Upload
others
View
1
Download
0
Embed Size (px)
Citation preview
Document of
The World Bank
FOR OFFICIAL USE ONLY
Report No: 58890-EG
PROJECT APPRAISAL DOCUMENT
ON A
PROPOSED LOAN
IN THE AMOUNT OF
US$200 MILLION
TO THE
ARAB REPUBLIC OF EGYPT
FOR THE
SECOND INTEGRATED SANITATION AND SEWERAGE INFRASTRUCTURE PROJECT
June 6, 2011
Sustainable Development Department
Middle East and North Africa Region
This document has a restricted distribution and may be used by recipients only in the performance of their official
duties. Its contents may not otherwise be disclosed without World Bank authorization.
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
Pub
lic D
iscl
osur
e A
utho
rized
CURRENCY EQUIVALENTS
(Exchange Rate Effective April 13, 2011)
Currency Unit = Egyptian Pound
LE1 = US$0.173
US$1 = LE 5.96
FISCAL YEAR
January 1 – December 31
ABBREVIATIONS AND ACRONYMS
ARP
ASBR
Abbreviated Resettlement Plan
Advanced Sequential Batch Reactors
BD Bidding Document
BOD Biological Oxygen Demand
DA Designated Account
DO Dissolved Oxygen
EC European Commission
EEAA Egyptian Environmental Affairs Agency
ERR Economic Rate of Return
ESAF Environmental and Social Assessment Framework
ESMMF Environmental & Social Management & Monitoring Framework
ESW Economic Sector Work
EU European Union
EWRA Egyptian Water Regulatory Agency
FC Fecal Coli form
FM Financial Management
FMS Financial Management Specialist
FY Fiscal Year
GDP Gross Domestic Product
GOE Government of Egypt
GIZ German Society for International Cooperation
HCWW Holding Company for Water and Wastewater
IBRD International Bank for Reconstruction and Development
ICB International Competitive Bidding
IDA International Development Association
IFR Interim Financial Report
ISSIP Integrated Sanitation and Sewerage Infrastructure Project
IWSP
JSDF
Improved Water and Sanitation Program
Japan Social Development Fund
LAU Local Administrative Unit
LE Egyptian Pound
M&E Monitoring and Evaluation
MOHP Ministry of Health and Population
MOHUUD Ministry of Housing, Utilities and Urban Development
MOPIC Ministry of Planning and International Cooperation
MWRI Ministry of Water Resources and Irrigation
NCB National Competitive Bidding
NOPWASD National Organization for Potable Water and Sanitary Drainage
O&M Operation and Maintenance
OP Operational Policy
PAD Project Appraisal Document
PAP Project Affected Persons
PFS Project Financial Statement
PIC Public Information Center
PID Project Information Document
PIM
PIU
PMCF
Project Implementation Manual
Project Implementation Unit
Program Management Consulting Firm
PMU Project Management Unit
PS Pumping Station
QA Quality Assurance
RBC
RAP
Rotating Biological Contractor
Resettlement Action Plan
RPF Resettlement Policy Framework
RSU Rural Sanitation Unit
SA Social Assessment / Special Account
SBD Standard Bidding Documents
SIL Specific Investment Loan
TA Technical Assistance
TOR Terms of Reference
TSS Total Suspended Solids
TTL Task Team Leader
UASB Up flow Anaerobic Sludge Blanket
UNICEF The United Nations Children‟s Fund
WQ Water Quality
WSC Water and Sanitation Company
WUA Water Users‟ Association
WWTP Wastewater treatment plant
Vice President: Shamshad Akhtar
Country Director: A. David Craig
Sector Director Laszlo Lovei
Sector Manager: Francis Ato Brown
Task Team Leader: Parameswaran Iyer
Table of Contents
I. Strategic Context .................................................................................................................... 1
II. Project Development Objectives............................................................................................ 4
III. Project Description................................................................................................................. 4
IV. Implementation ...................................................................................................................... 6
V. Key Risks ............................................................................................................................... 8
Annex I: Results Framework and Monitoring .............................................................................. 15
Annex II: Detailed Project Description......................................................................................... 18
Annex III: Implementation Arrangements .................................................................................... 22
Annex IV: Operational Risk Assessment Framework (ORAF) .................................................... 30
Annex V: Implementation Support Plan ...................................................................................... 34
Annex VI: Team Composition ...................................................................................................... 36
This document has a restricted distribution and may be used by recipients only in the performance of their official
duties. Its contents may not otherwise be disclosed without World Bank authorization.
PAD DATA SHEET
ARAB REPUBLIC OF EGYPT
THE SECOND INTEGRATED SANITATION AND SEWERAGE
INFRASTRUCTURE PROJECT
PROJECT APPRAISAL DOCUMENT
MIDDLE EAST AND NORTH AFRICA
Sustainable Development Department
Date: June 6, 2011
Country Director: A. David Craig
Sector Director: Laszlo Lovei
Sector Manager: Ato Brown
Team Leader: Parameswaran Iyer
Project ID: P120161
Lending Instrument: SIL
Sectors: Sanitation (20%); Sewerage (80%)
Themes: Rural Services and Infrastructure (P)
Environmental Assessment
Screening Category: B
Project Financing Data:
Proposed terms:
[X] Loan [ ] Credit [ ] Grant [ ] Guarantee [ ] Other:
Source Total Amount (US$M)
Total Project Cost:
Cofinancing:
Total Bank Financing:
IBRD
IDA
New
Recommitted
Others
310
110
200
Borrower:
Arab Republic of Egypt
Implementing Agency:
Ministry of Housing, Utilities and Urban Development,
12 Ismail Abaza Street, Cairo, Arab Republic of Egypt
Responsible Sub-Agencies:
1. National Organization for Potable Water and Sanitary Drainage (NOPWASD)
Arab Republic of Egypt.
Contact Person: Eng. Samia M. Saleh Badr El Din
Telephone No.: +202-33042922
ii
2. Holding Company for Water and Waste Water (HCWW)
Arab Republic of Egypt.
Contact Person: Eng. Mamdouh Raslan
Telephone No.: +202-24583591
Estimated Disbursements (Bank FY/US$ m)
FY 2012 2013 2014 2015 2016 2017
Annual 0 25 40 60 60 15
Cumulative 0 25 65 125 185 200
Project Implementation Period: Start: January 2012 End: December 2016
Expected effectiveness date: January 1, 2012
Expected closing date: December 31, 2016
Does the project depart from the CAS in content or other significant
respects?
○ Yes No
If yes, please explain:
Does the project require any exceptions from Bank policies?
Have these been approved by Bank management?
Is approval for any policy exception sought from the Board?
○ Yes No
○ Yes ○ No
○ Yes No
If yes, please explain:
Does the project meet the Regional criteria for readiness for
implementation?
Yes ○ No
Project Development Objective:
The Project Development Objective is to provide targeted populations in the Governorates of Menoufia,
Sharkeya, Assiut and Sohag with increased access to improved sanitation and sewerage services.
Project description
The Project consists of the following parts:
Component 1: Construction of wastewater infrastructure systems in selected village clusters in the
Governorates of Menoufia and Sharkeya, including wastewater treatment plants, collection networks,
customer connections, and decentralized treatment systems.
Component 2: Construction of wastewater infrastructure systems in selected village clusters in the
Governorates of Assiut and Sohag, including wastewater treatment plants, collection networks, customer
connections, and decentralized treatment systems.
Component 3: Support HCWW and NOPWASD in project implementation, monitoring and evaluation and
management, including construction supervision and environmental management services.
Safeguard policies triggered?
Environmental Assessment (OP/BP 4.01)
Natural Habitats (OP/BP 4.04)
Forests (OP/BP 4.36)
Pest Management (OP 4.09)
Yes ○ No
○ Yes No
○ Yes No
○ Yes No
iii
Physical Cultural Resources (OP/BP 4.11)
Indigenous Peoples (OP/BP 4.10)
Involuntary Resettlement (OP/BP 4.12)
Safety of Dams (OP/BP 4.37)
Projects on International Waters (OP/BP 7.50)
Projects in Disputed Areas (OP/BP 7.60)
○ Yes No
○ Yes No
Yes ○ No
○ Yes No
○ Yes No
○ Yes No
Conditions and Legal Covenants:
Loan Agreement
Reference Description of Covenant When Due
1. Schedule 2 Section
I A. 4
An interagency agreement has been executed between the
National Organization for Potable Water and Sanitary
Drainage (NOPWASD) and the Holding Company for
Water and Wastewater (HCWW) in form and substance
acceptable to the Bank.
45 days after
effectiveness
2. Schedule 2 Section
I A. 4
The Borrower has adopted the updated Project
Implementation Manual (PIM), in form and substance
acceptable to the Bank.
45 days after
effectiveness
3. Section IV. B 1 No withdrawal shall be made (a) for payments prior to the
date of the Loan Agreement; or (b) for works under the
project until the Borrower has acquired and installed
accounting software for the Project, acceptable to the Bank.
Disbursement
condition
4. Schedule 2, Section
I B 1
The Borrower shall:
(a) prepare and disclose, prior to the commencement of
any construction works requiring land acquisition
under the Project, a Resettlement Action Plan,
acceptable to the Bank, in accordance with the RPF;
(b) Implement the Resettlement Action Plan, including,
unless otherwise agreed with the Bank, payment in
full of compensation to all affected people prior to
commencing of any related works. Except as
mutually agreed upon between the Borrower and the
Bank, the Borrower shall not amend, suspend or
abrogate any of the provisions of the Resettlement
Action Plan.
Implementation
iv
1
I. Strategic Context
A. Country Context
1. Egypt is undergoing a process of in-depth political and social transformation in the
aftermath of the January 2011 revolution. Experience in other countries suggests that this
process may unfold over a relatively long period of time, during which the situation will remain
fraught with significant risks and uncertainties - and during which external assistance can yield
disproportionate social returns. Indeed, poverty, living conditions, citizen participation, and
governance have come to the forefront of the political and social debate, with most of the
discussions focused on "how to" effect rapid change. In spite of the political turmoil, Egypt
retains its solid administrative capacity, including the capacity to implement externally financed
operations.
2. With a population of 80 million people of which about half live in rural areas, Egypt has
achieved steady economic growth over the past decade. The recent international economic
slowdown has reduced the country‟s GDP growth rate from over 7 percent in 2006-2008 to 4.5
percent in 2009, but the economy was showing positive signs of recovery from the mild effects
of the global crisis, the GDP registering a 5.6 percent increase in the first half of FY2011, up
from 5.1 percent in FY10. Growth is expected to stand at 2 percent for FY2011, reflecting the
short-term impact of the political events. It is expected to rebound to 4 percent in FY2012, as
tourism receipts recover and business and financial activities resume. Egypt is expected to face,
however, a large fiscal deficit in FY2011, in excess of 10 percent of GDP from 8.1 percent of
GDP in FY2010 and significant pressures on its balance of payments.
3. Regional disparities have marked Egypt‟s development, with greater poverty and less
economic development in Upper Egypt compared to the heavily populated Delta region. Rural
Upper Egypt has the highest incidence of poverty (34 percent) in the country. While poverty fell
between 1995/96 and 1999/2000 for the rest of Egypt, it increased in rural Upper Egypt, clearly
indicating that the overall economic growth in the country has not resulted in poverty reduction
in Upper Egypt.
4. The Government of Egypt (GoE) has ambitious plans for economic development to
improve living standards in the country. The Introduction to the Sixth Five Year Plan1 specifies
the “prioritizing of public policies and investments and channeling them into two venues”: (a)
intensifying investments in infrastructure projects, where investments on potable water and
sanitation would exceed a quarter of total investments; and (b) achieving regional balance by
allocating 42 percent of local public investments to fostering development in Upper Egypt
Governorates as part of the national program for the region's development.
1 Preface to Sixth Five Year Plan, Ministry of Economic Development , Government of Egypt website
2
B. Sectoral and Institutional Context
Sanitation in Egypt
5. With almost full coverage of water supply in urban as well as rural areas, the safe
disposal of wastewater in Egyptian villages now represents a major challenge to the environment
and to public health. While at least 85 percent of rural households have some type of sanitary
facility (usually a septic tank), only a limited percentage of villages have facilities for safe
collection, conveyance, and treatment of wastewater. Currently, wastewater is discharged
(usually without treatment) to agricultural drains and sometimes to canals. Such water pollution
in drains and canals is a grave threat to public health. Further, higher subsurface water levels,
especially in the Delta, make most septic tanks an ineffective means of safe disposal of
wastewater.
6. GoE attaches high priority to safe disposal of wastewater in rural areas and has prepared
a “National Rural Sanitation Master Plan”2, which targets comprehensive sanitation coverage to
the populations of all rural Governorates by 2037, with a required investment of LE62 billion. In
addition, the Government‟s 2008 “National Rural Sanitation Strategy”3 seeks to prioritize sector
investments and provide a roadmap to comprehensive coverage of rural sanitation. Thus, in
recent years, significant investments have been made to bridge the gap between supply and
demand for wastewater treatment in rural areas, with the Government committing to invest LE20
billion in the period 2007-2012 exclusively for rural sanitation. Despite these efforts, there is still
a significant gap between urban and rural sanitation coverage, which are estimated at 70 percent
and 25 percent respectively.
7. As part of the Government‟s sector reform agenda, the Holding Company for Water and
Wastewater (HCWW) was created in 2004, followed by the Egypt Water and Wastewater
Regulatory Agency (EWRA). Twenty three Water and Sanitation Companies (WSCs) have
subsequently been established at the Governorate level as subsidiaries of HCWW. The reform
agenda was taken forward recently with the approval and announcement of “Development
Policies: Water and Wastewater Sector in Egypt”43
in September 2010, which provides a
framework and direction for further sector development and as a guide for institutions operating
in the sector.
8. One of the principal objectives of the new policy is “to achieve financial sustainability of
the service providers, so as to enable them to improve their efficiencies and increase their levels
of service”. The Egyptian water and wastewater sector has operated “under a regime of
restricted pricing policies, limited investment programs, and under-financing of operational
activities”. The Policy envisages that HCWW‟s subsidiary WSCs will submit business plans to
EWRA, indicating, inter alia, when they will achieve financial sustainability. EWRA will
permit periodic tariff increases to enable the sector to gradually move towards full cost recovery.
Until such time full cost recovery is achieved, government will provide annual subsidies to the
2 National Strategy for Water Supply and Sanitation: Compilation of Water and Sanitation Master Plans, HCWW report for the
European Commission, May 2009. 3 Egypt National Rural Sanitation Strategy, Holding Company for Water and Wastewater, September 2008 4”
Development Policies for the Water and Waste Water Sector in Egypt” MOHUUD, policy paper, September 2010
3
WSCs to cover funding gaps to meet operating expenses, as well as new capital investments and
replacement of assets.
9. In support of GoE‟s sector reform agenda, the Bank is supporting the Integrated
Sanitation and Sewerage Infrastructure Project (ISSIP Loan No. 7512-EGT, for US$120 million)
for improvements in sanitation in three Governorates in the Delta region. The proposed project
will continue Bank support to the sector in priority Governorates identified by government.
Institutional Framework
10. The main institutional players in the water and sanitation sector are:
The Ministry of Housing, Utilities and Urban Development (MOHUUD) is in charge
of the water and sanitation sector and is primarily responsible for policy formulation,
monitoring and coordination.
The National Organization for Potable Water and Sanitary Drainage (NOPWASD) is the government agency under MOHUUD responsible for the planning, design and
implementation of water and wastewater infrastructure throughout the country, with the
exception of Greater Cairo and Alexandria.
The Holding Company for Water and Wastewater (HCWW) is the owner of the 23
subsidiary WSCs. It was established by a Presidential Decree to purify, desalinate,
distribute and sell drinking water, and collect, treat and safely dispose of wastewater.
Water and Sanitation Companies (WSCs) are responsible for service delivery of water
and wastewater in their respective Governorates, including construction of water and
wastewater networks and operation and maintenance (O&M) of water supply and
wastewater facilities.
Donor Activity in Egypt
11. A number of donors are active in the sector, including the European Union (EU) and the
Governments of Switzerland, Germany, United States and Japan. An EU led consortium is
implementing the Second Improved Water and Wastewater Services Project (IWSP, Euro300
million) in the Governorates of Qena, Assiut, Sohag and Minya, to be followed by another
investment support program in additional Governorates. The United States, Germany, Holland
and Japan mainly focus on providing TA support to GoE at the central and Governorate levels.
ISSIP2 will coordinate closely with other donor efforts in the water and sanitation sector at both
the central and project Governorate levels. Following the aftermath of the January 2011
revolution, most donor agencies are working closely with the Egyptian government and have
indicated their intent to provide support to the new authorities.
4
A. Higher Level Objectives to which the Project Contributes
12. The proposed project is fully consistent with GoE national priorities of increasing rural
sanitation coverage and accelerating development in Upper Egypt, as well as the World Bank
Country Assistance Strategy (CAS, FY 2006-FY 2009) goals of: (a) reducing disparities between
Upper and Lower Egypt; (b) enhancing the provision of public goods through expanded supply
and improved efficiency of infrastructure services; and (c) strengthening the accountability of
public sector agencies such as those in the water and sanitation sector.
II. Project Development Objectives
A. PDO
13. The Project Development Objective is to provide targeted populations in the Governorates
of Menoufia, Sharkeya, Assiut and Sohag with increased access to improved sanitation and
sewerage services.
B. Beneficiaries
14. The beneficiaries of ISSIP2 will be about 1.2 million people (half of whom are estimated
to be women) in the project villages in Menoufia, Sharkeya, Assiut and Sohag.
C. PDO Level Results Indicators
15. The PDO level results indicators are:
Increased number of people connected to improved sanitation and sewerage services
in the project areas.
Number of wastewater treatment plants meeting Egyptian effluent treatment
standards.
Volume of wastewater treated.
III. Project Description
A. Project components
16. The three components of ISSIP2 are:
Component 1: Wastewater infrastructure systems in rural areas in Menoufia and Sharkeya
(Estimated cost US$149.75 million). Construction of wastewater infrastructure systems in
selected village clusters in the Governorates of Menoufia and Sharkeya, including wastewater
treatment plants, collection networks, customer connections, and decentralized treatment
systems.
5
Component 2: Wastewater infrastructure systems in rural areas in Assiut and Sohag
(Estimated cost US$149.75 million). Construction of wastewater infrastructure systems in
selected village clusters in the Governorates of Assiut and Sohag, including wastewater
treatment plants, collection networks, customer connections, and decentralized treatment
systems.
Component 3: Project Management (Estimated cost US$10 million). Support HCWW and
NOPWASD in project implementation, monitoring and evaluation and management, including
construction supervision and environmental management services. This component will be
financed entirely out of counterpart funds.
A. Lending Instrument
17. The lending instrument is a Specific Investment Loan (SIL) for US$200 million through a
Variable Spread Loan (VSL) with a 28.5 year maturity and a seven-year grace period. The Loan
will be denominated in US Dollars.
B. Project Financing Table
18. Table 1 indicates the project cost by component and the financing plan. Project financing
is structured such that should any of the project Governorates lag significantly behind others
during project implementation, funds can be reallocated to other project Governorates where
implementation is progressing well.
Table 1. Project Cost by Component
(US$ Million)
Component Total World
Bank
GoE
Component 1: Wastewater infrastructure systems in Menoufia and Sharkeya
A. WWTPs
B. Network Clusters
44.75
105.00
29.75
70.00
15.00
35.00
Component 2: Wastewater infrastructure systems in Assiut and Sohag
A. WWTPs
B. Network Clusters
19.75
130.00
12.75
87.00
7.00
43.00
Component 3: Project Management
A. Construction Supervision
B. Project Management Unit Staff
C. Training and Utility Strengthening
D. ESMMF Implementation
6.00
2.00
1.00
1.00
0
0
0
0
6.00
2.00
1.00
1.00
Total Project Cost
Front-End Fee
Total Financing Required
309.50
0.50
310.00
199.50
0.50
200.00
110.00
0
110.00
Estimates include contingencies and taxes at the Feasibility Stage
Components 1 and 2 represent co-financing with a cost sharing ratio of 2/3 World Bank and 1/3 GoE
Component 3 is financed entirely out of counterpart funds
6
Lessons Learned and Reflected in the Project Design
19. The project approach and design draws on the experience of the on-going ISSIP and that
of GoE and the various donors in implementation of sanitation projects in Egypt over the past
two decades. The key lessons learned are listed below:
Benefit of detailed designs. For a more realistic estimate of project costs and scope, and
to enable potential contractors to submit better bids, it is important to include detailed
engineering designs in the bid documents of network cluster packages. This approach is
being adopted in ISSIP2.
Smaller procurement packages. Use of large procurement packages restricts bidding to
a limited number of larger contractors, and limits competition. ISSIP2 proposes to
package network cluster contracts in relatively smaller procurement packages so that
smaller contractors are eligible to bid.
Decentralized systems. Bids received for three “GIZ-model” schemes of
smaller/decentralized wastewater treatment systems were three times the estimated costs
in ISSIP. As ISSIP2 preliminary feasibility studies also indicated that
smaller/decentralized wastewater systems are more expensive compared to the cluster
approach, they are currently excluded from ISSIP2. Decentralized systems will be
considered for inclusion in ISSIP2 Phase 2, subject to their being successfully piloted in
ISSIP and after detailed cost evaluations.
Sustainable Operation and Maintenance (O&M). From international experience, many
water and sanitation systems have failed to continue operating efficiently due to lack of
adequate O&M funding and limited management capacity at the local level. ISSIP2
design builds on the GoE commitment to continue subsidies for WSC O&M costs and
includes a training and capacity building component to strengthen management capacity.
Implementation and loan disbursements take time. As investment projects in the
water sector in Egypt require significant start-up time, as demonstrated in ISSIP, ISSIP2
disbursements have been appropriately staggered. In addition, the procurement process
for civil works for Phase 1 of the project will commence well in advance of loan
effectiveness, so that contracts can be signed and disbursements made as soon as possible
after loan effectiveness. Loan funds may also be reallocated between the project
Governorates based on their demonstrated ability in implementing the project in a timely
manner.
IV. Implementation
A. Institutional and Implementation Arrangements
20. The project will be implemented through the following institutions at the national and
local levels:
The existing ISSIP Project Steering Committee will provide coordination, oversight,
and overall direction to ISSIP2 as well. It is headed by the Minister of Housing, Utilities,
and Urban Development or his delegate, and comprises representatives of HCWW,
NOPWASD, EWRA, MWRI, MOPIC and MOHP. Representatives of the project WSCs
7
and the local popular councils from each of the four Governorates will be added to the
Committee. The Director of the Project Implementation Unit in HCWW will act as the
Secretary of the Project Steering Committee.
The existing HCWW Project Implementation Unit (PIU), which is responsible for
ISSIP, will also act as the PIU for ISSIP2. Its current team of a PIU Director, supported
by specialist staff from HCWW, will be enlarged, both through staff and additional long-
term and short-term technical assistance specialists. The HCWW PIU will work closely
with NOPWASD and the four WSCs. HCWW will be responsible for the construction of
pump stations, sewer networks and force mains.
The existing NOPWASD ISSIP Unit will be responsible for the design and
implementation of all new wastewater treatment plants under the project.
Rural Sanitation Units (RSUs) have been established within each of the four WSCs,
comprising engineering, financial management, procurement, environmental/social and
monitoring and evaluation specialists, and will be supported by long and short-term
technical assistance in different fields.
Local Administrative Units (LAUs), the lowest level in the local administration system
in Egypt, will provide forums and venues for engagement with local communities.
B. Results Monitoring and Evaluation
21. The project‟s M&E system will build on the extensive monitoring of all WSCs already
carried out by HCWW through the use of over 60 standard indicators, as well as the existing
ISSIP M&E system. Annex I provides details on the proposed responsible entities and the overall
M&E framework.
C. Sustainability
22. MOHUUD‟s recently issued development policies for the sector demonstrate
government‟s strong commitment to the development of the sector in a sustainable manner. At
the project level, sustainability will depend on the ability of the four project WSCs to operate and
maintain project financed assets in an efficient and effective manner. Project WSCs are
relatively young commercial organizations, with adequate qualified and experienced staff.
HCWW will provide focused technical and commercial training under the project to staff of the
WSCs. Government has confirmed that the practice of providing annual operating and capital
subsidies to the WSCs will be applicable to the project WSCs, until they achieve full cost
recovery.
23. RSUs in each WSC will be involved in project implementation and will be trained under
the project on operation of the facilities financed by the project. This will ensure institutional
sustainability of the project.
8
V. Key Risks
24. The overall project risks are rated Medium - Impact and considered manageable with the
mitigation measures in place. Potential risks and mitigation measures are summarized in the
Operational Risk Assessment Framework (see Annex IV). The main risks are: (a) implementing
agency risks, which are rated High; and (d) delivery capacity risks, which are rated Medium –
Impact.
25. The principal mitigation measures include: (a) strengthening the HCWW PIU and
establishing RSUs in each project WSC with appropriate staffing; (b) provision of technical
assistance on project management, detailed designs and preparation of bid documents, and
construction supervision; (c) issue of a comprehensive Project Implementation Manual,
acceptable to the Bank; (d) provision of technical, procurement, financial management and
safeguards implementation training to relevant staff; and (e) regular confirmation with MOHUUD
on the timely provision of counterpart funding and operations and maintenance subsidies to the
WSCs in accordance with the Development Policy and the loan agreement.
26. The Bank task team will provide implementation support through regular half yearly
missions as well as through on-going as needed guidance and problem solving support. Country
office based staff will be utilized for key aspects of implementation support (technical,
procurement, financial management, environmental and social safeguards) to ensure speedy
response to project implementation issues.
VI. Appraisal Summary
A. Economic and Financial Analysis
Financial Analysis
27. Project WSCs. As discussed in paragraph 7, as part of the sector reform agenda,
HCWW was established in 2004 to provide rural and urban sanitation services, with WSCs as
subsidiary companies responsible for these activities in the respective governorates. The
Sharkeya and Menoufia WSCs are a little over five years old, while the Assiut and Sohag WSCs
are less than three years old. At the time of their establishment, the WSCs took over existing
assets (generally in poor condition) and staff from the governorates and MOHUUD. Under the
direction of HCWW these WSCs are now beginning to operate in a more commercial manner;
commercial accounting is now in place with standardized accounting software in use. Accounts
are audited annually.
28. Tariffs. Water and wastewater tariffs are set at the national level, and comprise tariffs
for four customer categories: domestic, economic (commercial and industrial), government and
institutions. The tariff for domestic customers includes a “social tariff” for the first 10 cubic
meters of consumption each month. Wastewater tariffs are a 35% surcharge on the water tariff.
The current tariff levels covered less than 60% of the 2009 operating costs; in Sohag the cost
recovery was as low as 29%.
9
29. Key Financial and Operational Results. Audited accounts for the year ended June 30,
2009 indicate that only Assiut achieved cost recovery under the „with grant‟ scenario; Sohag had
the lowest cost recovery of 64% with grants. The financial performance of the four project
WSCs is similar to that of nearly all WSCs in the country.
30. In terms of operational performance, the 2010 unaudited results indicate that there
continues to be scope for considerable operational improvement in all four WSCs, more so in the
case of the Upper Egypt WSCs of Assiut and Sohag. Three of the four WSCs have staffing
ratios of between five and seven staff per 1,000 water connections, while the ratio is in excess of
ten in the case of Assiut. Non-revenue water was less than 30% in two WSCs, while it was a
little over 35% in Sohag and even higher in Assiut. In general, collection of water and
wastewater bills had improved in some utilities: Assiut and Menoufia had arrears at around four
months‟ billing, while Sharkeya and Sohag still had arrears exceeding two years‟ billing.
31. Financial Sustainability. Government has confirmed that consistent with the policy to
achieve financial sustainability in the sector, it will provide each of the four project WSCs
subsidies/grants to:
(a) Meet operating cash shortfalls;
(b) Meet counterpart funding requirements for project implementation in a timely manner;
and
(c) Carry out replacement of existing assets which are required for acceptable functioning of
the system, but which are no longer functioning adequately.
This undertaking is set out in the Interagency Agreement executed among MOHUUD,
NOPWASD and HCWW. In addition, Government will provide the Bank, each year, the audited
financial statements for each WSC within six months of the end of each financial year. It will
also provide the Bank the annual budget for the current year for each WSC, within one month of
its approval.
32. Improvements in WSC Performance. HCWW monitors the performance of all WSCs
in the country on an on-going basis through a standard set of over 60 parameters. Each year,
Government will provide the Bank data on some of the more important indicators for each
project WSC, i.e., uncollected bills (arrears) in number of months‟ billing, staffing per 1,000
water connections, and the percentage of non-revenue water.
33. Financial rate of return (FIRR). Given the low tariff levels and poor financial results,
the FIRRs were not computed. As discussed below, the project is justified on economic
considerations.
Economic Analysis
34. Overall economic justification. The project addresses an important basic human need
of safe sanitation, as highlighted by the inclusion of sanitation in the Millennium Development
Goals. As highlighted in paragraph 5, only a limited percentage of villages have facilities for
safe sanitation. Safe disposal of wastewater in rural areas is a high priority for GoE, as
highlighted by the National Rural Sanitation Master Plan, which aims to provide comprehensive
10
sanitation coverage to the population of all rural Governorates by 2037. The project is consistent
with the Government‟s 2008 “National Rural Sanitation Strategy”, which seeks to prioritize
sector investments. It builds on the predecessor project (Integrated Sanitation and Sewerage
Project, Ln. 7512-EGT) and supports sector investments in priority Governorates identified by
Government.
35. Given the difficulties of quantifying the economic benefits in a reliable manner (see
paragraph below on Benefits), the economic analysis of the project is based on an overall
economic justification (see above) and a cost effectiveness approach, based on cost optimization,
as discussed in the subsequent paragraphs.
36. Options proposed and alternatives considered. The proposed investments are based on
the cluster approach adopted under ISSIP. Under the cluster approach, several villages are
equipped with shallow, small diameter simplified sewers and connected to a central treatment
plant. The size of each cluster and the location of the treatment plant are determined so as to
optimize the combined collection and treatment cost, with special attention paid to limiting the
number of canal and drain crossings which involve significant additional costs.
37. Alternatives to the proposed cluster approach include: (a) improved on site sanitation; (b)
use of decentralized treatment systems (such as the GIZ model); and (c) construction of
conventional sewer networks. Feasibility studies for the proposed clusters confirm that on site
sanitation is not a feasible option in the Project villages due to high population densities and high
groundwater levels. Based on bids received for the GIZ model pilots to be implemented as part
of ISSIP, as well as preliminary costing carried as part of ISSIP2 feasibility, the GIZ model,
which is land intensive due to the anaerobic nature of treatment required, appears to present
higher unit costs compared to the proposed cluster approach and has been excluded from the first
phase of ISSIP2. Possible use of the GIZ model will be reconsidered for ISSIP2 Phase 2 based
on lessons learned during first phase of implementation. Finally, conventional sewers were not
considered a viable option due to the higher investment costs and more complex operation and
maintenance requirements involved, as well as due to the constraint of high water tables in many
of the project villages, which would further challenge construction, operation and maintenance.
38. Costs. Based on lessons learned from the implementation of ISSIP (cf. para. 19) costs of
the proposed cluster-based investments were optimized by:
(a) Continuing the cluster approach adopted in ISSIP, whereby a treatment plant in an
optimal location serves the maximum number of villages;
(b) Connection of project-financed networks to existing pumping stations and wastewater
treatment plants to minimize costs and maximize coverage with existing resources; and
(c) Optimizing treatment costs by permitting the contractors to submit a technology selection
from a menu of treatment technologies appropriate for rural settings with flow rates in the
range of 1,000 m3/day to 30,000 m
3/day.
39. In addition, project implementation is being phased, so that experience of the first phase
(covering the investment program of the first two years) can be incorporated into the plans for
Phase 2. In a similar vein, implementation of decentralized systems has been deferred to Phase 2
11
to enable the lessons of experience under ISSIP in implementation of such systems to be
incorporated into ISSIP2.
40. Costs vary between clusters: they are high (in relation to the number of beneficiaries)
where the investments cover the entire spectrum from house connections, sewer networks,
pumping stations and treatment plants, as well as adverse topographical conditions; and they are
lower, where project investments in the cluster take advantage of unutilized treatment plant and
pumping station capacity, and have favorable topographical conditions. Costs are also affected
by the distances of individual villages from the “mother village” (see Technical below). In
addition, treatment costs are significantly higher, where higher technology treatment plants are
expected to be used (e.g., in Menoufia and in Sharkeya, as well as in some of the clusters in
Assiut).
41. Benefits. The principal expected benefits are: (a) the avoided direct negative impacts to
households associated with use of on-site systems (e.g. risk of flooding, cost and inconvenience
of septage removal); (b) health and environmental benefits (e.g., health hazards due to infiltration
of ground water with septage, and degradation of water quality in nearby canals and drains),
which could not be quantified so as to allow full cost-benefit analysis.
42. A rapid survey carried out by the Project preparation team provides an indicative range of
the costs associated with the current use of trenches as on-site sanitation systems. Information
provided by the households indicates that the operation of the current systems requires 2 to 4
haulings a month due to infiltration of groundwater in the trench, in addition to a desludging
once every three months. The reported expenses of households who use private operators for
hauling and desludging ranges from LE120 per month in the Delta governorates to LE150 per
month in the Upper Egypt governorates. Households which cannot afford to hire the services of
private companies have to carry out the emptying themselves, which involves significant health
risks. Negative direct impacts of the on-site systems currently used also include time spent by the
households and degradation of houses due to percolation of wastewater from the trenches.
43. Significant health and environmental benefits are also expected. The use of permeable
trenches to dispose of wastewater in areas with high groundwater levels directly leads to the
contamination of local groundwater resources and to the subsequent pollution of drains and
canals used for agriculture. In addition to this pollution through groundwater, canals and drains
are also directly contaminated due to the current practice of hauling and desludging of trenches
through the disposal of wastewater and sludge into drains and canals.
Technical
44. The project builds on the on-going ISSIP, which is the first large-scale effort to provide
networked rural sanitation services in Egypt. The design therefore presents an approach that is
tailored to serving a large number of small settlements, emphasizing intermediate and low cost
options. Planning and design criteria of the wastewater system will follow recognized
international standards, as well as local regulations and codes of practice.
12
45. Cluster approach. The planning and implementation methodology will build on the
cluster approach adopted under ISSIP. Each ISSIP2 cluster is centered around one treatment
plant located at an optimal central location to serve the maximum number of villages. In Upper
Egypt, one mother village per cluster is appropriate, whereas in the Delta the approach is often
one mother village for every two clusters.
46. Phased implementation. The project will be implemented in two phases. Phase I of the
project (investment program for the first two years) will consist of network connections and
wastewater treatment plants for a total of four clusters, one in each of the project Governorates.
Phase II will cover years 3 to 5, and will allow for incorporation of lessons learned from Phase I
implementation and adaptation of the final plan according to the results on the ground. This
includes: (a) inclusion of decentralized systems, if feasible; and (b) assessing the efficiency of
the adopted institutional setting and adjusting the allocation of works and funds among the
implementing agencies, if needed. Detailed network designs will be prepared for inclusion in
bidding documents.
47. Sewer networks. Sewers will be built as close as possible to houses to reduce connection
costs. Special efforts will be made to minimize the depth of sewers, as the groundwater table is
high, often less than two meters. During detailed design options such as shallow and small-bore
sewers will be considered where applicable.
48. Wastewater treatment. An output based approach will be adopted for design and
implementation of wastewater treatment plants and contractors will be required to submit a
technology selection based on a menu of appropriate technologies and detailed designs. It is
anticipated that in the Delta, where land is more limited, mechanical systems are likely to be
constructed; in Upper Egypt, where there are fewer land constraints, stabilization ponds are more
likely.
49. Construction supervision. As in the ongoing ISSIP, NOPWASD will finance the
construction supervision of all project infrastructure activities by contracting one construction
supervision firm in each project governorate.
B. Financial Management
50. NOPWASD and HCWW will be responsible for the financial management (FM) of the
respective activities of the project that will be implemented by them. HCWW will coordinate the
FM work in the four project WSCs, which will be responsible for the FM of project activities
implemented by them.
51. A financial management assessment was conducted for the WSCs of Sharkeya,
Menoufia, Assiut and Sohag to determine the adequacy of their financial management capacity
for the project. The capacity of NOPWASD was assessed during the 2007 appraisal of ISSIP,
and was updated based on its current performance in implementing ISSIP. The assessment
concluded that, with the implementation of agreed-upon actions, the proposed financial
management arrangements will satisfy the Bank‟s minimum requirements under OP/BP10.02.
13
52. The following actions will be taken to mitigate the risks identified in the FM assessment:
(a) a Project Implementation Manual (PIM), which will describe the roles and responsibilities of
the implementing agencies with respect to financial management, and is acceptable to the Bank,
will be adopted (45 days after the effective date); (b) a functioning computerized accounting and
reporting software will be installed (installation of the accounting software, acceptable to the
Bank, is a disbursement condition); and (c) provide training to WSC financial management staff
on Bank financial management requirements.
53. Disbursement of loan funds will be based on reimbursements or direct payments to
contractors and/or advances to designated accounts if opened by NOPWASD and HCWW.
NOPWASD will make funds available to HCWW on a grant basis to implement its affiliates‟
respective activities under ISSIP2.
C. Procurement
54. Procurement for the project will be carried out by NOPWASD and the four project
WSCs. A procurement capacity assessment (PCA) was carried out for NOPWASD at the time of
ISSIP appraisal in 2007. Annex III provides additional information on the risks identified and
the recommended mitigation measures.
53. A PCA was carried out for the WSCs of Sharkeya, Menoufia, Assiut and Sohag
Governorates. The principal risks identified were: (a) lack of procurement specialists with
experience of procurement in international donor financed projects; (b) lack of experience in the
procurement of output-based performance contracts; (c) lack of computerized systems; and (d)
bidding documents based on incomplete designs and without clear evaluation criteria.
54. Risk mitigation measures include: (a) preparation of a Project Implementation Manual
(PIM), listing procurement procedures in accordance with Bank Procurement Guidelines (45
days after effective date); (b) appointment of qualified procurement staff in the RSUs of the four
WSCs; (c) training of procurement staff on Bank procurement in the class room and on the job;
(d) appointment of consultants for project management, including procurement, at WSCs; and (e)
preparation of Standard Project Bidding Documents for National Competitive Bidding, taking
into account ISSIP experience.
55. An acceptable Procurement Plan has been furnished by the Borrower for the first 18
months of the project. This procurement plan will be updated annually (or as appropriate) to
reflect the latest project requirements.
D. Social
56. The overall social impact of the project is considered positive as it will improve access to
sanitation and sewerage services for residents of rural areas, many of whom are poor. The
project will have a direct positive impact on women and children in the target villages, as they
are the most affected by the poor sanitary conditions. It will also create employment and
business opportunities for the local population, especially unskilled labor, during the
construction phase.
14
57. OP/BP 4.12 Involuntary Resettlement has been triggered because some land acquisition
is expected; a Resettlement Policy Framework (RPF) has therefore been prepared. Negative
social impacts during construction are associated with temporary and/or permanent land
acquisition, temporary disturbances in circulation and access, noise, air quality (associated with
odor and pollution), and influx of temporary workers, while public health and safety issues are
important during post-construction operation. These impacts are in general limited and
considered manageable through the mitigation measures detailed in the Environmental and
Social Assessment Framework (ESAF) and the RPF.
E. Environment
58. The proposed project falls under World Bank Environmental Category B classification,
according to the Bank's Operational Policy OP 4.01 on Environmental Assessment. The project
will have major positive environmental impacts when sanitation/sewerage services are provided
to the village clusters. Negative impacts during construction and post-construction operation will
be addressed through a monitoring plan, consistent with national standards and good practice.
59. An Environmental and Social Management and Monitoring Framework (ESMMF)
prepared by the Borrower was appraised (as detailed designs had not yet been prepared) and
found to be consistent with Bank requirements. It includes mitigation measures, a monitoring
plan, and institutional aspects, and will be followed by site-specific scoped Environmental and
Social Impact Assessments (ESIAs) of the fully designed clusters before each of the two project
implementation phases.
60. Consultations and Disclosure. Consultations were held in the four project target
Governorates with the participation of key local stakeholders, including community members,
local authority leaders, community development associations, WSC staff, and government
authorities. In accordance with Bank policies, the ESAF and RPF were disclosed in Egypt (in
Cairo and in the project Governorates) and in the InfoShop on January 13, 2011, prior to
Appraisal and re-disclosed in-country on February 22, 2011 and in the InfoShop on February 28,
2011 and on April 14, 2011.
15
Annex I: Results Framework and Monitoring
Project Development Objective (PDO):
The Project Development Objective is to provide targeted populations in the Governorates of Menoufia, Sharkeya, Assiut and Sohag with increased
access to improved sanitation and sewerage services.
PDO Level
Results
Indicators* Core
Unit of
Measure Baseline
Cumulative Target Values** Frequency
Data Source/
Methodology
Resp. for
Data
Collection
Description
2012 2013 2014 2015 2016
Indicator One:
Increased number
of people in the
project areas
connected to
improved
sanitation and
sewerage
services.
„000
0 0
600 600 1,200 Annual Progress
Report
RSU/PIU
Indicator Two:
Number of
wastewater
treatment plants
meeting Egyptian
effluent treatment
standards.
# 0 0
0 10 15 15 Monthly Lab.
Reports
RSU/PIU BOD
DO
FC
TSS
Indicator Three:
Volume of
wastewater
treated
„000
m3/d
0 0 0 60 60 120 Annual Progress
Reports
RSU/PIU
16
Component 1: Wastewater infrastructure systems in Menoufia and Sharkeya
% of total number
of additional
working
wastewater
connections.
% 0 0
0 75 75 100 Six months Progress
Reports
RSU/
PIU
% of WWTPs
operating at 2016
design flow rate
% 0 n/a n/a n/a n/a 100 Six months Progress
Reports
RSU/
PIU
Total number of
pumping stations
constructed
# 0 0
8 21 32 43 Six months Progress
Reports
RSU/
PIU
Total kms of
sewerage
pipelines laid
kms 0 0
95 297 470 626 Six months Progress
Reports
RSU/
PIU
Component 2: Wastewater infrastructure systems in Assiut and Sohag
% of total number
of additional
working
wastewater
connections.
% 0 0
0 75 75 100 Six months Progress
Reports
RSU/
PIU
% of WWTPs
operating at 2016
design flow rate
% 0 n/a n/a n/a n/a 100 Six months Progress
Reports
RSU/
PIU
Total number of
pumping stations
constructed
# 0 0
11 25 32 38 Six months Progress
Reports
RSU/
PIU
17
Total kms of
sewerage
pipelines laid
kms 0 0
149 328 411 549 Six months Progress
Reports
RSU/
PIU
Component Three: Project Management
Works contracts
awarded
# 0 10 22 55 55 90 Six months Project
Progress
Reports
Progress
reports of
WSCs
% of ESMMF
training delivered
% 0 20 40 60 80 100 Six months Project
Progress
Reports
HCWW/
WSC
Number of
construction
supervision
contracts signed
for treatment
plants
# 0 4 4 4 4 4 Six months Project
Progress
Reports
RSU/WS
C
Number of
Project
Management and
Technical
Training Courses
Completed in PIU
and RSUs
# 0 0 20 40 50 60 Six months Project
Progress
Reports
RSU
18
Annex II: Detailed Project Description
1. ISSIP2 will be implemented in two contrasting parts of the country - Upper Egypt and
the Delta - which have significant differences in terms of overall development, climate and
topography, hydrology, and basic infrastructure, with Upper Egypt generally having more
adverse conditions. The project area falls within the Governorates of Assiut and Sohag in Upper
Egypt, and Menoufia and Sharkeya in the Delta, which together have a total population of about
18 million. The project area represents the first priority for sanitation services in the rural areas
of these Governorates, based on multi-criteria ranking undertaken as part of the feasibility study
and Governorate priorities. It covers 18 village clusters, with a total of about 76 villages and
hamlets, and a target population of about 1.2 million people.
2. The table below provides details of the population of each project Governorate, as well as
current rural sanitation coverage.
Population and Rural Sanitation Coverage4
Population
(million)
%
Rural
% Rural Sanitation
Coverage
Networked/On-site
Menoufia 3.3 75 0 / 90
Sharkeya 5.2 79 19 / 63
Assiut 3.8 70 0 / 80
Sohag 3.7 78 0 / 76
3. Networked rural sanitation coverage in both Assiut and Sohag is officially classified as
0%, while the corresponding coverage in Menoufia and Sharkeya in the Delta Region is 0% and
19% respectively. While most rural households in both Upper Egypt and the Delta Region have
latrines or flush toilets connected to infiltration trenches or septic tanks, most of the sewage is
discharged directly into nearby water canals and drains, leading to environmental and health
hazards in the vicinity. The comparatively higher poverty levels in Upper Egypt have also led to
worse health and hygiene conditions at both the community and household levels.
4. Project Components. The project comprises three components, as described below.
Component 1: Wastewater infrastructure systems in rural areas in Menoufia and Sharkeya
(Estimated cost US$149.75 million). Construction of wastewater infrastructure systems in
selected village clusters in the Governorates of Menoufia and Sharkeya, including wastewater
treatment plants, collection networks, customer connections, and decentralized treatment
systems. The initial scope of the component is about 36 villages in about 8 clusters;
decentralized treatment systems may be incorporated into the project design subject to their
being successfully piloted in ISSIP.
4 National Strategy for Water Supply and Sanitation: Compilation of Water and Sanitation Master Plans, HCWW report for the
European Commission, May 2009.
19
Component 2: Wastewater infrastructure systems in rural areas in Assiut and Sohag
(Estimated cost US$149.75 million). Construction of wastewater infrastructure systems in
selected village clusters in the Governorates of Assiut and Sohag, including wastewater
treatment plants, collection networks, customer connections, and decentralized treatment
systems. The initial scope of the component is about 40 villages in about 10 clusters;
decentralized treatment systems may be incorporated into the project design subject to their
being successfully piloted in ISSIP.
Component 3: Project Management (Estimated cost US$10 million). Support to HCWW and
NOPWASD in project implementation, monitoring and evaluation and management, including
construction supervision and environmental management services. This component will be
financed entirely out of counterpart funds. It will finance: (a) project management support,
including the costs of the HCWW PIU and the four RSUs, construction supervision consultants
to each WSC, focusing on construction quality and adherence to all aspects of the contract,
including technical, timeliness, safety aspects, environmental and social aspects, etc; (b)
implementation of the ESMMF, including training of environmental and social staff, preparing
ESIA for all phases of the project, water quality monitoring, and equipment purchase; (c)
training to the PIU and the RSUs on all aspects of project implementation, including
procurement and contract management, financial aspects of utility management, environmental
matters - e.g., laboratory testing, regulations - technical training - e.g., sludge handling,
hazardous materials, operating wastewater treatment equipment, pipe maintenance, and utility
management..
5. Table below summarizes the project scope, coverage, and outputs.
Project Scope, Coverage, and Outputs
Governorate Cluster Population
(2050)
Pumping
Stations
(units)
Networks &
Force Mains
(km)
New
WWTPs
Number of
Villages
Served
Menoufia
Tanbasha 95,853 7 65 1 5
Mit Berah 17,231 3 18 - 2
Danasour 64,365 4 45 1 4
Talia 94,175 5 62 1 5
Sharkeya
Derb
Negm 29,294 4 50 1 4
Zagzig 120,672 10 148 2 8
Faqus 102,292 6 137 1 4
Hihya 59,410 4 101 1 4
Sohag
Gerga 142,990 9 88 - 10
El.Baliana 66,981 3 73 - 3
Sohag 47,771 3 24 - 3
20
Tema 35,481 3 32 - 3
Tahta 48,738 4 46 1 4
Assiut
Dairoot 13,186 1 16 1 1
Qusiya1 7,950 1 14 1 1
Qusiya2 20,598 3 40 - 2
Al.Badary 59,403 3 63 1 3
Sidfa 94,237 5 91 1 6
Ghanayim 47,119 3 62 1 3
Total 19 1,167,746 81 1,175 14 75
6. Planning and implementation principles. The ISSIP2 planning and implementation
methodology will build on the cluster approach adopted under ISSIP. Each ISSIP2 cluster is
centered around one treatment plant located at an optimal central location to serve the maximum
number of villages. In Upper Egypt, one mother village per cluster is appropriate, whereas in the
Delta the approach is often one mother village for every two clusters. In general the average
distance between the selected villages and the central wastewater treatment plant in Upper Egypt
is also greater than in the Delta Region.
7. Most existing treatment facilities are oversized and are receiving wastewater only to
about half of their design capacity. Where feasible, therefore, the project envisages the
connection of project-financed networks to an existing Government financed WWTP. This will
minimize costs and maximize coverage with existing resources, e.g., in Sohag and Menoufia. In
other cases, treatment facilities will be designed such that they adequately treat wastewater flows
predicted for 2030, but can be easily expanded to treat wastewater flows predicted for 2050.
8. The project will be implemented in two phases. Phase I of the project (investment
program for the first two years) will consist of network connections and wastewater treatment
plants for a total of four clusters, one in each of the project Governorates. Phase II will cover
years 3 to 5, and will allow for incorporation of lessons learned from Phase I implementation and
adaptation of the final plans based on results on the ground. This includes: (a) inclusion of
decentralized systems, if feasible; and (b) assessing the efficiency of the adopted institutional
setting and adjusting the allocation of works and loan funds among the implementing agencies, if
needed. Detailed network designs will be prepared for inclusion in bidding documents, whereas
for wastewater treatment plants, a Design-Build approach will be adopted.
9. Technical standards. Planning and design criteria of the wastewater system will be
based on recognized international standards, as well as the local regulations and codes of
practice. These include, but are not limited to:
(a) The Egyptian Code of Practice for the Design and Construction of Water and Wastewater
Networks - Ministerial Decree No. 286 / 1990; and
(b) The Egyptian Code of Practice for Plumbing, 1993 - Ministerial Decree No. 359 /1990.
21
10. Sewer networks. Sewers will be built as close as possible to houses to reduce connection
costs. Special efforts will be made to minimize the depth of sewers, as the groundwater table is
high, often less than two meters. Options such as shallow and small-bore sewers will be
considered where applicable, during detailed design. The condominial system in Brazil will be
used as a reference for coupling low cost technical design with consumer demand management
to arrive at the best sewer routes and enhance community ownership.
11. The table below summarizes the key design parameters for sewers under the project.
These will be reconfirmed by the design engineers.
Parameter Current standard Comments and agreed modification if any Minimum Cover 600 mm 550 mm, based on an agreed depth to invert of 700 mm.
Minimum Slope 1 in 167 for 150 mm.
1 in 250 for 200 mm.
1 in 300 at critical lengths at the head of the system to minimize
pumping (to be verified during detailed sewer design).
Use of interceptors will be investigated to allow for flatter slopes.
Minimum diameter 200 mm 150 mm
100 mm for connections serving one household or one building
with up to 5 apartments.
12. Wastewater treatment. Various treatment technologies are suitable for rural settings
with flow rates in the range of 1,000 to 30,000 m3/day: stabilization ponds, oxidation ditches,
rotating biological contactors (RBCs), and advanced sequential batch reactors (SBRs).
Contractors will submit a technology selection for treatment plants, based on a menu of
appropriate technologies and detailed designs. It is anticipated that in the Delta, where land is
more limited, mechanical systems will be constructed; in Upper Egypt, where there are fewer
land constraints, stabilization ponds will be constructed.
22
Annex III: Implementation Arrangements
Project Administration Mechanisms
1. The project will be implemented through the coordinated efforts of six agencies: the
Holding Company for Water and Wastewater (HCWW) and its four subsidiary water and
sanitation companies (WSCs) in Assiut, Sohag, Menoufia, Sharkeya, as well as the National
Organization for Potable Water and Sanitary Drainage (NOPWASD). All of these agencies are
under the Minister of Housing, Utilities, and Urban Development (MOHUUD). As in the case of
ISSIP, the division of implementation responsibilities between NOPWASD and HCWW will be
detailed in an Interagency Agreement between the two institutions to be executed within 45 days
of loan effectiveness.
2. The Steering Committee for ISSIP, which is in place to provide coordination, oversight,
and direction to the project implementing agencies, will also be responsible for ISSIP2. It is
headed by the Minister of Housing, Utilities, and Urban Development or his designee, and
comprises representatives of all agencies which are directly involved in ISSIP implementation or
which have a legal or regulatory stake in the project. These agencies include:
HCWW, responsible for implementation of project contracts for sewer networks, pump
stations and force mains, and supervision of WSC operations.
EWRA, responsible for monitoring the quality and cost of public wastewater services and
advising the Minister of HUUD on tariffs.
NOPWASD, responsible for State Budget-funded planning and implementation of water
and wastewater treatment plants in Egypt‟s rural Governorates.
MWRI, responsible for monitoring canal and drain water quality and for setting and
enforcing effluent quality standards.
MOHP, responsible for sampling and testing drinking water and effluent from publicly-
owned treatment plants.
Representatives from the WSCs of Assiut, Sohag, Menoufia and Sharkeya and a representative
from the local council of each of the Governorates will be added to the Steering Committee.
3. The Bank Task Team Leader will participate in Steering Committee meetings as an
observer whenever necessary. Embassy representatives and representatives of related donor
projects in the project area may also be invited to attend meetings as circumstances warrant.
4. The HCWW Project Implementation Unit (PIU), which is responsible for ISSIP, will
have the same responsibilities for ISSIP2 as well. The PIU is headed by a PIU Manager, who is
supported by engineering, financial management, procurement and social/environmental
specialists who work closely with appropriate HCWW and WSC counterparts to manage ISSIP,
monitor progress and build capacity for rural sanitation programming. The PIU‟s current staffing
will be strengthened through additional procurement staff and an M & E specialist; an FM
specialist will also be added at a later date based on operational needs.
23
5. The HCWW will be responsible for the construction of pump stations, sewer networks
and force mains, and will, inter alia: prepare model tender documents and terms of reference for
consulting services; develop standard operating procedures and maintenance planning guidelines
for the various wastewater system components (such as treatment unit processes, pump stations,
sewers, force mains, sludge removal trucks); design cost accounting and billing system
improvements, etc. The PIU will also manage the preparation of the ISSIP2 Phase 2 investment
program, in coordination with the WSCs and NOPWASD, and under the guidance of the
Steering Committee. A Project Implementation Manual (PIM), acceptable to the Bank, detailing
the above procedures and processes, will be issued within 45 days of loan effectiveness.
6. The existing NOPWASD ISSIP Unit will also be responsible for the implementation of
all new ISSIP2 wastewater treatment plants. This unit is headed by a senior NOPWASD official,
and is supported by a team of specialists: a wastewater treatment project engineer, a procurement
officer, and a financial manager. This team of specialists will work closely with counterpart
NOPWASD staff.
7. A Rural Sanitation Unit (RSU) has been established in each of the four WSCs, with
responsibility for implementation of centralized wastewater collection systems, and for O&M of
the completed systems. The RSUs are headed by a Unit Head (Engineer) and will include a team
of six additional full-time dedicated specialists: social specialist; environmental specialist; M&E
specialist; procurement specialist; wastewater engineer; and financial management specialist.
Unit personnel will work closely with all counterpart WSC staff.
8. Local administrative units (LAUs), i.e., local village council units, which are the lowest
level in the local administration system in Egypt, will provide forums and venues for
engagement with local communities. The Social Specialist in the RSU will liaise with the local
authorities, village heads (omdas), and communities to ensure that customer concerns are
addressed.
ISSIP Steering Committee
HCWW PIU
Menoufia
WSC/RSU
Sharkeya
WSC/RSU
Assiut
WSC/RSU
Sohag
WSC/RSU
LAUs
NOPWASD
ISSIP Unit
24
Financial Management, Disbursement and Procurement
Financial Management
9. NOPWASD and HCWW will be responsible for the financial management of the respective
activities of the project that will be implemented by them. The four project WSCs will be
responsible for the financial management of project activities implemented by them, under the
overall guidance of HCWW. HCWW will be responsible for coordinating the FM work and for
consolidating the financial data.
10. A financial management assessment of the WSCs of Sharkeya, Menoufia, Assiut and
Sohag was conducted to identify the adequacy of their FM capacity. The financial management
assessment for NOPWASD built on the 2007 appraisal of ISSIP, taking into account
NOPWASD‟s current performance in implementing ISSIP.
11. The assessment identified the following FM risks for ISSIP2: (a) NOPWASD‟s inadequate
financial management system, which relies on manual recording systems; (b) WSCs‟ lack of
experience in implementing a Bank project, and hence their lack of familiarity with Bank FM
requirements; (c) lack of coordination between HCWW and NOPWASD; and (d) lack of
Government counterpart funds. The overall FM risk for the project, pre-mitigation, is therefore
rated high.
12. The following steps have been taken to mitigate FM-related risks to satisfy the Bank‟s
minimum requirements under OP/BP10.02:
(a) Inclusion of detailed FM policies and procedures, as well as roles and responsibilities of
all implementing entities, in the Project Implementation Manual, which should be
finalized within 45 days of loan effectiveness;
(b) A functioning computerized accounting and reporting software for NOPWASD that will
produce consolidated financial reports for all project components (this is a disbursement
condition for works); and
(c) Training will be provided to WSC financial management staff on Bank financial
management requirements.
In addition, it has been proposed that the ISSIP auditor be also engaged to audit ISSIP2 project
financial statements based on terms of reference acceptable to the Bank.
13. Budgeting. NOPWASD will be responsible for the overall budgeting and counterpart
funding arrangements for the project. As in the case of ISSIP, each project WSC will develop its
own budget and disbursement plan in accordance with the project procurement plan, forecasted
dates for activities, as well as completion and timing of payments. These will be consolidated at
the HCWW PIU level. The financial management team in each WSC will be responsible for
entering the cost estimates, along with the disbursement timeline, into the project accounting
information system. This information will be used to compare actual performance with estimates,
monitor deviations, and prepare periodic reports to management and to the Bank. Similar
25
arrangements (as in the case of ISSIP) will apply to NOPWASD for project activities
implemented by NOPWASD.
14. Accounting System. As in the case of ISSIP, NOPWASD will retain overall
responsibility for all project accounts. The accounting and reporting system developed under
ISSIP will be used to record ISSIP2 accounting transactions, both in NOPWASD and in the four
project WSCs. The system will link the WSCs with the HCWW PIU. NOPWASD and HCWW
have agreed to extend the application of ISSIP software to the four ISSIP2 WSCs.
15. Internal Control. Project internal controls include ex-ante and ex-post reviews on
project progress and the validity of payments through site engineers, supervision consultants, and
the HCWW review committee. Site engineers and supervision consultants will provide ex-ante
controls through the review of physical progress and approval of contractors‟ invoices/billing. In
addition, post reviews of network contracts will be conducted at the HCWW level through
review committees, which would include technical and financial representatives from HCWW
and NOPWASD.
16. The Project Implementation Manual will incorporate the FM arrangements under ISSIP2
which will include, inter alia: budget preparation procedures; the update of project disbursement
plans; accounting policies to be adopted; project chart of accounts, main accounting treatments,
procedures and steps for the flow of funds between NOPWASD, HCWW and WSCs;
management of the two designated accounts and the four WSC sub-accounts (signatories, criteria
for advances and replenishments, periodic reconciliation and reporting); filing system and
retention of supporting documents; and audit terms of reference tailored to the specific needs of
the project.
17. Financial Reporting. Each of the four project WSCs will prepare reports for their
respective parts of the project, which will then be consolidated at HCWW. The following table
summarizes the different required financial reports under the project:
Report Frequency Due Date By Sent to Language
Financial
Reports
Monthly 10 days from
end of month.
WSCs/RSUs Internally to
management
Arabic or
English
Interim
Financial
Report
Quarterly 45 days from
end of quarter
WSCs/RSUs
and HCWW
PIU
Bank through
HCWW
English
Project
Financial
Statement
Annually One month
from end of
fiscal year
(FY).
WSCs/RSUs
and HCWW
PIU
Bank through
HCWW
English
18. Project Audit. Annual audits for the project will be conducted by independent private
auditors acceptable to the Bank. To minimize cost, it is recommended that the same auditor will
cover all project parts implemented under both ISSIP and ISSIP2. The audit will be performed
for the project as a whole (i.e., all components and sources of funds). The audit report,
accompanied by a management letter, will cover the project‟s financial statements, reconciliation
26
and use of the DAs, use of direct payments, and withdrawal based on SOEs. The report should
be submitted by HCWW PIU to the Bank no later than six months following the closing of the
fiscal year (fiscal year July 1 to June 30). The external audit report should be in accordance with
Bank auditing requirements/TOR and in compliance with acceptable auditing standards. The
auditor‟s terms of reference will include field visits, with clear mandates to verify physical
progress, as well as a limited review of the quarterly project IFRs.
19. Continuing Entities’ Audits. Certified copies of the annual financial statements of
NOPWASD and HCWW and their respective audit reports (prepared by the Egyptian Central
Audit Organization) will be submitted to the World Bank within six months after the closing of
the fiscal year.
Disbursement Arrangements
20. Disbursement of ISSIP2 loan funds will be based on reimbursement or direct payments to
contractors/consultants and/or advances to designated accounts if opened by NOPWASD (the
legal counterpart entitled to receive the loan funds). NOPWASD will make funds available to
HCWW on a grant basis to implement its affiliates‟ respective activities.
21. Disbursement from the loan will only be made for civil works contracts. The loan will
disburse 67% (for Components 1 and 2) against the value of each contract, subject to a
consolidated ceiling of US$199.50 million.
Procurement
22. Procurement activities will be carried out by NOPWASD and the four WSCs.
NOPWASD is currently responsible for some of the procurement activities under ISSIP, which
are similar to its procurement responsibilities envisaged under ISSIP2. A Procurement Capacity
Assessment (PCA) was carried out for NOPWASD in 2007 prior to ISSIP appraisal.
23. A PCA for the WSCs of Assiut, Sohag, Sharkeya, and Menoufia determined that the
procurement risks to achieving the project development objectives are high; however, there is
some variability in procurement capacity between the four WSCs. The principal risks identified
were: (a) lack of procurement specialists with experience of procurement in international donor
and Bank projects; and (b) lack of computerized systems.
24. The principal risk mitigation measures that are being adopted include: (a) adoption of a
Project Implementation Manual (PIM), listing procurement procedures to be used, in accordance
with Bank Procurement Guidelines (within 45 days of loan effectiveness); (b) appointment of
qualified procurement staff in the RSUs of the four WSCs; (c) training of procurement staff on
Bank procurement in the class room and on the job (on-going); (d) appointment of consultants at
WSCs for project management, including procurement (project implementation); (e) preparation
of draft bidding documents by the Feasibility Study consultants (already in place) for wastewater
treatment plants; and (f) finalization of Standard Bidding Documents for National Competitive
Bidding, taking into account ISSIP experience.
27
25. Procurement for the proposed project will be carried out in accordance with the World
Bank‟s “Guidelines: Procurement under IBRD Loans and IDA Credits” dated May 2004 and
revised October 2006 and May 2010, as well as the provisions stipulated in the Legal
Agreement.
26. Procurement Plan. The project currently envisages use of loan funds for procurement
of about 90 civil works packages; there are no goods packages or consulting contracts financed
by the loan. The implementing agencies have prepared a Procurement Plan acceptable to the
Bank for the first 18 months of the project. The Procurement Plan will be updated at least
annually or as required to reflect project implementation needs and improvements in institutional
capacity. The Procurement Plan will be posted on the appropriate Bank‟s web page and the
project‟s website. Each WSC will prepare the first bid package by October 31, 2011.
27. Project Standard Bidding document (PSBD). All Works packages will be issued under
National Competitive Bidding process using the PSBD reviewed by and acceptable to the Bank.
A PSBD in Arabic will be prepared by NOPWASD for WWTP procurement contracts (as used
for ISSIP) and include lessons learned in ISSIP. Contractors will propose a treatment technology
and provide detailed designs for the WWTP. Similarly, another PSBD in Arabic will be prepared
by the HCWW PIU for use by the four WSCs for the network packages. This PSBD will also be
based on Bank‟s model document, which is currently used for ISSIP, and will incorporate
lessons from ISSIP. The standard bidding documents developed and agreed for ISSIP2 will be
used for all World Bank financed projects in the water and sanitation sector in Egypt.
28. Prior and Post-reviews. The prior review threshold for NCB civil works contracts will
be $5 million per package. However, the first three contracts from each WSC, irrespective of
value, will be subject to prior review. The post-review ratio will be one in five contracts.
Environmental and Social Aspects (Including Safeguards)
29. Environmental Impacts. As the potential environmental and social impacts of the
project are expected to be limited, short-lived, and reversible, the project has been classified as
Category “B”, which requires a partial assessment. As detailed designs were not available at
appraisal, a “framework” assessment was carried out. This will be followed by scoped and site-
specific Environment and Social Impact Assessments (ESIAs) before each phase of project
implementation. The ISSIP2 Environmental and Social Impact Assessment Framework (ESAF),
which is an update of the ISSIP ESAF (and which includes the updated ESMMF), is acceptable
to the Bank.
30. Social Impacts. Two social assessments were carried out as part of the Environmental
and Social Assessment Framework (ESAF) to reflect the geographical and cultural differences in
Upper Egypt (Sohag and Assiut) and the Delta Region (Menoufia and Sharkeya). The overall
social impact of the project is considered positive as it will improve access to sanitation and
sewerage services as well as improve environmental conditions in rural areas, where a substantial
number of poor people live. The project will have a direct positive impact on the livelihoods and
health of the populations in the target villages, particularly of women and children, who are the
most affected by the poor sanitary conditions.
28
31. Potential positive indirect socio-economic impacts of the project on the communities
include: (a) improved health conditions as a result of a cleaner environment; (b) improved
quality of life for the community; (c) improved maintenance of public buildings and homes
through elimination of wastewater overflows; (d) increased business opportunities in the project
area; and (e) employment opportunities for local labor.
32. Negative impacts of the project are associated with temporary and/or permanent land
acquisition, temporary disturbances in circulation and access, noise, air quality (associated with
odor and pollution), public health and safety issues during operation, and influx of temporary
workers. These impacts are in general limited and considered manageable through the
establishment of necessary mitigation measures as detailed in the ESAF and the RPF.
33. Land Acquisition. A Resettlement Policy Framework (RPF), acceptable to the Bank,
has been prepared to address potential involuntary land acquisition and resettlement issues since
the specific project sites are yet to be determined. The RPF: (a) documents the categorization of
project-affected persons (PAPs), eligibility criteria for compensation, methods for valuation and
delivery of entitlements to PAPs, grievance mechanisms, and the implementation and monitoring
processes; (b) includes measures to ensure that PAPs are informed about their options and rights;
and (c) offers alternative types of compensation that are in compliance with Bank policies.
Should resettlement become necessary once specific project sites are identified, resettlement
action plans, acceptable to the Bank, will prepared and implemented prior to commencement of
works.
34. Mitigating Measures for Environmental and Social Impacts. The ESAF includes an
Environmental and Social Management and Monitoring Framework (ESMMF), which proposes
a set of mitigation measures, monitoring plans, and institutional arrangements to mitigate the
potential negative environmental and social impacts during project implementation and
subsequent operation. It includes responsibilities for the implementation and supervision of the
plan, verification, monitoring and training requirements, record keeping and documentation
requirements, and provides proper grievance handling procedures as well as the level of funding
required for implementing the plan.
35. Cultural Heritage. Districts that possess archeological artifacts will require clearance
from the Ministry of Culture to proceed with construction. OP 4.11 Cultural Heritage is not
triggered, as the project does not involve construction in areas where there are known cultural
artifacts. All bid documents will include the “chance find” clause. In case cultural artifacts are
found, construction will come to an immediate halt and OP 4.11 will become applicable.
36. Community Participation and Public Consultations. Consultations were held in the
four target Governorates with the participation of key local stakeholders, including community
members, local authority leaders, community development associations, WSC staff, and
government authorities. In Upper Egypt consultations were held on November 8, 2010 in Assiut
and on November 9, 2010 in Sohag. Consultations in the Delta were held on December 30, 2010
in Sharkeya and November 22, 2010 in Menoufia. The dates of these consultations were
advertised in the local newspapers in advance to elicit participation. Consultations confirmed
the willingness of communities to participate and support the project. Issues raised included the
29
transparency of the village selection process and potential implementation delays. These were
addressed during the meetings and will be kept in mind during project implementation.
37. Disclosure. The ESAF and RPF were disclosed in Egypt (in Cairo and in the project
Governorates) and in the InfoShop on January 13, 2011 in accordance with Bank policies and re-
disclosed in-country on February 22, 2011 and on InfoShop on February 28, 2011 and on April
14, 2011.
38. Capacity for Safeguard Implementation. An Environmental and Social Specialist in
the PIU will be in charge of coordination, monitoring, and supervision of the ESMMF as well as
land acquisition and resettlement activities. The PIU will, in coordination with various direct
stakeholders, implement the capacity building and training program stipulated in the ESMMF.
30
Annex IV: Operational Risk Assessment Framework (ORAF)
Project Development Objective(s)
Description: The Project Development Objective is to provide targeted populations in the Governorates of Menoufia, Sharkeya,
Assiut and Sohag with increased access to improved sanitation and sewerage services.
PDO Level Results
Indicators: Increased number of people connected to improved sanitation and sewerage services in the project
Number of wastewater treatment plants meeting Egyptian effluent treatment standards
Volume of wastewater treated per day (m3/day)
Risk Category Risk Rating Risk Description Proposed Mitigation Measures
Project Stakeholder Risks
Stakeholder Risks
Low
Continued Government
commitment to the project.
Potential mis-alignment with the
programs of the many other donors
active in the sector.
Opposition from residents of the
project governorates, NGOs, and
civil society in general.
On-going high level sector dialogue
with key Government
ministries/agencies regarding the
sector and the project.
Continued frequent meetings with all
donors to exchange information as
well as conducting joint missions for
related operations.
Local consultations incorporated into
the planning and design process. Local
Administrative Units will be used for
consultation and engagement with
communities on an on-going basis.
31
Implementing Agency Risks
(Including FM & PR Risks)
High Weak technical, procurement
and FM capacity in WSCs.
Absence of continued senior
level Government commitment
to the project objectives and
scope.
Implementing a large
investment project by four
inexperienced WSCs provides
opportunities for fraud and
corruption.
Establishment of RSUs, with
qualified staff – technical,
procurement, and FM – in each
WSC.
Technical assistance for: project
preparation, including
preparation of bidding documents
based on detailed designs; project
management; and construction
supervision.
Inclusion of procurement and FM
policies and procedures in the
Project Implementation Manual.
Training of RSU staff on technical,
procurement, and FM aspects related
to the project.
Regular dialogue with key officials
in MOHUUD, NOPWASD and
HCWW, in particular when there are
changes in key senior staff.
Increased transparency through
disclosure of project information in
the HCWW website.
On-going guidance from Project
Management Consultants.
Effective internal and external audit
32
arrangements.
Effective supervision by Bank
fiduciary specialists.
Project Risks
Design Risk
Medium –
Likelihood
Inaccurate project costing
based on feasibility studies.
Different geographic terrains
(Upper Egypt and the Delta)
may affect design quality.
Project cost estimates will be based
on detailed engineering designs.
Preparation of feasibility studies and
detailed engineering designs based
on site specific requirements.
Safeguards Risk
Medium –
Likelihood
Lack of capacity to prepare an
acceptable ESMMF and ESIA,
and implement the management
and monitoring plan.
Project affected persons (PAPs)
may not be fully compensated
(as per OP 4.12) for land
acquired and/ or involuntary
resettlement.
Consultant support to prepare
safeguards documents
(environmental and social) to meet
Bank requirements and to monitor
implementation.
Environmental training for staff in
RSUs.
Regular supervision of safeguards
aspects during Bank missions and
guidance from Bank specialists on
an on-going basis, as required.
Program and Donor Risk
Low Potential conflicts with the
projects of other donors in
Assiut and Sohag.
On-going dialogue with the other
donors operating in the same
geographic areas as ISSIP2.
33
Delivery Quality Risk
Medium –
Impact
Inadequate funding for
Operation and Maintenance
(O&M).
Lack of managerial/technical
capacity for Operation and
Maintenance (O&M).
Inability to manage large
number of contracts effectively.
Confirmation from MOHUUD that
grants will be provided to the project
WSCs in accordance with the
Development Policy. Annual review
of, and dialogue on, O&M funding
status between Bank missions and
MOHUUD/HCWW.
Provision of technical and utility
management training by HCWW.
Support from Project Management
and Construction Supervision
consultants.
Supervision by Bank technical and
procurement staff.
Overall Risk: Preparation Risk Rating: Implementation Comments
Medium – Impact Medium – Impact This is a follow-on project to ISSIP. However, ISSIP has
recently begun implementation and the lessons are not yet
fully known. The project is underpinned by the sector
Development Policy, to whose development the Bank and
other donors contributed. The project addresses the needs of
priority areas identified by Government. Project Agencies
are fully committed to the project. However, ISSIP2 WSCs
have no experience of Bank projects.
34
Annex V: Implementation Support Plan
Strategy and Approach for Implementation Support
1. The strategy for implementation support has been developed based on the nature of the
project and its risk profile. It will aim at making implementation support to the client more
flexible and efficient, and will focus on implementation of the risk mitigation measures defined
in the ORAF for implementing agency risks (rated “high”) and delivery quality risk (rated
“medium-impact”).
2. Implementing Agency risks. Bank missions will confirm that the PIU and the RSUs are
fully staffed, with qualified technical, procurement and FM specialists and that appropriate
training in their respective fields of expertise has been provided, including refresher training,
where required. Missions will also review the staffing and the work of consultants supporting
the implementing agencies on project management, detailed engineering and design, construction
supervision, and environmental and social aspects. Bank technical specialists will confirm that
the detailed designs of sewer networks and wastewater treatment plants are technically sound
and are appropriately reflected in the bidding documents.
3. The Task Team Leader will maintain regular contact with key officials of MOHUUD,
NOPWASD, HCWW, and the WSCs to exchange views on strategic issues of project
implementation and address any critical issues, e.g., potential or actual non-compliance with
important project covenants.
4. Bank FM and procurement specialists will provide training to relevant PIU and RSU
staff before commencement of project implementation. They will review the efforts of HCWW
and NOPWAD in implementing financial management and procurement in accordance with the
PIM. In particular they will monitor disclosure of project information on the HCWW website,
the effectiveness of internal control arrangements to address possible fraud and corruption, and
review the auditor‟s reports regarding weaknesses in controls and cases of fraud and corruption.
The financial management specialist and the procurement specialist will both be based in the
country office to provide timely support. Supervision of financial management and procurement
will be carried out semi-annually as part of the project supervision plan and additional support
will be provided on an as needed basis in response to client needs.
5. The environment specialist and the social specialist will ensure that site specific ESIAs
and RAPs are prepared, consistent with the ESAF and the RPF, based on detailed designs, and
confirm that they are acceptable to the Bank. They will confirm that the required safeguard
staffing is in place at the PIU and the RSUs, and staff has been provided the requisite training to
carry out their responsibilities. They will make field visits on a semi-annual basis to ensure that
the ESMMF and the RAPs are being implemented in a satisfactory manner. The social and
environmental specialists will both be country office based.
6. Delivery Quality Risks. The Bank technical specialists will confirm that Project
Supervision consultants have adequate staff in place to review contract management, in
35
particular construction quality. They will conduct site visits, jointly with the PIU, the RSUs, and
the consultants, on a semi-annual basis throughout project implementation.
7. A financial specialist will conduct periodic (at least annual) reviews of the financial
status of the WSCs to assess their progress towards achieving financial sustainability and to
confirm that adequate subsidies are being provided as per the Development Policy and
agreements with the Bank. S/he will review financial matters with key officials of MOHUUD
and HCWW, in particular the timely provision of counterpart funding for the project and the
adequacy of subsidies for O&M.
8. Use of Country Office Based Staff. In order to ensure that the mitigation measures to
address the principal risks are being implemented in a satisfactory manner and to provide on-
going implementation support to the implementing agencies, key members of the Bank Task
Team (technical, procurement, financial management, environmental and social safeguards) will
be country office based staff.
Implementation Support Plan
9. Staff skill mix required is summarized below.
Skills Needed Number of Staff Weeks Number of Trips Comments
Water and Sanitation
Engineer
Six staff weeks (SWs) first
year, and two SWs
annually thereafter.
Two each year.
Process Engineer Six SWs first year, then
two SWs annually
thereafter.
Two each year.
Procurement Four SWs annually Fields trips as
required.
Country office-based
Monitoring and
Evaluation Specialist
Four SWs annually Fields trips as
required.
Social Specialist Four SWs annually Fields trips as
required.
Environment Specialist Four SWs annually Fields trips as
required.
Country office-based
Financial Management
Specialist
Two SWs annually Fields trips as
required.
Country office-based
Sector Financial Analyst Two SWs annually One per year.
Task Team Leader Six SWs annually Two each year.
36
Annex VI: Team Composition
World Bank staff and consultants who worked on the project:
Name Title Unit
Parameswaran Iyer Task Team Leader, Senior Water and
Sanitation Specialist MNSWA
Claire Kfouri Water and Sanitation Specialist MNSWA
T. Mpoy Kamulayi Lead Counsel LEGEM
Danielle Malek Roosa Senior Counsel LEGEM
Brenda Morata Paralegal LEGEM
Augustin Maria Economist SASDU
Maged Hamed Senior Environmental Specialist MNSEN
Mariana Felicio Social Development Specialist MNSSD
Badr Kamel Senior Procurement Specialist MNAPR
Hyacinth Brown Senior Finance Officer CTRFC
Akram El-Shorbagi Senior Financial Management Specialist MNAFM
Wael Elshabrawy Financial Management Specialist MNAFM
Raja Iyer Operation Adviser/Consultant MNSWA
Luz Maria Gonzalez Financial Analyst (Consultant) MNSWA
Heba Yaken Operations Analyst MNSWA
Zaileen Rahim Engineering Consultant MNSWA
Ahmed Atta Engineering Consultant MNSWA
Zakia Chummun Language Program Assistant MNSSD
Enas Mahmoud Program Assistant MNCO3
37
MAP SECTION
A L WA D IA L J A D I D
MARSA MATRUH
ASWAN
QENA
SOUTHERNSINAI
NORTHERNSINAI
SUEZ
HELWAN
G I Z A
AL BAHR
AL AHMARASSIUT
EL FAYOUM
BENI SUEF
AL MINYA
SOHAG
1
89
1011
1213
2
3
4
5
6 7
Luxor
Kom Ombo
Halaib
Marsa 'Alam
Salum
Siwa
Qara
Mut.
Quseir.
Bir Seiyala
Ras Gharib
Taba
Abu Zenima
Giza
Marsa Matruh
Qena
Suez
Helwan
Aswan
Sohag
Assiut
Benha
Tanta
Damietta
El Tur
Zagizig
Al Minya
Ismailia
Damanhur
El'Arish
El-Kharga
Beni Suef
El Fayoum
Port SaidEl Mansura
Alexandria
Al Ghurdaqah
Shibin el Kom
Kafr elSheikh
CAIRO
A L WA D IA L J A D I D
MARSA MATRUH
ASWAN
QENA
SOUTHERNSINAI
NORTHERNSINAI
SUEZ
HELWAN
G I Z A
AL BAHR
AL AHMARASSIUT
EL FAYOUM
BENI SUEF
AL MINYA
SOHAG
1
89
1011
1213
2
3
4
5
6 7
S U D A N
SAUDIARABIA
JORDANISRAEL
LIBYA
WEST BANKAND GAZA
Aswan Dam
Nile
River
LakeNasser
Gulf of Suez
Gul
f of
A
qaba
Red
Sea
M e d i t e r r a n e a n S e a To Tel Aviv
To Port SudanTo
BerberTo
Dongola
To Jalu
To Darnah
25°E 30°E
30°N
25°N
20°N
30°N
25°N
20°N
35°E
25°E 30°E 35°E
ARAB REPUBLICOF EGYPT
This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.
0 50 100 150
0 50 100 150 Miles
200 Kilometers
IBRD 38342
JANUARY 2011
ARAB REPUBLIC OF EGYPT
SECOND INTEGRATED SANITATION ANDSEWERAGE INFRASTRUCTURE PROJECT
PROJECT GOVERNORATES
SELECTED CITIES AND TOWNS
GOVERNORATE CAPITALS
NATIONAL CAPITAL
MAIN ROADS
RAILROADS
GOVERNORATE BOUNDARIES
INTERNATIONAL BOUNDARIES
GOVERNORATES IN NILE DELTA:
1234567
KAFR EL SHEIKHDAMIETTAPORT SAIDALEXANDRIABEHEIRAGHARBIYADAGAHLIYA
MENOUFIYASHARGIYAHQALIUBIYAISMAILIACAIROGIZA
89
10111213