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Expert Group Meeting on Road Maintenance and Management, United Nations ESCAP/The World Bank in Vietnam Improving Road Asset Management in Asia and the Pacific 30 May 2013 Asian Development Bank Daisuke Mizusawa, Infrastructure Specialist Key Topics • Overview of Asian Development Bank (ADB) • Road Maintenance and Management in ADB • Ongoing Preparatory Work for Knowledge Product, iRAP 2 ADB’s Profile • Establishment in 1966 • 67 member countries, 48 regional and 19 nonregional • HQ located in Manila, Philippines; has 19 Resident Missions in Asia • Representative offices in Frankfurt for Europe, Tokyo for Japan, and Washington, DC for North America • 2 subregional missions in the Pacific 3 Challenges Poverty – central challenge Widening disparities Demographic changes Severe strains on the environment Regional cooperation and integration needed Asia’s financial systems Emphasis on innovation, technology development and higher education • Weak governance • Infrastructure deficit • • • • • • • 4 ADB’s Strategy Vision An Asia and Pacific Free of Poverty Strategic Agendas Inclusive growth Environmentally sustainable growth Regional integration Drivers of Change Private sector development and sector operations Good governance and capacity development Gender equity Knowledge solutions Partnerships Core Specializations Infrastructure Environment , including Climate Change Regional Cooperation and Integration Financial Sector Development Education 5 Key Products and Services • Lending operations (public and private sectors) • Technical assistance operations • Regional cooperation programs (e.g., Greater Mekong Subregion, Central Asia Regional Economic Cooperation) • Bilateral and multilateral cooperation 6 MDB joint statement + voluntary commitment 7 Background to the commitment • Transport enables economic and social activity • - access to opportunities, services Huge investment needs ( $2.5 trillion between 2010 and 2020) 8 Congestion Air pollution Severance Climate change Road safety Copyright Ko Sakamoto Background to the commitment • Sustainable Transport = accessible, affordable, efficient, financially sustainable, environment friendly, safe • MDBs have been changing to focus on ST 15 ADB’s Sustainable Transport Initiative • Priority areas: 1. Urban transport 2. Transport and climate change 3. Logistics and cross-border transport 4. Road safety and social sustainability Sound Infrastructure is Required! 16 ADB’s Financial Operation 25,000 $ million 20,000 15,000 10,000 5,000 0 2008 2009 Sovereign (ADB Annual Report 2012) 2010 2011 2012 Nonsovereign 17 2012 ADB Assistance by Sector 710, 3% 1360, 6% 1300, 6% 310, 1% Agriculture and Natural Resources Education Energy 4910, 22% 5020, 23% Finance Health, Nutrition, and Social Protection Industry and Trade 1640, 7% 3590, 16% 2660, 12% 810, 4% Law, Economic Management, and Public Policy Transport and Communications Water Supply, Sanitation, and Waste Management Muti-Sector (ADB Annual Report 2012) 18 ADB’s Support to Road Subsector • Funding and Technical Support – – – – – – – – Survey Infrastructure Management Planning Project Preparation Civil Works (capital investment and maintenance) Procurement Private Sector Development Capacity Development Social Safeguards • Knowledge Sharing – – – – Biannual transport forum Workshops Training Publication 19 Road Maintenance and Management in ADB • Infrastructure projects towards maintenance and management – Performance-Based Routine Maintenance: Bangladesh, China, Sri Lanka – Labor-Based Maintenance: Cambodia, Lao PDR, Mongolia, Pakistan, Papua New Guinea, Solomon Islands, Sri Lanka, Tajikistan, Timor-Leste – Asset Management System: Bhutan, Cambodia, Papua New Guinea, Solomon Islands – Transport Fund: Solomon Islands – Safety Improvements – Climate Change Adaptation and Mitigation 20 Benefits of Maintenance and Management in Road Subsector Policy Congestion Pollution Demand Traffic; Deteriorated Infrastructure Yr. Yr. Yr. Supply Urban Planning, ITS, Maintenance, Management Agency/User Costs Maintenance, Management Yr. Yr. 21 How maintenance and management contribute to your country? Impacts Sustainable Infrastructure Management Outcomes •Assurance of maintenance funds •Articulation of future direction •Assurance of best expenditure of funds •Better accountability •Savings in agency and user costs •Improved asset performance •Improved capacity of agencies in charge •Satisfaction of using improved assets •Support from stakeholders Outputs •Maintenance funds •Strategic plan (indicators, prioritization, work program) •Database •Asset management system (work order, future asset condition, asset valuation) •Improved asset management practices (survey, analysis, monitoring) •Asset management policy dialogue Inputs •Infrastructure project •Technical assistance 22 Key Issues in Maintenance and Management • Policy and Planning Process – Policy must answer: • How do we best have our budget and spend it? • How do we allocate the budget effectively? → Establishment of maintenance culture → Identification of future resource needs → Integration of infrastructure management system into budget programming → Involvement of policy makers in discussion of infrastructure management 23 Key Issues in Maintenance and Management • Institutional Capacity – A wide variation in the capacity to manage the economy, the infrastructure and the provision of normal government services • The budget process, the source of funding – Weak management and inefficient work practice • Staff complement and training • Technical ability • Involvement of stakeholders in setting priorities and assessing outcomes – Ineffective “hit-and-run” technical assistance • Effectiveness of earlier and longer partners’ support → Establishment of dedicated function (e.g., Board, unit) and specification of roles → Continued capacity development → Private sector development → Collaboration with research institutes → Harmonization among development partners → Strengthening of Ownership of government 24 Key Issues in Maintenance and Management (cont’d) • Financial Sustainability and Budgeting – Insufficient funding – Complete with rival needs (e.g., health care, education) – Tend to follow precedent, preserving past budget shares – resistance to change – No user costs considered in maintenance funding decision – Little or no users’ voice in decisions on funding → Innovative financing mechanism (e.g., road maintenance fund) → Introduction of user charges, toll, overloading charges, etc. → Public involvement process (e.g., customer satisfaction) 25 Key Issues in Maintenance and Management (cont’d) • Public Goods – Traditional Economy: • Roads, railways, water, electricity, local telephone to be provided free of charge. – Growth Economy: • Growing infrastructure needs and the accompanying investment requirements should be financed by user groups and not the General Public. → “fee-for-service” basis 26 Key Issues in Maintenance and Management (cont’d) • Emerging Issues – – – – Climate change impacts Safety New procurement modality Country instability →Revitalization of road management initiative 27 Previous ADB Knowledge Products • • • • • • • • • • 2003 Road Funds and Road Maintenance: An Asian Perspective 2009 Training Tool for HIV Prevention and Safe Migration in Road Construction Setting and Affected Communities 2010 Guidance Note: Road Transport Subsector Risk Assessment 2010 Evaluation of Labor-Based Road Work Methods 2011 Guidelines for Climate Proofing Investment in the Transport Sector: Road Infrastructure Projects 2011 Community-Based Routine Maintenance of Roads by Women’s Groups (guide for communication bureaus, manual for maintenance groups) 2012 Financing Road Construction and Maintenance after the Fuel Tax Reform 2012 Performance-Based Routine Maintenance of Rural Roads by Maintenance Groups (guide for Communications Bureaus, manual for maintenance groups) 2013 Infrastructure Maintenance in the Pacific: Challenging the Build-NeglectRebuild Paradigm (by Pacific Region Infrastructure Facility) 2013 Encouraging Private Sector Development in the Road Sector in Pacific Island Countries (by Pacific Region Infrastructure Facility) 28 Ongoing Preparatory Works for Knowledge Product • Improving Road Asset Management in Asia and the Pacific (iRAM) – Recommend appropriate models of future ADB intervention to road asset management – Formulate the position of ADB Transport Community of Practice on specific topics • institutional setup • capacity requirements • business process – Integrate the position into future project design to enhance the sustainability of road infrastructure 29 Tasks for iRAM Knowledge Product • Stocktaking (Jun-Dec 2013) – Identify key issues facing iRAM – Determine criteria for good practice – Select specific aspects of iRAM to be focused • Literature Review and Compilation (Jun 2013-Jun 2014) – Review past ADB assistance and knowledge products, and international good practice and publications • Case Study and Data Analysis (Jan-Mar 2014) – Identify solutions and formulate opinions identified in stocktaking • Knowledge Production and Dissemination (Apr-Dec 2014) – Finalize knowledge product through internal review and peer review by international experts – Disseminate the product through workshops and conferences (e.g., ADB Transport Forum) 30 Request for iRAM • Information of issues and practice in your country and region through survey and interview • Peer review of iRAM knowledge product 31 Thank you any comments? For Contact: Daisuke Mizusawa Infrastructure Specialist [email protected]