AFRICAN DEVELOPMENT BANK

RWANDA

SUSTAINABLE WATER SUPPLY AND SANITATION PROGRAM

APPRAISAL REPORT

RDGE/AHWS November 2017

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TABLE OF CONTENTS

I – STRATEGIC THRUST & RATIONALE ................................................................................. 1

1.1 PROGRAM LINKAGES WITH COUNTRY STRATEGY AND OBJECTIVES ...................................... 1

1.2 RATIONALE FOR BANK’S INVOLVEMENT ................................................................................ 1

1.3 DEVELOPMENT PARTNER COORDINATION .............................................................................. 2

II – PROGRAM DESCRIPTION ...................................................................................................... 3

2.1 PROGRAM OBJECTIVE .............................................................................................................. 3

2.2 PROGRAM COMPONENTS ......................................................................................................... 3

2.3 TECHNICAL SOLUTION RETAINED AND OTHER ALTERNATIVES ............................................. 4

2.4 PROGRAM TYPE ....................................................................................................................... 5

2.5 PROGRAM COST AND FINANCING ARRANGEMENTS ................................................................ 5

2.6 PROGRAM’S TARGET AREA AND POPULATION ....................................................................... 6

2.7 PARTICIPATORY PROCESS FOR PROGRAM IDENTIFICATION, DESIGN AND IMPLEMENTATION 7

2.8 BANK GROUP EXPERIENCE, LESSONS REFLECTED IN PROGRAM DESIGN ............................... 7

2.9 KEY PERFORMANCE INDICATORS ............................................................................................ 8

III – PROGRAM FEASIBILITY ........................................................................................................ 8

3.1 ECONOMIC AND FINANCIAL PERFORMANCE ........................................................................... 8

3.2 ENVIRONMENTAL AND SOCIAL IMPACTS ................................................................................ 9

IV – IMPLEMENTATION ............................................................................................................... 12

4.1 IMPLEMENTATION ARRANGEMENTS ..................................................................................... 12

4.2 MONITORING AND EVALUATION ........................................................................................... 14

4.3 GOVERNANCE ........................................................................................................................ 14

4.4 SUSTAINABILITY .................................................................................................................... 15

4.5 RISK MANAGEMENT .............................................................................................................. 16

4.6 KNOWLEDGE BUILDING ......................................................................................................... 17

V – LEGAL INSTRUMENTS AND AUTHORITY ...................................................................... 17

5.1 LEGAL INSTRUMENT .............................................................................................................. 17

5.2 CONDITIONS ASSOCIATED WITH BANK’S INTERVENTION ..................................................... 17

5.3 COMPLIANCE WITH BANK POLICIES ...................................................................................... 18

VI – RECOMMENDATION ............................................................................................................. 18

APPENDICES ............................................................................... ERREUR ! SIGNET NON DÉFINI.

APPENDIX 1: RWANDA’S COMPARATIVE SOCIO-ECONOMIC INDICATORS .......................................... I

APPENDIX 2: TABLE OF AFDB’S PORTFOLIO IN THE COUNTRY ........................................................ II

APPENDIX 3: KEY RELATED PROJECTS FINANCED BY THE DPS IN THE COUNTRY .......................... III

APPENDIX 4: PROGRAM LOCATION MAP .......................................................................................... IV

Currency Equivalents

June 2017

UA 1 = RWF 1134.1256

UA 1 = USD 1.38432

UA 1 = EUR 1.23369

FISCAL YEAR:

July 1 – June 30

Weights and Measures

1 metric ton = 2,204 pounds (lbs)

1 kilogram (kg) = 2.200 pounds (lbs)

1 meter (m) = 3.28 feet (ft)

1 millimeter (mm) = 0.03937 inch (“)

1 kilometer (km) = 0.62 mile

1 hectare (ha) = 2.471 acres

i

ACRONYMS AND ABBREVIATIONS

ADB African Development Bank PCR Project/Program Completion Report

AfDB African Development Bank Group PD Presidential Directive

ADF African Development Fund PFMU Project Financial Management Unit

AGTF Africa Growing Together Fund PMP Procurement Methods and Procedures

BPS Borrower Procurement System RAP Resettlement Action Plan

CORW Bank’s Rwanda Country Office RBLF Result Based Logical Framework

CPIA Country Policy and Institutional Assessment

RDB Rwanda Development Board

CPPR Country Portfolio Performance Review RDHS Rwanda Demographic Health Survey

CSP Country Strategy Paper REG Rwanda Energy Group

CSO Civil Society Organization RMC Regional Member Country

CSS Climate Safeguards System RPPA Rwanda Public Procurement Authority

DP Development Partner RURA Rwanda Utilities Regulatory Authority

DPCG Development Partners Coordination Group RWF Rwanda Franc

EAC East African Community SDC Swiss Agency for Development and Cooperation

EDPRS Economic Development and Poverty Reduction Strategy

SDG Sustainable Development Goal

EIA Environmental Impact Assessment SEP Stakeholder Engagement Plan

EIB European Investment Bank SPIU Single Project Implementation Unit

EIRR Economic Internal Rate of Return SWG Sector Working Groups

ENPV Economic Net Present Value UA Unit of Account

ESAP Environmental and Social Assessment Procedure

UNICEF United Nations Children’s Fund

ESIA Environmental and Social Impact Assessment

USD United States Dollar

ESMP Environmental and Social Management Plan

WASAC Water & Sanitation Corporation Limited

EWSA Energy, Water & Sanitation Authority

FIRR Financial Internal Rate of Return

FM Financial Management

FNPV Financial Net Present Value

GDP Gross Domestic Product

GoR Government of the Republic of Rwanda

IIAG Ibrahim Index of African Governance

IP Implementation Progress

IPR Implementation Progress Report

ISS Integrated Safeguards System

IWRM Integrated Water Resources Management

JICA Japan International Cooperation Agency

KPI Key Performance Indicators

M&E Monitoring & Evaluation

MDG Millennium Development Goal

MINALOC Ministry of Local Government

MINECOFIN Ministry of Finance and Economic Planning

MININFRA Ministry of Infrastructure

MINIRENA Ministry of Natural Resources

MIS Monitoring and Information System

MLFM Movement for the Fight Against Hunger in the World

NGO Non-governmental Organization

NPV Net Present Value

NRW Non-Revenue Water

O&M Operation and Maintenance

OAG Office of the Auditor General

PAP Project Affected Person

ii

LOAN INFORMATION

Client’s information

Borrower: Republic of Rwanda

Executing Agency: Water & Sanitation Corporation Limited (WASAC)

Financing plan

Source Amount (million UA) Instrument

ADB 87.508 (USD 121.137m) Loan

AGTF 36.119 (USD 50.000m) Loan

EIB 36.476 (EUR 45.000m) Loan

GoR 29.391 (USD 40.687m) Counterpart

Total Cost 189.494 (USD 262.318m)

ADB’s and AGTF’s key financing information

Loan Currency USD

Loan Type Fully Flexible Loan

Tenor 25 years inclusive of grace period

Grace period 8 years

Repayments Consecutive semi-annual payments after grace period

Interest Rate Base Rate +Funding Cost Margin+ Lending Margin + Maturity Premium

Base Rate Floating Base Rate (6-month USD LIBOR reset each 1st February and 1st

August). A free option to fix the Base Rate is available.

Funding Cost Margin The Bank funding cost margin as determined each 1st January and 1st July

and applied to the Base Rate each 1st February and 1st August

Lending Margin 80 basis points (0.8%)

Maturity Premium 0.20%

Front-end fees 0.25% of the loan amount payable before 1st disbursement.

Commitment fees 0.25% of the undisbursed amount. Commitment fees start accruing 60

days after signature of the loan agreement and are payable on Payment

dates.

Option to convert the Base Rate In addition to the free option to fix the floating Base Rate, the borrower

may reconvert the fix rate to floating or refix it on part or full disbursed

amount. Transaction fees are payable.

Option to cap or collar the Base

Rate

The borrower may cap or set both cap and floor on the Base Rate to be

applied on part or full disbursed amount. Transaction fees are payable.

Option to convert loan

currency*

The borrower may convert the loan currency for both undisbursed and/or

disbursed amounts in full or part to another approved lending currency of

the Bank. Transaction fees are payable. * Not applicable to AGTF

Key financial and economic analysis information

FNPV (at 10% base case) RWF 73,369 million (at 10% base case)

FIRR (at 10% base case) 15.42%

ENPV (at 10% base case) RWF 164,882 million (at 10% base case)

EIRR (at 10% base case) 22.82%

iii

Timeframe - Main Milestones (expected)

Concept Note Approval January 2017

Program Approval November 2017

Effectiveness February 2018

Completion December 2021

Last Disbursement June 2022

iv

Program Summary

Program

Overview

The development objective of the program is to improve the quality of life and socio-economic

development of the people and country by ensuring equitable provision of adequate, reliable and

sustainable water and sanitation services for targeted cities with a view to promote economic

growth and transformation. The program objective will be achieved through: 1) Water Supply

Infrastructure and Services Improvement; 2) Sanitation Infrastructure and Services

Improvement; and 3) Institutional Support.

The proposed overall program will be implemented in the City of Kigali and the satellite cities

of Rubavu, Rusizi, Nyagatare, Muhanga, Huye, Musanze and Karongi covering water supply

and sanitation sub-projects. Over the program horizon, about 1.1 million people will be provided

with improved water supply services and 475,000 people will have access to improved sanitation

services. The program benefits include: (a) improved reliability and sustainability of the water

supply and sanitation services; (b) overall improvement of the public health situation in the target

cities and their surrounding areas, as a result of more reliable improved water supply and

sanitation services, and (c) an enhanced operation & maintenance (O&M) capacity of Water &

Sanitation Corporation Limited (WASAC).

An African Development Bank (ADB) loan (USD 121.137m) and Africa Growing Together

Fund (AGTF) loan (USD 50.000m) will cover 65.24% of the program costs. The program is

expected to be implemented over 48 months starting in January 2018, while European Investment

Bank (EIB) and the Government of the Republic of Rwanda (GoR) will contribute 19.25% (EUR

45.000m) and 15.51% (USD 40.687m) respectively.

Needs

Assessment

The GoR has shown consistent commitment to sector reforms and economic transformation,

pursuant to its Vision 2020, which accords high priority to the development of infrastructure

services in order to sustain resilient development and achieve middle income status. With

inadequate infrastructure continuing to be a major cause of the high cost of doing business and

subduing private business activities and further economic transformation, the Economic

Development and Poverty Reduction Strategy (EDPRS) II’s focus on the need to scale up

infrastructure investments, especially transport, energy and water, so as to reduce the cost of

doing business and to increase value addition in agriculture, industry, and service sectors cannot

be over emphasised.

The Vision 2020 necessitates scaling up investments in reliable, affordable and environmentally

sustainable infrastructure and services. Water and sanitation services are defined as key drivers

and enablers for economic transformation and rural development. Accordingly, EDPRS II has

targeted to increase access to improved water supply and sanitation to 100% from 72.3% and

58.3% respectively (2015).

Bank’s Added

Value

This program fits within the pillar 1 of the Bank’s Country Strategy Paper (CSP) 2017–2021,

“Investing in energy and water infrastructure to enable inclusive and green growth” and directly

contributes to outcome: “increased access to affordable and reliable energy and water supply and

sanitation”. By providing sustainable and affordable water and sanitation services, the program

will lay foundations for industrialization and food security, enhance the sources of economic and

social resilience of the people, and contribute to improved quality of life for the people which

are in line with the five (5) priority areas of focus (High-5s) geared to advance Africa’s

transformative agenda and to deliver the outcomes of the Bank’s Strategy for 2013-2022.

Knowledge

Management

The program will generate critical knowledge for the performance of the water and sanitation

sector in the country, which will build up lessons for the design and management of similar

interventions, to be adapted for replication throughout the country as well as in other regional

member countries (RMCs). Given that the program covers strategic cities in wide geographic

areas, there is potential to generate useful lessons. In line with the Bank’s Knowledge

Management Strategy 2015-2020, the knowledge obtained will be captured, documented and

shared within the Bank and with other development partners (DPs) and RMCs.

Through the implementation of the program, WASAC will learn the Bank’s procedures and

safeguards which they will be able to replicate in future development work.

v

Results Based Logical Framework COUNTRY AND PROGRAM NAME: RWANDA SUSTAINABLE WATER SUPPLY AND SANITATION PROGRAM PROGRAM DEVELOPMENT PURPOSE: TO IMPROVE THE QUALITY OF LIFE AND SOCIO-ECONOMIC DEVELOPMENT BY ENSURING EQUITABLE PROVISION OF ADEQUATE, RELIABLE AND SUSTAINABLE WATER

AND SANITATION SERVICES FOR TARGETED CITIES

RESULTS CHAIN

PERFORMANCE INDICATORS MEANS OF

VERIFICATION

RISKS/MITIGATING MEASURES

Indicators Baseline (2015)

Target (2021)

IMP

AC

TS

Improved quality of life of the population

Population living below the poverty line 39.1% (2013/14)

23.8 Government statistics Census data. Sources include Rwanda National Institute of Statistics, Rwanda Utility Regulatory Authority, Integrated Household Living Conditions Surveys, UN Inter-agency Group for Child Mortality Estimation.

Prevalence of Diarrhea among children ( % of children under 5)

8.7% 4.2%

Primary and secondary school enrollment rate 96.9%, 28.3% 100%, 98%

OU

TC

OM

ES

1. Improved access to water supply and management

Water supply service coverage: Kigali & 6 satellite cities 73% 100% RISK 1: Cost recovery limitations. Mitigation: tariff under review for submission to RURA for approval. RISK 2: Limited skills to operate and maintain sewerage system. Mitigation: 2 year technical support by the contractor to build capacity of WASAC.

Population using safely managed water services 1,621,000 2,722,000 (52% female) NRW management (% of NRW) 35% 25%

2. Improved access to sanitation and environmental protection

Population covered by central sewerage system (Kigali City)

0% 15%, 294,480 (52 %

female) Population benefiting from faecal sludge treatment plants and solid waste landfills

0

181,000 (52% female) (Rubavu: 112,000; Musanze: 47,000; Karongi: 14,000; Rusizi 8,000)

3. Increased employment No. of Temporal Jobs created ( disaggregated by gender) - 28 800 (30% female)

No. of Permanent jobs created for O&M - 240 (30% female)

OU

TP

UT

S

COMPONENT 1: WATER SUPPLY INFRASTRUCTURE AND SERVICES IMPROVEMENT RISK 3: Delays in program implementation. Mitigation: Advance procurement commenced. RISK 4: The resettlements and compensation not being handled properly. Mitigation: consultations have already started involving stakeholders. Awareness exercises directed at the identified PAPs are ongoing.

Water production capacity Water production increased (2 treatment plants - Mwoya, Gihira)

8,000m3/day 29,000m3/day

Government and Program reports, including progress, quarterly, mid-term and completion Sources include Implementing Agency (WASAC), Bank mission reports

Water storage capacity No. and capacity of water storage tanks built for urban scheme

- 58; 54,400m3

Water distribution Length of rehabilitated and new pipelines laid & operational - 1,600km District /bulk metering No. of new district/bulk meters installed (Kigali City) 0 38 COMPONENT 2: SANITATION INFRASTRUCTURE AND SERVICES IMPROVEMENT Sewerage infrastructure (Kigali City)

Length of sewerage pipelines in centralized system 0 89.6 km (new) Household/business connections to centralized sewerage system

0 2,300

Operational Central sewerage treatment facilities 0 1 (new) Onsite sanitation and solid waste management (satellite cities)

Faecal sludge treatment plants built - 4 Solid waste landfills built with Incinerators - 4 No. of gender sensitive on-site school sanitation facilities - 4

COMPONENT 3: INSTITUTIONAL SUPPORT

Staff capacity/training No. Staff trained -

242 (50% female) (WASAC: 65; Districts: 30; Private operators: 147)

Central water and wastewater laboratory built none 1 Water and sanitation operations training center built none 1

Support to youth and job creation

No. of professional interns trained 10 52 (50% female)

ESMP implementation ESMP implemented - Implemented

vi

KE

Y A

CT

IVIT

IES

ACTIVITIES INPUTS (USD million)

Component 1- -Water Supply Infrastructure and Services Improvement: Rehabilitation, upgrading and extension of water supply network in Kigali City; Construction and upgrading of Nzove Water Treatment Plant*; Construction of Gihira II Water Treatment Plant and Rehabilitation of existing Gihira Water Treatment Plant; Rehabilitation and extension of water supply distribution networks in the 6 Satellite cities; and Studies for future investments. Component 2- Sanitation Infrastructure and Services Improvement: Rehabilitation and upgrading of semi-centralized sewerage systems in Kigali estates; Construction of Kigali centralized sewerage system; Construction of faecal sludge treatment plants and modern solid waste landfills in s 4 satellite cities; and Provision of latrines for schools. Component 3-Institutional Support: Capacity development on O&M of infrastructure and service delivery; and Construction of water & wastewater testing central laboratories and training center for WASAC. Component 4 Program Management: Program management support (audit, operating expenses, procurement of vehicles etc.); and Land acquisition*

million UA

million USD

ADB 87.508 121.137

AGTF 36.119 50.000

EIB 36.476 50.494

GoR 29.391 40.687

Total 189.494 262.318

* Activity funded by GoR

vii

PROGRAM IMPLEMENTATION SCHEDULE

Component 1: Water Supply Infrastructure and Services Improvement

Component 2: Sanitation Infrastructure and Services Improvement

Component 3: Construction of Central Water and Wastewater Laboratory and Water and Sanitation Operations Training Center

Component 4: Program Management

Project Disbursment Deadline - Jun. 2022

2-6 Rehabilitation and upgrading of semi-centralized systems

3-1 Central Water & Wastewater Laboratory

3-2 Water and Sanitation Operations Training Center

3-3 Capacity Development on O&M of Infrastructure and Service Delivery

1-5 Rusizi City Water Supply Network

1-6 Nyagatare City Water Supply Network

1-7 Musanze City Water Supply Network

1-8 Rubavu City Water Supply Network

1-9 Study for Future Investments

4-1 Program Audit

2-7 Provision of model latrines for schools

2-1 Kigali Centralized Sewerage System

2-5 Rusizi City (Faecal Sludge Treatment Plants and Landfill)

2-4 Rubavu City (Faecal Sludge Treatment Plants and Landfill)

2-3 Karongi City (Faecal Sludge Treatment Plants and Landfill)

Mid-term Review

Program Completion

1-1 Upgrading of Gihira WTP

Q4 Q3Q4 Q1 Q2 Q3Q3

Program Approval

2-2 Musanze City (Faecal Sludge Treatment Plants and Landfill)

4-3 Land Compensation

4-2 Program Operation

First Disbursment

1-10 Upgrade of Nzove WTP (Kigali)

Q4Q2Q1 Q3 Q4

2021

Q1 Q2

1-4 Huye City Water Supply Network

1-3 Muhanga City Water Supply Network

1-2 Kigali City Water Supply Network

Advance Procurment Activities

Activity

Loans/Grants Signature

Loans/Grants Effectiveness

20202019

Q4 Q1 Q2 Q3

2017 2018

1

REPORT AND RECOMMENDATION OF THE MANAGEMENT OF THE AFDB GROUP TO THE BOARD

OF DIRECTORS ON THE PROPOSED ADB AND AGTF LOANS TO THE GOVERNMENT OF THE

REPUBLIC OF RWANDA FOR THE RWANDA SUSTAINABLE WATER AND SANITATION PROGRAM

Management submits the following report and recommendation on the proposed ADB loan of

USD 121.137 million (UA 87.508 million) and AGTF loan of USD 50.000 million (UA 36.119

million) to finance the Rwanda Sustainable Water Supply and Sanitation Program.

I STRATEGIC THRUST & RATIONALE

1.1 Program Linkages with Country Strategy and Objectives

1.1.1 Agriculture is one of two key growth engines for Rwanda with coffee and tea being the

main cash crops for export. The agricultural sector, has over the last few years grown at an average

rate of 4.9%, contributing about 34.6% to the overall Gross Domestic Product (GDP). The sector

employs 79.5 % of the labor force and generates more than 45.0 % of the country’s export

revenues. The services sector, is currently the second growth engine and is marginally surpassing

agriculture as the main contributor to GDP. With water and economic growth being inextricably

linked and water being key to economic and social development, increased access to reliable and

sustainable water supply is expected to facilitate growth in both agriculture and industry, in

addition to others sectors, resulting in further economic growth and transformation. Sustainable

access to safe water and sanitation are also critical to the development of a climate resilient

economy.

1.1.2 The Government of the Republic of Rwanda (GoR) has shown consistent commitment to

sector reforms and economic transformation, pursuant to its Vision 2020, which accords high

priority to the development of infrastructure services in order to sustain resilient development and

achieve middle income status. The envisaged economic transformation needs to be accelerated by

addressing the high costs of doing business due to inadequate infrastructure; notably energy,

transport, water and sanitation which are major constraints to further growth in private investment.

The Vision has been converted into a series of medium-term strategic plans, the Economic

Development and Poverty Reduction Strategy (EDPRS). The second EDPRS, 2013-2018, is

currently in force establishing the emerging priorities built around four (4) thematic areas to

accelerate growth and eradicate poverty: Economic transformation, Rural development,

Productivity and youth employment, and Accountable governance. The EDPRS II aims to achieve

the following goals by 2018: raise GDP per capita to $1,000; have less than 30% of the population

below the poverty line; and have less than 9% of the population living in extreme poverty.

1.1.3 With inadequate infrastructure continuing to be a major cause of the high cost of doing

business and subduing private business activities and further economic transformation, the EDPRS

II identifies increased investments in infrastructure, especially transport, energy and water, as a

key vehicle to achieving economic transformation. The Bank’s 2014 Growth Diagnostics Study

confirmed the EDPRS II’s emphasis on the need to scale up infrastructure investments so as to

reduce the cost of doing business and to increase value addition in agriculture, industry, and service

sectors. The Vision 2020 envisions scaling up investments in reliable, affordable and

environmentally sustainable infrastructure and services. Water and sanitation services are defined

as key drivers and enablers for economic transformation and rural development. Accordingly,

EDPRS II has targeted to increase access to improved water supply and sanitation to 100%.

1.2 Rationale for Bank’s Involvement

1.2.1 Despite the remarkable achievements in water and sanitation sector, the current population

using potable water and improved sanitation facilities stands at 72.3% (90.4% urban, 68.7% rural)

and 58.3% (49.5% Urban, 60.0% rural) of respectively (Rwanda Demographic Health Survey-

RDHS 2014 -15), which require concerted effort to achieve universal coverage. With the country’s

2

population density already high and with the rate of urbanization growing at 4.8%, there is

increased need for reliable water supply and sanitation service in addition to improving the

management of water sources. Moreover, water resources are deteriorating as a result of poorly

managed wastewater runoff. To better mitigate these negative effects of urbanization and to

promote sustainable cities as driver of growth, the government is promoting development of key

infrastructure in Kigali and the satellite cities.

1.2.2 This program fits within the pillar 1 of the Bank’s Country Strategy Paper (CSP) 2017–

2021, “Investing in energy and water infrastructure to enable inclusive and green growth” and

directly contributes to the outcome: “increased access to affordable and reliable energy and water

supply and sanitation”. By providing sustainable and affordable water and sanitation services, the

program will lay foundations for industrialization and food security, enhance the sources of

economic and social resilience, and contribute to improved quality of life for the people which are

in line with the five (5) priority areas of focus (High-5s) geared to advance Africa’s transformative

agenda and to deliver the outcomes of the Bank’s Strategy for 2013-2022. The program will also

directly support Rwanda to achieve the Sustainable Development Goal (SDG) 6, “Ensure access

to water and sanitation for all”.

1.2.3 The program is in line with the Bank’s Integrated Water Resource Management Policy

(2000) and the Bank’s Strategy for 2013-2022 which recognizes development and management of

water as central to Africa’s sustainable growth. The program also supports the Urban Development

Strategy (2011) through providing strategic infrastructure for economic growth. The program’s

support to provision of improved water and sanitation services and capacity building with focus

on women and youth are aligned to Pillars II and III of the Bank’s Gender Strategy (2014-2018)

and Bank Group Strategy for Jobs for Youth in Africa (2016-2025). In line with the Bank’s

Knowledge Management Strategy (2015-2020), lessons from this intervention will help improve

the quality of the Bank’s involvements in urban water and sanitation sub-sector. The program also

is consistent with the Bank’s second Climate Change Action Plan which aims to help regional

member countries (RMCs) implement their Nationally Determined Contribution and promote

adaptation and mitigation actions, deploy climate finance and help to create an enabling

environment in which economic development can proceed in a low carbon climate resilient

manner.

1.2.4 The Bank has since 1974 been a key development partner (DP) in supporting the GoR to

address water and sanitation needs and continues to collaborate with the GoR in line with its

priorities as articulated in the EDPRS II, the Water Sector Strategic Plan (2013-18), the GoR’s

Seven Year Development Plan (2010-2017), the National Sanitation Policy and Strategy 2016, the

National Water Supply Policy and Strategy 2016 and the corresponding legislative instruments1.

In the past years, the Bank’s support has contributed to Rwanda’s achievement of the MDGs

related to water and sanitation as well as reduction of the under-five mortality rate, infant mortality

rate and the population below the extreme poverty line, which are currently at 50/1000, 32/1000

and 16.3% respectively.

1.3 Development Partner Coordination

1.3.1 An elaborate GoR/DPs’ coordination architecture supports the implementation of the

EDPRS II, anchored by an agreed dialogue structure. The highest level of the structure is the

Development Partners Coordination Group (DPCG) which is supported by 16 sector working

groups (SWGs). In addition, through memorandum of understandings (MOUs) between relevant

ministries and the Rwanda Development Board (RDB), DPs ensures linkages with districts to

identify areas of possible intervention and cooperation. Under the DPCG, the Bank through its

country office (CORW), plays an active role in policy dialogue and fully participates in the

1 Cabinet Decision 9th Dec 2016; Organic law No 04/2005 Modalities of Protection Conservation and Promotion of Environment – Rwanda.

3

preparation, monitoring and evaluation of national frameworks such as the EDPRS II. A donor

division of labor framework has been adopted to enhance alignment with the EDPRS II priorities,

and confines DPs’ support to three core sectors in line with a particular DP’s track record, mandate,

and expertise.

1.3.2 In May 2015, an assessment of SWGs’ operation in Rwanda was conducted at the request

of the Ministry of Finance and Economic Planning (MINECOFIN) and the Development Partners

(DPs) to review the performance of the SWGs to identify best practices, lessons learned, and to

make practicable, implementable recommendations which would enhance the contribution that the

SWGs make to EDPRS II implementation, and bring added value to all stakeholders. This

assessment has contributed to the revision of the terms of references for SWGs in order to improve

their performance by providing clarity as to: their objectives, expectations and standards.

1.3.3 The Water and Sanitation SWG meets at least quarterly. The Water and Sanitation SWG

secretariat, which is housed under the Ministry of Infrastructure (MININFRA) currently interacts

on a daily basis. The DPs active in the water sector currently include: the Japan International

Cooperation Agency (JICA), Swiss Agency for Development and Cooperation (SDC), United

Nations Children’s Fund (UNICEF), Water For People, WaterAid, Living Water International,

Movement for the Fight Against Hunger in the World (MLFM) and the AfDB in addition to other

smaller non-governmental organizations (NGOs). The GoR has, in collaboration with DPs,

harmonized sector procedures, including use of standard software for monitoring and evaluation

of national programs.

Table 1: Summary of the Sector Financing

Sector or subsector Size

GDP Budget Labor Force Water and Sanitation NA 1.5% NA

Players – Water and Sanitation Public Annual Expenditure (financial year: 2016/2017)

Government DPs RWF

Billion 20.8 9.3

% 69.1% 30.9%

Level of Donor Coordination Existence of Thematic Working Groups Y Existence of SWAps or Integrated Sector Approaches Y AfDB's Involvement in DPs coordination Y

II PROGRAM DESCRIPTION

2.1 Program Objective

2.1.1 The development objective of the program is to improve the quality of life and socio-

economic development of the people and country by ensuring equitable provision of adequate,

reliable and sustainable water and sanitation services for targeted cities.

2.2 Program Components

2.2.1 The program will comprise of four (4) main components shown below.

Table 2: Program Components Component & Outputs Est. cost(million USD)

1. Water Supply Infrastructure and Services Improvement 1-1 Rehabilitation, upgrading and extension of water supply network in Kigali City

and of the peri-urban areas including forwarding infrastructure for Kanzenze water treatment plant

1-2 Construction and upgrading of Nzove Water Treatment Plant with additional 55,000 m3/day for Kigali City*

122.763

JICA 21.53% Water For People 16.15% UNICEF 11.4% AfDB 10.89% WaterAid 7.04% SDC 2.4% Others 30.59%

4

Component & Outputs Est. cost(million USD)

1-3 Construction of Gihira II Water Treatment Plant Capacity 15,000 m3/day and Rehabilitation of existing Gihira Water Treatment Plant capacity 8,000 m3/day

1-4 Rehabilitation and extension of water supply distribution networks in the 6 Satellite cities of Musanze, Rubavu, Muhanga, Nyagatare, Huye and Rusizi.

1-5 Studies for future investments (Muhanga, Karongi and Ngoma water treatment plants)

2. Sanitation Infrastructure and Services Improvement 2-1 Rehabilitation and upgrading of semi-centralized sewerage systems in Kigali

estates including related studies 2-2 Construction of Kigali centralized sewerage system and installation of sewers

to the existing buildings in the areas concerned** 2-3 Construction of 4 Faecal Sludge Treatment Plants and 4 modern Solid Waste

Management Landfills in the Satellite Cities of Rusizi, Karongi, Musanze and Rubavu

2-4 Provision of latrines for schools

98.455

3. Institutional Support 3-1 Capacity development on O&M of infrastructure and service delivery 3-2 Construction of water & wastewater testing central laboratories and training

center for WASAC including related studies

4.610

4. Program Management 4-1 Program management support (audit, operating expenses etc.) 4-2 Land Compensation*

10.967

Total Base Cost 236.796 Contingencies 25.523

Total Cost 262.318 * Activities to be financed by the government, **activity to be co-financed with EIB

2.3 Technical Solution Retained and Other Alternatives

2.3.1 Technical solutions retained are based on studies conducted for each sub-project, taking

into account available water resources, sanitation services, socio-economic status of each town,

appropriate technology and capital and operational costs. Capacity development of Water &

Sanitation Corporation Limited (WASAC) is an integral part of the program for efficient delivery

of water and sanitation services and sustainability of the investments.

2.3.2 Alternative options explored and reason for rejection are summarized in the table below.

Table 3: Analysis of the Alternatives Considered Alternative Brief Description Selected Option / Reasons for Rejection

Provision of sewerage systems in all target cities

Uniformly providing sewerage infrastructure in all cities.

Due to high O&M cost of the sewerage system, they will be introduced only in business center districts in the City of Kigali where the option could be economically justified and continuous use of on-site sanitation is likely to pose health and environmental threats. With the hilly terrain in Rwanda, the site for the wastewater treatment plant was selected taking into consideration the need to minimize pumping. For other areas, on-site sanitation will continue to be the most viable option, and the program will provide exhausters and also construct faecal sludge treatment plants.

Water supply intervention without sanitation services

Investment for water supply infrastructure only with no provision for sanitation.

The program will provide both water supply and sanitation infrastructure, though it is financially more viable just supporting water supply. This option was rejected to ensure environmental and social sustainability. Sanitation infrastructure will be supported under the program in

cities where water will be provided under the program or where

water is already available through completed/ ongoing projects. The program will also support semi-centralized sewerage system in different estates in the City of Kigali.

5

Use of: 1) Anaerobic digestion; and 2) Thermal dryer for faecal treatment plant

1) Anaerobic digestion with biogas use 2) technology to dry the sludge more rapidly

Solar sludge drying technology was adopted for following reasons: 1) Faecal sludge originates mainly from septic tanks, which are emptied, in many cases, at intervals of one or more years, hence, has already undergone substantial biochemical degradation. 2) Thermal dryer will require additional energy, which will result in high operation cost and potentially increased greenhouse gas emissions.

2.4 Program Type

2.4.1 The proposed program supports infrastructure investments as well as institutional capacity

development. The program involves multiple water supply and sanitation sub-projects or

interventions to be implemented in the City of Kigali and in the satellite cities of Rubavu, Rusizi,

Nyagatare, Muhanga, Huye, Musanze and Karongi. The funding instrument for the proposed

intervention is sector investment. The program complements with the projects/programs funded

by other donors and the government, as stipulated in the division of labor agreed between the

government and the development partners, and focuses on the urban water and sanitation sub-

sector to promote development in the identified key satellite cities and in the city of Kigali.

2.5 Program Cost and Financing Arrangements

2.5.1 The total cost of the program for the components, defined in 2.2 above, is estimated at USD

262.318 million, net of taxes and duties. Of this, USD 186.092 million or 70.94% is in foreign

currency and USD 76.227 million is in local currency. The tables below provide the summary of

the program costs.

Table 4: Program Cost Estimates by Component

Component

million USD million UA Foreign

Currency %

% Total Foreign

Currency Cost

Local Currency

Cost Total

Foreign Currency

Cost

Local Currency

Cost Total

1. Water Supply Infrastructure and Services Improvement

95.053 41.284 136.337 68.664 29.823 98.487 69.72% 51.97%

2. Sanitation Infrastructure and Services Improvement

86.591 23.114 109.705 62.552 16.697 79.249 78.93% 41.82%

3. Institutional Support 3.991 0.987 4.978 2.883 0.713 3.596 80.17% 1.90%

4. Program Management 0.703 10.595 11.298 0.508 7.654 8.162 6.22% 4.31%

Total 186.338 75.980 262.318 134.607 54.887 189.494 71.03% 100.00%

Table 5: Sources of Financing

Source

million USD million UA

% Foreign

Currency Cost

Local Currency

Cost Total

Foreign Currency

Cost

Local Currency

Cost Total

ADB 85.964 35.173 121.137 62.099 25.409 87.508 46.18%

AGTF 39.442 10.558 50.000 28.492 7.627 36.119 19.06%

EIB 39.291 11.203 50.494 28.383 8.093 36.476 19.25%

GoR 21.641 19.046 40.687 15.633 13.758 29.391 15.51%

Total 186.338 75.980 262.318 134.607 54.887 189.494 100.00%

6

Table 6: Program Cost by Category of Expenditure

Category of Expenditure

million USD million UA %

Foreign Foreign

Currency Cost

Local Currency

Cost Total

Foreign Currency

Cost

Local Currency

Cost Total

A. Works 166.633 65.385 232.018 120.373 47.233 167.606 71.82%

B. Services 16.471 – 16.471 11.898 – 11.898 100.00%

C. Goods 2.754 – 2.754 1.990 – 1.990 100.00%

D. Others 0.480 10.595 11.075 0.346 7.654 8.000 4.33%

Total 186.338 75.980 262.318 134.607 54.887 189.494 71.03%

Table 7: Expenditure by Component and Source in million USD Component ADB AGTF EIB GoR Total

1. Water Supply Infrastructure and Services Improvement

56.040 (40.482)

50.000 (36.119)

– 30.297

(21.886) 136.337 (98.487)

2. Sanitation Infrastructure and Services Improvement

59.211 (42.773)

– 50.494

(36.476) –

109.705 (79.249)

3. Institutional Support 4.978

(3.596) – – –

4.978 (3.596)

4. Program Management 0.908

(0.657) – –

10.390 (7.505)

11.298 (8.162)

Total 121.137 (87.508)

50.000 (36.119)

50.494 (36.476)

40.687 (29.391)

262.318 (189.494)

( ) is in million UA

Table 8: Category of Expenditure by Funding Source in million USD Category of Expenditure

ADB AGTF EIB GoR Total

A. Works 104.270 (75.323)

49.522 (35.774)

49.372 (35.665)

28.854 (20.844)

232.018 (167.606)

B. Services 14.550

(10.511) 0.478

(0.345) –

1.443 (1.042)

16.471 (11.898)

C. Goods 1.632

(1.179) –

1.122 (0.811)

– 2.754

(1.989)

D. Others 0.685

(0.495) – –

10.390 (7.505)

11.075 (8.000)

Total 121.137 (87.508)

50.000 (36.119)

50.494 (36.476)

40.687 (29.391)

262.318 (189.494)

( ) is in million UA

Table 9: Expenditure Schedule by Component in million USD Component 2018 2019 2020 2021 Total

1. Water Supply Infrastructure and Services Improvement

51.325 (37.076)

42.056 (30.380)

31.830 (22.994)

11.126 (8.037)

136.337 (98.487)

2. Sanitation Infrastructure and Services Improvement

1.482 (1.070)

35.512 (25.654)

37.198 (26.871)

35.513 (25.654)

109.705 (79.249)

3. Institutional Support 0.318

(0.230) 2.174

(1.570) 2.066

(1.492) 0.420

(0.304) 4.978

(3.596)

4. Program Management 10.752 (7.767)

0.182 (0.132)

0.182 (0.132)

0.182 (0.131)

11.298 (8.162)

Total Costs 63.877

(46.143) 79.924

(57.736) 71.276

(51.489) 47.241

(34.126) 262.318

(189.494)

( ) is in million UA

2.6 Program’s Target Area and Population

2.6.1 The proposed overall program will be implemented in the City of Kigali and the satellite

cities of Rubavu, Rusizi, Nyagatare, Muhanga, Huye, Musanze and Karongi covering water supply

and sanitation sub-projects. The major beneficiaries are the population, business owners, small

scale agriculture and industries including processing of agriculture products within the respective

target cities who will benefit from improved service delivery and reliable access to water and

sanitation, as well as WASAC, districts and private operators who will benefit from capacity

development activities.

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2.6.2 Over this program, about 1.1 million people will be provided with improved water supply

services and 475,000 people will have access to improved sanitation services. The program

benefits include: (a) improved reliability and sustainability of the water supply and sanitation

services; (b) overall improvement of the public health situation in the target cities and their

surrounding areas, as a result of more reliable improved water supply and improved sanitation

services, and (c) an improved operation & maintenance (O&M) capacity of WASAC.

2.7 Participatory Process for Program Identification, Design and Implementation

2.7.1 The program has benefited from a participatory approach at the various stages:

identification, program design, preparation and appraisal. The program development process

entailed extensive consultations with relevant stakeholders including the district administrations,

local authorities, civil society organizations (CSOs) and the beneficiaries with diverse social

backgrounds. Discussions with communities were voluntary, gender inclusive and touched on

challenges with current service, current applicable technologies, current rates of access, and levels

of disease burden, relevant interventions, roles, capacities and gaps of the various stakeholders.

The community meetings highlighted concerns on the benefits and possible impacts of the

program, utilization of funds and community involvement in program activities. It was noted that

the selection of sites and infrastructure was in agreement with the desires of the beneficiaries who

also indicated their willingness to fully participate in all program activities during implementation.

All stakeholders acknowledged that inadequate water supply and sanitation is affecting their social

wellbeing, posing serious risks to public health and livelihoods of the people in Kigali and the

satellite cities.

2.7.2 Stakeholder participation in program was further achieved through environmental and

social impact assessments (ESIAs) and resettlement action plan (RAP) preparation process, during

which communities were given detailed information about the sub-projects through presentations

by consultant teams. The presentations highlighted the sub-project background, objectives as well

as potential socio-economic and environmental impacts with feedback and expectations received

from those present. It is intended that the participatory approach shall be adopted throughout the

program implementation in line with the Bank’s consultation and stakeholder engagement

guidance notes as contained in the guidance available in the Integrated Safeguards System (ISS).

It was also agreed to adopt the Stakeholder Engagement Plan (SEP) which was prepared for the

Kigali Centralized Sewerage System component for the entire program.

2.8 Bank Group Experience, Lessons Reflected in Program Design

2.8.1 As of September 2017, the Bank’s portfolio in the country comprises of 17 active

operations. These included 16 sovereign loans and grants and one (1) private sector operations

amounting to a total commitment of UA 396.62 million. The Bank’s portfolio distribution by

sector shows that infrastructure (energy, transport and water) accounts for 79% of the total

commitments, followed by multisector 10%; human development 6%, and private sector 5%. The

Rwanda 2011-2016 CSP & Country Portfolio Performance Review (CPPR) Completion Report

(2016) clearly demonstrated that the portfolio performance has improved from an overall rating of

2.55 (on a scale of 0-3) in 2015 to 3.4 (on a scale of 1-4) in 2016. All the implementation progress

reports (IPRs) are up to date. There is no outstanding Project Completion Report (PCR) and

conditions precedent to first disbursement for all previously approved sovereign operations in the

sector have been fulfilled. Bank’s assistance in the water and sanitation sector in Rwanda has,

since 1994 to date, focused, mainly on the rural sub-sector, and a total of five (5) operations have

been financed. As at September 2017, cumulative disbursements reached UA 158.1 million which

corresponds to disbursement rate of 40%.

8

2.8.2 Some of the key lessons learnt from on-going and past interventions in the country by the

Bank and other DPs are taken into account in the design of the program. The main lessons taken

into account are:

Timely compensation: To avoiding delays in compensating program affected persons, the

GoR will compensate all project affected persons (PAPs) in timely manner as agreed during

the March 2016 CPPR. Phased compensation approach was successfully applied for the

Base-Rukomo Road Project financed by the Bank.

Speeding up program start-up activities: To ensure timely implementation of the program

and comply with the Bank’s Presidential Directive (PD) 02/2105, sub-projects were selected

based on the readiness of studies including ESIA among other criteria. For the sub-projects

that are still at preliminary design stage, design and build method of implementation will be

introduced to commence works in the shortest possible period. Advance procurement

activities for the recruitment of supervision consultancies and procurement of contractors

commenced in August 2017 ahead of approval of the program by the Bank’s Board.

Streamlined implementation: For the effective implementation of projects, WASAC has

established a unit, the Single Project Implementation Unit (SPIU), dedicated for

infrastructure development. The SPIU will be responsible for the implementation of all

investment projects/programs financed by the government and developing partners with a

flexibility to augment its staffing depending on the needs.

Inclusive service delivery: To ensure service provision to low income households and

marginalized groups, WASAC has a pro-poor mechanism in place to support individual

water supply connections to the distribution network. This is an integral part of the program

and will facilitate more access to the services.

2.9 Key Performance Indicators

2.9.1 The program will be monitored using Key Performance Indicators (KPIs) reflected in the

program’s results based logical framework (RBLF) which also include the indicators defined in

Bank’s Results Measurement Framework 2016-2025. Reflecting the objective of the program,

indicators at impact level will measure improvement in access to safely managed water supply and

sanitation services, reduction in poverty and diarrhea incidents at national level. Outcome

indicators include those that will capture improved services level and job opportunities created by

the program. Output indicators were identified to capture progress of key activities under the

program, such as progress in construction and rehabilitation of water supply networks,

construction of faecal sludge treatment plants and solid waste landfills and capacity development

activities. To ensure adequate inclusion of gender issues, gender-segregated data will be collected

where appropriate.

III PROGRAM FEASIBILITY

3.1 Economic and Financial Performance

Table 10: Key Economic and Financial Figures FIRR 15.42% and FNPV RWF 73,369 million (at 10% base case) EIRR 22.82% and ENPV RWF 164,882 million (at 10% base case)

FIRR: Financial Internal Rate of Return, FNPV: Financial Net Present Value

EIRR: Economic Internal Rate of Return, ENPV: Economic Net Present Value

3.1.1 The financial and economic analysis has taken into account the assumptions contained in

the subsequent paragraphs.

9

3.1.2 The program will be implemented over an estimated 4 year period and will have a life span

of 20 years from completion of implementation in 2021.

3.1.3 The estimated target population for access to water supply under the program on

completion of interventions is projected to be 1.1 million people. Service assumptions are that,

30%, 50%, 60%, 80% and 100% of that target population will start to benefit from the program in

2018, 2019, 2020, 2021 and 2022 respectively.

3.1.4 The prevailing water tariff as approved by the Rwanda Utilities Regulatory Authority

(RURA) was adopted for this analysis, with the assumption that regular reviews will be undertaken

in order to reflect the cost of service provision. The analysis assumes a gradual progression from

O&M cost recovery, subsequently reaching full cost recovery to cover investments.

3.1.5 The country currently does not have a tariff for sewerage or wastewater treatment, and with

the planned construction of wastewater treatment plants under this program, it is anticipated that

the RURA will start the process of domesticating a tariff for wastewater treatment.

3.1.6 Operating and maintenance costs, including administration overheads, are estimated to be

65% of the revenue generated (in line with RURA’s target of ensuring affordable cost recovery

tariff), a significant improvement on the current performance of WASAC where cost of sales and

administration costs currently consume approximately 100% of the revenue. WASAC currently

relies on subsidies and grant from the GoR to enable it to cover other costs, including provision

for depreciation.

3.1.7 The EIRR considers the incremental benefits arising from reduction in health costs due to

reduction in waterborne infections. It also considers the time saving benefit, as women and

children spend less time fetching water. This will lead to an increase in their focus on other income

generating activities, thus improving the livelihoods of the communities. It will also contribute to

the ease of doing business, as enterprises will be attracted to set up shop in the satellite towns, thus

creating employment and reducing migration to the capital city.

3.1.8 Sensitivity analysis was undertaken to assess the impact on the FIRR and EIRR of increases

in the capital costs and tariff reductions, and concluded that the reductions in tariffs, have a more

accelerated impact on the viability program than the measured increases in capital costs. This goes

to buttress the recommendation to the RURA to ensure regular cost recovery tariff reviews in order

to enhance the financial health of the utility which leads to sustainability. The sensitivity analysis’

conclusion is that both increases in capital costs and reductions in tariffs of up to 20% will not

result in the interventions becoming unviable.

3.2 Environmental and Social Impacts

3.2.1 To enhance environmental performance of the program, the Rwanda Organic Law No.

04/2005 of 08/04/2005 on protection, conservation and management of the environment and

regulation on the conduct of environmental impact assessments (EIAs) as well as the ISS and

Environmental and Social Assessment Procedures (ESAP) have been applied with the overall

objective of ensuring environmentally sustainable development and delivery of the program for

improved quality of life. In accordance with the ISS, the Bank categorized this program as a

Category 1 due to the nature of its impacts spread out in a geographically wide catchment in the

different beneficiary towns, as well as the large number of PAPs impacted by the entire program,

estimated at over one thousand. In line with the ISS, ESIAs were carried out for each of the

beneficiary towns and Resettlement Action Plans prepared for the components involving

involuntary resettlement. The individual ESIA reports for the beneficiary towns have all been

cleared at country level by the Rwanda Development Board (RDB), confirming that the program

has complied with country EIA requirements and procedures. The ESIA and RAP summaries were

prepared, reviewed and disclosed on the AfDB’s website on 23 June 2017.

10

3.2.2 The positive impacts expected from the project include: better access to safe drinking water

and sanitation facilities leading to improved standard of living in terms of reduction of diseases,

access to basic services as well as creation of temporary employment during construction. The

landfill and faecal sludge components will contribute to alleviating the impacts of the existing

open dumping and uncontrolled solid waste disposal into the environment, which include nuisance

odors, poor aesthetics and risk of ground water pollution, among others.

3.2.3 The project’s envisaged negative impacts during construction include: possible damage to

other service infrastructure and public service utilities such as telecommunications, damage to road

pavements, sedimentation of stormwater drainage and watercourses due to erosion of loosened

soils during earth works; traffic interruption and occupational health and safety risks during

construction. Negative impacts identified for the operation phase include possible water pollution

due to discharge of effluent from water treatment plants as well as leachate from solid waste and

faecal sludge treatment facilities; occupational health and safety risks especially for operators of

solid waste and faecal sludge plants; health problems and nuisance from waste water flows or

leaks, dust and noise emissions from active work sites and excavations and related transportation

of materials.

3.2.4 To address the anticipated negative impacts, mitigation measures have been proposed and

will include: avoiding unnecessary crossings on important roads, exploring alternative routing of

pipelines as appropriate to minimize number of affected persons requiring compensation,

resurfacing and stabilizing exposed surfaces to minimize erosion; backfilling trenches as soon as

pipelines are laid; proper disposal of surplus soils and demolition materials; provision of personal

protection equipment to contractor staff and first aid kits; safe disposal of used oil, greases and

hazardous materials in line with national standards and designated areas that will not result in

pollution; minimal vegetation disturbance; control of stormwater run-off and soil erosion;

establishment of communication platforms for complaints and complaints management;

identification of high risk jobs and manage and mitigate against accidents and injuries to workers;

development of an emergency preparedness plan that includes communities where they are within

the vicinity of the work area. The program will also include public sensitization programs to

sensitize residents of the towns on matters regarding the urban environmental protection and public

health issues. To support this the SEP developed for the Kigali Centralized Sewerage System will

be adopted for the entire program. An Environmental and Social Management Plan (ESMP)

implementation budget has been estimated to cost RWF 682,092,452, plus an additional €

2,982,144 dedicated to the implementation of the ESMP for the Kigali City centralized sewerage

system.

Institutional Arrangements for ESMP Implementation

3.2.5 The executing agency, WASAC, has an established position for an Environmental Officer

and two (2) positions for Sociologists which will provide oversight on the implementation of the

environment (ESIA) and social (RAP) components of the program. It is further planned that

oversight on environmental issues will further be supplemented through recruitment of additional

environment expertise by the supervising consultant once the project commences. The RAP

implementation components will further be supported by the district and local institutional

structures such as District Land Bureaus and Sector/Cell Land Committees that will play a role in

facilitating the expropriation and compensation process.

3.2.6 In view of the fact that most of the program components, such as solid waste and faecal

sludge management components, are in themselves intended to deliver improved sanitation and

environmental outcomes, it is envisaged that the activities of the technical experts who will manage

these components under the SPIU structure will further provide added input on delivery of the

environmental outcomes under these respective components.

11

Climate Change

3.2.7 The program has been classified as Category 2 on Climate Risk in accordance with the

Bank’s Climate Safeguards System (CSS). Impacts such as reduced river flows due to drought

and/or flooding and erosion due to catchment degradation could undermine sustainability of water

supplies to the program both in terms of water quality and quantity. It is evident that the water

sources will increasingly be affected by siltation as a consequence of mainly agricultural activities

in the catchment areas. To address these challenges the Government has initiated an integrated

water resources management (IWRM) program that includes a catchment area management

covering some of the catchments from which the program will source its water supplies, such as

the Sebeya, Nyabugogo and Nyabarongo river catchments, and involving, among others, erosion

control through terracing and forest rehabilitation. It is projected that these interventions could go

a long way towards contributing to mitigating wider climate change related effects and land

degradation that could in the long run undermine river flows and water quality.

Social

3.2.8 The Value of 2015 Human Development Index of Rwanda is 0.498 (ranked 159 out of 188)

placing the country in the low human development range, as specified by the Human Development

Report 2016. Socio-economic status of target cities are diverse with poverty level of provinces

ranging from about 20% to 46%, i.e. Kigali City: 20.7%, Eastern Province (Nyagatare): 37.9%,

Southern Province (Muhanga and Huye): 38.4%, Western Province (Rubavu and Rusizi): 45.2%

and Northern Province (Musanze): 46.1%. This diversity in poverty levels in based, in part, on the

fact that the beneficiary communities range from fairly high income urban neighborhoods to low

income neighborhoods in peri-urban areas.

3.2.9 Access rate to improved water supply service in target cities including peri-urban range

from about 30% to 90%. Two (2) out of top five (5) causes or 26% of morbidity in child under

five (5) reported by health centers in Rwanda are water borne disease (diarrhea and skin infection),

which could be prevented with access to improved water and sanitation facilities. Kigali City and

the satellite cities are identified as growth poles for economic development by the Government. It

is an imperative to ensure conducive environment for business activities to flourish while coping

with problems associated with rapid urbanization.

3.2.10 The program will have a positive impact on the population, contribute to the SDGs beyond

those related directly to water and sanitation sector and the Bank’s High-5s. Benefits will include

decline in water-borne diseases and associated health care costs as well as creating reducing cost

of doing business which is expected to lead to job creation and sustainable economic development.

The program also intends to support employment opportunities for youth through enhanced

internship programs. The program will thus contribute to reducing poverty and improving the

quality of livelihoods of the populations.

Gender

3.2.11 The program interventions are informed by the socio-economic and gender analysis

conducted in Kigali and the satellite cities covered by the program. Women face severe difficulties

participating in various local and national development processes and programs, as in most

communities, fetching water is perceived as the traditional role for women and girls. Community

leaders reported that fetching water has in some way contributed to stopping school and early

marriage in parts of the districts though this is not entirely the solely cause of school drop-out, but

it does contribute largely to it. Women do the most pressing house chores: cooking, cleaning and

fetching water, as well as looking after the sick, the old and children. School lateness and

absenteeism as a result of fetching water was also cited. Further, the pregnant women are also

disadvantaged with distance as they get fatigued with the heavy loads of buckets. As the main

users of water, women have a greater incentive to keep water and sanitation facilities functioning;

12

thus justifying the need to involve the active participation of women in planning, management and

decision making of projects designed to deliver water and sanitation services in their communities.

The multiple roles of women play often subject them to crushing workloads leaving them with no

time for other activities, worse is their exclusion from decision-making in the development of

water and sanitation resources of their own communities. The program has ensured adequate

representation of women in water and sanitation committees, currently proposed to be at least 30%

of committee members.

3.2.12 In 2016, the district of Rubavu, reported a total of 4,921 primary school drop outs for both

boys and girls while 537 dropped out in secondary school. The survey for this intervention revealed

that fetching water from long distances has in a way contributed to both girls and boys to drop out

of school due to either poor performance leading to repeating classes or just being at home helping

with house chores and also as a major reason for school lateness and absenteeism. The program

will improve water supply and provide water closer to homes which will increase girls and boys

free time and boost their school attendance. The program will also address the lack of separate and

decent sanitation and washing facilities which normally discourages girls who are menstruating

from attending full time, often adding up to a significant proportion of school days missed.

Involuntary Resettlement

3.2.13 The program will affect over 2,000 persons, of which the Kigali City Centralized Sewerage

Treatment System alone is estimated to affect 1,230 people. A RAP has been prepared and

estimates of losses already prepared and to be further confirmed by a Government valuer. This

will pave the way to compensation according to the Bank Policy and national expropriation

procedures. However, contractors will be required to minimize need for compensation as much as

will practically be possible, for instance by following established roads and paths for ease of access

and maintenance.

IV IMPLEMENTATION

4.1 Implementation Arrangements

4.1.1 The borrower will be the Republic of Rwanda, through the MINECOFIN. In 2014, the

GoR unbundled the then Energy, Water & Sanitation Authority (EWSA), leading to the formation

of two entities, one focusing on energy (Rwanda Energy Group - REG) and another focusing on

water supply and sanitation (WASAC). Implementation of this program will be through WASAC,

a utility which carries out significant development activities including projects aimed at increasing

the capacity, expanding and maintaining water infrastructures, as well as developing the sanitation

infrastructures to ensure effective water and sanitation services. WASAC is a state owned

company, owned 100% by the GoR. The MINECOFIN will sign a subsidiary program

implementation agreement with WASAC, mandating them to implement the program on behalf of

the GoR. The signed agreement will be a condition precedent to first disbursement.

4.1.2 Recently, the GoR adopted the SPIU structure for implementation of projects/programs in

the country. The structure envisages the setting up of units within each state owned company or

sector, dedicated to implement projects/programs funded either through own GoR resources or by

donors.

4.1.3 In line with the GoR’s directive on the setting up of SPIUs, WASAC, on 10 February 2017,

approved a new WASAC structure, which incorporated the SPIU. This program will be

implemented through the SPIU, and the recruitment of staff for the SPIU is being undertaken and

will be concluded before the program is approved by the Bank. Staffing of the SPIU will include

Program Coordinator, two (2) Program Managers, a Resource Mobilization Officer, a Financial

Specialist, two (2) Accountants, two (2) Monitoring & Evaluation (M&E) Specialists, Water

Engineers and Sanitation Engineers and three (3) Procurement Specialist.

13

The new approved organizational structures for WASAC and the SPIU are contained in the

Technical Annexes.

Implementation Schedule

4.1.4 The program will be implemented over a period of 48 months following fulfilment of

conditions for first disbursement, expected before February 2018. Procurement processes of

various services have already commenced in August 2017, while most of works are scheduled to

commence in the third quarter of 2018. Program completion is set for December 2021 and the

deadline for last disbursement will be 30 June 2022.

Procurement Arrangements

4.1.5 Procurement of goods (including non-consultancy services), works and the acquisition of

consulting services, financed by the Bank for the project, will be carried out in accordance with

the “Procurement Policy for Bank Group Funded Operations”, dated October 2015 and following

the provisions stated in the Financing Agreement. Specifically, procurement would be carried out

following:

Borrower Procurement System (BPS): Specific procurement methods and procedures

(PMPs) under BPS comprising its Laws and Regulations of Public Procurement Law No.

12/2007 enacted in 2007 and revised in 2013. Rwanda Procurement Law is generally

consistent with international standards as it contains most elements of modern procurement

legal and regulatory framework. The Rwanda Public Procurement Authority (RPPA) revised

the national standard bidding documents and procurement manual to incorporate the

provisions of Law No.05/2013 of 13/02/2013 modifying and completing Law No. 12/2007 of

23/03/2007. The methods used under this provision shall include open competitive bidding

(OCB) with international, national publication, and shopping.

Bank Procurement Methods and Procedures (PMPs): Bank PMPs, using the relevant Bank

standard or model solicitation documents, for contracts that are either: (i) above the above-

captioned thresholds, or (ii) in case BPS is not relied upon for any category of procurement.

4.1.6 The assessment of procurement risks at the country, sector, and program levels and of

procurement capacity at the executing agency, were undertaken for the program and the outputs

have informed the decisions on the procurement regimes (BPS, Bank or Third party) being used

for specific transactions or groups of similar transactions under the program. The details of these

are available in B5 of the Technical Annex.

Financial Management and Disbursement Arrangements

4.1.7 The overall conclusion of the financial management risk assessment for the program is

moderate (detailed analysis shown in Technical Annex B3). WASAC has adequate financial

management system to record and report the resources of the Program. The Project Financial

Management Unit (PFMU) is responsible for the financial management of the program. The

PFMU will have project finance staff under the SPIU to handle the day-to-day financial

management of the program. The PFMU is in the process of filling its vacant positions. As per the

approved WASAC organizational structure, the SPIU will have one financial management

specialist and two accountants as permanent staff. In addition, it was agreed that a full time

accountant will be recruited on contractual basis for the program.

4.1.8 WASAC will submit quarterly progress reports within forty-five days after the end of each

quarter showing cash receipts by sources and expenditures by main expenditure classifications

together with physical progress reports linking financial information with physical progress and

highlighting issues that require attention. The program financial statements will be prepared within

three (3) months after the closure of every financial year and presented to the auditors. The

program audit will be conducted by the Office of the Auditor General (OAG) or by an independent

14

private auditor selected on competitive basis in consultation with OAG following the Bank’s audit

terms of reference. The audit report, complete with a management letter, will be submitted to the

Bank not later than six (6) months after the end of the financial year.

4.1.9 The program will have the options of using both the special account and the direct payment

methods of disbursement, which are detailed in the Bank’s Disbursement Handbook. The program

will operate one foreign special account into which the proceeds of the loan will be deposited and

further to a local currency account, if needed. The accounts will be opened in a bank acceptable to

the AfDB. The opening of a foreign currency special account will be a condition precedent to first

disbursement of the loan.

4.2 Monitoring and Evaluation

4.2.1 The program will be monitored using key KPIs at input, output, impact and outcome levels

reflected in the program’s results based log-frame. Overall responsibility for M&E will rest with

the SPIU of WASAC. WASAC will monitor all the activities including ESMP implementation

and prepare periodic reports including implementation progress, fiduciary status, stakeholder

participation, safeguards, risks and mitigation measures.

4.2.2 The SPIU will prepare the project quarterly progress reports. The SPIU Coordinator would

then avail these reports to the Bank. CORW will closely monitor day-to-day implementation of

the project. The Bank will carry out at least two supervision missions annually including financial

management and procurement assessments reviews. In addition, the Bank will also carry out a

mid-term review of the program and a program completion report will be prepared at the end of

the program. The implementation progress reports from these missions, which will render an

account on the achievement level on indicators, will be used to monitor the progress of the

program.

Table 11: Key Program Milestones

Timeframe Milestone Monitoring Process/feedback loop

Jul. 2017 Start of advance procurement of a consulting firms for supervision of works and contractors

Request for expression of interest published and draft tender document prepared

Nov. 2017 Program approval Program approved by the AfDB Board Dec. 2017 Signing Loan agreements signed Jan. 2018 Launching Launching workshop organized Feb. 2018 Effectiveness Loan agreements declared effective by the Bank Apr. 2018 Start of works Works contract signed Jan. 2020 Mid-term review Mid-term review undertaken Dec. 2021 Completion of program Program completion report

4.3 Governance

4.3.1 Rwanda has made substantial progress towards political stability and has outperformed its

peers in East African Community (EAC) on key governance indicators. The Bank’s 2016 Country

Policy and Institutional Assessment (CPIA) average overall rating for Rwanda is 4.87 out of 6

which is the highest in Africa. Rwanda’s Real GDP growth was estimated at 6.9% in 2015, driven

by the services and industrial sectors. The country has made great strides in improving the business

regulatory environment. It is the second most overall consistent reformer globally and ranks

second in Africa on the ease of doing business, based on the global “Doing Business 2017” report.

Furthermore, Rwanda achieved all the Millennium Development Goals (MDGs) at goal level -

except two (39.1% - below national poverty line; 38% percent of under-five stunted) - and has

made strong progress in promoting gender equality being ranked 5th out 144 countries in gender

gap index as per the Global Gender Gap Report (2016). Nevertheless, Rwanda faces a number of

challenges in order to achieve its medium and long term development aspirations, mainly due to

15

the high rate of poverty and inequality, rapid demographic growth, unemployment (especially

amongst young people) and constraints in private sector development.

4.3.2 Rwanda remains one of the steady climbers in overall governance ratings. The country

ranks 11th in Africa and is one of the continent’s top ten improvers in overall governance since

2011. The country’s overall governance performance has improved year-on-year since 2011,

reaching its highest ever score in 2014. This trend has been driven by gains in all four categories

of the Ibrahim Index of African Governance (IIAG), where the country continues to outperform a

number of peers. The country seats among Africa’s top ten improvers with regards to Safety &

Rule of Law, Sustainable Economic Opportunity and Human Development. The country’s greatest

gains have been within Human Development, underpinned by improvements in each of the three

(3) sub-categories, Welfare, Education and Health.

4.3.3 Access to safe and clean water continues to play a vital role in social and economic

development, poverty reduction and public health. In order to deliver on the sector goals, in 2014,

the GoR unbundled the then EWSA, leading to the formation of two entities, one focusing on

energy (REG) and another focusing on water supply and sanitation (WASAC). The water supply

arm of the EWSA was benefiting from cross subsidies from the more profitable energy arm. The

unbundling has put into focus the need to ensure cost recovery tariffs are charged for the

sustainability of the sector.

4.3.4 WASAC is a state owned company that distributes water in Rwanda. The company, which

arose out of the unbundling of the then EWSA, falls directly under the MININFRA which supports

districts in the construction of water supply systems, latrines and hygiene promotion. The other

ministries with a stake in the water sector are (i) Ministry of Natural Resources (Lands, Forests,

Environment and Mining) (MINIRENA) which ensures sustainable management and rational use

of natural resources, including water. It is in charge of monitoring drinking water quality and

promoting user awareness; and (ii) Ministry of Local Government (Good Governance, Community

Development and Social Affairs) (MINALOC) which is in charge of accompanying local

participatory planning processes, applying the government's Community Development Policy and

putting in place democratic, decentralized administrative structures, which are able to mobilize the

population in order to implement Government programs and resolve problems. WASAC has a

Board of Directors that brings together eight skilled professionals to provide strategic direction to

the operations of the utility.

4.3.5 The National Water Supply Implementation Strategy 2016 is one of the key strategic

documents that drive the water sector. The RURA continues to regulate the utilities, ensuring fair

and equitable tariffs are levied for basic services provided. The RURA remains an integral part of

the sector and, with support from the GoR and donors, will continue to execute its mandate to

regulate the provision of water services in a way that promotes fair competition, sustainable and

efficient use of water resources and to ensure that water service providers offer a good quality of

service in regards to drinking water.

4.4 Sustainability

4.4.1 WASAC will be responsible for both implementation of the program and operation and

maintenance of the infrastructure. For financial and operational sustainability of the interventions,

the program will support WASAC to build their capacities through training and provision of

equipment to support improvements in management of non-revenue water (NRW), which will

result in improvements in the financial health of WASAC, enabling them to reinvest in

improvements and increasing water connections. The company has continued to post losses,

arising from high electricity charges, significant depreciation charge on property and equipment,

and the historical low tariffs inherited from the EWSA.

16

4.4.2 Furthermore, the regulation of the sector is of paramount importance to sustainability, and

the RURA continues to receive support from various donors to build their capacities to efficiently

regulate the sectors. Currently the RURA is being supported by donors to undertake more robust

tariff studies, setting up a data management system and putting in place a monitoring and

information system (MIS) in the country. This will contribute towards enhancing the capacity of

the RURA to deliver on its mandate in the water supply subsector to ‘regulate the provision of

water services in a way that promotes fair competition, sustainable and efficient use of water

resources and to ensure that water service providers offer a good quality of service in regards to

drinking water’. This is achieved through approval of tariffs, issuance of licenses for the provision

of water services; monitoring quality of services, handling customer complaints and dispute

resolution, among others. In addition, ‘the authority also ensures that the sanitation sub-sector is

effectively promoted through regulation of sanitation services. Sanitation regulation consists of

establishing regulatory tools necessary for the sound regulation of sanitation services in Rwanda,

licensing sanitation service provision, monitoring compliance by licensees with license terms and

conditions through audits and inspections conducted to sanitation service providers and analyze

reports from sanitation service providers.’

4.4.3 The setting of affordable and cost recovery tariffs is at the heart of the sustainability of

WASAC and the sector. The current tariff in use, which does not cover full cost recovery, was

approved by the RURA on 1 September 2015. WASAC is currently preparing a new review, with

support from the UN-Habitat, for submission to the RURA for review and approval. This

continued support to WASAC will contribute towards ensuring financial and institutional

sustainability of the utilities and water companies. The annual review of tariffs will graduate the

tariff first to O&M recovery, reaching full cost recovery in future. In addition, the country will

need to adopt a waste water treatment tariff since this project include construction of waste water

treatment plants in Kigali and in the satellite towns.

4.5 Risk Management

4.5.1 Table 12 presents the main risks and mitigation measures.

Table 12: Risks and Mitigation Measures

Risk Probability/

Impact Mitigation measures

Delays in program implementation

Low/ High

Procurement for key activities has commenced already to start the implementation as soon as the project is effective. Procurement modalities have been defined based on the readiness of the studies and design and build contractors will be procured where appropriate.

Cost recovery limitations and inability to sustain the systems

Low/ Medium

WASAC is currently preparing a tariff review with support from UN-Habitat for submission to RURA for approval. Continual review of the tariffs in order to attain the long term full cost recovery will be required, and the RURA is committed to support the sector’s sustainability.

Limited skills to operate and maintain sewerage system

Medium/ High

Construction of Kigali Centralized Sewerage System will entail two (2) year technical support by the contractor to build the capacity of WASAC to operate and maintain the system, which is the first water-borne centralized sewerage in the country.

The resettlements and compensation not being handled timely or properly

Medium/ High

The risk is mitigated by the fact that consultations have already started involving stakeholders and district governments. Moreover, awareness exercises directed at the identified PAPs of the sub-projects and sensitization are ongoing as part of the RAP preparation process.

17

4.6 Knowledge Building

4.6.1 The program will generate critical knowledge for the performance of the water and

sanitation sector in the country, which will build up lessons for the design and management of

similar interventions, to be adapted for replication throughout the country as well as in other

RMCs. The IPR, quarterly progress reports, audit, and completion reports will also provide

information on various aspects of the program for further diagnosis. Given that the program covers

strategic cities in wide geographic areas, there is potential to generate useful lessons. In line with

Knowledge Management Strategy 2015-2020, the knowledge obtained will be captured through

regular supervision, progress reporting and mid-term review, and as part of PCR preparation

process, documented and shared within the Bank and with other DPs and RMCs.

4.6.2 Through the implementation of the program, WASAC will learn the Bank’s procedures

and safeguards which they will be able to replicate the same in its future development work.

V LEGAL INSTRUMENTS AND AUTHORITY

5.1 Legal Instrument

5.1.1 The program will be financed by ADB loan and AGTF loan. Hence, two (2) loan

agreements: ADB loan agreement and AGTF loan agreement will be executed with the borrower.

5.2 Conditions Associated with Bank’s Intervention

A. Condition Precedent to Entry into Force of the Loan Agreements:

(i) ADB and AGTF Loans: The loan agreements shall enter into force subject to fulfilment

by the borrower of the provisions of Section 12.01 of the General Conditions Applicable

to Loan Agreements and Guarantee Agreements of the African Development Bank.

B. Condition Precedent to First Disbursement of the Loans

The obligations of the Bank to make the first disbursement of the loans shall be conditional

upon the entry into force of the agreements and the fulfillment by the borrower, in form and

substance satisfactory to the Bank, of the following condition.

(i) Evidence of the subsidiary implementation agreement signed between the Ministry of

Finance & Economic Planning and WASAC for the implementation of the program in

line with country practices.

C. Condition Precedent to Disbursements for Works-Related Items

Where applicable, the borrower shall provide evidence, in form and substance satisfactory to

the Bank, of the fulfillment of the following condition prior to disbursements for expenditures

related to works:

(i) All PAPs in respect of the concerned section have been compensated and/or resettled in

accordance with the RAP, any updates to the RAP, and the works and compensation

schedule.

D. Other Condition

The borrower shall provide evidence, in form and substance satisfactory to the Bank, of the

fulfillment of the following condition:

(i) Having opened a special account in the National Bank for the program, denominated in

foreign currency into which Bank funds will be deposited.

18

E. Undertakings

The borrower undertakes and agrees, in form and substance satisfactory to the Bank, to:

(i) Ensure that the GoR will provide counterpart funds during program implementation;

(ii) Carry out the program in accordance with: (a) Bank’s rules and procedures; (b) national

legislation; and (c) the recommendations, requirements and procedures set forth in the

ESIA prepared for the program;

(iii) Deliver to the Bank program quarterly reports, financial and technical audit reports in

form and substance acceptable to the Bank, including the borrower’s implementation of

the ESIA; and

(iv) Ensure adequate staffing for the program implementation.

5.3 Compliance with Bank Policies

5.3.1 This program complies with applicable Bank policies.

VI RECOMMENDATION

Management recommends that the Board of Directors approve the proposed ADB loan of USD

121.137 million (UA 87.508 million) and AGTF loan of USD 50 million (UA 36.119 million) to

the Republic of Rwanda for the purposes and subject to the conditions stipulated in this report.

I

Appendix 1: Rwanda’s Comparative Socio-Economic Indicators

Year Rwanda Africa

Develo-

ping

Countries

Develo-

ped

Countries

Basic Indicators

Area ( '000 Km²) 2016 26 30,067 97,418 36,907Total Population (millions) 2016 11.9 1,214.4 6,159.6 1,187.1Urban Population (% of Total) 2016 32.0 40.1 48.7 81.1Population Density (per Km²) 2016 481.7 41.3 65.1 33.8GNI per Capita (US $) 2015 700 2 153 4 509 41 932Labor Force Participation *- Total (%) 2016 84.9 65.7 63.5 60.0Labor Force Participation **- Female (%) 2016 86.3 55.7 48.9 52.1Sex Ratio (per 100 female) 2016 92.0 100.1 106.0 105.0Human Dev elop. Index (Rank among 187 countries) 2015 159 ... ... ...Popul. Liv ing Below $ 1.90 a Day (% of Population) 2013 60.4 ... 12.6 ...

Demographic Indicators

Population Grow th Rate - Total (%) 2016 2.4 2.5 1.3 0.6Population Grow th Rate - Urban (%) 2016 6.1 3.6 2.4 0.8Population < 15 y ears (%) 2016 40.6 40.9 27.9 16.8Population 15-24 y ears (%) 2016 19.3 19.3 16.9 12.1Population >= 65 y ears (%) 2016 2.9 3.5 6.6 17.2Dependency Ratio (%) 2016 76.8 79.9 54.3 52.0Female Population 15-49 y ears (% of total population) 2016 25.8 24.0 25.7 22.8Life Ex pectancy at Birth - Total (y ears) 2016 65.3 61.5 69.9 80.8Life Ex pectancy at Birth - Female (y ears) 2016 67.8 63.0 72.0 83.5Crude Birth Rate (per 1,000) 2016 30.5 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 31.1 52.2 34.6 4.6Child Mortality Rate (per 1,000) 2015 41.7 75.5 46.4 5.5Total Fertility Rate (per w oman) 2016 3.7 4.5 2.6 1.7Maternal Mortality Rate (per 100,000) 2015 290.0 476.0 237.0 10.0Women Using Contraception (%) 2016 54.1 31.0 62.2 ...

Health & Nutrition Indicators

Phy sicians (per 100,000 people) 2005-2015 5.5 41.6 125.7 292.2Nurses and midw iv es (per 100,000 people) 2005-2015 67.8 120.9 220.0 859.4Births attended by Trained Health Personnel (%) 2010-2015 90.7 53.2 69.1 ...Access to Safe Water (% of Population) 2015 76.1 71.6 89.4 99.5Access to Sanitation (% of Population) 2015 61.6 39.4 61.5 99.4Percent. of Adults (aged 15-49) Liv ing w ith HIV/AIDS 2015 2.9 3.4 ... ...Incidence of Tuberculosis (per 100,000) 2015 56.0 240.6 166.0 12.0Child Immunization Against Tuberculosis (%) 2015 99.0 81.8 ... ...Child Immunization Against Measles (%) 2015 97.0 75.7 83.9 93.9Underw eight Children (% of children under 5 y ears) 2010-2015 11.7 18.1 15.3 0.9Prev alence of stunding 2010-2014 44.3 33.3 25.0 2.5Prev alence of undernourishment (% of pop.) 2015-2016 31.6 16.2 12.7 ...Public Ex penditure on Health (as % of GDP) 2014 2.9 2.6 3.0 7.7

Education Indicators

Gross Enrolment Ratio (%)

Primary School - Total 2010-2016 133.6 101.2 104.9 102.4 Primary School - Female 2010-2016 135.1 98.4 104.4 102.2 Secondary School - Total 2010-2016 39.1 52.6 71.1 106.3 Secondary School - Female 2010-2016 40.9 50.2 70.5 106.1Primary School Female Teaching Staff (% of Total) 2010-2016 53.3 47.1 59.8 81.0Adult literacy Rate - Total (%) 2010-2015 71.2 66.8 82.3 ...Adult literacy Rate - Male (%) 2010-2015 74.7 74.3 87.1 ...Adult literacy Rate - Female (%) 2010-2015 68.3 59.4 77.6 ...Percentage of GDP Spent on Education 2010-2015 5.0 5.0 4.0 5.0

Environmental Indicators

Land Use (Arable Land as % of Total Land Area) 2014 46.6 8.7 11.2 10.3Agricultural Land (as % of land area) 2014 73.3 41.7 37.9 36.4Forest (As % of Land Area) 2014 19.2 23.2 31.4 28.8Per Capita CO2 Emissions (metric tons) 2014 0.1 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+)

COMPARATIVE SOCIO-ECONOMIC INDICATORS

Rwanda

June 2017

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II

Appendix 2: Table of AfDB’s Portfolio in the Country

The status and performance of the Bank’s project portfolio in Rwanda as at 7 September 2017

is summarized in the table below:

PROJECT Window Total

Approved (UA) Date

Approved Closing Date

Amount Disbursed (UA)

Dis. rate

Undisbursed amount (UA)

AGRICULTURE

1 FIP Rwanda Investment Preparation Plan

Strategic Climate Fund - Grant

183,030.84 28-Jun-16 31-Jun- 19 52,000 20.8% 131,031

TRANSPORT

2 Base Nyagatare ADB Loan 49,030,000 19-Nov- 14 31-Dec - 19 9,658,910 19.7% 39,371,090

WATER & SANITATION

3 Water & Sanitation Master Plan AWF Grant 1,550,987.41 21-Nov-16 30-Jun-20 107,085 5.5% 1,443,902

ENERGY

4 Scaling Up Energy Access Project ADF Grant 11,871,000 26-Jun-13 31-Aug- 18 5,442,547 46% 6,428,453

Scaling up Energy Access Project ADF Loan 15,494,000 26-Jun-13 31-Aug-18 8,522,742 55% 6,971,258

5 Increasing Climate Change Adaptive Capacity of Rwanda Communities

GEF/LDCF-Grant

6,460,805.04 31-Oct.-16 31-Dec-21 67,170 1% 6,393,635

HUMAN DEVELOPMENT

6 Support to Skills Dev in Science & Technology

ADF Loan 6,000,000 11-Nov-18 31-Oct-16 4,697,380 78% 1,302,620

7 Regional ICT Centre of Excellence ADF Loan 8,600,000 14-Dec-10 30-Jun-17 5,253,535 62% 3,346,465

8 EAC - CoE in Biomedical Sciences ADF Loan 12,500,000 26-Sep-14 30-Dec-19 351,763 2.8% 12,148,327

Total National Operations Public 111,689,823 34,153,132 27% 77,536,707

PRIVATE SECTOR

9 Kigali Bulk Water ADB Loan 14,642,468 16-Dec-15 30-Dec-18 0.0% 14,642,468

Total National Operations – Public + Private 126,332,291 34,153,132 26% 92,179,175

MULTINATIONAL

10 Rwanda – (Nyamitanga – Ruhwa – Ntendezi – Mwityazo Road)

ADF Grant 50,620,000 16-Dec-08 30-Jun-16 48,317,979 95.5% 2,302,021

11 Regional Rusumo Falls ADF Loan 18,884,000 23-Nov-13 31-Dec-18 421,312 2.2% 18,462,688

Regional Rusumo Falls NTF Loan 6,500,000 23-Nov-13 31-Dec-18 0 0% 6,500,000

12 Ruzizi III ADF Loan 1,500,000 16-Dec -15 31-Dec-22 84,799 5.6% 1,415,201

Ruzizi III ADF Loan 16,0000,000 16-Dec -15 31-Dec-22 0 0 16,000,000

13 NELSAP Interconnection

ADF Grant 30,470,000 27-Nov-08 31-Dec-16 26,934,401 88.40% 3,535,599

14 Rubavu – Gisiza road Project ADF Loan 40,525,000 27-Jun-12 31-Dec-17 21,395,853 52.8% 19,129,147

Rubavu – Gisiza road Project ADF Grant 4,525,000 27-Jun-12 31-Dec-17 1,250,255 27.8% 3,274,745

15 Lake Victoria Water & Sanitation Program

ADF Grant 15,110,000 17-Feb-10 31-Dec- 17 12,458,499 82.45% 2,651,501

16

Kagitumba Kayonza Rusumo Road Project

ADF Loan 66,560,000 22-Jun-16 31-Dec-20 9,442,093

14.2%

57,117,907

Kagitumba Kayonza Rusumo Road Project

EU-Infrastructure Grant

15,900,273 22-Jun-16 31-Dec-20 2,075,972 13.5% 13,824,301

17 Payment and Settlement Systems Integration Project

ADF Grant 3,690,000 5-Dec-12 1-Jun-17 1,512,900 41% 2,177,100

Sub-Total Multinational 270,284,273 123,894,062 46% 149,851,979

Grand Total (UA) 396,616,564 158,047,193 40% 242,031,154

III

Appendix 3: Key Related Projects Financed by the DPs in the Country

CURRENT PARTNERS IN THE WASH SECTOR (2017/2018)

No. Partner Project Name Location Brief Description

1 UNICEF UNICEF - WASH Ngororero (West Province)

Support WASAC to supply clean water and access to improved sanitation facilities in Ngororero district. Hygiene and sanitation awareness promotion activities in Muhororo, Sovu and Kabaya sectors.

2 JICA Improvement of Urban Water Supply Project

City of Kigali (Kigali)

Technical assistance to WASAC for strengthening capacity for the management of non-revenue water control in Kigali water network.

3 JICA

Rural water supply in Eastern Province Project (RWASOM PROJECT)

Rwamagana, Kayonza, Ngoma, Kirehe, Gatsibo (East Province)

Construction of water supply infrastructure and technical assistance to WASAC and the districts for strengthening capacity of operation and maintenance of the rural water supply systems.

4 AfDB Lake Victoria Water and Sanitation Program (LVWATSAN)

Nyagatare, Kayonza (East Province) & Nyanza (South Province)

Improvement of water supply & sanitation in the target areas through water supply and wastewater services development, and capacity building to WASAC and the districts.

5 AfDB / AWF

Rwanda National Integrated Water Supply and Sanitation Master Plans

Throughout the country

The project aims to provide long-term (25 year) water supply and sanitation masterplans. The outcomes include: 1) Masterplans for effective & efficient investments; and 2) improved capacity of WASAC and 30 districts to plan, design, finance, implement and manage projects and infrastructure.

6 WATER FOR PEOPLE

WASH Program – Water for People

Gicumbi (North Province), Kicukiro (Kigali), Rulindo (North Province)

Support to: - Rulindo district to achieve full coverage

to drinking water supply by 2018; - Kicukiro district to reinforce water

network by July 2018; and - Gicumbi district for achieve full

coverage to drinking water supply by 2021.

7 WATER AID WASH Initiatives Bugesera (East Province)

Support Bugesera district in the provision of safe drinking water through construction of water supply system.

8 Living Water International

LIVING Water International

Ruhango (South Province)

Support to Ruhango district in the provision of safe drinking water through borehole drilling and construction.

9 MLFM WASH - MLFM Gatsibo, Nyagatare (East Province)

Support to WASAC to supply water using turbo-pumping.

10

Swiss Agency for Development and Cooperation

SDC Water Supply Project

Rusizi, Nyamasheke (West Province)

Support to the districts in the rehabilitation and construction of water supply systems.

11 UN-Habitat Technical Assistance on Water Tariff Review

City of Kigali (Kigali)

Support to WASAC in revision of water tariff.

12 UNICEF

Rapid Assessment of the National Rural Drinking Water Quality Study

City of Kigali (Kigali)

Support to RURA in undertaking a rapid assessment of the national rural drinking water quality study.

IV

Appendix 4: Program Location Map

The map was obtained from a public source and has been provided for the exclusive needs of this appendix. The applications

and demarcations on this map do not imply any judgment on the part of the ADB and its members concerning the legal status

of territory or the approved acceptance of its boundaries