Facility Administration Manual

Project Number: 43439 Loan Number: {LXXXX} September 2010

Republic of Kazakhstan: Multitranche Financing Facility for the Central Asia Regional Economic Cooperation Corridor 2 (Mangystau Oblast Sections) Investment Program

Facility Administration Manual

DRAFT (as of 7 Sep 2010)

Contents ABBREVIATIONS I. PROGRAM DESCRIPTION 1

A. Program's Background, Rationale, and Location 1 B. Impact and Outcome 3 C. Outputs 3

II. IMPLEMENTATION PLANS 4 A. Project Readiness Activities 4 B. Overall Project Implementation Plan 4

III. PROGRAM MANAGEMENT ARRANGEMENTS 4 A. Program Stakeholders—Roles and Responsibilities 4 B. Key Persons Involved in Implementation 6 C. Project Organization Structure 7

IV. COSTS AND FINANCING 9 A. Detailed Cost Estimates and Financing Plan 9 B. Fund Flow Diagram 9

V. FINANCIAL MANAGEMENT 10 A. Financial Management Assessment 10 B. Disbursement 10 C. Accounting 12 D. Auditing 12

VI. PROCUREMENT AND CONSULTING SERVICES 12 A. Advance Contracting 12 B. Procurement of Works, and Consulting Services 12 C. Procurement Plan 13 D. Consultants’ Terms of Reference 15

VII. SAFEGUARDS 15 A. Environment 15 B. Land Acquisition and Resettlement 16 C. Indigenous People (IP) 17 D. Labor, Gender, Health, and Social Protection 17 E. Execution of Contracts for Works 17

VIII. PERFORMANCE MONITORING, EVALUATION, REPORTING AND COMMUNICATION 18 A. Design and Monitoring Framework for the Investment Program 18 B. Project Monitoring 20 C. Reviews 20 D. Reporting 20 E. Stakeholder Communication Strategy 21

IX. ANTICORRUPTION POLICY 22 X. ACCOUNTABILITY MECHANISM 23 XI. RECORD OF FAM CHANGES 24

ATTACHMENTS

1. Program Master Schedule 2. Terms of Reference for Required Consultants and Auditors 3. Environment Management Plan 4. Land Acquisition and Resettlement Monitoring and Evaluation Indicators 5. Progress Report Templates

Facility Administration Manual Purpose and Process The facility administration manual (FAM) describes the essential administrative and management requirements to implement the project on time, within budget, and in accordance with Government and Asian Development Bank (ADB) policies and procedures. The FAM should include references to all available templates and instructions either through linkages to relevant URLs or directly incorporated in the FAM. The Ministry of Transport and Communications (MOTC), and the Committee of Roads (COR) are wholly responsible for the implementation of ADB financed projects, as agreed jointly between the borrower and ADB, and in accordance with Government and ADB’s policies and procedures. ADB staff is responsible to support implementation including compliance by MOTC and COR of their obligations and responsibilities for project implementation in accordance with ADB’s policies and procedures. At Loan Negotiations the borrower and ADB agreed to the FAM and ensure consistency with the framework financing facility, and loan agreements. Such agreement shall be reflected in the minutes of the Loan Negotiations. In the event of any discrepancy or contradiction between the FAM and the Loan Agreement, the provisions of the Loan Agreement shall prevail. After ADB Board approval of the project's report and recommendations of the President (RRP) changes in implementation arrangements are subject to agreement and approval pursuant to relevant Government and ADB administrative procedures (including the Project Administration Instructions) and upon such approval they will be subsequently incorporated in the FAM.

ABBREVIATIONS

ACN = advance contracting notice ADB = Asian Development Bank AP = affected people CAREC = Central Asia Regional Economic Cooperation COR = Committee of Roads CSC = construction supervision consultant CSP = consulting service package CTL = controller department CW = civil works DMF = design and monitoring framework DoR = Department of Road EARF = environment assessment and review framework EMP = environmental management plan FFA = framework financing agreement GDP = gross domestic product ICB = international competitive bidding IEE = initial environmental examination IFB = invitation for bids IPC = interim payment certificate IRI = international roughness index IP = indigenous people IR = involuntary resettlement KARM = Kazakhstan Resident Mission km = kilometer LA = loan agreement LAR = land acquisition and resettlement LARF = land acquisition and resettlement framework LARP = land acquisition and resettlement plan m = meter MFF multitranche financing facility MOF = Ministry of Finance MOTC = Ministry of Transport and Communications FAM = facility administration manual PMU = program management unit PMC = program management consultant PFR = periodic financing request PPMS = project performance monitoring system QCBS = quality- and cost-based selection RRP = report and recommendation of the President to the Board SPS = Safeguard Policy Statement TD = treasury department TOR = terms of reference TTFS Transport and Trade Facilitation Strategy vpd = vehicle per day WA = withdrawal application

I. PROGRAM DESCRIPTION

A. Program's Background, Rationale, and Location

1. CAREC’s Transport and Trade Facilitation Strategy (TTFS) and Action Plan1 develops six key corridors to increase the region’s connectivity and competitiveness. The strategy’s success largely depends on Kazakhstan’s investments in the corridors as Kazakhstan serves as the main conduit for regional trade owing to its strategic location and abundant resources. Kazakhstan consumes $12 billion of the Action Plan’s $25 billion investments for 2008–2017, to improve 3,600 kilometers (km) of roads, 1,700 km of railways, airport, and port in its territory.2

2. CAREC Corridor 2 connects the Caucasus and Mediterranean to East Asia via Central Asian countries.3 The investment program targets Kazakhstan's Mangystau Oblast (province) sections of the corridor. The adjoining road in Uzbekistan, which the Asian Development Bank (ADB) is helping improve,4 will add impetus to regional connectivity and strengthen the viability of the investment program roads.

3. Located at the center of transport flows between Europe and Asia, and thus providing strategic arteries of emerging transcontinental routes, Kazakhstan has great transit potential. Few land transport routes can avoid Kazakhstan when linking north to south or east to west. Trade between Asia and Europe, amounting to $700 billion in 2009, is expected to reach $1 trillion by 2015, of which 20% will pass through Kazakhstan. This transit traffic is forecasted to generate $1.1 billion in revenues for Kazakhstan.

4. Mangystau Oblast is Kazakhstan's major oil- and mineral-producing region on the eastern shore of the Caspian Sea. Aktau, Mangystau’s capital, is a regional hub for transporting the Caspian's bulky cargoes of oil and oil products to European and Asian countries, and for transit traffic connecting the surrounding oilfield developers to other countries. Aktau is an integral part of three international transport corridors—Transport Corridor Europe–Caucasus–Asia, North–South, and Inogate. Cargo transported across the Caspian Sea amounts to 30 million tons, of which 38% is via Aktau port. Consequently, investments have been poured in pipelines, shipping services, and Aktau port. As spillover traffic from the pipeline and the transport of goods increase, roads become indispensable.

5. Kazakhstan's 93,000 km road network has 23,495 km of republican (national) roads, and the rest are rural and urban roads. Increased motorization, a greater number of private road hauling companies, shorter transport hauls of goods, and a changing industrial and distribution pattern have increased road freight traffic. In 2009, roads accounted for 25% of Kazakhstan's freight traffic by ton-km and 85% of its passenger traffic by passenger-km. These shares are likely to continue to grow in the foreseeable future.

1 ADB. 2008. CAREC Transport and Trade Facilitation Strategy and Action Plan. Manila. 2 The action plan comprises 65 priority projects to construct or reconstruct 8,000 km of roads, 6,000 km of railways,

7 airports, 3 ports, and 7 logistics centers. 3 The corridor covers 3,800 km of roads, 3,900 km of railways, 3 airports, and 2 ports. It runs from Istanbul through

Poti and Batumi in Georgia to Tianjin and Shanghai in the People’s Republic of China (PRC), through Azerbaijan, Kazakhstan, Tajikistan, Uzbekistan, and the Kyrgyz Republic. The corridor includes rail and automotive ferry services across the Caspian Sea to Aktau and continues through Beineu, crossing into Uzbekistan at Karakalpakya. The route continues on to Bekabad, crosses into Tajikistan, and traverses back to Uzbekistan. It connects to the Kyrgyz Republic and then enters the PRC at Yierkeshitan, before proceeding to the PRC’s eastern port.

4 ADB. 2010. Report and Recommendation of the President to the Board of Directors: Proposed Multitranche Financing Facility to the Republic of Uzbekistan for the CAREC Corridor 2 Road Investment Program. Manila.

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6. Kazakhstan’s road sector has chronic operational and institutional bottlenecks caused mainly by (i) insufficient and deteriorating infrastructure, (ii) weak cost recovery, (iii) inefficient cross-border procedures, (iv) poor planning, and (v) limited project development and management capacity. These bottlenecks raise transport costs and hamper regional cooperation and integration opportunities, undercutting the country’s competitiveness.5

7. Much of the road network is in poor condition, as 40% of republican roads require major rehabilitation and proper maintenance. The feeder road network serving the rural population is not fully developed. Roads on the six main international corridors are mostly paved with asphalt, but their technical and operational characteristics (e.g., evenness and strength) are below international standards, with traffic exceeding allowable loads.6 As a result, the average driving speed along the Transport Corridor Europe–Caucasus–Asia, one of the six international transit corridors, is less than 20 km per hour. Combined with cross-border impediments, deteriorated road infrastructure has led the country’s transit traffic to fall far short.

8. More than half of the road surface in Mangystau Oblast is gravel or earth, and most of the paved sections are severely deteriorated and impassable. Traffic on the Akau–Beineu road has grown by 7% annually. Despite its strategic role as an arterial route, most of the road is in bad shape, as steep slopes and sharp turns limit the allowable speed. Congestion occurs daily, and the actual axle load of vehicles exceeds the road's design capacity. The road's inadequate serviceability and the consequent 12-hour travel time between Aktau and Beineu bloat transport costs and restrict trade.

9. The investment program will reconstruct the 790 km of CAREC Corridor 2 roads in Mangystau Oblast. The investment program roads connect Kazakhstan to Azerbaijan, and Europe through the Caspian Sea to the west; to the Russian Federation to the north; to Uzbekistan to the southeast; and to Turkmenistan to the south. The investment program effectively responds to bottlenecks and risks, which were assessed in the road map.

10. The government has adopted the 2020 Strategy for Economic Development (approved in February 2010) and the State Program on Accelerated Industrial-Innovative Development (SPAID) (approved in March 2010) to diversify the economy and promote all sectors’ balanced developments.7 To effectively support the 2020 Strategy and SPAID, the government’s previous road development plan for 2006–2012 (RDP) has been reshaped and expanded into the Transport Sector Program for 2010–2014 (TSP), approved by the government in July 2010. The TSP will develop an efficient transport system, which is integrated into the international transport system.8

11. An MFF is proposed to finance the investment program. The MFF comprises physical investments for upgrading roads and border infrastructure and facilities, as well as nonphysical investments for institutional capacity development, which includes project preparation, project

5 Sector Assessment (Summary): Road Map (Appendix 2). 6 The six main international routes are (i) Tashkent–Shymkent–Taraz–Almaty–Khorgos, (ii) Shymkent–Kyzyl-Orda–

Aktobe–Uralsk–Samara, (iii) Almaty–Karagandy–Astana–Petropavlovsk, (iv) Astrakhan–Atyrau–Aktau–border of Turkmenistan, (v) Omsk–Pavlodar–Semei–Maikapshagai, and (vi) Astana–Kostanai–Chelyabinsk–Ekaterinburg. Routes (i) and (ii) are part of CAREC Corridor 1 and route (iv) is part of CAREC Corridor 2.

7 Kazakhstan’s previous Transport Strategy for 2006–2015, which supported ADB’s 1st MFF for CAREC Corridor 1, has been integrated into the 2020 Strategy, SPAID, and TSP.

8 The contents of RDP (e.g., vision, strategic focus, investment projects) remain unchanged in TSP. TSP, integrating development plans for all subsectors (roads, railways, waterways, aviation, ports), has the additional focuses: (i) transport with high-technology, competitive and international standards; and (ii) closely driven by economic interests, national security, geopolitics and businesses.

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management, asset management, and border-crossing procedures.

12. The investment program aligns with ADB's Strategy 20209 and its country operations business plan for 2010–2011, as well as CAREC’s TTFS and Action Plan. It also aligns with the Kazakhstan's 2020 Strategy, SPAID, and TSP.

13. The MFF is the modality of choice for the investment program as it strengthens the partnership between ADB and Kazakhstan that has begun with the CAREC Corridor 1 investment program.10 All the conditions for its use are in place: a coherent strategy and sector road map, policy framework, investment plan, and financing plan. Other modalities were considered and discarded.

B. Impact and Outcome

14. The investment program will contribute to sustainable economic development and regional cooperation under CAREC. The outcome will be increased transport connectivity and efficiency and institutional effectiveness.

C. Outputs

15. The outputs of the investment program will be (i) the reconstructed 790 km roads of CAREC Corridor 2 in Mangystau; (ii) strengthened capacity for planning, project management, and asset management; and (iii) improved cross-border infrastructure and facilities. The 790 km roads will include the 430 km Aktau–Manasha section, the 84 km Beineu–Akzhigit (Uzbekistan border) section, and the 237 km Zhetybai–Fetisovo section. These outputs will be achieved through two components: road development and capacity development.

16. Outputs for project 1, financed under trance 1, will be (i) the 200 km reconstructed sections (km 372.6–km 514.3 and km 574–km 632.3) of the Aktau–Manasha road, including culverts and bridges, overpasses, road signs, and signal posts along dangerous spots; and (ii) strengthened project management and institutional capacity. The capacity-development component under project 1 will support program management and institutional strengthening for the investment program. It will include (i) construction supervision and program management; (ii) feasibility studies of subsequent tranche projects; and (iii) capacity development for road construction and maintenance, procurement design, contract management, the enforcement of environmental and resettlement safeguards, and border crossing activities.

9 ADB. 2008. Strategy 2020: The Long-Term Strategic Framework of the Asian Development Bank, 2008–2020.

Manila. 10 ADB. 2008. Report and Recommendation of the President to the Board of Directors: Proposed Multitranche

Financing Facility and Administration of Loan to the Republic of Kazakhstan for the CAREC Transport Corridor I (Zhambyl Oblast Section) [Western Europe–Western People’s Republic of China International Transit Corridor] Investment Program. Manila.

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II. IMPLEMENTATION PLANS

A. Project Readiness Activities

2010 2011 Indicative Activities Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Responsible Establish project implementation arrangements

√ ADB, MOTC

Allocate government counterpart funds √ MOF, MOTC

Approve detailed design for (Tranche 1) √ MOTC,

Approve detailed design for (Packages Tranche 2)

√ MOTC,

Approve and disclose safeguards documents √ √ MOTC, ADB

• IEE with EMP √ MOTC, ADB • LARP √ MOTC, ADB

Recruit construction supervision consultant √ MOTC/COR

Invite for civil works bids (Tranche 1) ` MOTC/COR

Invite for civil works bids (Tranche 2) √ MOTC/COR

Sign loan agreement √ ADB, MOF Declare loan effectiveness √ ADB,MOF

ADB = Asian Development Bank, COR = Committee on Roads, CSRN = consulting services recruitment notice, EMP = environment management plan, IEE = initial environment examination, IFB = invitation for bids, LARP = land acquisition and resettlement plan, MOF = Ministry of Finance, MOTC = Ministry of Transport and Communications. B. Overall Project Implementation Plan

17. The projects are planned to be implemented over a period of 6 years with loan completion in June 2017 as shown in the overall program in Attachment 1. The physical implementation of Project 1 will be completed by December 2016.

III. PROGRAM MANAGEMENT ARRANGEMENTS

A. Program Stakeholders—Roles and Responsibilities

Program Stakeholders Management Roles and Responsibilities Ministry of Finance • Sign the Loan Agreement;

• Monitor, coordinate, and facilitate the investment program implementation; • Allocate and release counterpart funds; • Endorse to ADB the authorized staff with approved signatures for

withdrawal applications processing; and • Process and submit to ADB any request, when required, for reallocating

the loan proceeds. Executing Agency (Ministry of Transport and Communications)

• Oversee implementation and performance of the Program; • Liaise with ADB; and • Establish a team to manage the Program.

Implementing Agency (Committee of Roads)

• Manage and implement the Program; • Resolve issues that would compromise results' quality, costs, or

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Program Stakeholders Management Roles and Responsibilities through Mangystau Road Committee

completion time of the investments; and • Ensure safeguard compliance, legal conformity, and sound financial

management. ADB • Monitor and evaluate implementation and performance of the Program;

and • Ensure timely completion and achievement of program outputs, outcomes,

and impact. ADB = Asian Development Bank.

Key Personnel Responsibility

Program Director

• Has the overall responsibility to implement all Program activities including project preparation, implementation, monitoring, and reporting.

• Prepare and submit monthly and quarterly progress reports to ADB within 2 weeks from the end of the related quarter.

• Submit to ADB other required performance and monitoring reports. Program Management Unit (PMU)

• Consulting firms and individuals Consultants, will assist the Program Directors with engineering, finance, legal, and procurement matters;

• Introduce a suitable management information system to manage the Investment Program;

• Coordinate procurement of civil works, goods, and consultants; and ensure compliance with ADB procedures;

• Prepare bid documents and consultants' TOR, and conduct bidding, selection, and awarding processes for subsequent projects;

• Take charge of financial matters, controls and auditing, and administrative work;

• Evaluate, monitor, and report the progress for implementing the Investment Program and its projects;

• Develop a project performance monitoring system together with the Construction Supervision Consultants; and

• Prepare the TOR engagement of project specialist is needed. • Engage Consultants to assist with improving border crossing operations.

Construction Supervision Consultants

• Assist the Project Director on project implementation and safeguards compliance;

• Administer the civil works contracts including the assessment of progress claims and variation claims;

• Monitor work schedules; • Ensure compliance of the contractual clauses for both quality and

specifications of work; • Ensure safeguard compliance of civil works. Particularly, monitor

implementation of EMP, and LARPs; and • Maintain up to date and proper records e.g. daily reports

ADB = Asian Development Bank, EMP = environment management plan, LARP = land acquisition and resettlement plan, MOTC = Ministry of Transport and Communications. а Staff of the Committee of Roads appointed by MOTC. b The Program Director will be assisted by staff from Mangystau Road Department.

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B. Key Persons Involved in Implementation

Agency/Organization Name Contract Numbers A. Executing Agency

Ministry of Transport and Communications (MOTC)

Abelgazy Kussainov Minister

Tel. No. +7 7172 240077 Fax No. +7 7172 241419

Dulat Kuterbekov Vice Minister

Tel. No. +7 7172 299061 Fax No. +7 7172 243705

B. Implementing Agency

Committee of Roads, MOTC Zamir Saginov Chairman

Tel. No. +7 7172 243383 Fax No. +7 7172 299065

Nurlan Umirbayev Deputy Chairman Project Director

Tel. No. +7 7172 299042 Fax No. +7 7172 242108 Email:

C. ADB Staff

Transport & Communications Division (CWTC) Central and West Asia Department

Hong Wang Director Eunkyung Kwon Principal Transport Specialist Sunil Mitra Senior Transport Specialist Ma. Virginita A. Capulong Senior Operations Officer

Tel. No. +63 2 632 6765 Fax No. +63 2 636 2428 Email: [email protected] Tel. No. +63 2 632 5989 Fax No. +63 2 636 2428 Email: [email protected] Tel. No. +63 2 632 5651 Fax No. +63 2 636 2428 Email: [email protected] Tel. No. +63 2 632 6679 Fax No. +63 2 636 2428 Email: [email protected]

Office of the General Counsel Lyailya Nazarbekova Senior Counsel

Tel No. +63 2 632 4896 Email: [email protected]

Loan Administration Division, Controller's Department

Viliami Sefesi Financial Control Specialist


Consulting Operations Services Division 1, Central Operations Services Office

Yo Ikeda Procurement Specialist


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C. Project Organization Structure

1. Investment Program Organizational Structure

Asian Development Bank Ministry of Finance (representing the Borrower)

Ministry of Transport and Communications

(Executing Agency)

Committee of Roads (Implementing Agency)

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2. Program Management – Organization Chart

Executing Agency Ministry of Transport and Communications, Republic of Kazakhstan Asian Development Bank

Program Management Unit

The Committee of Roads Program Director

Construction Supervision Consultant (T1)


1 Contractor

CW 1

2 Contractor

CW 2

3 Contractor

CW 3

5 Contractor

CW 5

7 Contractor

CW 7

8 Contractor

CW 8

9 Contractor

CW 9

10 Contractor

CW 10


6 Contractor

CW 6

4 Contractor

CW 4

11 Contractor

CW 11

12 Contractor

CW 12

13 Contractor

CW 13

14 Contractor

CW 14

Consultants

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IV. COSTS AND FINANCING

A. Detailed Cost Estimates and Financing Plan

Detailed Cost Estimates—Tranche 1a ($ million)

ADB GOV

Item Total Amount Amount Tranche 1 A. Base Costs 1. Land acquisition and resettlement for packages 1–10 17.2 0.0 17.2 2. Civil works Package 1 (km 372.6–422) 70.8 63.2 7.6 Package 2 (km 422–472.8) 60.2 53.7 6.5 Package 3 (km 472.8–514.3) 64.6 57.7 6.9 Package 5 (km 574–632.3) 75.8 67.7 8.1

Total civil works 271.4 242.3 29.1 3. CSC 8.8c 7.8 1.0 4. Individual consultants on project management 8.2 8.2 0.0 Total base costs 305.6 258.3 47.3 B. Contingency b 27.4 24.7 2.7 C. Total Investment Cost 333.0 283.0 50.0 ADB = Asian Development Bank, GOV = government, km = kilometer. a In 2010 prices. Taxes and duties are included. b Contingency was computed at 10% of base costs. c Estimated expenditures during the Feasibility Study preparation. Source: Asian Development Bank and Ministry of Transport and Communications of Kazakhstan

B. Fund Flow Diagram

Flow of Funds Lending Loan Repayment

GovernmentCounterpart

Funds (Tranche 1)

US$50M

Borrower (Ministry of Finance)

ADB

Executing Agency (Ministry of Transport and Communications)

I. Contractors II. Consultants III. Suppliers

Direct Payment(Tranche 1) US$283M

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V. FINANCIAL MANAGEMENT

A. Financial Management Assessment

18. The Government will ensure the implementation of the financial management action plan developed for the Investment Program. The table below shows the implementation status.

Financial Management Action Plan

Activities Timeline

Status as of July

2010 Risks Measures to

Mitigate Risks 1. Assign project financial management

functions to a nominated unit within MOTC’s finance division, with suitably qualified staff to be supervised by the director of MOTC’s accounting department

within 6 months of the

project effective date

In process

2. Set up the financial management system for the project, by • developing a manual of financial

procedures • training project financial

management staff • establishing the automated

accounting system to record and report on an annual basis project transactions and generate interim financial reports.

within 9 months of the

project effective date

• No MOTC staff

members available for additional tasks

• Fast turnover of staff members, requiring retraining of new staff to build and sustain capacity

• Delays in implementing

• Provide better compensation to current staff to lower staff turnover ratio.

MOTC = Ministry of Transport and Communications. 19. Financial management assessment11 will be undertaken for the executing and implementing agencies.

B. Disbursement

20. The ADB’s Loan Disbursement Handbook12 (2007) will guide the disbursement of loan proceeds for the three projects. The contracts for civil works and consulting services will use direct payment procedures. No imprest account will be required.

21. ADB funds may not be applied to the activities described on the ADB Prohibited Investment Activities List set forth at Appendix 5 of the Safeguard Policy Statement (SPS) (2009).13 All financial institutions will ensure that their investments are in compliance with applicable national laws and regulations and will apply the prohibited investment activities list (Appendix 5) to subprojects financed by ADB.

22. Before the submission of the first withdrawal application, the borrower should submit to ADB sufficient evidence of the authority of the person(s) who will sign the withdrawal applications on behalf of the borrower, together with the authenticated specimen signatures of each authorized person.

11 Available at: http://www.adb.org/Documents/Others/FM-toolkit/Methodology-Note.pdf, and Financial Management.

See also Analysis of Projects Guidelines (2005): http://www.adb.org/Documents/Guidelines/Financial/default.asp. 12 Available at: http://www.adb.org/Documents/Handbooks/Loan_Disbursement/loan-disbursement-final.pdf 13 Available at: http://www.adb.org/Documents/Policies/Safeguards/Safeguard-Policy-Statement-June2009.pdf

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23. The minimum value per withdrawal application is US$100,000, unless otherwise approved by ADB. The borrower will consolidate claims to meet this limit for reimbursement claims. Withdrawal applications and supporting documents will demonstrate, among other things that the goods, and/or services were produced in or from ADB members, and are eligible for ADB financing.

24. The table below shows the withdrawal application processing schedule:

Withdrawal Application Processing Schedule

1 2 3 4 5

Steps

IPC/ Invoice Submission by

Contractor/Consultant WA Preparation

at MTOC WA Processing

at MOF

WA Submission to

ADB WA Processing

at ADB Duration 6 Working Days 3 Working Days 5–10 Working

Days 1 Working Day 5–10 Working

Days Details Civil Works

• Contractor submits the IPC to Construction Supervision Consultant (CSC)

• CSC reviews, and approves IPC

• CSC submits the IPC to PMC for review and endorsement

• PMC submits the IPC to COR

Consulting Services • Consultant submits

the invoice to PMU for review and endorsement

• PMC submits the invoice to COR

• COR reviews and approves the IPC or invoice; and ensures that supporting documents are in place.

• COR prepares the WA based on the IPC or invoice. COR ensures the proper completion of WA form and summary sheets based on ADB guidelines

• COR's authorized representative signs the WA

• COR submits the WA to MOF

• MOF reviews and approves the WA

• Authorized representative signs the WA

• COR follow-ups WA with MOF

• COR submits the scanned copy of the WA to CTL cc: CWTC, KARM

• COR sends original copy of the WA to CTL through courier

• CTL pre-processes the scanned copy of WA

• Once original copy of the WA is received, CTL reviews the scanned copy against the original copy; and releases the voucher

• TD releases payment and issues the payment instructions

• ADB, and MOTC monitors the processing status through LGFIS website.

CSC = Construction Supervision Consultant, COR = Committee on Roads, CTL = ADB's controller department, IPC = interim payment certificate, KARM = Kazakhstan Resident Mission, LGFIS = loan and grant financial information system, PMU = program management unit, TD = ADB's treasury department, WA = withdrawal application.

25. MOTC will maintain a Withdrawal Application Monitoring Matrix to monitor the progress of the withdrawal application processing, and submit to ADB every 10th of the month.

26. MOTC will submit the annual disbursement projections, including contract awards projections, to ADB, and will be responsible for requesting budgetary allocations for counterpart funds. Ministry of Finance (MOF) will make available all counterpart funds required for timely and effective implementation of the Project through annual budget allocations to MOTC.

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C. Accounting

27. MOTC will maintain separate project accounts for each packages and records by (i) project components, (ii) type of goods and services, and (iii) funding sources for all expenditures incurred on the Project. Project accounts will follow Government's accounting laws and regulations.

D. Auditing

28. MOTC will engage independent auditors acceptable to ADB to audit project accounts and financial statements annually, and will arrange a periodic or annual audit of statement of expenditure transactions. MOF will submit to ADB certified copies of audited annual project accounts and related financial statements as well as the auditor’s report in English within 6 months of the end of each fiscal year during implementation.

29. The Government and MOTC are aware of ADB’s policy on delayed submission, and the requirements for satisfactory and acceptable quality of the audited accounts. ADB reserves the right to verify the project's financial accounts to confirm that the share of ADB’s financing is used in accordance with ADB’s policies and procedures.

VI. PROCUREMENT AND CONSULTING SERVICES

A. Advance Contracting

30. ADB approved advance contracting for civil works to be financed by ADB under the MFF. Advance contracting will follow ADB’s Procurement Guidelines14, and Guidelines on the Use of Consultants15. ADB will approve the issuance of invitations to bid, and advised the MOF and MOTC that this does not commit ADB to finance any ensuing projects from the MFF. Advance contracting activities will include (i) preparation of tender documents, (ii) evaluation of bids, and (iii) recruitment of consultants. The contracts will be awarded after loan effectiveness.

B. Procurement of Works, and Consulting Services

1. Procurement of Civil Works

31. All procurement of works will follow ADB’s Procurement Guidelines. Civil works contracts over $3 million will be procured through international competitive bidding (ICB) using post-qualification and single-stage one-envelope procedure. ADB’s prior review procedures will be followed.

32. MOTC agreed to include the relevant sections of ADB’s Anticorruption Policy (1998) in all bidding and contractual documents. MOTC will also (a) ensure that all Works contracts include a contractor's obligation to comply with road safety measures; and (b) monitor the accident rate and traffic volume during the operation of the Project Road.

33. The procurement plan indicating threshold and review procedures, works, and consulting service contract packages is in Section C.

14 Available at: http://www.adb.org/Documents/Guidelines/Procurement/Guidelines-Procurement.pdf 15 Available at: http://www.adb.org/Documents/Guidelines/Consulting/Guidelines-Consultants.pdf

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2. Consulting Services

34. Consultant recruitment will follow ADB’s Guidelines on the Use of Consultants16 and the procurement plan for the Project. Consulting firms will be selected and engaged using the quality- and cost-based selection method with a standard quality-cost ratio of 90:10, and full technical proposals The reason for this ratio is because of the high impact, where the consequences of failure could be high, leading to economic, financial, social, or environmental loss. Section D provides the overview of the terms of reference for all consulting services.

C. Procurement Plan

1. Project Procurement Thresholds

35. Except as the Asian Development Bank (ADB) may otherwise agree, the following process thresholds shall apply to procurement of works.

Procurement of Works

Method Threshold International Competitive Bidding (ICB) for Civil Works

> $3,000,000

2. ADB Prior or Post Review

36. Except as ADB may otherwise agree, the following prior or post review requirements apply to the various procurement and consultant recruitment methods used for the project.

Procurement Method Prior or Post Comments Procurement of Works International Competitive Bidding (ICB) Prior Recruitment of Consulting Firms Quality- and Cost-Based Selection (QCBS) Prior Quality Cost Ratio 90:10

3. Works Contracts Estimated to Cost More Than $1 Million

37. The following table lists works contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

($ million) Procurement

Method Prequalification of Bidders (y/n)

Advertisement Date (quarter/year) Comments

Civil Works 288.6 ICB N October 2010 Financing by ADB and KAZ

ADB = Asian Development Bank, ICB = international competitive bidding, KAZ = Kazakhstan, N = no.

16 Checklists for actions required to contract consultants by method available in e-Handbook on Project

Implementation at: http://www.adb.org/documents/handbooks/project-implementation/

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4. Consulting Services Contracts Estimated to Cost More Than $100,000

38. The following table lists consulting services contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

($ million) Recruitment

Method1

Advertisement Date

(quarter/year)

International or National Assignment Comments

1. Construction Supervision

20.4 QCBS November 2010 International Financing by ADB and KAZ

2. Project Management

15.0 QCBS*

November 2010 International Financing by ADB and KAZ

ADB = Asian Development Bank, KAZ = Kazakhstan, QCBS = quality- and cost-based selection. * Subject for revision.

5. Indicative List of Packages Required Under the Project 1

39. The following table provides an indicative list of all procurement (goods, works and consulting services) over the life of the project. Contracts financed by the Borrower and others should also be indicated, with an appropriate notation in the comments section.

General Description

Estimated Value

(cumulative, $ million)

Estimated Number of Contracts

Procurement Method

Domestic Preference Applicable1 Comments

Tranche 1 Package 1 (km 372.6–422) 70.8 1 ICB No Financing by

ADB and KAZ Package 2 (km 422–472.8) 60.2 1 ICB No Financing by

ADB and KAZ Package 3 (km 472.8–514.3) 64.6 1 ICB No Financing by

ADB and KAZ Package 5 (km 574–632.3) 75.8 1 ICB No Financing by

ADB and KAZ ADB = Asian Development Bank, ICB = international competitive bidding, KAZ = Kazakhstan, km = kilometer.

General Description

Estimated Value

(cumulative, $ million))

Estimated Number of Contracts

Recruitment Method2

Type of Proposal3 Comments

1. Construction Supervision Consultant

8.8 1 QCBS (90:10a,

International & National

Assignments)

Full Technical Proposal

Financing by ADB and KAZ

2. Project Management Consultant

8.2 1 Individual or QCBSb (90:10a,

International & National

Assignments)

Full Technical Proposal

Financing by ADB and KAZ

ADB = Asian Development Bank, KAZ = Kazakhstan, QCBS = quality- and cost-based selection. a 90:10 ratio will be used since the impact of the consultant’s assignment is major (PAI 2.02 A). b Subject for revision.

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D. Consultants’ Terms of Reference

40. The following provides the overview of the terms of reference for the consulting services while Attachment 2 provides the detailed terms of reference.

41. Program Management Consultant. Program Management Consultants will be engaged to assist the MOTC and the Program Director in the (i) overall project management of the Investment Program; (ii) procurement of civil works, and recruitment of consultants; and (iii) project preparatory for the subsequent projects. In addition, individual consultants will be hired to strengthen border crossing operations. The TORs for these consultants will be updated in this FAM with more details including the person months as these resources are being discussed within the Government.

42. Construction Supervision Consultant. A consultant will be engaged for each tranche of the Investment Program to perform as the Engineer of the Project. The consultant will administer the construction contracts and ensure that the contractual clauses for both quality and specifications of work are complied with, and the works are constructed in accordance with the provisions of the construction contracts. The consultant’s representative will be a full-time professional resident engineer in the project area in accordance with the provisions of the construction contracts.

43. Auditors. An auditor will be engaged to prepare annual audited project accounts reports. MOTC will submit these reports regularly to enable ADB to monitor loan use.

VII. SAFEGUARDS17

A. Environment

44. The Environmental Assessment and Review Framework (EARF)18 prepared for the investment program and the Initial Environmental Examination (IEE) for the Project was prepared, along with the Environmental Management Plan (EMP) (Attachment 3). ADB classified the Project as Category B as no significant negative environmental impacts are expected. The estimated cost for mitigation and environmental monitoring is $ 0.767 million.

45. MOTC will ensure (a) that the design, construction, operation and maintenance of the Project facilities are carried out in accordance with ADB’s Safeguard Policy Statement (2009), and the Kazakhstan's environmental laws and regulations; and (b) potential adverse environmental impacts arising from the Project are minimized by implementing all mitigation and monitoring measures as presented in the EMP.

46. MOTC will ensure that (a) the EMP is updated prior to issuance of any notice to proceed; (b) sufficient resources are made available to implement, monitor, and record the implementation of the EMP; (c) semi-annual environmental monitoring reports are prepared and submitted to ADB within one (1) month of the end of each period covered; (d) the reports include, inter alia, a review of progress made on the implementation of the EMP, problems encountered and remedial measures taken; (e) the detailed engineering design and the Works contracts under the Project incorporate applicable environmental measures identified in the IEE and the EMP; and (f) contractors are supervised to ensure compliance with the requirements of the IEE and the EMP.

17 Checklists for implementing safeguards actions will be made available. 18 The Environment Assessment and Review Framework was posted at the ADB website on 12 August 2010.

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B. Land Acquisition and Resettlement

47. The Land Acquisition and Resettlement Framework (LARF)19 was prepared for the investment program and the Land Acquisition and Resettlement Plan (LARP) for Tranche 1 (Km 372–514; Km 574–632: Manasha–Shetpe Section). ADB reclassified the Project as IR Category B as there are no expected major resettlement impacts. For Tranche 1, 63.46 ha of State-owned lands will be needed permanently. Of these, 27.91 ha is leased to 8 households and 1 legal entity. During construction, 358.93 ha of land will be used temporarily as temporary bypasses, access to construction sites and sites for construction materials. Of which, 109.48 ha is leased to 1 household and 3 legal entities. Permanently affected pasturelands will be replaced with an equivalent land, while temporarily acquired lands will be rented based on current rental rates in the locality and will be restored to their original condition by the civil works contractors. For Tranche 1, cost of LARP implementation is estimated at $1.77 million including cost for land restoration, LAR administrative oversight, monitoring and evaluation activities. The Government has already allocated an initial budget of $17.2 million to cover all land acquisition related activities for Tranches 1 and 2 of the MFF, including expenses related to relocation of some utilities and structures by major industrial companies covered in the subsequent tranches. Impact of civil works for tranches 2 and 3 has not been assessed. Such will be determined during the preparation of feasibility study, when these tranches will be screened in terms of impact on land acquisition and resettlement.

48. MOTC will ensure that Project 1 is carried out in accordance with the Borrower’s applicable laws and regulations, ADB’s Safeguard Policy Statement (2009), the LARF and the LARPs including, inter alia, the following provisions:

• the draft and final LARP shall be disclosed to affected persons; • the final LARP shall be submitted to ADB for review and clearance prior to award of

any Works contract; • all land and rights of way required by the Project shall be acquired and made

available in a timely manner; • all compensation and resettlement assistance shall be provided to affected persons

prior to their displacement and dispossession and the compensation program of the LARP shall be fully implemented prior to issuing any notice to proceed;

• efficient grievance redress mechanisms shall be in place to assist affected persons resolve queries and complaints if any, in a timely manner;

• adequate staff and resources shall be made available for supervising and monitoring the implementation of the LARP. An external monitoring agency, acceptable to ADB, shall carry out external monitoring and evaluation of the LARP and shall report the results to ADB at the start and completion of the LARP implementation process; and

• if during implementation of the LARP, any changes to the location, land alignment of roads, or additional environmental and/or resettlement impacts are identified, the LARP shall be updated and prior approval by ADB and the relevant government agencies shall be obtained before further implementation of the LARP.

49. The Construction Supervision Consultant (CSC) will undertake internal monitoring of LARP-related activities including temporary acquisition during civil works implementation. An External Resettlement Monitor will be engaged to validate the internal resettlement monitoring reports and evaluate compliance of activities with the LARP.

19 The LARF and LARP for Tranche 1 were posted at the ADB website on 11 August 2010.

17

C. Indigenous People (IP)

50. None of the ethnic groups in the Tranche (Project) 1 area maintain cultural and social identities separate from the mainstream Kazakhstan’s society fitting the ADB definition of Indigenous Peoples. They have full and equal access to institutions and economic opportunities as the rest of the population. Because of this, Tranche 1 is classified as IP Category C.

D. Labor, Gender, Health, and Social Protection

51. The Project is expected to create positive impacts on labor creation, as well as, women and children’s access to health services. However, risks related to unfair labor practices, exclusion of vulnerable groups from Project benefits, human trafficking and HIV/Aids need to be addressed. Related to these, MOTC will ensure that (a) the Works contracts incorporate provisions to the effect that contractors shall (i) comply with applicable core labor standards, labor laws and incorporate applicable workplace occupational safety norms; (ii) not differentiate payment between men and women for work of equal value; (iii) not employ child labor in the construction and maintenance activities; and (iv) to the extent possible, maximize employment of local poor and disadvantaged persons for project construction purposes, provided that the requirements for job and efficiency are adequately met; and (b) disseminate information on the risks of sexually transmitted diseases, including human immunodeficiency virus/acquired immunodeficiency syndrome, to the employees of the Works contractors under the Project and to members of the local communities surrounding the Project Road. Likewise, MOTC shall ensure that concrete and rigorous measures to detect and prevent illegal trafficking on the Project Road are fully implemented.

52. Gender will also be mainstreamed in the LARP preparation and implementation to ensure that women and men are equally informed about the project and encouraged to participate in LAR-related activities. During the LARP updating/finalization, displaced women-headed households, poor households and other vulnerable groups will be identified and informed of the consultation dates and venues. Focus-group-discussions with these groups will be conducted to ensure that they are aware and properly informed of their rights, compensation, entitlements and types of assistance, as well as, seek inputs on their concerns, preferences, and recommendations. During LARP implementation, the Mangistau Oblast Department of Road (DoR) will assign a staff to: (i) inform in advance the DPs, including women-headed households and vulnerable groups, at least 45 days prior to demolition of their structures; (ii) persuade the housewives to be with their husband when receiving payment for compensation and assistance from CoR; (iii) encourage any women members of the households to participate in the monitoring and evaluation that will be conducted by the External Resettlement Monitor; (iv) involve women of displaced households and vulnerable groups in the locality in addressing the unanticipated social and environmental impacts during Project implementation. Moreover, with the consent of the DPs, the names of both spouses will be reflected in the re-registration of the remaining land. The budget, implementation arrangement, and monitoring will be integrated in the LARP implementation and monitoring arrangement with the CSC. Progress reports with socio-economic data disaggregated by gender will provide periodic updates on the effects of LAR on women.

E. Execution of Contracts for Works

53. MOTC will ensure that, subsequent to award of the Works contracts, no notice to proceed is issued to contractors for the respective sections or parts of the Project Road until the applicable provisions of the LARP (including, in particular, the provision on the timely payment of compensations to affected persons), the EIA, and the updated EMP have been complied

18

with.

VIII. PERFORMANCE MONITORING, EVALUATION, REPORTING AND COMMUNICATION

A. Design and Monitoring Framework for the Investment Program

Design Summary Performance Targets and Indicators with Baselines

Data Sources and Reporting Mechanisms Assumptions and Risks

Impact By 2020 Contribution to sustainable economic development and regional cooperation under CAREC

Increased GDP of Kazakhstan to $300 billion from $114 billion in 2009

National and local socioeconomic statistics from the Central Statistics Office

Assumption The government sustains policies conducive to economic growth and remains committed to policy reforms and regional cooperation and integration.

Outcome By 2016 Assumptions Increased transport connectivity and efficiency and improved institutional effectiveness

Increased traffic volume to 3,500 vpd from 1,000 vpd in 2009 Reduced road-user costs to $0.43/vehicle-km from $0.64/vehicle-km in 2010 National road safety improvement strategy with action plans prepared and implemented Reduced travel time between Aktau and Beineu to 4 hours from 12 hours in 2009 Average processing time per truck at border-crossing points reduced to 30 minutes from 1.5 hours Number of accidents per year on the investment program road reduced to 140 from 152 in 2009

National and local statistics from the Central Statistics Office Periodic classified traffic counts and accident data system CAREC CPMM reports Mangystau Oblast socioeconomic survey data

The availability and quality of transport services improve following the improvement of investment program roads. Improved cross-border facilities and procedures at the border between Kazakhstan and Uzbekistan. Macroeconomic conditions persistently improved Risks Financial resources for road maintenance are inadequate. Asset management system is unimproved.

Outputs Assumptions 1. Mangystau Oblast

sections of CAREC Corridor 2 reconstructed

790 km of roads reconstructed with pavements whose international roughness index is less than 4 meters per km by 2016 HIV and human trafficking awareness program implemented by 2011

MOTC progress reports Mangystau Oblast socioeconomic survey data

Counterpart resources timely provided Contractors procured through international competitive bidding Support is forthcoming from local communities.

19

Design Summary Performance Targets and Indicators with Baselines

Data Sources and Reporting Mechanisms Assumptions and Risks

2. MOTC’s capacity for project and asset management strengthened

Program management unit effectively functioning Timely submission of subsequent tranche projects to ADB Computerized road management system implemented by 2016

MOTC progress reports PFRs submitted to ADB List of counterpart staffers who received training and their program details

The government is committed to further reforming the road sector. MOTC and the Committee of Roads remain committed to capacity strengthening.

Performance-based contract for routine maintenance piloted by 2015 Tranche 3 project prepared and implemented by MOTC with less consultant input

Qualified experts for capacity development are recruited in a timely way. Staff competently complete training and return to the investment program.

3. Cross-border infrastructure and facilities improved

Facilities and infrastructure at border crossing between Uzbekistan and Kazakhstan modernized by 2016 Training of officials working at border with Uzbekistan completed by 2016

MOTC progress reports CPMM

Assumption Coordination of authorities is smooth. Risk Delays in border-crossing improvement and CBTA implementation

Activities with Milestones Inputs Tranche 1: 1.1 Recruitment of construction supervision consultants and program management

consultants by April 2011 1.2 Award of civil works contracts by May 2011 1.3 Physical works completed by February 2014 1.4 Capacity development plan completed by May 2011 1.5 Training programs commenced by June 2011 and completed by December 2016 Tranche 2: 2.1 Award of civil works contracts by July 2011 2.2 Completion of civil works by December 2014 Tranche 3: 3.1 Award of civil works contracts by February 2013 3.2 Completion of civil works by June 2016

ADB: MFF not exceeding $800 million Government: $412 million Total: $1,212 million

ADB = Asian Development Bank, CAREC = Central Asia Regional Economic Cooperation, CBTA = cross-border transport agreement, CPMM = corridor performance measurement and monitoring, GDP = gross domestic product, km = kilometer, MFF = multitranche financing facility, MOTC = Ministry of Transport and Communications, PFR = periodic financing request, PMU = program management unit, vpd = vehicle per day. Sources: Asian Development Bank and Ministry of Transport and Communications of Kazakhstan.

20

B. Project Monitoring20

54. Project Performance Monitoring System. MOTC will establish a project performance monitoring system (PPMS) within 6 months of the Effective Date and collect baseline data for performance monitoring. It will develop a Project Performance Monitoring System. The key indicators and assumptions outlined at the impact and outcome levels in the Project design and monitoring framework will be the primary data required for analysis. The PMU is responsible for daily monitoring, reporting, and evaluating the progress for implementing the Project, and maybe tasked to develop the PPMS.

55. Compliance monitoring. The loan covenants on policy, legal, financial, economic, environmental, labor standards and others will be monitored regularly through various reports (monthly progress reports, quarterly progress reports, and annual reports), and discussion during review missions.

56. Safeguards monitoring. The monitoring and reporting of the activities identified in the environment and resettlement action plans is discussed in Section VII.

57. Gender issues monitoring. Monitoring of actions and progress in addressing gender-related aspects of the Project will be integrated into the Project Performance Monitoring and LARP- internal and external monitoring. Indicators to be used include (a) maternal and children mortality rates in rural raions along the road corridor; (b) gender-segregated information on employment and pay in Project activities; (c) number and type of activities conducted to disseminate information on HIV/Aids in workers’ camps and nearby communities; and (d) number and type of activities conducted to detect and prevent illegal trafficking on the Project Road. LARP internal and external monitoring report will also include gender-segregated reporting on involvement of DPs in LARP preparation and implementation activities.

C. Reviews

58. ADB will field at least three review missions annually to discuss implementation progress and assess the project implementation, including procurement, civil works, financing status, and environmental and social safeguards based on quarterly progress reports.

59. A mid-term review mission will be carried out 2 years after each loan becomes effective (1.5 years for tranche 3 loan). The mid-term review will focus on (i) implementation progress; (ii) road subsector reform and performance; (iii) performance of consultants and contractors; (iv) status of compliance with the understandings in the framework financing agreement (FFA) and the covenants in the loan agreement; and (v) the need for any midcourse changes in the scope or schedule of the Tranche projects to ensure full achievement of its impact.

D. Reporting

60. MOTC will submit to ADB (i) brief monthly reports; (ii) quarterly progress reports in a format consistent with ADB's project performance reporting system, within 2 weeks of the end of each quarter covered; (iii) midterm review report, and (iv) a project completion report21 within 3-6 months of physical completion of the Project. Attachment 5 presents the templates for monthly report and quarterly progress report. 20 ADB's project performance reporting system is available at:

http://www.adb.org/Documents/Slideshows/PPMS/default.asp?p=evaltool 21 Project completion report format available at: http://www.adb.org/Consulting/consultants-toolkits/PCR-Public-

Sector-Landscape.rar

21

61. An Investment Program annual report will cover issues related to each of the components and will report on inputs and outputs and start generating information for the outcome and impact indicators of the design and monitoring framework.

62. MOF will furnish to ADB, not later than six (6) months after the end of each related fiscal year, certified copies of such audited accounts and financial statements and the report of the auditors relating thereto (including the auditors' opinion on the use of the Loan proceeds and compliance with the financial covenants of this Loan Agreement), all in the English language; and other project account and financial related information. To ensure projects continue to be both viable and sustainable, project accounts and the executing agency audited financial statements, together with the associated auditor's report, should be adequately reviewed. The TOR for Auditors is in Attachment 2.

E. Stakeholder Communication Strategy

Project Documents Means of Communication Party Responsible

Audience Frequency

PID ADB website ADB General Public Quarterly updates FFA ADB website ADB General Public Always available online RRP ADB website ADB General public Posted within 2 weeks of

loan approval; Always available online

Loan agreement ADB website ADB General public Always available online Environmental Assessment Reports (IEE and EARF)

ADB and EA websites, Public consultations and Brochures/leaflets for affected people

ADB, MOTC General public, Affected people

IEE or EIA and EARF posted on the websites before project apprisal; Documents always available online at ADB and EA websites; EMP updated regularly

Land Acquisition and Resettlement Frameworks and Plans

ADB and EA websites, Public consultations and Brochures/leaflets for affected people

ADB, MOTC General public, Affected people

LARPs posted before contract awards; Document always available online at ADB and EA websites

Procurement requirements

ADB website for procurement notice (ACN/ SPN), invitation for bids (IFB), Local newspaper advertisement

MOTC General public, potential civil works contracting firms

Available online (current and archive)

Consulting services requirement

ADB website for recruitment notice (CSRN) for expression of interest

MOTC General public, consulting firms

When required.

ADB website for list of shortlisted firms

ADB General public, consulting firms

Always available (current and archive)

Request for proposals, public opening

MOTC Potential consulting firms

Facility Administration Manual

ADB website ADB, MOTC General public, project contractors and consultants

Document always available online; updated regularly

ADB=Asian Development Bank, ACN= advance contracting notice, EARF = environmental assessment and review framework, CSRN = consulting services recruitment notice, FFA = framework financing agreement, IEE = initial environmental examination, IFB = invitation for bids, MOF = Ministry of Finance, MOTC = Ministry of Transport and Communications, PID = project information document, RRP = Report and Recommendation of the President, SPN = specific procurement notice.

22

IX. ANTICORRUPTION POLICY

63. ADB reserves the right to investigate, directly or through its agents, any violations of the Anticorruption Policy relating to the Project.22 All contracts financed by ADB shall include provisions specifying the right of ADB to audit and examine the records and accounts of the executing agency and all Project contractors, suppliers, consultants and other service providers. Individuals/entities on ADB’s anticorruption debarment list are ineligible to participate in ADB-financed activity and may not be awarded any contracts under the Project.23

64. To support these efforts, relevant provisions are included in the loan agreement and the bidding documents for the Project. MOTC will (a) conduct periodic inspections on the contractors’ activities related to fund withdrawals and settlements; (b) ensure that the construction supervision consultant verifies the contractors’ payment certificates in accordance with working drawings and contract specifications; and (c) ensure that the anticorruption action plan24 developed for the Investment Program and agreed with ADB is implemented.

Anticorruption Action Plan1

Item Action Plans Status as of ____

Training Fiduciary staff training will start from project launch and periodically take place thereafter, customized to procedures and methods required for the next 12 months under World Bank assistance. On-the-job training and regional training offered by World Bank will be provided.

Prior review Intensive and close supervision will be provided by ADB staff. All contract amendments will be subject to prior approval by ADB.

Publication of advertisements and contracts

All publications of advertisements and contract awards, including the results of the awards, will be done in accordance with ADB guidelines and published in the client connection system, on external websites.

Debarred firms Appropriate attention will be given to the need to ensure that debarred firms or individuals are not given opportunities to compete for ADB-inanced contracts.

Complaints All complaints by bidders will be diligently addressed and monitored in consultation with ADB.

Procurement committee

The World Bank will review and comment on the qualifications and experience of proposed members of the procurement committee(s), with a view to avoiding nomination of unqualified or biased candidates. All members will be required to sign a disclosure form.

Civil works supervision

A procurement committee will be established under the MOTC. Contractors carrying out reconstruction of road works contracts will be supervised by technically qualified supervisors, selected by the procurement committee, to ensure that the quality specified in the contract is delivered in a timely manner.

Monitoring of contract awards

All contracts are required to be signed within the validity of the bids/proposals and, in case of prior review contracts, promptly after the no objection is issued. The procurement plan format shall include information on actual dates (of no objections and award) and will be monitored for cases of delay which will be reviewed on a case-by-case basis to identify the reasons.

Monitoring of payments

All contracts shall include bank account information. The bank account shall be in the name of the same contractor/supplier/consultant that submitted the bid and awarded the contract. Payments to local contractors, suppliers, consultants shall be made in local currency only and paid to the

22 Available at: http://www.adb.org/Documents/Policies/Anticorruption-Integrity/Policies-Strategies.pdf 23 ADB's Integrity Office web site is available at: http://www.adb.org/integrity/unit.asp 24 GACAP II Guidelines available at: http://www.adb.org/Documents/Guidelines/GACAP-II-Guidelines.pdf. See also

Sourcebook: Diagnostics to Assist Preparation of Governance Risk Assessments: http://www.adb.org/documents/books/Diagnostics-to-Assist-Preparation-of-GRAs/default.asp.

23

Item Action Plans Status as of ____ accounts of banks located within the country.

Monitoring of payment versus physical progress

The reports to ADB will be customized to include a form to monitor physical progress compared to payment installment to avoid upfront loaded payments.

Timeliness of payments

Payment to contractors, suppliers, and consultants will be monitored through semiannual interim unaudited financial reports to ensure timely payments. The procurement committee will maintain a system/database to ensure that payments to the suppliers and contractors are paid without delay according to the conditions of the contract.

ADB = Asian Development Bank, MOTC = Ministry of Transport and Communications. 1 The international financial institutions will harmonize and consolidate their efforts in mitigating the risk of corruption. The measures above proposed by the World Bank will apply to the Investment Program.

X. ACCOUNTABILITY MECHANISM

65. The public may initially course their complaints or queries through their local self-government heads. In case the heads of the rural settlement cannot resolve or clarify the issue at their level within one week, they can then forward the case to the Grievance Focal Points at the raion Akimat. If the issue cannot be resolved in two weeks, the Akimat will then pass the complaint to the Grievance Focal Point at the MDoR. Issues requiring attention or action from the CoR will be forwarded by the MDoR. If the case remains unsolved a complaint can be lodged to the court.

66. Alternatively, people with concerns about the Project may contact the CoR Office in Astana for their concerns. The CoR will designate a staff (Grievance Focal Point) who will receive, follow-up and report on a monthly basis all complaints, disputes or questions received about the Project. Likewise, the public may contact the ADB Resident Mission Office in Astana or the ADB Task Team Leader for the Project.

67. The following standards will be used in responding to or referring complaints received by the Project:

Levels/Stages Responsibility Steps In Complaint Handling Village-level Head of Local Self

Government Registers the complaint and attempts to solve it. If complaint is not resolved in one week, it is passed to the regional Akimat for resolution.

Regional-level Vice Akim,

Grievance Focal Point Receives the complaint, registers it and attempts to resolve it. If there is no resolution in 2 weeks, it is passed to MDoR

MDoR Deputy Director, DoR

Receives the complaint and attempts to resolve it. If there is no resolution within 2 weeks, it will be passed to the appointed official at the Committee of Roads RK

CoR Grievance Focal Point Receives the complaint and coordinate with the concerned units or

agencies to find timely solution. If there is no resolution within 2 weeks, the case will be presented to a Kazakh court and resolved according to Kazakh’s legislation.

Court Raion court Hears the case and renders decision. 68. The complaints resolution process for the Project be disseminated through information brochures and posted to the offices of the rural village heads, the raion akimats and the MDoR.

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XI. RECORD OF FAM CHANGES

FAM Version Revision Date Reasons Affected Contents

25

Attachment 1 IMPLEMENTATION SCHEDULE

6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 7

Tranche 1 - Construction Activities ( Package 1,2,3&5)

Design Development 3

Preparation and Approval of Bidding Documents 3

Bidding for Civil Works 6

Mobilization & Construction 30

Procurement of Supervision & Project Management Consultants (All Packages) 9

Project Management & Institutional Support

Engagement of Supervision Consultants ( All Tranches )

Tranche 2 - Construction Activities ( Packages 4,6 to10)





Mid Term Review (All Packages)

Tranche 3 - Construction Activities ( Package 11 to 14 & Cross Border

Infrastructure)





MFF- CAREC Corridor 2 (Mangystau Oblast Sections) Investment Program - Implementation Schedule2015 20162013 2014Project Timeline Duration

(month)2010 2011 2012

Loan Approval

Winter BreakLoan Effective

Supervision Consultant will continue till end of Defects Liability Period

Winter Break

End Dec 2016

26

Attachment 2

TERMS OF REFERENCE OF CONSULTANTS

I. CONSTRUCTION SUPERVISION PACKAGE— Tranche 1

A. Introduction Civil works will be carried out based on the International Federation of Consulting Engineers (FIDIC) contract. A consultant team will be engaged for the Investment Program to perform as the Engineer. The consultant will administer the construction contracts and ensure that the contractual clauses for both quality and specifications of work are complied with, and the works are constructed in accordance with the provisions of the construction contracts. The Engineer’s representative will be a full-time professional resident engineer in the project area in accordance with the provisions of the construction contracts. B. Scope of Services The tasks of the consultant will include but not be limited to the following:

(i) Ensure that the construction methods proposed by the contractor for carrying out the works are satisfactory and in accordance with the conditions of contract.

(ii) Inspection of contractor’s construction equipment, results of material and soil tests, safety of the works, property and personnel.

(iii) Ensure that road safety design requirements are implemented in accordance with the contract.

(iv) Establish efficient procedures for verifying contractor performance and reporting progress and problems in a timely manner, including quality control reports, quantity survey records, requests for variation or change orders, and contractor’s claims and invoices.

(v) Undertake project performance monitoring and evaluation in accordance with the project framework and ADB’s Project Performance Management System Handbook, including the baseline data survey and the following annual survey and reporting up to project completion.

(vi) Ensure that the contractor does not involve child labor in the execution of the civil works contracts in accordance with the provisions of the contract agreement.

(vii) Undertake supervision works; and prepare and issue the following reports, whose format and content should be acceptable to the employer: an inception report, a brief monthly progress report, a detailed quarterly report, and a detailed project completion report.

(viii) Evaluate time, cost and adjustments submitted during the course of the project by the contractor.

(ix) Check that “as built” drawing is prepared by the contractors for all works as construction processes.

(x) Carry out the following duties related to environmental mitigation, with particular reference to the technical requirements of sound environmental standards on the basis of ADB’s Environmental Guidelines for Selected Infrastructure development Projects (Highways and Roads) during construction: (a) ensure that all the environmental mitigation measures required to be implemented are incorporated in the contract documents; (b) supervise and monitor the implementation of environmental mitigation measures required; and (c) in the event of occurrence

27

of any unexpected environmental impacts, coordinate with the EA/PD to provide necessary mitigation measures for submission to the Committee of Roads and ADB.

(xi) Monitor contractors’ compliance with and performance of required actions regarding HIV/AIDS, human trafficking, and labor core standards in accordance with the contract documents, such as awareness and education of laborers and workers.

(xii) Prepare draft project completion report at 90% physical completion. (xiii) Prepare final project completion report 2 months after physical completion of the

Project, or on an alternative date as agreed with the Committee of Roads. (xiv) Process interim and final payments of the contractors.

If so required by Program Director, the supervision consultant will provide any of the following as additional services: (i) prepare reports, including technical appraisals, additional contract documentation, and/or review and comment on the contractor’s proposals, as may be required for the successful completion of the Project; and (ii) provide any other specialist services as may be required from time to time. Program Director will authorize all additional services, other than minor extras that do not materially affect the scope of the supervision work, at the rates established in the construction supervision contract, or at the rates mutually agreed upon when the services require the use of specialists not listed in the contract. C. Input The services will be carried out by an international firm in association with national consultants, to be selected by the EA in accordance with ADB’s Guidelines on the Use of Consultants (2010, as amended from time to time). A total of 106 person-months of international consultant inputs and 408 person-months of national consultants will be required. Consulting services are expected to take place over 30 months, including services intermittantly. The team leader will be a senior civil engineer with sufficient experience in road construction. The other experts should also have relevant qualifications and experience. All experts, international and national, must be proficient in both written and spoken English. It is desirable for international consultants to have basic knowledge of Russian.

Table A1: Staffing for Program

SI No. Position No. No. of Months Person Months International Consultants 1 Team Leader 1 30 30 2 Quality and Material Engineer 1 30 30 3 Pavement Engineer 1 30 30 4 Contracts Specialist 1 6 6 5 Environmental Specialist 1 2 2 6 Social Development Specialist 1 2 2 7 Road Safety Engineer 1 6 6 National Consultants 1 Assistant Resident Engineer 4 30 120 2 Quality and Material Engineer 4 30 120 3 Quantity Surveyor 4 30 120 4 Site Inspector 4 30 120 5 Road Safety Engineer 1 30 30 6 Bridge Engineer 1 30 30

Source: Asian Development Bank and Ministry of Transport and Communications of Kazakhstan

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D. Deliverables The consultant will prepare monthly reports on the Project progress in a format and level of detail agreed with MOTC and ADB. The consultant will maintain records documenting information supplied by the field teams, decisions made at meetings, progress on civil works, certified achievements and milestones, financial records, and any deviations from or changes to the contract plans. The consultant will assist MOTC in preparing quarterly project progress reports, a project completion report, and monitoring and evaluation reports as required under the Loan Agreement. E. International Consultants The detailed TOR for the International consultants are:

1. Team Leader/ Resident Engineer – 30 Person Months Detailed Tasks:

(i) Assess the current condition of the road and study the existing resign documents. Study the region of the road etc.

(ii) Conduct all necessary engineering surveys for the project road. (iii) Develop preliminary design for (a) horizontal and vertical alignments, (b)

drainage protection structures, and (c) pavement design. Review locations of culverts, grade-crossing, and underpasses. Recommend appropriate soil treatment and slope protection measures.

(iv) Review the demand for overall road transport, particularly considering potential trade with, and transit movement from/to, surrounding countries, and develop a freight traffic forecast by commodity and a passenger traffic forecast by passenger profile for program roads for 20 year timeframe both for “without-project” case and for “with-project” case.

(v) Review demand for transport of goods by the road based on origin-destination data and existing traffic forecast by commodity. Review demand for passenger traffic based on an origin-destination survey. Subdivide forecast of freight and passengers into categories to show the source of the traffic and enable the benefits of the road and modal competition to be estimated. Subdivide forecast into traffic diverted from rail, traffic diverted from other modes, and traffic generated. The traffic forecast should cover 20 years from the start of project operation.

(vi) Estimate project benefits that will be accrued in the form of vehicle operating cost and time savings, and will be realized through any other development impacts such as revenue generation or promotion of industries.

(vii) Develop an indicative procurement plan for an ensuing project with suggested level of prior or, if applicable, post review based on MOTC capacity.

(viii) Prepare bill of quantities, unit prices, overall project cost estimates, and cost estimates using the existing detailed designs and other similar projects for (a) civil works for road construction (taking into account the actual costs of recently awarded contracts of a similar nature), (b) equipment and other facilities to be procured under the project, and (c) routine and periodic maintenance for the project roads during its economic life. Estimated costs should include the costs of environmental mitigation measures and monitoring, land acquisition, and

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resettlement and be categorized by foreign and local cost with relevant taxes and duties identified separately

(ix) Prepare a list of contract packages with estimated contract value and recommendable mode of procurement following ADB’s Procurement Guidelines.

(x) Assess the options on implementation arrangements and organizational setup for project management and maintaining project accounts. Prepare an implementation schedule and schedule for disbursement of loan and counterpart funds taking into account all major activities, logistics of procurement, and seasonal aspects.

(xi) Prepare routine and periodic maintenance plan for the project road during their economic life.

(xii) Assess the need for consultant input for construction supervision of the Project, and develop terms of reference for the consultancy.

(xiii) Prepare a design and monitoring framework that outlines the impact, outcome, outputs, and activities and inputs under the project, following ADB’s staff instructions on the use of logical frameworks for ADB-assisted loans and TA.

(xiv) Based on the updated improvement options and costs, prepare detailed cost estimates based on the recent market prices for construction inputs.

(xv) Suggest local inflation factors for major construction materials. (xvi) Provide technical justification for the proposed improvement options in

discussions with the EA and Government agencies. (xvii) Facilitate and take part in project stakeholders consultation process. (xviii) Finalize alternative improvement options, consult and coordinate with safeguard

specialist to include necessary components and costs in overall cost estimates. (xix) maintain records and advise the EA with the day-to-day coordination and

supervision of civil works construction, including the preparation of regular progress reports.

(xx) coordinate and review updated designs and cost estimates prepared by the design consultants.

(xxi) coordinate and supervise the work of field teams in supervising and certifying construction in accordance with contract conditions. He/she shall be familiar with various international standards for design and construction (FIDIC) including stage of works and method of construction such as temporary works, construction plans, schedules, construction method, assignments of equipment and personnel, testing and trials, and drawings

3. Quality and Material Engineer – 20 Person Months Scope of Work: The material engineer shall ensure that the quality of all the materials used comply with the specifications and construction drawings. Detailed Tasks: The material engineer shall hold a bachelor degree in civil engineering, be proficient in both written and spoken English and have a minimum of 12 years experience in major road construction works especially in material testing. He/She will

(i) advise the chief resident engineer on the contractors' compliance to material specifications and testing,

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(ii) provide input to the design team, and (iii) coordinate and supervise the work of field teams in supervising and certifying construction in accordance with contract conditions including acceptance standards of materials, approval of source supply, and material testing methods.

4. Pavement Engineer – 30 Person Months Detailed Tasks: BE with 15 Years experience, preferably Post Graduation in Highway/Geotechnical/Materials. 3 years of Flexible pavement experience in international projects. Experience in review of flexible pavement designs, establishing QA/QC procedures, setting up laboratories, mix designs and testing procedures. He/she will

(i) review the pavement design, advise the chief resident engineer on the material quality and specifications, asphalt mixing methodology, safety protection, laboratory and-field material tests for quality control and field equipment

(ii) advise the field teams in the using of asphalt concrete and certifying construction in accordance with contract conditions.

(iii) maintain records and assist the EA wih the day-to-day coordination and construction supervision; coordinate and review updated designs and cost estimates prepared by the design consultants, and coordinate and supervise the work of field teams in supervising and certifying construction in accordance with contract conditions.

5. Contract Specialist – 12 Person Months Detailed Tasks: Contract Specialist: Qualified Contract specialist with 15 yrs relevant experience with specialization in contract management of funded by Asian Development Bank or World Bank. 2 years of International as contract specialist in International Competitive Bidding. Should have handled arbitration cases of any project involving FIDIC. Experience of handling variation orders, claims and their disposal.

(i) Assist EA in the Procurement of Works (including but not limited to preparation of bidding documents, prequalification documents, evaluations of prequalification documents, bid evaluations, award and contract documents)

(ii) Assist EA in the procurement of services (including but not limited to prequalification/short listing, preparation of Request for Proposal (RFP’s), TOR’s Technical and Financial Evaluations and contract documents.

(iii) Streamline EA procurement procedures and review/revise existing Standard Operating Procedure to include processes in accordance with PEC/ADB/World Bank/other donor agencies guidelines.

(iv) Check contractor’s policies and guarantees to ensure that they comply with contract requirement.

(v) Review contract administration of contracts. (vi) Assist in contractual interpretation and evaluation of claim by the contractors. (vii) And any other assignment as and when assigned by General Manager (P&CA).

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6. Environment Specialist – 2 Person Months

Detailed Tasks: A bachelor degree in environment sciences, be proficient in both written and spoken English and preferably with a minimum of 8 years experience in civil works project implementation, and monitoring of environment safeguards. He/she should be preferably familiar with ADB environment guidelines.

(i) Manage and coordinate the preparation, updating, implementation and monitoring the IEE/EIA as required by the FFA and loan agreement.

(ii) Set up internal monitoring system on the project’s environmental issues and requirements

(iii) Project Information Management and Development (iv) Assess and prepare capacity building program on environmental issues (v) Conduct internal and external coordination with relevant parties in environment

requirements of the project. (vi) Report preparation and submission (vii) Provide advice/ recommendation to the EA on environment problems and/or

requirements (viii) Provide independent monitoring on the contractors' compliance to environmental

management plan. 7. Social Development Specialist – 3 Person Months

Detailed Tasks: Minimum Bachelor degree in social development with minimum 5 years experience in project implementation, and monitoring of social safeguards including resettlement issues. He/she should be preferably familiar with ADB social safeguard guidelines.

(i) Manage and coordinate the preparation, updating, implementation and monitoring the approved Land Acquisition and Resettlement Plan (LARP/s) and/ or Ethnic Minority Development Plan (EMDP/s), if any, as required by the FFA and loan agreement.

(ii) Set up internal monitoring system on the project’s social and resettlement issues and requirements

(iii) Select and review an External Monitoring Agency (EMA) to be approved by the Program's Director.

(iv) Project Information Management and Development (v) Assess and prepare capacity building program on social issues (vi) Conduct internal and external coordination with relevant parties in

social/resettlement activities/ requirements of the project. (vii) Set up redress and grievance mechanism for project activities (viii) Report preparation and submission (ix) Provide advice/ recommendation to the EA on social safeguard/ resettlement

problems/requirements (x) Redress or follow up actions based on findings and requirements of EMA reports (xi) Provide independent monitoring on the contractors' compliance to (a) core labor

standards, labor laws and incorporate applicable workplace occupational safety norms; (b) no differentiation of payment between men and women for work of

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equal value; (c) no child labor in the construction and maintenance activities; (d) no forced or compulsory labor; (e) discrimination in respect of employment; (f) freedom of association; (g) to the extent possible, maximize employment of local poor and disadvantaged persons for project construction purposes, provided that the requirements for job and efficiency are adequately met; and (h) land acquisition and resettlement framework and plans.

(xii) Engage with relevant civil society organizations interested in the project implementation.

8. Road Safety Engineer – 6 Person Months

Detailed Tasks: To prepare the Road safety implementation plan. The road safety specialist will have the following responsibilities:

(i) Prepare and submit a road safety plan for the entire project. (ii) Provide intermittent inputs and presentations as agreed on with the Program

Manager during national and regional workshops and pre- and post-workshop activities on safety.

(iii) Help the team leader devise monitoring indicators to assess, and report to the national government and the ASEAN Secretariat on, progress in implementing the major components of the priority action plan.

F. National Consultants 1. Assistant Resident Engineer He/she will assist chief resident engineer (CRE) on coordination and supervision the road construction works in the field including coordination and liaison with Employer. The Assistant Resident Engineer shall have a bachelor degree in civil engineering, be proficient in both written and spoken English and with a minimum of 12 years experience in road construction. He/she will assist CRE in day-to-day construction supervision, monitoring schedule, preparing monthly certificates, reviewing and approving shop drawings and as-built-drawings. 2. Quality and Material Engineer Under the guidance of the international material engineer, he/she will undertake day-to-day supervision of compliance to material specifications and testing, supervise the contractors work, and certify the construction in accordance with contract conditions including acceptance standards of materials, approval of source supply, and material testing methods. The material engineer shall have a bachelor degree in civil engineering, be proficient in both written and spoken English and with a minimum of 8 years experience in major road construction works especially in material testing. 3. Quantity Surveyor The quantity surveyor, a civil engineer proficient in both written and spoken English and with minimum 10 years experience in supervision of major road projects, will assist Highway

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Engineer in daily supervision, check the quantity, variations, justification and verify the monthly certificates. 4. Site Inspector The site inspectors shall have a bachelor degree in civil engineering, be proficient in both written and spoken English and with a minimum of 8 years experience in major road construction works especially in workmanship and construction method. Under the guidance of the international highway engineer, they will undertake day-to-day supervision for roads and small structures, monitor contractors' work and certify the construction in accordance with contract conditions. 5. Road Safety Engineer He or she should be an experienced traffic engineer with a university degree or equivalent professional qualification and should have a minimum of 10 years experience of traffic analysis and forecasting and road safety analysis during and after construction works, and working on similar traffic or road safety improvement assignments.

(i) Implementing remedial schemes including estimating costs, specifying, ordering and for larger schemes briefing agents and consultants and maintaining cost control.

(ii) Carrying out safety audits. 6. Bridge Engineer BE with 15 years experience, preferably Post Graduation in bridge and structure engineering. 10 yrs of Experience in construction bridges, culverts and other structures. 4 major bridges on pile / well foundation and at least 2 large projects in similar capacity. A thorough understanding with international standards and “best practices”, experience of construction of bridges involving design standards, technical specifications, establishing QA/QC procedures, etc.

II. PROGRAM MANAGEMENT CONSULTANTS A. Program Management Consultant Scope of Work Project Management. The Program Management Consultant (PMC) will be responsible for the management of the Investment Program with the following scope of work:

(i) Maintain records and advise and assist Ministry of Transport and Communications (MOTC) with the day-to-day coordination and supervision of the Investment Program and its components, including the preparation of regular progress reports.

(ii) Coordinate and review updated designs and cost estimates prepared by the design consultants.

(iii) Advise MOTC/ Program Director (PD) on the preparation, evaluation, and award of tenders for civil works construction.

(iv) Coordinate and supervise the work of field teams in supervising and certifying construction in accordance with contract conditions.

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(v) Review justifications provided for any variation orders proposed and submitted by the Contractors.

(vi) Monitor contractors’ conformity with environmental and social impact controls required under the Project.

(vii) Develop impact and outcome indicators; collect baseline data; and measure the indicators over time during the assignment period.

(viii) Ensure project financial management procedures are in place and are strictly followed, specifically relating to payments, financial accounting, financial reporting and record keeping.

(ix) Undertake financial audits and draft reports in accordance with the Asian Development Bank (ADB) and the Government.

(x) Review cross-border procedures and recommend how to simplify and harmonize them so that border crossing time is reduced and more efficient

(xi) Assist MOTC to prepare a project completion report at the end of each tranche loan.

(xii) Assist with the evaluation of time and cost claims by the contractor. Procurement Activities. The PMC will be responsible for coordination of procurement of civil works, goods, and consultants under the Investment Program and ensuring that procurement is carried out in compliance with the procedures agreed with ADB. The tasks of the procurement activities will include but not be limited to the following:

(i) Undertake procurement activity in accordance with the draft procurement plan, which provides the estimated costs and basis for the procurement methods for each procurement item under the Project.

(ii) Review technical specifications as developed for procurement of good and services together with MOTC.

(iii) Prepare bidding documents (for the subsequent projects) with the inputs provided by the detailed design consultant.

(iv) Prepare tender notices and invitations for bids (for the subsequent projects). (v) Receive and open tenders, coordinate the evaluation process, validate findings,

and prepare the Evaluation Report. (vi) Administer contracts to ensure compliance with the contract conditions, payment

terms, variations, dispute resolution, and monitoring, etc. (vii) Maintain all records relating to procurement. (viii) Maintain a separate record relating to complaints and their redressing. (ix) Periodically update the procurement plan in agreement with the EA to reflect the

actual project implementation needs and improvements in institutional capacity. (x) Prepare procurement implementation reports in accordance with the reporting

requirement acceptable to ADB. (xi) Assist the MOTC in its procurement activities and help it in developing reports in

the agreed format. (xii) Obtain all necessary clearances within the Government and ADB. (xiii) Keep all procurement records in proper order, acceptable to MOTC and ADB. (xiv) Assist the ADB staff during procurement prior reviews. (xv) Train MOTC staff on procurement.

Project Preparatory for the Subsequent Projects. The MOTC has completed a feasibility study for the 430km Aktau–Manasha. However, feasibility studies for the other sections are yet to be developed. Preliminary environmental impact assessment and basic surveys for land acquisition and resettlement plans were completed by MOTC in July 2010. Economic analysis

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was undertaken in June 2010. This advisory service therefore, will (i) complete due diligence reviews including technical and economic appraisal, environmental, social, and poverty impacts assessment, and (ii) prepare project implementation and financing plan for ADB financing. Detailed Tasks: Task 1: The consultant will carry out due diligence for the key parameters for the subsequent projects (i) traffic forecasts, (ii) review road and support facilities preliminary design and cost estimates, (iii) review detailed design, technical, economic, environmental and social feasibility studies for the subsequent projects. (iv) financing plan, and (v) implementation arrangements and schedule. The consultant’s diligence review will include road safety and environmental mitigation measures review. Task 2: Review and update the capital cost estimates: The consultant will prepare an up to date cost estimate based upon the proposed road development, amended to take account of current prices, the most appropriate exchange rate and any amendment to facility design and phasing. Task 3: Update the economic analysis. The economic analysis for the subsequent projects was completed. The consultant will review the latest traffic data, the latest economic data and all other relevant data and information which will allow updating of the traffic forecasts as necessary. Based on the revised capital costs and phasing the consultant will update the economic analysis of the project. The consultant should carefully appraise the methodology used and identify any need to refine the methodology. Task 4: The consultant shall review the environmental assessment report(s) prepared by the road design organizations with a state license in environmental services. Ascertain their conformity with ADB’s Safeguard Policy Statement (2009), and identify any gaps, such as public consultations, environmental management plan, and/or cost estimate of environmental monitoring and mitigation, etc in the reports. The consultant shall endeavor to fill the gaps identified and work with the executing agency to generate required additional work if any, to complete the analysis. The consultant should verify its validity based on the Government’s environmental assessment regulations. The consultant shall complete an IEE in accordance with the requirements of ADB’s SPS 2009. Task 5: Review of social and poverty analyses. The consultant should review the methodology and conclusions of the social and poverty analyses to verify that they were undertaken in accordance with the ADB Guidelines. The consultant should verify gaps if any in the analyses and propose additional work to be carried out by the consultant. Task 6: Conduct additional desk/field investigations, if required, for the Poverty and Social Analysis (PSA) and prepare a PSA report meeting the requirements of the ADB Handbook on Poverty and Social Analysis. The PSA will also identify (i) poverty issues related to livelihood, trade, and transport patterns in project areas; and (ii) complementary physical/non-physical interventions that may, if included in the Project, add to its poverty reduction potential. Lastly, the PSA will provide a social assessment. Task 7: Review the Land Acquisition and Resettlement Plans (LARPs) prepared during detailed design works. If not available, in conjunction with the Detailed Design, determine any possible need for temporary and permanent land acquisition and compensation/resettlement arrangements; prepare LARPs as required, according to the format and scope required by the ADB. Resettlement documents should be prepared in accordance with, and reflect, existing

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local land transfer mechanisms and locally relevant grievance redress mechanisms, as well as ADB's Involuntary Resettlement Policy. The consultant may use the Handbook on Resettlement: A Guide to Good Practice (1998) as a guide. Attention will have to be put in carrying out effective social assessment for the project and if necessary the appropriate modifications to standard LARP approaches will have to be made in case the local land property systems are based on collective ownership principles. Task 8: Prepare contract package, procurement plan, and a detailed implementation schedule for the subsequent projects. Task 9: Assist the EA preparing Periodic Financing Request (PFR) for the subsequent projects in accordance with a format agreed with ADB.

Other Tasks related to the Investment Program:

Task 1: Financial audits. The obligation remains on the auditor to determine the nature and extent of audit evidence required in order to form an audit opinion. For audits to be conducted in accordance with International Standards on Auditing, evidentiary requirements are as stipulated in the standards. Detailed terms of reference, including specific audit procedures to be followed, should clearly indicate that the audit “should include but not be limited to” the prescribed procedures. Furthermore, the detailed terms of reference should be limited to those cases where the ADB and/or EA have concerns with respect to audit capacity.

Task 2: Facilitation of border crossing. Review cross-border procedures and recommend how to simplify and harmonize them so that border crossing time is reduced and more efficient

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B. Road Asset Management Consultants Scope of Work: Consultant services will be provided to lay the foundations for a Road Asset Management System (RAMS). Designing a RAMS for the entire network - formatting a database for data collection, defining adequate service levels, interaction with stakeholders, valuation of assets, and testing and calibrating a decision model and preparation of guidelines for the maintenance of the system and training. Detailed Tasks:

(i) Review of current regime of road user charges. The review will focus on the resource requirement in relation to the sources of road financing. The expected result of the assessment will be recommendations for a road user charge tariff that is better aligned to the damage and the respective cost inflicted by the various groups of road users on the road pavement. The assessment will be aimed at separating road user taxes and fees from general taxation. Based on this, the excess of revenues from road user charges over the proceeds allocated to the general budget will be determined and their adequacy to close the financing gap examined.

(ii) Review of current expenditure practices. Current expenditure practices will be examined with regard to the allocation of resources to the main road expenditure categories and the compliance of the allocation with prescribed rules and criteria; In this context, contract management practices and procedures will be reviewed and the cost efficiency of work carried out examined. The task will result in realistic proposals for achieving economies. Based on a quantification of the findings, the current and anticipated resource gaps should be revised.

(iii) Review the current contract management practice and establish procedures for quality control consistent with the FIDIC terms of contracts. Improve routine maintenance contracts with a view to expanding the application of performance based contracts.

(iv) Creation of a data base to serve as an asset register. Select or design a format for a data base that is compatible with the used of HDM IV. Determine a list of asset types to be included in the RAMS. Prepare a user manual for data collection and systems application. If so needed, design a format for fresh data collection. Assist in the procurement of equipment needed for data collection, notably traffic counting equipment and GPS equipment. Start valuation of the assets included in the RAMS and provide staff training and organize study tours to countries that have successfully implemented RAMS. Prepare long-term program for the countrywide application of the RAMS including.

(v) Review of the institutional setting. Determine the most suitable location and institution to become the road asset manager and recommend appropriate institutional and organizational arrangements.

(vi) Develop cement concrete road maintenance guidelines. Prepare guidelines for (a) cement concrete pavement surveys and investigations, (b) technical specifications for maintenance of cement concrete roads, (c) road maintenance works and equipment, and (d) capacity building and training.

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C. Financial Management Specialist Scope of Work: Assist MOTC, as necessary, to strengthen financial management of projects. Detailed Tasks:

(i) Review the present financial management system of road projects adopted by MiOTC and asses its adequacy in terms of compliance with either government’s fiscal accounting requirements or commercial accounting standards.

(ii) Review/redesign the financial accounting policies for financial accounting and for preparation of financial statements.

(iii) Review/strengthen the Financial Management Manuals for financial management, financial accounting, budgetary control, information systems and disbursement management with a view to inculcate fair accounting and financial management practices project administration.

(iv) Contract Management - review of contracts and various financial covenants of contract documents, bank guarantees, insurance policies, etc.

(v) Disbursements - review monthly payment certificates/invoices for disbursements of the eligible payments to the contractors/consultants, review of withdrawal applications, etc;

(vi) Financial accounting – recording of financial transactions that include maintenance of various registers of expenditure, control registers, fixed assets register, cash book & imprest account, bank guarantee register, etc;

(vii) Preparation of annual budgets and carry out budgetary control exercise; and Maintenance of adequate records and books of accounts for the projects financed out of loan/grant;

(viii) Compliance with account procedures in accordance with the ADB’s Loan Disbursement Handbook; and preparation & submission of annual audited project accounts (APAs)

(ix) Review and apply internal audit procedures and standards and prepare audit manuals that spell out processes and procedures to conduct regular financial audit of the airport projects. The audit manuals will provide formats of audit report to be prepared as a result of internal audit.

(x) Assess the requirements for computer equipment and computerized financial accounting & information systems software needed to adopt the financial management system and recommend additional facilities as necessary.

(xi) Participate in the procurement of civil works and consultants, as and when required.

(xii) Provide on-the-job trainings to the staff in all the above areas including computerized financial accounting and financial information system.

D. Procurement Specialist Scope of Work: The procurement specialist will be responsible for procurement advance actions to complete for readiness of the Project, as well as procurement on project level and shared activities, and ensuring that procurement is carried out in compliance and in accordance with the procedures agreed with the Asian Development Bank (ADB).

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Detailed Tasks:

(i) Prepare request for proposal (RFP) documents, following the draft procurement plan (per the steps and estimated durations laid by ADB); which provides the estimated costs and activities for each procurement methods and for each procurement item under the Project;

(ii) Prepare technical specifications for procurement of good and services in consultation with the EA;

(iii) Prepare prequalification documents, specifications and bidding documents, following ADB’s Standard Bidding Documents;

(iv) Prepare tender notices and invitations for bids; (v) Receive, open, and assist in evaluation of bids; and finalize contracts; (vi) Periodically update the procurement plan in agreement with the EA to reflect the

actual project implementation needs and improvements in institutional capacity; (vii) Assist in getting any documents translated and printed; (viii) Prepare procurement implementation reports as necessary and in accordance

with the reporting requirement acceptable to ADB; (ix) Obtain all necessary clearances within the Government and ADB; (x) Maintain all procurement records in proper order, acceptable to the EA and ADB; (xi) Assist in getting any documents translated and printed; (xii) Assist the ADB staff during procurement prior-reviews; (xiii) Contribute to the preparation of loan/project documents, references, studies, and

materials for ADB and the EA on procurement aspects; (xiv) Consult with the concerned officials of the Executing Agency (Ministry of

Transport and Communications, and Committee of Roads) for coordination and any information required to complete the tasks;

(xv) Train EA staff on procurement aspects following ADB Guidelines. (xvi) Prepare procurement implementation reports as necessary and in accordance

with the reporting requirement acceptable to ADB (xvii) Maintain all procurement records in proper order, acceptable to the EA and ADB (xviii) If so required by the employer, the procurement specialist will provide any of the

following as additional services: (i) prepare reports, additional contract documentation, and/or review and comment on the contractor’s proposals, as may be required for the successful completion of the Project; and (ii) provide any other specialist services as may be required from time to time.

(xix) The employer will authorize all additional services, other than minor extras that do not materially affect the scope of the procurement work, at the rates mutually agreed upon when the services require the use of specialists not listed in the contract.

E. Cross Border Agreement Specialist Scope of Work: At the Sixth Transport Sector Coordinating Committee (TSCC) Meeting on Central Asia Regional Economic Cooperation (CAREC) in August 2006, CAREC countries endorsed the Action Plan (the action plan) for Harmonizing Regional Transport Regulations and Cross-Border Agreements after incorporating the comments and suggestions made during the meeting. The action plan, developed based on a study funded by ADB in 2005 and first presented at the Fifth TSCC Meeting in March 2006, started implementation in 2006. A consultant will be required to

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review initial implementation of the action plan. The consultant should have expertise and experience in regional transport cooperation and cross-border transport and trade facilitation. Detailed Tasks:

(i) Review CAREC countries’ progress in implementing the action plan particularly activities for 2006 and the possibility of implementing activities for 2007.

(ii) Identify constraints in carrying out the action plan and recommend measures to address the constraints and assess feasible timing for implementation of actions which are likely to be delayed due to the constraints.

(iii) Recommend necessary adjustments to the action plan, based on the assessment of implementation and constraints.

(iv) Identify a few parameters for each key result and prepare monitoring framework to assess the progress of implementation of the action plan regularly and systematically.

(v) Finalize a study report on the assessment of the implementation of the action plan.

(vi) Prepare a PowerPoint presentation summarizing the findings and recommendations.

F. Transport Regulatory/Legal Specialist Scope of Work: . Cross-border and transit traffic in the CAREC region, including that along this Corridor, takes places in a number of bilateral and multilateral agreements and conventions, some of which are under preparation. Detailed Tasks: Consistent with relevant legal, regulatory, and policy requirements and international best practice, and in consultation with all concerned parties, the Consultant will prepare the CBA, including the necessary cross references, appendixes, and protocols to the CBA. G. Transport Facilitation Specialist Scope of Work: Cross-border and transit traffic in the CAREC region, including that along this Corridor, takes places in a number of bilateral and multilateral agreements and conventions, some of which are under preparation. Detailed Tasks: Together with a Transport Regulatory/Legal Specialist that will be engaged, the Consultant’s tasks will include, but will not be limited to, the following:

(i) Review existing agreements involving Kasakstan, Uzbekistan, and Turkmenistan and other relevant cross-border agreements (e.g., Almaty-Bishkek cross-border agreement and GMS Cross-Border Transport Corridor Agreement);

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(ii) Draft the initial text of the CBA that covers the following: facilitation of border crossing formalities, cross-border movement of people and goods, requirements for admittance of road vehicles, exchange of commercial traffic rights, infrastructure requirements, institutional arrangements, and miscellaneous and final provisions;

(iii) Participate in the initial consultations with the governments and in the bilateral meetings between the two governments to discuss and negotiate the provisions of the CBA;

(iv) Finalize the draft CBA acceptable with the governments and ADB. (v) Perform other tasks relevant to this assignment, as requested by MOTC.

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Attachment 3

LAND ACQUISITION AND RESETTLEMENT MONITORING AND EVALUATION INDICATORS

A. Internal Monitoring and Evaluation Indicators Purpose Activities Monitoring Indicators

Checking the list of compensation recipients against eligibility criteria for compensations

Number of persons in the list of compensation recipients, who do not meet eligibility criteria (mistaken inclusion)

Identification of compensation recipients

Identification of persons, who may claim eligibility to compensation, but are not included in the lists of compensation recipients. Separate check should be performed on each type of compensation

Number of persons who meet the criteria, but are not included in the list of compensation recipients (mistaken exclusion)

Area of land subjected to temporary acquisition, for which compensations have been paid

Controlling types of compensation

Confirmation of temporarily or permanently affected areas against the LARP

Area of land subjected to permanent acquisition, to which compensations have been paid

Examination of financial documents Number of persons who received compensation in time and in full amount, disaggregated by compensation types Number of persons who did not receive compensation in time and in full amount, disaggregated by compensation types.

Identification and analysis of reasons for compensations not being paid in full amount and in time.

Amount of funding allocated for payment of compensations.

Controlling compensation

Identification of reasons for which funds for compensations have been under/overspent

Rate of spending of funds allocated for compensations, % of amount envisaged in the LARP Number of persons on whose plots temporary acquisition needs to be extended

Additional compensation

Monitoring time limits of temporary land acquisition

Area on which construction works will be continued after the established deadline.

Household impact (income restoration)

Follow up socio-economic survey of affected households (3 months after implementation of LARP)

Changes in household income/livelihood

Determining the level of involvement and identification of reasons of inadequate participation

Number of compensation recipients who participated in consultations and coordination meetings at each stage of land acquisition Number of complaints

Consultation and participation

Analysis of disputes and complaints content. Resolution of conflicts Number of complaints resolved

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B. External Resettlement Monitoring and Evaluation Indicators Monitoring Indicators

Basis for Indicators

Location Composition and structure, age, educational and skill levels Gender of the household head Ethnic group Access to health, education, utilities and other social services Housing type Land and other resource owning and using patterns Occupations and employment patterns Income sources and levels Agricultural production data (for rural households) Participation in neighborhood or community groups Access to cultural sites and events

Basic Information on the APs

Value of all assets forming entitlements and resettlement entitlements Were house compensation payments made free of depreciation, fees or transfer costs to the AP? Have APs adopted the housing options developed? Have perceptions of “community” been restored?

Restoration of living standards

Have APs achieved replacement of key social and cultural elements? Were compensation payments sufficient to replace lost assets? Was sufficient replacement land available of suitable standard? Did transfer and relocation payments cover these costs? Did income substitution allow for re-establishment of enterprises and production? Have enterprises affected received sufficient assistance to re-establish themselves? Have vulnerable groups been provided income-earning opportunities? Are these effective and sustainable?

Restoration of livelihoods

Do jobs provided restore pre-project income levels and living standards? How much do APs know about resettlement procedures and entitlements? Do APs know their entitlements? Do they know if these have been met? How do APs assess the extent to which their own living standards and livelihoods have been restored?

Levels of AP Satisfaction

How much do APs know about grievance procedures and conflict resolution procedures? Were the APs and their assets correctly enumerated? Did any land speculators assisted? Was the time frame and budget sufficient to meet the objectives? Were entitlements too generous? Were vulnerable groups identified and assisted?

Effectiveness of Resettlement Planning

How did resettlement implementers deal with unforeseen problems? Have all land acquisition and resettlement staff been appointed and mobilized for the field and office work on schedule? Have capacity building and training activities been completed on schedule? Are resettlement implementation activities being achieved against agreed implementation plan? Are funds for resettlement being allocated to concerned units/agencies on time?

Budget and Time Frame

Did agencies/units involved in the land acquisition/LARP implementation receive the scheduled funds?

44

Monitoring Indicators


Have funds been disbursed according to the LARP? Has the social preparation phase taken place as scheduled? Has all land been acquired and occupied in time for subproject implementation? Have all APs received entitlements according to numbers and categories of loss set out in the entitlement matrix? Have APs received payments on time? Have APs who experienced temporarily loss of land been compensated? Have all APs received the agreed transport costs, relocation costs, income substitution support and any resettlement allowances, according to schedule? Have all replacement land plots (if available and provided in the LARP) or contracts been provided? Was the land developed as specified? Are there measures to provide secure tenure (titles) to APs, if applicable and provided in the LARP? How many AP households have received secure tenure (titles), if applicable and provided in the LARP? Does house quality meet the standards agreed, if applicable and provided in the LARP? Have relocation sites, if applicable and provided in the LARP, been selected and developed as per agreed standards? Are the APs occupying the new houses, if applicable and provided in the LARP? Are assistance measures being implemented as planned for host communities? (If applicable and provided in the LARP). Is restoration proceeding for social infrastructure and services as provided in the LARP? Are APs able to access schools, health services, cultural sites and activities as provided in the LARP? Are income and livelihood restoration activities being implemented as set out in the income restoration plan, for example utilizing replacement land, commencement of production, numbers of APs trained and provided with jobs, micro-credit disbursed, number of income generating activities assisted as provided in the LARP? Have affected businesses received entitlements including transfer and payments for net losses resulting from lost business and stoppage of production as provided in the LARP?

Delivery of AP Entitlements

Are there APs who were not included in the LARP and were measures made to compensate for the impacts? Were these measures sufficient to replace losses/restore livelihoods?

Gender Impacts Were measures done to identify differential impacts/benefits on men and women APs and were measures done to address these? Were these measures effective in addressing the issue? Have consultations taken place as scheduled including meetings, groups, community activities? Have resettlement leaflets been prepared and distributed? Were men and women equally able to participate in these meetings/consultations? How many APs know their entitlements? How many know if they have been received? Did the APs contributing land/asset do so in their own free will and without pressure, intimidation or deceit? Have any APs used the grievance redress procedures? What were the outcomes?

Consultation, Grievance and Special Issues

Have conflicts been resolved?

45

Monitoring Indicators


Was the social preparation phase implemented? Were special measures for indigenous peoples implemented (if relevant)? What changes have occurred in patterns of occupation, production and resource use compared to pre-subproject situation? What changes have occurred in income and expenditure patterns compared to pre-subproject situation? What have been the changes in cost of living compared to pre-subproject situation? Have APs incomes kept pace with these changes? What changes have taken place in key social and cultural parameters relating to living standards?

Benefit Monitoring

What changes have occurred for vulnerable groups? What changes occurred for women APs? Were there unintended environmental impacts? Other Impacts Were there unintended impacts on employment or incomes?

AP = affected people, LARP = land and resettlement plan.

46

Attachment 4

ENVIRONMENTAL MANAGEMENT PLAN

A.1 PRE-CONSTRUCTION (DESIGN) PHASE

Responsibility Environmental

Impact/Issue Mitigation Measures Location Time Frame

Implementation SupervisionCosts / Budget

A.1.1 Bid documents prepared without access to or use of the IEE and particularly this EMP in a translated version

No bid documents will be prepared without the authors having incorporated a (Russian) copy of the mitigation and monitoring plan EMP, which shall be included in the safeguard clauses of the Technical Specifications in the contracts.

Aktau, availability of documents at RC

Before bid documents are completed

Detailed Design Consultant and RC

MOTC and PMU with advice from MOET

included in the Project Costs

A.1.2 Site selection for large construction camps, near or within existing settlements. Impact on public health and sociological setting

Proper site selection, observing criteria which primarily protect the public general. Observe a minimum distance (buffer zone) between camp site and nearest residential area. Construction camps should not be located within the boundaries of existing or proposed specially protected areas. Observe local wind conditions to reduce nuisances. Work safety and environmental protection measures to be specified by the Contractor in a Site Management Plan (CEAP). Planning for independent water and electric supply network and a medical service station at the site.

At selected camp site locations, wherever these are in close vicinity to settlements or protected areas

at early design stage

Designer

MOTC and RC


A.1.3 Road Accidents with livestock animals and collision risks

Planning for suitable protective measures, as 1. Pre-consult with local people, to identify spots where mitigative measures are needed 2. Plan for animal (under-)passages, sufficiently dimensioned, taking into account specific behavioural aspects to allow safe use by different livestock

At pre-selected locations following consultations with local shepherds

Before the bid documents are completed

Detailed Design team – following field inspection and stakeholder consultation, and in consultation with the Environmental Department

MOTC and MOET, and CHF

Fence, to be included in the Project Costs / Civil Works

47

Responsibility Environmental Impact/Issue

Mitigation Measures Location Time FrameImplementation Supervision

Costs / Budget

species 3. Plan for strong animal fences along min. 200 m each side of an animal passage 4. Provide adequate length and strength of animal fences along the two established /planned protected areas

Units in Aktau Environm.Budget 3.2, 3.3 and 3.4

A.1.4 Significant littering and illegal dumping of waste material

Planning for adequate countermeasures to contain the occurrence and continuation of such spots, by 1. re-designing/removal of roadside bays where littering and waste dumping occurs 2. fencing off the road shoulder to render illegal dumping of waste material impossible, especially at sites where deep slopes and canyons border the road shoulder 3. increase patrolling at those sites, and in case of trespassing, exert strict law enforcement and penalties; 4. the (part-time) installation of video cameras at those sites may be considered to identify violators 5. provision of adequate type and number (20) garbage bins at selected sites along the road.

At all sites where illegal dumping occurs along the entire road sections

1. During pre-design phase 2. as above 3+4.conti-nual 5. before any bridge building tasks place

1. Detailed Design team – field inspection 2. Detailed Design team in consultation with CFH to prepare tree removal and replanting 3. Traffic Police 4. Traffic Police 5. Detailed De-sign Team with help of ecologi-cal expertise

MOTC / RC Traffic Police MOTC / RC

Project Costs / Civil Works Environm.Budget 2.1, 2.2, 2.3. and 3.2, 3.3, 3.4 Traffic Police own Budget Environm.Budget 1.3 and 3.2 Project Costs /

A.1.5. Use of contaminated soil: Failure to carry out a roadside soil testing program to establish possible lead contamination of material to be re-used.

MOTC in cooperation with the SES of the Ministry of Health need undertake a roadside soil sampling program for potential lead and chromium contamination, establish the distance from the pavement edge and depth of dangerous concentrations including a treatment plan and map of locations and

At all locations where roadside material will be re-used. Testing must take place on

During the detailed design stage

MOTC and SES of Ministry of Health

MOTC and RC

to be included in the Project Costs / Civil Works

48


Mitigation Measures Location Time FrameImplementation Supervision

Costs / Budget

depths. In case soil tests indicate lead contamination higher than permissive level, safe excavation and deposit of spoils need to be arranged. As applicable, safe ultimate deposits for contaminated soils must be arranged. Testing of products such as milk and food items

both sides of the road, and to specified depths.

Environm.Budget 1.1 and 1.2

A.2 CONSTRUCTION PHASE

Responsibility Environmental

Impact/Issue Mitigation Measures Location Time Frame

Implementation Supervision Costs / Budget

A. 2.1 Grievances

Officials in charge of people’s grievance will be represented by Contractor, Construction Supervision Consultant, PMU, Local administrations with the support of NGOs. A leaflet outlining environmental protection measures and listing grievance contact points will be distributed. NGOs will be involved in identification, and resolution of people’s grievances

In Shetpe, Beineu, Jarmysh, Sai-Utes

Prior to the start of the construction work.

Association of NGOs “Azamattyk Kuryltai, Contractor, Construction Supervision Engineer, PMU

MOTC NGOs budget $ 30,000

A. 2.2 Contractor fails to retain a ecological expert to prepare the CEAP and to implement all mitigation and monitoring measures as

As specified by law, contractor will be required to employ a licensed expert to prepare the CEAP and obtain all relevant permits. The contractor will not be permitted to mobilize workers without an approved CEAP and the appropriate permits in place.

Entire contract section for which the CEAP will be prepared

Prior to the start of the construction work.

Contractor MOTC and PMU, Environmental Supervision Engineer

to be included in the Project Costs

49


Mitigation Measures Location Time Frame Implementation Supervision

Costs / Budget

specified in the EMP A.2.3 Common issues related to operation of construction camp sites (environmental, social, security, public health, workers safety, sanitary, and waste concerns), see also issue A 2.18.

The contractor will be required to employ a licensed expert to prepare the CEAP who will address all potential impacts identified in the IEE. Focal aspects are medical care, insurances, social welfare, work safety, good housekeeping practices, work hours, security, crime prevention, electricity and water supply, waste management, awareness training, grievance relief.

- as above - - as above - Contractor MOTC and PMU, Environmental Supervision Engineer


A.2.4 Large water extraction volumes for construction purposes and camps may lead to conflicts with local water users

Contractor/sub-Contractors must submit a plan for type, location and quantity of both drinking and technical water extraction. The plan needs to be approved and monitored by the responsible authorities.

At all locations where groundwater extraction is planned

Throughout construction works.

Contractor (and all sub-contractors)

Local Water Authorities, RE, Environmental Supervision Engineer


A.2.5 Sourcing of Materials; Side borrow operations leading possibly to erosion, landslide and landscape deterioration. Impacts associated with stockpiling

Materials may only be excavated in authorized borrow pits. Contractors shall develop a borrow pit site management plan to ensure all precautions for avoiding environmental impacts.While not strictly forbidden, the practice of taking fill material from the side of the road, creating a landscape of craters shall not be acceptable unless complete landscaping and erosion control follows. Any such borrow areas should not intrude visually on the road,

At all rehabilitation sections where additional material is required from borrow pits. impact zones requiring special protection include the hauling roads.

Throughout the construction period

Contractor MOTC and PMU, RE, Environmental Supervision Engineer


50



Costs / Budget

meaning it should be out of eyesight from the road with proper site re-contouring and replacement of topsoil. Provide adequate fencing to prevent unauthorized access to borrow sites. Provide for proper decommissioning plan for each borrow site.

A.2.6 Public hindrances due to traffic diversions and hauling routes

Provision of a site-specific traffic diversion management plan, including precautionary measures such as signage, working hours, public awareness, preparation of emergency plans, and proper decommissioning of such temporary roads. Liaison with local railway authorities and hospitals

- as above - Throughout the construction period


to be included in the Project Costs /

A.2.7 Potential Impacts associated with the Asphalt Mixing Plant AMP

Choose operation site for AMP (as for crushers) at least 2 km away from the next human settlement or specially protected areas, and always on leeward side with respect to prevailing winds.

At all construction sites nearby settlements and protected areas


Contractor RE, Environmental Supervision Engineer


A.2.8 Potential Impacts associated with bitumen works

Avoid, all time, contact of bitumen with water and dust; Bitumen and solvents shall not be spilled on ground, ditches or water courses. If this happens, spills need to be removed immediately and disposed in a safe site that is protected from public access. No waste material shall be burned in connection with hot bitumen. All

At all construction sites Throughout the construction period



51



Costs / Budget

manual works while handling bitumen require special protective clothing (shoes and gloves). Bitumen works shall not be carried out in winter, rainy or stormy weather conditions. Trucks used for hauling asphalt mixture shall be adequately equipped. Surfacing works should not occupy more than one single traffic lane at a time.

A.2.9 Potential Impacts associated with concrete works

Avoid concrete works during windy, icy or very hot conditions. Aim at pre-cast solutions. Dust development at site can be managed by suitable covers (canvas) and/or water spraying. While working in streams casting concrete structures utilize cofferdams. Use spray waters for slowly curing and make all precautions to avoid contamination of adjacent surface or groundwater resources. Cover newly cast concrete surface with waterproof sheet material or sand to prevent moisture losses, and accelerate the curing process by using steam or radiant heating. While working with additives (e.g. anti-corrosive mixtures) special care needs to be applied, following the general and specific precaution prescriptions described in the Contractor’s work safety guidelines.

At all construction sites Throughout the construction period



52



Costs / Budget

A.2.10 Improper management of earthworks; transport and storage procedures,; impacts caused by any activity generating dust and air pollution

Large volumes of quarry rock, aggregate and sand will be transported and stored to work site. Hauling roads (dirt roads) need regular water spraying to contain dust development. 1. Ensuring that the contractor’s fleet of vehicles and diesel generators are properly maintained and tuned to prevent excessive TPM pollution; inspection reports are submitted to the RE B.2. Observance and control of specified haul loads; as and if necessary, upgrade the haul roads into all-weather road; 3. Documentation that the Contractor uses specified fuel for his fleet; 4. Use of dust suppressants (regular watering) 5. Vehicle operators must make provisions to cover trucks, particularly during windy conditions. 5. Truck and excavator operators must strictly observe specified speed limits being 30 km/hr near (100 m) or within settlements. 4. Vehicle idling time must not exceed 2 min. All topsoil needs to be collected, stored in appropriate stacks, protected from wind and rain, and be fully re-used to

Anywhere where material is excavated and transported to/from sites of construction


Contractor (being responsible for local sub-contractors)

MOTC and PMU / RE, Environmental Supervision Engineer

to be included in the Project Costs / Civil Works Environm.Budget 1.4

53



Costs / Budget

rehabilitate/revegetate the areas disturbed and as specified by the RE.

A. 2.11 Generation of quarry dust due to drilling and stockpiling operations in quarries

Environmental auditing of the supplier of construction materials in Shetpinskoe mining site to ensure that: (i) the equipment for crushed stone quarrying activities should be fitted with: 1. Enclosure of stockpiles for fine materials 2. Atomizing water sprays for conveyor transfer and discharge points (ii) the dust suppression technologies are operative and efficient

Quarry sites, especially near Shepe (Shetpinskoe)


Contractor (being responsible for local sub-contractors)

MOTC and PMU / RE, Environmental Supervision Engineer

to be included in the Project Costs / Civil Works Environm.Budget 1.4

A.2.12 Modification of surface drainage during culvert and bridge replacement and raising of horizontal road alignment without repair and rehabilitation after construction is finished

1. All construction materials in a channel with flowing water must be removed so as not to provide any obstruction. Culvert removal and replacement will be done during the dry months. B.2. Maximum care is needed to avoid degradation of the river, stream shore and to undertake excessive excavation in the water. Demolition must be done in a way that prevents large junks of material from falling into the river. Stabilization of disturbed crossing banks must take place as part of the construction work and include filter fabric, gabions and preferably bioengineering techniques.

At a bridge site km 374


Contractor MOTC and PMU


54



Costs / Budget

A.2.13 Inadequate handling of lead-contaminated roadside soils

Should the tests during the pre-construction period indicate consistently contaminated soils and these need to be excavated, the contractor must treat these soils as hazardous materials, seek proper disposal permits and get expert advice on how and where to dispose or de-contaminate these soils.

Any road shoulders where excavation is planned

Prior to any road shoulder excavation or clearing where there is risk of soil contamination

Contractor and SEC of the Min of Health as well as MOEP

MOTC and PMU, Environmental Supervision Engineer, SES expertise as applicable


A.2.14 Failure to properly manage petroleum products such as fuel, lubricants and bitumen, leading to spill and contamination.

The Contractor/Sub-contractor will be required to have the following spill prevention measures in place at all work sites: 1. All fuelling to be done on a concrete surface provided with spill catch tank that can be cleaned and all spilled fuel recovered and recycled based on discussions with fuel supplier. B.2. All repair and maintenance work must either be done on a concrete surface with oil spill catch basin or oil catch pans must be provided at all service areas and training provided to all ‘mechanics’. 3. All fuel use areas where spills and leakage is possible, e.g. the generator, must have drip basins installed to pre-vent leakage. All recovered materials must be recycled. 4. A fuelling areas must be equipped with proper fuel nozzles and means for

At all construction sites, and within camps and storage facilities established

Throughout construction works, including decommissioning phase.

Contractor (and all sub-contractors)

MOTC and PMU, RE, Environmental Supervision Engineer


55



Costs / Budget

preventing accidental spills. 5. Bitumen drums must be stored in a dry covered secure place where no leakage to water or ground is possible. Drums must be recycled at least once/yr. 6. Any spills must be cleaned up according to GoK norms and codes within 24 hours of the occurrence, with contaminated soils and water treated according to GoK norms and codes. Records must be handed over without delay to the RE.

A.2.15 Inadequate erosion control and slope stabilization leading to land slip and chronic erosion at cuts and water crossings.

Contractor will be required to know the subsoil materials that are being cut into and excavated and have ready appropriate plans to prevent land slippage and erosion At water crossings where structures are to be replaced careful replacement and use of gabions and bioengineering methods for rapid revegetation and slope stabilization need be considered.

km Throughout the construction period



A.2.16 Noise and vibration impacts, generated by construction activities

Contractor shall take all necessary steps to: 1.Selection of modern and well-serviced equipment and plants with reduced noise level ensured by suitable in-built techniques and appropriate silencing devices; B.2.Confining excessively noisy work and movement of heavy

At all construction sites, especially those located nearby settlements (Shetpe, Jarmysh)



to be included in the Project Costs / Civil Works Environm.

56



Costs / Budget

machinery to specified daytime working hours (this relates especially to stone crushers. percussion hammers and pneumatic drills); 3. Work hours need observe special restrictions near residential and environmentally sensitive areas; 4. Providing the construction workers with suitable hearing protection (ear muffs); 5. Avoid vehicle idling. 6. Timely public announcements of works

Budget 1.5

A.2.17 Failure to adhere to construction related good housekeeping practices, including solid and sanitary waste management

Contractors will adhere to standard good house-keeping practices as defined in the contract Terms & Conditions and Contract Specifications: 1. Management of construction waste and water B.2. Equipment lubricants and fuel, including management and collection of waste oils and fuel particularly related to refuelling depots, maintenance areas and diesel generator sets 3. Sewage will require latrines or chemical toilets with complete clean up after the construction is complete. 4. Garbage will be collected and properly disposed, in accordance with GOK norms and codes 5. The contractor shall orient all construction workers in basic sanitation and health care issues,

All work camps, construction maintenance yards and any other areas operated by the contractor and involved in the project


Contractor (including sub-contractors)

MOTC and PMU


57



Costs / Budget

general health and safety matters, and on the specific hazards of their work and will need to certify to that effect at the start of the construction period. 5. Once the site is no longer needed the contractor must fully decommission it, with emphasis on waste removal /clean up of any spills or hazardous materials plus any necessary revegetation.

A.2.18 Loss of cultural or archaeological heritage, including cemeteries and roadside graves/markers of accident victims

Wherever roadside graves/markers of accident victims are along road sections, grave removal requires a process of consultation with the local Akim as well as the victim’s family to possibly move the grave to another appropriate site. Since all the work is basically in previously disturbed soil the risk of loss of historical or cultural relics is highly unlikely. However when widening roads in villages and towns, contractors will have to meet with local Akims to consult about any possible past relics or foundations of old buildings along the road. Any finds must be reported to the RE, to the Oblast Cultural Heritage Department and all construction work stopped until authorities have issued clearance to go on.

At any gravesites or sites that would indicate archaeological/historical items at construction sites, including newly established hauling roads to quarries.

During the construction period and ahead of excavation at any such site Prior to earth moving in these areas

Contractor (and sub-contractors)

PMU, MOTC and any authority issuing a Cultural Heritage Expertise


A.2.19. Poaching 1. Construction camps should In vicinity to chink areas Prior to Contractor (and PMU, DNRM n/a

58



Costs / Budget

by construction workers can pose threat to wildlife. Transcaspian Urial (Ovis vignei arcal) is one of the major subjects of poaching

not be located in proximity to high biodiversity areas. 2. Prohibition of poaching under terms of employment

near Sai-Utes construction sub-contractors)

A.3 OPERATION PERIOD



Costs / Budget

A.3.1 Concerns related to general traffic safety

Appropriate road signage, traffic monitoring and control, human capacity development, review of the driving license issuing system and a wise application of penalties seem to be the most likely responses. The installation of an early warning electronic and radio system in case of bad road conditions ahead may also considerably contribute to improve the road safety. Evaluate the introduction of publicly accessible, well-marked posts containing both an emergency (pay-free) telephone and a first-aid box with medical supplies, stretchers, bandages and other means for first assistance to road victims. To avoid mis-uses, these boxes shall be equipped with an electronic lock that can only be

Emergency phone posts at identified black spots where regular road accidents occur.

at the start of operations

RC, in collaboration with local Traffic police and local medical services

MOTC and Traffic Police

t.b.d.

59



Costs / Budget

opened by prior telephone contacting to a nearby police station.

A.3.2 Roadside soil and grass contamination due to traffic emissions, leading potentially secondary impacts on roadside grazing domestic animals

Testing of roadside soils, grasses and crops grown within 50m of the carriageway and establish lead and heavy metal concentration levels Strict control and enforcement of the 50m farming restriction zones paralleling the road. Lead levels will be estimated for future traffic conditions and contamination predicted and appropriate action taken, as necessary.

At sites t.b.d, within 50m of the carriageway edges.

t.b.d. RC, in collaboration with the national agencies such as SES, and qualified NGO institutions.

MOTC MOTC

A.3.3 Increased risk of hazardous material spills due to increased traffic volume and provision of larger capacity bridges and stronger road surfaces, inviting large trucks to use the road.

Although the risk is extremely small since most such materials are transported by rail, the road operator will: 1. Insure that all trucks carrying hazardous materials are marked according to GoK norms 2. Enforce traffic controls 3. Set speed limits for trucks carrying hazardous material to max. 85kph or according the GoK norms and codes. 4. Restrict all truck carrying hazardous material from passage through towns and villages where bypasses exist; 5. Assist Mangystau Oblast to prepare a rapid spill response and clean up protocol so that in the event of a spill the appropriate people and

At defined Road Inspection Sites or Checkpoints

Within the first year of the road being in operation

Road Operator, Traffic Police MOTC to arrange for District Contingency Plan

MOTC and MOE

MOTC Environm.Budget 3.1

60



Costs / Budget

equipment are quickly notified and action can be taken.

A.3.4 Potential spread of STDs and human trafficking

Commendable actions to curtail such impacts are: 1. Public awareness campaigns to address risks associated with human trafficking and spread of sexually communicable diseases; B.2. Increased controls on highway sections where human traffickers are reported to operate 3. Seeking assistance of locally operating NGOs.

Along the Aktau – Beineu Road Corridorin Beineu

Continual activity, as required by records of incidences

SES, Traffic Police, Association of NGOs “Azamattyk Kuryltai”

SES SES own budget Environm.Budget 2.2

61

Environmental Management Plan

PART B: Environmental Monitoring

B.1 PRE-CONSTRUCTION (DESIGN) PERIOD

Monitoring Aspect Monitoring Activity / Details / Outputs Timing Executing Unit

Reporting Responsibility

B.1.1 No provision for translation of IEE and related documents for use by Oblast Inspectors, and for use in Bid documents ( at least this EMP)

Confirm that Kazakh/Russian version of IEE and EMP are with the Oblast Inspectors Confirm that bid documents contain environmental clauses tailored to the project conditions as well as a copy of the precautionary measures outlined in this EMP

During Detailed Design Period, at the time of preparing the bid documents

MOTC/ RC MOTC

B.1.2 Failure of designers to include design measures that will prevent later impacts such as: livestock crossing management, poor traffic management

Confirm by reviewing design documents and discussion with design team that 1. livestock crossings in Section 3 have been addressed B.2. a plan to protect roadside trees as much as possible has been prepared; 3.There is step-by-step protocol for traffic management during construction ( as opposed to ad hoc, hap hazard existing system); and 4. an environmentally friendly bridge and culvert replacement guide has been prepared

During Detailed Design Period, at the time of preparing the bid documents

Detailed Design Team under the direction of MOTC/ RC

MOTC

B.1.3 Roadside soil testing program to identify potential levels of lead contamination

Monitor / verify the testing program for both soil samples and local food items. In specific, monitor goat and sheep milk tests and that a management protocol is arranged, together with the SES.

During Detailed Design Period

Specialist Institute contracted by MOTC

MOTC and SES of MOH

B.1.4 Lack of capacity to understand and implement environmental mitigative measures, in particular the compliance monitoring procedure

Collect and review written material and expertise indicating that MOTC has provided instructions for the contractors to use to better use the IEE output Prepare environmental compliance forms together with Contractors and Sub-Contractors to secure acceptance

During Detailed Design Period, at the time of contract awards

Environmen-tal Supervision Engineer MOTC/ RC

MOTC

62

B.2 CONSTRUCTION PERIOD



B.B.2.1 Availability of ecological expertise to prepare the CEAP and to implement all mitigation and monitoring measures with contractor

Confirm ecological expertise is with contractor at start of construction period: check CV and license certificate(s). Discuss with contractors/sub-contractors the management implications of all measures included in EMP.

At time of each contractor appointment

PMU MOTC

B.B.2.2 Lack of good housekeeping practices at both camp sites and work sites, including solid and sanitary waste management

Using agreed monitoring checklists, confirm that the items as listed in the CEAP and in the Technical Specifications are fully implemented.

Throughout construction period, monthly

PMU PMU and MOTC

B.B.2.3 Earthworks and material handling processes, including aggregate sites, haul roads to quarries or processing sites;

Using a checklist confirm the following: 1. haul road upgraded so it becomes an all weather road; B.B.2. speed limit of 30 KMP within 500m of any village and the use of chemical dust suppressants at least on road for 500m on either side of a village is enforced. The same approach is to be taken if the other site is used. 3. Aggregate sites are operating legally and contractors have marked the boundaries, work within them, and fully rehabilitate and stabilize the site as part of decommissioning.

Start of Construction period and thereafter monthly until use of roads/sites is finished.

PMU

PMU and MOTC

B.B.2.4 Side borrow operations leading to erosion, landslide and destruction of landscape

Undertake inspections to determine the type of borrow operations the contractor is applying and ensure that roadside borrowing is not taking place and is always out of the visual field from the road.

Throughout the construction period and monthly

PMU PMU and MOTC

B.B.2.5 Earthworks - transport and storage; managing of dust, noise, drainage during haulage of materials

Undertake, as part of the construction inspection, regular confirmation that earthworks are handled in an environmentally acceptable manner and dust control is undertaken at all time, including the use of tarpaulins by trucks hauling fine materials, as well as watering along the haul road sections passing near/thru villages, and that a speed limit of 30 km/hr is strictly enforced. Haulage through roadside villages and settlements is restricted to between hours of 0730 and 1730..

Every day, throughout the construction period

PMU PMU and MOTC

63



B.B.2.6 Erosion control and slope stabilization to prevent landslip and chronic erosion at cuts and water crossings is being applied.

Undertake regular inspection to confirm that slope stabilization and standard erosion protection method are being used by the contractor for all work where there is clearing of topsoil, cutting and filling.

Every day, throughout the construction period

PMU PMU and MOTC

B.B.2.7 Excavation of roadside lead contaminated soils (see also 1.3)

The excavation of every roadside area needs to be matched with reasonable proof that the materials are not severely contaminated with lead; if contamination exists, verify proper handling, treatment and ultimate disposal of such material

At every excavation activity

PMU PMU and MOTC

B.B.2.8 Potential bitumen/asphalt and concrete production spills and pollution.

Confirm that sighting specification for both asphalt and concrete plants are according to norms and codes but also that are at least as far away from settlement areas as defined in the mitigation table. Bitumen storage and handling is done without spillage

Throughout construction period and monthly

PMU PMU and MOTC

B.B.2.9 Management of petroleum products such as fuel, lubricants and bitumen, without spills and contamination being practiced by contractor and all subcontractors.

Using the monitoring checklist the 8 specific spill and contamination prevention measures listed in item B.B.2.13 of the Mitigation table will be assessed and reported on. Unannounced (spot) inspections at all work sites, work camps. diesel generators, technical workshops, maintenance yards and fuel storage facilities Any non-compliance will be rectified immediately

Quarterly inspections, unannounced

PMU Monitor PMU and MOTC

B.B.2.10 Potential deficiencies of surface drainage at construction areas

The PMU will inspect and verify that adequate consideration and drainage works and protection have been provided: specifically that the 3 mitigative measures defined in B.B.2.9 of the mitigation table are fully implemented in a timely manner.

5X during the construction period, and 2X during each rainy season

PMU PMU and MOTC

B.B.2.11 Construction-related air pollution

Using a monitoring checklist confirm that the six mitigative actions defined in B.B.2.10 of the Mitigation Table are being implemented.

Ongoing throughout the project as part of the construction inspection

PMU PMU and MOTC

B.B.2.12 Damage or loss of cultural or archaeological heritage, including cemeteries and roadside graves/markers of accident victims.

Confirm that all roadside graves (based on an inventory of sites) are dealt with in a dignified and legal manner including viewing records of consultation with Akims and with family members and reviewing the process being taken for check the possible presence of cultural relics.

Continual checks each time a new construction section starts

PMU Monitor working with local authorities

PMU and MOTC

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B.3 OPERATION PERIOD Monitoring Aspect Monitoring Activity / Details / Outputs Timing Executing

Unit Reporting Responsibili

ty B.3.1 Post construction operational audit, 1-year after road completion

The owner of the road shall organize and undertake a complete environmental audit of the project. This audit is to be undertaken by the Oblast-level DOEP. Findings must be reported within 15 days of completion of the field inspection and actions to repair any non-compliance conditions started within 5 days of notification by the Inspection Department. All actions must be completed within 30 days.

No more than 13 months after the operating period has fully started.

MOTC, and MOEP

MOTC and Oblast-level Department of Env. Inspection Unit.

B.3.2 Risk of road accidents with pedestrians and domestic animals due to improved roads, faster speeds and greater traffic volume.

Report on the effectiveness of proposed measures for animal crossing structures, and make further recommendations to improve road safety with respect to these aspects. Reconsider, as necessary, strengthening and extension of animal fences along road. Accident Monitoring Report.

Undertake annual safety check and review statistics of livestock-vehicle accidents and address areas where problems occur

MOTC working with Oblast and Rayon level authorities

MOTC Environm. Budget 3.1

B.3.3 Risk of hazardous materials spills due to increased traffic volume

Elaboration of a contingency plan in case of major emergencies, and plan responsibilities for different scenarios.

after one year of operation

MOTC working with Oblast and Rayon level authorities

MOTC Environm. Budget 3.1

Abbreviations used in the EMP:

CEAP - Construction Environmental Action Plan CFH - Committee for Forestry and Hunting, under the Ministry of Agriculture DNRM Dept of Nature Resource Management and Environmental Management of Mangistau GoK - Government of Kazakhstan MOEP - Ministry of Environmental Protection MOTC - Ministry of Transport and Communication PMU - Projects Management Unit, Team of consultants working closely with the Implementing Agency, the Mangystau Road Committee (RC) RC - (Mangystau) Road Committee, under the MOTC RE - Resident Engineer SES - Sanitary and Epidemiological Services, under the Ministry of Health t.b.d. - to be determined

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Attachment 5

PROGRESS REPORT TEMPLATES A. Monthly Progress Report B. Quarterly Progress Report

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Monthly Project Progress Report LXXX-KAZ: I. Summary

• Overall implementation progress of the project II. Civil Works

A. Package 1: XXXX

• Provide update on procurement activities • Indicate progress in civil works vis-à-vis work program • Specify outputs and assess quality and timely completion • Assess efficiency of coordination arrangement with Construction Supervision

Consultant (CSC) • Provide update on payments and disbursements • Identify issues/problems including safeguards and implementation arrangements,

and indicate measures planned/undertaken to solve issues

B. Package 2: XXXX III. Consulting Services

A. Consultant 1: XXXX • Provide update on recruitment activities • Indicate progress of assignments (see TOR) vis-à-vis work plan • Specify outputs and assess quality and timely submission • Assess efficiency of coordination arrangement with contractors, consultants, EA, and

ADB • Provide update on payments and disbursements • Identify issues/problems, and indicate measures planned/undertaken to solve issues

B. Consultant 2: XXXX • Provide update on recruitment activities • Indicate progress of assignments (see TOR) vis-à-vis work plan • Specify outputs and assess quality and timely submission • Assess efficiency of coordination arrangement with contractors, and Project

Management Consultant (PMC) • Provide update on payments and disbursements • Identify issues/problems, and indicate measures planned/undertaken to solve issues

IV. Other Matters

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Quarterly Project Progress Report

Loan Number: Reporting Period: Quarter ___ 20__

Republic of Kazakhstan: Central Asia Regional Economic Cooperation Corridor 2 (Mangystau Oblast Section) Investment Program Prepared by: Ministry of Transport and Communications of Republic of the Kazakhstan

This report is a quarterly update to the project implementation progress. It is designed for ready use by the project executing agencies to provide direct input into ADB's internal Project Progress and Project Completion Reports.

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CONTENTS

Page

BASIC DATA I. SUMMARY: IMPLEMENTATION PROGRESS II. MANAGEMENT AND OPERATIONS

A. Implementation Arrangements B. Performance of Contractors, consultants, Borrower, MOTC and ADB C. Project Schedule D. Project Monitoring and Review

III. PROCUREMENT AND CONSULTING SERVICES IV. TECHNICAL

A. Project Outputs B. Project Performance and Quality

V. FINANCIAL A. Financial Plan B. Project Costs and Fund Utilization C. Financial Management

VI. SAFEGUARDS A. Environment B. Resettlement C. Labor, Gender, Health, and Social Protection

VII. SECTOR REFORM AND ANTICORRUPTION POLICY IMPLEMENTATION A. Sector Reform B. Anticorruption Policy Implementation

VIII. OTHERS Attachments 1. Progress of Project Outputs 2. Financial Management Action Plan 3. Updated Environmental Management Plan 4. Anticorruption Action Plan

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BASIC DATA

Loan Identification Loan Number XXXX Project Title Central Asia Regional Economic Cooperation Corridor 2

(Mangystau Oblast Section) Investment Program Borrower Republic of Kazakhstan Executing Agency Ministry of Transport and Communications (MOTC) Implementing Agency Committee of Roads Amount of Loan US$XXX million

Loan Data Appraisal Loan Negotiations Board Approval Loan Agreement Signing Loan effectiveness – In Loan Agreement – Actual Loan Closing – In Loan Agreement – Actual Terms of Loan – Interest Rate – Maturity (number of years) – Grace Period

Project Components, Costs, and Financing Plan (million US dollars)

Project Costs and Financing Plan Project Components ADB Gov't Total A. Civil Works B. Consulting Services Recurrent Costs Unallocated Total Project Costs

km = kilometer, pm = person-month.

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I. SUMMARY: IMPLEMENTATION PROGRESS Summarize the project implementation status as detailed in subsequent sections. It should analyze original and revised schedules and actual achievements/shortfalls in terms of physical and financial targets and accomplishments for the quarter (preferably in terms of broad components or identifiable physical elements). It would also contain conclusions about the viability of the original or earlier revised cost estimates and expected date of completion of the Project.

II. MANAGEMENT AND OPERATIONS A. Implementation Arrangements (i) Assess the adequacy of implementation arrangements (such as establishment, staffing,

and funding of the project implementing office) to deliver project outputs for the quarter. (ii) Discuss any major changes in the arrangements, and the effects on project

implementation progress. (iii) Provide the status of compliance to the following loan covenants on implementation

arrangements. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) not complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action. • The Borrower shall make available, promptly as needed, the funds, facilities,

services, land and other resources which are required, in addition to the proceeds of the Loan, for the carrying out of the Project and for the operation and maintenance of the Project facilities.

• The Borrower shall ensure that the activities of its departments and agencies with respect to the carrying out of the Project and operation of the Project facilities are conducted and coordinated in accordance with sound administrative policies and procedures.

• MOTC will be designated as the EA, which is responsible for the overall Project implementation and liaising with ADB and other IFI involved in the CAREC Transport Corridor 1 improvement. MOTC will designate COR as the Project implementation agency. MOTC will appoint a Project Director from its qualified staff with experience in project management acceptable to ADB. The Project Director will be responsible for the day-to-day implementation of the Project and the Investment Program, including the project preparation, implementation, monitoring and reporting.

• MOTC will ensure that (a) the PMC-ADB is recruited in a timely manner, and (b) the Project Director is adequately assisted throughout the Project implementation period by MOTC staff responsible for road engineering, financial, legal and procurement matters.

• MOTC will ensure that the Project Director is supported by the PMC-ADB in implementing the Project.

• MOTC will ensure that the PMC-WB is established in a timely manner to coordinate all activities under the CAREC Transport Corridor 1 improvement and provide necessary support for safeguard compliance, legal and financial management under the Project.

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B. Performance of Contractors, Consultants, Borrower, MOTC, and ADB Contractors and Consultants (i) Describe the performance of contractors and consultants for the quarter under reporting.

If they did not perform exceptionally well, describe the effects on the delivery and quality of the outputs, schedule, and/or costs.

Borrower, MOTC, and COR (ii) Summarize the performance of the borrower, MOTC and COR in meeting the

responsibilities assigned in the implementation plan, and discuss any strengths/weaknesses in performance for the quarter under reporting.

(iii) Assess the present institutional capacity and development of the MOTC and COR, including specific strengths and weaknesses, and whether the institutional development measures envisaged at appraisal were adequate or successful. Assess how the project preparatory TA helped improved institutional capacity.

ADB (iv) Review ADB’s part in project implementation for the quarter (e.g., approvals,

disbursements, and monitoring) to determine whether any ADB failure to act promptly, or disagreements with the borrower or EA on terms of reference, bid documents, awards, or other matters affected the implementation procedures, project (program) costs, or implementation schedule.

C. Implementation Schedule (Assess the progress in implementing the overall project to date in comparison with the original implementation schedule. Explain the causes of significant delays, if any. Discuss any changes in the original/revised plans and schedules or deviations - both actual or expected - except that any such change requiring ADB approval should be reported to ADB immediately and subsequently mentioned in the quarterly report.

D. Project Monitoring, Review and Reporting

Provide the status of compliance to the following loan covenants. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) not complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action. (i) MOTC will establish a Project Performance Monitoring System within six (6) months of

the Effective Date and collect baseline data for performance monitoring. Performance and monitoring reports should be submitted to ADB on an semiannual basis.

(ii) MOTC will submit quarterly progress reports within 2 weeks of the end of each quarter covered. A joint mid-term review will be carried out 2 years after the effective date.

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III. PROCUREMENT AND CONSULTING SERVICES (i) Indicate the status of procurement and consultant recruitment activities. Describe

whether, or not the activities are on schedule. If there are delays, provide the reasons; and discuss the planned/undertaken options to resolve them. If there are remaining civil works to be procured or consultants to be recruited, provide the schedule for monitoring the procurement or recruitment activities.

(ii) Discuss arrangements for consultant recruitment, any deviations from agreed-upon procedures, and the causes of disagreements between the borrower or EA and ADB on consultant selection. State how the differences were resolved, or will be resolved.

(iii) Discuss any changes in the original/revised procurement plan, including mode of procurement. Describe any significant problems (e.g., misprocurement) encountered in packaging contracts, preparing tender documents, and evaluating bids. State how they were resolved, or will be resolved.

Note: Once procurement and consultant recruitment activities are completed, this section could be excluded from the next quarterly progress reports.

IV. TECHNICAL A. Project Outputs (i) Analyze the progress of each component during the quarter under reporting. Give reasons

for any changes, deviations, or delays, and indicate whether these affected project costs, time schedules, expected benefits, or other measures of efficiency. Compare the actual progress with that of the original forecast as of this date. • physical works accomplished for the three civil works contracts (i.e., km-length of

roads reconstructed; preparation made). . • system developed for road operation and maintenance

(ii) Describe the expected progress to be achieved in the next quarter. (iii) Discuss any difficulties or unusual occurrences affecting the progress of the project

components. Discuss any risks, and measures to mitigate risks. (iv) State the measures taken or planned to correct the factors responsible for delay during the

quarter or which are likely to affect physical progress in the future. (v) Indicate the expected date of completion of major components (physical and non-physical

elements) of the project (vi) Assess the validity of key assumptions and risks in achieving the targeted outputs. (vii) Update table on Attachment 1.

Note: Construction progress should be supported by drawings, bar charts, simplified CPM or PERT diagrams. Likewise, useful photographs with proper identification and dates should be used to reflect project progress or explain difficulties. B. Project Performance and Quality Provide the status of compliance to the following loan covenants. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) note complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action.

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(i) The Project is carried out in accordance with the applicable technical specifications and

design, and that the construction supervision, quality control and Project management are performed in accordance with applicable standards and best international practices.

(ii) All Works contracts include a contractor's obligation to comply with road safety measures; and the accident rate and traffic volume is monitored during the operation of the Project Road.

V. FINANCIAL

A. Financial Plan

Discuss the financial achievements of the annual financing plan for the Project during the quarter. The details should at least cover the following: (a) amount requested by the MOTC for allocation in the annual budget, (b) amount allocated under the annual budget, (c) adequacy of allocation in terms of physical targets and latest cost estimate, (d) utilization during the quarter under reporting, (e) utilization in the next quarter, (f) forecast on utilization during the next quarter, (g) difficulties in getting the allocated amount released due to budgetary or other procedure, etc. if applicable.

B. Project Costs, and Fund Utilization

(i) Discuss viability of the original or revised cost estimates. Explain significant overruns or

underruns, if any, or whether an overall project cost overrun or underrun is likely. State the reasons for cost changes (status of contract awards, change on exchange rates, change in source of procurement/specifications, design inadequacy, external factors, delays, etc. and their likely effect on the project's economic and financial rates of return. Assess the need to reestimate costs to completion, or reallocate costs within ADB loan categories. Update project cost and financing plan, if necessary.

(ii) Analyze and compare contract awards achievements (cumulative, annual, and quarterly) with projections. Adjust projected amount for succeeding quarters with justification, if necessary.

(iii) Analyze and compare disbursements achievements (cumulative, annual, and quarterly) with projections. Adjust projected amount for succeeding quarters with justification.

(iv) Discuss any issues/problems in submitting withdrawals, and measures planned/ undertaken to resolve issues.

(v) Provide an update on monitoring and reporting of withdrawal applications processing every 15th of the month.

C. Financial Management

(i) Assess financial management capacity of the executing and implementing agencies. (ii) Assess whether ADB funds were not applied to the activities described on the ADB

Prohibited Investment Activities List in Appendix 5 of the Safeguard Policy Statement (SPS) (2009).

(iii) Provide the status of compliance to the following loan covenants on finance. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) note complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action.

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• All required counterpart funds should be available for timely and effective

implementation of the Project through annual budget allocations to MOTC, and the resources are releases on time.

• The Borrower will maintain separate project accounts and records by funding source for all expenditures incurred on the Project. Project accounts will follow Government's accounting laws and regulations.

• The Borrower will submit certified copies of the audited accounts and financial statements and the report of the auditors relating thereto in the English language within 6 months of the end of the fiscal year.

• The Borrower will discuss with ADB (upon ADB's request) the Borrower's financial statements of the project and its financial affairs related to the Project.

• MOTC will submit a certification that the PMC-ADB has been adequately staffed, including appointment of Project Director, and become operational before withdrawals can be made.

• MOTC will implement the financial management action plan. Update the progress of implementing the financial management action plan in Attachment 2.

• MOTC will allocate routine maintenance budget in accordance with the Road Development Program.

VI. SAFEGUARDS

A. Environment (i) Assess the progress of environmental management including measures for the mitigation

of adverse environmental impacts in accordance with the environmental impact assessment; and update of environment management plan in Attachment 3.

(ii) Provide the status of compliance with the loan covenants on environment. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) note complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action. • The EMP is updated prior to issuance of any notice to proceed. • No notice to proceed (subsequent to contract awards) is issued to contractors for the

respective sections or parts of the Project Road until the applicable provisions of the IEE and EMP have been complied with.

• The design, construction, and operation and maintenance of the Project facilities are carried out in accordance with ADB’s Safeguard Policy Statement (2009), the Kazakhstan's environmental laws and regulations, the EARF prepared for the Investment Program and agreed with ADB, and the IEE; and potential adverse environmental impacts arising from the Project are minimized by implementing all mitigation and monitoring measures as presented in the EMP.

• The detailed engineering design and the Works contracts under the Project incorporate applicable environmental measures identified in the IEE and the EMP; and contractors are supervised to ensure compliance with the requirements of the IEE and the EMP.

• Sufficient resources are made available to implement, monitor, and record the implementation of the EMP.

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• Semi-annual environmental reports are prepared and submitted to ADB within one (1) month of the end of each period covered. The reports include, inter alia, a review of progress made on the implementation of the EMP, problems encountered and remedial measures taken.

B. Resettlement (i) Assess progress of implementation of the resettlement plan, including salient

achievements and problems faced and how these have been resolved. (ii) Provide status of compliance with the following resettlement loan covenants. Indicate

which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) note complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action. • No contract is awarded for Works under the Project until a LARP has been prepared

by the Borrower, if so required based on detailed design, and cleared by ADB in accordance with paragraph 11 to Schedule 5 to this Loan Agreement.

• No notice to proceed (subsequent to contract awards) is issued to contractors for the respective sections or parts of the Project Road until the applicable provisions of the LARP (including, in particular, the provision on the timely payment of compensations to affected persons) have been complied with.

• The Project is carried out in accordance with the Borrower’s applicable laws and regulations, ADB’s Safeguard Policy Statement (2009), the LARF and the LARP including, inter alia, the following provisions: (a) the LARP shall be disclosed to affected persons in accordance with the LARF; (b) the LARP shall be submitted to ADB for review and clearance prior to award of any Works contract; (c) all land and rights of way required by the Project shall be acquired and made available in a timely manner; (d) all compensation and resettlement assistance shall be provided to affected persons prior to their displacement and dispossession and the compensation program of the LARP shall be fully implemented prior to issuing any notice to proceed; (e) efficient grievance redressal mechanisms shall be in place to assist affected persons resolve queries and complaints if any, in a timely manner; (f) adequate staff and resources shall be made available for supervising and monitoring the implementation of the LARP. An external resettlement monitor, acceptable to ADB, shall carry out external monitoring and evaluation of the LARP and shall report the results to ADB at the start and completion of the LARP implementation process; and (g) if during implementation of the LARP, any changes to the location, land alignment of roads, or additional environmental and/or resettlement impacts are identified, the LARP shall be updated and prior approval by ADB and the relevant government agencies shall be obtained before further implementation of the LARP.

C. Labor, Gender, Health, and Social Protection Provide status of compliance with the following resettlement loan covenants. Indicate which of the following covenants were (i) complied with, (ii) late complied with, (iii) ongoing, or (iv) note complied with. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants

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on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action.

• Specific provisions are included in the bidding documents and contracts requiring that civil works contractors (i) comply with applicable core labor standards, labor laws and incorporate applicable workplace occupational safety norms; (ii) do not differentiate payment between men and women for work of equal value; (iii) do not employ child labor in the construction and maintenance activities; and (iv) to the extent possible, maximize employment of local poor and disadvantaged persons for project construction purposes, provided that the requirements for job and efficiency are adequately met.

• Appropriate entities, including NGOs, are involved in disseminating information on the risks of sexually transmitted diseases, including HIV/AIDS, to the employees of civil works contractors under the Project and to members of the local communities surrounding the Project Road.

VII. SECTOR REFORM AND ANTICORRUPTION POLICY IMPLEMENTATION

A. Sector Reform Indicate status of compliance with the sector Roadmap which identifies the institutional development actions as set out in Table 1 of Schedule 1 in the Road Development Program 2006-2012 and Transport Strategy for the Republic of Kazakhstan); and inform ADB of any changes to and progress in implementing the Roadmap, Investment Program and the financing plan. B. Anticorruption Policy (i) Assess the status of implementation of the Anticorruption Action Plan (see Attachment

4) (ii) Indicate the status of compliance with the loan covenant relating to anticorruption policy of

ADB. If compliance was delayed or breached, discuss the reasons and impact, and whether the covenant was realistic. Discuss the impact of partial or noncompliance of covenants on project performance. Recommend ways to achieve compliance. Indicate if any covenant has been modified, suspended, or waived, and the justification for such action. • The Borrower agrees (a) that ADB has the right to investigate any alleged corrupt,

fraudulent, collusive or coercive practices relating to the Project; and (b) to cooperate and assist fully with any such investigation for the satisfactory completion of any such investigation.

• The Borrower shall (a) conduct periodic inspections on the contractors’ activities related to fund withdrawals and settlements; (b) ensure that all contracts financed by ADB in connection with the Project include provisions specifying the right of ADB to audit and examine the records and accounts of all contractors, suppliers, consultants, and other service providers as they relate to the Project; (c) ensure that the construction supervision consultant verifies the contractors’ payment certificates in accordance with working drawings and contract specifications; and (d) ensure that the anticorruption action plan agreed with ADB is implemented).