwork to support land use, transport road network to distribute local north-south corridorsand economic development plans traffic, open up new areas for * Traffic flow conditions (speeds)
development, and protect the in the "old" CBD areaCentral Busioess District (CBD) (particularly for buses)
* Improve network connectivity of * Network condition, budget, andlower-class roads unit cost of maintenance by class
* Strengthen road maintenance of roadwayIncrease the safety and efficiency of * Implement comprehensive traffic * Traffic speeds in CBD and keythe road network management techniques north-south corridors
* Conduct road user education * Increased throughput (in* Improve accident data collection person-trips) across screenlines
and analysis to lead directly into a * Reduced incidence of accidents_________________________ ________ - d targeted remedial program and fatalities
Develop public transport as a viable * Support reform of public transport * Operating costs as % of revenueand sustainable alternative to private sector organization, management * Mode share (across screenlines)car use and finances * Average bus operating speeds
* Improve quality and efficiency of (see above)public transport services
Protect and improve the environment * Develop local monitoring and * Pass/fail rate for vehicleanalysis capacity emissions inspections
* Implement motor vehicle * Proportion of fleet testedemission control program * Landscaped area
* Plant "greenways" adjacent totransport facilities
Strengthen local institutional capacity * Strengthen local planning, design, * Development and implementationand integration within the urban implementation, management and of policies, plans and programstransport sector maintenance capabilities
* Establish high-level coordinated________________ regul atory/management capacity
B. Strategic Context1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex 1)Document number: R98-107 Date of latest CAS discussion: 05/28/98
China: Country Assistance StrategyFull Report, 16321-CHA, February 27, 1997Progress Report, R98-107, May 6, 1998
The CAS aims to reduce infrastructure bottlenecks, while focusing investment in inland areas. Urumqi isthe capital city of the inland Xinjiang Uygur Autonomous Region (XUAR). The project addresses rapid
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urban development challenges by promoting a cost-effective and environmentally balanced framework forurban transport development. The project will add needed urban transport infrastructure, promote saferand more efficient use of existing road capacity via area traffic management and improved public transport,and ameliorate the environment through vehicle emissions control and landscaping programs. In addition,the project will strengthen the capacity of local institutions to better manage the sector.
2. Main sector issues and Government strategy:
Sector Issues
The main issues facing China's urban transport sector stem from the pace of urbanization (from 30.2% ofthe population in 1995 to 49.1% by 2020)/I, combined with the anticipated motorization rate assummarized below (from an average of 10 cars per 1000 residents in 1995 to 120-130 per 1000 in 2020)/2.
Increasing urban traffic congestion. Urban traffic congestion is jeopardizing the productivity of largecities in China, through increased travel times, higher vehicle operating costs, and a high rate of roadaccidents.
Inadequate facilities for pedestrians and cyclists. The bicycle is the traditional mode of transport inmany medium-sized cities in China. Its role is increasingly threatened by rapid motorization. Currentdesigns for pedestrian facilities favor underpasses, overbridges and other formns of physically separatefacilities that overlook the convenience of pedestrians.
Poor management and maintenance of urban roads. Traffic management experience is limited in mostcities. Measures that would improve traffic flow, reduce conflicts between road users, protect pedestriansand cyclists and give needed priority to buses are generally lacking. Responsibility for various aspects oftraffic management remains fragmented among various institutions.
Increasing numbers and severity of road accidents. Due to poor driver behavior and poor road sense ofpedestrians, traffic accidents are increasing. More objective assessment of the causes of accidents ishampered by lack of adequate data collection and analysis techniques.
Inadequate supply of roadspace. The road network density in China's cities is typically lower than thatfound in cities with comparable population densities elsewhere. As intemational experience attests, in theabsence of a balanced transport policy the supply of new capacity quickly succumbs to motorization.Simply increasing road capacity will not solve the problem; measures to enhance the efficient use of roadspace and to manage motorized travel demand are also needed.
Inadequate public transport services. Public transport, a potentially more efficient mode in terms ofpassenger carrying capacity, is hindered by slow operating speeds, outdated operating practices, oldvehicles, and inefficient management. Service provision by private operators is constrained by inadequateregulatory arrangements, un-economic fare levels, and unclear subsidy policies.
Increasing air pollution. Vehicle emissions are posing serious health threats to the urban population,although lead-free fuel is being introduced nationally to reduce the impacts.
I/United Nations, World Urbanization Prospects: The 1996 Revision, New York. 1998.2/ Stares and Zhi, China's Urban Transport Development Strategy: Proceedings of a Symposium in Beiiing. November 8-10.1995, World Bank Discussion Paper No. 352, Washington, D.C., 1996.
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Institutional weaknesses. In most Chinese cities there are multiple agencies responsible for urbantransport policy, planning, regulation, and operations. Coordination between these agencies remainsinadequate. There is generally no single agency for the formulation and implementation of urban transportpolicy, programs and budgets.
Government Strategy
In late 1995, broad policies and actions for the urban transport sector were identified at a nationalsymposium (sponsored by the Ministry of Construction, Ministry of Finance, the People's Bank of China,the World Bank and the Asian Development Bank/3), (see Annex 1). The project builds on these, inconjunction with the World Bank Country Assistance Strategy for China and local development plans.
3. Sector issues to be addressed by the project and strategic choices:
Sector issues to be addressed by the project
Urbanization. Urumqi Municipality is the political, economic and cultural hub of the XUAR. With a totalpopulation of 1.89 million residents (of whom 1.59 million are registered permanent and 0.3 million are"floating" or non-resident population), the formal population of the Urumqi Municipality accounts for 8.8%of the population of XUAR, but contributes 21% to its Gross Regional Product. Minority populationsaccount for 27.3% of the Urumqi Municipality, with 12.7% Uygur, 9.5% Hui, 3.2% Kazak, and theremainder being Man, Mongol, Xibe, Russ and Uzbek.
Projections of economic and population growth for Urumqi over the next 20 years have been made byUrumqi Municipal Government (UMG) planners as a step in the updating of the 1985 Master Plan for themunicipality. These suggest that by 2020, Urumnqi is expected to have a population of 2.27 million. Theseprojections were reviewed during project preparation, and provide a reasonable basis for forecasting traveldemand. Annex 4 presents basic planning data for the project, including data for the study area, an areasmaller than the entire municipality defined for the purposes of travel demand forecasting.
Motorization. Urumqi has seen rapid increases in motor vehicle ownership and use during recent years.By 1997, the motor vehicle fleet totaled 79,100 vehicles, (52 vehicles per 1000 population) of which 54%were trucks and 46% were passenger vehicles (including taxis and minibuses). Based on UMG projectionsof economic and population growth, the motor vehicle fleet is projected to increase to 300,000 vehicles in2020 (132 vehicles per 1000 population). While it is not feasible to reduce the level of motorization, it ispossible to reduce the use of cars, by making altematives, principally walking and public transport, moreattractive. This is the objective of several components of the project.
Travel Demand. Travel demand by all modes is projected to increase by 55% from 1999 to 2020. Most(85%) of the projected increase results from the projected increase in population. The
3/ ibid.
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remainder results from an increase in the number of trips per person, with the expected increase in incomes.General projections of travel demand are presented below with estimates of mode share. Additionalplanning background is presented in Annex 4.
Projections of travel demand1999 2020
Total trips/day 4.17million 6.15million
Average trips/nerson/day 2.74 2.97
Mode Share
Walk 45.3% 37.0%
Cvcle 8.1% 6.05%
Bus 30.1% 31.0%
Taxi 7.9% 11.0%
Car 8.6% 15.0%
Total 100.0% 100.0%
Average motorized trip length 10.9 km. 12.3 km.
Much of the increase in travel demand will be between the existing Central Business District (CBD) area in
the south east of the city and new mixed use development areas in the north west. The project includesseveral components to cater for this projected increase in travel demand in an integrated and sustainablemanner. Together, the road network, traffic management and public transport components are designed toprovide the capacity needed to meet future travel demand. In particular, the public transport component isdesigned to enable buses to at least retain their present market share of travel demand.
Facilities for Pedestrians and Cyclists. Weather conditions (harsh winters and hot summers) andgeography (hilly terrain) do not favor bicycle use in Urumqi. As a result, travel demand for cycle use inUrurnqi is lower-than-average for a Chinese city. Bicycle travel is concentrated in short-distance worktrips in outlying industrial areas. Within the city center, bicycle traffic volumes are low (2%-5% of trips),
resulting in excess capacity on city center non-motorized transport (NMT) facilities. With declining mode
share, daily trips by bicycle will increase by only 10% in the future. However, walk trips will continue tomake up a large share of the total travel demand, increasing by 20%. The project's NMT programtherefore focuses on improvements to pedestrian facilities.
Urban Traffic Congestion. While traffic conditions are not yet severe in Urumqi, there is evidence of
emerging congestion in the CBD and along north-south routes, particularly at junctions. Data collected
from moving car surveys in October 1997 recorded a network peak hour average journey speed of 21.7km/h. Delays account for approximately 35% of total journey times, and are attributed primarily to
waiting time at traffic signals. While Urumqi clearly does not yet experience sustained congestedconditions, traffic flow is nearing capacity with instability at key locations. Without increases in road
capacity, the forecast increases in car and taxi travel demand would result in severe increases in congestionalong key north-south corridors. The ring road component of the project will attract a high proportion oftrips from the CBD area. As a result, speeds within the area of the Ring Road are forecast to increase toabout 28 km/h.
Traffic Management. Existing traffic management concentrates on physically segregating pedestrians and
vehicles by barriers and grade-separation, vehicle bans and a limited number of uncoordinated trafficsignals. Road user behavior and the road sense of drivers and pedestrians is poor, despite road usereducation campaigns. The result is an inefficient use of roadspace. The project provides complementary
packages of measures to increase network productivity, including traffic signals and Area Traffic Control
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(ATC), junction channelization, bus priority, and institutional strengthening.
Road Safety. The incidence and severity of accidents in Urumqi appears uncommonly high compared withother cities of similar population and motorization within China. In 1997 there were 222 fatalities permillion population. A more objective assessment of numbers of road accidents and design of targetedremedial measures will be possible with the computer based data collection and analysis techniquesproposed in the project.
Road Maintenance. The extremes of hot dry summers and cold snowy winters pose specific problems forroad maintenance units. Between November and March no periodic maintenance can be carried out, onlysnow clearing. Maintenance work programs are labor intensive and based on engineering judgment as thereis no maintenance management system or equipment to measure road condition. Since there is no localprogram budgeting system, there is no mechanism to provide for maintenance expenses on a long-termbasis. The project supports local goals to modemize maintenance methods and planning systems and willprovide technical assistance to review sector organization and finance.
Road Network. Urumqi's road network is essentially a NW-SE linear grid, with a limited accessexpressway forming a central spine. It is constrained in the south by an 800 meter gap between two hills. Itis deficient in providing capacity for N-S cross town movements, and protecting the established CBD fromcongestion. Without additional major investment in new capacity (to be provided by the project), the city'sattractiveness to commercial development will be reduced. This in tum will be detrimental to the city'seconomic growth and its ability to increase the living standards of its population.
Public Transport. If public transport is to retain or increase its share of demand, the financial constraintson the main supplier (Urumqi Public Transport Company (UPTC) with 1,831 buses) need to be reducedand operational strategies need to be clarified and more forcefully implemented. UPTC's mainshortcomings of overcrowding, poor geographic coverage of routes and low quality of service to usersresult from a severe financial constraint. These derive from the combination of a low-priced fare structuremandated by the XUAR, a capped-level of subsidy provided by UMG, and an inability (due to nationalregulations) to shed surplus labor. Its ability to implement other operating efficiencies are hampered by alack of computer based tools and information systems. If these constraints were lifted, UPTC would bebetter placed to acquire new buses, provide extra capacity, and improve and expand services, while at thesamne time reducing its operating costs and approaching financial viability. An attempt to overcome theconsequences to users of its deficiencies came from permitting the operation of competing, mostly private,minibuses. These have higher fares and lower costs and their operations are commercially viable. But thelack of a clear policy framework for the role of minibuses now results in large numbers of them operatingon UPTC's most profitable routes, giving rise to minibus-induced traffic congestion, which detracts furtherfrom UPTC's operational efficiency while reducing its revenues.
The project includes technical assistance and some investment to improve the operating efficiency ofUPTC, to provide bus priority on-street over other traffic, to review the role of minibuses, and tostrengthen the regulatory framework.
Air Pollution. Industrial activity is presently the main contributor to poor ambient air quality in Urumqi,especially in the winter months. Motor vehicles are the main source of pollution in summer. Increasingmotorization and traffic congestion will significantly increase the contribution of mobile source pollution.As part of a national pilot program in 10 cities, Urumqi has undertaken conversion of 1,500 buses fromgasoline to compressed natural gas (CNG). The taxi fleet is being converted to liquefied petroleum gas(LPG). National and local laws and regulations to govern emissions are under development. The project
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will support further development of the local initiatives and identify other appropriate actions to address airpollution from motor vehicles as part of the Motor Vehicle Emission Control Strategy (MVECS).
Institutions. The institutional arrangements for the planning, design and management of urban transportinfrastructure and services in Urumqi are similar to other cities in China. Responsibility for urbantransport is distributed across a wide array of institutions, with limited coordination across agencies. Localtechnical capacity is limited and unevenly distributed between agencies. Institutional reform anddevelopment is proposed within the project to improve the coordinated formulation and implementation oftransport policy, planning, and budgeting, and the regulation and imnplementation of transport services andfacilities.
Strategic Choices
During the project preparation phase, the UMG leadership and transport agencies made several strategicchoices to address the above sector issues.
Road capacity. The need to invest in the expansion of road capacity, particularly in a ring road, wasexamined in depth given that the North-South Hetan expressway was recently built. The analysis showedthat extra capacity is required but a full ring road with standards as originally proposed could not bejustified, particularly in the NE quadrant. A lower-capacity partial ring-road (together with complementarylimited improvements to the arterial road network) is supported on the basis of an economic analysis.
Public transport. Given the high levels of existing and projected future public transport use, high prioritywas attached to improving the quantity, quality and efficiency of bus services. As the public sectoroperator is already raising some capital for buses from local financial institutions, investment in buses anddepots was considered unnecessary.
The project also considered the extent of reforms which was feasible in the public transport sector. TheUPTC is not an independent business entity, hence the planned reforms aim at commercialization of itsmanagement and operations. Current financial and regulatory arrangements make the operation of publictransport in Urumqi unsustainable. Both UMG and XUAR have agreed to address this issue though aPublic Service Obligation (PSO) payment, based on level of service requirements and route coverage, aswell as further commercialization of the UPTC. They have also agreed to create a new regulatory agencyfor public transport separate from UPTC. The project supports these initiatives. An annual review ofimplementation of the reform program, including possible modifications to the program itself and itstargets was agreed at negotiations.
Investments in light rail and busways were found unjustifiable. However, it was agreed that possible futureinvestment will be examined in the proposed Network Development Study.
Traffic management. The project team evaluated the timing and extent of institutional development andtraining prior to any major investments. It was agreed that knowledge transfer and institutionalstrengthening would be best achieved with training and investment taking place in parallel.
Environmental Management. Direct environmental impacts of motor vehicles will be mitigated throughmeasures incorporated in the Environmental Management Plan (EMP). However, this plan only deals withthe local visual intrusion, noise and air pollution from motor vehicles. City wide mitigation of air pollutionfrom motor vehicles would require a comprehensive stand alone project with actions to be undertaken atnational and local levels. Therefore, a choice was made regarding the scope of activities to be included
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under the project. An outline MVECS, building on the ongoing city initiatives, was prepared as part of theEMP. The project supports the implementation of Stage 2 of this Strategy. A Bank/UMG annual reviewof the MVECS was agreed at negotiations.
C. Project Description Summary
1. Project components (see Annex 2 for a detailed description and Annex 3 for a detailed costbreakdown):
A. Road Network Development. To maintain and improve the road network, this component willprovide a 31.25 km "Ring Road", 29 km. of which is financed under the project. The proposed road willlink the old CBD to new development areas of the city, protect the CBD from extraneous traffic, anddistribute regional traffic to the urban trunk road network (see Annex 4 for traffic projections).
B. Traffic Management and Road Safety. This component is designed to enhance the efficiency inthe use of the existing road space and improve traffic safety. It contains five programns focusing oninvestment and technical assistance.
C. Public Transport. This component is designed to develop public transport as a viable andsustainable travel alternative to the car by improving the level of existing bus services, and to support theongoing reforms towards the strengthening of the regulatory and planning capabilities of the UrbanConstruction Commission (UCC), and the comrnercial viability of UPTC.
D. Environmental Management. Urumqi's leadership is very active in promoting and implementingenvironmental protection and improvement initiatives. This component is designed to support them andfuirther develop a MVECS.
E. Institutional Development. This component is designed to strengthen local capacity andprocesses for urban transport, planning, programming and budgeting, and system management.
Indicative Bankhh % ofConiponent Sector Coss % Of 1140l, B00*,ank-a
A. Road Network Development Urban Transport 222.60 82.4 84.00 84.0B. Traffic Management and Urban Transport 11.80 4.4 7.00 7.0Road SafetyC. Public Transport Urban Transport 7.50 2.8 3.60 3.6D. Environmental Management Urban Transport 4.60 1.7 2.50 2.5E. histitutional Development Urban Transport 3.50 1.3 1.90 1.9
Total Project Costs 250.00 92.6 99.00 99.0Interest during construction 19.00 7.0 0.00 0.0
Front-end fee 1.00 0.4 1.00 1.0Total Financing Required 270.00 100.0 100.00 100.0
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2. Key policy and institutional reforms supported by the project:
Key policy and institutional reforms to be sought include:
2.1 Strengthened coordination of municipal urban transport sector policies and programs: AnUrban Transport Sector Leading group has been established by the UMG. The Sector Leading Group will
be maintained as the decision making body for policy making, medium-term planning and development of
rolling investment programs. This group shall oversee all project studies and be supported by a permanent
group of technical experts.
2.2 Measurable progress on a strategy for public transport reform: This entails further
commercialization of UPTC, transferring the regulatory functions of UPTC to a separate office of the
UCC, and development of a policy framework to provide for sustainable finance for public transport
development. UMG's policy statement on the reform and development of public transport (approved
January 2000), serves as a basis for the strategy. Progress on the implementation of the strategy, together
with performance targets, will be monitored via annual review between UMG and the Bank.
2.3 Continued progress on implementation of a MVECS: Under the project, UMG will establish a
division of the Urumqi Environment Protection Bureau (UJEPB) that will be responsible for the
management of the implementation of the MVECS in Urumqi. The division will coordinate existing
programs, develop and monitor performance measures for the MVECS, and develop implementation plans.
The division will assess the current emission targets and assess the need to modify the MVECS. The
assessment and recommendations will be contained in the annual report to the municipal government, which
will serve as the basis for the annual BankIUMG review.
2.4 Development and implementation of a systematic road maintenance management system: The
computerized road maintenance management system (covering pavement, bridges and drainage) will
provide the basis for needs-based planning and budgeting. Budget targets for road maintenance will be
discussed during the annual UMG/Bank review of the project.
3. Benefits and target population:
Successful implementation of the project will generate immediate and longer-term benefits to the residents
and enterprises of Urumqi. Benefits flow from the improved operation of the urban transport system and
the longer-term economic development this facilitates. Particular benefits expected and their target
populations are summarized in the following table:
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Summary of Benefits by Objective
Objective/Strategy v Direct Benefit | Secondary BenefitA. Develop and manage the urban road network to support land use, transport and economic development plans
* Develop high-capacity * Passenger and freight road users will realize * Regional and local businesses will benefit from a)cross-town road network travel time and vehicle operating cost savings improved freight access and b) improved access for
* Improve network from network Lmprovements. employees and patrons to commercial andconnectivity of * In particular, management of new capacity employment areas.lower-class roads will allow bus speeds to be maintained in key * Over time, the city of Urumqi and/or other land
* Strengthen road North-South corridors and CBD as general owners may benefit from the capitalization of travelmaintenance traffic levels increase. time savings in land values.
* With improvel road maintenance * Over time, a more systematic road maintenancemanagement system, users will benefit from program should result in reduced expenditure needimproved road network conditions. for asset management.
B. Increase safety and efficiency of the road network* Implement * Improved traffic management increases * Safe and attractive pedestrian facilities ensure
comprehensive traffic effective capacity of roadspace to the benefit broad eqwty of project benefits (since use of allmanagement, including of road users and adjacent land uses modes involves walking)bus priority measures. * Safe use of road infrastructure and services * Improved accident data collection and analysis
* Conduct road user will lead to personal and economic benefits leads to more systematic analysis of accidents andeducation by preventing or reducing the severity of targeted remedial programs.
* Improve accident data accidents (fatalities, injuries, other accident * Well managed road space contributes to urbancollection and analysis costs, e.g. productivity losses) amenity and livability.
C. Develop public transpo as a viable and sustainable alternative to rivate car use* Improve quality and * Improved maintenance and appearance will Maintaining high public transport mode shares generates
efficiency of existing result in lower operating costs. many other benefits for the city of Urumqi and itspublic transport services * Improvements to bus operations and facilities residents including:
* Deepen reform of public will strengthen image for public transport * increased energy efficiency;transport sector and on-street performance, including time * deferred need for new road investment;organization and savings and accessibility for passengers. * more equitable distribution of benefits, given thefinances * Continued commercialization and high levels of public transport use amongst
cost-recovery of sector reduces need for potentially vulnerable residents (minorities, poor,government-sponsored operating subsidies, women and transient).permitting further capital investment. * increased attractiveness to private operators with
potential related financial, economic andemployment benefits.
D. Environmental protecti n and improvement* Develop monitoring and * Increased local knowledge of and capabilities * Urumqi population will realize health benefits from
analysis capacity in emissions management will inform the research and management of emissions through* Implement motor decision-making on environment and regulation, market pricing and/or technological
vehicle emissions motorization policies. specifications.control strategy * Landscaped areas mitigate noise impacts to
* Plant "greenways" sensitive receptors and improve theadjacent to transport environmental quality of the city.facilities .
E. Strengthen local institut ional capacity and integration within urban transport sector* Strengthen local * Strengthened institutions and increased local * The development of local technical capacity and
planning capabilities capabilities in transportation planning will coordinating mechanisms will benefit Ununqi* Establish high-level inform decision-making on urban transport society - and China - through the development and
coordination for sector sector and grovvth management policies, implementation of economically sound policies,regulation' management plans and investment programs.
4. Institutional and implementation arrangements:
Project Oversight
An Urumqi Municipal Government Project Leading Group (consisting of the heads of implementingagencies and headed by a vice-mayor) with responsibility for overall project coordination (during bothpreparation and implementation) was established at the start of project preparation. Currently, the Mayorand a Vice Mayor are overseeing project preparation. The UMG Leading Group will coordinate with aProvincial Project Leading Group (consisting of leaders of concerned provincial agencies and headed by the
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XUAR deputy chairnan) which has been established to coordinate project matters among national, regionaland municipal governments. An Urban Transport Sector Leading Group has been established to formulatepolicy, undertake planning and guide implementation of urban transport activities for the city, includingtraffic management policies and operations. This group will oversee all studies.
Project Implementation
UMG will be responsible for project implementation, counterpart funds arrangement, loan repayment, andensuring compliance with World Bank policies. UMG will sign the Project Agreement with the WorldBank. The estimated completion date of the project is June 30, 2005, with a projected closing date ofDecember 31, 2005.
Project Management
The already established Project Executive Office (PEO), reporting to the UMG Project Leading Group, hasoverall responsibility for project management and coordination with respect to implementation. The PEOwill be responsible for coordinating the procurement activities for all components. The PEO will beresponsible for day-to-day management of TA and other activities included in the InstitutionalStrengthening Component.
Implementing agencies are:* Urumqi Municipal Ring Road Construction Company which will directly manage the
implementation of the Ring Road construction (component Al).* Urumqi Municipal Engineering Bureau (UMEB) will be responsible for other road network
and road maintenance sub-components A2 & A3.* Urumqi Public Security Bureau (UPSB) will be the project manager for the implementation of
the traffic management component B.* UPTC will implement, together with the Urumqi Passenger Transport Management Office, the
institutional reform and the investment program for sub-component C I. UPTC will worktogether with UPSB and PEO for the bus network improvement sub component C2. The PEOwill manage the TA for sub-component C3 on behalf of UMG.
* IJEPB will be responsible for the environmental improvement component D andimplementation of the environmental protection measures identified in the EMP.
* Urumqi Planning Bureau (UPB) transportation planning and modeling sub-unit will participatein the Transport Network Development Program Study in sub-component El.
* District Resettlement Offices will have the responsibility for implementation of resettlement inaccordance with the Resettlement Action Plan (RAP) under the guidance of and with fundingarranged by the PEO.
Finance. The Ministry of Finance (MOF) will on-lend World Bank loan fimds to the XUAR (through theFinance Bureau), which will in turn on-lend funds to Urumqi Municipality. The loan type will beLIBOR-based floating rate Single Currency (US$) Loan (SCL). On-lending terms from MOF to XUARand from XUAR to UMG will be the same as the World Bank's to the Borrower. The 1% front-end fee willbe financed from the loan. Civil works were initiated in the second quarter of 2000 which will beretro-actively financed by the loan in the amount of $9 million.
Financial Management and Disbursement. The financial management aspects of the Project are to behandled by the PEO and Regional Finance Bureau (RFB). The RFB's Finance Division will be responsiblefor the monitoring, maintenance and reconciliation of the Special Account, checking and monitoring
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withdrawal applications, and verifying that payment requests meet World Bank requirements. TheFinancial Department of the PEO (FDPEO), has been set up and will report both to the Directors of thePEO and the Municipal Finance Bureau (MFB). The FDPEO will be responsible for collecting all thesupporting documents, monitoring contract payments, and preparing payment requests before submitting tothe RFB. The RFB will further verify, approve and process these documents before submitting to the Bankfor disbursement.
In terms of disbursement technique, the project will be utilizing traditional disbursement techniques asopposed to using the Project Management Report (PMR)-based disbursement system.
Procurement. The Procurement Division of the PEO will have overall responsibility for procurement,while the Project Management Division will be responsible for subsequent contract management.Implementing agencies will participate in procurement under the guidance, coordination and supervision ofthe PEO.
The use of a procurement agent (tendering company) is mandatory for all International CompetitiveBidding (ICB) contracts in the Bank financed China lending program, according to governmentrequirements. One of the state-approved and controlled International Tendering Companies (ITC) who arecertified by the Ministry Of Foreign Trade and Economic Cooperation (MOFTEC) as being proficient ininternational procurement, has to be retained as the procurement agent for all aspects of bidding for civilworks, electrical and mechanical equipment under ICB procedures. CMC has been appointed as the ITCfor the project.
The Project Implementation Plan (PIP). The PEO and all implementing agencies jointly prepared thePIP. It will be used as a working document to guide the implementation of the project. A copy of the draftPIP is available in the Project File. An updated PIP will be prepared at the Project Launch Workshop.
Progress Reporting and Annual Review. The PEO will be responsible for preparing quarterly andannual progress reports and annual work programs based on the PIP. The progress reports will summarizephysical and financial progress, address major problems and propose corrective actions to be taken. Theannual progress report will review the progress achieved in the preceding year, revise the annual workprogram (AWP) for the following year, and confirm the availability of counterpart funds. The AWP willbe the subject of a joint Bank/UMG review.
World Bank Supervision Arrangements. The Project has been prepared by a joint Beijing andWashington based team led from Washington. The same team will supervise the project. It is anticipatedthat there will be three supervision missions a year led from the Beijing office. The fourth mission eachyear will be the annual review mission led from Washington.
D. Project Rationale
1. Project alternatives considered and reasons for rejection:
Alternatives considered related to the scope and design of the five components listed in section B.
Road network Prior to project identification, the PEO solicited alternative design concepts from sevendomestic design institutes, which together developed 24 alternatives for the proposed Ring Road. Duringproject preparation, the Bank team and the PEO considered alternatives to the Ring Road for the provisionof primary road capacity, as well as alternative alignments (shown on Map 30808R) and design standards
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for the Ring Road, and alternate junction locations and types. A number of these alternatives were testedand costed. Based on traffic projections and costs the solution chosen fulfills the project objective mostcost effectively.
Traffic management. As originally proposed by UPSB this component included a major investment in aClosed Circuit Television (CCTV) Monitoring System and Command Center. Though CCTV monitoringassists the operation of an ATC scheme, the amount proposed for Urumqi was not cost-effective. In itsplace, UPSB were encouraged to develop a broader program of traffic management engineering measureswhich will have a greater and more direct benefit in reducing traffic congestion.
Public transport. Altematives considered included investment in vehicles, in a new bus depot, and moreextensive bus priority measures, including a possible busway. There is a need for more buses to meetmarket demand. However, as UPTC is already obtaining finance for some vehicles from local banks, thereappeared little justification for inclusion of these in the project. The depot was intended for the creation of afifth bus company under the umbrella of UPTC. The Project considered financing a depot if it could serveas a pilot for a company operating on strictly commercial basis. However, such a reforrned companyshould also be capable of obtaining a commercial loan for the depot. Therefore, the Project focused oncreating the framework for financially sustainable services. UPTC were guided to focus on improvingoperating efficiency and service levels of the existing companies. UMG were encouraged to examinesustainable fare, PSO and regulatory arrangements.
At the present time, bus delays due to traffic congestion occur at isolated locations and corridors. There islittle justification for an extensive network of bus lanes or a busway on the main NW-SE axis of traveldemand. To prevent a future decline in bus operating speeds with increasing traffic levels, the projectincludes a pilot for bus priority measures and a feasibility study for a bus priority network.
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2. Major related projects financed by the Bank and/or other development agencies (completed,ongoing and planned).
Latest SupervisionSector Issue Project (PSR) Ratings
l______________________________ _________________________ (Bank-financed projects only)Implementation Development
Bank-financed Progress (IP) Objective (DO)Infrastructure Development Xinjiang Highway Project S S
(ongoing)
Infrastructure Development Second Xinjiang Highway S SProject (ongoing)
Shanghai Metropolitan S SUrban Transport Transport Project I (completed)
Shanghai Metropolitan S SUrban Transport Transport Project II (ongoing)
Guangzhou City Center S SUrban Transport Transport Project (ongoing)
Liaoning Urban Transport S SUrban Transport Project (ongoing)
Urban Transport Shijiazhuang Urban TransportProject (under preparation)
Other development agenciesGovenmment of Switzerland Coordinated Transport and
Land Use Development(Kunming)
Government of Japan (JBIC) Light Rail Transit (Wuhan) |
IP/DO Ratings: HS (Highly Satisfactory), S (Satisfactory), U (Unsatisfactory), HU (Highly Unsatisfactory)
3. Lessons learned and reflected in the project design:
The Bank has financed four urban transport projects in China: Shanghai (two projects), Guangzhou, andLiaoning. The main lesson from these projects is that participation of all agencies with responsibilities forurban transport is key to developing a balanced, integrated and sustainable project. Of particularimportance is the need to include agencies not involved with road construction.
A sustainable solution needs more than a ring road. Due to the strong preference for major investmentin road infrastructure in these cities, the Bank team discussed in depth the value of complementing the RingRoad investment with traffic management, improved public transport, and pedestrian facilities. UMGrecognized the lessons of past Bank projects in China and agreed to use this knowledge to develop the
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project.
Good communication is vital. Key lessons in improving communication of ideas, knowledge andexperience are the benefits of mounting a team comprising Beijing office staff, technical specialists whospeak Chinese, and technical specialists with experience in China.
Integration of land use and transport is essential for network design. There is a need to check thequality of the Master Plan, particularly whether the growth forecasts have an analytical base, whether thereis adequate integration between the land use plan and the road network, and whether the road networkdesign adequately reflects future travel demand. Experience also underlines the need to develop trafficforecasts based on robust assumptions of future growth so that alternative designs can be adequatelyreviewed. The approach of considering options and iteratively improving designs is still new to China.
Recognize and address the institutional gap into which traffic management falls. Design andengineering aspects are beyond the experience of the traffic police but are too small scale for localmunicipal engineers. The project aims to strengthen traffic management design capability in the trafficpolice and to link it to the design and implementation of the ATC system. The other key lesson is that timelapse between design and implementation of traffic management measures should be kept short due to rapidchanges in traffic flow conditions.
Pace of reform is governed by local agencies and national political conditions. Urban public transportexperience favors assistance with the formulation and implementation of reform. Wholesale privatization ofcompanies, cost based competitive tendering for service supply, reducing labor surplus to benchmarkedoperational requirements, and major private sector participation are not politically acceptable at the presenttime. Thus provision of public transport continues to be largely a public sector activity. The initial thrusttherefore should be to make public sector activity more efficient through the separation ofregulatory/service planning functions from the supply function in the State Owned Enterprise (SOE) buscompanies, the commercialization and corporatization of operating SOE companies, the development of theregulatory agencies in govermment, and facilitating private sector participation to the extent possible. Thissupport draws not just on experience in China, but also in countries of the Former Soviet Union (FSU) andmore generally in the industry. The key is to adapt this knowledge to local conditions.
4. Indications of borrower commitment and ownership:
The various implementing agencies in the project are new to the Bank, and in some cases, to the sector.Project preparation started in eamest only in May 1998. The basic ideas for all sub-components weregenerated by the Borrower's agencies and refined with advice from the Borrower's consultants and the Bankteam. Throughout project preparation, the PEO and other agencies have been extremely cooperative andhave sought and taken advice from the Bank team on technical matters of project design. Staff from theseagencies have also visited other cities in China with current Bank projects. Two senior members of UMGand the Vice Director (Technical) of the PEO actively participated in a 10 day training program on urbantransport in Paris organized jointly by the World Bank and the French Government in September 1999.
UMG has taken all necessary steps to ensure that initial construction can begin at the start of the project.
5. Value added of Bank support in this project:
The Bank's value-added to the project is provided in the form of integrated technical knowledge and policyadvice in all aspects of urban transport, and the transfer of worldwide technical good practice in projectdesign and implementation. The project will build on the Bank's experience from the five other urban
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transport projects in China. The UMG team has greatly benefited from this knowledge transfer duringproject preparation.
The Bank support has resulted in broadening the scope of the project, the development of inter-agencyteams for component design, and the integration of transport planning into the Master Plan process. UMGhas agreed to create new institutions that will ensure inter-agency policy and planning coordination. Theproject will support the strengthening of these institutions.
E. Summary Project Analysis (Detailed assessments are in the project file, see Annex 8)
1. Economic (see Annex 4):* Cost benefit NPV=US$179.4 million; ERR = 20.2 % (see Annex 4)* Cost effectivenesso Other (specify)Traditional cost-benefit analysis (CBA) was used to evaluate the major investment in the project in theRing Road. Simplified CBA was used to evaluate specific investment items in the Traffic Management andPublic Transport Components.
2. Financial (see Annex 4 and Annex 5):NPV=US$ million; FRR = % (see Annex 4)The financial analysis covered three aspects:
(1) fiscal impact and counterpart funding arrangements,(2) user charges and expenditures for road maintenance and public transport, and(3) financial management system (see Annex 13).
Fiscal Impact:
2.1 Fiscal Impact and Counterpart Funding Arrangements:
UMG resources between 1999 and 2004 were found to adequately cover counterpart funds forimplementation, and debt service costs thereafter. Counterpart funds required peak at 18.6% of effectivefiscal capacity in 2002. Table I of Annex 5 shows a summary of the fiscal capacity analyses.
In 1999, the UMG established a World Bank loan repayment fund using two sources: budget for new roadinvestment and the housing budget. In the next four years, budget allocations for new road investment willbe the main source of the counterpart funds. Because of the government's housing reform policy, UMGwill no longer provide housing to employees starting in 2000. Thus, half of the budget previously allocatedto housing will be transferred to the counterpart funds for the project. The revenue sources for thesebudgetary expenditures have been reviewed in detail and are discussed below and summarized in Table 2 ofAnnex 5.
2.2 Road User Charges:
Road user charges are collected by different levels of government. The main municipal user charges aretaxi and minibus license bidding fees (from tendering of operating rights) and annual vehicle license fees.The national governnent collects fuel taxes.
Public Transport Funding. UMG currently provides UPTC funding for capital investment (includingsome bus purchases), and operating subsidies. Cost recovery (excluding subsidies) on the operating
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account (including depreciation, but excluding interest charges on UMG capital investment) is currentlyaround 90%. UMG plans to phase out the operating subsidies over time. The timing of the phase out ofsubsidies and the amount of funding required in the future for capital investment are dependent on thereform efforts to be supported by component C of the project. The public transport sector studies insub-components Cl, C2 (a) and C3 (a) will permit more detailed financial estimates to be made of UPTCfuture requirements. Actual budget allocations based on these estimates will be the subject of discussionduring the annual reviews of the implementation of the public transport sector strategy.
Road Maintenance. Current funding from UMG budgets for road maintenance is less than expenditurewith the balance made up from ad hoc urban construction funding and commercial activities of the roadmaintenance units. With the present methods of maintenance planning and programming, it is not possibleto make meaningful estimates of the future funding requirements. The project will develop a more rationaland sustainable approach to road maintenance operations and budgeting (sub-component A3). The annualreview of road maintenance will permit the Bank to influence future budgets. Further analysis of roadmaintenance methods, budgets and expenditures is provided in Annex 16.
3. Technical:
A thorough technical review of each component was carried out by the project team. Detailed summariesare provided in Annex 16. Overall, the analysis showed that the quality of the technical work has beenadequate, in line with experience in other cities. A detailed engineering design review of the year 1 RingRoad civil works contracts has confirmed the adopted design approach and standards. Costs are based onthird quarter 1999 prices, with physical contingencies at 10% of the base cost of civil works.
4. Institutional:
4.1 Executing agencies:
While the implementing agencies generally have adequate technical capability for basic activities, most willrequire support or training to undertake and implement the results of the technical studies proposed. As aresult, each component includes Technical Assistance (TA) elements. The interagency cooperation initiatedduring project preparation will also need to be continued through implementation. Longer term proceduresand regulations for inter-agency coordination, expert review and policy formulation will be prepared duringproject implementation.
4.2 Project management:
The PEO which has successfully managed project preparation is being expanded to manage projectimplementation. Provision is made in the project for TA support and training to the PEO for its expandedrole. UMG agencies have had limited exposure to construction supervision associated with Bank-fundedcivil works contracts. International consultant services are included to support domestic consultants in thistask.
4.3 Procurement issues:
A procurement assessment was performed during project preparation, a summary of which is presented inAnnex 6. The procurement agency is the PEO. An ITC has been appointed by the PEO to handle thecommercial aspects of ICB. With the assistance of the ITC, the PEO is expected to fulfill its procurementfunction and administer procurement in an efficient and transparent way over time. The risks in theprocurement process are considered average.
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In the regulations and administrative procedures issued by the central and local governments for NationalCompetitive Bidding (NCB) using local funds, there are some inconsistencies with Bank requirements. Themain inconsistencies are the use of bracketing and the merit point system in prequalification, bid evaluationand contract award for locally funded NCB civil works contracts. They will be waived in favor of BankNCB procedures in a supplemental letter to the Loan Agreement, further details of which are provided inAnnex 6.
4.4 Financial management issues:
A review of the adequacy of the project financial management system was performed during projectpreparation. The review concluded that this project meets minimum Bank financial managementrequirements. Some training of PEO and implementing agencies staff is needed which will be given atproject launch. Annex 13 contains an edited version of the Review of the Financial Management System(FMS).
The status of the Borrower's and the XUAR compliance with audit covenants in existing Bank-financedprojects is satisfactory. No outstanding audits or audit issues exist with any of the prior projects involvingthe Regional Finance Bureau of XUAR.
5. Environmental: Environmental Category: A (Full Assessment)5.1 Summarize the steps undertaken for environmental assessment and EMP preparation (includingconsultation and disclosture) and the significant issues and their treatment emerging from this analysis.
The project complies with the requirements of O.D. 4.01. The project is classified category A since itinvolves involuntary resettlement, major road construction (partly on new alignment), and increased airpollution and noise, particularly adjacent to the Ring Road.
The Xinjiang Environmental Techniques and Assessment Center (XETAC), part of the XinjiangEnvironmental Monitoring Center (XEMC), was engaged by the PEO in mid 1998 to undertake theEnvironmental Assessment (EA) and to prepare the EAP (Environmental Action Plan) and EA SummaryReport. International consultants funded under the Canadian Intemational Development Agency (CIDA)offered technical assistance in preparing the EA, EAP and EA Summnary. The international consultantsensured that these documents provided an independent technical assessment.
Surveys of ambient air quality were made during the non-heating season in October 1998 and the heatingseason in January 1999. A first round of public consultation took place during the period August 1998 toJune 1999, and a second round between June and September 1999. The second round of consultationswere based on a preliminary draft EA Summary Report in Chinese and Uygur (Uygur being the languageof the largest ethnic minority and the second official language in this Uygur Autonomous Region). Detailsof the consultation process are described in section 5.4 below. The main concems of the public related torelocation and resettlement (including one mosque), noise, local pedestrian and vehicular access, andsurface runoff. Resettlement concerns were addressed by design changes to the Ring Road and in theResettlement Action Plan (RAP). Four alternative sites were offered for a new mosque, to be constructedbefore demolition of the existing mosque. A site for a new mosque, to be constructed before demolition ofthe existing mosque, has been agreed. Noise barriers and sound absorbent pavement are included in civilworks contracts to reduce noise, with double glazing and mechanical ventilation for the properties adjacentto the road. Storm water sewers are included in the project to handle run off.
The State Environmental Protection Agency (SEPA) reviewed and approved the Chinese language versionof the draft lEA in September 1999. Draft English versions of the reports were submitted to the Bank in
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October 1999, and final versions in December 1999. The final EA Summary Report (and the RAPSummary Report) were made available to the public in Chinese and Uygur in early September 1999. Thefinal versions of the EA, EAP and EA Summary documents in Chinese and the EA Summary Report inUygur were made available in the Urumqi Public Library on December 5, 1999. A corresponding fall setof EA, EAP and EA Summary documents in English was sent to the World Bank Public InformationCenter (PIC) in Washington, D.C. with-authorization from UMG, on December 29, 1999. The appraisalmission confirned the availability of the EA in Chinese and EA Summary in Chinese and Uygur inUrumqi. A summary of the assessment is presented in Annex 11.
5.2 What are the main features of the EMP and are they adequate?
Separate mitigation measures are proposed for the design, construction and operation phases of theproject.
Design Phase
Noise, vibration, sunshine and severance were all considered in the design phase of the project. Mitigationmeasures proposed are set out in Annex 11. Planting on an area equivalent to 15% of the land area of theRing Road is included as a mitigation measure. Additional planting on a similar sized area is included inProject Component D: Environmental Management.
Construction Phase
Mitigation measures for air and water quality, vibration, noise and construction materials are included inthe civil works construction contracts. Proposals for traffic management (including facilities forpedestrians) during construction will be developed by the PEO before award of contracts. The contractsrequire the contractors to design and implement detailed measures in consultation with the traffic police andthe construction supervision consultants.
Operation Phase
Air Quality. The MVECS included in Component D of the project is designed to provide city-wide longerterm mitigation measures for air pollution from motor vehicles. It was agreed at negotiations that progressin implementation of the MVECS will be subject to annual review by UMG and the Bank.
The EMP has been approved by SEPA and the Bank and is considered adequate.
5.3 For Category A and B projects, timeline and status of EA:Date of receipt of final draft: December 7, 1999
The EA, EMP and EA Summary were placed in the PIC in Washington, D.C. on December 29, 1999. Theupdated Environmental Data Sheet and updated Project Information Document (PID) were sent to the PICin Washington, D.C. on January 14, 2000. (The PID was first provided to the PIC in Washington, D.C. inNovember 1998).
5.4 How have stakeholders been consulted at the stage of (a) environmental screening and (b) draft EAreport on the environmental impacts and proposed environment management plan? Describe mechanismsof consultation that were used and which groups were consulted?
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First Round of Public Participation (August, 1998 - June, 1999)
On both sides of the Ring Road, 57 institutions, 10 residential committees, 6 mosques, including 162people, were surveyed during site visits. In addition, telephone interviews and questionnaire surveys wereundertaken. A public meeting was held. The main contents of the project were introduced at the meeting.Public concerns from the meetings as well as from the questionnaires and interviews are summarized insection 5.1.
Second Round of Public Participation (June - September 1999)
Two hotlines for public input, one available in PEO and the other in EIA team, were set up in this stage forpublic inquiries. A preliminary EIA Summary in both Chinese and Uygur was distributed in each of the 26affected residents' committees for public review. At the same time, more than 800 pamphlets weredistributed along the Ring Road introducing the project in both Chinese and Uygur.
The second stage public meeting was held in the UCC on September 24, 1999. Representatives of the localpress and over 140 representatives from sensitive receptors, the resettlement department, the DistrictPeople's Congress and the govenmment agencies attended this meeting.
Future Consultation
Future public consultation will be held at the district level. These meetings will focus on ensuring that thepeople most affected by the project are fully aware of the mnitigation measures. It has been agreed thatthese meetings will be held annually, at least two months in advance of construction, in the areas whereconstruction is to take place each year.
5.5 What mechanisms have been established to monitor and evaluate the impact of the project on theenvironment? Do the indicators reflect the objectives and results of the EMP?
XETAC and Urumqi Environment Monitoring Center have been appointed to undertake independentmonitoring and reporting on environmental impacts. The reports of these consultants will be considered aspart of the annual review of the project.
6. Social:6.1 Summarize key social issues relevant to the project objectives, and specify the project's socialdevelopment outcomes.
OD 4.30 on Involuntary Resettlement applies to this project. The PEO commissioned the ShanghaiAcademy of Social Sciences who undertook baseline social analyses and resettlement planning to ensurethat incomes and living standards are improved, or at least restored, for all persons adversely affected bythe project. Annex 12 reviews adverse impacts related to land acquisition or changes in land use for theproject, and the arrangements proposed in the RAP to mitigate them. Related public consultation anddisclosure activities are also summarized.
With respect to impacts, the project will require 510 mu (34 hectares) of land (along with use of 2,013 mu,or 134 hectares, of existing right-of-way). This includes acquisition of 197.5 mu (about 13 hectares) ofrural land, of which 100.8 mu (about 7 hectares) is cultivated, and transfer of 312.5 mu (about 21 hectares)of urban land-use rights. Acquisition of cultivated land will directly affect 53 households (218 individuals).Structural demolition is expected to total 151,207 square meters, including 57,615 square meters ofresidential housing. A total of 854 households (3,492 individuals) will need to be relocated. A total of 835
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enterprises or work units will be affected by non-residential demolition or loss of land. Of the 854households to be relocated, 261 (or 30.6%) are members of ethnic minorities. The project also will requirerelocation of one mosque.
The draft RAP in English was received by the Bank prior to appraisal and discussed with UMG during theappraisal mission in January 2000. The appraisal mission confirmed the availability of the RAP in Chineseand Uygur in Ururnqi. The final RAP in Chinese and Uygur, with an Annex summarizing Minority Issues,was placed in the Urumqi Public Library on January 20 2000. The final RAP in English was received bythe Bank, (together with a letter from UMG authorizing its disclosure to the PIC), on February 4, 2000.The RAP was cleared on February 14, 2000, and made available to the public (through the PIC) on March1, 2000. A revised RAP, which clarifies and elaborates on RAP arrangements as they relate to ethnicminorities is being prepared.
6.2 Participatory Approach: How are key stakeholders participating in the project?
Socio-Economic Survey
Because of the presence of ethnic minorities in the project area, in addition to the Public Consultationprograms related to environmental and resettlement issues, (described in sections 5.4 and 6.1 above), aseries of focus groups, household interviews and transit passenger surveys were conducted as part of aSocio-Economic Survey (Study). The Xinjiang Social Science Research Institute (XSSRI), a leading localsocial science research institute specializing in ethnic minority issues undertook the study. XSSRIdeveloped the research design, executed surveys and produced Study reports with a view to assessing thetransport-related needs, opinions and attitudes of ethnic minorities and three other potentially vulnerablegroups (floating/non resident population, women and the poor). XSSRI organized and conducted allsurveys. No governnent officials participated in consultations with survey participants. Someneighborhood committee members assisted XSSRI with translation for interviews with ethnic minorityhouseholds.
The scope of study encompassed public transport services and a proposed fare increase as well asparticipants' views on the project in general. Surveys indicate that the public is supportive of the projectand the proposals to reform public transport. The surveyed groups believe that the Ring Road will addresstraffic congestion problems. Public transport reform is also expected to result in more choices for thepublic and more routes covering a larger area. With respect to key research concems about theaffordability of bus fares, respondents from each group, except the poor, indicated that they were willing topay somewhat more than current fares for service improvements. The Study also identified the need forpublic transport service improvements for under-served areas. The results of the surveys will beincorporated into the route network study in sub-component C2(a) of the project, and the development ofthe public transport strategy. These activities will be monitored as part of the annual review of the project.Further details are provided in Annex 14: Socio-Economic Survey.
6.3 How does the project involve consultations or collaboration with NGOs or other civil societyorganizations?
Separate stakeholder meetings were held with leaders of community and religious groups and privateminibus operators to obtain their views on project impacts, mitigation and design. Additionally, astakeholder group of vehicle operators will be convened under the MVECS component to provide technicalguidance on vehicle emission policies.
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6.4 What institutional arrangements have been provided to ensure the project achieves its socialdevelopment outcomes?
The Shanghai Academy of Social Sciences has been appointed to monitor and report on socialdevelopment. The reports of these consultants will be considered as part of the annual review of theproject.
6.5 How will the project monitor performance in terms of social development outcomes?
The Shanghai Academy of Social Sciences has been appointed to monitor and report on socialdevelopment. The reports of these consultants will be considered as part of the annual review of theproject.
7. Safeguard Policies:7.1 Do any of the following safeguard policies apply to the proiect?
PQlliy ApplicabilityEnvironmental Assessment (OP 4.01, BP 4.01, GP 4.01) 0 Yes 0 NoNatural habitats (OP 4.04, BP 4.04, GP 4.04) 0 Yes * NoForestry (OP 4.36, GP 4.36) 0 Yes * NoPest Management (OP 4.09) 0 Yes * NoCultural Property (OPN 11.03) 0 Yes 0 NoIndigenous Peoples (OD 4.20) 0 Yes 0 NoInvoluntary Resettlement (OD 4.30) 0 Yes 0 NoSafety of Dams (OP 4.37, BP 4.37) 0 Yes * NoProjects in International Waters (OP 7.50, BP 7.50, GP 7.50) 0 Yes * No
l_Projects in Disputed Areas (OP 7.60, BP 7.60, GP 7.60) 0 Yes 0 No
7.2 Describe provisions made by the project to ensure compliance with applicable safeguard policies.
OD 4.01 Environmental Assessment and OD 4.30 Involuntary Resettlement apply. For provisions made toensure compliance with these policies, see section E6 above. During preparation, the social scientist in thetask team took the view that OD 4.20 Indigenous Peoples should not apply, given that the minorities hadmigrated to an urban area and the project does not make them vulnerable to group specific impacts.Nevertheless, consistent with good transport planning practice, the task team, sensitive to the ethnic andcommunity issues, took substantive steps to review and mitigate potential impacts to ethnic minorities. Theapplicability of OD 4.20 was discussed in depth by Bank management. After reviewing a range ofopinions on this subject, the ultimate decision of management was based on the professional judgment ofsocial scientists with the requisite qualifications, expertise and project related experience. They concludedthat the ethnic minorities who will be affected by the project are not covered by the provisions of OD 4.20and that therefore the policy does not apply. Annex 15 provides further details.
F. Sustainability and Risks
1. Sustainability:
Sustainable benefits will depend upon several factors including:
Creation and retention of new institutional structures including for formulation and implementation ofurban transport policies, regulation in the passenger transport sector and the reformed public transportcompany.
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Professional development of local technical staff through a combination of formal training, study toursand other means of technical assistance and mentoring by international and domestic experts and "learningby doing". The Urban Transport Sector Leading Group within UMG will play a key role in this respect.
Sustainable financing for public transport and road maintenance. UMG plans to revise the regulatoryand financial framework for public transport to ensure the sustainability of public transport operations, butlacks the experience in making the necessary changes. Budgets for road maintenance need to be set atlevels which provide adequate funding to manage the asset. TA and training in the Public Transport andRoad Network components are designed to address these issues. Annual reviews will permit an active rolefor the Bank in monitoring the progress.
Integrated transport and urban development. Urban development visions will need to be supported byregulations on land use development (and procedures for enforcing them) integrated with supportivetransport investments and policies. UMG has agreed to maintain a continuing dialogue with the Bank onthese aspects. The proposed Transport Network Development study will further the integrated approachadvocated during project preparation.
Implementation and enforcement of the MVECS. The MVECS should be flexible enough to developand apply additional measures as emission levels increase and new approaches are developed worldwide.Annual reviews of the MVECS are designed to permit an active role for the Bank in the design of thesemeasures.
Maintenance of traffic management measures. The ongoing maintenance of any Area Traffic Controlsystem and its associated vehicle detection equipment is cmcial in obtaining the full benefits of reducedcongestion and delay. Maintenance of a proactive interagency Traffic Management Group is necessary toensure that measures are adjusted to changing circumstances.
Maintenance of high public transport mode share. Public transport share of travel demand is high andefforts will be needed to maintain that mode share through service improvements. Annual reviews of thereform program are designed to permit an active role for the Bank in guiding these efforts.
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2. Critical Risks (reflecting the failure of critical assumptions found in the fourth column of Annex 1):
RRisk sk Rating Risk Mitigation MeasureFrom Outputs to ObjectiveA. Road Network Development M1. Use of rational planning and analysis 1. TA aims to strengthen capacity inmethods. programming road maintenance and undertake2. Responsiveness to changing traffic transport network planning.demands 2. Annual review.B. Traffic Management and Road M
Safety1. Traffic management measures are self 1. TA for road user education.enforcing. 2. Dated covenant on Accident Analysis study2. Accident analysis leads to remedial 3. Annual review of program will identify needmeasures (TA). for adjustments.3. Measures are adjusted to changingcircumstances.C. Public Transport S1. Fare/subsidy policies provide for 1. Targeted TA to refine UMG policy on publicsustainable finance in the sector transport reform and development.2. Appropriate regulatory capacity is 2. TA to create new office within UCC andestablished as required strengthen regulatory functions.3. Operators supply services in response 3. Annual review to discuss implementation ofto market demand reform strategyD. Environment Management NI. National standards provide guidance. 1. Assume continuation of these standards.2. Enforcement of Inspection & 2. Proposed Vehicle Emissions Research CenterMaintenance (I/M) programs leads to will review and suggest remedial measures asreduction of emissions . necessary.3. Other measures needed are identified 3. Annual review of MVECS implementation.
and implemented.E. Institutional Development M1. Staff knowledge gained is incorporated 1. Monitoring of production and quality ofinto professional practice. scheduled outputs.2. Plans are implemented. 2. Annual review.
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From Components to Outputs
A. Road Network Development N I. Construction Supervision, environmental and1. Project roads and ring road are built resettlement monitoring teams to be in placeand maintained as designed, including before start of civil works; Confirmation of
interface with local and regional roads. counterpart funds.2. No other major investment is required. 2. Annual review of traffic conditions.B. Traffic Management and Road M
Safety1. Continued high ownership of all 1. Training component designed to maintainelements of program by traffic police. high ownership levels; Annual Review2. Public acceptance of regulations. 2. Piloting of enforcement measures.
C. Public Transport S1. UMG policy guidance. 1. Annual review of reform strategy and2. Support of other UMG units for programpriority measures. 2. Urban Transport Sector Leading Group3. UPTC adoption of further cost oversight; PT investments linked to TA.saving/revenue raising measures. 3. TA to strengthen corporate planning at the
sub-company level.D. Environment Management N1. Continued UMG policy emphasis 1. Annual review of implementation of MVECS
2. Development of local professional 2. Training program strengthens local capacity.capacityE. Institutional Development N Urban Transport Sector Leading Group1. Continued UMG ownership and oversight; TA, training and study tours tosupport encourage local initiatives.
Overall Risk Rating M
Risk Rating - H (High Risk), S (Substantial Risk), M (Modest Risk), N(Negligible or Low Risk)
3. Possible Controversial Aspects:
Urumqi, the capital of the Xinjiang Uygur Autonomous Region, is ethnically diverse. In addition to
Uygurs, persons from 44 other minorities reside in the city, with the minority population comprising 27%of the total. Ethnic relations are sensitive. From the beginning, the task team has been aware of the need
for careful preparation particularly in two components that pose potential issues of inter-ethnic equity. In
Component - A Road Network, there are resettlement-related impacts associated with ring road
construction. These resettlement-related issues have been subject to repeated scrutiny, as explained in the
RAP and summarized in Annex 12. In Component C - Public Transport, the issues relate to changes in bus
fares and services associated with public transport reforrn. Through social assessment, travel preferences
and patterns of minority nationalities have been examined, as summarized in Annex 14. The results are to
be factored into reform strategies to be detailed during project implementation. Annex 15 provides an
overview of issues relating to minority nationalities.
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G. Main Loan Conditions
1. Effectiveness Condition
Standard (including financial)
2. Other [classify according to covenant types used in the Legal Agreements.]
2.1 Covenants on Implementation:(i) Urumqi shall maintain throughout the period of implementation a Municipal Project Leading
Group in close coordination with the Regional Project Leading Group;(ii) Urumqi shall continue to employ throughout the period of implementation a team of
construction supervision experts;(iii) Urumqi shall carry out the EAP and RAP; and(iv) Urumqi shall maintain policies and procedures to enable it to monitor and evaluate the
implementation of the RAP and EAP.
2.2 Dated Covenants: The following activities are to be completed by these years of the projectunless otherwise agreed during the annual review.
2.2.1 Year 2002(i) A3.1 Road Maintenance Management System TA by 3/31/03.(ii) B5. Accident analysis study by 9/30/02.(iii) CI.1 Public Transport Corporate Planning and Reform TA by 9/30/02.(iv) C2. 1 Public Transport Route Network and Bus Priority Studies by 9/30/02. Location of
investments relating to transfer/terninal improvements and additional bus priority schemes aresubject to the results of these studies.
(v) B3. Parking study TA by 9/30/02.
2.2.2 Year 2003 E. I Transport Network Development Program Study by 9/30/03 leading to therefinement of the Master Plan Transportation elements.
2.3 Monitoring and ReportingUrumqi shall prepare quarterly reports and furnish to the Bank not later than April 30, July 31, October 30each year to:
(i) set out physical progress on a component and sub-component basis (including trafficmanagement during construction);
(ii) set out financial progress reports on a component and sub-component basis includingavailability of counterpart funds;
(iii) set out progress on activities related to the MVECS, Road Maintenance and Public TransportStrategies;
(iii) summarize environmental and resettlement monitoring and evaluation activities (includingmonitoring by the independent entities); and
(v) set out any additional measures needed to ensure the efficient implementation of the project.
After furnishing each such report, Urumqi shall review the same with the Bank and take all measuresrequired to ensure the efficient completion of the Project, based on the recommendations of the report andthe Bank's views.
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2.4 Annual ReviewUrumqi shall prepare annual reports not later than January 31 each year to:
(i) set out and evaluate physical and financial progress against the AWP for the preceding year;(ii) evaluate implementation as measured by the project performance indicators;(iii) evaluate implementation of the MVECS, Public Transport, and Road Maintenance;(iv) set out the AWP for following year; and(iii) indicate any requirements for any formal update to the PIP.
By April I of each year Urumqi shall evaluate the annual report with the Bank.
H. Readiness for Implementation
1 1. a) The engineering design documents for the first year's activities are complete and ready for the startof project implementation.
0 1. b) Not applicable.
1 2. The procurement documents for the first year's activities are complete and ready for the start ofproject implementation.
O 3. The Project Implementation Plan has been appraised and found to be realistic and of satisfactoryquality.
1 4. The following items are lacking and are discussed under loan conditions (Section G):
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1. Compliance with Bank Policies
Z 1. This project complies with all applicable Bank policies.FO 2. The following exceptions to Bank policies are recommended for approval. The project complies with
all other applicable Bank policies.
The EA, EMP and EA Summary were sent to the World Bank Public Information Center in Washington,D.C. on December 29, 1999. The updated Environmental Data Sheet and updated Project InformationDocument were sent to the PIC on January 14, 2000. The draft RAP in English was received by the Bankprior to appraisal, and discussed with UMG during the appraisal mission in January 2000. The final RAPwas received by the Bank on February 4, 2000, and after clearance, was sent to the PIC on March 1, 2000.
Edward B. Dotson Jitendra N. Bajpai Ytlcon Huang oTeam Loader Soctor Manager Country Manager
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Annex 1: Project Design Summary
CHINA: Urumqi Urban Transport Improvement ProjectKey Performance
Hierarchy of Objectives Indicators Monitoring & Evaluation Crtcal AssumptionsSector-related CAS Goal: Sector Indicators: Sector/ country reports: (from Goal to Bank Mission)Promote Growth with Gross Regional Product Occasional Bank urban Increased capacity andEconomic Stability transport sector reports & productivity of infrastructure
Implementation Completion promotes economic growthReport (ICR) and stability.
Relieve Infrastructure Progressive increases in urban Annual Review, Mid-termBottlenecks transport system productivity review and ICR
above baseline levels
Safeguard the Environment Reduced environmental Environmental impacts fromimpacts over baseline (1998 increased travel demand canpre-project) levels. be mitigated so as to produce
an environmentallysustainable solution.
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K4y PerformanceHierarchy of Objctives Indicators Monitoring & Evaluation Critical Assumptions
Project Development Outcome i Impact Project reports: (from Objective to Goal)Objective: Indicators:OVERALL OBJECTIVE: See below. Annual Review, Mid-term Good accessibility is critical toFoster a multi-modal urban review and Implementation facilitate and sustain futuretransport system which is Completion Report economic developmentplanned, designed and usedfor the safe, efficient and Multi-modal development ofhealthy movement of people the urban transport systemand goods. will improve quality of life
and safeguard theenvironment
SPECIFIC OBJECTIVES
Develop and manage the Cross-town travel times (N-S), 1. Inter-city highway andurban road system to support and speeds in the "old" and urban road integration islocal land use, regional "new" CBD (particularly for necessary to facilitate goodstransport and the city's overall buses); Network condition, movement and materiallyeconomic development plans annual road maintenance reduce travel times
program, budget, unit costs. 2. Land use, developmentcontrols and transport pricingare complementary totransport policies andinvestments
Increase the safety and Incidence and severity of Effective enforcement ofefficiency of road network accidents (injuries, fatalities); traffic regulations and
traffic flow conditions on key adaptation of measures toparts of the network; maintain performance withIncreased throughput growth in traffic.(person-trips) across keyscreenlines.
Develop public transport as a Mode share of public transport Incremental development ofviable and sustainable across screenline counts; public transport sustains modealternative to private car usage Average bus operating speeds; shift as incomes rise.
Operating cost- recovery.
Protect and improve the Testing rate and passing rate Inspection & maintenanceenvironment of vehicle emissions programs enforced beyond
inspections; Proportion of fleet project implementationtested; Landscaped area.
Strengthen local institutional Development and Agencies and staff remaincapacity and integration implementation of policies, after project implementationwithin urban transport sector plans and programs.
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Key PerformancHlerarchy of Objectis Indicators Monitoring & Evaluation Crtical Assumptions
Output from each Output Indicators: Project reports: (from Outputs to Objective)Component:A. Operational primary road Performance at key Ring Road "Before and After" surveys as I . Use of planning andnetwork based on ring road and interface locations; use of implementation proceeds analysis tools (e.g. Roadwith efficient links to local road maintenance systems. Maintenance System andand regional roads. Transport Network
Development Program Study)to identify and program roadimprovements.2. Responsiveness tochanging traffic demands
B. Effective traffic Use of ATC and road accident "Before and After" surveys as 1. Traffic management rulesmanagement and road safety analysis systems; see also implementation proceeds are self-enforcing.programs. Indicators for A. above. 2 Accident analysis leads to
remedial measures.3. Measures are adjusted tochanging circumstances.
C. More efficient and Monitoring Indicators: Joint annual review of public 1. Fare/subsidy policiesattractive public transport Reduction of public transport transport companies annual provide for sustainable financeservices. staff/vehicle ratio, increase in reports and supporting data. in the sector.
fleet size, and refinement of "Before and After" surveys for 2. Appropriate regulatorypolicy and operating subsidies. on road service improvements capacity established as
required for new industrystructure.3. Operators supply services inresponse to market demands
D. Active mitigation of Ring Use of monitoring and Annual Review, Mid-term 1. National standards provideRoad impacts and mobile Inspection and Maintenance review and Implementation continued guidance.source emissions; "Greener" systems; satisfactory Completion Report 2. Enforcement of Inspectionimage of city. mitigation of project impacts, & Maintenance (I/M)
including increased planting programs leads to reduction ofof green space. emissions.
3. Other vehicle/fuel relatedmeasures are identified andimplemented through MVECS
E. Strengthened local Local structural agencies Annual Review, Mid-term 1. Staff knowledge gained isinstitutional capacity and producing multi-modal review and Implementation incorporated into professionaltechnical capabilities policies, plans and programs Completion Report practice.
with limited outside help 2. Plans are implemented.
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|Hierrcy ofObcivs InIatr Montoin & Eva; :i:i:00 *4luation Cu$lta Asmpins:Project Components I Inputs: (budget for each Project reports: (from Components toSub-components: component) Outputs)A. Road Network $222.6 million See Below; also Construction 1. Project roads and ring roadDevelopment Supervision Teams provide are built and maintained as
Bank and PEO with quarterly designed including interfaceprogress reports. with local and regional roads.
2. No other major investmentsare required for efficient useof network
B. Traffic Management $ 11.8 million See Below. 1. Continued high ownershipand Road Safety of all elements of program by
Traffic Police2. Public acceptance ofregulations
C. Public Transport $ 7.4 million See Below. 1. UMG policy guidance2. support of other UMG unitsfor priority measures3. Increased ability of UPTCto adopt cost saving/revenuegenerating measures
D. Environmental $ 4.6 million See Below. 1. Continued UMG policyManagement emphasis and support for
MVECS2. Development of localprofessional capacity
E. Institutional $ 3.5 million See Below. Continued UMG ownershipDevelopment
For all Components: For all Components:1. PEO Maintains project 1. Continued local support formanagement information all project components;system. 2. Active supervision by2. PEO produces monthly Bank to assist PEO in projectprogress reports which implementation.;compare planned and actual 3. Adjustment of componentprogress for each project design to changing physicalcomponent in terms of cost, and financial circumstancesphysical and financial during implementation inprogress and disbursements. order to achieve project
objectives.
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Urban Transport Strategy:
Concluding statement from Urban Transport Symposium (see Stares and Zhi, China's Urban TransportDevelopment Strategy: Proceedings of a Svmposium in Beijing, November 8-10, 1995, World BankDiscussion Paper No. 352, Washington, D.C., 1996):
"Two to three years ago, only the very largest municipalities were concemed about urbantransport. Water supply and sewage disposal seemed more urgent problems. This has changed forone very clear reason: the rising number of motor vehicles - cars, trucks, taxis and motorcycles -has resulted in a sharp increase in traffic congestion. What can be done about it? Urban transportis complex. Action is needed in many areas at the same time - policy, institutions, management,prices, infrastructure construction and other investments. It does not help to solve one problem ifothers are ignored."
There was considerable agreement among the delegates on the general lines of actions to be taken. Thesewere brought together as five principles, four criteria and eight actions.
The five principles represent themes that should guide urban transport planning andoperations at this time in China's development:
I. Transport is about moving people and goods, not vehicles;2. Transport prices should reflect full social costs;3. Transport reformns should deepen to align with socialist market principles so as to increase
efficiency;4. The role of government should be to guide transport development;5. The role of the private sector in providing transport services should be encouraged.
City plans and policies for managing transport should meetfour criteria:1. Environmental sustainability2. Economic viability3. Financial affordability4. Social acceptability
Consistent with these principles and criteria, eight actions are recommended:1. Reform urban transport administration2. Upgrade the status of traffic management3. Prepare a strategy to mitigate motor vehicle air and noise pollution4. Develop policies to manage traffic demand5. Develop a strategy for mass transit6. Reform public transport management and operations7. Develop a financing strategy for the transport sector8. Strengthen the framework for transport planning and capacity building
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Annex 2: Detailed Project DescriptionCHINA: Urumqi Urban Transport Improvement Project
By Component:
Project Component 1 - US$222.60 million
A. Road Network Development (See Map 30808R)
Al. Ring Road Construction ($216.3 million). This sub-component includes ring road construction,road maintenance equipment for the ring road, ring road traffic control equipment, environment impactmitigation measures, consultant services for construction supervision and environment monitoring, and landacquisition and reseftlement (including monitoring activities). The civil works are divided into four sectionswhich correspond generally with the annual construction staging, except for the tunnel in section 2 which isto be constructed over two years. Two-thirds of the new construction (19.4 kin) will be to expresswaystandards, with urban arterial standards adopted for the remaining 9.6 km in the north-east, where trafficdemand is lower. Over 70 percent of the Ring Road will be built at-grade, with elevated construction for8.3 km in the inner areas, close to the CBD. A total of 18 pedestrian facilities (16 overpasses and 2underpasses) and a number of at-grade pedestrian crossings will be constructed to ensure pedestrian accessand safety.
It is proposed to construct the Ring Road in four phases, corresponding approximately to the four yearconstruction program and involving a total of 21 contract packages. These are described below:
* Year I (Contracts 1-6) WuChang Interchange - Xi Shan Interchange (7.45kim), pluspreliminary works on the tunnel in Contract 7. This section involves the upgrading of an existing2-lane road to a 6-lane at-grade expressway, with two 2-lane frontage service roads. The sectionstarts at a new grade-separated interchange at WuChang Highway/Altay Road to be built by theXinjiang Highway Bureau as part of the Airport Expressway. Near Hangjin Hospital, a vehicleoverbridge with associated slip roads is proposed to provide access to adjacent development landand to allow traffic to make U-turns. A grade-separated flyover is proposed at Karamay RoadWest. A fully grade-separated interchange is proposed at the junction with XishanRoad/Nanliangpo Road. With the exception of small areas at the interchanges, the new road isconstructed within the existing planning line (red line).
This section of the Ring Road will relieve the existing heavily trafficked routes of Altay Road andBeijing Road/Yuhua Road which carry substantial volumes of bus traffic. Coupled with the secondyear package, it will provide an improved high standard route for traffic from the expanding areasof the city in the north-west and the external expressway system (including the new airportexpressway) to the central and southern areas of the city.
* Year 2 (Contracts 7-11) XiShan Interchange - TuanJie Road (5.71 kim), including thecompletion of the tunnel (Contract 7). This section will be built as a 4-lane expressway andincludes two parallel 450 m long tunnels through Hongshan mountain. No service roads areproposed on the tunnel section. Alternative provision for local traffic is made via XishanRoad/Nanliangpo Road which will be reconstructed over a 2.48 km. section as a local service road(Contract 10), including a new flyover. South of the tunnel, most of the section is elevated 4-laneexpressway, constructed above the line of existing roads, which are retained for local access.
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Access ramps to and from the expressway are proposed at Xishan Road, Baoshan Road, theRailway Station, QianTangJiang Road and Tuanjie Road. The alignment past the Railway Stationincludes a new flyover and makes partial use of the existing grade-separation. AlongQiantangjiang Road, the route makes use of an existing interchange at the junction with HetanRoad, together with a 540 m section of 4-lane flyover.
This section of the Ring Road will improve access to the Central Business District (CBD) from allsectors of the city and will also provide an alternative route for through (or non-essential) trafficwishing to by-pass the inner areas. This should lead to a reduction of traffic volumes on CBDstreets with resultant environmental gains and opportunities to provide priorities for publictransport.
Part of the section south of the tunnel (near the Guanmin Mosque) is constructed in deep cut. Useof a box-culvert section is to be considered for one of the slip roads to reduce the height of the cutand to provide additional eiivironmental protection.
* Year 3 (Contracts 12-17) Tuanjie Road - Karamay Road East Interchange (6.20 km). Thissection contains 3.2 km of elevated 6-lane expressway, 1.7 km of elevated 4-lane expressway, andtwo sections totaling 1.3 km of at-grade 6-lane expressway. An elevated solution is adopted toavoid severing the large number of local roads which cross the alignmnent, to ease pedestrianmovement, and to minimize the extent of land-take. Two sections are proposed at-grade due totopographical considerations and the need to reduce the gradient of the expressway.
The alignment follows existing roads throughout: these are retained as at-grade frontage roads forlocal traffic. Eight sets of signals, to be linked into the proposed Area Traffic Control (ATC)system, are provided at junctions with the local road network. In total, seven sets of on and offramps link the expressway with the local frontage roads.
This section of the Ring Road will provide additional north-south capacity to the east of the citycenter and will relieve the parallel competing routes which pass through the heart of thecommercial core. Traffic demand on this section can be expected to increase further with thesubsequent development of sites to the north-east of the city.
* Year 4 (Contracts 18-21) Karamay East - Altay Road (9.645 km). This section will beconstructed as a 6-lane urban arterial, generally with at-grade signalized junctions, as part of thearterial road network in the area. In addition to the Karamay East flyover, two simple fly-overs willbe provided at Beijing Road and Altay Road. Traffic forecasts on this section are significantlylower than elsewhere, due to the limited extent of development, and do not justify expresswaystandards.
The alignment in the north-east quadrant is determined by the extent of potential miningsubsidence, which also constrains development in the area. In the longer-term, when the miningarea becomes available for development, it is envisaged in the Master Plan that the Ring Roadcould be completed - as an expressway - further north in conjunction with the overall urbandevelopment.
A 2.15 km section between Liudaowan Road and NanhulXinYi Road will be built on a newalignrment, which has been selected to minimize property impact and follow the southern boundary
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of potential subsidence: elsewhere the Ring Road involves the upgrading of existing roads - NanhuRoad, Suzhou Road and Altay Road.
In addition to the two fly-overs, there is an existing interchange with Hetan Road and there will besix sets of at-grade signals. Allowance in the engineering design has be made for the possibleconstruction, at a later date beyond project completion, of a one-way flyover at Nanhu/XinYijunction.
A1.2 Road Maintenance Equipment. In order to ensure the road condition after the ring road opens,the project will provide road maintenance equipment for the ring road. The major equipment will include:road maintenance monitoring vehicles, snow cleaning vehicles, road cleaning vehicles, a tipper truck, roadcomprehensive maintenance equipment, cement and concrete road pavement equipment, cement andconcrete road maintenance equipment, bridge check and maintenance equipment, road rollers, bitumenpavement, road check, road maintenance lift, underground pipe check equipment, bitumen and concretemixer, road crack fixed equipment, and other maintenance equipment.
A1.3 Traffic control and monitoring facilities. The project will provide traffic control facilities for theexpressway sections of the ring road.
A1.4 Environmental impact mitigation building works. In order to mitigate noise impacts, theproject will provide mechanical ventilation and cooling units to about 5700 households to permit them tokeep their windows closed. This is in addition to other mitigation measures including noise barriers whichare included in the civil works contracts.
A1.5 Consulting services for construction supervision and environmental monitoring. The projectwill finance both local and international consultants to provide construction supervision services for theconstruction of the ring road according to international contract practice. Provision is also made forextemal monitoring in accordance with the EMP.
At.6 Land Acquisition and Resettlement. The construction of the ring road in the city center area willinvolve land acquisition and the resettlement of people, units, and enterprises. The resettlement action plan(RAP) for the project will guide the implementation and monitoring of the annual land acquisition andresettlement for all phases of the project. The project will finance costs related to resettlement activitiesand monitoring. (Land acquisition is not Bank financed).
A2. Other Road Network Improvements ($2.8 million)
A2.1 Constructing a rnissing link from Altai to Baoshan Road, Baoshan Road to Huanghe Road as fourlanes and improving traffic management and channelization facilities.
A2.2 Widening of 0.48 km. of Heilongjiang Road from Baoshan road to Nianzigou road frombi-directional two and three lanes to bi-directional three lanes.
A2.3 Widening of 0.71 km. of Tuanjie Road (from Shengli Road to Art School) from bi-directional twolanes to bi-directional four lanes.
A2.4 Creation of one way pairs (Jiefang Road and Heping Road) and (Zhongshan Road and MinzhuRoad). In the north-south direction, the road pairs are North Jiefang Road (0.79 km) and North Heping
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Road (0.91 krn). This one-way pair will allow one lane of three in each direction to be used as bus-onlylanes. In the east - west direction, the road pairs are Minzhu Road (0.91 kin) and Zhongshan Road(completed).
A3. Road Maintenance ($3.5 million)
A3.1 Road, Bridge and Drainage Maintenance Management System (TA). The TA will review thecurrent road maintenance management problems, and suggest ways to improve the current management bystrengthening the institutional structure, improving the road maintenance planning, rationalizing the use ofthe funds, increasing the source of funds, providing a better information collection system, and providingbetter infornation and assistance to decision makers.
A3.2 Road Maintenance Equipment. In order to improve the current road maintenance facilities, theproject will finance the provision of road maintenance equipment for other non ring road sections. Themajor equipment is likely to include: milling and planing machine; multi-function road maintenancevehicles; road monitoring vehicle; machine for repairing cracks; vehicle for dredging pipes; 2 heavy-typecleaning-up vehicles; heavy-vehicle snow clearing vehicles; capstan-type plowing vehicles and datacollection equipment.
Project Component 2 - US$11.80 million
B. Traffic Management and Road Safety
B1. Junction Channelization, Traffic Signals and Area Traffic Control (ATC) ($4.1 million)includes:
* channelization at 25 intersections, (of which 24 are at grade junctions on the ring road);* traffic signals and ATC at 59 junctions (of which 18 are related to the ring road);* vehicle actuated signals at a further 23 junctions (of which 12 are on the ring road);* new fixed time signals at a further 3 junctions on the ring road;* 3 sets of vehicle actuated signals associated with bus terminals; and* signs and lane markings.
Forty seven of the eighty-eight junctions to be equipped with traffic signals are existing sites to be upgradedand forty-one are new sites.
B2. Pedestrian Facilities ($2.0 million) This builds on existing programs currently being carried outby the Urumqi Municipal Government (UMG) by:
* enhancing road safety through physical segregation;* combining NMV and pedestrian facilities where appropriate, following on from successful
European practice; and* reflecting the possible downgrading of some roads in the CBD to a lower level in the road
hierarchy (as a result of the Ring Road) by aiming to introduce a more human scale to the CBDand a more pedestrian friendly environment.
The program includes a pioneering pilot mid-block signaled (pelican) pedestrian crossing, the first inUrumqi; the provision of full signalized phases for pedestrians at traffic-signaled junctions; fouroverbridges/subways; and foot way improvements 7.6 km
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B3. Parking System Improvements ($0.1 million) includes a Parking Study and signage for 35parking areas. The parking study will review the current parking problems, establish a parking policyincluding parking management regulation and policy, and propose further investment in parking systemimprovement.
B4. Enforcement and Road User Education ($3.7 million). Items include: road user educationreview and pilot; enforcement practices review and pilot; command center; and driver/vehicle informationsystem.
B5. Accident Analysis and Road Safety ($0.5 million) includes TA for Accident Analysis Study,accident hot line equipment and accident investigation equipment, analysis software/hardware, and remedialmeasures schemes.
B6. Design, Supervision and Management (NBF) ($1.4 million). Design, supervision, managementand administrative costs of services provided by implementation agencies and PEO.
Project Component 3 - US$ 7.40 million
C. Public Transport
Cl. Reform of UPTC ($3.1 million)
C1.1 Urumqi Public Transport Company Corporate Planning and Reform Study. The objectives ofthe studyinclude:
- improve the current management structure of the Urumqi public transport company,- improve the company's five-year business plan,* review the capital investrnent needed for the improvement of UPTC,- review the fare structure and subsidy level for operational losses, and* establish an improved maintenance policy and plan.
This study will provide the basis for finalizing the scope of the following sub-components:
C1.2 Bus Maintenance Program including a vehicle diagnostics center, bus painting facility, laserengine reconditioning equipment and modemization of other standard equipment.
C1.3 Computer Information System for asset and maintenance management, accounting, payroll andfinancial reporting and possibly centralized vehicle scheduling and dispatch at a later date. The systemincludes a network (server and workstations) to link HQ to each sub-company unit and database, statistical,financial and management software. The system will be finalized according to the strategy identified fromthe studies mentioned above.
C1.4 Wireless Communication System will be operated from the HQ Communications Center andincludes 80-100 walkie-talkie units used by HQ and sub-company staff as well as equipment for 20vehicles.
C1.5 Communications and Training Center. This facility will be built on 1000 sq. meters of the siteof the existing HQ building. It will provide space for dispatch and communications, training and computer
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network equipment. Eventually, it will also house central revenue collection and allocation activities. Thisitem includes a re-training program for surplus staff.
C2. Bus Priority Measures and Passenger Facilities ($3.8 million) includes:
C2.1 Public Transport Route Network and Public Transport Priority Study. The study will reviewthe current bus network and service capacity, review public transport demand, and establish a rationalizedbus network. A separate study will address the need for bus priority measures. These studies will providethe basis for finalizing the scope of the following sub-components:
C2.2 Bus-only lanes. Creation of one-way pairs for Jeifang and Heping Roads will permit bus-onlylanes. A bus priority pilot program includes bus-only lanes, and bus bays, on a 6.8 km. length ofChangjiang, Yangzhijiang and Youhao Roads. See diagram on Map 30847R (Public Transport).
C2.3 Funding for additional bus priority schemes after the bus network improvement and bus prioritystudy. The study will identify more routes for the bus priority lanes, and the project will provide supportfor these new measures.
C2.4 Passenger transfer facilities (including shelter and seating). Conversion of four terminals totransfer facilities and improvement of the railway station terminal. See diagram on Map 30847R (PublicTransport).
C3. Public Transport Public Transport Policy Consultancies ($60,000). Consultancies on specifictopics will be engaged to further refine UMGs public transport reform and development policies. They
will also address creating a new office in the UCC to act as the public transport regulatory/planning agencyof UMG.
C4. Design, Supervision and Management (NBF) ($0.5 million). Design, supervision, managementand administrative costs of services provided by implementation agencies and PEO.
Project Component 4 - US$4.60 million
D. Environmental Management In response to new national motor vehicle emission regulations,Urumqi has developed a winter air pollution treatment plan and gas vehicle development plan. Mainactions to be advanced under the project include:
(a) Strengthen enforcement of fuel regulations especially with respect to lead;(b) Develop public transport as an alternative mode to automobile travel (supported by Component C)
and accelerate retirement of old, polluting vehicles;(c) Set up a motor vehicle emission pollution study center and air pollution automatic inspection
system, as a permanent technical resource center;(d) Implement standards for purchase of new vehicles; and use inspection and maintenance programs
to ensure existing vehicles to meet the new standard;(e) TA Study on emission control technology and measurement;(f) Finish the CNG conversion for public buses and LPG conversion for taxies and further on the
conversion to other type of vehicles;(g) Carry out a public education campaign and convene a stakeholder group including transit
companies and taxi companies to provide technical guidance on vehicle emissions policies.
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The project's Greening and Motor Vehicle Emission Control Strategy (MVECS) sub-components are bothdesigned to support local initiatives.
Dl. Greening/Ring Road Landscaping ($2.8 million). Greening of 0.44 million sq. meters of which0.23 million sq. meters will be outside the right-of-way (red-line) of the Ring Road.
D2. Motor Vehicle Emission Control Strategy ($1.5 million)* Vehicle Monitoring System - Inspection and maintenance, monitoring and analysis equipment, and
database and computer network to link the above systems.* Vehicle Pollution Control Research Center - Research including motor vehicle emission control
studies and study tours [see Component E].* Environment Law and Regulation Strengthening (NBF) - public education campaign, research.* Design, Supervision and Management (NBF) ($0.4 million).
Project Component 5 - US$3.50 million
E. Institutional Development: Urban Transport System Management
El. UMG Transport Policy and Planning ($1.1 million)
E1.1 Creation of an Urban Transportation Sector Leading Group, comprised of decision makers fromthe various city agencies with responsibilities for urban transport.
E1.2 Establishment of an office for the routine works and selection of permanent and temporarytechnical experts to provide policy and planning advice to these decision makers.
E1.3 Establishment within the Urban Planning Bureau of a transportation planning and modeling unit.
E1.4 Strengthening of public involvement in the planning process, including the involvement ofstakeholder groups advising on the MVECS.
E1.5 A three-year Transport Network Development study to undertake multi-modal analysis andcoordination with land use plans in support of the Transport Master Plan.
E1.6 Office and model and data collection facilities and equipment.
E1.7 Administrative costs for the establishment of agencies.
E2. Domestic and Overseas Training ($1.3 million) for all components and agencies. Training toassist the implementing agencies: (1) in the implementation and operation of the components for which theyare responsible, and (2) in the collection and analysis of data for the indicators to be used for monitoringthe performance of the project in meeting the development objectives. Details are available in the Projectfile and the PIP.
E2.1 Domestic and overseas training for road network improvement component which will include theagencies of ring road construction company/PEO, municipal engineering construction bureau, and roadmaintenance management agencies.
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E2.2 Domestic and overseas training for the traffic management component for the various agenciesinvolved.
E2.3 Domestic and overseas training for the public transport component for the public transportcompany and other government related agencies.
E2.4 Domestic and overseas training for the environment component for environmental agencies and themotor vehicle emission control strategy leading group.
E2.5 Domestic and overseas training for the institutional development component for the leading groupand the transportation planning unit.
E2.6 Domestic and overseas training for project management will include the PEO, the Sector leadinggroup, province and municipal finance bureaus, the Urumqi construction commission, and the municipalgovernment.
Detailed domestic and intemational training plans are included in Project Implementation Plan.
E3. Technical assistance for Project Management ($0.9 million)
E3.1 Administrative costs for project management.
E3.2 Equipment and facilities for the PEO.
E4. Administrative Costs of data collection for performance indicators ($ 0.2 million)
The implementation cost will be provided to collect the data and review the performance indicators.
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Annex 3: Estimated Project CostsCHINA: Urumqi Urban Transport Improvement Project
Local Foreign TotalProject Cost By Component US $million US $million US $million
A. Road Network Development 139.30 55.50 194.80B. Traffic Management and Road Safety 5.20 5.40 10.60C. Public Transport 4.20 2.50 6.70D. Environmental Management 2.20 1.90 4.10E. Institutional Development 1.80 1.50 3.30
Total Baseline Cost 152.70 66.80 219.50Physical Contingencies 14.80 6.20 21.00Price Contingencies 5.50 4.00 9.50
Total Project Costs 173.00 77.00 250.00Interest during construction 19.00 19.00
Front-end fee 1.00 1.00Total Financing Required 173.00 97.00 270.00
Local Foreign TotalProject Cost By Category US $million US $million US $million
Goods 4.20 17.20 21.40Works 103.00 57.00 160.00Services 0.60 2.50 3.10NBF 65.20 0.30 65.50
Total Project Costs 173.00 77.00 250.00Interest during construction 19.00 19.00
Front-end fee 1.00 1.00Total Financing Required 173.00 97.00 270.00
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Annex 4: Cost Benefit Analysis SummaryCHINA: Urumqi Urban Transport Improvement Project
Planning Background
The rate of development of the local economy, resident and floating (non-resident) population and theregistered vehicle fleet from 1985 to 1997 is shown in Table 4.1 (historical). Historically, Urumqi GDPgrowth for the period (219 percent) outpaced national growth (188 percent). Resident population inUrumqi Municipality grew by 30 percent, while employment increased by 25 percent. Although theincrease in the vehicle fleet was (at 135 percent) well below growth in GDP, the growth in the passengervehicle fleet from a relatively low base was 475 percent. In spite of this rapid growth, there were still only24 passenger vehicles per thousand residents in 1997. The potential for further growth in the fleet is great.
Table 4.1 (projected) also presents the forecasts for future population growth, economic growth and thedevelopment of the vehicle fleet. Future planning horizon years corresponding with travel demand modelforecast years are 2004 (the assumed first year of operation for the whole Ring Road), 2010 and 2020.Over the period 1997 - 2020, Urumqi's GDP is forecast to increase by 347 percent with both populationand employment increases of 49 percent. The fleet is forecast to increase by 279 percent to a total of300,000 vehicles in 2020. The passenger vehicle fleet is forecast to increase by 470 percent to 210,000 or93 per thousand residents.
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Table 4.1: Economic, Demographic and Vehicle Fleet Statistics in Urumqi Municipality
1285 i990 1995 1997 2004 2010 2020historical projected
Urumqi Registered Vehicles ('000)Cars and minibuses 5.9 7.1 20.5 27.1 52.8 88.5 191.1Taxis 0.1 0.7 4.6 5.7 7.0 8.0 11.0Buses >19 seats 0.4 2.5 3.2 4.0 5.3 6.3 7.7
Sub-Total Passenger 6.4 10.3 28.2 36.8 65.1 102.8 209.7Sub-Total Goods 27.2 26.7 39.1 42.3 52.9 63.7 90.3All Vehicles (excl. m/cs) 33.6 37.0 67.3 79.1 118.0 166.5 300.0
Motorcycles na 13.1 18.5 19.7 na na na
Urumqi Registered Population (mil.) 1.17 1.31 1.44 1.52 1.79 2.07 2.27
Vehicles per'000Cars and minibuses 5.0 5.4 14.2 17.8 29.4 42.8 84.3Taxis 0.1 0.5 3.2 3.8 3.9 3.9 4.9Buses >19 seats 0.4 1.9 2.2 2.6 2.9 3.0 3.4
Sub-Total Passenger 5.5 7.8 19.6 24.2 36.3 49.8 92.6Sub-Total Goods 23.2 20.3 27.1 27.9 29.5 30.8 39.8All Vehicles (excl. m/cs) 28.7 28.2 46.7 52.1 65.8 80.6 132.4
Employment (mil.) 0.55 0.65 0.68 0.69 0.82 0.95 1.03
Urumqi GDP (1997 Rmb bill.) 6.8 12.0 18.4 21.7 37.2 56.7 96.9GDP/Registered Resident ('000 Rmb) 5.8 9.2 12.8 14.3 20.7 27.5 42.8GDP/Employee Rmb'000 12.4 18.5 27.0 31.4 45.3 59.7 94.3
The projections above are the basis for the 1997 Master Plan update. This update, which will be the basisfor the project, is now in the final stages of approval by the Government.
Study Area
For the purposes of travel demand forecasting, a study area smaller than the municipality was defined.This study area is known as the built-up urban area surrounding the city proper and covers approximately139.5 sq. kilometers. Table 4.2 presents the study area population and employment data and growth rateswhich were used in traffic analysis. (Municipal employment is located entirely in the study area and thus isidentical to citywide employment reported in Table 4.1 above.) The figures below suggest a populationdensity of 10,100 persons/sq.km. in the study area in 1997.
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Table 4.2 GDP, Population, and Employment Growth in the Study Area
GDP a.a.g.r. Population a.a.g.r. Employment a.a.g.r.billion RMB (million) (million)(1997 prices)1 12.0 1.05 _ _ 5
1995 18.4 8..8% 1.26 3.6% 0.68 0.9%1997 21.7 8.6% 1.41 5.7% 0.69 0.7%2004 37.2 8.0% 1.66 2.3% 0.82 2.5%.2010 767 3% I1.90 2.3% 0.95 2.5/2020 96.9 5.5% 2.10 . 1.0% 1.03 0.8%
Note: a.a.g.r.- Average annual growth rate since previous year shown.
Modeling
The economic evaluation for the Project utilizes a standard cost-benefit approach. The evaluation includesthe Project's major investment in the Ring Road which accounts for some 86 percent of the project'sfinancial cost. Benefits from the Ring Road investment were estimated using a newly-developed transportmodel of the Urumqi urban area. Using data from surveys undertaken in 1998, an Emme/2 model of theUrumqi urban area was calibrated by domestic consultants Shanghai Comprehensive City andTransportation Planning Institute (SCCTPI). Data collection activities included the following surveys:
o extemal stations (surveyed 18/19 August 1998)* vehicle travel and screen line traffic counts (31 August)* home interviews (14-19 September)* major trip production points (21 September)- intersection traffic volume (22 September)- transit ridership (30 September/7 October)
The results of the surveys are presented in "Urumqi Travel Survey Analysis Final Report" January 1999,SCCTPI. Following calibration of the model, projections of travel demand were performed in two stagescorresponding to the use of a vehicle-trip based model to undertake Strategic Planning and Analysis andsubsequent expansion of the vehicle-trip model into an integrated person-trip model for EconomicEvaluation.
Strategic Planning and Analysis
Using the Emme/2 model, two strategic planning exercises were undertaken using a fixed matrix vehicletrip model, and forecast volumes in 2004, 2010 and 2020. These are described as follows:
1.) Strategic Network Analysis was undertaken to identify the need for a major investment and comparealtemative investnent programs to meet future demand. Five networks modeled were:
A. The existing road network plus new links and upgrading planned to be in service in eachmodeled year as per the Master Plan, but excluding the Ring Road.
B. Network A plus the whole Ring Road.C. Network A plus limited upgrading of existing roads on the Ring Road alignment, together with
complementary improvements to other parts of the network, as a lower cost altemative to theRing Road.
D. Network A plus infrastructure to support bus priority measures on major arteries.
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E. Network A plus a north-south light rail transit (LRT) line and feeder bus services with buspriority measures on other corridors.
The results of Strategic Network Analysis derived in August 1999, are shown in Table 4.3. The averagespeed over the whole network for Network A ("do minimnum") is projected to be 30.8 kph in 2010.Estimated volume/capacity ratios on key north-south corridors and CBD streets indicate congestedconditions under this scenario. The major investment in the Ring Road (Network B) improves thissubstantially to 37.6 kph, with the greatest increase as expected on the Ring Road corridor, from 25.4 to47.7 kph. A significant improvement is also obtained in the CBD, from 17.2 to 21.4 kph. The major publictransport network E (LRT) produces small savings in vehicle krn over Network B while improving speedsin the CBD over those of Network A, however the specification of this alternative network was not ideal.The lower-cost alternative road network (Network C) and bus-oriented public transport (Network D)scenarios also improved on Network A, but did not perform as well on system performance indicators asNetwork B (Ring Road), due in part to the lower investment costs associated with those options.
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Table 4.3: Network Performance in 2010
Network Indicator RingRoad Inner Outer Total CBD
A Vehicle km million 0.9 3.0 5.4 9.3 1.3Vehicle hours '000 34.7 135.4 132.5 302.6 74.0Average speed kph 25.4 22.4 40.7 30.8 17.2
B Vehicle km million 1.8 2.3 5.1 9.2 1.0Vehicle hours'000 37.3 82.9 124.8 245.0 46.7Average speed 47.7 28.1 40.8 37.6 21.4
C Vehicle km million 1.0 2.9 5.3 9.2 1.3Vehicle hours'000 30.1 113.4 128.7 272.2 61.0Average speed 32.0 25.9 41.2 33.8 20.7
D Vehicle km million 0.8 3.0 5.3 9.1 1.3Vehicle hours '000 32.2 128.0 129.7 289.9 68.4Average speed 26.0 23.1 40.9 31.4 18.4
E Vehicle km million 0.9 3.0 5.2 9.1 1.3Vehicle hours '000 30.5 126.3 128.6 285.4 68.2Average speed 28.5 23.4 40.8 31.8 18.4
Change %B/A Vehicle km 101.6 -23.4 -5.4 -1.1 -21.4
Vehicle hours 7.4 -38.8 -5.8 -19.0 -36.8Average speed 87.7 25.1 0.4 22.1 24.5
C/A Vehicle km 9.2 -3.2 -1.6 -1.1 -0.8Vehicle hours -13.3 -16.2 -2.9 -10.0 -17.5Average speed 25.9 15.6 1.3 10.0 20.2
D/A Vehicle km -5.0 -2.5 -1.6 -2.2 -1.0Vehicle hours -7.2 -5.5 -2.1 -4.2 -7.5Average speed 2.3 3.1 0.5 2.1 7.0
E/A Vehicle km -1.7 -2.5 -2.6 -2.5 -1.4Vehicle hours -12.2 -6.7 -3.0 -5.7 -7.8Average speed 12.0 4.5 0.4 3.4 7.0
B/C Vehicle km 84.6 -20.9 -3.9 -0.1 -20.7Vehicle hours 23.8 -26.9 -3.1 -10.0 -23.4Average speed 49.1 8.2 -0.9 11.0 3.6
Note: inner is within Ring Road (including CBD) outer is outside Ring Road.
This exercise demonstrated the usefulness of Strategic Network Analysis as a planning tool, and willcontinue under planning activities identified in Component E: Institutional Development (TransportNetwork Program Development Study). For the purposes of economic evaluation, modeling of thesenetwork alternatives was carried forward for an ernhanced Network A (A* to represent a more realistic "dominimum") and Network B (Ring Road) only.
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Alternatives Analysis (Alignment and Standards)
The use of the vehicle model to test alternative junction layout and design standards was continuousthroughout the preliminary design process. A major outcome of demand analyses was the reduction ofroadway standards for the eastern and northern sections of the ring road alignrnent. Traffic figures alsoinformed decisions relating to the need for elevated sections, number of lanes, and interchange layout andscale. Design changes are documented in the various Ring Road feasibility and modeling reports as listedin Annex 8. Final traffic volumes (2-way, 24-hour) assigned to the Ring Road and to the local roads on thealignment in 2004, 2010 and 2020 are given in Table 4.4 by homogeneous section. Volumes on the RingRoad in 2004 range between 22.5 and 47.4 thousand vehicles per day. The range for 2020 is between 38.0and 90.9 thousand. Local road volumes refer to auxiliary roads for at-grade sections or surface roadswhere the Ring Road alignment is elevated.
Table 4.4: Ring Road Traffic Volumes(2-way, daily)
Ring Road 'OOOtvpd Avg. Annual Growth Local Road 'OOO/vpd Avg. Annual GrowthRoad Section 2004 2010 2020 200410 2010-20 2004 2010 2020 2004-10 2010-20Wood Plant-Karamay V 43.2 51.1 63.6 2.8 2.2 4.4 14.1 21.8 21.6 4.4Karamayi W.-Xishan 44.0 62.4 81.9 6.0 2.8 4.5 9.2 13.6 12.7 4.0Xishan-Baoshan 43.5 60.9 81.8 5.7 3.0 18.0 27.9 37.7 7.6 3.0Baoshan-Heilongjiang 43.5 60.9 81.8 5.7 3.0 36.8 33.8 51.0 -1.4 4.2Heilongjiang-Qitai 43.5 60.9 81.8 5.7 3.0 21.1 21.2 30.2 0.1 3.6Changjiang-Hetan 46.8 61.2 84.9 4.6 3.3 14.5 17.0 23.1 2.7 3.1Hetan Crossing S. 39.1 49.7 75.7 4.1 4.3 0.0 0.0 0.0 0.0 0.0Hetan-Jiefang 40.0 47.5 76.7 2.9 4.9 22.6 26.6 32.5 2.8 2.0Jiefang-Tuanjie 40.0 47.5 76.7 2.9 4.9 16.2 18.7 23.7 2.4 2.4Tuanjie-Yuejin 33.8 46.3 86.3 5.4 6.4 6.5 6.2 9.4 -0.9 4.3Renmin-Donghou 34.2 39.4 77.9 2.4 7.1 16.3 14.5 19.3 -2.0 2.9Donghou_Qingnian 34.2 39.4 77.9 2.4 7.1 20.4 16.2 20.6 -3.8 2.4Qingnian-Hongshan 28.0 34.2 70.1 3.4 7.4 31.7 30.3 40.7 -0.8 3.0Hongshan-Xihong 43.3 53.6 90.9 3.6 5.4 8.9 6.5 13.7 -5.0 7.7Xihong-Karamay E. 28.5 34.9 67.1 3.4 6.8 29.5 32.9 39.7 1.8 1.9KaramayiE.-XinYi 33.2 41.9 76.2 3.9 6.2 0.0 0.0 0.0 0.0 0.0Xinyi-Suzhou 30.7 39.1 66.4 4.1 5.4 0.0 0.0 0.0 0.0 0.0Nanhu-Hetan 32.5 40.0 51.7 3.5 2.6 0.0 0.0 0.0 0.0 0.0Hetan Crossing N. 33.1 38.0 46.0 2.3 1.9 0.0 0.0 0.0 0.0 0.0Hetan-Liyushan 43.3 45.2 59.6 0.7 2.8 0.0 0.0 0.0 0.0 0.0Liyushan-Tianjing 47.4 51.4 63.3 1.4 2.1 0.0 0.0 0.0 0.0 0.0Tianjing-Beijing 38.5 38.2 49.5 -0.2 2.6 0.0 0.0 0.0 0.0 0.0Beijing-Altay 22.5 23.3 38.0 0.6 5.0 0.0 0.0 0.0 0.0 0.0Attay-WoodPlant 31.2 42.7 55.5 5.3 2.6 0.0 0.0 0.0 0.0 0.0Note: italicised sections are arterial road standard
Economic Evaluation
For the economnic evaluation, the vehicle-trip model was developed into an integrated person-trip modelwhich had enhanced capabilities including use of a non-fixed trip matrix (reflecting features to capturegenerated demand and mode share function based on generalized cost). The evaluation focused on acomparison of the costs and benefits of the above mentioned Networks A* (do minimum/no project) and B(Ring Road). The augmented Network A* assumes that the Ring Road corridor would be widened to
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6-lanes in 2007 and that the Hetan Road/Karamay Road Interchange (a key interchange located at theintersection of two highways within the Ring Road) would be added to the Master Plan program. The costof widening the Ring Road corridor in Network A* would be avoided by the construction of the Ring Roadand is a benefit to the project. This benefit is conservatively assumed to be 10 percent of the cost of theRing Road project and appears as a negative cost in year 2007 of the evaluation.
To analyze traffic benefits against ring road investment and maintenance costs, a spreadsheet model wasdeveloped to calculate three cost-benefit indicators: EIRR; net present value (NPV) at 12 percent andmodified economic rate of return (MERR). The MERR assumes that project benefits would be reinvestedto yield only the marginal rate of return on public sector investment, which is assumed to be the testdiscount rate of 12 percent. The development of the person trip model, calibration data and the results ofthe network modeling are presented and discussed in the report "Second-Phase Model of UrumqiTransport Planning - Person Trip Model" SCCTPI, August 1999, which is available in the project files.
Economic Evaluation Results
The cost and revenue streams for the analysis of Network B compared with Network A' are summarized inthe tables below. The project EIRR is 20.2 percent and the MERR is 15.0 percent. The NPV for the totalproject (net benefits) is RMB 1.49 billion.
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Table 4.5: Economic Evaluation of Ring Road Investment
Economic Costs Total Economic Benefits Total NetVear Construction Maintenance Cost VOC P Benefit ReDefit2000 480 480 0 -4802001 359 359 0 -3592002 603 603 0 -603
2003 265 265 0 -265
2004 -2 -2 252 42 294 296
2005 -2 -2 263 50 312 3142006 -2 -2 274 58 332 3342007 -171 -2 -173 286 68 354 5272008 -2 -2 298 80 378 3802009 -2 -2 311 94 405 4072010 -2 -2 324 III 435 4362011 -2 -2 359 129 488 4902012 -2 -2 398 151 549 551
2013 58 58 441 177 618 5602014 -2 -2 489 207 696 6982015 -2 -2 543 241 784 7862016 -2 -2 602 282 884 8862017 -2 -2 667 330 997 9992018 -2 -2 739 386 1125 11272019 -2 -2 820 451 1270 12722020 -2 -2 909 527 1436 14372021 -2 -2 1007 616 1623 16252022 -2 -2 1117 720 1837 18392023 -563 58 -505 1238 842 2080 2585
EIRR 20.2%MIRR 15.0%
NPV(@12% 1489
Summary of Benefits and Costs:
Ring Road Benefits
The principal economic benefits of the Ring Road accrue to road users in the form of vehicle operating cost(VOC) savings from reduced traffic congestion and from journey time savings. These benefits aredistributed over the whole of the urban road network, as traffic will re-route in response to the additionalcapacity provided, increasing speeds in other areas.
Benefits from the Ring Road project will accrue from 2001, as some sections enter service, and willincrease significantly in both 2002 and 2003. However, as construction is primarily on existing alignment,substantial disbenefits during construction will need to be mitigated through traffic plans, as road capacitywill be lost and re-routings will have an impact on other parts of the network. Thus, the net benefit prior tofull opening in 2004 is likely to be small and benefits for 2001-2003 have been disregarded for theeconomic analysis.
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Distribution of Benefits
The Net Present Value of Benefits is RMB 2.70 billion and within this vehicle operating cost savings are2.5 times greater than travel time savings. The distribution of vehicle-trip based VOC benefits by class ofvehicle in 2004, 2010 and 2020 is given in Table 4.6-1 and the equivalent data for person-trip based traveltime benefits by mode is given in Table 4.6-2.
In 2004, 66 percent of VOC benefits are estimated to accmre to passenger vehicles, rising to 73 percent by2020. The majority of benefits accrue to cars and taxis as these modes account for 58 percent of VOCbenefits. It is assumed that transit vehicle VOC benefits (8.1 percent) accrue to transit operators (producersurplus). Travel-time benefits for individual person-trips are summed by mode in Table 4.5-2. While themajority of benefits is projected to accrue to car users (43%), almost a third of benefits is projected to berealized by public transport users (31%) in 2004. The higher shares of person-trip based public transporttravel time benefits compared with vehicle owner/operator based VOC benefits are attributable to the highpassenger vehicle occupancies of buses compared with other types of vehicles. Benefits to pedestrians andcyclists were not estimated quantitatively for the Ring Road investment, but were evaluated separatelyunder complementary traffic management investments (see below).
The annual rate of increase in VOC benefits is 4.3 percent for the period 2004 - 2010, rising to 10.9percent for 2010 - 2020, as congestion worsens on Network A*. Time benefits grow more quickly as thevalue of time savings is also increasing. Benefits increase at annual rates of 17.3 percent from 2004 - 2010and 16.9 percent from 2010 - 2020.
Table 4.6- 1: Vehicle-trip Based VOC Benefits by Vehicle Type
Growth % p.a.Vehicle 2004 2010 2020 2004- 10 2010 - 20
Benefit Rmb'000/day:Car 257 363 1321 5.9 13.8Taxi 245 267 624 1.4 8.9Coach 37 51 185 5.7 13.7Minibus 8 5 12 -9.4 10.1Bus 25 31 147 3.4 17.0Sub-Total Pass. 573 716 2289 3.8 12.3LGV 188 238 557 4.0 8.9HGV 108 164 288 7.3 5.8Sub-Total Goods 295 402 845 5.2 7.7Total 868 1117 3134 4.3 1 0.9
Share of Benefits in %:Car 29.7 32.5 42.2 1.5 2.6Taxi 28.3 23.9 19.9 -2.8 -1.8Coach 4.2 4.6 5.9 1.3 2.6Minibus 1.0 0.4 0.4 -13.1 -0.7Bus 2.9 2.7 4.7 -0.8 5.5Sub-Total Pass. 66.0 64.1 73.0 -0.5 1.3LGV 21.6 21.3 17.8 -0.3 -1.8HGV 12.4 14.7 9.2 2.9 -4.6Sub-Total Goods 34.0 35.9 27.0 0.9 -2.8Total 100.0 10D.0 100.0 0.0 0.0
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Table 4.6-2: Person-trip Based Travel Time Benefits by Mode
Growth % p.a.Vehicle 2004 2010 2020 2004- 10 2010 - 20
Benefit Rmb'000/day:Car 63 185 947 19.6 17.8Taxi 37 81 286 14.3 13.4Coach 16 39 238 15.6 19.7Bus/Minibus 30 76 346 16.8 16.4Total 146 381 1817 17.3 16.9
Share of Benefits in %:Car 43.2 48.4 52.1 1.9 0.7Taxi 25.0 21.3 15.7 -2.6 -3.0Coach 11.3 10.3 13.1 -1.5 2.4Bus/Minibus 20.4 19.9 19.0 -0.4 -0.5Total 100.0 100.0 100.0 0.0 0.0
Ring Road Costs
The financial costs for each component of the project and main sub-components (estimates as of 20October 1999) and their percentages of total cost are given in Table 4.7. Costs are shown in both RMBand US dollars, at an assumed exchange rate of US$1.00 = RMB8.30. Costs are at estimated out turnprices, including price contingency from the 1999 base prices. Interest during the construction period isalso included in the costs. For the Ring Road, interest is allocated to each section.
Table 4.7: Ring Road Financial Costs
Financial Cost % ofRmb mill. US$ mill. Proiect
Al Road Network - Rina Road 1902.4 229.2 86.2Al-1 SE: Tuanjie-Karamaji E (7.20km) 736.3 88.7 33.4A1-2 NE: Karamaji E-Wuchan Highway (10.18km) 316.3 38.1 14.3A1-3 N: Wuchan Highway-Wumin (4.05km) 143.7 17.3 6.5A1-4 W: Wumin-Xishan (2.26km) 137.2 16.5 6.2A1-5 SW: Xishan-Qiantangjiang (8.51 km) 569.0 68.5 25.8
The cost estimate for the whole Ring Road has been reduced by RMB 44.5 million, (the cost of theWuchang Interchange which was withdrawn from the project), to be funded as part of the AirportExpressway link. This interchange represents 2.3 percent of the total cost of the Ring Road and its benefitscannot easily be evaluated separately, it was therefore decided that the cost and benefits would be includedin the Ring Road econornic analysis.
Economic costs have been derived from financial costs by excluding the following:* interest payable during the construction period* price contingency* working capital during the construction period
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No shadow price has been applied to labor costs, as the skill levels required for this project are notconsidered to be in surplus supply in Urumqi, which has a relatively isolated labor market. Local marketprices have been used to estimate materials costs. In accordance with Government regulations fordeveloping the financial costs for public sector projects, value added tax and all other taxes are excludedfrom these cost estimates and no adjustment is required to develop the economic costs. For the isolatedmarket of Urumqi, materials costs are considered to represent economic costs. The land acquisition costsreflect resettlement costs only and are used unadjusted to represent economic costs.
Construction of the Ring Road was originally planned to be phased over the period 1999 to 2003.However, actual start of construction was delayed until April 2000, and the economic analysis reflects thisschedule. Apart from this adjustment, costs by year have been allocated in accordance with the plannedconstruction schedule.
The economic costs (in RMB 1999 million) and the construction segments in each year are as follows:
Economic As % ConstructionYear Cost of Total Se_ments
2000 480.1 28.1 3,4,5(1999),1,2,6,7(50%)2001 359.7 21.0 8,9,11,7(50%)2002 603.3 35.3 10, 12 -172003 265.9 15.5 18-21Total 1707.2 100.0 1-21
The economic cost, excluding Wuchang Interchange, is RMB 1664 million, representing 87.5 percent ofthe financial cost of RMB 1902 million.
Traffic Results
Traffic congestion on the main roads will decrease following construction of the project, to the benefit ofbuses and other road users. Table 4.8 presents motorized traffic conditions (traffic volumes andvolume/capacity ratios) in 2010 with and without the Project:
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Table 4.8: Main Road 2-way Daily Volumes and Volume/Capacity Ratios
Road Segment W/o proj. V/c ratio With V/ctraffic proj. ratio
trafficAlaty Suzhou---Xinyi 53969 1.12 35886 0.75
Xiyi---Karamy 55520 1.16 39845 0.83Karamy---Xihong 62616 1.30 45155 0.94
Beijing Suzhou---Xinyi 47384 0.99 37779 0.79Liyushan Suzhou---Xinyi 12768 0.80 10538 0.66Youhao Xinyi---Karamy 33361 0.70 30091 0.63
Karamy---Xihong 34912 0.73 30356 0.63Xihong---Guanming 46080 0.96 39732 0.83
Yangzijiang Guangming--Heilongjiang 28400 0.59 24037 0.50Changiang Heilongjiang---Qiantangjiang 30318 0.63 27195 0.57Xinhua Guangming---Heilongjiang 27977 0.87 25442 0.80
Heilongjiang---Qiantangjiang 24814 0.78 22654 0.71Nanhu Karamy--Xihong 33812 0.70 27972 0.58Xinming YXihong---Qingnian 34190 0.71 32626 0.68Jiefang Heilongjiang---Qiantangjiang 13364 0.84 12675 0.79Xinyi Youhao---Hetan 40755 1.27 29414 0.92Kararny Guojing---Alaty 27561 0.57 23108 0.48
Hetan---Nanhu 23367 0.49 15395 0.32Xihong Baoshan---Hetan 61045 1.27 45162 0.94_________ Hetan ---Nanhu 42471 0.88 35378 0.74
Guangming Xinhua---Jiefang 44132 1.38 38799 1.21[Hongshan Xinhua---Jiefang 12819 0.40 7337 0.23
Main Assumptions:
Benefits
Vehicle Operating Costs. The modeled link traffic volumes, speeds and volume/capacity (v/c) ratios wereused to calculate the total VOC of each network. This was calculated for vehicle types: car, light goodsvehicle (LGV), heavy goods vehicle (HGV) and bus. The World Bank's HDM-3 VOC modei was applied,calibrated by the World Bank on 1999 base cost data representative of the Urumqi vehicle fleet. Operatingcost was related to operating speed (s) and to the link v/c ratio by the following equation:
C = a + b(l/s)(1+0.2(v/c))2 where:
a and b are estimated parameters ands = link speed and v/c = link vehicle/capacity ratio
Value of Time. The economic value of travel time savings comparing networks was calculated,differentiating between time on work trips and non-work trips in order to apply an "equity value of time"
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based on national figures to the valuation of non-work trips. Work trips were valued at the Urumqi hourly
wage rate, increased by 33 percent to allow for overhead costs. Non-work trips (including commute trips)
were valued in relation to national urban household income per employed person per hour, with trips by
adults valued at 30 percent of this figure and trips by children at 15 percent. Child trips were estimated to
account for 20 percent of non-work trips. The time values for 1997 (the latest available data) were
increased to modeled years by forecast national real GDP per capita growth over the period.
The proportion of work trips was developed from the modeled trip purpose distribution for 2010. It was
assumed that half of non home-based trips would be for work. The proportion of non home-based trips
varies significantly between bus and non-bus modes; for bus, it was 10 percent of trips while for cars and
taxis combined, it was 25 percent of trips. Separate time values were therefore calculated for each of these
categories. The time values in modeled years for bus trips and other trips are given below:
Trip Tvye 1997 2004 2010 2020RMB 1997/hour)
Work 5.59 8.52 11.88 19.92Non-Work 1.27 1.94 2.70 4.53
CompositeBus n.a. 2.22 3.09 5.18Car/Taxi n.a. 2.52 3.51 5.89
Time savings for bus passengers were based on buses achieving 60 percent of the increase in link speeds
resulting from the project.
Expansion Factor. The daily VOC and time benefits as modeled represent typical summer weekdays.Urumqi has a quite severe winter, with the mean temperature falling to -15C in February, when traffic
volumes and project benefits will be lower than in summer. The typical expansion factor from weekday toannual benefits of around 330 is thus considered too high. A figure of 290 has been assumed, based on
100% valuation of traffic levels during the summer months (330 x 50% x 100%=165) and approximately75% valuation of traffic during the winter months (330 x 50% x 75% = approximately 125 days).
Costs
Terminal Value. The Ring Road investment will have a continuing economic value after the end of the
analysis period in 2023. This has been represented by including a benefit in the final year equal to
one-third of the total initial investment.
Maintenance Costs. The Ring Road is being constructed predominantly on existing alignment. The onlyexceptions are the tunnel section and the new eastern link. The whole alignment will be brought up to "as
new" standard, including existing road sections at-grade and beneath elevated sections. These sections
would otherwise have required maintenance based on their pre-existing conditions. A model of
maintenance expenditure on the Urumqi urban network (by class of road) was used to establish average
expenditures based on the pre-existing condition for the alignment compared with "as new" expenditures,
including work required on new Ring Road sections. This shows that total network maintenance
expenditure will be slightly reduced by construction of the Ring Road, except in years when major
maintenance is programmed for the Ring Road. This is assumed to be required in years 2013 and 2023 at
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an economic cost of RMB 60 million per year.
Sensitivity analysis / Switching values of critical items:
Ring Road Sensitivity Analysis. Reflecting possible risks in accuracy of valuations, implementation andpolicy, five sensitivity tests were applied to the Ring Road analysis to confirm the robustness of the project:
Test 1: increasing construction costs by 20 percentTest 2: reducing VOC and time benefits by 20 percentTest 3: both increasing costs and reducing benefits by 20 percentTest 4: disregarding all time benefitsTest 5: slower economic growth, with forecast GDP in 2015 not achieved until 2020 (average
annual growth in Urumqi GDP for 2004-2020 falls from 6.2 to 4.4 percent)
For Test 5 the benefits in the base case in 2015 were assumed not to be attained until 2020, with the loss ofbenefit phased in over the period 2004 - 2020. The results of all the sensitivity tests are given below:
RMB billionTest EIRR MIERR NPV
Base 20.2 15.0 1.491 18.1 14.1 1.252 17.6 13.9 0.953 15.7 13.1 0.714 16.8 13.4 0.735 17.5 13.6 0.79
Ring Road Switching Values. Switching values and the probability of the switching values applying inpractice have been determined. A switching value is defined as that which would reduce the NPV at 12percent to zero and result in an EIRR of 12 percent. The switching value for Ring Road construction costis +130 percent. The probability of such a cost increase is considered to be negligible and certainly wellbelow 5 percent. The switching value for VOC benefits is -78 percent. Again, the probability of benefitsfalling so far short of the modeled level is considered to be slight and under 10 percent. The EIRR is above12 percent with time benefits reduced to zero and there is no positive switching value for time benefits.Negative time benefits have a zero probability.
Economic Analysis of Other Project Components. The Ring Road accounts for approximately 85percent of the project's economic cost. The institutional development and environmental componentstogether account for approximately 5 percent and 3 percent is accounted for by maintenance measures andfunds held in reserve pending the results of the bus network optimization study. Remaining items accountfor 7 percent. Of these, the benefits of ATC and signalization, junction channelization, the one-waysystem, and public transport wireless communication system have been estimated. Insufficient data areavailable on the benefits of bus priority, pedestrian improvement, enforcement and road user education, andother safety measures for reliable cost benefit analysis.
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Traffic Management
ATC and Signalization Benefits. These will reduce wasted green time at traffic lights, reducing thenumber of stops and delays. It is assumed that on average the proportion of vehicles stopping will bereduced from 50 to 45 percent, with an average time saving per set of lights of 2 seconds per vehicle.Corresponding savings in VOC are estimated at RMB 0.1. The project measures are also assumed toreduce vehicle accidents by 1.5 percent and pedestrian accidents by 0.75 percent. The initial year'sbenefits from the investment of RMB 23.5 million based on 2004 traffic volumes are as follows:
RMB millionItem Benefit
Passenger time 2.52VOC savings 1.95Accident reduction 0.04Total 4.51
Accident reduction benefits are based on local valuation reflecting property damage only, althoughnon-quantifiable personal safety benefits (including reduced fatality rate) will accrue to pedestrians andother road users. The first year rate of return is a relatively high 19 percent.
Junction Channelization Benefits. Channelization will result in more disciplined traffic flow atintersections. The average benefit per vehicle per site is assumed to be the same as for ATC andsignalization. The initial year's benefits from the investment of RMB 10.0 million at 21 intersections areas follows:
RMB millionItem Benefit
Passenger time 0.84VOC savings 1.29Accident reduction 0.04Total 2.17
The first year rate of return is 22 percent.
One-Way System Benefits. A one-way system in the central area will increase capacity at intersectionsand improve the operating performance of the network in the area. The pairs of roads evaluated are:Jiefang/Jiankang-Heping/Minzhu and Zhongshan. It is assumed that journey times would be reduced by 50percent on the affected sections, with VOC reduced by 5 percent. One-way systems may increaseaccidents, particularly in the initial period of operation, unless measures are taken to provide alternativecrossing facilities for pedestrians. However, the economic cost of additional accidents would be relativelyslight compared with the benefits. The first year's benefits from the investment of RMB 10.2 million areestimated to be as follows:
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RMB millionItem Benefit
Passenger time 2.60VOC savings 0.35Total 2.95
The first year rate of return is 29 percent.
Increase in Benefits 2004-2010. The combined impact of the above three measures was modeled for2004 and 2010. The annual growth rate of economic benefits over the period was 5.7 percent.
Public Transport
Computerized Information System. The UPTC has relatively few computers, and most are old 386models. Most tasks are still handled manually. A computerized information management system isproposed which would include vehicle inventories and maintenance records, spare parts inventories,equipment inventories, vehicle maintenance scheduling, and accounting, payroll, and financial reporting.The system should also allow for capability to include centralized vehicle scheduling and dispatch at afuture date. Workstations would be provided at each bus company unit, linked via an on-line network to amain server at headquarters. Software would be required for database management, statistical analysis,finance management, vehicle technical management, material supply & warehouse management, andpersonnel management. At an estimated cost of RMB 1.94 million, the proposed system would consist ofnetwork severs, PCs including a laptop, and other equipment including scanners, printers, and faxmachines.
Comprehensive training will be required to ensure appropriate use of the system, including feedback intoimproving management methods. Current annual administration wage costs total some RMB 7 million andmaterials inventories are estimated at RMB 5 to 10 million (based on a tumover of RMB 30 million). A5% reduction in these costs would yield an intemal rate of return of 22%, assuming a 5-year economic life.
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Annex 5: Financial Summary
CHINA: Urumqi Urban Transport Improvement Project
Years EndingUSD $ million
Year I Year 2 T Year 3 1 Year4 I Year 5 Year 6 Year 7Total Financing RequiredProject CostsInvestment Costs 0.0 50.2 63.8 79.7 46.0 0.0 0.0Recurrent Costs 0.3 2.5 2.8 2.3 2.4 0.0 0.0
Total Project Costs 0.3 52.7 66.6 82.0 48.4 0.0 0.0Interest during 0.0 1.0 2.0 4.0 6.0 6.0 0.0
constructionFront-end fee 0.0 1.0 0.0 0.0 0.0 0.0 0.0
Total Financing 0.3 54.7 68.6 86.0 54.4 6.0 0.0
FinancingIBRDIIDA 0.0 11.1 23.2 31.6 26.3 7.8 0.0Government 0.3 43.7 45.3 54.4 20.3 6.0 0.0
Central 0.0 0.0 0.0 0.0 0.0 0.0 0.0Provincial 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Co-financiers 0.0 0.0 0.0 0.0 0.0 0.0 0.0User Fees/Beneficiaries 0.0 0.0 0.0 0.0 0.0 0.0 0.0Others 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Project Financing 0.3 54.8 68.5 86.0 46.6 13.8 0.0
Main assumptions:
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Table 1: Municipal FinancesSummary of Fiscal Capacity Analysis
(RMB million)
1999 2000 2001 2002 2003 2004 TotalMunicipal Fiscal Revenue(MFR) 3152.14 3404.31 3676.66 3970.79 4288.45 4631.53 23123.88Effective Fiscal Capacity 2082.53 2228.31 2384.29 2551.19 2729.77 2920.85 14896.94Project counterpart Fund 2.6 355.3 371.6 441.6 130.9 1302Interest During construction 8.3 16.6 33.2 49.8 49.8 157.7Total Counterpart Fund 2.6 363.6 388.2 474.8 180.7 49.8 1459.7Percentage of MFR 0.1% 10.7% 10.6% 12.0% 4.2% 1.1% 6.3%Percentage of Fiscal Capacity 0.1% 16.3% 16.3% 18.6% 6.6% 1.7% 9.8%°
Table 2: Municipal FinancesBudget Sources for Counterpart Funds
(RMB million)
1999 2000 2001 2002 2003 2004 TotalNew Road Investment Budget 205.75 231.3 257.9 285.7 314.1 344.1 1638.85Housing Construction Budget 236.47 248.29 260.7 273.73 287.42 301.79 1608.4Total 442.22 479.59 518.6 559.43 601.52 645.89 3247.25Total Counterpart Funds 2.6 363.6 388.2 474.8 180.7 49.8 1459.7Surplus/Deficit 439.62 115.99 130.4 84.63 420.8a 596.09 1787.55Counterpart Funds as% of Housing Constructionand New Road Investment 1% 76% 75% 85% 30% 8% 45%
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Annex 6: Procurement and Disbursement Arrangements
CHINA: Urumqi Urban Transport Improvement Project
Procurement
Procurement Capacity Assessment of Implementing Agencies
I . The already established Project Executive Office (PEO) will be responsible for the procurementactivities of all components. The Urumqi Urban Transport Improvement Project (WUTIP) is the firstWorld Bank financed project to be implemented by the PEO. The regional and municipal governments willprovide full support to the project through the Urban Construction Commission. Thus far, the procurementof consultant services under the project is satisfactory. The PEO has gradually accumulated experience inWorld Bank financed projects through project preparation and through procurement activities associatedwith early construction of a section of the Ring Road under retroactive financing. As a govermnentorganization, the PEO has been fully authorized to implement the project. The responsibility and ethicscode for each level of the agency and its staff has been spelled out in their job description.
2. With the assistance of an experienced procurement agent and of the regional highway agency,regional and municipal constnrction commissions, foreign and local consultants and design institutes, thePEO is expected to fulfill its procurement function and administer procurement in an efficient andtransparent manner. The PEO has given a commitment that the World Bank's procurement policies, rulesand guidelines will be strictly followed. In cases where there are discrepancies between local policy andWorld Bank's requirement, the World Bank's policy will govern for the World Bank financed contracts.Tlhere is no integrated national procurement law in China and the bidding law is effective from January 1,2000. Overall, the risks in the procurement process are rated as average.
3. In the regulations and administrative procedures issued by the central and local governments forNational Competitive Bidding (NCB) using local funds, there are some inconsistencies with World Bankrequirements. The main inconsistencies are the use of bracketing and the merit point system inprequalification, bid evaluation and contract award for locally funded NCB civil works contracts. Theywill be waived in favor of World Bank NCB procedures in a supplemental letter to the Loan Agreement. Inthis letter, Urumqi agrees to pay particular attention to ensure that the following procedures are followedwith respect to NCB procurement:
(a) all invitations to pre-qualify or to bid shall be advertised in a newspaper of national circulationin the Borrower's country;
(b) such advertisement shall be made in sufficient time for prospective bidders to obtainprequalification or bidding documents and prepare and submit their responses; and in any event aminimum of 30 days shall be given to bidders between the date of advertisement in such newspaperand the deadline for submission of bids, and the advertisement and bidding documents shall specifythe deadline for such submission;
(c) qualification requirements of bidders and the method of evaluating the qualification of eachbidder shall be specified in detail in the bidding documents;
(d) all bidders shall be required to provide security in an amount sufficient to protect Urumqi incase of breach of contract by the contractor, and the bidding documents shall specify the requiredform and amount of such security;
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(e) the time for opening of all bids shall be the same as the deadline for receipt of such bids;
(f) all bids shall be opened in public; all bidders shall be afforded an opportunity to be present(either in person or through their representatives) at the time of bid opening, but bidders shall notbe required to be present at the bid opening;
(g) no bid may be rejected solely on the basis that the bid price falls outside any standard contractestimate, or margin or bracket of average bids established by Urumqi; and
(h) each contract shall be awarded to the lowest evaluated bidder, that is to say, the bidder whomeets the appropriate standards of capability and resources and whose bid has been determined (i)to be substantially responsive to the bidding documents and (ii) to offer the lowest evaluated cost.The winning bidder shall not be required, as a condition of award, to undertake responsibilities forwork not stipulated in the bidding documents or otherwise to modify the bid as originallysubmitted.
Procurement methods (Table A)
4. Procurement will be carried out as shown in Table A. Arrangements have taken into account theWorld Bank's "Guidelines for Procurement under IBRD Loans and IDA Credit" (January 1995, andrevised in January, August 1996, September 1997 and January 1999) and Guidelines: Selection andEmployment of Consultants by World Bank Borrowers" (January 1997, and revised in September 1997and January 1999) as well as the experience gained from previous World Bank-financed urbantransportation projects. The documentation for procurement, which covers International CompetitiveBidding (ICB) and National Competitive Bidding (NCB) for civil works and goods was standardized forChinese conditions by the Chinese government and the World Bank on the basis of model documents whichwill be used for all relevant procurement processes under the project. Where no model documents exist,World Bank standard documents, such as the Standard Prequalification Document (SPD) forpre-qualification of contractors (September 1999, revised March 2000) and the Standard Request forProposals for the selection of consultants, etc. would be used. As noted above, inconsistencies with WorldBank requirements in domestic NCB procedures will be waived in favor of World Bank NCB procedures ina supplemental letter to the Loan Agreement.
Works (US$160 million)
5. Civil works for the Ring Road are divided into 21 contracts, with an average size of US$8.3million for ICB contracts, and US$4.4 million for NCB contracts. Pre-qualification of contractors isrequired for ICB works contracts, but is not mandatory for NCB contracts.
6. International Competitive Bidding (ICB) (US$116.3 million). Fourteen contracts out of 21 civilworks contracts for the Ring Road will be procured with ICB procedures with an estimated cost ofUS$116.3 million. These contracts will be bid on a slice and package basis; qualified firms will be allowedto bid for more than one contract so as to attract international and large Chinese contractors. Contractorsfor ICB contracts for civil works will be pre-qualified. The General Procurement Notice (GPN) for theproject was published in UN Development Business No. 518 on September 16, 1999. SpecificProcurement Notices (SPN) for the initial civil works contracts for the Ring Road and consulting servicesrequired to supervise these contracts were published in UN Development Business No. 522 on November16 and No. 523 on November 30, 1999, respectively. For the remaining civil works contracts for Ring
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Road, invitations to bid will be advertised as specific procurement notices in UN Development Businessand well-known technical magazines, newspapers, and trade publications of wide international circulation.
7. National Competitive Bidding (NCB) (US$39.8 million). Other works, including 7 Ring Roadpackages (US$30.6 mnillion), road network improvements (US$2.8 million), and the traffic managementprogram (US$2.9 million) and bus priority lanes (US$3.5 million) will be awarded following NCBprocedures acceptable to the World Bank. These works will involve contracts estimated to cost less thanUS$10 million each. Since these contracts will be small, scattered throughout the city and implementedover four years, ICB would neither be justified nor practical, but foreign firms will not be precluded frombidding.
8. Other - Force Account (US$3.9 million). Junction channelization (US$1.2 million) and RingRoad greening (US$2.7 million) will be implemented by force account. For junction channelization, theworks are small and scattered in location and timing, and the works have to be constructed outside peaktravel times so as not to disrupt traffic. For Ring Road greening, the quantities of work involved cannot bedefined in advance. The works are small and scattered, and the works have to be done by special localgreening teams who know both the local climate and tree-planting in this special dry area. All items inthese two sets of works will be financed on an output basis, that is contracts will be paid against result ofworks carried out.
Equipment (US$26.5 million)
9. International Competitive Bidding (ICB) (US$19 million). Contracts for goods and equipmentof more than US$200,000 equivalent up to a total amount of US$19 million will be awarded under ICB.Domestic manufacturers competing under ICB will be eligible for a margin of preference in the comparisonof bids of 15% for goods, or the prevailing customs duties, whichever is lower. ICB goods contracts aremainly for: road maintenance equipment for both the Ring Road and other roads, pavement managementequipment, ATC facilities, other non Ring Road junction signal control facilities, and equipment for thetraffic command center, driver/vehicle management system, bus computer information system, vehiclemonitoring system, and the Inspection/Maintenance system.
10. National Competitive Bidding (NCB) (US$200,000). Items or groups of items estimated to costbetween US$50,000 and US$200,000 per contract package, with an aggregate amount not exceeding US$200,000 would be procured following NCB. NCB will be used to procure equipment for a wirelesscommunication system, the vehicle pollution research center, and offices.
11. International Shopping (IS) (US$400,000). Items or groups of items estimated to cost less thanUS$200,000 per contract package, with an aggregate amount not exceeding US$0.4 million will beprocured following international shopping procedures on the basis of comparison of price quotationssolicited from at least three suppliers from two countries eligible under the World Bank Guidelines forProcurement. International Shopping will be used to procure road safety equipment.
12. National Shopping (NS) (US$1.8 million). Items or groups of items estimated to cost less thanUS$50,000 per contract package, with an aggregate amount not exceeding US$ 1.8 million, will beprocured following local shopping procedures on the basis of comparison of price quotations solicited fromat least three suppliers under the World Bank Guidelines for Procurement. National shopping will be usedto procure items including evaporative coolers, bus spare parts, and project office equipment.
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Consultants (US$2.4 million)
13. All consultants required for supervising construction, for environmental monitoring, for trainingstaff, and for providing technical assistance and carrying out studies will be selected and employed underterms and conditions acceptable to the World Bank according to Guidelines on the "Selection andEmployment of Consultants by World Bank Borrowers," dated January 1997, revised in July 1997 andJanuary 1999. For consultant services, the Standard Request for Proposals, dated July 1997 and revised inApril 1998 and July 1999, will be used. Services from firms to total value of US$1.1 million will beselected through Quality and Cost Based Selection (QCBS). Services from individual consultants to a totalvalue of US$0.7 million will be selected on the basis of their qualifications (CQ). All selected consultantswill conform to eligibility requirements identified in the guidelines. All contracts for consultant servicesabove US$200,000 or equivalent will be advertised as specific procurement notices in UN DevelopmentBusiness and well-known technical magazines, newspapers, and trade publications of wide internationalcirculation.
Training (US$1.3 million)
14. The agreed training program is set out in the Project Implementation Plan. Training will includelocal and international study tours, attendance at training courses offered commercially as well as specificpurpose classroom and on the job training for staff of implementing agencies. Procurement will include amixture of prudent shopping, appointment of individual consultants on the basis of their qualifications, andpossibly ICB. The amounts in each category have not been deternined at this time.
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Procurement methods (Table A)
Table A: Project Costs by Procurement Arrangements(US$ million equivalent)
Procurement MethodExpenditure Category ICB NCB Mthod' N.B.F. Total Cost
1. Works 116.30 39.80 3.90 0.00 160.00
(55.80) (19.10) (1.90) (0.00) (76.80)2. Goods 19.00 0.20 2.20 5.10 26.50
(16.90) (0.20) (2.00) (0.00) (19.10)3. Services 0.00 0.00 3.10 0.60 3.70
(0.00) (0.00) (3.10) (0.00) (3.10)4. Miscellaneous 0.00 0.00 0.00 59.80 59.80
(0.00) (0.00) (0.00) (0.00) (0.00)5. Interest during 0.00 0.00 0.00 19.00 19.00construction
(0.00) (0.00) (0.00) (0.00) (0.00)
6. Front-end fee 0.00 0.00 1.00 0.00 1.00(0.00) (0.00) (1.00) (0.00) (1.00)
Total 135.30 40.00 10.20 84.50 270.00(72.70) (19.30) (8.00) (0.00) (100.00)
" Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingencies
2 Includes civil works by force account, goods to be procured through shopping, consulting services,training, technical assistance services and the front end fee.
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Table Al: Consultant Selection Arrangements (optional)(US$ million equivalent)
Consuttant Selection MethodServices
Expenditure QC:S QBS SFB LCS CQ Other N.B.F. Total CostCategory __ _ _ __ _ _ __ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
A. Firms 1.10 0.00 0.00 0.00 0.00 0.00 0.60 1.70(1.10) (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) (I .10)
B. Individuals 0.00 0.00 0.00 0.00 0.00 0.70 0.00 0.70(0.00) (0.00) (0.00) (0.00) (0.00) (0.70) (0.00) (0.70)
Total 1.10 0.00 0.00 0.00 0.00 0.70 0.60 2.40(1.10) (0.00) (0.00) (0.00) (0.00) (0.70) (0.00) (1.80)
1\ Including contingencies
Note: QCBS = Quality- and Cost-Based SelectionQBS = Quality-based SelectionSFB = Selection under a Fixed BudgetLCS = Least-Cost SelectionCQ = Selection Based on Consultants' QualificationsOther = Section V of Guidelines, Selection and Employment of Consultants by World BankBorrowers
N.B.F. = Not Bank-financedFigures in parenthesis are the amounts to be financed by the Bank Loan.
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Prior review thresholds (Table B)15. Prior review procedures will be used for:
(a) civil works contracts with an estimated cost of US$2 million or more (a total of
US$46.9 million); and(b) equipment with an estimated cost of more than US$200,000 per contract (a total of US $19
million).
16. This will apply to 92% and 89% of the total contract values of works and goods financed by the
World Bank, respectively. For contracts below the above-mentioned limits, post-review procedures would
be followed. All consultant contracts, terms of reference and single-source selections, regardless of the
value of the contract, will be subject to prior review. The sampling ratio for contracts not subject to prior
review is 14% for goods contracts.
Table B: Thresholds for Procurement Methods and Prior Review'
Contract Value Contracts Subject toThreshold Procurement Prior Review
Expenditure Catg (US$ ruds) Method (US$ mil_n1. Works 2,000 ICB 116.3
NCB 30.62. Goods 200 ICB 19
3. Services for Firms 100 QCBS 1.14. Services for 50 Section V of the guidelines 0.7Individuals for consultants selection
5. Single Source 0 SS 06. Miscellaneous - 0 Various 1.3Training
Total value of contracts subject to prior review: $169 million
Overall Procurement Risk Assessment
Average
Frequency of procurement supervision missions proposed: One every 4 months (includes specialprocurement supervision for post-review/audits)This frequency (every 4 months) applies for the first three years of the project, thereafter every 6 months.
Thresholds generally differ by country and project. Consult OD 11.04 "Review of ProcurementDocumentation" and contact the Regional Procurement Adviser for guidance.
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Disbursement
Allocation of loan proceeds (Table C)
Table C: Allocation of Loan Proceeds
Expenditure Category Amount in US$million Financing PercentageCivil Works 69.80 48
Goods/Equipment 17.70 100% of foreign expenditures, 100% oflocal expenditures (ex-factory cost)
and 75% of local expenditures for otheritems procured locally
Consultant Services and Training 3.00 100% of total expenditures
Unallocated 8.50 _
Total Project Costs 99.00Interest during construction 0.00
Front-end fee 1.00
Total 100.00
Use of statements of expenditures (SOEs):
17. Withdrawal from the loan account will be made on the basis of SOEs for:(a) civil works in contracts of less than US$2.0 million,(b) goods in contracts of less than US$200,000,(c) services provided by consulting firms in contracts of less than US$100,000,(d) services provided by individual consultants in contracts of less than US$50,000, and(e) training.
Special account:18. To facilitate disbursements, a special account will be opened with an authorized allocation of US$8million equivalent, the estimated average expenditures for a four-month period.
Retroactive financing:
19. Retroactive financing of up to US$9.0 million may be applied to expenditures made after March2000 for the procurement of the three NCB, four ICB year I Ring Road civil works contracts, andconsultant services for construction supervision.
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Annex 7: Project Processing Schedule
CHINA: Urumqi Urban Transport Improvement Project
Project Schodule Planned ActualTime taken to prepare the project (months) 32 33
First Bank mission (identification) 07/05/97 07/05/97
Appraisal mission departure 11/15/99 01/10/2000
Negotiations 02/21/2000 03/20/2000Planned Date of Effectiveness 03/22/2001
Prepared by:
Urumqi Municipal GovernmentProject Executive Office
Preparation assistance:
Japanese PHRD Grant, Canadian Consultant Trust Fund, Japanese Consultant Trust Fund
Bank staff who worked on the project included:
I Name SpecialityEdward Dotson, EASTR Task Team Leader/ Urban TransportTilly Chang, EASTR Economics/ Urban TransportZong Yan, EACCF Urban Transport (Beijing Office)Peter Midgley, ISGKM Former Task ManagerIan Ferguson, EASTR Team AssistantWenyan Dong, EACCF Team Assistant (Beijing Office)OTHER TASK TEAM MEMBERSRichard Scurfield, EACCF Sector Coordinator (Beijing Office)Robert Scouller, EACIF Civil Engineering & Project Management (Jakarta Office)Daniel Gibson, EASES Social AnalysisHoi-Chan Nguyen, LEGEA LegalAnil Somani, EASES EnvironmentYang Dawei, EACCF Procurement (Beijing Office)Youhua Yu, EACCF Financial Management (Beijing Office)QUALITY MANAGEMENTChristopher Willoughby, TWUTD Urban InfrastructureHatim Hajj, EASTR Technical ReviewGerhard Menckhoff, LCSFT Urban TransportHennie Deboeck, EASTR Financial AspectsRobin Carruthers, EASTR Economics
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Annex 8: Documents in the Project File*
CHINA: Urumqi Urban Transport Improvement Project
A. Project Implementation Plan
Project Implementation Plan, December 1999
B. Bank Staff Assessments
Aide Memoire:1. Key Missions (July 1997, May 1998, July 1998, October 1998, February 1999
May 1999 Pre-Appraisal, August 1999, January 2000 Appraisal)2. Other Missions (March 1999, July 1999, November 1999, July 2000)
Procurement Assessment Capacity Report, February 2000Review of Financial Management System, November 1999Manual of Financial Administration, Bookkeeping Operation and Auditing, October 1999
C. Other
Feasibility Studies1. Inner-Ring Road in Urumqi Project Proposal, June 1996, English2. Project Identification Report on Outer-Ring Road of Urumqi, April 1997, English3. Project Introduction on Outer-Ring Road of Urumqi, June 1997, English4. Urumqi Travel Survey Analysis, January 1999, English5. Development, Research of Urumqi Transportation Planning Model and Network Testing
(Phase I), January 1999, English6. Feasibility Study Report on Outer Ring Road Project, April 1999, English7. Comprehensive Feasibility Study of UUTIP, July 1999, English
Each volume of the latter report covers a single project component: Road Network Improvement;Traffic Management and Road Improvements; Public Transport Improvement; EnvironmentalImprovement; and Institutional Development.
8. Planning of Traffic Circulation Organization (Inception Report), August 1999, English9. Option Study of Traffic Improvement Project in Urumqi City, September 1999, English10. Feasibility Study Report on Urumqi Outer Ring Road Project (Additional Information),
September 1999, English
Technical Assistance1. Final Report for Technical Assistance from Padeco Co., October 1998, English2. Final Report for Consultancy Services from Wilbur Smith Associates, October 1999,
English
Environmental Assessment1. Urumqi EAP (Section by Retroactive Finance in the Outer Ring Road), March 1999, English2. EA Summary Report, September 1999, Uygur, Chinese3. EIA, November 1999, English4. EAP, November 1999, English5. EIA Executive Summary, November 1999, English
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Resettlement Action Plan1. RAP for Retroactive Finance Section (draft), September 1999, English2. RAP Summary Report, September 1999, Uygur, Chinese3. Resettlement Information Booklet (RIB) for West Middle Section of the Outer Ring
Road, September 1999, Uygur, Chinese4. Announcement of Distribution of Resettlement Action Plan Summary Report
and Environmental Assessment Summary Report, September 1999, Uygur, Chinese5. RAP, January 2000, EnglishIncluding electronic files
- 71 -
Annex 9: Statement of Loans and CreditsCHINA: Urumqi Urban Transport Improvement Project
31-Jul-1 999Difference between expected
and actualOriginal Amount in US$ Millions disbursements
Project ID FY Borrower Purpose IBRD IDA Cancel. Undisb. Ong Frrn Rev'd
P040513 1996 China 2ND HENAN PROV HWY 210.00 0.00 0.00 157.51 78.51 0.00
P003619 1998 China 2NDINLAND WATERWAYS 123.00 0.00 0.00 115.63 34.31 0.00
P003652 1996 China 2ND SHAANXI PROV HWY 210.00 0.00 0.00 101.99 55.99 0.00
P057352 1999 China 4TH RURAL WATER SUPP 16.00 30.00 0.00 45.69 3.18 0.00
P051856 1999 China ACCNTG REFORM & DEV 27.40 5.61 0.00 30.98 10.19 0.00
P003559 1993 China AGRIC. SUPPORT SERVI 0.00 115.00 0.00 4.37 -3.88 0.00
P050036 1999 China ANHUI PROVINCIAL HWY 200.00 0.00 0.00 178.01 14.91 0.00
P003563 1999 China ANIMAL FEED 150.00 0.00 0.00 133.27 129.53 49.94
P049665 1999 China ANNING VALLEY AG.DEV 90.00 30.00 0.00 98.53 -0.51 0.00
P003646 1996 China CHONGQING IND POL CT 170.00 0.00 153.99 15.61 137.10 4.27
P036952 1997 China CN-BASIC ED. IV 0.00 85.00 0.00 23.90 -15.47 0.00
P036950 1996 China CN-BASIC ED. POOR III 0.00 100.00 0.00 1.03 -0.82 0.00
P003636 1995 China CN-BASIC EDUC IN POOR & MINORITY AREA II 0.00 100.00 0.00 0.99 2.84 0.00
P003566 1998 China CN-BASIC HEALTH 0.00 85.00 0.00 77.18 9.83 0.00
P003589 1996 China CN-DISEASE PREVENTION 0.00 100.00 0.00 40.65 44.66 0.00
P036953 1999 China CN-HEALTH IX 10.00 50.00 0. 00 58.97 3.86 0.00
P046051 1999 China CN-HIGHER EDUC. REFORM 20.00 50.00 0.00 64.39 8.47 0.00
P003624 1992 China CN-INFECTIOUS DISEASES 0.00 129.60 0.00 22.92 18.39 18.35
P034618 1996 China CN-LABOR MARKET DEV. 10.00 20.00 0.00 21.75 23.51 0.00P003634 1995 China CN-MATERNAL CHILD HEALT 0.00 90.90 0.00 12.53 15.30 0.00
P058308 1999 China CN-PENSION REFORM PJT 0.00 5.00 0.00 4.98 2.35 0.00
P003502 1994 China CN-RURAL HEALTH MANPOWER 0.00 110.00 0.00 12.60 10.72 0.00
P003635 1997 China CN-VOC. ED. REFORM PROJ 10.00 20.00 0.00 5.57 -0.96 0.00
P003653 1999 China CONTAINER TRANSPORT 71.00 0.00 0.00 70.29 40.09 0.00
P051736 1998 China E. CHINAIJIANGSU PWR 250.00 0.00 0.00 235.09 177.45 26.16
P003647 1995 China ECONOMIC LAW REFORM 0.00 10.00 0.00 5.22 5.76 0.00
P003606 1998 China ENERGY CONSERVATION 63.00 0.00 0.00 61.80 6.42 0.00
P003603 1995 China ENT. HOUSING SOC. SE 275.00 75.00 20.00 164.79 158.06 18.72
P060270 1999 China ENTERPRISE REFORM LN 0.00 5.00 0.00 4.98 2.68 0.00
P003632 1993 China ENVIRONMENT TECH ASS 0.00 50.00 0.00 9.25 9.67 5.81
P003507 1996 China ERTAN HYDRO II 400.00 0.00 0.00 12.69 -3.39 0.00
P003623 1993 China FINANCIAL SECTOR T.A 0.00 60.00 0.00 17.75 19.40 11.60
P036041 1995 China FISCAL & TAX REF. & 25.00 25.00 0.00 40.04 41.95 0.91
P003557 1994 China FOREST RESOURCE DEV 0.00 200.00 0.00 21.94 8.98 -36.45
P046952 1998 China FOREST. DEV. POOR AR 100.00 100.00 0.00 177.75 -1.09 20.41
P051705 1999 China FUJIAN II HWY 200.00 0.00 0.00 198.00 16.67 0.00P003626 1994 China FUJIAN PROV HIGHWAY 140.00 0.00 0.00 46.80 44.14 23.33
P003594 1996 China GANSU HEXI CORRIDOR 60.00 90.00 0.00 113.47 31.83 0.00
P003627 1993 China GRAIN DISTRIBUTION P 325.00 165.00 0.00 255.23 255.91 18.37P003518 1993 China GUANGDONG PROV. TRANSPORT 240.00 0.00 0.00 1.32 1.32 0.64
P036414 1998 China GUANGXI URBAN ENV. 72.00 20.00 0.00 88.11 10.63 0.00
P003814 1998 China GUANGZ. CITY CRT.TRP 200.00 0.00 0.00 142.92 30.58 0.00
P051888 1999 China GUANZHONG IRRIGATION 80.00 20.00 0.00 98.98 18.67 0.00
P056491 1998 China HEBEI EARTHQUAKE 0.00 28.40 0.00 0.43 -9.25 0.00
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Difference betweenexpected
Original Amount in US$ Millions and actualdisbursements'
Project ID FY Borrower Purpose IBRD IDA Cancel. Undisb. Orig Frn Rev'd
P003504 1994 China HEBEIIHENAN NATIONAL 380.00 0.00 0.00 16.22 16.22 0.00
P038988 1997 China HEILONGJIANGADP 120.00 0.00 0.00 68.06 11.80 0.00
P003581 1993 China HENAN PROV. TRANSPORT 120.00 0.00 0.00 6.55 6.55 0.00
P003602 1996 China HUBEI URBAN ENV. PRO 125.00 25.00 28.32 83.90 90.46 4.08
P035698 1998 China HUNAN POWER DEVELOP. 300.00 0.00 0.00 300.00 56.00 0.00
P003654 1997 China HUNANIGUANG HWY2-NH2 400.00 0.00 0.00 270.74 110.74 0.00
P049700 1998 China IAIL-2 300.00 0.00 0.00 249.28 36.05 0 00
P037156 1995 China ID-IODINE DEFICIENCY DISORDERS CONTROL 7.00 20.00 7.00 0.62 10.29 3.29
P003493 1995 China INLAND WATERWAYS 210.00 0.00 0.00 37.43 -0.37 0 00
P003598 1995 China LIAONING ENVIRONMENT 110.00 0.00 0.00 54 55 52.89 0.00
P041890 1999 China LIAONING URB TRANSP 150.00 0.00 0.00 141.50 24.50 0.00
P003540 1994 China LOESS PLATEAU 0.00 150.00 0.00 14.16 -18.59 0.00
P056216 1999 China LOESS PLATEAU II 100.00 50.00 0.00 146.92 23.14 0.00
P036949 1998 China NAT.HWY 3-HUBEI 250.00 0.00 0.00 206.61 14.95 0.00
P041268 1999 China NAT.HWY4-HUBEI/HUNAN 350.00 0.00 0.00 338.50 10.50 0.00
P003637 1997 China NATL RUR WATER III 0.00 70.00 0.00 59.21 22.89 11 87
P003590 1997 China QINBAMTS. POVIY RED 30.00 150.00 0.00 121.73 40.23 0.00
P003570 1993 China RAILWAY VI 420.00 0.00 0.00 46.97 46.97 -20 52
P003571 1995 China RAILWAYS VIl 400.00 0.00 29.00 319.34 254.34 33.27
P003595 1994 China RED SOILS II DEVELOP 0.00 150.00 0.00 30.88 18.79 0.87
P003592 1993 China REF. INST'L& PREINV 0,00 50.00 0.00 14.06 14.14 0.00
P046829 1999 China RENEWABLE ENERGY DEVELOPMENT 100.00 0.00 0.00 100.00 0.00 0 00
P003648 1996 China SECOND SHANGHAI SEWERAGE PROJECT 250.00 0.00 0.00 125.04 94.08 0.00
P003638 1996 China SEEDS SECTOR COMMER. 80.00 20.00 0.00 59.17 25.05 0.00
P040185 1998 China SHANDONG ENVIRONMENT 95.00 0.00 0.00 82.92 39.99 0 D0
P003586 1994 China SHANGHAI ENVIRONMENT 160.00 0.00 0.00 54.64 53.70 0.00
P044485 1997 China SHANGHAI WAIGAOQIAO 400.00 0.00 0.00 361.22 29.59 0.00
P003569 1996 China SHANGHAI-ZHEJIANG Hi 260.00 0.00 7.75 78.35 46.44 38.44
P003649 1996 China SHANXI POVERTY ALLEV 0.00 100.00 0.00 25.87 4.63 0.00
P003585 1995 China SHENYANG IND. REFORM 175.00 0.00 0.00 66.21 45.45 0.00
P003609 1994 China SICHUAN GAS DEV & CONSERVATION 255.00 0.00 0.00 87.60 62.10 0.00
P036947 1995 China SICHUAN TRANSMISSION 270.00 0.00 0.00 112.98 111.35 0.16
P043933 1999 China SICHUAN URB. ENV. I 150.00 2.00 0.00 152.02 3.34 0.00
P045264 2000 China SMALLHLDR CATTLE DEV 93.50 0.00 0.00 93.50 2.90 0.00
P003580 1993 China SO.JIANGSU ENVIRON. PROTECT. 250.00 0.00 0.00 3.25 2.32 0.00
P003593 1994 China SONGLIAO PLAIN ADP 0.00 205.00 0.00 14.37 -5.01 0.00
P003639 1995 China SOUTHWEST POV. REDUC 47.50 200.00 0.00 65.61 47.74 0.00
P003591 1998 China STATE FARMS COMMERCI 150.00 0.00 0.00 92.93 -9.53 0.00
P003539 1998 China SUST COAST RES DEV 100.00 0.00 0.00 83.68 2.02 0.00
P003597 1993 China TAIHU BASIN FLOOD CO 100.00 100.00 0.00 23.81 19.46 3.34
P046563 1998 China TARIM BASIN 11 90.00 60.00 0.00 130.53 23.84 0.00
P042299 1999 China TEC COOP CREDIT IV 10.00 35.00 0.00 44.46 -0.10 0.00
P003600 1995 China TECHNOLOGY DEVELOPME 200.00 0.00 0.00 93.39 58.63 0.00
P003633 1994 China TELECOMMUNICATIONS 250.00 0.00 30.00 13.80 43.80 3.74
P003616 1993 China TIANHUANGPING HYDRO 300.00 0.00 0.00 62.07 52.84 0.00
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Difference betweenexpected
Original Amount in US$ Millions and actualdisbursements
Project ID FY Borrower Purpose IBRD IDA Cancel. Undisb. Oriy Frm Revd
P003533 1993 China TIANJIN IND. 11 150.00 0.00 40.35 6.70, 12.28, 43.72 3.69
P003568 1992 China TIANJIN URB DEV & EN 0.00 100.00 0.00 320.00, 9.25 2.22
P056424 2000 China TONGEAI PUMPED STORA 320.00 0.00 0.00 196.47, 0.00 0.00
P045788 1998 China TRI-PROVINCIAL HWY 230.00 0.00 0.00 339.73. 52.31 0.00
P003650 1997 China TUOKETUO POWER INNER 400.00 0.00 24.00 285.48, 226.83 11.80
P036405 1997 China WANJIAZHAI WATER TRA 400.00 0.00 0.00 159.28, 63.48 0.00
P046564 1999 China WESTERN POVERTY RED 60.00 100.00 0.00 234.83, 0.25, 19.64 0.00
P034081 1997 China XIAOLANGDt MULTI. 11 430.00 0.00 0.00 22.64, 20.67, 128.93 0.00
P003562 1994 China XIAOLANGDI MULTIPURPOSE 460.00 0.00 0.00 211.52, 9.26, 4.78 0.00
P003644 1994 China XIAOLANGDI RESETTLEMENT 0.00 110.00 0.00 39.65,55.33, 15.19 0.00
P003612 1995 China XINJIANG HIGHWAY I 150.00 0.00 0.00 134.03, 20.67 0.00
P003643 1997 China XINJIANG HWY 11 300.00 0.00 0.00 13.43, 105.52 0.00
P003596 1995 China YANGTZE BASIN WATER 100.00 110.00 0.00 103.64, -8.80 0.00
P063123 1999 China YANGTZE FLOOD EMERGY 40.00 40.00 0.00 14.11 10.39 -2.94
P003641 1994 China YANGZHOU THERMAL POW 350.00 0.00 0.00 54.93 0.00
P003599 1996 China YUNNAN ENVIRONMENT 125.00 25.00 0.00 47.73 -1.68
P003473 1993 China ZHEJIANG MULTICITIES 0.00 110.00 0.00 13.01 2.17
P003642 1995 China ZHEJIANG POWER DEVT 400.00 0.00 0.00 4.79 0.00
P003534 1992 China ZHEJIANG PROVTRANSP 220.00 0.00 0.00 14.11 13.45
Total: 15440.40 3955.61 340.41 9729.95 3872.09 269.31
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CHINASTATEMENT OF IFC's
Held and Disbursed Portfolio3 1 -Jul- 1 999
In Millions US Dollars
Committed DisbursedIFC IFC
FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi Partic
1999 Bank of Shanghai 0.00 21.76 0.00 0.00 0.00 21.76 0.00 0.001996 Beijing Hormel 4.28 0.50 0.00 4.40 4.28 0.50 0.00 4.401998 CIG Port Holding 0.00 1.50 0.00 0.00 0.00 1.50 0.00 0.001998 Caltex Ocean 21.00 0.00 0.00 45.00 21.00 0.00 0.00 45.001998 Chengdu Chemical 0.00 3.20 0.00 0.00 0.00 0.00 0.00 0.001998 Chengxin-IBCA 0.00 0.36 0.00 0.00 0.00 0.36 0.00 0.001987/92/94 China Bicycles 0.00 0.95 0.00 0.00 0.00 0.95 0.00 0.001994 China Walden JV 0.00 4.63 0.00 0.00 0.00 4.63 0.00 0.001994 China Walden Mgt 0.00 0.01 0.00 0.00 0.00 0.01 0.00 0.001994 Dalian Glass 10.39 2.40 0.00 18.97 10.39 2.40 0.00 18.971999 Dujiangyan 25.59 0.00 0.00 30.00 0.00 0.00 0.00 0.001995 Dupont Suzhou 20.25 4.15 0.00 36.40 20.25 4.15 0.00 36.401994 Dynamic Fund 0.00 12.35 0.00 0.00 0.00 10.70 0.00 0.001999 Hansom 0.00 16.10 0.00 0.00 0.00 16.10 0.00 0.001996 Jingyang 40.00 0.00 0.00 100.00 40.00 0.00 0.00 100.001998 Leshan Scana 6.10 1.35 0.00 0.00 3.50 1.35 0.00 0.001996 NanjingKumho 11.68 3.81 0.00 33.22 11.68 3.81 0.00 33.221995 Newbridge Inv. 0.00 2.13 0.00 0.00 0.00 2.13 0.00 0.001997 Ningbo 0.00 2.00 0.00 0.00 0.00 2.00 0.00 0.001997 Orient Finance 13.33 0.00 0.00 16.67 13.33 0.00 0.00 16.671997 PTP Hubei 12.63 0.00 0.00 25.38 12.63 0.00 0.00 25.381994/97 PTP Leshan 3.60 0.00 0.00 0.00 3.60 0.00 0.00 0.001996 Pacific Ports 0.00 3.64 0.00 0.00 0.00 3.64 0.00 0.001998 Rabobank SHFC 2.03 0.00 0.00 2.03 2.03 0.00 0.00 2.031998 Shanghai Krupp 30.00 0.00 0.00 68.80 0.00 0.00 0.00 0.001999 Shanxi 19.00 0.00 0.00 0.00 4.50 0.00 0.00 0.001993 Shenzhen PCCP 3.76 0.99 0.00 0.00 3.76 0.99 0.00 0.001995 Suzhou PVC 20.17 2.48 0.00 20.35 20.17 2.48 0.00 20.351998 WIT 5.00 0.00 0.00 0.00 0.00 0.00 0.00 0.001996 Weihai Weidongri 3.80 0.00 0.00 0.00 3.80 0.00 0.00 0.001993 Yantai Cement 11.43 1.95 0.00 6.10 11.43 1.95 0.00 6.101998 Zhen Jing 0.00 2.00 0.00 0.00 0.00 2.00 0.00 0.00
Total Portfolio: 264.04 88.26 0.00 407.32 186.35 83.41 0.00 308.52
Approvals Pending Commitment
FY Approval Company Loan Equity Quasi Partic
Total Pending Commitment: 0.00 0.00 0.00 0.00
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Annex 10: Country at a GlanceCHINA: Urumqi Urban Transport Improvement Project
East Lower-POVERTY and SOCIAL Asla & middle-
China Pacific income Development diamond'1999Population, mid-year (millions) 1,253.6 1,837 2,094 Life expectancyGNP per capita (Atlas method, US$) 780 1,000 1,200GNP (Atlas method, US$ billions) 977.8 1.833 2,513 TAverage annual growth, 1993-99
Population (%) 1.0 1.2 1.1Labor force (%) 1.0 1.3 1.2 GNP Gross
per primaryMost recent estimate (latest year available, 1993-99) capita ' enrollmentPoverty (% of population below national poverty line) S .Urban population (% oftotalpopulation) 31 34 43Life expectancy at birth (years) 70 69 69Infant mortality (per 1,000 live births) 31 35 33Child malnutrition (% of children under 5) 16 22 15 Access to safe waterAccess to improved water source (% of population) 83 84 86Illiteracy (% of population age 15+) 17 15 16Gross primary enrollment (% of school-age population) 123 119 114 China
Male 123 121 114 Lower-middle-income groupFemale 123 121 116
KEY ECONOMIC RATIOS and LONG-TERM TRENDS
1979 1989 1998 1999Economic ratios'
GDP (US$ billions) 175.6 342.3 938.3 996.3Gross domestic investment/GDP 36.5 36.0 38.8 38.3 TradeExports of goods and services/GDP 6.4 12.7 21.9 22.1Gross domestic savings/GDP 35.3 35.3 43.2 41.2 TGross national savingslGDP 35.5 35.4 41.9 39.9 lCurrent account balance/GDP -1.4 -0.9 3.1 1.6 DomesticInterest payments/GDP 0.0 0.7 0.6 0.6 Savings InvestmentTotal debt/GDP 1.2 13.1 16.5 12.8 SiTotal debt service/exports 0.4 9.6 8.5 5.8Present value of debt/GDP 14.4Present value of debt/exports 63 3
Indebtedness1979-89 1989-99 1998 1999 1999-03
(average annual growth)GDP 10.3 10.5 7.8 7.1 7.2 ChinaGNP per capita 8.9 9.0 6.7 6.3 6.2 Lower-middle-income groupExports of goods and services 19.6 14.0 7. 3 13.9 10.5
STRUCTURE of the ECONOMY1979 1989 1998 1999 Growth of Investment and GDP (%)
(% of GDP)Agriculture 31.2 25.0 18.6 17.3 3Industry 47.4 43.0 49.3 49.7 .
Manufacturing 40.2 34.5 37.6 37.8 1Services 21.4 32.0 32.1 32.9
Private consumption 49.5 52.7 44.7 45.8 94 s5 96 97 Da 9aGeneral govemment consumption 15.2 12.0 12.1 12.9 GD1 - GDPImports of goods and services 7.5 13.5 17.5 19.1
1979-89 1989-99 1998 1999 Growth of exports and imports (%)Aaverage annua6 growth)Agriculture 60 4 4 3 5 28 8 30Industry u103 . 412 8.9 8.1
Manufacturing 10.5 13.6 8.7 7.7 20 -' s/A Services 14.0 9.0 8.3 7.5 la
Private consumption 10.1 8.7 6.2 8.3 _General government consumption 9.9 9.8 8.4 7.9 o lGross domestic investment 11.0 12 0 7.6 3.8 94 95 96 97 as 99Imports of goods and services 20.4 12.2 3.0 20.7 - Euports - ImponsGross national product 10.5 10.2 7.8 7.3
Note: 1999 data are preliminary estimates.
- The diamonds show four key indicators in the country (in bold) compared with its income-group average. If data are missing, the diamond willbe incomplete.
- 76 -
China
PRICES and GOVERNMENT FINANCE1979 1989 1998 1999 Inflation %)
Dornestic pdces 30
(% change)Consumer prices 18.0 -0.8 -1.4 2
Implicit GDP deflator 3 9 8.8 2.4 *2,2
Government finance C(% of GDP, includes current grants)Current revenue 19 3 13.0 14.2 la
Current budget balance 2.8 1.4 1.2 GDPdeflator - tCPI
Overaf surplusfdeficit -3.4 4-9 -12 -2.1
TRADE
ISS millons) 1979 1989 1998 r/ c J Export and import levels (US$ mill.)
Total exports (fob) 13658 52,551 *83,529 194,931 2o,am
Food - 6,145 10,619 10,459
Fuel - 4,321 5,181 4,646 150OM
Manufactures - 37,460 163,157 175,033
Total imporns (Gif) 59,140 140,166 165,718 1rc1 0
Food. 4,192 3,793 3,618 50r (I
Fuel and energy 1,650 6,773 8,912 .1Capital goods 16,207 56,768 69,469
Expr price index (1995=100) 25 36 86 8l rr 94 95 81 97 9H
Import price inrex (1995=100) 24 38 89 84 Exporms *Pmports
Terms of trade (1995=100) 104 100 99 97
BALANCE oF PAYMENTS1979 l989 1998 1999 Current account balance to GDP t%)
(US$ rniUlions)Exports of goods and services 15,046 57,101 207,S8B 218,711 TImports of goods and services 17,642 60,655 165,699 169,799 _
Resourre balance -2,796 -3,554 41,687 28,912
2Net income -319 229 -16145 -17,973 t JU l1 1Net cuent transfers 826 381 4,278 4,943
Curnsnt account balance -2,489 -2,944 29,321 15,882
Finarncing items (net) 2,489 2,386 -23,073 -7,377 5Changes in net reserves 0 558 -6,248 -8,505 2
Memo:Reserves includirg gold (US$ millions) ., .. 149,811 158,337
Conversion rate (DEC. local/US$) 2.3 4.9 8.3 8.2
EXTERNAL DEST and RESOURCE FLOWS1979 1969 199t 1999
(US$ millions) i Composition of 1999 debt (US$ snill.)
Total debt outstanding and disbursed 2,183 44,932 154,603 127,639
IBRD 0 2.330 9,644 10,639
iDA 0 2,296 8,693 8,907 G: A to.639
Total debt service 61 5,650 18,166 13,204 - g s7
SRO t0 223 941 1.161
IDA 0 14 97 118 4,275
Composition of net resource flows E
Official grants -30 143 91 201 E 2423e
Official creditors 199 2,277 2,288 3,913 F: 79576
Private craditors 1,580 3,801 1,642 -2,945
Foreign direct investment 57 2,613 41,118 38,752
Portfolio equity 0 -180 -3,927 -9,836
Wodrd Bank program A - lBRD E - Bilateral
Commitments 0 1,760 2,636 2.311 B - IDA 0 - Other multilateral F - riate
Disbursemennts 0 1,111 2,068 1,780 C-IMF G-Shrl-ern
Principal repayments 0 62 434 558
NetLt vvs 0 1,049 1,632 1,222
Interest payments 0 173 504 720
Net transfers 0 874 1,028 502
Development Economics 9/30r/00
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AdditionalAnnex No.: 11
Environmental Assessment and Action PlanBackground:
1. O.D. 4.01 Environmental Assessment applies to this project since the meeting on the ProjectConcept Document (PCD) was held on November 23, 1998. The project is classified category A since itinvolves resettlement, major ring road construction partly on new alignment and increased air pollution andnoise, particularly adjacent to the ring road. As required by OD 4.01 for Category A projects, theEnvironmental Assessment (EA) Report, Environmental Action Plan (EAP) and EA Summary report wereprepared by the Xinjiang Environmental Assessment and Techniques Center (XETAC), part of theXinjiang Environmental Monitoring Center (XEMC). The development and review of these documentsinvolved inputs from various local units, including the Urunmqi Environmental Monitoring Center (UJEMC).Advice and support during preparation was provided by consultants funded from the Canadian Trust Fundwho participated in the Bank missions throughout 1999.
Disclosure
2. The State Environmental Protection Agency (SEPA) reviewed and approved the Chinese languageversion of the draft EA in September 1999. Draft English versions of the reports were submitted to theBank in October 1999, and final versions in December 1999. The final EA Summary Report (and the RAPSunmmary Report) were made available to the public in Chinese and Uygur in early September 1999. Thefinal versions of the EA, EAP and EA Summary documents in Chinese and the EA Summary Report inUygur were made available in the Urumqi Public Library on December 5, 1999. A corresponding full setof EA, EAP and EA Summary documents in English was sent to the World Bank Public InformationCenter (PIC) in Washington, D.C. with authorization from UMG, on December 29, 1999. The appraisalmission confirmed the availability of the EA in Chinese and EA Summary in Chinese and Uygur inUrumqi. Tables 1-5 provide details of consultation and disclosure.
Brief Project Description:
3. The major investment in the project is the creation of a 31.25 km urban ring road (involving 29kilometers of new construction), including 8.3 km of elevated viaduct, 10.5 km of ground expressway, 9.6km of urban arterial, a 450 m tunnel, and 9 interchanges (including Wuchang Interchange to be built byXinjiang Highway Bureau). The existing road will be widened from 16-50 m to 24-60 m and will have 4-6lanes for motor vehicles in the main carriageways. With the exception of small areas at the interchanges,the new road is constructed within the existing planning line (red line). The design driving speed is 60-80km/hr. In the Road Network Improvement sub-component, sections (totaling 1.2 km) of Heilongjiang Roadand Tuanjie Road will be reconstructed with 4 lanes.
4. Additional components of the project include: road maintenance equipment and studies, publictransport priority measures including improvements to existing bus terminals and market areas; trafficmanagement and road safety programs including development of pedestrian footpaths and crossings; publictransport operating systems including modemization of bus maintenance facilities and re-construction of acommunications and training center on an existing site; motor vehicle emissions control program includinga vehicle research center and improvement of existing inspection and maintenance facilities; systematicmanagement of urban transport; and technical assistance and training. Several investment items under the
- 78 -
public transport route network sub-component will be identified in detail following completion of proposedroute network studies.
Baseline Environmental Description:
5. Based on air quality monitoring completed in October of 1998 (non-heating season) and January of1999 (heating season), the existing air quality in Urumqi is poor. During the non-heating season, airpollution results mainly from air-borne dust and motor vehicle emissions. The pollution allocation (or theproportion of total pollution attributable to a specific parameter) of TSP, NOx, S02 and lead is 31%, 28%,15% and 4%, respectively. These levels exceed standards for TSP and NOx but not S02 (levels of S02are 33.3% of the standard). During the heating season, air pollution results primarily from coalcombustion. The pollution allocation of S02, TSP, NOx, CO and lead is 34%, 22%, 19%, 15% and 2%,respectively. The rate of exceeding the standard for each is 100%. One chronic cause for the poor airquality in Urunqi is the persistent inversion layer above the Urumqi City.
6. Based on noise monitoring and modeling estimates, within 30 m of the roadside, the current rate ofexceeding the noise standards during the day and at night is 25% and 75%, with average excess of0.1-0.8dB(A) and 2.6-10.2 dB(A), respectively. The exceedance at sensitive receptors such as schools,hospitals and kindergartens is higher due to the more stringent standards, with the average of 5.1-14.4dB(A) during the day and 2.8-16.1 dB(A) at night, respectively.
7. Land use adjacent to the project is variable and includes agricultural areas in the west, the railwaystation and business district in the south and a coal mining area in the northeast. The Ring Road isbasically a city main road; fauna is simple and the number and variety of wild animal and plant species arelow. Shade trees are present but sparsely distributed along the Ring Road and the area of public greenspace and treed land is also low.
8. The resident population is 252,900 within 300 m of the Ring Road. There are no importantcultural ruins or traditional cultural resources (other than mosques) within 300 m of the Ring Road. Thereare a total of 339 units, including cultural and educational institutions, medical and health departments,government organizations and recreational facilities along the alignment. Of these, 46 units are classifiedas sensitive receptors including hospitals, schools, markets, dense residential areas and mosques.
Analysis of Alternatives:
Strategic Options
9. Prior to project identification, the Project Executive Office (PEO) of the Urumqi MunicipalGovemrnment (UMG) solicited alternative design concepts from seven domestic design institutes, whichtogether developed 24 design concepts for the proposed Ring Road. These concepts provided backgroundmaterial for the later preliminary design work.
10. During the project preparation phase, the UMG leadership and transport agencies discussedstrategic choices to address the key sector issues of road capacity, public transport, traffic management andmanagement of the environmental impacts of motor vehicles. The need to invest in the expansion of roadcapacity, particularly in a ring road, was examined in depth given that the North-South Hetan expresswaywas recently built. Public transport altematives considered included investment in vehicles, in a new busdepot, and more extensive bus priority measures, including a possible busway.
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11. Strategic Network Analysis (using a computer based transport model) was undertaken to identifythe need for a major investment and compare alternative investment programs to meet future demand. Fivenetworks modeled were:
A. The existing road network plus new links and upgrading planned to be in service in eachmodeled year as per the Master Plan, but excluding the Ring Road (the "do nothing" or "dominimum" base case).
B. Network A plus the whole Ring Road.C. Network A plus limited upgrading of existing roads on the Ring Road alignment, together with
complementary improvements to other parts of the network, as a lower cost alternative to theRing Road.
D. Network A plus infrastructure to support bus priority measures on major arteries.E. Network A plus a north-south light rail transit (LRT) line and feeder bus services with bus
priority measures on other corridors.
12. Strategic Network Analysis results are detailed in Annex 4. For Network A ("do minimumn") in2010, estimated volume/capacity ratios on key north-south corridors and CBD streets indicate congestedconditions under this scenario. The major investment in the Ring Road (Network B) improves thissubstantially with the greatest increase as expected on the Ring Road corridor and the CBD. The majorpublic transport network E (LRT) produces small savings in vehicle kmn over Network B while improvingspeeds in the CBD over those of Network A. Lower-cost alternative road network (Network C) andbus-oriented public transport (Network D) scenarios also improved on Network A, but did not perform aswell on system performance indicators as Network B (Ring Road), due in part to the lower investment costsassociated with those options.
13. Based on these tests, the network with the Ring Road (Option B) was selected for preliminarydesign. For the purposes of economic evaluation, modeling was carried forward for an enhanced NetworkA and Network B (Ring Road) only.
Ring Road Alternative Alignments and Design Standard Options
14. In this context, the word "alternative" is used only to refer different alignments for a given segmentof road, while the word "option" is used to refer different road configurations or designs on the samegeneral alignment.
15. Use of the transport model to test alternative junction layout and design standards was continuousthroughout the preliminary design process. A major outcome of the analyses of travel demand was thereduction of roadway standards for the eastern and northern sections of the ring road alignment. Trafficfigures also informed decisions relating to the need for elevated sections, number of lanes, and interchangelayout and scale. Design changes are documented in the various Ring Road feasibility and modelingreports as listed in Annex 8.
16. Based on the engineering and environmental analysis, five segments of the Ring Road consist ofalignment alternatives (see Map 30808R). The alternatives for each segment are as follows:
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Segmnent 1: Qiantangjiang Road - Tuanjie Road (south Ring)A. Alignment of Qiantangjiang Road - Tuanjie Road (preferred)B. Alignment in the south of Qitanjiang Road
Segment 2: Liudaowan-Wuchang Road (North Ring)A. Alignment of Suzhou Road - Altay Road (preferred)B. Alignment of Henan Road
Segment 3: East Karamay Road - Nanhu Road (Northeast Ring)A. Alignment of Nanhu Road (preferred)B. Alignment of crossing the coal mine area (surface road)C. Alignment of crossing the coal mine area (elevated viaduct)
Segment 4: Altay Road - Wuming Road (northwest ring)A .Alignment of crossing Heishantou by tunnelB. Alignment of detouring Heishantou to the southC. Alignment of detouring Heishantou to the north (preferred)
Segment 5: Xishan Road - Heilongjiang Road (Hongshanzui section)A. Alignment of crossing Hongshanzui by tunnel (preferred)B. Alignment of detouring Hongshanzui along Baoshan Road
17. The preferred alignments were selected in each segment based on comparisons of environmental,socio-economic and relocation and resettlement impacts. A full analysis of the altematives is presented inthe EIA report. In general, the alignment with the least impacts compared with other altematives in thesame segment was considered as preferred and incorporated in the project. Engineering related factorswere also evaluated during the comparison. The alignment of Segment 3 passes through the Liudaowancommunity, and the alignment of Segment 5 through the Yamalike community. In both areas, and in orderto minimize impacts on the communities, refinements to the preferred alignment continued to be made whenpreparing design options.
18. On the basis of the comparison and selection of altematives and traffic volume forecast, fourdesign options related to the configuration, scale and complexity of the ring road were proposed on thepreferred alignment. One option, (referred to as option 4 in the project documents) had the least amount ofviaduct and expressway and was also the simplest in terms of engineering design. It was also considered tohave the least potential adverse environmental and socio-economic impacts. When all factors wereconsidered, including engineering considerations and traffic forecasts, Option 4 was selected as thepreferred design for the ring road. The ETA covers the detailed assessment for this option.
Potential Environmental Impacts and Mitigation Measures:
19. The major potential environmental impacts associated with the project and the mitigation measuresare outlined in both the EA Report and in the EAP. The EA Report concluded that the proposed projectwould address emerging and projected traffic congestion in the city center, improve the quality of urban lifeand stimulate economic development, resulting in both social and economic benefits. The report alsoindicated there would be both positive and negative impacts on the environment.
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20. The EAP stipulates how the environmental protection measures identified in the EA Report will beincorporated into the design, and implemented during the design, construction and operation phases of theproject and what institutional arrangements have been made to ensure their effective implementation. Thekey elements of the EAP are sumrmarized below:
Key elements of the EAP:
Design Phase
21. As described above, an analysis of two or three alternate aligmnents was undertaken on each offive sections of the Ring Road by the project team including the EA team. Major alternative alignments areshown on Map 30808R. A number of criteria were considered in the evaluation for each section includinglength, road condition, planning width, as well as technical, socioeconomic, resettlement, implementationand environmental factors and engineering costs. As well, four different design options were evaluated ingreater detail in order to select the final design configuration. During this process a variety of potentialenvironmental effects were avoided or minimized.
22. A number of features to minimize noise effects have been incorporated into the design. Thesemeasures include limiting construction of elevated viaduct to locations where road widening is not possible.Construction materials for road surface structure with effective sound absorption will be applied in certainareas to reduce traffic noise. In order to ensure traffic safety and minimize the traffic noise, green spaceswill be created to separate motor vehicles, non-motorized vehicles and sidewalks. Protection of someresidential buildings and sensitive receptors adjacent to the road will be accomplished with the use of soundbarriers. In order to minimize the sunshine obstruction by the barriers in certain locations, they will bemade of transparent materials and easily assembled and disassembled for regular cleaning. Double-glazedwindows will be utilized at special sensitive receptors, e.g. school, hospital and kindergarten, affected bytraffic noise. Comprehensive sound insulation will be implemented for the housing of the first row ofresidential buildings affected by traffic noise, e.g., double-glazed windows in combination with coolingsystems.
23. Structures and materials effective for vibration mitigation will be put into the joints betweenpre-fabricated structures and bridge piers. Application of flexible supports, such as rubber and bowlshaped supports for viaduct and interchanges will buffer vibration of structure and reduce noise. Roadsurface quality also has a direct impact on vibration. The use of high quality materials for surfacesmoothness and regular maintenance and repairs will be required.
24. The shape of the elevated viaduct will be unified, harmonious and homogeneous so as to blend inas much as possible with the existing visual environment. The existing dumpsite adjacent to LiudaowanRoad-Nanhu Road section will be landscaped to enhance its visual appearance from the road.
25. The total greening area within the right of way (red line) is 227,600 m'. An additional 212,750 mof trees will be provided as part of the Environmental Management Component of the project, meeting thegreening target of 30% of the area for new construction projects. The width of the treed area along thesections in urban area will not be less than 2 m. In the farmland section of the West Guojin Road, thewidth of shade trees will be at least 5 m with more than three rows, to meet the effect of a farmland shelterbelt.
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26. To ensure access, 18 pedestrian facilities are to be constructed along the Ring Road including 16pedestrian overpasses. Two additional underpasses are also provided on the west side of Changjiang Roadand at the entrances of western Henan Road and Altay Road. At other intersections and the sectionsadjacent schools, residential and commercial areas, signalized and unsignalized zebra pedestrian crossingswill be provided.
27. Construction of a replacement for the Lanzhou Mosque will be completed prior to the demolition ofthe existing mosque. Additional details related to resettlement along the entire project are provided in theResettlement Action Plan.
Construction Phase
28. Dust will be generated during the course of demolition and large-scale excavation. Full-timeenvironmental protection staff will be inspecting sites and will be implementing dust control measures suchas the use of water or the enclosure of construction sites. Asphalt plants and concrete-mixing stations willbe located in designated areas only to minimize impacts. Vehicles transporting building materials (e.g.cement, earth and stone) will be covered with tarpaulin. At construction sites where dust easily created bymixing, loading and unloading of building materials, effective measures such as watering will be taken toprevent or mitigate dust. The rubbish of workers will be stored in a closed site and will be disposed ofregularly. The location of temporary roads for construction will be kept away from residential areas andother sensitive receptors. Proper operations, maintenance and repair of power generators and constructionmachinery will be carried out to minimize emissions.
29. The use of noisy machinery, such as percussion hammers, pneumatic drills and rock drills duringthe night (00:00-08:00), will be strictly prohibited. Machinery with low noise and machinery with noiseshielding and/or sound absorption materials will be used as much as possible, e.g. on-site generator withmufflers or silencer. Contractors will rationalize work timetable, keep noisy operations away fromsensitive points, carry out regular maintenance and repairs, and enforce strict implementation of operationprocedures. Where sites are seriously affected during construction, temporary enclosure with noiseshielding and /or sound absorption will be set up. Steam and diesel pile drivers are prohibited for use inareas where sensitive receptors are within 50 m of construction sites. The construction components forviaducts and interchanges will be prefabricated and transported to the construction sites. If on-sitemonitoring results exceed standards, environmental inspectors or the Xinjiang Enviromnent MonitoringCenter will report this to the PEO, and the PEO will stop the construction for rectification. Contractorsmust abide by the provisions for construction noise (vibration) prevention and control in Urumqi. It isprohibited to use steam and diesel pile drivers as well as monkey driver at the project site. Except foremergency engineering, the operation of strong vibration machinery is limited to 08:00-00:00. Low-levelvibration machinery will be used as much as possible and a system of regular maintenance and repairs is tobe employed. UMG has undertaken to place all mitigation requirements in the contractual documents forconstruction contracts.
30. At construction sites where public toilets are not available, temporary toilets and sewage collectionand appropriate disposal will be provided. Restoration of the sites will be carried out once the constructionis finished.
31. Environmental inspectors will ensure the irrigation and flood-relief canals will not be affected.Construction vehicles will be driven on the designated temporary roads. In areas near cultivated land andorchards, dust-proof measures will be implemented. Surplus earth and stone will be collected and disposedof at designated sites only. In the Yamalike hills section, abandoned earth and stone generated during
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tunneling will be relocated and not stored on slopes. Surplus earth and stone will be will be used as muchas possible for fill. If the contract sections can not be constructed simultaneously, surplus earth and stonewill be temporarily stored at designated sites and ultimately disposed of in the coal mine. Retaining wallsand drainage ditches will be established on hills on both sides along cut and fill sections. Erosion controlmeasures will be implemented.
32. Feasible measures for traffic management will be determined prior to construction by the PEO inconsultation with the traffic police. Project supervisors will cooperate to avoid traffic congestion due toconstruction. As well, the public will be notified in advance. When carrying out construction in front ofschools, the contractor will appoint specific persons to guide the pupils safely through the construction site.Overhead safety shelters will be installed when the construction is in residential and/or commercial areas.Separate roadside construction will be adopted for road widening in order to provide safety to bothpedestrians and vehicles.
Operational Phase
33. Relative to the without-Project case, the project will result in the degradation of the air qualitywithin 200-300 m of the alignment, but will make a positive contribution to the overall air quality in theurban area, particularly in the city center. Since it is not feasible to mitigate the deterioration in air qualityonly along the alignment, a Motor Vehicle Emission Control Strategy has been incorporated into the project(see Component D Environmental Management). The objective is to build on existing initiatives beingundertaken in Urumqi, and to develop strategies and provide a strong foundation for a program to addressthe problem of increasing air pollution from mobile sources. The program will integrate a number ofinitiatives including the ban on leaded fuel; an enhancement of the existing vehicle Inspection andMaintenance (I/M) system; increased use of altemate fuels; improvement of laws and regulations related tovehicle emissions and their more rigorous enforcement; accelerated retirement of older vehicles; furtherdevelopment of public transit and traffic management and the expansion of the automated monitoringnetwork to monitor air pollution.
34. The control plan and objectives for vehicle noise will be formulated by Urumqi EnvironmentProtection Bureau (UEPB) and the standard for motor vehicle noise will be gradually increased. Thesystem of regularly inspecting motor vehicles for noise will be undertaken by UEPB in cooperation withtraffic police. Vehicles exceeding the standard will have to be repaired. Driving speed will be strictlyenforced, particularly at night. Pavement and noise barriers will be maintained regularly. The MunicipalLand Administration and the Municipal Planning Bureau will implement proper planning and land usealong the road. The distance between the first row of buildings and the Ring Road red line must not beless than 20 m and must incorporate a vegetation buffer in the newly developed and redeveloped areas.Sensitive uses such as schools, hospitals and kindergartens will not be pennitted in the first row ofbuildings along the Ring Road. Within 100 m of the red line, land use will be restricted to commercialfacilities, parking lots and other insensitive uses. Land use sensitive to vibration, e.g., hospitals andinstitutions using precise instrumentation will not be permitted within 40 m of the road.
35. With respect to the impacts on sunshine, home owners on the first floors of the four buildingsaffected by elevated viaduct will have priority access to municipal programs designed to convert theresidences to commercial enterprises. Reasonable and proper land use planing will be implemented togradually adjust the function of affected buildings. For newly constructed buildings distance from theviaduct must be a minimum of 14.7 m.
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36. As required by local regulations, proper licenses must be obtained from the municipal transportadministration for the carriage of dangerous goods. When transporting explosives or dangerous chemicals,the carrier must obtain a transport license from the police. The State Law of Environmental Protectionstipulates that when accidents occur, the responsible organization must take measures at once, notify theaffected organization and residents, report to local environmnent department and related departments andundertake an investigation. According to the stipulations in laws combating water and air pollution, spillsof dangerous goods are handled by the police, the municipal environment department and the trafficmanagement department. Vehicles for transporting dangerous goods must be driven on speciallydesignated routes rather than on the Ring Road unless they have obtained a special permit.
Environmental Monitoring:
37. The EAP identifies requirements related to the environmental inspection and monitoring program.Environmental inspectors will be assigned for each civil works contract to respond to unanticipatedenvironmental concems and will ensure the implementation of the mitigation measures and compliance withestablished standards (e.g., noise and dust). Environmental monitoring will also be undertaken by XEMCduring both the construction and operation phases to ensure the effectiveness of mitigation measures and todetermine the accuracy of impact predictions. Parameters to be monitored include air quality, dust, noiseand vibration. The project includes an environmental training component for contractors and inspectors.The staffing and training plan is presented in the EAP.
Public Consultation:
38. Public Consultation was implemented in two stages: the first between August 1998 and June 1999and the second between June and September 1999. A variety of techniques were utilized including: sitevisits; surveys (including the distribution of questionnaires, letters, and phone interviews); public meetings;the distribution of pamphlets (in Chinese and Uygur) giving an overview of the project and indicating theavailability for review of the draft EA Summary in both languages, and the announcement of the secondpublic meeting. Advertisements were also provided in both languages in local newspapers and on radio.As well, a phone hot line was established for telephone inquiries in Chinese and Uygur related to theproject. Table 4 provides further details.
First Round (August 1998 - June 1999)
39. During the initial phase of consultation 57 institutions, 10 residential committees and 6 mosqueswere surveyed by site visits (including 162 people), and 72 phone interviews were conducted. In all morethan 200 questionnaires were distributed and 145 responses were received. In addition, 3 official letters, 2documents with official seals and 187 telephone responses were received. The initial public meeting of thefirst stage was held in Urumqi Construction Commission on Dec. 28, 1998. The meeting was attended by40 representatives from the environmentally sensitive receptors (schools, hospitals etc.), residential areas,villages, sub-district offices, residential committees, enterprises and institutions (such as TransportCompany and Liudaowan coal mining area). Two reporters took part in this public meeting. In the publicmeeting, the objectives and proposals for the project were presented. Potential environmental impacts(including resettlement) and the related mitigation measures were discussed in general.
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Second Round (June - September 1999)
40. Starting in May 1999, the availability of the preliminary EIA reports was announced both inChinese and in Uygur in Metropolitan Consumer Morning and Urumqi Evening papers. Two telephone hotlines were established and also announced to the public. The public was invited to make inquiries related tothe EIA by telephoning or visiting either the PEO or the EIA team. In addition, the EIA Summary report,in both Chinese and in Uygur was distributed to each residents' committee. More than 800 pamphletssummarizing the project were distributed along the Ring Road. The project team made 17 site visits intotal along the Ring Road and visited sensitive receptors to review options for environmental protection.The project content, alignment and its environmental impacts and proposed mitigation measures wereintroduced to local residents during on-the-spot meetings.
41. A second public meeting was organized by the Urumqi Construction Committee on September 24,1999. Over 140 representatives of the sensitive receptors, the resettlement department, the District People's Congress and the government agencies attended this meeting. In this meeting, the alignment, constructionscale and schedule of the Ring Road were reviewed. Issues related to both resettlement and theenvironmental impacts and protection measures along the Ring Road, particularly at the residential areaand sensitive locations, were discussed in detail.
Future Consultation
42. Future public consultation will also be held at the district level. These meetings will be focused onensuring the people most affected by the project are made aware of the mitigation measures to beimplemented. It has been agreed that these meetings will be held annually, at least two months in advanceof construction, in the areas where construction is to take place each year. The results of these meetingswill be documented in the annual monitoring reports. There will also be signage posted at eachconstruction site, which will provide phone numbers for information or inquiries related to the construction.
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Public Consultation on Environmental Assessment
Table 1: Disclosure of Main EA documentsDocument Language Disclosure Date Location Version DateEIA Chinese 12-5-99 XUAR Public Library 12-1-99
English 12-5-99 XUAR Public Library 12-5-99EAP Chinese 12-5-99 XUAR Public Library 12-1-99
English 12-5-99 XUAR Public Library 12-5-99EA Summary Chinese 12-5-99 XUAR Public Library 12-1-99
English 12-5-99 XUAR Public Library 12-5-99Uygur 9-30-99 Public meeting 9-24-99
Uygur 12-5-99 XUAR Public Librarv 9-24-99*Source: UMG release letters
Table 2: Disclosure of September 1999 Public Me eting DocumentDocument Language Disclosure Date Location Version DateEA Summary Chinese Starting on At meetings in small 9-10-99
9-13-99 groups, 26 localneighbourhoodcommittees in each offour regions and onecounty subdistrict form9-13-99 to 9-24-99.Also at a large publicheld on 9-24-99.
EA Summary Uygur Starting on At meetings in small 9-10-999-13-99 groups, 26 local
neighbourhoodcommittees in each offour regions and onecounty subdistrict form9-13-99 to 9-24-99.Also at a large publicheld on 9-24-99.
Table 3: Public NoticesDocument Language Disclosure Location Name of Newspapers
DateRelease of EIA for Outer Ring Chinese 5-99 Chinese Metropolitan ConsumerRoad Newspaper Morning NewspaperNotice for Availability of RAP Chinese 8-99 Chinese Metropolitan Consumerand EIA Summary Reports Newspaper Morning NewspaperNotice for Availability of RAP Uygur 9-99 Uygur Urumqi Evening Newspaperand EIA Summary Reports Newspaper
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Table 4. Details of Public Consultation on EA
Item Means Participants Date of LocationConsultation
First Round Information for EA team August 1998 to Proposed roadConsultation proposed alignment Project Affected November alignment andEA TOR distribution to public People 1998 adjacent areas
* Public opinion Enterprise reviewquestionnaire Local residentsdistribution Experts and scholarsInterviewExpert consultation
First Round Initial public EA team December 1998 MunicipalConsultation meeting PEO to June 1999 ConstructionPreliminary Telephone hotline Local environment Commissiondraft EA Letters bureau officereport I On site consultation Project Affected Proposed road
* Public hearing People alignment andmeetings Local neighborhood adjacent areas- Expert group committeereview NGOs (religious
organizations)
Second Expert group EA team June 1999 XinjiangRound discussion PEO Beijing OfficeConsultation Local experts andFinal draft scholarsEA report
Second On site consultation Project Affected June 1999 Liudaowan,Round People Laomaochen,Consultation * Local neighborhood MosquesFinal draft committeeEA report * Religious leaders and
groups from localmosques
Second Public hearing Project Affected September MunicipalRound meeting People 1999 ConstructionConsultation Local neighborhood CommissionFinal draft committee officeEA report Religious leaders and
groups from locall___________________________ a____ mosques
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Table 5. Details of Information Disclosure for EA
Document Means Date of LocationDisclosure
Main points of EA - Distribution to Project August 1998 to Proposed projectTOR Affected People November 1998 alignments and areas
Telephone hotline
Project Information & Leaflets August 1998 to Proposed project areasQuestionnaire Visit households June 1999
Preliminary draft EA Announcement via local May 1999 "Metropolitan Consumerreports (including EA news papers Morning Newspaper"Summary & EAP) Telephone hotline (Chinese)
Final draft EA reports Announcement via local August 1999 "Metropolitan Consumer(including EA news paper Morning Newspaper"Summary & EAP) (Chinese)
Local radio August 1999 Urumqi Economic Radio
Announcement via local September 1999 "Urumqi Evening Newsnews paper Paper" (Uygur)
Booklets September 1999 Ring road alignmentEnvironment summary and communities
report - 26 local neighborhoodcommittees
Displayed for reading & September 1999 Ring road alignmentreference in the public and communitiesconsultation meetings - 26 local neighborhood
committees
Displayed for reading & September 1999 Municipal Constructionreference in the public Commission officeconsultation meeting
"Notice for Announcement via 26 Local September 1999 EA summary includingAvailability of EA neighborhood committees both Chinese and Uygurreports" in 26 local neighborhood
committees
Final EA reports Displayed and filed in PEO Since December PEOand public area for inquiry 1999 Xinjiang Public
Library
* Leaflets, booklets and EA summary are in both Chinese and Uygur.
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AdditionalAnnex No.: 12
Land Acquisition and ResettlementIntroduction:
1. This annex reviews adverse impacts related to land acquisition or changes in land use for theUrumqi Urban Transport Improvement Project (WUTIP), and the arrangements proposed in theResettlement Action Plan (RAP) to mitigate them. Consistent with World Bank Operational Directive 4.30on Involuntary Resettlement, the objective of resettlement planning is to ensure that incomes and livingstandards are improved, or at least restored, for all persons adversely affected by the project.
Project Composition:
2. The proposed UUTIP consists of five components:A. Road Network Development, mainly of an urban ring road;B. Traffic Management and Road Safety;C. Public Transport - reform and development;D. Environmental Management; andE. Institutional Development - Urban Transport System Management.
Only the road network development component will involve land acquisition and resettlement. The roadnetwork development component includes creation of a 31.25 km. urban ring road and improvements toseveral connecting roads in Urumqi. All of the resettlement-related impacts in the project will be caused byconstruction of the ring road.
Resettlement Impacts:
3. UUTIP will require 510 mu (34 hectares) of new land area (along with use of 2,013 mu, or 134hectares, of existing right-of-way). This includes acquisition of 197.5 mu (about 13 hectares) of rural land,of which 100.8 mu (about 7 hectares) is cultivated, and transfer of 312.5 mu (about 21 hectares) of urbanland-use rights. Acquisition of cultivated land will directly affect 53 households (218 individuals).Structural demolition is expected to total 151,207 square meters, including 57,615 square meters ofresidential housing. A total of 854 households (3,492 individuals) will need to be relocated. A total of 835enterprises or work units will be affected by non-residential demolition or loss of land, but no one willpermanently lose employment. In terms of community irnpacts, one mosque will require relocation androad construction will temporarily disrupt access to comnuunity facilities in some locations.
4. Urumqi is ethnically diverse. About 31% of the households to be relocated are members ofminority nationalities, and road construction will affect iwo predominantly minority areas - Yamalike andLiudaowan. Measures have been taken to ensure that is$sues of potential concem to minority householdshave been addressed (see Annex 15 for additional details).
Legal and Policy Framework:
5. The legal basis for land acquisition and resettlement planning includes national, provincial andlocal laws and regulations. Relevant national laws or regulations include the Land Administration Law(1998), City Planning Law (1990), and The Administrative Regulation on Urban Building Demolition and
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Relocation (1991). The State Land Administration Law was revised in 1998 and became effective January1, 1999. Revisions to the XUAR Implementation Regulation of the State Land Administration Law toaccord with the new State Law are still in draft form. The RAP devised for this project will therefore beimplemented in accordance with the prevailing 1989 XUAR regulation. The most relevant municipalregulation is the Urumqi Municipality Administration Regulation on Urban Building Demolition (1995).
6. In China, all land officially designated as urban is owned by the state, and all cultivated rural landis owned by village collectives. As a result, there are two types of land acquisition for this project. One isto acquire collectively owned rural land, with compensation and other forms of assistance provided to thecollectives losing the land. The other type of land acquisition is to acquire land use rights within the urbanbuilt-up area. In this case, the acquiring agency or unit must provide adequate compensation orresettlement housing for the displaced families and affected enterprises. For UUTIP, both types of landacquisition are involved.
7. When collectively owned farmland is acquired, the future land user pays compensation for land,loss of crops and attached properties, and a resettlement subsidy for the rehabilitation of affected persons.Following the revised Land Administration Law, the land compensation will be 6 - 10 times the averageannual output value per mu for the three years before land acquisition. The resettlement subsidy,determined according to the number of agricultural population to be resettled, is usually an additional 4-6times (but is not to exceed 15 times) the average annual output.
8. Young crop compensation and compensation for affected structures or other fixed assets are paiddirectly to individuals. The land compensation and resettlement subsidy is to be paid to the collectiveslosing the land. This compensation is to be used for production development, non-farm employment andincome generating activities for the affected people. With village members' prior approval, it can also beused for improving community facilities or services. By law, separate accounts on resettlementcompensation are to be kept at each affected village, with financial reports provided annually to the nexthigher level of government.
9. Those affected by urban demolition are to be compensated through property rights exchange, directasset replacement, cash compensation, or some combination of such compensatory measures. While no oneis expected to lose employment permanently, some persons will lose wages or profits for a transitionalperiod. They are entitled to transitional wage or profit support. Additionally, the project affects renters ofresidential or commercial space as well as owners. They also will be provided with transitional supportand other forms of assistance necessary for them to re-establish themselves.
Compensation Standards:
10. Based on analysis of replacement value for various categories of affected assets, a set ofcompensation standards have been adopted for WUTIP.
11. For cultivated land, the compensation rate (including both land compensation and resettlementsubsidy) is set at 24 times the average annual output value for the past three years. Specifically, thecompensation rates are to be 36,000 RMB per mu (or about US$66,000 per hectare) for vegetable land,33,000 RMB per mu (or about US$60,400 per hectare) for irrigated land, and 39,000 RMB per mu (orabout US$71,300 per hectare) for orchard. For non-cultivated land, including housing plot and wasteland,a flat rate of 15,000 RMB per mu (or about US$27,400 per hectare) will be paid to the affected villages.
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12. For affected structures and facilities, compensation standards are as follows:
Items Unit Compensation Rate (RMB)
1. concrete frame structures (mi) 6702. brick /concrete structures (mn) 530
3. brick /wood structures (mi) 5004. wood/tile structures (in) 460
5. simple structures (mi) 1806. wall (m) 507. standing crop mu 1,5008. residential moving subsidy household 200-2509. unit moving assistance (mi) 1010. temporary transfer per person/month 50
Rehabilitation and Relocation Planning:
13. Because WJTIP is situated primarily in an urban area, major project-related impacts are associatedwith structural demolition, meaning that the major mitigation measures are associated with relocation. Noone is expected to lose employment permanently in urban areas affected by the project, so rehabilitativeefforts are focused primarily upon the relative few households affected by acquisition of cultivated land.As is common in China, those losing land will be accommodated through collective land redistribution.The affected villages will use compensation to identify and pursue productive investment opportunities.Initial investment plans made by affected collectives emphasize agricultural intensification and bringingwasteland into production.
14. Relocating rural households (55 households) will be given house compensation at replacement costwith no depreciation, and salvageable materials will belong to them. They also will be provided withalternative housing plots by their villages. Relocating urban households living in public rental units (278households) will be provided with replacement rental housing units of similar size and improved quality.Urban private house owners (480 households) will be provided with three options, including replacementhousing with ownership right, full compensation for lost housing plus the right to rent replacement housingat low rates, or double the compensation rate for lost housing if the affected household accepts fullresponsibility for its own relocation. Those renting private houses (41 households) can continue leaseagreements with their current landlord after resettlement, or the project will assist them in locating anotherplace.
15. The project will affect 181 households lacking legal residency status or living in illegal structures.In local practice, such households are not considered eligible for compensation or other forms of assistance.To meet Bank policy requirements, however, the Uruimqi municipal government adopted a special policy toprovide such households with eligibility for modem public rental housing at highly subsidized rates. Inaddition, they will receive 50% of compensation rates for illegal structures.
16. For affected enterprises or work units subject to structural demolition, three options will beprovided. They can choose to receive replacement space with ownership, rental space plus fullcompensation for lost structures, or double compensation if they choose to make their own relocationarrangements. Affected work units using rented space can continue present arrangements if the landlord isable to rebuild the lost commercial space, or they are to be provided equivalent replacement rental space atequivalent rates by the project.
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17. The project also will affect public infrastructure. Compensation based on replacement value willbe paid to the relevant government agencies or local governments to restore the affected infrastructure andservices.
Institutional Arrangements:
18. Implementation responsibilities are shared between the UUTIP Project Executive Office (PEO) andthe local district or county governments. A Resettlement Leading Group has been formed to bring togetherleaders from relevant municipal departments, districts or county governments, and the PEO. This group isresponsible for making policy decisions, coordinating implementation, and resolving any issues that arise.
19. Under the leading group, a 5-6 person Project Resettlement Office (PRO) is to carry out routineresettlement activities. Their responsibilities range from organizing the census of affected persons, andtraining local field staff, to supervising disbursement of compensation and monitoring resettlementprogress. The PRO will supervise the activities of district-level workers involved in resettlementimplementation.
Community Participation and Public Disclosure:
20. Municipal and district officials, as well as project design staff, have consulted with potentiallyaffected communities in identifying resettlement impacts, formulating resettlement policies, and preparingresettlement plans. In addition to numerous informal consultations during site selection and other aspectsof project preparation, preparation of the RAP included a census-survey of 100% of potentially affectedhouseholds, a supplemental sample survey of households lacking residency permits, and other consultativeactivities. Additional opportunities for residents to voice concerns regarding project impacts andresettlement arrangements occurred as a result of the environmental assessment process. Consultationshave contributed to minimization of impacts and identification of mitigation measures acceptable to theaffected persons. Major shifts in alignment, alteration of arrangements for pedestrian or non-motorizedvehicle access and other changes in project design have been made at least in part as a response toresidents' concerns.
21. Additional consultations will be undertaken as resettlement arrangements are finalized in theLiudaowan area prior to initiation of civil works. Road construction in this area is not scheduled to occuruntil 2003. The proposed road alignment remains subject to review because of technical siting constraintsin an area under use for coal mining. Additional consultations also will be undertaken in other areas ifwarranted by other significant changes in project design.
22. Detailed information regarding the project and the resettlement program has been published in localnewspapers, in both Uygur and Chinese. As required by Bank policy, an earlier draft RAP was madeavailable in September 1999. The draft RAP in English was received by the Bank prior to appraisal, anddiscussed with UMG during the appraisal mission in January 2000. Uygur, Chinese, and English versionsof the project RAP were made available to the public at the Urumqi Public Library in January 2000 (andany future revisions will be disclosed in a similar manner). The RAP in English was received by the Bankon February 4, 2000, and after clearance, was sent to the PIC on March 1. In addition to formal RAPdisclosure to the Urumqi public, the project office will provide separate resettlement information booklets,in Uygur and Chinese, to households to be affected in each year's construction season. The bookletsprovide information regarding the projected timetable, compensation standards, rehabilitation measures,and other aspects of implementation of direct relevance to affected persons. Grievance procedures also
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have been established.
Resettlement Cost and Implementation Schedule:
23. Based on preliminary data, the U'UTIP resettlement budget is estimated at US$44.2 million,including monitoring costs and contingency allowances. Estimated resettlement costs are included in theproject budget. The project owner has agreed to bear all resettlement costs, even if they exceed budgetestimates.
24. Based on the proposed project timetable, resettlement implementation for UUTIP will be carriedout in five years between 1999 and 2003. To ensure effective resettlement implementation, allresettlement-related activities are to be accomplished at least one month prior to commencement ofconstruction in any given area.
Monitoring and Evaluation:
25. Resettlement implementation will be subject to both intemal and extemal monitoring. The PROwill be responsible for submitting intemal monitoring reports to the Bank every six months. Externalmonitoring will be conducted by a team that is to function independently of the project owner. Externalreports, to be submitted to the PEO and the Bank every six months, will review whether implementation isin compliance with RAP terms, and will evaluate the adequacy of resettlement measures in improving orrestoring incomes and living standards.
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Public Consultation on Resettlement
Table 1: Main RAP documentDocument Language Disclosure Date Location Version DateRAP Chinese 1-20-00 XUAR Public Library 1-20-00
English 1-20-00 XUAR Public Library 1-20-00UJgur 1-20-00 XUAR Public Library 1-20-00
*Source: UMG release letters
able 2: Draf P te r 1999 Public Mee ing Document)Document Language Date of Location Version Date
DisclosureRAP Chinese Starting on At meetings in small 9-10-99
9-13-99 groups, 26 localneighbourhoodcommittees in each offour regions and onecounty subdistrict form9-13-99 to 9-24-99.Also at a big publicheld on 9-24-99
Uygur Starting on At meetings in small 9-10-999-13-99 groups, 26 local
neighbourhoodcommittees in each offour regions and onecounty subdistrict form9-13-99 to 9-24-99.Also at a big public
=____===________ held on 9-24-99Resettlement Chinese 9-14-99 Four regions and one 9-10-99Information county subdistrict officeBooklet(RIB) for and Yamalike districtWest-MiddleSection of ORR
Uygur 9-14-99 Four regions and one 9-10-99county subdistrict officeand Yamalike district
Table 3: Public NoticesDocument Language Date of Location Name of Newspapers
DisclosureRelease of RAP for West- Chinese 5-21-99 Chinese Metropolitan ConsumerMiddle Scction of ORR . Newspaper Morning NewspaperNotice for Availability of RAP Chinese 8-99 Chinese Metropolitan Consumerand EIA Summary Reports Newspaper Morning NewspaperNotice for Availability of RAP Uygur 9-99 Uygur Urumqi Evening Newspaperand EIA Summary Reports Newspaper
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AdditionalAnnex No.: 13
Review of Financial Management System(This Annex is an edited and updated version of the Review in the Project Files, less Attachments 2 -4)
I. Background
1. Scope/Objective of Review of Financial Management System. This report is the result of afinancial management review and analysis of the Urumqi Urban Transport Improvement Project (theProject) to determine whether the Project has in place an adequate financial management system as requiredby the Bank OP/BP 10.02. The review was perforned in accordance with the Guide for Review andDesign of Accounting and Reporting System for World Bank Projects (Prepared by COSU in December,1997) and the Review of Financial Management System as stipulated in Annex II of LACI (LoanAdministration Change Initiative) Implementation Handbook. The task team has discussed and reviewedwith Regional and Municipal Finance Bureaus, Project Executive Office and participating agencies of theProject, procedures and guidelines for establishing a sound project financial management system, includingstaff/training, accounting, internal control, reporting requirements, auditing and budgeting.
2. Project Objective. The objective of the proposed Project is to develop Urumqi's urban transportsystem as a means to facilitate the future growth, economic development and expansion of the city, andserve the development needs of the Xinjiang Autonomous Region, while improving the quality of life withinthe city.
3. Project Status/Schedule. The Project was appraised in January 2000. The implementation periodof the Project is scheduled to run approximately 5 years.
II. Organizational Structure/Institutional Arrangements
4. Organizational Structure/Institutional Arrangements. The overall responsible agency for theProject is Urumqi Urban Transport Improvement Project Executive Office (PEO). The PEO will report toa 'Leading Group', headed by the Vice Mayor of the Urumqi Municipal Government, and comprised of 21persons representing 18 agencies (Vice Secretary of Urumqi Municipal Government, MunicipalConstruction Commissions, Municipal Planning Commissions, Director of PEO, Governor of UrumqiCounty, General Manager of Urumqi Public Transportation Company, Vice leader of Urumqi TransportPolice Sub-Department; and the following 1 1 Municipal Bureaus: Finance, Planning, Land, PublicSecurity, Urban Construction, Transportation, Horticulture, Real Estate, Telecommunications, Statistic,and Environment Protection). The Project implementation will be undertaken at the Urumqi municipallevel, involving five agencies; Urumqi Municipal Engineering Bureau, Urumqi Public Security Bureau,Urumqi Public Transport Company, Urumqi Public Environment Bureau, and Urumqi Planning Bureau.In terms of project administration support, Project Management Offices (PMOs) will be established at eachof these agencies.
5. The financial accounting and reporting aspects of the Project are to be handled by the PEO andRegional Finance Bureaus (RFB). The Regional Finance Bureau's Finance Division will be responsible forthe monitoring, maintenance and reconciliation of the Special Account, for checking and monitoringwithdrawal applications and verifying that payment requests meet Bank requirements. Funds will flowfrom the Bank to RFB/PEO through on-lend arrangements and then onto vendor/contractors or PMOs.
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The Financial Department of the PEO has been set up and will report both to the Directors of the PEO andthe Municipal Finance Bureau (MFB). The Financial Department of the PEO will be responsible forcollecting all the supporting documents, monitoring contract payments, and preparing payment requestsbefore submitting to the RFB. The RFB will further verify, approve and process these documents beforesubmitting to the Bank for disbursements. (See Attachment 1 for Project Organization Chart)
6. Institutional Experience with Bank-Financed Projects. The RFB has had substantial previousexperience with Bank-financed projects and is familiar with existing disbursement, procurement, financialreporting and auditing requirements. However, the PEO and participating agencies are new to workingwith Bank projects. Therefore, training on financial management will be arranged for staff from the PEOand implementing agencies (see Section VII for details). To date, the RFB has managed about 5Bank-financed projects (e.g. Tarim Basin Agricultural Development, Tarim Basin II, Xinjiang AgriculturalDevelopment, Xinjiang Provincial Highways, Xinjiang Highway II).
IIL Project Structure and Costing
7. Financing and Cost Sharing. The financing of the project will be supported by IBRD (US$ 100million) and Government financing (US$ 150 million) for a total estimated project cost of US$ 250 million.The government financing is to be provided through municipal finance budgeting.
8. Loan Agreement Categories. These will include: civil works, goods, consultant services andtraining. The amounts and percentages of loan allocation will be discussed during appraisal and finalizedduring negotiations.
9. Project Components. The Project is comprised of the following five components:A. Road Network Development, mainly of an urban ring road;B. Traffic Management and Road Safety;C. Public Transport - reform and development;D. Environmental Management; andE. Institutional Development - Urban Transport System Management.
IV. Internal and Other Controls
10. Project Financial Management Systems Manual (FMS Manual). The objective of the FMSManual is to document the operational procedures and guidelines for project financial managementencompassing all levels of project management (i.e. RFB, MFB, PEO and implementing agencies). Thescope of the manual will encompass project financial management structure and staffing (e.g. organizationchart and job descriptions), identification of the accounting standards to be used by the Project and allimplementing entities, project reporting formats and procedures for cash management, asset management,procurement and disbursements, counterpart fund management, budgeting and auditing. A draft FMSManual as been prepared and provided to the Bank. A final version will be agreed by project launch andissued to all relevant staff who are involved with accounting and financial management.
11. Laws/Regulations. The administration, accounting and reporting of the Project are required to beset up in accordance with the following regulations/circulars as issued by the Ministry of Finance (MOF):
a. Circular #12: "Regulation for the Submission of Withdrawal Applications" issued Dec. 1996 -includes detailed procedures for preparing and submitting withdrawal applications and retention ofsupporting documentation.
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b. Circular #127: "Temporary Regulations on Financial and Accounting Management for ProjectsFinanced by the World Bank" issued in 1993 -provides the basis of accounting treatment forproject activities and guidelines for project financial management.
c. Accounting Law issued January 1985 with subsequent amendments - includes jobresponsibilities for cashiers and accountants and financial management recording and reportingrequirements.
d. MOF Agreement -An agreement has been reached with MOF on a standard set of financialstatements to be used by World Bank projects. This agreement supersedes the previous MOFCircular #6: "Temporary Regulations on Financial Management Reporting for Projects Financedby the World Bank" issued January 1997. The format of the financial statements included in thisMOF Agreement package is primarily based on the Construction Accounting Standard noted in 12below.
12. Standards. The Construction Accounting Standard issued by Construction Department, MOF forconstruction oriented projects dictates the format of financial statements, chart of accounts and relatedinstructions which would therefore affect project accounting and reporting requirements.
V. Project Accounting Standards, Financial and Management Reporting
13. Accounting Standards. The accounts will be prepared in accordance with the Circulars and lawsnoted in section IV above on an accrual accounting, double entry bookkeeping basis in accordance withChinese accounting standards. The Chinese accounting standard applied to infrastructure projects is veryclose to, and in some areas more demanding than the International Accounting Standard (IAS). Circular# 127 issued by the Ministry of Finance and referred to above is modeled after the principles of the IAS.The Circular provides more in depth instiuctions to assist in keeping detailed records of project accountingactivities.
14. Project Reporting. Clearance has been received from MOF on a standard set of project financialstatements which will be utilized by this project. hi terms of reporting cycle, the Project financialstatements (see Attachment 2 in the Project File for formats) will be submitted to the Bank bi-annually andinclude the following five statements:
I. Statement 1: Balance Sheet;2. Statement 2-1: Summary of Sources and Uses of Funds by Project Component;3. Statement 2-2: Summary of Sources and Uses of Funds by Project Component;4. Statement 3: Statement of Implementation of Loan Agreement; and5. Statement 4: Special Account Statement.
Each of the implementing agencies will be managing, monitoring and maintaining their respectivefinancial reports. Project accounting and reporting will be done by the Financial Department of the PEO.Discussions with Financial Department of the PEO staff have indicated that bi-annual financial statementswill be submitted to the Bank before April 15 and October 15 each year.
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15. Counterpart Funding. Counterpart funding is to be provided by the following:(a) Urban construction and maintenance tax;(b) Land use surcharge;(c) Water resources fee;(d) Drainage fee;(e) Urban public facility surcharge;(f) Tax/minibus operating bid charge;(g) Additional urban population fee;(h) Urban surcharge;(i) Road donation fee; and() Urban construction fee.
Each year, the Municipal Construction Commission will prepare a budget and send it to the MunicipalGovernment for approval before being submitted to the MFB. The MFB will provide their contribution tothe Project, based on the budget submission, and deposit these funds into accounts managed by theFinancial Department of the PEO. Procedures used in the budgeting process are detailed in the FMSManual and will be used as a guide for all parties involved.
VI. Special Account, Disbursements and Supporting Documentation
16. Special Account. The one Special Account under the Project, to be held in U.S. dollars, will bemanaged by the Project Officer, Finance Division, Regional Finance Bureau. The Project Officer willcheck and monitor withdrawal applications and verify payment requests to ensure that they meet Bankrequirements. Corresponding RMB bank accounts for Special Account related transactions will be held atthe Financial Department of the PEO and will be managed by the Accountant to review and preparepayment requests. (See Attachment 3 in the Project File for a Flowchart of Receipts of Bank Funding.)
17. Disbursements and Supporting Documentation. The originals of the support documentation andcopies of each withdrawal application will be maintained by the Financial Department of the PEO. Inaddition, necessary copies are maintained at the RFB. (In terms of disbursement application processingand clearance procedures, please refer to Attachment 4 in the Project File.)
VII. Staffing and Training
18. Staffing. As noted in Section II, the financial/accounting staff at PEO and implementing agenciesdo not have experience with prior Bank projects and accordingly are not familiar with the Bank'sprocedures and requirements. Consequently, well-designed and focused training will be arranged by theRFB to provide training to all relevant staff to ensure personnel of quality commensurate with jobresponsibilities. In addition, the Bank will provide as and when needed training in project financialmanagement. In terms of experience, the PEO has enrolled a Chief Accountant, (who has a Chinese CPAand has worked in a Accounting Firm for about 5 years), another CPA who will be responsible foraccounting and four other staff who are licensed accountants. Furthermore, as all accountants operating inChina are required to be licensed by the Financial Bureaus based on years of experience, performance anduniform examination, this requirement will be met by all implementing Accountants and Cashiers. (Thisrequirement is documented in the FMS Manual.)
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19. Training. It is suggested that training should be arranged for all relevant staff at the PEO, and thePMOs on the following:
(a) Bank procedures and requirements on the withdrawal of Bank funds;(b) Project financial statement formats;(c) Project Financial Management Systems Manual; and(d) Project audit requirements.
This training should be arranged by the Regional Finance Bureau and the PEO before projectimplementation. In addition, the Bank will provide as and when needed training in project financialmanagement.
VIII. Audit Arrangements
20. It is the Bank's requirement that annual project financial statements be audited in accordance withstandards acceptable to the Bank. In line with other Bank financed projects in China, the Project will beaudited in accordance with Govemmental Auditing Standards of the People's Republic of China (1997edition). The Regional Audit Bureau will be responsible for auditing both the Project and implementingAgencies. The audit will be scheduled for submission to the Bank within 6 months after the end of thecalendar year.
IX. Budgeting
21. Project level budgeting will be incorporated with the preparation of the counterpart fund budget, asnoted in Section V.
X. Issues/Proposed Actions
22. Financial Management Systems Manual. As noted in Section IV, a draft Manual has beenprepared and reviewed by the Bank. Before project implementation, this Manual should agreed and beissued to all relevant staff who are involved with accounting and financial management.
23. Training. As noted in Section VII above, staff at the PEO and implementing agencies shouldreceive training on the following:
(a) Bank procedures and requirements on the withdrawal of Bank funds;(b) Project financial statement formats;(c) Project Financial Management Systems Manual; and(d) Project audit requirements.
This training should be rendered at the Project Launch Workshop and/or before project effectiveness. (SeeAttachment 5 in the Project Files for Proposed Action Plan.)
XI. Conclusion
24. The financial management team has determined that the Project will satisfy the Bank's financialmanagement requirements as required by OP/BP 10.02. In terms of disbursement procedures, the Projectwill be disbursing based on the traditional disbursement techniques and will not be using PMR-baseddisbursements, in accordance with the agreement reached between the Bank and the China Ministry ofFinance.
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Attachment 1
CHINAUrumqi Urban Transport Improvement Project
(CN-PE45915)Project Organization Chart
RFB Leading(1) ~~~~~~~~~~~Group
PEO MFB(2) (3)
FDPEO(4)
Ununqi Unumqi Plublic Unmmqi Public Unimqi Public UrumqiMunicipal Security Transport EnviTonment Planning
Engineering Bureau Company Bureau BureauBureau(5) (5) (5) (5) (5)
Notes:(1) RFB-Regional Finance Bureau will be responsible and manage SA.(2) PEO-Project Executive Office will be responsible for the overall implementation of the Project.(3) MFB-Municipal Finance Bureau will be responsible for counter-part funds and Financial Departmentof PEO.(4) FDPEO-Financial Department of PEO will be responsible for accounting, reporting and financialmanagement of the Project.(5) Implementing Agencies.
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Attachment 5CHINA
Urumqi Urban Transport Improvement Project(CN-PE-4591 5)
Financial Management Action PlanDecember, 1999
Description 1 oBank Target DateI Responsibility Responsibility
A. Proiect Financial Manaaement Systems Manual __ ___ _ _
1. PFMSM issued to all relevant staff PEO/RFB T Disbursement by April 20011 1~~~ Officer. RMC byA
B. Training1. Project Launch workshop completed for all related PEO/RFB Disbursement by July 2000
staff on: Officer, RMCa. Bank procedures and requirements on thewithdrawal of Bank fundsb. Project financial statements formatsc. Project Financial Management Systems Manuald. Proiect audit reauirements _
C. Special Account
1. Get domestic clearances for opening of SA RFB Disbursement by February 2001Officer, RMC b eray20
2. Corresponding RMB bank account open PEO Disbursement by February 2001Officer. RMC
3. Send authorized signatures to MOFand then to RFB/MOF Disbursement by April 2001Bank Officer. RMC
4 Send first withdrawal application for initial deposit to RFB Disbursement by May 2001Bank ______Ofricer. RMC _____
MOF = Ministry of FinancePEO = Project Executive OfficeRFB = Regional Financial BureauRMC = World Bank Resident Mission, China
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AdditionalAnnex No.: 14
Socio-Economic Survey
Introduction:
1. As its name indicates, the Urumqi Urban Transport Improvement Project (WUTIP) includes a setof activities to improve traffic and transport management in Urumqi, a city of about 1.9 million people andcapital of the Xinjiang Uygur Autonomous Region.
2. Urumqi has an ethnically diverse population. While local ethnic minorities constitute a substantialportion of the population in many areas throughout the region, they represent only about 27% of thepopulation of Urumqi. Of this population, Uygurs account for 12.7% of the total, Hui account for 9.5%,Kazak account for 3.2%, Man account for 0.5%, Mongol account for 0.4%, Xibe account for 0.2%, Russaccount for 0.2% and Uzbek account for 0.1%. The local ethnic minorities defined as "minoritynationalities" in the Chinese administrative and legal system - are predominantly Muslim, and most speakone or more Central Asian languages.
3. Since project inception, the UUTIP task team has been mindful that special efforts may benecessary to ensure that project activities do not impose cultural-specific hardships on one or more ethnicminorities, and otherwise do not aggravate ethnic relations. The task team has undertaken a consultativesocial assessment process and other measures to review potential adverse impacts (and opportunities forimproved service) as a result of proposed public transport reform activities. This annex reviews the resultsof the socio-economic survey for public transport.
Objectives:
4. The consultative social assessment was intended to supplement separate social and economicanalyses during project preparation. The objectives were:
a) To assess the differential travel characteristics (pattems, needs and attitudes) of vulnerablegroup populations compared with the general population. The purpose of this analysis is toidentify the potential ways in which these groups may disproportionately benefit or sufferdisbenefits from the project. The study should also identify strategies as needed to ensuredistributional equity within the broader project design.
b) To the extent that vulnerable groups are more dependent on public transport, study theaffordability of existing public transport (defined as articulated, regular and mini-bus) services forthese groups, and explore their willingness-to-pay for improved services. This analysis will assistin analyzing the fare increase issues and service improvement proposals in order to support thedesign of the public transport reform and development component.
5. The Study's Draft Final Report was completed in October, 1999 and the report was finalized inApril 2000. Preliminary results are presented below:
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Geographical Distribution:
6. The main centers of minority population are concentrated in Tianshan District, Uraumqi County andSaybagh District:
(% share of total minority population in District, % share of District population which is Minority)1. Tianshan District (28.7%, 30.3%) 2. Saybagh District (19.9%, 23.3%)3. Xinshiqu District (12.6%, 17.8%) 4. Shuimogou District (6.5%, 24.2%)J. Toutunhe District (7.4%, 28.5%) 6. Nanshan Mining District (0.3%, 7.2%)7. D)ongshan District (4.0%, 19.0%) 8. Urumqi County (20.6%, 55.4%)
7. Transient populations are concentrated in Saybagh (long-stay transients) and Tianshan(short-stay), (the railway station and bus stations are also situated in these districts). The analysis of thepoorest (persons who receive the "Lowest Life Guarantee" fund) show their concentrations in SaybaghDistrict and Tianshan District. The poor also reside in Nanshan Mining District and Shuimogou District.
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Income and Expenditure:
8. Household economic status is closely related to household size:
Notes:1. The household population and household income of transient population in different categories are
calculated based on the population living in Urumqi City.2. "General" refers to permanent and non-poor population.3. "Han" refers to permanent, non-poor Han population.
Transit Demand (by group):
9. Apart from minorities, where usage of public transport is generally in line with the generalpopulation, it appears that there is higher usage of public transport amongst women, the transient(especially the labor contingent) and the poor. The majority of people are satisfied with current publictransport services. In fact, compared with the general population, it appears that vulnerable groupssurveyed are more satisfied with existing public transport. However, they feel that bilingual services arelimited and need improvement.
10. However, public transport coverage, choices and services appear to be worse in outlying areaswhere there are higher concentrations of vulnerable group populations, e.g. Yamalike (minority, transient)and Dongshan (poor) districts. Specific issues relating to on-street operations of buses were also cited asneeding improvement.
Minorities: Minority usage of public transport is generally in line with the broader population,though there are variations in usage patterns amongst minority groups. Service coverage is low forsome Uygur neighborhoods (Yamalike area). Minority transport expenditures are likely to be moreburdensome (due to larger family sizes for a given income among Uygurs and longer than averagebus trips taken by Huizu) but not prohibitive. Cultural factors appear to be a more significantfactor in the choice of public transport modes (cheap bus vs. higher-priced minibuses) thaneconomic status. About half of the minorities surveyed are willing to pay more for improvedservices, in particular for comfort and more access to seats.
Transient Population: The transient population should be analyzed as two groups: laborers andother non-permanent populations (business travelers). Laborers are more likely to take buses andwalk than the general population. The ratio of transport expenditure to income is highest for
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transient populations, reflecting the importance of transportation to their livelihood activities. Ininterviews, 60% of respondents were willing to pay more for improvements such as speed, comfortand seats.
Women: Women's average income and access to cars and motorcycles is lower than men's; amongthe poorest, there is a higher proportion of women than men. For all trips, women are more likelyto walk or take buses than men, while men are more likely to use taxis, bicycles and companyminibuses. Women also have a higher transfer rate and travel with children more frequently thanmen. In terms of public transport usage, women are more likely to take cheaper regular andarticulated buses than men. They also appear to have less on-board access to seats than men.Controlling for income and sex, cultural factors appear to influence the choice of public transportvehicles. Minority women are more willing to pay for higher-priced (minibus) services than Hanwomen; the opposite is true for Han and minority men. Overall, about 50% of women were willingto pay for improved services.
Poor: It is difficult to identify the poor. The approach of using social safety net welfare rolls istoo narrow, even for identifying the poorest (less than 1%). From the limited data collected in thisstudy, there was evidence of measurable relationships amongst the vulnerable groups: e.g. highshare of labor portion of non-resident populations is poor; women represent a higher proportion ofthe poorest; minority households earn lower than average incomes. In general, the poor have alower trip rate and are more captive to walking than the general population. They depend on thecheapest buses (articulated or unit-owned) and are more likely to experience longer wait times.The poor seldom use bicycles. Few of the poor are willing to pay more (for both existing andimproved transit services); however if there were no choice, they would want shorter wait times.
Affordability of Public Transport Fare Increase:
11. Almost a third (28%) of the groups surveyed would accept a fare increase today (withoutaccompanying service improvement), but the majority (65%) would oppose a fare increase alone, as theyfeel current fares are a fair price for the services offered. Amongst minorities, women and transients, thereis some willingness to pay for improved services (see above) although respondents were skeptical aboutthat improvements would actually be made. Thus, any fare increase should be modest and should beimplemented in tandem with comprehensive network improvements and reform of the organization of thepublic transport sector, taking into account relative differences in the pricing of services in differentmarkets (and resulting likely mode shifts).
12. Generally, the poor are not willing to pay more for public transport services. If fares are raised, itis recommended that subsidies to the poor should be given directly to users (rather than to operators) and ina measurable form in order to prevent discrimination. These recommendations will be further studied andincorporated into TA on public transport reform and finance.
Conclusion:
13. These findings confirm the importance of public transport and traffic management measures toensuring equity in project design. To the extent that improvements are made to pedestrian and publictransport systems, surveyed groups will benefit as much as or greater than the general population. Publictransport fare increases should continue to be considered in conjunction with meaningful reform and serviceimprovement proposals.
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14. The design of project components is consistent with Study findings (including proposed TA onurban transport policy, road user safety and public transport network improvements). Sub-projects toimprove public transport access and facilities at the Railway Station and Hongshan Market willparticularly address the needs of all surveyed groups whose residential patterns appear to be highlyconcentrated and overlapping in the Yamalike area (Tianshan and Saybagh Districts).
15. The Study was completed in April 2000. Follow-on studies are proposed to further investigategender and poverty issues. Some funding has been obtained.
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AdditionalAnnex No.: 15
Ethnic MinoritiesIntroduction:
1 . Urumqi, a city of about 1.9 million people and capital of the Xinjiang Uygur Autonomous Region(XUAR), is ethnically diverse. Since project inception, the UUTIP task team has been mindful that specialefforts would be necessary to ensure that project activities do not impose cultural-specific hardships on oneor more ethnic minorities, and do not lead to ethnic tensions. This annex reviews steps taken during projectpreparation to assess whether any ethnic minority would be subjected to any group-specific hardships, toconsult with potentially affected members of minority groups regarding their concerns, and to ensure thatadequate attention is paid to treatment of ethnic minorities during project implementation.
Ethnic Minorities in Urumqi:
2. While ethnic minorities constitute a majority of the population in many areas of XUAR, theyrepresent only about 27% of the population of Urunmqi. Of this population, Uygurs account for 12.7% ofthe total, Hui account for 9.5%, and Kazakh account for 3.2%, with smaller proportions of 42 otherminorities also living within the city.
3. Statistical diversity only presents part of the complexities of the multi-ethnic city. The Uygur, Hui,Kazakh, and other ethnic minorities are officially designated as "minority nationalities" according to theChinese administrative and legal system. But there are many differences among minority nationalities.Many minority nationalities are Muslim while others are not. In some areas, minority nationalities live inconcentrated communities while residential patterns in other areas of the city are more interspersed. Somegroups, notably the Uygur, have a different language and script. The Hui, by contrast, speak standardChinese and use Chinese script.
4. The vast majority of city residents have one thing in common, however: they or their parents havemigrated to Uruniqi over the last few generations, and have adapted in many ways to Urumqi urban life. Inthis Urumqi context, members of ethnic minorities do not participate in the full range of customary socialand political institutions that they have elsewhere in Xinjiang or China. As urban residents, moreover, theywould be expected to share in the benefits derived from public infrastructure or public serviceimprovements.
5. Minorities such as the Uygur, Hui and Kazakh are officially designated as "minority nationalities"in the Chinese administrative and legal systems, and are afforded special protections and privileges underChinese law where they live in "concentrated communities." Because OD 4.20 suggests that countrylegislation can provide a prelimninary basis for determining groups to which the policy is targeted, the Bankhas tended to view all of the 55 officially designated "minority nationalities" in China to be "indigenouspeoples" for initial identification purposes.
Sequential process to determine the applicability of OD 4.20:
6. Because of the presence of Uygurs and other groups that are treated as minority nationalities underChinese law, the task team was aware that it would need to consider whether the safeguard provisionscontemplated under OD 4.20 should apply to the project. The following sequential process was used todetermine the applicability of OD 4.20 on a project specific basis.
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7. First an examination was made as to the degree to which the people potentially affected have thecharacteristics set forth in paragraph 5 of OD 4.20. The OD acknowledges that no single definition cancapture the diversity of indigenous peoples, but suggests use of five identifying characteristics. Reviewingthese in the Urumqi context results as follows:
(a) "Close attach'ment to ancestral territories and to the natural resources in these areas." TheUrumqi urban area was never ancestral to the Uygurs, the Kazakh or the Hui. Most minorityresidents affected by the project have migrated to the city during the last half-century, rather thanhistorically inhabiting the area.
(b) "Self-identification and identification by others as members of a distinct cultural group."Without doubt, the Uygur, Kazakh and the Hui so identify and are identified.
(c) "An indigenous language, often different from the national language." This is true for theUygurs and Kazakhs, but not for the Mandarin-speaking Hui.
(d) "Presence of customary social and political institutions." For the Uygurs and others, manysocial institutions retain their customary strength (kinship, communal associations, etc.) but nottheir political institutions.
(e) "Primarily subsistence-oriented production." Clearly not. Furthermore, in the two Uygurethnic neighborhoods most directly impacted by the project (specifically the ring road), the majorityare migrants from agricultural areas of southern Xinjiang currently working as miners, pettyentrepreneurs, and wage laborers.
8. While the minorities of Urumqi are clearly ethnic, the above review of the defining characteristicsgives only an equivocal answer. While these ethnic minorities display some of the required characteristics,other characteristics are missing. However, the OD also enjoins the exercise of "judgment in determiiningthe populations to which this directive applies." Thus the task team found that it was necessary to considerother criteria.
9. The second criterion applied was to examine if there are significant impacts on distinctivecultural or economic ways of life. The task team has concluded that no such impacts can be expected tooccur:
* Where acquisition of cultivated land affects members of minority nationalities, they are alreadymembers of multi-ethnic locales. Rehabilitation measures are the same for all residents.
* The project does not affect herding areas, natural resources, or any income-earningopportunities upon which minority nationalities rely.
* The project does not appear to affect cultural institutions or practices (apart from threemosques impacted by the project which received special attention), and there is no reason tobelieve that it may do so.
* Relocating households will get new housing and are likely to enjoy improved living standards.* In consultations to date, members of minority nationalities have primarily been concerned with
terms of resettlement, and not with cultural or ethnic sensitivities.
Based on this analysis, the task team concluded that affected members of the minority nationalitieswere to be affected as individuals or households, in the same ways as other residents in the project area.
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The minority nationalities are not affected by this project in any way that makes them vulnerable tospecific, group-based hardship as an ethnic group or ethnic community.
10. The third criterion considered was the ability of affected minority residents to assert theirinterests and rights. The task team also concluded that, although minority nationalities may sometimes berestricted in their capacity to defend their interests, especially in politically sensitive circumstances, themembers of minority nationalities potentially affected in UUTIP have been able to assert their interests andnghts in the many fora provided by the Bank and the project authorities, and are represented at differentlevels of the project management team and local government. Relevant documents have been disclosed inUygur and Chinese, and local languages have been employed in the solicitation of minority residents'views. Bilingualism and delivery of information in Uygur and Chinese is official UMG policy. Continuedconsultations during project implementation have been agreed with UMG, are set out in the RAP, and arecovered by the Legal Agreement.
11. Based on the process set out in paragraphs 7-10, the specific circumstances of this project, andfrom the perspective of prior Bank practice, the task team concluded that the Uygur people in theLiudaowan and Yamalike neighborhoods of Urumqi, as well as the other ethnic minorities in Urumqiaffected by the project, are not covered by the provisions of OD 4.20. However, the task team was awareof the need for sensitive and prudent treatment of issues regarding minority nationalities, even though OD4.20 does not apply to the project.
Description of Components Likely to Affect Ethnic Minorities:
12. UUTIP consists of five components:A. Road Network Development, mainly of an urban ring road;B. Traffic Management and Road Safety;C. Public Transport - reform and development;D. Environmental Management; andE. Institutional Development - Urban Transport System Management.
Only Components A and C are likely to have any direct adverse impact on individuals or communities,including members of ethnic minorities.
13. The development of a 31.25 kilometer urban ring road will affect Urumqi residents primarilythrough demolition of structures on land required for road use. In all, 854 households will be required torelocate to new residences. Of the 854 households, 261 are members of ethnic minorities. The proportionof ethnic minority households to the overall number of households (31.9%) is slightly above the proportionof minority households in the overall Urumqi population (about 27%). A Resettlement Action Plan (RAP)has been prepared by the borrower, and provides an adequate basis for mitigation of all identified adverseimpacts (Details are given in Annex 12).
14. The public transport component will consider potential improvements to system efficiency. Thecomponent could lead to fare increases, route changes, bus stop changes, route frequency changes and otherchanges that would affect individual members of ethnic minorities, along with the general population. Asocio-economic survey and public consultations were carried out from April to September 1999. Initially,these exercises were intended to assess whether reform activities could systematically disadvantage one ormore minority groups. In the design phase, however, the survey and consultations were broadened to focuson travel characteristics, attitudes and preferences of four demographic segments of the population:minorities, transients (non-resident), women and the poor. Results are discussed in Annex 14.
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Actions Regarding Impacts and Issues of Concern to Minority Nationalities:
15. Extensive consultation (as described in Annexes 11 & 12) was carried out in the preparation of theEnvironmental Action Plan (EAP) and Resettlement Action Plan (RAP). Documentation and consultationwas in spoken and written Uygur as well as Chinese. The documentation and the consultations providedthe opportunity for minorities to make informed judgments and to express their views.
16. A socio-economic survey (described in Annex 14) was undertaken to examine the travel patterns ofvulnerable groups (including ethnic minorities), and to assess the affordability of existing public transportservices and proposals for fare increases. Measures to address concems raised in these surveys includingupgrading bilingual on-vehicle services, are being incorporated into the detailed design of the Component CPublic Transport of the project. It has been agreed that these measures will be monitored annually.
17. For Component A Road Network Development, planning and design of the ring road sought tominimize bifurcation of communities and impacts on culturally sensitive buildings (specifically mosques),avoid sensitive areas (specifically Muslim cemeteries), and ensure continuity of pedestrian access.Particular care was taken in the predominantly Uygur community of Yamalike and the mixed Uygur andHan community of Liudaowan, where sections of the ring road are not based on existing roads.
18. Civil works for the ring road improvement will require demolition of one mosque (LanzhouMosque in Jinyingda Road) to the east of the CBD. The present mosque, housed in a former commercialstructure of no cultural or architectural significance, is overcrowded. In consultations with the mosquecouncil, a relocation site has been agreed, and compensation will be sufficient to build an improvedstructure with a larger holding capacity. Mosque leaders have indicated to the resettlement planners, to theBank task team, and to the international anthropologist (see below), that they are pleased with therelocation site (close to the existing mosque) and the prospect of a larger, more modem facility.
19. A review of potential impacts was undertaken by an international anthropologist with extensiveChina experience mid way through project preparation. The review confirmed that these impacts had ingeneral been adequately addressed but that continuing attention should be paid to the horizontal and verticalalignment and design of the ring road in the Yamalike area and in the vicinity of mosques, and to provisionsfor mitigation of adverse impacts in these locations.
20. Later in the project preparation, community screening was undertaken by an independent nationalconsultant, (advised by the international anthropologist) as a check on the ethnic communities potentiallyaffected by the construction of the ring road. This screening confirmed that Yamalike was the mostaffected area, but that a small ethnically mixed community in the Liudaowan area was also affected.
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Yamalike:
21. The Yamalike area is a largely squatter settlement on a hill in the south of the city, and to the westof the CBD. It is bounded on the north by Nanliangpo Road, on the east by Baoshan Road, and bifurcatedby the railway (see Map IBRD 30808R Road Network Improvements). It was identified early in projectpreparation as an ethnically sensitive area. The railway and the proposed ring road pass through thecommunity partly in tunnel. As a result there has been extensive consultation, as listed in the table, anddiscussed below.
(a) Two Yamalike resident committees were interviewed during development of terms ofreference for the environmental assessment in mnid-1998. At that time, the proposed alignmentskirted Yamalike Mountain rather than tunneling through it. As this alignment would have led tosubstantially more residential and commercial displacement, attention at these interviews focusedlargely on resettlement issues.
(b) A small-scale questionnaire was distributed in the Yamalike area, asking respondents toconsider the proposed aligrnment and an altemative tunnel design that would have emerged througha minority graveyard.
(c) Yamalike residents were invited and participated in a first environmental assessment publicmeeting, in December 1998. As the proposed alignment at the time of the meeting continued to goaround Yamalike Mountain, concerns from Yamalike residents raised at the meeting focused on thenecessity of displacement and resettlement terms. In addition to discussion at the public meeting,these issues also were raised by Yamalike residents utilizing the telephone hot-line establishedduring the project preparation process.
(d) Yamalike households were surveyed again in August 1999 regarding housing built withoutrequisite permits and the appropriateness of resettlement measures for residents in such structures.All but one of the 24 households included in the survey were minority households.
(e) A second public meeting was held in September 1999, again with Yamalike residents inattendance. As the present tunnel alignment had been chosen by this time, in part to minimizeresettlement elsewhere in the Yamalike area, no Yamalike issues arose at this meeting.
22. These consultations provided input to several major redesigns that were undertaken of the ring roadthrough the area. There were adjustments to both the horizontal and vertical alignment in order to reduceland take and mitigate adverse impacts. The objective was to bring the road as close as possible to theexisting rail line in order to minimize additional community severance and to reduce the resettlement andenvironmental impacts. The existing access road into the area is to be upgraded with a bridge across thering road, so as to maintain community movements to the existing elementary school and mosque, and toallow bus services to penetrate the area. The existing local Guangming mosque is retained, and pedestrianaccess to the mosque is maintained. Adjacent to the mosque the road is in cutting to lower noise levelimpacts.
23. The project will affect households lacking legal residency status. RAP policy terms requireequitable treatment of unregistered residents, regardless of ethnicity. Following consultations with affectedresidents, a scheme to provide replacement housing with modem services (the present site lacks runningwater) and improved public facilities on subsidized terms has been devised. In addition, households
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between the ring road and the railway and cut off from the rest of the community are to be resettled, eventhough their houses are not physically affected. Residents have indicated to resettlement planners, to theBank task team, and to the international anthropologist, that they are satisfied with resettlementarrangements.
Liudaowan:
24. Liudaowan is the north east of the city. It is on the edge of a coal mining area. The preliminaryalignment of the ring road in this location was not selected until late in project preparation (as is customaryin road projects where alignments change during preparation). As a result, no specific consultations(beyond those undertaken for resettlement planning or environmental assessment purposes as shown in thetable) were undertaken during project preparation. Additional consultation is necessary. This additionalconsultation will occur early in project implementation, to permit the results to be fed into the final designprocess for the ring road.
25. Since part of the ring road alignment in this area was not on existing roads, as part of the designprocess, care has been taken to reduce impacts on communities. Urban arterial road standards have beenadopted (in lieu of expressway standards used elsewhere). These provide a normal urban main road crosssection, with at grade pedestrian crossings and therefore less physical impact. As described in Annex 1 1,ring road planning included the identification of several altemative alignments (in conformity with theMaster Plan). These were compared on technical, environmental, and social grounds before selecting theproposed preliminary alignment, to minimize resettlement and impacts on communities, and to avoid areasaffected by coal mining.
26. The alignment selected appears on aggregate best able to best satisfy all criteria, and is designed toavoid the local mosque. For most of its length, this alignment is through open space, but it includes a 100meter section through a community containing a mix of minority groups and Han. Resettlement of 31 Hanand 34 minority households, currently living in substandard housing to higher standard housing close totheir existing location is included in the project.
27. This section is to be built in year 4 of ring road construction (2003). The technical, environmentaland social aspects of the proposed alignment and mitigation measures required will be evaluated in detail aspart of the final design process. Environmental and social review of the design will be jointly conducted byChinese authorities and the Bank.
Continuing Consultation and Monitoring:
28. Arrangements have been made to continue consultations throughout project implementation in thetwo predominantly Uygur neighborhoods affected by ring road construction. Consultation with individualhouseholds on details of resettlement will be undertaken by the project resettlement team starting 12 monthsbefore the scheduled start of construction activities. Community consultation will be undertaken early inproject implementation by independent local consultants. They will be guided by the independent nationalexpert (advised by the international anthropologist) who undertook the community screening. Activitiesrelated to resettlement of members of minority nationalities will be included among subjects covered underindependent project monitoring. Resettlement and development of transport reform strategies will besubject to direct Bank supervision.
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Record of Consultations in
Yamalike and Liudaowan Areas
No. Date Discussion scope PurposeI March-May Land, house and other Census and socio-
1999 asset loss, PAPs' economic survey for RAPconcerns and preparationsuggestions, etc. _
2 July 1999 PAPs' living conditions Non-licensed householdand their opinion about sampling for RAPresettlement preparationarrangements, etc. (Yamalike only)
3 August- Land, house and other Supplementary survey forSeptember asset loss, PAPs' RAP preparation based1999 concerns on design changes
and suggestions, etc.4 March 200q Land measuring and Data verification
ground attachment according to constructionchecking, etc. design documents for
resettlementimplementation
5 June 2000 PAPs' concerns and Preparation fortheir opinions about resettlementresettlement implementationarrangements, etc.
6 August Public opinion (for For EIA TOR preparation1998-June details, refer to Section1999 6.3 of EIA)
7 December Potential environmental First public meeting for28, 1998 impacts and related EIA preparation
suggestions8 June- Potential environmental For EIA finalization
September impacts and mitigation1999 measures
9 September Project information Public hearing for both24, 1999 introduction and public RAP and EIA preparation
opinion
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AdditionalAnnex No.: 16
Project Summary Technical AnalysisProject Preparation
1. Technical assistance. The technical capacity of local institutions in Urumqi and XinjiangProvince was limited, and so the PEO required significant technical support for project preparation. Earlyin the process, 1 1 person-months of TA over a 4 month period financed through Japanese Consultant TrustFunds provided technical support for traffic model development and road network planning and in theinitial scoping of the traffic management and public transport components. This was followed by transportmodeling and preparation of domestic feasibility Studies by domestic consultants (funded partly through aPHRD grant) whose skills were developed through TA provided under the two Shanghai MetropolitanTransport Projects. These studies were in tum followed by comprehensive PHRD-funded technicalassistance and training (12 person-months over a 4 month period) for the economic evaluation of theproject, the further design of the traffic management and public transport components, and the preparationof the PIP. Separate assistance finded by Canadian Trust Funds provided training and support to localagencies on the environmental aspects of the project throughout preparation.
2. Transportation Planning. Local capacity in transportation planning was somewhat developedfrom recent implementation of the Hetan Road urban expressway project, and work with Tongi Universityin 1993 on modeling for initial work on the updating of the Master Plan. However, due to limited scope ofthe modeling, and the age of the data, the PEO agreed to develop a new travel demand model, to generatetraffic forecasts and to evaluate project benefits. City-wide home-interview and traffic surveys wereundertaken in 1998. Technical planning issues focused on questions of model structure and planningassumptions, including projections of motor vehicle fleet growth. Several of these assumptions were latertested in sensitivity analyses under project economic evaluation. The World Bank provided direct technicalassistance to the Shanghai City Comprehensive Transport Planning Institute (SCCTPI) which undertookthe modeling.
Road Network Development
3. Ring Road. The technical approach for this component began with traffic projections whichindicated the need for major investment in transport network capacity to meet future travel demand,particularly in the Northwest-Southeast direction and in the CBD. Analyses of the current major highwayfacilities, including Hetan Road and provincial highway network also indicated the need for a high-capacitydistribution network to support development plans to the north and west of the city. Although the RingRoad had been identified in the Road Master Plan, altematives were considered, both strategically (in termsof other possible major network investments) and via standard altematives analysis of the "preferred"investment (alignment, layout, scale, and standards). Altematives considered are described in Annex I 1,Environmental Assessment and Environmental Action Plan. Strategic network tests are summarized inAnnex 4: Economic Analysis.
4. Section-by-section technical analyses of the preferred altemative were performed on a continuousand iterative basis using technical judgment and current modeling techniques. This approach - whichbalanced a design's financial cost and impacts (land take, enviromnental impacts) against traffic volumesand system benefits - was used as a means to "right-size" the facilities in lieu of full economic analysis ofeach design option. To conduct a full cost-benefit analysis of each design option would have required
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extensive modeling of project benefits (in terms of travel time and vehicle operating cost savings), the timeand financial cost of which was considered prohibitive by UMG. Technical review resulted in revisions tothe horizontal and vertical alignment, scale, layout and lane configurations of each section of the RingRoad, as well as specifications of construction design, method and materials. Technical work isdocumented in the various Ring Road Feasibility and Modeling Reports and Mission Aide-Memoires (seeAnnex 8).
5. Other Road Network Improvements. Since 1995 Urumqi has undertaken a major roadwayupgrading program to bring arterial and secondary roads up to a new pavement and geometric standard.This component addresses the needs of the 2000-2005 upgrading program. For later years, this work willbe carried forward in the proposed Transport Network Development Program Study.
6. Road Maintenance. Technical analyses of road maintenance included review of the road networkby functional class; local estimates of road condition (85% of arterial and secondary network is consideredin good condition); and the organization, efficiency and financing of maintenance activities. The MunicipalEngineering Management Bureau oversees a number of Maintenance Units organized by geographic areaand type of facility. Maintenance Units are contracted to implement mutually-agreed annual maintenanceplans for a given budget. Due to inadequate funding levels, however, nearly all the maintenance units findit necessary to engage in privately contracted work to supplement government funding to complete theannual maintenance program.
7. Present methods of maintenance planning and programming are limited, relying on semi-annualvisual inspections and technical judgment. Work planning by the maintenance units is conducted only onlarger rehabilitation projects and periodic maintenance work. Routine maintenance work follows anestablished procedure. Administrative and financial systems are inefficient and labor-intensive.Maintenance methods tend to be labor intensive with minimal use of equipment, which generally requireupgrading. Many of the work crews involved in small maintenance works include a large percentage ofwomen.
8. Actual maintenance expenditure is estimated at an average of 4.1 RMB/sq. meter for all roads.Expenditure by road category is estimated as: Arterial (5.5 RMB/sq. m.); Suburban (secondary) roads (3.5RMB/sq. m.); Expressway (4.5 RMB/sq. m.); and Local Roads (2.5 RMB/sq. m.). These unit costssuggest an annual road maintenance budget (excluding drainage, green space, etc.) in the order of 34million RMB based on the total road area. Road maintenance funding in 1998 was approximately 23million RMB as provided by the Engineering Management Bureau to the Arterial and SuburbanMaintenance Units. These maintenance units are engaged in some commercial work to earn additionalrevenues to supplement funding from government contracts. The Expressway Maintenance Unit funds itsmaintenance from tolls collected from expressway users. The other four Maintenance units receive theirmaintenance funding from a combination of Municipal and Local Government funds.
9. The analysis provided an insufficient basis for identifying the maintenance budgets that would berequired on long term basis to meet internationally accepted standards, with efficient operations. Themaintenance management systems to be implemented in the project will assist in defining the budget needs.Actual budget allocations based on these needs will be the subject of discussion during the annual review ofthe project.
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Traffic Management
10. The technical approach to the design of this component was mindful of the constraints within the
sector, including:(a) lack of a comprehensive approach and coherent traffic management policies andstrategies (there is no single agency responsible for traffic management);(b) little experience or expertise in traffic management, planning and design;
(c) focus on vehicle flow and enforcement; and(d) reactive problem solving stance (limited prevention practices).
As elsewhere, ownership of new ideas is fairly strong for new technologies, but less so on lower-costmethods and planning strategies. Within this context, a "bottom-up" and collaborative approach between
the TA consultants and the local team was adopted focusing on junction channelization, signalization, bus
priority measures, accident and parking research.
11. Junction Channelization and Signalization. In addition to city-wide traffic surveys, traffic
counts including turning movements were undertaken in support of channelization and signalizationschemes at 43 intersections. Channelization schemes included extensive consideration of pedestrian safety
as well as efficiency of motor vehicle movements. One pelican crossing (mid-block signalized pedestriancrossing) will be piloted in the project.
12. Bus Priority Measures. On-board bus surveys were undertaken in support of a 6 km. pilotscheme on the Youhou Rd.- Yangzijiang Rd.- Changjiang Rd. corridor which has passenger flows of over100,000 passengers per day. These were complemented by stationary observer surveys to cross-checkdata. The technical work stressed analysis of the locations and causes of delay, and the siting and design ofbus bays (double width leading to bus lane). This work involved pioneering collaboration between UPSB,
UPTC, and UMEB, and will be carried forward through the inter-agency traffic management group to theproposed bus route network and priority studies.
13. Parking and Accidents Research and Analysis. Road accident analysis and parking studies will
focus on data collection and analysis, toward the implementation of pilot programs.
Public Transport
14. Analysis was undertaken to determine current levels of demand and supply of services (by UPTCbus and minibuses and non UPTC minibuses); costs, efficiency and cost recovery of UPTC operations;sector finances and the current licensing and regulatory arrangements for service provision. Extensivediscussions were held with UMG to determine the existing policy framework and proposed changes, and
with UPTC to determine their business development strategy, and with both UPTC and UMG to detailreform measures under consideration. UPTC proposals for sub-components were analyzed in terms ofcost-effectiveness and support for reform. Further studies to support reform and refine the sub-componentsare proposed in the initial years of the project, including: the refinement of public transport regulatory
policies, the future route network, and the UPTC 5 year Corporate Plan. Provision has been made in the
component for additional bus priority measures (or other investments to support UPTC reform) to beidentified by these studies. The studies will be one of the topics of discussion at the annual review of the
public transport sector strategy.
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Environment
15. Baseline air quality and noise monitoring and modeling of alternative future scenarios (includingwith and without project cases) were used to evaluate the project and determine environmental impacts andmitigation measures. Project preparation also involved training on and development of Urumqi's MotorVehicle Emissions Control Program. Further details are provided in Annex I 1.
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