DOCUMENT OF INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENTINTERNATIONAL DEVELOPMENT ASSOCIATION

Not For Public Use

FILE COPYRep3rt No. 76a-GN

APPRAISAL OF A

FIRST HIGHWAY PROJECT

GHANA

June 29, 1973

Western Africa Projects DepartmentTransportation Division

|This report was prepared for official use only by the Bank Group. It may not be published, quoted|or cited without Bank Group authorization. The Bank Group does not accept responsibility for theaccuracy or completeness of the report.

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Currency Equivalents

Ourrency Unit - Cedi (0)US$1.00 = g1.1501.00 . 100 pesewas01 million . US$870,000

Fiscal Year

July 1 - June 30

System of Weights and Nbasures: British/TUS

British/US Metric

1 foot (ft) a 0.305 motor (im)1 mile (mi) - 1.61 kilometers (kb)1 square mile (sq mi) - 2.59 square kilometers oaa2)1 ton (long ton) - 1.016 metric tons (m ton)

Abbreviations, and Acronym

ODA - Overseas Development Administration (UK)PWD - PUblic Works DepartmentSWUP- Scott, Wilson, Kirkpatrick and Partners (UK)vpd - vehicles per day

GHANA

APPRAISAL OF A FIRST HIGHWAY PROJECT

TABLE OF CONTENTS

Page No.

SUMMARY . ...... ............. *..*......**. iii

1. INTRODUCTION .................... 1

2. THE TRANSPORT SECTOR ................ 2

A. General................ 2B. The Transport System .............. ** 2C. Transport Policy and Coordination....... 4

3. TGMHWAYS ....... *. ....... ......*so 6

A. The Road Network and its Traffic 6............... 6B. Administration ........ .. ...... 7C. Recent Developments and Reorganization of FWD ... 8D. Financing ......... .. .................... 9E. Planning .............. I .... 10F. Engineering and Construction .................... 10G. Maintenance . ........... 11

4. THE PROJECT ............................. ........ 13

A. General Description ............ 13- Rehabilitation and Improvement of Trunk Roads . 13- Supervision of Construction ........ .... 14- Pre-Investment Studies for Future Rehabilita-

tion and Improvement Projects ................. 14- Formulation of Highway Maintenance Program .... 15- Equipment for Traffic Control and Pavement

Survey ..... *.... ..... 15B. Cost Estimates ... ... 15C. Execution........ 17D. Financing and Disbursement ........... 18

5. ECONOMIC EVALUATION. .. ... .19

6. AGREEMENTS REACHED AND RECOMMENDATION ................ 22

This report was initially prepared by "essrs. r. ". "ossberg (wngineer) andB. Shields (Economist) in January 1972, and was subsequenitly revised and up-dated by Mr. J. Doyen (Engineer/Economist, PMWA) following his re-appraisalmission in November 1972.

Table of Contents (Continued)

TABLES

1. Estimated Road and Rail Output, 19692. Estimates of Budgeted and Actual Highway Expenditures, 1968-723. List of Project Roads4. Cost Estimates and Financing Plan5. Estimated Schedule of Disbursements6. Economic Evaluation of Project Roads7. Savings in Vehicle Operating Costs

ANNEXES

I. Description of the Project RoadsII. Preinvestment Studies: Proposed List of Road Sections

PLATE Operating Costs (Financial) for Typical Vehicles at Various Speeds.

MAP Second Highway Project - IBRD 3691 RI.

GHA1NA

APPRAISAL OF A FIRST HIGHWAY PROJECT

SUMMARY

i. The national road network of Ghana was at one time probably thebest in West Africa. All essential sections have been built, and no majornew links are needed at this time. However, the roads have now deterioratedconsiderably because of poor maintenance, and because consitruction standards(particulariy for the pavements) were too low for present-day loads. Highwayinvestment over the next three or four years is therefore oxpected to concen-trace on restoring trunk roads and strengthlening maintenance; rehabilitationwork should be considered as particularly urgent so as to avoid future in-creases in vehicle operating costs and major reconstructioan.

ii. The Bank Group's first activity in the highway sector in Ghana wasan engineering Credit (S7-Gi, US$1.5 million, 1969) which helped finance thedesign of two highways between Accra and Kumasi, and between Kumasi andTakoradi; this design work was compl(tted in 1971. However, in view of theestimated cost of construction being higher, and the rates of traffic growthlower than expected, and because of improvements (proposed or underway) toexisting roads along the two corridors, the Government has taken the sounddecision to defer construction of the highways for some yetars.

iii. This report appraises a project for rehabilitation of about 345mi of roads on 13 sections located primarily in the south on main trafficroutes between the principal cities. The project is based on feasibilitystudies and engineering, following terms of reference prepared by the BankGroup, and undertaken by a British firm of consultants with financing by theGovernment of the United Kingdom (UK). The project also includes preparationof a program to improve highway maintenance, as well as pre-investeent studiesand engineering for further road rehabilitation.

iv. The cost of the project - including consulting services for con-struction supervision and for preparing programs for road maintenance andfurther rehabilitation - is estimated at US$19.5 million equivalent, with anestimated foreign exchange cost of about US$11 million, or 56%. The proposedCredit of US$13.0 million would finance the foreign exchange costs and about20% of the local costs of the project. Provision is made for retroactivefinancing of up to US$25,000 for the foreign cost of the services of consul-tants who would assist the Government in preparing a plan for implementationof the project, and in prequalifying contractors.

v. The project is technically and economically sound. The economicreturn of the different works ranges from 12% to 36%, with a weighted averagereturn of about 22%.

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vi. The project will be accompanied by the implementation of measuresagreed during negotiations for strengthening highway planning and for bettercontrol of road maintenance expenditures, as well as for improving weightcontrol of vehicles. The Government has also agreed to consult with theAssociation on implementation of the highway maintenance program to be preparedunder the project.

vii. Construction contracts will be awarded on the basis of internationalcompetitive bidding in accordance with Bank/IDA guidelines. Execution of theproject is expected to take four years, and will be the responsibility ofthe Public Works Department (PWD), assisted by the consultants who preparedthe engineering. The equipment will be procured following competitive bid-ding in accordance with Bank/IDA guidelines.

viii. The project is suitable for a Credit of US$13 million equivalentto the Government of Ghana on conventional IDA terms.

GHANA

APPRAISAL OF

A FIRST HIGHWAY PROJECT

1. INTRODUCTION

1.01 Bank Group missions to Ghana in 1969 and 1970 identified the mainproblem in the transport sector as the need to restore to serviceable condi-tion many badly deteriorated sections of trunk roads. The Government usedfinancial assIstance provided by the Overseas Development Administration(ODA, UK) to retain consultants Scott, Wilson, Kirkpatrick and Partners(SWKP, UK) who undertook economic and engineering studies of about 2,100 miof trunk roads, following terms of reference prepared by the Bank Group.The consultants recommended a high priority rehabilitation and improvementprogram covering about 750 mi of these roads, and prepared engieering andcontract documents.

1.02 In October/November 1971, the Bank Group used the SWKP study as abasis in appraising a project for rehabilitation and improvement of 20 roadsections totalling about 580 mi. With the change of governtment in Ghana inearly 1972, processing of the proposed project was deferred until the invest-ment policy for highways was redefined, and until the country's economicsituation was determined. In September 1972, the Government requested thatthe project be reactivated, and submitted a revised list of about 500 miof roads which it wished the Association to consider financing. The proposedrevisions in the scope of the project and changes in cost estimates neces-sitated re-appraisal of the project in November 1972.

1.03 The revised project now proposed consists of rehabilitation of 13high priority sections of trunk roads (totalling about 345 mi), consultingservices for construction supervision and for formulating a program to improveroad maintenance, and procurement of equipment for traffic control and pave-ment survey. The project also provides for economic and engineering studiesfor further rehabilitation of trunk roads. Most of the proposed road worksare on routes which serve the densely populated south of the country, notablyon the Accra-Kumasi and Accra-Takoradi highways, Ghana's most important trans-port corridors.

1.04 The project is estimated to cost about US$19.5 million equivalent,of which the foreign exchange cost would be about US$11 million, or 56%. Theproposed Credit of US$13 million would finance the entire foreign exchangecomponent, plus about 20% of the local costs of the project; the Governmentwill provide the remaining local costs.

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1.05 An engineering Credit (S7-GH) of US$1.5 million equivalent made bythe Association in 1969 helped finance detailed design of the new Accra-Kumasiand Takoradi-Kumasi highways, The design work was completed in 1971, butconstruction of the highways will be deferred for some years because estimatedcosts of construction are higher and traffic growth rates lower than estimatedin the feasibility study. Considering also the improvements to existing roadsalong these corridors -- some made recently and some included in the presentproject -- construction of the new highways is not warranted at this time.

1.06 This report is based on the abovementioned SWKP studies (para.1.01), on the findings of the initial appraisal mission of October/November1971 comprising Messrs. P.E. Fossberg (Engineer) and B. Shields (Economist),and on those of the re-appraisal mission of November 1972 by Messrs. J.H.Doyen (Engineer/Economist, PHWA) and R. Viapree (Highway Consultant, SWKP).

2. THE TRANSPORT SECTOR

A. General

2.01 With an area of just over 92,000 sq mi, the Republic of Ghana isabout the size of Great Britain. In the main, the topography is flat orrolling, and presents no major obstacles to transport. High forest in thesouth-west and poor road-making soils make road construction there expensive.Economic activities and population are concentrated in the southern third ofthe country where mineral deposits, timber stands, and cocoa plantations arelocated. The population of Ghana is just tinder nine million, and currentlygrowing at about 3% p,a. Annual per capita income is about US$260, the samein constant terms as in 1960.

B. The Transport System

2,02 The Bank Group's present knowledge of transport in Ghana derivesmostly from the Transport Sector Study carried out during 1969-70 by theconsultants Robert R. Nathan Associates, Inc. (US) with financing from theUnited States Agency for International Development (USAID). The NathanStudy was a general exercise which considered all transport modes from theaspects of coordination, management, investment priorities, and budgeting.It did not attempt to assess priorities in road maintenance and improvement,organization and staffing of PWD, and its needs for plant and equipment.To help do this, the Government of Ghana, with financial assistance from theUK, engaged consultants SWKP to undertake a study of highway rehabilitationwhich has led to the present project; at the same time, the Crown Agents (UK)were commissioned to carry out a study of highway maintenance.

2.03 Transport infrastructure is generally adequate to support a muchhigher level of economic activity than at present, but considerable renova-tion must be effected, and a greater maintenance effort applied. Highwaysrepresent the most important mode, accounting for about 70% of total freighttransport, and 90% of passenger movements (Table 1). Railways are used

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almost exclusively for transporting timber, cocoa, and mineral ores. Internalair transport accounts for probably less than one percent of total passengermovements. Coastal shipping and river transport are negligible, and VoltaLake transport is of only local significance.

Highways

2.04 Highway infrastructure and administration, as well as the char-acteristics of the road transport industry, are discussed in Chapter 3.

Railways

2.05 Railways in Ghana are run by the semi-autonomous Ghana Railwayand Ports Corporation, which is responsible to the Minisitry of Transportand Communications. The railway network is about 800 mi including 592 mi ofmain line, all but 19 mi being single-track. The network is essentially atriangle connecting Ghana's three main cities - Accra, ]Kumasi, and Takoradi- with several branches to mines and to the port of Tema. The longest haulpossible is about 200 mi; the average freight haul is 1210 mi, and the averagepassenger journey 40 mi. The physical plant, particularly rolling stock,track, and signalling and telecommunications equipment, is aging and generallyin poor condition.

2.06 The railway is specialized, and four commodities - timber, cocoa,manganese ore, and bauxite - constitute 93% of its traffic, of which almostone-half is timber transport. Eighty percent of the railway traffic goes tothe port of Takoradi for export. Over the last few years, both freight andpassenger traffic have fluctuated considerably. Trends for the period 1964-71show that passenger traffic increased at an average of more than 6% perannum, but that freight traffic stagnated as a result both of depressedeconomic conditions and loss of traffic to road transport.

2.07 The real price of both rail freight and passenger movement declinedover the sixties because tariffs were not raised to match changes in the costof living. However, some freight traffic, especially cocoa, is charged farmore than the full cost of movement, while passenger services have beenheavily subsidized. In July 1971, railway tariffs and fares were raised by25%, the first increase since 1958. Financial results have deteriorated since1966, and the annual deficit has reached about 05 million. The railway'sreserves, about 030 million only three years ago, are being rapidly depleted.in spite of declining revenues and traffic volumes, however, the railway'slabor force has been growing at 5% per annum since 1965, and is now almost12,000.

2.08 The 1971-75 railway plan focusses heavily on track rehabilitationand rolling stock replacement as recommended in various recent analyses.Recent motive power acquisition and the planned rehabil:Ltation program shouldenable the railways to reverse the deterioration in services. The structure

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of the rail network and the prohibitive cost of a complete realignment pro-gram will, however, limit what can be achieved to reduce operating costs byinvestment. The railway has retained since 1972 the services of a group ofexperts provided by Transmark (oonsultant agency of the British Railways)to assist in implementing rationalization measures and in preparing a newinvestment plan. The railway can be made viable by a program for ration-alization of services which would concentrate on freight traffic, closingdown stations which have lost traffic to the improved road system, reducingstaff levels, and improving management and operation control.

Ports

2.09 Ghana has two major ports, Takoradi and Tema, which together handleabout 5 million tons of goods per year. Almost all of the country's bulkexports, such as bauxite, manganese and timber, are shipped through Takoradi,while Tema receives most of Ghana's imports. Tema is a fairly new and modernport, but Takoradi port is over 40 years old. Both are well connected by roadand rail to their hinterland, and no port extension is required in the fore-seeable future, except for the development of fishing ports.

Inland Waterways

2.10 Ghana's rivers, important before the development of the road andrail systems, now carry negligible traffic. The man-made Volta Lake createdby construction of the Bank-financed Volta Dam, has severed main road links,thus causing problems of north-south movement in the country, and of commu-nication for communities surrounding the Lake. The Volta River Authorityruns a limited boat service on the Lake. Several more ambitious schemes havebeen advanced for providing lake transport services, but these have allfoundered for lack of demand. The population centers served by the Lake arescattered and competitive rather than complementary, and there is littletraffic between them.

Air Transport

2.11 The Department of Civil Aviation of the Ministry of Transport andCommunications is responsible for maintaining and operating dr fields; main-tenance of runways is delegated to PWD. Only the international airport atAccra can accommodate long-distance jets; the airports at Kumasi, Temale,and Takoradi have adequate facilities for medium-sized two-engine turbo propaircraft. These are the only airports used by scheduled carriers, and theircapacity is more than enough for present traffic.

C. Transport Policy and Coordination

Institutional Responsibilities

2.12 Transport organization and planning involves several Governmentdepartments and agencies. The Ministry of Transport and Communications isin charge of transport policy and regulations, and controls the agencies (theRailway and Ports Administration, and the Department of Civil Aviation) andthe various state-owned corporations which supply transport services. The

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Omnibus Services Authority is responsible for inter-city bus transport, andreports to the Ministry of Local Administration; the Volta River Authorityreports directly to the Prime Minister's Office. The PubLic Works Department(PWD) of the Ministry of Works and Housing has charge of the trunk road net-work; responsibility for feeder roads and local roads is shared between PWD,the Ministry of Social Welfare and Rural Development, and local councils.The Government is planning to coordinate the responsibililty for trunk andfeeder roads at the regional level under PWD, and to reoriganize the department'shead office to enable the efficient handling of this new function (para. 3.09).

Coordination and Planning

2.13 Transport planning is weak at all levels, and suffers from lackof coordination among the various Government agencies and departments. Farmore economic analysis is required in the decision-making process. None ofthe agencies mentioned above (para. 2.12) keeps up-to-date financial andstatistical information on its activities. The Infrastructure and PlanningDivision in the Ministry of Finance and Planning screens budget requestsfor transport infrastructure, but lacks the capacity for project evalua-tion. As recommended by the Nathan Study (para. 2.02), a Transport Planningand Budget Division was created in the Ministry of Transport and Coumunica-tions, and is expected in the future to screen budget requests for agenciesresponsible to the Ministry. This new Division also provides_the secretariatfor a newly created Transport Planning Comittee, one of several sectoral _ -planning comittees established to assist in preparing a new five-year plan.In order to overcome the lack of trained personnel, the Division has initi-ated a program to send staff abroad for post-graduate training. A seniortransport adviner provided by the Canadian International Development Agency(CIDA) will head the Division over a two-year period, penLding the avail-ability of qualified Ghanaian staff. The Government has agreed at negotia-tions that it will improve highway planning under the proposed project(paras. 3.09 and 3.15).

2.14 The new Government has not yet formulated an explicit transportpolicy, but it has acknowledged that the main problems are restoration andbetter maintenance of the existing infrastructure. The budget estimates for1972/73 and its accompanying statement reflect the high priority given torehabilitation and to improved maintenance of existing trunk and feeder roads,as well as the emphasis placed on satisfying transport re!quirements directlyrelated to agricultural development. The Government has also indicated itsintention to improve railway operations, as well as to achieve a sound finan-cial policy for the various state corporations engaged iTn transport (para.2.12). Steps are also being taken to encourage investmenit in commercialpassenger transport rather than in private cars (para. 3.02).

2.15 The planning situation should improve markedly in the near futureas a result of recent and prospective developments described above. However,there have been several instances in the past of investment decisions beingtaken in spite of economic analysis demonstrating the low priority of certainprojects. It is hoped that Government will soon begin to follow its declaredintention to investigate the economic and technical feasibility of all majorinvestment orojects, and to evaluate their Justification in relation to Ghanat.

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development objectives. This question was discussed at negotiations, and theGovernment agreed that the PWD Planning Unit would in future submit to suchan evaluation highway projects which are of major importance (i.e. projectsexpected to cost about C 300,000 (US$260,000) or more).

3. HIGHWAYS

A. The Road Network and Its Traffic

3.01 The road network in Ghana totals about 20,000 mi, of which about2,600 mi are paved and 6,300 mi gravel or laterite surfaced; the remainderare earth roads. The rather extensive trunk road system has been built overthe past 20 years at low cost to standards adequate for that time; but manyroads have now reached the end of their service life, are structurally defi-cient for present traffic, and require increasing maintenance and rehabilita-tion. No major expansion of the trunk road network is required for severalyears, but rehabilitation at this time is important to avoid future increasesin vehicle operating costs and major reconstruction. There is, however, acontinuing need for expanding the feeder road system to support the develop-ment of agricultural production. To meet this priority, the Government hasover the past few years made considerable investments through the NationalFeeder Road Program; since 1966, more than 2,000 mi of these roads have beenconstructed or improved.

3.02 Statistics on fuel consumption and available information on thevehicle population indicate that, over the past decade, motor vehicle traf-fic grew only slowly at about 3-4% per annum. The expected low rate of growthof the economy would suggest that this trend will persist at least over thenext five years. The motor vehicle fleet now numbers about 56,000 units,of which about 50% are private cars and about 30% trucks (including thetypically Ghanaian "mammy wagons" used for combined goods and passengertransport); the rest are buses and special purpose vehicles. The proportionof public conveyance vehicles has increased over the last two years followingrestrictions imposed on the importation of private cars, and purchases ofbuses by the Government.

3.03 Traffic volumes in the country are generally low: the highest levelsare reached in the Accra-Kumasi-Takoradi area (Golden Triangle) where figuresof 1,000 to 3,500 vehicles per day (vpd) have been recorded. Only 10% ofPWD's network (about 600 mi) carries more than 600 vpd, and practically noroad outside the main interurban routes in the south of the country carriesmore than 350 vpd. The Nathan Study showed that although much of the trunkroad network is paved, road user costs in Ghana are still quite high; thisis attributable mainly to the considerable deterioration of the condition ofthe network.

3.04 Most goods vehicles are of five-ton payload capacity, but there isa tendency toward heavier vehicles. The Road Traffic Regulations introducedin December 1970 provided for revision of the then 9-ton limit on axle load.The maximum gross weight now permitted for any motor vehicle or trailer is16 tons, for vehicles on three axles 22 tons, and for those on more thanthree axels, 28 tons; for articulated vehicles, the maximum on three axles

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is 24 tons, and on four or more axles, 32 tons. The new regulations do notspecify maximum permissible axle loads, and under the above overall weightlimitations, these may reach 12 tons on single axle and 20 tons on tandemaxles, levels which are clearly excessive for Ghana's present highwaysystem. The problem of vehicle weight limitation was reviewed during nego-tiations, and the Government agreed tbat: (i) the existing vehicle weightregulation would be supplemented by a provision to impose a reasonable limiton axle loading - 10 tons for single axle would be adequate; and (ii) mea-sures will be taken to assure implementation of these regulations. Weighingscales will be provided under the project to assist in the enforcement ofweight limit regulations (para. 4.10).

B. Administration

3.05 The highvay network can be divided into three categories, accord-ing to the importance of the roads and the agencies responsible for theirconstruction and maintenance, as follows: (i) trunk roads; (ii) secondaryand feeder 1/roads; and (iii) local roads. PWD is in charge of trunk roads(totalling about 6,300 mi, of which about 2,600 mi are paved), the onlycategory for which responsibilities are clearly defined, arnd which receivecontinuing attention. Secondary and feeder roads (about 7,000 mi) are theconcern of regional authorities, the Department of Social Welfare and RuralDevelopment 2/, and local councils. Some lesser responsibi.lity for secondaryroads is also assigned to the following agencies: The Ministries of Agricultureand of Forestry, the Volta River Authority, the Cocoa Marketing Board, andprivate timber companies. Local roads are mostly unimprovet tracks and villageroads.

3.06 Although other agencies are involved in administering the roadnetwork, PWD is clearly the controlling body. Until three years ago, theorganization of the Department followed the classic pattern of centralization:a strong Head Office which included the usual departments for engineering,construction, maintenance, and administration; and a pyram:Ldal field orga-nization of regional and district offices. The regional offices carriedout the annual maintenance program, and were responsible for execution ofsmall projects; larger projects were the responsibility of Headquarters.PWD's administrative structure was satisfactory, but its capacity was seri-ously hindered by a shortage of qualified personnel at all levels.

1/ In the context of Ghana, the designation "feeder road' applies in astrict sense to roads built under the National Feeder Road Program(para. 3.01), and more generally to all secondary roads serving areasof agricultural production.

2/ Formerly the Ministry of Youth and Rural Development.

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C. Recent Develozments and Reorganization of PWD

3.07 In 1969, the Government undertook to decentralize several agencies,

among them PWD. The Dpartment's nine regional offices, each headed by an

engineer, were strengthened and given some autonomy; regional engineers were

placed administratively under the Regional Chief Executive, but were expected

to take technical advice from PWD Headquarters. Proper control of expendi-tures by PWD Headquarters was difficult since funds are channeled through the

Regional Administration. Generally speaking, the decentralization as proposed

had no clearly defined objectives. Feeder roads suffered particularly from

this situation, as responsibility for their construction and maintenance was

assigned to various agencies which did not necessarily have the required com-

petence or capacity.

3.08 While the feeder road program was underway, the Government also

allocated in 1969/70 increased amounts for maintenance and rehabilitation

of the deteriorating trunk road network. Overall, however, results were

disappointing, and did not reflect the amount of money expended. PWD lacked

the staff and equipment neccessary for much of the deferred maintenance on

the trunk roads, and had to resort increasingly to using small local contractors

who operated without enough technical and financial control. For the feeder

road program, too, the problems were the same; some of the roads, inadequately

maintained to withstand heavy rains and flooding, were washed away within two

or three years of construction.

3.09 The new military Government which came to power in January 1972 is

anxious to see the large allocations for highways used effectively, and has

undertaken extensive reorganization of PWD. The main lines of thrust of the

reorganization now underway are: (i) continuing the decentralization policy,

and regrouping all highway responsibilities within each region under the PWD

regional office; (ii) establishing the present Engineering Department of PWD

as an autonomous National Consultancy Corporation; and (iii)concentrating

PWD activities on the planning, construction, and maintenance of highways,

and divesting the Department of most of its non-highway responsibilities

(building maintenance, housing, hydrology, etc.). The Government is consider-

ing as a long-range plan the establishment of PWD as an autonomous Highway

Authority.

3.10 The proposed reorganization would lead to a strengthening of PWD's

role in highways, and as such, it appears to be a move in the right direction.

It is not yet possible, however, to assess with any certainty the impact it

would have on the Government's capacity to plan the road network, and to build

and maintain it adequately. During execution of the proposed project, the

Association will review the soundness of the new organizational arrangements,

and will consult with the Government on apparent deficiencies and possible

corrective measures. In this respect, particular attention will be paid to:

(i) improving the planning and supervision of highway investment; (ii) clari-

fying the allocation of responsibilities for secondary and feeder roads;

(iii) maintaining sufficient central authority to coordinate and supervise

highway maintenance and plant management; and (iv) exercising sufficient

financial and technical control over the regions' highway maintenance opera-

tions,

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3.11 PWD's operations are hindered by a serious shortage of qualified

personnel at all levels. The professional staff establishment is about 300,of which more than a third of the posts are vacant. The main reasons for thisshortage are the short supply of engineers and technicians, and the fact thatsalaries offered by FWD compare poorly with those outside the public sector.Aware of thig, the Government has undertaken, as part of the reorganizationof FWD, a review of the general policy concerning working conditions and com-pensation for engineers and other technical staff. 1/ In order to allow PWDand other Government departments to retain qualified and experienced staff, theGovernment has directed the Income Commission to set reasonable limits on thepossible disparity between compensation offered to Government personnel, andthat offered by other public sector employers, e.g. state corporations andautonomous agencies.

D. Financing

3.12 Funds for highway purposes are met mainly from the central Govern-ment budget. For pre-investment studies, larger construction projects, andfor central workshop and equipment purchases, funds are allocated to thePWD central administration; for small projects and for maintenance work,allocation is direct to the regional administrations. Funds for the feederroad program have until now been administered by various agencies, but as thePWD regional offices take over this responsibility, future allocations willbe made to them. Budgeting procedures appear acceptable, but control ofexpenditures, especially for maintenance, has been inadequate, and is furtneraggravated by the regionalization.

3.13 To accommodate the priority given to maintenance and rehabilitationand to feeder roads, budget allocations for highways have increased substan-tially over the past few years from a low ¢ 8.5 million in 1968/69 to aboutC 30 million at present (Table 2). For maintenance alone, the allocation wasraised from about ¢ 2.1 million in 1968/69 to roughly C 10.5 million in 1969/70,and to about 0 16 million in 1972/73. Actual expenditures were approxi-mately as budgeted, except in 1971/72 when they were only about 70% of theunrealistically high budgeted allocation.

3.14 Taxes on vehicle ownership and use are levied mainly through importduties, purchase and sales taxes on equipment, fuel, spares, etc., and regis-tration fees. A new regulation which came into effect in January 1973

1/ There are now about 300 Ghanaian civil engineers, and an annual additionof about 20-30. Although these figures are high in comparison with otherAfrican countries, civil engineers remain in short supply.

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requires that all vehicles have a roadworthiness certificate, the fixed feefor which includes an element of taxation similar to the license fee abol-ished in July 1971. Road user charges have in the past considerably exceededthe amounts spent on highways, especia:Lly during the period 1963-68 when re-venues more than doubled expenditures. The recent increase in road invest-ment, combined with declining revenues, has narrowed this gap, and a balancewas achieved in 1970/71. This situation is likely to prevail over the nextfew years.

E. Planning

3.15 The highway planning normally undertaken by PWD has been insuf-ficient for the substantial increase in highway operations over the past threeyears (para. 3.13). The "Ghana Highway Study Unit" established within PWDHeadquarters to follow the recent highway rehabilitation and maintenancestudies (para. 1.01) can form the nucleus of a planning group. This unitwill be strengthened under the project, and will be made responsible for plan-ning highway expenditures, establishing and maintaining an inventory of allroads administered by NWD, and collecting and analyzing regularly the informa-tion necessary to follow development of the road network and of its traffic.The specific responsibilities of the PWD Planning Unit, and the deadline forits full establishment (July 31, 1974) were agreed upon during negotiations.The Government has requested CIDA to provide two experts for a period ofabout two years to assist the PWD Planning Unit; CIDA is reported to be con-sidering this request favorably. In connection with transport planning, theGovernment also agreed to complete an inventory of all PWD-administered roads,and to keep it up-to-date in the future.

3.16 The 1972/73 budget reflects the continuing emphasis on maintenanceand rehabilitation of trunk roads. Government policy in respect of feederroads is to stress maintenance of existing ones, and to slow down new construc-tion. At the suggestion of the Bank Group, the Government has commissionedthe Building and Road Research Institute (BRRI) at the University of Sciencesand Technology at Kumasi to undertake a study of future requirements formaintenance and construction of feeder roads. The findings of this studywould be used as a basis to formulate a highway maintenance program as pro-posed under the project (paras. 4.08 and 4.09), and to define the feeder roadrequirements for planned agricultural development projects in rice and oil-palm production which are now under consideration by the Association.

F. Engineering and Construction

3.17 Pre-investment studies for major highway projects are normally doneby international consultants, the notable exception being the feeder roadstudies undertaken by BRRI (para 3.16). In line with its policy of self-reliance, the Government is anxious to develop a local consulting organiza-tion which can handle large projects, and hopes that the proposed NationalConsultancy Corporation will satisfy this need. The Government does recog-nize, however, that specialized foreign expertise will be required for someyears to carry out the feasibility studies, engineering, and supervision ofmajor highway projects.

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3.18 The design of smaller road projects has been undertaken by localconsulting firms established mainly in structural engineering, and whosecapacity is limited at present to the simplest aspects of highway engineer-ing. These firms have also provided field supervision of small- and medium-sized construction contracts, notably for feeder roads, but the experiencein this field has been disappointing. Generally, the Government has notworked towards grooming this infant industry. Selection cif consultants isnot always related to their past performance, and PWD has in several instancesbeen lax in supervising them and in providing the necessary guidance andtechnical quality control. Following the discussions on this matter heldduring negotiations, the Government indicated that it wil]L direct the Ministryof Works and Housing and the Ghana Institute of Engineers to investigate theprocedures of selection, engagement, supervision, and remtneration of consult-ants, with a view to proposing improvements which would create a proper settingfor the sound development of local consulting firms.

3.19 PWD does practically no force account construction work. Majorcontracts are normally awarded after competitive bidding on the basis ofbills of quantities. To be eligible to tender for Government works, con-tractors are required to register with the Government. Nearly 200 contrac-tors are registered to do road works in one of four classes, namely: (i)exceeding C 250,000; (ii) C 100,000 - C 250,000; (iii) ¢ 25,000 - C 100,000;and (iv) below C 25,000. 1/ There are seven or eight indigenous firms in thehighest class (the largest being the autonomous State Construction Corpora-tion), and six or seven foreign contractors, only one of which is active.Most contractors in the other classes are mainly building contractors who arenot equipped for high quality roadworks, and whose activity is thus limitedto regravelling and construction of small drainage structures.

3.20 PWD has supervised the most recent road construction jobs, but itscontrol is seriously hampered by inadequate staffing and equipment. Workman-ship b-as been poor on the repair and maintenance works done recently. Toremedy this, more effective control is required, includinig proper authorityof the controlling agency to reject sub-standard work.

G. Maintenance

3.21 Soon after independence in 1957, the highway network was improvedby a major paving and upgrading program which made Ghana's road system oneof the best in West Africa. Some new roads were built or improved during the1960's, but the system as a whole deteriorated because oE low budget allo-cations for maintenance, late release of approved funds, lack of equipmentand spare parts, and understaffing of PWD. These problems were aggravated bythe combined effects of inadequate drainage structures, severe floods(especially in 1968), and roads built to standards unsuited for present

tratfic.

1/ In US$ equivalents: (i) exceeding US$217,500; (ii) US$87,000 - US$217,500;(iii) US$21,750 - US$87,000; and (iv) below US$21,750.

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3.22 Since 1970/71, the allocations for highway maintenance have beenrestored to a level which could be considered satisfactory under normalconditions, i.e., if there were no accumulated backlog of equipment renewaland deferred maintenance. The condition of the network, however, has hardlyimproved in relation to these increases, primarily because PWD has beenunable to use the funds effectively. The main reasons for these shortcomingshave been: (i) insufficient personnel, particularly qualified staff; (ii)lack of central control, both technical and financial, over expenditures;and (iii) low efficiency of the now largely obsolete equipment fleet.

3.23 The Crown Agents completed in October 1972 the draft final reportof the highway maintenance study (para. 2.02). They recommend a four-yearhighway maintenance program including: (i) measures for increasing stafflevels and training the labor force necessary to carry out a sufficientvolume of work; (ii) renewal and expansion of the equipment fleet, andreconditioning of workshops and stores as necessary; and (iii) eliminationof the existing backlog of deferred maintenance of gravel roads. The Govern-ment has confirnmed its intention to prepare and implement such a program.Additional preparation work will be required to define adequately the proposedhighway maintenance program, notably to adapt the Crown Agents' recommenda-tions to the proposed new organization, and to take into account the require-ments for maintenance of feeder roads.

3.24 The additional work necessary to formulate a highway maintenanceprogram on the basis of the Crown Agents' study and of the BRRI Feeder Roadstudy will be undertaken under the project (paras. 4.08 and 4.09). The time-tabla and the scope for preparation of the proposed maintenance program havebeen discussed and agreed during negotiations. The Government has confirmedthat upon completion of the above preparation work, it will consult with theAssociation on the scope and the timetable for implementing the proposedhighway maintenance program. The present project emphasizes rehabilitation,together with the proposed program to improve maintenance of primary, secondary,and feeder roads; as such, it will provide over the next four years theessentials of a sound highway policy. The proposed maintenance program couldpossibly form the basis for a future Bank Group operation.

3.25 The Crown Agents' study also confirmed the assessment of severalBank Group missions that central control over highway maintenance expendituresshould be strengthened. Although the funds voted centrally for maintenancecould be adequate, they are sometimes diverted to other uses, and PWDHeadquarters is powerless to prevent this. This problem was discussed atnegotiations, and the Government agreed that it would strengthen the controlof highway maintenance funds administered by PWD regional offices, and woulddirect these offices to account to PWD Headquarters for the use of suchfunds.

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4. THE PROJECT

A. General Description

4.01 The proposed project consists of:

(i) a three-year program for rehabilitation and improvement of 13sections of trunk roads (totalling about 345 mi), includingconsulting services for supervision of these works;

(ii) pre-investment studies to prepare future projects for reha-bilitation and improvement of trunk roads;

(iii) formulation of a program to improve the maintenance of trunk,secondary, and feeder roads; and

(iv) ac'quisition of equipment for traffic control and pavement survey.

Rebabilitation and Improvement of Trunk Roads

4.02 The proposed project includes road rehabilitation or improvementworks along the major transport corridors as follows: (a) Accra - Takoradi,(b) Accra - Kumasi, and (c) Accra - Ho. It also provides for similar workson some roads south of Kumasi, and in the rich agricultural region northwestof Accra. The project roads and the works proposed are described in Annex Ia-nd summarized in Table 3.

4.03 The proposed project is based on economic and engineering studiescarried out in 1970/71 by SWKP (para. 1.01), and their recommendation of arehabilitation and improvement program for about 750 mi of roads. Of these,the Government has with its own resources undertaken, directly or under con-tract, the required works on about 215 mi; the 345 mi of roads now includedunder the present project are those,of the remainder of the proposed programwhich have highest priority. The other roads (190 mi) left over from theinitial program comprise: (i) about 170 mi whose improvement could bepostponed for three or four years without the risk of irreparable deterioration,and (ii) an isolated section of about 20 mi of timber road which the Govern-ment prefers to consider later as part of a more comprehensive project,including a link with the main road network.

4.04 SWKP has prepared for the project roads drawings and specifications,as well as contract documents; these were all reviewed during appraisal, andwere found satisfactory for the works envisaged. Physical quantities forrehabilitation and improvement works are based on engineers' estimates, andare adequate to allow preparation of reliable cost estimates for all sectionsincluded in the project. In the case of partial reconstruction - Winneba-Swedru (11.3 mi) and Accra-Nsawam (19.4 mi)- some further detailed engineer-ing is required to prepare final bill of quantities and itender documents,and this will be carried out by the supervising consultants under the pro- -

ject. The consultants will also re-assess the scope of lpavement repair works

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required on the section Winneba Junction - Mankesim (28.5 mi) which has re-ceived some emergency repairs since completion of the SWKP engineering studiesin 1971.

Supervision of Construction

4.05 The Government is planning to retain SWKP, the consultants whoprepared the project, to supervise the proposed highway rehabilitation pro-gran, and to carry out the necessary complementary engineering. To take ad-vantage of on-the-job training opportunities offered under the project, whileat the same time maintaining the necessary performance standards, the follow-ing procedure will be used. SWKP would have full responsibility for thestaff to be employed for supervision, and would, to the extent possible, em-ploy Ghanaian personnel at both professional and non-professional levels.SWKP would organize on-the-job training for inspectors of works. The proposedarrangements for employment and training of Ghanaian personnel are reflectedin the consultants' Terms of Reference and in their contract; final draftsof these documents were reviewed and approved at negotiations.

4.06 Due to the special nature of the works and the large area to becovered, the cost of supervision will be somewhat higher than for normalroad construction contracts. Although Ghanaian engineers and technicianswill be employed to the extent possible, a large contingent of foreign person-nel will be required. The estimated manpower requirements are 19 engineers,and 14 qualified technicians, of whom T)robably one-third would be Ghanaians.Total requirements would be about 670 iban-months over three years, withGhanaian personnel accounting for about 30-35% of this total.

Pre-Investment Studies for Future Rehabilitation and Improvement Projects

4.07 By the time the present road rehabilitation and improvement programis completed, many other roads will have become due for similar works. Theproject includes economic and engineering studies to evaluate and, if justi-fied, to prepare the rehabilitation and improvement of 1_4sections of trunk_roads_totalling _about 750 mi (see Annex II). These roads offer prima facieevidence of being economically justified over the period 1977-79. The listcomprises the remainder from the initial SWKP program (para. 4.03), severalprojects not found immediately justified at the time of the SWKP study, andsome reconstruction projects from Government's investment program. It isanticipated that engineering and bidding documents will be prepared forabout 500 of the 750 mi of roads selected for feasibility study. The totallength of roads to be engineered for rehabilitation, improvement, or recon-struction works, will be determined by the Government in agreement with theAssociation; this determination will be made on the basis of conclusions ofthe feasibility studies, and in relation to the amount of resources expectedto be made available for highways from both internal and external sourcesover the period 1977-79.

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Formulation of Highway Maintenance Program

4.08 As mentioned previously (paras. 3.24 and 3.25), there is need fora program to strengthen the highway maintenance organization and to eliminatea backlog of deferred maintenance. Such a program has been recom ended by

the Crown Agents, and is of high economic priority. _The aLdditional prepara-tion work necessarv to define in detail the scope of each of the componentsof the proposed maintenance program will be carried out under the project.The Crown A.nts' _2posals will have to be revised and e:pap ded to take intoaccount the additional maintenance requirements of secondary and feeder roadsadded tot_Je rresTonsIlth1IT X xegional. offices. Complementary prepara-tion will also be required on the economic justification theprogram, as well as on its -oraiWIoALsy-tAlzg-sa;cs. The scope-f the proposed preparation works has been discussed and agreed during nego-tiations, and the Government has undertaken to complete this part of theproject by May 31, 1974.

4.0g The proposed preparation of a highway maintenanc:e program will beas much as possible an in-house effort by PWD. It will be carried out by aspecial maintenance task force established within PWD, and headed by anexperienced engineer of the Department. The proposed task force will beassisted as necessary by individual consultants. The orgtnizational arrange-ments for establishment of the proposed task force and the scope and durationof the necessary advisory services (five experts for three months, i.e. 15 man-months) were discussed and agreed during negotiations. In view of possiblefuture CIDA assistance for purchase of highway maintenance! equipment and forstaff training, the Government has requested that agency to provide the neces-sary advisory services to assist the proposed task force. Although not in aposition to react officially to the Government's request, CIDA representativeswho met with the Ghana and Association delegations during negotiations indicatedthat the request would be considered favorably, and an answer communicatedpromptly. As CIDA assistance is not yet sure, however, a provision ofUS$100,000 is included in the proposed Credit to finance the foreign exchangecost of advisory services to assist the proposed task force.

Equipment for Traffic Control and Pavement Survey

4.10 As outlined previously (para. 3.15), the Government will proceed tostrengthen the existing PWD Planning Unit, to complete and maintain a roadinventory, and to establish systematic procedures to collect and analyze theinformation necessary for monitoring evolution of the road network. To assistin all this, the project will provide traffic counters and equipment fortesting the structural strength of existing pavements, as well as weighingscales to assist in enforcing weight limit regulations (para. 3.04). Thedetailed purchase program proposed by the Government is expected to be sub-mitted to the Association by September/October 1973.

B. Cost Estimates

4.11 The project is estimated to cost approximately US$20 million equiv-alent, including foreign exchange costs of about US$11 million. Estimates

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of project costs (based on prices at end-1972) are detailed in Table 4 andsummarized below:

1 '000 US$ '000 equivalent ForeignLocal Foreign Total Local Foreign Total Component

(%)

(a) Rehabilitationand improve-ment of about 345mi of trunkroads 6,660 8,140 14,800 5,790 7,080 12,870 55

(b) Constructionsupervision 410 1,05 1,435 380 890 1,270 70

(c) Pre-investmentstudies 360 360 720 310 310 620 50

(d) Advisory servicesfor preparation of ahighway maintenanceprogram 20 110 130 15 100 115 85

(e) Equipment for trafficcontrol and pavementsurvey 40 385 425 35 335 370 90

(f) Contingencies:Physical 710 915 1,625 615 800 1,415Price Escalation 1,700 1,570 3,270 1,480 1,365 2,845

TOTAL 9,900 12,505 22,405 8,625 10,880 19,505 56

(rounded)(10,000) (12,500) (22,500) (8,500)(11,000) (19,500)

4.12 The cost estimates for rehabilitation and improvement works arebased on the SWKP studies, and revised to reflect changes in the parity ofthe cedi,and price inflation over the period from mid-1971 to end-1972.A quantity contingency allocation of 10% has been provided. The price es-calation contingency has been estimated on the basis of an annual increaseof 6% for the foreign exchange component of the project, and 12% for localcost; this takes account of the high rate of price escalation over theperiod 1971/72.

4.13 Cost estimates for consulting services for construction supervisionand for advisory services for the maintenance task force are based on averageman-month rates for various levels of professional qualifications, and takeaccount of the higher cost of foreign personnel. Cost estimates for pre-investment studies are based on an estimate of man-month requirements ofengineers and economists, and on per-mile estimates of the cost of specialized

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technical works such as aerial photography, topographic surveys, and geotech-nical tests. For the per-mile estimates, the low average figure of aboutUS$600 is adequate, because most of the projects consist of upgrading andrehabilitation of existing roads, some of which have already been studied.Most of the technical services will be provided locally (para. 4.19).

4.14 The foreign exchange component of road construction works isestimated to be 47% for contracts executed by local contractors, and 62% inthe case of foreign contractors. Assuming that about half of the contractswill be awarded locally, the overall foreign exchange comnponent is about 55%.For consulting services, the estimated foreign exchange component takes intoaccount the anticipated participation of Ghanaian firms and personnel, andis estimated at 70% for supervision, and at 50% for pre-investment studies.The tax element of the rehabilitation works is estimated at 12%.

C. Execution

4.15 The Ministry of Works and Housing will be responsible for exe-cuting the project through the PWD, with consultants SWKP providing directfield supervision. SWKP will also establish a central project unit to supportthe resident staff, to coordinate execution of the proposed rehabilitationand improvement program, and to organize and implement on-the-job trainingof field supervisors. The Government will assign a qualified engineer tofollow the program and to provide the necessary liaison. This arrangement,and the requirement that consultants be employed under terms and conditionsacceptable to the Association, was confirmed during negotiations; at thattime also, the draft supervision contract between the Government and SWKPwas reviewed and agreed (para. 4.05).

4.16 SWKP has already assisted the Government in preparation of prequali-fication documents, and additional services may be requiLred prior to signatureof the proposed Credit for processing and evaluating prequalification appli-cants. Retroactive financing in the amount of US$25,000 is provided tocover the foreign exchange cost of these services from March 1, 1973.

4.17 Contracts for rehabilitation works will be awarded after prequal-ification, on the basis of international competitive bidding following Bank/IDA guidelines. The program includes contracts of various sizes ranging fromabout US$400,000 to US$3 million, and with completion periods of between 9and 21 months. The Government is now being assisted by SWKP in preparingfinal proposals for appropriate phasing and grouping of contracts into pack-ages. The "packaging" will permit firms to bid at contract sizes which fittheir capacity. Contractors will be allowed to bid for a single road sectionor for combinations; some of the contracts will enable local contractors tocompete. The preparation of prequalification documents has been completed,and invitations to tender for the first "package" will be issued by November1973. Construction is scheduled to start by early 1974. The Government hasconfirmed that in accordance with the relevant existing laws and regulations,it will arrange to facilitate contractors' registration, mobilizing of foreignpersonnel, importing of equipment and materials, and transfer abroad offoreign exchange necessary for project execution.

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4.18 The proposed rehabilitation and improvement works are spread widely

over the densely populated area of the country, which will facilitate con-struction methods implying a high labor content. Because of heavy taxesimposed on imported equipment, and the scarcity of foreign exchange, themethods used by Ghana's road construction industry have been developed overthe past ten years under conditions favorable to the use of labor. Anotherreason favoring such use is the fact that the construction industry includesa large number of small contractors who have limited capacity for capitalinvestments in plant. Works under the project will provide employment forabout 1,000 persons over its three-year execution period.

4.19 The Government is planning to entrust the pre-investment studiesto the proposed National Consultancy Corporation (para. 3.09), but final

arrangements will be possible only after the Corporation has been established.A judgment is not yet possible on whether the proposed Corporation will havethe capacity to carry out this assignment, particularly in economic analysisand in pavement design, and the Corporation might seek cooperation with aforeign consulting firm. As is usual with large pre-investment studies, theAssociation and the Government would first agree on terms of reference, andthe Corporation would then be expected to submit a detailed proposal, includ-ing staffing arrangements, for approval by the Association.

4.20 The equipment will be procured following competitive bidding in

accordance with Bank/IDA guidelines.

D. Financing and Disbursement

4.21 Financing of the project will be as follows:

(a) IDA will finance:

(i) 65% of the total cost of rehabilitation and improvementworks; this represents about 74% of the cost of thisitem net of taxes, and covers the entire foreign exchangecomponent and about 22% of local costs;

(ii) 70% of the total cost of consulting services. For thesupervision contract, this proportion represents theentire foreign exchange component; for the pre-investmentstudies, it represents the foreign component and about40% of local costs; and

(iii) the actual foreign exchange cost of equipment purchases,and of advisory services for assistance in preparationof the highway maintenance program.

(b) Ghana will finance:

(i) 35% of the cost of rehabilitation and improvement works;

(ii) 30% of the cost of consulting services; and

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(iii) the local cost of equipment purchases and of advisoryservices for preparation of the highway maintenance program.

4.22 In the case of construction and consultant contracts, disbursementwill be based on a fixed percentage of 65% and 70% respectively of the cer-tified monthly statements. Payment for the acquisition of equipment will bebased on the CIF cost.

4.23 It is expected that construction work will start by early 1974,and will take three years to complete. Table 4 shows the financing plan forthe project, and Table 5 the estimated schedule of quarterly disbursementsfrom the Credit. With the prior agreement of the Association, any surplusfunds under the Credit Account would be allocated to further rehabilitationworks.

5. ECONOMIC EVALUATION

5.01 When the project was initially evaluated in November 1971, theeconomic rates of return for individual improvements included in the presentproject were found to range from 12% to 42%, with first-year benefits inexcess of 10%, indicating that the timing of construction over the period1973-75 was appropriate. The November 1972 re-appraisal showed that theconclusions of the initial analysis have essentially not been affected byrecent developments. Table 6 gives for each road section its traffic, briefinformation on its economic context, and the economic return and first-yearbenefit.

Traffic

5.02 Since the economy of Ghana is expected to grow slowly over thenext few years, similarly slow growth can be expected in the demand for roadtransport. For passenger transport, this demand will rise more rapidly thanfor goods transport, because of rapid population growth iLn the main urbancenters. On average, passenger traffic is expected to grow by 3% p.a. up to1976, and by 4% p.a. thereafter.

5.03 The figures on traffic growth of cars and small buses used for theeconomic analysis of the project roads varies from 1.5 - 5.5% p.a. between1972-76, and from 2.0 - 6.5% between 1976-81. The higher rates were adoptedonly for the main Accra-Kumasi route (Sections 20 B and 46, Table 3), andreflected both the anticipated growth in inter-urban pasisenger movement, andthe fact that demand for truck transport is expected to grow at only 1%p.a. as people use part of their increased income to pay for greater comfortin travel, and switch from "mammy-wagons" to buses. The annual rate ofgrowth of goods traffic is expected to be between 1.5 - 2.0% up to 1976, and3% thereafter. Passenger traffic is expected to grow much more slowly in thenorth of the country than in the south; the reverse is true for goods traffic,as the north will be the main source of future increases in production of

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basic foodstuffs. Spot-checks conducted in November 1972 indicated increasesin daily traffic of 5% or more on selected important routes over the period1971/72, suggesting that the above projections are conservative.

Level of Improvement

5.04 The project works will reduce high operating costs incurred by ve-hicles using the project roads which are now in a poor state of repair. Foreach road, two levels of rehabilitation were analyzed: the lower level con-sists of repairing failures, and removing the causes of the failures; theupper level includes upgrading roads to somewhat higher engineering standards.The consultants selected for each road section the level of rehabilitationwhich would minimize the net present value of total transport expenditures(comprising for a given road section the vehicle operating costs, andexpenditures for improvement, repair, and maintenance) over the expectedeconomic life of the improvement and rehabilitation works proposed for eachsection.

5.05 The review conducted in November 1972 has indicated the variouslevels of improvement initially selected to be still appropriate, except forthe Accra-Nsawam road (Section 46, Table 3) which justifies a higher levelof improvement in view of the permanent rerouting to this road of most ofthe traffic between Accra and Kumasi (see Annex I). The revised rate ofreturn for this road was estimated on the basis of the SWKP study, withsimplified assumptions to take account of the higher traffic levels. It wasalso necessary to re-evaluate on the basis of simplified assumptions thescope of works and the economic return to rehabilitation of the sectionMankesim - Winneba Junction (28.5 mi) which has received some emergencypavement repairs since completion of the SWKP study.

5.06 The economic costs of rehabilitation used in the economic analysisare the estimated costs of the work, including physical contingencies andsupervision. A ten-year economic life of the projects has been assumed, andall periodic costs to be incurred during that time have been included in theanalysis. This duration of economic life is considered reasonable for therehabilitation work which comprises the bulk of the project, but appearsrather conservative for improvement and upgrading.

Benefits

5.07 The benefits of the proposed project have been quantified in termsof cost savings, and have not been related directly to increases in produc-tion; there is no doubt, however, that less expensive and more reliableroad transport on major primary roads will facilitate the development oftrade, and allow more efficient and increased production. The project roadsserve zones with relatively high agricultural activity and population den-sity. Many of the roads are part of inter-regional transport routes. Table6 provides qualitative information on the nature of traffic carried by theproject roads, and thereby gives an idea of the economic activities which arelikely to benefit from the project. Passenger traffic plays a dominant roleon most of the roads which are part of inter-city corridors. Important com-modities by tonnage are petroleum products, foodstuffs, cocoa, and timber.

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Given the fair degree of competition prevailing in the road transport in-dustry, it can be reasonably assumed that the transport cost savings resultingfron the project will be passed on to farmers, consumers, and passengers.

5.08 Directly quantifiable benefits from the improvements works consistof savings in road transport costs and reductions in maintenance and repairexpenditures. To estimate these benefits, the consultants undertook extensivefield work, and costed the operation of four typical kinds of vehicles inGhana under different conditions with respect to surface type, road condition,and alignment. Because of the relatively low traffic volume on the roads inquestion (only five sections carry more than 1,000 vpd - Table 6), costsdue to congestion are not relevant. The effect on operating costs of varia-tions in operating speeds resulting from the road condition on each sectionhas been computed, and is shown graphically in the Plate. The savings invehicle operating costs for each of the project roads for various classesof vehicles are shown in Table 7.

5.09 In addition to savings in vehicle operating costs, the consultantscalculated the savings in costs for recurrent and periodic maintenance whichthe restoring of the project sections to good standards should allow.

Sensitivity Tests

5.10 The economic evaluation of each of the project roads relies on anumber of inputs which have been quantified with varying degrees of certainty.The estimates of future traffic growth and savings in future road transportcosts appear well-founded and conservative. The estimates of the cost ofcivil works proposed under the project appear, however, to include someelements of uncertainty, due to the fact that there is in Ghana no recentexperience of large road construction contracts awarded on the basis ofinternational competition. The economic net rate of return of the variousproject roads have therefore been tested for a 10% increase in road con-struction costs (see Table 6).

5.11 It was not found necessary to use a shadow price! for labor costs,as wage rates for skilled and semi-skilled workers appear to reflect oppor-tunity costs. The opportunity costs of unskilled labor irn some parts of thecountry is below the existing PWD rate, but the extent is unknown. No studyhas been made to estimate the differential between total real income of PWD'sand other unskilled labor. A shadow rate for this labor would probably haveled to slightly higher estimates of the returns for each road section.

5.12 Another source of uncertainty arises from the difficulty in assessingthe equivalence between the local and foreign exchange comnponents of the pro-ject cost. The conclusions of the economic analysis were therefore testedfor values of the exchange rate up to 140% of the officiaL rate of the cedi.This sensitivity analysis showed that variations in the exchange rate af-fected the rate of return of the different road sections only slightly, as in-creases in benefits were very nearly compensated by increases in costs. Thestructure of the construction cost (foreign exchange content and labor) islargely similar to the structure of the benefits considered, namely reducedvehicle operating costs, and savings in road maintenance expenditures.

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Conclusion

5.13 The estimated rates of return for each road section resulting fromthe analysis outlined above are conservative figures which provide a soundbasis for evaluating the economic justification of the project. The returnson individual sections of the project range between 12% and 36%, to be com-pared with an estimated opportunity ccst of capital in Ghana of about 10%;the weighted average return of the project is estimated at about 22%. Theaverage return of the project with a 10% increase in road construction costsis about 19.5%, with individual returns ranging between 10% and 33%. Theproject is therefore economically justified.

6. AGREEMENTS REACHED AND RECOMMENDATION

6.01 During Credit negotiations between the Government and the Association,the following principal items were discussed and agreed:

(i) the need for economic and technical evaluation by PWD of allfuture highway projects of major importance, and for its assessingthe justification of such projects in relations to Ghana'sdevelopment objectives (para. 2.15);

(ii) supplementing the existing regulation on vehicle weightcontrol by a provision to impose a reasonable limit onaxle-loading (para. 3.04);

(iii) a time-table for formal establishment of a Planning Unitwithin PWD, including details of its specific responsibilities(para. 3.15); and

(iv) measures to be taken by the Government to ensure a propersetting for sound development of the local consultingindustry (para. 3.18); and

(v) strengthening the control by PWD Headquarters of the use ofhighway maintenance funds administered by its regional offices(para. 3.25).

6.02 The project is suitable for a Credit of US$13 million equivalentto the Government of Ghana on conventional IDA terms.

June 29, 1973

TABLE 1

GHANA

FIRST HIGHWAY PROJECT

Estimated Road and Rail Output, 1969(million ton-miles)

Road % Rail % Total

Timber 83 53 75 47 158

Cocoa 38 56 28 44 66

Manganese - 0 18 100 18

Bauxite - 0 39 100 39

Agricultural 86 97 3 3 89

Building Materials 61 95 3 5 64

Petroleum 50 96 2 4 52

Other 103 96 4 4 107

TOTAL 421 71 172 29 593

Source: Transport Sector Study by Nathan Consortium, May 1970.

December 1971.

GHANA

FIRST HIGHWAY PROJECT

Estimates of Budgeted and Actual Highway Expenditure 1968-72(million cedis)

1968/69 1969/70 1970/71 1971/72 1972/73Budgeted Actual Budgeted Actua BugetActuaJl Bu3dgete7Actual Budgete

Trunk Road Construction 3.5 2.3 5.1 5.2 7.2 9.3 158F (9/5) 10.1

Feeder Road Construction 1.5 2.5 4.0 5.7 5.0 4.8 11.8 (7.1)e 2.8

Road Maintenance andRehabilitation 2.1 2.0 10.5 9.7 11.8 10.7 17.7 (13.3)e 16.1

Technical Services(Consultants) 0.1 0.1 1.3 1.2 0.1 - 2.0 (2.0)e 0. 4

Other Road Tr nsportInvestmentl 1.3 1.1 2.1 1.6 2.9 2.5 2.7 (2.7)e n.a.

TOTAL 8.5 8.o 23.0 23.4 27.0 27.3 50.0 (34. 6 )e 29.4

i/ This includes ferry services, hydrological works, and conmunity development programs.

2/ Preliminary estimates based on rough evaluation of overall percentage of amounts spent compared with initial budget.

Source : PWD, November 1971

December 1971.

_G h A N APUtST HIGHIWAY PROJECT

List of Project Roads, Proposed Design Standards for Rehabilitation Works aod Construction Cost Escimates

Overall D n tandards Construction Cost-Length Width Width Design Speed (0 000, Nov. 1972 values)

Sub-Project Number Road Name Scope of Proposed_iroveents of formation Pavement (when appropriate) Total Average permile

11 A Teehi-an to Chira 25.7 Improvement and paving of 32 ft 22 ft 60 mph 1,012 35.,existing gravel road

20 B Anyinam to Kumasi 81.0 Improvement of vertical alignment, 36 ft 24 ft - 4,216 47.3widening and partial reconstruc-tion of pavement

21 Kamasi to Anwiankwanta 15.3 Widening of formation improvement 36 ft 24 ft - 745 44.4of vertical alignment and draina-ge widening of pavement

22 Anviankwanta to Bekwai 5.0 Same as 21 34 ft 24 ft - 22B 4,.5

35 Yfamoranaa to Sekendi Jet 46.1 Reconstruction of shoulder and 36 ft 24 ft - 2,213 43.6widening and repair of pavement

36 Mankesim to Yamoransa 16.5 Same as 35 36 ft 24 ft - 510 28.1

37 Winneba Jct to Mankesim 28.5 Same as 35. Scope of pavement 36 ft 29 ft - 798 282/repair to be re-assessed underthe project

38 Accra to Winneba Jct 34.0 Same as 35 36 ft 24 ft - 1,100 29,1

39 Winneba to Winneba Jet 2.5 Widening of the formation and 36 ft 24 ft - 138 50widening and strengthening ofpavement

41 Winneba Jct to Swedru 11.3 Reconstruction on the basis of 36 ft 24 ft 60-70 mph 1,088 87.5deta1ied engineering to be carriedunder the project

45 Adaiso to Kade 37.4 Reconstruction of the shoulders 36-30 ft 24-22 ft - 818 19.9and widening and strengthening ofpavement

46 Accra to Nsawam 19.4 Reconstruction on the basis cf 36 ft 24 ft 70 mph 1,557 72.9detailed engineering to be carriedout under the project

50 Trom Jct to Kpong 9.8 Reconstruction of shoulders and 30 ft mi. 22 ft - 515 47,7widening and strengthening ofpavement

51 Kpong to Anyirawasi 36.2 Sameas 50 30 ft min. 20-22 ft - 860 21.6

TOTAL 340.3 hk

l/ hot including engineering, sapervision and contingencies._/ Estitates based on updating of initial SWIGP estimates (037,70() per mi) to take into account more limited scope of pavement otrengthening and repair.

Source: SWI4 Road Rehabilitation Program, September 1971Mission estimates, November 1971 and November 1977

May 1973

GHANA

FIRST HIGHWAY PROJECT

Cost Estimates and Financing Plan

--------------- Cost Estimates-------------------- Foreign -------- Financing Plan--------------- (o '000)- - (US$ 000E) ------- Fxchange -- (¢ '000)--- -(LE '000)-- IDA as %Local Foreign Total Local Foreign Total Component Govt. IDA Govt. IDA of Total

(a) Rehabilitation andimprovement of aLout 315miles of trunk roads 6,660 8,1T0 l1l,800 5,790 7,080 12,870 55% 5,180 9,620 4,5 05 8,365 65%

(b) Consulting services forconstruction suoervision blo 1,025 1,435 380 89C 1,270 70% Lbo 1,025 380 89C, 70%

(c) Consulting services forpre-investment studiesfor improvement of about700 miles of roads 360 360 720 310 310 620 50,% 215 505 185 135 70%

(d) Advisory services forpreparation of a highwaynaintenance program 20 110 130 15 100 115 85% 20 110 15 100 85%S

(e) Equipm.nt for trafficcontrol and pavementsurvey 40 385 425 35 335 370 90% 40 385 35 335 90%

(f) Contingency provisions for:

(i) increases in physicalquantities -- 10% on(a) and (b) 710 915 1,625 615 800 1,P15 560 1,065 0185 930 65%

(ii) increases in prices-(a) 10% p.a. local

7.5% p.a. foreign 1,655 1,070 3,125 1,4)30 1,280 2,720 1,095 2,030-(b), (c), (d), and(e) 5% 45 100 135 40 85 125 35 105

Subtotal (ii) 1,700 1,5770 1380 =2 01,365 1,3 2,135 982 1,865 65%

Subtotal contingencies (f) 2,l10 2,485 3,895 2,095 2,165 )L,260 1,690 3,200 1,465 2,795

TOTAL 9,900 12,505 22,105 8,625 10,880 19,505 56% 7,555 1, 845 6,585 12,920 66%

(Rounded) 10,000 12,500 22,500 8,500 11,000 19,500 7,500 15,000 650 13,000

12

Sources: SWKP Road Rehabilitation Program, September 1971Mission estimates, November 1971 and November 1972

June 1973

TABLE 5

GHANA

FIRST HIGHWAY PROJECT

Estimated Schedule of Disbursements

IBRD/IDA Fiscal Year Cumulative Disbursementsand Quarter Ending at endL of Quarter

(7US, 000 )

1973/74

December 31, 1973 50March 31, 1974 50June 30, 1974 700

1974/75

September 30, 1974 1,350December 31, 1974 2,050March 31, 1975 3,500June 30, 1975 5,000

1975/76

September 30, 1975 6,500December 31, 1975 8,000March 31, 1976 9,500June 30, 1976 10,500

1976/77

September 30, 1976 11,500December 31, 1976 12,300March 31, 1977 13,000

Closing Date: December 31, 1977

Source: Mission estimates, November 1972.

June 1973.

GhANA

FIRST HI[GiwAY PROJECT

Economic Evaluation of Project Roads

Slb Projlects Traffin Eco0001i Analytis _ _ _ Economic Co onext

0 nsitivity

Traffic Srroetoro af Traffi.1/ Cons icct oinLength 1971 by Vehicle Classos % Economic First Yeer Eoonuooi Mais Traffic o

N.. Road Nane (ni) _.p.d. (1) (2 (3) (4) Rati of Return 7 BRenefits i Rate of Retuco % Eromnoi Role Co-oditien (t.onaKs.)

20B Anyinam to Ku-asi 81.0 940 61 8 23 8 22.5 19.3 20.4 Aror-K-uen --corridur; Manufactured goods, cc,inte-regional erode. foodsetof. timberprod-ce -ollettiom

21 KCpasi to Awiasnk.anta 15.3 1,060 58 15 21 6 12.1 13.2 10.3 Kumasi-Cape Coo-t- Passeogers. timber, onoe,Taboradi corridor, ineer foodetuiregional tcado, produoe

22 Anoinkb.anca to Bekiai 5.1 540 50 17 26 7 27.3 24 24.5 collection

35 Yenorones to SekondiJonction 46.1 1,170 54 9 27 10 19.2 1B 17.1 Accra-Cape Coast- Passongers, petroleum prodocts

36 Mamkeim in Vamaromee 16.5 1,250 57 14 25 4 36.3 27 33.5 Tokoradi corridor, inter nmeufactured gRoda,tinber,

37 Widipeb. Jct. tE Mankeaim 28.5 960 57 IJ1 25 o 15.6 31.5 12.5 t onora utrate enudntofi

38 Acorn -t Winneba bJt. 34.0 1,700 58 18 31 3 30.3 23 27.2

39 Winmeba ti Winneba Jct 2.5 1,053 69 17 13 1 17.3 17 15.1 Linking Winmeba with Possemgrrs, petroloum productsAc-ra-Cape Coart-Takoradi nonuinctoced gooda timbercorridor foodstuff, fish

41 Winneba Jot to Seden 13.3 810 54 28 15 3 13.8 14 11.8 Regional link with Acorn- Passeng-rs, c-coa, foodstuffTakocadi nurridnr, producecolle-tiom

45 Adaiso to Kode 37.4 430 51 30 14 5 17.0 19 15.4 Produce - ollection Cocos, maize, otec foodatuff;in thb fCtae, palm oil fromproposed IDA-fimonced project

-- od Kwes

46 Aclra to Nsawem 19.4 3,400 61 16 18 5 26.8 25 24 A-cra-Kofo-idua-Kunasi Passengers, petroleum products,corridor; inter-regional manufactored goodcd,foodstufftrade, supply of A-cra

50 Tro- Jot. To Kpong 9.8 620 51 34 14 1 23.4 21 21 Limk between Accre -nd Manufactured gOods, foodstuffVolta region and Akononbn

eas, inter-re_Rioal trade

produlce collection

51 Kpong to Anyirasasi 36.2 610 58 10 28 4 23.1 24 20.32 Soto as 50 Sane as project no. 50 inaddition, petroleum praducts

1/ See Tablo 7, footrott 1/.2/ Updahng L initial SWKP ectierate. S-oo, of uork o e re-. ssesred e.. ider the jrojeor.

Source: SWkP Road Rehabilitation Prograr,,eterher 1971Miosion estientes,Nl bmobec 1971 und Nlcv -er 1370

May 197J

GHANATABLE 7

FIRST HIGHdAY PROJJ,CT

Savings in Vehicle Operating Costs(cedis per vehicle-mile per year, 1971 values)

Class of Vehicles

Road Section No. Class 1 Class 2 CLass 3 Class 4

11 A 15.33 13.97 28.10 50.37

20 B 4.38 2.19 5.84- 10.22

21 2.19 1.09 2.92 4.74

22 11.31 3.65 1L4.96 16.73

35 3.65 1.83 4.74 7.66

36 3.65 1.83 4.74 7.60

/237- 2.19 1.09 2.92 4.74

38 2.19 1.09 2.92 14.74

39 4.01 2.64 6.93 11.68

41 11.31 3.65 1L4.96 16.78

45 6.20 2.64 6.93 12.04

46 4.38 2.64 5.84 12.04

50 11.31 3.65 1L4.96 16.78

51 4.38 2.69 5.84 10.22

1/ Class 1:(a) private cars, hire cars, and taxis;(b) light buses with capacity of less than 22 people;(c) light goods vehicles with two axles and single rear tires, including

pick-ups and vans.Class 2: Mammy-wagons; 3-ton trucks with wooden bodies used for carrying

passengers, or mixed goods and passengers.Class 3: Medium vehicles including:

(a) heavy buses with a capacity of more than 22 peop:Le;(b) medium goods vehicles 5-ton and above.

Class 4: Heavy vehicles: goods vehicles with 3 or more axles,timber trucks,tractors, trailers, assembly tankers, etc.

2/ Updating of initial SWKP estimates on basis of simplified assumptions.See Note 2/ in Table 3.

Source: SWKP Road Rehabilitation Program, September 1971.Mission estimates, November 1971.

May 1973.

ANNEX IPage 1

GHANA

FIRST HIGHWAY PROJECT

Description of the Project Roads

A. Accra - Kumasi

1. The project includes two sections on the routes between Accra andKumasi:

Section 46 Accra - Nsawam 19.4 miSection 20B Anyinam - Kumasi 81.0 mi

Total 100.4 mi

2. A new high-standard road has recently been constructed betweenNsawam and Bunso; similar works are underway between Bunso and Anyinam. Withthe proposed rehabilitation works, the link between Accra and Kumasi viaNsawam will be of a satisfactory standard. The opening of the new route bet-ween Nzawam and Bunso has increase;d the traffic flow along the Accra - Nsawamsection. On the basis of two-day moving car observer count in November 1972,This traffic is estimated at about 3,500 vehicles per day (vpd), as comparedwith a mid-1971 SWKP estimate of about 2,150 vpd.

3. The Accra - Nsawam road has a fair horizontal alignment and gen-erally adequate drainage, but poor vertical alignment and a weak pavement.The road width is 22-24 ft over a 30 ft foundation. Initially, a lower levelof rehabilitation was considered the most economic solution. However, withthe considerable increase in traffic over the past 12 months, and the result-ant more rapid pavement deterioration than envisaged, the higher level ofrehabilitation would now be the optimum solution. The original computationindicated that there would be a positive net present value for this solution.The higher level of rehabilitation basically involves widening the platformand constructing of a new 24 ft pavement, together with some re-alignments.In view of the broader scope of works, full detailed engineering will becarried out under the project prior to tendering.

4. The Anyinam - Kumasi road which crosses undulating terrain is oflow construction standard, and has a bituminous surface that needs excessivemaintenance to keep it in fair condition. The horizontal alignment is reason-able, but the vertical alignment requires some improvement. The formationis narrovy in places, and additions or replacements to the drainage structuresare advisable. The pavement is generally badly deformed and requiresstrengthening. The design for the road entails the addition of 6 inches ofnew sub-base in some places, re-surfacing to a width of 24 ft, widening ofthe formation where required, and some improvement to the vertical alignmentand the drainage system. The deterioration of the pavement over the past12-18 months has been more rapid than anticipated by SWKP.

ANNEX IPage 2

B. Accra - Takoradi

The prolect includes three sections of this coastal road as follows;

Section 35 Sekondi Junction - Yamoransa 46.1 miSection 36 Yamoransa - Mankesim 16.5 miSection 38 Winneba Junction - Accra 34.0 mi

Total 96.6 mi

The whole of the coastal road is of similar characteristics, standardand condition. Its average width is 22 ft, with 3-6 ft wide verges on eitherside. It is bituminous surfaced, with good alignment, generally adequate earth-works and drainage, and acceptable pavement over most of its length. Theroad is under continuous maintenance. However, failures and some deformationof the pavement along its outer edges have been caused by soft and constantlywet verges in the rainy season, by drainage inadequacies, and by the narrowformation width in places.

7. For the purpose of the economic analysis, only one level of reha-bilitation was considered for all sections. The verges will be replaced withsuitable material, the pavement strengthened, and the formation widened asrequired. In addition, a few small drainage structures will be added, andresurfacing 24 ft wide, with minor improvements made to the vertical align-ment by raising low-lying sections.

S. SKIP initially recommended rehabilitation of the road WinnebaJunction-Mankesis (Section 37, 28.5 mi), along with the rest of the coastalhighway between Accra and Sekondi. Field inspection carried out during theNovember 1972 re-appraisal mission showed that this section had receivedemergency pavement repair, and that as a result its condition had notdeteriorated as rapidly as anticipated. The re-appraisal mission suggested thatrehabilitation of Winneba Junction-Mankesim should be postponed for three tofour years. During negotiations, the Government requested that this sectionbe included in the project in lieu of paving of the Techiman-Chira road(25.7 mi) 1/.

9. The Government would like to have all sections of the coastalhighway brought to common standards. This objective is sound. It will benecessary to redefine the scope of the rehabilitation works initially pro-posed by SWKP to take into account the emergency pavement repairs carried outsince 1970-71. SWKP will supervise construction, and will carry out theproposed re-assessment of this section and revise the engineering documentsaccordingly prior to tendering. The works to be undertaken for this section

1/ Paving of Techiman-Chira was initially included in the present project,but the Government indicated at negotiations that it would prefer toundertake this work with its own funds as a follow-up job for the con-tractor who has just completed paving of the Sunyani-Tamale section.

ANNEX IPage 3

would mainly include reconditioning of shoulders, and strengthening andwidening of the pavement edges to standard width. A simplified economicanalysis based on an updating of the initial SWKP evalualtion showed thatsuch work would be well justified.

10, Another section (Section 34, Sekondi Junction - Takoradi, 10.4 mi)itras i5nvestigated by the consultants, but rehabilitation was not found econom-ically viable at this stage.

r. iAccra - Ho

11. The project includes two road sections:

Section 50 Trom Junction - Kpong 9.8 miSection 51 Kpong - Anyirawasi 36.2 mi

Total 46.0 mi

?2. For the section extending 6.3 mi out of Accra,, rehabilitation wasfound to be economically justified; this work is to be financed from theCoverrment's own resources. For the next 24 mi section to Trom Junction,the road is of only mediocre standard, but traffic densJity does not justifyrehabilitation at this stage. The remaining section Anyirawasi - Ho (11.7 mi)is in good condition and needs no rehabilitation.

13. The section Trom Junction - Kpong is a bituminous surfaced road ona bad alignment, with poor earthworks and inadequate drainage. It is anarrow road - 18 ft pavement width with 2 ft soft verges - whose surfaceia deformed and potholed. It passes through many built--up areas and isfrequently congested. The proposed design calls for replacing the vergeswith suitable material, improving the vertical alignment, formation widthand drainage, strengthening the pavement, and surface dressing to a widthof 22 ft.

14. The road Kpong - Anyirawasi is bituminized, bult several sectionscontain deformations which require repair. The average width of the surfac-ing is 20 ft, with some sections now partially reconstructed. The proposed

design entails strengthening the base where this reconstruction has failed,widening the formation to 30 ft minimum where required, and resealingthroughout.

I). Auxiliary Roads north-west of Accra

15. The project includes three road sections in the region Mankesim -Winneba - Swedru - Adaiso - Kade, as follows:

ANNEX IPage 4

Section 41 Swedru - Winneba Jct. 11.3 miSection 39 Winneba Jct. - Winneba 2.5 miSection 45 Adaiso - Kade 37.4 mi

Total 51.2 mi

16. The Swedru - Winneba road, the most expensive rehabilitationsection in the project, is bituminous surfaced, with reasonable horizontalalignment but poor vertical alignment. It crosses undulating terrain withlight to medium forest vegetation, and passes through several villages andtowns at its northern end. The weak pavement, poor vertical alignment andnarrow formation width - 20 ft bitumen surface on 22 to 24 ft formation --have caused deformation and deterioration of the road surface. The rehabil-itation proposed includes widening the formation to 36 ft., improving thevertical alignment and drainage, realigning three short sections of the road,and constructing a new pavement, surface-dressed to 24 ft. In view of thesubstantial alignment corrections, both vertical and horizontal detailedengineering will be prepared under the project prior to tendering.

17. The Adaiso - Kade section is a bituminous surfaced road with reason-able alignment and drainage, but with a narrow formation width varying from22 ft to 26 ft. The pavement deterioration has been more rapid than antici-pated, and the deformation has developed into potholes. This road is themain route for the exportation of products from the proposed palm oil projectcentered at Kwae. Two levels of improvement were considered, but the lowerlevel proved the more economic. This entails replacing the soft verges withsuitable materials, reshaping and strengthening the pavement where deformed,and resealing throughout.

18. The initial project had also included the improvement of two addi-tional sections, Mankesim - Swedru (Section 40, 37.8 mi) and Swedru - Adaiso(Section 42, 24.8 mi) which have poor alignment and inadequate drainage. Thepavement, though deformed, is quite sound; it is 18 ft wide, with 2-3 ft softshoulders on either side. Although the lower level of rehabilitation provedeconomically justified, it is felt that this work, although improving thepavement, would leave a low-standard alignment. It was found preferable topostpone rehabilitation of these two roads until traffic has increased, anduntil a higher level of improvement is warranted.

E. Kumasi - Takoradi - Roads south of Kumasi

19. The project includes two sections, viz.:

Section 21 Kumasi - Anwiankwanta 15.3 miSection 22 Anwiankwanta - Bekwai 5.1 mi

Total 20.4 mi

ANNEX IPage 5

20. The consultants SWKP carried out a study of highway priorities inthe Kumasi - Takoradi corridor, considering what improvements, if any, shouldbe made on the existing two alternative links via Tarkwa and via Cape Coast,and whether construction of a new direct road between Dunkwa and Takoradiwas justified. They concluded that, at the estimated construction cost, anew Dunkwa - Takoradi link was of low priority. It was determined thatimprov;ement of the existing route via Tarkwa, particularly upgrading the badgravel road between Ayenfuri and Bawdia, would attract sufficient traffic tomake the latter an economically feasible solution. The Ghiana Government willnow finance rehabilitation of the sections Ayenfuri - Bawdia - Tarkwa, buthas requested IDA financing for two other sections totalling 20.4 mi: Kumasi -Anwiankwanta (15.3 mi) and Anwiankwanta - Bekwai (5.1 mi). The remainingsections of the route are in satisfactory condition.

21. The first 9 mi of the Kumasi - Anwiankwanta road are of low con-struction standard, 22 ft wide with 4 ft verges; the remaining 6.3 mi havea 24 ft wide pavement with 6 ft verges. Only one level of rehabilitationhas been considered. On the first section, this would involve widening theformation, improving the vertical aliignment and drainage, constructing 6inches of new base, and siurface dressing. The second section requires somerepairs to the pavement and replacement of the soft verges with suitablematerial. The Obuasi - Dunkwa section is a bituminous surfaced road withgood alignment, adequate earthworks and drainage, and a 24 ft pavement ingood to fair condition. SWKP found, however, that the pavement was showingsigns of deterioration on the Obuasi - Dunkwa section which had not been asrapid as anticipated by SWKP, and the minor potholing and deterioration ofthe bituminous surface appears to have been adequately taken care of bymaintenance operations. This section was therefore omitted from the project.

22. The Anwiankwanta - Bekwai road (Section 22, 5.1 mi) has been addedto the original project. The existing road crosses undulating terrain andhas a reasonable alignment, but with poor earthworks and drainage, and adeformed pavement. It forms the cross-link between the corridors Kumasi -Tarkwa - Takoradi and Kumasi - Fosso - Yamoransa. The proposed rehabilitationwould include widening the formation to 34 ft, replacing the verges withsub-base material, improving the vertical alignment and drainage, adding 6inches of new base material, and resurfacing to 24 ft wide. This proposalwould give a positive net present value, and the section is therefore includedin the project.

OdANA ANiAN II

FP.3ST II fl3IdaY PRiAJCT

o-i-.veat-ent Studies: Propose Loot of Sob-Projects

fNo. Road Lenith Prrsevt 'oadirlon laprr*emiot Works and issie S Preinvestmnet Studios

I Kasrai so Abofoor 26.4 Par-t f nain roate rorth of Peiobilitatloi, aide-ing, Rood -as iroaded ir SAKP Updaot in o econ.owi f-osibllityKiasosi o Toroiesod O' scan ood raroi ret, Tetroorao atudy Pl 7labt co .o.nd Itody ad crpleelaaoy eng-I-bit_itntos sortoond rosd. It- ieediote3y j_ntified. eerin as op.rop.a.oe. aith a oi-Aodeqoate altSnpeat,arrbwarhs, - Sarvey, detailed design to prep-ratben biddiog doo-tentosod earo -e. arteraortain avoiloble - bo bill of qooo- of p-ojeor foasd jantifaed.rapidly. titles.

2 Ktuoti to St-voi 75.7 (i) Komoa- to Bsohan (43 ni) K--rati to Bethen: Rehbilito- Sbrry and draiRI in pragre-s Eoonoa fe-sibilty stody20' bitmimfoos s-rfatod road; tics, eifenlng,ai d parStil corred oot bv Ipoal c. ns. - oi foled by canpieseroaro en-poor neetriGa and tonlmontal rroaastocat os. teots 015-Ibaco C_oltas_ts gir.eringosoyproorioa,esiii a visaal iges1i t. to preparation bidding doanesoto(ii) bRle;` to Suny;pi Beobeh to S-nyn,i nid-i.gf, nf project foond juntifird.(32.7 ilj 15' bitoni-ets ear-f-ced rood.

3 TR-mae to Yeodi 59.0 -oad arandaro gravel road Upprading by copstrubction of ortoy and desigs E.a.iable Boconotic f-asiility stody fo!-seenint nonrtkoasters fogies biboRniort povearot Sat ed hay aoynoenacro en5ioeebin5

bid iaf do .. ena if groject(ocod josaiffll.

4 Ahonfuri Lo Wiawasc 41.5 (i) Ayeefaei-slfVi Bekwbi PartiIleonstioe cod fuse. goonomic oathilicy stady an(39.6 er) iS' vade fretei upgradins awithatontacds prosistoary engteneriro,o beroad, poor conditior; parel- paeiniat foiloand by detailed ensineeringiellitg roiway li-e; first oan preparcais at bidding dot-S mi being pored as part o osrote if project fond li s5sSid d.

Aypef-ni-keot a uacoast_ro_otiproj eat(ii) A-sno-Wiawaso (t16.9 etR-a-el -ad b.ise malnainbodat G--eenneets eopense byGiktnio' Tinber Cospasy.

Seeder to bankosim 37.5 F'aentioe and bitoniaous Rehobilitoti-a. wittoina La levo of r-h,it hI ot rdt

6n Swede, to Adais 2.8 r v aL aorteontal a pqt idth;te omp oe.. ator =ears stiii to oderkng ianor slignena. lWKP stody. he panement fetes of anpoert-_tv . fo lIoad7 idaSno in teanata is.o ouptoro> eaood,rrcjeot rote. hyr~~~~~~~~~~~~~~~~~~~~~~~~~~~~l IPi 1yr_opr-Sobei e deratetkl ;9

7 Adaisz to d#akas 10.0 'Ip a otit iAtra,se is traf- ertoo aid prepoereion of

Ibthotal 72.6 fir sasl narrast patilo ingf irroarnas if boAre onstructior. jootibifd.

8 _~- S-_f-l-i -

d ekwal to loss 62.2 iircnierras a-fced rood ci RehoilLrrilor, wioeoino, Survep o tartione is need bpdoli,g 0f SWKP st-dy to bhand naero' d-foorrdpaly ailgned and parttco rnoooonstpoioo of reoit

5noo4t fe-gn ar- foiiya1 d -s app-opriate bvde

9 Pose or Pateeansa 44.9 foreactst. riedouteby PWD. taiiedeng_ineeraing ed preparoecon

SIbtasal 106.9 _foor.d o - Ei ed.

*n keer to Domega 48.0 tra in eoad;naneneasooa 5 Inproronat tealuding op none. Osooaeoissonor atd .dentafl-ilmk betomen eartehaessarn srading by constructior cation,followed us ecoonirstottors aeso and iwealel of bito-ninoe pyavrpnt oeatib-al- stodo and eng.ssertngfoosteant. ood pnrepcaui'oI i bi0 di0 d

dot_setee it projeot found _astiliod.

IS Ye-di to kete Karachi 127.0 Liking sendi with creth-et es e at 01U. Ooio. sv as #IolcoOno of PoSs ilak anod mteats orooto read tor thtooth located ease of Vite

1 d Baadta e -Bnhi 66.9 Grea? rod 00 poorondi- PeLtic) ratoetat bo toavev aid ietild er- Loonovia tocebility asody to beti_0. end upgradiog hi too- gineering aoaiiolsb. f oei as biproprlate ho roe-

Ienrot o iprepared by GteArkp. Plg noteY engIeering cod op-daat-g of biddio; d-csae,,

5if

projeot frond jURti Fied.

13 Ta-ka tO kogoso 23.0 Port af tma Takoradi- Rebabolitat-on ond ban. Psobilno road; to be frl]aeetmaso c-orrid-re Badly ne - str-aghe-ne fn of Pave- asappropiat s by ddm bdocumends

p_=nnen. iprjc fod jsfid.

14 Bimbila so ih_bbluI 41.0 o .rood tprsean.t. few dardcotton of bti tn- loroap. Reonnaias n ad odenaidi at,osroad ikie aate t h dtrra graoi op.o bd b oittea-

h east r-d to Arke: -fd rod. sitility tatdy and praliminarpsele of shte itr ILe liagiie-ridt (e-cept -ervy9;tj ire

no n sneeool yesor- foliowed as oppropriate by detaIledfee distance hetotes Tan- sengt perior cod prpepratcno cf hid-aid -e d in ora t io be a h d in

6d ato ne nst if proje t fo ond-inrdi-, aioaibjoatflled.

proieat eo.Sli: tt$i

15 Arare (Iegre) tb Aburi iLl0 E;ititng paed road is osehbilitation and RSode wepe included in Updating af e-ieting SkTP16and aidt ad detes Pore- strengtsvsng oi non- SWKP etudy but yt re- eresomia sttoo, ie vise of Poe-

in6a h noAde ii neathdy deterio-tieet, hld * i_ tamed in vieo of lovers- sibiLity to -odetek hiand 12.0 riding- cpdition. duer of - .tiders. nt plan ta go ehead level ef ieprooseent followedSOd Aslofonia to Bpnoridsa L23, rising aro tio doe tor- tik woo- Anyin- of_ hy mppropninte detailed engin-

d s ua rs . kidding doronente if falcdbabtota ~ Rpsi an inrovexena o; ja.ethfkedShIotetl 65.i thin, rote he eesosnId

seed sinoe the G-verneensderided n blild direetlink A-eee-NIfeos-Anpiyiato serve the thing9h-t-rnffkbetween 2orea end K_dei.

TOTAL 752.C rAise

Souroe: SWh'P' `peit., lans-ber 1971.PFD, N-mberei 1972 and Jaoe 1973,

PLATE

GHANA

FIRST HIGWAY PROJECT

Operating Costs (financial) for Typical

Vehicles at Various Speeds

70

H~ ~~

c1> X ^>Vehicle type 4,

360 Heavy Trucks

20 t

) 0

Vehicle tYPe 3,F tMedium 1crucks

0D30

*14

20

Vehicie type 2,Passenger/Freight Trucks

10 Vehicle type 1,Light Vehicles

0~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~10 20 30 40 5O

Vehicle Speed, mph

December 1972.

IBRD -3691

~~ t i 7 u f~t Pz Vr;@0 R ;j~~ nso > ~ f @+umo - Neur-nr

BOLGTATNG ZtottN b.

ow§ T 5 ,,p 5 f ¢ X R E o . . .............

U~~~~~P PER REGI N -... -- ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~......i % \ - 9 { j> ~~~~~~~~~~Gosmbgoqo - -lffotI"s '

C£rcnulugu I. .ov'' A 'vn < . . ..

I-~~~~~~~~~~~~~~~~~~~~~~~~~Sb. ') -. Gaowompe> t,J

Palb ~ ~ ~ ~ ~ P

'1k T N I 0 N

W:,~~~~~~~~~~~~~~~~~~C I

lb~~~ Ab.fGd

3* I g; J r , ~,L, . !;x .......... tz