Second Central Asia Regional Economic Cooperation Corridor 2 Road Investment Program

Project readiness challenges could result in sequential delays of the different tranches in an MFF, leaving insufficient time for implementation within the MFF term and making MFF less relevant. Prior to the approval of each tranche, the initial design for each project was prepared to varying degrees. However, all three tranche projects were subject to design updates during implementation for a variety of reasons,including adjustments to the procurement approach after the contract termination with the initial contractor for Project 1; cancellation of the original civil works under Project 2 because of the unforeseen railway development; and the transition of the executing agency to the Committee for Roads and sharp devaluation of the sum for Project 3. While design readiness in terms of its entirety should be further ensured prior to project approval, utilizing project readiness mechanisms including the project readiness facility or small expenditure financing facility, future project implementation schedules should also account for the challenges experienced and time required for developing a design and approving changes when necessary,which will involve multiple ministries and experts outside of the executing agency. If such challenges are inherent, they would result in a sequential delay of another tranche in an MFF, leaving insufficient time for implementation within the MFF term and making MFF less relevant.