OVERALL ASSESSMENT

V. OVERALL ASSESSMENT

A. Relevance

83. At the appraisal stage, the Project supported the Government’s strategy for improving NRs in the Lao PDR, especially the need to connect the northern and southern parts of the country. Besides enabling efficient, cost-effective traffic movement within the country, the road links Thailand with Champasack Province. Although the Project was designed to link Cambodia also, this objective was only partly fulfilled due to the absence of the 6.9-km link road on the Lao PDR- Cambodia border. Although this link road was originally included in the project scope, it was removed during implementation. The resulting cost savings were used to build SBST roads in Khong Island. Thus, while this change in scope may have reduced the positive impact of the Project on regional cooperation, it enhanced the poverty reduction impact in Khong Island. The Project has been successful in linking Veun Kham on the Cambodian border with Pakse, enabling an increase in traffic in the area. On an overall basis, the Project is rated highly relevant.

B. Efficacy

84. The main purpose of the Project was to improve transport services in the region by improving the project road. This has been achieved. Most of the project outputs were as planned, with some minor deviations. The Project’s outcomes were highly positive in terms of reducing the transport costs and transit times. These project outcomes helped to create an enabling environment for economic development in the influence area. There was a general reduction in poverty and a clear improvement in regional cooperation. Overall, the Project is rated as highly efficacious.

C. Efficiency

85. The Project used existing road alignments with some deviations to avoid relocating villagers. This helped in reducing social disruption at a small increase in costs. It enabled the road to be connected to the new Lao-Nippon Mekong Bridge. There was effective coordination with other aid agencies to ensure this. Given the projected rise in traffic volumes, the EIRR is expected to be 26.3%.The Project is rated highly efficient.

D. Sustainability

86. Although the maintenance requirements on the project road have been low in the initial years after completion, the road will need periodic maintenance in the medium term. The Government is committed to continuing with the RMF to ensure a streamlined and planned approach to maintenance. Based on the current dialogue among the Government, ADB, and other international aid agencies on maintenance, the main issues are being targeted and it is reasonable to anticipate that there will be a phased stepping up of the financing of the RMF. The Lao PDR is a relatively small country, and a streamlined approach of this nature should yield positive results in the future. Other development impacts, including regional cooperation, appear to be positive and sustainable. Overall, the Project is likely to be sustainable.

E. Institutional Development and Other Impacts

87. TAs associated with the Project had a satisfactory institutional impact and promoted private sector participation. One of the TAs helped MCTPC to privatize two government

enterprises. The other TA assisted in the provision of training at provincial levels. While the environmental concerns (e.g., deforestation due to construction activities) identified during implementation were addressed, the Project gave rise to other issues linked with migration impacting the environment. Overall, the socioeconomic impact appears to be positive and is rated as significant, as the economic growth that took place in the road influence area helped to improve people’s incomes and standard of living.

F. Overall Project Rating

88. Based on the overall assessment of the five evaluation criteria and the standard weighting system of the Operations Evaluation Department, the Project is rated as highly successful.

G. Assessment of ADB and Borrower Performance

89. The Borrower fulfilled 14 of 16 obligations under the Loan Agreement as stated in the PCR. The two covenants not fulfilled are discussed in para. 36. The performance of MCTPC has improved consistently as it has implemented more ADB (and World Bank) projects. Issues relating to Contract C were unexpected. The resulting additional inputs from ADB were helpful in supporting MCTPC in resolving the related issues. The PMU performance was satisfactory. During implementation, ADB coordinated closely with MCTPC to facilitate changes in project scope. This enabled more appropriate allocation of funds, e.g., when the scope of Contract D was reduced due to the exclusion of certain sections, the surplus funds were used to provide a better quality road on Khong Island. Overall, the performance of both the Borrower and ADB is rated as satisfactory.