NDF - Financing for climate change and development projects

Lao PDR Road Sector Project II [NDF C92/C93]

Photo: Asian Development Bank, Creative Commons, https://bit.ly/2dsQEu6
Photo: Asian Development Bank, Creative Commons
5.10.2016
The general program objectives to which NDF funding will contribute are: (i) improved climate-resilient road connectivity in selected provinces; and (ii) strengthened climate-resilient and efficient road asset management practices at national and provincial levels.

Lao PDR
Lao PDR Road Sector Project II
Ref. NDF C92/C93

NDF Finance: EUR 11 million (EUR 5 million as grant, EUR 6 million as a loan)
Project Period: 2016 - 2022
Partner Agency: World Bank
Executing Agency: Ministry of Public Works and Transport

Objective
The overall project development objective is to improve climate-resilient road connectivity in selected provinces in Lao PDR. Being a land-locked country, the transport sector in Lao PDR is dominated by the road sector. The road network is highly susceptible to climate change impacts and the risk increases considerably under current climate change projections. The local transport infrastructure is particularly vulnerable to this threat as a result of generally low standards, lack of adequate maintenance, and technical designs that have not accounted for increased climate variability. The growing impacts of natural disasters have increased the pressures on the emergency repair budget. The importance of increased climate-resilience for roads is now recognised by the government as a potentially significant factor in reducing the demand for emergency and repairs, spot improvements and periodical repairs, thereby easing the pressure on the budget.

At the institutional level, the sector faces important capacity gaps for effective sector financing, strategic planning, and the management of road assets resilient to climate change. Road maintenance and rehabilitation responsibility for provincial roads has been delegated to provincial governments, which need significant support to build capacity to manage this task properly. National roads are managed at the national level; also here the need for capacity building is great.

This project builds on the openly demonstrated proactive approach of Lao PDR in the climate change area. It is also a direct response to identified needs and priorities, and it will enable an effective utilisation of NDF's road transport experience gathered from the region and from other continents. The general program objectives to which NDF funding will contribute are: (i) improved climate-resilient road connectivity in selected provinces; and (ii) strengthened climate-resilient and efficient road asset management practices at national and provincial levels.

The following outcomes are expected:

  • Provincial roads in the selected provinces are in good or fair condition, and more resilient to forecasted climate impacts over the coming ten-year period;
  • Strengthened capacity in the road sector in terms of prioritising, designing and contracting for climate-resilient road maintenance;
  • Increased focus on climate-resilience in the transport sector, including through the development of a transport sector climate change action plan.

 

Financing

EUR 11 million (EUR 5 million as a grant, EUR 6 million as a loan).

NDF Contact

Procurement Specialist Erik Holmqvist
Telephone +358 10 618 002

More information

Proposal for Final Consideration NDF C92/C93