Benefits and Target Population Project Economic Evaluation

Clean Final PIP_WINRIP_IBRD 06032012 16 supervision and increase oversight costs. WINRIP adopted a corridor approach, whereby segments are grouped and located in sequence, thereby easing technical supervision and third party monitoring. For WINRIP the design and design checking processes have been strengthened. A comprehensive Design Specification, and Final Engineering Design and preparation of associated Bidding Documents for WP 1 is being undertaken directly by the Project Preparation Consultants PPC. The implementation arrangements have been clarified to enable the consulting engineers in civil works contracts to have clearer authority and responsibility and thus improve accountability for approving and paying for completed works. Monitoring of the effectiveness of supervision procedures will be undertaken by the DSC and overseen by the CTC. Technical audits will also address quality of work issues, and will be used to verify the adequacy of all works. The Project Management Manual is prepared in separated document ready for WINRIP implementation.

1.7.2 Benefits and Target Population

Project beneficiaries will be road users in participating provinces, districts and towns in the four provinces included in the WINRIP region North Sumatra, West Sumatra, Bengkulu and Lampung. Direct beneficiaries of the project include people who live in the vicinity of the project area who directly benefit from the improvement of the road sections financed by the project. The project road sections traverse 12 districts 3 with a total population of more than 4 million 4 of which around half are women. In addition, the betterment and maintenance of roads will create employment for people. i. Improved road conditions and connectivity between major centers and modes of transport will lower transport costs for passengers and freight. This will reduce the cost to local industries and of inputs to local agriculture, and the cost of transporting products to markets, and provide a significant stimulus to regional economic development; ii. Improved transport services in the provinces concerned will have a significant impact throughout Sumatra, given that the road improvements are to the main arterial roads on the island. Indirectly the benefits will impact on isolated communities with low income populations. Improved roads and accessibility will increase access to jobs, health, social and educational facilities in disadvantaged rural areas as well as in the administrative, economic and social centres. iii. The project will strengthen the ability of central and regional based road networks management units to manage the road and bridge assets for which they are responsible. The projects emphasis on transparency and accountability will impact on governance in all areas.

1.7.3 Project Economic Evaluation

An economic evaluation has been undertaken of almost all civil road work components. Nearly all projects proposed for inclusion in W INRIP have an EIRR greater than 15: this being the normal minimum required. The few projectscorridor links which do not meet the 3 Lampung Barat, Pasaman, Pasaman Barat, Agam, Mokomuko, Tapanuli Tengah, Pesisir Selatan, Padang Pariaman, Tanggamus, Bengkulu Selatan, Bengkulu Utara, Lampat Barat. 4 2010 population estimated using the 2000 population census and an annual population growth rate of 1.136 Clean Final PIP_WINRIP_IBRD 06032012 17 15 EIRR standard are justified by additional criteria, including broader socio-economic and development benefits. Many road sub-projects have EIRRs well above the minimum indicating urgency for implementation for economic efficiency. Annex 3 provides details of the economic evaluation for the road works, the largest component of the project. Economic evaluations have not been carried out for bridge works. These works have been selected for reasons of necessity to replace ailing existing bridges or provide bridge capacity compatible with the associated road works.

1.8 Environmental and Social Safeguards