ANNEX. Action fiche: "Feasibility and detailed design for Berbera-Togochale Road (Berbera Addis Ababa Corridor)

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1 ANNEX Action fiche: "Feasibility and detailed design for Berbera-Togochale Road (Berbera Addis Ababa Corridor) 1. IDENTIFICATION Title/Number Feasibility and detailed design for Berbera-Togochale Road (Berbera Addis Ababa Corridor) FED/2010/ Total cost EU Contribution - EUR Aid method / Method of implementation EDF Envelope A Project approach partially decentralised management DAC-code Sector Road Transport 2. RATIONALE 2.1. Sector context The Infrastructure Development of the Horn of Africa Initiative (HOAI) aims at strengthening cooperation between Intergovernmental Authority on Development (IGAD) and the EU in order to enhance regional inter-connectivity in the Horn of Africa region. The IGAD strategic orientation on infrastructure development as captured in the HOAI is to develop a conducive environment for prompting private businesses and investments. This is in tandem with the EU s current policy orientation of operationalising a Partnership for Infrastructure which should encompass investments in trans-boundary and regional infrastructure and their regulatory frameworks in the widest sense: transport networks (roads, railways, inland waterways, ports and airports), water and energy infrastructure and connections as well as ground-based and space-based electronic communications infrastructure and services. The present study for the rehabilitation of the missing link Addis-Berbera is also consistent with the European Consensus on Development which prioritizes cooperation and support to Regional Integration Organisations (RIOs), and other major partners, including the private sector in infrastructure development. Consideration has also been taken to ensure that the interventions proposed are consistent with and feed into the policy orientations of the EU and Eastern and Southern Africa-Indian Ocean (ESA-IO). In particular, the project is currently under consideration for inclusion in the TCS/PIP study developed by the Common Market for Eastern and Southern Africa (COMESA) to prioritise interventions in this field in the whole ESA region Lessons learnt The design and identification of this project has taken into account and complements other projects that have been supported by the EU under the 9 th European Development Fund

2 (EDF). To this end, lessons learnt from the Ethiopia-Djibouti rail and road projects funded under the 9 th EDF as well as the Addis Ababa-Nairobi-Mombasa road corridor funded under AfDB/EC will be fully utilised in this proposed project. For example, previous projects showed the initial difficulties of recruiting a consultants team within a relative short period of time due to the hardship of the workplaces. For this reason, in the current project one month has been dedicated to advertisement and recruitment procedures, and consultants fees have been estimated in the budget taking in consideration the challenging environment. One of the major lessons learnt, also from other Donors experience in the sector, has emphasised the need to select new interventions with a more holistic perspective, looking at the comparative advantages gained by the whole network, both in term of network consolidation and in enhancement of regional integration. This is what the Horn of Africa Initiative (HOAI) seeks to achieve in its interconnectivity agenda, and what has been applied by selecting this missing link Togochale-Berbera that would enable the connection of Addis Abeba to the port of Berbera, in line with the Ring Approach identified by national experts during their meeting in Mombasa (May 2009) and endorsed by IGAD Council of Ministers (Dec 2009) and by the HOAI regional National Authorising Officer (NAO) meeting recently held in Nairobi (July 2010) Complementary actions The EU response strategy in addressing infrastructural challenges within Regional Integration Organisations is captured in EU Strategy for Africa as well as the HOAI. Aspects of this response strategy have further been captured in the two Joint Assessment Missions (JAM) reports (2008 and 2009). The design of this project and response strategy thereof builds on the achievements of programmes financed under previous EDFs aimed at supporting infrastructure development. Apart from the HOAI, this project builds on the on-going ESA-IO efforts, funded under the 9 th EDF, to develop a Transport and Communication Strategy and a Priority Investment Plan (TCSPIP), which will provide the criteria to identify key regional infrastructure projects and build capacity to deal with investment plans. The project further complements activities of a concerned partner country (Ethiopia), whose Roads Authorities are currently paving the Jiggiga-Togochale road (Ethiopian part of the Berbera corridor). Although Ethiopian Roads Authorities do not possess sufficient resources for construction, they have showed a strong interest in supporting Somaliland maintenance service of the road up to Berbera. During the recent regional NAO meeting, Ethiopian and Somali senior officials from the Ministries of Transport and Finance stated once more the importance they attach to this project for the economic and trade development of their respective regions. The project thus complements a shared priority of the two countries concerned. With respect to EU development policy papers, the project is consistent with the European Consensus on Development, committed to promoting a sustainable transport sector in support of efforts to eradicate poverty. Furthermore, it is responding to the objectives set in the EU Strategy for Africa with its focus on enhancing interconnectivity on regional integration and the EU-Africa Partnership for Infrastructure to support Trans-African networks.

3 2.4. Donor coordination In the identification phase of this project, actions carried out by other donors, such as the World Bank, the African Development Bank (on the Mombasa/Nairobi/Addis Ababa corridor), the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) and the United States Agency for International Development (USAID) in the sub region have been taken into account. In particular, the World Bank is currently running minor rehabilitation works (e.g. short-term covering of potholes) on the Somali section as part of their EUR 5 million Quick Impact Programme to enhance job creation. Berbera port is of particular importance, as the port plays a significant role in supporting WFP operations in Ethiopia. The project is in line with the RDP Reconstruction and Development Plan for Somalia, whose Joint Needs Assessment (carried out by the United Nations and World Bank in 2006) states that: Regional interconnectivity and establishing economic corridors is important for Somalia as a whole and Somaliland in particular. The corridor with the most interregional/country connections is the Berbera Corridor road, which provides an important link between the Berbera Port and Ethiopia DESCRIPTION 3.1. Objectives The overall objective is to contribute to the promotion of interconnectivity and to the facilitation of trade and transport by developing the elaboration of the Berbera-Togochale road link project to a bankable level, as a missing link within the Berbera-Addis Corridor. Specific objectives of the proposed project will be: 1. To provide Somali and Ethiopian decision makers with the means and information to select the best option for the construction, rehabilitation and maintenance of the link. 2. To identify ways to strengthen the capacities of road authorities of the two countries (in particular Somaliland Road Authorities) in order to ensure that maintenance activities are carried out once the road construction is concluded and opened to traffic 3. To produce updated and new information and identify the required trade measures (through an implementation plan ) contributing to regional cooperation and integration through the development of economic port activities in Berbera and enhanced traffic on the link Expected results and main activities Result: feasibility study and detailed design delivered for the link Togochale - Berbera. These reports include (but are not limited to) the following: an assessment of the relevance of the proposed project, including the whole Berbera Addis Ababa corridor, to address the problems identified at institutional, economic and social level and any additional problem arising in this road section; 1 p. 8, SOMALI JOINT NEEDS ASSESSMENT- INFRASTRUCTURE CLUSTER REPORT - September 2006 (Sept. 10 RVS. VSN.) Available at:

4 a detailed axle load analysis of the whole Berbera Addis Ababa corridor. Measures for control and enforcement are expected to be recommended in the report 2. a detailed analysis of the technical, economic and financial, institutional and management, environmental and social feasibility of the Togochale Berbera link, including an implementation plan suggesting trade measures to enhance regional cooperation and integration through the development of economic port activities in Berbera and enhanced traffic on the Berbera-Addis road; a detailed analysis of the potential sustainability of the expected project objectives and results, including a plan for capacity building activities for relevant authorities on maintenance if necessary; the detailed plan which specifies indicators for project activities (input, output), results (outcome) and objectives (impact) and incorporates required resources, the institutional structure required for project implementation, the definition of responsibilities of stakeholders, project timing, estimated cost and logical framework matrix; detailed design and tender documents for works, supplies and services for the Togochale Berbera link. The results of the detailed surveys shall be analysed to establish the final design of the alignment, drainage structures, bridges, protection work, side slopes and the construction techniques to be adopted in accordance with the International Standards and consistent with Ethiopian Road Standards. With the aid of traffic projections, a trade facilitation specialist will additionally look into ways to maximise the benefits of the road by suggesting accompanying measures to facilitate trade (time saving measures, token and additional tariffs regulations, bilateral trade agreements, etc.). The Environmental and Social Impact Assessment report will also look at the potential impact of the road and subsequent enhanced traffic on cross-cutting issues such as environment, gender, women and youth development and HIV/AIDs, and will propose ways to minimise/counteract potential negative spill-over effects in these fields (e.g. hot spots such as the border post between Somaliland region & Ethiopia would be identified for inclusion in regional HIV/AIDS programmes) Risks and assumptions This project has been identified with the cooperation of the IGAD and Member States on the assumption that they are committed to the Horn of Africa Initiative. It is therefore assumed that there will be sufficient will from the stakeholders to implement the HOAI roadmap. It is noteworthy that the result areas under this project are based on the implementation of the HOAI priority programmes which were identified and agreed upon in the Mombasa meeting (JAM2) in 2009, and that senior officials from the ministries of the 2 countries re-stated their keen interest in the project during the recently held regional NAOs meeting (July 2010). It is 2 According to an official of Somaliland Road Authority (12/09/2010) an axle load control act has been prepared and will be presented to the Council of Ministers for approval

5 further assumed that the IGAD has and/or will be able to mobilise the required technical and human resource capacities to implement the programme. The feasibility study and detailed engineering could lose its value and be outdated if works on the road section and revamped port activities happen in a distant future. However, there are significant indications that the corridor can attract the interest of a number of stakeholders to engage in actual works on the segment. As mentioned above, Ethiopian authorities are currently paving the Jiggiga-Togochale road near the border, and displayed a strong interest in opening an additional route to access Somali port facilities. On the other hand, private investors have engaged in talks with Somali authorities for the enhancement of management capacities of the Berbera port facilities and for rehabilitation and construction works on this road. Axle overload could threaten the long-term integrity of the road, currently a major issue for some road sections in Ethiopia. To mitigate this risk, donors are already engaged in creating awareness and advocating for increasing controls and fines (current fines are considered not to be proportionate to the damage caused by overloaded vehicles). For example, in the EC Second Road SPSP the percentage of axles overloaded by 20% or more is a performance indicator for the release of instalment payments. This indicator showed a sharp improvement in the most recent years: according to the most recent data presented by Ethiopian Road Authority 3 the percentage for 2009/2010 is 12.3%, compared to 30% for 2006/2007 and 29.8% for 2008/2009. On the other side of the border, an axle load control act is currently being discussed in Somaliland and will soon be presented to the Council of Ministers for approval. This legislative measure, once approved, will give full authority to the SRA to enforce axle load control to protect the road. Finally, the existence of conditions necessary for the implementation of the project is also a concern. These include security, political stability and continued institutional reforms. There are efforts at ensuring that there is peace and security in the region and the initiatives on institutional strengthening in IGAD are also registering success. It is therefore hoped that this risk will be mitigated by such initiatives Crosscutting Issues Environmental sustainability Positive and negative effects of road construction activities on the immediate surrounding natural plant, wildlife and human environment will be identified during the feasibility study and appropriate preservation and protection measures shall be proposed in the Environmental Impact Study. An Environmental Management Plan (EMP) will be developed to be implemented during construction. The potential negative impacts on the environment arise largely from the construction operations and the EMP will be set the required measures to limit their impacts. These impacts include road widening, improving drainage and obtaining fill, gravel and hard rock from borrow pits and quarries. A major benefit of a paved road is the consequent removal of the dust pollution generated by traffic travelling at speed on the gravel road

6 Gender and other socio-cultural aspects The project will facilitate the provision of basic social services and will study the social impacts with a view to providing better short term and longer term employment and income generating opportunities including women. The social assessment report shall identify the social impacts and recommends mitigation measures that will be incorporated in the contract documents. Good Governance and Human Rights The IGAD Organisation as a regional block is constantly advocating for good governance and the rule of law. Attention to the road s impact on human rights, and women s and children s rights in particular, will be given in the social report along with proposed measures to counteract potential negative effects. Provisions to protect health and safety at work will also be included in the project design and indicated for the time of construction. Good governance will be observed to ensure ownership of the project at both top and bottom level. Government and local authorities stakeholders will be involved through the steering committee mechanisms and through the planned capacity building activities, while local community members will be involved to assess the social and trade implication of the road, as well as being consulted before proposing alternative paths to the currents roads (if such changes are necessary) Stakeholders There are a number of stakeholders that are directly or indirectly involved in the development of this project. Stakeholders at the regional level include IGAD and other Regional integration Organisations such as the Common Market for Eastern and Southern Africa (COMESA) and the African Union. The two countries of Ethiopia and Somalia (Somaliland) will be the major beneficiaries of the project. The road authorities (Ethiopian Road Authority (ERA) and Somaliland Road Authority) and the port authorities in Somalia will be directly involved in the feasibility study and their capacity strengthened throughout the project. Relevant Ministries (Transport, Infrastructure and Trade) will also need to be involved from the inception of the study, to secure their constant support and harmonise this intervention with their national planning. The local population in the project zone of influence will equally benefit from the project in particular the environmental, social and trade studies will minimise negative side effects of the road construction, while enhanced transit will increase small trade in the area, and ease freedom of movement and access to facilities. Major beneficiaries of the rehabilitation of the road within the private sector will be all organisations involved in trade between Ethiopia, Somalia and international import/export organisations and transporters, including businesses related to port activities. Other beneficiaries are the road users through reduced vehicle operating costs and time savings; and the population of land-locked Ethiopia through lower transport costs and increased transit security in the event of natural disasters. The owners of the proposed study are the Government of Somalia, Somaliland Road Authority and IGAD, while the overall responsibility for the implementation of the project lies with the Regional Authorising Officer (RAO). The Steering Committee comprises the representatives of the road authorities in both Ethiopia and Somaliland, a representative from Berbera Port Authorities, a representative from the EU Delegations in both Ethiopia and for

7 Somalia. The IGAD Secretariat will be the focal point and the Committee s facilitator. The Committee shall review and approve the interim and final report, including the capacity building maintenance programme. In addition, it will discuss any extra-ordinary issues as needed. The Committee will finally decide for a final presentation of the study to national authorities and potential investors, to contribute linking the study to the subsequent construction phase and thus avoid the outdating of the study. 4. IMPLEMENTATION ISSUES 4.1. Method of implementation Partially decentralised management through the signature of a Financing Agreement with IGAD as Regional Authorising Officer in accordance with Articles 21 to 24 of the Financial Regulation of the 10 th EDF. The Commission controls ex ante all the procurement and grant procedures. Payments are executed by the Commission. The change of management mode constitutes a substantial change except where the Commission "re-centralises" or reduces the level of tasks previously delegated to the beneficiary country, international organisation or delegated body under, respectively, decentralised, joint or indirect centralised management Procurement and grant award procedures All contracts implementing the action must be awarded and implemented in accordance with the procedures and standard documents laid down and published by the Commission for the implementation of external operations, in force at the time of the launch of the procedure in question. Participation in the award of contracts for the present action shall be open to all natural and legal persons covered by the Financial Regulations of the 10 th EDF. Further extensions of this participation to other natural or legal persons by the concerned authorising officer shall be subject to the conditions provided for in 20 of Annex IV of the revised Cotonou Agreement 4.3. Budget and calendar The overall budget is EUR The indicative timeframe for launching the tender is the beginning of 2012, after the financing decision and signature of financing agreement. The operational period will be 36 months from the date of signing the financing agreement. Activity Amount (in EUR) Feasibility and design study (service contract) Contingencies Visibility Total

8 4.4. Performance monitoring The Steering Committee, the Regional Authorising Officer (RAO) and the EU Delegations involved will be closely associated with the monitoring of the study implementation. Reporting on the project will be done in accordance with the contractual clauses for service contracts (every 6 months) Evaluation and audit Considering the nature and the objective of this action, which is a feasibility study, no evaluation will be carried out. As far as audits are concerned these are included in the service contract to be signed (expenditure verification on 6 monthly basis) Communication and visibility Communication and visibility activities will be implemented in accordance with the EU s Visibility Guidelines for External Action 4. On the basis of these guidelines, the Steering Committee will develop its own modalities for communication and visibility; they will however include among others (and be included in the service contract to sign): A disclaimer in all publications of the study. Banners to be displayed at the final presentation of the studies to national authorities and potential donors. 4 Communication and Visibility Manual for European Union External Actions, July 2009: