World Bank Document · document of the world bank report no: icr00002771 implementation completion...

Document of

The World Bank

Report No: ICR00002771

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IDA-39300 IDA-45710)

ON AN

IDA CREDIT (IDA-39300)

IN THE AMOUNT OF SDR 138.44 MILLION

(US$207 MILLION EQUIVALENT)

AND

IDA CREDIT (IDA-45710)

IN THE AMOUNT OF SDR 172.00 MILLION

(US$253 MILLION EQUIVALENT)

TO THE REPUBLIC OF KENYA

FOR THE

NORTHERN CORRIDOR TRANSPORT IMPROVEMENT PROJECT

June 29, 2016

Transport and ICT Global Practice

Africa Region

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CURRENCY EQUIVALENTS

Currency Unit = Kenya Shilling (KSh)

(Exchange Rate Effective)

(February 29, 2004) (December 31, 2015)

US$1.00 = KSh 77.0 US$1.00 = KSh 102.4

SDR 1.00 = US$1.4952 SDR 1.00 = US$ 1.3857

FISCAL YEAR

July 1– June 30

ABBREVIATIONS AND ACRONYMS

AF Additional Financing

AFD French Development Agency (Agence Française de Développement)

AfDB African Development Bank

APRP Annual Public Road Programme

CAS Country Assistance Strategy

CAT1 Category 1

DCA

EASA

Development Credit Agreement

East African School of Aviation

EBK Engineering Board of Kenya

EIB European Investment Bank

EIRR Economic Internal Rate of Return

ERB Engineers’ Registration Board

ERSWE Economic Recovery Strategy for Wealth and Employment Creation

EU European Union

FAA United States Federal Aviation Administration

FM Financial Management

GNSS Global Navigation Satellite System

GoK Government of Kenya

GPS Global Positioning System

IA Implementing Agency

IASA International Aviation Safety Assessment

ICAO International Civil Aviation Organization

ICR Implementation Completion and Results Report

ICT Information and Communications Technologies

IDA International Development Association

INT

IRI

Department of Institutional Integrity

International Roughness Index

ISR Implementation Status and Results Report

JICA Japan International Cooperation Agency

JKIA Jomo Kenyatta International Airport

KAA Kenya Airports Authority

KCAA Kenya Civil Aviation Authority

KeNHA Kenya National Highways Authority

KeRRA Kenya Rural Roads Authority

KMA Kenya Maritime Authority

KRA Kenya Revenue Authority

KRB Kenya Roads Board

KTSSP Kenya Transport Sector Support Project

KURA Kenya Urban Roads Authority

M&E Monitoring and Evaluation

MoF Ministry of Finance

MoTC Ministry of Transport and Communications

MoTI Ministry of Transport and Infrastructure

MoRPWH Ministry of Road, Public Works and Housing

MTR Mid-Term Review

NCA National Construction Authority

NCTIP Northern Corridor Transport Improvement Project

NCTTA Northern Corridor Transit and Transport Agreement

NCTTCA Northern Corridor Transit and Transport Coordination Authority

NDF Nordic Development Fund

NGO Non-Governmental Organization

NMT Non-Motorized Transport

NPV Net Present Value

NTSA National Transport and Safety Authority

NUTRIP National Urban Transport Improvement Project

OPRC Output- and Performance-based Road Contract

PAD Project Appraisal Document

PDO Project Development Objective

POC Project Oversight Committee

PPP Public-Private Partnership

PTT Project Technical Team

RAP Resettlement Action Plan

RCCI Roadworks Construction Cost Index

RSGIAP Road Sector Governance and Integrity Action Plan

RSIP Road Sector Investment Program

TOR Terms of Reference

TSA Transport Security Administration of the United States

TTL Task Team Leader

UNES University of Nairobi Enterprises and Services Limited

VAT Value Added Tax

VCT Voluntary Consulting and Testing

VPD Vehicles per Day

Senior Global Practice Director: Pierre Guislain

Acting Practice Manager: Aurelio Menendez

Project Team Leader: Josphat O. Sasia

ICR Team Leader: Akiko Kishiue

Kenya

Northern Corridor Transport Improvement Project

CONTENTS

Data Sheet

A. Basic Information ............................................................................................................... i

B. Key Dates ............................................................................................................................ i

C. Ratings Summary ................................................................................................................ i

D. Sector and Theme Codes ................................................................................................... ii

E. Bank Staff ........................................................................................................................... ii

F. Results Framework Analysis ............................................................................................. iii

G. Ratings of Project Performance in ISRs ......................................................................... viii

H. Restructuring ..................................................................................................................... ix

I. Disbursement Graph ........................................................................................................... x

1. Project Context, Development Objectives and Design ............................................... 1

2. Key Factors Affecting Implementation and Outcomes ............................................... 6

3. Assessment of Outcomes .......................................................................................... 14

4. Assessment of Risk to Development Outcome ......................................................... 21

5. Assessment of Bank and Borrower Performance ...................................................... 22

6. Lessons Learned ........................................................................................................ 24

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ........... 26

Annex 1. Project Costs and Financing .......................................................................... 27

Annex 2. Outputs by Component .................................................................................. 28

Annex 3. Economic and Financial Analysis ................................................................. 46

Annex 4. Bank Lending and Implementation Support/Supervision Processes ............. 52

Annex 5. Beneficiary Survey Results ........................................................................... 54

Annex 6. Stakeholder Workshop Report and Results ................................................... 55

Annex 7. Summary of Borrower’s ICR and Comments on Draft ICR .......................... 56

Annex 8. Comments of Co-Financiers and Other Partners/Stakeholders ..................... 68

Annex 9. List of Supporting Documents ....................................................................... 69

Annex 10. Road Sector Governance and Integrity Improvement Action Plan………..71

MAP .............................................................................................................................. 77

i

DATA Sheet

A. Basic Information

Country: Kenya Project Name:

Northern Corridor

Transport Improvement

Project

Project ID: P082615 L/C/TF Number(s): IDA-39300,IDA-45710

ICR Date: 06/27/2016 ICR Type: Core ICR

Lending Instrument: SIL Borrower: GOVERNMENT OF

KENYA

Original Total

Commitment: XDR 138.44M Disbursed Amount: XDR 310.21M

Revised Amount: XDR 310.44M

Environmental Category: B

Implementing Agencies:

Kenya Civil Aviation Authority

Kenya Airports Authority

Ministry of Transport and Infrastructure1

Kenya National Highways Authority

Cofinanciers and Other External Partners: Nordic Development Fund

Agence Francaise pour le Developpement (AFD)

B. Key Dates

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 06/30/2003 Effectiveness: 09/16/2004 09/16/2004

Appraisal: 02/09/2004 Restructuring(s):

12/14/2005

04/02/2009

12/27/2012

Approval: 06/17/2004 Mid-term Review: 05/04/2009

Closing: 12/31/2009 12/31/2015

C. Ratings Summary

C.1 Performance Rating by ICR

Outcomes: Satisfactory

Risk to Development Outcome: Low or Negligible

Bank Performance: Moderately Satisfactory

Borrower Performance: Moderately Satisfactory

1 Ministry of Roads, Public Works and Housing and Ministry of Transport and Communications merged and became

Ministry of Transport and Infrastructure. MOTI has State Department of Transport and State Department of Infrastructure.

ii

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Bank Ratings Borrower Ratings

Quality at Entry: Moderately Satisfactory Government: Moderately Satisfactory

Quality of Supervision: Moderately Satisfactory Implementing

Agency/Agencies: Moderately Satisfactory

Overall Bank

Performance: Moderately Satisfactory

Overall Borrower

Performance: Moderately Satisfactory

C.3 Quality at Entry and Implementation Performance Indicators

Implementation

Performance Indicators

QAG Assessments (if

any) Rating

Potential Problem Project

at any time (Yes/No): Yes

Quality at Entry

(QEA): None

Problem Project at any

time (Yes/No): Yes

Quality of

Supervision (QSA): None

DO rating before

Closing/Inactive status:

Moderately

Satisfactory

D. Sector and Theme Codes

Original Actual

Sector Code (as % of total Bank financing)

Aviation 15 9

Central government administration 10 7

Health 1 1

Other social services 2 2

Rural and Inter-Urban Roads and Highways 72 81

Theme Code (as % of total Bank financing)

Administrative and civil service reform 13 13

Infrastructure services for private sector development 25 25

Regional integration 13 13

Regulation and competition policy 24 24

Trade facilitation and market access 25 25

E. Bank Staff

Positions At ICR At Approval

Vice President: Makhtar Diop Callisto E. Madavo

Country Director: Diarietou Gaye Makhtar Diop

Practice

Manager/Manager: Aurelio Menendez C. Sanjivi Rajasingham

Project Team Leader: Josphat O. Sasia Anil S. Bhandari

ICR Team Leader: Akiko Kishiue

iii

ICR Primary Author: Akiko Kishiue

Team Assistant Damon C. Luciano/ Rosemary

Ngesa Otieno Rosemary Ngesa Otieno

F. Results Framework Analysis

Project Development Objectives (from Project Appraisal Document)

The Development Credit Agreement (DCA) stated the project development objectives (PDO)

as follows: The objective of the Project is to enhance the efficiency and effectiveness of the

Borrower's transport sector through: (a) increasing the efficiency of road transport; (b)

enhancing aviation safety and security to meet international standards; and (c) promoting

private sector participation in the management, financing, and maintenance of road assets.

The Project Appraisal Document (PAD) worded the PDO slightly different but no significant

discrepancy. For the purposes of the Implementation Completion and Results Report (ICR),

in line with the guidance,2 the PDOs stated in the DCA will be used.

Revised Project Development Objectives (as approved by original approving authority) In April 2009, the original PDOs were revised by the addition of one more PDO to support

the implementation of the post-election recovery program. The revised PDOs in the Financing

Agreement which was amending and restating the original DCA were to enhance

the efficiency and effectiveness of the Recipient's transport sector through: (a) increasing the

efficiency of road transport; (b) enhancing aviation safety and security to meet international

standards; (c) promoting private sector participation in the management, financing, and

maintenance of road assets; and (d) restoring vital public infrastructure and assets damaged

as a result of the 2007 post-election crisis. The PDOs in the Additional Financing (AF) Project

Paper are worded slightly different without any significant discrepancy.

(a) PDO Indicator(s)

Indicator Baseline Value

Original Target

Values (from

approval

documents)

Formally Revised

Target Values

Actual Value

Achieved at

Completion or Target

Years

Indicator 1 : Freight and passenger travel time by road from Mombasa to Malaba and Busia

reduced by 25 percent.

Value

quantitative or

Qualitative)

Truck - 24 hours

Bus - 18 hours

Car - 14.5 hours

Truck - 18 hours

Bus - 13.5 hours

Car - 11 hours

Truck - 18 hours

Bus - 13.5 hours

Car - 11 hours

Truck - 21 hours (50%)

Bus - 15.5 hours (63%)

Car - 12 hours (71%)

Date achieved 04/30/2004 12/31/2009 12/31/2015 12/31/2015

Comments

(incl. %

achievement)

Indicator partially achieved (average 61%). A significant reduction in travel time

was achieved by 2013 but gains on some road sections later diminished due to

growing traffic volumes. Car travel time met the target in 2009 but later rebounded.

2 p16 Guideline for reviewing World Bank Implementation Completion and Results Reports, updated on August 1, 2014,

IEG, p 58 Implementation Completion Report Guidelines, OPCS, Aug 2006, last updated July 22, 2014

iv

Indicator 2 :

KCAA is cleared as category 1 (CAT1) safety status under the International

Aviation Safety Assessment (IASA) of the United States Federal Aviation

Administration (FAA).

Value

quantitative or

Qualitative)

None

FAA/IASA

CAT1 Clearance

obtained

FAA/IASA CAT1

Clearance

obtained

Clearance not obtained

Date achieved 04/30/2004 12/31/2007 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator not achieved (0%). Change in the regional security situation required

additional security measures. An ICAO security audit in 2015 scored KCAA and

KAA at 88% against a cutoff of 80% for CAT1 clearance.

Indicator 3 : Jomo Kenyatta International Airport (JKIA) in Nairobi is cleared by the TSA for

direct flights to/from U.S. airports.

Value

quantitative or

Qualitative)

None Direct flight

cleared. 100% Direct flight cleared.

Date achieved 04/30/2004 12/31/2007 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Clearance of direct flight to/from U.S. airports by the

TSA was obtained in April 2009.

Indicator 4 : One long-term performance-based road management and maintenance contract

awarded to the private sector and effectively under implementation.

Value

quantitative or

Qualitative)

None 100% 100% 39 long-term contracts

Date achieved 04/30/2004 12/31/2011 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). The concept and approach of OPRCs were well

adopted by KeNHA and KeNHA's capacity has been increased. In FY 2015/16, 39

OPRCs have been awarded and are under implementation.

Indicator 5 : Bids for concessioning of one section of road invited.

Value

quantitative or

Qualitative)

None 100% 100% 100%

Date achieved 04/30/2004 06/30/2007 12/31/2012 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Bids were invited for a proposed toll road and one bid

was received in 2005.Parliament approved the concession but it was cancelled after

a due diligence review raised integrity concerns about the procurement process.

Indicator 6 : Damaged public infrastructure assets are restored.

Value

quantitative or

Qualitative)

Restoration pending. 100% 100% 100%

Date achieved 03/05/2009 12/31/2010 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%) achieved. Renovation and reconstruction of the KeNHA

regional offices in Kisumu, Homa Bay, and Oygis towns have been completed. The

repair of the Kisian-Busia road was also carried out with the GoK internal

resources.

v

(b) Intermediate Outcome Indicator(s)

Indicator Baseline Value

Original Target

Values (from

approval

documents)

Formally

Revised Target

Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 1 : Average roughness less than IRI 3.0 m/km on completed sections of the project

roads.

Value

(quantitative

or Qualitative)

Less than 20% of

project road length.

100% of project roads

have average

roughness of less than

IRI 3.0.

100% of project

roads have

average

roughness of

less than IRI 3.0.

100% of project roads

Date achieved 04/30/2004 12/31/2009 12/31/2015 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Average IRI of project roads is 2.2. Nyamasaria-

Kisumu airport-Kisian road has been handed over in the end of March 2016 and

data is not available yet.

Indicator 2 : Public Buildings restored and functional.

Value

(quantitative

or Qualitative)

0 3 3 4

Date achieved 03/05/2009 12/31/2010 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (133%). The renovation and reconstruction of KeNHA regional

offices in Kisumu (two offices), Homa Bay, and Oyugis towns have been

completed and the buildings are in use.

Indicator 3 : Term contracts awarded for disaster response readiness.

Value

(quantitative

or Qualitative)

0 3 3 0

Date achieved 03/05/2009 12/31/2010 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator not achieved (0%). The Road Disaster Management and Response Unit

has been established and functions as a committee composed of representatives

from road authorities. A term contract was never advertised due to limited financial

resources of MoTI.

Indicator 4 : At least three roadside stations and amenities constructed and functional as per

designs and serving road users and local communities.

Value

(quantitative

or Qualitative)

None 3 3

5 schools, 1 lorry

park, 1 market, 1

community center, 1 1

footbridge and 24.8

km of footpaths were

constructed.

Date achieved 04/30/2004 06/30/2009 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (more than 300%). A lorry park, a community center, a market,

and five schools were constructed. Footpaths and a footbridge as NMT facilities

have been constructed in the urban centers. A lorry park and a market are under

construction.

vi

Indicator 5 :

At least 70% of road users and local persons surveyed become aware or make use

of the Voluntary Counseling and Testing (VCT) and other facilities for HIV/AIDS

campaign along the Northern Corridor.

Value

(quantitative

or Qualitative)

None 70% 70% 100%

Date achieved 04/30/2004 12/31/2009 12/31/2015 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). By 2012, the level of HIV/AIDS awareness among the

corridor users and communities living along the corridors surveyed and use of VCT

and other facilities to mitigate the spread of the disease reached 100%.

Indicator 6 : Legislation enacted for private sector participation in roads.

Value

(quantitative

or Qualitative)

None Yes Yes Yes

Date achieved 04/30/2004 12/31/2012 12/31/2012 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Kenya Roads Act 2007 was enacted, stating the

encouragement of private sector participation in road construction, maintenance,

and management. The PPP Act was enacted in 2013 and a toll road is one of the

prioritized projects.

Indicator 7 : At least 10% reduction in road related fatalities per annum.

Value

(quantitative

or Qualitative)

3,000 2,700 2,700 3,057

Date achieved 04/30/2004 12/31/2009 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator not achieved (0%). The total number of road related fatalities was not

reduced. However, fatalities per 100,000people have been reduced by 23 % from

8.31 in 2008 to 6.4 in 2015.

Indicator 8 : Kenya National Highways Authority established and functional as evidenced by

annual reports.

Value

(quantitative

or Qualitative)

None 100% 100% 100%

Date achieved 04/30/2004 12/31/2009 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Through the enactment of Roads Act in 2007, Kenya

National Highways Authority, Kenya Urban Road Authority, and Kenya Rural

Road Authority have been established and all are functional.

Indicator 9 : All feasibility and design studies carried out satisfactorily.

Value

(quantitative

or Qualitative)

None 100% 100% 100%

Date achieved 04/30/2004 12/31/2009 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). All the selected feasibility and design studies have been

completed: (a) three sections on the Kenya-South Sudan road, (b) Kibwezi-Kitui-

Mwingi-Maua, (c) Narok-Northern Lakeside Tanzania, and (d) Mombasa Southern

Bypass.

Indicator 10 : Timely public disclosure of national program and business opportunities in the road

sector.

Value

(quantitative

or Qualitative)

Partial and late

release of road

investment program

Plans disclosed Plans disclosed Plans disclosed

vii

Date achieved 03/05/2009 12/31/2010 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Road Sector Investment Program (RSIP) and Annual

Public Road Programmes (APRPs) are disclosed on Kenya Roads Board (KRB)

website. (http://www.krb.go.ke/adverts-downloads) All road works were procured

under open tender.

Indicator 11 : The National Construction Authority (NCA) established and functional as

evidenced by annual reports.

Value

(quantitative

or Qualitative)

None NCA established NCA established NCA established and

functional

Date achieved 03/05/2009 12/31/2011 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). NCA was established in 2011 through the National

Construction Authority Act. NCA is executing all functions outlined under the Act.

Annual report 2013/14 has been disclosed and the 2014/15 report will be published

in June 2016.

Indicator 12 : Road Sector Governance and Integrity Action Plan (RSGIAP) implemented

satisfactorily.

Value

(quantitative

or Qualitative)

None 100% 100% Mostly achieved

Date achieved 03/05/2009 12/31/2012 12/31/2015 12/31/2015

Comments

(incl. %

achievement)

Indicator mostly achieved (cannot be measured in %). The RSGIAP was targeting

the entire transport sector, and some of the proposed actions were beyond the

project scope. Implementation status of the RSGIAP is presented in Annex 10.

Indicator 13 : User perception and satisfaction improved in the road sector

Value

(quantitative

or Qualitative)

None >75% of users

surveyed are satisfied

>75% of users

surveyed are

satisfied

n/a

Date achieved 03/05/2009 12/31/2011 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator not achieved (0%) A study to measure this indicator was planned with

funding from the Governance and Anti-Corruption unit of the Bank. However, the

fund was not allocated and the study was not conducted. No existing information

was available.

Indicator 14 : JKIA meets the ICAO and TSA CAT1 security requirements.

Value

(quantitative

or Qualitative)

Not meet 100% 100% 100%

Date achieved 04/30/2004 12/31/2007 12/31/2014 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). JKIA obtained TSA clearance in 2009. Although JKIA

has not obtained the CAT1 status, the ICAO security audit in 2015 scored KCAA,

and KAA at a rate of 88 percent, against a cutoff of 80 percent for CAT1

certification.

Indicator 15 : No. of Passengers handled at JKIA (million).

Value

(quantitative

or Qualitative)

4.7 6.4 6.4 6.4

Date achieved 12/31/2007 12/31/2012 12/31/2015 12/31/2014

Comments

(incl. %

achievement)

Indicator achieved (100%). Based on KAA statistics, the number of passenger

handled at JKIA in 2014 was 6.4million. The information for 2015 was not

available yet.

viii

Indicator 16 : Cargo handled at KJIA (tons).

Value

(quantitative

or Qualitative)

278,000 383,000 383,000 260,000

Date achieved 12/31/2007 12/31/2012 12/31/2015 12/31/2014

Comments

(incl. %

achievement)

Indicator not achieved (-6.5%). According to the statistics from the KAA, cargo

handled at JKIA had a peak of 290,000 ton in 2011 and decreased since 2012 due to

external factors.3. The information for 2015 was not available yet.

Indicator 17 : KCAA meets ICAO and US FAA Category 1 safety requirements.

Value

(quantitative

or Qualitative)

None 100% 100% 100%

Date achieved 04/30/2004 12/31/2007 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Following the revenue gains, KCAA increased the

number of airworthiness and flight operations inspectors from 3 to 18 and 1 to 16,

respectively. KCAA expected to obtain IASA category 1 in the next audit in 2016.

Indicator 18 : The International Maritime Organization (IMO) and the Northern Corridor Transit

and Transport Agreement (NCTTA) certify compliance with respective treaties.

Value

(quantitative

or Qualitative)

None 100% 100% 100%

Date achieved 04/30/2004 12/31/2007 12/31/2013 12/31/2015

Comments

(incl. %

achievement)

Indicator achieved (100%). Kenya is listed as a white list country for

implementation of the International Convention on Standards of Training,

Certification, and Watch keeping for Seafarers of 1995. Kenya is in compliance

with the NCTTA provisions.

Indicator 19 : Bridges repaired and functional.

Value

(quantitative

or Qualitative)

0 3 DROPPED n.a.

Date achieved 04/02/2009 12/31/2010 12/27/2012

Comments

(incl. %

achievement)

Indicator was dropped in the 2012 restructuring.

G. Ratings of Project Performance in ISRs

No. Date ISR

Archived DO IP

Actual

Disbursements

(USD millions)

1 11/11/2004 Satisfactory Satisfactory 6.50





6 12/29/2006 Moderately Satisfactory Moderately Satisfactory 8.00

3 http://www.businessdailyafrica.com/Dimethoatel-ban-hits-vegetable-exports-to-the-EU-market--/-/539546/1694416/-

/tf5vd1z/-/index.html. External factors such as the strengthening of European Union regulations on prohibiting fresh

products with excess level of pesticide (Dimethoate) are considered the main reasons.

http://www.businessdailyafrica.com/Dimethoatel-ban-hits-vegetable-exports-to-the-EU-market--/-/539546/1694416/-/tf5vd1z/-/index.html


ix



9 06/26/2008 Moderately Satisfactory Moderately Satisfactory 64.10







16 03/11/2012 Satisfactory Moderately Satisfactory 219.32


18 05/15/2013 Satisfactory Moderately Unsatisfactory 277.08

19 11/29/2013 Satisfactory Moderately Unsatisfactory 314.30




23 11/19/2015 Moderately Satisfactory Moderately Unsatisfactory 468.57

H. Restructuring (if any)

Restructuring

Date(s)

Board

Approved

PDO Change

ISR Ratings at

Restructuring

Amount

Disbursed at

Restructuring

in USD

millions

Reason for Restructuring &

Key Changes Made DO IP

12/14/2005 N S S 6.72

Restructured to change the

expenditures to be financed by

IDA under Roads Components

from 75 percent to 67 percent

and restructured project

component, support to KAA:

Cancelled the renovation of Old

Embakasi Airport (Nairobi)

instead expanded the JKIA, by

building fourth terminal.

04/02/2009 Y S S 103.19

Additional Financing (AF) to

meet a financing gap to complete

the original activities and to

implement a new component for

the rehabilitation and

replacement of infrastructure and

public assets damaged as a result

of post-election violence.

The closing date was also

extended by three years from

December 31, 2009 to December

31, 2012.

12/27/2012 N S MS 246.27

Level II restructuring as an

exceptional extension of the

project closing date by 36

x

Restructuring

Date(s)

Board

Approved

PDO Change

ISR Ratings at

Restructuring

Amount

Disbursed at

Restructuring

in USD

millions

Reason for Restructuring &

Key Changes Made DO IP

months to complete the on-going

activities that were delayed

because of factors external to the

operation and outside of the

control of the borrower. The

closing date was also revised to

December 31, 2015.

Note: MU = Moderately Unsatisfactory; S = Satisfactory.

If PDO and/or Key Outcome Targets were formally revised (approved by the original approving

body) enter ratings below:

Outcome Ratings

Against Original PDO/Targets Satisfactory

Against Formally Revised PDO/Targets Satisfactory

Overall (weighted) rating Satisfactory

I. Disbursement Profile

1

1 Project Context, Development Objectives and Design

1.1 Context at Appraisal

1. When the Northern Corridor Transport Improvement Project (NCTIP) was under

preparation, the new government of Kenya (GoK), which was installed in December 2002,

launched its Economic Recovery Strategy for Wealth and Employment Creation (ERSWE)

for the period 2003–07 to respond to weakening economic growth, low productivity, and high

unemployment. The GoK’s main objectives in the transport sector were to encourage the

private sector to lead economic growth through reducing the cost of doing business in Kenya

and to increase its competitiveness in domestic, regional, and international markets. Provision

of reliable and least-cost infrastructure services, particularly roads, power, water, and

communication was a key component of the new strategy.

2. The GoK established the Road Maintenance Levy Fund in 1993 to secure resources

for maintenance of the road network and established the Kenya Roads Board (KRB) in 1999

to oversee the road network and coordinate its development, rehabilitation, and maintenance.

The GoK also attempted to control axle loads along major corridors. Despite the institutional

development, policy, and funding instruments for the road sub sector, development of the

transport sector as a whole still suffered from numerous constraints at the time of appraisal:

particularly, inadequate funds, institutional inefficiencies, weakness in the policy, legal and

regulatory environment, poor safety and security standards at the airport and port, and

inadequate institutional capacity and human resources.

3. The project was consistent with two key areas of the World Bank Country Assistance

Strategy (CAS) placed in 2004: (a) strengthening public sector management and

accountability; and (b) reducing the cost of doing business and improving the investment

climate. The project was also consistent with the Kenya Transport Sector Memorandum of

2003 which was a Bank-financed Analytical and Advisory Activity to build the outline of an

infrastructure strategy and policy direction. The Memorandum identified adequate routine

and periodic maintenance, cost effectiveness of civil works, and institutional reforms seeing

or all critical to Kenya’s economic development.

1.2 Original Project Development Objectives and Key Indicators

4. As stated in the data sheet, the Project Development Objectives (PDOs) in the original

Development Credit Agreement (DCA) were “to enhance the efficiency and effectiveness of

the Borrower’s transport sector through: (a) increasing the efficiency of road transport; (b)

enhancing aviation safety and security to meet international standards; and (c) promoting

private sector participation in the management, financing, and maintenance of road assets”.

These PDOs were formulated slightly different in the Project Appraisal Document (PAD)

without any significant discrepancy but providing relative weights: 60 percent for road

transport efficiency, 30 percent for civil aviation safety and security enhancement, and 10

percent for private sector promotion.

5. The PDO outcome indicators in the DCA were as stated in the data sheet with

marginal differences from those in PAD. As indicated in the Implementation Completion and

2

Results Report (ICR) guidelines4, the indicators in the DCA are used in the ICR. The key

performance indicators for each component of the project are detailed in section F of the data

sheet along with discussions in section 3.2.

1.3 Revised PDO and Key Indicators, and reasons/justification

6. Additional International Development Association (IDA) credit was approved in

April 2009. The original PDOs were revised by adding one more PDO: (d) restoring vital

public infrastructure and assets damaged as a result of the December 2007 post-election crisis

to respond to the government’s urgent appeal to IDA to support the implementation of the

post-election recovery program (adaptive restructuring). The other three original PDOs

remained unchanged though additional or expanded activities were included in Components

A, C, and E, and Component F was restructured. Relevant weight of 60 percent for road

transport efficiency has been modified to 58 percent and 2 percent weight was given to the

newly added PDO.

7. To measure achievement of the additional element of the PDO, the Additional

Financing (AF) added one additional PDO indicator: “Vital public infrastructure and assets

destroyed or damaged during the post-election crisis are restored and functional again”.

Similarly to the other PDO indicators, the Financing Agreement and the AF project paper

worded this indicator slightly differently.

1.4 Main Beneficiaries

8. The project papers do not have an explicit section to describe the main beneficiaries

of the project. However, the economic analysis of road sector in PAD and the AF identified

that the main benefit of the project is ‘savings made by road users’. In addition to the road

users, from the statement of PDOs, airport users, private sector, as well as institutions of road

and civil aviation sub-sectors are considered main beneficiaries of the project.

1.5 Original Components

9. The NCTIP had originally three funding sources. The IDA credit (39300-KE) of

US$207 million, the Nordic Development Fund (NDF) loan of US$15.23 million (€12

million), which was parallel financing, and the GoK’ s contribution of US$54.26 million,

totaling US$276.49 million.

A. Rehabilitation of the Northern Road Corridor. (IDA US$134.59 million, total

US$190.46 million)

10. Strengthening and rehabilitation of about 373 km of selected priority road sections

along the Northern Corridor; improvement of the North Airport Road connecting the

Mombasa Highway to the Old Embakasi Airport (about 8 km); and consultant services for

supervision works.

4 p16 Guideline for reviewing World Bank Implementation Completion and Results Reports, updated on August 1, 2014,

IEG and p58 Implementation Completion Report Guidelines, OPCS, Aug 2006, last updated July 22, 2014

3

B. Socio-economic Enhancement, Roadside Amenities and HIV/AIDS Mitigation. (IDA

US$3.62 million, total US$4.35 million)

11. Construction of proper bus and truck stops at key selected locations, and off-road

booths for sale of local produce, and specific interventions along the Northern Corridor to

mitigate HIV/AIDS, such as awareness campaigns, distribution of condoms, strengthening

of local health centers as needed, voluntary counseling and testing, and support and care for

affected persons.

C. Private Sector Participation in Road Management and Maintenance. (IDA US$8.68

million, total US$10.66 million)

12. Provision of technical assistance to (a) facilitate the concessioning of selected

sections of the Northern Corridor road link; and (b) implement a pilot program of long-term

output and performance based maintenance and management of a selected sub-network

(about 300 km) of lower volume roads.

D. Road Safety Improvement. (IDA US$ 4.82 million, total US$4.96 million)

13. Provision of consultant services to prepare and implement a program of specific

actions designed to reduce the number of road accidents and fatalities.

E. Institutional Strengthening in the Roads Sector and Technical Assistance. (IDA

US$8.24 million, total US$11.46 million)5

14. Provision of technical assistance and training to enhance institutional capacity and

support policy reforms in the road sector, including establishment of an autonomous

National Highways Authority. This component also includes provision of consultant

services for design, engineering and preparation of bid documents for selected road projects.

F. Support to the Kenya Airports Authority. (IDA US$34.82 million, total US$41.91

million)

15. Financing of civil works, consultant services, purchase of equipment, IT support and

training to improve the operations, search and rescue capacity, and the safety and security

standards at the Jomo Kenyatta International Airport (JKIA), Mombasa Moi International

Airport, Wilson Airport, Kisumu Airport and other selected minor airports.

G. Support to the Kenya Civil Aviation Authority. (IDA US$10.02 million, total US$10.21

million)

16. This includes: (a) technical assistance for safety inspection, training, implementation

of Global Navigation Satellite System/Global Positioning System (GNSS/GPS) for en route

and approach procedures at minor airports; and (b) support to the East African School of

Aviation (EASA) for training of trainers, purchase of training equipment for airworthiness,

air traffic control systems, and engineering services, as well as an air accident investigation

laboratory.

H. Support to the Ministry of Transport and Communication. (IDA US$2.20 million, total

US$2.48 million)

17. This includes strengthening of the Ministry of Transport and Communications

(MOTC) through purchase of equipment, support to Bandari College, technical assistance,

5 Cost includes project operation cost of MoTI, US$1.1 million.

4

and training, and sector studies related to maritime laws and regulations, implementation of

the new transport sector policy and regional trade and transport facilitation.

18. In the rehabilitation of roads, 98 percent of design and supervision was to be funded

by IDA, while civil works were to be co-funded by the GoK and IDA at 25 percent and 75

percent, respectively. For the airport expansion and facility improvement, 94 percent of

consultant services was to be financed by IDA, and the civil works were to be co-funded by

the GoK and IDA at 26 percent and 74 percent, respectively.

1.6 Revised Components

19. Change in Financing Parameter and the revision of Project Component. On

December 14, 2005, Office Memorandum for change in the financing parameter for Civil

Works (Roads Component) and revision of the Component to support the Kenya Airports

Authority (KAA) was approved. The PDOs remained same and the DCA was amended as

follows:

Cancel the renovation of Old Embakasi Airport (Nairobi) and Paragraph 1 in Part F

of Schedule 2 to the Agreement is amended to read “Rehabilitation and

reconfiguration of the main terminal at Jomo Kenyatta International Airport and

construction of a new terminal 4; with corresponding reallocation of the credit

proceeds; and

Increase in the government’s counterpart share of financing for road works from 25

percent to 33 percent, and reducing the IDA share from 75 percent to 67 percent.

20. Additional Financing. The Board approved an additional IDA credit of US$253

million (45710–KE) entirely toward the road sub-sector for unfunded road sections and

deepening the reforms and Governance and Anti-corruption Action plan that was agreed

between the GoK and the Bank. The NDF financing increased by €4 million, totaling €16

million, which was equivalent to US$19.19 million. Due to changing in the financing

proportions, counterpart funding increased by US$286.35 million, totaling of US$340.64

million. In addition, US$100 million from other sources6 was included in the financing plan

and the overall revised project coast was US$919.83 million. The Results Framework was

also revised with additional indicators.

21. The AF added the implementation of Road Sector Governance and Integrity Action

Plan (RSGIAP) as a requirement. The RSGIAP included new steps and measures to improve

transparency and accountability such as the introduction of new and additional clause in the

road works contracts permitting the GoK and/or the World Bank to terminate any of these

contracts in the event that the winning contractors were debarred by the Sanctions Board of

the World Bank Group. The early termination clause was and remains an exception to Bank

policy. As the result, the NCTIP expanded its target to tackle with full-scale road sub-sector

reform.

22. Revised components of the projects under the AF were as follows: (a) AF to cover

the shortfall in financing of three original components, Components A, C and E, including

the expanded or new activities within the components; and (b) restructuring of Component

6 Financiers under consideration included European Investment Bank and Kenya Local Banks

5

F without AF from IDA. The rest of the original components, Components B, D, G and H

remained unchanged. Details of the revision are described below:

Component A: Rehabilitation of Northern Corridor and Emergency Rehabilitation

(US$318.41 million cost increase; additional IDA financing of US$220.43 million)

23. The AF covers unfunded rehabilitation and improvement of three road sections: Mau

Summit-Kericho, Kericho-Nyamasaria, and Nyamasaria-Kisumu Airport-Kisian, totaling

158 km. In addition, a new sub-component was the repair and replacement of roads and

bridges damaged or destroyed by floods in late 2006 and early 2007, and restore other public

infrastructure assets including buildings, vehicles, and equipment damaged following the

general elections in December 2007.

Component C: Private Sector Participation in Road Management (US$12.70 million cost increase; additional IDA financing of US$8.82 million)

24. Additional cost has been allocated to the existing two sub-components.

Component E. Institutional Strengthening in the Roads Sector and Technical Assistance.

(US$24.24 million cost increase; additional IDA financing of US$23.75 million)

25. In addition to the existing studies, design studies for the Sudan Link road and the

Urban Public Transport Improvement study in Nairobi were added to this component. A new

sub-component, Strengthening Governance in the Road Construction Industry, was added

with the following activities: (a) establishing a road infrastructure disaster management and

response unit within the Kenya National Highways Authority (KeNHA); (b) establishing a

National Construction Authority (NCA) to promote and oversee professional and ethical

conduct in the construction industry; and (c) strengthening the Engineers’ Registration Board

(ERB) and its associated institutions, including the Institution of Engineers of Kenya.

Institutional strengthening within the existing component was also scaled up under the AF.

Component F. Support to the Kenya Airports Authority 26. Component F was restructured, without any AF from IDA, as follows:

(a) Cancel the rehabilitation of the Old Embakasi Airport;

(b) Introduction of new project activities for: (i) the expansion of JKIA, including

construction of a new passenger terminal building (unit 4), a car park, and

reconfiguration of terminals 1, 2, and 3, and (ii) the supervision of expansion works

at JKIA Units 1-4 and arrivals building;

(c) Reallocation of the following IDA funds to the expansion of JKIA: (i) terminal

construction and extension of the runway at Kisumu Airport, (ii) renovation of the

terminal and upgrading of security at Wilson Airport, and (iii) rehabilitation of the

Old Embakasi Airport;

(d) Reduction of IDA’s financing percentage for civil works at JKIA Unit 4 and car park

from 25 percent to 19 percent; and

(e) Consolidation of the subcomponents for security perimeter lighting, surveillance

system, and support to emergency centers into the subcomponent for security and

communications equipment and vehicles, and adjustment of funds for feasibility,

design, and supervision of Kisumu and Wilson Airport reconfiguration and training.

6

1.7 Other significant changes

27. Restructuring. In addition to the changes in financing parameter and the revision of

project component in 2005 and the AF, the project had a level II restructuring in December

2012. This was an exceptional request to extend the closing date of both original and

additional credits by 36 months to complete the on-going activities. Delays were partially

due to the implementation of RSGIAP. Since the sector wide reform was not anticipated

originally, due to the factors external to the operation and outside of the control of the

Borrower, extension was requested. Reallocation of funds among various categories of the

NCTIP was also included in the restructuring.

28. Parallel Financiers. The French Development Agency (Agence Française de

Développement, AFD) (new credit, US$93 million) and European Investment Bank (EIB)

(new credit, US$93 million equivalent) decided to provide parallel finance to the NCTIP,

which became effective in 2011. The AFD supported the construction of Unit 4 terminal

building and car parking garage of JKIA and the activity has completed successfully7. On

the other hand, the EIB was to finance the remodeling of JKIA terminals but decided to

cancel its finance due to considerable delays and the needs to retrofit the expansion plan at

JKIA following the fire tragedy in 2013 that destroyed part of the facilities which had been

earmarked for remodeling. Since the GoK has not made the final decision on the remodeling

of terminal 1-B, C and D, this activity has been on hold.

29. Government Restructuring. With the ratification of new Constitution in 2010,

transport sector under Ministry of Roads, Public Works and Housing and Ministry of

Transport and Communications were merged under one ministry, Ministry of Transport and

Infrastructure (MoTI). MoTI has State Department of Transport and State Department of

Infrastructure.

2 Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry

30. The project quality at entry is rated Moderately Satisfactory. The project was

designed in a client-oriented manner, responding to the government’s priorities set in the

ERSWE and gaps identified by the ongoing transport sector reform task force, and aligned

with the support areas identified under the CAS (2004-2007) as well as the Transport Sector

Memorandum. The project embraced a holistic approach to support policy formulation and

project implementation in various transport subsectors, including regional security and

tourism perspectives and its impact on the economic development of the country. Significant

weight was given to strengthening the institutional structure in the road subsector.

31. Adequacy of government support on project preparation. The GoK had taken

numerous steps to reform the entire transport sector since the 1990s, such as establishment

of the Road Maintenance Fuel Levy Fund and KRB, improvement of axle load control,

setting up of a national taskforce, the enactment of the Civil Aviation Act to establish an

autonomous Kenya Civil Aviation Authority (KCAA), privatization of Kenya Airways, and

so on. At appraisal, the GoK had set up a high level task force to review the existing structure

7 Final financing shares for unit 4 terminal and car parking are: IDA (11 percent), AFD (71 percent), and GoK (18

percent).

7

of roads department.

32. Well selected project components. The Bank team had extensive discussions with

both the GoK and development partners to finalize project components and increase

coordination in the sector. Although the project covered various transport subsectors, which

could increase the risk of poor performance by increasing the project’s complexity, the Task

Team deemed it necessary to propose a holistic approach to the GoK based on their

assessment of the ongoing sector reform and government commitment. Importance was

given to Bank policies, specifically social and environmental safeguards (resettlement and

HIV/AIDS mitigation, roadside amenities, and so on), some of which were new to Kenya.

The financial management (FM) and procurement capacity of the implementing agencies

(IAs) was reviewed, and possible funds flow and disbursement regimes were identified and

agreed at the preparation stage. One component of the project concentrated on the

improvement of the road safety.

33. Built on the lessons learned from previous transport sector reforms in the Region.

The World Bank accumulated considerable knowledge and experience in transport sector

reform in the region through Sub-Saharan Africa Transport Policy Program. Specifically,

the framework developed under the Road Management Initiative would inform efforts to

improve the institutional and financial sustainability of road management. Based on

previous road sector projects, the project was designed to ensure ownership of the project,

emphasize capacity building, incorporate an “all-inclusive” Project Technical Team (PTT),

and include adequate and secured domestic funding in project-financed infrastructure

maintenance.

34. Assessment of project design and Results Framework. The PDOs of the project were

clear. Importance of project components to the PDOs was mostly evident but the causal

chain between Components B, D, E, and H and PDOs was vague (see section 2.3). Since the

project supported a transport sector reform in addition to the infrastructure development, the

original project life of five years underestimated the complexity of and necessary time for

sector reform to attain a sustainable level.

35. Assessment of risks and mitigation. Overall risk rating at appraisal was ‘Substantial’

with one element related to the PDO, and three elements related to component results rated

‘Modest’. Most of the potential risks were identified and mitigation measures were prepared,

but the following two potential risks were not identified: (a) institutional sustainability, and

(b) effective monitoring and evaluation (M&E) mechanisms. Because the project was to

support the establishment of a new highways authority, a strategic approach would be

required for the sustainability of such an authority in terms of funding and human resources.

In addition, the project was to set up an innovative approach in M&E, outsourcing the task

to a local academic institution that had no experience in M&E of large infrastructure

investment projects. Therefore, there was uncertainty about the quality of outputs and extra

attention was required in order to ensure adequate implementation. There was no potentially

controversial aspect identified at the appraisal stage of the project.

8

2.2 Implementation

36. The key issues affecting project implementation were the change of leadership, post-

election crisis, regional security deterioration, floods, cost increase, late release of payment,

inadequate counterpart funding, poor project management of civil works, the review of road

sector procurement, and RSGIAP. Between the start of the project in September 2004 and

July 2011, most Implementation Status and Results reports (ISRs) rated project performance

‘Satisfactory’. Project performance was rated ‘Moderately Satisfactory’ twice between 2006

and 2011, first when significant delays were noted due to changes in the project technical

team leadership (road subsector) in 2006 and second the post-election violence in 2007/8.

The Mid-Term Review (MTR) in 2009 noted the satisfactory project progress with

completions of Maji Ya Chumvi-Miritini road section and security fencing of JKIA, and

substantial completion of Lanet - Njoro Turn Off road section. The MTR explained the low

disbursement at the initial stage was attributed to prolonged delays in start-up activities.

Starting 2012 to the closing of the project, ISR rated the implementation ‘Modestly

Satisfactory’ or ‘Moderately Unsatisfactory’ mainly because of late release of payment and

lack of counterpart funding. This section will discuss both positive and negative factors that

affected the project implementation.

37. Government commitment to sector reform enabled the successful implementation of

this complex project with multi IAs from different transport sub-sectors and under three

different administrations over the project cycle. Enactment of the 2007 Kenya Roads Act

and creation of three road authorities in 2008 were realized one year before the revised

target. The KCAA and KAA also became financially independent through the structural

reform of agencies. The National Transport and Safety Authority (NTSA), NCA and the

Engineering Board of Kenya (EBK) were established in 2011/12 through the enactment of

designated acts. The Project Coordinating Team had quarterly meetings where IAs shared

and discussed progress and implementation issues. Quarterly meetings also contributed to

the enhancement of communication and coordination among IAs, providing a platform for

discussions, and boosted supports for an integrated transport approach in Kenya. The project

coordination was further improved after the MoTI assigned the current project coordinator.

38. The NCTIP suffered from unexpected negative factors, such as a sharp increase in

the price of key construction material in the international market, post-election violence in

2007/08 and deterioration of regional security due to terrorist attacks since late 2011. Soon

after the approval of the project, the prices of key construction materials in the international

market increased, particularly steel, fuel and bitumen resulting in high bid prices of the civil

works contracts. Post-election violence displaced about 350,000 people8 and led the NCTIP

to suspend operations in several locations due to temporal unavailability of labor. The

increased security risk in the region suspended the realization of direct flights to/from JKIA

and U.S. airports approved by the Transportation Security Administration of the United

States (TSA) in 2009 and required a higher level of security facilities at the major airports

in Kenya. The number of international passengers at JKIA that had increased steadily since

1998, decreased 5 percent in 2013, compared to a peak in 2011.

39. Prolonged project life was partially due to the detailed reviews in Kenya conducted

by the Department of Institutional Integrity (INT) and the introduction of the RSGIAP

8 https://wikileaks.org/wiki/Full_Kenyan_post_election_violence_report_2008

9

imposed by the AF. Concerns about integrity issues and to increase transparency and

accountability in the road sub sector led INT to conduct detailed implementation reviews of

on-going projects in Kenya, including the NCTIP during 2005-07. This review put on hold

the implementation of project activities. The INT also conducted reviews of some of the

bidders for three project road sections 9 in 2008, which caused further delays in the

processing of the AF and start-up of execution of road contracts. Implementation of RSGIAP

required both the Bank and the GoK to undertake additional due diligence, such as reviews

of the winner of bids. The full-scale sector reform necessitated more time than anticipated.

40. A unilateral change in the leadership of the PTT (road sector) in 2006 without

consulting the Bank also caused a delay in start-up activities of road construction work.

Changing the leadership without consulting the Bank was in contravention to the legal

agreement. After the protracted discussions with the GoK, the Ministry of Roads, Public

Works, and Housing (MoRPWH), Ministry of Finance (MoF), and the Bank signed the

Memorandum of Understanding on transitional arrangements for the proposed change in the

MoRPWH PTT, which provided the way forward.

41. Slow progress of civil works due to contractors’ poor project management and

inadequate deployment of resources had serious impact on the project implementation.

KeNHA issued warning letters to the contractor of road sections: Mau-Summit-Kericho,

Kericho- Nyamasaria, Sultan Hamud-Machakos Turn off, and Machakos Turn off-JKIA,

and requested a supervision engineer to intensify monitoring with preparation of a quarterly

work program including specific outputs for each month. At the same time, it was agreed

among KeNHA, the supervision consultant and the contractor to review the contract if the

progress remains slow.

42. KeNHA applied liquidated penalties for the section of Machakos Turn off-JKIA,

which took twice as much time than originally projected. Since the contractor contested this

action, this dispute was brought to the Permanent Court of Arbitration in The Hague. Based

on the recommendations from the Dispute Resolution Expert (appointed by the Court), both

sides agreed on an amicable settlement. Intensive monitoring after this dispute contributed

to the improvement of the progress of the construction work.

43. Insufficient counterpart funding and delays in payment processing were serious

challenges. Adequate and timely counterpart funding was reported during the first phase of

the project but after approval of the AF, securing the counterpart funding became a serious

and systemic issue, specifically in the last two years of the project. In addition, the slow and

duplicative payment procedures of the ministry delayed the settlement of payment

certificates. The delays in commencement of road sections of Mau-Summit-Kericho and

Kericho-Nyamasaria were caused by a lack of counterpart funding for the advance

payment. 10 The outstanding payment and uncertainty of future payments from the

counterpart resulted in the suspension of construction for the sections of Sultan Hamud-

Machakos Turn off and Machakos Turnoff-JKIA for some time. Payment of interest due to

the delays in payment was also a significant burden to the GoK. 11 Prioritization of

9 Mau Summit-Kericho; Kericho-Nyamasaria; and Nyamasaria-Kisumu-Kisian 10 It is recorded that no objection from the World Bank to award these contract was issued on October 2009, but the

construction commenced only in October 2010. 11 KSh 158.5 million in interest is recorded in December 2013.

10

implementing the New Constitution ratified in 2010 was another factor.

44. To cope with inadequate counterpart funds, the GoK requested the Bank to allow for

100 percent IDA financing for the road works contract starting FY 13/14 until the IDA fund

was exhausted. This contributed significantly to the improvement of disbursement and

progress of civil works. The Bank also recommended in 2014 that the National Treasury

issue clear guidelines on securing budgets of donor funded projects. The guidance was

finally issued in September 2015, and disbursement of funds and payments to contactors

resumed in December 2015. At the ICR mission in February 2016, there was KSh 2.9 billion

outstanding payments for the road works to be paid from counterpart funds by June 2016

and the National Treasury assured the availability of this budget.

45. The increase of cost let the GoK to request AF in 2008. The main causes of cost

overruns were due to: (a) significant escalation in input unit costs in the international market;

(b) higher traffic growth than expected, resulting in upgrading to the road design; (c)

significant deterioration in the project road sections, aggravated by the floods in 2006/07,

which resulted in greater than expected rehabilitation costs; and (d) additional costs incurred

for supporting post-election reconstruction. An assessment of unit construction costs in

neighboring countries, such as Uganda, Ethiopia, Tanzania, and Mozambique, undertaken

at the time of the AF found that unit cost increase under the project reflected regional and

global market movements and no abnormality was found.

46. As stated above, a rapid growth in traffic volumes on the corridor forced KeNHA to

increase the scope of the original intervention. The number of vehicles in the major cities

nearly doubled between 2003 and 2007, and the strong traffic growth continued throughout

the project life: The annual average daily traffic (AADT) on eight project road sections

varied from about 4,400 to 25,300 in 2014/15, compared to 2,000 to 12,000 in 2003 with an

average annual growth rate of 8.1 percent. 12 Between 2003 and 2014, the number of

registered vehicles in Kenya increased by about 1.56 million13 while the total number of

registered vehicle in Kenya in 2013 was 2.01 million.14

47. Based on the above discussions, the overall implementation of the project, including

the compliance with both the original credit and the AF is rated Moderately Satisfactory.

2.3 Monitoring and Evaluation Design, Implementation and Utilization

48. M&E design. As noted in section 2.1 the PDOs are clear, but slightly differed

between the PAD and DCA, and the indicators of several components did not reflect the

objectives directly. Attaining road sub sector reform was one of the important targets of the

project but there was no PDO indicator to address this challenge. The AF supported the

further expansion of JKIA and added intermediate outcomes as well as indicators to measure

the capacity expansion of JKIA, which was different from security and safety enhancement.

However, PDO2 for aviation remained unchanged, and the causal chain between the PDO

and the additional expected component outcome became unclear. In addition, measuring

methods for some indicators were not feasible, for example, ‘legislation enacted for private

12 KeNHA: NCTIP Project Completion Economic Analysis Summary, April 2016 13 Kenya Facts and Figures, Kenya National Bureau of Statistics. 14 WHO: Global Health Observatory data repository

11

sector participation in road’, and ‘compliance with respective treaties’, cannot be measured

as a percentage.

49. The Results Framework prepared under the NCTIP was designed to be monitored by

a team of experts from the University of Nairobi Enterprises and Services Limited (UNES),

and the baseline survey was completed in 2007. While responsible agencies were assigned

for data collection, UNES was to consolidate and analyze the data. The approach to utilize

a local academic institution was innovative, and positive impacts on the institutional

capacity were observed, supporting more than 50 post-graduate students and a PhD

candidate majoring in transport and setting up a transport data bank in the university. This

arrangement is currently adopted by ongoing Bank-supported transport projects in Kenya.

50. Due to rapid motorization during the project period, there is a high risk of worsening

traffic congestion in urban centers along the Northern Corridor. Since this risk directly

affects the total travel time, this should have been identified and reviewed at the AF or at

restructuring, including the travel time of individual road sections to the PDO indicator. The

distance between Mombasa and Malaba/Busia is about 930 km and to achieve the target

travel time, trucks, cars, and buses need to maintain an average speed of 52 km/h, 85 km/h,

and 69 km/h, respectively. Thus, this target travel time was rather ambitious with respect to

the speed limit within towns and for specific vehicles set by the Traffic Act of Kenya.15 This

aspect needed to be considered as the Bank is a leading institution for road safety.

51. M&E Implementation. In spite of the high sustainability of the M&E arrangement

with an institutionalized system, the following challenging were observed in M&E

implementation: (a) long delays in contracting the UNES (contract was signed in early 2006)

and amendment of contract duration; (b) delays in data collection and reports, specifically

starting 2011; and (c) quality of M&E reports. During the ICR mission, lack of

understanding of the tasks of the M&E consultant was observed and missing project

indicators in the M&E reports were addressed though it was confirmed that each IA has

collected accurate and relevant data. The issue was not the credibility of available data, but

the inefficient M&E process (collecting and analyzing data), which was also addressed by

the IAs and stakeholders. The ICR team therefore directly obtained most of the data from

IAs and stakeholders.

52. It is also noted that the monitoring of agreed indicators by the Bank team was

inconsistent and indicators different from the Results Framework were sometimes recorded

in the ISRs. Some indicators, such as reduction in road-related fatalities, implementation of

the RSGIAP, road user perception and satisfaction, and so on, have been hardly explained

in the ISRs or Aide Memoires. Achievement of the target of 25 percent reduction in travel

time, which is one of the outcome indicators, has been reported in ISRs and Aide Memoires

repeatedly but the data source was not confirmed under the ICR process. Likewise, apart

from the obtainment of the TSA security clearance, further details should have been

provided related to the United States Federal Aviation Administration (FAA)/International

Aviation Safety Assessment (IASA) Category 1 (CAT1), which was not achieved at the end

of the project, whereas it was also an important outcome indicator.

15 The Traffic Act of Kenya defined that the maximum speed of a vehicle in a town is 50 km/h. To travel from Mombasa

to Malaba (930 km) in 11 hours requires an average speed of 85 km/h.

12

53. M&E Utilization. During the implementation of NCTIP, utilization of M&E was

partial because of discrepancy of indicators, inadequate analysis on M&E, and delayed

submission of M&E reports. After the closing of the project, a workshop to present the

achievements and lessons learned of the NCTIP was held on March 13, 2016. It presented a

good opportunity for stakeholders to review the achievements of the project and utilize the

information collected. There were useful comments from stakeholders to improve the M&E

of the project. It was unfortunate that there was no other workshop during the

implementation of the NCTIP to discuss the project progress with the stakeholders based on

the Results Framework of the project.

54. M&E collaboration with the Northern Corridor Transit and Transport Coordination

Authority16 (NCTTCA) under the NCTIP was not as strong as the project aimed. The limited

resources and manpower of NCTTCA were noted at the entry, but the Authority currently

monitors 30 performance indicators along the corridor separately prepared under one of its

program areas and has established the Northern Corridor Transport Observatory on their

website which presents the monitoring results in a timely manner. Since their monitoring

coverage is getting wider and more comprehensive in recently years, it is expected that

performance of the corridor will continue to be monitored after the end of the project.

55. In conclusion, the Bank has raised concerns on the M&E implementation, but it

could have intervened in this matter more proactively, considering the importance of M&E.

Gaps observed in the project M&E design and implementation reflect enhanced M&E

quality and effectiveness as a lesson learned for future projects.

2.4 Safeguard and Fiduciary Compliance

56. Safeguard. Based on the project implementation review by the safeguard and natural

resource management specialists, the safeguard policies triggered during project preparation

were found adequately covering the impacts and risks of the implemented subprojects. The

NCTIP was designated as an Environment Category ‘B’ project-a partial assessment.

Environmental Assessment (OP/BP 4.01) and Involuntary Resettlement (OP/BP 4.12) were

triggered by the project. Resettlement Policy Framework was reviewed and cleared by the

Bank and disclosed to public (InfoShop) on January 14, 2004. Based on the Framework,

Resettlement Action Plans (RAP) were prepared for all road work contracts and in total

1,055 project affected people were compensated under the NCTIP. KeNHA carried out land

acquisition for five road sections between 2010 and 2015 with the total amount of KSh 946

million without experiencing any substantial delays in civil works.17 KeNHA assigned

environmental and social specialists to the project. KAA also carried out land acquisition

satisfactorily for upgrading Kisumu Airport except one landowner who refused to move.

The key safeguard challenges in the operation are summarized in the table 1.

57. Road-side amenities and social and economic enhancement component, including

HIV/AIDS mitigation has been successfully completed with positive impacts as discussed

in section 3.5. As the follow up matters, the RAP completion reports and rehabilitation of

16 The NCTTCA was established under the legal framework of the Northern Corridor Transit Agreement to co-ordinate

implementation of the Agreement and to carry out decisions and resolutions reached by policy organs of the Authority. 17 For the sections of Maji ya Chumvi-Miritini and Sultan Hamud-Machakos Turnoff, no specific issue of land acquisition

has been observed but the detailed information is not available in KeNHA since the constructions were undertaken by the

Ministry before the establishment of KeNHA.

13

borrow pits and stone quarries are required while close monitoring of the allocation of the

trading stalls or units in Awasi market upon the completion of construction is necessary.

Table 1. Safeguard policies triggered by the NCTIP and implementation challenges

Safeguard policy triggered

by NCTIP

Implementation challenges

OP/BP 4.01 Environmental

Assessment Construction related impacts;

Safety of construction sites (speed control);

Timely quarry rehabilitation and closure.

OP/BP 4.12 Involuntary

Resettlement Compensation of project affected people without legal rights,

e.g. open air market traders with make-shift structures;

No clear guidelines on livelihood restoration;

Most of the road reserves encroached upon;

Setting up of cut-off date due to difficulties of controlling the

influx of people;

Political interferences;

Speculative development along the project area;

No clear national policies on RAP;

Issues of land ownership and documentation (succession issues

leading to litigation);

Lack of adequate funds for timely RAP implementation.

Access to Information Policy n.a.

58. Financial management. The project complied with the financial covenants stipulated

in the Financing Agreement. All the quarterly unaudited and the annual audited financial

reports were received. Some of the clarifications requested by the audits were mainly related

to delays in project implementation and outstanding bills that attracted interest and penalties.

The main challenges during implementation were inadequate provision of budget against

the submitted annual estimates that in turn affected the releasing exchequer. Delays in fund

flows were also experienced especially by the parastatals. The delays could be traced either

at the National Treasury or at the line ministry. The weak capacity of staffing and frequent

transfer of accountants at the line ministry also affected the efficiency of project operation.

However, the IAs has built overall capacities in FM over the years.

59. Procurement. Overall procurement performance under the project was rated as

Satisfactory. At the initial stage of project implementation, slow and unsatisfactory

procurement process was noted in the road subsector due to the transferring of functions

from the ministry to the newly established KeNHA. However, KeNHA increased its

procurement capacity rapidly through institutional strengthening and technical assistance of

the NCTIP, and the procurement plan was back on track. KeNHA is currently fully

established and staffed with qualified and experienced technical and procurement staff

though procurement capacity under Bank financed operations is still relatively low, and

specifically, contract management needs to be strengthened. KCAA, KAA, and MoTI also

completed all the contracts earmarked for implementation under the project satisfactorily.

2.5 Post-completion Operation/Next Phase

60. At closure, most of the activities were either completed or close to completion. Status

of the remaining activities at the ICR submission are as follows: The Nyamasaria-Kisumu

14

Airport-Kisian section (total 21.9 km, 8.4 km of which is dual carriage way) was completed

and handed over to KeNHA in March 2016, except the Nyamasaria-Kismu-Kisian road

section including Kisumu Bypass in which street lighting, road furniture, landscaping, foot

bridges, and construction of drains remains to be completed by July 2016. The office

rehabilitation and construction of new office buildings were completed and handed over to

the GoK in March 2016. A lorry park at Nyamasaria and a market at Awasi are expected to

be completed by September 2016. The National Treasury acknowledged the outstanding

payments and assured (ICR mission in February 2016), smooth weekly disbursement of

funds to MoTI to complete the remaining payments.

61. As a positive impact of the NCTIP, some of the rehabilitated roads under the project

are currently being maintained under the output- and performance-based road contract

(OPRC). The NCTTCA is also monitoring the performance of the corridor including the

quality of roads and traffic volume.

62. Even after the project is closed, the GoK, KAA and the KCAA are taking further

steps towards the obtainment of the FAA CAT 1 recognition: the KAA and KCAA drastically

improved its compliance rates through follow-up on the eight critical elements identified by

the International Civil Aviation Organization (ICAO). They have met the requirements for

the CAT1 clearance and expect to obtain CAT 1 certification in 2016. The key challenge for

the KCAA is to retain its inspectors through an adequate staff loyalty policy, by offering,

among others, competitive salaries.

63. Feasibility studies carried out under the NCTIP facilitated the project preparation

and financing: Implementation of Mombasa Southern Bypass is financed by Japan

International Cooperation Agency (JICA), and the design of Lesseru-Nadapal/Nakodok

Road has accelerated the preparation of the Eastern Africa Regional Transport, Trade and

Development Facilitation Project (P148853). The project was approved by the Board in June

2015 and became effective in November 2015, before the closure of the NCTIP.

64. Continuous institutional capacity building activities are undertaken by on-going

projects: National Urban Transport Improvement Project (NUTRIP, P126321) and Kenya

Transport Sector Support Project (KTSSP, P124109) have institutional capacity building

supports for the NTSA, NCA, KRB, EBK and, KCAA. KTSSP also supports capacity

building of KAA.

65. Follow up on uncompleted activities is necessary: the GoK’s decisions are awaited

for the conclusion of the development of a 50-year transport master plan, the remodeling of

terminal 1-B, C and D, and the restructuring of KCAA.

3 Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation

Rating: High

66. The project objectives and accomplishments remain highly relevant to the GoK’s

current development priorities. The GoK’s development strategy, “Vision 2030” recognizes

the transport sector as a key Pillar for development and identified the NCTIP as a flagship

project to promote trade in the East African region and enhance economic and social

integration. The PDOs remain highly consistent with the current Country Partnership

15

Strategy, contributing to two of the three focus areas: (a) “Competitiveness and

Sustainability - Growth to Eradicate Poverty”, of which a key objective is enhancing

infrastructure and logistics to promote growth, and (b) “Protection and Potential - Human

Resource Development for Shared Prosperity”.

67. The objective of improving aviation safety and security enhancement to meet

international standards remains highly relevant as travel and tourism are key elements to the

economy of Kenya 18 and East Africa, and full compliance with international aviation

standards is critical to the sustainability of Kenya’s civil aviation and tourism industries.

68. The relevance of project implementation is assessed as High. The Project Oversight

Committee (POC) and project coordinating team conducted quarterly meetings, and a

project coordinator was appointed to increase coordination among IAs. These efforts created

a platform for the sub sectors to learn from each other and for discussing the transport sector

in general. The Bank responded promptly to unexpected events such as post-election crisis,

cost increases, emerging demands for further expansion of JKIA and up-scaling the design

scope of road sections due to higher traffic growth, severe floods, and so on, by processing

the AF and restructuring the project activities and reallocating funds. Flexibility of accepting

100 percent financing from IDA allocation starting FY13 until the exhaustion of the funds

mitigated the risk arising from the lack of counterpart funding. These actions were highly

relevant as they allowed the successful completion of almost all project activities.

3.2 Achievement of Project Development Objectives

69. Overall attainment of original PDOs and revised PDOs are both considered

Substantial. The project involved the reform of the transport sector and covered multiple

subsectors of transport, including road, civil aviation, and maritime. The NCTIP introduced

an integrated approach to transport planning, which led to developing and adopting an

integrated transport policy in 2009. The project established a platform for the transport sector

through quarterly meetings to discuss transport issues in an inclusive and holistic manner.

The project has met the targets for four out of six PDO indicators, and met targets for 13 out

of 18 intermediate indicators. In addition to the outcome and intermediate indicators,

benefits associated to each PDO are considered in the assessment. The relevant importance

among four PDOs follows the order listed in legal agreements and weight given in project

papers. In summary, the NCTIP has largely achieved the PDOs. The assessment results of

each PDO are summarized below, and achievements by objective are detailed in annex 2.

Table 2. Summary of achievements of PDO indicators

Outcome Indicators Targets

Actual

Values

Percent

Achieved

Aggregate rating of Efficacy: Substantial

PDO1. Increase the efficiency of road transport (58 percent weight)

Travel time by road from Mombasa to Malaba and Busia

reduced by 25 percent

25% 15% 60%

PDO2. Enhance aviation safety and security to meet international standards (30 percent weight)

(a) KCAA is cleared as category 1 safety status under the

IASA of the US FAA

CAT 1

clearance

obtained

Not obtained

but met the

requirements

0%

18 The total contribution of Travel & Tourism to GDP was KSh561.8bn (10.5% of GDP) in 2014.

16

(b) JKIA in Nairobi is cleared by the US TSA for direct

flights to/from United States airports

Direct

flight

cleared

Direct flight

cleared

100%

PDO3. Promote private sector participation in the management, financing, and maintenance of road

assets (10 percent weight)

(c) One long term performance based road management

and maintenance contract awarded to the private sector

and is effectively under implementation

(d) One road segment along the Northern Corridor

offered for concession to the private sector

100%

100%

100%+

100%

100%+

100%

PDO4. Restore vital infrastructure and public assets damaged as a result of the 2007 post-election

crisis (2 percent weight)

Vital public infrastructure and assets destroyed or

damaged during the post-election crisis are restored and

functional again

100% 100% 100%

70. The classical aggregated evaluation is adopted for the NCTIP. Original PDOs and

outcome indicators were unchanged, and restated in the Financing Agreement of the AF.

Fourth PDO added at the AF was to respond to the post-election recovery program with an

outcome indicator specific to the PDO. In addition, low disbursement ratio at the AF (21

percent) implies that overall outcome rating would be largely affected by the attainment ratio

of all parameters after the AF. Therefore, split evaluation does not gain any merit in this ICR

to assess the achievements of PDOs.

PDO1. Increase the Efficiency of Road Transport - Rating: Substantial

71. The project has substantially achieved the first PDO by rehabilitating in total 419.3

km19 of the Northern Corridor satisfactorily, reducing travel time by 15 percent in spite of a

more than doubling of the traffic volume for the project road sections20, constructing road

side amenities, reducing road related fatalities, establishing and enhancing KeNHA, and

increasing transparency and accountability in the road sub-sector as detailed in table 3.

Table 3. Summary of Achievement by PDO1

<Rehabilitation of Roads>

Rehabilitating total 419.3 km of the Northern Corridor satisfactorily

Travel time Mombasa-Malaba/Busia has been reduced by 15 percent

Condition of project road has been improved with International Roughness Index score

less than 3.0

Constructing road side amenities more than targeted

100 percent road users and local persons surveyed are aware of HIV/AIDS or make use

of VCT

<Road Safety>

Reducing road related fatalities: while total number of road related fatalities has not been

reduced, fatalities per 100,000 people have been reduced by 23 percent from 8.31 in 2008

to 6.4 in 2015

Constructed and rehabilitated six road safety parks

19 Total rehabilitated and improved road length 419.3 km includes 41.4 km dual carriage (377.9 +41.4= 419.3 km) as per

Borrower’s report. 20 For 8 project road sections, the average growth in traffic volume between 2003 and 2014/15 was 265 percent, varying

from 154 percent for the Lanet-Njoro Turnoff section and 345 percent for the Nyamasaria-Kisumu Airport-Kisian section.

17

<Institutional l Enhancement>

Road Act was enacted in 2007 and amended in 2009 and 2012

KeNHA, Kenya Urban Roads Authority (KURA), Kenya Rural Roads Authority

(KeRRA) have been created and functional

KeNHA/MoTI completed all planned feasibility and detailed engineering design studies

Established NCA is executing all the functions outlined under the Act

KRB completed inventory/reclassification of 160,886 km of roads which was published

in the national gazette in January 2016

EBK has been established and approved 32 accredited engineering programs in six

universities in Kenya

National Road Safety Program has been prepared and NTSA has been established

<Transparency and Accountability>

Road Sector Investment Program and Annual Public Road Programs are disclosed for the

public

GoK implemented most of RSGIAP in a satisfactorily manner

All road works under Road Authorities were procured under open tender

Kenya became one of the compliant Member States on Northern Corridor Transit and

Transport Agreement provisions

<Project ownership and commitment >

GoK provided US$307.94 million to complete the road sector work against US$126.12

million as revised at AF.

PDO2. Enhance Aviation Safety and Security to meet International Standards

-Rating: Substantial

72. The second PDO was substantially achieved as presented in table 4. The CAT1

certification has not been obtained officially but it is expected to be obtained later in 2016

due to the considerable improvements in aviation safety and security.


<Clearance of IASA Category 1>

KCAA is on track to meet the FAA CAT1 requirement, recruited key staff with the

required qualifications and in adequate numbers, especially in the area of safety

ICAO security audit in October 2015 scored Kenya, the KCAA and KAA a rate of 88

percent, against a cut off rate of 80 percent for CAT1 certification

< Clearance of Direct Flight to/from USA>

TSA cleared JKIA for direct flight to/from USA

<Expansion of JKIA and Kisumu Airport>

The number of passengers handled at JKIA has met the target of 6.4 million in 2014

The volume of cargo handled at JKIA has slightly decreased to 260,000 tons in 2014

Construction of a new terminal building (Terminal 1A, formerly Terminal 4)

Construction of a three-story car park at the airport, increasing its capacity to a total of

1,500 cars and grade parking for 400 cars

The expansion of the aircraft parking (apron) and taxiways at JKIA, which increased the

apron space by 50 percent through the creation of 13 new stands for aircrafts, a fuel

hydrant system, and two new taxiways

Kisumu airport has been upgraded into an international airport, which increased the

passenger capacity to 500,000

<Civil Aviation sub sector Reform and Institutional Development>

The creation of an airport security oversight unit which is responsible for monitoring

security issues and ensuring compliance with security regulations

KCAA and KAA became financially autonomous and retain the revenues generated from

their operations

18

The improved security monitoring at key airports through transferring the responsibility

for passenger, baggage and mail security screening from the police to the KAA

The adoption of harmonized aviation safety and security regulations by each member of

the East African Community

The continuation of the KCAA restructuring through the separation of its oversight

functions from service provision activities

EASA has been accredited by the ICAO as a regional training center of excellence, as

one of 16 training centers in the world

PDO3. Promote Private Sector Participation in the Management, Financing, and

Maintenance of Road Assets - Rating: High

73. The third PDO has been clearly achieved through mainstreaming OPRC, and

obtaining legal endorsement on private sector participation in management, financing, and

maintenance of road assets as summarized in table 5.


<OPRC awarding>

The implementation of performance-based contracts is apparent in the increased level of

private sector participation in the management and maintenance of road assets over the

course of the project and this approach is mainstreamed

KeNHA and KURA are managing 18 and 21 OPRC contracts, respectively21, with a total

amount of KSh 794 million (US$7.4 million) in FY15 and FY16

<Concession22>

One road segment of the Northern Corridor was offered for concession

The Parliament approved the concession contract in 2009

This activity was further developed into a pipeline project with a total estimated cost of

US$960 million, which was supported by several donors: IDA partial risk guarantee

(US$120 million), Multilateral Investments Guarantee Agency (US$120 million),

International Finance Corporation (US$115 million), African Development Bank

(US$100 million), and IDA (US$100 million)

<Legislation >

Kenya Roads Act 2007 encourages private sector participation in road construction,

maintenance, and management

The GoK established a Public-Private Partnership (PPP) Unit under the National Treasury

through the PPP Act of 2013

Toll road projects for Nairobi Southern Bypass and the Nairobi-Nakuru Highway are

some of the pipeline projects

PDO4. Restore Vital Infrastructure and Assets Damaged as a result of the 2007 post-

election crisis -Rating: High

74. PDO 4 was assessed attained successfully with the achievement of a PDO4 outcome

indicator and one of two intermediate indicators: In total, four public buildings became

functional against the target of three buildings.

21 According to the information obtained from KRB. 22 Due to the unfavorable results of due diligence from the Bank group, the GoK decided to terminate the process in 2011.

19

3.3 Efficiency Rating: Substantial

75. Efficiency of the project is assessed Substantial mainly due to the prolonged project

life and cost overruns in spite of the convincing results of the economic analysis for both

road and civil aviation components.

76. The ex-post economic analysis has been undertaken for the rehabilitation of key road

sections of the Northern Corridor (Component A), and the expansion of JKIA under the

original credit and the AF (Component F). The road works, with a total length of 419.3 km,

and the civil aviation related works account for about 72 percent, and 21 percent of the total

project cost, respectively. The details of the analysis can be found in annex 3.

Rehabilitation of the Northern Corridor

77. The main benefits of the rehabilitation of the Northern Corridor are the savings of

the road users in terms of vehicle operating costs, maintenance costs, and travel time costs.

The benefits were measured using the Highway Development and Management Model

(HDM 4), the same method that was used at the appraisal stage as well as at the AF. The

result indicates that the overall investments for road transport were economically viable for

all road sections with an economic internal rate of return (EIRR) ranging from 13.3 percent

in the Nyamasaia-Kisumu-Kisian section to 56.4 percent in the Machakos Turn off-JKIA

section, in spite of the cost overruns. The overall EIRR for the rehabilitation of the Northern

Corridor is 39.1 percent. The net present value (NPV) of the rehabilitation of the Northern

Corridor at 12 percent discount rate was US$550 million, which is about 26 percent higher

than that of the AF. The higher results than anticipated at appraisal and the AF in both EIRR

and NPV are mainly supported by significant traffic growth in all project road sections

between 2003 and 2014/15. The summary of economic analysis is presented in table 6.

Table 6. NPV and EIRR of the NCTIP

At Entry At AF At Ex-post

373km Road sections

under original

credit (223 km)

Road sections

under AF (158

km)

380 km

PV of Benefit (US$M) 235 n.a 265 809

PV of Base Cost (US$M) 110 n.a 199 259

NPV (US$M) 125 372 66 550

EIRR % 27 34 20 39

78. The Northern Corridor is the main transport corridor linking the land locked

countries of Uganda, Rwanda, and Burundi with Kenya’s maritime port of Mombasa, and

also serves the Eastern part of the Democratic Republic of Congo, South Sudan, and

Northern Tanzania. About 76 percent of urban dwellers, which is equivalent to 8.7 million

people in Kenya, are living within 15 km of the corridor. Project contribution to the regional

integration and trade enhancement is considered significant since the project rehabilitated

about 40 percent of the Corridor located within Kenya. The NCTIP reduced the average IRI

score of project roads to 2.2m/km at closure, which was ranging between 3.2 and 6.6 m/km

in 2003, which permits the saving of travel time and reduced vehicle operation cost.

20

79. Non-quantifiable benefits associated with the improvement of the Corridor include

the enhancement of, and better access to, socio-economic activities through the construction

of lorry parks, markets, schools, and improved road safety, especially for non-motorized

transport (NMT) with the construction of footpaths and foot-bridges. Furthermore, the

establishment and enhanced capacity of KeNHA and improved transparency in the civil

works industry through the enhanced capacity of KRB and the establishment of NCA and

EBK are also significant benefits obtained from the road subsector reform.

Civil Aviation Component

80. While the financial analysis has not been redone for the ICR, this result was

predicated on demand forecasts that predicted 5.5 million passengers (domestic,

international and transit) and 353,000 tons of air-freight by 2015, and annual growth rate of

4.7 percent. Actual data received from KAA reveals that total passenger numbers through

JKIA reached 6.4 million in 2014, with an annual growth rate of 6.4 percent, and cargo

260,000 tons of air freight.

81. The actual growth in passenger numbers exceeded the demand forecasts in the high

scenario, despite the impact of the global economic slowdown, and the fire at JKIA. The

drop in air freight is at least partially down to the introduction of stricter regulations in the

European Union on the importation of fresh products with excess level of pesticide

(Dimethoate)23 since the European market accounts for up to 80 percent of Kenya’s fruit and

vegetable sales and 42 percent of flower exports.

82. While actual financial costs (US$270 million) exceeded estimated costs markedly,

the growth in passenger traffic, the increase in the Airport Passenger Service Charge, a levy

charged on each passenger to pay for the improvements, from US$20 to US$40, would be

expected to more than ensure the investment was financially viable.

83. Flexibility in the project implementation such as the restructuring and AF to respond

to the changed priorities of the GoK, and cost increase, and obtaining financing from other

donors to cover up the financing gap, minimized these negative impacts. Nonetheless,

negative impact of cost and time overruns on efficiency is considered significant.

3.4 Justification of Overall Outcome Rating Rating: Satisfactory

84. Since relevance is assessed High, efficacy and efficiency are rated Substantial, overall outcome rating of the NCTIP is Satisfactory. 3.5 Overarching Themes, Other outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development

85. The roadworks under the project included socioeconomic enhancement elements.

The positive way in which the NCTIP altered the lives of ordinary Kenyans is encapsulated

in a documentary video (https://vimeo.com/116895967). Construction of roadside

amenities, such as lorry parks, a community center, and community market created a better

environment for truck drivers to rest and local residents to sell local products. Construction

23 Business Daily (2013) Chemical ban hits vegetable exports to the EU market, May 2013

https://vimeo.com/116895967

21

of five schools has provided better educational facilities for 2,620 students. Footpaths

constructed in the urban centers of Kisumu and Nakuru, with a total length of 24.8 km also

provide better safety for pedestrians and cyclists, including children and women. The

HIV/AIDS mitigation activity under the project resulted in 100 percent level of awareness

and availability of VCT centers for the surveyed sample.

(b) Institutional Change/Strengthening

86. The project supported the transport sector reform and made remarkable contributions

to institutional strengthening as summarized in annex 2d. Particularly, the NCTIP’s support

on the enactment of the Kenya Roads Act 2007, establishment of three road authorities,

financial autonomy of the KAA and KCAA are the most outstanding ones.

87. Under the NCTIP, a total of 380 staff attended oversea and/or domestic training

programs between 2005 and 2015. In addition, 21 staff from PTT including technical,

financial and procurement staff participated in disbursement and procurement clinics

organized annually by the Bank and enhanced their knowledge on fiduciary issues.

(c) Other Unintended Outcomes and Impacts

88. No other unintended outcomes and impacts are observed.

4 Assessment of Risk to Development Outcome

Rating: Low

89. Risks to maintain the development outcomes are assessed Low as described below:

90. Road Maintenance. At appraisal, the Road Maintenance Fuel Levy Fund, which was

established in 1994, could generate about US$100 million annually. This amount was just

enough to cover the core network of strategic roads, which were in maintainable condition.

With the increase of the number of vehicles and cost of fuel levy from KSh 9/l to KSh 12/l,

it is expected that the fund generate about US$400 million in 2015/16.24 Steady traffic

growth will support the increase of revenue in the fund. While some of the roads

rehabilitated are already under the OPRC, the NCTTCA keeps monitoring and reporting the

condition of the roads of the whole corridor with their own performance indicators.

Therefore, the maintenance risk of the Northern Corridor is low.

91. Decentralization. Kenya is experiencing a devolution process under the 2010

Constitution, which provided for not only a major devolution of resources and functions, but

also creating a whole new layer of county governments. Due to the devolution, the roles and

responsibilities amongst national government and county governments are still under

discussion. A draft bill has been prepared and submitted to the Parliament to propose

merging KURA and KeRRA.

92. Institutional Strengthening and Sustainability. The NCTIP supported the

establishment of KeNHA, KURA, KeRRA, NCA, NTSA, and EBK, and the institutional

enhancement of MoTI, KAA, KCAA, and KRB. Their implementation capacities have been

24 Estimation calculated by KRB.

22

increased through a technical assistance program but continuous supports for further

institutional strengthening and sustainability are necessary. For example, the KCAA has not

reached a final agreement of institutional arrangement and is still facing a challenge of

retaining an adequate number of flight inspection officers at the internationally required

level. KeNHA, in coordination with the KRB, needs to develop and apply construction cost

index for road works to prepare more accurate cost estimations. The on-going KTSSP and

NUTRIP have activities to support these institutions but it is necessary to monitor any other

needs for their sustainability.

5 Assessment of Bank and Borrower Performance

5.1 Bank Performance

(a) Bank Performance in Ensuring Quality at Entry Rating: Moderately Satisfactory

93. As noted in section 2.1, the project was designed in a client-oriented manner,

responding to the government’s priorities and aligned with the support areas identified under

the CAS (2004-07), after 10 years break in Bank financing in the transport. The project was

designed based on extensive discussions with both the GoK and development partners, being

part of the sector reform task force. The Bank ensured the setting up of an “all-inclusive”

PTT, and inclusion of adequate and secured domestic funding in the project financed

infrastructure maintenance. While the Bank policies, such as environmental and social

safeguards, were well respected, special attention was paid to road safety, which the Bank

was addressing as a key priority before the establishment of the Global Road Safety Facility

in 2006. In addition, efforts made for enacting the Road Act, establishing KeNHA, bringing

local academia on board for sustainable M&E system, are remarkable. To demonstrate the

GoK’s trust in the Bank, the project was launched by a well-organized workshop with

attendance by top managers of the transport sector.

94. In spite of numerous positive aspects observed in the Bank’s performance at entry,

the following shortcomings are observed: The PDOs were clear but the result chain from

outputs to intermediate outcomes and to final outcomes has not been well developed for

some components as noted in section 2.3. The significant cost overruns of road works were

mainly due to the factors beyond project control, but were also attributed partially to too

conservative cost estimates at entry. Thus, overall Bank performance at entry is rated

Moderately Satisfactory.

(b) Quality of Supervision

Rating: Moderately Satisfactory

95. The Bank team worked closely with the IAs and the GoK by providing technical

support. The Bank supervision team put appropriate fiduciary measures and safeguards in

place. Most of the team members were located in Nairobi, which allowed the team to provide

daily communication and support for the GoK. It was noted during the ICR mission that the

client respected the Bank and the relationship between the project management team and

IAs was solid, which enabled both sides to manage and conclude this complex project

successfully. Furthermore, the fact that anti-corruption measures introduced by the Bank

after the approval of project were mostly adopted and implemented successfully by the GoK

demonstrates strong commitment of the GoK to the Bank project. The Borrower’s ICR noted

23

that physical availability of the task team leader (TTL) at the country office made

consultation easier, which the GoK considers one of the reasons for the successful

implementation of the project.

96. The Bank was responsive and took necessary actions for emerging issues and

changing needs. While the AF and restructuring were undertaken to achieve the original

project target, adjustment of the financing arrangement was accepted to respond to

prolonged counterpart funding issues. These actions helped the project be concluded with

the completion of most activities, attaining the primary project objectives. The Bank’s

leadership among development partners in the transport sector was also noteworthy,

bringing other financiers on board, such as the NDF, EIB, and AFD to fill the financial gaps

and increase the coordination. Regular joint missions and joint ‘no objections’ organized

and issued with the AFD are noted as good examples of efficient coordinated supervision.

97. Nonetheless, the M&E implementation was rated Moderately Satisfactory. The Bank

should have been more proactive to improve the situation and ensure the quality of outputs,

understanding that this was the first attempt to utilize the university as an M&E consultant

in a large-scale investment project. Implementation of the RSGIAP was mostly carried out

but key monitoring indictors were not fully reported. As stated in section 2.3, inconsistency

in the monitoring of agreed indicators was also observed in ISRs and Aide Memoires.

98. Regardless of shortcomings in project design and the M&E, overall supervision,

which managed this complex and large-scale project to conclude successfully as discussed

in section 3.2, is rated Moderately Satisfactory on balance.

(c) Justification of Rating for Overall Bank Performance

99. As described above, overall Bank performance is rated Moderately Satisfactory.

5.2 Borrower Performance

(a) Government Performance


100. The GoK was committed to the transport sector reform and supportive to the project

throughout the project life, including the AF and restructuring, and executed more than what

was envisaged at appraisal. To manage this complex project, the POC was established.

Regular quarterly joint meeting with the IAs and the appointment of a project coordinator

were key factors for successful project implementation. The GoK’s commitment to the

transport sector reform is demonstrated in the number of acts enacted, policies adopted, and

authorities newly established or reformed with the direct and indirect support from the

NCTIP. Despite the fact that the introduction of RSGIAP and other anti-corruption measures

were additional heavy tasks assigned to the GoK after the project approval, the GoK

implemented most of actions satisfactorily, resulting in increased and long term

transparency and accountability in the road sub-sector. All authorities established are

functional though some are still facing challenges in securing resources. Specifically,

establishment of KeNHA, making KAA and KCAA financially autonomous and the

institutional enhancement of these three IAs are notable.

24

101. Nonetheless, inadequate counterpart funding was a serious issue that adversely

affected the implementation of the project and increased the total project cost. Through a

number of discussions, the National Treasury issued guidelines on budgets of donor-funded

projects in September 2015, and the disbursement of funds and payments to contactors

resumed in December 2015. Although the NCTIP has already been closed, this action will

be a significant contribution to other ongoing and future projects to avoid unnecessary delays

and accrual of interest. The limited capacity of staffing and frequent transfer of accountants

at the line ministry also affected the efficiency of project operation.

(b) Implementing Agency or Agencies Performance


102. PTT was set up in each IA and joint coordination meetings were organized regularly

to monitor the project progress. The MoTC, KAA, and KCAA did not have previous

experience in implementing Bank financed projects but they have learned the Bank

procedures during project implementation with support from the fiduciary team of the Bank.

For most part, compliance with environmental and social safeguards, as well as procurement

was largely satisfactory throughout project implementation. The immediate response of

KAA to the restoration of operations at JKIA in August 2013 after a major fire that destroyed

part of the airport, successful execution of 419.3 km of road rehabilitation and construction

at closure by the newly established KeNHA, and KCAA’s fulfillment of security

requirement for CAT1 are significant samples of demonstrating the positive results of

institutional enhancement and reform under the NCTIP. Coordination and communication

among the IAs were smooth, and each subsector had a better idea on the benefit of having

an integrated transport approach through the implementation of the NCTIP.

103. The change of the project leader of the PTT (road sub sector) without informing the

Bank was noted but the Legal Agreement was reconfirmed without such an issue recurring.

The road subsector encountered challenges such as cost overruns, poor performance of

contractors, and so on, which were partly the reason for the AF, restructuring, and extension

of the project closing date. The IAs’ coordination with the M&E consultant was not clear

though the IAs has monitored the progress and collected data of quality independently.

104. Completion of most activities of the NCTIP at closure, establishing new authorities,

experiencing organizational reforms, and coping with post-election violence, rate the

performance of IAs as Moderately Satisfactory

(c) Justification of Rating for Overall Borrower Performance

105. As detailed above, overall Borrower Performance is rated Moderately Satisfactory.

6 Lessons Learned

106. The approach of an integrated transport project with good partnership with

the government and a well-developed Results Framework can bring constructive

results. The GoK mentioned the following positive impacts of NCTIP: improved integration

of the transport system, enhanced coordination and inclusiveness of transport sub-sectors.

The National Treasury also strongly supports the integrated transport approach to boost

25

economic development.

107. Strong ownership of sector reform and institutional development enables

successful implementation of a complex project. The NCTIP was implemented in a period

that has seen three different government administrations but the GoK demonstrated a strong

commitment to the project and made considerable progress in sector reform and institutional

development, such as policy development and enactment of Road Act, establishment of road

authorities and a maritime authority, enhancement of road sector agencies, restructuring of

civil aviation authorities, and implementation of governance action plans.

108. A TTL assigned in the country office supports smooth implementation of

complex project and enhances coordination with the government counterparts. The

NCTIP was led by TTLs assigned in the country office, which allowed TTLs to deepen their

understanding of the transport sector in the country and enabled counterparts to

communicate and consult with the Bank team on a daily basis.

109. Close inter-agency coordination with a project coordinator concedes smooth

implementation of complicated project. The NCTIP was composed of multiple subsectors

of transport, but all implementation agencies commented that project coordination was

smooth. Quarterly inter-government project meetings and the project coordinator were

identified as the key factors of smooth coordination of this complex project.

110. A sound analysis to determine a realistic project duration is essential when the

project supports sector reform and institutional development. The NCTIP supported

large-scale infrastructure development but significant weight was also given to the transport

sector reform. To develop the sector reform to a sustainable level, the project needed

extensions through the AF and restructuring.

111. Securing the budget for the donor-funded projects by the National Treasury

helps smooth implementation. Inadequate counterpart funding was a serious challenge of

the NCTIP. With the issuance of a guidance note on donor-funded projects from the National

Treasury in September 2015, disbursement of funds and payments to contactors resumed in

December 2015. Therefore, for on-going and future projects, it is important for the GoK to

ensure the enforcement of the guidance note and for the Bank to monitor closely through

maintaining coordination with the National Treasury.

112. Sector-wide support by INT can bring long term transparency and

accountability in Transport sector. The NCTIP received numerous supports from INT and

implemented various activities to increase transparency and accountability in the road sub-

sector. As a result, annual/5-year road investment plans are disclosed to the public,

construction companies are registered, corruption-reporting system becomes available, all

road works under the Road Authorities are procured under open tender, and the number of

qualified bids has been increased with competitive offer, some of which are below the

engineers’ estimates.

26

7 Comments on Issues Raised by Borrower/Implementing Agencies/Partners

(a) Borrower/Implementing Agencies

113. The GoK has prepared the Borrower’s ICR and provided comments on the draft ICR,

both of which are found in annex 7.

(b) Co-Financiers - Not Applicable

(c) Other Partners and Stakeholders

114. The draft report was shared with the parallel financiers, NDF and AFD for their

comments. The NDF and AFD thanked the Bank for sharing the draft report and informed

that they had neither specific questions nor comments on the report. The AFD also expressed

their gratitude to the Bank’s project team for the quality of collaboration in the

implementation of Component F.

27

Annex 1. Project Costs and Financing

(a) Project Cost by Component (in USD million equivalent)

Note: *Project operating costs for Component A, B, C, D and E are available in an aggregated manner only.

** No AF from IDA. The cost includes parallel finance and GoK’s own contributions

*** Actual estimates for Component B and D are included under Component A.

(b) Financing

Note: *under appraisal,

**Others includes Kenya Local Bank and other financiers

Appraisal

Estimate

(US$

millions)

Additional

Finance

Estimate

(US$

millions)

Actual/

Latest

Estimate

(US$

millions)

Latest %

of

Appraisal

Latest %

of

Revised

Estimate Components

A. Rehabilitation of the Northern

Road Corridor 190.46 546.86 750.78 394 137

B. Socio-Economic Enhancement,

Roadside Amenities and HIV/AIDS

Mitigation.

4.35 3.78 0*** 0 0

C. Private Sector Participation in

Road Management and

Maintenance.

10.66 16.54 2.60 24 16

D. Road Safety Improvement 4.96 4.97 0*** 0 0

E. Institutional Strengthening in the

Roads Sector and Technical

Assistance

10.36 35.88 32.43 313 90

Project operating costs(MoTI)* 1.1 1.1 - - -

F. Support to the KAA 41.91 297.90** 246.27 588 121

G. Support to the KCAA 10.21 10.31 9.26 91 90

H. Support to the MoTI 2.48 2.49 2.36 95 95

Total Project Cost 276.49 919.83 1043.71 377 113

Source of

Funds

Type of

Funding

Appraisal

Estimate

(US$

millions)

Revised

Estimate

at the

AF (US$

millions)

Revised

Estimate at

Restructuring

(US$ million)

Actual/

Latest

Estimate

(US$

millions)

Latest %

of

Appraisal

Latest

% of

Revised

Estimate

Borrower Counterpart

Funding 54.26 340.64 225.00 430.76 794 191

IDA Credit 207.00 460.00 460.00 491.35 237 107

NDF Loan 15.23 19.19 19.00 28.93 190 152

EIB Loan 0.00 70.00* 93.00 0.00 n.a. 0

Others** Loan 0.00 30.00 30.00 0.00 n.a. 0

AFD Loan 0.00 0.00 93.00 92.67 n.a. 100

Total 276.49 919.83 920.00 1043.71 377 113

28

Annex 2. Outputs by Component

Annex 2a. Outputs of Project Components

Table 2.1. Summary of outputs by component

Component Description Outputs Achieved

Original Additional Financing Original Additional Financing

A. Rehabilitation of the Northern Corridor.

Rehabilitation of

infrastructure and provision of

services for the improvement

of approximately 373 km of

roads in selected sections

along the Northern Corridor,

including construction of

approximately 8 km of roads

connecting the old Embakasi

Airport terminal to Nairobi-

Mombasa highway.

Rehabilitation of infrastructure

and provision of services for the

improvement of approximately

383 km of roads in selected

sections along the Northern

Corridor.

The following road sections (total 419.3 km (including 41.4 km dual carriage)) have

been completed and handed over to the GoK: (a) Maji ya Chumvi - Miritini (35 km, (5

km of which is dual carriageway)); (b) Sultan Hamud-Machakos Turnoff (55 km); (c)

Machakos Turn off-JKIA (33 km (12 km of which dual carriageway)); (d) Lanet-Njoro

Turnoff (dual carriageway 16 km); (e) Njoro Turnoff-Timboroa (84 km); (f) Mau

Summit-Kericho (57 km); (g) Kericho-Nyamasaria (76 km); and (h) Nyamasaria-

Kisumu Airport-Kisian section (total 21.9 km (8.4 km of which dual carriage)).

Rehabilitation and repair of roads,

bridges, buildings, and other

public infrastructure damaged or

destroyed by floods or the events

of the December 2007 post-

election crisis.

The main buildings works at Oyugis office and two Homa Bay offices

are completed and in use while KeNHA regional office (new office

building) in Kisumu is also completed. Rehabilitation of KeNHA

regional office in Kisumu is completed and in use. Road and bridges at

Kisian-Busia road sections were also rehabilitated with the GoK fund.

Replacement of public equipment

and vehicles destroyed during the

December 2007 post-election

crisis.

Completed.

Implementation of the mitigation measures specified in the EIA and

provision of support to PAPs including provision of support for

resettlement activities and compensation.

For the most part, compliance with both environmental and social safeguards was

largely satisfactorily throughout the project implementation. KeNHA has not yet

prepared a RAP Completion Report.

29

B. Socio-Economic Enhancement, Roadside Amenities and HIV/AIDS Mitigation.

Construction of facilities to enhance the socio-economic impact on

local communities and improve safety of road users, including bus

and truck stops, parking areas, utilities, merchandise booths for use

by local communities, bicycle paths, and pedestrian sidewalks.

(a) Roadside Amenities: A lorry park at Sultan Hamud-Machakos Junction, a market at

Taru, a community center at Chepseon, and five schools in Taru, Mlolongo, and

Kisumu airport have been constructed under the project. Footpaths as Non-Motorized

Transport (NMT) Facilities have been constructed in the road sections in the urban

centers of Kisumu and Nakuru. (Total length of footpaths is 24.8 km). A lorry park at

Nyamasaria and a market at Awasi are currently under construction and expected to be

completed by the end of May 2016.

Development and implementation of measures to mitigate effects

of HIV/AIDS, including awareness and information dissemination,

distribution of condoms, strengthening of local health centers,

facilitation of voluntary testing and counseling including

construction of kiosks for these purposes, and provision of support

to infected and affected people.

(b) HIV/AIDS mitigation: Implementation of this activity involves two dimensions: (i)

measures aimed at project workers for whom the contracts provide such items as

condoms, educational pamphlet and awareness raising through experts to help

disseminate information; and (ii) a second tier intervention including truck drivers and

other stakeholders operating along the Northern Corridor. Implementation of first

dimension has proceeded well, all work contractors under the project received support

from a local non-governmental organization (NGO) which is registered and recognized

by the National Aids Control Council to conduct awareness, education and information

on HIV/AIDS targeting the workers, truck drivers and local community members

including setting up of VCT centers.

C. Private Sector Participation in Road Management and Maintenance.

Provision of technical advisory services for the preparation of bid

documents for and facilitation of the concessioning of selected road

sections of the Northern Corridor; and performance-based

maintenance of approximately 300 km of selected roads by the

private sector.

Both activities under Component C were cancelled without completion. However,

positive impacts of the project on the involvement of private sectors in road management and maintenance are observed.

(a) (Completed) One segment of the Northern Corridor was offered for concession to

the private sector (target achieved), but financial closure was not concluded and as a

result, the process was terminated. There is no toll road in Kenya yet. The concept of

concession of road segments to the private sector was also new in Kenya. It was

concluded that the regulatory framework to embrace the involvement of private sector

in the management, financing, operation and maintenance of road assets would be

necessary. PPP Act was enacted in 2013 and the PPP unit was established under

section 8 of the act as the special purpose unit within the NT.

30

(b) The process was cancelled due to the receipt of nonresponsive bids. The concept of

performance-based contract was new to Kenya when the bids were invited and it was

not well understood by potential bidders. Although the process under the project was

cancelled, KeNHA worked with assistance under the project and carried out sensitization

on long-term performance based road maintenance contracting, through a workshop for

consultants and contractors. The concept has been accepted in Kenya and maintenance

of any new road constructed will be under the performance-based contract. Currently

there are 39 long-term performance based contracts awarded and under

implementation.

D. Road Safety Improvement.

Improvement of safety conditions in selected locations along the

Northern Corridor, including carrying out of a road safety and

awareness campaign, construction of approximately 5 children’s

traffic safety parks, rehabilitation of about 5 existing children’s

traffic safety parks, and improvement of safety conditions of

hazardous locations.

National Road Safety Program (NRSP) was developed and adopted by the GoK during

the first phase of project. With the establishment of the NTSA in 2012, the

implementation of the NRSP has been undertaken by the NTSA. The procurement of

information and communications technologies (ICT) equipment for institutional

capacity building has been completed. NTSA has carried out countrywide road safety

education, public awareness campaign. But the authority is facing financial and human

resource challenges to conduct road audit. The NTSA is currently collecting road

accident data for entire country from the police and reporting it on their website daily.

The NTSA also analyzes and summarizes the road safety statistics annually.

Safety Park. With the establishment of KURA, this activity was transferred to KURA.

The authority has continued to manage the parks and currently there are six (6) parks

in operation in: Nairobi, Nyeri, Embu, Kisumu, Kisii and Kakamega. The authority is

currently rehabilitating Kisii Children’s Traffic Park. An additional park is also

being established in Nairobi at the junction of Outer Ring Road/Kangundo Road

under the ongoing Outer Ring Road expansion project financed by the government and

AfDB.

The number of fatalities related to road accidents in 2015 was 3,057. The target of the

project was to reduce the total number of fatalities by10% between 2004 and 2015.

Although this target has not been achieved, fatalities per 100,000 have reduced from

8.31in 2008 to 6.4in 2015.

31

E. Institutional Strengthening in the Roads Sector and Technical Assistance.

Establishment and

strengthening of KeNHA

through provision of technical

advisory services.

Road Authorities. The Kenya Roads Act was enacted in 2007 and enabled the

creation of three road authorities: KeNHA, KURA, and KeRRA in 2008. Equipment

purchase, vehicle acquisition, and consultant service for the construction supervision,

and feasibility studies were provided. With this reform in the road sector, the ministry

can focus on policy formulation and oversight and road authorities can focus on the

implementation of programs and projects. KeNHA is currently composed of 6

departments, 10 regional offices, and 487 staff according to the annual report of

2014/15. KeNHA prepares an annual work program and submits it to the KRB, which

in turn prepares and publishes Annual Public Road Programme (APRPs) that

consolidate the annual work program of the three road agencies.

Strengthening the KRB

including reforming its

mandate through carrying out

of studies and reviews and

provision of technical

advisory services and

training.

Strengthening the capacity of the

KRB and reforming its mandate

through carrying out of studies

and reviews, and provision of

technical advisory services and

training.

KRB: All four studies have been completed. (a) Road User Charges Study, (b) Road

Inventory/Road Reclassification Study, covering 160,886 km of roads, (c) Road

Sector Investment Program (RSIP), and (d) Transport Sector Indictor Framework

Study. Road classification has been published in the national gazette in January 2016.

The RSIP is under implementation with a 5-year detailed program. Second phase of

the 5-year program (2015–19) is under preparation. In addition to RSIP, APRPs are

also disclosed on their website.

Designing Kibwezi-Kitui-

Mwingi-Maua-Isiolo road

corridor.

Conducting feasibility studies and

designing of the (a) Kibwezi-

Kitui-Mwingi- Maua-Isiolo road

corridor; (b) the alternative route

linking northern Tanzania to

Narok in the territory of the

Recipient; (c) the Sudan link road;

(d) the access road to the Moi

international airport, Mombasa;

and (e) the Mombasa By pass.

Feasibility Studies: All the feasibility and detailed engineering design studies on

selected road sections have been completed. (a) three sections along the Kenya-

South Sudan Road, which will now be reconstructed with financing under the Bank-

financed EATTEDP, (b) Kibwezi-Kitui-Mwingi-Maua-Isiolo, (c) Narok-Nothern

Lakeside Tanzania, and (d) Mombasa Southern Bypass, which is now funded by JICA

for construction.

Designing an alternative route

linking northern Tanzania to

Narok in the territory of the

Borrower, and designing the

widening of the access road to

the Moi International Airport

in Mombasa.

Carrying out of feasibility and

sector studies for the transport

sector including the Mombasa

Bypass study.

32

Preparation of a ten-year

national transportation

development plan.

Preparing a ten-year national

transportation development plan.

The development of a 50 year transport master plan including a 10 year investment plan is delayed due to poor performance by the consultant. MoTI hired a team of

experts to review the draft plan prepared by the consultant but the result was not

positive. The GoK is currently internally discussing the way forward.

Carrying out several transport

sector studies including an urban

transport study for Nairobi.

IDA funds were reallocated and the activity is financed under

NUTRIP.

Strengthening the Department

of Materials Research and

Development at MORPWH

and External Resources

Department of the Ministry of

Finance.

Strengthening and building the

capacity of the Roads Department,

Materials Research and

Development Department,

KeNHA, KeRRA, KURA, KRB,

Mechanical and Transport

Department, Kenya Institute of

Highways and Building

Technology, Engineers

Registration Board (ERB) and

associated institutions; the

External Resources Department

State Law Office, Department of

Government Investments and

Public Enterprises, and the

Institution of Engineers of Kenya

through provision of equipment,

training and technical advisory

services.

Training. Acquiring critical equipment for these departments and organizations has

been completed.

EBK: The reform of the ERB was effected through: (a) the repeal of the Engineers

Registration Act (1969) and the enactment of the Engineers Act 2011. The EBK was

created through the newly enacted act in 2011 to widen the mandate of the EBK to

oversee and regulate the standards in the engineering profession and building capacity

for individual engineers and engineering firms. Currently there are 32 accredited

programs in 6 universities in Kenya. The biggest challenge for the EBK is the

availability of funds to sustain the organization.

Capacity building for

MORPWH, NHA, the

External Resources

Department of the Ministry of

Finance and KRB in

management and financing of

roads including axle load

monitoring and control.

Monitoring, evaluation, and

impact assessment of the

Project.

Monitoring, evaluating and

conducting of impact assessment

of the Project including reviewing

of ongoing and recently completed

contracts for compliance with the

relevant contractual requirements.

The consulting division of the University of Nairobi Enterprises and Services (UNES)

was awarded the task of Monitoring and Evaluation for the project. However,

submission of reports were delayed and the final draft report initially covered the

period up to 2013 only and M&E results for 2014 and 2015 were missing. In addition,

several indicators adopted under the Results Framework of the project are not included

in the report yet. The revised final version was submitted on March 30, 2016. Although

the approach to support the enhancement of research capacity of local academia

was innovative, it was observed that there was confusion for the UNES in

33

understanding their role as a consultant as well as specific tasks assigned for this

M&E.

Establishing and building the

capacity of the National

Construction Authority (NCA).

The NCA was established in 2011 through the enactment of the NCA

Act 2011 to regulate, streamline, and build capacity in the construction

industry. The act has outlined 14 functions for the NCA and it is

already executing all the functions, focusing on contractor registration,

contractor training, and quality assurance with a total of 78 staff. The

revenue of the NCA comprises: (a) a budget from the GoK, (b)

registration fee, (c) annual renewal fee, (d) levy of civil works

contracts, and (e) training fee. For the period 2015–20, NCA’s planned

budget is KSh 27 billion and it is estimated that KSh 16–17 billion is

secured from the national budget. The NCA is currently preparing the

financial report for 2014/15 and annual report 2014/15 is expected to

be published in April 2016.

Establishing a system in KeNHA

for responding to and managing

disasters requiring emergency

road works and other related

materials.

After the discussions, the Road Disaster Management and Response

Unit has been established under MoTI (Road Department), not

KeNHA, and functions as a committee comprising representatives

from road authorities when a disaster occurs. It works with the

National Disaster Operational Center and is a member of the task

force. The unit procures materials and equipment for disaster response.

Although the unit was established, no budget has been allocated yet

and the term contract was not advertised.

F. Support to the Kenya Airports Authority.

Provision of support to KAA to improve aviation security, safety,

and operations at major airports through acquisition of equipment

and vehicles; carrying out of civil works; provision of technical

advisory service, and training, including:

Rehabilitation and

reconfiguration of old

Embakasi Airport terminal

and the main terminal at Jomo

Kenyatta International Airport

(JKIA) and construction of

the road linking the two

terminals.

Expansion of the JKIA through its

reconfiguration and construction

of a new unit.

Apron extension taxiways Unit 4 terminal building and car park of JKIA have been

completed. The EIB cancelled the finance for the design and remodeling of Terminals

1-B, C, and D because of delay of the process. There was delay in the process and also

because of the fire at the arrival hall of JKIA in 2013, the entire airport layout had to

be reviewed. The government will finance this activity and possibly with the support

from development partners.

34

Installation of fencing,

lighting, and surveillance

systems at JKIA, Moi

International Airport, Wilson

Airport, Kisumu Airport,

Malindi Airport, and Ukunda

Airport.

Installation of fencing, lighting,

and surveillance systems at JKIA,

Moi international airport, Wilson

airport, and Kisumu airport.

Significant security improvement at JKIA was achieved by completing the security

fence, enhancement of screening by use of X-ray screening machines and separation of

arriving and departing passengers. As a result, the ICAO security audit of October

2015, scored Kenya, KCAA and KAA 88 percent rate, against a cut off of 80% for

CAT1 certification.

For Kisumu and Moi Airports, the project supported the purchase of materials for

fencing.

Rehabilitation of and

reconfiguration of terminal

buildings at Kisumu and

Wilson Airports, and

rehabilitation and extension of

the runway at Kisumu

Airport.

Rehabilitation and reconfiguration

of terminal buildings at Kisumu

and Wilson airports, and

rehabilitation and extension of the

runway at Kisumu airport.

A new terminal building was constructed instead of rehabilitation of the old building.

The runway rehabilitated and extended, and an access road and parking area at Kisumu

Airport constructed. Renovation and upgrading of security at Wilson Airport:

feasibility study was completed but the KAA faced challenges as part of the airport

land was acquired for private development thereby constraining the expansion and

location of a new terminal building. In addition, due to the increased demand of

facility improvement in other national airports, priority of the KAA has changed. As

the result, the GoK requested for reallocation of IDA funds for this activity toward the

expansion of JKIA, which was done under restructuring of the project.

Enhancing aviation security

and safety, flight information

system, search and rescue

capacity, communications,

and emergency operations

centers at JKIA, Moi

International Airport, Wilson

Airport, and Kisumu Airport.

Enhancing aviation security and

safety, flight information system,

search and rescue capacity,

communications, and emergency

operations centers at JKIA, Moi

international airport, Wilson

airport, and Kisumu airport.

Transport Safety Authority of the United States cleared direct flights to/from U.S.

airports to JKIA in 2009, though an official certificate has not been issued. Delta

Airlines was supposed to have the maiden flight and the Minister of Transport of

Kenya was invited to join the first flight in 2009. However, because of the emerging

security concerns and terrorist threats in the region attributed to Somali-based Al

Shabaab direct flights were put in abeyance. The funds allocated for the following

activities were reallocated to the JKIA expansion: (a) security perimeter lighting and

detection at four airports, (b) security and communication equipment and vehicles at

four airports, and (c) support emergency operation centers.

Capacity building for staff in

airports operations security

and management.

Capacity building for staff in

airports operations, security, and

management.

A total of 171 staff attended the overseas and/or domestic training program between

2007 and 2015.

G. Support to the Kenya Civil Aviation Authority (KCAA).

Development and implementation of reforms at KCAA aimed at

enhancing aviation safety and security oversight, and safety

inspection through provision of technical advisory services and

training.

The KCAA engaged with a human resource consultant to conduct a study on the

institutional reforms to be implemented. The revenues of the KCAA have been tripled

between 2004 and 2015, which allows the KCAA to recruit more inspectors. Number

of airworthiness inspectors and flight operations inspectors increased from 3 to 18 and

1 to 16, respectively. It is expected that the KCAA can obtain the IASA CAT1 in the next audit in 2016.

35

Provision of support to

KCAA and EASA through

acquisition of training and

operations equipment

including equipment for

accident investigation

laboratory.

Provision of support to KCAA

and EASA through acquisition of

training and operations equipment.

Air traffic control training school of aviation simulator, laboratory equipment for

telecommunications engineering, test and measurement equipment, two generators, air

conditioners, search and rescue equipment, and library books were purchased. A

Trainer Plus Program was implemented. The EASA enhanced its capacity and is now

accredited by the ICAO as a regional training center of excellence. Such centers exist

only in South Africa and Kenya, in Africa, and in 14 other locations in the rest of the

world.

Implementation of GNSS-

GPS enroute and approach

procedures through provision

of technical advisory services.

Provision of technical advisory

services to use the global

navigation satellite system and

global positioning system to repair

approach navigation charts for

selected airports.

Implementation of GNSS procedures was completed for six airports (Kisumu, Malindi,

Lokichoggio, Lamu, Nanyuki, and Ol Kiombo Airports) and ICT systems were

installed and in use, improving approach and departure procedures allowing aircrafts to

fly more directly which saves fuel costs at these airports and enhances safety in the

airspace.

Carrying out of training of trainers in airworthiness inspection,

flight operations inspection, personnel licensing and security

oversight.

This was completed as follows (a) flight inspection staff were provided for 3 years to

fill the shortfall at KCAA; (b) safety regulations, technical guidance materials, on-the-

job training program and manuals for inspections and audits were developed and in

use; (c) inspector’s guidance materials were prepared and in use; (d) a database has

been established containing information on registration of aviation personnel, aircraft,

Aircraft Maintenance Organization (AMO) and air operators; (e) a strategic plan for

East Africa School of Aviation (EASA) was prepared and is under implementation; (f)

on-the-job training was conducted using the developed materials; and (g) a human

resources and financial restructuring study was carried out, which formed the basis for

the proposed restructuring of the KCAA

H. Support to the Ministry of Transport and Infrastructure (MoTI).

Capacity building for MoTC

in procurement, Project

management, financial

management; implementation

of the national transportation

policy and maritime law; and

compliance with conventions

of the International Maritime Organization; establishment

Building the capacity of MoTI in

procurement, project management,

financial management;

implementation of the national

transportation policy and maritime

law; and compliance with

conventions of the International

Maritime Organization.

The procurement of computers and other ICT equipment and installation has been

completed. This activity included the support of digitization of human resource records

in the ministry. The Traffic Act has been reviewed to ensure that it conforms to

international transport conventions including the Northern Corridor Transit

Agreement. The implementation of the National Transport Policy has enhanced road

safety, improved compliance with international road safety levels, and improved

efficiency and smooth operations in the Public Service Vehicle industry due to

behavioral change of the players. The training curriculum for driving schools has been developed and approval from the Minister of Transport and Infrastructure is awaited.

36

and strengthening of the

Maritime Authority; assisting

the GoK to comply with the

Northern Corridor Transit

Agreement; and provision of

support to Bandari College,


advisory services and

training, and acquisition of

equipment.

Strengthening the capacity of the

Kenya Maritime Authority


advisory services, training, and

acquisition of equipment.

The project supported the establishment of a new maritime administration, the Kenya

Maritime Authority (KMA), which was set up in June 2004 as the semi-autonomous

agency in charge of regulatory oversight of the Kenyan maritime industry.

Procurement and installation of a local area network and computers at the KMA

headquarters has been completed.

Assisting the GoK to comply with

the Northern Corridor Transit

Agreement through training and

technical advisory services.

Kenya is one of the compliant member states on the NCTTA provisions.

Provision of support to Bandari

College, through provision of

technical advisory services,

training, and acquisition of

equipment.

Procurement of navigation bridge simulator software and ICT equipment and cabling

of the training room for Bandari College has been completed. Bandari College is now

one of the four accredited institutions for maritime education and training in Kenya.

Kenya is already listed among the white list countries based on proper implementation

of the International Convention on Standards of Training, Certification, and Watch

keeping for Seafarers of 1995.

37

Annex 2b. Outputs of Project Components

Table 2.2. Achievement by outcome and intermediate indicators

PDO Outcome Indicators

Original AF/ Restructuring Original AF Restructuring Targets

Actual

Values

Percent

Achieved

1. Increase the efficiency of road transport Travel time by road from Mombasa to Malaba and

Busia reduced by 25 percent

25% 15% 61%

2. Enhance aviation safety and security to meet

international standards

(a) KCAA is cleared as category 1 safety status under

the IASA of the US FAA

(b) JKIA in Nairobi is cleared by the US TSA for direct

flights to/from United States airports

CAT 1

clearance

obtained

Direct

flight

cleared

Not obtained

but met the

requirements

Direct flight

cleared

0%25

100%

3. Promote private sector participation in the

management, financing, and maintenance of road

assets

(c) One long term performance based road management

and maintenance contract awarded to the private sector

and is effectively under implementation

(d) One road segment along the Northern Corridor

offered for concession to the private sector

100%

100%

100%+

100%

100%+

100%

4. Restore vital

infrastructure and public

assets damaged as a result

of the 2007 post-election

crisis

Vital public infrastructure and assets

destroyed or damaged during the post-

election crisis are restored and functional

again

100% 100% 100%

Intermediate Results / One per component Results indicators for each component

Original AF/ Restructuring Original AF Restructuring

Component A

Contracts awarded

and construction

Contracts awarded and

construction satisfactory

Average roughness less than International Roughness

Index (IRI) 3.0 m/km on completed sections of the

100% 100% 100%

25 Since the CAT1 clearance has not been obtained officially yet, it is considered that the project has not achieved the target. However, please note that the KCAA and KAA have met all

the requirements to obtain CAT1.

38

satisfactory on 373

km of selected

priority road

sections along the

Northern Corridor

and 8 km of the

Airport North Road

on 381 km of selected

priority road sections

along the Northern

Corridor

project roads

Damaged or destroyed

assets restored

(a) 3 bridges

repaired and

functional

(b) 3 public

buildings restored

and functional

(c) 3 term

contracts

awarded for

disaster response

readiness

(a) Not mentioned in

restructuring paper

(b) 3 public buildings

restored and

functional

(c) 3 term contracts

awarded for disaster

response readiness

3

3

4

0

100%+

0%

Component B

(a) Effective functioning of bus and truck stops at

key locations and satisfactory construction and

utilization of booths for sale of local produce and

products by roadside communities

(b) Health kiosks constructed and HIV/AIDS

awareness campaigns undertaken at key locations

along the Northern Corridor

(a) At least three roadside stations and amenities

constructed and functional as per designs and serving

road users and local communities

(b) At least 70% of road users and local persons

surveyed become aware of or make use of the

Voluntary Counseling and Testing (VCT) and other

facilities for the HIV/AIDS campaign along the

Northern Corridor

3

70%

>3

100%

100% +

100% +

Component C

Private Sector involved in road management and

maintenance

Legislation enacted for private sector participation in

roads

100% 100% 100%

Component D

Road safety improved At least 10% reduction in road related fatalities per

annum

2,700 3,057 0%

39

Component E

Management and governance improved in the

road sector

(a) KeNHA established and fully functional

(b) All feasibility and design studies carried out

satisfactorily

KeNHA

established

100%

KeNHA

established

100%

100%

100%

(c) Timely public disclosure of national

program and business opportunities in the

road sector

(d) NCA established and functioning

satisfactorily

(e) Governance and Integrity Action Plan

implemented satisfactorily*

(f) User perception and satisfaction

improved in the road sector*

Plan

disclosed

NCA

established

100%

>75%

satisfaction

Plan

disclosed

NCA

established

mostly

implemented

not assessed

100%

100%

substantial

n.a.

Component F

Security improved at major airports JKIA meets ICAO and USA TSA security

requirements.

100% 100% 100%

Capacity at JKIA expanded (a) Annual passengers handled at JKIA

increased from 4.8 million in 2007 to 6.4

million in 2012

(b) Cargo by air handled at JKIA

increased from 278,000 tons in 2007 to

383,000 tons in 2012

6.4

383,000

6.4

260,000

100%

0%

Component G

Aviation safety and air navigation standards

improved

KCAA meets ICAO and USA FAA Category 1 safety

requirements

100% 100% 100%

Component H

Compliance with IMO conventions and NCTTCA

treaty

IMO and NCTTCA certify compliance 100% 100% 100%

40

Annex 2c. Detailed Narrative Summary of Achievement of Project Development

Objectives

PDO1. Increase the Efficiency of Road Transport

Rating: Substantial

1. The project has substantially achieved first PDO by rehabilitating total 419.3 km of

the Northern Corridor satisfactorily, constructing road side amenities, reducing road related

fatalities, establishing and enhancing KeNHA, and increasing transparency and

accountability in road sub-sector.

2. The outcome indicator for the first objective, “freight and passenger travel time by

road from Mombasa to Malaba reduced by 25 percent” was 60 percent achieved by the

project closing with 15 percent lower travel time than the baseline. While a 25 percent

reduction in travel time between Mombasa and Malaba was recorded in ISR Sequence 12,

in December 2009 after the completion of Maji Ya Chumi- Miritini (40 km) and Lanet-

Njoro Turnoff (dual 16 km) road sections, 2014 and 2015 travel time data obtained from the

NCTTCA and UNES indicate the travel time decreased to 15 percent by the project closing.

The increased traffic volume along the project roads, particularly in Nairobi as shown in

table 2.3, and on-going maintenance works in other sections of the Northern Corridor are

the most likely explanation for the increase26.

Table 2.3: Traffic Survey Result in Nairobi

Survey/Year 2004 2013

Cordon line survey (total vehicles in 24 hours) 121,000 205,000

Screen line survey (total vehicles in 24 hours) 251,728 418,885 Source: Integrated Urban Development Master Plan for the City of Nairobi (final report, appendix III), December 2014, JICA

3. Seven original intermediate indicators and two revised intermediate indicators were

achieved satisfactorily. From the total length of 419.3km rehabilitated road, 389km exceeds

the target average roughness of less than IRI 3.0 as indicated in table 2.427 . The newly

established KeNHA, KURA, and KeRRA are all functional against the target of

establishment of one national highways authority. All planned feasibility and detailed

engineering design studies on selected road sections, have been completed and

implementation of Mombasa Southern Bypass is financed by JICA, and the design of

Lesseru-Nadapal/Nakodok Road has accelerated the preparation of the Eastern Africa

Regional Transport, Trade and Development Facilitation Project (P148853).

4. The newly established NCA is functional and the NCTIP meets the target of ‘timely

public disclosure of road sector program’ through the publication of the Road Sector

Investment Program (RSIP), and Annual Public Road Programs (APRP) by KRB. All road

works under the Roads Authorities are procured under open tender. The total number of

road related fatalities in Kenya has not been reduced but analysis prepared by the NTSA

shows that fatalities per 100,000 people have been reduced by 23 percent from 8.31 in 2008

26 BBC also reported heavy traffic jam stretching for 50 km (30 miles) on the highway between Mombasa and Nairobi on

November 19, 2015. 27 The road section of Nyamasaria-Kisumu Airport-Kisian (21.9 km, (8.4 km of which is dual carriageway), total 30.3km)

was handed over to the GoK in March 2016 and the IRI data for this section is not yet available.

41

to 6.4 in 2015. Two intermediate indicator related to social aspects also met the targets. In

addition, Kenya became one of the compliant Member States on Northern Corridor Transit

and Transport Agreement provisions.

Table 2.4. Average IRI score by road section

Source: PAD and maintenance data of KeNHA

5. There are other benefits of the project

which are associated with PDO1 and

worth mentioning:

6. The NCTIP rehabilitated and

improved a total of 419.3 km (including

41.4 km of dual carriage) of roads,

exceeding the revised target of 383 km

listed in the Financing Agreement by 36

km. The GoK’s contribution to the road

works was planned at US$42.63 million

at entry but it was increased to

US$126.12 million at the AF, and

US$307.94 million at closure. In

addition to the improvement of IRI

scores as stated above, the NCTTCA

also reported that the road condition

between Mombasa and Malaba is either

‘Excellent’ or ‘Good’ in 2015, which

was rated only ‘Poor’ to ‘Good’ in 2009.

The Northern Corridor runs from

Mombasa Sea Port through Kenya and

Uganda to Kigali in Rwanda,

Bujumbura in Burundi and to Kisangani

in the Democratic Republic of Congo

and about 930 km is under the Kenya’s

Section IRI

(2003) IRI (2013, 2015)

1. Maji ya Chumvi - Miritini (35 km, 5 km of

which is dual carriageway) 6.4 2.6

2. Sultan Hamud-Machakos Turnoff (55 km) 3.2-3.9 1.8

3. Machakos Turn off-JKIA (33 km, 12 km of

which is dual carriageway) 4.0-4.6 1.9

4. Lanet-Njoro Turnoff (dual carriageway 16 km) 3.2-3.3 2.0

5. Njoro Turnoff-Timboroa (84 km) 6.4-6.6 2.2

6. Mau Summit-Kericho (57 km) 4.8 2.2

7. Kericho-Nyamasaria (76 km) 4.8-5.8 2.7

8. Nyamasaria-Kisumu Airport-Kisian (21.9 km,

8.4 km of which is dual carriageway) 4.8 Not yet measured as this

section was handed over to

GoK in the end of March 2016.

Total Average n.a. 2.2

Source: Kenya Urbanization Review, 2016, the World Bank

Northern Corridor

Map 1. Concentration of Urban Population

along the Northern Corridor

42

jurisdiction. In addition, about 76 percent of urban dwellers in Kenya, which is equivalent

to 8.7 million people, are living within 15 km of the Northern Corridor. Therefore, the

positive impact of physical improvement of 419.3 km of roads on the efficiency of road

transport along the corridor is considerable.

7. Support to the KRB resulted in the completion of inventory/reclassification of

160,886 km of roads which was published in the national gazette in January 201628. This

clarifies the responsibility of each road authority, and the inventory data has been used for

the enhancement of Strategic Road Asset Management. Establishments of the NTSA, and

EBK are also the considerable achievement of NCTIP, enhancing and facilitating the

provision of safe, reliable, and efficient road transport in the country.

8. Outcome indicator of PDO1 has not been fully achieved but there should have been

more PDO indicators to assess the first PDO adequately. Attainment level of intermediate

indicators is reasonably high. In addition, considerable benefits of the project related to

PDO1 are observed and overall project contribution to the road sector is remarkable.

Therefore, achievement of PDO1 is rated Substantial.

PDO2. Enhance Aviation Safety and Security to Meet International Standards

Rating: Substantial

9. The second PDO, ‘Enhance Aviation Safety and Security to Meet International

Standards’ was substantially achieved. The CAT1 certification is expected to be obtained

later in 2016 due to the considerable improvements in aviation safety and security.

10. The highest accomplishment in the aviation subsector under the NCTIP was the

security clearance from the TSA, which allows U.S. airlines to operate direct flights from/to

JKIA, one of the PDO2 outcome indicators. Such a measure is yet to be implemented due

to security conditions in the East Africa region, not related to the airport operation itself. In

parallel, the KCAA is on track to meet the FAA CAT1 requirement, which is another

outcome indicator, through the enhancement of its oversight capacity, especially in the area

of safety, with key staff recruited with the required qualifications and in adequate numbers.

As a result, the ICAO security audit in October 2015 scored Kenya, the KCAA and KAA a

rate of 88 percent, against a cut off rate of 80 percent for CAT1 certification.

11. Achievements of the intermediate indicators for this PDO are as follows: (i) JKIA

has met ICAO and USA TSA security requirements by obtaining higher score than cut off

rate for CAT1 certification; (ii) the number of passengers handled at JKIA has met the target

of 6.4 million in 2014; and (iii) the volume of cargo handled at JKIA has not met the target

since it slightly decreased from 278,000 tons in 2007 (baseline) to 260,000 tons in 2014 due

to external factors.29

28 Kenya’s Road Network is estimated at 161,451.3km. APRP 2015/16, KRB 29 Business Daily (2013) Chemical ban hits vegetable exports to the EU market, May 2013 http://www.businessdailyafrica.com/Dimethoatel-ban-hits-vegetable-exports-to-the-EU-market--/-/539546/1694416/-

/tf5vd1z/-/index.html.



43

12. The other key outputs of aviation-related components were: (a) the construction of a

new terminal building (Terminal 1A, formerly Terminal 4); (b) the construction of a three-

story car park at the airport, increasing its capacity to a total of 1,500 cars and grade parking

for 400 cars. The ground floor of the facility is temporarily used as the arrival hall after the

fire in 2013 until the opening of a new arrival hall which has been completed; (c) the

expansion of the aircraft parking (apron) and taxiways at JKIA, which increased the apron

space by 50 percent through the creation of 13 new stands for aircrafts, a fuel hydrant system,

and two new taxiways; (d) the upgrading of Kisumu airport into an international airport,

which increased the passenger capacity to 500,000; (e) the acquisition of security and safety

related equipment (for passengers and luggage screening; an access control system; material

for perimeter fencings for major airports; and flight information display systems); (f)

enhancement of the EASA, resulting in an ICAO accredited regional training center of

excellence as one of 16 training centers in the world; and (g) various feasibility and design

studies as well as works supervision contracts.

13. The following key achievements in the aviation sector reform also contributed to the

enhancement of aviation security and safety: (a) the creation of an airport security oversight

unit which is responsible for monitoring security issues and ensuring compliance with

security regulations; (b) the financial autonomy to both the KCAA and KAA which now

retain the revenues generated from their operations, which were previously remitted to the

government’s general revenue; (c) the improved security monitoring at key airports through

transferring the responsibility for passenger, baggage and mail security screening from the

police to the KAA; (d) the adoption of harmonized aviation safety and security regulations

by each member of the East African Community; and (e) the continuation of the KCAA

restructuring through the separation of its oversight functions from service provision

activities.

14. The activities under the aviation-related components significantly contributed to

improve aviation safety and security, with achievements of one of two PDO outcome

indicators and two out of three intermediates indicators. Thus, rating for PDO2 is assessed

Substantial.

PDO3. Promote Private Sector Participation in the Management, Financing, and

Maintenance of Road Assets

Rating: High

15. The third PDO has been clearly achieved through mainstreaming OPRC, and

obtaining legal endorsement on private sector participation in management, financing, and

maintenance of road assets.

16. The first outcome indicator for the third PDO, ‘awarding of an OPRC’ is considered

achieved. The implementation of performance-based contracts is apparent in the increased

level of private sector participation in the management and maintenance of road assets over

the course of the project. Although the process of the proposed OPRC under the project was

canceled, KeNHA and KURA are managing 18 and 21 contracts, respectively30, with the

total amount of KSh 794 million (US$7.4 million) in FY15 and FY16, and this approach is

30 According to the information obtained from KRB.

44

mainstreamed in road maintenance.

17. Another outcome indicator, offering one road segment of the Northern Corridor for

concession, has also achieved the targets. With the approval of the concession contract by

the parliament in 2009, this activity was further developed into a pipeline project with a total

estimated cost of US$960 million, which was supported by several donors: IDA partial risk

guarantee (US$120 million), Multilateral Investments Guarantee Agency (US$120 million),

International Finance Corporation (US$115 million), African Development Bank (AfDB)

(US$100 million), and IDA (US$100 million). Due to the unfavorable results of due

diligence from the Bank group, however, the GoK decided to terminate the process in 2011.

18. The intermediate indicator of PDO3 met the target, too. The project supported the

enactment of the Kenya Roads Act 2007 under the institutional reform of the transport

sector, and section 53 of the act clearly stated the encouragement of private sector

participation in road construction, maintenance, and management. In 2013, the GoK

established a Public-Private Partnership (PPP) Unit under the National Treasury through the

PPP Act of 2013 and toll road projects for Nairobi Southern Bypass and the Nairobi-Nakuru

Highway were included in 71 pipeline projects.

19. Thus, the contribution of the project to PDO3 is extensive even though both

processes under the project were canceled. Since PDO indicators and results indicator

achieved the targets, rate for PDO3 is High.

PDO4. Restore Vital Infrastructure and Assets Damaged as a result of the 2007 post-

election crisis

Rating: High

20. PDO4 was to support the post-election recovery program of GoK and assessed

accomplished successfully with the achievement of a PDO4 outcome indicator and one of

two intermediate indicators: renovation and reconstruction of Oyugis office, Homa Bay

office, and Kisumu office of KeNHA have been completed and all offices are in use while

the new construction of KeNHA regional office block in Kisumu has also been completed

and is in use. In total, four public buildings became functional against the target of three

buildings.

21. Another intermediate indicator, ‘awarding of 3 term contracts for disaster response

readiness’ has not been achieved though the Road Disaster Management and Response Unit

has been established and functions as a committee composed of representatives from road

authorities when a disaster occurs. However, since PDO4 is targeting only infrastructure and

assets damaged due to the post-election crisis, the accomplishment of this intermediate

indicator is irrelevant to the overall achievement of PDO4.

45

Annex 2d. Summary of Institutional Change/Strengthening

1. The project supported the transport sector reform and made remarkable contributions to

institutional strengthening. Notable results of institutional strengthening under the

NCTIP are summarized below:

NCTIP

supported the enactment of the Kenya Roads Act 2007 and establishment of three road

authorities: KeNHA, KURA, and KeRRA in 2008. With this reform, the ministry can

focus on policy formulation and oversight, and road authorities can focus on the

implementation of programs and projects;

supported MoTI to review the Traffic Act to ensure that it conforms to international

transport conventions as well as prepare and adopt an integrated transport policy;

supported the establishment and capacity building of the KMA;

assisted the KAA to be autonomous and financially independent, which allowed the KAA

to retain the revenues generated. The responsibility of security screening was transferred

from the police to the KAA;

assisted the KCAA to be autonomous and financially independent and enhanced its

capacity to comply with international standards and practice;

enhanced the capacity of the EASA, which has been accredited by the ICAO as a regional

training center of excellence. Such centers exist in Africa only in South Africa and Kenya,

and there are only 14 in the rest of the world;

supported the establishment of the Road Disaster Management and Response Unit under

MoTI (road department), which functions as a committee composed of representatives

from road authorities when a disaster occurs;

provided assistance for the KRB in conducting the (a) Road User Charges Study, (b) Road

Inventory/Road Reclassification Study, covering 160,886 km of roads, (c) Road Sector

Investment Program (RSIP), and (d) Transport Sector Indicator Framework Study;

supported the establishment and capacity building of the NCA through the enactment of

the National Construction Authority Act 2011 to regulate, streamline, and build capacity

in the construction industry;

supported the reform of the Engineers’ Registration Board and the establishment of the

EBK through the repeal of the Engineers Registration Act (1969) and the enactment of

the Engineers Act 2011 to widen the mandate of the EBK to oversee and regulate the

standards in the engineering profession and build capacity for individual engineers and

engineering firms;

supported the preparation of a National Road Safety Program and the establishment of

the NTSA through Parliament Act Number 33 to facilitate the provision of safe, reliable,

and efficient road transport services;

provided assistance for the enhancement of maritime training capacity in Bandari College,

which became one of the four accredited institutions for maritime education and training

in Kenya; and

assisted the University of Nairobi, through the M&E assignment, to enhance research

capacity and support more than 50 post-graduate students majoring in transport and set

up a transport data bank in the university.

46

Annex 3. Economic and Financial Analysis

1. This annex summarizes the ex-post economic analysis for the following two

components under the original credit and the AF: (i) the rehabilitation and improvement of

the Northern Corridor; and (ii) the expansion of JKIA. The road works, with a total length of

419.3 km, and the civil aviation related works account for about 72 percent, and 21 percent

of the total project cost, respectively.

3.1 Rehabilitation of the Northern Corridor (Component A)

2. Ex-post economic analysis of the road rehabilitation and improvement under the

project was conducted and obtained the following results: (i) the net present value (NPV) of

the rehabilitation and improvement program is US$550 million at a 12 percent discount rate;

and (ii) the overall economic internal rate of return (EIRR) over 30 years (2004-2033) is 39.1

percent, varying from 13.3 percent to 56.4 percent, depending on road section, as presented

in table 3.1.

Table 3.1. Summary of Economic Analysis*

*Note: Results presented for each road section and for the homogeneous road subsections were analyzed

separately in the HDM4 model.

3. The ex-post economic analysis demonstrates that the Project is economically justified

despite cost overruns. The overall EIRR is higher than those estimated at the beginning of the

project and the AF economic analysis. Total NPV is also higher than at appraisal or the AF.

Significantly higher than anticipated traffic growth is one of the main contributing factors for

the positive results of analysis. Details of economic analysis are described below.

Section

Length

(KM)

NPV

(US$M)IRR %

Section

Length

(KM)

NPV

(US$M)IRR %

Section

Length

(KM)

1. Maji ya Chumvi - Miritini 35 13 37 35 49.1 44.0 35 14.1 14.1 18.7 18.7

56.1 48.2

66.3 49.9

179.5 55.5

98.3 58.0

14.6 23.2

9.8 43.7

9.3 44.1

27.1 41.7

23.3 40.8

18.5 21.0

Sub Total (original credit component) 223 372.1 34 223

6. Mau Summit-Kericho 57 14.4 17.0 57 7.9 7.9 18.0 18.0

7.2 21.9

5.9 24.8

10.7 44.4

8 Airport North Road8 7 25

9. Nyamasaria-Kisumu Airport -Kisian 24 11.6 16.0 22 1.4 1.4 13.3 13.3

Sub total (AF component) 162 65.7 19.2 155

TOTAL 367 124 27 385 437.8 N/A 378

AF Ex-Post

NPV (US$M) IRR %

Road Section

PAD

142.1 39.0 33 277.8 56.4

55 36.6 28.0 55 122.4 49.1

4. Lanet-Njoro Turnoff

99

12

335. Njoro Turnoff-Timboroa

26

33

2. Sultan Hamud-Machakos Turnoff 55 13 23

3. Machakos Turn off-JKIA 33 31 28

84 47.1 28.0 84 68.9 31.6

16 97.2 37.0 16 33.7 29.7

23.5 76 23.9 27.8

Dropped Dropped

516.9 40.3

137 22 20

7. Kericho-Nyamasaria

81 39.7

33.2 22.3

550.0 39.1

47

4. Project objectives and main benefits. The expected outcome of the proposed road

works was to increase the efficiency of road transport along the Northern Corridor. The

rehabilitated and improved road sections covered about 40 percent of the regional corridor

within Kenya and improvements contributed to improved traffic flow and road safety. As

noted in section 3.2, the road rehabilitation and improvement has reduced travel times

between Mombasa and Malaba/Busia by 15 percent in 2015 and road-related fatalities per

100,000 people in Kenya, has decreased by 23 percent from 8.31 in 2008 to 6.4 in 2015.

5. Main assumptions and methodology. Net benefits were computed using the Highway

Development and Management Model (HDM-4), which simulated lifecycle conditions and

costs and provided economic decision criteria for multiple road design and maintenance

alternatives. The evaluation followed the same methodology as the ex-ante economic analysis

assessing road users’ benefits and actual construction cost, estimated maintenance cost, and

traffic data obtained from existing studies31. The discount rate was set to 12 percent and the

evaluation period to 30 years. The data were provided by KeNHA and were adjusted to reflect

actual road works costs, incorporate a more realistic maintenance program in the base

scenario, and reflect actual traffic growth to date.

6. The main benefits are the savings made by road users on vehicle operating costs,

maintenance cost, and passenger/freight time. The evaluation calculated these benefits to road

users and costs of the investments in road works as compared to a without-project scenario,

and assessed streams of a net economic benefit to a society. Additional benefits, which have

not been quantified, include the reduction of accidents, reduction of vehicle emissions such

as GHG, and the improvement of driving and riding comfort. The costs to the road agency

are the works costs.

7. Road section. The civil works consist of rehabilitating and improving eight road

sections, totaling 377.9 km (Maji ya Chumvi - Miritini; Sultan Hamud-Machakos Turnoff;

Machakos Turn off-JKIA; Lanet-Njoro Turnoff; Njoro Turnoff-Timboroa; Mau Summit-

Kericho; Kericho-Nyamasaria; and Nyamasaria-Kisumu Airport-Kisian section), 41.4 km of

which is dual carriageways. The above eight road sections are further categorized into sixteen

homogenous road sections in terms of traffic and road condition for evaluation in HDM4.

8. Traffic volume. The traffic volumes (Average Annual Daily Traffic) and the annual

traffic growth rates are presented in table 3.2. The base year of the traffic data (2003) and the

actual traffic data in 2014 and 2015 were utilized to calculate average annual traffic growth

rates for each mode for the years 2003 to 2014/15. The annual traffic growth rates of 5 and 4

percent were applied to all modes for the periods, year 12 /13 to 19 (2015/16-2022), and year

20 to 30 (2023-2033), respectively.

31 Traffic data has been extracted from the following studies:

JICA: Goods Movement and Vehicle Traffic Survey for Master Plan on Logistics in Northern Economic Corridor in the Republic

of Kenya (2015);

PricewaterhouseCoopers(PwC) Kenya Ltd.:- Transaction Advisory Services for the Development, Operation and Maintenance

of Mombasa Nairobi (A109) Highway on PPP basis (2015/16); and,

ITEC Engineering Ltd.:- Consultancy Services for Reviewing And Updating The Economic Feasibility Study Report of Ahero

– Kisii – Isebania (A1) Road (2015).

APEC Consortium Ltd.:- Consultancy Services To Undertake Traffic Surveys On the Entire Road Network for the Kenya Roads

Board (2014).

48

Table 3.2.Traffic Volumes in 2003, and 2014/2015 and Traffic Growth Rate

9. Estimating economic benefits. The economic benefits of road rehabilitation and

upgrading works are: (i) reduction in vehicle operating costs and (ii) travel time savings. The

project contributes to increased average traffic speeds as well as improved riding comfort.

Accordingly, the economic benefits from the road works consist of the reduction of the

following transport costs: (i) vehicle operating costs, mainly, reduction in consumption of

fuels and reduction of wear due to vibration during driving, and (ii) reduction in travel time

for passengers and freight, which is converted into monetary terms and added as economic

benefits.

10. In the HDM4 model, benefits are calculated as the difference in transport costs and

benefits between a with-project scenario (alternative case) and a without-project scenario

(base case). These two scenarios include the following works:

11. With-project scenario. The following rehabilitation and maintenance activities were

assumed in the model of the with-project scenario:

a. Rehabilitation and Improvement: Actual construction period data was utilized during

the road rehabilitation and improvement period. The reduction of the International

Roughness Index (IRI) has been simulated by the model once works have been

executed, and completed.

b. Maintenance: Annual routine maintenance includes: roadside cleaning, maintenance

of road facilities, and normal road patrol. Routine maintenance costs are assumed at

the same level for all road types. Along with the maintenance, regular patching will

be carried out if the pavement surface is damaged before reaching the roughness

threshold for rehabilitation.

12. Without-project or Base scenario. The AF economic analysis base scenario assumed

annual routine maintenance and reconstruction at IRI 12.0 would be performed. Given the

significance and classification of the corridor 32 , the AF scenario assumptions likely

understated the maintenance levels that would have taken place without the project. The base

32 The Northern Corridor is classified as international trunk roads (class A)

Light Medium Heavy Light Medium Heavy Light Medium Heavy

1. Maji ya Chumvi -

Miritini 404 767 163 468 163 803 27691,269 453 280 166 696 4,362 7,226

10.0% -4.3% 4.6% -8.3% 12.8% 15.1%

492 393 80 305 566 836 2672 1,803 496 216 352 792 4,246 7,905 11.4% 2.0% 8.6% 1.2% 2.8% 14.5%

492 393 80 305 566 836 2672 1,803 496 216 352 792 4,246 7,905 11.4% 2.0% 8.6% 1.2% 2.8% 14.5%

1397 917 474 994 894 1243 5919 6,066 3,475 1,061 2,414 1,431 6,768 21,215 14.3% 12.9% 7.6% 8.4% 4.4% 16.7%

3836 2388 673 2782 1308 1715 12702 9,244 3,955 989 4,632 2,178 3,657 24,655 7.6% 4.3% 3.3% 4.3% 4.3% 6.5%

5503 2779 603 859 491 926 11162 3,973 2,303 283 2,125 711 2,591 11,986 -2.9% -1.7% -6.6% 8.6% 3.4% 9.8%

8482 5042 634 768 801 968 16697 10,030 8,034 449 2,752 1,136 2,813 25,214 1.5% 4.3% -3.1% 12.3% 3.2% 10.2%

3614 1771 551 520 551 866 7873 6,479 4,287 349 2,099 1,124 3,517 17,855 5.5% 8.4% -4.1% 13.5% 6.7% 13.6%

1802 868 287 249 210 409 3825 2,119 1,422 410 793 524 2,168 7,436 1.5% 4.6% 3.3% 11.1% 8.7% 16.4%

1036 697 470 246 186 563 3199 2,119 1,422 410 793 524 2,168 7,436 6.7% 6.7% -1.2% 11.2% 9.9% 13.0%

404 253 174 133 94 406 1464 1,347 825 98 177 478 1,734 4,659 10.6% 10.3% -4.7% 2.4% 14.5% 12.9%

6. Mau Summit-

Kericho 621 328 230 397 224 198 19971,527 957 198 228 713 734 4,357

7.8% 9.3% -1.2% -4.5% 10.1% 11.6%

703 384 230 530 391 238 2477 1,527 957 198 228 713 734 4,357 6.7% 7.9% -1.3% -6.8% 5.1% 9.8%

548 385 141 366 215 196 1850 2,141 1,528 739 828 688 1,046 6,970 12.0% 12.2% 14.8% 7.0% 10.2% 15.0%

604 588 126 365 212 145 2040 2,774 2,267 834 1,189 847 1,211 9,122 13.5% 11.9% 17.0% 10.3% 12.2% 19.4%

8. Nyamasaria-

Kisumu Airport 604 588 126 365 212 145 20403,536 1,059 322 958 474 716 7,065

17.4% 5.5% 8.9% 9.2% 7.6% 15.6%

5. Njoro Turnoff-

Timboroa

7. Kericho-

Nyamasaria

Trucks Trucks

2.Sultan Hamud-

Machakos Turnoff

3. Machakos Turn

off-JKIA

4. Lanet-Njoro

Turnoff

Trucks

Road Section Car Matatu

Large

Bus Total

2003 2014/2015 Average Growth Ratio (2003-2014/15)

Car Matatu

Large

Bus Total Car Matatu

Large

Bus

49

scenario in the ex-post analysis was therefore amended based on more realistic assumptions.

The ex-post base scenario included the same routine annual maintenance and reconstruction

at IRI 12.0 as the AF base scenario and additional maintenance work of a 50 mm overlay at

IRI 6.5 after the completion year of rehabilitation and improvement in the project scenario.

To make the base scenario and with-project scenario comparable, the additional maintenance

in the base scenario is of the same type and costs as were assumed in the with-project scenario.

13. Road works costs. Rehabilitation and improvement costs were calculated from the

final construction cost. The economic cost (excluding taxes) was estimated as 78 percent of

financial cost, similar to the proportion estimated in the economic analysis of the AF. To

make the results comparable to the results at the appraisal and the AF, the economic costs

were converted into 2008 prices using the GDP deflator published by the Bank.

14. Maintenance works. The same costs of routine maintenance works, 50mm overlay,

double surface treatments utilized in the AF economic analysis were assumed in the ex-post

analysis.

15. Table 3.3 presents the road sections lengths, road works and base investments costs

at the appraisal, the AF and ex-post evaluation:

Table 3. 3. Road Sections and Investments Costs of NCTIP

16. Vehicle Operating Cost. Vehicle fleet characteristics and economic unit costs were

defined for six vehicle classes: (i) car, (ii) matatu, (iii) large bus, (iv) light truck, (v) medium

truck, and (vi) heavy truck. The following table presents typical road user unit costs for each

type of vehicle. The parameters are based on the economic analysis at the AF, reflecting 2008

costs.

Section

Length

(km)

Road Work

description

Road

Work

cost

(US$M)

Road work

unit cost (US$

M/km)

Section

Length

(km)

Road Work

description

Road

Work cost

(US$M)

Road work

unit cost

(US$

M/km)

Section

Length

(km)

Road Work

description

Road

Work cost

(US$M)

Road work

unit cost

(US$

M/km)

1. Maji ya Chumvi - Miritini 35 Rehabilitation 13.0 0.37 35 Rehabilitation 24.55 0.7 35Rehabilitation

and Widening 48.63 1.39

2. Sultan Hamud-Machakos Turnoff 55 Rehabilitation 24.7 0.45 55 Rehabilitation 39.20 0.71 55 Rehabilitation 65.23 1.19

3. Machakos Turn off-JKIA 34 Widening 35.0 1.04 33 Widening 61.57 1.87 33 Widening 115.39 3.50

4. Lanet-Njoro Turnoff 16 Widening 39.20 2.45 16Rehabilitation

and Widening54.68 3.42

5. Njoro Turnoff-Timboroa 84 Rehabilitation 56.55 0.67 84 Rehabilitation 83.36 0.99

6. Mau Summit-Kericho Rehabilitation 55 Rehabilitation 86.44 1.57 57 Rehabilitation 72.52 1.27

7. Kericho-Nyamasaria Rehabilitation 81 Rehabilitation 101.66 1.26 76 Rehabilitation 99.16 1.30

8. Airport North Road 8 Widening 10.0 1.30

8. Nyamasaria-Kisumu Airport n/a n/a n/a n/a 24Rehabilitation

and Widening 66.88 3.04 22

Rehabilitation

and Widening 70.26 3.32

TOTAL 368 161.8 383 476.05 378 609.23

Dropped Dropped

AF Ex-post

Road Section

PAD

99

137

37.1

42.0 0.31

Widening 0.71

Rehabilitation

0.32

Rehabilitation

and Widening

50

Table 3.4. Vehicle Fleet Characteristics and Economic Unit Costs

Car Matatu Large

Bus

Light

Truck

Mediu

m

Truck

Heavy

Truck

Vehicle Characteristics

Number of axles 2 2 3 2 2 3

Number of wheels 4 4 10 4 6 10

Average Operating Weight (ton) 1.6 3.2 12.6 5 12.3 25

Service Life (years) 6 6 7 10 8 8

Km driven per year 20,000 100,000 150,000 60,000 80,000 80,000

Hours driven per year 400 1,600 3,000 1,300 2,500 2,500

Number of passengers 2 12 40 0 0 0

ESA loading factor 0.00 0.10 1.20 0.03 4.30 4.60

Economic Costs in 2008 price

New vehicle price (US$) 19,300 24,325 77,075 34,783 65,217

135,26

3

New tire price (US$) 55 58 298 397 397 435

Fuel cost (US$/Liter) 0.78 0.78 0.78 0.78 0.78 0.78

Lubricants cost (US$/Liter) 2.08 2.08 2.08 2.08 2.08 2.08

Labor cost of maintenance (US$/hour) 7.38 7.38 7.38 7.38 9.53 9.53

Crew wage (US$/hour) 0.00 1.63 1.63 1.63 3.29 3.29

Time costs for working passenger (US$/hour) 1.80 0.67 0.67 0.67 0.67 0.67

Time costs for non- working passenger

(US$/hour) 0.45 0.18 0.18 0.18 0.18 0.18

Cargo time (US$/hour) 0.00 0.00 0.00 0.02 0.04 0.13

Annual Interest Rate (%) 12 12 12 12 12 12

3.2 Civil Aviation Component

17. The aviation components (Components F and G) in the PAD amounted to US$51.65

million, or some 18.6 percent of the original project costs. The PAD notes that the proposed

interventions were required for upgrading the aviation safety and security status based on

internationally accepted standards and were not subject to economic analysis given the non-

quantifiable benefits associated with increased safety and security.

18. The project paper (PP) for the 2009 AF confirmed the change in project scope from

December 2005, when permission was sought and agreed, by exchange of letter to replace

the proposed renovation of Old Embakasi Airport (Nairobi) and increase the expansion of

JKIA, adding the development of the Unit 4 Terminal and Car park, with corresponding

reallocation of the credit proceeds, from the former to the latter. The PP also noted the

expected benefits of the JKIA expansion comprise: (i) increased revenue for the KAA; (ii)

reduced congestion at the airport; (iii) increased safety and security; (iv) increased reliability

and reduced delays in passenger and cargo handling; and (v) multiplier effects of reduction

in the cost of doing business, particularly in the horticulture and fresh flower industries.

19. The PP presented the results of a feasibility study for all the interventions at JKIA.33

Whilst an economic analysis was not undertaken to ascertain whether it represented an

appropriate use of public investment, the PP reported the results of a financial analysis, which

33 Queens Qay Architects Intl Ltd (Canada) 2005 Jomo Kenyatta International Airport Terminal Master Plan, Design and

Construction Final Report, KAA, February 2005

51

estimated project costs of US$134 million, NPV (at 10% discount rate) of US$218 million,

and an IRR of 19 percent.

20. While the financial analysis has not been redone for the ICR, this result was predicated

on demand forecasts that predicted 5.5 million passengers (domestic, international and transit)

with an annual growth rate of 4.7 percent for 2011-2016 and 353,000 tons of air-freight by

2015. Actual data from KAA reveals that total passenger numbers through JKIA reached 6.4

million in 2014, an average annual growth rate of 6.4 percent, and cargo throughput reached

260,000 tons.

21. The actual growth in passenger numbers exceeded the demand forecasts in the high

scenario, despite the impact of the global economic slowdown and the fire at JKIA. The drop

in air-freight is at least partially due to the introduction of stricter European Union import

regulations concerning pesticide levels on fresh products (Dimethoate) 34 . The European

market accounts for up to 80 percent of Kenya’s fruit and vegetable sales and 42 percent of

flower exports.

22. While actual financial costs (US$270 million) exceeded estimated costs markedly, the

growth in passenger traffic, the increase in the Airport Passenger Service Charge, a levy

charged on each passenger to pay for the improvements, from US$20 to US$40, would be

expected to more than ensure the investment was financially viable.

34 Business Daily (2013)

52

Annex 4. Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members

Names Title Unit Responsibility/

Specialty

Lending

Anil Bhandari TTL AFTTR TTL

Josphat Sasia

Jean

Economist AFTTR Co TTL

Jean Francois Marteau Transport Specialist AFTTR Transport

Nina Chee Environment Specialist AFTES Environment

Amadou Konare Consultant/Environmental AFTES Environment

Moses Wasike Financial Management Specialist AFTFM Financial Management

Nyambura Githagui Sr. Social Develop. Specialist AFTES Social safeguard

Dahir E. Warsame Procurement Specialist AFTPC Procurement

Pascale Dubois Senior Counsel LEGAF Legal

Hisham A. Abdo Kahin Consultant/Counsel LEGAF Legal

Fabio Galli Sr. Financial Analyst SASEI Financial Management

Rodrigo Archondo-Callao Technical Specialist TUDTR Transport

Jaswant Channe Consultant/Highway Engineer SASEI Transport

James Karuiru Consultant/Infrastructure Eng. AFCO5 Infrastructure

Yoshi Kawasumi Consultant/Road Safety AFTTR Road Safety

Farida Khan Operations Analyst AFTTR Operations Analyst

Nina Jones Program Assistant AFTTR Program Assistant

Anne Njuguna Team Assistant AFTTR Team Assistant

Anne Odera Team Assistant AFCO5 Team Assistant

Hye Ra Kim Finance Analyst LOAG2 Finance

Hyacinth D. Brown Senior Finance Officer LOAG2 Finance

Marc Juhel Peer Reviewer TUDTR Peer Reviewer

Cesar Queiroz Peer Reviewer ECSIE Peer Reviewer

Henry Kerali Peer Reviewer ECSIE Peer Reviewer

Supervision/ICR

Josphat Sasia

Lead Transport Specialist GTIDR TTL

Fabio Galli Lead Transport Specialist GTIDR Transport

Nina Chee Lead Environmental Specialist OPSPF Environment

Anil Bhandari Consultant GGODR Team Member

Nyambura Githagui Lead Social Development Specialist GSU07 Safeguards

Dahir E. Warsame Senior Procurement Specialist AFTPC Team Member

James N. Karuiru Consultant GSU19 Team Member

Anne Khatimba Program Assistant AFCE2 Program Assistant

Jean Francois Marteau Program Leader ECCU5 Program Lead

Akiko Kishiue Urban Transport Specialist GTIDR ICR Team leader

Moses Sabuni Wasike Sr. Financial Management Specialist GGO21 Financial Management

Damon C. Luciano

<[email protected]>

Program Assistant GTIDR Team Member

Tim Ulrich Hartwig Consultant N/A Team Member

Amadou Konare Senior Environmental Specialist N/A Environment

Henry Amena Amuguni Sr. Financial Management Specialist GGO31 Financial Management

Masafumi Yabara Consultant N/A Team Member

Banu Setlur Senior Environmental Specialist GEN05 Environment

Diana M. Masone Operations Officer N/A Operation

53

Noreen Beg

Peter

Senior Environmental Specialist GEN 04 Environment

Peter Thinwa Warutere Senior Communications Officer AFRSC Communication

Shamis Salah Musingo Senior Executive Assistant AFCE2 Team Member

Armin Morz Consultant LCSTR Team Member

Silverster Kasuku Consultant N/A Social Development

Josephine Kabura Kamau Sr. Financial Management Specialist GGO31 Financial Management

Felly Akiiko Kaboyo Operations Analyst GPSOS Team Member

Josephine Kabura Ngigi Consultant GGODR Team Member

Lucy Kang’aura Program Assistant AFCE2 Team Member

Gibwa A. Kajubi Sr. Social Development Specialist GSURR Safeguards

Joel Buku Munyori Procurement Specialist GGO01 Procurement

Lucy Antango Musira Program Assistant AFCE2 Team Member

Charlene D’Aleida Consultant AFTTR Team Member

Samuel Iyasu Zerom Operations Analyst AFMRW Team Member

Solomon Muhuthu Waithaka Sr. Highway Engineer GTIDR TTL

Pascal Tegwa Procurement Specialist GGO01 Procurement

Rosemary Ngesa Otieno Program Assistant AFCE2 Team Member

Monica Gathoni Okwirry Program Assistant AFCE2 Team Member

Svetlana Khvostova

<[email protected]>

Natural Resources Mgmt. Spec GEN01 Safeguards

Tito Kodiaga Safeguard Specialist GSURR Safeguards

Justin Runji Senior Transport Specialist GTIDR Peer Reviewer

Kavita Sethi, Senior Transport Economist GTIDR Peer Reviewer

Natalya Stankevich Transport Specialist GTIDR Peer Reviewer

(b) Staff Time and Cost (from System)

Stage of Project

Cycle

Staff Time and Cost (Bank Budget Only)

No. of staff weeks US$, Thousands (including

travel and consultant costs)

Lending

FY03 15.32 87.2

FY04 50.81 262.7

Total: 66.18 349.9

Supervision/ICR

FY05 38.46 136.1

FY06 32.13 141.9

FY07 25.49 123.8

FY08 38.28 134.1

FY09 37.75 204.9

FY10 19.21 129.2

FY11 28.51 149.5

FY12 18.62 95.1

FY13 27.63 136.1

FY14 26.02 114.6

FY15 20.79 76.9

FY16 27.70 157.8

Total: 406.71 1,949.7

54

Annex 5. Beneficiary Survey Results Not applicable

55

Annex 6. Stakeholder Workshop Report and Results Not applicable

56

Annex 7. Summary of Borrower’s ICR and Comments on Draft ICR NORTHERN CORRIDOR TRANSPORT IMPROVEMENT PROJECT

(NCTIP)

Credit 3930-KE and Credit 4571-KE

Borrower's Implementation Completion and Results Report (ICR)

Date: March 31, 2016

(i) Background

Implementation period. The Financing Agreement for the Northern Corridor Transport Improvement

Project (NCTIP) became effective on September 16, 2004. The Development Credit Agreement was

amended and restated on May 8, 2009 so as to close on December 31, 2012. However, the government

requested the World Bank for an extension on September 21, 2012, which the Bank approved through

a letter dated January 3, 2013, and the implementation period was thus extended to December 31,

2015. The project NCTIP therefore became the longest running transport project under

implementation by the Ministry, with a total implementation period of eleven (11) years.

Justification for second extension of the implementation period. This extension was necessitated by

exogenous factors, which caused delays in completing the following major works contracts:

- Rehabilitation of the Northern Corridor comprising the Mau Summit-Kericho-Nyamasaria-

Kisumu-Kisian section. At the time of project preparation in 2003, the country was preparing

to go to elections and from 2003 to 2012 there was significant growth of traffic surpassing the

forecasted volumes partly due to the growth of the economy. This therefore necessitated

redesign of urban sections of the Northern Corridor to provide dual carriageways within major

towns of Mombasa, Nairobi, Nakuru, Kericho and Kisumu.

- Sub-components at Jomo Kenyatta International Airport (JKIA) mainly comprising

completion of Terminal T1A (international departures) co-financed by AFD.

Project Implementing Entities. There were four Project Implementing Entities (PIEs) namely: State

Department of Transport, Kenya National Highways Authority (KeNHA), Kenya Civil Aviation

Authority (KCAA) and Kenya Airports Authority (KAA). State Department of Infrastructure

coordinated the project.

Original Credit: US$ 207 million

Additional Credit: US$ 253million

Total Credit: US$ 460 million

Effectiveness date: September 16, 2004

Restating Development Credit Agreement: May 8, 2009

Approval of Extension of implementation period: January 3, 2013

Credit Closure date: December 31, 2015

Over the implementation period, the government put in substantial resources as counterpart funding,

running to about 35% of the total cost of the project (about US$ 250 million). This included

counterpart funding that went directly to finance the works and operational expenses by the Project

Implementing Entities (PIEs).

(ii) Project Development Objectives (PDOs) The revised PDOs were to: (i) increase the efficiency of road transport along the Northern Corridor

to facilitate trade and regional integration; (ii) enhance aviation safety and security to meet

international standards; (iii) promote private sector participation in the management, financing and

maintenance of road assets; and (iv) restore vital infrastructure and public assets damaged as a result

of the 2007 post-election crisis.

57

What is significant to note is that while the project was mainly road transport-oriented, the objectives

went beyond the traditional design as attested by indicators specifically touching on maritime,

aviation and other trade facilitative aspects of transport.

(iii) Key Design and Implementation Issues

Project complexity. This project had the longest implementation period, having started in 2004 and

closing on December 31, 2015. The project combined three sub-sectors in the transport sector namely

(i) roads, (ii) aviation and (iii) maritime. Such a design therefore needed proper planning and

commitment by the implementing entities.

Project design flexibility. Although challenging, the approach of an integrated transport project is

supported by the government and has been seen to produce positive results for Kenya.

During the currency of the project, reforms were carried out and some of the institutions established

through the project participated in implementation. This could not have been possible were it not for

project flexibility.

Following the political crisis that followed the general elections in December 2007, some critical

infrastructure and public assets, were damaged. The need to rehabilitate and replace the public assets

necessitated revision of the project development objectives (PDO) accordingly. Again, this was made

possible due to the project design flexibility.

The revision of PDOs and Additional Financing necessitated extension of the implementation period.

The 11-year duration was also partly due to other exogenous factors e.g. ongoing sector reforms as

well as the election violence of 2007/08, which temporarily slowed down progress.

(iv) Key Achievements of Project Development Objectives

The key achievements are listed below:

a) Roads sub-sector

Roads completed. A total of 419.3km of roads were rehabilitated/upgraded along the Northern

Corridor between Mombasa and Kisumu. This length was noted to be longer than what was targeted

at project design due to the inclusion of the additional lengths arising from dual carriageways.

Roads Completed

No. Road Section Rehabilitated Length (km)

1. Maji ya Chumvi – Miritini 35 + 5*

2. Lanet – Njoro Turnoff dualling 16 + 16*

3. Njoro Turnoff – Timboroa 84

4. Sultan Hamud – Machakos Turnoff 55

5. Machakos Turnoff – JKIA 33 + 12*

6. Kericho – Nyamasaria Road 76

7. Mau Summit – Kericho Road 57

8. Nyamasaria – Kisumu – Kisumu Airport 14.9 + 8.4*

9. Kisumu Airport – Kisian Road 7

Total length of roads completed 419.3

Note

5* - This is the length of road that is dual

Long term performance-based road maintenance contract. The concept of performance based

contract was new to Kenya. KeNHA sensitized consultants and contractors on long term performance

based road maintenance contract through workshops. The concept has been accepted in Kenya and

maintenance of newly constructed roads are to be under the performance based contract, e.g. Thika

Road.

58

Currently there are 12 long-term performance-based contracts awarded and under implementation.

This way, private sector participation in road construction, maintenance and management is

enhanced.

Road safety. The facilities constructed alongside the roads have greatly enhanced road safety. These

include footbridges, e.g. at Mlolongo, wide shoulders (1.5-2.0m), service lanes within build up areas

and street lighting. Other facilities were construction of proper bus and truck stops at key selected

locations.

Children’s Traffic Parks. Following the reforms under the Kenya Roads Act 2007 that saw to the

establishment of three Roads Authorities, the management of children’s traffic parks was moved to

Kenya Urban Roads Authority (KURA). Children Traffic Parks have therefore been under KURA

since 2009. Budgetary allocation for the same started in 2012 as tabulated bellow. Currently there are

six (6) in operation as follows: Nairobi, Nyeri, Embu, Kisumu, Kisii and Kakamega. The Authority

is currently rehabilitating Kisii Children’s Traffic Park, which has been in operation since the 1980s

to give it a face lift. An additional one is also being established in Nairobi at the junction of Outer

Ring Road/Kangundo Road under the ongoing Outer Ring Road expansion project financed by the

Government and African Development Bank (AfDB). KURA has used from the exchequer Kshs. 135

million from 2012 to 2015 and Kshs. 40 million budgeted in FY 2015/16, thus a total of Kshs. 175

million.

Budgetary Allocation to Children’s Traffic Parks Managed by KURA

Year Allocation Kshs. Million

2012 20.00

2013 25.00

2014 60.00

2015 30.00

2016 40.00

Total 175.00

The number of fatalities related to road accidents in 2015 was 3,057, about 3% less compared to the

2008 figures. Further, fatalities per 100,000 have been improved from 8.31 in 2008 to 6.4 in 2015.

Feasibility Studies: The design of the project was futuristic, allowing for design of roads to be

considered for implementation in the future. This was aimed at reducing lead time to project

implementation for the designed road sections.

All the feasibility and detailed engineering design studies on selected road sections were completed

as follows: (i) three sections on the Kenya-South Sudan Road from Lesseru to the Nadapal/Nakodok

border, length 601km, (ii) Kibwezi-Kitui-Mwingi-Maua-Isiolo, (iii) Narok-Northern Lakeside

Tanzania, and (iv) Mombasa Southern Bypass whose implementation is under financing by JICA.

The design of Lesseru-Nadapal/Nakodok Road under NCTIP played a significant role in facilitating

the quick preparation of the Eastern Africa Regional Transport, Trade and Development Facilitation

Project (EATTEDP). This project was prepared and approved in a very short time compared to other

projects that have been prepared within the transport sector. Before closure of NCTIP, the Financing

Agreement for EARTTDFP had already been declared effective. The lead time to closure of the road

upgrading contracts for the Bank-financed sections will also be significantly shorter than usual.

Transport Sector Reforms: The project supported reforms in the transport sector. This included the

enactment of Kenya Roads Act, 2007 which set the ground for establishing of the three roads

authorities (KeNHA, KURA, and KeRRA). Further, the reforms resulted in the enhancement of

Kenya Road Board (KRB), creation of the National Transport Safety Authority (NTSA), National

Construction Authority (NCA), and Engineers Board of Kenya (EBK). Consolidation of the transport

sector, which was previously managed by three Ministries namely, Transport, Roads, and Public

Works under the Ministry of Transport and Infrastructure in 2013, has also contributed to the

59

strengthening of the transport sector governance. These initiatives have brought efficiency in the

sector.

Roadside amenities. To facilitate socio-economic enhancement, markets were built along the

Northern Corridor at Taru and Awasi, three schools at Mlolongo, a community centre at Chepseon,

and a lorry park at Nyamasaria. Further, awareness campaigns were carried out for HIV and AIDS

Mitigation.

Emergency post-election reconstruction and recovery: Offices have been rehabilitated at Oyugis and

Hama Bay (two office blocks) and Kisumu. A new KeNHA regional office block in Kisumu has also

been completed.

Road Disaster Management and Response Unit: this unit was established under MoTI (Roads

Department) and functions as a committee composed of representatives from roads authorities when

a disaster occurs. The Disaster Management and Response Unit works with the National Disaster

Operational Centre when a disaster occurs.

b) Aviation Sub-sector

JKIA Terminal T1-A Construction. The construction of this new terminal improved capacity by 100%

to 5 million per year. The terminal was substantially completed in August 2014.

Parking facilities at JKIA. These were increased, adding a multi-storey parking facility for 1,500 cars

and at grade parking for 400 vehicles. The multi-storey parking facility was converted to a temporary

arrivals facility following the fire disaster incident at JKIA in August 2013.

Security and safety at JKIA. This was enhanced and the International Aviation Safety Assessment

(IASA) Category 1 clearance for KCAA and direct flights to/from United States of America (USA)

and United States Transportation Security Administration (TSA) security clearance is expected once

the process is completed.

Significant security improvements at JKIA were achieved by completing enhancement of passenger

screening. As a result, the ICAO security audit of October 2015 scored JKIA a high of 88%, against

a cut off of 80% for CAT1 certification.

Kisumu International Airport. The runway was extended from 2.0km to 3.3km and a new terminal

building of area 5,400 m2 was constructed. This upgrade resulted in capacity increase from about

70,000 to 300,000. The facility was opened in 2011.

Structural reform and capacity building of KCAA. Reforms at KCAA are still on-going. The revenues

of KCAA have been tripled between 2004 and 2015, which allows KCAA to recruit more inspectors.

The number of airworthiness inspectors and flight operations inspectors increased from 3 to 18 and

1 to 16, respectively. These changes will facilitate KCAA obtaining IASA Category 1 in the next

audit in 2016.

East African School of Aviation (EASA) enhanced its capacity and is now accredited by ICAO as a

regional training center of excellence. Such centers exist in Africa only in South Africa and Kenya

and 14 in the rest of the world.

c) Maritime Sub-sector

Support to Kenya Maritime Authority. The project supported the establishment of a new maritime

administration, KMA which was set up in June 2004 as the semi-autonomous agency in charge of

regulatory oversight of the Kenyan maritime industry.

Enhancement of Maritime Training Capacity (Bandari College). Procurement and installation of

navigation bridge simulator software and ICT equipment for Bandari College was completed.

Bandari College is now one of the four accredited institutions for Maritime Education and Training

in Kenya. Kenya is already listed in the white list countries based on proper implementation of ‘The

International Convention on Standards of Training, Certification and Watch-keeping for Seafarers of

60

1995’.

Kenya has been re-elected by the Assembly of the International Maritime Organization (IMO), into

its 40- Member Council under Category (C) for the 2016-2017 biennium.

Support for Implementation of Maritime Laws: Consultancy services to Draft Rules and Regulations

for seven Maritime Laws had resulted in development of regulations to improve the Maritime

Sector/Industry; enforcement of the merchant shipping Act; enhanced safety; strengthened the

capacity of the Kenya Maritime Authority; and enhanced Marine Environment Protection as well as

enhanced revenue generation for Kenya Maritime Authority.

Capacity building. Capacity building has been undertaken in all implementing entities across the

board. The two levels of capacity building are procurement and installation of IT and other equipment

as well as staff training. Training has been undertaken in various institutions on diverse topics and as

a result, achievement of project development objectives was realised. Kenya Airports Authority

trained a total of 171 staff between 2007 to 2015, Kenya Civil Aviation Authority 18 staff and the

Ministry of Transport trained 71 from 2005 to 2015. KeNHA trained 112 staff members. Under the

Engineers Board of Kenya, 8 staff members received training (4 attended engineers conference in

Singapore and Nigeria respectively and 4 went on a benchmarking trip to Tanzania), a stakeholder

conference was held at Kenya School of Government and the Strategic Plan for 2014 to 2019 was

launched in 2015.

Every year the Bank holds at least one disbursement and procurement clinic, which deal with

fiduciary issues and pointing out areas that the project implementation teams should improve on.

Further, during the annual FM supervision missions, Bank staff takes the implementing teams

through the requirements for proper financial management. Project Implementation Teams (PITs)

received training on financial and fiduciary management through disbursement and procurement

clinics that were organised at least once every calendar year by the World Bank. The following were

trained: KeNHA – 6 (4 technical, 1 finance and 1 procurement); MoTI(I) – 6 (2 technical, 3 finance

and 1 procurement); MoTI (T) – 9 (6 technical including 2 from KCAA, 3 finance including 1 from

KCAA).

M&E: The consulting division of the University of Nairobi Enterprises and Services (UNES) was

awarded the task of Monitoring and Evaluation for the project and has submitted a final draft report.

The choice of a public university to undertake monitoring and evaluation was another unique aspect

of the project design. By awarding the assignment to UNES, the then Ministry of Roads and the

World Bank intended to enhance the capacity of the University of Nairobi to undertake M&E of such

a complex project.

Overall Outcome Rating: Satisfactory. The Project Development Objectives were achieved.

(v) Overarching Themes, Other Outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development

Economic activities along the Northern Corridor increased as a result of the improved road

characteristics. This in essence worked to reduce poverty among residents. By constructing the

footbridge at Mlolongo for example, the numbers of accidents occurring at the section were reduced.

The two sides of the road were also socially integrated due to ease of movement of non-motorised

transport users.

(b) Institutional Change/Strengthening

Under the NCTIP the following institutions were established thereby strengthening the road transport

sector and construction:

1. Kenya National Highways Authority – to manage national highways;

61

2. Kenya Rural Roads Authority – to manage rural access roads;

3. Kenya Urban Roads Authority – to manage urban roads;

4. National Transport and Safety Authority – in charge of road safety;

5. National Construction Authority – regulation of construction industry;

6. Engineers Board of Kenya – to regulate the engineering profession.

The following institutions were strengthened to execute their mandate:

1. Materials and Testing Department – additional testing equipment supplied;

2. Kenya Institute of Highways and Building Technology – additional training equipment

supplied;

3. Mechanical and Transport Department – ICT equipment supplied;

4. Kenya Maritime Authority – enactment of treaties.

(c) Other Unintended Outcomes and Impacts (positive or negative)

1. The way projects are managed in the transport sector changed as a result of bringing

together various sub-sectors in the transport sector. Previously, each sub-sector planned

alone but through the NCTIP, this changed and it has now become a best practice.

2. When the project brought together aviation, maritime and road sub-sectors, another

dimension of transport planning hitherto unknown was established. The interconnectivity

of these sub-sectors has now been better understood.

(vi) Assessment of Risk to Development Outcome

Rating: Moderate. While the risk rating in the Project Appraisal Document was noted as substantial,

the Government has taken steps to ensure that sustainability of the facilities implemented under the

project is ascertained. These are: a) enhancement of the Road Maintenance Levy Fund (RMLF) by

Ksh.3.00 to Ksh.12.00, b) continuation of deepening of transport sector reforms by instituting various

measures e.g. formation of National Construction Authority to regulate the construction industry,

formation of the National Transport and Safety Authority for improved safety on the road, continued

implementation of the Integrated National Transport Policy, c) the Boards of the Roads Authorities

(KeNHA, KURA, KeRRA as well as KRB) are still in place as per the Kenya Roads Act, 2007, d)

the Constitution of Kenya, 2010 gives both levels of Government – National and County, mandates

over their respective jurisdictions to ensure that maintenance of roads is given priority.

Project sustainability - the government has instituted various measures to ensure that the project is

sustained. These include operationlisation of the Road Maintenance Levy Fund to provide funds for

maintenance of the road network. Further, stakeholders are involved during the planning process of

road works to ensure that the project components are sustained.

(vii) Assessment of Bank and Borrower Performance

Rating: Satisfactory. The implementation of the road rehabilitation projects was successfully

completed.

Bank Performance

(a) Bank Performance in Ensuring Quality at Entry (i.e. performance through lending phase)

Rating: Satisfactory. The NCTIP Credit was consistent with the Country Assistance Strategy (CAS)

and focused on economic growth and improving governance. The lending was packaged into a

Specific Investment Loan (SIL) since the borrower had well defined timetables for the

implementation of major physical investments.

62

(b) Quality of Supervision (including of fiduciary and safeguards policies)

Rating: Satisfactory. The selection of consultants and contractors was performed under Bank

regulations, which ensured quality. The Kenya National Audit Office (KENAO) audits the activities

and accounts of the projects in the Credit. Further, the Bank policies on safeguards are integrated in

the projects, which have safeguards experts to ensure compliance. The Bank reviews performance of

the executing agency twice a year in supervision support missions.

Overall Bank Performance: Satisfactory. The entire Credit has been applied to meet the Project

Development Objectives as detailed in the Project Appraisal Document.

Borrower Performance

(a) Government Performance

Rating: Satisfactory. The Government applied the Credit as documented in the Financing Agreement

with the World Bank and the Project Appraisal Document of 2004 as well as the Project Report of

2009 and completed the project components as intended. The National Treasury gave leadership in

ensuring that disbursements were well managed. Further, the Government provided the required

counterpart funding and even surpassed the ratios agreed in the Financing Agreement and thus outdid

the intended outcomes in some instances as reported in the Monitoring and Evaluation Report.

(b) Implementing Agencies Performance

Rating: Satisfactory. The Ministry of Transport and Infrastructure set up a Project Oversight

Committee (POC) to oversee the overall implementation of the project. The POC met on quarterly

basis and dealt with a cross-section of issues from various Project Implementing Entities (PIEs).

Members of the POC were the Chief Executive Officers of the PIEs, the Principal Secretaries for the

State Departments of Infrastructure and also Transport, and the Principal Secretary of the National

Treasury. The project was being coordinated by the State Department of Infrastructure, with the

Principal Secretary as chairman and the Principal Secretary (Transport) as co-chairman. The Project

Coordinator was the secretary to the POC. The Project Implementing Entities namely KeNHA, KAA,

KCAA, and MOTI (T) had set up a multi-disciplinary Project Implementation Teams (PITs) that

managed the implementation of NCTIP project components to completion.

Overall Borrower Performance: Satisfactory. The Credit has been fully utilized and the planned

physical works completed as intended. From the Monitoring and Evaluation results, the project was

noted to have performed well from the point of view of achieving the intended outcomes in the

results monitoring framework.

Overall performance of the transport sector has improved tremendously following the reforms carried

out in various sub-sectors. As an example, the Ministry of Transport and Infrastructure has been left

with the function of policy formulation and oversight while policy implementation has been taken up

by various roads authorities and other institutions under the Ministry. This has not only improved

service delivery but also governance. Over the period of the 11 years that the project was being

implemented, the sector saw increased levels of competitiveness in bidding processes. This has

resulted in significant savings in large value contracts. It is also worth noting that the perception of

Kenyans on the sector’s reputation has improved significantly.

(viii) Lessons Learned

The implementation of the NCTIP brought out some lessons that would be useful in current and future

projects:

i. Regular consultative meetings between Bank and PIEs – in the implementation of the various

projects there was need to review various project aspects such as costs and time. It was realized

that processing of such changes was better expedited by holding meetings to review the matter

at hand.

63

ii. Innovative scheduling of Credit funds – as a developing country, the Government would

occasionally experience slower than expected cash flow, which would lead to delayed

payments and subsequent claims. In this regard, the Bank agreed to reschedule the payment

to contractors such that most of the payments were brought forward. This had two major

benefits; works continued unhindered and claims were avoided and the borrower was able to

realize benefits of the rehabilitated road sections in good time.

iii. Establishment of a Project Oversight Committee (POC) – this Committee was constituted of

the Ministry of Transport and Infrastructure, the National Treasury, the CEOs and PIT leaders

of the various PIEs. It provided coordination and oversight among PIEs and provided peer

review during implementation of the project. Although the project was composed of several

sub-sectors of transport, all implementing entities agreed that project coordination was

smooth. Quarterly project meetings and the project coordinator were identified as the key

factors of smooth coordination of this complex project.

iv. Project decision making – there were some contracts that required difficult decisions like

termination, e.g. the Restoration of the Public Assets. It is a lesson learnt that such decisions

should be made in a timely manner in order to realize the project objectives.

v. Project design flexibility – although challenging, the approach of an integrated transport

project is supported by the government and has been seen to produce positive results for

Kenya. It is significant to note that during the currency of the project, reforms were carried

out and some of the institutions established through the project participated in implementation.

This could not have been possible but for project flexibility.

vi. Financial management - disbursements and counterpart funding. During project

implementation, procurement plans and disbursement projections will need to be strictly

adhered to as much as is practically possible. This will help reduce delays. Late release of the

exchequer for counterpart funding was seen to be a major drawback to implementation,

resulting in delayed payments and accrual of interest. Capacity at MOTI was an issue.

Resource Mobilization Sections were set up in the two departments of the Ministry of

Transport and Infrastructure to improve capacity and reduce delays. Good knowledge of

World Bank fiduciary and financial procedures was a prerequisite to successful

implementation.

vii. Design and implementation of large value contracts. It was noted that by addressing

institutional capacity constraints, it is possible to implement expanded project activities

effectively.

viii. Implementation duration – the NCTIP was implemented in a period, which has seen three

different governments and also with strong economic development, which generated more

transport movements than anticipated. The project teams and the World Bank were flexible

enough to respond to unexpected situations, modify the activities, and provide emergency

support.

ix. Project administration World Bank country office. The relationship of the Bank project

management team and the implementing entities was key to successful implementation.

Having the task Team Leader in the World Bank Country Office made consultation easier and

regular. Delays in issuance of the No Objections were kept at a minimum.

x. Co-financing by other development partners. The project was co-financed by the Nordic

Development Fund (NDF), European Investment Bank (EIB) and the Government. By the

World Bank taking the lead in project preparation amongst the development partners,

coordination was seamless.

xi. Project design replication. Designs of future projects can borrow from the lessons learned

from NCTIP with good results. While the NCTIP took long to implement, the impact it has

had as shown in the monitoring and evaluation final report indicates that it was highly

successful. The project was quite ambitious because it covered several subsectors of the

transport sector. Owing to the concerted efforts by the key players, the challenges arising from

its complexity were surmounted.

64

Borrower’s Comments on the Draft ICR (Letter from MoTI)

66

NORTHERN CORRIDOR TRANSPORT IMPROVEMENT PROJECT (NCTIP)

Cr. 4571-Ke and Cr. 3930-Ke

Borrower’s Comments on the Draft ICR35 Date: June 20, 2016

Below are the Borrower’s comments on the ICR:

(a) Intermediate outcome indicators:

Under Indicator 4: add to the list of achievement by December 2015 ‘1 footbridge at

Mlolongo’. This is reported as 100% achievement while in essence 300% was achieved

since 9 amenities were constructed.

- The Bank team will revise the achievement of indicator 4 accordingly.

Under Indicator 7: in our view, more than 10% reduction in road related fatalities was

achieved when measured from the internationally recognized rate per 100,000 population.

Noting that the traffic volume continued to grow from the base year to the end of the

project as noted in paragraph 44 therefore, it is not practical to state that the target was not

achieved while at the same time acknowledging that there was a reduction of 23% as per

100,000 population.

- Unfortunately, project indicator 4 set the target as the total number of road related

fatalities, not per 100,000 people. Therefore, the ICR needs to report as designed in the

Results Framework of the project. However, the data obtained from NTSA confirmed

the 23% reduction in fatalities per 100,000 people, the ICR included this information

in the report to support the positive result of project.

Under Indicator 10: further to achieving 100% of the target, also indicate that all road

works under the Roads Authorities are procured under open tender and thus the

opportunities are open to the public

- The Bank team will include the open tender in the comment section of Indicator 10.

(b) The Borrower notes the seriousness with which the Bank takes changes in the composition

of Project Technical Teams (PTT). Paragraph 38 of the ICR clarifies that the unilateral change in

leadership of the PTT in 2006 without consulting the Bank caused a delay in start-up activities of

road construction work. Changing the leadership without consulting the Bank was in contravention

to the legal agreement. This resulted in the signing of a Memorandum of Understanding on

transitional arrangements for the proposed change in the Ministry of Roads, Public Works and

Housing (MoRPWH) PTT. Moving forward, this is a good lesson to entities implementing

components under ongoing projects.

- The Bank team appreciates this comment.

(c) The Borrower notes the comments in paragraph 53 in regard to gaps observed in the project

M&E design and implementation. Concerns of the Bank and stakeholders on the quality and

timeliness of reporting were appreciated and this will be taken as a lesson learned for future projects.

Both the Borrower and the Bank will need to be more proactive in making critical decisions relating

to the implementation of M&E in order to improve performance monitoring.


35 The responses from the Bank team are inserted (texts in italic and bold).

67

(d) Paragraph 58: The street lighting, road furniture, landscaping, foot bridges, and construction

of drains for Nyamasaria – Kismu-Kisian road section including Kisumu Bypass (14.9 km, including

8.4 km of dual carriage way) had not been completed by end of the project and is scheduled for

completion in July 2016. The lorry park at Nyamasaria and market at Awasi are expected to be

completed by September 2016. Delay in their completion was as a result of budgetary constraints.

- The Bank team will update the information in the report (please see paragraph 60 of this report).

(e) Paragraph 63: As noted in the ICR, follow up of conclusion of the development of a 50-year

transport master plan and the remodeling of terminal 1-B, C and D, and the restructuring of KCAA

are being carried out. The Consultant for the 50-year transport master plan made a presentation of

the draft final master plan and stakeholders gave comments which are expected to be incorporated

by end of June 2016 and the report resubmitted to the Ministry. In regard to remodeling of T1B, C

and D, the Government wrote to the Bank requesting for a project preparation facility to complete

the design and the same is under consideration by the Bank. With respect to restructuring of KCAA,

a study on delinking of regulatory and service provision functions of KCAA was completed and

recommendations on the way forward made. The Ministry is following up the issue to ensure that

the Authority is restructured as intended.

- The Bank team takes note of this comment.

(f) Paragraph 70: you indicate that 389km of roads were rehabilitated while elsewhere

(paragraph 73) and in the Borrower’s contribution it is different. Please harmonise the figures.

- Total length is 419.3 km. Paragraph 70 in the draft ICR was referring to the total KM of road

rehabilitated with available IRI data in order to confirm the improved road condition which was

one of the achievements of the NCTIP. Since IRI is not available for the road section of

Nyamasaria-Kisumu-Kisian (21.9km, 8.4 km of which is dual carriageway) yet, total KM for 7

road sections is 389km (419.3km - 21.9km-8.4km). Please see annex 2c paragraph 3 of this report.

(g) Paragraph 71: Refer to comment (a) above.

- The Bank Team will include this point in the final document. (Please see table 3, paragraph

112, and annex 2c paragraph 4 of this report)

(h) Paragraph 77: It is worth mentioning the achievements under the East African School of

Aviation in respect to attaining the Centre of Excellence status, one of the 16 in the world as a result

of facilities majorly installed through NCTIP. The school’s capacity to train aviation professionals

within the region and develop curriculum for specialized courses has been enhanced.

- Thank you for pointing this out. The Bank team will include EASA’s achievement in section 3.2

in addition to annex 2d in the final report.

(i) Paragraph 115: We take note of the need to have adequate counterpart funding in order to

reduce project costs. This is a lesson learned and will be take into consideration for future projects.


(j) Paragraph 123: The need to staff the External Resource Sections in the Ministry has been

noted. Inadequate capacity in this regard was a source of delays in payment processing.


68

Annex 8. Comments of Co-financiers and Other Partners/Stakeholders

Co-financiers

1. There was no co-financier for the NCTIP.

Parallel financiers

2. The draft report was shared with the parallel financiers, NDF and AFD for their

comments. The NDF and AFD thanked the Bank for sharing the report and informed

that they had neither specific questions nor comments on the report. The AFD also

expressed their gratitude to the Bank’s project team for the quality of collaboration in

the implementation of Component F, ‘Support to KAA’.

69

Annex 9. List of Supporting Documents

Additional Financing Project Paper for the Northern Corridor Transport Improvement

Project, Report No. 43537-KE, March 5, 2009

Aide memoires, project progress reports, and implementation status reports of NCTIP

Annual Report, Kenya National Highways Authority 2014/15

Constitution of Kenya, 2010

Country Assistance Strategy, 2004–08, Report 29038-KE, May 2004

Country Partnership Strategy, FY2010–13, Report 52521-KE, March 2010

Country Partnership Strategy, 2014–18, Report 88940, June 2014

Development Credit Agreement, Northern Corridor Transport Improvement Project,

between Republic of Kenya and IDA, June 25, 2004

Feasibility Study and Preliminary Design for Upgrading of Facilities at Kisumu and

Wilson Airport Study and Rehabilitation/Upgrading of Airport Pavements Design Study

for Jomo Kenyatta International Airport, Kenya Airports Authority, November 2006

Financing Agreement (Amending and Restating Development Credit Agreement),

NCTIP, between Republic of Kenya and IDA, May 8, 2009

Guidelines for Reviewing World Bank Implementation Completion and Results Reports,

a Manual for Evaluators, last updated Aug 1, 2014

Implementation Completion Report Guidelines, OPCS, Aug 2006, last updated July 22,

2014

Integrated National Transport Policy, Ministry of Transport, 2009

Integrated Urban Development Master Plan for the City of Nairobi in the Republic of

Kenya, December 2014, Japan International Cooperation Agency (JICA)

International Roughness Index data, Kenya National Highways Authorities

Jomo Kenyatta International Airport Terminal Master Plan, Design and Construction

Final Report, KAA, February 2005

KAA Traffic Data and Analysis

Kenya Airports Authority Statistics

Kenya Facts and Figures, Kenya National Bureau of Statistics (for 2003–15 figures)

Kenya Transport Sector Memorandum (Volume I–III) 26444-KE

70

Kenya Urbanization Review, February 2016, The World Bank.

Midterm Review, Mission Report, May 2009. Second Medium Term Plan (2013–17),

Vision 2030, The Presidency, Ministry of Devolution and Planning, 2013

NCTIP Monitoring Report, University of Nairobi Enterprises and Services Limited,

March 2016

Northern Corridor Transit and Transport Coordination Agreement, October 2007

Northern Corridor Transit and Transport Coordination Authority

(http://www.ttcanc.org/), (travel time between Mombasa to Malaba and Busia, road

condition, traffic in weigh bridge)

Project Appraisal Document for a Northern Corridor Transport Improvement Project,

April 30, 2004

Road Act of 2007, Republic of Kenya

Road Maintenance and Trend, Kenya Roads Board

Road Safety Status Report 2015, January 2016, National Transport and Safety Authority,

Road Sector Investment Programme 2010–14, Ministry of Roads, Republic of Kenya

The State of Easter African Cities, 2014, UN-Habitat 2014

Traffic Act of Kenya, Revised Edition 2014

Vision 2030, Government of Kenya, 2007

Global Health Observatory data repository, Registered Vehicles Data by country 2013,

World Health Organization (http://apps.who.int/gho/data/node.main.A995)

http://apps.who.int/gho/data/node.main.A995

71

Annex 10. Road Sector Governance and Integrity Improvement Action Plan -

Implementation Status Risk Control/Action Status

1. Collusion and

bid rigging.

Client: (a) Use post-qualification, instead of

pre-qualification, to avoid advance

knowledge of the firms invited to bid.

(b) Public dissemination of the overall roads

program and business opportunities in the

road sector, reinforce government’s and

Bank’s commitment to fight corruption.

This will also include publication of the

project’s detailed and updated procurement

plan on the website.

Bank: (a) Engage an independent

procurement specialist charged with

reviewing bid specifications and bids for

Bank-funded contracts, and reporting

directly to MoF, MoR and Bank.

(b) Include the Bank’s audit rights in the

works contracts.

(c) Ensure works contracts are large enough

to attract international and large domestic

firms to bid.

(d) Ensure that contracts are not deliberately

split to circumvent the Bank’s prior review

thresholds or to limit competition.

Key monitoring indicator: Increase in the

number of qualified bids obtained [4-5]

Baseline: 2-3 bids

Client: (a) Post-qualification has

been used for all major civil

works contracts.

(b) The Client held two such

public dissemination workshops

(June 2004 and August 2005) and

participated in a third organized

by the Bank during its Public

Forum (October 2007).

Bank: (a) An independent

qualified procurement specialist,

financed by the Bank as an

adviser to the Bank’s team, has

reviewed all the bids as received:

(b) The Bank’s audit rights have

already been in Standard Bidding

Documents;(c) and (d) All major

contracts are more than US$30-

US$40 million each and are

sliced and/or packaged together to

attract international and large

domestic firms. This was adopted

for other Bank-financed projects

such as KTSSP.

Indicator: Number of bids

received increased for subsequent

similar Bank financed projects.

Under the KTSSP, average 10

bids have been obtained for six

road work tenders between 2010

and 2015. In 2016 under the

EARTTDFP, between 17 and 20

bids have been received for four

contracts.

2. Fraud and

Corruption in

the Road

Construction

Industry.

Client: (a) Establish a transparent, well

documented, and consistently implemented

system for debarment of poor performers

and contractors engaged in fraudulent and

corrupt practices through the NCA.

(b) Strengthen the Recipient’s capacity to

design and supervise the construction of

roads, with particular emphasis on quality

and contract management.

(c) Review on-going or recently completed

Client: (a) (i) This is already part

of the Function of the Public

Procurement Oversight Authority.

(ii) The NCA was established

under the project in 2011 to

regulate, streamline, and build

capacity in the construction

industry.

(b) The project had a training

component and a technical

72

contract(s) to check for fraud such as

unbalanced bid, use of substandard

materials, lower quantities used than paid

for, and other non-compliance with

specifications.

(d) Determine through an independent

survey why some bidders who buy bid

documents choose not to submit bids.

Bank: (a) A technical audit to be conducted

independently of the implementing agency

on all contracts.

(b) Strengthen the use of contractual

remedies, such as performance bonds, in

case of project delays and poor

performance.

Key monitoring indicator: Percentage of

government-funded projects completed on

time, within budget, and in compliance with

specifications (measured by periodic review

of random sample of large projects).

Baseline: Less than 40% completed on time

and within budget.

assistance component to

strengthen the capacity of

KeNHA.

(c) Reporting corruption system is

established in KeNHA’s website.

An Integrity Committee in

KeNHA undertakes training and

carries out surveys through

independent firms. Quarterly

reports are forwarded to Ethics

and Anti-Corruption Commission

(EACC).

(d) A survey has not been

undertaken.

Bank: (a) Internationally

recruited and qualified

engineering firms were selected

and performed day-to-day

independent certification of the

quality of works, payment

certificates and compliance with

contract terms.

(b) Unconditional performance

bonds were mandatory as

additional remedies should the

contractor perform poorly.

Indicator: At the stage of the

ICR, it is still a challenge for the

GoK to complete government-

funded projects on time and

within budget. Still less than 40%

were completed on time and

within budget.

3. Truck

Overloading –

lack of

enforcement and

corruption.

Client: (a) Review current efforts to address

corruption in control of axle loads,

recommend appropriate measures to

mitigate such risks, and examine the need

for additional weight control infrastructure,

preferably automated.

(b) Ensure that road designs are

commensurate with the prevailing traffic

and axle load projections.

(c) Institute a fine that is commensurate with

damages to the roads and additional

deterrent measures to ensure compliance.

(d) Establish quarterly and random

independent reviews of the weigh stations’

activities including fines imposed and

collected.

Client: (a) Management of 5

weighbridge clusters covering 9

weigh stations, with 11 fixed

weighbridges and 6 mobile

weighbridges by the private

sector through competitive

bidding. Automated systems

(weigh-in motion) have been

installed at four of the weigh

stations along the Northern

Corridor.

(b) Current road designs are

based on actual axle load surveys

and projected design life

equivalent standard axle loads,

which produce higher designs but

73

Key monitoring indicator: At least 50%

decrease in the percentage of overloaded

trucks traveling on the Northern Corridor.

Baseline: Will be established once the first

automated axle-load weighing station is

constructed and functioning - expected in

one year from credit effectiveness.

are more economic in the long

run.

(http://www.itsinternational.com/

categories/enforcement/features/k

enya-wim-system-cuts-four-days-

off-journey-times/

(c) The NCTTCA is monitoring

weighbridge compliance and

reporting at their website weekly

(http://top.ttcanc.org/)

Indicator: At four weighbridges

along the Northern Corridor,

average 95 % of compliance is

reported between October 2014

and December 2015.

4. Delays in Value

Added Tax

(VAT) refunds,

causing inflated

prices in

construction

bids.

Client: (a) Assess the amount of VAT

outstanding for reimbursement to

contractors and liaise with the MoF and the

Kenya Revenue Authority (KRA) to

establish a system to minimize delays.

(b) Provide guidance notes and instructions

to the contractors on VAT procedures and

timelines.

Key monitoring indicator: Time elapsed

between receipt of required VAT

documentation by the KRA and issue of

refund to contractors decreased by at least

50%.

Baseline: To be established by MoRPWH

after survey of local contractors (within 3–6

months of effectiveness).

(a) The project assisted in

mounting regular workshops to be

conducted by KRA for

contractors to explain procedures

and resolve any issues. The

President has directed that all the

outstanding eligible tax refunds

be made within the current fiscal

year and the KRA is

implementing the directive.

However, the NCTIP was

exempted from VAT. Hence

refunds were not applicable.

(b) A workshop was held in

November 2008 where the KRA

made a presentation to contractors

and consultants on VAT

procedures.

Indicator: Since this is beyond

the scope of the project, data has

not been collected under this ICR.

5. Weak due

diligence on

bidders. The

integrity and

past

performance of

contractors is a

key determinant

of fraud and

corruption risks.

Client: (a) The Recipient must increase its

efforts in conducting due diligence of

bidders, particularly with regard to past

performance, financial and technical

capacity, equipment holding, and

compliance with tax laws and site safety

regulations.

(b) Undertaking performance reviews to

ensure poor performers are identified.

Key monitoring indicator: Extra due

diligence in verifying qualifications and past

performance is carried out by the Recipient

(a) and (b)The project promoted

greater scrutiny, in line with the

provisions of the bidding

documents. The results have been

made public by KeNHA and the

Public Procurement Oversight

Authority.

Indicator: Extra due diligence in

verifying qualifications and past

performance has been carried out.

For example, companies under

temporary Bank suspension were

informed that they were ineligible

74

on all preferred bidders, as verified in the

bid evaluation reports.

Baseline: Insufficient due diligence on

companies bidding for roads contracts.

for Bank-financed contracts, and

none of them bid for the Mau

Summit-Kisumu contracts. This

requirement has been adopted for

subsequent Bank financed

projects: KTSSP and

EARTTDFP.

6. Absence of

robust cost

estimates.

Client: (a) Cost estimates should be

developed from first principles and adjusted

for prevailing market conditions and, if

possible, also comparable to markets in the

region (i.e. East Africa).

(b) Hire a consultant to develop new, robust

cost-estimates and regularly update the cost

methodology and estimates as necessary to

reflect prevailing market conditions.

(c) Exercise the audit rights under the

contract to review true cost structure of

recently completed projects.

Key monitoring indicators: Robust cost

estimates developed; capacity developed in

National Highways Authority to monitor

actual costs obtained in the field.

Baseline: There is no systematic monitoring

of unit costs by the MoRPWH.

(a) and (b) The Cost Estimation

Manual for road maintenance

works has been developed and

published in 2011. The KRB

prepared a concept paper for the

development of a road works

construction cost index (RCCI)

and drafted the terms of reference

(TORs) for an RCCI Committee

to develop the RCCI and advise

the road sector on the RCCI

trend. The RCCI will cover road

development and maintenance

interventions carried out by the

road agencies in every financial

year.

(c) The contract provisions

already in the Standard Bidding

Document of the Bank permit

such an audit and an independent

review will be undertaken

according to item 2(c).

Indicators: Cost estimation

manual for road maintenance

works has been published.

Concept paper for the

development of a road works

construction cost index has been

prepared. Capacity of KeNHA

has been increased.

7. Weak capacity

to detect and

deal with fraud

and corruption.

Bank (a) Facilitate training workshops

focused on identifying red flags and

establishing controls in procurement,

financial management, and human resource

management particularly in the road sector,

including prevention of fraud in works

contracts.

Key monitoring indicators: At least three

(3) key people from each of the four (4)

Project Technical Teams have participated

in the training workshops.

Indicators: 24 key staff from

each of the four PTT participated

in the training workshop: KeNHA

– 6 (4 technical, 1finance and 1

procurement); MoTI(I) – 6 (2

technical, 3 finance and 1

procurement): and MoTI (T) – 12

(6 technical including 2 from

KCAA, 3 finance including 1

from KCAA)

75

Baseline: No training has taken place.

8. Weak complaint

handling

mechanisms.

Client: (a) Strengthen systems to handle and

effectively respond to complaints in a timely

manner.

(b) Establish and implement a

communications strategy to build awareness

of fraud and corruption and provide the

means for all parties to register their

complaints.

(c) Encourage the appropriate authority to

institute strong whistleblower protection

regulations.

Key monitoring indicators: (a) Internet-

based complaint lodging system established.

(b) NCA established and functioning

satisfactorily as judged from its annual

reports.

Baselines: (a) There is no Internet-based

complaint lodging system. (b) There is no

construction authority to register and

monitor contractors.

Client ((a),(b), (c)) and

Indicator: The NCA has been established

and has set up a complaints

handling mechanism. A

complaint form can be picked up

from and submitted to complaint

desk of the NCA office or

through emails. The complaints

submitted are logged into an

official complaint register and

responded to within 7 days.

http://www.nca.go.ke/index.php/a

bout-nca/complaint-handling-

mechanisim

9. Weak road

management

capacity.

Client: (a) Strengthen planning,

programming, budgeting, execution,

monitoring, and evaluation capacity of the

road agency.

(b) Ensure the key positions for the three

roads authorities are selected through a

competitive process based on their

qualifications against the established TOR.

Key monitoring indicators: (a) Key staff in

the National Roads Authority, Rural Roads

Authority, and Urban Roads Authority are

in place, and trained in work program and

budget planning, execution, monitoring and

evaluation. (b) Annual work programs,

budgets and progress reports are prepared

and published.

Baseline: The three roads authorities are not

yet fully functional.

Client: (a) Legislation has been

enacted (Kenya Roads Act 2007)

which provided for the

establishment of the three

autonomous roads authorities—

KeNHA, KeRRA, and KURA.

(b) Key positions of KeNHA,

KURA, and KeRRA have been

filled through a competitive

process based on qualifications

against the established TOR.

Indicators: KeNHA, KURA, and

KeRRA prepare annual road

works programs and submit to the

KRB, which reviews the annual

road works programs and

consolidates them into an APRP.

The APRP is published in the

website of the KRB.

10. Overall

transparency

and social

monitoring of

the road

construction.

Client, Bank, Civil Society: (a) Take

additional practical steps to foster a culture

of transparency and probity in the road

subsector.

(b) Establish a communications strategy

through radio programs and talk shows

where the issues facing the road sector are

discussed and the general public is asked to

participate through expressing their views

and comments.

Indicators: (a) Work program,

tender notices and awards, and

vacancy announcements are

placed in the websites of KeNHA

and KRB and overall

transparency and social

monitoring of the road

construction have been promoted.

(b) Road user satisfaction survey,

which involves an NGO/civil

society organization was planned

76

Key monitoring indicator: (a)

Communication strategy in place and (b) at

least two road-user satisfaction surveys

carried out during project implementation,

by NGO/Civil Society Organization.

Baseline: No system in place for

transparency and social monitoring of road

construction outside of MoRPWH.

to be conducted with the research

funds from Governance and

Anticorruption unit. However, the

funds were not allocated and the

survey was not conducted.

77

MAP

World Bank Document · document of the world bank report no: icr00002771 implementation completion...

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