Document of The World Bank

FOR OFFICIAL USE ONLY

Report No: 25590-CHA

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED LOAN

IN THE AMOUNT OF US$200 MILLION

TO THE

PEOPLE'S REPUBLIC OF CHINA

FOR A

WUHAN URBAN TRANSPORT PROJECT

February 12,2004

Transport Sector Unit East Asia and Pacific Region I This document has a restricted distribution and may be used by recipients only in the performance o f their 1 official duties. I t s contents may not otherwise be disclosed without World Bank authorization.

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ATC BRT CITC CMIS CNAO HPAB HPFB I/M MOF MPLG MVECS N M T N M V OPO PMR PPLG PSO RM RMMS RMMIS

RUE SEA SEPA T A T D M T M UTP

CURRENCY EQUIVALENTS

(Exchange Rate Effective January 2004)

Currency Unit = RMB Yuan RMB1.00 = US$0.12 US$l.OO = RMB8.28

FISCAL YEAR January 1 -- December 31

ABBREVIATIONS AND ACRONYMS

Area Traffic Control Bus Rapid Transit China International Tendering Company Computerized Management Information System China National Audit Office Hubei Provincial Audit Bureau Hubei Provincial Finance Bureau Inspection and Maintenance Ministry o f Finance Municipal Project Leading Group Motor Vehicle Emission Control Strategy Non-motorized Transport Non Motor Vehicle One Person Operation Project Management Report Provincial Project Leading Group Public Service Obligation Road Maintenance Road Maintenance Management System Road Maintenance Management Information

Road User Education Strategic Environmental Assessment State Environmental Protection Administration Technical Assistance Travel Demand Management Traffic Management Urban Transport Planning

System

V A VMS WBCC WBOB WCC WCCTPDI

WGPTC WMAB WMCIMO

WMEDRIC

WMFB WMG WPO WPTGC WPTMO WTC WUCFMO

WUCUFU PMO

WUTP WUTPLG

Vehicle-actuated Variable Message Signs Wuhan Bridge Construction Company Bank's Beijing Office Wuhan Construction Commission Wuhan Comprehensive Transport Planning

Wuhan Group Public Transport Corporation Wuhan Municipal Audit Bureau Wuhan Municipal Capital Investment

Management Office Wuhan Municipal Engineering Design &

Research Institute Company Ltd. Wuhan Municipal Finance Bureau Wuhan Municipal Government Wuhan Project Office Wuhan Public Transport Group Company Wuhan PT Monitoring Office Wuhan Transport Commission Wuhan Urban Construction Fund

Wuhan Urban Construction Utilization o f

And Design Insti tute

Management Office

Foreign Investment Project Management Office

Wuhan Urban Transport Project Wuhan Urban Transport Project Leading Group

WUTPO WUTS Wuhan Urban Transport Strategy

Wuhan Urban Transport Project Office

Vice President: Jemal-ud-din Kassum, EAPVP Country ManagedDirector: Yukon Huang, EACCF

Sector ManagedDirector: Task Team Leader/Task Manager:

Jitendra N. Bajpai, EASTR Edward Dotson, Senior Urban Transport Specialist, EASTR

FOR OFFICLAL USE ONLY

CHINA WUHAN URBAN TRANSPORT PROJECT

CONTENTS

A. Project Development Objective Page

1. Project development objective 2. K e y performance indicators

B. Strategic Context

1, Sector-related Country Assistance Strategy (CAS) goal supported by the project 2. M a i n sector issues and Government strategy 3. Sector issues to be addressed by the project and strategic choices

C. Project Description Summary

1. Project components 2. K e y pol icy and institutional reforms supported by the project 3. Benefits and target population 4. Institutional and implementation arrangements

D. Project Rationale

1. Project alternatives considered and reasons for rejection 2. Major related projects financed by the Bank andor other development agencies 3. Lessons learned and reflected in the project design 4. Indications o f borrower commitment and ownership 5. Value added o f Bank support in this project

E. Summary Project Analysis

1. Economic 2. Financial 3. Technical 4. Institutional 5. Environmental 6. Social 7. Safeguard Policies

2 2

3 3 7

9 10 11 11

13 14 15 16 16

17 17 19 20 21 23 25

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. I t s contents may not be otherwise disclosed without W o r l d Bank authorization.

F. Sustainability and Risks

1. Sustainability 2. Critical risks 3. Possible controversial aspects

G. Ma in Conditions

1. Effectiveness Condition 2. Other

H. Readiness for Implementation

1. Compliance with Bank Policies

Annexes

Annex 1: Annex 2: Annex 3: Annex 4: Annex 5: Annex 6:

Annex 7: Annex 8: Annex 9:

Project Design Summary Detailed Project Description Estimated Project Costs Cost Benefit Analysis Summary, or Cost-Effectiveness Analysis Summary Financial Summary for Revenue-Earning Project Entities, o r Financial Summary (A) Procurement Arrangements (B) Financial Management and Disbursement Arrangements Project Processing Schedule Documents in the Project File Statement o f Loans and Credits

Annex 10: Country at a Glance Annex 1 1 : Environmental Assessment Annex 12: Resettlement Annex 13: Wuhan Urban Transport Strategy Annex 14: Reform o f Public Transport

26 26 28

28 29

30

31

32 41 58 59 63 65 74 80 81 82 86 88 95

100 109

M A P ( S) 1. IBRD No. 32429 2. IBRD No. 32430 3. IBRD No. 32431

CHINA Wuhan Urban Transport Project

Project Appraisal Document East Asia and Pacific Region

EASTR

30RROWER 381.80 1 16.40 [ 398.20 [BRD

_ _ . .. - -. - I -

Borrower: PEOPLE'S REPUBLIC OF CHINA

71.00 I 129.00 I 200.00

Responsible agency: MUNICIPALITY OF WUHAN Project Office Address: No. 130 Yanjiang Ave. Hankou Wuhan China Contact Person: Hui Shu Zhi, Vice Director Tel: 86-27-85886173 Fax: 86-27-8281 1498 Email : Whj txmb@Public . Wh . Hb . Cn

rotal:

Estimated Disbursements ( Bank FYlUS$m):

452.80 I 145.40 I 598.20

Project implementation period: December 2003 - December 2008 Expected effectiveness date: 06/0 112004 Expected closing date: * 06/30/2009

A. Project Development Objective

1. Project development objective: (see Annex 1)

The Wuhan Urban Transport Project will promote the development o f an integrated, efficient, and sustainable transport system for the movement o f people (especially the poorer sections o f society) and goods in Wuhan. More specifically, the project aims to support:

(i) Investments in transport infrastructure and services that address the needs o f the existing system - in particular, the issues related to capacity, safety and sustainability, and mobi l i ty o f users, (particularly the most vulnerable sections o f society) within a long-term framework provided by the approved Master Plan Formulation o f a transport strategy to guide investment decisions Reforms to improve performance o f bus service delivery.

(ii) (iii)

2. K e y performance indicators: (see Annex 1)

The key performance indicators to measure the progress on each o f the three project development objectives are listed below (see Annex 1):

(i) Investments in transport infrastructure and services 0 Capacity and EfJiciency: to evaluate improvements in

- -

Travel times o n key external/cross town, cross r iver and central area routes Average daily ridership o n the bus system

0 Mobility: reduction in travel times for users o f most heavily used modes o f transport

0 Sustainability: -

Management System (RMMS) -

Implementation o f annual road maintenance plans based o n the Road Maintenance

Formulation and adoption o f an effective motor vehicle emission control strategy

(ii) Support for the Wuhan Urban Transport Strategy (WUTS) through the fol lowing measures: 0

0

0

Further detailed studies as proposed in the W U T S Study Report Preparation o f a transport pol icy “White Paper” Identification o f Five year investment programs

(iii) Bus system reform through 0 Completion o f bus route tendering o n a competitive basis across the bus system

The Wuhan Municipal Government (WMG) agreed with these performance indicators at negotiations. For the road safety interventions in the project, as it i s technically not possible to forecast the expected reduction in the incidence and severity o f accidents, particularly among pedestrians and non-motorized transport (NMT) users, no indicator could be agreed. However the interventions will be monitored and evaluated.

- 2 -

B. Strategic Context 1. Sector-related Coun t ry Assistance Strategy (CAS) goal supported by the project: (see Annex 1) Document number: R2002-02 18 [IFC/R2002-02241 Date of latest CAS discussion: 12/19/02

The C A S supports China’s transition f rom a rural, agricultural society to an urban, industrial society, and from a centrally planned to a more globally integrated market-based economy. The CAS also notes the growing concerns about the social consequences and sustainability o f China’s economic growth. These economic trends, at the core o f China’s Tenth Five-year Plan, also form the basis for the three themes o f Bank’s operation strategy in China, namely to: (1) Improve the business environment and help accelerate China’s transition to a market economy (2) Address the needs o f the poorer and disadvantaged people and regions (3) Facilitate a more environmentally sustainable development process

The Wuhan Urban Transport Project (WUTP) would enhance the urban efficiency and mobil i ty within an important medium sized ci ty situated in the center o f China, and encourage a market-based delivery o f urban transport services, particularly public transport.

The physical and institutional elements o f the project address the three CAS themes. Development o f a sustainable and balanced urban transport system would improve the business environment and labor mobil i ty in Wuhan. Reform o f state owned bus companies and introduction o f competition in the supply o f bus services would accelerate China’s transition to a market economy. The project also supports improvement in safety o f transport facilities and mobi l i ty o f the economically disadvantaged through investments in traffic management measures, and improved facilities for pedestrians, NMT and public transit. Finally, the development o f a comprehensive emission mitigation program would promote an environmentally sustainable development process.

2. M a i n sector issues and Government strategy:

2.1 Main Sector Issues.

2.1.1 R a p i d growth in urbanizat ion and motorization. Both trends are actively encouraged by the central government and expected to grow further in the foreseeable future. The urban population in China i s projected to increase from 30.2 percent (3 19 mil l ion) in 1995 to 49.1 percent of the total population (71 1.7 mil l ion) in 2020. Car ownership, which has increased rapidly in the last decade, i s projected to increase tenfold f rom a current average o f 10 to 100 per 1000 residents in 2020. Both trends are also true o f Wuhan: the city’s Master Plan projects an increase in the city’s population from 3.9 mi l l ion in 1998 to 4.5 mi l l ion in 2020. Similarly, auto-ownership rates in the urban districts o f Wuhan increased f rom 56 motor vehicles per 1,000 residents in 1998 to 99 per 1,000 in 2001 and are projected to increase to 1 16 in 2010 and 167 in 2020. Per-capita travel i s expected to increase accordingly: f rom 1.98 tr ipdday in 1998 to 2.41 in 2010 and 2.65 in 2020. Economic opportunities in growing Chinese cities l ike Wuhan are extensive, and if ‘hukou ’ related restrictions to urban migration are relaxed it i s l ikely that growth in the ci ty could be even greater.

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2.1.2 Accelerated investment in road capacity without adequate planning. Rapid increase in population and number o f vehicles i s overwhelming the urban transport infrastructure in Wuhan, which typifies the general experience o f most Chinese cities. I t s transport infrastructure i s overburdened, and the last decade saw a decline in mobil i ty for most classes o f urban trips. C i ty authorities in Wuhan are addressing these issues primari ly with an ambitious road construction program. Significant local financing i s available f rom domestic banks for investments in road expansion.

However, th i s ‘solution’ creates as many problems as it solves. First and foremost, mobi l i ty on non-motorized modes i s further degraded. Secondly, the planning process i s not systematic and comprehensive, and does not assure that a we l l thought out, properly prioritized road-building program emerges f rom what starts (as i s the case elsewhere in the world) as a l i s t o f perceived priorities. Perhaps the most important challenge in Wuhan (and in other similar Chinese cities) is to ensure that the sign8cant investments that wi l l be made in urban infiastructure in the coming two decades, w i l l eficiently enhance the mobility and safety of residents in a sustainable manner.

While the description that follows i s particular to Wuhan, it i s equally true o f many other Chinese cities.

2.2 About Wuhan

Wuhan, the capital of Hubei Province, i s one o f the foremost centers of economic growth outside the coastal regions o f China. The Yangtze and Han rivers divide the city o f Wuhan into the three towns o f Wuchang, Hankou and Hanyang. In 1998, the GDP o f this industrial, commercial and trade center was FWB 101.5 billion. The average GDP growth from 1990 to 1998 was 15.3 percent higher than the national average. The city’s economy is expected to grow at 7 percent to 9 percent annually in the near future.

2.3 Trends in mobility

2.3.1 Declining pedestrian and cyclist mobility. Though s t i l l significant (37 percent pedestrian and 29 percent bicycle trips together accounted for two-thirds of al l trips in Wuhan in a 1998 survey), the mobi l i ty o f pedestrians and cyclists i s declining, as motor vehicles progressively dominate the roads. NMT, traditionally the mainstay o f urban transport in Chinese cities and s t i l l the mainstay of the poorer sections o f the society, currently suffers f rom inadequate attention from ci ty transport planners. This is particularly true f rom a safety perspective: pedestrian crossings are limited, traffic management for cyclists i s based mainly on control and prohibition, there are no NMT networks, and cyclists are often forced to operate in dangerous mixed traffic. The construction o f new roads, built essentially to accommodate automobiles, is aggravating these problems.

2.3.2 Traffic congestion resulting from inadequate capacity and poor management. The road network remains inadequate and overburdened by the increase in the number o f motor vehicles. Though increasing in numbers, motor vehicles accounted for only 12 percent o f a l l trips in 1998. The functional road hierarchy i s incomplete and ill-defined resulting in most traffic being loaded onto a few major arterials, key l m k s in the network are missing, and traffic management (signals, channelization) i s l imited and often inadequate (long cycle times, no red aspects at 20 percent o f the signaled junctions). Encroachment from businesses and parking further exacerbates this shortage. In

- 4 -

Wuhan, three specific forms o f traffic significantly increase congestion: traffic associated with the Hankou town centre, cross-river traffic in the city core that principally uses two Yangtse r iver crossings, and some o f the through and intemal traffic that comes through the ci ty center.

2.3.3 Inadequately maintained roads. Maintenance budgets typically provide only 40 percent o f what is, in fact, required. M u c h o f this provision goes towards staff salaries, leaving little for road maintenance. There i s n o systematic maintenance or asset management system in place. Organizationally, government and operator functions are combined in public maintenance units and a number o f different government organizations are responsible for road maintenance and reconstruction.

2.3.4 Public transport requires much-needed attention. Though public transport i s important and growing (buses accounted for a 22 percent share o f trips in 1998 and this i s forecast to grow significantly, both in share and volumes), the sector i s beset by the fol lowing problems/concems/issues: 0 Limited network coverage - Despite a substantial number o f bus services (in 2001 there were seven bus companies, operating 5500 buses o n 244 routes over 4300 kms), the overall coverage i s limited. The route network needs revision: most bus routes are in the city center while the extensive new developments on the urban fringe are poorly served. Routes run primari ly along arterial roads and access often requires long walks. 0 Poor on-street management - Bus volumes are unusually high o n primary routes (approaching 500 per hour o n main corridors and the Yangtse river bridges), stops are congested, and on-street management o f buses i s poor. 0

o f public transport depot and terminal facilities. Buses often have to be parked o n the streets and poorly planned terminals impede efficient transfers. 0 Unclear institutional roles - Institutional problems are s imi lar to other Chinese cities. Though plans for reform are being finalized, the roles and responsibilities between the municipality and the bus companies need clarification. Buses do not operate within a competitive/market-based environment. 0

(excluding capital costs), in the six state-owned bus companies (the seventh i s a jo int venture with a Hong Kong company).

o f a rai l network o f six metro lines. The init ial elevated line i s currently under construction. However there appears to have been little integration o f ra i l and bus service planning.

Shortage of depot and terminal facilities - More than other cities, Wuhan suffers f rom a shortage

Low fares - Fares are low, though they cover more than 90 percent o f the operating cost

Lack of integrated networkplanning - The municipality has an ambitious plan for the construction

2.4 Institutional structure and Policymaking

2.4.1 Urban transport i s largely the responsibility of the municipal government - the provincial and state governments have a relatively minor role. The municipal government i s responsible for planning, financing, and implementing al l infrastructure, and also for operations and policy.

2.4.2 Investments in transport infrastructure are directed by a 20-year Urban Transport Master Plan developed by the municipal government. The Master Plan i s a legal document that needs to be approved by the State Council (in the case o f cities with a population o f over 1 million). In theory, th is structure i s meant to ensure continuity in the planning process and bolster technical integrity over political expediency. In practice, the task team’s experience indicates that it i s in fact short-term political expediency that prevails. The Twenty-year Master Plan i s a non-fiscally constrained

- 5 -

investment p lan without any systematic processes for the planning, programming and budgeting o f investments. There are no requirements or incentives in the plan to formulate or implement integrated and modally balanced transport policy. Further, once a plan i s approved, local authorities retain significant latitude to set priorities and timings for individual projects.

2.4.3 Most transport planning and policymaking occurs in an unsystematic ad-hoc manner. There i s a mult ipl ici ty o f uncoordinated agencies, with little day-to-day contact, involved in aspects o f urban transport planning and operations. They include, the Urban Planning Bureau, the Municipal Construction Bureau, (responsible for road construction and maintenance), the Wuhan Transport Commission (responsible for public transport provision and regulation), the Traffic Police (responsible for traffic management and enforcement) and the Environmental Protection Bureau (responsible for vehicle emission controls).

These (and other) agencies are bound by few controls or requirements that would, otherwise, ensure coordinated formulation and implementation o f transport planning and policy. For example: 0 A dearth of stablefinancing sources, particularly for maintenance o f existing infrastructure. When funds for construction are needed, the city has considerable leeway to institute new special purpose taxes but maintenance i s often ignored. 0 Land-use planning and transport planning processes operate completely independently o f each other and are no t integrated in any manner. 0 Tools exist but are not used optimally. Wuhan has relatively good data: Origin Destination household survey data (1998), motor vehicle OD data (1999), bicycle and taxi use data (2001) and data f rom surveys o f major bus terminals. A travel demand model has been built to forecast travel demand for 20 10 and 2020, and assignments made to the Master Plan road network. A separate study was undertaken to define the rai l network. However these studies were not used to test the Master Plan transport proposals or to define the investment plans for 2005 or 20 10.

2.5 Road Safety

Modal sh i f t towards a larger use o f motor vehicles has heightened the road safety concerns in Wuhan. The incidence and severity o f accidents are high, even when compared with other cities o f similar population and motorization within China. Road accidents appear to be largely due to increased speeds and volumes o f vehicles, poor driver behavior and poor road sense o f pedestrians. In 2001, the total number o f road accidents was 11,595 with 631 persons k i l led and 7,517 persons seriously injured. Economic losses (excluding the costs o f pain, grief and suffering and projected contribution to society) were RMB 26 mil l ion. Since 1999, the number o f road accidents has declined slightly while the number o f fatalities and casualties have remained stable. In Wuhan Municipality, 80 percent o f accidents occur in urban areas with 50 percent considered fatal. The fatality rate/million population in 2000 was 90, compared to 55 in Shanghai (1999).

- 6 -

2.6 Air and Noise Quality

Vehicular emissions are not a serious issue, except in areas close to main roads, where particulates are a problem despite lead-free fuel used since 1998. The ci ty government has a basic emissions control strategy in place. National vehicle emission standards are enforced through an annual testing and inspection system complemented (since 2000) with spot random checks. The city government has started planning a modeling effort to quantify the contribution o f different sources to air pollution. Noise is also considered a severe problem in the urban center and the government i s working o n strategies to lessen the noise impact o f .motor vehicles.

2.7 Government Strategy

Urban transport issues are largely the domain o f the local Wuhan Municipal Government (WMG), which i s currently focusing o n accelerating expansion o f the road network. In the past, it was the political leadership that made the decisions regarding new road construction, with technical analysis playing a subservient role (if any). Though a new generation o f planners equipped with adequate analytical tools exists in Wuhan, they lack the experience and influence to be effective.

Apart f rom new road construction, the most significant urban transport initiative undertaken by WMG i s the construction o f a light-rail line. In terms o f bus transport, W G has been working o n reorganizing the bus transport sector since 1999. In October 2001 the overall responsibility for system planning was moved to the newly created Wuhan Transport Commission (WTC). The WTC has outlined a program for reform, which was recently approved by WMG. A summary i s presented in Annex 13.

The Government has also implemented a series o f pol icy measures related to urban transport. N e w motorcycle registrations have been banned since mid-2002. In early 2003, the city banned ‘mamus ’ (motorized three-wheeled jitneys).

The reason behind the government ban o n motorcycles i s unclear. Before the ban, motorcycles were a popular mode o f transport (registrations grew at 27 percent over the 199 1-200 1 decade and by 200 1 accounted for over ha l f o f the 447,505 registered motor vehicles in the municipality). Though there are val id safety issues related to their use, motorcycles present a relatively cheap and efficient (in terms o f energy and use o f road space) altemative to autos that fu l f i l l s many o f the same aspirations for personal mobility. Though no systematic analysis i s available, it i s unl ikely that banning motorcycles outright without accompanying automobile related restraints would offer a sustainable solution to congestion problems.

3. Sector issues to be addressed by the project and strategic choices:

3.1 Sector Issues to be addressed The most important sector issue that this project addresses i s the institutional coordination across agencies and modal policies.

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The aim o f the project i s to develop W T S into aphased andfinancially constrainedprogram of investments and policies based on systematic analysis and inputs f rom al l concemed stakeholders (details in Annex 14). In addition, t h i s project will support institutional reform in the provision of public transport services in Wuhan, based o n the proposals outlined by WTC. The physical investments, proposed in the project, address the key issues identified in WUTS, in particular: 0

l inks, and implementing traffic management and road safety programs 0

new footways and pedestrian crossing facilities 0

sustainable development 0

capacity and implementing integrated traffic management measures

maintenance o n part o f the existing Wuhan road network 0

infrastructure (termini, bus-stops) as we l l as computer management systems 0

Enhancingpedestrian and NMT safety by constructing new road infrastructure and missing road

EnhancingpedestriadNMT mobility by financing a network o f pedestrianiNMT routes including

Developing a road network with a rationale structure and clear functional hierarchy that supports

Reducing traffic congestion and enhancing mobil i ty and safety for vehicle users by increasing road

Improving road maintenance by procuring road maintenance equipment and financing

Improving the quality ofpublic transport service by financing investments in physical

Improving air quality by facilitating implementation o f a motor vehicle emissions control strategy

3.2 Strategic Choices The organization o f the project, and the selection o f i ts components and appropriate funding levels reflect three strategic decisions.

3.2. I transport projects in China, it was necessary to encourage an integrated multi-modal approach in the Wuhan project, essentially to ensure that the funding program for the project reflects the immediate needs o f all modes, and addresses the key negative impacts o f transport. Developing a complex multi-faceted project was the only credible way to bring al l the various agencies, which provide urban transport services in the city, to work together towards an integrated transport vision that reflects the needs of al l o f Wuhan.

Encouraging an integrated multi-sectoral approach. As in previous Bank financed urban

3.2.2 the most useful and innovative support that the Bank can give to WMG, since i t will provide the basis for long term rational decision making on transport investments, and improved service delivery. It wil l also leave behind a legacy o f tools and empowered professionals who understand the value o f systematic analysis in supporting, advocating or opposing ideas as appropriate.

Focusing on the strategy as the centralprocess innovation. The team considers this to be

3.2.3 Selectivity: focusing on public transport reform. An integrated multi-modal project, such as this, needs to choose issues carefully. There were many policy, investment and process issues where the Bank could have added value - such as the proposed ra i l system, integrating land-use and transport planning, pricing-based demand management measures, or sustainable user-charged financing mechanisms. However, the project focuses o n two primary reforms: the development o f an integrated approach to transport planning based o n a systematic transport strategy, and public transport reform.

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C. Project Description Summary 1. Project components (see Annex 2 for a detailed description and Annex 3 for a detailed cost breakdown):

The proposed project has six components as described below:

Component 1: Road network development. This component addresses the immediate need to improve the road network operations within the city, and to expand the bicycle and pedestrian networks. The five programs, within the component, are designed to: 0

0

0

0

0

The c iv i l works for these five programs include the construction o f new primary, arterial and local roads, upgrading/widening o f existing roads, construction o f interchanges and construction o f pedestrian overbridges or underpasses.

provide suitable routes for through or cross-town traffic improve utilization o f existing cross-river bridges relieve congestion in central down-town areas provide adequate road networks in development areas provide safe conditions for pedestrians

Component 2: Traffic management and road safety. The aim o f this component i s to build upon the strengths o f the existing transport network management to better utilize existing assets and resources. The detailed content includes 0 pedestrian and bicycle measures 0 bus priori ty measures 0 channelization o f junctions 0

0

0

0 road marking equipment

provision o f traffic signals at junctions and an urban area traffic control (ATC) system a road safety and accident analysis program a road user education program

Component 3: Public transport. The objective o f th i s component i s to facilitate an increase in the efficiency and effectiveness o f bus services in the city. A key element o f the effort related to public transport i s support for the ongoing reform o f public transport operations. The physical investments related to this component include: 0 a Computerized Management Information System (CMIS) to increase the efficiency o f operators in

routine administrative and technical tasks, and a GPS based bus location system to improve the on-street management o f bus operations

0 construction o f passenger facilities, including bus interchange stations, bus terminals and bus stop bays The component also includes studies o f bus priori ty and bus rapid transit measures o n selected corridors. Provision i s made for the implementation o f a pi lot Bus Rapid Transit (BRT) scheme, if considered viable.

Component 4: Road maintenance. This component aims to: 0

0

assist the government's intent to reform and improve the current road maintenance management through training and study for Road Maintenance Management Information System (RMMIS) improve the current road maintenance facilities by purchasing advanced road maintenance equipment reconstruct the most damaged road sections in Wuhan.

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Component 5: Environmental management. The aim o f this component i s to mitigate the adverse impacts of road construction, minimize vehicle emission, and increase the positive environmental impacts o f the project. The detailed content includes: 0

0 planting along new roads 0

0

0

constructing noise barriers and other facilities to mitigate noise f rom the new roads

expanding the vehicle emission and traffic noise monitoring system facilitating implementation o f a motor vehicle emission control strategy upgrading the vehicle inspection and maintenance (I/M) system.

6. Capacity building and TA Total Project Costs

Front-end fee Interest during construction

Total Financing Required

Component 6: Capacity Building and Technical Assistance (TA). This component will strengthen the technical and management ski l ls o f the municipal staff, and includes: 0

0

0

domestic and intemational training for officials f rom project implementing agencies funding for consultant studies o n issues and topics related to the other five components o f the project office equipment to enhance the productivity o f the implementing agencies

7.90 1.3 7.20 3.6 579.80 96.9 198.00 99.0

16.40 2.7 0.00 0.0 2.00 0.3 2.00 1 .o

598.20 100.0 200.00 100.0

4. Road maintenance 5. Environmental management

2. Key policy and institutional reforms supported by the project:

The project will seek to promote pol icy and institutional reforms in two major areas.

2.1 The development of an integrated approach to transport planning based on a systematic transport strategy. The project will seek to assist WMG in 0

0

0

establishing a pol icy and institutional framework for integrated urban transport investment and management improving the procedures for funding allocation to different modes developing opportunities that will al low different planning agencies to work together. Assistance will also be given to develop an init ial investment strategy and procedures for subsequent updates o f the plan. Details o f the strategy are available in Annex 14.

- 1 0 -

2.2 The regulatory and planning framework for public transport. The project wil l aim to support WMG’s reform efforts to: 0

0

0

0

0

separate the responsibilities o f govemment f rom those o f the operators establish a new operational and managerial system that encourages competition and provides higher quality transport services use market mechanisms to attract funding from sources other than the municipal government improve the P T regulatory framework, especially to establish a bus route franchising pol icy promote integration o f ra i l and bus services and promote bus rapid transit services in the city

Details o f WMG plans are available in Annex 13.

3. Benefits and target population:

The project i s expected to benefit a l l users o f the urban transport system, in a l l income groups. Major benefits will include: 0 saving o f personal travel time and freight time for al l road users as a result o f reduced traffic

delays and improvements in road maintenance 0 improved travel comfort and convenience for bus users 0 improved travel comfort and safety for pedestrians and non-motorized vehicle users 0 increased road maintenance finding and reduced maintenance costs which will reduce operating

costs for a l l vehicle owners 0 reduced vehicle emissions

To ensure that the project i s indeed designed to maximize the benefits to the economically and socially disadvantaged, the team has conducted a survey o f the travel pattems and needs o f the vulnerable groups (the economically disadvantaged, women, and recent migrants) in Wuhan. Results f rom th is study will be used in the detailed design of project components during implementation.

In addition, WMG transport planning and operating staff are expected to benefit f rom the extensive capacity building components o f the project.

4. Institutional and implementation arrangements:

4.1 Executing Agency. The project will be executed by the Wuhan Municipal Government (WMG). WMG has established a project team, comprising of technical staff f rom the concemed government agencies, to oversee the preparation and implementation o f the project. The Wuhan Municipal Capital Investment Management Office (WMCIMO) will have overall responsibility for the preparation and implementation of the project. The Wuhan Urban Transport Project Off ice (WUTPO), under WMCIMO, will be responsible for managing and coordinating the implementation o f the project by the various implementing agencies.

4.2 Project Guidance. At the municipal level the Wuhan Urban Transport Project Leading Group (WUTPLG) has been established to provide overall guidance to W U T P O in project preparation and implementation.

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4.3 Implementing Agencies. Responsibility for implementation o f the individual components will be as follows:

Component Responsible Agency

Road Infrastructure Wuhan Bridge Construction Company (WBCC) - a Unit o f W M C I M O .

Public Transport Wuhan Transport Commission (with the participation o f Wuhan Group Public Transport Corporation (WGPTC) for the C M I S

Traffic Management Public Security Bureau

Road Maintenance W B C C for c iv i l work

Wuhan Urban Management Bureau for RM Reform, RM Management Information System, and Equipment Procurement

Environmental Management Municipal Environment Bureau

Institutional Development & TA Individual implementing agencies will each manage their own TA. The Project Office (WUTPO) will have responsibility for procurement.

Subproject offices have been established in each o f the implementing agencies.

4.4 Funds Flow. The Ministry o f Finance (MOF) will on-lend Wor ld Bank loan funds to the Hubei Province Government (through the Provincial Financial Bureau). The Provincial Financial Bureau will in tum on-lend funds to WMG (through the Municipal Financial Bureau), which will in turn on-lend funds to W M C I M O . W M C I M O will act as the representative o f the municipal government to manage the loan and ensure future repayment. The sources of counterpart funds and repayment are the municipal budget and extra budget sources, which have been analyzed in section E and Annex 5. Loan type will be LIBOR-based Variable-spread loan and use U S dollar as single currency.

5. Project Management Activities

5.1 Procurement, The project office will be responsible for oversight and coordination o f procurement activities during the implementation o f the project. A division has been established and the Bank team has provided some basic training to the staff. The subproject offices for each component have also allocated staff to assist in the procurement activities. The Bank will provide further training to staff in these offices. A procurement plan has been developed as part o f the Project Implementation Plan (PIP).

5.2 Financial management. The project office will be responsible for a l l activities o f financial management,

5.3 Environment. Responsibilities for a l l environmental management activities are included in the Environmental Management Plan (EMP).

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5.4 Resettlement. Responsibilities for implementation o f resettlement are documented in the Resettlement Act ion Plan (RAP).

5.5 Construction supervision. The project will use Bank funds to hire c iv i l work supervision teams to undertake construction supervision and quality control o f c iv i l works. Since the Wuhan Bridge Company (WBC) will be the implementing agency for c iv i l works under the road network improvement and road maintenance components, W B C will also have overall responsibility for construction supervision for al l components. W B C will act as the owner o f the c iv i l works during construction. WBC will select a construction supervision consultant team to act as the chief engineer, responsible for quality and contract management and hiring o f site engineers. W B C wil l also hire a small intemational consultant team to act as advisors to WBC, to provide training in F ID ICBank construction supervision responsibilities and procedures, and to set up a client/engineer/contractor management procedure in the f i rst year. A small team o f local consultants will supervise the init ial c iv i l works contracts during the f i rs t year o f the project. Construction supervision consultant services for al l future years wil l be open to intemational and local consultant companies.

5.6 Project Implementation Plan (PIP). Each implementing agency has prepared a PIP for i t s respective component, based o n which W U T P O has prepared a comprehensive PIP. The PIP will guide the implementation o f the project and will be updated as required by WUTPO with the help o f each sub-project office.

5.7 Progress Reporting and Planning. WUTPO will be responsible for preparing quarterly and annual progress reports and annual implementation programs, based on inputs from the subproject offices. The quarterly reports will focus o n physical and financial progress, outline implementation problems for al l components, and suggest corrective actions. The Annual Progress Report will be used to review the progress achieved in the preceding year, update the PIP, and set out the implementation program for the fol lowing year. H a l f way through the implementation period (around M a y 2006), there will be a mid-term review, which wil l consider if any major changes are required in the project structure.

D. Project Rationale 1. Project alternatives considered and reasons for rejection:

Various alternatives were considered and explored for the scope and size o f the project, and also for the financing levels o f individual components. Different alternatives were also assessed for the selection o f schemes within each component, particularly the road network development component.

1.1 Project scope, size, and component financing levels Project Scope. The init ial investment proposal presented by Wuhan municipality focused mainly o n road infrastructure. The Bank, however, expressed i t s concern over the limited scope o f the project. Subsequently, a more comprehensive urban transport improvement program was developed by WMG.

Allocation between components. The allocation presented in section C was a result o f (i) feasibility studies conducted by individual implementing agencies to define the minimum and desirable levels o f investment for each component; and (ii) discussions with WMG to determine the level o f investment to components 2 through 6 (all components except road network development).

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1.2 Selection of schemes

Sector Issue

Road component. The road development schemes were selected from a l i s t generated by WMG. The schemes were tested extensively, prior to their selection, using the network analysis modeling tool, developed as part o f the transport strategy development effort. As a result o f this analysis WMG dropped some schemes that it was initially committed to, including the eastern leg o f the middle ring road in Wuchang. Almost al l o f the infrastructure investment has been finalized. Additional analysis o f traffic demand, costs, benefits and desirable construction dates o f the remaining schemes will be undertaken in the init ial implementation period o f the project to select and prioritize the most appropriate schemes for assistance.

Project

The public transport component. Extensive bus priority measures, including a busway, were considered. In i t ia l analysis suggested that bus priority measures could not be technically justified at this stage. On major corridors f lows o f up to 500 buseshour dominate the available road space and there i s n o evidence (to support bus priority) o f buses being unduly delayed by other traffic. However, provision has been made for further analysis and for the detailed design and implementation o f any resulting l imited priori ty measures that may be needed. Further studies are proposed to include one o f BRT alternatives, which takes account o f LRT/Metro lines.

2. Major related projects financed by the Bank and/or other development agencies (completed, ongoing and planned).

3an k-financed Sector issues in a l l projects are generally those listed in section B2.

Shanghai Metropolitan Transport Project I (completed) 1992

Shanghai Metropolitan Transport Project I1 (completed) 1993

Guangzhou C i ty Center Transport Project (ongoing) 1998

Liaoning Urban Transport Project (ongoing) 1999

Urumqi Urban Transport Project (ongoing) 2000

Shijiazhuang Urban Transport Project (ongoing) 200 1

)ther development agencies '/DO Ratings: HS (Highly Satisfactory), S (Satisfactory), U (Unsatisfactory), I-

Latest Supervision (PSR) Ratings

[Bank-financed projects only) Implementation

Progress (IP)

S

S

S .

S

S

S

(Highly Unsatis

Development Objective (DO)

S

S

S

S

S

S

ctory)

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3. Lessons learned and reflected in the project design:

Use fu l lessons can b e d r a w n from the experiences o f two completed urban transport projects financed by the B a n k in Shanghai, and four ongoing projects in China - Guangzhou, Liaoning, Urumqi and Shijiazhuang.

3.1 The need for an integrated multi-modal approach Typical ly there was an over-reliance on roads with little systematic planning and appreciation for integrated solutions consisting o f traffic management, facilities for pedestrians and cyclists, public transport, improved road maintenance and financing, and supporting institutional structure. The key challenge for the Bank team was to work with municipal authorities to broaden the scope o f client-identified investments to include other dimensions that can address the traffic congestion problem that the Bank would consider sustainable.

During the preparation phase the init ial request for a set o f road schemes has been transformed into a truly integrated project with two process innovations for China: the development o f strategy and the public transport reform.

3.2 Participation o f decision makers The mayor and the directors o f the major government agencies concerned have a very important decision making role in any urban transport project. Therefore one o f the main tasks for the Bank has been to gain the support o f municipal government, especially the key decision makers. In Wuhan, the Bank was able to persuade WMG to appoint a Vice-Mayor to lead the transport strategy development effort. This has been crucial in getting buy-in from the city on the planning process and i t s outputs.

3.3 Participation of agencies with a stake in urban transport The key to developing a balanced and sustainable project i s the active participation o f a l l institutions responsible for urban transport. The level o f institutional participation in Wuhan was exemplary throughout the project preparation phase. In fact, the degree o f institutional involvement and commitment was higher in Wuhan than in projects elsewhere.

3.4 Managerial and technical capacity building of municipal staff There was a need to complement the high level o f technical knowledge demonstrated by the local team in Wuhan with practical experience. The Bank team facilitated the provision o f hands-on advice and support f rom seasoned professionals in the preparation stage to empower the local professionals. This effort has been very successful and has resulted in the development and gradual acceptance o f the transport strategy.

3.5 Focus on key process innovation outcomes An integrated project with multi-components (in the case o f W U T P components such as road development, publ ic transport, traffic management, road safety, road maintenance, environment, and institution building) runs the risk o f running into management difficulties during i t s implementation. The proposed project would therefore focus on key issues o f developing a viable transport strategy and promoting reforms in the delivery o f public transport in Wuhan.

3.6 Traffic management The traffic police, responsible for traffic operations and enforcement, often have l imited experience and appreciation o f comprehensive traffic management. The Bank’s past experience with transport projects indicates the need to integrate traffic management with project sponsored investments in Area Traffic

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Control (ATC) systems in order to obtain the interest and buy-in o f the traffic police. In this project, the traffic police have demonstrated a good level o f knowledge o f traffic management, and hence the project focuses more on building ownership and coordination during implementation. The project component supporting ATC systems has the most substantive and detailed traffic management plans o f any Bank-funded urban transport project in China.

3.7 Unprecedented motorization rate The current motorization rates in Chinese cities are higher than rates elsewhere in the world. Previous projects have found their forecasts to be overly conservative. Similarly, earlier projects found that they underestimated bicycle traffic volumes. Experience indicates that NMT increases with a city's growth. The forecasts o f traffic used for this project, reflect the overall trend in China.

3.8 Appreciation for rail over bus transport solutions An interest in public transport often takes the form o f investments in rail. The Bank, however, helps to focus attention o n bus system improvements, bus priori ty measures and busways. This project would a im to demonstrate the benefit o f considering both rail-based and bus-based mass transit solutions.

3.9 Ownership of reform agenda Reform o f municipal services remains an important issue on the government agenda. But the pace o f reform i s govemed by local agencies and national political conditions. The Bank can only encourage reform measures that have worked elsewhere, while the client should be willing to seek Bank assistance for i t s implementation. The Bank i s encouraging the reform o f public transport in Wuhan.

4. Indications of borrower commitment and ownership:

There i s little doubt that the borrower is committed to the success o f the Bank project in general. At both the provincial and city levels, groups comprising o f senior government officials have been established to facilitate coordination for this project. There i s also a clear indication o f borrower commitment to, and ownership of, both the physical and institutional elements o f the project. All the major physical investment components have been proposed by the WMG. As stated earlier, the level o f engagemenu initiative shown by the counterpart in the design o f the traffic management component has been exemplary. In the case o f the institutional components, the borrower has proposed the public transport reform component and the Bank's role has been one o f adviser and facilitator. In the case o f the integrated transport strategy, WMG has shown a high level o f commitment and ownership by creating a project office with staff from al l concemed agencies. The project office has undertaken a considerable amount o f analytical and design work for the project with l imited help f rom local consultants. The best indicator o f WMG's ownership o f the transport strategy development process has been their decision to drop plans to construct an eastern leg o f the middle ring road, which was at one time a major part o f the road component, based o n the results f rom the network analysis.

5. Value added of Bank support in this project:

In general, the Bank's value-added support in any urban transport project i s that o f promoting a comprehensive approach to finding solutions based o n the best practice experience in China and elsewhere. This advice also reflects the Bank's recently completed review o f Urban Transport. Moreover, the Bank will demonstrate the benefits o f participatory planning and budgeting processes, and the use o f methodologies for prioritization o f policies, programs and investments. The project provided al l concemed agencies the opportunity to jo int ly find solutions to any issues. Bank involvement wil l improve the

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institutional capacity, managerial and technical abilities in a l l concerned agencies, and further their practical experience. This directly strengthens municipal management and improves service delivery. Bank involvement also provides access to low-cost finance. It helps the government to provide more support to lower income groups by developing surveys, which provide data o n their needs. I t also assists the sectoral reform process, including the introduction o f private sector participation in service delivery.

E. Summary Project Analysis (Detailed assessments are in the project file, see Annex 8)

1. Economic (see Annex 4): 0 Cost benefit NPV=US$706 million; ERR = 23 % (see Annex 4) 0 Cost effectiveness 0 Other (specify) Economic analysis was carried out f irst for the evaluation o f altemative transport development programs, and then for the evaluation o f the proposed project. During the transport strategic planning process, four altemative development programs up to year 2007 were tested using a travel demand model calibrated with local data. These alternatives included (i) do-minimum; (ii) traffic management oriented program; (iii) public transit oriented program including mass rai l transit; and (iv) road transport oriented program. By comparing alternative terms o f traffic performance, investment costs, and economic rate o f return, a preferred program was subsequently formulated. A budget-constrained investment program for the period 2003-07 was identified. The Bank funded project was defined f rom this program.

A cost-benefit analysis was undertaken to evaluate the components o f the proposed Bank project. The quantified network benefits included savings in personal travel time and vehicle operating costs, and overall reductions in traffic accidents. These benefits represent the majority o f the total project benefits, and were estimated using the travel demand model developed for Wuhan.

The ERR was calculated based o n savings in personal travel time and vehicle operating costs against the total project costs. The ERR, under the most l ikely traffic growth scenario, i s 19 percent. Sensitivity tests were performed using altemative traffic growth rates, l ikely cost overruns, l ikely benefit reductions, o r a combination o f a l l these. The test results suggest that the project economic viability i s robust. Moreover, the review o f benefit distribution among different income groups shows that al l modes wil l benefit f rom the project. Pedestrians and bicyclists will be the prime recipients o f the safety benefits realized from the traffic management component o f the project.

2. Financial (see Annex 4 and Annex 5): NPV=US$ million; FRR = % (see Annex 4)

Fiscal Impact:

Municipal Finance. The analysis has focused o n two aspects: (a) the municipal financial capacity to provide funds for the Wuhan Urban Transport Strategy (WUTS), and (b) the counterpart funds for the project.

2.1 financial capacity. The scope of the assessment included the current and projected fiscal income and expenditure, urban infrastructure revenue and expenditure, and the capacity remaining for capital investment outside the Bank project. The municipal financial ability o f Wuhan i s ranked in the middle o f the range when compared with similar size cities in China. The revenue available to Wuhan municipality was RMB 10 bi l l ion in 2002 (see details in Annex 5). L i k e other Chinese cities, the municipality has

Municipalfinancial capacity. The task team has conducted a detailed assessment o f municipal

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adopted an approach o f balancing expenditure o n urban infrastructure with revenue f rom in-budget and extra-budget sources. The municipality f irst uses the overall infrastructure revenues to pay for routine urban infrastructure expenditures, and then allocates the remaining funds for major capital investment. The capital investment funding for the municipality i s FZMB 1.24 bi l l ion in 2003.

2.2 Municipal capital investment capacity. During the early stages o f the Wuhan Urban Transport Strategy Study, the municipality proposed a very ambitious investment plan to improve the urban transport system in Wuhan. However, this plan far exceeded the municipal financial capacity. The local planning team, with the help o f the Bank team, prioritized the l i s t o f proposals in the urban transport infrastructure investment plan, keeping in mind the given municipal financial constraints and the needs o f different road users, especially the lower income groups. More importantly, the joint team explained the financially constrained situation to the municipal decision makers, and obtained their agreement to use the l imited funds to provide services to solve the major urban transport problems identified in the WUTS. Other than the Bank urban transport project, the municipal government i s proposing a Metro L ine 1 (phases I and II), a cross r iver tunnel, and a waste water plant project (financed by ADB) as the major capital investments for the next five years (see details in Annex 5).

2.3 thirds o f the city's capital investment capacity in the first two years. In order to increase their financial capability, the municipality has decided to use domestic bank loans for the counterpart funding. T w o third o f the counterpart funds will come f rom domestic bank loans and the rest f rom normal municipal capital investment funds. (The municipal government has provided the Bank with al l signed lending agreements and a repayment plan for the domestic Bank loans.) The municipal counterpart funds will come from four extra -budgetary sources: (i) land reservation surcharge, (ii) annual vehicle testing fees, (iii) transport construction surcharge (which will be collected f rom hotel guests), and (iv) parking fees. The task team has reviewed the details o f each source and determined that the sources and the projected future volumes o f funds are reasonable and that the funds will be collected. The task team has received the copies o f the government confirmation letters to these four revenue sources. Therefore, the counterpart funding requirements, including interest during construction and commitment fee and the interest for the domestic bank loan, are wel l within the generally accepted limits o f affordability for the municipality.

Counterpart funding arrangement. The project counterpart funds wil l absorb more than two

2.4 Public Transport Financial Review. T h i s review was undertaken to determine the financial sustainability o f the current system and financial issues to be monitored in connection with the institutional reform o f public transport. Although, the public transport companies have been running some losses, the government intention was to provide no subsidy to bus companies in 2003. The government proposes to address the issue o f operational losses during the reform o f this sector. This i s one o f the topics that will be discussed during the course o f the PT sector reform. Using data provided by the companies, a 5-year baseline financial projection shows (using reasonable assumptions on patronage growth, fare increases and staf f reductions), that the companies can achieve full cost recovery within the l i fe o f the project. This analysis has improved the understanding o f the financial situation for the public transport sector in Wuhan, and the need for further reform. Further details are provided in Annex 5.

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3. Technical: The Bank team conducted a thorough technical assessment o f the proposals for each component o f the project as summarized below by component:

3.1 Strategy and Policy Urban transport strategy

Development o f a network analysis tool, which integrated data f rom several existing databases (census, OD household survey, motor vehicle OD data, bicycle and taxi-use data, bus passenger data) and facilitated extensive analysis feeding into the urban transport strategy. Ongoing development o f an integrated urban transport strategy that reflects extensive analysis o f different infrastructure investments (such as road investments, investments in bus priori ty lanes and other passenger transport investments) in a comprehensive benefit-cost framework. Ongoing analysis to integrate the schemes funded under the Bank project with other investments made by WMG both during the project period (through 2007) and later. Introducing the concept o f continuous planning and the possibility o f (and benefits from) revisiting the 2020 Master Plan in light o f changed situations, priorities and actual demand. Further refinement o f the urban transport strategy, including coordination o f traffic management strategy with overall strategy, formulation o f parking policy, and formulation o f publ ic transport priority.

Maximizing the benej?ts to the poor An ongoing study o f the travel needs o f l o w income groups and the vulnerable in Wuhan will (i) determine potential impact o f the project o n vulnerable groups(the poor, women and recent migrants), and (ii) identify measures that would maximize net benefits for the vulnerable groups.

3.2 Road Network (i) (ii)

Development o f a functional road hierarchy. Selection, justification, design and timing o f new road construction schemes based o n project objectives and traffic demand. Analysis o f a l l suggested road schemes proposed for the Bank project using the WUTS planning process (see Annex 14). Integration o f land acquisition, resettlement and service diversions into costs and (iii)

implementation schedules.

3.3 Traffic Management (i) Physical junction channelization design. (ii) (iii) (iv)

(v)

Specification and design o f the Area Traffic Control System. Design and management o f facilities for pedestrians and cyclists. Requirements for appropriate parking standards, regulations and measures to implement parking policy. Justification, location and design o f public transport priori ty measures.

3.4 Public Transport (i) Ongoing analysis o f reform proposals for public transport including the separation o f

govemment functions (for strategic planning, pricing and subsidies, regulation and modal integration) f rom enterprise functions (for operations and business planning), restructuring

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o f current P T enterprises, introduction o f competitive tendering for service delivery and introduction o f more private sector o r jo int venture operators. Operational analysis o f bus operators, leading to proposals for development o f Comprehensive Five Year Plans focusing on route development programs, new bus requirements, depot and terminus requirements, passenger and revenue forecasts, capital and operating cost forecasts and assessments o f the overall financial position. Analysis o f proposals for interchanges, termini and busbays. Analysis o f the potential for bus priori ty measures and busways. '

(ii)

(iii) (iv)

4. Institutional:

4.1 Executing agencies:

Wuhan Municipal Government i s the executing agency for the project. Through most o f i t s preparation, the project was managed by the Wuhan Construction Commission o n behalf o f WMG. For the completion o f preparation and for implementation, the project will be managed, on behalf o f WMG, by the Wuhan Municipal Capital Investment Management Off ice (WMCIMO). The project office (WUTPO) will be retained. As i t s name implies, W M C I M O would be expected to focus on the investment aspects o f the project. Based o n experience with other projects, it will be particularly important to ensure that the project management arrangements facilitate the dialogue o n WUTS and UT policy between the Bank and Wuhan Planning Bureau and on P T reform between the Bank and WTC. These details were discussed at appraisal, are to be included in the PIP and monitored during the project implementation.

4.2 Project management:

WUTPO, which has successfully managed project preparation to date, needs to be expanded to ensure smooth implementation o f this large project more efficiently. The coordination ability o f WUTPO will also need to be strengthened. The same agencies, which successfully prepared the various components, will be managing their implementation. The implementation capabilities o f these implementing agencies will also need to be strengthened.

4.3 Procurement issues:

A procurement assessment has been carried out, which i s summarized in Annex 6. This assessment concluded that the procurement r isk i s average. The assessment found that although the proposed arrangements for managing the procurement function are appropriate, the procurement staff needed more training, especially those in the implementation agencies for the various components. Therefore, a training program was provided prior to the start o f project implementation to ensure that al l relevant staff are fully conversant with the Bank's guidelines and procedures. Further training can be provided as necessary during implementation.

4.4 Financial management issues:

A financial management assessment was carried out which is summarized in Annex 6. The project will produce project financial statements on a semi-annual basis, including Balance Sheet, Summary o f Sources and Uses o f Funds by Project Component, Statement o f Implementation o f Loan Agreement, and Statement o f Special Account. The project will use reports of the standard format agreed between the Bank and MOF. Retroactive financing in an aggregate amount not exceeding $15,000,000 wil l be provided to finance some c iv i l works, consultants and equipment undertaken after June 16, 2003. Audit arrangements will fol low the new Bank procedures.

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5. Environmental: 5.1 Summarize the steps undertaken for environmental assessment and EMP preparation (including consultation and disclosure) and the significant issues and their treatment emerging from this analysis.

The project complies with the requirements o f O.P.4.01. The project i s classified as EA Category ‘A’ since it involves involuntary resettlement, major road construction (partly on new alignments) and increased air pol lut ion and noise, particularly adjacent to new roads.

Environmental Category: A (Full Assessment)

A comprehensive environmental assessment has been carried out joint ly by Number Four Survey & Design Institute o f China Railways Ministry and Wuhan Research Academy o f Environmental Sciences in accordance with the policies and procedures of China and the Bank (see Annex 11).

The Bank reviewed and commented on the EA report and the E M P at various stages o f preparation. The revised reports meet the Bank’s requirements.

The projected increase in vehicles and motorized travel (with or without the project) will tend to increase local and global air pollution unless appropriate mitigation measures (not directly associated with the project) are introduced. Air pollution, noise, traffic management and safety, will be o f concern during both the construction and operational phases. Construction o f new roads in the project will also produce environmental impacts including dust, waste management and disposal, water pol lut ion and erosion during the construction phase, which will need to be mitigated. Road construction will also cause resettlement.

However, the proposed road network and traffic management components are also expected to have positive environmental impacts as they are designed to reduce traffic accidents, reduce personal time spent traveling, vehicle idling time and overall traffic congestion, though air pol lut ion may increase in some localized areas. The public transport component will also have a positive effect o n the environment by slowing the growth o f motorized private vehicle use. Environmental institutions will be strengthened through environmental monitoring equipment upgrading, staff training, and formulation o f a vehicle emission control strategy.

5.2 What are the main features of the E M P and are they adequate?

A s part o f the EA process, a separate E M P has been prepared. The E M P includes: mit igation measures, an environmental monitoring plan, environmental monitoring supervision plan, institutional arrangements, a training plan and estimated costs for a l l environment related activities. It provides for the inclusion o f environmental protection in the design, construction and operational phases.

Design phase. Mitigation measures included in the project design include additional facilities for noise barriers, double-glazing and air conditioners to mitigate noise impacts at sensitive sites, and planting along the proposed project roads. Project designs have been reviewed to ensure the careful positioning o f facilities with appropriate landscaping and buffer zones to control noise and to mitigate the impact o f increased vehicle emissions adjacent to the new roads and to reduce severance.

Construction phase. During construction, measures will be introduced to limit noise, dust and other impacts o f construction. Full t ime environmental management staff will be assigned at each construction site. Training wil l be provided to them. If construction at night i s unavoidable, then the contractors will be required to give advance notice to a l l affected residents, and to undertake additional monitoring and mitigation measures.

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Operational phase. The project also includes a component for the setting up automatic monitoring sub-stations for air quality and noise and development o f a vehicle emission control program.

5.3 For Category A and B projects, timeline and status o f EA: Date o f receipt o f final draft: June 2003 (Draft dated M a y 2003)

The Bank has received and reviewed several drafts o f the EA, EA Summary and E M P reports. The State Environmental Protection Administration (SEPA) reviewed and cleared the final draft EA (dated M a y 2003) in late July 2003. The final draft E M P was updated and received in August 2003. The final draft EA Summary (dated September 2003) was received o n October 15,2003. Copies o f drafts o f a l l documents have been successively disclosed in Wuhan in Chinese and in English in the Bank's Public Information Center in Washington, starting with the first draft EA in February 2003. The English versions o f the documents have been disclosed in Bank's Bei j ing Off ice since June 12,2003.

5.4 H o w have stakeholders been consulted at the stage o f (a) environniental screening and (b) draft EA report on the environmental impacts and proposed environment management plan'? Describe mechanisms o f consultation that were used and which groups were consulted?

K e y stakeholders include the Wuhan Construction Commission, Wuhan Environmental Protection Bureau, local communities and governments, project affected peopleh-esidents along the proposed new roads, bus passengers, and local NGOs. The public consultation o n the EA has involved these groups.

Public and stakeholder consultations were carried out in three stages:

Thefirst stage consultation was conducted between September 4th and 7 th , 2002 when the TOR for the EA was prepared. There was a notice on September 5th, 2002 in two local newspapers (the Wuhan Evening News and the Changjiang Daily) detailing the locations and agendas for the public meetings related to this consultation. Participants were representatives o f project affected people who l ive in the areas around the proposed project roads. A summary o f the project and key EA information was announced o n September 9th on Wuhan communications radio. The second stage consultation was carried out between December 26th and 29th 2002, in different locations through means o f meetings and interviews with project-affected people and interested groups, when the first EA report was compiled. The public was noti f ied o f the location and agenda for this second round o f consultations by way o f announcements o n December 28th o n Wuhan's TV stations and in the December 29th edition o f the Wuhan Evening News. The third stage consultation was conducted from March 26th to April 10th ,2003, at the review stage o f the draft EA report. As with the other two stages, consultation was carried out in different locations and a variety o f techniques have been used including site visits, public surveys and interviews with project-affected persons and groups. During the consultations, the consulted groups were advised o f the EA revisions and were given feedback o n the solutions to their concerns. The public was notified o f the third round o f consultations through an announcement in the Feb 19,2003 edition o f the Wuhan Evening News.

In al l stages, local communities were consulted through (i) (ii)

(iii)

meetings with representatives o f project-affected people f rom areas o f project roads; meetings with neighborhood committee, representatives o f local district government and deputies o f the local People's Congress; and public opinion questionnaires supplemented by interviews. In all, over 3,500 people participated in the consultation process.

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The f irst draft o f the EA report and the E M P were placed in the Wuhan public library, the offices o f the Wuhan Academy o f Environmental Sciences and the offices o f the Fourth Railway Design Institute o n February 18th 2003. Subsequent drafts o f these documents were placed at the same locations. Drafts o f the EA and E M P documents were init ial ly disclosed in the Bank's Infoshop in Washington o n February 18th 2003.

5.5 What mechanisms have been established to monitor and evaluate the impact o f the project on the environment? D o the indicators reflect the objectives and results o f the EMP'?

A contract will be signed with a qualified firm or institute to monitor the environmental impacts o f the project both during construction and after the project i s operational. Appropriate monitoring indicators have been chosen to measure air quality and noise impacts during construction and operation.

6. Social: 6.1 Summarize key social issues relevant to the project objectives, and specify the project's social development outcomes.

Improvements to transport services for low-income residents are implici t in the project development objectives. This will be achieved mainly through the improvements to pedestrian facilities (footways, pedestrian crossings etc), creation of NMV routes and bus service improvements. The road safety program aims to reduce accidents and casualties, which tend to involve poorer residents. A s stated earlier, the Bank team has also conducted a survey o f the travel needs o f vulnerable people in Wuhan to help refine elements o f the project investments such that the benefit for the poor i s maximized.

OP. 4.12 on Involuntary Resettlement applies to this project. The project complies with the requirements o f OP 4.12. The road network and public transport components o f the project are expected to require land acquisition. The road network schemes in the project were chosen after comparing several alternatives with a v iew to minimizing resettlement and adverse impacts. The Project Office undertook baseline social analyses and resettlement planning studies to show h o w incomes and living standards will be improved, or at least restored, for al l persons adversely affected by the project. A Resettlement Act ion Plan (RAP) has been prepared by the borrower. Final designs for schemes to be undertaken in the public transport component will not be available until the project i s under implementation. Civil works associated with the public transport component are scheduled to occur in the third year o f implementation. Because it i s impossible to prepare a fully-specified R A P for this component prior to appraisal, the Project Off ice will prepare a separate resettlement implementation plan consistent with R A P principles and standards for Bank review and acceptance prior to the third year o f implementation. Annex 12 reviews adverse impacts related to land acquisition or changes in land use for the project, and summarizes the measures included in the R A P for mitigating them. Related public consultation and disclosure activities are also summarized in the same Annex. The road network component involves works scattered throughout the city, with 62 urban residential community committees and 48 suburban villages affected in varying degrees by land acquisition and structural demolition. In all, 176 hectares o f collective-owned land will be acquired in village areas. Housing demolition will require relocation o f 1 164 urban households and 1064 suburban households. Other significant impacts include relocation o f shops, enterprises and public institutions. Of the collective land to be acquired, about 124 hectares i s cultivated with the remainder used for house plots o r other purposes. Most suburban villagers, however, derive relatively little or no income from agricultural production. Land compensation wil l be based o n the highest average annual output value per mu among the same land in the affected municipal districts. In each case, compensation rates meet or exceed legal requirements and meet or exceed replacement cost valuation. Villagers themselves decide o n appropriate rehabilitation measures for collective members, which typically includes redistribution o f remaining land

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and collective investment o f land compensation. In some cases, those affected opt to receive a cash resettlement subsidy and relinquish collective membership in favor o f urban residency.

Compensation rates for demolished structures are based on replacement cost for the structure itself and a supplemental zonal valuation. Compensation rates for illegal structures are based o n replacement cost for the structure, but do not include the supplemental zone valuation.

The RAP includes several features that go wel l beyond minimum resettlement requirements. Among them: special arrangements for poor and vulnerable households to obtain subsidized rental apartments or to obtain discounts and subsidies on purchase o f replacement housing, and a scheme to provide households losing very small residential un i ts with additional compensation so they may purchase replacement housing meeting community minimum size standards.

Based on preliminary estimates, the public transport component i s l ikely to include acquisition o f about nine hectares o f collective-owned land and to require relocation o f about twenty households, scattered among four suburban villages. The Bank pol icy relative to indigenous people (OD 4.20) does not apply and an IPDP i s not required. The social assessment and socio-economic survey found that there are no ethnic minority communities in the project area.

6.2 Participatory Approach: H o w are key stakeholders participating in the project?

All affected households and villages were identified through a socio-economic census. Additional details regarding sources of income and local living standards were obtained through a baseline survey and through the social assessment process. Project information was provided to the affected households and villages, and municipal district governments through newspaper, posters and public meetings. The draft version o f the RAP was advertised on Feb. 17,2003 in the Wuhan Daily, and placed in the Hubei Provincial Library and the Wuhan Municipal Library. Subsequent drafts o f the RAP were placed at the same locations

An extensive public consultation process, including focus group discussions and key informant interviews, was designed as part o f a two-stage consultation strategy (concurrently with public consultations related to the environmental assessment) to disseminate project information, collect people's concerns, needs and recommendations, and consult the affected people about the resettlement and rehabilitation strategy. Particular attention was devoted to the low-income residents and vulnerable group o f people during the consultation process to ensure that the information dissemination methods were appropriate and adequate. Information dissemination and consultations are designed to continue during the project implementation.

A resettlement information booklet, including detailed entitlements o f each household, compensation and entitlement policies and grievance procedures will be prepared and distributed to the displaced people prior to the resettlement implementation. Displaced communities will play a key role in finalizing and implementing their livelihood restoration programs.

6.3 H o w does the project involve consultations or collaboration with NGOs or other c iv i l society organizations'?

The Population Research Institute o f Wuhan University was contracted to head the social assessment exercise. This has contributed significantly to the preparation o f the RAP. Residential committees and village committees have also been consulted with and participated in the resettlement planning process and the preparation o f the project.

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6.4 What institutional arrangements have been provided to ensure the project achieves i ts social development outcomes'?

The institutional arrangements for resettlement implementation are detailed in the RAP. The Population Research Institute o f Wuhan University, independent from the provincial and municipal government and the project management office, will be contracted to serve as the independent monitoring agency o f the resettlement program. The project will be monitored and the living standards o f the PAPS will be evaluated over the course o f the project implementation. The monitoring results will be regularly reported and, if needed, remedial actions will be designed,

6.5 How wil l the project monitor performance in terms o f social development outcomes?

Both internal and independent external monitoring o f the resettlement program will be conducted regularly during project implementation. The Population Research Institute in Wuhan University wi l l carry out independent monitoring every six months. Apart from physical progress, this review wil l evaluate livelihood restoration efforts and their effectiveness. The RAP describes in detail the purpose o f monitoring, responsibilities, indicators, methodology, procedures and reporting requirements.

7. Safeguard Policies:

7.2 Describe provisions made by the project to ensure compliance with applicable safeguard policies.

Sections E5 & E 6 describe provisions made to ensure compliance with OP 4.01 and OP 4.12. The draft EA and RAP were f irst disclosed in the Infoshop in Washington on February 18,2003.

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F. Sustainability and Risks 1. Sustainability:

Sustainability has environmental, social, financial and economic dimensions. Socially sustainable development o f the transport system in Wuhan requires a pol icy and institutional framework for effective handling o f resettlement. The project aims to leave behind the institutional capacity, and an efficient delivery mechanism to address the adverse social impacts associated with urban infrastructure projects. I t also requires that policies be designed to benefit a l l transport users, particularly the socially disadvantaged and not just those with access to motor vehicles. The surveys o f the disadvantaged groups undertaken during project preparation are being used in the design and refinement o f service delivery. The project places emphasis o n providing for the continuation o f these surveys as a means o f determining the needs o f the disadvantaged. The environmental sustainability o f the project i s dependent on the extent to which the overall level o f local and global emissions due to increasing travel demand i s monitored, contained or reduced. A Motor Vehicle Emission Control Strategy i s designed to do this.

S

The sustainability o f the physical assets i s feasible. However, adequate resources for operating the system, for maintenance and replacement o f assets, and for increasing capacity in response to user demands remain the most important consideration. For the bus system, reform measures discussed to date are designed to reduce costs, eliminate subsidies and introduce competition. If successful, they will ensure the long-term sustainability o f the system. If during the project these reform measures are found to be inadequate, other regulatory and competition possibilities will be suggested. For the maintenance o f roads and traffic management, measures are required to improve management o f existing funds, ensuring provisioning in the budgets and possibly increases in user charges. These aspects will be reviewed in the continuing work o n the transport strategy.

This is a real risk given the greater emphasis in China on construction. Further development o f W U T S throughout the project to mainstream road maintenance and traffic management policies, programs and budgets, coupled with an annual review o f maintenance budgets should help change this emphasis.

The institutions responsible for construction o f roads, and traffic management are already experienced and fully effective. The staff o f the agencies responsible for planning and programming o f transport investments, and bus service delivery are capable but need more hands-on experience, while the institutions themselves in which they work require strengthening. These aspects will be addressed during the implementation o f the project.

There i s a risk that some o f the pol icy prescriptions underpinning sustainability will not be fol lowed in the medium to long term. The risks are being mitigated by very close cooperation and extensive discussions between the Bank and the Municipal i ty during preparation. This cooperation i s coupled with the extensive use o f local staff and consultants, with a thorough knowledge o f Chinese conditions, working in partnership and adapting pol icy solutions that have been we l l tested around the wor ld for the Chinese environment.

2. Critical Risks (reflecting the failure o f critical assumptions found in the fourth column o f Annex 1):

Risk I Risk Rating I Risk Mitigation Measure From Outputs to Objective The Municipality does not continue to maintain or manage the new road space to make most efficient use o f it

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nitial adverse public reaction to the mplementation o f traffic management TM) measures.

'he traffic police do not enforce traffic nanagement measures.

3us operators take n o steps to address ither operational inefficiencies such as lunching at bus-stops, to maximize the iotential o f bus lanes.

NMG fails to give adequate pol icy upport to bus priority.

:he bus operators do not take advantage if IT to reduce staff, retrain staff improve nanagement, and operational n-oductivity

lata generated by expanded :nvironmental monitoring system i s not ised by municipal leaders to make more nformed decisions on mitigation measures

?rained staff do not stay in respective n i t s for at least the l i fe o f the project

Zonsultant services do not transfer nowledge and technology, and facilitate he adoption o f intemational best practice

M

M

M

M

M

M

S

M

Wunicipality and the traffic police are aware o f :he importance o f public consultation and have a zood record, which i s expected to continue, :specially with continued Bank support and idvice during project implementation.

The measures are designed to the extent possible :o be self enforcing, and the police are :ommitted to them. Continued Bank support md advice should sustain that commitment.

rhere are a number o f measures in the project to w i s t operators address these issues (including CMIS, reconstruction o f stops and TA from local and international experts). There i s also pressure f rom the Municipal i ty to reduce costs and improve services.

Further development o f WUTS throughout the project to reinforce the need for such policies, coupled with study tours to help WMG decision makers understand h o w the policies can be implemented, and TA support for the careful preparation o f good quality schemes.

Staff reduction has been l imited to date in bus operators in China. Bank agreement to procurement o f the Stage 1 IT equipment wil l be l inked to a time based action plan for training and efficiency measures, and for Stage 2 equipment to progress in implementing the action plan. TA support i s also provided for the formulation o f business plans. The Municipal i ty wishes to reduce subsidy, which puts pressure o n operators to reduce costs.

Bank agreement to investments in M V E C S to be l inked to use o f this data and regular reporting.

Use o f appropriate criteria in the selection o f appropriate staff for training.

Discussion with implementing agencies to agree o n the technical areas where such transfer i s most useful, coupled with rigorous application

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From Components to Outputs Prior to commencing civ i l works, required land acquisition, resettlement and service diversions are not planned, budgeted and implemented causing project delays.

Additional schemes are not selected by WMG using WUTS

WPSB leadership and cooperation between the various stakeholders o f the project o n TM does not continue

The municipality does not implement the emission control strategy

Cooperation between the various stakeholders o f the project o n the MVECS does not continue and leadership by WEPB abates

Project Off ice has inadequate staff, skills and authority to manage the overall project

Overall Risk Rating

Risk Rating - H (High Risk), S (Substantial Ri: M

3. Possible Controversial Aspects:

None identified

G. Main Loan Conditions 1. Effectiveness Condition

Standard conditions o f effectiveness

S

S

M

S

M

M , M (Modest Risk), F

)f consultant selection and monitoring o f :onsultant performance

ipproval o f c iv i l works contracts only given vhen these activities are completed

zreation o f a formal coordination group headed )y senior WMG leaders.

b u a l review o f the project and linkage o f nvestments in the environment component to rogress in MVECS. The Government o f China s putting great emphasis o n improving air iuality in cities.

:reation o f a formal coordination group headed iy senior WMG leader

4greements to be reached at negotiations. Loan :ovenant. Monitoring and remedial action by 3ank supervision missions

Negligible or Low Risk)

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2. Other [classify according to covenant types used in the Legal Agreements.]

2.1

2.1.1

2.1.2

2.2

2.2.1

2.2.2

2.2.3

2.3

2.3.1

2.3.2

AccountsIAudit

Wuhan shall have the records, accounts and financial statements for each fiscal year audited, in accordance with consistently applied auditing standards acceptable to the Bank, by independent auditors acceptable to the Bank. Wuhan shall hmish to the Bank not later than six months after the end o f each such year (A) certified copies o f the audited financial statements and (B) an opinion on such statements by said auditors, in scope and detail satisfactory to the Bank.

Monitoring, Review, and Reporting

Wuhan shall prepare reports each calendar semester, on the physical progress o f implementation and the status o f procurement and hmish them to the Bank within 30 days o f the end o f each semester, starting July 3 1, 2004.

Wuhan shall prepare annual reports by February 15 each year, starting on February 15,2005 on the progress achieved in the preceding year and the proposals for the next year.

The mid term review for the Project shall be not later than May 3 1, 2006.

Implementation.

Overall (i) Wuhan shall maintain until completion o f the Project the Municipal Project Leading

Group, with terms o f reference acceptable to the Bank, and responsible for the coordination among all municipal entities in regard to the implementation o f the Project. Wuhan shall maintain throughout the l i fe o f the project, a Project Office with units responsible for land acquisition and resettlement, environmental management, procurement, financial management, construction management, project management and monitoring and reporting, to be adequately resourced with suitably qualified staff. Wuhan shall, not later than November 30 in each year, commencing November 30,2004, and until completion o f the Project, prepare and hmish to the Bank for comments, a proposed annual work program and budget for the Project for the next Fiscal Year, and thereafter implement such work program as shall have been agreed with the Bank. The Construction Supervision team employed to assist in the supervision o f the civil works construction shall remain in place during the entire implementation period.

(ii)

(iii)

(iv)

Road Network Development Component (i) Wuhan shall not make any changes to the agreed program except if such change i s

compatible with the Wuhan Urban Transport Strategy and a full feasibility study, acceptable t o the Bank, i s carried out. Wuhan shall carry out the EMPs, RAPS and the RPF, in a manner satisfactory to the Bank, in particular: (a)

(ii)

Prior to commencing any work not included in the RAP, prepare a RAP in accordance with the RPF.

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(b) Prior to commencing any work not included in the EMP, prepare an E M P satisfactory to the Bank.

2.3.3 Road Maintenance Component Wuhan shall (i) (ii)

(iii)

implement the road maintenance management system by December 3 1,2006. review with the Bank the progress on the reform o f the road maintenance functions, by March 3 1 in each year, commencing March 3 1,2005, and until completion o f the Project. review with the Bank the maintenance performance and expenditures against the budget for the previous year and the previsions for the forthcoming year, by March 3 1 in each year, commencing March 3 1,2005, and until the completion o f the Project.

2.3.4 Public Transport Component (i)

(ii)

Wuhan shall review with the Bank the progress o f the Wuhan public transport reform by March 3 1 in each year, commencing March 3 1,2005, and until completion o f the Project. P T companies to fumish through the Wuhan Public Transport General Company, for review a rol l ing five-year development plan by March 3 1 in each year, commencing March 3 1,2005, and until completion o f the Project, and then to implement such plan.

2.3.5 Technical Assistance Component Wuhan shall

review with the Bank at least once a year, and until completion o f the Project, any developments in the Wuhan Urban Transport Strategy. carry out the training in accordance with a training program acceptable to the Bank; and review the training program with the Bank by March 3 1 in each year, commencing March 3 1,2005, and until completion o f the Project. carry out the studies agreed with the Bank in accordance with terms o f reference and a timetable acceptable to the Bank, fumish to the Bank the recommendations o f each o f the studies promptly upon completion o f the relevant study, prepare an action plan for each o f the studies to implement the recommendations, taking into account the comments o f the Bank, if any; and thereafter promptly implement such action plan. review with the Bank by March 3 1 in each year, commencing March 3 1,2006, and until completion o f the Project, the progress in the implementation o f the recommendations o f the motor vehicle emission control strategy study.

H. Readiness for Implementation 1. a) The engineering design documents for the first year's activities are complete and ready for the start

o f project implementation. 0 1. b) N o t applicable.

IxI 2. The procurement documents for the f i rst year's activities are complete and ready for the start o f

IxI 3. The Project Implementation Plan has been appraised and found to be realistic and o f satisfactory

0 4. The fol lowing items are lacking and are discussed under loan conditions (Section G):

project implementation.

quality.

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I. Compliance with Bank Policies 1. Th is project complies with al l applicable Bank policies.

0 2. The fol lowing exceptions to Bank policies are recommended for approval. The project complies with al l other applicable Bank policies.

Sector Dlrector Edward Dotson Team Leader

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To support China's transition from (i) a rural, agricultural society to an urban, industrial society, and (ii) a centrally planned economy to a more globally integrated market-based economy

Project Development Objective: To promote development o f an integrated, efficient, and sustainable transport system for the rapid, safe and convenient movement o f people and goods in Wuhan

1. Support Investments in transport infrastructure and services that address current system efficiency, capacity, safety and sustainability issues, and address the mobility needs of users.

Annex 1 : Project Design Summary CHINA: Wuhan Urban Transport Project

Sector Indicators: Measures o f Municipal Urban Transport Services

Outcome I Impact Indicators:

1. Capacity and efficiency 1.1 Reduction o f travel time for motorized vehicle users on the key external/cross town route from Automobile Town to Jianghan Road from 49 minutes in 2002 (baseline) to 43 minutes in 2008.

1.2 Reduction o f travel time for motorized vehicle users on the key cross river route from Hankou Railway Station to Hongshan Square from 37 minutes in 2002 (baseline) to 32 minutes in 2008.

1.3 Reduction o f travel time For motorized vehicle users on :he key central area route From Houhu to Wuhan Plaza From 26 minutes in 2002 'baseline) to 22 minutes in -008

Sector/ country reports: 3overnment and municipality .eports

'roject reports:

4nnual progress reports Mid-term review [mplementation Completion Report 4nnual municipal and State -eports 4ccident Analysis Study Reports

from Goal to Bank Mission) in urbanized industrialized iarket-oriented economy w i l l pur more economic growth. h e benefits o f growth will :ach the poor both directly in terms o f more pportunities that improve i e i r quality o f l i fe) and idirectly (in terms o f more :sources to provide a social afety net).

from Objective to Goal)

.1 There are no significant hanges in forecast rates o f nigration or motorization.

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1.4 Improvement in bus service productivity, with an increase in average daily ridership from 259 mi l l ion in 2002 (baseline) to 3 10 mi l l ion at end o f project (2008)

2. Mobility 2.1 Reduction o f travel times for pedestrians on key routes (i) Hong Kong Road to Xan Li Men from 68 minutes in 2002 (baseline) to 59 minutes in 2008: (ii) Wulidun to Zhongdian Dun from 30 minutes in 2002 (baseline) to 26 minutes in 2008

2.2 Reduction o f travel times on for cyclists on key NMT routes: (i) Tiangjiadun to Riverside at Sanyang Road from 30 minutes in 2002 (baseline) to 22 minutes in 2008: (ii) Yunlin Street to Macao Road from 20 minutes in 2002 (baseline) to 15 minutes in 2008 (iii) Riverside at Sanyang Road to Wuhan Guan from 20 minutes in 2002 (baseline) to 18 minutes in 2008.

2.3 Reduction o f travel times for bus users on key routes (i) Cross river from Hankou Railway Station to Hongshan Square from 48 minutes in 2002 (baseline) to 42 minutes in 2008. (ii) In central area from Houhu to Wuhan Plaza from 34 minutes in 2002 (baseline) to 29 minutes in 2008

3. Sustainability 3.1 Production and implementation o f Annual road maintenance plans, based on application o f RMMS, by 2008.

i. 1 The Municipality bases naintenance budgets on ieeds identified by R M M S

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!. Support formulation o f a ransport strategy to guide nvestment decisions

Output Indicators:

All c iv i l works contracts delivered at acceptable quality within time, budget, cost and safety constraints.

L. Support for reforms to mprove performance o f bus iervice delivery.

Project reports:

All components 1. Before and after performance indicator surveys as work proceeds. 2. Annual progress reports 3. Mid-term review; Implementation Completion Report

Iutput from each 2omponent: \. Road Network. :arty-seven road schemes to a) provide alternatives for :xtemal or cross-town traffic b) relieve cross river :ongestion c) relieve congestion in :entral down-town areas d) provide for orderly :xpansion o f new growth ireas md e) 17 footbridges and iubways to provide safer :onditions for pedestrians and VMV

TM. Traffic Management

TM1. Pedestrian program i) Sixty-three mid-block iignalized pedestrian xossings ii) Pedestrian phases in raffic signals at 99 junctions. iii) One pedestrian street

3.2 Formulation and adoption o f an effective motor vehicle emissions control strategy to reduce pollution due to motor vehicles, including a new I/M system by 2008.

2.1 Further detailed studies recommended in the WUTS Report to be completed by mid term review in 2005. 2.2 Transport Policy “White Paper” to be prepared by 2008. 2.3 Investment program for f ive year period starting in 2008 finalized by 2008.

Bus route tendering on a competitive basis completed across the bus system by 2008,

TM1 (i) Mid-block signals installed and functioning (ii) Cycle times at a l l signals at the 99 junctions revised such that pedestrian phases installed and functioning (iii) Street pedestrianized

3.2 The Municipality :ontinues to regard reduction If emissions as a priority.

The Municipality continues to use the transport strategy as a basis for decision making on transport policies and investments.

The Municipality continues to support reform o f the public transport system.

(from Outputs to Objective)

The Municipality continues to maintain and manage the new road space to make most efficient use o f it.

;he Municipality continues to implement measures in face o any init ial adverse public reaction.

The traffic police enforce the measures, particularly in the period after ini t ial

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TM2. NMV program 50 km o f NMV routes with :ither MVINMV segregation 3r MV restrictions

TM3. Bus priority measures [i) 35km o f bus lanes on nine routes

TM4. Junction channelization and traffic facilities program (i) 274 junction channelizations -46 physical; -228 with traffic facilities

TM5. Area Traffic Control (ATC) and traffic signal upgrading program (i) A T C systems installed in Hanyang, East Lake Hi-Tech zone, WuchanglQingshan (ii) Traffic signals installed and upgraded (iii) Thirty-five C C T V real-time monitoring cameras

accident analysis program (i) Enhancement o f traffic management information system (ii) Accident blackspot improvements: engineering and traffic facilities at sixteen blackspots and on thirty-two arterials

TM2 V M V routes created with Jartial or full segregation on 111 60km o f roadway

I'M3 Priority measures implemented and functioning 3n designated 35 km network

TM4 (i) All c iv i l works contracts delivered at acceptable quality within time, budget, cost and safety constraints. (ii) No widening o f junctions

TM5. (i) A T C systems and traffic signals installed and functional (ii) Signals in communication with central A T C and signal t iming plans integrated with existing signals (iii) C C T V installed and functioning in appropriate sites. (iv) V M S installed and functional. Systems installed to provide V M S with appropriate updated information.

TM6 (ii) All civi l works contracts executed on time, within budget and at acceptable quality (iii) Accident investigation equipment procured (iv) Systems established to inform and collect f ines from

implementation.

TM3 Bus Operators take steps to prevent operational issues such as bunching at bus stops which reduce effectiveness o f bus lanes.

WMG Policy continues to give priority in the allocation o f road space to buses.

I

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:iii) Traffic accident investigation equipment :iv) Thirty red-light violation :ameras

rM7. Road user education [RUE) program [i) Children's traffic Safety Playground; nine associated district education bases [i i) Public education billboards (i i i) RUE Columns in local newspapers (iv) RUE Helpline and website (v) Traffic TV program (vi) Traffic radio program (vii) Traffic safety pamphlets (viii) TM Information Map

TM8. Road marking equipment Four motorized and seven hand-pulled vehicles. Selected TDM measures implemented after the TDM Study

PT. Public Transport:

PT1. Information Management System Computerizing basic tasks currently done manually.

PT2, PT3, PT4. Investments in physical infrastructure (i) Four long-distance and seven city centre interchanges. (ii) Reconstruction o f twelve termini (iii) Fourteen bus-bays

.ed-light offenders in legally qalid and acceptable manner.

rM7. :i) All c iv i l works contracts ielivered at acceptable quality within time, budget, cost and safety constraints. :ii) All publications and 3erformances designed, zxecuted and disseminated on schedule and in budget

TM8. All equipment procured competitively: installed and functional

PT1. Computer systems procured competitively, installed and functional. Staff trained to use computer systems.

PT2, PT3, PT4 All c iv i l works contracts delivered at acceptable quality within time, budget, cost and safety constraints.

'Tl. :he bus operators take .dvantage o f I T to reduce taff, retrain staff retained, nanage more effectively and ncrease productivity

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RM. Road Maintenance:

RM1. Reconstruction o f ten existing roads

RM2. Road maintenance equipment

RM3. Road maintenance management information system

EN. Environment.

EN1. Vehicle emission and traffic noise monitoring systems (i) air quality monitoring systems increased from five to fifteen; (ii) two vehicle emission monitoring sub-stations, automatic computerization; monitoring equipment (i i i) 7 noise monitoring sub-stations; and (iv) I T equipment

EN2. Motor vehicle emission control strategy (MVECS)

EN3. Noise mitigation

EN4. Environmental eng design and management

E N 5 Environmental monitoring

RM1. All c iv i l works contracts delivered at acceptable quality within time, budget, cost and safety constraints.

RM2. All equipment procured competitively, installed and functional. Staff trained to use.

RM3. All computer systems procured competitively: installed and functional. Staff trained to use. Data on road conditions collected and entered into system.

EN1. All computer systems and equipment procured competitively: installed and functional. Staff trained to use.

EN2. Motor vehicle emission control strategy (MVECS) developed and adopted for implementation.

EN3. Noise mitigation measures implemented

EN4. EMP implemented. Construction supervision and designs judged environmentally sustainable

2N1. la ta generated i s used by nunicipal leaders to make nore informed decisions on nitigation measures.

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rA . Capacity building

TA1, TA2 Trained staff stay in respective units for at least the l i f e o f the project.

TAl, TA2. International and domestic training

TA3 Consultant services transfer knowledge and technology, and facilitate the adoption o f intemational best practice

rA3. Consultant services. 3.1 C iv i l works supervision 3.2 High strength bituminous 2oncrete pavement study 3.3 Road safety audit 3.4 Support for public transport reform 3.5 Other public transport related studies 3.6 Traffic management related studies 3.7 Studies related to environmental management 3.8 Road bridge and drainage management system 3.9 Wuhan Urban Transport Strategy (WUTS) 3.10 Financial management system analysis 3.1 1 Travel needs o f the l o w income and vulnerable groups

TA4. Office equipment

TA1, T A 2. Study tours planned and executed on schedule and in-budget

TA3. All studies tendered competitively and complete on time and within budget, accomplishing scope o f work

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Droject Components I Sub-components: iN. Road Network

TM. Traffic Management

IT. Public Transport

iM. Road Maintenance

3N. Environmental aanagement

TA. Capacity Building and rechnical Assistance

nputs: (budget for each :omponent) 161.3

13.4

14.2

17.5

i.5

'.9

'roject reports:

?or all components: Legular project management eports, including: i) quarterly and annual lrogress reports ii) audit report iii) mid t e r m review reports iv) study reports v) Bank supervision mission eports

[from Components to Outputs) Required land acquisition, resettlement and service diversions are planned, budgeted and implemented.

Additional schemes, if any, x e selected using WUTS

Continued effective cooperation between the various stakeholders o f the project and continued program leadership by WPSB.

The municipality provides continued support for improvements to public transport.

The municipality continues with announced reform o f road maintenance management and operations.

The municipality implements the emission control strategy, once the study i s completed. Continued effective cooperation between the various stakeholders o f the project and continued leadership by WEPB.

Continued WMG ownership

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ill components 579.8 Project Office has adequate staff, ski l ls and authority to manage the overall project effectively. Project Office produces good quality timely reports. Project design i s adjusted in response to changing circumstances as required to meet the project objective.

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Annex 2: Detailed Project Description CHINA: Wuhan Urban Transport Project

(a) Provide suitable routes for through or cross-town traf$c

(c) Relieve congestion in central down-town areas (d) Provide adequate road networks in development areas (e) Provide safe conditions for pedestrians

(b) Improve utilization of existing cross-river bridges

The implementation of this project includes components for road network development, public transport, traffic management, road maintenance, environment protection and technical assistance. The costs for land acquisition and resettlement and recurrent costs such as preparation, design and administration are indicated in each component.

Primary Secondary Objective Objective

14 3 3 6 8 2

10 3 17 1

By Component:

Project Component 1 - US$461.30 million Road Network Development The key problems and deficiencies in the existing road network within Wuhan were identified in the Wuhan Urban Transport Strategy (WUTS). These may be summarized as:

0

0

lack o f suitable routes for external or cross-town traffic

crossings insufficient capacity for cross-river traffic and poor distribution o f traffic between existing

congestion in the central areas o f the three towns, especially Hankou inadequate road networks for the orderly expansion o f the city into new growth areas poor conditions for pedestrians with resultant safety concerns.

0

0

0

This component addresses the two immediate needs o f improving the operation o f the road network within the city, and expanding the bicycle and pedestrian networks. The proposed road network investment strategy i s also derived from the WUTS. It i s the result o f extensive testing o f altemative road and public transport networks, and altemative investment options to address the key problems noted above. A total of forty-seven schemes, covered in five programs, are proposed for implementation over a five-year period. The primary objective and number o f projects in each program is shown in the table below. Many projects serve a secondary objective as well. Where appropriate these secondary objectives have been identified.

I Total I 52 I l5 I The civ i l works for these five programs include the construction o f new roads, upgradinglwidening o f existing roads, construction of interchanges and construction o f pedestrian overbridges or underpasses. The works are spread across the primary road network (middle and inner ring roads, and selected radial roads), the arterial road network and local roads.

- 4 1 -

RN1 Provide suitable routes for external or cross-town traffic

A number o f schemes are situated o n the primary road network, including the construction o f 18.6 km o f the Middle Ring Road (North), 7.2 km o f the Middle Ring Road (South), and seven associated interchanges. Sections o f two radial roads will also be upgraded and one new radial road (1 3km) will be constructed. Three key junctions o n radial routes will be improved. Additionally, sections o f seven urban arterial and local roads will be constructed or upgraded.

Middle Ring Road (MRR) & Interchanges: Three sections o f the MRR are proposed for inclusion in the Bank project: a 15 km section in the north (including four interchanges) will be constructed between 2003 and 2005 and the remaining section in the north (3.6km), plus a 7.2 km section in the south, (including three interchanges) are scheduled for 2006-2007.

RDl. I Middle Ring Road (North) (Etouwan-Sanjintan) 15.0km: This component i s designed to provide rel ief to the central areas o f Hankou and to provide a through route for traffic wishing to by-pass the urban area in an east-west direction. The road wil l be constructed as an urban expressway (dual 3-lanes) and wil l be located adjacent to an existing flood protection bund, fol lowing a natural break in the urban development. The road wil l connect in the west with the existing westem section o f the MRR and National Highway 107, and in the east with the D a i Huang Highway (Huangpu Lu). Grade-separated interchanges will be provided at the crossing points with the existing four radial routes to the north. Traff ic volumes in excess o f 80,000 vpd are forecast in 2007, increasing to above 100,000 vpd by 2020.

RD1.2 Middle Ring Road (North) (Sanjintan-Hun Shi) 3.6km: This section connects f rom the Sanjintan Interchange (above) to the existing Han Shi Highway on a temporary (Le. non-Master Plan) alignment. The final alignment connects directly to the approach to the proposed Yangtse No. 4 Road-and-Rail Bridge.

RD1.3 Middle Ring Road (South) (Qingling-Luoshi Nan Lu) 7.2km: This section o f the MRR would complete the southem section o f the route and provide a connection (via an 8km section o f route presently under construction and funded by WMG) between the existing expressway eastwards to Huang Shi (70km) and the completed Yangtse No. 3 Bridge and the westem section of the MRR. The component could thus provide a by-pass for traffic f rom the east (which would otherwise pass through the center o f Wuchang and use the No. 1 Bridge) and enhance the usage o f the Yangtse No. 3 Bridge. I t i s also claimed that this section o f road would assist in the development o f the adjacent areas, proposed for both hi-tech industrial and education uses. However, the traffic projected o n this section o f the road was l o w and the degree to which this project substantively contributes to the overall objectives o f the Bank project, i s not clear. I t was agreed that though the project would be included in the road network component, it would not be included for funding unless a substantially stronger case for i t s construction were made.

Radial Roads & Key Junctions:.

RD1.4 Qinghua Lu (Phase I, 4.48km; Phase 11, 8.52km): This i s a new radial route providing access to a proposed new development area in the east o f the city, on land adjacent to the Wugang I ron & Steel Works. I t will additionally provide a new route for extemal and truck traffic f rom the industrial area avoiding the '

center o f Qingshan. The alignment proposed init ial ly for the middle section o f this road would have had severe environmental impacts in and around the East Lake, and has therefore been dropped. This road has been included in the overall poo l for the project with the understanding that an altemative northem alignment for the middle section will be examined. If no suitable alignment i s found, then the entire Qinghau Road project will be dropped and an altemative road further north (Luo Jia Zui to Dang Hu Gang), which fu l f i l l s the same traffic function, will be examined.

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RD1.5 Huangpu Lu: Improvement o f 4.61 km of the section o f the Dai Huang Highway between the central area and the MRR(N). The existing road i s congested and i t s widening will provide additional capacity to serve the newly expanding residential areas in the north-east o f the city.

RDI. 6 Old Hansha Highway: The project involves the removal o f a bottleneck (1.25 km) on the existing highway to provide a consistent 22m roadway (plus N M T lanes).

RD2.3 Qiaokou Lu Interchange: I t i s proposed to improve the junction between Jiefang Dadao and the northem approach to the Han River No. 4 Bridge. The improvement (a simple east-west flyover i s proposed, with an alternative 3-level solution also considered) will ease traffic circulation on the main road network and improve access to the (presently under-utilized) Han River No. 4 Bridge.

RD2.4 Shanlankou Interchange (cost includes Jinshui Lu Improvement (RD1.23)): This i s an improvement to a key junction in the inner area o f Wuchang at the intersection o f Hubei Lu and WuXian Highway. The improvement involves the construction o f an underpass and a looped ramp to connect the highway to Hubei Lu, which i s already at a low level where it passes beneath the main N-S rai l line. The scheme also includes the construction o f a short (320m) section o f Jinshui Lu. The interchange will improve traffic access and circulation in the area.

In addition RD2.5 Guocikou Interchange (see below) will improve operation o f the road network, whilst providing better access to the Han River No. 2 Bridge.

Urban Arterial & Local Roads::

RD1.13 Nanniwan Flyover (1.37km): The project involves the construction o f a 4-lane flyover across two main rail l ines and will provide improved access between the central business areas o f Hankou and the Qiaokou Economic Development Zone, and adjoining residential areas. Pedestrians and NMT will be provided with a subway.

RD1.16 JiangXiEr Lu (2.66km): A section o f new arterial road to provide improved access to and within the Qiaokou Economic Development Zone.

RDI. 17 YanHe Dadai (4.74km): Constructiodupgrading o f route along north bank o f Han River to provide improved access and radial movement.

RD1.23 JinShui Lu (330m):-Short length o f connecting road, to be constructed in conjunction with the Shanlankou Interchange (RD2.4).

RD1.30 Maying Lu (1.96km): A local link to improve network connectivity and local access.

RD1.32 Hanxi Lu: A short (430m) local missing connection.

Additionally, RD1.28 Meizi Lu (see below) will provide a significant new cross rail linkage.

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RN 2 Improve utilization of existing cross-river bridges

Three projects are specifically designed to improve the utilization o f the existing bridges across the Yangtse and Han Rivers.

RD2.1 Ramps to Yangtse No. 2 Bridge: The provision o f two new looped ramps i s proposed l inking the No. 2 Bridge directly with the northern riverside road. These ramps will al low a greater use o f the bridge and provide better distribution o f traffic onto the local road network.

RD2.5 Guocikou Interchange: The improvement involves the construction o f a looped link road beneath the southern approach to the Han River No. 2 Bridge to connect with, and provide access to, a new route built along the south side o f the river. The interchange will provide improved access to the bridge and will relieve other roads and junction in the area.

RD1.28 Meizi Lu (640m): The construction o f a short link passing beneath the main through ra i l line and providing improved access to the presently under-utilized H a n River No. 4 Bridge.

Additional six projects wil l provide some degree o f improved access to the existing bridges: the Middle Ring Road (North-East section (RD1.2) and Southern Section (RD1,3)), Qiaokou Lu Interchange (RD2.3), and Y o u Y i Lu (RD1.12). Xianggang Lu (RD1.8) and Xianggang Lu Interchange (RD2.7) will improve access to the proposed Qingdao Tunnel beneath the Yangtse.

RN 3 Relief of congestion in central areas

A total o f eight projects are designed to relieve congestion, mostly in the Hankou area. These projects include the construction o f three interchanges at key locations to ease traffic f low and enhance usage o f the inner ring road. The construction o f the MRR(N), which provides an altemative high-capacity route for east-west traffic, will greatly ease traffic congestion in the center o f Hankou.

Inner Ring Road: Three junction improvements are proposed on the Inner Ring Road (IRR). Redesign and reconstruction o f the Jiefang Dadao section (5.7 km) i s proposed under the road maintenance component.

RD2.6Xunlimen Underpass: A 4-lane vehicular underpass is proposed along Jiefang Dadao. The objectives o f the scheme are to al low improved access for pedestrians across the IRR at ground level (the route to the south provides a direct connection to the pedestrianised walking street), and to make improved provision for public transport.

RD2.7 Xianggang Lu Interchange (Hong Kong Lu Interchange): This location will become a key intersection between the IRR and the main northern approach route to the proposed Qingdao Tunnel beneath the Yangtse River linking the center o f Hankou with Wuchang. The f irst phase o f the improvement, involving a flyover along Jiefang Dadao, will be financed under the project. The scheme will al low for the improved operation o f the IRR and will permit local traffic and pedestrians to remain at ground level. Subsequent phases o f the interchange (not funded under the project) will add a second flyover (at level +2) and provide access to the proposed cross-river tunnel, and support development o f the long term central area network.

RD2.1 Ramps to Yangtse No. 2 Bridge, which form part o f the IRR, are described under the r i ve r crossing section above.

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Urban Arterial Roads:

RDl. 8 Xianggang Lu (Jianshe Dadao-Xinhuaxia Lu, 1.98km): Widening o f north-south route within Hankou will provide access to the proposed Yangtse River Tunnel. The project wil l improve traffic circulation within the down-town area o f Hankou and ease access to the proposed tunnel: it i s complementary to the proposed Xianggang Lu Interchange (RD2.7) at the junction with the IRR.

RD1.12 YouYi Lu (1.06km): Widening o f a section of an urban arterial within the central area o f Hankou will remove a bottleneck and provide a consistent cross-section. It will also improve access to the under-utilized Han River No. 3 Bridge.

RD1.15 Zhongshan Dadao (495m): Improvement o f a short link between the IRR (Jiefang Dadao) and the Riverside Road will ease access to the proposed bus interchange at the LRT terminal station.

RD1.20/21 Zhongshan BeiLu (2.30km): Construction andor upgrading o f two sections o f an urban arterial in the central area o f Wuchang will improve circulation and access to new development sites.

Local Roads: Two schemes are proposed for the improvement o f local roads in the inner areas o f Hankou District.

RD1.31 TaibeiYi Lu (1.50km): Completion o f missing sections o f a local road serving residential areas in central Hankou.

RD1.33 Luguoqiao Lu (825m): Widening o f a local route providing access to a proposed bus terminal at LRT station.

FW 4 Provide adequate road networks to support growth in development areas

RDl.10 & RDl.11: Jianshe Dadao (3.15km): A two-phase extension o f Jianshe Dadao into the proposed development area in the north-east o f the city, including the construction o f a new link across the main ra i l line. Two 12m wide subway boxes have already been built beneath the railway. The scheme will improve cross-rail capacity and provide access to the development area in the north-east.

RD1.14 HouHu Lu (5.1 O h ) : The road i s proposed as the major development spine to the expanding residential areas in the north-east o f the city. The scheme connects to Jianshe Dadao (RD1.11) and Huangpu Lu improvement (RD1.5).

RD1.18 Gong Ye DaDao (2.63km): A development road in the eastern area o f Wuchang, connecting with Qinghua Lu (RD 1.4) will provide a core network o f strategic roads. Since this road l i n k s with Qinghua Road, its inclusion for funding would depend o n the outcome o f the planned supplementary analysis for Qinghua Road (RD 1.4).

RD1.19 LuoShiNan Lu (2.48km): Comprises a southerly extension o f LuoShiBei Lu, which i s developing as a major link serving the South Lake residential development area. The proposed road will connect with the proposed Southern Section o f the MRR (RD1.3).

RD1.22 Qinyuan Lu (3.01km): A n e w link within the IRR in Wuchang will provide access to an area close to the central area with significant potential for redevelopment.

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RD1.25, RD1.26 & RD1.27 Shipailing Lu/Jisan Lu (4.93km): Two schemes that will provide improved and rationalized access to a recently developing residential area on the no longer used c iv i l airport in Wuchang .

RD1.29 Sixin Dadao (5.41km): A major new avenuehoulevard proposed to stimulate residential development in Hanyang in the area south o f MoShui Lake.

Additionally, three other projects, notably MRR(S) and Qinghua Lu, will significantly support the growth and expansion o f the proposed development areas.

RN 5 Provide safe conditions for pedestrians A total o f seventeen pedestrian footbridges or underpasses are proposed - nine in Hankou, six in Wuchang and two in Hanyang at a total cost o f U S $1 1 mil l ion. The proposed vehicular underpass at Xunlimen o n the IRR will provide improved facilities for pedestrians (and buses) at ground level.

Capacity Building and Technical Assistance (TA). The fol lowing Technical Assistance related to road network development will be provided as part o f the capacity building component 6: (i) Construction supervision (ii) (iii)

High strength bituminous concrete pavement study Road Safety Audit o f New Roads

Project Component 2 - US$33.40 million Traffic Management and Road Safety Component

This component addresses the WUTS problems o f congestion in the central area, inadequate cross-river capacity and pedestrian safety. I t also aims to increase the safety and productivity o f the road network by uti l iz ing modern traffic management techniques. Coordinated programs o f comprehensive traffic management measures will be implemented to complement the works in the road network and public transport components.

T M 1 Pedestrian Program. Investments made under this component in Hankou, Hanyang, Wuchang, Hongshan and Qingshan are complemented by investments in pedestrian facilities made as part o f the road infrastructure component. i) Mid-block signalizedpedestrian crossings at sixty-three locations. The design and location o f

these crossings would maximize pedestrian safety and convenience. All new crossings would be signalized with central safety islands for protection and storage; existing non-signalized zebra crossings would be replaced with signalized crossings in the A T C system. (The costs o f the signal works are included in TM5-ATC and the cost o f the central safety islands in TM4). Traffic signals at ninety-nine junctions in the ATC system would include pedestrian phases to cross al l arms o f the junction wherever possible. The pedestrian phase should not conflict with any vehicle tuming movements, especially right-tum-on red. (The costs o f the signal works are included in TM 5-ATC. The cost o f central safety islands is included in TM4).

ii)

iii) One pedestrian street

T M 2. Non-Motorized Vehicle Program Non Motor Vehicle (nMV) Routes - 60 km o f NMV priori ty routes with either MViNMV segregation or MV restrictions in Hankou, Hanyang, Wuchang, and Qingshan.

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T M 3 Bus Priority Measures Program Provision i s made for traffic facilities to implement 35km o f bus lanes o n nine routes. These compliment facilities to be provided in the public transport component. (Technical Assistance to assist with the further development and design o f bus priori ty measures and to assist with identification o f the potential for a bus rapid transit corridor i s discussed under Component 6).

District

WuchanglQingshan

Hanyang East Lake Hi-Tech Zone

TOTAL

T M 4 Junction Channelization and Traffic Facilities Program Junction channelization and traffic facilities (signs, lines and barriers) wil l be implemented at the 274 traffic signalized sites (including mid-block pedestrian crossings) in the A T C system to be provided under the project. Junction channelization will focus o n tightening up junctions, channelizing vehicles in direct and clear paths and bringing stoplines forward to minimize clearance times and increase efficiency. Junction channelization does not mean junction widening. This program consists of:

Existing New signals Total Of which are mid-block Area

upgraded signals to be to be installed pedestrian crossings

66 104 170 (33) 125k m2

11 45 56 (14) 20km2 14 34 48 (16) 12km2

91 183 274 63

0

0

46 channelization schemes involving physical c iv i l works 228 channelization schemes using hatched markings, road lining, signs and barriers

Road marking equipment (to paint and remove thermoplastic lines) directly concerned with these traffic facilities i s included in TM8.

T M 5 Area Traffic Control (ATC) and Traffic Signal Upgrading Program. ATC systems wil l be implemented in Hanyang, WuchangIQingshan and East Lake Hi-Tech Zone. Traffic signals operating under isolated control will be implemented in outlying areas. This program includes a total o f 274 locations, 18 o f which are isolated vehicle-actuated (VA) junctions, and 63 o f which are mid-block signalized pedestrian crossings. There will be 185 new signals and 91 upgraded signals, communication equipment, and equipment for two control sub-centers, one in Wuchang and one in Hanyang. Details are given in the Table below:

This component includes the installation (at the same t ime as the ATC) o f thirty-five C C T V real-time monitoring traffic cameras, and six Variable Message Signs (VMS) to facilitate better distribution o f traffic between the existing r iver crossings.

Technical Assistance will be provided in the design o f the A T C system and junction channelization covering the construction phase, including detailed design and implementation management and testing. This i s included in Component 6.

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T M 6 Road Safety and Accident Analysis Program This program will improve road safety and accident analysis procedures and consists of: (i)

(ii)

Enhancement o f the Trafic Management and Comprehensive Information System, including upgrading o f the satellite based positioning system. Accident Blackspot Improvements - Physical traffic engineering works or markings, road lining, signs and barriers to improve sixteen accident blackspot sites and thirty-two arterial roads with accident problems (mainly in suburban areas) Trafic Accident Investigation Equipment - equipment and special vehicles to improve accident response and on-site investigation. Electronic Police Camera Enforcement - red-light violation cameras at thirty junctions

(iii)

(iv)

In addition, an Accident Analysis Study using Technical Assistance i s included in Component 6.

T M 7 Road User Education (RUE) Program The RUE program, using a more pro-active approach, will focus o n children. The program consists o f :

Children Trafic Safety Playground and associated district education bases at nine sites Public Education Billboards - large and small public advertisement billboards RUE Columns in Local Newspapers - equipment to improve the RUE columns in local newspapers, and to improve images and electronic communication between the Traffic Police and the media RUE Helpline and Website - development o f a website and associated telephone helpline for al l road users Trafic T V Program - equipment to make a TV program to be broadcast daily Trafic Radio Program - development o f a traffic information radio broadcast station Trafic Safety Knowledge - designing and printing o f pamphlets for free distribution to children T M Information Map - development o f the Wuhan Traffic Management M a p and funding o f the inaugural edition

T M 8 Road marking equipment. Four motorized and seven hand-pulled road-marking vehicles to paint and remove thermoplastic lines, directly concerned with traffic facilities in TM4.

TM 9 Design/Administration. The cost o f feasibility study, traffic engineering design, i t s implementation, and administration wil l be financed by the municipality.

Capacity Building and Technical Assistance (TA). The fol lowing Technical Assistance related to traffic management and road safety will be provided as part o f the capacity building component 6:

i) ii) iii) Accident analysis study iv) Parking study v)

Bus priority planning and design Design of the ATC System and associated junction channelization.

Travel Demand Management (TDM) Study to develop potential measures such as a route guidance system using Variable Messaging Systems (VMS), managing vehicles by category and by time, and congestion charging. After the study, selected TDM measures could be implemented under the project, subject to availability o f funding at the time.

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Project Component 3 - US$ 34.20 million Public Transport The objective o f th is component i s to increase the efficiency, effectiveness and attractiveness o f bus services in the city. The content o f this component includes (i) introduction o f a computerized management information system to increase the efficiency o f operators in routine administrative and technical tasks, and o n street management o f bus operations (ii) improvement o f passenger facilities and service through construction or upgrading o f interchanges, termini and bus stops, and (iii) provision for a pi lot BRT scheme, should studies (to be financed under the project) indicate i ts viability. Technical assistance to support reform, for the design o f the CMIS, and for BRT studies i s included in component 6.

PT1 Computerized Management Information System (CMIS)

Currently, most o f the administrative and technical tasks in the bus companies are carried out manually with very little use being made o f computers. Many repetitive tasks, which are ideally suited to computerization, are done by teams o f workers and as a result staffing ratios are high. In an attempt to improve efficiency and quality o f work, it was decided that the project should encourage computerization for al l organizations involved with public transport in Wuhan.

In this subcomponent, a number o f manually performed tasks will be computerized. Init ial proposals in the computerization phase include management o f company records, staff records, salary calculations, passenger and revenue reporting, bus maintenance system, spare parts inventory, vehicle scheduling and driver rostering.

PT 2 Introduction of computerized satellite based vehicle location and control system

A computerized satellite based vehicle location system, with an operations center to control up to 600 buses o n twenty routes, will be developed as a demonstration project. The objective o f this system i s to achieve more regular dispatching o f buses, to improve schedule reliability (reduce bunching o f buses) o n the road (thereby reducing bus requirements) and eventually to provide waiting passengers with real time information o n bus amvals. The data gathered from the system can be used to improve vehicle scheduling. When competitive franchising of routes becomes operational under reform, the system can also be used by W T C to monitor the performance o f the operators.

PT 3 Interchanges

A total o f eleven interchanges are proposed. Of these, four (Wujiashan, Yongantang, Guanshanyi Road, Qingling) are associated with the removal o f long distance bus stations f rom the town center to outlying areas and which will also serve as termini for local routes. Of the remaining seven interchanges (Zhonghua Road, Taipingyang, Li j ibei Road, Sanyang Road, Yongqingjie, Guqintai and Yuejiazui), four will be situated at LRT stations and are intended, in part, to serve passengers interchanging between bus and rail. The remaining three are intended to act as major bus to bus interchanges for intra-Wuhan bus passengers.

The aim o f these facilities i s to shorten long routes that have loading imbalances, and to reduce the number o f duplicating routes o n major roads. The interchanges will also al low better facilities for passengers and should greatly reduce the walking distances required for transferring passengers.

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PT 4 Termini

Most o f the twelve proposed termini are located in the outer areas o f Wuhan and are intended to help the bus operators remove terminus points f rom their present on-street locations, and to improve operational control o f the services. They will also provide additional overnight and o f f peak parking capacity, and routine maintenance facilities in appropriate locations. The proposed sites for the termini are Qilixincu, Baibuting, Erqiaoxicu, Nanhuhuayang, Chenjiadun, Jianganxizhan, Gusaoshu, Houhu, Xiangyangcun, Xudong Road, Guanshan, and Tiejicun.

The above facilities (interchanges and termini) will require a total land area o f 160,700-sq. m.

PT 5 Bus Bays and Stops

Excessive channelization at bus stops together with overloaded stops, high bus volumes and poor on-street discipline results in long delays to buses. Under this sub-component, a total o f fourteen bus stops wil l be reconstructed, which wil l not only increase the number o f individual stops but will also remove the restrictive channelization. In some cases this involves lengthening the bus bays, in others it involves providing two parallel bays, while in some cases it simply involves lengthening the kerb distance available for bus stops. Some guidelines were developed to help in the design process, the key parameter being that the individual stops should not be forecast to operate at more than 85 percent o f theoretical capacity. Under this scheme the fourteen existing stops to be reconstructed are: Wusheng Road, Baofeng Road, Zhongshangongyuan, Xunlimen, Xinhua road, Qiouchangjie, Yongqingjie, Zhingnan Road, Dingziqiao, Fujiapo, Yuemachang, Hongshan, Guqintai and Wuqingsan Primary Road.

PT6 Provision i s made for the implementation o f a pi lot BRT scheme, should the studies o f P T Networks to be undertaken as part o f further work on the Wuhan urban transport strategy, (TA 3.7.1) and the associated BRT Study (TA 3.3.4) demonstrate a need. Design work would be undertaken under TA 3.3.5.

Implementation of Bus Rapid Transit

PT 7 DesigdAdministration - The cost o f engineering survey and design, implementation, and administration will be financed by the municipality.

Capacity Building and Technical Assistance (These are included in the capacity building component 6) include: 0 P T Management Information System Studies for user specification and definition o f the

PT Business development plan (like a 5-Year Plan) - support to operators to prepare these plans

Bus priori ty and Bus Rapid Transit (BRT) study

subsystems to be implemented in the sub-component P T 1 C M I S

including a route network development plan 0

0 Support for Reform

0 BRT Design Studies 0

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Project Component 4 - US$37.50 million Road Maintenance (RM) This component aims to assist the government's intention to reform the current road maintenance management system so as to increase the efficiency and effectiveness o f maintenance works, and the amount o f road maintained in good condition. WMG intends to introduce competitive tendering for routine works, but to retain in-house capability for emergency needs. The project provides for (i) the design (in component 6) and implementation o f a road maintenance management information system (in this component), (ii) the purchase o f advanced road maintenance equipment to improve the efficiency and effectiveness o f in-house emergency maintenance, and (iii) reconstruction o f ten o f the most damaged road sections in Wuhan.

RM1 Road Maintenance Civil Work. This sub-component involves the reconstruction o f the existing road pavement along ten o f the most heavily damaged roads in the city. The road cross-section will remain unchanged. The reconstruction will include the main carriageway, footpaths and NMV lanes. Traffic management or public transport improvement, if any, o n these roads i s described in the respective component.

RM 1.1, 1.2 and 1.3 Jiefang Avenue (Gutiansi to Hangkong to Huangpu to Chama - 15.1 km). This road was constructed in 1955. Other than some portions that were repaved in 1992, the road section has not been repaired so far. R M 1.4 1992. The remaining road sections o f the road have not been repaired so far. RM 1.5 Jianghanyiqiao road (32.2km). This road was constructed in 1956. The bridge was the f i rst bridge constructed cross the Yangtze river. N o major maintenance has taken place since. RM 1.6 Jiefangnan road (1.lkm). This road was constructed in 1980. No routine maintenance has taken place since. R M 1.7 Wangqinggong Road (13.1 km). R M 1.8 Hanyang Avenue (5.5km). This road was constructed in 1956. I t was reconstructed in 1986 and some re-paving was done in 1992. R M 1.9 Heping Avenue (1.3km). This road was constructed in 1956. No major reconstruction has taken place since. RM1.10 Gutianzheng Road (1.735km). One carriageway was constructed in 1989 to provide access to a Wor ld Bank financed wastewater treatment plant. The project will complete this road. RMl.11 Zhongshan Avenue (2.4km). This road was constructed before 1949. Although there has been some repaving, the condition o f the road condition remains very poor.

Wusheng Road (1.9km). This road was constructed in 1956. The flyover was repaved in

R M 2 Road Maintenance Works Equipment. W h i l e it i s the intention o f the Government to introduce competitive bidding for maintenance works contracts, some emergency works will continue to remain in-house. The equipment purchase includes routine road maintenance equipment, including: a pavement mill, concrete breaker, bituminous seam repairer, and a pipe layer.

RM3 Comprehensive Maintenance Management System. . T h e comprehensive system includes road pavement, b r idge and drainage maintenance management sub-systems. The main objective o f developing a comprehensive management system i s to provide municipal decision makers with a tool for the analysis o f maintenance requirements, for the planning, programming, and budgeting o f maintenance works, and the management o f the city road n e t w o r k database.

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There are four activities in this subcomponent: (i) (ii) IT system purchase (iii) (iv)

System design study - described in the technical assistance component (TA 3.6)

Init ial data collection and system implementation Data collection equipment, including road pavement test telecamera, conflict coefficient test vehicle, falling weight deflectometer, light road surface instrument, and bridge state test instrument.

The IT based management system will be procured after the completion o f the project-financed system study.

R M 4 administration. This will be financed by the Wuhan Municipal Government.

Road Maintenance recurrent cost including preparation, survey and design, implementation, and

Project Component 5 - US$5.50 million Environmental Protection This component includes measures to mitigate the short and long term environmental impacts o f increased travel, and the construction o f roads. I t includes (i) noise barriers, landscaping and other mitigation measures along new and widened roads, (ii) provision for expansion o f the existing air quality and noise monitoring system, and (iii) provision for upgrading o f the vehicle inspection and maintenance (YM) system. Design o f a Motor Vehicle Emission Control Strategy (MVECS) i s included in TA component 6.

EN 1 Wuhan Environmental Monitoring Center, an institute under Wuhan Environmental Protection Bureau (EPB), i s responsible for a l l environmental monitoring activities and environmental information management in the city. Consolidated and analyzed data f rom the Center to Wuhan EPB and the municipal government supports the decision making process for environmental policies, regulations, local environmental quality and discharge standards

Vehicle emission and traffic noise monitoring systems.

The subcomponent will help Wuhan Environmental Monitoring Center to substantially expand i ts existing air quality environmental monitoring system f rom five sub-stations to fifteen, and from l imited parameters for general air quality to more precise information for vehicle emission and traffic noise. This subcomponent includes procurement and installation o f equipment for automatic computerized monitoring for two vehicle emission monitoring sub-stations and seven traffic noise monitoring sub-stations, IT hardware and software and associated automatic data collection and analyses. I t will also include a vehicle for remote and mobile air quality monitoring, and a vehicle for motor vehicle emission monitoring.

EN 2 Motor Vehicle Emission Control Strategy (MVECS) The project will finance, under the Technical Assistance Component, a study to identify the most appropriate measures for the implementation o f a vehicle emission control strategy in Wuhan, within the framework o f the National Strategy. The study will include analysis o f characteristics o f vehicle emission in Wuhan, environmental impact f rom vehicle development, and measures for vehicle emission control, including an upgraded inspection and maintenance (I/M) system.

EN 3 for use on interchanges, air conditioners, double-glazed windows and ventilation facilities for residential buildings, and protection for noise sensitive sites, e.g., hospitals and schools.

Noise Mitigation. The project will provide facilities for noise mitigation, including noise barriers

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EN 4 environmental engineering design, local construction supervision, and the E M P implementation and administration financed by Wuhan Municipal Government.

Environmental Engineering Design and Management. This component includes the costs o f

EN 5 monitoring and supervision during the project construction and operation phases, and to ensure implementation and realization o f the Environmental Management Plan (EMP) endorsed by Wuhan Municipality.

Environmental Monitoring. This i s a locally financed component to conduct environmental

EN6 roads to be built under the project, which are included in the road network component.

Greeninfload Landscaping. The project will provide greening along the right-of-way o f the

EN7 o f A S M testing equipment and two sets o f actual driving mode testing equipment.

Upgrading o f Inspection and Maintenance (I/M) system. T h i s will include funding for nine sets

Capacity Building and Technical assistance In addition to the planned investment, the fol lowing analyses and studies related to environmental protection and management are proposed as part o f the capacity building component 6: i) ii)

Training for environmental management staff Preparation o f a Strategic Environmental Assessment (SEA) as a capacity building exercise for the Wuhan environmental agencies. The SEA process could then be used to assist decision making in future updates o f the Wuhan Transport Strategy.

Project Component 6 - US$7.90 million Capacity Building and Technical Assistance (TA)

This component will provide

their technical and management ski l ls

investigation and pol icy development o f issues and topics discussed during project preparation

0 domestic and intemational training for officials f rom project implementing agencies, to strengthen

consultant services to assist in project implementation, and to undertake studies for further

office equipment to enhance the productivity o f the implementing agencies

0

0

TA1 International Training This subcomponent wil l include a number o f intemational training tours and courses for staff f rom the concemed agencies. The proposed destinations for the tours include Nor th America, Europe, Brazil, Japan, Singapore and Hong Kong.. Final details o f each study tour wil l be decided over the course o f the project.

TA2 Domestic Training This subcomponent will include a number o f domestic training tours and courses for staff f rom the concemed agencies. The proposed destinations for the tours include Shanghai, Beijing, Guangzhou, Kunming, Shenzhen, Dalian, Urumqi, Hangzhou and Shijiazhuang. Final details o f each study tour wil l be decided over the course o f the project.

TA3 International and Domestic Consultant Services These services are listed under the component to which they relate.

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TA3.1 Construction Supervision TA3.1.1 for the road network development component in the supervision o f the c iv i l works construction during the entire implementation period.

Civil Work Supervision. These consultant services are to assist the implementating agency

TA3.2 Road Infrastructure

TA3.2.1 High Strength Bituminous Concrete Pavement Study. This study will be managed by the Road Network Development Component Agency in order to find the most suitable pavement material for the c i ty o f Wuhan.

TA3.2.2 Road Safety Audit of New Roads. This wil l introduce the concept o f Road Safety Audits, describe and illustrate the principles and procedures o f Road Safety Audits, carry out a Road Safety Audit o f the roads proposed under the Road Infrastructure Component at three stages: preliminary design, detailed design and pre-opening.

TA3.3 Traffic Management and Safety.

TA3.3.1 Parking Study - will provide assistance to the WPSB and other agencies to develop appropriate parking policies and strategies for both motor vehicles and non-motor vehicles. TA3.3.2 Design of the ATC System and associated junction channelization. Consultant services covering the construction phase, including detailed design, implementation, management and testing o f the goods and works in subcomponents TM 4 & 5. TA3.3.3 Detachment in accident analysis, and to establish an accident analysis system in Wuhan to complement the existing national TAIS. TA3.3.4 Travel Demand Management (TDM) Study. Assistance to WPSB to develop specific TDM measures appropriate for Wuhan in the context o f the WUTS, and taking account o f ATC and the results o f the parking study. TA3.3.1 Bus Priority Assistance to Wuhan Public Security Bureau and other local design institutes with the further development, design, implementation and operation o f bus priority measures to be implemented in subcomponent TM 3 o f the project. Includes advice o n international experience.

Accident Analysis Study. Assistance to enhance the capacity o f WPSB Traffic Police

TA3.4 Public Transport

TA 3.4.1 Design ofPTManagement Information System. The objective o f this TA i s to design the C M I S to be procured under subcomponent P T 1. The key tasks will include: (i) Identification o f the key activities to be computerized (ii) User specification o f the requirements o f the applications (iii) Assessment o f existing software that would be suitable to meet user requirements, with customization The client for the Computerization o f Basic Tasks wou ld be the Wuhan Group Public Transport Corporation (WGPTC).

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TA 3.4.2 Design of a satellite based Automatic Bus Location System. The objective o f this TA i s to design the satellite based Automatic Bus Location system to be procured under subcomponent PT 2. WTC and WGPTC will be joint clients. WGPTC and individual operators will need the system for operation o f the services, while WTC will need the system for monitoring o f service delivery. WTC and WGPTC would be joint clients for design o f th i s AVL System. WGPTC and individual operators will need the system for operation of the services, while WTC will need the system for monitoring o f service delivery.

TA 3.4.3 PT Business Development Planning. The objective o f th is subcomponent i s to improve the planning process for bus services in Wuhan by providing advice and on-the-job training to those involved in preparation o f the Five-Year Business Plans at each of the operating companies and other involved agencies. WGPTC will therefore be the primary client. The Plan(s) will be prepared by operators and the role o f the consultant will be to guide, assist and provide on-the-job training as required to those responsible for plan preparation. Assistance will also be given in setting up statistical information systems to provide the information required monthly by the Wuhan Transport Commission on PT usage and performance.

Preparation of a Five-Year Plan The Plan will consist o f the following elements:

(i) infrastructure (ii) (iii) (iv) (v) (vi) Ridership and revenue projections (vii) Capital investment program (viii) Operating cost forecasts (ix) increase requirement

Planning overview including population projections, new development areas and any new transport

Standards and guidelines to be adopted in planning for bus services Five-year bus route network development program Estimate o f new bus purchase and bus scrapping Estimate of depot and parking requirements

Overall financial position including al l financial support required from WMG and any fares

Training in Survey Techniques. In addition to advice on the preparation of Five-Year Business Development Plans, training will also be given in conducting bus passenger surveys, public transport trip demand surveys, and bus priority studies. Operators will be assisted to identify locations throughout Wuhan where buses are excessively delayed, either currently or likely to be in the coming five years. Data would then be passed on to the WPSB to plan, design and operate bus priority measures (see TA 3.4.6 & 3.4.7).

TA 3.4.4 PT Institutional Reform. The objective o f this TA would be to support the implementation (started in February 2003) of the reform program of WMG through the provision o f advisory services to Wuhan Transport Commission (WTC). Specific support i s expected to include the following:

(i) Assisting WTC in developing workable and effective tendering and franchising procedures by ensuring that a l l regulations necessary for the reformed structure are prepared; determining statistics to be reported monthly on public transport performance; and establishing procedures and penalties to ensure timely and accurate reporting (ii) Undertaking a fare setting and profit determination study, and to help establish a process for

regular review and adjustment o f bus fares.

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(iii)

(iiv)

(v)

Advising o n the steps in moving operators f rom SOE towards the creation o f shareholder owned companies, with particular regard to minimizing the impact o n staff. Assisting WMG to formulate more rational P T pol icy and regulation, and to refine the revised organization structure so as to achieve increased efficiency o f service Periodic assessment o f the effectiveness o f the reforms in terms o f achieving their stated objectives

TA 3.4.5 PT Route Network Planning. These studies would be designed to assist in

(i) (ii) (iii) (iv)

Undertaking o f o n bus passenger surveys and residents publ ic transport trip demand surveys, Restructuring o f the bus route network, including routes and schedules Identification o f possible additional locations for bus priori ty Identification o f possible corridors for busways

TA3.4.6 Bus priority and Bus Rapid Transit (BRT) Study. This i s a major study to be undertaken for the Wuhan Planning Bureau in conjunction with further work o n the Wuhan Urban Transport Strategy (see TA 3.7) by the Wuhan Planning Bureau. The t iming and content of this study should coordinate with studies carried out o n strategy and general bus priority. The main objectives o f this study are to: (i) corridor bus and passenger flows, and potential network redesign (ii)

Further review the need for bus priority in the bus network, taking into account delays to buses,

Assess the potential for BRT in the P T network (including normal bus, BRT, and metro), taking account o f corridor flows, availability o f road space to insert BRT, or the ability to widen roads to insert BRT

Develop and evaluate BRT proposals on a line by line and network basis

Identify ma in system design parameters, including bus types, stations, and ticketing system for the implementation o f BRT and bus priority

Prepare init ial concept cost estimates and implementation schedules

(iii)

(iv)

(v)

TA 3.4.7 BRT Design Provision o f consultant services for the preliminary design o f BRT schemes resulting f rom the study under TA 3.4.5 above. The work would be undertaken for the Wuhan Transport Commission.

TA 3.5 Road, Bridge and Drainage Maintenance Management System. Assistance in the design and implementation o f a comprehensive system for the analysis o f maintenance requirements, and the planning, programming, and budgeting o f maintenance works.

TA 3.6 Environmental management. The subcomponents o f th is TA are :

TA3.5.1. implementation o f measures proposed in the Wuhan MVECS, including the upgrading o f the I/M program in sub-component EN 7. TA3.5.2. and local design institutes in the techniques o f SEA, and assistance to undertake an init ial SEA for Wuhan related to further work o n the WUTS.

MVECS Planning and implementation. Assistance with the planning, design and

Capacity Building for Strategic Environmental Assessment (SEA). Training for WEPB

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TA 3.7. Wuhan Urban Transport Strategy (WUTS)

This will include (i)

(ii) (iii) (iv)

Capacity building o f the Wuhan Planning Institute and Wuhan Planning Bureau, particularly in transport planning, pol icy formulation and investment programming. International and local training for staff Consultant services for the enhancement o f the transport model Assistance with further studies, including, more in depth analysis o f (a) cross r iver travel demand (b) PT modes and networks (including the potential for BRT) (c) management o f central ci ty travel demand (d) 2007 - 2012 investment needs and (e) financial capacity Integration o f WUTS with the overall transport strategy for the entire municipality Support for production o f a “White Paper” urban transport pol icy statement and a 2007-2012

Development o f a Wuhan transport planning database.

(v) (vi) investment program based o n the results o f further studies. (vii)

TA 3.8 Travel needs of the disadvantaged and vulnerable. Fol low up to the survey undertaken during project preparation.

TA 3.9 Financial Management System. The objective o f this TA i s to strengthen financial and operational management, and computer based FM systems, including systematic training. The key tasks are the establishment and improvement o f a computer based financial management system, developing a financial model to assist the municipality to rationalize infrastructure capital investment, operations and maintenance, and a training program. This is a large TA with a very broad TOR, which includes aspects that relate to WUTS.

TA 4. Office Equipment This subcomponent will fund purchase o f office equipment to enhance productivity at the offices o f the implementing agencies.

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Annex 3: Estimated Project Costs CHINA: Wuhan Urban Transport Project

0.90 452.80

Traffic Management and Road Safety Public Transport Road Maintenance Environment Management Technical Assistance Total Baseline Cost

Physical Contingencies Price Contingencies 2.70 3.60

127.00 579.80 1 Total Project Costs I

16.40 Interest during construction 1 16.40

13.20 23.70 24.10

2.60 1.50

442.70 9.20

Front-end fee 2.00 Total Financing Required 452.80 145.40

18.60 7.70

12.10 2.70 6.00

120.70 3.60

2.00 598.20

31.80 3 1.40 36.20 5.30 7.50

563.40 12.80

Goods Works Services None Bank Finance

Total Project Cost: Interest during construction

Front-end fee Total Financing Required

6.40 26.20 32.60 217.00 94.80 311.80

1.50 6.00 7.50 227.90 0.00 227.90 452.80 127.00 579.80

16.40 16.40 2.00 2.00

452.80 145.40 598.20

1 Identifiable taxes and duties are 0 ( U S h ) and the total project cost, net of taxes, i s 598.2 (US$m). Therefore, the project cost sharing ratio is 33.43%) of

total project cost net of taxes.

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Annex 4: Cost Benefit Analysis Summary CHINA: Wuhan Urban Transport Project

Background

Economic analysis for the project was conducted as part o f the urban transport development strategic planning exercise. Prior to the preparation o f this project, Wuhan did not have adequate capacity in the areas o f strategic transport planning, traffic modeling, and project economic analysis. Through the preparation o f th i s project, Wuhan now has a comprehensive transport development strategy and an investment program up to 2007, which have provided a foundation for the definition o f the current project. Moreover, a network-based urban transport planning (UTP) model has been developed for Wuhan. This i s an important planning tool for strategic planning and evaluation o f investment programs. The model was built using a software package, EMMEl2, and was calibrated with data f rom household and citywide vehicle travel origin-destination surveys, and traffic counts at various locations. The model was then used to simulate network traffic performance under different scenarios -with and without the project. The simulation results, mainly in the form o f travel distance, time, and speeds for each personal or vehicular trip, were used to estimate the transport user benefits, Le. savings in personal travel time and vehicle operating costs.

The Formulation of Development Strategy and Investment Program

The strategic planning exercise included a detailed evaluation o f altemative strategies. Four altemative transport networks for year 2007 were tested using the newly calibrated UTP model. These alternatives included: (i) do-minimum; (ii) traffic management strategy; (iii) maximum transit; and (iv) maximum highways. On the basis o f a comparison in terms o f traffic performance and investment costs, a year 2007 preferred network was formulated, on which a budget-constrained investment program for the period 2003-07 was identified. The Wor ld Bank funded project was then defined from the investment program.

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[For projects with benefits that are measured in monetary terms]

maintenance costs Net Benefits: $706 m

IRR:

1 If the difference between the present value o f financial and economic flows i s large and cannot be explained by

taxes and subsidies, a brief explanation o f the difference is warranted, e.g. "The value o f financial benefits i s less than that o f economic benefits because o f controls on electricity tariffs."

23 Yo

Summary of Benefits and Costs: The components designed to improve traffic performance include the following: (a) road network development; (b) traffic management and road safety; (c) public transport service improvement; and (d) road maintenance. The transport network traffic benefits were computed for normal traffic and generated traffic, and the benefits for diverted traffic (redistribution o f traffic resulting f rom traffic diverted from alternate routes and modes because o f changes in relative trip costs) were implici t ly accounted for through the network model.

The quantified benefits include both savings in personal travel time costs and vehicle operating costs, which represent the major share o f the total project benefits. Other project benefits, such as improved traffic safety, reduced auto emission, and intra-city freight transport time savings were considered, but not in monetary terms due to lack o f reliable data. The ERR and NPV were estimated on the basis o f savings in personal travel time and vehicle operating costs against the total project costs including investment, operations and maintenance costs. As other benefits were not included in the calculation, the ERR and NPV presented in this Annex can be considered to be conservative estimates.

The cost o f each component included costs for physical works, detailed engineering design, and implementation supervision, and physical contingencies. Annualized operations and maintenance costs were also included in the evaluation.

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Bicvcles 16% Passenger cars

Main Assumptions: Traffic growth rates were based o n future population and income growth projected in Wuhan's economic planning (see Table below). Total person trips are expected to grow with population. Motor vehicle ownership i s expected to grow at the similar rate as GDP growth, and this forecast i s consistent with Wuhan's historical data for the last 20 years.

26% Taxicabs 26%

kUS$) I I I I I

Buses Goods vehicles Total

The discount rate or economic cost o f capital used in the analysis was 12%.

A standard conversion factor o f 0.9, which i s the latest Wor ld Bank estimate for China, was used to convert financial costs to economic costs. For physical components, annual operations and maintenance cost was assumed to be 2.2 percent o f capital cost. The assumed project l i fe for the purpose o f economic analysis was 20 years with 50 percent assumed salvage value for capital investments.

Unit vehicle operating costs (VOC) by vehicle type and passenger travel time costs by mode were based on locally provided basic cost data. VOC for mode i was calculated using the fol lowing formula:

VOCi = Ai + Bi (Us) [l + 0.2 (V/C)] [l + 0.2 (V/C)],

where Ai and Bi are empirical parameters for mode i, s i s vehicle travel speed on the link, V i s link vehicle volume, and C i s link capacity.

Fol lowing the guidelines suggested in the Wor ld Bank Infrastructure Note No. OT-5, "The Value o f Time in Economic Evaluation o f Transport Projects," the fol lowing values o f travel time were assumed.

19% 11% 100%

2000

1 Business trips

2005 2010 2020

130 percent o f household hourly wage, considering cost to emdovers

PoDulation (million) I 7.49

I Other non-commuting and school trim 11 5 Dercent o f household hourlv income I

7.97 8.45 9.70

- 6 1 -

GDP (billion Yuan) 120.7 GDP growth rate 12% Per capita GDP $2,014

220.0 338.5 666.0 12% 9% 7 yo

$3,450 $5,007 $8,582

Trip Purpose Commuting trips

Value 30 percent o f household hourly wage, based on international empirical evidence

Sensitivity analysis I Switching values of critical items: The sensitivity analysis tested the project viability under a number o f scenarios. The major sources o f down-side r isks were identified to be: (i) traffic growth lower than what was expected; (ii) V O C savings lower than expected; (iii) value o f travel time lower than expected; (iv) project cost overrun; and (v) a combination o f cost overrun and benefit reduction. The results o f the analysis, shown in Table below, suggested that the project was robust to traffic, cost, and benefit variations.

(a) Base case (b) Traff ic growth rate reduced by

20%

I Scenario I ERR I N P V at 12% discount rate I 23.0% $706 mi l l ion 22.0% $630 mi l l ion

I (c’l Benefit reduction bv 20% I 19.8% I $4 15 mi l l ion I I (d) Cost overrun bv 20% I 20.4% I $541 mi l l ion I

A detailed technical document on the economic analysis, prepared by Wuhan City Comprehensive Transport Planning and Research Institute, i s included in the project file.

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Annex 5: Financial Summary CHINA: Wuhan Urban Transport Project

Years Ending

I IMPLEMENTATION PERIOD I Year1 I Year2 I Year3 I Year4 I Year5 I Year6 I Year 7

Total Financing Required

Project Costs Investment Costs 78.4 227.1 144.1 81.4 34.8 5.7 0.0 Recurrent Costs 3.7 1.8 1.1 0.9 0.8 0.0 0.0

Total Project Costs 82.1 228.9 145.2 82.3 35.6 5.7 0.0 Interest during 2.2 1.8 2.6 3.2 3.2 3.5 0.0

Front-end fee 2.0 0.0 0.0 0.0 0.0 0.0 0.0 construction

]Total Financing 86.3 230.7 147.8 85.5 38.8 9.2 0.0

1 Financing IBRDIIDA 0.0 106.6 58.6 23.4 5.7 5.7 0.0 Government 71.7 138.7 89.2 62.0 33.1 3.5 0.0

Central 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Provincial 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Co-financiers 0.0 0.0 0.0 0.0 0.0 0.0 0.0 User FeeslBeneficiaries 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Financing 71.7 245.3 147.8 85.4 38.8 9.2 0.0

Total Financing Required Project Costs

Investment Costs 78.4 227.1 144.1 81.4 34.8 5.7 0.0 Recurrent Costs 3.7 1.8 1.1 0.9 0.8 0.0 0.0

Total Project Costs 82.1 228.9 145.2 82.3 35.6 5.7 0.0 Interest during 2.2 1.8 2.6 3.1 3.2 3.5 0.0

construction Front-end fee 2.0 0.0 0.0 0.0 0.0 0.0 0.0

Total Financing 86.3 230.7 147.8 85.4 38.8 9.2 0.0

Financing IBRDIIDA 0.0 106.6 58.6 23.4 5.7 5.7 0.0 Government 71.7 138.7 89.2 62.0 33.1 3.5 0.0

Central 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Provincial 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Co-financiers 0.0 0.0 0.0 0.0 0.0 0.0 0.0 User FeeslBeneficiaries 0.0 0.0 0.0 0.0 0.0 0.0 0.0

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Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Financing 71.7 245.3 147.8 85.4 38.8 9.2 0.0

Main assumptions:

Table 1 Wuhan Municipal Finance @MB billion, current terms)

Table 2 Wuhan Public Transport Basic Data

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Annex 6(A): Procurement Arrangements CHINA: Wuhan Urban Transport Project

Procurement Procurement Capacity Assessment Report - Summary of Findings

1. activities. WMG has established a Project Off ice (WUTPO) under the Wuhan Urban Construction Fund Management Office (WUCFMO) to conduct the day-to-day management o f the proposed project, and to coordinate with four sub-project offices: a sub-WUTPO in Wuhan Bridge Construction Company for the c iv i l work o f the road network development and road maintenance components; a sub-WUTPO in the traffic management bureau o f the Wuhan Public Security Bureau for the traffic management component; a s u b - W T P O in the Wuhan Transport Commission for the public transport component; a sub-component in the Wuhan Urban Management Bureau for road maintenance institutional strengthening part o f road maintenance component, and a sub-WUTPO in the environment monitoring station for the environment monitoring component. Most procurement activities before contract award will be carried out by WUTPO and the activities after contract award will be implemented by the four

Wuhan Municipal Govemment (WMG) i s responsible for a l l project-related procurement

sub-WUTPOs.

2. As govemment institutions, WUTPO and the four sub-WUTPOs have been fully authorized and staffed to implement the project. WUTPO has accumulated experience on Bank procurement policies and procedures through project preparation and procurement for PHRD contracts. A training course o n the Bank guidelines was conducted during project preparation. WUTPO i s able to fulfill i t s procurement function with the support o f the municipal govemment, consultants and a procurement agent.

3. for the project. Wuhan Municipal Engineering Design & Research Institution Company Ltd. (WMEDRIC) i s the designer o f the project responsible for preparation o f the specifications and drawings o f the bidding documents. C ITC was the procurement agent for other Bank financed urban transport projects. They are competent and experienced in Bank-financed procurement.

WUTPO has selected the China Intemational Tendering Company (CITC) as procurement agent

4. China, including some aspects o f the Bidding L a w for construction projects that became effective January 1,2000 and Government Procurement L a w that became effective January 1,2003. The shortcomings include:

The Bank team assessment identified some shortcomings in the general procurement framework in

0 requirement for the purchaser to confirm in the bidding documents that he possess or secure sources o f funding for procurement before bidding. a broader range o f channels to announce the bid invitation including newspapers, information networks, etc. minimum time for bid preparation and submission o f 20 days. requirement for re-bidding if fewer than three bids are received. requirement to reject bids lower than cost, but without stipulating the method to determine

0

0

0

0

the cost. 0 evaluation by scoring allowed.

5. for I C B goods procurement, both before the draft bidding documents are submitted to the Bank and

One o f the concems identified during the assessment i s the length o f GOC intemal review process

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before the bid evaluation reports are submitted to the Bank for review. The Mechanical and Electrical Product Import and Export Department (MEPIED) o f the Ministry o f Foreign Trade and Economic Cooperation (MOFTEC, which becomes Ministry o f Commerce after March 2003 by merging with State Economy and Trade Commission) i s authorized to conduct such reviews. The review period can be lengthy when disagreements arise among the government agencies involved in the review process. To mitigate this risk, procurement planning wil l need to incorporate additional time for the review processes.

ASAP The procurement manual describing a l l the procurement procedures to be fol lowed

6. These are country-wide issues which were addressed in the OPR for China. Provisions will be incorporated into the Procurement Schedule o f the Loan Agreement to confirm exemptions for Bank financed procurement f rom the Bidding L a w and Government Procurement L a w o f China in case o f discrepancies between the Bank Guidelines and the Laws. Wuhan Municipal Government and WUTPO are committed to fol lowing the Bank's guidelines. Wuhan Municipal Government will s ign a supplementary letter (See Appendix 5 o f the assessment report for details) to the loan agreement, to this effect or incorporate it directly into the legal documents.

2003 April , 2003

7. assessment (discussed during project preparation) to strengthen the capacity o f implementing agencies, including the preparation and distribution o f a procurement manual to a l l procurement staff, on-the-job training, and occasional procurement seminars and workshops. The Bank wil l monitor procurement closely through i ts prior review procedures, seminars/workshops, supervision missions, and procurement post-review missions.

WUTPO has agreed to implement the recommendations in the action plan o f the procurement

in Bank-financed procurement and responsibility o f each organization handling procurement shall be distributed to al l procurement staff including staff for the easy reference. The procurement manual will be a part o f overall quality control system The WMCC, WUTPO wou ld organize periodically, ,or send staff out, for procurement training seminars, study tours and workshops for procurement staff and other staff in implementing agencies, particularly for staff in sub-WUTPO. On the job training shall be conducted for al l staff f rom time to time to strengthen the agency's capacity to implement the procurement for the project.

8. action plan to further strengthen procurement management capacity was prepared by WUTPO and discussed during pre-appraisal mission. Fol lowing action plan was incorporated into the PIP.

The r isks in the procurement process are considered to be average relative to other operations. An

From time to time

Pronosed Act ion Plan I Due Date Procurement staff shall be o n board in al l Droiect imdementation agencies I March. 2003 Bidding documents for retroactive contracts shall be submitted to the bank for review I March-October,

Procurement Arrangements

9. Procurement Plan. A procurement plan has been prepared using Microsoft Project and i s included in the Project Implementation Plan (PIP). The procurement packaging plan has been prepared taking into consideration the prospective capabilities o f the contractors and suppliers (both Chinese and intemational), as wel l as capabilities o f the employers project management. The procurement plan will be adjusted and updated annually to reflect the latest changes in the project implementation schedule.

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10. procurement under the project:

Procurement procedures. The following Bank guidelines will govem all Bank-financed

0 For goods and works. Procurement under IBRD Loans and IDA Credits (dated January 1995 and revised in January and August 1996, September 1997 and January 1999).

0 For the selection of consultants. Selection and Employment o f Consultants by World Bank Borrowers (dated January 1997 and revised September 1997, January 1999 and May 2002).

Format of the Documentation. The following formats will apply:

11. Evaluation reports. The Bank's Standard Bid Evaluation Form, Procurement o f Goods or Works (dated April 1996, translated into Chinese by M O F M a y 1997), and Sample Form o f Evaluation Report for Selection o f Consultants (dated October 1999).

12. (dated M a y 1997), prepared by MOF based on the Bank's Standard Bidding Documents (SBDs) w i l l be adopted for all ICB and N C B activities for goods and works.

Model Bidding Documents. The Bank-approved Chinese Model Bidding Documents (MBD)

13. Revisions to Model Bidding Documents. The amendments included in the Bank's updated Standard Bidding Documents (SBD) for Procurement of Goods (dated January 1995 and revised March 2000 and January 2001, March 2003) and Works (dated M a y 2000 and revised March 2002, March 2003), which have not yet been included in the MBD, dated May 1997, will be incorporated into the bidding documents used for ICB goods and works contracts. When Bank's new SBD for ICB Goods and Works based on Master Procurement Documents prepared by Multilateral Development Bank and Intemational Financing Institutions are issued, Chinese MBD (except N C B Goods and Works) will no longer to be used.

14. March 2003 will be used for procurement o f the area traffic control system.

SBD for Supply and Installation o f Plant and Equipment, November 1997, revised January 1999,

15. based on Master Procurement Documents prepared by Multilateral Development Bank and Intemational Financing Institutions, Standard Request for Proposals, etc. will be used for large civil works ICB contracts above US$ 15 million.

Prequalification Documents for Procurement o f Works and User's Guide dated November 2002

16. Domestic Preference. For goods contracts, qualified domestic bidders will be eligible for a preference equal to 15 percent o f the cost, insurance and freight (CIF) price, or the sum o f the customs duties and import tax payable by a nonexempt importer, whichever i s less. For works, there wi l l be no preference for domestic contractors as China GDI has exceeded the Bank determined threshold.

17. Development Business (UNDB), Issue No. 596 o f December 16,2002. Specific Procurement Notices (SPNs) for all ICB and N C B procurement activities w i l l be published in at least one newspaper with a national circulation in addition to UNDB and dgmarket.com for all ICB contracts. The ICB bidders will be allowed at least 6 weeks for bid preparation (8 weeks for contracts above US$15 million). Similarly,

Advertisement. The General Procurement Notice (GPN) was published in the United Nations

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invitations for expressions o f interest for consulting contracts expected to cost more than US$200,000 equivalent will also be advertised in the UNDB at least 14 days before the preparation o f the short l ist.

18. US$200,000 and al l consulting services under QCBS/QBS procedures shall be published in a national newspaper. The specific procurement notice for N C B c iv i l works below US$2 million, and NCB goods below US$200,000 may be published in a provincial or municipal newspaper.

The specific procurement notice for N C B c iv i l works above US$2 million, NCB goods above

Procurement Methods (Table A)

19. the fol lowing procedures:

A total o f US$334.5 mi l l ion o f works and goods i s expected to be financed under the project, using

Works : (US314 million, including contingencies)

20. percent o f total works procurement. The bidders for these larger works contracts will be prequalified.

ICB. About US$54.1 mi l l ion o f works wil l be procured using I C B procedures. This represents 17

21. NCB. About US259 .8 mi l l ion o f other c iv i l works estimated to cost below US$15 mi l l ion will be procured using N C B procedures. Such contracts will not be o f interest to foreign contractors and bidders wil l be post qualified.

22. detailed designs and counterpart funds, the need to accommodate existing heavy traffic and traffic management during the construction period, resettlement, and relocation o f underground utilities. The contracts will be bid o n a slice-and-package basis; qualified f m s will be allowed to bid for more than one contract. Each ICB contract for works will provide for a dispute review board or dispute review expert in the standard bidding documents (referred to in paragraph 2.42 o f Guidelines: Procurement under IBRD Loans and IDA Credits)

The contract packaging was determined taking into consideration construction time, availability o f

23. flyovers or underpasses, traffic signs, road markings, power supply and street lighting, noise barriers, landscaping and greening, and relocation o f under street services lines (for power, telecommunication, gas, CCTV, water, or wastewater). These works will be included in the c iv i l work contracts to the extent possible. However, if the prime contractor does not have the experience or the necessary qualifications, the works shall be carried out by specialist sub-contractors and experience and qualification o f specialist sub-contractors shall be stated in the bids submitted by prime contractors.

I t was agreed that special attention would be paid to the design o f specialist works such as rai lway

Goods:(US$30.5 million, including contingencies)

24. ICB. About US$27 mi l l ion worth o f equipment estimated to cost US$500,000 or more per contract will be procured using I C B procedures. This represents about 88 percent o f total procurement o f goods, some o f which will be combined with installation services.

25. than US$500,000 per contract wil l be procured using N C B procedures. These contracts wil l not be o f interest to foreign suppliers.

NCB. About U S 2 . 9 mi l l ion worth o f equipment estimated to cost US$lOO,OOO or more but less

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26. Shopping. Other minor items (US$600,000) which are readily available off-the-shelf and estimated to cost less than $100,000 per contract, wil l be procured fol lowing Shopping procedures on the basis o f a comparison o f at least three quotations at competitive prices and may be used where the desired goods are ordinarily available f rom mor6 than one source, as stated in Articles 3.5 and 3.6 o f the guidelines.

Consultants (US $7.5 million, including traininghtudy toudseminars):

27. US$7.1 million. (There are 2 type overseas traininghtudy tours in the Procurement Plan: one i s the overseas traininghtudy tours as a part o f consultant services contracts for research and management etc; the other i s the stand along overseas traininghtudy tours organized by agents through selection procedures o f QCBS. So the cost o f a l l overseas traininghtudy tours i s included in the consultant contracts. However, the overseas trainindstudy tours may be conducted in the same way as for domestic traininghtudy tour during the implementation.) As for the domestic seminars, training and study tours, there will be no contracts signed. The cost o f domestic trainindstudy toursheminars wil l be reimbursed against receipts for an estimated US$400,000. Consultants financed by the Bank and required for research, construction supervision, overseas training and study tours will be selected and employed under QCBS/QBSLCS/CQ/SSS/IC (Individual Consultants) procedures.

This component includes consultant services and overseas traininghtudy tours for an estimated

28. QCBS/QBS/LCS: Consulting services f rom f m s with an estimated contract value o f US$lOO,OOO or more to a total value o f US$6.1 mi l l ion will be procured through Quality- and Cost-Based Selection (QCBS - about US$ 5.3 million) or Quality-Based Selection (QBS-about US$ 400,000) or Least Cost Selection (LCS-about US$400,000 for contracts less than $200,000 each).

29. to a total value o f US$600,000 will be selected through Consultant's Qualification selection (CQ). Some services with an estimated contract o f less than US$lOO,OOO up to a total value o f US$200,000 in amount may, with the Bank's prior agreement, be procured by Single-Source Selection (SSS) in accordance with the provisions o f paragraphs 3.8 through 3.1 1 o f the Consultant Guidelines. Services o f individual Consultants (IC) with an estimated contract o f about US$200,000, will be procured in accordance with the provisions o f paragraphs 5.1 through 5.4 o f the Consultant Guidelines.

CQ/SSS/IC: Consultant services f rom f i r m s with an estimated contract o f less than US$lOO,OOO

30. tours.

Local Training and Study Tours: About US$400,000 will be spent on local training and study

3 1. Local consultants f rom various independent universities and institutes will be used to the extent possible ensuring that eligibility requirements stated in the Guidelines are met and their participation i s consistent with Bank requirements o n hiring universities and institutes. The threshold for shortlist o f only national consultants will be $300,000 or less.

Advance Contracting

32. after June 16,2003. Expenses to be incurred in advance by the implementing agency are estimated at less than US$15 mil l ion. These expenses include eleven N C B works contracts, one N C B goods contract, and seven Shopping contracts, and consultant services and traininghtudy tours o f nine contracts. All these contracts are eligible for retroactive financing by the Bank. Bank procurement guidelines have been strictly followed as in normal operations for al l advance contracting activities.

WUTPO has requested advance contracting and retroactive financing for the f i rst year construction

'

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Procurement methods (Table A)

6. Interest during construction

7. Front-end fee

Total

33. Table A l ists costs and financing by procurement method; Table A1 l i s t consultant selection arrangements.

Table 1 lists major contracts, their estimated value, scheduled start, and procurement method;

(0.00) (0.00) (0.00) (0.00) (0.00)

(0.00) (0.00) (0.00) .(O.OO) (0.00) 0.00 0.00 2.00 0.00 2.00

(0.00) (0.00) (2.00) (0.00) (2.00) 81.10 262.70 10.10 244.30 598.20

(52.10) (138.50) (9.30) (0.00) (199.90)

0.00 0.00 0.00 16.40 16.40

Table A: Project Costs by Procurement Arrangements (US$ million equivalent)

li Figures in parenthcses are thc amounts to be financcd by the Bank Loan. All costs includc contingencies

Includes c iv i l works and goods to be procured through national shopping, consulting services, services o f contracted staff o f the project management office, training, technical assistance services, and incremental operating costs related to (i) managing the project, and (ii) re-lending project funds to local government units.

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Table A I : Consultant Selection Arrangements (optional) (US$ million equivalent)

I Including contingencies

Note: QCBS = Quality- and Cost-Based Selection QBS = Quality-based Selection SFB = Selection under a Fixed Budget LCS = Least-Cost Selection CQ = Selection Based on Consultants' Qualifications Other = Selection of individual consultants (per Section V of Consultants Guidelines), Commercial Practices, Single Source Selection, Domestic Training and Study Tours etc. N.B.F. = Not Bank-financed Figures in parentheses are the amounts to be financed by the Bank Loan.

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Prior review thresholds (Table B) Prior Reviews required by the Bank:

1. mi l l ion or more, goods contracts with an estimated cost o f US$400,000 or more and consulting services with an estimated contract cost o f US$200,000 or more for f i r m s and US$50,000 or more for individuals. This wil l apply to 82 percent o f the total contract values o f works, 90 percent o f the total contract values o f goods and 72 percent o f the total contract values o f services financed by the Bank. Single-source selections, regardless o f the value o f the contract, wil l be subject to the Bank's prior review. The first contract o f any type including the f irst contract for NCB, Shopping, QCBS/QBS/LCS, CQ/SSS and individual consultants wil l also be submitted to the Bank for prior review.

Prior review procedures will be used for c iv i l works contracts with an estimated cost o f US$4

All other contracts for works, goods and services will be subject to ex post review. About 33% o f such contracts will be sampled for ex post review.

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If the procurement under the project follows the Bank's procurement policy during the 18 months implementation period (Jan. 1,2004 to June 30,2005), and subject to the Bank's review and final agreement, the prior review thresholds could be increased to $5 mil l ion for works, $500K for goods, $350K for consultant firm and $100K for individual consultants after July 1, 2005.

Table B: Thresholds for Procurement Methods and Prior Review'

1. Works Prior review threshold >US$4 million 2. Goods Prior review threshold >US$400 thousands

3. ServicesPrior review threshold: >US$200 thousands for firm >US$50 thousands for individual consultant

>15,000 < 15,000

L 500 < 500

<loo > 100

< 100

ICB NCB

ICB NCB

Shopping QCB S/QB S/LC S

CQ Single source

Individual Consultants

Al l contracts ($54 million), All contracts above $4

million. ($208) All contracts ($27 million)

All contracts above $400,000

($430.000) All contracts above

$200,000 ($4.6 mil l ion )

All contracts ($0.2 million) All contracts above

$50,000 ($0.2 mil l ion )

Total value of contracts subject to prior review:

Frequency o f procurement supervision missions proposed:

US$282 mil l ion

One every 6 months (includes special procurement supervision for post-review/audits)

Overall Procurement Risk Assessment: Average

Most o f the procurement prior review wil l be handled by procurement specialists o f the Bank's Beijing office (WBOB), while post review may be out sourced to independent consultants by WBOB.

Thresholds generally differ by country and project. Consult 'Rssessment o f Agency's Capacity to Implement Procurement" and contact the Regional Procurement Adviser for guidance.

1\

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Annex 6(B): Financial Management and Disbursement Arrangements CHINA: Wuhan Urban Transport Project

Financial ManaPement

1. Summary of the Financial Management Assessment The task team conducted an assessment o f the adequacy o f the project financial management system o f the Wuhan Urban Transport Project (WUTP) (complete FM assessment report i s available in project file). The assessment, based on guidelines issued by the Financial Management Sector Board o n June 30, 2001, concluded that the project meets minimum Bank financial management requirements, as stipulated in BP/OP 10.02. In the team opinion, the project will have in place an adequate project financial management system that can provide, with reasonable assurance, accurate and timely information on the status o f the project in the reporting format agreed with the project and as required by the Bank.

Funding sources for the project include the Bank loan and counterpart funds. The Bank loan agreement will be signed between the Bank and the People's Republic o f China through i t s Ministry o f Finance (MOF), and on-lend agreement will be entered between MOF and the Government o f Hubei province through its Hubei Provincial Finance Bureau (HPFB), HPFB and Wuhan Municipal Finance Bureau (WMFB) and Wuhan Urban Construction Uti l izat ion o f Foreign Investment Project Management Office (WUCUFIPMO). The Bank loan proceeds will f low f rom the Bank to HPFB (where the special account for the project will be set up), to WMFB, to WUCUFIPMO and/or to contractors or suppliers v ia bank accounts with major commercial banks acceptable to the Bank. Disbursement will be based o n the traditional disbursement techniques and will not be using PMR-based disbursements, in accordance with the agreement between the Bank and MOF. The counterpart funds will be contributed directly to WUTP, mainly by the government o f Wuhan Municipality.

N o outstanding audits o r audit issues exist with any o f the implementing agencies involved in the proposed project. The task team however will continue to be attentive to financial management matters and audit covenants during project supervisions.

Country Issues To date, no C F A A has been performed for China, though dialogue with the Government o f China in respect to the C F A A exercise has been initiated and i s underway. The planned approach to C F A A i s to build o n the Asian Development Bank study o f Financial Management and Governance Issues in China in 2000, analyze areas that have changed significantly in the past few years o r that deserve further scrutiny, and over t ime cover a l l major areas usually assessed as part o f a full C F A A exercise. Currently, for reference purpose, the Bank relies on the study conducted by the Asian Development Bank.

Nevertheless, based o n observations o f developments in the areas o f public expenditures, accounting and auditing, and Bank experience with China projects for the past few years, we note that substantial achievement in the aforementioned areas has been made and further improvement i s expected in the next few years. As the economic reform program further unfolds, the Government o f China has come to realize the importance o f establishing and maintaining an efficient and effective market mechanism to ensure transparency and accountability, and minimize potential fraud or corruption.

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Due to a rather unique arrangement by the Government o f China, funding (in particular Bank loans) o f Bank projects i s controlled and monitored by MOF and i ts extensions, i.e. finance bureaus at provincial, municipaVprefecture and county level. However, project activities are usually carried out by implementing agencies o f a specific industry or sector due to the nature o f the technical expertise involved. The above arrangement usually requires closer coordination on the project, otherwise, the multi-level management o f the funding and implementation mechanism sometimes work to the detriment o f smooth project implementation. As such, th is assessment focuses o n Hubei Provincial Finance Bureau, which will handle Special Account activity for the project, and the Wuhan Project Management Office, which will be responsible for implementing various components o f the project.

Strengths HPFB and WMFB have had prior Bank project experience and are expected to play a major role in the project financial management aspect, and are familiar with Bank policies, procedures and requirements.

Weaknesses: (1) WUCUFIPMO has no prior management experience with Bank projects; close monitoring and training wil l be provided by WBOB, HPFB and WMFB (2) Change o f current project organization structure i s expected; the WUCUFIPMO agrees to inform the Bank o f such change by appraisal.

Implementing Entity Provincial Project Leading Group (PPLG). The PPLG i s chaired by the Vice Govemor o f Hubei province. The purpose o f the PPLG i s to coordinate between different provincial governmental agencies, including Hubei Provincial Development and Planning Commission, Hubei Provincial Construction Commission, HPFB and Hubei Provincial Environment Protection Bureau.

Municipal Project Leading group (MPLG). The MPLG i s chaired by the Mayor o f Wuhan municipality. Purpose o f M P L G i s to coordinate between different municipal governmental agencies, including Wuhan Municipal Development and Planning Commission, Wuhan Provincial Construction Commission, WMFB and Wuhan Provincial Environment Protection Bureau.

Project Manugement Ofice. WUCUFIPMO will work as the Project Management Office (PMO) for the project, assuming direct implementation and coordination responsibility. Though WUCUFIPMO i s expected to be merged into another organization in the near future. However, it i s expected that it will remain as the executing agency for the entire project implementation.

HPFB i s expected to play a major role in project implementation, including overall monitoring, financing arrangement, procurement, and financial management. HPFB will also be responsible for maintaining, monitoring and reconciling project special account, which will be set up in and kept by HPFB. HPFB and WMFB will be responsible for reviewing, veri fying and approving withdrawal applications prepared by WUCUFIPMO before HPFB submits them to the Bank for disbursement processing. HPFB and WMFB have had prior experience with the Bank projects and are familiar with Bank disbursement procedures.

Funds Flow a) Bank funds will flow from the Bank to the special accounts to be set up for the project, and/or contractors or suppliers. The special account wil l be set up in and managed by HPFB. On-lending agreements will be signed between MOF and HPFB, between HPFB and WMFB, and between WMFB and WUCUFIPMO.

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Thc 1 IPFB

Bank World +

b) Counterpart funds will be contributed by WMFB directly to WUCUFIPMO.

WMFB

Staffing Adequate project financial and accounting staff with educational background and work experience commensurate with the work they are expected to perform i s one o f the factors critical to successful implementation o f project financial management. Based on discussions, observation and review o f educational background and work experience o f the staf f identified for financial and accounting positions, the task team noted that they are appropriate for the work they are expected to assume. However, considering that most financial s ta f f do not have the accounting related education background, more training and guidance wil l be required. The task team has advised WUCUFIPMO that adequate and qualified project financial and accounting staff should be identified prior to Board presentation and in place before effectiveness.

Accounting staff in WUCUFIPMO has n o prior experience with projects financed by the Bank. To strengthen financial management capacity and achieve consistent quality o f accounting work, the task term has suggested that a wel l defined and focused training in project financial management should be provided by WUCUFIPMO, HPFB and WMFB prior to effectiveness to al l key financial and accounting staff to ensure good understanding o f the Bank policies and procedures.

In addition, in order to provide easy and readily available reference, WUCUFIPMO has submitted to the task team a draft project financial management manual (FM Manual), which provides detailed guidelines o n financial management, intemal controls, accounting procedures, fund and asset management and withdrawal application procedures. After review, the manual has been accepted by the Bank. The task team recommended that the manual be distributed to al l the financial staff as soon as possible.

Accounting Policies and Procedures The administration, accounting and reporting o f the project will be set up in accordance with the fol lowing regulationdcirculars issued by MOF:

a) In line with other Bank financed projects in China, the project will use the "Temporary Regulations o n Financial and Accounting Management for Projects Financed by the Wor ld Bank" (Circular #127 issued in 1993) by MOF as a basis for bookkeeping and preparation o f project financial statements and management reports. Accrual accounting and double entry bookkeeping basis will be adopted by the Project.

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b) Circular 12: "Regulation for the Submission o f Withdrawal Applications" issued in December 1996 by MOF - includes detailed procedures for preparing and submitting withdrawal applications and retention o f supporting documentation.

c) Circular #13: "Accounting Regulations for Wor ld Bank Financed Projects" issued in January 2000 by MOF. The circular provides in-depth instructions o f accounting treatment o f project activities and covers the following: (i) Chart o f account; (ii) Detailed accounting instructions for each project account; (iii) Standard set o f project financial statements; and (iv) Instructions o n the preparation o f project financial statements.

The standard set o f project financial statements mentioned above has been agreed to between the Bank and MOF and applies to al l Bank projects appraised after July 1, 1998 and includes the following: (i) Balance sheet; (ii) Statement o f source and use o f fund; (iii) Statement o f implementation o f loan agreement; and (iv) Statement o f special account.

Bo th circular #127 and #13 are simplified versions o f the Accounting Standards for State-owned, Infrastructure Oriented Projects (the "Standards"), taking into consideration unique characteristics o f Bank projects. The Standards are modeled after the principles o f Intemational Accounting Standards and provides detailed guidelines appropriate to accounting for activities o f Bank projects.

WUCUFIPMO will be managing, monitoring and maintaining project accounting records. Original supporting documents for project activities will also be retained by WUCUFIPMO. In addition, WUCUFIPMO will prepare its financial statements, including statements o f the special account to be prepared by HPFB, and send them to the Bank for review and comment o n a regular basis.

internal Audit There will be n o intemal audit department or arrangement in the WUCUFIPMO. However, HPFB and WMFB will serve a similar function through regular checking. The Bank task team will also conduct regular supervision missions throughout the l i fe o f the project.

Reporting and Monitoring and Format of Financial Statements The format and content o f the fol lowing project financial statements represent the standard project reporting package agreed to between the Bank and MOF. They have been discussed and agreed with al l parties concemed. The project consolidated financial statements wil l be submitted as part o f the Financial Monitor ing Report to the Bank o n a semi-annual basis (prior to August 15 and February 15 o f the subsequent year) and include the following four statements: (i) Balance Sheet; (ii) Summary o f Sources and Uses o f Funds by Project Component; (iii) Statement o f Implementation o f Loan Agreement; and (iv) Statement o f Special Account.

information Systems The accounting s o h a r e "Yongyoull, the most popular accounting software in China, has been selected by WUCUFIPMO for project financial management. This choice i s acceptable to the Bank.

Supervision Plan During the init ial implementation phase, frequent FM supervision missions (twice a year) should be carried out to have better coverage and to ensure that procurement guidelines are followed and expenditures incurred are eligible and wel l supported. More detailed reviews at the initial implementation phase can also help ensure that financial management system i s properly set up and financial statements are prepared in line with stipulated format and content. The FM mission

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frequency can subsequently be reduced from mid point to the normal level (once a year). In order to maximize effectiveness and efficiency, procurement and FMDisbursement specialists should jo int ly participate in supervision missions for procurement and SOEs reviews.

2. Audit Arrangements The Bank requires that project financial statements be audited in accordance with standards acceptable to the Bank. In line with other Bank financed projects in China, the project will be audited in accordance with the Government Auditing Standards o f the People's Republic o f China (1997 edition). The Hubei Provincial Audit Bureau (HPAB) has been identified as the auditor for the project. Audit f ieldwork will be carried out by Wuhan Municipal Audit Bureau (WMAB), further reviewed by HPAB, and the final audit report issued in the name o f H P A B under the guidance and supervision o f the China National Audit Office (CNAO). The Bank currently accepts audit reports issued by C N A O (or i t s local counterpart) for which C N A O i s ultimately responsible.

Audit reports o n annual project consolidated financial statements will be due to the Bank within 6 months o f the end o f each calendar year, with a separate opinion o n Statement o f Expenditures and Special Account. The Bank requires that project financial statements be audited in accordance with standards acceptable to the Bank. In line with other Bank financed projects in China, the project will be audited in accordance with the Government Auditing Standards o f the People's Republic o f China (1997 edition). The Hubei Provincial Audit Bureau (HPAB) has been identified as the auditor for the project. Audit f ieldwork will be carried out by Wuhan Municipal Audit Bureau (WMAB), hrther reviewed by HPAB, and the final audit report issued in the name o f H P A B under the guidance and supervision o f the China National Audit Office (CNAO). The Bank currently accepts audit reports issued by C N A O (or its local counterpart) for which C N A O i s ultimately responsible.

Audit reports on annual project consolidated financial statements will be due to the Bank within 6 months o f the end o f each calendar year, with a separate opinion o n Statement o f Expenditures and Special Account.

3. Disbursement Arrangements The project disbursement will be based o n the traditional disbursement techniques and will no t use Project Management Report (PMR) based disbursements, in accordance with the agreement between the Bank and MOF. The planned disbursement categories are expected to be as follows: (i) Civil Works; (ii) Goods; (iii) Consultancy Services and Training; and (iv) Unallocated. However, the amount and disbursement percentages are not decided yet. WUCUFIPMO i s expected to provide detailed information o n these aspects before appraisal.

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Allocation of loan proceeds (Table C)

Expenditure Category Civil Works Goods

Consultants' Services and Training

Table C: Allocation of Loan Proceeds

Amount in US$million Financing Percentage 157.40 52% 28.20 100% o f foreign expenditures, 100% o f

local expenditures (ex-factory cost) and 75% o f local expenditures for other items

procured locally 6.60 91%

Financing Interest during construction

Front-end fee

Unallocated I 5.80 I

0.00 2.00

Total Project Costs with Bank I 198.00 I

WUCUFIPMO WMFB HPBF World Bank

Total I 200.00 I

Use of statements of expenditures (SOEs):

Disbursement methods, such as replenishment, direct payment and special commitment, will be available for the project. The SOE limits wi l l be set up in line with procurement post-review threshold as follows: (i) all contract for goods estimated to cost less than the equivalent o f $400,000; (ii) all contract for civil works estimated to cost less than the equivalent o f $4,000,000 (iii) consultant contract estimated to cost less than $200,000 for f i r m s and less than $50,000 for individuals.

Special account: One Special Account (SA) will be set up in and managed by HPFB for the project. HPFB will be directly responsible for the management, monitoring, maintenance and reconciliation o f the SA activities o f the project. Supporting documents required for Bank disbursements will be prepared and submitted by WUCUFIPMO to WMFB and onto LPFB for verification, consolidation and approval. HPFB will be responsible for sending withdrawal applications to the Bank for disbursement processing. The SA authorized allocation i s set at $12,000,000, corresponding (on average) to about four months expenditures o f the project. The flow o f withdrawal application i s as follows:

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Annex 7: Project Processing Schedule CHINA: Wuhan Urban Transport Project

~~~~ ~

Negotiations 05/12/2003 Planned Date of Effectiveness

ITime taken to prepare the project (months) 1 I I IFirst Bank mission (identification) I 0711 0/2000 I 07/10/2000 I IAppraisal mission departure I 03/24/2003 I I

Prepared by: Wuhan Municipal Government

Project Executive Office

Preparation assistance: Japanese PHRD Grant

Bank staff who worked on the proiect included: . . Name

Edward Dotson, EASTR ZongYan, WBOB Shomik Mehndiratta, EASTR Richard Scurfield, TUDTR Maria Luisa Juico, EASTR Dong Wenyan, WBOB Daniel Gibson, WBOB Ani1 Somani, EASES Yang Dawei, WBOB Sun Chongwu, WBOB Liu Zhefu, WBOB Li Ninghui, WBOB Liu Zhi, SASE1 Karin Noordlander Gladys Frame Gordon Neilson Rod Stickland

Speciality Task Team Leadermrban Transport Urban Transport Urban Transport Former Task Leader, Sector Leader, Transport Program Assistant Program Assistant Social Scientist Environment Procurement Environment Social Development Financial Management Transport Economics Lawyer Traffic Management Public Transport Transport Planning

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Annex 8: Documents in the Project File* CHINA: Wuhan Urban Transport Project

A. Project Implementation Plan Project Implementation Plan: The first Chinese version was drafted in December, 2002. The final English and Chinese versions wil l be completed by the Appraisal (End of March, 2003)

B. Bank Staff Assessments Aide-Memoires from the following Bank missions: March 2001, July 2001 Identification Mission, October 2001, January 2002, March 2002, June 2002, September 2002, October 2002, December 2002 Pre-Appraisal Mission, February 2003, March 2003 Appraisal Mission.

C. Other

1. Documents for assessment:

Environmental Impact Assessment Report * Resettlement Action Plan * Procurement Assessment Report Financial Management Report

February 2003 November 2002 March 2003 March 2003

2. Project Preparation Documents in both Chinese and English:

Wuhan transport forecasting model (2001.7, 2002.6,2002.11) Wuhan Urban Transport Strategy Study (2001.7,2002.6, 2002.1 1) Feasibility study for road infrastructure component (2001.7,2002.6, 2002.11) Feasibility study for traffic management development (2001.7,2002.6,2002.11) Feasibility study for public transport project component (2001.7) Feasibility study for road maintenance component (2001.7,2002.6,2002.11) Wuhan urban transport project preparation plan (2001.7) Wuhan municipal finance and counterpart funding in Chinese only (2002.3,2002.11) First year civil work preliminary design under the infrastructure component (2002.6) Project preparation plan - in Chinese only (2002.1 1)

*Including electronic files

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Annex 9: Statement of Loans and Credits CHINA: Wuhan Urban Transport Project

03-Feb-2004 Difference between expected

and actual disbursements' Original Amount in US$ Millions

Project ID FY Purpose IBRD IDA GEF Cancel. Undisb. Orig Frm Rev'd PO65463 2004 CN - Jiangxi Integrated Agric. Modern. 100.00 0.00 0.00

PO65035 PO66955 PO73002 PO77615 PO67337 PO40599 PO58847 PO68058 PO76714 PO70441 PO70191 PO64729 PO58846 PO71147 P 0 6 0 0 2 9 PO70459 P 0 6 8 0 4 9 P 0 5 8 8 4 5 PO56199 PO56516 PO56596 PO47345 PO51859 PO45915 PO45910 PO49436 PO56424 PO45264 PO42109 PO58844 PO58843 PO64924 PO64730 PO50036 PO51705 PO51856 PO41268 PO57352 PO58308 PO56216 PO60270 PO38121 PO51888 PO49665 PO46051 PO43933 P 0 4 2 2 9 9 PO41890 P 0 3 6 9 5 3 PO03653 PO46829 PO46564

2004 CN-Gansu 8 Xinjiang Pastoral Development 2004 CN-Zhejiang Urban Envmt 2004 CN-Basic Education in Western Areas 2004 CN-GEF-Gansu 8 Xinjiang Pastoral Develop 2003 CN-2nd GEF Energy Conservation 2003 CN-TIANJIN URB DEV II 2003 CN-3rd Xinjiang Hwy Project 2003 CN-Yixing Pumped Storage Project 2003 CN-Anhui Hwy 2 2003 CN-Hubei Xiaogan Xiangfan Hwy 2003 CN-SHANGHAI URB ENVMT APLI 2002 CN-SUSTAINABLE FORESTRY DEV. PROJECT 2002 CN-Natl Railway Project 2002 CN-Tuberculosis Control Project 2002 CN-Sustain. Forestry Dev(Natura1 Forest) 2002 CN-Inner Mongolia Hwy Project 2002 CN-Hubei Hydropower Dev in Poor Areas 2001 Jiangxi II Hwy 2001 CN-3rd Inland Waterways 2001 CN ~ WATER CONSERVATION 2001 CN-Shijiazhuang Urban Transport 2001 CN-HUAi RIVER POLLUTION CONTROL 2001 CN-LIAO RIVER BASIN 2001 CN-Urumqi Urban Transport 2000 CN-HEBEI URBAN ENVIRONMENT 2000 CN-CHONGQING URBAN ENVMT 2000 TONGBAI PUMPED STORA 2000 CN-SMALLHLDR CATTLE DEV 2000 CN-BEIJING ENVIRONMENT iI 2000 3rd Henan Prov Hwy 2000 Guangxi Highway 2000 CH-GEF-BEIJING ENVMT iI 2000 CN - Yangtze Dike Strengthening Project 1999 Anhui Provincial Hwy 1999 Fujian Ii Highway 1999 ACCOUNTING REFORM 8 DEVELOPMENT 1999 CN-Nat HwyUHubei-Hunan 1999 CN-RURAL WATER IV 1999 CN-PENSION REFORM PJT 1999 CN - LOESS PLATEAU II 1999 CN-ENTERPRISE REFORM LN 1999 CN-GEF-RENEWABLE ENERGY DEVELOPMENT 1999 CN - GUANZHONG IRRiGATiON 1999 CN-ANNING VALLEY AG.DEV 1999 CN-HIGHER EDUC. REFORM 1999 CN-SICHUAN URBAN ENVMT 1999 TEC COOP CREDIT IV 1999 CN-Liaoning Urban Transport 1999 CN-HEALTH IX 1999 CN-Container Transport 1999 RENEWABLE ENERGY DEVELOPMENT 1999 CN - Gansu 8 Inner Mongolia Poverty Red.

66.27 133.00 100.00

0.00 0.00

150.00 150.00 145.00 250.00 250.00 200.00

93.90 160.00 104.00

0.00 100.00 105.00 200.00 100.00 74.00

100.00 105.50 100.00 100.00 150.00 200.00 320.00 93.50

349.00 150.00 200.00

0.00 210.00 200.00 200.00 27.40

350.00 16.00 0.00

100.00 0.00 0.00

80.00 90.00 20.00

150.00 10.00

150.00 10.00 71 .OO

100.00 60.00

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0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 5.60 0.00

30.00 5.00

50.00 5.00 0.00

20.00 30.00 50.00 2.00

35.00 0.00

50.00 0.00 0.00

100.00

0.00 0.00 0.00

10.50 26.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

16.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

25.00 0.00 0.00

25.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

35.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 3.70

100.00 0.00 0.00 0.00 0.00 0.00 0.00 9.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

18.61 0.00

13.30

100.00 65.61

133.00 100.00

10.50 15.00

150.00 106.13 140.95 250.00 178.66 200.00

80.48 37.23 92.67 17.68 88.82 87.89

133.42 84.12 41.42 88.58 90.68 80.23 52.54

123.53 161.67 164.64 14.62

294.22 67.17

105.76 26.26

114.03 43.79 65.86 19.24 59.72 21.84

1.77 29.24 2.71

28.58 38.1 1 21.33

5.70 93.14 36.14 36.96 37.49 3.62

12.87 49.81

0.75 3.88 0.00 0.00 0.70

15.98 0.00 6.55 1.47

13.42 -3.01 0.00 3.65

-2.35 .11.33

2.60 5.15

10.72 5.08 7.62 8.46

53.81 -14.82 35.23 46.04 48.03 64.70 97.81

8.34 183.70 29.51 46.76 18.43 94.03 40.39 62.53 19.16 34.72 15.42 1.75

31.38 4.29

26.50 30.52 11.52 7.31

77.33 -10.18 36.96 22.26 22.19 99.87 38.19

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2.20 0.00 0.00 0.00 0.00 0.00 7.68 0.00 0.00 4.07 7.57 0.00 0.00 0.00

23.93 0.00 0.00 0.00 0.66 6.07

-3.54

Difference between expected and actual

disbursements' Original Amount in US$ Millions

Project ID FY Purpose IBRD IDA GEF Cancel. Undisb. Orig Frm Rev'd PO03614 PO03606 PO35698 P 0 4 9 7 0 0 PO37859 PO03619 PO40185 PO03566 P 0 4 6 5 6 3 P 0 4 5 7 8 8 PO03539 PO51736 PO46952 P 0 3 6 9 4 9 PO36414 PO03637 PO03590 PO35693 PO03654 PO03650 PO38988 PO44485 PO36405 PO03602 PO03599 PO40513 PO03594 PO03589 PO34618 P 0 0 3 6 4 8 PO03571 PO03639 PO03647 PO03603 P 0 0 3 5 9 6 PO03540 PO03632

1998 CN-Guangzhou City Transport 1998 ENERGY CONSERVATION 1998 HUNAN POWER DEVELOP. 1998 CN- IAIL-2 1998 CN-GEF Energy Conservation 1998 CN-2nd Inland Waterways 1998 CN-SHANDONG ENVIRONMENT 1998 CN-BASIC HEALTH (HLTH8) 1998 CN - TARIM BASIN II 1998 Tri-Provincial Hwy 1998 CN . SUSTAINABLE COASTAL RESOURCES DE 1998 E. CHINNJIANGSU PWR 1998 CN . FOREST. DEV. POOR AR 1998 CN-Nat Hwy3-Hubei 1998 CN-GUANGXI URBAN ENVMT 1997 CN-NATL RURAL WATER 3 1997 CN - QlNBA MOUNTAINS POVERTY REDUCTIO 1997 FUEL EFFICIENT IND. 1997 Nat HwyZiHunan-Guangdong 1997 TUOKETUO POWERilNNER 1997 CN - HEILONGJIANG ADP 1997 SHANGHAI WAIGAOQIAO 1997 CN ~ WANJlAZHAl WATER TRA 1996 CN-HUBEI URBAN ENVIRONMENT 1996 CN-YUNNAN ENVMT 1996 2nd Henan Prov Hwy 1996 CN . GANSU HEXI CORRIDOR 1996 CN-DISEASE PREVENTION (HLTH7) 1996 CN-LABOR MARKET DEV. 1996 CN-SHANGHAI SEWERAGE II 1995 CN-7th Railways 1995 CN-SOUTHWEST POVERTY REDUCTION PROJE 1995 China Economic Law Reform -LEGEA 1995 CN-ENT HOUSING 8 SSR 1995 CN-Yangtze Basin Water Resources Project 1994 CN-LOESS PLATEAU 1993 CN-ENVIRONMENT TECH ASS

200.00 63.00

300.00 300.00

0.00 123.00 95.00 0.00

90.00 230.00 100.00 250.00 100.00 250.00 72.00

0.00 30.00 0.00

400.00 400.00 120.00 400.00 400.00 125.00 125.00 210.00

60.00 0.00

10.00 250.00 400.00 47.50

0.00 275.00 100.00

0.00 0.00

0.00 0.00 0.00 22.00 0.00 0.00 0.00 0.00 0.00 22.00 0.00 0.00 0.00 0.00

85.00 0.00 60.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00

100.00 0.00 0.00 0.00

20.00 0.00 70.00 0.00

150.00 0.00 0.00 32.80 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

25.00 0.00 25.00 0.00 0.00 0.00

90.00 0.00 100.00 0.00 20.00 0.00

0.00 0.00 0.00 0.00

200.00 0.00 10.00 0.00 75.00 0.00

110.00 0.00 150.00 0.00 50.00 0.00

20.00 0.00

145.00 0.00 0.00

17.00 1.40 0.00 2.67 0.00 2.06

86.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

102.50 0.00 0.00

75.00 28.32 19.48 19.00 0.00 0.00 0.00 0.00

119.00 0.01 0.00

57.46 1.92 0.00 0.00

100.31 36.22 31.45

4.52 0.44

39.18 20.07 39.66 14.78 19.81 47.54 51.14 40.02 21.15 71.56 0.00

13.16 7.62

48.52 37.37 7.85

85.1 1 22.58 39.72 40.68 16.69 73.92

3.08 5.60

39.94 13.10 1.21 0.61

38.95 0.34 1.12 1.11

120.31 18.22

172.70 4.52

22.06 54.12 21.47 23.29 16.58 15.98 45.44

137.14 -61.48 21.15 65.25

3.20 16.34 32.81 48.52

139.87 7.85

55.33 97.58 70.08 61.92 35.69 58.83 12.18 7.77

39.94 132.10 25.36

0.93 94.26 4.75 0.50 1.73

100.31 0.00

-22.46 0.60 0.00 4.29

-0.79 0.00 0.00 0.00

33.72 11.55 17.91 0.00

23.72 2.78

-3.28 0.00

16.70 25.18

3.84 39.65

5.00 29.74

8.06 22.69

0.00 0.00 0.00

-0.19 23.10 25.36 0.00 1.23 4.75 0.00 1.41

Total: 11719 07 1722 60 21430 842.02 5141 55 2977.32 42352

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CHINA STATEMENT OF IFC's

Held and Disbursed Portfolio June 30 - 2003

In Mil l ions US Dollars

Committed Disbursed IFC IFC

FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi Partic 2001 0 2000 1998 1999 1999 1993

2002 2001 1995197 1998 2000 1996 2003 1993 0 2003 2002103 2003 1999100102 2002 1998100 2003 1998 1998 1987192194 1994 1994 1994 1995 1994 2003 1999 2002 2002 1998 2001 2001 2001 1996 2001 1995 1997198 2003

Peak Pacific Rabobank SHFC SSIF Shanghai Krupp Shanghai Midway Shanxi Shenzhen PCCP Sino Gold Sino-Forest Suzhou PVC WIT Wanjie Hospital Weihai Weidongri XACB Yantai Cement Zhen Jing Zhengye- ADC Advantage BCIB Bank o f Shanghai CDH China Fund CIG Holdings PLC CSMC Chengdu Huarong Chengxin-IBCA China Bicycles China Walden Mgt China Walden Ven Dalian Glass Dupont Suzhou Dynamic Fund Great Infotech Hansom Huarong AMC IEC Leshan Scana Maanshan Carbon Minsheng Bank NCCB Nanjing Kumho New China Li fe Newbridge Inv. Orient Finance PSAM

0.00 0.45 0.00

28.92 0.00

16.75 3.76 0.00

25.00 0.00 5.00

15.00 1.03 0.00 6.33 0.00

15.00 0.00 0.00 0.00 0.00 0.00 0.00 6.73 0.00 0.00 0.00 0.00 0.00 9.35 0.00 0.00 0.00

23.74 20.00

5.36 9.00 0.00 0.00 3.89 0.00 0.00 0.00 0.00

0.00 0.00 6.00 0.00

16.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

19.93 1.95 0.00 0.00 0.50 0.00

24.67 16.36 3.00

12.00 3.20 0.36 0.00 0.01 0.00 2.40 4.15 8.76 3.50 0.08 3.00 0.00 1.35 2.00

23.50 26.58

3.81 30.70

1.95 0.00 1.93

25.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

11.60 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.45 0.00

65.63 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 7.82 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

11.07 0.00 0.00 0.00 0.00

0.00 0.45 0.00

28.92 0.00

14.20 3.76 0.00

20.00 0.00 0.00

15.00 1.03 0.00 6.33 0.00 2.00 0.00 0.00 0.00 0.00 0.00 0.00 6.73 0.00 0.00 0.00 0.00 0.00 9.35 0.00 0.00 0.00

14.74 0.00 3.76 9.00 0.00 0.00 3.89 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.45 0.89 0.00 0.00 0.00 0.00 65.63

16.02 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 1.95 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.50 0.00 0.00 0.00 0.00 0.00

24.67 0.00 0.00 2.38 0.00 0.00 3.00 0.00 0.00 7.20 0.00 0.00 3.20 0.00 7.82 0.36 0.00 0.00 0.00 0.00 0.00 0.01 0.00 0.00 0.00 0.00 0.00 2.40 0.00 0.00 4.15 0.00 0.00 7.10 0.00 0.00 2.10 0.00 0.00 0.08 0.00 0.00 0.01 0.00 0.00 0.00 0.00 0.00 1.35 0.00 0.00 2.00 0.00 0.00

23.50 0.00 0.00 26.46 0.00 0.00

3.81 0.00 11.07 23.32 0.00 0.00

1.95 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Total Portfolio: 195.31 217.74 36.60 84.97 139.16 158.44 0.00 84.97

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Approvals Pending Commitment '

FY Approval Company Loan Equity Quasi Partic 2002 ASIMCO 0.00 0.01 0.00 0.00 2003 Anjia 0.00 0.00 0.01 0.00 2004 CCB-MS NPL 0.03 0.00 0.00 0.00 2004 CUNA RCCI 0.00 0.00 0.01 0.00 2003 Cellon 0.00 0.00 0.01 0.00 2002 Darong 0.01 0.00 0.00 0.01 2002 Huarong AMC 0.02 0.00 0.00 0.00 2002 IEC 0.00 0.01 0.00 0.00 2002 KHIT 0.00 0.00 0.00 0.00 2003 Peak Pacific 2 0.00 0.00 0.01 0.00 2003 SAIC 0.01 0.00 0.00 0.00 2002 SML 0.00 0.00 0.00 0.00 2002 Sino Mining 0.01 0.00 0.00 0.01 2002 Zhong Chen 0.03 0.00 0.00 0.03

Total Pending Commitment: 0.10 0.02 0.05 0.05

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Annex I O : Country at a Glance CHINA: Wuhan Urban Transport Project

145 13.1 134 13.5

POVERTY and SOCIAL

2002 Population, mid-year (millions) GNi per capita (Atlas method, US$) GNi (Atias method, US$ billions)

Average annual growth, 1996-02 Population (%) Labor force I%) Most recent estimate (latest year available, 1996-02) Poverty (% of population below national poverty line) Urban population (% of total population) Life expectancy at birth (years) Infant mortality (per 1,000 live births) Child malnutrition (% ofchildren under 5) Access to an improved water source (% ofpopulation) Illiteracy (% ofpopulation age 15+) Gross primary enrollment (% of school-age population)

Male Female

KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1982

GDP (US$ billions) 221.5 Gross domestic investmentiGDP 33.2 Exports of goods and serviceslGDP 8.9 Gross domestic savingslGDP 34.8 Gross national savingslGDP 35.1

GDI +GDP I*** n..jl&

Current account baiancelGDP interest paymentslGDP Total debffGDP Total debt servicelexports Present value of debffGDP Present value of debtiexports

2.4 0.2 3.8 8.0

1982.92 1992-02 (average annual growth) GDP 9.7 9.0 GDP Der caDita 8.1 8.0

China

1,281 .O 950

1,219.1

0.8 0.9

5 38 71 30 10 75 14

106 105 108

1992

454.6 36.2 19.5 37.7 38.0

1.9 0.6

15.9 8.6

2001

7.5 6.7

East Asia B Pacific

1,838 950

1,740

1 .o 1.2

38 69 33 15 76 13

106 105 106

2001

1,167.1 38.5 25.5 40.9 40.0

1.5 0.5

14.6 7.7

14.1 51.8

2002

8.0

Lower- middle- income

2,411 1,390 3,352

1.0 1.2

49 69 30 11 81 13

111 111 110

2002

1,232.7 41 .O 29.5 44.0 43.8

2.9 0.5

12.6 6.1

2002-06

7.5 7.2 6.6

Development diamond*

Life expectancy

T

Gross primary

enrollment

GNI

capita per

.L

Access to improved water source

A 3r**i China Lower-middle-income group

Economic ratios"

Trade

T Domestic ~~ ??

I investment savings

1.

indebtedness

* *--China ___ __ Lower-middlemcome group I

STRUCTURE of the ECONOMY

(% of GDP) Agriculture Industry

Services

Private consumption General government consumption Imports of goods and services

Manufacturing

158 145 333 21.8 50.1 51 7 450 439 342 445 373 33 1

21 7 343 341 337

2o l5

lo

50.7 49.2 45.7 42.5 1 " 97 98 i 9 00 a1 d2 I

1982.92 1992-02 2o01 (average annual growfhj Agriculture 4 6 3.7 2 8 Industry 11 6 11.3 8 4

Manufacturing 112 104 9 0 8 1 Services 117 8 4 8 4 7 3

Private consumption 11 4 8 1 2 8 1 9 General government consumption 9 9 8 4 10.5 Gross domestic investment imports of goods and services

9.5 9.7 13.9 14.9 e* * L X Exports +Imports 9.7 128 10.8 27 5 I

- 86 -

China PRICES and GOVERNMENT FINANCE

Domestic prices (% change) Consumer prices Implicit GDP deflator

Government finance (% of GDP, includes current grants) Current revenue Current budget balance Overall surplusldeficit

1982 1992 2001 2002 Inflation (“A) c ’OK 5t

6.0 6.4 -0.2 7.9

0.7 -0.8 1.2 -2.6

1 0 4 -

I 22.9 14.7 .I 2.0

-0.3 -1.0

17.1 17.9 1.1 0.0

-4.7 -3.0 1 y*- 1 GDP deflator - 0 I C P I I

TRADE

(US$ millions) Total exports (fob)

Food Fuel Manufactures

Total imports (cif) Food Fuel and energy Capital goods

Export price index (1995-100) Import price index (1995=100) Terms of trade (1995=100)

BALANCE of PAYMENTS

(US$ millions) Exports of goods and services imports of goods and services Resource balance

Net income Net current transfers

Current account balance

Financing items (net) Changes in net reserves

Memo: Reserves including gold (US$ millions) Conversion rate (DEC, iocal/US$)

EXTERNAL DEBT and RESOURCE FLOWS

(US$ millions) Total debt outstanding and disbursed

IBRD IDA

Total debt service IBRD i DA

Official grants Official creditors Private creditors Foreign direct investment Portfoiio equity

World Bank program Commitments Disbursements Principal repayments Net flows Interest payments Net transfers

Composition of net resource flows

1982 1992

22,321 84,940 2,908 8,309 5,314 4,693

12,271 67,936 19,285 80,585 4,201 3,146

183 3,570 3,204 31,312

41 85 71 95 58 89

2001 2002

266,155 325,565 12,780 14,623 8,420 8,372

239,802 297,085 243,610 295,203

4,980 5,237 17,495 19,285

107,040 137,030

83 78 91 86 91 90

Export and import levels (US$ mill.) I 400’000 T 300 000

200 000

100 000

0

i 96 97 98 99 00 01

0 Exports Imports

1982 1992

24,906 94,198 20,555 86,752 4,350 7,446

376 249 486 1,155

5,212 8,850

-995 -10,952 -4,217 2,102

2001 2002

299,409 365,395 271,325 328,013 28,084 37,383

-19,174 -14,945 8,492 12,984

17,401 35,422

30,046 40,085 -47.447 -75,507

Current account balance to GDP (X)

5 T

I 96 97 98 99 00 01 02

.. 24,842 2.4 5.9

220,051 297,721 8.3 8.3

1982 1992

8,358 72,428 0 3,752 1 4,287

2,125 8,618 0 460 0 30

2001 2002

170,110 155,678 11,550 12,051 8,654 8,729

24,297 23,688 1,550 1,631

151 175

Composition of 2002 debt (US$ mill.)

A 12,051 729 G 43, 6,987

E 21,888 47 327

657 2,343

430 11,156 0 1,243

-122 8,949

240 2,156 -839

4,017 -13,593 44,241 49,308

3,015 2,286

\ / u F: 62.103

330 1,865 1 1,331 0 197 1 1,134 0 293 1 841

782 563 1,791 1,733

904 1,157 887 576 797 649 90 -73

4 - IBRD B . IDA D - Other multilateral F - Private Z - IMF

E - Bilateral

G - Short-term

vevelopmenr--trlzvlvj

- 87 -

Additional Annex 11 : Environmental Assessment and Environmental Management Plan Summary

CHINA: Wuhan Urban Transport Project

1. Background

The Environmental Assessment (EA) report was conducted for the project based on relevant regulations and guidelines o f the Chinese government and the Wor ld Bank. The objective was to identify at an early stage the potential environmental consequences o f the project, propose measures to avoid, mitigate or otherwise compensate negative environmental impacts during construction and operation, and allow incorporation o f appropriate measures in the design to reduce negative impacts to a minimum and acceptable level.

The EA was prepared by No. Four Survey & Design Institute o f China Railways Ministry and Wuhan Research Academy o f Environmental Sciences in accordance with Bank’s OP 4.01. The project i s classified Category A since it involves involuntary resettlement, major road construction, partly on new alignments, and increased air and noise pollution. The Environmental Management Plan (EMP) was prepared by No. Four Survey & Design Institute o f China Railways Ministry. The Wuhan Project Office (PO) provided detail budget estimation o f E M P implementation and on behalf o f Wuhan Government, Wuhan P O endorses full implementation o f the EMP.

2. Project Components

The proposed Wuhan Urban Transport Project consists o f six components: (1) road network development. This component aims to address the most immediate needs o f

improving the operation o f the road network within the city, and expanding the bicycle and pedestrian networks. traffic management and road safety. The a im o f this component i s to build upon the strengths o f the existing transport network management to better utilize existing assets and resources. public transport. The objective o f this component is to facilitate an increase in the efficiency and effectiveness o f bus services in the city. road maintenance. The component aims to increase the adequacy o f road maintenance through increased funding and improvements to the institutional and procurement arrangements for road maintenance. environmental management. The component aims to mitigate the impacts caused by road construction, minimize the vehicle emission, and to increase the positive environmental impacts o f the project. The detailed content includes: establishing a vehicle emission and traffic noise monitoring system, and facilitating implementation o f a motor vehicle emission control strategy. capacity building. This component will strengthen the technical and management ski l ls o f the municipal staff,

(2)

(3)

(4)

(5)

(6)

3. Baseline Environmental Description

Wuhan is located in the middle and lower alluvial plains o f the Changjiang (Yangtze) River. As the capital ci ty o f Hubei Province, Wuhan i s the economic, political, financial and cultural center o f the Province. It has eleven urban and two suburban districts with an urban population o f 4.5 million. Wuhan i s r ich in water resources, and has a network o f rivers and lakes. Changjiang River and Hanjing River f low through

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the c i ty proper. There are lakes around the middle ring road, in the area where the proposed roads are located.

Wuhan gets an annual average sunshine o f 2058 hours, with 46 percent sunshine. Summer heat can be stifling.

The proposed project i s spread over eight urban districts. A detailed survey o f the area revealed that a total o f 126 environment sensitive receptors would be affected by the roads included in the project. These receptors include schools, hospitals, kindergartens and residential buildings along both sides o f the proposed project roads.

3.1 Air quality. Based o n the results provided by Wuhan Environmental Monitoring Station, the existing air quality in Wuhan meets the requirement o f National Class I1 standards in the levels o f Sulphur Dioxide (S02), Ni t r ic Oxide compounds (NOx), and Carbon Monoxide (CO). However, the Total Suspended Particulates (TSP) exceeded the standards, mainly due to coal combustion, construction activities and increase in traffic.

3.2 Noise. Continuous noise monitoring was conducted 2-5 meters away from the existing road shoulders and 1 meter in front o f the sensitive sites to determine the existing noise level along the proposed project roads. The results along typical road sections showed a 100 percent increase in the level o f noise, exceeding the noise standards for day as well as night.

3.3 Vibration. Road vibration caused by traffic i s irregular. The vibration level was observed to increase with traffic volume and speed, assuming road condition and fleet composition remain the same.

3.4 Sunshine to buildings located near the proposed interchanges could be blocked once the multi-layer structures are completed. Of the eleven elevated interchanges, five have no sensitive receptors located within the shaded areas o f the finished structures. There are residential buildings, schools and a kindergarten surrounding the remaining six interchange sites. The baseline sunshine investigation shows that on the winter solstice day, which i s the shortest day o f the year, a l l buildings on the north side will receive 10 hours o f sunshine at the first floor window level.

3.5 Drainage System and Surface Water. Wuhan’s urban areas are divided into twenty-two drainage systems with a total catchment area o f 198 km2. The sewer system in the o ld city area i s primari ly a combined storm and sanitary sewer system, while in the newly developed areas, there are separate sewer systems for storm water and sewage. Project components are proposed in both o ld and newly developed areas.

The latest annual report on environmental quality in Wuhan (2002), indicates that the surface water in virtually a l l water bodies in the ci ty has been contaminated, as shown by the standard compliance status. The main pollutants are organic substances, coliform, nitrogen and phosphorus, indicating that domestic sewage i s the main source o f water contamination.

3.6 Ecosystem. East Lake is listed in the 1998 Asian Wetland Directory. I t i s also a national level scenic site, urban recreation area, popular resort and health rehabilitation area. Based o n a 1986 site ecological study, the latest available report o f i ts kind, there were 76 species o f phytoplankton, 203 species o f zooplankton, and 67 species o f fish found in the lake at the time. The climate and the abundant food sources in the shallow water bodies attract many species o f migrating birds to Wuhan during winter.

- 89 -

However, water pol lut ion and extensive human activities in and around the East Lake, are bringing changes in the biomass, species and aquatic ecosystem o f the area. The level o f biodiversity has decreased in recent years. But the East Lake continues to be an important natural habitat in the Changjiang River area and a rare natural wetland within a large city.

Other components in the urban ecosystem consist mainly o f planted trees, woodland, and green areas throughout the c i ty area including al l project sites. There are about 106 species o f trees in Wuhan.

3.7 Cultural property and religion. A survey o f al l project roads and other project facilities such as bus terminals on both recommended and altemative sites, was conducted during EA preparation. Two provincial level historic sites were identified within the project impacted area: (1) Wuhan Office o f the N e w Fourth Army, which is located at the Lugouqiao Road in the Hankou section; and (2) Xinhai Revolution Gate, located about 150 m f rom a project road - Jinshui Road. The N e w Fourth Army was one o f the most influential army groups in the modem Chinese revolutionary history and their former headquarter currently serves as a memorial and revolutionary museum. Xinhai revolution i s a significant milestone in the Chinese modem history and its success ended the five thousand years o f the feudal society in China and marked the beginning o f the modem Chinese history. The present revolutionary gate was rebuilt in 198 1.

4. Potential Impact & Mitigation Measures

The major potential environmental impacts associated with the proposed project and the mitigation measures are outlined in both the EA Report and in the EMP. The EA Report concluded that the proposed project would address emerging and projected traffic congestion in the ci ty center, improve the quality o f urban l i fe and stimulate economic development, resulting in both social and economic benefits. The report also indicated that there would be both positive and negative impacts o n the environment. The E M P simulates how the environmental protection measures identified in the EA Report wil l be incorporated into the design, and implemented during the design, construction and operation phases o f the project and what institutional arrangements have been made to ensure their effective implementation. T h e key elements o f the E M P are summarized below:

4.1 Design phase. Currently Wuhan has a l imited motor vehicle inspection program, which carries out roadside inspections o f about 10-15 percent o f city's motor vehicle fleets each year. The city government also plans to introduce and enforce Euro3 by 2010 and Euro4 by 2020 in the city. This EA proposes to include the development o f a motor vehicle inspection and maintenance (I/M) program as a major mitigation measure. More specifically, this component may include (1) an assessment o f the legislative and pol icy framework , emissions monitoring and vehicle emissions program (Wuhan already has i ts shortcomings); (2) pol icy suggestions to improve aggregate motor vehicle emissions, and measures to ensure more efficient functioning o f various agencies involved with motor vehicle emission control; (3) a study for development and implementation plan o f an I/M system; (4) procurement o f I/M equipment to upgrade the current inspection capability in accordance with the I/M implementation plan; and (5) other necessary facilities such as buildings for inspection stations and/or laboratoryhest center facilities. In addition, as part o f the overall transport strategy for Wuhan, the project road design will be given full consideration to optimize the transport network.

The analysis o f alternatives was conducted during the EA process in the fol lowing aspects: different road alignments, different design configurations, and with and without project. For instance, comparison o f alignments was undertaken for four roads in two districts by the project and the EA teams. A number o f criteria were considered in the evaluation o f each section including length, road condition, planning width,

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as we l l as technical, socioeconomic, resettlement, implementation and environmental factors and engineering costs. During this process a variety o f potential environmental effects were avoided or minimized.

A number o f features to minimize noise effects have been incorporated into the design. These measures include limiting construction o f elevated viaduct to locations where road widening i s not possible. Construction materials for road surface structure with effective sound absorption will be applied in certain areas to reduce traffic noise. Some residential buildings and sensitive receptors adjacent to the road will be protected with the use o f sound barriers. Double-glazed windows and air conditioners will be utilized at special sensitive receptors, e.g., schools, hospitals, seniors’ homes and kindergartens, affected by the traffic noise. Comprehensive sound insulation will be installed for the housing o f the f i rst r o w o f residential buildings affected by traffic noise, e.g., double-glazed windows in combination with cooling systems.

Structure and materials effective for vibration mitigation will be put into joints between pre-fabricated structures and bridge piers. Application o f flexible supports, such as rubbers and bow l shaped supports for viaduct and interchanges wil l buffer vibration o f structure and reduce noise. Road surface quality also has a direct impact o n vibration. The use o f high quality materials for surface smoothness and regular maintenance and repairs will be required.

East Lake, a national level scenic site and an important part o f Jianghan lake wetland area, wil l be exposed to the construction and operation o f Qinghua Road. Given the l imited time and available information at present, it i s l ikely that the adverse impacts and consequences to the local ecosystem, particularly to the migrating birds and their habitats, have not been evaluated, although the road itself legally complies with relevant c i ty plans and regulations. As Qinghua Road i s not scheduled for construction in year 2006 in the current project implementation plan, the EA recommends further study and impact assessment o f the proposed construction. A further study will al low the Wuhan PO, design team, as we l l as EA team more t ime to explore the feasibility o f a different alignment or other options, which do not traverse the scenic area and the lake. There would be the alternative o f not building Qinghua Road if the network capacity i s proven sufficient to serve this area without Qinghua Road.

A total number o f 2351 trees along roadsides wil l be affected in different degrees by the proposed project. In addition to the implementation o f “planting two trees for every one cut” pol icy and measures for protection o f existing green areas and transplanting trees, trees will be planted as part o f the Environmental Improvement Component o f the project.

4.2 Construction phase. Dust will be generated as a result o f demolition and large-scale excavation. Full-time environmental management staff in the construction team and the contractors will inspect sites and implement dust control measures such as the use o f water or the enclosure o f construction sites. Asphalt plants and concrete-mixing stations will be located in designated areas only to minimize impacts. Vehicles transporting building materials (e.g. cement, earth and stone) will be covered with tarpaulin. At construction sites where dust i s easily created by mixing, loading and unloading o f building materials, effective measures such as watering wil l be taken to prevent or mitigate dust. The rubbish and trash accumulated by workers will be stored in a closed site and disposed o f f regularly.

The use o f noisy machinery, such as percussion hammers, pneumatic dr i l l s and rock drills during the night (1O:OO pm - 6:OO am) will be strictly prohibited. Machinery with l o w noise and noise shielding andor sound absorption materials wil l be used as much as possible, e.g. on-site generator with mufflers or silencer. Contractors will rationalize work timetable, keep noisy operations away from sensitive points, carry out regular maintenance and repairs, and enforce strict implementation o f operation procedures.

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Where sites are seriously affected during construction, temporary enclosure with noise shielding andfor sound absorption will be set up. Stream and diesel pi le drivers are prohibited for use in areas where sensitive receptors are within 50 m o f construction sites. The construction components for viaducts and interchanges will be prefabricated and transported to the construction sites. If on-site monitoring results exceed standards, environmental inspectors or local environmental monitoring unit will report this to the project management office, which will stop the construction for rectification. Contractors must abide by the provisions for construction noise (vibration) prevention and control in Wuhan. I t i s prohibited to use steam and diesel pi le drivers as wel l as monkey driver at the project site. Low-level vibration machinery will be used as much as possible, a system o f regular maintenance and repairs i s to be employed.

Feasible measures for traffic management will be determined prior to construction in consultation with the traffic police. Project supervisors will cooperate to avoid traffic congestion due to construction. The public will be notified in advance. When carrying out construction in front o f schools, the contractor will appoint specific persons to guide the pupils safely through the construction site. Overhead safety shelters will be installed when the construction i s in residential andfor commercial areas. Separate roadside construction will be adopted for road widening in order to provide safety to both pedestrians and vehicles.

4.3 Operational phase. The proposed project will cause degradation o f air quality within 200-300 m o f the alignments, but wil l make a positive contribution to the overall air quality in the urban area, particularly in the ci ty center. An auto monitoring station network for air quality and noise, and a Motor Vehicle Emission Control Strategy have been incorporated into the project. The objective i s to build o n existing initiatives, policies and programs being undertaken in Wuhan, and to develop strategies and provide a strong foundation for a program to address the problem o f increasing air pol lut ion f rom mobile sources. The program will integrate a number o f initiatives including the ban o n leaded fuel; an enhancement o f existing vehicle inspection and maintenance (UM) system; increased use o f alternate fuels; improvement o f laws and regulations related to vehicle emissions and their more rigorous enforcement; accelerated retirement o f older vehicles; further development o f public transit and traffic management and the expansion o f automated monitoring network to monitor air pol lut ion and quality.

5. Environmental monitoring

The E M P identifies requirements related to the environmental inspection and monitoring program. Environmental management staff will be assigned by each contractor to respond to unanticipated environmental concems and will ensure the implementation o f the mitigation measures and compliance with established standards (e.g., noise and dust). Environmental monitoring will be contracted with Wuhan Environmental Monitoring Center (needs to be confirmed) during both the construction and operational phases to ensure the effectiveness o f mitigation measures and to determine the accuracy o f impact predictions. Parameters to be monitored include air quality, dust, noise and vibration.

The project includes an environmental training component for contractors and inspectors. The staffing and training i s presented in the EMP.

6. Public Consultation and participation

Three rounds o f public consultation have been conducted during the EA process: the first round at the preparation o f EA terms o f reference (TOR) between September 4-7,2002; the second round at draft EA report between December 26-29,2002, and the third round at review stage o f draft EA reports between March 26 and April 10,2003. A variety o f techniques were utilized in public consultation including: site visits; public opinion surveys (e.g., distribution o f questionnaires, letters, interviews); experts consultation;

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public meetings at neighborhood committees in the project areas; stakeholders meetings and interviews with project affected groups, organizations and individuals. The distribution o f pamphlets gave an overview o f the project and indicated the availability o f the draft EA Outline & Summary, for review; and the announcement o f the second public meeting. Advertisements were also provided in local newspapers.

Stage

In Round three o f public consultation, over 500 people attended public and stakeholders meetings. A total o f 4200 copies o f the public questionnaire were distributed in the three rounds o f public consultation and 4059 copies o f completed questionnaires returned. The public expressed their support to the project in general and also their concerns and suggestions on specific environmental issues including noise (construction and traffic), air borne dust, air emission from motor vehicle, traffic planning, landscaping, etc.

Fo rm

The EA team has responded to the public concerns and suggestions by incorporating the following: a series o f dust control measures during construction; noise insulation and double-glazed windows at sensitive receptors, which are expected to experience significant incremental increase in noise levels after the project; and a large scale landscaping program with more new trees planted than those cut during the project, etc.

Public consultation activities and information disclosure for this project i s summarized in fol lowing tables:

By whom and for whom

By P M O & EA team for local

people's representative

and Youth

Time

Sept 4,2002 round meeting

Volunteers By P M O & EA Public meeting

Public opinion survey

Sept 6-7,2003

Draft EA report Public meeting I

iffected residents By P M O & EA

survey

Sept 13-20,200:

review meeting

team for randomly selected

individuals in the project area

By P M O & EA team for project iffected residents

By P M O & EA team for

randomly selected

individuals By P M O & EA eam for agencies

Dec 28,2002

Dec 26,2002 to Jan 3,2003

March 17,2003

team for project I

Location

Conference room, Wuhan

Municipal Design Institute

Changqing, Qingshan Park, and Beibuting Project road

areas

xuping Department

Store; Xibeihu Plaza

Project road areas

East Lake Scenery Site

WB Policy

OP 4.01

OP 4.01

OP 4.01

OP 4.01

OP 4.01

OP 4.01

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Public opinion survey

md organizations related to East

Lake management

By PMO & EA team for randomly selected

individual o f proiect areas

March 28 to April 6,2003

Management Commission

Office

Information Notice to the public about

the public meetings, locations, and contents

Project summary and key EA information

Project road areas

Date LocatiodMedia WE3 policy Sept 5,2002 Wuhan Evening News, OP 4.01; Sept 5,2002 Changjiang Daily Policy on Disclosure o f

Sept 9,2002 Wuhan Communications Information

I 1

Radio

OP 4.01

Notice to the public on second round o f public consultation including locations and contents Advertisement on draft

,EA report Draft EA report and EMP

Final EA report and EMP

Dec 28,2002 Wuhan TV stations Dec 29,2002 Wuhan Evening News

I1

Feb 19,2003 Wuhan Evening News

Wuhan public library No. 4 Railway Design

Institute Wuhan Academy o f

Environmental Sciences

No. 4 Railway Design Institute

Wuhan Academy o f Environmental Sciences

I1

Since Feb 18,2003 I 1

From March 30, 2003 Wuhan public library I1

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Additional Annex 12: Resettlement Impacts and Resettlement Action Plan Summary CHINA: Wuhan Urban Transport Project

Introduction

This annex reviews the adverse impacts o f land acquisition and structural demolition engendered by the Wuhan Urban Transport Project, and the arrangements proposed in the Resettlement Act ion Plan (RAP) to mitigate them. Consistent with Wor ld Bank Policy OP 4.12 o n Involuntary Resettlement, the objectives o f resettlement planning are to avoid or minimize adverse impacts, and to ensure that incomes and living standards are improved (or at least restored) for al l persons displaced by the project. Special care has been taken in resettlement planning to ensure that relocation or rehabilitation measures are sufficient in areas where low-income families are particularly prevalent.

Bo th the road network improvement component and the public transport component o f the project are l ikely to involve land acquisition and resettlement. The RAP includes detailed coverage regarding the road network improvement component, based on census and survey data collected specifically for project purposes. Because the precise nature o f impacts associated with the public transport component will not be known until the final designs are prepared during the implementation phase o f the project, the R A P includes only preliminary estimates o f expected adverse impacts, which are expected to be relatively minor. The Wuhan Municipal Government will prepare a separate resettlement implementation plan, consistent with the principles and standards established in the project RAP, for Bank review and acceptance at least six months before the commencement o f c iv i l works in the transport component.

Structure Demolition and Resettlement-Related Impacts

Based on project designs, a total o f 28,756 persons would be affected, to varying degrees, by land acquisition or structural demolition. The road network improvement component includes activities scattered throughout both urban and suburban areas o f Wuhan. In urban areas, resettlement activities will involve 62 residential neighborhood committees; in suburban areas, 48 villages will be affected by loss of land or structural demolition. Additionally, 273 shops, enterprises, or public institutions would be affected. The total number o f persons required to relocate their residence would be 9,072 (2,478 households). A total o f 19,693 employees may be temporarily affected by transitional closing o f shops or enterprises. No one will lose employment permanently because o f the project.

The road network improvement component will require permanent acquisition o f 176 hectares o f collectively owned land in suburban areas. Of this amount, about 125 hectares are under some form o f cultivation (including approximately 97 hectares o f fishponds). The remainder i s used for rural house plots o r other local purposes, or is unutilized wasteland.

Relatively minor design changes are l ikely to continue until implementation begins. Typically, final designs result in marginal decreases in land acquisition and structural demolition, as we l l as changes in proportion among categories o f affected land and structures.

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Legal and Policy Framework

The legal basis for structural demolition, land acquisition and resettlement planning includes national, provincial and local laws and regulations. Relevant national laws or regulations include the Urban Structure Demolit ion Management Regulation (2001) and the Land Administration L a w (1999).

In China, al l land off icial ly designated as urban land i s owned by the State while village collectives o w n al l cultivated rural land. Hence there are two types o f land acquisition involved in this project. One i s to acquire State-owned land without payment and the second i s to acquire collectively owned rural land with replacement compensation and other forms o f assistance provided to the collectives that stand to lose the land permanently.

When collectively owned farmland i s acquired, the future land user pays compensation for land, loss o f crops and attached properties, and a resettlement subsidy for the rehabilitation o f affected persons. According to the Land Administration L a w (as revised in 1999), the land compensation wil l be 6 to 10 times the average annual output value per mu for the three years before land acquisition. The resettlement subsidy, determined according to the number o f agricultural population to be resettled, i s up to 15 times the average annual output per mu.

Crop compensation and compensation for affected structures or other f ixed assets are paid directly to individuals. The land compensation and resettlement subsidy i s to be paid directly to the village-based collectives losing the land. This compensation i s to be used for .production development, non-farm employment and income-generating activities for the displaced people. With the prior approval o f village members and the county resettlement office, the compensation can also be used for improving community facilities o r services. By law, separate accounts o n resettlement compensation are to be kept at each affected village, with financial reports provided annually to the next higher level o f government.

The State Urban Structure Demolit ion Management Regulation i s more detailed and comprehensive than the land law. Please refer to RAP for detailed information.

Compensation Standards and Rehabilitation Measures

Compensation rates are based o n replacement cost for various categories o f affected assets, such as the actual structure and the zonal valuations reflecting the varying value o f urban land. Land compensation i s based o n the highest average annual output value per mu among the same land in the affected municipal districts. In each case, compensation rates meet or exceed legal requirements, and meet or exceed replacement cost valuation.

The land compensation rates vary in the seven affected municipal districts. The average land compensation rate including resettlement subsidy i s 1,077,780 RMB (about US$7 1,852) per hectare. The average paddy land rate excluding resettlement subsidy i s Yuan 718,520 (about US$87,624) per hectare, which i s ten times the average agricultural output. The amount o f resettlement subsidy for loss o f paddy land i s Yuan 1,077,780 (about US$13 1,436) per hectare, which i s fifteen times the average agricultural output. Compensation rates for each locality are listed in Chapter 7 o f the RAP.

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Nominal compensation rates for residential structures ranges f i om Yuan 290 (about US$35) to Yuan 800 (US$lOO) per square meter. Illegal structures requiring demolition wil l be compensated at full replacement cost for the structure itself, but without supplemental payment for zonal valuation. In many cases, local authorities may increase compensation rates for demolished structures in response to local variations in property valuation or to meet other local contingencies. In al l cases, however, compensation will meet or exceed standards established in the RAP.

The project will also affect public infrastructure. Compensation at replacement cost will be paid to the relevant government agencies or local governments to restore affected infrastructure and services. The replacement cost will be reported to the municipal government for review.

The proposed road improvements wil l pass primari ly through suburban areas. The population densities are comparatively high, with an average o f 0.5 mu (or about .03 hectares) o f land per person. Resettlement planning has included review o f impacts o n incomes in villages that will be affected. Typically, villages contract farmland to farmers yearly and agricultural income generally constitutes less than 10% o f village residents’ income. Crop compensation will be allocated to each individual by cash and villages wil l take the responsibility o f livelihood restoration.

According to the state land law, the calculation o f number o f displaced surplus laborers caused by land acquisition i s based on the registered rural laborers, regardless o f whether they rely o n agricultural income or are employed in enterprises or private business. Therefore, the level o f actual displacement i s less than the statistical level o f surplus laborers. The RAP sampled four villages’ rehabilitation plans to review the potential effectiveness o f alternatives for livelihood restoration. Most, but not all, villages are expected to redistribute remaining collective land after land acquisition so that al l villagers retain a share o f land. In such cases, the land compensation and resettlement subsidy will be used to invest in productive activities or to improve local living standards.

In some villages, land will not be redistributed if the remaining shares become too small for practical use, or if villagers do not rely o n agricultural income. In such cases, village consultation meetings will identify the villagers to be considered displaced surplus laborers. Rehabilitation arrangements in each village also are subject to village consultation (requiring a two-thirds approval). In some cases, individuals may choose to receive a cash resettlement subsidy (at minimum, an amount equal to the total resettlement subsidy received by the village divided by the number o f displaced surplus laborers). These individuals can then engage in self-employment or find their own employment opportunities. In other cases, those identified as displaced surplus laborers will be offered employment in village or township enterprises, with a minimum salary o f 500 RMB per month. Those to be provided employment will receive 500 RMB per month in transitional support until they are actually employed.

The rehabilitation plan for house replacement i s divided into two phases based o n the two designed schemes - Year 1, and Year 2-to-5 schemes. In the Year 1 scheme, 60 percent o f households will be offered cash compensation, 20 percent o f l o w income households will be allocated highly subsidized apartments, and 20% o f the households will have the option to purchase second-hand houses in an urban area. In the Year 2-to-5 scheme, most of the affected households will be offered apartments for purchase at a discounted price. Rural residents have been offered two options. They can either get a fully prepared replacement plot to reconstruct housing in their village, or they can elect to receive 150 percent o f replacement cost in compensation for their demolished structure to purchase replacement housing outside o f their village. As in urban areas, rural low-income households will be eligible for other forms o f assistance, including eligibility for subsidized rental apartments or discounted apartments for purchase.

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The loss o f benefits to enterprises and private businesses during the construction period will be negotiated through extensive consultation. Shops and enterprises will receive payment for loss o f profits and wages, and affected employees wil l receive support for the transitional period until normal operations can resume. The enterprises involved are owned by the municipal government and local district collectives. Impact surveys indicate that, in most cases, the enterprises will be affected partially by the extension o f the road improvement and that the main structures or workshops will not be demolished. Therefore, production will not be affected seriously and the enterprises do not need to be relocated to other places. If the enterprises prefer to restore production by themselves, the project implementing agency will provide them with cash compensation and negotiated transitional cash assistance. For private businesses, the project implementing agency wil l pay compensation at replacement cost for lost structures and improvements required therein, will provide assistance to offset temporary business losses and to provide temporary wage support for employees, and will pay for moving expenses. Additionally, the project will provide information relating to available alternative business locations and rental costs, and in some cases will assist businesses in relocating into specialized markets or into newly constructed housing areas.

The project management office has conducted a detailed household survey. Low-income families, single-mother families, and vulnerable groups o f people have been identified. Municipal government will offer preferential policies, during implementation o f the project, to 20 percent o f the economically and socially disadvantaged families affected by the project components.

Institutional Arrangements

In China, the project management office has no authority to acquire land in rural area through regulatory means, or to directly implement any resettlement-related measures. Land acquisition authority, and resettlement-related responsibilities, l ie instead with the municipal districts involved. Under such circumstances, close coordination between the project management office and the relevant land administration bureaus i s essential for effective resettlement. For State owned land in urban area, the land to be used will be transferred from land administration bureaus to the project management office.

Building on past Bank experience with projects in Hubei Province and in Wuhan, the municipal government and municipal districts have established a "leading group" to address any issues that may arise during implementation. The project management office has also established an intemal resettlement rehabilitation office and relevant divisions to work with district-level authorities on routine matters.

Moreover, the project management office will reduce the process o f resettlement fund cash f low in order to avoid the fund deduction, which may incur during the disbursement o f the fund. The project management office will also strengthen the capacity o f district-level and resettlement fund management. A computer software-based resettlement management network will be set up for a l l affected districts. A Resettlement monitoring institute will establish monitoring stations in al l involved districts for dynamic and systematic monitoring. The monitoring stations will invite resettlement representatives to participate in monitoring resettlement work.

Community Participation and Public Disclosure

Potentially affected communities were consulted during both project design and preparation o f the RAP. Additional formal and informal consultations were undertaken at both the district level and the residential committee level.

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For R A P preparation, the consultation process was initiated during the process o f conducting a census and socioeconomic surveys, which began in March 200 1. Potentially displaced persons were involved in identifying project-related impacts and in measuring potential losses o f land, structures and other assets. Residential committees and village-level consultations also took place in early 2002 to review proposed compensation rates and other aspects o f the RAP. The consultation process will continue throughout the implementation phase, in conjunction with resettlement monitoring activities.

Information regarding the project and the resettlement program has been publicly disclosed as required by Bank policy. The draft R A P i s available for public review at the provincial and municipal libraries, with notification published in Wuhan Da i ly on February 19,2003. Additionally, the draft R A P was placed in the Bank Information shop in February 2003. In addition to formal R A P disclosure, separate campaigns have been, or will be, undertaken to ensure that affected persons are informed about resettlement aspects o f direct relevance to them. This information, published in booklets for distribution to households or in posters for residential committee or village display, includes the projected timetable, compensation standards, rehabilitation measures, and information regarding whom to contact and procedures to be fol lowed for those with complaints.

Resettlement Cost and Implementation Schedule

The cost o f implementing resettlement measures i s estimated at RMB 1,585.63 mi l l ion (about US$193.4 million), including payment o f associated fees, monitoring costs and contingency allowances. Estimated resettlement costs are included in the project budget.

Monitoring o f Resettlement Implementation

Resettlement implementation will be subject to external project monitoring, to be conducted by a team functioning independently o f the project owner and provincial resettlement implementing agencies. The monitoring institute i s requested to set up monitoring stations in al l involved municipal districts and to supervise resettlement implementation dynamically and systematically. Independent monitoring reports will be submitted to the project management office and the Bank twice a year. The reports will review whether implementation i s in compliance with RAP terms and will evaluate the effectiveness o f resettlement measures in improving or restoring incomes and living standards.

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Additional Annex 13: Wuhan Public Transport System: Current Situation, Improvements and Reform

CHINA: Wuhan Urban Transport Project

Introduction and Background

1. This Annex summarizes Wuhan Municipal Government’s current plans for improvements to public transport services and the reform o f Wuhan’s public transport sector. It also outlines the possible role that the Bank project could play in supporting this reform. Past Bank experience (since SMTP I in 1991) suggests that the Bank cannot lead reform but only support measures being proposed by municipalities and encourage decision makers. The Bank’s role thus far has been l imited to providing ‘knowledge’ input when requested.

2. since August 2001. A Wuhan team including senior staff f rom several agencies visited six other Chinese cities that have undertaken PT reform, and analyzed their experiences. A draft Wuhan Public Transport (PT) Reform program-was prepared, reviewed by a wide range o f staff, and submitted to the government for approval. The government has agreed to the proposal in principle. Implementation o f the reform program began in February 2003.

Wuhan municipality has been formulating and implementing proposals for public transport reform

3. the Wuhan PT sector by (i) (ii) (iii) (iv) (v) (vi)

The core o f the reform is to gradually strengthen the institutions, management and operations o f

separating the government and enterprise functions o f the P T sector, providing clearly defined regulatory arrangements, rationalizing the bus route management and competition, gradually increasing the financial independence o f the operating and maintenance companies, attracting other (non government) resources into the sector, and transforming gradually the operating companies into l imited l iabi l i ty companies.

Wuhan is working intensively on the agenda and its implementation.

Current Situation

4. the responsibility o f the Wuhan Public Facilities Management Bureau. PT sector management is now the responsibility o f four government departments: Wuhan State-Owned Property Management Commission, Wuhan Transport Commission (WTC), Wuhan Property Price Management Bureau, and Wuhan Finance Bureau. The roles and responsibilities o f these departments are outlined below.

Organizational Arrangements. Before August 200 1, PT sector management and operations were

4.1 Government, the Commission authorizes the state-owned P T enterprises to function as investors in state-owned property. It also cooperates with the concemed government departments to appoint and monitor the performance o f managers o f the state-owned P T enterprises. In addition the Commission i s responsible for

Wuhan State-Owned Property Management Commission - representing the Wuhan Municipal

0

0

checking and approving changes in property rights’ or major asset transactions o f the state-owned P T enterprises. checking and evaluating the operational achievements o f the state-owned P T enterprises, and giving performance related awards or penalties.

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0 supervising the state-owned P T enterprises financial and capital activities.

4.2 Wuhan Transport Commission i s responsible for checking the qualifications o f PT enterprises in Wuhan as we l l as the supervision and overall management o f the operations o f these enterprises, working out the P T development plan for Wuhan as we l l as specifying the P T level o f service, PT routes and the location o f P T stops and interchanges, management o f the operating rights o f P T routes, and

0

0

0

0 collecting urban PT statistics The commission also cooperates with the Property Price Management Bureau to monitor PT fares, assists the relevant departments o f the govemment to work out the prices for P T tickets and the monthly-pass, and then implements fare revisions once approved.

4.3 Wuhan Property Price Management Bureau i s responsible for supervising and checking the implementation o f the price regulated for the P T tickets and the monthly-pass, and checking and approving the price adjustment to P T ticket and monthly-pass according to the change in price indices and P T development.

0

0

4.4 o f P T enterprises, and based o n this review, for working out the financial subsidy policy and the related subsidy plan for the fol lowing year.

Wuhan Finance Bureau i s responsible for carrying out an annual review o f the financial position

5. Public Transport Companies. Wuhan currently has two public transport enterprises -the Wuhan Public Transport General Company (WPTGC) and the Wuhan Tongheng Corporation Limited. WPTGC consists o f eight operating companies: seven branch companies (six bus companies and the trolleybus company), and a sub company - the ferry company which i s an independent legal entity. The Tonghen Corporation i s a jo int venture between the General Bus Company and a Hong Kong Company.

5.1 The enterprises collectively employ 27,868 active employees (of the total employees about 10 percent are employed in maintenance, 37 percent are drivers, and 7 percent are conductors) and are also responsible for 5,296 retirees (a total o f 34,164 employees). Overall, the enterprises have f ive employees per bus, which by international standards i s acceptable for buses operated with conductors.

Employees.

5.2 PT enterprises’fmed assets. The init ial value (in November, 2003), o f the original asset o f WPTGC was 1492.36 mi l l ion yuan, and the net value (after al lowing for depreciation) was 896.02 mi l l ion yuan. The original f ixed assets o f the enterprises that are not independent legal entities was 1167.45 mi l l ion yuan, and the corresponding net value i s 665.99 mi l l ion yuan. The original f ixed assets o f the independent legal entity subsidiary companies was 196.14 mi l l ion yuan, and the corresponding net value was 101.26 mi l l ion yuan. The value o f the land assigned to PTGC was 128.77 mi l l ion yuan. The f ixed asset are categorized as: a) operational Buses, b) other Vehicles, c) buildings (depots, parking areas, etc.), d) equipment (for maintenance, re-fueling, etc.), and e) other assets (office equipment, living quarters, etc.). The value o f these assets i s shown in the table below.

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Other vehicles Buildings Equipment Other Sub-total Land

I Total I 149.236 I 59.634 I 89.602 I

706 375 33 1 5,132 2,866 2,266 2,226 1,246 980 3,436 1,266 2,170

19,614 9,488 10,126 12,877 12,877

6. Public Transport Operations

6.1 monthly-pass bus routes (including 7 trolleybus routes) and 159 non monthly-pass bus routes. The total route length i s 4391.1KM, and the route network length i s 735.5KM. The route network density i s 2.98KMKM2. The network also consists o f 8 passenger ferry lines, 2 vehicle ferry lines and 21 mini-bus routes.

PTRoute Distribution. Wuhan PT system comprises 248 routes, among which there are 89

6.2 among which 1277 are assigned to monthly-pass routes, 4363 to non monthly-pass routes (including 843 air-condition buses, 236 trolleybuses, 120 double-deck buses). The system also consists o f 15 passenger ferry boats, 7 vehicle ferry boats (with a total capacity o f 127 vehicles)., and 464 mini-buses. There are 16.3 buses/10,000 people. In addition, 1,290 taxis operate in Wuhan.

PT Buses and Boats. Wuhan PT system altogether comprises 5640 buses and trolleybuses,

6.3 PT Passenger Volumes. The total PT daily passenger volume i s 2.75 mill ion person trips (non-including taxi ridership). The mode share o f urban PT i s 21.74% (of all trips including walking and cycling).

6.4 total area i s 810,000M2, and the built up area i s 230,982M2. Wuhan PT system consists o f 1,200 stops, and 11 1 other facilities, including 4 interchanges, and 37 termini. There are eleven depots with a parking capacity o f 3950 standard buses, and an annual maintenance capacity for 3560 standard buses.

PT Facilities There are 68 sites designated for PT use in Wuhan (including public land). The

6.5 mill ion yuan, a cost recovery o f 96 percent, requiring an operating subsidy o f just 39 mill ion yuan. The average fare was 1.1 yuan.

Financial Situation. In 2002, overall operating costs were 108 1 mill ion yuan, and revenues 1042

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7. PT fare setting procedure. The current procedure for fare setting and adjustment i s as follows. (i)

(ii) (iii)

(iv)

(v)

P T enterprises submit an application for fare adjustment to the Wuhan Property Price Management Bureau and the Wuhan Transport Commission. Wuhan Property Price Management Bureau reviews P T enterprises’ operating costs. Based o n the results o f th is review, Wuhan Property Price Management Bureau decide whether to institute the fare adjustment procedure,. After approval i s given to institute the adjustment procedure, the P T enterprises submit an application to an information gathering meeting. After the information gathering meeting,, Wuhan Property Price Management Bureau submits the application to the Wuhan Municipal Government and the Provincial Property Price Management Bureaux. The Provincial Property Price Management Bureau makes a decision, based o n the information supplied, whether to grant a fare increase.

(vi)

In October, 2003, in order to maintain PT fares at a reasonable level, which i s beneficial to the enterprises’ development and also acceptable to the public, Wuhan PTGC has submitted an application for fare adjustment to Wuhan Transport Commission and Wuhan Property Price Management Bureau. A fare adjustment i s anticipated in the first ha l f o f 2004.

8. operating rights and to improve service quality, Wuhan Transport Commission issued and has gradually implemented, starting in July,2003, the “Wuhan Bus and Trolleybus Operational Management Regulation”. The main contents o f the Regulation are as follows:

PT routes - Management of Operating Rights. In order to standardize the management o f PT-

(i) Authorization o f route operating rights. The regulation clearly specifies the procedures, conditions and time l i m i t s for the authorization o f these rights. The time limit i s 2 to 6 years. The operators will be authorized for 2 years, 4 years or 6 years’ based o n the opinions o f the public. Management o f route operating rights. The regulation clearly specifies the procedure o f route operating rights’ adjustment, change and cancellation. I t especially regulates the service assessment standard, assessment method and penalties. The service assessment standard includes the service level, safety o f operations, bus condition, settlement o f complaints, and the publics’ assessment. The assessment will be undertaken once a year. I t will take the opinions o f the managing departments, social agencies and the public into consideration. The result o f the assessment wil l determine whether the operator retains the operating rights or in penalized for poor performance.

(ii)

In July,2003, Wuhan Transport Commission chose 43 P T routes, which had good service quality and management for the init ial award o f operating rights. Through this award, the management and monitoring procedures have been strengthened, and service quality has improved. There was a favorable response from the publ ic. Based o n this experience, Wuhan Transport Commission will increase in 2004 the number o f routes awarded. I t i s planned to strengthen this process extensively over the next 2 years.

9. PT route network optimization In terms o f P T fleet size, route length and distribution, operational efficiency and service quality, Wuhan’s P T service occupies a leading place in China, especially in the aspect o f convenience and accessibility. However, with the development o f Wuhan’s economy and in order to achieve the innovative, customer orientated and practical service goals proposed by the government, Wuhan P T must develop to a higher level. Consequently, the Wuhan Transport Commission and PTGC will use the opportunity provided by the Wor ld Bank loan to undertake the

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construction o f P T interchanges and termini, and to push forward the customer responsive optimization o f the route network.

9.1 provide a more reasonable distribution o f interchanges; make full use o f P T resources to realize more regional and professional operations; moderately reduce the operation capacity in central town; relocate some congested stops to reduce delay time as wel l as passengers’ trip time; reduce route duplication as wel l as route length; increase P T mode share.

WTC and WPTGC Objectives for PT route network optimization. Optimize the route network to

9.2 Scope of PT route network optimization. (i) Reduction of route duplication. PTGC has begun to combine the routes where 80% o f the

route length i s duplicated (ii) Distance based fares. PTGC has implemented a distance-based fare on 45 routes which

are not easily adjusted. (iii) “Express Bus Routes”. Introduction o f “Express Bus Route” between locations which

have large passenger volumes. I t i s proposed to establish a network o f “Three Layers and One central point” through a l l these adjustments. The first layer connects with the long-distance transport services at the middle-ring road and also serves the new residential areas. The second layer consists o f the P T termini and interchanges between the middle-ring road and the inner-ring road, which not only benefit the passengers but also connect with the railways. The third layer consists o f several large interchanges o n the inner-ring road, which connect with the light ra i l transit.

9.3 Achievements of PT route network optimization (i) Route duplication has been reduced and route network coverage has been expanded. The

route network i s expanding to the middle-ring road and the boundary between the urban and rural area. Route network density has been increased. The transport demand o f the urban area is n o w being met to a greater extent. PT’ level o f service has been strengthened. P T route length has reached a reasonable level. P T stops are now more evenly distributed, which has solved the problem o f buses queuing at stops and made trips faster and more convenient for passengers

(ii)

(iii) (iv) (v)

Future Developments

10. future development, the current ideas about establishing urban P T rapid transit corridors are set out below.

Establishment of rapid PT corridors. Based o n the existing situation, and the requirements for

10.1 Simultaneously plan the BRT system network and implement PTpriority measures. (i)

(ii)

Implement P T priori ty measures that are customer oriented. Extend the existing bus only lane f rom Wu L u o road to L u o Yu road. Implement PT priori ty measures o n the inner-ring road. I t i s planned to establish a high standard rapid P T system between intersections along Zhongnan road, Zhongbei road, Xudong road and Jiefang road.

10.2 system development strategy and (ii) to specify the related implementation procedures. The scope o f the study will include: a) rapid P T corridor study (PT only lanehoad), b) technical specifications and choice o f

Rapid PT system study. The Objectives o f this study are (i) to formulate the Wuhan rapid P T

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bus type, c) fare management methods, d) P T terminus and interchange study, e) P T priori ty and ITS, and f ) passenger information and bus management systems

10.3 Rapid PT system design Based on Wuhan rapid PT system study as wel l as domestic and international experience, it is planned to work out a practical rapid P T system design program. The objective i s to design an advanced system that i s feasible in terms o f finance and operations. The scope o f the design program will include: a) P T only lane or road design, b) Technical specifications and choice o f bus type, c) fare management methods, d) P T terminus and interchange design, e) P T priori ty and I T S techniques, f ) passenger information and bus management systems, and g) operational management systems .

PT Reform

11. Wuhan Ideas about the Next Steps

11.1 management, to realize the goals o f (i) separating government and enterprise functions; and (ii) separating govemment and state-owned property, and to establish modem state-owned property management and P T operating systems, Wuhan Communist Party Commission and Wuhan Municipal Government carried out the PT management institutional reform program in April, 2003. The original General Bus Company, Trolleybus Company, Ferry Company, Taxi Company, Vehicle Ferry Institute and Bus Manufacturer were re-organized to form the new Wuhan PTGC. After i t s foundation, PTGC adjusted the PT operational structure and PT resource allocation, which improved the efficiency o f usage o f state-owned property. These measures increased the value o f state-owned property and la id a good basis for the future development o f urban P T

PT management institutional reform In order to strengthen the institutional reform o f P T

11.2 Method of institutional change: PTGC will sell i t s operating buses and part o f the production equipment. The income will be used to change the P T companies and to assist s ta f f to change their employer. PTGC will also invest part o f i t s property to fo rm joint-ventures with third parties. The new joint-ventures will run the existing P T routes. Scope of institutional change: All seven operating companies belonging to WPTGC, and the ancillary companies (the property company, station managing company, P T checking-line company, education center, information center, advertisement company and I C card company) will be included in this institutional change. Staffaffected by the institutional change: The total number o f registered staf f affected by the institutional change i s 24,000, among whom 23,000 are employed by WPTGC, and another 1,000 by the ancillary companies. After the institutional change, 86% o f the total staff will have changed their employer. Assets concerned in the institutional change: The assets covered include: operating buses, productive equipment and intangible assets (PT route goodwill)

Sellpart of the state-ownedproperty and change the staffs employer

11.3 PTGC. The investor then uses these assets and his working capital as their investment in the joint-venture. Wuhan, PTGC invests part o f its remaining tangible and intangible assets in the joint-venture.

Establish joint-ventures. Investors will be invited to purchase part o f state-owned assets f rom

11.4 sufficient resources to cover operating costs. They must have sufficient operational and management staff, and technicians, and use scientific management methods. They must also be prepared to accept regulation and supervision by government and the responsible govemment departments. The investors must also

Undertakings Required of Investors. Investors must be in good financial condition and have

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accept to (a) hired employees according to the ratio o f four staf f per bus, (b) s ign a new contract with the employees according to the national labor laws, (c) take responsibility for public welfare programs, such as free tickets for the aged, and persons with disabilities, and the issuing o f monthly-passes, (d) implement the fare and monthly-pass prices, as regulated by Wuhan Property Price Management Bureau, and (e) implement the route adjustment o r route network optimization program, as regulated by Wuhan Transport Commission.

11.5 The new joint-ventures are expected to hire an estimated 20,000 employees o f the PTGC. Generally speaking, al l s ta f f o f PTGC and its ancillary companies will be expected to apply for jobs in the new joint ventures.

Proposals for Current StafJ The total number o f PTGC and ancillary companies staff is 24,000.

12. Wuhan Municipal Government have shown great interest in the development o f PT. M a n y pol ic ies support ing PT have been implemented, w h i c h have assisted in the continuous rapid development o f PT and signif icant improvements i s service quality. T h e these can b e

Government policy support. For many years, Wulian Communis t Party Commiss ion and

12.1 Policies giving priority to the PT system (i)

(ii)

(ii i)

Give priority to efpcient operations. Give priori ty to buses o n street so as to avoid the interference f rom other traffic, and to create a good environment for bus operations. Give priority to land use for PT. Give priority to land use for P T in the planning stage, and include PT land use plan into overall Ci ty Development Plan. Assure capital investment for PT construction. Give priori ty to capital allocation for construction o f P T depots and stops, which should assure the sustained development o f urban PT. Assure convenient transfers for passengers. Fully consider the connection between urban PT and airlines, long-distance transport, railways, boats and light-rail.

(iv)

12.2 On street PTpriority measures (i) Provide bus only lanes. Provide bus only lanes o n some main roads, with more than six

lanes. Provide bus only lanes on some roads, wh ich have only four lanes but have many PT routes. The latter bus only lanes should be used at particular t ime periods. Permit PT buses to do left-tums at some intersections, where such tums are not permitted for other traffic. Permit P T buses run both directions in some one way roads. Move the stop l ine in the bus only lane closer to the intersection, and give PT buses signal priori ty to go first through the intersection. Use some secondary roads as bus only roads. Provide temporary stopping places for taxis.

, (ii)

(iii) (iv3

(v) (vi)

12.3 Welfare Subsidies. Wuhan Municipal Government gives P T enterprises subsidies every year for their welfare activities, such as the monthly-pass, free fares for the old, the blind, persons with disabilities, and the disabled soldiers, which assures the healthy development o f urban PT.

Bank Comments on Reform Proposals

13. Current Status of Reform. M u c h o f the focus thus far has been on clarifying roles and responsibilities in P T with an emphasis o n addressing the f i rst two objectives i.e. separation o f government

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f r om operations and development o f a clear regulatory structure. Some progress has been made o n the third objective - bus route management. The Wuhan Public Transport Group Company (WPTGC) has already been founded, but the six bus branch companies and one trolley-bus Branch Company o f WPTGC are not independent legal entities at th is stage. Wuhan Transport Commission i s responsible for the P T studies and the PT plan, authorized by the municipal government. Experts (including experts f rom Urban Planning Department) will review the finished plan. After i t s approval, the plan will be implemented by WTC and be introduced into the Urban Master Plan.

14. should permit the operators to recover costs. However this needs to be accompanied by systematic analyses by WTC o n the need to increase bus fares. M u c h remains to be done in developing an appropriate fare policy, as the current proposals for route network optimization and P T priori ty appear to leave much o f the decision making to WPTGC. 15. 8 need to be accompanied by a review o f route networks and service levels i s required to address the observed l o w operational productivity. The operating companies are spread too thin, and routes and schedules need to be revised. WMG agencies have expressed concem at what they describe as the overlap of routes - different routes operated by different companies running along a number o f main roads in the ci ty center. If the passenger demand exists for the capacity provided by al l the routes the Task Team does not see this as a particular problem. There are many examples f rom cities outside China o f multiple routes sharing long sections o f road.

Need for a systematic and comprehensive fare policy. The process described in paragraph 6

PT Network optimization. The proposals for route network optimization described in paragraph

16. Need for an operational review. Other aspects o f bus operations also merit review. The current staffbus ratio o f about five staff per bus could be reduced to around 3.5 per bus or below, given the recent introduction o f one person operation (OPO). Passenger and driver behavior at bus stops also has the potential for improvement. Problems were observed at barriered, single lane bus stops with the bus at the head o f the queue holding up the buses behind Since buses do not stop exactly at the bus stops, proper passenger queues do not form and as a result boarding at busy stops i s somewhat disorganized. The introduction o f OPO will require passengers to board at the front door and this wil l encourage queuing and will require drivers to better observe the stops. The schedule adherence i s also reported to be poor. An operational review will examine scheduling o f buses and the dispatching and monitoring o f buses in service. The current practice o f allocating spare buses o n a route-by- route basis i s inefficient and an operational review would help the operators switch their operations to pool spare buses and become more depot or district based rather than route based. The reform proposals may also affect day to day operations. The full implications o f reform would be considered in an operational review.

17. sub-companies and branch operating companies. Whi le details o f the staffing reform are st i l l being finalized, A s a guiding principle it has been established that

Labor reform. I t i s envisioned that WPTGC will carry out the labor and wage reform in the

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Appropriate assistance will be provided to employees made redundant, such as early retirement, retraining, or assistance to start their own businesses. Wage reform will focus on incentive policies that would link wage increases to increases in employee productivity and efficiency.

The Bank’s assistance toward the Wuhan PT reform

18. team (when asked) on issues related to:

The Bank’s role thus far has been to serve as a knowledge bank, providing input to the Wuhan

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(i) (ii) (iii)

(iv)

developing a more comprehensive understanding o f the current issues developing clear objectives for reform and understanding local constraints to change providing an overview o f the broader experience with public transport reform in China and elsewhere developing a phased approach to reform.

19. dialogue with Wuhan P T reform team o n al l aspects o f the Wuhan P T reform. In addition, it i s envisaged that the Bank project could finance:

I t is currently envisioned that during Project implementation, the Bank will continue to have further

Specific TA o n competitive bidding o f routes, types o f contract and o n the j ob training o f W T C staff managing the bidding process On-the-job training for other aspects o f W T C responsibilities (overall planning, service monitoring etc) Advice and on-the-job training to W T C on fare setting, different types o f fares and fare media, revenue sharing Advice and on-the-job training to the operating companies on network development, patronage and revenue forecasting, cost forecasting and general business planning Advice o n setting reasonable prof i t levels with associated fare determination mechanisms to help operating companies achieve these profi t levels Advice on developing five-year financial plans for the companies Consultant services to study Wuhan P T planning and improvements to the P T bus route network Consultant services o n Bus Rapid Transit Network development, design and implementation

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Additional Annex 14: [Development of Wuhan Transport Strategy] CHINA: Wuhan Urban Transport Project

Introduction

A key element in the preparation o f the Project has been the formulation o f the Wuhan Urban Transport Strategy. The strategy i s important equally in terms o f the inclusive process that i s generating it, and the introduction offinancial constraints, as i s the analytical framework it i s producing. The process involved many WMG agencies working together to create within the overall vision for the development o f the city, a coordinated and integrated strategy for the development o f the transport system under a number o f development scenarios and identified funding constraints.

Fol lowing the init ial discussions with the Bank regarding the content o f the overall project, WMG constituted a number o f Working Groups with high level representation. The Working Groups jo int ly identified a series o f overall goals for the transport sector. These goals were defined in response to the key sector issues that had been identified. A comprehensive transport study was then carried out by the Wuhan Comprehensive Transport Planning and Design Institute (WCCTPDI), with technical assistance from domestic and international consultants.

This process helped to fill the planning vacuum that previously existed. Although the city had an approved Master Plan for 2020, there was l i t t le indication o f the phasing or priori ty o f individual components. Infrastructure investments were being implemented on an ad-hoc basis with little coordination, and no consideration for the overall vision for ci ty development, or availability o f finance.

Vision The transport strategy was formulated within this vision for Wuhan city, which can be characterized as:

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A ci ty to reinforce i t s position as an important industrial and trade center, as we l l as a transport and communication hub in the country A "people-oriented" transport system providing high quality transport system and living environment to both residents and visitors

Goals T h e specif ic transport development goals established by WMG may b e summarized as:

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To prov ide convenient, speedy and comfortable pub l i c transport services To encourage the use o f public transport To min im ize the adverse effects o f external and through traffic To strengthen the l inkages between the var ious distr icts in the city To develop the individual areas in the c i t y with balanced land uses and adequate local street sys tem To improve the ef f ic iency o f the transport system through t ra f f i c and demand management techniques

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Key Transport Sector Issues

The key issues identified by WMG may be summarized as follows:

. cross-river trafic has increased significantly in recent years: the original bridges are over-loaded and demand i s unevenly spread o n the newer crossings. Cross-river travel i s a major concem in Wuhan as it affects the integration o f the three towns within the city.

* central area trafic congestion i s increasing rapidly as major inner area developments are taking place, in particular in the central areas o f Hankou. The traffic in the area, in particular at intersections, has become very congested.

external trafic i s a perennial transport issue in Wuhan as it i s a major transport hub in central China. Several major national highways pass through the study area and two major intercity rai l lines intersect in Wuhan.

9 the road network i s inadequate to support the growth o f vehicle traffic and urban development in the outlying areas. The functional road hierarchy o f the network i s incomplete and ill-defined, resulting in most traffic being confined onto a l imited number o f major arterials: some key l i nks in the network are missing.

public transport services are currently fair ly good overall (compared with other cities in China): however, the route network i s not wel l structured or responsive to changing demands. A substantial growth in patronage, targeted in the coming years, wil l need a significant expansion in the services.

The Planning Process

At the outset, WMG produced a long l i s t o f potential schemes (the init ial l i s t consisted largely o f road infrastructure schemes) for inclusion in the Bank project or for implementation using local funding in the same period. This l i s t represented the priorities o f the government, in accordance with the established Master Plan.

It was determined that the total cost o f the WMG proposals significantly exceeded the l ikely available funding at least over the init ial five years to 2007. W h i l s t a l l the schemes conformed to the adopted and approved Master Plan, there was little or n o indication as to the relative needs or merits o f each individual scheme to resolve the identified issues.

A detailed analysis o f WMG financial resources and commitments was undertaken and a realistic assessment made o f the capacity o f the c i ty to take o n additional projects in the transport sector over and above those proposed for WB funding. (The summary is presented in Annex 5). I t was evident f rom this analysis that the Wor ld Bank loan would constitute the major funding source for the transport sector over the next five years. Local funding would be restricted to expenditure o n minor schemes and the completion o f current major commitments (4th Yangtse Bridge and the extension o f LRT L ine 1).

An objective o f the strategy analysis was thus to prioritize the schemes identified and to select those schemes which most closely responded to the key issues and problems. WMG, in conjunction with the Bank, reviewed and screened each o f the proposed projects in terms o f traffic demand; resettlement; environmental impact; conformity to the overall plan and strategy; and overall value for money. A shorter

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core l i s t o f schemes for possible Bank funding was thus defined. These were then subjected to more rigorous alternatives analysis and evaluation using the traffic model. T w o alternative strategies were developed. One focused on improvements to the highway network, the other on the public transport system. The conclusions drawn from the model analysis were that:

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road network improvement, focusing on strengthening the road hierarchy will be crucial to relieve traffic congestion as wel l as to improve the efficiency o f bus operation. bus priori ty schemes, in the near future, would be a more cost effective means to improve the transit system than building the rai l system. an additional cross-river link in the core area (Qing Dao Lu Tunnel) i s essential to relieve the traffic on the No. 1 and No. 2 Yantze Bridges. traffic condition in the central area o f Hankou will deteriorate greatly in the near future due to the expected growth in that area and the lack o f well functioning local streets. the transport strategy, in the near term (up to 2007), should focus on perfecting the road network hierarchy and enhancing system efficiency through bus priori ty and traffic management measures. the core l i s t o f schemes in the Wor ld Bank project package wou ld support the achievement o f the road network development goal in 2007 given the transport investment constraint. There i s strong traffic demand for the Wor ld Bank projects, except for southern part o f the Middle Ring Road, which may need further study.

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Strategy for 2007 In addition to the road investments, traffic management and bus priori ty schemes in the Wor ld Bank project, the 2007 Strategy resulting f rom the analysis includes the No. 4 Yantze Bridge and the 2nd phase o f the No. 1 Rai l L ine (which are considered as committed projects) and the fol lowing govemment funded schemes:

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A north-south minor arterial in the o ld airport to relieve traffic on parallel arterials Extension (upgrade) o f Qin Yuan Lu from Wuqing Gan Dao to Heping Lu (Le., to extend the Qin YuanLu WB project) A missing link segment on Ziyang Dong Lu (from Zhong Shan Lu to Saihu Lu, in Wuchang) to primari ly serve local traffic, bicycles and pedestrians.

Due to financial constraints, the Qing Dao Lu Tunnel, the additional river-crossing link in the center ci ty area, was not considered in the 2007 preferred development scheme. However, the analysis indicates that the tunnel i s crucial and should be built once the necessary construction funding i s secured.

Strategy for 2012 Based on the analysis, the mid-term transport strategy should focus on the following:

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Construction o f the Qing Dao Lu Tunnel Minor and local streets in central area to relieve the traffic burden on major arterials. Local streets in the new development areas. Implementation o f the f irst phase o f the Metro L ine No. 2 l ine to relieve traffic o n the radial corridor in Hankou area.

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Long Term Strategy In the long term, the study suggested that the transport development strategy should cover the following:

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Implementation o f additional cross-river l i nks to deal with the increasing congestion on the No. 1, No. 2 and No. 3 Yantze Bridges, and the Qing Dao Lu Tunnel. Completion o f the roadway network with a balanced functional hierarchy, in particular the enhancement o f the local streets system in the center city area and new development area Implementation o f high capacity transit system (BRT, LRT or subway) progressively on major transit corridors to relieve the traffic congestion o n arterials, and to improve the mobil i ty o f people f rom and to new development areas.

Next Steps

The formulation o f the Strategy has led to the development o f a continuous planning process that i s inclusive (of different interests and agencies) as wel l as responsive (not rigid but flexible in response to changing circumstances). This process helps WMG in assessing the value o f any transport pol icy or investment, and not just those included in the Bank project.

In parallel with the major investments identified over the next five years, WMG has hired a team o f local and intemational consultants to prepare a long-term transport strategy for the entire municipal area covering al l modes.

The ci ty i s also to improve the overall efficiency and effectiveness o f the transport system through capacity building o f relevant agencies, further refinement o f the strategy, and greater use o f planning and management techniques. Within the project, the Bank i s to provide technical assistance to assist WMG with these improvements, and specifically to support the fol lowing activities:

1. Draft ing o f a transport development white paper wh ich outlines transport development policies and provides the guideline for transport development within the built up area.

2. policies.

Draft ing and updating annually o f five-year transport strategy documents covering investments and

3 . Strengthening o f the transport planning function in the city, through: institutional strengthening o f relevant planning agencies enhancing the technical capability o f the planning agencies strengthening the working relationship with the planning institute - the agency responsible for developing the Master Plan

i. ii. iii.

4. Conducting more detailed studies to address various specific issues, including: i. cross-river travel demand ii. transit system development strategy iii. center city traffic demand management

5. Enhancement o f the Transport Strategy, through: i. ii. iii.

refinement o f the mid and long-term transport strategies development o f road network functional hierarchy greater integration o f land use and transport development

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MAP SECTION