Although the final cost of the project was much higher than the appraisal estimate, the increase was largely due to the unrealistic cost estimate at the feasibility study stage, which is evident even when other factors, such as price increase of construction materials, modification to the original design, and the addition of facilities, are considered. The completion review noted that many cost items in the original estimate were based on outdated cost quotas that were far below market prices. This significant underestimation of the project's cost also affected the financial and economic evaluations made during project preparation.The component for institutional strengthening was not implemented. The main reason was the change in the operational arrangement for the railway. The executing agency was unable to identify alternative areas for institutional strengthening. This affected the realization of value addition of ADB's assistance. The executing agency needs to identify its priorities in the sector, as well as the project company that can benefit from the expertise of international or national consultants.The project budget did not include adequate resources for resettlement and social impact monitoring. This resulted in difficulties in complying with the requirements for timely monitoring reports and reports on the project's benefits and impact during the construction stage and after project completion. Although generally sound, the project framework and the project performance management system designed at appraisal contained some impractical indicators, and the information required to monitor their achievement was not available from the executing agency's normal reporting system. In addition, due to limited budget available, the project benefits and impacts were not reported adequately during implementation.
Taiyuan-Zhongwei Railway Project