交通项目英文FF MOUFinal.docx

交通项目英文FF MOUFinal.docx

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交通项目英文FFMOUFinal

MEMORANDUMOFUNDERSTANDING

PRC:

ANHUIINTEGRATEDTRANSPORTSECTORIMPROVEMENTPROJECT

TATRIPARTITEREVIEW

（11-16May2009）

And

LOANFACTFINDINGMISSION

（21-27May2009）

I.INTRODUCTION

AMissionoftheAsianDevelopmentBank（ADB）fortheproposedAnhuiIntegratedTransportSectorImprovementProject（theProject）visitedAnhuiprovinceandBeijinginthePeople'sRepublicofChina（PRC）toconductaTATripartiteReviewMission（11-16May2009）andLoanFactFindingMission（21-27May2009）.TheMissionhelddiscussionswithAnhuiProvincialGovernment（APG）includingtheProvincialDevelopmentandReformCommission,FinanceDepartment,EnvironmentalProtectionDepartment（EPD）,LaborandSocialSecurityDepartment,Women'sFederation,TrafficPolice,AnhuiCommunicationsConsultingandDesignInstitute,AnhuiProvincialCommunicationsDepartment（APCD）,theexecutingagency（EA）fortheProject,andtheimplementingagencies（lAs）namelyAnhuiProvincialCommunicationsInvestmentGroupLimited（ACIG）,AnhuiHighwayAdministrationBureau（AHAB）,AnhuiTransportAdministrationBureau（ATAB）,and,andtheconsultants.TheMissiondiscussedtheProjectimpact,outcome,outputs,activitiesandinputs,Project'sinvestmentandfinancingplans,implementationarrangements,Project'sbenefits,assumptionsandrisks.Awrap-upmeetingwasheldinHefeion26May2009.AmeetingwillbeheldinBeijingon27May2009withtheMinistryofFinance（MOF）andtheNationalDevelopmentandReformCommission（NDRC）tobriefthemonthemissionfindingsandagreementsmadebetweentheMissionandAPG.TheMissioncarriedoutsitevisits,interviewedlocalpeopleandheldaconsultationmeetingwithlocalgovernmentofficialsandProjectareacounties.AlistofpeoplemetbytheMissionisattachedasAppendix1.

ThisMemorandumofUnderstanding（MOU）hasbeenpreparedtosummarizetheMissiondiscussions.Theagreementsreached,assetoutinthisMOU,aresubjecttotheapprovalofthehigherauthoritiesoftheCentralGovernmentofPRC（Government）andADB.

II.Rationale:

SectorPerformance,Problems,andOpportunities

A.PerformanceIndicatorsandAnalysis

Since1998,PRChasinvestedabout5%ofitsGDPinthetransportsector,65%ofwhichisforhighways.Thegrowthoftheroadassetshasexceededthegrowthrateoftheeconomy,andhelpedbridgethecountry'sinfrastructuregap.Overall,transportinvestmentshavebeenthekeytofosteringandspreadinggrowthfromtheeasterntothecentralandwesternregionsofPRC,leadingtopovertyreduction.Thedevelopmentofthenationaltransportnetworkhasbeenaccompaniedbythecontinuingdevelopmentoftheprovincialnetwork,forimprovedconnectivityandqualityofaccess.Thetransportsectorhasbeenamajorcontributortotheeconomicgrowthandpovertyreductionoverthelastfifteenyears.

LiketherestofPRC,Anhuiprovincehasgrownrapidlysincethe1990s,butatalowerpacethanitscoastalneighbors.TheprovinceremainstheleastdevelopedprovinceofcentralPRC.ItsGDPpercapita（CNY12,045in2007）isonly63%ofthenationalaverage.Nineteenoutofthehundredandfivecountiesoftheprovincearenationallydesignatedaspovertycounties.Ruralincomepovertyincidence,usingCNY1,500orPPP1.25aday,was10.5%in2007,muchhigherthaneasternneighboringprovinceslevels（about1-2%）andmorethanwesternandsouthernones（5-8.6%）.

Anhui'sdevelopmenthasnotablybeenconstrainedbyitsinfrastructure,whichdoesnotprovidethelevelsofquality,connectivityandaccessibilitynecessarytointegrateitwiththenationaleconomy.TransportdemandsinAnhuiprovincehavegrownatabout8.5%perannumsince2003（8.4%freightand8.8%passenger）,alowerratethanthenationalaverage（13.5%forfreightand9.4%forpassengers）.Particularly,Anhui'sroadnetworkisrelativelydensebutprovideslowlevelsofservicetothepopulation.Thetotallengthofhighways（148,372km）relativetoitspopulationbringstheprovinceinlinewithnationalaverage.However,thequalityoftheroadstandardsinAnhuiisrelativelylimited:

（i）thelengthofmainhighways（classIIorabove）isonly12,392km（8.4%）,lowerthanthenationalaverageof10.6%,（ii）thereareonly360kmofarterialroads（classI）,and（iii）only22%ofthenetworkpresentsasufficientqualityofsurfacing（asphaltconcreteorcementconcrete）.Thenetworkalsopresentsanunbalancedgeographicdistribution,astheverypopulatedandpoorernortherncountieshavelimitedaccesstothehigh-speedhighwaynetworkandthereforearenotintegratedwiththemajorindustrialcenteroftheYangtzeRiverdelta.

AnhuiGovernment'svisionistofosterasustainedgrowthandpovertyreductionintheprovincethroughthedevelopmentofanintegratedtransportnetwork.AccordingtoitsEleventhFive-YearPlan（11thFYP,2006-2010）,theprovincewilldevelopintegratedtransporthubsinsixmajorcities,linkallprovincialcitiesbyrailway,countycitiesbyexpressways,andprovidepavedaccesstoallvillages.Transportlinkswilldeepentheintegrationofthepoorestareaswithintheprovincialeconomyaswellasintegrationoftheprovincewithinthenationaleconomy.Duringthe11thFYP,totalinvestmentsintransportinfrastructureareexpectedtoreachCNY213.5billion（$31.4billion）:

CNY70billionforrailways（$10.3billion）,CNY125billionforhighways（$18.4billion）,CNY8.5billion（$1.3billion）forinlandwaterways,CNY5billionforcivilaviation（$0.7billion）andCNY5billionforpipelines（$0.7billion）.Theintegratedtransportationsystemwillprovide12majorhighwaycorridors（Eighttransversal,fourlongitudinal）connectingallprovincialcities,andintegratedintothecomprehensivetransportationnetworkoftheYangtzeDeltaRegion;basicallytoformasystematictransportationlinkagewithHefeiservingpassengertransitandWuhuservingtransitcargo

B.AnalysisofKeyProblemsandOpportunities

1.ChallengesandOpportunities

InclusiveGrowth.From1981to2004,PRCliftedhalfabillionpeopleoutsideofpoverty,anumberequaltothereductionofthenumberofpoorpeoplegloballyduringthesameperiod（from1.9billionto1.4billion）.However,PRCwasstillhomein2004to254millionpeopleconsuminglessthan$1.25in2005PPPdollars,accountingforabout18%ofthepoorintheworldandthesecondlargestconcentrationofpoorafterIndia.

AnhuiisalandlockedprovincelocatedinthecentralPRCwithalandareaof139,400km2.Ithasapopulationof65million,ofwhich63%areclassifiedasrural（amongthehighestinthecountry）,andissubstantiallyhigherthantheeasternprovinces（anaverage45%ruralpopulation）.Thepopulationdensityof470personsperkm2issignificantlyhigherthanthenationalaverageof138,andhigherthantheaveragefortheCentralRegion（355）.ItisoneofthepoorestprovincesofthecountrywiththeGDPpercapitaranked28thamongalltheprovinces,onlyaheadofGuizhou,Gansu,andYunnan.Theprovince'sGDPpercapitaistwotofourtimeslowerthanitseasternneighbors'（Shandong,JiangsuorZhejiang）andasitsruralincomeisthreetimeslowerthanitsurbanincome（respectivelyCNY3,556andCNY11,473in2007）.PovertyreductioninAnhuiwillrequirefurthergrowthintheprovince,andAnhui'sgrowthreachingitspoorerareas.

Thetransportsectorisplayingamajorroleinsharingthegrowthbetweenandwithinareas.Investmentsintheinlandregionsleadtothedevelopmentofwelllinkedgrowthhubs,andarethemostefficientinreducingtheregionalgapswithoutsacrificinggrowth.ThisisparticularlytrueforAnhui.Theprovince'simportantagriculturalpopulation,naturalresourcesandstrategicgeographiclocationmakesitparticularlywellpositionedtobeanimportantrawmaterialandagriculturalbaseforthemajoreasternindustrialcentersoftheYangtzeRiverdelta.However,forAnhuitomeetitsaccessibility,connectivityandcapacityneedsinthemedium-term,itisestimatedthattheprovincewillneedtodoublethelengthofitstrunkhighway（classIandabove）networktoreach5,000km..

PovertyReduction.PovertyinAnhuiisconcentratedintheHuaibeiPlaininthenortheastandDabieMountainAreainthesouthwest.TheHuaibeiPlainisamajorgrainproductionareabutitisflood-pronewhichhasrestricteditseconomicdevelopment;andagriculturealonecannotsupporthighincomelevels.Backwardtransportisalsoconsideredoneofthemajorconstraintsofpovertyreduction,especiallyinthesouthwest.IncreasedaccessofremoteareastoAnhui'stransportationsystemisonepillaroftheprovince'spovertyreductionstrategy.

TheProjectareaincludesseveralpoorcountiesinHuaibeiplain,suchasLingbiandSixian,whoseGDPpercapitaisonly57%oftheprovincialaverageandwherepovertyincidencereachesrespectively19.6%and18%.ThegrowthrateofthoseruralareashaslaggedbehindAnhuibytwotofivepointssincethebeginningofthe1995,andbyfourtosevenpointsbelowJiangsu.ThoseareasaremajortargetsoftheprovincialpovertyreductionprogramandwouldparticularlybenefitfrombetterconnectivitywiththeimportantmarketsandindustrialpolesofXuzhouandNanjing.ThenewexpresswayandtheupgradingoflocalroadX056willbenefittwoprovincialpovertycountiesinthenortheast.Inaddition,threelocalroadstoberehabilitatedwillbenefitthreenationalpovertycountiesinthesouthwest（forexample,thepovertyincidenceinYuexiisveryhighat29.5%）.Consequently,Projectinvestmentinthehighwayandlocalroadsnetworkisakeyinterventionforpovertyreduction.

Accessible,AffordableandSafePublicTransport.ThepublictransportservicesinAnhuiarelessdevelopedt