african development bank - afdb
TRANSCRIPT
AFRICAN DEVELOPMENT BANK
TUNISIA
NORTH-WEST ROAD CONNECTIVITY SUPPORT PROJECT
APPRAISAL REPORT
RDGN/PICU
November 2017
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TABLE OF CONTENTS
Currency equivalents .................................................................................................................. i
Fiscal year ................................................................................................................................... i
Weights and measures................................................................................................................. i
Acronyms and abbreviations...................................................................................................... ii
I - STRATEGIC THRUSTS AND RATIONALE................................................................. 1
1.1 Key Development Issues.................................................................................................. 1
1.2 Project linkages with country strategy and objectives ..................................................... 1
1.3 Rationale for Bank intervention…………………………………………………… 2
1.4 Aid Coordination ............................................................................................................. 3
II -PROJECT DESCRIPTION ............................................................................................... 4
2.1 Project objectives and components .................................................................................. 4
2.2 Technical solution adopted and alternatives explored ..................................................... 5
2.3 Project type ...................................................................................................................... 5
2.4 Project cost and financing arrangements ......................................................................... 5
2.5 Project area and beneficiaries .......................................................................................... 7
2.6 Consideration of Bank Group experience and lessons learned in project design ............ 8
2.7 Key Performance Indicators ............................................................................................ 9
III - PROJECT FEAISIBILITY........................................................................................... 10
3.1 Economic and financial performance ............................................................................ 10
3.2 Environmental impacts, climate change and social issues............................................. 11
IV - IMPLEMENTATION.................................................................................................... 13
4.1 Implementation arrangements ........................................................................................ 13
4.2 Procurement Arrangements ........................................................................................... 13
4.3 Financial Management Arrangements ........................................................................... 15
4.4 Monitoring .................................................................................................................... 16
4.5 Governance ................................................................................................................... 16
4.6 Sustainability ................................................................................................................. 17
4.7 Risk mnagement............................................................................................................. 17
4.8 Knowledge building ....................................................................................................... 18
V - IMPLEMENTATION ..................................................................................................... 18
5.1.Legal instrument ............................................................................................................ 18
5.2.Conditions associated with Bank intervention ............................................................... 18
5.3.Compliance with Bank policies ..................................................................................... 21
VI – RECOMMENDATION ................................................................................................ 21
Appendix I: Description of the planned developments
Appendix II: Country Financing Parameters
Appendix III: Project cost and financing arrangements
Appendix IV. Supporting documents and scope of the requested authorization from the Board
for the use of EIB's procurement system
Appendix V: Regional development indicator
Appendix VI: Tunisia: Comparative socio-economic indicators
Appendix VII: AfDB Portfolio Table in Tunisia
Appendix VIII: Project area map
LIST OF TABLES
Table 1.1: Donor contribution to the financing of the sub-sector road programme
Table 2.1: - Project components
Table 2.2: Alternative solutions explored and reasons for rejection
Table 2.3: Estimated cost by component, exclusive of taxes for AfDB financed
Table 2.4: Source of project financing
Table 2.5: Summary of the estimated cost per component of the entire project
Table 2.6: Summary of Cost per Categories of expense for ADB Financing
Table 2.7: Schedule of expenditure by source of funding (Million EUR) for the entire project
Table 3.1: Outcomes of the economic analysis
Table 3.2: Country Financing Parameters
i
Currency Equivalents (June 2017)
Unit of account 1 = 3.38997 TND
Unit of account 1 = 1.23369 EUR
Unit of account 1 = 1.38432 USD
EUR 1 = 1.1211 USD
EUR = 2.747 TND
Fiscal Year
1 January – 31 December
Weights and Measures
1 metre (m) = 3.28 feet
1 millimetre (mm) = 0.03937 inch
1 kilometre (km) = 0.62 mile
ii
Acronyms and Abbreviations
ADEB Budget Decision Support
AfDB African Development Bank
AFESD Arab Fund for Economic and Social Development
AGTF Africa Growing Together Fund
ANPE National Agency for Environmental Protection
BTP Public Works and Civil Engineering
CBDs Competitive Bidding Documents
CSP Country Strategy Paper
DGPC Directorate-General for Highways and Civil Engineering
DREHAT Regional Directorate for Infrastructure, Housing and Regional Development
EIB European Investment Bank
ERR Economic Rate of Return
ESIA Environmental and Social Impact Assessment
ESMP Environmental and Social Management Plan
EUR Euros
GDP Gross Domestic Product
GENIS Road Maintenance Management by Service Levels
GHG Greenhouse Gases
HDV Heavy Duty Vehicle
MDICI Ministry of Development, Investment and International Cooperation
MEHAT Ministry of Infrastructure, Housing and Regional Planning
NPV Net Present Value
PACR North-East Road Connectivity Support Project
PADRCE Regional Development and Job Creation Support Programme
PAP Project-Affected Person
PDAI Integrated Agricultural Development Project
PIA Project Impact Area
PMIR Road Infrastructure Modernization Project
PMU Project Management Unit
PP Procurement Plan
RPF Resettlement Policy Framework
SDAG Sub-Directorate for General Affairs
TAF/MIC Technical Assistance Fund for Middle Income Countries
TND Tunisian Dinars
ToR Terms of Reference
UA Unit of Account
USD United States Dollar
VOC Vehicle Operating Cost
WB World Bank
iii
Project Information Sheet
Client information
BORROWER: Tunisia
EXECUTING AGENCY: Ministry of Infrastructure, Housing and Regional
Planning, acting through the Directorate-General for
Highways and Civil Engineering (DGPC)
Financing Plan
Source Amount Instrument
AfDB
EUR 122.000 million
Loan
EIB EUR 123 million Loan
Government EUR 32.29 million Self-financing
TOTAL COST EUR 277.29 million
Key AfDB Financial Information
Loan Currency Euro (EUR) [or any other acceptable currency]
Interest Type Fully flexible loan
Maturity To be determined (up to 25 years maximum)
Grace Period To be determined (up to 8 years maximum)
Weighted Average Maturity **: To be determined (based on the amortization
profile)
Refunds Semi-annual installments after the grace period
Interest Rate Base rate + Margin on financing cost + Loan
margin + Maturity premium. This interest rate must
be greater than or equal to zero.
Base Rate Floating (EURIBOR 6 Months revised on 1st
February and 1st August or any other acceptable
rate). A free option is offered to set the base rate
Financing Cost Margin Revised Bank Financing Cost Margin on 1st
January and 1st July and applied on 1st February and
1st August with base rate.
Loan margin 80 basis points (0.8%)
Maturity Primium To be determined:
0%, if the weighted average maturity <= 12.75
years
- 0.10%, if 12.75 <weighted average maturity <=
15
- 0.20%, if the weighted average maturity> 15
years
Front End Fee 0.25% of the loan amount.
iv
Commitment Fee 0.25% per annum of the undisbursed amount. It
begins to run 60 days after the date of signature of
the loan agreement and is payable on the interest
payment dates.
Base rate conversion option * In addition to the free option to set the base rate, the
option is offered to the borrower to return to the
floating rate or reset all or part of the loan amount
disbursed. Transaction fees are payable.
Rate ceiling or tunnel option *: The option is offered to the borrower to put a
ceiling or tunnel on the base rate for all or part of
the amount disbursed from his loan. Transaction
fees are payable
Conversion option of loan currency *:
The option is offered to the borrower to change the
currency of all or part of his loan, disbursed or not,
into another loan currency of the Bank. Transaction
fees are payable
*Conversion options and related transaction fees are governed by the Bank Conversion
Guidelines available on the website
**A weighted average maturity calculator is available on the website
Timeframe – Main Milestones (expected)
Activity Date
Concept Note Approval April 2017
Loan Agreement Negotiations November 2017
Board Presentation November 2017
Effectiveness January 2018
Closing Date 31 December 2023
Completion Report December 2022
v
EXECUTIVE SUMMARY
1. Project Overview
1.1. The North-East Road Connectivity Support Project (PACR) is part of Tunisia's road
sub-sector strategy and supports two of the five pillars of the country's Development Strategy
Plan for the period 2016-2020. The PACR consists of the construction of a 9 km-long two-
way, two-lane (2x2) suburban highway on a new alignment bypassing the city of Bizerte to the
southwest. The new bypass will link Highway 4 and National Road 8 to Local Road 438 at the
western access to the city. The project also includes a 2.1 km-long viaduct bridge over Lake
Bizerte and access roads at both ends of the structure totalling 7.4 km. It also comprises four
interchanges, a new 1.5 km-long service road, an operations centre, a maintenance centre and
ancillary developments, in particular: (i) the construction, on the south bank, of a 2.4 km-long
asphalted road linking South Zarzouna and the Technopole in North Zarzouna and Menzel
Abderahman; (ii) the construction of a 25 000 m² landscaped park under the bridge in Zarzouna
on the left bank of the lake, which will serve as a green recreation area; and (iii) the construction
of 14 km of secondary roads, 8 km of rainwater drainage system and provision of public
lighting with the installation of 300 lighting points in the neighbourhoods crossed.
1.2. The total project cost, net of taxes and customs duties, is estimated at TND 761.72
million, equivalent to EUR 277.29 million. The project will be implemented over a period of 5
years. The project will be financed by the EIB, AfDB, and the Government of Tunisia. On 15
November 2016, the EIB approved financing for the project worth EUR 123 million. The Bank
will provide supplementary financing amounting to EUR 122.00 million under the AfDB
window. The Government will supplement the financing plan with the sum of EUR 32.29
million.
2. Needs Assessment
2.1. The PACR is a flagship project under the Development Strategy Plan (DSP). Its
implementation will: (i) improve the competitiveness of the Tunisian economy by addressing
the growing demand in terms of goods and passenger traffic, which currently crosses the
Bizerte urban area, and help to ease congestion on the access road to the three industrial areas
and the port, as well as ensure better sharing of network loads; and (ii) foster mobility and trade
between the Centre, North Eastern regions of the country.
2.2. The PACR is consistent with the 2017-2021 CSP for Tunisia and is in line with the
two pillars adopted, namely: (i) industrialization and value chains development; and (ii)
improvement of the quality of life for the people of the priority regions.
2.3. In light of the expected benefits, the PACR is also in line with the Bank's Ten-Year Strategy
for 2013-2022, especially with some of its operational pillars namely; infrastructure
development, transition to green growth by reducing carbon emissions, and interconnection
between centre and north-west regions of the country and between Tunisia and the rest of the
world, and this implies developing the Bizerte port which will support Tunisia’s new economic
orientation towards development with the rest of the continent.
2.4 Lastly, it is in line with three of the Bank's high fives, namely: (i) "Industrialize
Africa" by enabling the development of the three industrial zones where more than 60% of the
facilities are export-oriented; (ii) "Improve the quality of life for African People" by reducing
congestion costs, rehabilitating certain neighbourhoods and creating a recreational area; and
lastly (iii) "Feed Africa" by upgrading agricultural land in the project’s area of influence and
processing production surplus. It is also in line with the thematic strategy for youth employment
in Africa 2016-2025.
vi
3. Bank’s Value Added
The PACR would enable the Bank to consolidate its position as a partner of choice in Tunisia’s
road sector. The Bank assists the Government through physical interventions in all three modes
of transport: road, air and rail, as well as through support in the area of policy and institutional
reform. However, this assistance is more pronounced in the road sector where the Bank,
through its five previous interventions in the form of loans, has helped to modernize more than
70% of the Tunisia’s network of asphalted roads. Also, through the three grants already
provided, the Bank is helping the Government to develop (i) a long-term vision for the sector
through the implementation of a transport plan; (ii) roads sector management reforms; and (iii)
new standards for road construction to improve the resilience of road infrastructure to climate
change impact.
4. Knowledge Management
4.1. The project is the first of its kind and the most complex in Tunisia both in terms of its
engineering and work site organization. Indeed, the nature of its foundations (piles 60 m deep
and 2.5 m in diameter), the great length of its spans (270 m), and also the safety standards
against possible ship collisions make it the first project of this magnitude in Tunisia and one of
the longest viaducts in Africa. Its implementation will result in knowledge building in various
fields. The measures taken within the context of the project, both in terms of the composition
of the Project Management Unit (PMU) and end-of-course engineering projects and vocational
training for young people will contribute to knowledge. The line ministry also plans to ensure
the large-scale dissemination of best practices learned during the implementation of this project
relating to major infrastructure construction projects. The dissemination will be carried out
through a website dedicated for that purpose, briefing notes and conferences with professional
and training organizations.
4.2. The effects of the impacts, which will be quantified under the monitoring/evaluation
sub-component, will ensure an assessment of the level of achievement of the project objectives,
and will be integrated into the broader framework of all previous Bank interventions. In order
to measure the impact on the development of Bank operations, particularly in its five priority
areas of action.
vii
RESULTS-BASED LOGICAL FRAMEWORK Country and Project Name: Tunisia, North-East Road Connectivity Support Project Project Goal: Improve the movement of goods and people in the Bizerte and Beja Governorates
RESULTS CHAIN
PERFORMANCE INDICATORS
MEANS OF VERIFICATION RISKS/MITIGATION
MEASURES Indicator
(including CSIs)) Baseline (2017) Target (2021)
IMP
AC
T
Improve the competitiveness of
the Tunisian Economy
1. Global Competitiveness Index (GCI)
(ranking/score 1 to 7)
2. Logistics Performance Index (LPI)
(ranking/score 1 to 5)
1. Global Competitiveness
Index (GCI): 3.9
2. Logistics Performance Index
(LPI): 2.5
1. GCI: 4.2
2. LPI: 3.0
(i). World Bank/AfDB
(ii). National statistics
OU
TC
OM
ES
1. Reduce congestion at peak
periods
2. Reduce accidents
3. Improve the living
conditions of the population
of the Bizerte and Beja
Governorates
1. Time saving
2. Number of fatal accidents on the
existing urban network per year
3.1. Number of direct jobs created per
year during the construction
3.2. Number of interns trained
3.3. Regional Development Index (RDI)
(0 to 1)
3.4. Reduction of transport-related CO2
emissions
1. 8.5 million h/yr
2. 8
3.1. 0
3.2. 0
3.3. 0
3.4. 0
1. 6.5 million h/yr.
2. 4
3.1. 700 men/month, at least
10% of performed by
women
3.2. 100 including 20 girls
3.3. 0.70 and 0.65
3.4. 33 000 t/yr.
(i). Monitoring and
evaluation
(ii). Statistics from ONSR
(iii). CO2 recording
(iv). CRP
OU
TP
UT
S
Output 1: New infrastructure
constructed
1.1. Length of roads constructed
1.2. Length of viaduct constructed
1.3. Ancillary developments
carried out
1.1. 0 km
1.2. 0 km
1.3. 0
1.1. 7.34 km
1.2. 2.11 km
1.3.1. 14 km of secondary
roads
(i) 1.3.2 8 km of rainwater
drainage system built
(ii) 300 lighting points
installed
(iii) 1.3.3 Development of a
recreational green space
of an area of 25 000 m²
(iv) (i) Works acceptance
report
(v) (ii) Reports by the
Project Management
Unit
(vi) (iii) CRP of the project
(vii) (i) Works acceptance
report
(viii)(ii) Supervision and
audit reports
(ix) (iii) ESMP
implementation reports
Risks
(i) Implementation delays: The
use of EIB procurement rules, the
project's lead financier, poses the
risk of delays in the mobilization
of companies, and lack of
proactivity in the processing of
requests from the Executing
Agency.
(ii) Cost overruns due to
physical contingencies or slow
pace of project implementation.
Mitigation measures
(i) Implementation delays:
This risk is mitigated by (i) a
viii
Output 2: Mitigation of the
environmental and social impacts
act of the project
2.1 ESMP implementation monitoring
report;
2.2 Strengthening of the canal bank
protection
2.4 Tree planting.
2.5 Compensation and resettlement of
project-affected persons
2.1 0
2.2 0
2.3
2.4 0
2.1 48 reports ;
2.2 2 500 ml
2.3 9 750 trees
2.4 1 309 PAPs
compensated and resettled
protocol agreement between the
AfDB and the EIB identifying
the roles and responsibilities of
each donor; and (ii) regular
consultations during
supervisions or on an ad hoc
basis.
(ii) Cost Overruns: This risk is
mitigated by the detailed studies
conducted by experienced
consultants. Cost estimates also
provided for physical and
financial contingencies which
would cover possible cost
overruns.
COMPONENTS RESOURCES (EUR MILLION)
i. Works
ii. Project management and coordination
iii. Physical contingencies
Financial contingencies
I. Works and services 249.81
II. Physical contingencies 17.49
III. Financial contingencies 9.99
TOTAL RESOURCES 277.29
ix
IMPLEMENTATION PLANNING
Years
Activities / Months J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
1 - PRELIMINARY ACTIVITIES
1.1 - Project Appraisal by Bank staff
1.2 - Board Approval
1.3 - Entry into force
2 - ROAD WORK LOT N°1
2.1 - Procurment process and notification
2.2 - Work implementation of Lot 1: South road
3 - ROAD WORK ( LOT N°2): Viaduct
2.1 -Procurment process and notification
2.2 - Work implementation of Lot 2
3 - ROAD WORK LOT N°3: North Road
3.1 - Procurment process and notification
3.2 - Work implementation of Lot 3
4 - TECHNICAL ASSISTANCE TO THE PIU
4.1 - Procurment process and notification
4.2 - Contract implementation
5 - SUPERVISION OF LOT N°1, LOT N°2
AND LOT N°3
5.1 - Procurment process and notification
5.2 - Consulting services implementation
6 - TECHNICAL CONTROL OF LOTS N°1,
LOT N°2 AND LOT N°3
6.1 - Procurment process and notification
6.2 - Consulting services implementation
7 - ANCILLARY WORKS
7.1 - Procurment process and notification
7.2 - Ancillary works implementation
8 - AUDIT
8.1 - Procurment process and notification
8.2 -Financial audit
9- PROJECT MANAGEMENT
20222017 2018 2019 2020 2021
1
REPORT AND RECOMMENDATIONS OF THE BANK GROUP MANAGEMENT TO
THE BOARD OF DIRECTORS ON THE PROPOSED AfDB LOAN FOR THE
FINANCING OF THE NORTH-EAST ROAD CONNECTIVITY SUPPORT PROJECT IN
TUNISIA.
Management hereby submits this report and the recommendations concerning the proposed grant
of an AfDB loan of EUR 122.000 million to the Republic of Tunisia for the financing of the North-
East Road Connectivity Support Project.
I - STRATEGIC THRUST AND RATIONALE
1.1 Key Development Issues
1.1.1 The Bizerte built-up area is experiencing high population growth that has not always been
well planned and regulated. The expansion of its sub-urban areas (Zarzouna and the cities of
Menzel Jemil and Menzel Abderrahmane), over the past decades, has increased its population to
about 180,000 inhabitants from 120,000 in 1990. The analysis of Bizerte highlights the problem of
congestion at the city centre and that of commuting between the two banks of the Bizerte canal
and, by extension, between the country’s Centre and North West regions. This situation is
exacerbated when the existing mobile bridge is opened to allow ships to access the commercial
port at the city centre. This existing mobile bridge is the only connection between the two banks of
the canal. Traffic across the canal is on the steady increase and will reach around 77,000
vehicles/day by 2030. Much of this flow, about 65%, is transit traffic on highway A4 from Tunis
via the city of Bizerte to the North-west of the country.
1.1.2 Constructing a new bridge outside the city and linking it with highway A4 will help divert
traffic headed for a destination other than the Bizerte city centre, thus easing the traffic transiting
through the existing mobile bridge, which will drop to 26,000 vehicles/day by 2030. The project
will also improve the connectivity between some sub-urban areas of the city of Bizerte (Menzel
Jemil and Menzel Abderrahmen on the south side) and Greater Tunis.
1.2 Project Linkages with Country Strategy and Objectivespays
1.2.1. After achieving a successful democratic transition, Tunisia is striving to implement
economic and institutional reforms that would allow a return to strong and inclusive economic
growth in the country. Thus, in 2015, on a participatory basis, the Government prepared the
Development Strategy Plan (DSP) for the period 2016-2020. This plan, which received the support
of investors when it was presented to them in November 2016, aims to bring about structural
transformation of the Tunisian economy towards sectors with higher value added. It is based on
two pillars, namely: (i) Shifting to an economic hub, focused on increasing productivity for
competitiveness and positioning Tunisian businesses in global value chains; and (ii) Tackling
regional disparities and achieving the ambitions of internal regions, by building economic
infrastructure and supporting entrepreneurship in lagging regions.
1.2.2. By the end of the DSP implementation period, these two pillars will be concretized, in
particular:
2
i) for the first, by developing infrastructure and logistics through (a) the reduction in
the cost of logistics from 20% of GDP in 2015 to 15% in 2020; and (b) through the
promotion of employment and employability, especially among graduates of higher
education and in regions of the hinterland; and
ii) for the second, by ensuring a 30% reduction in the existing gap between the regions,
reflected in the Regional Development Index (RDI) 1 .
1.2.3. Based on its benefits as outlined in paragraph 1.2.1 below, this North-East Road
Connectivity Support Project (PACR) is in line with these two pillars. It is a flagship project for
both the DSP and the investment plan of the Ministry of Equipment, Housing and Regional
Planning (MEHAT), which underpins the DSP implementation.
1.3 Rationale for Bank Intervention
1.3.1 The PACR is in line with the 2017-2021 CSP for Tunisia and it aligns with the two pillars
adopted, which, as already mentioned, are: (i) industrialization and the development of local
agricultural value chains; and (ii) improvement of the quality of life of populations in priority
regions. Indeed, the project's area of influence has, among others, strong agricultural potential, in
particular, for industrial crops, market gardening, arboriculture, cattle breeding and milk whose
evacuation for their processing is facing challenges due to the lack of good road infrastructure.
Similarly, the development of these crops and future industrial sites will provide sources of labor
income from Bizerte and Beja, selected as priorities with regional development indices of 0.49 and
0.39 respectively. Lastly, the underprivileged population of adjacent neighborhoods will benefit
from the related developments planned in the project.
1.3.2 In light of expected benefits, the PACR is in line with the Bank's ten-year strategy (2013-
2022), including with some of its operational pillars, namely, infrastructure development, transition
to green growth, and the integration of the centre and north-western regions of the country, and
Tunisia with the rest of the world, with the development of the port of Bizerte which will support
the new direction of the Tunisian economy oriented towards development with the rest of the
continent. Finally, it is in line with three of the Bank's five main priorities: (i) "Industrialize Africa"
by allowing the development of the three industrial zones where more than 60% of the units are
totally export-oriented, (ii) "Improve the quality of life for African people" by reducing congestion
costs, rehabilitating certain neighborhoods, and developing a recreational area, and finally "Feed
Africa") by enhancing the potential of the local agricultural land in the project area, and the
transformation of surplus production. It is also in line with the thematic strategy for youth
employment in Africa 2016-2025 by creating jobs from construction, but especially by establishing
future industrial units and services related to the Bizerte port development.
1.3.3 The PACR consolidates the Bank's position as a partner of choice in the road sector in
Tunisia. The Bank assists the Government through physical interventions in all three modes of
transport: road, air and rail, as well as through support in the area of policy and institutional
reform. However, this assistance is more pronounced in the road sector where the Bank, through
its five previous interventions in the form of loans, has helped to modernize more than 70% of
1 The Regional Development Index is a synthetic indicator of 17 variables referring to four areas, namely "wealth and employment",
"knowledge", "health and population" and "justice and equity".
3
Tunisia’s network of asphalted roads. Also, through the three grants already provided, the Bank is
helping the Government to develop (i) a long-term vision for the sector by implementing a transport
plan; (ii) roads sector management reforms; and (iii) new standards for road construction to
improve the resilience of road infrastructure to climate change impact.
1.4 Aid Coordination
1.4.1 There is no formal framework for coordinating the operations of technical and financial
partners (TFPs) in the transport sector, in general, and in the roads sub-sector, in particular.
However, through the on-going contacts of the North Africa Regional Development and Business
Delivery Office with the authorities in charge of the sector, the Bank is kept informed of the
operations of other donors. Also, the Bank is continuing dialogue with PTFs represented or on
mission in Tunis. The dialogue covers both reform assistance and the search for supplementary
financing and reduction of transaction costs. This project, financed jointly with the European
Investment Bank (EIB), is an example of such cooperation. The Bank is also funding the national
study of the transport plan, which will serve as a framework for dialogue and the reference for
future interventions by partners in Tunisia.
1.4.2 Pending the recommendations of the plan, the TFPs were involved in the development of
the road sub-sector programme (2016-2020), of which this project is an integral part. This
programme is estimated at TND 12 billion, including an expected donor contribution of TND 9.2
billion. So far, the funding that has been mobilized or is in the process of being mobilized, pending
the project approval, amounts to TND 3.12 billion, or 34% of the projected amount.
Table 1.1
Donor contribution to the financing of the road sub-sector programme (TND million)
Status Donor Amount (%)
AFESD 1,322 14%
Acquired/ in the course of
being acquired AfDB 417 5%
EIB 1,205 13%
WB 180 2%
Sub-total 3,124 34%
To be sought 6,107 66%
Total 9,231 100%
4
II- PROJECT DESCRIPTION
2.1 Project objectives and components
2.1.1 The project objective is two-fold: (i) improving the competitiveness of the Tunisian
economy by addressing the growing demand in terms of transporting goods and people across the
urban area of Bizerte, thus helping to ease congestion on access roads to the three industrial areas
and the port, and to equalize network loads; and (ii) fostering mobility and trade between the
Northern and Eastern regions of the country.
2.1.2 Indeed and in line with the Bizerte Urban Development Master Plan, its implementation
will help channel traffic away from the Bizerte city centre and will thus ease traffic congestion on
the existing mobile bridge. The project will therefore help to promote intra- and inter-regional trade
as well as reduce regional social disparities. Lastly, it will reduce accidents, CO2 emissions,
improve the quality of life of the populations and facilitate access to social and economic centres.
To achieve these objectives, the project operations have been grouped into three (3) components
summarized in the table below.
Table 2.1
Project components (EUR million) No. Name of component Description
1
ROAD WORKS
(263.77)
1.1. Development of a new South sub-urban two-way, two-lane (2x2)
expressway from PK 0+000 to PK 4+639, connecting road A4/RNr8 to the
Viaduct;
1.2. Construction of a 2,070 km viaduct from PK 4+639 to PK 6+749 ;
1.3. Development of a new North suburban two-way, two-lane connecting road
from PK 6+749 to PK 9+446 linking the Viaduct to RL 348;
1.4. Release of the right-of-way and displacement of networks;
1.5. Management as well as control and supervision of roadworks and the
structures.
2
ANCILLARY
DEVELOPMENTS
(5.66)
2.1. Construction on the South bank of a 2.4 km-long paved road linking the
city of South Zarzouna and the Technopole to North Zarzouna and Manzel
Abderahman;
2.2. Development of a 25,000 m² landscaped park under the viaduct;
2.3. Rehabilitation of cities crossed.
2.4. Management as well as the control and supervision of ancillary works.
3
PROJECT
MANAGEMENT
(7.86)
3.1. Technical assistance and project management;
3.2. Project technical audit;
3.3. Project accounting and financial audit;
3.4. Operation of the management entity;
3.5. Project-centred communication.
The description of project developments is provided in Appendix I.
5
2.2 Technical Solution Adopted and Alternatives Explored
2.2.1 From the technical standpoint, the project was designed to: (i) solve the congestion problem
in Bizerte city centre, generated mainly by transit traffic, and that of mobility on the canal crossing,
stemming from the fact that the two shores are connected by a single road; and (ii) help to lift the
constraints imposed by these problems on the socio-economic development of the Bizerte and Beja
regions.
2.2.2 In this context, technical and economic feasibility studies compared seven (7) crossing
corridors, each comprising a variant that crosses the canal by means of both a viaduct and a tunnel
and meet the following criteria: (i) a two-way, two-lane (2x2) urban expressway that can
accommodate heavy duty vehicles; and (ii) compliance with the clearance allowance with a view
to maintaining navigation on the canal. These variants were the subject of a multi-criteria analysis,
integrating socioeconomic, environmental and economic returns. From this analysis, a variant was
selected consisting of a viaduct crossing of approximately 2,070 m-long, having three spans of 270
metres each. It will have a composite meshwork deck and a 25 metre-wide double composite
structure, designed to accommodate a 2x2 expressway with sidewalks.
2.2.3 The alternative solutions explored and the reasons for rejection are indicated in the
following table:
Table 2.2: Alternative solutions explored and reasons for rejection
Alternative
solutions Brief description Reasons for rejection
Increasing the
capacity of the
existing bridge
Broadening the
bridge into a two-
way, two-lane
crossing
This alternative (i) involves complex structural
interventions; (ii) entails a risk for the structure in the
event of a vessel collision; and (iii) does not resolve the
problem of urban traffic congestion.
Viaduct Cable-stayed
bridge
This type of structure was not selected because of the
proximity of the aerodrome which imposes height
restrictions.
Viaduct Arc bowstring
bridge
Cost 18% higher than the adopted solution.
2.3 Project Type `
2.3.1 The project is a standalone investment operation, co-financed with the EIB and the AfDB.
For the Bank, the proposed financing instrument is an ADB loan.
2.4 Project Cost and Financing Arrangements
2.4.1 The estimated cost of the project is TND 761.72 million, or EUR 277.29 million (at the
exchange rate of EUR 1 = TND 2.747 in June 2017). This total cost was calculated by discounting
the cost of the technical study. Physical contingencies were estimated at an average of 7% of the
base cost. The provision for price escalation was estimated at an average of 4% and according to
6
the works implementation schedule. The summary of the total estimated project cost is given in the
table below. Table 2.3
Estimated Costs by Tax-free Component (AfDB Financing)
Composantes
Million TND Million EUR*
Currency ML Total Currency ML Total
A- Works
A1 LOT1: Development of the South Link Road 27,72 18,46 46,18 10,09 6,72 16,81
A2 LOT2: Viaduc construction 124,16 60,68 184,85 45,20 22,09 67,29
A3 LOT3: Development of the North Link Road 24,56 16,37 40,93 8,94 5,96 14,90
A4 : Related works.
A4.1: 2.4 km paved road 1,20 1,80 3,00 0,44 0,66 1,09
A4.2: Rehabilitation of a landscaped park 1,60 2,40 4,00 0,58 0,87 1,46
A4.3: Neighbourhood rehabilitation 1,10 1,90 3,00 0,40 0,69 1,09
S/Overall Works 180,34 101,61 281,96 65,65 36,99 102,64
B- Services
B2: Project management mission for the Lot 1
(including the related A4.1 works) 3,46 1,48 4,94 1,26 0,54 1,80
B4: Project Management Mission for Lot 3 3,17 1,36 4,53 1,16 0,50 1,65
B5: Technical Inspection Mission for Lot 1 (including
A4.1 related works) 0,42 0,18 0,60 0,15 0,07 0,22
B6: Technical Inspection Mission for Lot 2 (including
A4.2 related works) 6,15 2,64 8,79 2,24 0,96 3,20
B7: Technical inspection mission for Lot 3 0,40 0,17 0,58 0,15 0,06 0,21
B8: Project management and technical control mission
for A4.3 related works 0,52 0,52 0,19 0,19
S/Overall Service 13,61 6,36 19,97 4,96 2,31 7,27
Basic cost (works & services) 193,96 107,97 301,93 70,61 39,30 109,91
Physical contingencies (7 %) 13,58 7,56 21,13 4,94 2,75 7,69
Financial risks (4%) 7,76 4,32 12,08 2,82 1,57 4,40
Overall Total 215,29 119,85 335,14 78,37 43,63 122,00
Percentage 64% 36% 100% 64% 36% 100%
2.4.2 The project will be financed by the EIB, AfDB, and the Tunisian Government according to
the following table indicating the financing sources. On 15 November 2016, the EIB approved
financing for the project worth EUR 123 million. The Bank will provide supplementary financing
amounting to EUR 122.00 million, being a loan under the AfDB window. The Government will
supplement the financing plan to the tune of EUR 32.29 million.
Table 2.4: Source of financing, exclusive of taxes (EUR million)
Sources of financing L.C. F.E. Total (%)
AfDB 43,63 78,37 122 44,00%
EIB 29,81 93,19 123 44,36%
Government 32,29 32,29 11,64%
Total project cost 105,73 171,56 277,29 100%
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2.4.3 The EIB contribution will fully cover the out-of-tax costs of the PMU technical assistance,
and will contribute to the co-financing with the ADB for the construction of the viaduct and the
supervision mission of the viaduct. The government will finance the releasing of the right-of-way,
the relocation of the networks, the operation of the PMU, and will co-finance the rehabilitation of
the districts with the ADB. The Bank's contribution will fully fund the other works and services in
accordance with the table 2.3.
2.5 Project Area and Beneficiaries
2.5.1 The broad project impact area comprises the Bizerte and Beja Governorates. With an area
of 3 740 km², the Beja Governorate has 303,032 inhabitants, a population growth rate of 0.05%
and an urbanization rate of 44.3%. Its active population stands at 108 228 people. The Bizerte
Governorate, for its part, has a surface area of 3,750 km², a population of 568,219 inhabitants, a
population growth rate of 0.81% and an urbanization rate of 65.3%. The active population is 198
112 people.
2.5.2 The level of development of these two Governorates may be captured by the regional
development index (RDI), defined in Annex 5. On this index, the Beja and Bizerte Governorates
scored 0.39 and 0.49, respectively, on a scale of 1. These below-average scores reflect the
disparities in their disfavour. The knowledge index is more than 3 times higher in Tunis than in
Beja than and almost twice as high as in Bizerte. The scores are the same for the wealth and
employment index, and 2.42 times higher for health and population.
2.5.3 The project's direct impact area is the Bizerte built-up area. In recent decades, the city has
witnessed an unplanned and regulated urban development and expansion towards the outskirts,
notably with the development of the locality of Zarzouna, the cities of Menzel Jemil and Menzel
Abderrahmane, on the other side of the city canal, and Belvedere, Pêcherie and Kharrouba, on the
northern and north-western sides. This area has multiple and diversified potential, and is known
mainly for its strategic position in the middle of the Mediterranean, its important commercial port,
its agricultural, livestock and fishery activities, as well as its industrial traditions and its tertiary
sector. The economic activity of the region is mainly focused on agriculture, industry and fisheries.
In the region, there are 368 industrial enterprises - of which 248 are totally export-oriented –
employing over 50,000 people. These enterprises operate mainly in the textile, leather and
footwear, agri-food, mechanics and electronics sectors.
Project Beneficiaries
2.5.4 The project will improve the movement of people and goods in the Bizerte and Beja built-
up areas, as well as traffic towards Jendouba. Indeed, at the local level, the project will meet the
needs of road users crossing the urban area of Bizerte. The interchanges to be created will link the
communes and areas on the outskirts of the city of Bizerte, including Menzel Jemil and Menzel
Abderrahmane on the southern side.
2.5.5 Bizerte is the second port of Tunisia after Rades. Eventually, the project will help remove
the constraint imposed by the fact that the existing mobile bridge is opened three times a day to
allow ships to access the commercial port at the city centre. The removal of this constraint will
enable Bizerte to take the place of Rades as the leading port in Tunisia. Indeed, unlike the Rades
Port, Bizerte has 4 hectares of quayside land, making it possible to double the available area of
commercial docks. This development will not only reduce logistics costs for the region and its
export enterprises, but will also encourage the establishment of other export-oriented industries.
8
2.5.6 As part of the ancillary developments, the rehabilitation works in the neighbourhoods will
facilitate accessibility for the 9 000 residents, since the works will entail the construction of 14 km
of secondary roads, 8 km of rainwater drainage system and the improvement of lighting with the
installation of 300 lighting points. Lastly, in terms of socio-professional integration and
employment promotion, the project will enable 700 men/months to be recruited for works
implementation. It will also enable 100 young people enrolled in work-study programmes,
including at least 20 young women, to undertake internships designed to promote their
employability.
Participatory approach to project identification, design and implementation
2.5.7 The project was adopted as part of the implementation of the Development Strategy Plan
(PDS), which was drawn up in a context of broad consultation at both the regional and national
levels. The project study was conducted using a participatory approach. During the preparation of
environmental and social impact assessment and the technical and economic studies, the various
stakeholders were also consulted. The consultations were carried out at the national level, as well
as at the level of the Bizerte Governorate, delegations and residents of the project area: (i) from 6
April 2013 to 8 October 2013 and 3 June 2014 for the preliminary project design phase; (ii) on 3
April 2016, 14 November 2016, and 26 May 2017, specifically with respect to the project-affected
persons (PAPs) in the context of the Environmental and Social Impact Assessment (ESIA) and the
Comprehensive Resettlement Plan (CRP).
2.5.8 The inventory of the affected persons and expropriated property was based on an
individual resettlement survey of all households located on the right-of-way, conducted from
February to April 2016. Consultation and awareness meetings were held with the project-affected
populations on the sidelines of the survey.
2.5.9 During the Bank's preparation and evaluation missions, the key players and institutions
were met to collect their opinions and complaints in order to address them in the project
formulation, particularly with regard to ancillary developments, the ESMP and the CRP.
2.5.10 This participatory approach, which led to the ownership of the project by the beneficiaries,
will be maintained and strengthened during project implementation through a stakeholder
engagement plan (SEP) at the national level, Bizerte Governorate, delegations and the population
of the project area. This plan, which provides for the setting up of a Monitoring, Mediation and
Accompaniment Committee, will allow: (i) regular meetings with the population of the two
Governorates (Bizerte and Beja), in an effort to increase awareness and social mobilization of these
local populations, and public and private operators; (ii) dissemination of key information on a
dedicated website of the Ministry of Equipment and Habitat and in national and local media.
2.5.11 Finally, during the appraisal mission, the Bank organized a workshop with the EIB, DGPC
and MDICI to address all co-financing risks with the EIB and the Government, as well as to validate
the operational arrangements for monitoring the project.
2.6 Consideration of Bank Group Experience and Lessons Learned in the Project Design
2.6.1 The design of the PACR incorporated the Bank's experiences in Tunisia and on the
continent. In Tunisia, the recent evaluation of the Bank Group's strategies and intervention
programmes over the period 2004-2015, carried out by IDEV, highlighted the relevance of the
9
objectives of the transport projects insofar as they focused on concerns critical to the country.
Similarly, it noted that operations in the sector were fully in line with the Bank’s various strategic
orientations for Tunisia, especially those for the periods of 2003-2007 and 2008-2012, as well as
the 10-Year Strategy (2013-2022) and, since 2015, the High Fives.
2.6.2 However, the review highlighted two shortcomings in the sector: (i) lack of a mechanism
for infrastructure maintenance; and (ii) weak coordination among different TFPs. In addition, the
recent completion reports for road projects V and VI, dating from 2016, recommended the
establishment of a monitoring and evaluation system for measuring the impact of projects and the
development of a maintenance strategy. Lastly, the sector review of Bank operations for the 2004-
2014 ten-year period added the improvement of quality at entry to the recommendations below.
These shortcomings are compounded by the sluggish pace at which the grant-funded studies are
conducted.
2.6.3 The issue of sustainability is addressed through the Bank's dialogue with the country's
authorities and the Government has understood the importance of sustainability and has been
mobilizing significant budgetary resources since 2015. The recent Road Infrastructure
Modernization Project (PMIR), approved in 2015, envisaged a Government-financed road
maintenance component worth EUR 116 million. Also, the Bank is financing a study aimed at
proposing an action plan for the establishment of a road fund, which will thus help to secure
resources dedicated to maintenance. Regarding the lack of coordination and sector strategy, the
Bank is also financing a national transport plan that will serve as a reference for all future
interventions by all TFPs and sector dialogue. This project has been the subject of a detailed study
enabling significant improvement in its quality at entry.
2.6.4 Lastly, after 2011, projects in the sector experienced delays due to expropriation problems.
This constraint has been lifted by the recent law of July 2016, relating to expropriation for public
utility. Indeed, the Law introduces expediency in the treatment of expropriation procedures and the
ownership of land for public purposes, while preserving the rights of citizens to bring claims on
compensation benefits. For this project, the process is overseen by the Governorate of Bizerte, and
is at a stage of payments or compensation of those affected (see para. 3.1.16). Finally, with regard
to studies, the Tunis Regional Office has come up with an action plan to support implementing
agencies in order to speed up implementation.
2.7 Key Performance Indicators
2.7.1 The project’s performance will be measured using the performance indicators that are
explained in the results-based logical framework. There are eight (8) such indicators: the Global
Competitiveness Index (GCI), the Logistics Performance Index (LPI), time saving, , number of
fatal accidents, direct employment created per year during construction, number of trainees, the
regional development index (RDI), and the reduction of transport-related CO2 emissions. These
indicators are consistent with the outcomes defined by the 2017-2020 CSP which are themselves
in line with the framework of the DSP objectives.
2.7.2 In order to carry out these operations within the planned timeframes, in addition to these
outcome indicators, performance indicators have been established in relation to the Bank's
institutional performance indicators. These are mainly: (i) the loan effectiveness period; (ii) the
period of fulfilment of conditions precedent to the first disbursement of funds; (iii) contracting
10
timeframes; (iv) the average project status indicator (PI); and (v) changes in the disbursement rate
depending on the expenditure schedule. These indicators will be monitored during joint supervision
missions by the Bank, the EIB and the Government and in the day-to-day management of the
project.
III- PROJECT FEASIBILITY
3.1 Economic and Financial Performance
3.1.1 The economic analysis of the project was carried out using the cost-benefit method based
on the “with” and “without” project situations, over a 25-year period following the commissioning
of the structures. The costs include capital expenditures, annual and periodic maintenance, as well
as expropriations and the displacement of networks. The benefits of the project were assessed by
differentiating between generalized transport costs with and without the project, that is, the vehicle
operating costs and the travel time, reduced number of accidents, and reduced CO2 emissions.
3.1.2 Vehicle operating costs (VOCs) were calculated using the HDM 4 Road Use Costs model,
based on two representative categories of traffic vehicles, namely, light vehicles, and heavy duty
vehicles. The time, accident and CO2 emission values were estimated from existing national studies
or by reference to other countries.
3.1.3 The average annual daily traffic volume on the projected highway in the year of
commissioning is estimated at 27,000 vehicles, of which 7% are heavy duty vehicles. On the basis
of socioeconomic and demographic changes in the trade emission and attraction areas, traffic
growth rates were calculated. Thus, under conservative assumptions, traffic in the light vehicle
category will increase annually by 4.4% and 4%, respectively, during the 2021-2028 and 2029-
2040 periods. For the heavy duty vehicle category, these rates will be slightly lower, standing at
4.1% and 3.7%, respectively, for the same periods.
3.1.4 Economic performance of the project: The project’s performance was measured by the
internal rate of return (IRR) and the net present value (NPV). Based on the assumptions, the IRR
is 16.7% and the NPV, at the rate of 8%, amounts to TND 817 million. The robustness of these
results was tested by varying the two key parameters: investment costs and benefits. Thus, a 10%
increase in costs, coupled with a 10% decrease in benefits, slightly reduces the IRR to 14.7% and
the NPV to TND 656 million, thus confirming the project’s positive economic rate of return. The
details of the economic analysis can be found in the technical annexes to the report.
Table 3.1: Outcomes of the economic analysis
Scenario IRR (%) NPV (TND
million)
Baseline (1) 16.6 817
+10% costs (2) 15.8 779
-10% benefits (3) 15.5 693
Sensitivity test: (2)+(3) 14.7 656
11
3.2 Environmental Impacts, Climate Change and Social Impacts
Environment
3.2.1 Its size and the main environmental and social impacts identified, the project was
classified in Category 1, in accordance with the Bank's environmental and social assessment
procedures. An ESIA was carried out in 2015 and 2016 respectively for the permanent link and its
extension and finalized in 2017. A Comprehensive Resettlement Plan (CRP) was also prepared and
finalized in 2017. The ESIA reports were approved by the National Environmental Protection
Agency (NEPA) and the notices of compliance were issued on 31 December 2016 and 10 May
2017 respectively for the permanent link and its extension. Summarized versions of the ESIA and
CRP were posted on the Bank's website in July 2017. The project will generate significant
environmental benefits, including: (i) land recovery at the Zarzouna shoreline and the creation 25
000 m2 of urban green space under the bridge; (ii) improved air quality in the project area through
the reduction of air emissions (see Para 3.1.8); (iii) significant improvement in urban mobility while
preserving existing urban forests (Nadhour and Béchateur on the north side and Errimel forest on
the south side); (iv) the addition of another major tourist attraction to the 'Bizerte destination, and
considering its proximity to the Ichkeul park, will boost the development of ecotourism.
3.2.2 The main risks and negative impacts during the works are: (i) loss of vegetation - mainly
grass, shrubs and 250 trees at the level of the bypass, macrophytes and benthic macro-fauna in the
canal area. No status and protected area species will be affected; (ii) qualitative degradation of
water resources, temporary change in turbidity/sedimentology during the canal works; (iii) an
archaeological vestige in the Ramadia area, located 100 metres from the axis of the projected road
could be impacted.
3.2.3 The enhancement of the positive environmental impacts and the mitigation of the above-
mentioned negative impacts will be achieved by applying the following measures: (i) strict
adherence to the measures stipulated in the ESMP, including the sediment quality control plan,
waste management plan, spill emergency response plan, etc.; (ii) planting of 9,750 alignment trees
and development of green spaces; (iii) implementation of the protection plan for the Ramadia
archaeological site. The cost of implementing the ESMP measures, excluding expropriations, is
estimated at TND 3.4 million.
Climate Change
3.2.4 In terms of climate, the project was classified in Category 2, in accordance with the Bank's
Climate Safeguard System. The main risks concern: (i) the presence of flood-prone areas (around
wadi Abbes and wadi El Marj and in the Bizerte canal area), coupled with the absence of proper
drainage structures; (ii) the strength and frequency of prevailing winds (of the North-West sector).
Regarding the first risk, the project design includes appropriate measures, including: (i) flood-
proofing the road at the areas concerned; (ii) ensuring that the size of the hydraulic and drainage
structures constructed are such that they will not only protect the road infrastructure but also
improve environmental sanitation for residents of the areas concerned. The second risk will be
mitigated by the 3 metre-high transparent windbreak screens planned to be put up along his viaduct.
In terms of mitigation, the project implementation will reduce CO2 equivalent (CO2 eq) emissions
by an average of 61 000 tonnes per year, according to the average traffic growth scenario of the
assessment.
12
Gender and Vulnerability
3.2.5 The development strategy implemented in Tunisia considers women not only as a
fundamental vector for the preservation of social cohesion, but also as key players for social and
economic success. Women account for 50.2% of the population of the Bizerte built-up area, which
is the project's direct impact area. Despite a 28.5% female unemployment rate in the area, women
are favoured for jobs because of the presence of textile, footwear and leather industries, which hire
them far more than men.
3.2.6 The inhabitants of Atomouh, Ben Nigro, El Massida, HaferMahr, and BirMasyougha – all
localities crossed by the project - live in extremely precarious conditions due to the fact that the
poor sanitation network in these neighbourhoods exposes them to flooding and the absence of
public lighting puts their safety at risk. Given the prevailing situation and the needs expressed
locally, the project has an ancillary development component. With regard to the socio-professional
integration of women and young people, the project also intends to develop the initiatives outlined
in the chapter below.
Employment
3.2.7 The unemployment rate in the direct impact area is 13.1%, of which women account for
28.5% and higher education graduates for 20.8%. In view of this situation, the project plans to
promote direct employment during the construction and operation phase, particularly through the
green spaces that will be created, but above all indirect employment by encouraging the
establishment of new industrial units in the project area and the development of the Bizerte Port.
3.2.8 700 men/months of employment, of which at least 10% for women in terms of direct
employment will be created per year during the construction phase. To this end, the local
workforce, both skilled and unskilled, will need to be identified and mobilized by the Regional
Directorate of the Ministry of Vocational Training and Employment (MFPE) through the
employment offices of the localities concerned. Preference will be given to the recruitment of
young engineers in accordance with the relevant Tunisian regulations.
3.2.9 In order to promote the employability of young people undergoing vocational training, the
MFPE Regional Directorate will help the construction company and local training institutes to
organize internships on the project site for 100 young people registered in work-study programmes,
including at least 20 girls. An agreement defining the objectives and ideal implementation
conditions will be established between the company, training institutes and possibly the Regional
Directorate of MPFE.
3.2.10 The project also plans to promote youth entrepreneurship and socio-professional
integration in sustainable development activities. In this context, cooperation will be established
with the "Green Jobs Platform in Bizerte (EPI)" project, funded by the Islamic Development Bank,
to help 850 job-seekers, of whom 100 will be helped to start their own businesses and 750 will
benefit from job placements (giving preference to girls). Thus, in the context of the development
of the landscaped park and recreational areas envisaged under ancillary developments, the
companies being established as part of the PEV project will be given special preference to carry
out the works. Moreover, the executing agency will also ensure that, in the recruitment, priority is
given to the 750 young people mobilized.
13
Involuntary Resettlement
3.2.11 The project will involve 319 households, or 1,309 people, located in the project’s right-
of-way. Expropriations will involve residential houses (125 households), agricultural land with and
without crops (198 owners and farmers), and businesses (11 traders). In this regard, a
comprehensive resettlement plan (CRP) has been drawn up on the basis of the new Tunisian Law
No. 2016-53 of 11 July 2016 relating to expropriation in the public interest, which is much more
favourable than the previous one.
3.2.12 The relocation of project-affected persons (PAPs) and the actual start-up of works will not
take place until these persons have been compensated and the resettlement issue resolved. It is
worth noting at this juncture that the regional authorities of Bizerte have already made operational
arrangements in that regard. The PAPs will have to choose, especially regarding their houses,
whether to be compensated in kind or in cash. The total cost of implementing the CRP is TND 52
million, to be funded by the Tunisian Government.
IV- IMPLEMENTATION
4.1 Implementation Arrangement
4.1.1 Just as for previous sector-based projects, MEHAT is responsible for the implementation
of the project, through the agency of the DGPC which has already set up a project management
unit (PMU). It will be based in Bizerte, the project location. This PMU, which was already actively
involved in the project preparation, was instituted by a Decree. It is headed by a director and
comprises 11 engineers of various specialties and a financial expert. Ancillary activities in other
sectors not covered by MEHAT will be carried out through project contracting delegation
agreements.
4.1.2 The PMU will be supported by a technical assistance mission whose terms of reference
have been approved by the Bank and EIB and are attached in the technical annexes. The assistance
will consist of: (i) 4 permanent experts in procurement, monitoring and evaluation, environmental,
social, and legal supervision; and (ii) experts hired on a short-term basis when the need arises. In
addition to this assistance, the PMU will use consulting firms mandated to perform project
management and works control tasks.
4.2 Procurement Arrangements
4.2.1 The PACR is characterized by a large volume of works contracts (65.95%) and
consultancy services (10.39%) to be concluded at the national and/or international levels2. To
facilitate the implementation of the project, the following arrangements were agreed upon.
4.2.2 Applicable procurement policy and framework: All procurement of works and
consultancy services financed or co-financed3 with Bank resources (AfDB and AGTF) will be done
in accordance with the Procurement Policy for Operations Financed by the Bank Group ("AfDB
Procurement Policy"), October 2015 edition, and in accordance with the provisions set out in the
3 There is provision for EIB co-financing for the viaduct construction
14
Financing Agreement. Pursuant to this policy and following the various assessments carried out, it
was agreed that:
(a) All procurement of road rehabilitation works of the cities crossed will be carried out
in accordance with the Borrower's procurement system ("National System") and
using the Competitive Bidding Documents (CBDs) commonly utilized in Tunisia;
(b) Works procurement for the North-bound and South-bound connecting roads
(including the asphalting of roads as part of ancillary developments) and the choice
of consultants shall be done in accordance with the Bank's procurement system
("AfDB System"), using the Bank’s competitive bidding documents (CBDs); and
(c) The procurement of the viaduct construction works (contiguous landscaping
included), to be co-financed with the EIB, will be in accordance with the EIB's
Procurement System. In this respect, insofar as the Mutual Reliance Agreement
(MRA) negotiated between the Bank and the EIB to supervise the procurement of
projects jointly financed by these two institutions is not yet approved, a formal
waiver by the Bank's Board of Directors for the application of EIB's procurement
policies for the procurement of the viaduct works has been requested. To oversee
the implementation of the project, a specific agreement will be signed between the
Bank and the EIB for the implementation of the tender for the viaduct works to: (a)
endorse the choice made by the Bank for this project, to designate the EIB as co-
financier-lead; (b) set the conditions governing the delegation of the fiduciary
responsibilities of the Bank to the co-financier-lead in connection with the tender
for the viaduct. Since the EIB does not have a standard Tender Dossier, it was agreed
between the two partners that the Bank's Standard Solicitation Files be used after
adjustment to fit the context. The implementation details of the agreed procurements
between the Borrower, the Bank and the EIB have been provided in Table B.5.d and
the Procurement Plan (Section B.5.8) of Technical Annex B. 5.
4.2.3 Efficient organization of procurement: All procurements within the context of the project
implementation will be carried out by the PMU set up within MEHAT's DGPC. This unit has been
provided with qualified staffs who have in the past been involved in projects financed by the
national budget, the Bank and the EIB.
4.2.4 Assessment of procurement risks and capacities: In order to address the specificities of
the project, the Bank assessed: (i) the risks at the national, sector and project levels; and (ii) the
capacities of executing agencies. The results of these assessments led to the conclusion that the
overall level of procurement risk was substantial and to the identification of the mitigation
measures proposed in paragraph 5.9 of Annex B.5. The resources required for the implementation
of these measures are loans secured from the AfD and the EIB.
4.2.5 Advance procurement actions: Given the time constraints related to the Borrower’s
agenda and in an effort to address the concern raised in Presidential Directive DP02/2015 on
speeding up project implementation, a reasoned request for advance procurement actions relating
to the viaduct construction works was received by the Bank, which proceeded to authorize it on 4
April 2017.
15
4.2.6 Special arrangements: Use of the EIB procurement system: In the absence of a Mutual
Reliance Agreement formally approved by the Bank's Board of Directors, the use of EIB’s
procurement system for the implementation of the viaduct-related invitation for bids envisaged
under the project co-financed by the Bank, requires that a waiver be requested and obtained from
the Board contained in the note in Appendix IV of this report..
4.2.7 Other specific terms proposed: In an attempt to secure the resources required to fulfil its
fiduciary obligations under the National System, the Bank and the Borrower agreed on a series of
measures whose rationale, objectives and details are presented in paragraph B. 5.7.1 of Annex B5.
These measures include: (i) monitoring and management of complaints; (ii) provision by the
Borrower of the names of the owners of companies that win high-value contracts, and publication
of contract awards by the Bank using these names; (iii) maintenance of prices at a reasonable level
in relation to the estimates of the contracting authority; (iv) submission of quarterly reports on the
progress of the project, which should include the list of contracts signed and the companies that
won them, the complaints filed and how they were handled; and (v) the integrity of the electronic
bid submission platform.
4.3 Financial Management Arrangements
4.3.1 The DGPC will be responsible for the project implementation and the management of
project resources. An evaluation of the project's financial management system was carried out in
accordance with Bank guidelines and covered aspects related to budget management, accounting,
internal oversight, financial reporting and external audit. It took into account the assessment of
Tunisia’s fiduciary risk conducted by the Bank in 2016 within the context of the CSP and the
conclusions of the audit and financial supervision reports of previous road projects carried out by
the DGPC. The evaluation found that the initial fiduciary risk posed by the project for the Bank
was moderate due to the DGPC’s sound knowledge of the procedures of the Bank and other donors,
gained from having implemented various Bank projects. In addition, given the scope and technical
complexity of the project, the PMU will be supported by international consultants through technical
assistance in the areas of procurement, technical and financial monitoring and external supervision
and independent technical control of works. However, specific arrangements are required to ensure
reliable and up-to-date project accounting, timely submission of audit reports and satisfactory
follow-up to the auditor's recommendations. Thus, the Sub-Directorate of General Affairs (SDAG)
will be responsible for the financial management of the project with the support of the Project
Management Unit (PMU). The latter will prepare disbursement requests, quarterly financial reports
and annual project financial statements. In that regard, the DGPC will furnish, prior to the first loan
disbursement, evidence of the appointment of a financial officer at the SDAG with qualifications,
experience in the financial management of projects and terms of reference deemed satisfactory by
the Bank.
4.3.2 Project resources will be partly managed using the national public finance management
system. Thus, expenditure financed with loan resources and counterpart contributions will go
through the public spending circuit and will be subject to national procedures and control
concerning: (i) expenditure commitment using the ADEB system, subject to approval by the
expenditure controller; (ii) settlement of expenditure by the technical and financial services after
acknowledgement of the service performed (acceptance of works or services by the external
supervisors and technical works controllers); (iii) authorization of expenditure payment by the duly
empowered authorizing officer (the Director-General of DGPC for payments from AfDB and EIB
16
resources, and the MEHAT Finance Director for payments from the national budget); and (iv)
payment of expenditure by the public accountant attached to the Ministry of Finance (MF) for
expenditures financed from the national budget.
4.3.3 The DGPC uses a budgetary accounting system and does not keep the accounts of the
projects it manages. Thus, project financial information will be compiled using a computer
application duly configured to monitor resources by source of financing, and expenditure by
component and by category. Quarterly financial reports will be prepared using the format provided
by the Bank. Annual project financial statements will be prepared in accordance with the Bank’s
ToR. The project’s financial management will be supervised once a year and quarterly financial
and audit reports will be reviewed.
Disbursement arrangements
4.3.4 The disbursements of the Bank’s loans will be subject to the Bank's disbursement rules in
force as set out in the Bank’s Disbursements Handbook. The project will use the direct payment
method for the settlement of eligible expenditure from the loans, given the limited number of
contracts envisaged and the relatively high amounts of individual disbursements. The financing
plan detailing the funding percentages of each donor per contract will be recorded in the tripartite
agreement (AfDB-EIB) specific to the project’s implementation.
Audit arrangements
4.3.5 The General Finance Control (CGF) will audit the project's financial statements covering
all the sources of financing (AfDB, AGTF, EIB and counterpart contributions) on a year-on-year
basis, in accordance with the terms of reference for auditing investment operations financed by the
Bank Group. The project audit reports, including internal audit reports, should be submitted to the
Bank and the EIB within six months of the end of the fiscal year concerned. The PMU will ensure
proper planning of the audit mission and the monitoring of the implementation of the auditor's
recommendations. Furthermore, the project may be subject to verification by State control
institutions. The Bank will obtain and utilize such control mission reports.
4.4 Monitoring
4.4.1 The PMU will include a multidisciplinary team which will be responsible for monitoring
the implementation of all project components. This team will produce semi-annual reports to be
forwarded, through the DGPC, to the AfDB and the EIB. These reports will provide an update on
the level of physical and financial implementation of each project component. Specific reports will
be prepared on the ESMP and CRP implementation. Lastly, separate reports will also be prepared
on the monitoring and evaluation of project impacts based on the identified indicators, depending
on the status of implementation. The Bank, through the Tunis Regional Office, will monitor, on an
on-going basis, the implementation of the project, which will be supplemented by two annual field
supervision missions, conducted jointly with the EIB.
4.5 Governance
4.5.1 In terms of governance, with a score of 66.9 out of 100, Tunisia ranks 8th out of 52
countries in the Mo Ibrahim Index of African Governance (IIAG). This score is up 2.6 spots from
2010, attesting to the country’s unquestionable progress in that area. In the 2016 Transparency
17
International ranking, Tunisia scored 41 points versus 38 and 40 in 2015 and 2014, respectively.
This score of 41 points places Tunisia 75th out of 176 countries. The improvement, although still
fragile, is the result of the major anti-corruption measures taken in 2015, such as the passing of the
Information Access Act - one of the most progressive laws in the region - and the adoption of a
national anti-corruption strategy.
4.5.2 In the road sector, good governance practices are intended to result in projects that are: (i)
more efficient, (ii) more relevant, (iii) more sustainable, and (iv) more beneficial to vulnerable
groups. Undeniable progress has been made in this direction. Thus, the sector’s development plan
for 2016-2020 has been widely participatory and was appropriated by various civil society
categories at all territorial levels. Project distribution and allocation were made with a view to
fairness towards the most deprived regions and included accompanying measures for women and
vulnerable groups. Transparency and accountability are also progressing at both the State and
legislative levels. The same applies to the national procurement system and procedures which have
moved closer to international standards.
4.6 Sustainability
4.6.1 Over the past two decades, the Government has been working to upgrade the existing road
network with Bank support and now intends to focus its policy on the preservation of the network
rather than on its extension. Since 2015, despite the scarcity of budgetary resources and the needs
of other sectors, the government has allocated a substantial amount for the maintenance of the road
network, estimated at 629 million TND, and the planned allocation for 2018 is estimated at 219
million TND in a net increase compared to previous years. Besides increasing allocations, the
Government is seeking to improve the resource use efficiency by (i) gradually privatizing road
maintenance through transfer of the activity to SMEs which will be supported in terms of
professionalization; and (ii) initiating pilot experiments in road maintenance management by
service levels, which will be generalized if they prove to be positive.
4.6.2 These measures for ensuring the sustainability of investments will be supplemented by the
recommendations of the on-going study to upgrade the road sub-sector, financed by the Bank under
the Road Infrastructure Modernization Project (PMIR). This study will review, among other things,
the issue of road financing and maintenance, and the possibility of establishing new structures for
commercializing road management and ensuring the sustainability of road maintenance financing.
4.6.3 Regarding this project, the funding needed for the maintenance of the planned facilities
and the viaduct, in particular, was estimated at TND 2.10 million per year. This will be covered by
the resources fromthe State Budget. Lastly, revenues from the rental of the planned recreational
infrastructure will be used to ensure the sustainability of the landscaped park.
4.7 Risks Management
4.7.1 The project implementation poses minor risks in view of: (i) the detailed studies involved
in its preparation; (ii) the capacity and experience of the DGPC which will be supported with
technical assistance; and (iii) the high competition expected in the procurement process. Thus, the
risks of cost overruns and delays will be minimal. The rights-of-way release problems hindering
the successful implementation of projects in Tunisia were addressed by the law of July 2016
relating to expropriation in the public interest and the advanced stage of the process for the project
which is at the level of paying or compensating affected persons (see paragraphs 2.1.24 & 3.1.6).
18
In this respect, the first installments will be budgeted in the 2018 financial year, and work on a
given area is subject to proof of compensation of affected persons in that area. The two potential
risks relate to the co-financing of the project:
Implementation delays: the use of EIB procurement rules, the lead financier for the
viaduct construction, poses the risk of delays in the mobilization of enterprises and
of lack of proactivity in the processing of requests from the executing agency. This
risk is mitigated by the decisions of the joint meeting which agreed to: (i) a protocol
agreement between the AfDB and the EIB defining the roles and responsibilities of
each donor; and (ii) regular consultations during supervision or on an ad hoc basis;
Cost overruns due to physical contingencies or performance delays. This risk is mitigated by the
detailed studies which were carried out by experienced consultants. In addition, cost estimates
provided for physical and financial contingencies to cover possible cost overruns.
4.8 Knowledge Building
4.8.1 The project is the first of its kind and the most complex in Tunisia both in terms of its
engineering and work site organization. Indeed, the nature of its foundations (piles 60 m deep and
2.5 m in diameter) and the great length of its spans (270 m) make it the first project of this scale in
Tunisia. Its implementation will result in knowledge building in various fields. The measures taken
within the context of the project, both in terms of the composition of the Project Management Unit
(PMU) and end-of-course engineering projects and vocational training for young people will
contribute to knowledge. The line ministry also plans to ensure the large-scale dissemination of
best practices for major infrastructure construction projects learned during the implementation of
this project. The dissemination will be carried out through a website dedicated for that purpose,
briefing notes and conferences with professional and training organizations.
4.8.2 The effects of the project, which will be quantified under the monitoring and evaluation
sub-component, will allow an assessment of the level of achievement of project objectives and will
be integrated into the broader framework of all previous Bank interventions in order to measure
the impact on the development of the Bank's operations, particularly in its five priority areas of
action.
V- LEGAL FRAMEWORK
5.1 Legal instrument
The Bank will finance the project through the following instruments:
i) An agreement for a loan from ADB resources concluded between the Tunisian State
and the Bank in the amount of EUR 122.000 million;
5.2 Conditions associated with the Bank's intervention
A) Conditions precedent to the effectiveness of the ADB loan agreement
5.2.1 The effectiveness of the Loan Agreement shall be subject to compliance by the Borrower
with the provisions of Section 12.01 of the General Conditions Applicable to Loan Agreements
and Guarantee Agreements of the African Development Bank.
19
B) Conditions precedent to the first disbursement of ADB loan
5.2.2 The Bank's obligation to make the first disbursement of the ADB loan shall be subject to
the effectiveness of the Loan Agreement in accordance with Section 5.2.1 above , and the
fulfillment, to the satisfaction by the Borrower, of the following condition, to the Bank's
satisfaction.
5.2.3 The provision of evidence of the appointment of a financial officer within SDAG with the
qualifications, experience in project financial management and the terms of reference that are
satisfactory to the Bank.
C) Special condition prior to disbursement of loan resources for works involving
expropriation
In addition to the entry into force of this Agreement and the fulfillment of the condition precedent
to first disbursement of Loan resources, the disbursement of Loan resources for works involving
expropriation shall be subject to the performance by the Borrower, to the satisfaction of the Bank,
subject to the following condition:
5.2.4 Provide, as the works progress and prior to the start of works in any area concerned,
evidence of compensation of the project-affected persons in that area and/or of procurement of the
land required for the construction, in accordance with the Environmental and Social Management
Plan (ESMP), the Complete Resettlement Plan (CRP) and the Bank's relevant rules and procedures,
including the Policy on Involuntary Displacement and its integrated safeguard system.
5.2.5. It is specified that where such compensation or resettlement is not feasible because of the
impossibility of identifying the beneficiaries or in case of dispute, litigation or other duly justified
reasoning acceptable to the Bank (hereinafter referred to as the "Contentious Case"), the condition
may be considered fulfilled if the Borrower provides evidence that the resources allocated to the
compensation and / or relocation of the Contentious Cases, as defined in the PCR, are deposited in
an account dedicated to the Public Treasury assigned to this compensation and / or resettlement, or
to a bank account acceptable to the Bank specifically earmarked for this indemnification and / or
resettlement, or deposited with a trusted third party acceptable to the Bank.
D) Undertakings
5.2.6 The Borrower undertakes, to the satisfaction of the Bank, to:
Implement the project, the CRP and the ESMP and ensure their implementation by
its contractors, in accordance with (a) Bank rules and procedures; (b) national
legislation; and (c) recommendations, requirements and procedures contained in the
ESMP, and CRP;
Not to start work on an affected area without having fully compensated the affected
persons in that area; and
Provide the Bank with semi-annual reports on the implementation of the ESMP and
the CRP, including any shortcomings and corrective actions undertaken or to be
undertaken.
20
5.3 Compliance with Bank policies
The project complies with all applicable Bank policies.
VI- RECOMMENDATION
Management recommends that the Board of Directors approve, subject to the conditions set out in
this report: (i) in the case of the procurement of the viaduct works and the technical inspection
mission of Lot 2, exceptionally waive the application of the Bank's procurement rules and authorize
the application of the EIB's procurement policies; and (ii) approve, subject to the conditions
stipulated in this report, grant the Tunisian government an AfDB loan of EUR 122.00 million to
help finance the implementation of the North-East Road Connectivity Support Project.
I
APPENDIX I
DESCRIPTION OF PLANNED WORKS
I. Development of the two new South and North suburban connection roads: The
development works will cover a linear of 7,270 km, corresponding to the geometric
characteristics of a 2x2 lane expressway at a speed of 80 km / h. The route will
include four interchange points, three of which are completely leveled by
interchanges, and the connection at the end of the project through a roundabout.
II. Construction of the viaduct: The proposed viaduct will be a crossing structure of
2,070 km in length that will cross the canal with three spans of 270 m range. It will
have a 25 m deck to accommodate a 2x2 expressway pavement with sidewalks for
maintenance and safety passage. The viaduct was designed to cope with the strictest
seismic and safety standards, with occasional connections every 400 m to allow
traffic diversion from one roadway to another in case of emergency and a system of
video surveillance to control the emergency stop band. Likewise for safety reasons
and because of its fast track nature, its use by pedestrians and cyclists is not
envisaged.
III. Related Works: related works will be carried out in neighborhoods crossed by the
connecting roads and hosting interchanges, including crossing areas whose
populations live in unsettling precariousness. These include: (i) the construction on
the south banks of a 2.4 km paved road linking the Zarzouna South city and the
Zarzouna Nord Technopole and Menzel Abderrahmane; (ii) the development of a
25,000 m² landscaped park under the bridge in the Zarzouna banks area, on the left
banks of the lake, giving rise to a recreational green space; (iii) the construction of
14 km secondary roads, the construction of 8 km of rainwater drainage network and
public lighting with the installation of 300 light points in neighborhoods crossed.
IV. Project management. It will be supported by technical assistance which will also
provide monitoring and evaluation services for the socio-economic and
environmental impacts of the project; the road safety audit and the technical and
financial audits of the project and project implementation communication.
II
APPENDIX II
COUNTRY FINANCING PARAMETERS Introduction
1. This Note presents the country financing parameters for Tunisia in accordance with the
Bank’s policy on expenditure eligible for financing46. This policy enables the Bank to finance the
necessary expenditure to be able to achieve the development objectives of the operations financed
by the institution’s resources. The Note is designed as a framework for assessing the risks
concerning the viability of public finances with a view to ensuring that the Bank’s resources are
used appropriately and in accordance with the terms of its mandate. Moreover, the new policy
offers greater flexibility in the use of loans and grants to finance expenditure.
2. Macroeconomic context and public finance situation. Tunisia has suffered from a lack
of growth since 2011. The growth rate fell from 3.6% in 2010 to 0.8% in 2015 but could reach
1.6% in 2016. The fall in growth has been mainly due to uncertainties concerning security, the
different strike actions which have affected the production rate in the mining and hydrocarbons
(phosphates and gas) sector but also weak public investment. Since 2011, the composition of public
expenditure is mostly focused on current expenditure. The civil service wage bill has more than
doubled since 2010 as a result of recruitments and consecutive salary increases. In 2015, it
accounted for 46% of the budget and 13% of GDP. This deterioration is also linked to the
continuing subsidies on some staple products and energy, which represent about 16% of the annual
budget. In all, current expenditure accounts for between 60 and 65% of the overall budget and
between 75% and 80% of the budget net of debt servicing. The five draft budget laws have all been
passed with deficits since 2011 and the cumulative financing gap stood at 42 billion dinars in 2016.
For its part, the public debt increased significantly from 40.7% to 62% in 2016, i.e. an average
annual growth rate of 7.4% much higher than the 1.76% economy growth rate. Moreover, 70% of
outstanding debt is composed of external debt and Tunisia is exposed to an exchange rate risk since
the Tunisian Dinar has lost 32% of its value since 2010.
3. Portfolio. The Bank Group’s active portfolio currently comprises 43 operations,
representing total commitments of UA 1.25 billion. There are 13 public sector operations
representing 85a % of commitments. Tunisia’s portfolio also includes twenty-five (25) technical
assistance operations for a cumulative amount of UA 20.8 million. The lending portfolio’s
performance is deemed satisfactory overall despite slippage on the implementation of the technical
assistance portfolio due to the complexity of the functioning of the public procurement system.
4. Cost sharing. Due to the specific macro-fiscal context described above, increased
vulnerability of the economy and public finances and pressure on the budget which is expected to
continue during implementation of the PSD up to 2929 concerning current expenditure, the
Tunisian government’s fiscal leeway and ability to increase its counterpart funding of Bank-
financed operations is expected to remain limited. Consequently, in a prudential and pragmatic
approach, the Bank proposes to apply two (2) rates for financing its projects and programmes: the
Bank will finance 50% of the cost of projects with an immediate return in the productive sector
III
(water, agriculture, industry and services) and 60% of projects with a high social content
(education, health, employment, women, etc.) with a limited and /or gradual rate of return. The
balance will be covered by the Government and/or other donors. The Tunisian Government will
undertake to finance at least 10 % of all project costs.
5. Financing of recurrent costs. The Bank will not finance recurrent expenditure of projects
financed by it. Such expenditure should normally be covered by the Government. However, the
Bank may consider the possibility of financing them on a case-by-case basis.
6. Financing costs in local currency. The Bank’s practice is to finance the foreign exchange
costs of projects financed by it and consequently, most disbursements are made in foreign
exchange. In view of the deep public finance deficit and the existence of large construction
companies and the use of savings on loans, the financing of local currency costs should not be
limited and actual amounts should be fixed on a project-by-project basis.
7. Taxes and duties. Projects financed by the Bank are not generally subject to specific taxes.
The Bank consider on a case-by-case basis the possibility of financing taxes and duties for its
projects. The financing parameters for Tunisia are described below.
Table 3.2 : Country Financing Parameters
Item Parameter Explanation/Comments
Cost sharing. Maximum
proportion of project costs
that the
Bank can finance.
Productive sector with a high
economic rate of return
(structures, public services,
industries, agriculture,
mines, etc.): 50%
Social sector with a limited
and gradual rate of return
(education, health,
employment, women and
youth, etc.): 60%
The effective share of Bank
financing will be limited to
60% of all costs for projects
of a social nature and to 50%
of all costs for projects in the
productive sector (in
particular, infrastructure).
The balance will be covered
by co-financing. The
Government shall undertake
to finance a minimum of 10%
of the total project cost
excluding wages and salaries
Financing of recurrent costs.
Limits if necessary
concerning the total amount
of recurrent expenditure the
Bank may finance
Flexible The Bank can finance some
recurrent costs on a case-by-
case basis
Financing of costs in local
currency. The Bank’s
financing conditions for
expenditure in local currency
are met, in particular: (i) the
financing requirements of the
country’s development
YES The financing conditions for
local currency costs are met.
The Bank may finance local
currency costs in order to
achieve the objectives of
individual projects
IV
programme exceed the own
resources of the public sector
(for example, tax and other
revenue) planned borrowings
on the domestic market; and
(ii) the financing of
expenditure in foreign
exchange alone would enable
the Bank to contribute to the
financing of individual
projects
Taxes and duties. Are there
taxes and duties that the Bank
would not finance?
YES There are no unreasonable
taxes and duties.
There is, however, a slight
probability that the Tunisian
Government may borrow to
pay taxes and duties. The
Bank will not finance the
payment of taxes and duties
by borrowings
V
APPENDIX III
PROJECT COST AND FINANCING DEVICES
Table 2.5: Summary of the estimated cost per component of the overall project Components
Million TND Million EUR*
Total Currency Total Currency ML Total
A- Works
A1 LOT1: Development of the South Link Road 27,72 18,46 46,18 10,09 6,72 16,81
A2 LOT2: Viaduc Construction 350,19 87,55 437,74 127,48 31,87 159,35
A3 LOT3: Development of the North Link Road 24,56 16,37 40,93 8,94 5,96 14,90
A4 : Related works.
A4.1 : 2.4 km paved road
1,20 1,80 3,00 0,44 0,66 1,09
A4.2 : Rehabilitation of a landscaped park
1,60 2,40 4,00 0,58 0,87 1,46
A4.3 : Rehabilitation of neighborhoods 2,20 3,80 6,00 0,80 1,38 2,18
B- Services
B1: Support Mission to the PMU
11,15 4,78 15,93 4,06 1,74 5,80
B2: Project Management Mission for Lot 1 (including
A4.1related works)
3,46 1,48 4,94 1,26 0,54 1,80
B3: Project Management Mission for Lot 2 (including A4.2
layout)
29,04 12,44 41,48 10,57 4,53 15,10
B4: Project Management Mission for Lot 3 3,17 1,36 4,53 1,16 0,50 1,65
B5: Technical Inspection Mission for Lot 1 (including A4.1
related works)
0,42 0,18 0,60 0,15 0,07 0,22
B6: Technical Inspection Mission for Lot 2 (including A4.2
related works)
6,15 2,64 8,79 2,24 0,96 3,20
B7: Technical inspection mission for Lot 3 0,40 0,17 0,58 0,15 0,06 0,21
B8: Project management and technical inspection mission for
A4.3 related works
0,52 0,52 0,19
C: Release of Right-of-way 59,00 59,00 21,48 21,48
D: Network displacement 8,00 8,00 2,91 2,91
E: PMU operation 4,00 4,00 1,46 1,46
Basic costs
461,27 224,96 686,23 167,92 81,89 249,81
Physical contingencies (7 %) 32,29 15,75 48,04 11,75 5,73 17,49
Financial Risks (4%) 18,45 9,00 27,45 6,72 3,28 9,99
Overall Total
512,01 249,71 761,72 186,39 90,90 277,29
Percentage 67% 33% 100% 67% 33% 100%
VI
The project will be financed by the EIB, the AfDB and the Tunisian Government according to the
table below giving the financing sources. As at 15 November 2016, the EIB has approved EUR
123 million for the project. The Bank will provide additional financing of EUR 122.00 million
through a loan from its ADB window. The Government will complete the financing plan with EUR
32.29 million. The tables below provide a summary of the cost by category of expenditure and the
expenditure schedule by source of funding respectively:
The tables below provide a summary of the cost by expenditure category and
expenditure schedule by financing source respectively:
Table 2.6: Cost Summary by Spending Categories for AfDB financing
Components
Million TND Million EUR
Currency ML Total Devise ML Total
Works 180,34 101,61 281,96 65,65 36,99 102,64
Services 13,61 6,36 19,97 4,96 2,31 7,27
Various 0,84 0,84 0,31 0,31
Basic cost 194,80 107,97 302,77 70,91 39,30 110,22
Physical contingencies an
financial risk 20,49 11,88 32,37 7,46 4,32 11,78
Total Général 215,29 119,85 335,14 78,37 43,63 122,00
Table 2.7: Schedule of expenditure by financing source (Million EUR) for the entire project
SOURCE 2018 2019 2020 2021 2022
ADD 14,12 32,34 40,34 27,13 8,07
EIB 5,88 35,29 40,29 35,66 5,88
Tunisian Government 8,69 8,69 8,69 4,12 2,1
Overall Total 28,69 76,32 89,32 66,91 16,05
VII
APPENDIX IV
RATIONALE FOR AND EXTENT OF THE WAIVER SOUGHT
FROM THE BOARD FOR THE USE OF THE EIB PROCUREMENT
SYSTEM
Context and Rationale:
To facilitate the implementation of projects co-financed with other partners and in accordance with the
requirements of the Bank's New Procurement Policy, the relevant Bank services have initiated discussions
with several financial partners with whom the institution co-finances projects. A Mutual Reliance
Agreement governing the implementation of procurement aspects of projects to be co-financed with the
EIB was discussed and negotiated with the EIB. This document is awaiting approval by the Boards of the
two institutions. Pending such approvals, and in the absence of a Mutual Reliance Agreement formally
approved by the Board of Directors of the Bank, the use of the EIB's procurement system for invitation for
bids relating to the viaduct planned under the project and co-financed by the Bank requires the adoption of
the following special measure based on the rationale detailed below:
Request for a waiver allowing the use of EIB's procurement system: In accordance
with the provisions of Article 8.1 of the Bank's new Procurement Policy, Bank-
financed goods and services may be procured using the borrower's procurement
system (if certain conditions are met) or following the Bank's procurement policy.
This requirement is also applicable in a co-financing situation unless the Bank's
Board of Directors ("the Board") grants a waiver allowing the implementation of
the procurement policy, regulations, and guidelines of another co-financier (see Art.
10.3 of the Bank's Procurement Policy). Accordingly, in order to enable the EIB's
procurement policy to be applied to invitation for bids for the viaduct construction
works, a formal waiver will be sought from the Bank's Board of Directors for:
(i) the implementation of EIB procurement policies;
(ii) the application of the EIB's eligibility rules which are broader than those of
the Bank's AfDB window;
(iii) the extension of the list of sanctionable practices of the Bank to include
"money laundering" and "terrorist financing" as defined by the European
Community Directives and the anti-fraud policy of the EIB.
If this waiver is formally obtained, the EIB's procurement policy, as well as its eligibility and
integrity rules, could legally apply to the invitation for bids in question even if it is co-financed
with Bank resources. The advance procurement action authorized by the Bank refers to the need to
obtain the waiver.
VIII
APPENDIX V
REGIONAL DEVELOPMENT INDICATOR
Regional Development Index
I Introduction
In 2012, the Tunisian Ministry of Regional Development and Planning developed a comparative
study of the country's regional development. Due to the unavailability of data required to build a
regional GDP, the Department developed one that incorporates 17 variables, grouped into four
areas: (i) knowledge, wealth and employment; (ii) health and population; (iii) wealth and
employment; and (iv) justice and equity.
In order to ensure proper monitoring/evaluation, this index, the first version of which is in progress,
will be updated periodically.
II Definition of variables
Dimension Sub-dimension Weight Variables
Education 1 i. Success at the “A” Level (Baccalaureat) (in 2010)
ii. Enrolment rate among 6 to 14-year-olds (in 2010)
Knowledge
Index iii. Literacy rate (in 2010)
Communication 1 iv. Percentage of households with internet access (in 2007)
v. Telephone density (Landlines and GSM) by Governorate (in 2004)
Population 1 vi. Total fertility rate (TFR) (in 2009)
Population and
Health Index Health 1 vii. Number of physicians per 1,000 inhabitants (in 2008)
viii. Number of hospital beds per 10,000 inhabitants (in 2008)
Employment 1 ix. Unemployment rates by Governorate (in 2008)
x. PME density (Number of PMEs per 1,000 inhab.) (in 2009)
Wealth and
Employment
Index Wealth 1 xi. Poverty rates (in 2005)
xii. Drinking water access rates (in 2010)
xiii. Rate of household connection to the water supply system (in 2010)
xiv. Number of cars per 1 000 inhabitants (in 2010)
Justice 1 xv. Crime rate 1, 000 inhabitants (in 2009)
Justice et
Equity Index
Gender
Equality 1 xvi. Disparity between male and female enrolment rates (in 2005)
xvii. Disparity between male and female employment rates (in 2010)
IX
APPENDICE VI: TUNISIA - COMPARATIVE SOCIO-ECONOMIC
INDICATORS
Year Tunisia Africa
Develo-
ping
Countries
Develo-
ped
Countries
Basic Indicators
Area ( '000 Km²) 2016 164 30 067 97 418 36 907Total Population (millions) 2016 11,4 1 214,4 6 159,6 1 187,1Urban Population (% of Total) 2016 66,9 40,1 48,7 81,1Population Density (per Km²) 2016 73,2 41,3 65,1 33,8GNI per Capita (US $) 2015 3970 2 153 4 509 41 932Labor Force Participation *- Total (%) 2016 47,7 65,7 63,5 60,0Labor Force Participation **- Female (%) 2016 25,1 55,7 48,9 52,1Sex Ratio (per 100 female) 2016 97,6 100,1 106,0 105,0Human Dev elop. Index (Rank among 187 countries) 2015 97 ... ... ...Popul. Liv ing Below $ 1.90 a Day (% of Population) 2010 2,0 ... 18,3 ...
Demographic Indicators
Population Grow th Rate - Total (%) 2016 1,1 2,5 1,3 0,6Population Grow th Rate - Urban (%) 2016 1,3 3,6 2,4 0,8Population < 15 y ears (%) 2016 23,5 40,9 27,9 16,8Population 15-24 y ears (%) 2016 15,1 19,3 16,9 12,1Population >= 65 y ears (%) 2016 7,8 3,5 6,6 17,2Dependency Ratio (%) 2016 45,5 79,9 54,3 52,0Female Population 15-49 y ears (% of total population) 2016 27,0 24,0 25,7 22,8Life Ex pectancy at Birth - Total (y ears) 2016 75,2 61,5 69,9 80,8Life Ex pectancy at Birth - Female (y ears) 2016 77,6 63,0 72,0 83,5Crude Birth Rate (per 1,000) 2016 17,6 34,4 20,7 10,9Crude Death Rate (per 1,000) 2016 6,6 9,1 7,6 8,6Infant Mortality Rate (per 1,000) 2015 12,1 52,2 34,6 4,6Child Mortality Rate (per 1,000) 2015 14,0 75,5 46,4 5,5Total Fertility Rate (per w oman) 2016 2,1 4,5 2,6 1,7Maternal Mortality Rate (per 100,000) 2015 62,0 476,0 237,0 10,0Women Using Contraception (%) 2016 66,4 31,0 62,2 ...
Health & Nutrition Indicators
Phy sicians (per 100,000 people) 2005-2015 164,8 41,6 125,7 292,2Nurses and midw iv es (per 100,000 people) 2005-2015 318,9 120,9 220,0 859,4Births attended by Trained Health Personnel (%) 2010-2015 98,6 53,2 69,1 ...Access to Safe Water (% of Population) 2015 97,7 71,6 89,4 99,5Access to Sanitation (% of Population) 2015 91,6 39,4 61,5 99,4Percent. of Adults (aged 15-49) Liv ing w ith HIV/AIDS 2015 0,1 3,4 ... ...Incidence of Tuberculosis (per 100,000) 2015 37,0 240,6 166,0 12,0Child Immunization Against Tuberculosis (%) 2015 97,0 81,8 ... ...Child Immunization Against Measles (%) 2015 98,0 75,7 83,9 93,9Underw eight Children (% of children under 5 y ears) 2010-2015 2,3 18,1 15,3 0,9Prev alence of stunding 2010-2014 10,1 33,3 25,0 2,5Prev alence of undernourishment (% of pop.) 2015-2016 5,0 16,2 12,7 ...Public Ex penditure on Health (as % of GDP) 2014 4,0 2,6 3,0 7,7
Education Indicators
Gross Enrolment Ratio (%)
Primary School - Total 2010-2016 114,2 101,2 104,9 102,4 Primary School - Female 2010-2016 112,5 98,4 104,4 102,2 Secondary School - Total 2010-2016 88,2 52,6 71,1 106,3 Secondary School - Female 2010-2016 94,2 50,2 70,5 106,1Primary School Female Teaching Staff (% of Total) 2010-2016 60,0 47,1 59,8 81,0Adult literacy Rate - Total (%) 2010-2015 81,1 66,8 82,3 ...Adult literacy Rate - Male (%) 2010-2015 89,7 74,3 87,1 ...Adult literacy Rate - Female (%) 2010-2015 72,8 59,4 77,6 ...Percentage of GDP Spent on Education 2010-2015 6,3 5,0 4,0 5,0
Environmental Indicators
Land Use (Arable Land as % of Total Land Area) 2014 18,7 8,7 11,2 10,3Agricultural Land (as % of land area) 2014 64,8 41,7 37,9 36,4Forest (As % of Land Area) 2014 6,6 23,2 31,4 28,8Per Capita CO2 Emissions (metric tons) 2014 1,9 1,1 3,5 11,0
Sources : AfDB Statistics Department Databases; World Bank: World Development Indicators; last update :
UNAIDS; UNSD; WHO, UNICEF, UNDP; Country Reports.
Note : n.a. : Not Applicable ; … : Data Not Available. * Labor force participation rate, total (% of total population ages 15+)
** Labor force participation rate, female (% of female population ages 15+)
June 2017
0
10
20
30
40
50
60
70
80
90
100
20
00
20
05
20
09
20
10
20
11
20
12
20
13
20
14
20
15
Infant Mortality Rate( Per 1000 )
Tu nisi a Af r ica
0
500
1000
1500
2000
2500
3000
3500
4000
4500
20
00
20
05
20
09
20
10
20
11
20
12
20
13
20
14
20
15
GNI Per Capita US $
Tu nisi a Af r ica
0,0
0,5
1,0
1,5
2,0
2,5
3,0
20
00
20
05
20
09
20
10
20
11
20
12
20
13
20
14
20
15
Population Growth Rate (%)
Tun isi a Af r ica
01020304050607080
20
00
20
05
20
09
20
10
20
11
20
12
20
13
20
14
20
15
Life Expectancy at Birth (years)
Tu nisi a Af r ica
X
APPENDIX VII
TABLE OF AfDB OPERATIONS IN TUNISIA AS AT 30 SEPTEMBER 2017
Project Title Sector
Approval
Date
Effective
Date
Date 1st
disbursement Commitment
Disbursement
Rate
Completion
Date Age
NATIONAL GAS TRANSPORTATION AND
DISTRIBUTION NETWORK DEVELOPMENT Energy 04/01/2015 09/23/2015 03/02/2016 41,511,527.24 0.00 12/31/2017 2,52
SOUTH TUNISIAN GAS PIPELINE - TUNISIA Energy 06/26/2014 02/23/2015 03/18/2015 52,657,445.76 100.00 08/19/2027 3,28
Total Energy 94,168,973.00 56% STUDY - -RISK MANAGEMENT AND
ESTABLISHMENT OF AN AS SYSTEM Agriculture 08/02/2016 09/28/2016 02/08/2017 325,000.00 1.93 12/31/2018 1,18
GAFSA NORTH INTEGRATED AGRICULTURE
DEVELOPMENT PROJECT Agriculture 02/13/2013 02/14/2014 03/07/2014 18,587,313.73 41.41 06/30/2019 4,64
GABES II INTEGRATED AGRICULTURE
DEVELOPMENT PROJECT (PDAI) Agriculture 11/26/2014 06/23/2015 09/07/2015 17,357,684.97 22.98 06/30/2020 2,86
MIC GRANT FOR THE PREPARATION OF ZAGHOAUN
PDAI Agriculture 10/27/2014 11/28/2014 09/07/2015 390,000.00 45.37 12/31/2018 2,85
Total Agriculture 36,659,998.70 32%
RURAL DRINKING WATER SUPPLY PROGRAMME
(RWSSI)
Water and
Sanitation 10/12/2011 02/24/2012 02/24/2012 79,694,736.05 88.87 12/31/2018 5,99
RURAL DRINKING WATER SUPPLY PROGRAMME
Water and
Sanitation 09/06/2016 05/29/2017 05/29/2017 103,967,927.11 4.04 12/31/2021 1,08
RURAL DRINKING WATER SUPPLY PROGRAMME
Water and
Sanitation 09/06/2016 03/01/2017 03/01/2017 840,484.46 10.00 12/31/2021 1,08
DEVELOPMENT OF TUNISIA’S WATER VISION AND
STRATEGY 2050
Water and
Sanitation 06/20/2016 02/01/2017 02/14/2017 1,130,451.59 0.00 12/30/2018 1,29
TREATED WASTE WATER QUALITY IMPROVEMENT
PROJECT
Water and
Sanitation 01/11/2012 02/29/2012 05/15/2013 27,273,720.57 37.89 12/31/2018 5,74
Total Water and Sanitation 212,907,319.78 40% INCLUSIVE REGIONAL DEVELOPMENT SUPPORT
PROGRAMME (PADRI) Social 11/02/2016 12/19/2016 12/19/2016 151,287,201.94 100.00 12/31/2017 0,92
MIC - INVESTMENT PROMOTION SUPPORT PROJECT
AND Social 06/03/2015 08/11/2016 296,373.00 0.00 06/30/2018 2,34
Total Social 151,583,574.94 100% 0,00
INDUSTRIAL POLICY DESIGN SUPPORT PROJECT Ind/Mini/Quar 08/14/2015 11/19/2015 791,380.00 0.00 08/31/2017 2,15
STRUCTURAL TRANSFORMATION AND GROWTH Ind/Mini/Quar 08/14/2015 11/19/2015 04/24/2017 798,310.00 3.17 02/28/2018 2,15
XI
SECTOR
Total Ind/Mini/Quar 1,589,690.00 2% 0,00
STUDY TO DEVELOP A NATIONAL TRANSPORT
MASTER PLAN Transport 07/14/2014 11/28/2014 01/23/2015 800,000.00 11.30 06/30/2017 3,23
GABES-RAS-JEDIR HIGHWAY CONSTRUCTION
PROJECT Transport 06/21/2011 09/19/2011 04/13/2012 115,432,135.08 43.34 10/31/2019 6,30
ROAD INFRASTRUCTURE MODERNIZATION
PROJECT (PMIR) Transport 10/28/2015 02/25/2016 03/09/2016 121,029,761.55 18.30 12/31/2020 1,94
ROAD INFRASTRUCTURE MODERNIZATION
PROJECT (PMIR) Transport 10/28/2015 02/25/2016 03/09/2016 38,763,143.08 18.76 12/31/2020 1,94
ROAD INFRASTRUCTURE MODERNIZATION
PROJECT (PMIR) Transport 10/28/2015 11/19/2015 12/23/2015 1,200,000.00 0.00 12/31/2020 1,94
ENFIDHA AIRPORT PROJECT Transport 01/14/2009 03/13/2009 03/13/2009 57,097,655.05 100.00 01/01/2023 8,73
Total Transport 334,322,694.76 41%
FAPA TUNISIE PME BFPME Finance 08/05/2013 02/27/2014 02/27/2014 666 994,31 4.08 06/30/2018 4,17
FINANCIAL SECTOR MODERNIZATION SUPPORT
PROGRAMME Finance 07/13/2016 10/10/2016 10/10/2016 225,249,834.00 100.00 12/31/2017 1,23
AFRICAN SME PROGRAMME - LOC HANNIBAL
LEASE Finance 07/14/2017 6,723,875.64 0.00 07/08/2018 0,23
II° LINE OF CREDIT FOR THE BANQUE DE L'HABITAT Finance 02/27/2002 08/27/2002 08/27/2002 23,953,806.97 100.00 12/31/2006 15,61
BANQUE HABITAT TUNISIE - LOC II Finance 07/21/2003 12/18/2003 12/18/2003 67,238,756.42 100.00 03/31/2008 14,22
SME APEX FACILITY TUNISIA Finance 07/13/2011 02/24/2012 04/10/2013 35,104,963.84 70.43 07/22/2021 6,24
TRADE FINANCE LINE OF CREDIT TO BHT Finance 10/19/2016 02/27/2017 03/28/2017 50,429,067.31 100.00 08/27/2020 0,96
Total Finance 409,367,298.49 95% PUBLIC PROCUREMENT REFORM ACTION SUPPORT
PROJECT Multi-Sector 12/27/2013 04/02/2014 10/17/2014 530,100.00 41.40 12/31/2017 3,78
OPERATIONALISING PPPS IN TUNISIA (PPP
ADVISORY) Multi-Sector 06/14/2013 10/15/2014 10/15/2014 789,000.00 23.09 06/30/2018 4,31
Total Multisector 1 319 100,00 30%
GRAND TOTAL - (EXCLUDING MENA TF and TFT) 1,241,918,649.67 67%
XII
APPENDIX VIII
Project Area Map
This map has been provided by the staff of the African Development Bank exclusively for the use of the readers of the
report to which it is attached. The names used and the borders shown on this map do not imply on the part of the AfDB
Group and its members any judgement concerning the legal status of a territory nor any approval or acceptance of these
borders.