FEASIBILITY STUDY REPORT FOR URBAN
INFRASTRUCTURE PROJECT
USING LOAN FROM OFFICIAL DEVELOPMENT
ASSISSTANCE (ODA).
A CASE STUDY OF LAOCAI CITY DEVELOPMENT PROJECT
FUNDED BY WORLD BANK
by
Nguyen
Viet Cuong
Abstract
The development of socio-economic
infrastructure plays a very important role in the country developing strategy,
it is a major factor to help developing country reducing the poverty. The fund
for the infrastructure development can be from many sources: private sector,
counterpart, mixed credit and ODA loan…In order to meet the huge demand on
infrastructure project development, the preparations of project investment such
as project feasibility study is specially paid attention by Project Management
Units.
Furthermore, with the project using the loan
from international Donors, the feasibility study is not limited in project
financial aspects like loss or profit, it also studies the other social aspect
such as safeguard policies, economic benefits, benefit to the residents within
project… The project feasibility study report therefore also be considered as
approved factor for the Donor to give the loan.
The purpose of this study is to identify the
process to prepare a feasibility study report for the urban infrastructure
development project using the loan from World Bank. this process of preparing
feasibility study report need to be followed the government instruction as well
as complying with the World Bank regulation.
Executive summary
Rationale of research
This research has been conducted to indentify the course of
action to prepare feasibility study report for the urban infrastructure
development project using loan from World Bank.
Objectives of study
To prepare feasibility study report following guidelines of five
funding agencies (Asian development Bank, French Agency, World Bank, Japan Bank
for International Cooperation, German Bank for Reconstruction) to identify risk
of unrealistic FS report preparation and to analyze problem during preparation
of FS report.
Methodology
In this research methods are followed in accordance with the
five funding agencies i-e step by step completion of FS report from collection
of data to provincial people approval and World Bank non-objection letter.
Findings and conclusion
Apart from the project financial
advantages, the significant advantage from project implementation is that the
Project Owner and project shareholders particularly the Consultants are
approached to the international standards in project preparation and implementation.
Report helps in making decision of either invest or not to invest for
construction.
The project
shareholders, at any time during project implementation, must take note on the
compliance of Donor’s guidelines, as World Bank specialists supervises strictly
the project implementation to ensure the effectiveness of fund usage and development
criteria are complied.
The
project FS report has to be prepared in compliance with both Lender’s guideline
and Governmental rule and regulation. This appears to be the biggest challenge
for the Project Owner and FS Consultant, that why the selection of FS Consultant
need to be always considered carefully with the Non-objection from the Donors.
The
other issues such as the sustainable development and Community Awareness in
sanitation and environment, institution and capacity building also need to be
considered carefully and differently from the normal construction investment
project
During
the FS preparation stage, the difficulties will be occurred due the lack of
experience in project management from project owner to this new concept of
total project development, thus, the improvement of project communication and
information sharing must be paid attention to avoid the unnecessary delay.
Recommendations
The FS report is more difficult and complicated when compared
with commercial project report. The main procedure and guidelines are defined
by donor agency and lenders criteria, so I can only give my recommendations to
prepare reliable FS report using World Bank loan in particular.
·
Project management unit should be set up at early stage; matrix
structure under control of provincial leader.
·
The more accurate data, the more reliable report will be so need
of proper survey team and procedure.
·
As FS report preparation will be in direct supervision of World
Bank so consultant need to have experience of working with WB and have
experience in development of similar projects.
·
As FS preparation team is
different from presentation team to World Bank expert, so there is need of
proper communication system among stakeholders it can be done by telecom
conference with minute notes.
