| Project Detail |
The present Project, US$200 million to support the State of Mato Grosso do Sul (SMS), is Phase 4 of the Brazil Proactive, Safe and Resilient Road Asset Management Program – Brazil Pro-Roads, a horizontal and simultaneous multi-phase programmatic approach. The SMS, created in 1979, has recently emerged as an important player in Brazil’s economy and in the global food security agenda. The SMS economy has successfully transitioned from extensive agriculture towards the development of intensive agro-industries in the last decade. Given the size of the State (6th largest in Brazil) and the fact that its production is highly dependent on logistics, road transport is essential in much of the SMS territory. However, the State’s road infrastructure is vulnerable to significant risks stemming from climate hazards, including flooding and increasing occurrence of heat waves. This vulnerability is exacerbated in a context where more than 65 percent of the state road network is unpaved and hence, particularly exposed to climate impacts. This Phase 4 Project will support SMS’s objective of transforming and modernizing road asset management practices towards proactive climate resilience, by using the long-term Design-Build-Maintain (DBM) CREMA model. The Project will also support the first 20-to-25 year pilot CREMA PPP in the State, leveraging the positive results of the State’s ambitious plan to develop its road infrastructure by mobilizing a combination of public financing and private capital and the robust regulatory, institutional and operational frameworks the SMS has already developed. The delegation of road infrastructure management to the private sector, combined with targeted resilience works, will increase the overall resilience of the transport network to the impacts of climate change. It will also improve road safety. The SMS will both benefit from and contribute to the MPA learning agenda, which aims at improving the technical and institutional capacity of the States in the use of CREMAs. Phase 4 consists of four components for a total estimated value of US$350 million. This includes US$200 million of IBRD financing; US$50 million of counterpart financing from SMS, mainly dedicated to the development of CREMA; and an estimated US$100 million in private capital mobilization (PCM) Component 1 aims to build adaptive capacity in SMS and includes targeted measures to ensure the resilience of the road network to the expected effects of climate change. The rehabilitation works and resilience improvements will be designed to withstand the expected intensification of weather events. Subcomponent 1.1 will include contracting and carrying out the design, rehabilitation and maintenance of selected State roads through CREMA-DBM Agreements, contracts with a duration ranging from 8 to 10 years, through public procurement. Those CREMAs will cover 617 km of state roads in two regions prioritized by the Government of Mato Grosso do Sul. Subcomponent 1.2 will include technical assistance in the structuring (including financial and economic aspects) of, and support to contracting and implementing CREMA-PPP Agreements with a duration of 10 to 35 years, paid through availability payment scheme, for the design, rehabilitation and maintenance of selected State roads. A logistics corridor serving agro-industrial production (especially cellulose) from the eastern region of SMS to the states of Minas Gerais and Goiás has been identified as a relevant candidate, covering an estimated length of 208 km. Component 2 will consist of technical assistance and studies, training, and the acquisition of goods to build the capacity of selected State agencies, including EPE, SEILOG, AGESUL, IMASUL, DETRAN and CGE, on climate-resilient road asset management, decarbonization and road safety. Component 3 will finance road safety and accessibility improvements to hazardous spots around selected State public schools. At least 30 critical and hazardous spots near 24 state schools are expected to be treated. Component 4 will provide the implementing agency State’s Partnership Office, EPE, with support to the implementation, management and coordination of the Project, including technical, financial, audit, procurement, monitoring and evaluation, social and environmental aspects The proposed Phase 4 Project interventions will directly benefit 1.55 million by integrating climate-resilient and disaster risk management systems into road design, thereby reducing the vulnerability of the infrastructure to climate events, and will support the SMS’s commitment to preserving its biodiversity, especially in the Pantanal, the biome with the highest number of protected species in Brazil by contributing to increasing technical knowledge and understanding of risks and disaster risk management at the State level in the context of climate change. Improve access to sustainable, safe, and resilient transport in the State of Mato Grosso do Sul. |
