The land acquisition and resettlement costs should be budgeted adequately during project preparation. The resettlement costs for the project increased by over 300%, mainly because of the significant increase in land compensation rates resulting from the nation-wide resettlement policy reform in 2008. When budgeting for resettlement cost, the project team should assess whether the existing resettlement policies are outdated and compare the policies with the market prices to assess whether the policies are reasonable. Based on a detailed measurement survey and cost assessment, the project team should then budget adequately for resettlement costs to ensure that the implementing agency has adequate funds to pay compensation to the affected people.
Central Yunnan Roads Development Project