World Bank Infrastructure Note

8/13/2019 World Bank Infrastructure Note

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Istanbul Conference on SomaliaInfrastructure: Considerations and Needs

May 2012

Part 1:Delivering infrastructure in fragile/insecure contexts:

considerations and pre-conditions

1. In any country, investments in core national infrastructure underpin economicdevelopment, increasing connectivity and growth and creating access to basic services, serving tostrengthen the relations between state institutions and citizens. In fragile and conflict-affectedcountries, infrastructure can play an even more important role: providing the economic basis for asustainable transition to peace and allowing key stakeholders to have a stake in stability. As the2006 Somalia Reconstruc tion and Development Program (RDP) noted: Rehabilitation of

infrastructureprovides opportunities for enhancing the dialogue and cooperation betweencommunities around improving common infrastructure assets, as part of peace building efforts.

2. Getting infrastructure investments right is complex and requires some minimum operatingconditions to be in place on the ground. In large parts of Somalia, these conditions have notexisted during the RDP period and, as a result, important investments have not been able to

progress. A careful assessment of whether these conditions now exist will be necessary beforemoving ahead.

3. At a minimum, infrastructure development requires the maintenance of a peaceful political and security environment, law and order, and a basic institutional framework. Wherethese conditions are absent, it will be difficult to attract the substantial financing and privatesector participation that infrastructure can absorb. Worse, infrastructure investments can also

exacerbate conflict, especially where different actors contest land and resources and an injectionof investment could provide a focus for spoiler activity, community-based conflict or a suddenincrease in corruption.

4. Institutional strength is therefore the key factor behind successful investments ininfrastructure. From informal land management and consultative processes and decision-making

bodies within communities to the wider national institutions tasked to plan, execute, regulate andmanage infrastructure as well as arbitrate in disputes, institutions at both the national and locallevel will determine the outcomes of infrastructure investments.

5. Part 1 of this note briefly assesses the main basic minimum standards that would benecessary to facilitate investments in substantial infrastructure projects in a context like Somalia.Given Somalias highly heterogeneous regional context , the considerations may help decision-

makers prioritize and sequence investments according to their feasibility.Stability, security and the rule of law

6. A critical precondition for infrastructure is the exercise of credible, sustainable controlover a project area by legitimate and recognized authorities. Infrastructure projects require year-round access to project sites by contractors, overseers and government partners as well as bysupervisory agents. Rebuilding a road or a power plant before areas are under the control of theauthorities (who also will need to have de-mined the areas) risks playing into the hands of spoilerswho will be able to divert revenues through roadblocks or otherwise capture rents.

7. Moreover, stability needs to be sustained. Contractors and financiers need confidence thatgovernance in an area will not be contested for the project duration. Most fragile states with weak

institutions and legal frameworks lack the ability to enforce contracts, undermining investor and business confidence and leading to a situation where only politically connected business-peoplecan operate. In the south-central region of Somalia, this will present a particular challenge as the


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security and political situation remains fluid and area governance is often contested as differentactors lay claim to authority.

8. Many fragile and post conflict situations also face the challenge of establishing clear landtitle, resolving disputes over land and establishing the policy and mechanisms for communityconsultation, restitution and potentially resettlement. Land grabbing, unclear or missing title

deeds, the absence of a cadastral history and a weak judicial system can block greenfieldinfrastructure unless government land is available. Community consultation is central to anyinfrastructure planning process given the key role clan elders play in the resolution of inter-clandisputes, including related to land tenure.

9. In contexts where basic security conditions do not apply, community-based models ofinfrastructure delivery are the best option and can be delivered as a component of a wider peace-

building approach. Labor-intensive works and community consultation and contracting are auseful means of generating employment as well as consensus-building within contested areas.This approach limits the range of infrastructures that can be provided.

Public sector institutional capacity

10.

For projects larger than community-based infrastructure, public sector capacity tooversee, manage and maintain investments is critical. Larger infrastructure investments requireinstitutional oversight throughout the project cycle from the development of master-plans andfeasibility studies, through procurement, project oversight and contract management, utilitymanagement and finally in operations and maintenance (O&M). Water, power and roads alsorequire sectoral regulatory capacity to set generic and appropriate standards for civil works (roadwidth for example), to facilitate the negotiation of public-private partnerships and to regulateutility pricing. While not best practice in most developing countries, fragile and conflict-affectedcountries rely on program implementation units working within line ministries to supportgovernment-led implementation. In Somalia, such units can engage in the first phase of basicinstitutional capacity building and should be strongly encouraged as part of program design.

11. Public-sector management of infrastructure projects in fragile contexts is oftencomplicated by unclear or overlapping mandates within and between line ministries. Theestablishment of roads funds for O&M and other specialized regulatory agencies are a good idea

but can become beholden to political and institutional rivalries. De facto decentralization can alsolead to confusion over regulatory mandates and oversight and can delay important decisions aboutdifferent regulatory models (federal/central etc). In addition, sound regulation requiresfunctioning legislative capacity for the regulation, management and maintenance of keyinfrastructure such as water and power.

12. Within the broad area of public sector capacity, public procurement capacity is one of themost common bottlenecks in infrastructure programs. Weak procurement capacity can lead todelays and corruption. Ideally the public sector manages the tender processes itself, but when statecapacity is especially weak and the involvement of high-level political officials in procurement iswidespread, a foreign company can be retained to administer the entire procurement process from

project identification to design, tendering, and contract management. The major concern with thisapproach is to integrate capacity-building in the medium term to ensure the state is not bypassedor undermined.

13. The RDP set out a comprehensive plan for Somalias public se ctor and institutionalcapacity-building for infrastructure. Even at that time, the authorities in Somaliland and Puntlandhad been able to put in place some basic legislation and institutions to manage infrastructure: forexample the Somaliland Roads Authority and the Puntland Highway Authority which both

provide a basis to build on. Despite this start, further strengthening of the legal framework andinstitutional capacity will be critical. In Somalia, the powerful and politically-integrated businesscommunity presents both an opportunity and a risk. For significant investments in infrastructure

in all regions in Somalia, a procurement agent and a financial management agent located withininstitutional structures would make sense.


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Private sector depth and capacity

14. The presence of a local contracting industry with some capacity and depth able to participate in tenders and to deliver on contracts is a key condition for success. In most post-conflict environments, the lack of investment, a brain-drain effect and poor standards/investmentin higher/vocational education leads to a dearth of local firms with the capacity to win big

contracts. New firms face an unattractive enabling environment and very weak or absent financialmarkets. This situation typically creates a vicious circle in which international firms win tendersand local firms remain sub-contractors unless donors and the authorities proactively manage

procurement criteria. On the other hand, if well handled, a public investment program ininfrastructure can trigger an increase in the supply and capacity of local private contractors, and inturn can generate employment.

15. Somalia has a strong business community with good access to funding from the diaspora.In fact, unlike in many fragile contexts where the business community is marginalized and lackscapacity, in Somalia, the business community is powerful and has continued to pursueinvestments. Prolonged peace in Somaliland has encouraged the return and establishment ofsignificant business interests in Hargeisa and other urban centers, focusing mostly on the delivery

of services such as power, telecommunications, domestic water supply and urban waste disposal.The links between business and politics is particularly strong: the political economy of procurement is complex and outside actors may need to make extra efforts to ensure a level andtransparent playing field, including carrying out some political analysis.

16. The policy and regulatory framework around contracting will need to be developed. Theaim would be to build and establish the culture of transparency and accountability, as well as theguidelines, procedures and arrangements for monitoring. Utilizing local contractors for small tomedium repair works will prove invaluable for the future development of a sound civil works-contracting base in Somalia. Furthermore, it will ensure that the benefits of investments in roadinfrastructure will be as widely distributed as possible from a regional point of view.

Infrastructure financing, timelines and programs

17. Project cycles for infrastructure development are longer than in other sectors and, inuncertain and insecure contexts, contract modifications and project restructurings are often part-and-parcel of implementation. Moreover, infrastructure investments require large up-front

payments and have a lumpy spend profile overall. The short-term and flexible aid frameworks andstrategies that most donors use to guide their engagements in contexts like Somalia do not makefor appropriate frameworks for infrastructure financing. This is certainly the case in Somaliawhere most donors focus on short-term quick impact or emergency recovery/humanitarian work.Donors will need to think imaginatively in order to create a more attractive environment for largeinfrastructure projects, starting with longer timeframes.

18. Trust fund arrangements can help, by allowing for multi-year budgeting, planning andexpenditure, and for longer project cycles. Pooling funds means they can reach a scale necessaryfor bulky contracts requiring large disbursements upfront. In addition, donors and counterparts dowell to consider projects or investments within a broader sector-wide strategy where possible.Guarantee facilities are also an important component of securing investments in fragile contexts.

19. Finally, budgeting for O&M is often forgotten during infrastructure planning work,especially in fragile and conflict affected countries where the priorities are to get visible workstarted on rehabilitation/reconstruction, where projects are poorly coordinated with governmentsand where fiscal space is tight. O&M for investments constructed directly by donor-financed

projects fall outside of the governments budget purview, meaning no allocations are made fortheir upkeep and investments are not sustained. Coordinated and pooled programming with fundsallocated towards upkeep offer one way of avoiding this pitfall.


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Part 2:Assessment of Somalias infrastructure and needs

20. This section of the note presents an assessment of the condition of Somaliasinfrastructure (based on field work completed in 2006), priority needs for reconstruction anddevelopment, and the practical requirements for achieving these improvements. Basicinfrastructure particularly in the water, transport, and energy sectors which are the focus of thisnote would support the productive sectors in restoring economic growth, the social sectors inimproving well-being and livelihoods, and communities in building peace and achievingreconciliation.

21. As noted in Part 1, prospects for infrastructure rehabilitation and development dependenormously on maintaining a peaceful political environment, law and order, sound economic andsocial policies, and the proper functioning of the facilities and services later.

22. The 2006 assessment of the state of infrastructure in Somalia found that all infrastructurefacilities had suffered from lack of maintenance and rehabilitation, war damage and vandalism,and years of neglect. As there are limited inventories and condition records, it remains a priorityto get more comprehensive data on the true state of the infrastructure, its institutional functions, aswell as needs, design and costs together with its implementation modalities.

23. While the civil war has had a devastating effect on infrastructure in all regions,Somaliland and Puntland by 2006 had made some recovery as a result of their relative peace andstability, including in putting in place legislation and institutions to manage some of theirinfrastructure. In particular, the transport sector institutions benefited from support under theSub-Saharan Africa Transport Program (SSATP) and donor-financed projects. That said, bothregions were still seeking to establish full institutional capacities for planning, implementing andmaintaining a viable infrastructure reconstruction and development program.

24. In assessing needs and recommending a way forward, private sector involvement ininfrastructure offers some opportunities, though elements of government control, regulation andenforcement must also be present. To date, the private sector has been involved in managingvarious infrastructure facilities such as roads, airports/airstrips, urban infrastructure (includingwater supply and sanitation), power generation and supply, and in providing infrastructureservices such as road and air transport, shipping, fishing, power and water distribution and

provision of sanitation services in towns.

25. One critical issue of concern to infrastructure works relates to landmines. Most road,airport, port and major power rehabilitation work will require initial mine-clearing operations. Inthis context, it will also be essential to establish, in consultation with the various localstakeholders, the location of landmines and unexploded ordinances (Axis), and develop a clearstrategy and plan for minimizing the potential dangers posed by them. Actions in this regard willrequire collaboration of organizations such as the Halo Trust and DDG, present in the region.

Key Reconstruction and Development Objectives

26. Short-term (two years). Short-term infrastructure reconstruction and development priority actions would aim to address the most urgent needs of Somalia. Proposals would includeinitiating the reconstruction of essential infrastructure, including major trunk roads (US$47,000

per km) and bridges, major power generating and distribution systems, and major urban watersupply (US$1 million to rehabilitate/extend a system for city of 500,000 people and/or US$50,000to $100,000 per borehole) and sanitation. Efforts should be made to create employment throughlabor-based works using approaches such as community contracting where possible.

27. Medium-term (three to five years). Over the medium term, the objective would be to

build on the community-level interventions and consolidate gains, complete feasibility andengineering designs and contract documentation, and then to implement major infrastructure


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rehabilitation and reconstruction work, along with institutional development and capacity building. The following activities could be pursued:

Select projects for implementation based on technical and economic feasibility studies,regional equity, funding, security and peace-building impacts.

Complete feasibility studies, engineering designs, and procurement procedures, and planand implement de-mining activities for road and other large infrastructure investments; Start or continue implementation of works on major national and inter-regional roads andother infrastructure;

Complete studies to identify key regulations and institutional frameworks needed for the proper functioning of infrastructure and related services, and take action to ensureeffective enforcement of regulations;

Implement training and capacity-building for staff in public sector institutions identifiedfor training;

Identify and categorize capabilities of nationally-owned private consulting firms andcontracting companies and implement program of training and capacity building; and

Prepare and implement a long-term national strategy for development, maintenance and

financing of critical infrastructure.28. Leaving aside security, limited institutional and human capacity will be a major constraintto preparing and implementing infrastructure recovery and development plans. The ability toaddress capacity constraints depends in part on how firmly public sector institutionalarrangements and frameworks have been established, and how clearly the expected public sectorobjectives and institutional responsibilities have been laid out. In this connection, there are fourmajor areas of focus:

Extensive consultation with key stakeholders to define a viable institutional framework,setting out the public/private sector institutional objectives, functions, structures androles, as well as human resource needs;

For each of the proposed areas of investment, implementation of a built-in program of

capacity-building and training for persons involved and managed through a frameworkagreement with international agencies or consulting firms;

Recruitment and mobilization of interested qualified and experienced Somali expatriatesof appropriate professional and technical skills to help restore some of the institutionalcapacity to manage infrastructure development, train others and support management andimplementation of the program

Recruitment of private international consultants individuals and firms/NGOs asindependent technical assistance to carry out various assignments, or as in-line staff of

public institutions charged with responsibility for managing and implementing the programs.

Proposed Sub-Cluster Programs

29. In line with the broad objectives and principles set above, the 2006 report set outinfrastructure cluster interventions, as summarized in the attached Results Matrix, showingintended outcomes, baseline situation, constraints to achieving the outcomes by the end of the 5-year medium-term period now set for 2017, as well as the key actions and intermediate outcomes.In addition, the arrangements for monitoring the results are also attached to this report in separateMonitoring Matrix. The next section presents the status and context, institutional framework andexpected outcomes for each sub cluster, viz. Transport; Energy; and Water Supply and Sanitation.

TRANSPORTATION INFRASTRUCTURE

30. As of 2006, transport infrastructure in Somalia comprised about 22,000 km of roads, four

major ports, and fifteen major airfields (of which four had paved runways). There are no railways, pipelines or inland waterways, and there has been no major investment in developing or


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maintaining road infrastructure since the 1980s. The provision of transport services declinedsteadily due to limited investment, aging equipment and insecurity. Animal transport camelsand donkeys continue as the most important means of transport for many people. Withinsecurity and a poor road network, air transport has also played an important role. Despite acoastline of about 3,300 km, coastal shipping has had limited development, particularly as piracyhas increased, although it has much potential.

(A) Roads and Bridges

31. By 1990, Somalias road network totaled about 21,8 30 km, classified as primary (2,559km), secondary (4,850 km) and rural/feeder roads (14,421 km). The primary road network,which was largely paved, served population centers like Kismayo, Mogadishu, Hargeisa, Berbera,Garowe and Bosasso. The secondary road network connects settlements of local significance toone another and to the primary road network, and is predominantly earth roads or tracks.Rural/feeder roads are mostly low-traffic earth roads, which serve as access to the primary andsecondary road systems; no reliable inventory exists covering these roads. The extent of the roadnetwork in 1990 was barely adequate to meet the transport needs of the economy. Some of the

more productive regions did not have all-weather roads crossing them, and this hindered theaccess to markets for farmers products in Middle Juba from Jilib, over Buaale to Saakow andcontinuously along the Juba River to Bardhere in Gedo region.

32. Over the last 20 years, the condition and quality of the road network has deterioratedsharply due to a lack of investment and maintenance. Today, less than 600 km of roads are still

paved and in a good condition. In general, paved roads that where constructed on the predominantly good, well-drained soils of south-central Somalia have remained in decentcondition, whereas roads in the valleys of the Shebelli and Juba rivers, where soil conditions aredifficult, are in poor condition. Historically, a paved two-lane road between Mogadishu andBerbera on the Gulf of Aden, via Belet Uen, Galkaio, Garowe and Burao (about 1,400 km),formed the north-south backbone of the road system. This road now extends 25 km south ofBorama in the Awdal region of Northern Somalia. The other most important roads are the coastalroad from Mogadishu to Kismayo (about 475 km) and the road from Mogadishu to Dolo, on theEthiopian border, via Afgoi and Baidoa (about 600 km), which also branches north-west toBardhere. In addition, the road from the northeastern coastal town of Bosasso connects the north-south road at Garowe, and was in relatively good condition (though it is now past the end of itsdesign life), while a paved two-lane road connects the port city of Berbera to Hargeisa andanother paved two-lane road connects Hargeisa to Dila (25 km south of Borama).

33. Until 1991, the Ministry of Public Works and Housing (MPWH), through its Directorateof Highways (formerly Civil Engineering Department), was responsible for planning, constructingand maintaining roads throughout Somalia. The Ministry of Land and Air Transport (MLAT) wasresponsible for vehicle registration and Ministry of National Planning (MNP) responsible forgeneral planning of the sector and for monitoring project implementation. By 1988, Governmentof Somalia (GoS) introduced major innovations in the management of road maintenance. Notably:(a) an autonomous self-budgeting Directorate of Highways (DoH) was established under MPWH;and (b) DoH gained direct control over all road maintenance activities in seven newly-definedHighway Maintenance Areas throughout the country 1, and they retained the services of severaltrained Somali engineers who formed the backbone of the technical capacity of the Directorate.MPWH also established a Road Maintenance Fund (RMF), which generated revenues through afuel tax. Somaliland and Puntland, with support from the European Union (EU), by 2006 hadadopted the institutional models promoted under the RMI of the SSATP.

34. At present, the TFG has a Ministry of Transport (MoT) with very limited capacity. Theinstitutional and legal framework under which it functions is not fully defined and so the TFGshould consider membership, representation and support from the SSATP in defining its

1 Areas 6-7 now correspond roughly to the regions of Somaliland and Puntland.


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institutional and legal framework for the transport sector. In the case of Somaliland, manygovernment institutions and private sector organizations have been the beneficiaries ofrestructuring and capacity building support by international donor organizations. The EU helpedto establish the Somaliland Road Authority (SRA) and Road Fund Administration, though theSRA still lacks technical, institutional and financial capacity to manage Somalilands roadnetwork adequately. Puntland has established a Puntland Highway Authority (PHA), whosemain objective is to formulate and implement roadway and airport rehabilitation programs and tosecure transport sector funding from a fuel levy and from international and national stakeholdersdonations. The SRA and PHA have successfully implemented routine maintenance work on theirnetworks, but both need technical and financial assistance. South-central Somalia does not appearto have any fully functioning institutional arrangements in place to manage the road network. Theissue of how the road network is managed will need to be resolved before major investments canrealistically flow into the sector.

35. Lack of investment and progressive deterioration of the road network over the last 20years means that reconstruction and development needs are large. Taking into account the highcosts of rehabilitating/reconstructing road infrastructure, prioritizing and sequencing investmentsis essential. Rehabilitating and reconstructing a primary road (e.g., the road from Kismayo toMogadishu to Hargeisa) to paved surface standard costs US$1-2 million per kilometer, dependingon gradients, soil conditions, drainage needs, and the design solutions adopted. Regionalinterconnectivity is important for Somalia as a whole, and Somaliland in particular, where theBerbera Corridor road provides an important link between the Berbera Port and Ethiopia. Othermajor potential economic corridors include Borama to Djibouti, Bosasso-Garowe-Galkayo,Mogadishu-Baidoa- Dolow (on the Ethiopian border), and Bardhere-Jilib-Kismayo. Somalia willneed to explore links beyond Kismayo to northwestern Kenya as the program moves from theshort-term to medium-term implementation.

36. Beyond the priority list of needs and investments, technical and economic feasibilitystudies and extensive peace-building consultations will be required to quantify the prioritizedactions, and confirm economic trends and regional interconnectivity needs. Roads to be

rehabilitated will need to be under legitimate government control; roads under militia control willneed to be avoided, as they would otherwise provide revenue opportunities to the militia. Thisremains a significant impediment in south-central Somalia. In more stable Somaliland andPuntland, more could be done, including: (i) expanding the technical and managerial capabilitiesof the SRA and PHA; (ii) rehabilitating to a minimum all-weather standard small stretches of the

North South primary road; and (iii) constructing gravel feeder roads from coastal towns to inland population centers or to the primary and secondary road networks. Many potential projects in thenorth and northeastern regions have had feasibility studies that were financing-ready. Prioritiescould be taken from this list for the medium-term program, depending on the level fundingavailable, and above all an adequate capacity and a peaceful environment.

37. Shor t-term (two year) plans : In light of the low traffic volumes, long preparation times

(at least 18 months) required for survey and design, contract processing and award, and also thelack of capacity to implement major road works, the reconstruction and rehabilitation of majorroads during the first two years is not anticipated. Hence, the short-term focus should be to:

Develop institutional capacity in south-central Somalia as well as in SRA and PHA; and Undertake detailed technical and economic feasibility and engineering design studies of

major roads linking major productive centers such as key ports, urban areas, farmingcommunities, livestock hubs, and fishery processing centers, including intially:o Developing the Berbera corridor to provide Ethiopia with access to the port of

Berbera, starting with the unpaved 20 km Wajale- Kalabyadh section and then theKalabyadh-Hargeisa section, which requires widening and resurfacing toaccommodate truck traffic;

o Rehabilitating part of the 235 km Galkayo-to-Garowe portion of the North South primary road; and

o Preparing Phase II (engineering design) of Borama to Lowyado portion of the North-


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South primary road.

38. A significant portion of investments in the first two years will be required to developinstitutional capacity, with most capacity building efforts running concurrently with actual

physical improvements of the basic transport infrastructure. This will include developingguidelines for procurement, tendering and contract administration as a basis for implementing

works. For south-central and Puntland, an improved security, human rights, and law and orderrecord will be necessary, or else only very limited and localized road reconstruction anddevelopment works can be implemented. The short-term (two year) actions for developing theroad sector should also aim to create employment opportunities through labor-based works usingapproaches such as community contracting with food-for-work where required e.g., for buildingor opening up drainage structures.

39. M edium-term plan (f ive years) : This would seek to build on the community-levelinterventions, complete feasibility and engineering design studies and implement major roadrehabilitation and reconstruction work, along with institutional development and capacity

building. Project selection and prioritisation will need to take into account the strategic peace- building importance that infrastructure rehabilitation can have. Criteria can be developed through

wide consultation with relevant stakeholders and authorities. The priorities would include thereconstruction of and rehabilitation of important secondary roads. The following work could take place in the medium term reconstruction phase:

Select projects to be implemented based on technical and economic feasibility studies,regional and social equity and available funding, which could include:o Arterial urban roads, including in Mogadishu, when firmly under government control;o Sections of the North-South trunk road, including between Garowe and Bosasso;o Portions of the North-South trunk road between Mogadishu and Belet Uen (322 km),

starting with the section from Mogadishu to Jowhar (100 km); Establish the design standards, procurement guidelines and tender procedures that would

facilitate building on the lessons learned under the short-term program, and forimplementation as part of the medium-term program implementation;

Complete engineering designs, and contract award procedures for roads with thecompleted feasibility studies, along with plans for de-mining as required at criticalidentified locations of various infrastructure facilities;

Identify and categorize capabilities of nationally owned contracting companies; and Formulate and implement a strategy for development and maintenance of critical

infrastructure.

40. In light of the limited overall implementation capacity, both the short- and medium-termroad reconstruction and development programs will require the creation of a simple but effectiveimplementation framework. The Somaliland and Puntland road authorities can serve as a modelfor the management of the road infrastructure in south-central Somalia. A federal model couldalso be considered, if the situation allows: this would mean establishing a federal roads authority,which would be responsible mainly for national sector policy and for managing the primary roadnetwork, while regional road authorities are responsible for the secondary and feeder roadnetworks within their respective regions. The TFG, with assistance from its partners, and in closeconsultation with regional authorities, will need to address the issue of road infrastructuremanagement to enable proper implementation, coordination and monitoring of any roadreconstruction and development effort.

41. The implementation of the road infrastructure program will require an effective publicsector program management as well as capable and willing private sector enterprises and NGOs(domestic and international) to participate in the tenders and execute the works. All the tendering

processes must of necessity be undertaken according to strictly laid down procedures andguidelines. This would require that the existing tendering and operating guidelines be reviewedfor setting the basis for program implementation using private entrepreneurs. One of the importantaspects of tendering is everyones equal access to the possibility to compete, with the whole


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process taking into account equity, and ensuring transparency and non-discrimination. This wouldmean that all the tendering notifications would have to be announced in all the relevantregions/districts. The exact procedures need to be established during the short-term program toensure replication and extension during the medium-term.

42. ILO has developed Community Contracting and its Employment-intensive infrastructure

Program (EIIP) as approaches to addressing the poverty and unemployment existing in rural orunplanned urban settlements and has implemented small-scale pilot programs in Somalia using

both. Recruitment principles must minimize potential sources of conflicts by ensuring that variouscommunities and minorities including women and other disadvantaged tribal groupings wouldhave sufficient or equal opportunity for involvement and employment.

43. In parts of Somalia, especially Somaliland, contractors have been conducting roadmaintenance work for the SRA and have been able to build up some experience. Some of thecontracts performed by these companies include bituminous pavement patching and sealing, newculvert construction, and rehabilitating and repairing of existing bridges and culverts. Incollaboration with ongoing efforts, it will be beneficial to prepare a database of Somali engineersand technicians. This should lead to the establishment of a professional organization and facilitate

mentoring, training etc., with some overseas, regional engineers associations.44. The following are some indicative estimate costs for investments that have been compiledfrom past development partner feasibility studies:

Table 1: Upgrading road transportation in SomaliaOperation Cost US$ per kmUpgrading to bitumen standard (medium strength) from scratch,including earthworks and drainage 1,300,000Reconstruction of a paved road (medium strength) in poor condition

900,000Regravelling of an unpaved road with gravel within 7 km haulagedistance 46,800Construction of an unpaved road

85,000

(B) Air Transport/Civil Aviation

45. Somalia has four major airports in Mogadishu, Berbera, Hargeisa and Kismayo. Theairports in Mogadishu and Berbera, when operational, could accommodate major cargo and

passenger planes. Almost all other major urban centers in Somalia also now maintain at least oneairstrip capable of handling small aircraft. Since 1995, insecurity has closed Mogadishus maininternational airport, and it would now require major reconstruction before becoming operationalagain, but several unpaved privately-owned airstrips have opened around Mogadishu to

compensate. The overall number of airports/airstrips in Somalia is believed to exceed 60. Withstability in Somaliland, the authorities have carried out some infrastructure rehabilitation atHargeisa airport, including the construction of a departure terminal built with donor assistance.

46. Airport infrastructure is the most critical piece of infrastructure for trade with neighboringKenya and Ethiopia. Without adequate airport infrastructure, it would not be possible to expeditehigh-value economic commodities for export and supply around Somalia. This means that thesocio-economic consequences of potential high value commodities need consideration whenselecting, rehabilitating and reconstructing airport infrastructure.

47. The Civil Aviation Caretaker Authority for Somalia (CACAS) was formed in 1996 toensure the safety of air transport operations in the absence of a functioning government. CACASis jointly managed by UNDP and ICAO. It operates from a facility in Nairobi, Kenya, and field

stations in Somalia. The main objectives of CACAS are to: (i) to provide the safe operation andmaintenance of essential facilities, equipment and services for all air transport operations in


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Somalia; and (ii) to assist in the rehabilitation and development of aviation (airport and airnavigation) infrastructure in Somalia.

48. Somaliland maintains its own civil aviation ministry responsible for the management ofday-to-day operations of Hargeisa and other regional airports. Hargeisa airport may now be the

busiest in the country (it had 1,750 landings, 5,600 passengers and 2,300 tons of cargo in 2002),

and it has regular international flights to Kenya, Ethiopia and Dubai. Other major airports inSomaliland include Berbera (with a 4,140 meter paved runway that is by far the longest runway inSomalia) which can accommodate any wide-body plane, but, despite its good condition, it ishardly used as it is not convenient to any major population.

49. The high economic value of airports has made them a major source of conflict in Somalia,as warlords through their control of airports can extort large amounts of revenue through landingfees and import taxes, including on khat. The secure opening of any major airport to internationaltraffic will therefore depend on a comprehensive political settlement between the various factionscompeting over its control. The owners of Mogadishus three private secondary airports have anobvious interest in keeping Mogadishu airport closed and would need to be consulted and perhapscompensated if the main airport were to be reopened. Moreover, the capabilities of local

contractors to undertake airport rehabilitation work are yet to be tested. Developing the technicaland managerial capacities of local contractors is essential to allow the preliminary rehabilitationworks to start on some of the airport infrastructure. Overall, a priority actions will be the need toconfirm the inventory of existing airports, their number, condition and needs, as data are poor.

50. Implementing any improvements to airport and air navigation infrastructure will require policy coordination and support. This should build on the strengths of the working institutionalarrangements in Somaliland and Puntland. In addition, CACAS could play an importantcoordination and management role in continuing to assist Somalias needs to meet therequirements for international passenger and air cargo services with neighboring countries and theoutside world. All interventions regarding air transport in general would need to be made underthe overall oversight, management and policy framework of the ICAO.

51. Shor t- and medium-term plans : In light of the low traffic volumes, long preparationtimes (at least 18 months) required for survey and design, contract processing and award, and alsothe lack of capacity to implement airport reconstruction, the short-term focus should be torehabilitate basic airport infrastructure at Hargeisa, Garowe, Mogadishu and Kismayo. As in thecase of road works, a significant portion of investments in the first two years will be required todevelop institutional capacity, with most capacity building efforts running concurrently withactual physical improvements of the basic transport infrastructure. In the medium-term workwould seek to complete feasibility and engineering design studies and implement major roadrehabilitation and reconstruction, along with institutional development and capacity building.Among the activities to be completed could be resurfacing the Hargeisa runway and rehabilitatingother airports.

(C) Ports and Shipping

52. Somalia has over 3,000 km of coastline, but only four major ports, at Mogadishu,Kismayo, Berbera and Bosasso. Two others, Merca and Las Qorey, are essentially jetties. Each ofthe major ports is a deepwater facility. In 1988, Mogadishu was the largest and handled about817,000 tons of cargo, representing 73% of export/import traffic, while Berbera handled 20% (ofwhich 94% was livestock export) and Kismayo 4% (of which 75% was export of bananas).Mogasdishu and Kismayo have ceased regular operations for the last 20 years. Most of the cargofor Mogadishu and environs has now shifted to a privately-owned natural small deep-water port inEl maan , north of Mogadishu. The relative security in the north has made the ports of Berberaand Bosasso the main focus of maritime activity in Somalia, with Berbera port (which wasrehabilitated and modernized with EU assistance) potentially serving as an alternative port for theEthiopian hinterland.


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53. The development of coastal shipping has been limited mainly because there has been littleinter-regional trade suitable for such shipping. Individual operators with small boats of up to 300dwt carry some passenger and freight traffic along the northern coast between Seyla and Bereda.The development of commercial fishing could stimulate coastal shipping, though increased piracyalong the Gulf coast has seriously disrupted commercial shipping.

54. In 1989, the Ministry of Fisheries and Marine Transport (MFMT) through the Somali PortAuthority (SPA), was responsible for port operations, and, through the Somali Shipping Agencyand Line (SSAL), was responsible for marine transport. Until 1990, the ports were managed bythe Somali Ports Authority (SPA). Berbera Port Authority now manages the Berbera port andrequires institutional strengthening. Diverting some of Ethiopia s imports from other regional

ports to Berbera will have a tremendous economic benefit for Somaliland and Ethiopia and in thelong term will contribute to regional stability and dialogue. Estimates are that Berbera at presentcould handle up to 300,000 mt of cargo per year. To this end, the Berbera Corridor Board wasestablished in 2005 to develop, manage and coordinate activities related to the use of the BerberaPort by the Ethiopian business community. The Port is also a viable transit hub for responding tohumanitarian needs throughout the Horn of Africa. The location of the port along the Red Sea, its

proximity to Ethiopia and the fact there is an all weather road network from Berbera to Ethiopia,makes it possible for cross-border transit activities to increase dramatically in a few years.55. Implementing any improvements to the ports sub-sector along with the development ofcoastal shipping requires policy coordination and support from TFGs ministerial setup, under aMinistry of Transport, or the equivalent of the Ministry of Fisheries and Marine Transport(MFMT) that previously existed. These arrangements should build on the strengths of the working

ports authorities in Somaliland and Puntland. In addition, all international issues relating to portsoperations and shipping need addressing within the framework of the International MaritimeOrganization (IMO).

56. Shor t- and medium-term plans : In the short term, investments in improving Berberasoperations equipment (e.g., by acquiring a mobile crane) and training its personnel could reapstrong returns; in the medium term, action will be required to dredge the navigation channel,which is increasingly affected by wind-blown siltation. The rehabilitation of the ports ofMogadishu and Kismayo would be possible only once those facilities were firmly in the hands ofa legitimate government.

ENERGY GENERATION, TRANSMISSION AND DISTRIBUTION

57. Modern energy accounts for about 2% of the total energy use in Somalia, and is usedmainly for the residential, commercial and industrial sectors, as well as to run most borehole

pumps. Somalia primarily uses charcoal and firewood as the main source of domestic energy:87% of the countrys energy consumption is estimated to be biomass fuel and 11% petroleum

products (excluding diesel fuel used to generate electricity). Most electricity in urban and rural

areas is derived from diesel generators owned and run by private enterprises or NGOs. For some private generators, the primary objective is to supply their own premises (telephone companies,hotels, small industry, etc.) and the spare capacity is sold over a very rudimentary isolatednetwork to supply consumers in the immediate locality.

58. Other potential sources of energy in Somalia are solar, wind, coal and hydroelectricity.These are mostly untapped. In Siad Barres time, a major hydroelectric scheme at Bardhere was

planned, but its construction came to a halt in 1989, in part due to serious environmental concerns(since it would put tracts of land under water and possibly change the fragile balance of theecosystem around the Juba River).

59. The TFG, Somaliland and Puntland have energy directorates or authorities. They form thefocal point for data collection and policy setting and need empowerment to implement the

policies. Government electricity supply agencies or authorities operate in regional centers ofSomaliland and Puntland. These agencies operate existing publicly-owned power plants and/or


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distribution networks. Puntland Electric Energy Authority, which owns the Bosasso, Ghardo andGarowe power stations, around 2005-6 signed a private enterprise to manage the power stationsand distribution network. It is not know whether the terms of the agreement were finalized andimplemented. While private companies can provide electricity at the local level, there is no legalframework, and even the authority of the local government agencies is weak to enforce basicstandards or safety criteria. When connecting customers to private generators, private connectionis provided without any legal basis for quality, reliability and safety; the private operators collectrevenue from their customers and a percentage is paid to the authorities as a concession and foruse of the streets to install overhead lines.

60. The energy portfolio covers several ministries, both at the TFG level and the regionalgovernment levels. A federal National Energy Authority should be given the overall responsibilityfor managing the short-term and medium-term reconstruction and development program.Implementation will be best achieved if the responsibility is devolved at the regional level.

61. Electricity generation : It is difficult to estimate the total installed generation capacity because of the existence of private unregistered generation. Somaliland is believed to have about5,750 kW of installed generation owned by the Somaliland Electricity Agency; Puntland about

910 kW owned by the Nugal Electricity Cooperative (in Garowe) and 2,100 kW owned bySomaliTech (in Bosasso and Gardho). Installed capacity in south-central Somalia is unknown. In1988, the GoS reported that the total installed capacity in Somalia was 55,300 kW, of which38,000 kW (69%) was in Mogadishu. In any case, actual output is certainly well below installedcapacity. Most of the generators that existed in the early 1990s have been either looted, damagedor had parts removed to replace in other machines, or are otherwise out-of-service due to lack of

parts. Some generators have been replaced with second-hand generators by the local authorities.

62. Electricity transmission and distribution : There is no electrical grid in Somalia (a gridconnects major load centers to more than one power source). Some 15kV transmission lines existin major regional centers, transmitting power from a single power station to the load areas withstep-down transformers 15kV/380V. Most of the distribution is over low voltage (380/220 volts)lines from a single generator source to the load area, with no interconnection of various generatorsources. Thus, generators form a radial rather than an interconnected system, and they have lowreliability, are costly, and are mostly under-utilized at the time of low loads and cannot share theloads at peak times. A large pool of generators could form a power station, which could beinterconnected through a grid to other power stations, but to run a generator in parallel with othergenerators on the network, a synchronization facility is required on each generator. Running manygenerators in parallel requires a system stability study.

63. The 380V distribution networks are very rudimentary. Most of the distribution lines are built by stringing single core or twin PVC insulated cables on very thin poles that also carrycommunication wires. Generally, the distribution network is unsafe and underrated to provide aquality of supply. Consumers are connected by running a suitable/available wire from the point ofattachment on the premises to the nearest pole in the street. In some instances, the connection ismade to the neighbors point of attachment if a power pole is not in the vicinity. The consumerinstallation is frequently not tested and mostly does not have adequate earthling safety feature.Consumer connections made to the grid run by the government agency are more likely to beformally connected and recorded.

64. Shor t-term plans: Expanded electricity supply can be achieved relatively quickly, andwould have a strong economic multiplier effect, acting as an immediate catalyst for commercialand industrial development and also improving the standard of living of a large part of the

population relatively quickly. Work should focus on: Improving the electricity transmission and distribution network by planning a network

and using the right cabling to reduce losses, add revenue to suppliers, and improve qualityof supply;

Expanding generation capacity by improving the state of the existing large power stationsand interlinking and synchronizing existing generators in key regional centers and by


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studying the potential of re-commissioning the Fenola hydropower scheme (possiblyunder a lease agreement with a private company); and

Expanding the numbers and skill levels of energy sector personnel, to cater for theexpanded network and proper operation and maintenance of the system, including:o Engaging a planning team to develop area and regional plans for electricity

infrastructure;o Establishing an independent installation inspectorate to ensure the quality and safety

of energy generation, transmission, distribution and customer installation;o Establishing a regulatory body to oversee commercial arrangements, public tariffs

and easement issues ( inter alia ).

65. The following are some indicative estimate costs for investments that have been compiledfrom past development partner feasibility studies:

Table 2: Short-term (1-2 year) interventions in the energy sector in SomaliaDevelopment of transmission and distribution network

(locations: Mogadishu, Benadir; Kismayo, Lower Jubba; Garowe, Nugaal; Bosasso, Bari; Hargeisa, Woqooyi,Galbeed; Barbera; Galkaio, Mudug; Jowhar, Middle Shabelle; Baidoa, Bay; Beletweyne, Hiraan)

Units Unit cost ($/unit) Total cost ($m)15kV Line (km) 234 16,500 3.9380/220 Line (km) 704 6,000 4.215kV/380V Transformers(units) 234 4,000 0.9Total cost 9.0

Development of power stations (locations: Mogadishu, Benadir; Kismayo, Lower Jubba; Garowe, Nugaal; Bosasso, Bari; Hargeisa, Woqooyi, Galbeed;

Barbera; Galkaio, Mudug; Jowhar, Middle Shabelle; Baidoa, Bay; Beletweyne, Hiraan)Units Unit cost ($m/unit) Total cost ($m)

Generation units (MW) 70 1.5 105.0

Other priority interventionsTraining and skills development 7.0Establishment of a planning team 2.5Establishment of a regulatory body for public-private partnership 1.0Establishment of Electrical Installation Inspectorate 1.0Short-term priority interventions total cost 125.5

66. M edium-term plans : In the short-term the planning team should initiate studies onfurther improving network capacity and rationalizing electricity generation. This will require the

preparation of detailed technical and preliminary engineering studies to prioritize investments inelectricity generation and distribution. Inter-regional grids would be more economical in thesouthern parts of the country as the population density is higher in the area (in the north,

population density is only 8 per sq. km while in the south it is 20). Three projects that could startin the medium term, after verification by the system study are:

Interconnection of Jilib, Jamama, Kismayo and Fenola; Re-commissioning of the power plant in Fenola; and Initiation of studies of the possibility of developing the Bardhere Hydroelectric Scheme.

67. Future investments should carefully assess the inclusion of other possible sources ofenergy such as wind and solar. All renewable sources of energy have good potential in Somalia.This will require an in-depth study of their viability and costs. Thus, the recommendation is forinitiating technical studies immediately to enable these sources to be exploited in the mediumterm. The applications of solar energy include heating water with rooftop and electric power

where grid energy is not. For wind, existing out-of-service wind turbines on the east coast could be rehabilitated, and wind pumps could prove to be the right energy source for borehole pumps in


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rural areas. Under an improved security situation, the assessment of Somalia s oil and gas- producing potential should also be undertaken.

68. The following are some indicative estimate costs for investments that have been compiledfrom past development partner feasibility studies:

Table 3: Medium-term (3.5 year) interventions in the energy sector in SomaliaDevelopment of transmission and distribution network

(locations as above)Units Unit cost ($/unit) Total cost ($m)

15kV Line (km) 115 16,500 1.9380/220 Line (km) 350 6,000 2.115kV/380V Transformers(units) 115 4,000 0.5Total cost 4.5

Development of power stations (locations as above)

Units Unit cost ($m/unit) Total cost ($m)

Generation units (MW) 50 1.5 75.0Other priority interventionsInterconnection of Mogadishu, Jowhar and Fenola 16.5Rural electrification 15.5Re-commissioning of Fenola power plant 3.0Commencement of the Bardhere Hydroelectric Scheme 4.5Realignment of regulatory body 1.5Short-term priority interventions total cost 120.0

WATER SUPPLY

69.

Clean water is a critical resources in all urban areas in Somaliland, Puntland and south-central Somalia, especially for the vulnerable groups (IDPs, urban poor, women-headedhouseholds, etc.). As of 2006, it was estimated that less than 30% of the total population inSomalia has access to a clean, sustainable water source, and even fewer has access to basicsanitation facilities. Most people in Somalia obtain water from natural resources such as

boreholes and shallow wells, and the latter are often located within settlements, leading to poorquality of the water (due to pollution from surrounding latrines) and frequent outbreaks of water-related diseases such as cholera and diarrhea. Most urban water infrastructure is in urgent need ofrehabilitation, as it is either damaged or has been poorly maintained. Only in Somaliland andPuntland have basic investments been made to improve water supply, mainly by the internationalcommunity.

70. Prior to 1991, urban water supply in Somalia was managed by the public sector, but even before then, the water sector was facing financial difficulties and water supply systems in manycities were inadequate. For example, Mogadishu relied on German and Chinese Governmentassistance to maintain the water supply system. Since then, facing a mounting water supply crisis,

both Somaliland and Puntland have attempted to re-organize the urban water sector and haveestablished water agencies to manage water sector development. This has enabled the flow ofsome investments into basic water infrastructure expansion. Nonetheless, responsibilities betweenvarious water authorities in Somaliland and Puntland remain unclear and their power to enforcedecisions and control activities is often non-existent. In south-central Somalia, there are no well-defined local or central government institutional structures to develop and maintain water supplysystems. Private companies have developed functional services in some cities in the region.

71. The current water supply situation in Somaliland is inadequate due to a variety of factorsincluding an arid climate. As of 2006, it was estimated that 45% of the urban population is served

by either piped water or water kiosks/trucks, while 45% of rural people use water catchments; and


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that the water requirement of Hargeisa city was then between 12,000-20,000m 3 per day(depending on the source of the information), while the output capacity was only 6,000-8,000m 3.At the time, four companies were treating public water supplied through piped connection andare selling and even exporting it as mineral water. In Hargeisa, the water charge was $1.20/m 3 for

private customers with piped connection; $4/m 3 for donkey cart deliverers and $10/m 3 for waterkiosks and trucks. Responsibility for urban water supply as shared between various ministriesand agencies, with the president of Somaliland appointing the general managers of Hargeisa,Berbera and Burao. At the time, all major cities in Somaliland had their own water authorities,which were semi-autonomous and self-accounting. A National Water Policy for Somaliland had

been approved by the Council of Ministers in 2003 and a Water Act and Regulation werecompleted in 2005. There was also some good PPP practices in urban water infrastructure,

particularly in Boroma, which provided a model that could be applied to other cities inSomaliland and beyond.

72. Like Somaliland, Puntland suffers from major water shortages. Safe drinking watershortage is a recurring problem throughout Puntland. For example, in Bosasso 60% of the

population gets water from approximately 500 shallow wells within the urban area withquestionable water quality, and only about 40 % is served by the water supply network (as of2006). Basic water sector institutions, division of responsibilities and regulations exist inPuntland. The main body is the Puntland State Agency for Water, Energy and Natural Resources(PSAWEN). Ministries and the private sector are also involved in the urban water supply.

73. In light of the continuing strife in large parts of south-central Somalia, there has been verylittle investment in rehabilitating and developing water supply infrastructure, although theinternational community carried out projects to rehabilitate or develop fundamental urban watersupply infrastructures (drilling of boreholes, mini water supply systems) in relatively safe urbanareas. The absence of a functioning central and local government structures further complicatedthe investment in the water sector management. The private sector plays a significant role in theurban water supply. At the central government level, the TFG has established a Ministry of Waterand Natural Resources, but no agencies or urban water legislations appear to exist. That said,

good PPP practices exist in some urban areas, e.g., the Farjanno water company in Jowhar.74. The provision of water supply in Mogadishu in 2006 was dominated by default by the

private sector. At the time, about 400-500 private water supply companies operated in and aroundMogadishu without central or municipal government regulation. Water quality varied betweenvendors from good to unacceptable/toxic. Existing private sector structures in the water supply inMogadishu give a basis for the system expansion based on best local practices, while theemerging municipal water institutions should focus on the development of regulatory and

planning frameworks for the capital region.

75. Shor t-and medium-term plans : In the short term, these would include: completing ageo-hydrological survey of water in Somaliland and Puntland; investing in additional urban waterinfrastructure (boreholes and pipelines) in cities with good municipal water sector management(Hargeisa, Boroma, Burao, Erigavo, Bosasso, Gardho, Galkayo); establishing a multisectoralwater and sanitation committee for each regional capital to coordinate the water sector regulatoryframework and water service development, and build committee capacities; supporting thecreation of public-private partnerships and private utilities for municipal water supply; anddeveloping a national water policy (and further develop and enforce the Somaliland Water Policy)and municipal revenue collection policy, clarifying the role of the TFG. In the medium term, therehabilitation and extension of urban water supply could be significantly scaled up.

76. Investments in the urban water sector will face numerous challenges ranging from a lackof capacity in parts of the country, and overall funding constraints. Furthermore, the strong

presence of the private sector in the provision of water supply will require careful management toavoid exacerbating local tensions. To this end, the various public and private parties currently

involved in water supply should retain ownership in the development projects and theirmanagement during implementation to ensure local capacity development within a clearly


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defined regulatory framework. In addition, rehabilitation projects in Somaliland and Puntlandshould take place under existing ministerial and public agency oversight. In the medium term, theTFG can lay the foundation for water sector institutions and prepare legislations at the federallevel. Technical implementation of all the urban water development projects should beundertaken by international organizations with experience and knowledge of the current watersituation in Somalia.

Documents

World Bank Infrastructure Note