Document of The World Bank

FOR OFFICIAL USE ONLY

Report No. T7675 - IQ

THE REPUBLIC OF IRAQ

THE MINISTRY OF ENVIRONMENT

PROPOSED TRUST FUND GRANT

OF US$5 MlLLION

FOR AN

EMERGENCY ENVIRONMENT MANAGEMENT PROJECT

World Bank Iraq Trust Fund TF053167 Trust Fund Grant TF057359

TECHNICAL ANNEX

January 10,2007

Environment, Rural, Social and Water Sector Middle East and North Africa. Region

This document has a restricted distribution and may be used by recipients only in the performance of their o@cial duties. Its contents mav not otherwise be disclosed without World Bank authorization.

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CFAA CPA DFID EIA EEMP ESSAF EPIC EPID FA0 FM FMA FMR FO Go1 HCW IBRD ICB IDA IRFFI ITF MOEn MOF MOPDC MSW MIM NAAQS NGO OPR PFS PIM PM PMT SBD SOE UNEP UNESCO USAID USEPA WHO

CURRENCY EQUIVALENT (Exchange Rate Effective September 26,2006)

Currency Unit = US$ US$ 1 = Iraqi Dinar 1474

FISCAL YEAR (Government of Iraq) January to December

ABBREVIATIONS AND ACRONYMS Country Financial Accountability Assessment Coalition Provisional Authority Department for International Development (UK) Environmental Impact Assessment Emergency Environment Management Project Environmental and Social Screening and Assessment Framework Environment Protection and Improvement Council Environment Protection and Improvement Directorate (Iraq) Food and Agricultural Organization Financial Management Fiduciq Monitoring Agent Financial Monitoring Reports Financial Officer Government of Iraq Healthcare Waste International Bank for Reconstruction and Development International Competitive Bidding International Development Association International Reconstruction Fund Facility for Iraq Iraq Trust Fund Ministry of Environment Ministry of Finance Ministry of Planning and Development Cooperation Municipal Solid Waste Master Implementation Manual National Ambient Air Quality Standards Non-Governmental Organization Operational Procurement Review Project Financial Statements Project Implementation Manual Particulate Matter Project Management Team Standard Bidding Documents Statement of Expenditure United Nations Environmental Programme United Nations Educational, Scientific and Cultural Organization United States Agency for International Development United States Environmental Protection Agency World Health Organization

Vice President Daniela Gressani Countxy Director Joseph P. Saba Sector Director Inger Andersen Sector Manager N. Vij ay Jagannathan Task Team Leader Maria Sarraf

I . BACKGROUND ........................................................................................................................... 4

....................................................................................... I1 . BANK RESPONSE AND STRATEGY 5

I11 . DETAILED PROJECT DESCRIPTION .................................................................................... 6

IV . INSTITUTIONAL ARRANGEMENTS AND PROJECT IMPLEMENTATION ................... 11

V . FINANCIAL AND ECONOMIC JUSTIFICATION ................................................................ 14

.................................................................................................................. VI . POTENTIAL RISKS 15

VII . TIMETABLE OF KEY PROJECT EVENTS ............................................................................ 16

List of ~nnexes: ANNEX 1: MOEN BACKGROUND DESCRIPTION ................................................................................. 17

ANNEX 2: PROJECT COSTS ...................................................................................................................... 20

ANNEX 3: KEY PROJECT INDICATORS ................................................................................................. 21

ANNEX 4: PROCUREMENT ARRANGEMENTS AND PROCUREMENT PLAN .................................. 22

ANNEX 5: FINANCIAL MANAGEMENT AND DISBURSEMENT ARRANGEMENTS ........................ 26

ANNEX 6: AIR. WATER & WASTE MANAGEMENT IN IRAQ .............................................................. 30

ANNEX 7: NAME OF STMF AND CONSULTANTS WHO WORKED ON PROJECT .......................... 35

ANNEX 8: DOCUMENTS IN THE PROJECT FILE .................................................................................. 35

1. Country background. Iraq is rich in natural and human resources and was a middle-income country in the 1970s. But years of conflict, sanctions and wars have had a significantly negative effect on Iraq's economy with people suffering a severe decline in their standards of living. Although in the 1970s the health and educational institutions in Iraq were regarded as among the best in the Middle East, the current health and education indicators of Iraq are well below the regional average. An estimated 10 percent of the population has income of less than a dollar a day, and unemployment is estimated at 25-30 percent of the population. According to the United Nations, approximately 25 percent of the population is dependent on food rations. The agriculture sector has declined and is characterized by poor productivity and ineff~cient water use. Infrastructure in all sectors, including water and sanitation, is dilapidated and mostly dysfunctional. The current political and security environment remains unstable with negative impacts on basic services. Rebuilding the Iraqi economy and institutions remain a formidable challenge.

2. Key environmental issues. Iraq is also facing very serious environmental problems, including poor water quality, air pollution, waste management, contaminated sites and the deterioration of key ecosystems. With environmental problems neglected to a large extent prior to the war as well, the decades of war, conflicts and economic sanctions have further worsened the environmental conditions. The problems are aggravated by the country's weak environmental governance structure.

3. Water quality has been declining because of the discharge of untreated sewage into rivers, the increase in salinity from agricultural practices, excess fertilizer leached from agricultural land and significant heavy metal and organic pollutants discharged into rivers by the manufacturing industries. Air quality has been declining because of an obsolete fleet of vehicles, heavy traffic in urban areas, emissions from industries (mainly metallurgical, petrochemical & refineries and cement), open burning of solid waste and emissions from smelters. Solid waste management capacity in urban areas has weakened over last few decades.

4. Government Response. The Government of Iraq (GoI) established the Ministry of Environment (MOEn) in 2003 instead of the Directorate of Environmental Protection and Improvement for supporting the environmental management in the country. The annual budget of MOEn for 2006 is about US$7 millions (covering salaries and operating costs). It consists of 750 staff mostly deployed from other Ministries. Of these, 350 are professional staff based in Baghdad and in the Environmental Directorates of 14 Governorates. The remaining are administrative and office support staff. A chart of the Ministry of the Environment is at Annex 1. Environmental standards, guidelines, monitoring and enforcement, the main functions of the Ministry, are almost non-existent. The Government intends to strengthen the capacity of the MOEn and make it effective as quickly as feasible. It also intends to reduce pollution and resource wastages, promote clean technologies and educate entrepreneurs and the public about resources conservation. The Go1 recognizes the need for administrative reforms, with budgetary and hancial discipline, and intends to strengthen the appropriate management structures for the environment management at both the national and provincial levels.

5. The Go1 recognizes the need to start with basic environmental functions (such as monitoring and enforcement) and identifying major environmental issues (such as air pollution, water pollution and

municipal & hazardous waste) as pre-requisites for containing long term environmental problems. With the assistance of United Nations Environmental Program (UNEP), the Government has prepared the first Institutional Capacity Assessment of MOEn (summarized briefly in Annex 1). Go1 has also prepared a revised Law of Environment Protection and Improvement Number (3) of 1997. The revised law emphasizes punitive actions but lacks substantial provisions for stimulating pollution control and natural resource conservation.

6 . Concerned by the seriousness of environmental deterioration and the weakness of the newly created Ministry of Environment, the World Bank and MOEn prepared in 2004 an Emergency Environment Management Project for an amount of US$25 million. This project was expected to be financed through the Italian Trust Fund (for US$20 million) and through the Iraq Trust fund (ITF) (for US$5 million). The earlier project consisted of a capacity building component and an investment component. The project was pre-appraised by the World Bank in December 2004 and approved by Iraq's Ministry of Planning and Development Cooperation on May 23, 2005 (reference no. 85-8ab-2005). However, the Italian Trust Fund did not materialize and the project was put on hold. During the preparation of the Second Interim Strategy for Iraq, approved by the Board, the Government of Iraq and the World Bank reiterated the importance of strengthening the capacity of the MOEn through an environment management project. Accordingly, the project was redesigned to focus on the capacity building component for an estimated US$5 million. The revised project - which bears the same title as the previous one - has been discussed with the MOEn and was approved by the Ministry of Planning and Development Cooperation on March 29,2006.

7. The Second Interim Strategy for Iraq supports sector reform agenda on environment, water and waste water management, energy, agriculture and drainage and education sectors to be funded through the ITF as well as International Bank for Reconstruction and Development (IBRD) and International Development Agency (IDA) credit. The environment section of the Second Interim Strategy calls for (a) the provision of training on environment and social safeguards based on the Environment and Social Screening and Assessment Framework (ESSAF) for Iraq, (b) developing and implementing the Emergency Environment Management Project (EEMP) and (c) preparing a regional project in Shatt El Arab. EEMP is the first environmental operation in Iraq. It will complement and support other emergency projects under design and implementation, including the water, waste water, energy, education, rural roads, irrigation and community development, all of which rely on an enhanced capacity for sustainable environmental management. Moreover, although the political and security situation in Iraq is not yet settled, it is incumbent upon the World Bank and other donors that are financing large scale infrastructure projects to help Iraq develop a proper environmental, legal and institutional framework to control adverse environmental impacts from the reconstruction process.

8. The Bank strongly believes that Iraq's environmental issues cannot be resolved unless the policy and institutional failures are addressed first, proper technical tools are used and information dissemination is introduced. The GoI, at its own initiative, has been trying to strengthen the capacity for environmental management and the creation of MOEn as a separate Ministry in 2003 was a step in this direction. But environmental protection is a relatively new concern in Iraq, and the Ministry of Environment is still striving to establish influence and credibility within the Government. By strengthening the capacity of MOEn, the EEMP will bolster the government's initiative. Establishing a solid foundation to MOEn at the early stage of the reconstruction process is also likely to have higher effectiveness in shaping its organizational ability. While the proposed EEMP investment is relatively small, the benefits from building MOEnYs capacity to address environmental issues will be significantly large in both the short and

medium term. In the short term, MOEn will be able better prepared to prevent adverse impact to the environment fiom large reconstruction projects in Iraq. In the medium term, when the security situation settles, MOEn will be in a stronger position to plan and execute large environmental protection projects. EEMP is designed to address capacity in three key sectors associated with environmental management - air, water and solid-waste management - to enable MOEn to gain comprehensive expertise.

9. The EEMP will not attempt to address all environmental issues facing the country. Rather, it will strengthen the capacity of MOEn in undertaking a few of its core functions. The chosen functions shall be relevant in the context of major environmental issues challenging Iraq in the air, water, land and waste sectors, and will be tested for effectiveness by selected demonstration activities in a subsequent project.

10. The EEMP complements donor assistance in the environment sector. Most assistance so far has focused primarily on the restoration of the Marshlands. In addition, the World Health Organization (WHO) has rehabilitated one of MOEn's buildings and provided water analysis laboratories (for an amount of US$2.9 million). Also, UNEP has assisted the MOEn to assess and monitor a number of contaminated sites at a cost of US$4.7 million. Whilst such donor support has been helpful, it has not addressed some of the core environmental management issues in Iraq such as establishing environmental standards and guidelines, executive regulations to the laws, monitoring and enforcement mechanisms and strengthening the Environmental Impact Assessment (EIA) capacity. EEMP will address these needs. Moreover, the Bank's convening power will likely catalyze future donors' support in the field of environment and harmonize donor interventions.

11. The proposed project is fully consistent with the MOEn's Mandate and Action Plan. It will help MOEn address its mandate and key priorities as laid out in its Action Plan of 2005. The Action Plan calls for assuring that the people of Iraq have a clean and healthy environment and that the Ministry will adopt and maintain a system of environmental laws, regulations and procedures for protecting the environment and conserve its natural resources.

12. The project development objective is to strengthen key institutional and regulatory functions of the Ministry of Environment. These key institutional and regulatory functions will enable MOEn to undertake environmental policy analysis and coordination, formulate laws and regulations, monitor environmental quality, promote environmental awareness and conduct technical studies

13. The project is divided into four components as described below. Given the current security situation in Iraq, a flexible approach has been adopted in the project design, with following attributes:

components have been designed such that they can be implemented independently from each other; while respecting the overall objective of the project, activities under each component can be amended after supervision missions by taking into account the field-level experiences during implementation.

The total estimated cost for this proposed project is US$5 million (US$4.7 million + US$0.3 million in contingencies). Detailed project costs are given in Annex 2.

Component 1 - Strengthen the Environmental Management Capacity of the Ministry of Environment (USS0.9 million)

14. The objective of this component is to strengthen the environmental management capacity of MOE~' . It will focus on four key environmental functions of the Ministry of Environment:

(i) Policy formulation through the preparation of an Environment Action Plan for Iraq. The objective of this plan is to analyze environmental issues in Iraq and propose priorities for environmental intervention in the next 3-5 years. The Plan will be achieved by:

(a) providing consultancy services to environmental experts on policy formulation; (b) training and study tours for MOEn staff on preparation of environmental action plans and

environmental planning; and (c) organizing workshops among key stakeholders to reach consensus on elements of the action

plan.

(ii) Strengthening the regulatory fitnetion of MOEn. The objective of this subcomponent is to assist MOEn in revising the Law of Environmental Protection and Improvement; preparing andlor revising executive regulations related to key sectors (such as EIA, air, water, wastewater, soil); preparing standards and guidelines on EIA, ambient air and water quality, emissions and discharges of water and wastewater, and chemical safety management. This will be achieved through:

(a) the provision of 1ocaVinternational consultants for preparation, revision of law and executive regulations, and preparation of guidelines;

(b) conducting training programs for local officers, judges and lawyers; (c) conducting training and study tours on the preparation and supervision of EIA for MOEn

staff of at least 4 governorates (such as: Baghdad, Basra, Mosul and Najaf), highlighting the methodology for undertaking ESSAF assessment;

(d) undertaking awareness workshops on the implementation of the Environmental Law for NGOs, and private sector; and

(e) undertaking workshop on chemical safety management.

(iii) Strengthening the monitoring and enforcement capacity of the Ministry. One of the main recommendations of UNEP's Institutional Capacity Assessment is to improve MOEnYs law making and inspection capabilities. As such this sub-component will develop inspection manuals and provide on-the- job training to environmental inspectors. This will enable MOEn to better monitor the polluting industries and enforce environmental laws. The strengthening of the monitoring and enforcement capacity will be achieved by:

(a) providing consultancy services for the development of inspection manuals and procedures, and

(b) providing training for environmental inspectors on monitoring and enforcement.

(iv) Raising environmental awareness among school children. Current environmental awareness is weak in Iraq and MOEn is keen to address this issue. This component will, therefore, focus on raising awareness among school children through targeted educational activities in about 50 pilot schools for improving their understanding of the potential consequences of environmental pollution and encouraging environment £riendly behavior. The selection of schools for awareness programs will be made by the PMT and will be based on (a) academic reputation of the school, (b) ability of the PMT to monitor the awareness program in the locality, and (c) availability of teachers with science background and exposure to environmental issues. Any prior initiative taken by the school for raising environmental awareness will count favorably for selection. This sub-component will serve as a pilot to be replicated in future projects

1 This component builds on the Institutional Capacify Assessment of MOEn prepared by UNEP in 2006, as summary of which is available in Annex 1.

in other schools across the country. This will ensure that environmental protection and conservation is ingrained in the minds of the younger generation. The creation of awareness will be achieved by:

(a) purchasing and preparing environmental awareness tools and material (such as leaflets) targeted at schoolchildren to promote environmental messages. ; and

(b) undertaking awareness campaigns. Besides printing leaflets and banners, the average allocation of US$3,000 per school will be spent on organizing awareness campaigns through skits, plays and poster-making, debates and guest lectures. These events will be spread over two to three years following a schedule to be finalized by the PMT.

Component 2 - Develop Capacity in Environmental Monitoring (USs2.6 million)

15. The objective of this component is to strengthen the environmental quality monitoring function of MOEn. It will focus on (i) installing air quality monitoring network in 3 cities in Iraq and (ii) assisting MOEn in improving coordination, collection and disclosure of data on water quality.

(i) Air Quality Monitoring: The objective of this sub-component is to establish an air quality monitoring network in Iraq's three largest cities - Baghdad, Mosul and Basra. The deterioration of air quality is a key public health issue. As determined by the Decision Support Study commissioned by the World ~ a n k ~ , the major contributors to urban air pollution are: an obsolete fleet of vehicles (using either leaded or diesel fuel), heavy traffic in urban areas, emissions fiom heavy industries (mainly metallurgical, petrochemical and refineries and cement plants), as well as open burning of solid waste and emissions fiom smelters. As such there is a mounting recognition in Iraq for the need of effective air quality management. MOEn is the primary institution responsible for air quality monitoring but has limited capacity. In the absence of air quality management system, MOEn lacks data essential for designing sound policies for air pollution control and raising public awareness. The design of this sub component is based on a Need Assessments for Air Qualify Monitoring commissioned during the preparation of this project3. The sub-component will consist of

(a) Purchasing and installing 15 fixed station and 3 mobile monitoring stations for the cities of Baghdad, Basra and Mosul. These stations will be equipped with necessaly gas and particulate analyzers, meteorological sensors and calibrators. Stations in each city will be linked to a central location at MOEn offices where the data will be compiled, analyzed and reported.

(b) Developing an air quality database. This database will enable MOEn to inform the public at large about air quality in each city, its impact on public health, and mitigating behavior that could be adopted to minimize and protect from air pollution. It will also be shared with other sector ministries (industry, transport, public works, etc.,) to enable them to develop a pollution control strategy and tackle the most pressing air pollution issues. It will also provide information on pollutant concentrations as a basis for assessing their likely impact on the health of the exposed population.

(c) Providing training to MOEn sta f f in all three cities to enable them to conduct routine site visits to all monitoring stations to perform site and equipment inspection, maintenance, analyzer calibration, and station inter-calibration. Training will also be provided in data processing in order to transform the collected raw data by appropriate validation, analysis and

* Tebodin Decision Support System for Integmted Pollution Control Modeling in Iraq, December 2004. The report is available in the Project File.

El Fadel M. Needs Assessment for Air Quality Monitoring Equipment in Imq, July 2006. A summary of this assessment is found in Annex 6. The whole report can be found in the Project File.

interpretation into useful information that targets the needs of the scientific community, policy planners, health professionals and public end-users.

(ii) Surface Water Quality Monitoring: The objective of this sub-component is to assist the MOEn in improving coordination, collection and disclosure of data on surface water quality in part of the Tigris River passing through Baghdad. This is because there aie substantial amounts of data available on surface water quality but they are largely fragmented and inconsistent. The responsibility for water quality monitoring is shared between MOEn and the Ministry of Water Resources, without clear demarcation of roles and mandates (for further information refer to Annex 6). This subcomponent will facilitate the coordination of surface water quality information primarily between the Ministries of Environment and Water Resources. Surface water quality data will be limited to part of the Tigris passing through Baghdad. This will be achieved through:

(a) purchasing portable equipment to assist MOEn with surface water quality monitoring data collection;

(b) providing the services of an individual consultant to analyze existing water quality data, consolidate them and publish them on MOEn's website;

(c) organizing working group meetings between all relevant sector ministries to coordinate and consolidate data information; and

(d) developing a Surface Water Quality web page on the MOEn's website. This website will include water quality monitoring data from different sources. MOEn will encourage all stakeholders to disclose as much information as possible so that the site will develop into a usehl information source for the scientific community and the public at large.

Items (c) and (d) will be funded by MOEn as part of its contribution to the project.

Component 3 -Strengthen Technical Capacity in Waste Management (USS0.8 million)

16. The objective of this component is to strengthen the technical capacity of MOEn for carrying out pre-investment studies in municipal and healthcare waste management. These studies will prepare the ground for the Mayorality of Baghdad and the Ministry of Health to carry out investments in waste management.

17. This component addresses and fixes the urgent needs of Baghdad city to deal with municipal and healthcare wastes generated on a regular basis and in large quantities. The hazardous nature of municipal and healthcare wastes poses major health and environmental concerns to the citizens on a daily basis. Three studies will be undertaken by MOEn.

(i) Two studies on municipal waste management will be conducted with the technical collaboration of the Mayoralty of Baghdad. These are;

(a) Municipal Solid Waste Master Plan for Baghdad: The objective of this master plan is to: - Analyze and evaluate the current solid waste management system as well as existing

institutional, legal and financial framework; - Develop techno-economical options to improve solid waste management services (collection,

transfer, .treatment and disposal); - Consult with appropriate stakeholder to select the most appropriate option; - Develop a detailed investment plan for the selected option (the investment plan should

encourage private sector participation); - Prepare guidelines for landfill site selection; - Identify training needs to implement the investment plan; and

- Provide training workshop on integrated solid waste management.

(b) A Study on the Rehabilitation and/or Closure of two priority Uncontrolled Dump Sites in Baghdad - possibly: Ammary (about 2 million m3) and Sabiyat (about 1 million m3) in Al-Taji area. This study will assess the current situation at these dumps from the geological, hydrological, environmental, social and technical point of view; develop a techno-economic study for the appropriate rehabilitation and/or closure of these dumps; prepare the technical specification for their rehabilitation and/or closure.

(ii) The third study on healthcare waste management will be conducted in collaboration with the Ministry of Health. It will constitute an Assessment and Action Plan for Health Care Waste Management for Baghdad Medical Complex Center (which consists of 12 medical institutions) and Al-Yarmouk Hospital. The objective of this study is to assess the existing waste management practices of the Center, determine the waste generation rates and waste composition, and on this basis develop an action plan to improve the waste management practices of the center. The action plan will propose an improved system for collecting, storing, transferring, treating and disposing waste. It will also prioritize necessary investments.

18. These studies will be fully funded by the proposed Grant. MOEn will be responsible for contracting. A working group has already been established between MOEn, the Mayorality of Baghdad and the Ministry of Health. The role of the working group is to (a) prepare and agree on the terms of reference of the studies; and (b) follow up on the studies progress and provide guidance to the consultants. Once completed, these studies will enable the Mayorality and the Ministry of Health to carry out investments in waste management.

Component 4 - Establish a Project Management Team (USS0.4 million)

19. A Project Management Team (PMT) will be responsible for managing, coordinating and monitoring all components of the project. The PMT has already been officially established through Administrative Order no. 1245 dated 21 June 2006. The PMT will include the following staff:

o A Project Director (who is also the Deputy Minister) o A Project Manager o A procurement specialist o A financial specialist; o An environment specialist, with solid background in environmental law, standards and public

awareness, responsible for Component 1. o An air quality specialist responsible for Component 2; o A waste management specialist responsible for Component 3: o A project assistant.

20. All the above staff are current employees of the MOEn. The project will finance the recruitment of additional short-term experts outside the ministry on an as-needed basis to complement the technical capacity of the team.

21. This project will also finance training and capacity building for all PMT staff in both technical and fiduciary (procurement and financial) management. As long as the situation prevents supervision mission to be carried out in Iraq, the project will finance all expenditure for the travel of PMT members to attend supervision meetings in nearby cities, such as Amman or Beirut.

22. The project will also finance the purchase of all necessary equipment (furniture, computers, etc.) to enable the PMT to implement the project. It will also finance the purchasing or renting of cars.

IV. INSTITUTIONAL ARRANGEMENTS AND PROJECT IMPLEMENTATION

Project Management

23. The project will be implemented over 4 years. Project activities are expected ordabout October 2007 and should be completed by September of 2010. Because of the lack of familiarity with World Bank fiduciary guidelines, the Project Management Team will be encouraged to coordinate and learn from PMTs working on other Bank-funded projects.

24. In order to facilitate the implementation of the project, the Minister will delegate power authorizing procurement and disbursement decisions to the Deputy Minister for Technical Affairs. The Project Manager reports directly to the Deputy Minister for Technical Affairs. The MOEn will make available for the project at least 2-3 offices.

25. The PMT has officially been established through Administrative Order no. 1245 issued on 21 June 2006. The PMT will report directly to the Deputy Minister for Technical Affairs.

26. PMT staff will coordinate the implementation of this project with other MOEn units, especially the Directorate General of Planning and Technical Follow-up, the Directorate General of Baghdad Environment, the Directorate General of Governorate Affairs, the Center for Technical Information, the Council for Environmental Consultation and Coordination and the Center for Information and Public Awareness (see Annex 1). In addition, they will have to coordinate with the Solid Waste Department of the Mayorality of Baghdad and the Ministry of Health for Component 3, as well as various institutions working on water quality for Component 2.

Procurement

27. Procurement for this project will be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, and the provisions stipulated in the Trust Fund Grant Agreement. The general description of various items under different expenditure categories is given in Annex 4. For each contract to be financed by the Grant, the procurement methods or consultant selection methods, estimated costs, prior review requirements, and time frame are reflected in the Procurement Plan (PP). The PP will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. A General Procurement Notice has been published in Dg Market on August 29, 2006 and in UN Development Business. In addition procurement procedures and sample bidding documents can be found in the Master Implementation Manual (MIM).

28. To expedite the implementation, the first bidding documents for air quality monitoring stations has been prepared by the Project Management Team and sent to the Bank for No Objection prior to negotiations.

29. High Risk - Weak Control Environment. Iraq's ability to manage public resources is undermined by poor security and outdated administrative practices. Moreover, Iraq is ranked poorly on Transparency International's Corruption Perception Index, the lowest of all countries in the Region. There are reports from the auditors of the US Government Accountability Office and the auditors of the Office of the Commission on Public Integrity (published in the media) that significant amounts of h d s cannot be accounted for or the spending cannot be backed up with sufficient documentation. The audit also found

that its efforts were hampered by rampant disorganization and poor bookkeeping and that contract files were LLunavailable, incomplete, inconsistent and unreliable." As part of risk mitigation in the project, the following measurements were considered in the design of the operation and for the implementation of the project :

- Design the operations and procurement packaging with increased attention to mitigate the risk of weak control environment;

- Devote greater supervision attention at the project level; e.g. lower the prior review threshold and conduct ex-post procurement reviews fi-equently;

- Use the services of the Fiduciary Monitoring Agent, appointed by the Bank, to conduct fiduciary monitoring of this project including spot physical inspection;

- Ensure that the client fi-om the start establish a good record keeping for all procurement and contract management and develop a good filing system;

- Train PMT staff and the designated procurement officer, in particular, on sound procurement practices following the ethics and code of conduct required by the implementing agency;

- Inform the PMT as well as the private sector on the procedures the Bank takes in case of allegations of corruption;

- A Bank local procurement consultant who is on the ground will closely supervise procurement activities;

- Limit the use of non competitive procedures in procurement of goods and services as well as in consultants' selections;

- The Bank is now engaged with the government in supporting the reform of the public procurement sector which will include, as part of the reform drafting, a unified public procurement law.

Disbursement

30. The proposed Grant of US$5.0 million is expected to be disbursed by September 2010~. Table 5.1 in Annex 5 describes the allocation of the Grant proceeds according to each expenditure category.

31. The Bank's strategy is to ensure Iraqi ownership and strengthen institutional capacity by financing operations that are implemented by Iraqi ministries and other recipient entities. Trained Project PMTs are established to facilitate implementation and help ensure compliance with fiduciary and other safeguards. PMTs are employed and paid by the implementing agency at regular salary levels, thereby avoiding the disadvantages of stand-alone Project Implementation Units that can potentially erode civil service institutional capacity over the medium and long term. The Project will finance specialized technical support in procurement, financial management and other areas, as needed. In addition, to ensure that project h d s are used for the purposes intended and to help carry out project supervision on the ground in Iraq, the Bank has hired an independent firm as Fiduciary Monitoring Agent (FMA).

32. As a further compensating control, disbursements will be made primarily through direct payment by the Bank to the consultants and vendors. Once authorized by the MOEn, direct payments will be made by the World Bank into the account of the consultant, or vendor in a commercial bank capable of receiving funds transferred internationally.

33. Disbursements for the project management component and payments below the threshold of US$20,000 normally will be made through payments by the Recipient from its own resources. These

The project closing dates assumes that the ITF termination date (currently set at December 31,2007) will be extended by until December 31, 2010. Should the TIT termination date not be extended, the Recipient would need to seek additional sources of fmancing for completing the project's activities.

payments made fiom the Recipient's own resources will be reimbursed, on a periodic basis, by the Bank to the MOEn upon presentation of full supporting documents, proof of payment and a signed withdrawal application. The Bank may later require the use of Statements of Expenditure (SOE) for payments below US$20,000. The PMT and the main financial counterparts fiom the MOEn will be provided intensive training in Bank disbursement procedures.

Financial Management

34. The project financial resources are extended through the ITF and will be managed within the framework of the MOEn systems, regulations and controls. A financial management assessment was undertaken remotely, through meetings with MOEn representatives to assess the MOEn financial management system and to determine the arrangements to be adopted in order to enhance the existing controls and fulfill the reporting requirement of the project.

35. Based on the results of the assessment and the outcome of the various reports issued by independent auditors and other donors, the fiduciary risk of the Grant not being used for the intended purposes - with due regard to economy, efficiency and the sustainable achievement of the project's development - is considered as high. The financial management risk as an element of the fiduciary risk is also high.

36. This financial management risk will be partly managed through: - reinforcing the present controls as applied by the MOEn; - providing intensive training in financial management; - making most payments directly to consultants and vendors; - maintaining a fixed assets register and spreadsheet for purchased and delivered equipment; - using a spreadsheet application to keep track of the project accounts and to generate the project

reports; - having a FMA inside Iraq to monitor the project activities and to support the PMT; - engagement of an independent auditor, with international experience acceptable to the Bank, to

perform the project audit and issue an independent auditor's opinion; - documenting FM arrangements in a chapter of the Project Implementation Manual (PIM) based

on the Master Implementation Manual and have the roles and responsibilities of the PMT members clearly specified; and

- in addition, the residual risk, where possible, will be managed during project implementation through close monitoring and supervision by the project Financial Officer

37. The financial management-related risks and risk-management tools are reflected in Annex 5 .

Project Supervision

38. Supervision will be carried out by the Bank team, the Bank's local consultants and the Fiduciary Monitoring Agent. Since travel to Iraq is difficult under current circumstances, supervision will be centered on a detailed results-based analysis and is planned as follows:

(i) Quarterly progress reports: The PMT will send the Bank a quarterly progress report. The format will be agreed with the PMT at the start of the project and will detail the progress on each of the projects' components. For the air quality component, digital photo documentation will also be required.

(ii) The Fiduciary Monitoring Agent reports: On a monthly basis, the FMA will produce a Procurement Report and a Financial Report.

(iii) Supervision missions: The Bank team will try to meet with the PMT every four months for the first year, and depending on the progress of the work, will meet every six months in subsequent years. In the meantime, every two weeks audio conference will be established with the PMT to follow up project progress.

39. The Bank, as the Iraq Trust Fund Administrator, will supervise ITF-funded operations in accordance with the Bank's applicable policies and procedures. While staff travel to Iraq is restricted, supervision of recipient-executed operations will be carried out through consultants and the Fiduciary Monitoring Agent (FMA) .

40. Reporting to Donors: The Bank will maintain separate records and ledger accounts in respect of the finds deposited by the donors with the Bank under the ITF. Within ninety (90) days of the end of each quarter (March 31, June 30, September 30, and December 3 l), the Bank will prepare, on a cash basis, an un-audited statement of receipts, disbursements, and fund balance with respect to the ITF and forward a copy to each donor. Each such statement will be expressed in United States Dollars, the currency in which the ITF funds will be maintained by the Bank. In addition, within one hundred and eighty (180) days of the completion of all disbursements relating to activities financed from the ITF, the Bank will prepare on a cash basis an un-audited financial statement of receipts, disbursements, and find balance with respect to the ITF and forward a copy to each donor.

4 1. The Bank will furnish the donors: (i) on a semi-annual basis, a consolidated report describing the operations of the ITF (including

contributions, disbursements, and implementation progress) in the preceding six months; and ' (ii) on an annual basis, a management assertion, together with an attestation from the Bank's

external auditors, concerning the adequacy of internal control over cash-based financial reporting for the trust fund as a whole.

42. The Bank will require a financial statement audit of the ITF to be performed by the Bank's external auditors on an annual basis. The costs of such an audit, including the internal costs of the Bank with respect to the audit, will be charged to the ITF. The Bank will provide each donor with a copy of the auditor's report.

Environmental and Social Safeguards

43. This is a Category C project. It entails almost no physical works and has no negative environmental impacts. This project will actually contribute to strengthen the capacity of MOEn in monitoring and supervising Environmental Impact Assessment (EIA). It will also train MOEn staff in the use of the Environment and Social Screening and Assessment Framework (ESSAF) to ensure that World Bank-financed projects in Iraq follow minimum due diligence in managing environmental and social risks.

V. FINANCIAL AND ECONOMIC JUSTIFICATION

44. The total estimated cost for this proposed project is US$5 million. A detailed breakdown of costs can be found in Annex 2. A technical assistance project does not usually require an economic analysis, because of the difficulty involved in quantifying project benefits. Although no attempt has been made to quantify those benefits and to estimate the project economic rate of return, a brief qualitative description of the potential benefits is provided.

45. Component 1- Strengthen the Environmental Management Capacity of the MOEn: By strengthening the legal, regulatory and EIA capacity of MOEn, the project will ensure that reconstruction projects - particularly those financed by the World Bank - do not further exacerbate the degradation of the environment in Iraq, but ensure minimum due diligence in managing environmental and social risks. The benefits of a robust ministry with clear standards, rules and regulations and strong monitoring and enforcement capacities are huge in terms of both preventing further deterioration of environmental quality and working towards the conservation and protection of a healthy and clean environment.

46. In addition, the benefits of the pilot awareness campaign targeted at school children are likely to be important in the long run. The campaign will be expanded by the MOEn to cover other schools if the response is found encouraging. Although the direct benefits of this campaign will not be observable in the short-term, the activities will have positive impact in the long-term with children imbibing the values of environmental protection and conservation. As the schools will be selected on the basis of academic achievements, students from these schools are expected to occupy positions of influence in later life, thus helping to shape future policies favorable to environmental conservation. Most importantly, children have direct stakes on environmental issues because the continuing degradations will likely manifest very adversely by the time the current students have reached adulthood. Raising awareness among them will help attenuate environmental degradation as the new generation matures.

47. Component 2 - Develop Capacity in Environmental Monitoring: Investing in air and water quality monitoring will positively impact public health. Assuming that the proposed project will be used by GO1 as part of a larger strategy on pollution control, incremental benefits - above and beyond those from the pollution control programs - are likely to occur. A good air quality monitoring network, managed by well-trained technicians and yielding credible monitoring data, will allow policy makers to better target pollution control investments and increase the efficiency of pollution control measures.

48. Component 3 - Strengthen Technical Capacity in Waste Management: Soil and water contamination fiom improper municipal and healthcare waste management is a major environmental concern facing the day to day life of Iraqi citizens. Preparing a municipal and healthcare waste management plan will set the agenda for future government investment in this sector. When the municipal waste master plan for Baghdad is eventually implemented, the existing transfer and dump site closed andfor rehabilitated, a treatment facility constructed to serve the Baghdad Medical Complex Center, the potential health and environmental benefits will be enormous.

VI. POTENTIAL RISKS

49. The Bank's Second Interim Strategy highlights the high and unprecedented risks of working in Iraq and the need for flexibility in project design. The table below identifies the main risks posed as well as the mitigation measures to be adopted. Procurement and financial management risks are identified in Annexes 4 and 5 respectively.

Mitigation Measures I Risk Political uncertainty exists. Current security condition is difFicult to work in.

The project has been kept simple. The n u m b e a

Rating

H contracts has been kept to a minimum, and the1 components can be implemented independently of eac4 other. The project components are expected to be implemented through a joint venture of international and local firms, largely without the travel of international staff to Iraq. Iraqi consultants will be hired to the extent possible. Supervision will be undertaken through local staff or consultants. All interactions with Iraqis will respect their security requirements, including maintaining low visibility contacts with the World Bank.

Weak capacity of PMT staff in both Englis H language and computer skills. 1 The revision of the environmental law an regulations may not be adopted.

be an issue if (i) the human capacity to operate th equipment is not available and (ii) the operatin and maintenance costs of the equipment beyon the life of the project are not secured.

Possible difficulty in communication and coordination (both within MOEn, since it is scattered in 3 locations) and with other relevant Ministries (such as Mayorality of Baghdad and Ministry of Health).

Special attention has been devoted in this project to make sure that PMT staft: receives adequate training in both English and computer.

Environmental law mav be difficult to finalize and its

S

I

enactment could take &e. But work on environmental regulations and standards can be achieved even if the

Overall risk

enactment of the law is delayed.

During implementation, special attention will be devoted to train local technicians and experts in the

H

operation of the equipment and to ensure that the1

Risk level: L: Low; M: Medium; S: Substantial;

operating and maintenance costs of the equipment are included the Ministry's budgetary process.

During preparation phase MOEn has been close coordination with Mayorality of Baghdad and the Ministry of Health for the preparation of TORS of component 3. The PMT will have the responsibility of coordination with the different entities for waste management and should alert the team to any potential difficulties before they arise. The possible move of MOEn to one location in the near future will help improve communication within MOEn.

I

3: High

VII. TIMETABLE OF KEY PROJECT EVENTS

50. The proposed schedule is as follows:

........................................................................................................................ ............................. .._..._ (\ ........................................................... ................_... ..................... .;. ...... :::; ;; .... :.:.:.:.:,:.:.:.:.:.:,:,:.~.::::~:j*~:::~::: 2<!3:mz:jj22Es<@f#$pct .......................................................... ~ g ~ ~ $ f ~ ~ l ~ ~ ~ e p ~ ~ ~ $ E j i $ $ $ $ $ $ ~ i .................................

Preparation Mission Concept Review Meeting Quality Enhancement Review Meeting Pre Appraisal Mission Ad Hoc Advisory Committee Meeting Negotiations Approval

':.:':":.:.:.:.:.:'~::::ff f.fffffffff.f.'.'

............................................

- 02/20/2006 - 03/29/2006 - 0513 112006 - 12/07/2006 - 0813 112006 - 09/18/2006 - 09/27/2006

ANNEX 1: MOEN BACKGROUND DESCRIPTION

Organizational Chart of the MOEn 2006

Minister of Environment 4 b Council of Environment

Office of Consultation & Coordination Minister 4

4 v b Deputy Minister, Technical Affairs

- Directorate General of Finance & Admin

Experts

f-

-+

Info Tech

Inspector General

P

International

Center for Radiation Prevention +

Center

Center for Info and Public Awareness

Dept for General Relation

Treaties D e ~ t

*

Sustainable Dev. dmt

+-

Directorate General for Planning & Tech follow-up

f-

Internal Audit Dept

--+

+

Directorate General of Baghdad Environment

P

Legal Dept * Directorate General of Governorate Affairs

ANNEX 1: MOEN BACKGROUND DESCRIPTION contd.

MOEn background in formation

Although the Ministry of Environment in Iraq was established in 2003, the country had a system of environmental governance and monitoring much prior to that. A Human Environment Directorate was set up in 1972 under the Ministry of Health following the UN Conference on Human Environment. An environment law was enacted and an Environment Protection Centre established under the Muustry of Health in 1986. In 1997, this centre was transformed into the Environment Protection and Improvement Directorate (EPID) which by 2001 was vested with broader mandate and greater responsibility for addressing environmental issues. EPID was disassociated from the Ministry of Health and designated as an independent body. The duties of this Directorate were carried out through the Environment Protection and Improvement Council (EPIC), which consisted of government and non-government representatives. The decisions of EPIC required endorsement by the Council of Ministers.

Although technically an independent body, EPID, in reality, continued to depend for its operation on the Ministry of Health. In fact, subsequent to conflicts in 2003, EPID re-integrated with the Ministry of Health for administrative and budgetary convenience. Eventually, in 2003, the Ministry of Environment was created as an independent Ministry by the Coalition Provisional Authority.

Since its creation in 2003, MOEn has been in a state of continual transition, with three Ministers appointed during this short period. Each Minister has reshuffled MOEn's core management team. The latest organization chart given above shows the current structure of MOEn. As evident from the chart, MOEn is organized geographically, thematically and administratively.

MOEn has 14 regional offices - one in each of the governorates, except the autonomous Kurdish region. The head office is in Baghdad, which has the greatest number of staff and expertise. With about 750 staff (of which 350 are professional), human resource is one of MOEn's principal strength. MOEn staffs are technically competent, show a good diversity of technical background, and have received training from several international organizations in the last two years. The Ministry also has a good mix of permanent and contractual staff, and continues to implement national and international projects during this challenging period.

Summary of UNEP9s Institutional Capacity ~ssessmen f' In 2004, UNEP, undertook an Institutional Capacity Assessment of MOEn (hereafter referred to as the assessment). It also upgraded some of MOEn's infrastructure and provided training to its staff. Component 1 of the Emergency Environment Management Project builds on the hdings and recommendations UNEP's Institutional Capacity Assessment.

The assessment reveals that, while working under a state of political flux, security constraints and resource limitations, the Ministry has nevertheless managed to establish its presence, train its staff, improve some of its infrastructure and undertake a few projects. The assessment also reveals that the Ministry currently undertakes all aspects of environmental management: from law making to law enforcement and environmental monitoring. However its core strength is in environmental monitoring, due to its historical background as the monitoring arm of the Ministry of Health. The major challenges are in resource limitation for undertaking inspections and enforcing legislation. It concluded that

UNEP. Institutional Capacig Assessment, Ministry ofErrvironment, Government ofIraq. Draft Report. May 2006.

-18-

strengthening the law making and enforcement and inspection capabilities are areas which need management attention.

The assessment also states that, like in all other areas, the needs in Iraq in the environmental field are enormous. Therefore, there is a need to focus management attention and precious resources on few key areas over the next few years. The assessment found that setting up a process to agree on key national priorities, preparing a national environmental action plan to address these priority areas and executing them as projects would assist the ministry in targeting its resources in such a way that tangible changes could be observed in limited time.

MOEn Mission Statement:

The following is reproduced from the UNEP Institutional Capacity assessment rePo& which summarizes the Mission Statement of MOEn. Although the mission statement is not legally recognized and enforceable, it captures the fundamental intent of the Ministry in its approach to execute its mandate. The draft Mission Statement of the MOEN is:

' T o assure that the people of Iraq and their heirs have a clean and healthfil environment where they may enjoy the resources of the country as those resources were given to them by nature ".

A few elements through which the Mission Statement is proposed to be achieved are;

o The Ministry shall educate the people and industry as to the components of a sound, clean and stable environment. People must respect the environment and can do so only if they are aware that most of their daily actions affects that environment.

o The Ministry shall adopt and maintain a system of environmental laws, regulations and procedures that provides the basis for education of the people and industry as to the proper respect for and use of our natural resource.

o The Ministry shall develop a system of environmental enforcement.

o The Ministry shall advocate and promote programs to develop bio-diversity.

o The Ministry shall prevent hrther degradation of the environment and shall develop and adapt a program to deal with the existing hazardous substance affecting the environment.

N d : Please refer to Annex 4 for Procurement Packages.

Component 1 Strenfihen Environment Mana~ement Capacity of MOEn (i) Preparation of Environment Action Plan and training (ii) Strengthening regulatory function of MOEn

Revising the Law of Environmental Protection and Improvement Preparinglrevising Executive Regulations (ETA, air, water, wastewater, soil quality) Preparing standards and Guidlines (EIA, ambient air and water, emissions etc) Training, workshops and study tours

(iii) Strengthening monitoring and enforcement capacity Preparing inspection manuals and procedures Training for environmental inspectors

(iv) Environmental awareness for school children Purchasing awareness material (leaflets, etc.) for about 50 schools Awareness campaign for school children

Component 2 Develop Capacity in Environmental Monitoring Supply, installation and training 18 air quality monitoring stations (10 Baghdad, 4 M o d , 4 Basra) Purchase of portable water monitoring portable equipment Analysis of water quality data to be published on MOEn's website

Component 3 Strendhen Technical Capacitv in Waste Management Prepare master plan for municipal solid waste management for Baghdad Prepare plans for closure/rehabilitation of 2 existing dump sites Assessment and action plan for healthcare waste management for Baghdad medical complex

Com~onent 4 Establish a Proiect Mana~ement Team Project Management Team (MOEn staff + Consultants) Provide logistical equipment for PMT (computers, furniture, cars, etc.) Supervision Missions and Launch Workshop (7 missions for about 7 staff) Training in Iraq (20 individual training) outside Iraq (15 individual training for a week each) Operating costs (46 months) Translator Financial audit Monitoring and evaluation report

Contingency

Total Project Costs

Project World Bank

900,000 130,000 390,000

200,000

150,000 30,000

2,600,000 2,500,000

90,000 10,000

800,000 400,000 200,000 200,000

400,000 45,000 97,000 98,000 32,000 69,000 19,000 30,000 10,000

300,000

5,000,000

Financing MOEn

(cash /inkind)

50,000

5,000

88,300

500

1,200

145,000

Project Component I Key Indicators

Component 1 Environmental Action Plan

Strengthening the Regulatory Function of MOEn

Monitoring and enforcement capacity

Public awareness for schoolchildren

- Mid Term Indicator: Draft Environment action plan presented to the Council for Environment Consultation and Coordination

- Final Indicator: Draft Action Plan submitted to the Council of Ministers - Mid Term Indicator: Dm13 EIA regulations prepared and presented to the

Council for Environment Consultation and Coordination - Mid-Term: at least 15 MOEn staff trained in ELA. - Final Indicator: Revised Law of Environment Protection and Improvement

presented to the Council for Environment Consultation and Coordination. - Mid-Term Indicator: 20 Environmental inspectors trained - Final Indicator: Inspection Manuals prepared and distributed to 7-10

Ministries. Outcome: 10 Industries inspected according to the new inspection manuals by the end of the project - Mid Term Indicator: environmental awareness material for school children

prepared - Final: environmental awareness tool distributed to 5,000 school children Outcome: 2 schools surveyed for efectiveness of environmental awareness

Component 2

Air quality monitoring

Water quality monitoring

- Final Indicator: 18 air quality monitoring stations installed and functional in three cities

Outcome: Annual Air Quality reportpublished, including data generated by the stations - Final Indicator:6 - 10 portable equipment operational Outcome: MOEn 's website include data on water quality that is accessible and used by researcher and the public

Component 3

Municipal and health care waste management

- Mid Term Indicator: A draft Master Plan for Solid Waste Management for the City of Baghdad prepared.

- Final Indicator: Final Master Plan for Solid Waste Management for Baghdad prepared with detailed Investment Plan

- Final Indicator: Completion of a Health care waste management plan for a selected hospital

Outcome: MOEn staffwith adequate technical capacity to manage municipal and health care waste

ANNEX 4: PROCUREMENT ARRANGEMENTS AND PROCUREMENT PLAN

General

Procurement for the proposed project would be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Creditsyy dated May 2004; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, and the provisions stipulated in the Legal Agreement. The general descriptions of various items under different expenditure categories are described below. For each contract to be financed by the Loadcredit, the different procurement methods or consultant selection methods, the need for prequalification, estimated costs, prior review requirements, and time fiame are agreed between the Borrower and the Bank project team in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

Procurement o f Goods: Goods procured under this project would include office equipment, vehicles, tools for awareness campaign, and for air quality monitoring stations, and portable equipments for water quality monitoring. The procurement will be done using Bank's SBD for all International Competitive Bidding and MIM Bidding documents for National Competitive Bidding and Shopping Method. Specific Software would be procured following Direct Contracting.

Selection o f Consultants: Consultancy services are required fiom firms and individuals in the areas of Waste Management, Environmental Regulations, Strengthening Institutional Capacity of MOEn and project management. Short lists of consultants for services estimated to cost less than US$200,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. There is a potential for universities to be engaged as consultants.

0-peratinn Costs: The Grant will finance expenditures directly related to the management of the project, such as: (i) maintenance of office and IT equipment; (ii) transportation and travel, including per diem allowances for Project staff in travel status; (iii) office supplies, utilities and office administration, including translation, printing and advertising; (iv) fuel costs; (v) communication costs; (vi) costs for production of bidding documents; and (vii) commercial bank charges. No salaries of the Recipient's civil servants will be financed under the project. Operating costs that will be financed by the project will be procured using MOEnYs administrative procedures for shopping satisfactory to the Bank.

Assessment of the agency's capacity to implement procurement

In 2005, the World Bank conducted an Operational Procurement Review (OPR) of the public procurement system in Iraq to help enhance the Bank's lcnowledge of the overall procurement system in Iraq. The OPR revealed that procurement environment which prevailed in Iraq during the last two decades was different fiom the norms of acceptable international practice. The major issue facing public procurement now in Iraq is the uncertainty of public procurement laws and regulations that causes high risk in weak control environment. The risk is essentially rooted in the lack of good laws and regulations, modem standard documentation, lack of trained staff for procurement using Bank guidelines and international sound procurement practice, and poor law enforcement capacity in the country. Presently the Bank is engaged in supporting the Iraqi government in reforming of public procurement system and developing standard national bidding documents in coordination with the Ministry of Planning and Development Cooperation

In addition, an assessment of MOEn's capacity to implement project procurement was conducted in May 2006 by the Bank's local procurement consultant through discussion with MOEn staff in Baghdad before the pre-appraisavappraisal mission and reviewed by the team's Senior Procurement Specialist. The assessment showed that MOEn had been established vide provisional coalition authority memorandum no. (44) issued on November 11, 2003. At present MOEn consists of fifteen Directorates with a workforce of 750 staff, both permanent and contractual, distributed all over the country and there is some management formation in process.

The new established ministry's experience in procurement can be summarized as follows: (a) For procurement of goods: the ministry had carried out 4 local contracts in the value of about US$1.2 million for labs equipments and materials; (b) For procurement of work: one work contract had been carried and it is under implementation in the value of about US$50,000; and (c) for Consultancy services only two contracts for design in the value of US$60,000.

The assessment showed that MOEn has no specialized department for procurement and it implements procurement through its different departments facilitated through the legal department that employs 10 para-legal staff and one lawyer, responsible for advertisement and coordination of procurement activities with different departments. However, MOEn has a centralized bid openings committee and bid evaluation committee with members rotating every 6 months.

Based on the existing information on the overall environment for procurement in Iraq and in particular within MOEn, the overall procurement risk is assessed as high, which therefore requires the assignment of a dedicated and qualified procurement officer to the project, as well as the provision of intensive formal and on-the-job training to the PMT on procurement and project management. In addition, the MIM and PIM are expected to provide significant guidance to PMT procurement staff.

Table 4.1 Procurement Management of Risk

Risks The lack of good laws and regulations, of modem standard documentation, and the habits acquired by procurement staff in the previous era, which will take time to change.

Weakness of procurement staff in using Bank procurement guidelines

Delays in implementing the procurement plan due to lack of experience in procurement planning and implementation

Inability of International Bank procurement sfaff to supenise the in the field.

Weak control environment.

Overall Procurement Risk

Procurement Rating

H

H

H

H

Risks Mitigation Measures

Bank procurement guidelines and the MIM will be followed. The Bank will supervise closely with support from the FMA.

Training on basic procurement is already started and will continue during the project launch workshop as well as during the project implementation. On the job training will be provided. External support on procurement would be provided under the project as needed A Bank local procurement consultant who is based in Baghdad will assist in the procurement supervision. FUA will conduct ex-post procurement reviews and spot physical inspections Lowering threshold for prior review. Frequent review of files by the FMA as well as spot physical inspection by the FMA. Close monitoring of corruption indicators in procurement and implementation.

Procurement Arrangement by Components

- Component 1, Strengthen Institutional and Regulatoly Functions of MOEn: A consulting firm and individual consultants will be hired for technical assistance. NCB and shopping will be used for purchasing training and awareness material.

- Component 2, Develop Capacity in Environmental Monitoring: There will be an ICB Package and shopping for equipment. Individual consultants will be hired for training/workshops.

- Component 3. Strengthen Technical Capacity in Waste Management: The same firm hired for component 1, and individual consultants will be hired for strengthening technical capacity.

- Component 4, Establish a Project Management Team: Individual consultants will be hired for various technical support. Shopping will be used to purchase office equipment and cars.

Frequency of Procurement Supervision

Based on the capacity assessment of MOEn, at least one supervision mission is planned every four months, in addition to the prior review supervision to be carried out from Bank offices, to ensure that MOEn is following the Procurement guidelines and procedures during implementation. Until security conditions make travel to Iraq possible for international Bank staff, the Bank will use the services of a Fiduciary Monitoring Agent (FMA). The FMA is an independent firm that operates within Iraq; it will support the Bank in carrying out its supervision function, including spot physical inspection. In addition, the Bank will rely on reports from the local World Bank procurement consultant based in Iraq. During the interim period, Bank staff and the concerned Iraqi procurement staff will meet outside Iraq to carry out off-site supervision. They will also rely on regular audio conference to maintain effective communication on the progress of the project.

Recommendations and Action Plan to Build the Agencies Capacity

A procurement officer was assigned to the PMT to be responsible for all procurement aspects during implementation. This officer will receive both formal and ad-hoc procurement training on efficient handling of the procurement activities under the project;. Training sessions will be organized throughout project implementation. The target audience is PMT staff, and other employees of the MOEn involved in procurement; A PIM will be prepared on the basis of the MIM to provide standard procurement documents, evaluation reports, progress reports, filing requirements that will be followed throughout project implementation; The thresholds for prior review by the Bank are set at a low level, to allow Bank staff to provide hands-on training to staff of the PMT;

0 A Project Launch Workshop, attended by all project stakeholders, will be held in Arabic (or with Arabic translation) soon after Grant signing.

Procurement Plan MOEn at pre-appraisal developed a Procurement Plan for project implementation which provides the basis for the procurement methods. This plan has been agreed between the MOEn and the Project Team at negotiations and is available below. It will also be available in the Project's database and in the Bank's external website. The Procurement Plan will be updated in agreement with the PMT annually, or as required, to reflect the actual project implementation needs and improvements in institutional capacity.

A. Financial Mana~ement

FM Assessment

An assessment of the financial management (FM) arrangements at MOEn and those proposed for the project was completed, remotely, during meetings in Beinrt, Lebanon. The purpose of the assessment was to determine whether these arrangements were acceptable to the Bank in providing reasonable fiduciary assurance that the proceeds of the Grant are used for the purposes of the project with due regard to economy, efficiency. The documentation of the assessment is available in the project files.

Based on the result of the assessment, the FM risk, as a component of the fiduciary risk, and which is a combination of country, sector and project specific factors is high. In light of the Bank Second Interim Strategy Note covering ITF and IDA-financed projects executed by the Iraqi Government, the project financial resources, extended through the Grant, will be managed through the framework of MOEn financial systems, regulations, and controls. Consequently, a number of measures will be introduced to mitigate the weaknesses identified. Paragraph 5 below reflects a summary of the MOEn FM arrangements reviewed.

Country FMRisk

A Country Financial Accountability Assessment (CFAA) has not yet been undertaken for Iraq; however, Iraq has been defined as one of the "high risk-weak control environment countries" that requires special attention, from the Bank, at various levels. Major reasons for this categorization are the impact of the security conditions and years of isolation, the weaknesses of the public FM system, the inefficiencies of the banking system, the very low ranking in the Corruption Perception Index for 2005, and the various reports issued by independent auditors and other donors, including the International Monetary Fund- World Bank April 2005 report on Iraq Public Financial ~ a n a ~ e m e n t ~ .

Project FM Risk: The most recognized risks are:

guidelines and requirements.

Limitation of the accounting (including fixed assets 1 H I management system) and report in^ systems of I I

year audit, thus, not having timely assurance I I

timily and comprehens&e-information. Delay in having the auditor on board for each fiscal

Mitigating Measure The use of a PMT, with a competent FO on board, using a procedure manual (F'IM) based on the MIM, frequent training, close monitoring by the FMA. Padlel accounting records, fixed assets (equipment and vehicles purchased by the

H project) register, and reporting requirements. Closely monitor the auditor selection process and remind the PMT of due dates.

information to make decisions. Limited flow of information between various MOEn I H I MOEn to take action if this would affect the departments and PMT staff due to having the MOEn I / efficiency of any project process. buildings in different areas. 1 " ~ - ~ ~ -

I Overall R M Risk I I

H I H = High Risk; S = Substantial Risk; M =Modest Risk; N = Low or Negligible Risk

Enhancing Sound PFM-Short- to Medium-Term Reforms.

MOEn - FMArrangements Backgrounds

MOEn exists in 14 governorates, in addition to Baghdad. The MOEn follows the central accounting system that is financed through budget allocations from MOF. There is a Directorate General of Finance and Administration (DG) and an Internal Control Department within the MOEn. The Finance Unit within the DG has: Budget, Accounting, Expenditures, Revenues, Public Debt and Monitoring sections. The Internal Control Department is responsible for ex-ante and post audit of expenditures, performance of periodical banking and advances reconciliations, periodical stock-taking, and review of reports before submission to MOF. A combination of the Financial and Internal Control verification ensures the regularity of payments, compliance with the applicable rules, allocation within the budget, and existence of proper signature before disbursement or replenishment of advances. The Inspector General has an active role in MOEn in establishing an independent system responsible for execution, adaptation of riles deterring financial fraud and corruption. MOEn has one Iraqi Dinars current account in Rafidain Bank.

Project F&f Arrangements

Internal Control:

Stafing: The Project Management Team (PMT) is supported by an experienced Financial Officer (FO) who will undertake the responsibilities of maintaining financial records including contracts' payments, ensuring timely payments authorization, submitting withdrawal applications to the Bank, and preparing periodic reports and financial statements.

Clear Documented Procedures: The PMT will draft and use a Project Implementation Manual (PIM) based on the Master Implementation Manual (MIM) prepared for all Bank projects implemented in Iraq. The manual will clearly disclose each PMT member job description, the payment verification, authorization and execution processes, authority limits, as well as physical control of assets.

Funds Flow

E-mail Notification of Disbursement

MOPDC a

Flow of documents ____+ Flow of Funds b and Information

1

Budgeting: The PMT will maintain a project budget and detailed disbursement plan per quarter. This plan was developed based on the initial procurement plan and estimated payments cycles, and will be revised upon need. It will be used as a monitoring tool to analyze budget variances and manage cash.

~ r m t Account

- - - - - - - - - - - - - - - Request Payment

Reimbursements

b MOEnPMT Proiect Account

Direct Pavment

Consultants

Accounting: Based on the number of the contracts the frequency of payments, spreadsheet applications will be used to record the project's financial transactions and generate reports. Procedures for protecting the data and preventing losses will be maintained.

Financial Reporting: The PMT will be responsible for preparing the following: o Quarterly Interim financial reports/Financial Monitoring Reports (FMRs) and submitting them

with the quarterly progress reports to the Bank within 45 days from the quarter then ended. The format of the reports was agreed on and included in the project files. These reports consist of a statement of sources and uses of hnds by component; statement of uses of funds by category of expenditure; both comparing actual and planned expenditures; and list of contracts' commitments.

o Annually Project Financial Statements (PFS), and submitting an audited PFS with the independent auditor opinion having to the Bank not later than six months after the end of each fiscal year. The PFS include: (i) statement of sources and uses of h d s by component, (ii) statement of uses of funds by category of expenditures; and (iii) list of contracts' commitments.

Auditing Arrangements: An external independent auditor acceptable to the Bank and with international experience will be engaged to carry out the project audit in accordance with international standards of auditing, issue the required independent opinion, and prepare the management letter. The audit TORS include performing an SOE review for the audit period covered. The audit report and management letter will be submitted by the PMT to the Bank not later than six months after the end of each fiscal year. An escrow account will be used to pay the auditor after the project's closing date.

Fiduciary Monitoring Agent m): The Bank has engaged an independent firm that will operate in Iraq as FMA for ITF-financed projects. The FMA staff will be granted regular access to the project documents and sites by MOEn. This FMA has dual roles:

- Verifying and validating to the Bank the projects' financial management and procurement arrangements and internal controls agreed upon with the implementing agencies.

- Providing advisory services and technical support to the Iraqi government and the ITF-financed projects relating to the projects' financial management and procurement arrangements and the generation of periodical and reliable financial reports.

The FMA has already been carrying its responsibilities in all current ITF-financed projects and generating useful reports.

Bank Financial Management Supervision: Where security conditions make travel to Iraq impossible for Bank staff' supervision missions will be undertaken remotely from alternative location. Close monitoring of financial management arrangements will be conducted through out the project life. Supervision during the first year will be conducted every 4 months. The FO will get an intensive training on FM arrangements during the project launch workshop and will also attend all the capacity building workshops conducted by the Bank for all projects.

FM Action Plan

Open the current account to be used by PMT for small payments Pm and for receiving Bank reimbursements Complete the financial chapter of the Project Implementation PMT Manual (PIM) Start the external auditor selection process PMT

November 30,2006

January 3 1,2007

December 1,2006

B. Disbursement Arrangements

The Bank's strategy in Iraq is to implement projects through the Iraqi Ministries (rather than through project implementation units outside Government structures), ensuring that appropriate and effective financial controls are in place over the use of funds provided by the Bank, while at the same time working together to strengthen the Ministries' own financial control processes and procedures. Taking into consideration the high risk environment assessed for the project, including the assessed high financial management risk, the disbursement arrangements will compensate by continuing to use conservative disbursement methods, namely:

(i) Direct Payments to suppliers and consultants for eligible expenditures for disbursements over uS$20,000.

(ii) Reimbursement to MOEn for eligible expenditures under US$20,000 paid fiom the MOEn resources.

(iii) Special Commitments to a commercial bank to reimburse to the commercial bank payments made to a supplier against Letters of Credit issued at the request of MOEn for eligible expenditures.

These are the disbursement methods that have been used in the existing World Bank ITF projects currently under implementation and which have proven to be effective. Extensive training will be provided to the PMT on the Bank's disbursement procedures. Supporting documentation, e.g., copies of invoices and receipts, is required to be provided with all requests to disburse funds. The original copies of the supporting documentation will be maintained by MOEn and made available for review by Bank representatives upon request.

The agreements with the Donors to the World Bank ITF allow for the financing of 100 percent of project expenditures. MOEn would contribute implementation support, including the assignment of MOEn staff to the PMT and some related operating expenses. The allocation of the proceeds of the Grant by expenditure category is as follows:

Table 5.1 Allocation of Grant Proceeds

Table 5.2 : Disbursement Schedule (US$ million)

(1) (2) (3) (4)

FISCALYEAR j FY07 ........................................................ Absolute 0.1 <.............<...-...<.-..-.... -,,; .......

% of Expenditures to be Financed

100% 100% 100%

Category

Goods Consultancy Services1 Training Operating Cost UnallocatedJContingency Total

I Cumulative 0.1 1.9

Amount of Grant Allocated (expressed in US$ equivalent)

2,840,000 1,650,000

210,000 300,000

5,000,000

FY08

1.8

CALENDARYEAR ] 2006 ........................................................ Absolute i 0.01 .......... " .................... ",* ........................

Cumulative ? 0.01

Fiscal Years: refer to years starting July 1 and ending June 30. 3.8

FY09

1.9

2007

0.6

0.6

4.8

FY 10

1.0

5.0

2008

2.9

3.5

FYll

0.2

2009

1.1

4.6

2010

0.4

5.0

A. Air Qualitv

Air quality in many areas of Iraq deteriorated significantly following the first Gulf War in 1991 with fires engulfing petroleum refineries and &el reservoirs for days together. In addition, the prolonged use of low quality fuel in the transport and industrial sectors has adversely impacted the air quality. The situation has been aggravated by the sanctions imposed on the country and the associated shortage in supplies and equipments for industrial emission control and vehicle maintenance. Moreover, the government of Iraq has not undertaken reforestation activities or taken initiative for maintenance of green belts.

In terms of air quality monitoring, the MOEn has a very limited number of equipment. The existing human capacity for air quality monitoring is inadequate. Existing data on air quality are limited but can provide a general view on issues of concern, in general, and the cities of Baghdad, Basra, and Mosul, in particular. Moreover, simulation studies conducted using the load of various emissions from fixed and mobile sources also provide insight into the current status of air quality.

Effect on Public Health: The poor quality of air has negative impact on public health. High Particulate Matter (PM) levels results in irritation or damage to lungs and increases surf$ce area for adsorbing chemical pollutants. Also, materials made of stone and concrete suffer discoloration, metals are tarnished and ceramic and glasses are eroded. High levels of lead interfere with normal red blood cell formation, affects cell metabolism, and affects fetuses and small children delaying mental and physical development. Nitrogen dioxide and sulfur dioxide causes mucous membrane irritation and respiratory infection, including problems such as emphysema and broncho-constrictions. These also contribute to acid rain formation, erosion of materials, corrosion, etc. These impacts are associated with considerable economic cost to the society, although costs are hard to quantify.

Measurement of air quality will enable MOEn to assess the deterioration currently occurring and devise policy response to arrest the decline. The database will be an important input to policy debates and will serve as public evidence supporting the need for any regulatory policies. As for example, current studies indicate that land transport sector possibly contributes to more than 90% of the total emissions, including 60-75% of PM levels in the cities. Any regulations controlling transportation sector will be unpopular unless it is backed by credible evidence and adequate public awareness created over time.

Mobile source emissions: The transport sector presents an important source of emissions in Iraqi cities, particularly Baghdad, Basra and Mosul. The absence of an adequate public transport system, the poor conditions of the road infrastructure, the lack of pedestrian zones, the high reliance on personal cars, and the aged vehicle fleet operating on low quality leaded and diesel fuel with no regular inspection and maintenance are all factors contributing to increased emissions from mobile sources. Vehicle-induced emissions include Carbon Monoxide (CO), Nitrogen Oxide (NOx), Sulfur Dioxide (SOz), Volatile Organic Chemicals (VOCs), PM, lead (Pb), and others. Detailed information about the transport sector status in the three Iraqi pilot cities, including vehicle fleet size, level of vehicle ownership, fleet distribution, fleet age, fuel consumption, etc. is generally lacking or limited at best.

Fixed sources of emissions: Industrial facilities represent the major fixed emission sources in Baghdad, Basra, and Mosul. Emitting industries include power stations, petroleum refineries, chemical production, brick kilns, smelting of lead and aluminum (including small informal production), textiles, tanneries, asphalt production, welding shops, metal working, soils and cleaning products, grainlflour mills, and bakery products. Most industries have no emission control measures. In the best of cases, they have elevated stacks for emission dispersion.

An equally important source of emissions in Iraq is the continual bum-off or flaring of excess natural gas at oil fields leading to potential high levels of nitrogen oxides and other constituents (sulfur dioxide, carbon dioxide, etc.) depending on the quality of the gas flared. Other fixed emission sources include construction activities (dust and PM), wastewater treatment plants [methane (CW) hydrogen sulfide (H2S) mercaptans, etc.], solid waste handling and disposal facilities (HZS, CW, mercaptans, ammonia, etc.), and improperly operated hospital incinerators.

Air Quality Indicators: In the past two decades, air quality monitoring in Iraq has been limited and intermittent, mainly focused on Baghdad, thus constraining the ability to evaluate the air quality situation in the country in a comprehensive manner. In the 1980s, the Air Quality Section, under the Directorate of Environmental Protection and Improvement of the Ministry of Health, monitored air quality in Baghdad using four fixed air quality monitoring stations and one mobile air quality laboratory for the various districts. High Volume Samplers were also used to collect filter samples for PM analysis as well as Atomic Absorption Spectroscopy analysis to trace heavy metals (Fe, Cu, Zn, Mn, Pb, Cr, Cd and Hg). Levels of SO2, CO, and NOx were measured using commonly available instruments. At the end of the 1980s, the measuring equipment became non-operational due to shortage of spare parts and lack of technical expertise to maintain them. The High Volume Samplers remained the only operational equipment due to their ease of maintenance.

PM, C O and SOz: Between 1998 and 2002, air quality monitoring for CO and SO2 in Baghdad was resumed using equipment provided by the WHO. Limited equipment were installed only at two locations. The program was followed up diligently. After the war in 2003, air quality monitoring was conducted in Baghdad by the newly established MOEn using available equipment, including two CO analyzers, two SO2 analyzers, and five High Volume Samplers (MOEn, 2006). In other governorates, no complete air quality monitoring program existed. Measurements were restricted to monthly levels of settling dust. Limited data from available monitoring activities are presented in Table 6.1 below and compared to WHO standards.

Table 6.1. Concentntion of PM, CO, & SO2 in Baghdad for the years 1998 to 2005 (MOEn, 2006)

As seen from the above table, average PM levels are 5 to 16 higher than WHO standards. There is substantial research evidence that PM is the air pollutant that has shown the strongest health impacts.

Lead Concentration: An unpublished study by the Iraqi MOEn monitored lead concentrations intermittently in five health facilities in Baghdad, during the years 2000-2001 (Table 6.2). Measurements

show wide variations that cannot be reasonably interpreted, particularly in the absence of meteorological data. Most values exceed the 1 pglm3 standard set by the WHO.

Table 6.2. Mean monthly ambient lead concentrations in Baghdad City (MOEn, 2005)

Finally, a study conducted by Tebodin B.V. (2004) assessed air quality in the cities of Baghdad, Basra and Mosul, by using a Decision Support System (DSS), estimating the load of various indicators emitted by fixed and mobile sources that are expected to affect air quality in these urban areas. The study concluded that environmental management of air pollution caused by t r a c in urban areas, should become a matter of prime concern in Iraq. While these problems exist in other large cities in the world, impacts are somewhat worse in Iraq in comparison to similar cities in the region because of the state onad age of the existing vehicles and the road and the quality of fuels with relatively elevated levels of leas and sulfur.

Month August September October November December

January

B. Water Quality

Rapidly declining water quality is leading to health issues as well as to rising costs for water supply, increased salinization of agricultural lands and to negative impacts on ecosystems. The most urgent pollution problems can be categorized as being caused by three issues:

- Untreated sewage water is reportedly discharged into rivers at a rate of one million tons a day. Wastewater treatment plants, in serious need of rehabilitation, often treat both domestic and industrial waste. Many treatment plants are only partially operational or not operational at all, releasing raw sewage to rivers.

Number of readings 11 11 7 4 2 3

- Agricultural salinity and the fertilizer industry are major causes for concern. Salinity has been an issue in Iraq for centuries, but more recently the excessive use of fertilizers has been a major cause of pollution.

Annual Mean WHO Standard

- Manufacturing industries, in particular for metal plating and other metal product treatments are causing significant heavy metal and persistent organic pollutant problems.

Mean monthly ambient lead concentrations (pgIm3)

According to the Decision Support System for pollution control monitoring 7, there are substantial amounts of data available on water quality but this is largely fragmented and inconsistent. The responsibility for water quality monitoring is shared between MOEn, the Ministry of Water Resources, and the Ministry of Municipalities and Public Works, without clear demarcation of roles and mandates.

Al Alouiya

6.6 1.3 2.1 9.8 2.7 5.1 4.6 1

7 Tebodin B.V., 2004: Environmental Pollution in Iraq, Assessment and Abatement Strategy Note. Decision Support System for Integrated Pollution Control Modeling in Iraq. Report prepared for the World Bank, December 2004

-32-

A1 Habibiya

1.6 2.5 0.2 33.1 0.7 3.9 7 1

A1 Iskan

0.4 0.7 1.8 1.5 2.7 2.4 1.5 1

Al Kazimiya

0.5 0.6 3.3 1.8 0 0 1 1

Sadr Al Kanat 0.3 0.8 18.8 1.3 0.2 18.7 6.6 1

Current World Bank activities in the water sector in Iraq include the preparation of an interim Water Country Assistance Strategy and the following projects funded by the ITF: Emergency Water, Sanitation and Urban Reconstruction (P087912), the Emergency Baghdad Water Supply and Sanitation (P087910) and the Emergency Community Infrastructure and Rehabilitation Project (P087881). The Bank is also in the process of preparing two IDA projects on water: the Second Emergency Water Supply and Sanitation (P094650) and Second Emergency Baghdad Water Supply and Sanitation (P094649).

In addition, donors are becoming increasingly active in the water sector. USAID is funding an all- comprehensive water master plan, 'Strategic Vision for Management of Iraq 's Water Resources '. WHO recently purchased water quality control laboratories to MOEn and the Ministry of Municipalities and Public Works. Over 400 laboratory technicians fiom both Ministries were trained in water quality control techniques. Numerous donors are undertalung infrastructure rehabilitation projects for dnniung water supply and sanitation in Baghdad and various governorates (e.g., USAID, DFID); for capacity building for water institutions (UNESCO); for a water training centre in Basra (DFID); for irrigation water supply, drainage and rehabilitation of pumping stations (FAO). As mentioned in the previous section, UNEP is supporting environmental governance through assessment and capacity building and is also supporting a environmentally sound technologies for the Marshlands - including drinking water and sanitation.

C. Waste Mana~ement

There are two primary sources of wastes in Baghdad that this project addresses - the Municipal Waste fiom community and the Healthcare wastes fiom the hospitals.

Municipal Waste

The estimated population of Baghdad is about 5 million. The amount of municipal solid waste (MSW) reaching the dump sites is about 8,000 m3* per day in Baghdad. This amount does not include the waste in some sectors which cannot be reached because of the security situation. Prior to the conflicts, Iraq's main cities had efficient collection systems, transfer stations, and basic landfills for final disposal on the perimeter of the cities. However, since the conflicts and UN sanctions, waste collection and disposal have been significantly reduced. More than two-thirds of the domestic wastes are not being collected and safely disposed. Waste is only collected fiom wealthy residential areas and governmental buildings (as high as once per day to once every 1-2 weeks, depending on the security situation), with the remaining population carrying waste by hand to informal dump sites within the city. Rural communities dispose and bum their wastes in deserted areas or village dumps

The current services for the collection and disposal of municipal waste in Baghdad are characterized by: - Lack of appropriate policies, institutional and legal framework for the whole chain of municipal

waste management services; - Absence or weakly functioning systems for the collection, transfer, treatment and disposal of all

types of wastes, including municipal, hazardous and non-hazardous healthcare and industrial wastes;

- Risks to human health from accumulations of municipal, industrial, demolition and healthcare wastes in residential areas;

- Health and environmental risks from uncontrolled dump sites; - Lack of environmental standards; and - Lack of capacities and resources to operate the sites in a controlled manner.

Mayorality of Baghdad Survey

The existing disposal sites serving Baghdad are as follow: - A USAID-funded, newly constructed, 20-acre, 70% completed sanitary landfill in Al-Buatha

(Dora quarter), which is not used yet because of security concerns, as well as lack of capacity to operate it;

- Al-Amari dump site which consists of four different uncontrolled dump sites: old el Amari and Al-Baweya (which are no longer in use) and two sites facing each other near the Baghdad thermo-stone production factory. The majority of wastes from Baghdad reach the two sites nearby the thermo-stone factory since they are the closest (10 Krn) from the city of Baghdad.

- Al-Haswa dump site in Abu-Ghreib quarter, which receives small quantities of waste due to the unsecured route to the site. The waste amount is 500,000 cubic meter

- Al-Arkeia and Fadei aumping site in Al-Taji quarter, which used to be a quarry site. - Al Sabiyat dumping site in the Al-Taji quarter which were used before as transfer stationslsites

The proposed project will study the rehabilitation and or closure of the two priority dumping sites of old el Arnari and a1 Sabiyat.

Healthcare Waste

In Baghdad, there are 41 government hospitals containing about 11,200 beds and producing health care waste of about 3,800 t/year. There is limited information available on the characteristics, composition, quantities, methods and technologies for segregation, collection and disposal of hazardous and non- hazardous healthcare wastes (HCW). It has been reported that HCW is either co-disposed with MSW in uncontrolled dump sites, or burnt in crude incinerators, causing significant health and environmental concerns. This is mainly due to the lack of capacities and systems in medical establishments in managing HCW, the limited availability of poorly operated treatment facilities on site, as well as the non-existence of off-site HCW management systems in collection, and final treatment and disposal of HCW

In particular, the Baghdad Medical Complex Center (BMCC) is the largest medical center in the city, with 2,500 beds. It consists of 12 medical institutions which include six hospitals, one central laboratory, a cardiology, blood-bank, radiation and dentistry centers. The proposed project aims at preparing an assessment and action plan to improve health care waste management in the BMCC and Al-Yarmouk Hospital and stimulate future investment. This will be jointly coordinated with the Ministry of the Environment and the Ministry of Health.

ANNEX 7: NAME OF STAFF AND CONSULTANTS WHO WORKED ON PROJECT

The team composition is provided below:

ANNEX 8: DOCUMENTS IN THE PROJECT FILE

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$ U j ~ @ $ ~ ~ ~ ~ 5 MNSRE MNSR-F MNSAP MNSRE MNSRE MNAPR MNAPR MNAFM LEGMS LEGMS MNSRE

....................................................................................................................

;; ... ;N$&gi:$ gj:$ $ ~ ~ ~ ~ ~ ~ ~ 1 p ~ @ Maria Sarraf Sherif Kame1 F. Arif Ellysar Baroudy Manish Kumar Ahmed %sled Mostafa Nazaneen Ali Velayutham Vijayaverl Mona El-Charni Hiroko Imamura Vikram Raghavan Syviengxay Creger

. . .

$Up=, 163235 2 1236

263 165 275275 76127 1 2753 89

19 165 265283

12846

................................................................................................................................................. . . . . .

~ T ~ ~ ~ ~ ~ ~ ~ ~ @ @ : $ @ ~ $ ~ $ ~ @ $m@gzG. ...............................................................................................................................................................................................................................................

Task Team Leader Regional Env. and Safeguards Advisor Environment Specialist Institutional Specialist (Consultant) Solid waste Specialist Procurement Specialist Sr. Procurement Specialist Financial Management Specialist Sr. Counsel Counsel Language Program Assistant