Minister, Ladies and Gentlemen, Colleagues The World Bank has a long history of successful collaboration with the Government of Albania and welcomes the commitment of the Government of Albania to both reform the General Road Directorate and to improve the standard of the Secondary and Local Roads Network. GRD Reform
Reform of the General Road Directorate is long overdue if Albania is going to ensure both the sustainability of the significant investment in the primary and secondary road network up to this point, and more importantly ensure the provision of an effective road system that contributes fully to the economic development of the country. The establishment of a professionally managed road authority requires careful planning and implementation. The organization needs autonomy to plan and undertake its responsibilities; it needs autonomy in its human resource policy, to pay wages that are competitive with the private sector to ensure that it can attract good quality staff, and most importantly, it needs sufficient financial resources to ensure that it can fulfill its mandate. The passage of the Council of Ministers Decision, confirming the structure and proposed reform path, represents a substantive first step on the difficult road, and the World Bank together with our donor partners, looks forward to working with the Government to implement these essential and long overdue reforms. Secondary and Local Roads Project
In respect of the plans of the Government on Secondary and Local Roads, a recent survey, noted that, after employment and income, the majority of rural respondents considered infrastructure problems to be the main barrier to improving their low standard of living. Forty-nine (49) percent of rural producers have stated that the lack of a good road represents their biggest marketing problem.
Rural inhabitants have also acknowledged that poor road access makes it difficult to reach markets, contributes to migration to urban areas, and inhibits the delivery of health and education services .
The problems facing the regional and local road network have been summarized in a number of recent Bank Studies , : Only 39 percent of the local road network is paved, the lowest in the region, and 95 percent is reported to be in a poor or very poor condition – with a number of sections impassable for much of the year. Only 1-5 farmers actually sell anything that they produce – and then less than 10% of the total produced – essentially most agriculture in Albania is subsistence in nature. And improving rural roads reduced transport costs by 80 percent and allowed farmers to increase their production by 50 percent. The Agricultural sector contributes a significant share of GDP in Albania, but could be much more important. The proposed World Bank/OFID project will have three main components: (i) The improvement of priority sections of the regional road network; (ii) the improvement of priority sections of the local (commune) road network; and (iii) implementation assistance and institutional support to improve the management and financing of both networks. The provisional expectation is that the total program will encompass between 1,000 – 1,500 km of regional and local roads, implying a total program cost of approximately US$ 200-400 million.
The World Bank contribution is a US$20 million IDA credit this year, with USD15 million co-financing from the OFID, and considerable parallel financing has been discussed, and provisionally agreed in some cases, with a number of other international financing institutions. The WB/OFID project will fund the position of an international technical assistance in ADF, and a firm of international consultants to supervise the entire program – including all the donor contributions.
This project represents a substantive first step to placing the management and financing of the regional and local road network on a sustainable basis for the future and making a real impact on the quality of lives of rural inhabitants, and we look forward to working with the Government and all participating donors to implement this important project.
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