Report No. TO-678a

This report was prepared for use within the Bank and its affiliated organizations.They do not accept responsibility for its accuracy or completeness. The report maynot be published nor may it be quoted as representing their views.

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

INTERNATIONAL DEVELOPMENT ASSOCIATION

APPRAISAL REPORT

SEA DEFENSE PROJECT

GUYANA

September 10, 1968

Projects Department

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CURRENCY

Guyanese dollars (G$)

US$1 3 G$2G$1 - US$0.50G$.,o000,000 us$500,000

WEIGHTS AND MEASURES (British System)

1 inch (in) - 25.4 millimeters (mm)12 in a 1 foot (ft)5,280 ft = 1 mile (mi)

- L 609 kilometer (km)1 acre (ac) a 43,560 sq ft

* 0.405 hectares (ha)1 sq mile - 640 ac

- 2.590 sq km= 258.99 ha

1 long ton (ton) - 2,240 pounds (lb)a 1.Cl6 metric tons (m ton)

ABREVIATIONS USED IN REPORT

GD Georgetown DatumMoWH Ministry of Works and Hydraulics,

GuyanaUK United KingdcmtMDP/SF United Nations Developnent Program

(Special Fund)

GUYANA

SE, DDFENSE PRCOECT

APPRAISAL REPORT

TABLE OF CONTENTS

Page

C`UNMARY -l i

I. INTD'CDTUTTI OtJ I

II. RACKGKRO UN D

A. The Dsvelopment of `ea Defenses 2B. Cyclic and Local Erosion 1C. The Sea DefenFe Program K1

III. THE PROJECT A REA 5

A. PhvFical and Economic Conditions 5B. Design of Sea Defenses for the Project Area 7

IV. THE PPOCE)CT 8

A. Sea WalL Construction 9B. Engineering, Economic and Hydrographic

Studies 11C. Project Costs 11D. The F'inanci ri of the Project 1^

V. ORGANIZATION4 AND YDANAGEM"IT IL

VI. BEN7,FITS A.D JUSTIFICATIONIS 15

A. Benefit.s of the Program 15B. Estimated Rate of Return 17C. Fiscal Implications of the Project 16

VII. CCIV:NCLIUIOMS AND RECOIMMENDATIONS 19

This report is based on a feasibility study prepared by the Ministryof Works and Hydraulics, Guyana, and the findings of an appraisalmission consisting of Messrs. D.M. Haynes, F. Afrouz, R.Y. Scheiner(of the Bank) and Mr. E. Quicke (FAO/IBRD Program) wh4.h visitedGuyana in April - May, 1968.

AiNNE 1;-I - T2ite 1 - Gro:'8 'Dno:tic Prodiucl .nd Contribution of

Psotiet t 5;a. . r ]n

- TI? le t Value of NationC I x ortP ?nd Pro(duction in

Pro Ioect. Area (L9, Ulv)- La, La: - Govnonr!n 1. ne Pl | evenuen fron' Project

Area I kii§,(,- rd 19bCa

Co' ta . rosion , and Se2 DeI f,- i_l r u' n

-f Tb L-. -Year L,Ui 1Thefence ProCr-r,

- T:nLe - 12-Year Sea Defen5e ProPrnw

AN.N - P "; ject. - Cra.o[: 2-rolni. a:

A;wi3.e , Ev,i-t;i.e.i l 'Pro ject C:osts

ANNEX 6 - 2 ecoverv OfI ProJ1ect CGou,tF

I r e 1 - Proprra, CostA- and 'ev-enue!

- - I e'. - Prorram an,rd Internlo 1 esource-

A_4NiN:EX 7 - :WH`a±u'ntion of ' conrnmic Bernefiti of' t a ea Defenme Prograr--Ts4Ae 1 - f,out;, of Progru-r, and ;_ub'p-eqr ent. V'ork; in Pro-ect

A r2a- T. bLe a-es 0i Tetur t-n of Pro je,t Under tDiff erent.

A ,, szmt ions,

FICTORt3 I - 'I'ide C,urve:;FIGIJRE IT - Organizat,ion of r,inistrvl o-f dru k no iydraulics

FIGrZUR, IIf - ConF--truction 5chneduie

INi an 1 - GuaC,y,!. n.

l>MarI - £'srerlmia-o Corent.v-ne Co,s i. - jo- J: Vine r. s and Popui,, tion

Ya p 3 - Sen D(funme Progf.-. ia ut. Demerara Cooa-t

l;an .l - .-,ea n .D en i a PF o rr-:u et. C,oa 1. Ui iera rn.

Cl flfAN' A

SFA DJDF!U!S2. PROJ1ECT

APFRAISAL FFPORT

SxIP D.AIRY

i. The Government of Guyana has prepared a Twelve-Year 'ea DefensePrograin to protect the fertile coastal plains, which lie below sea level

The Program includes full details of works to be undertaken in the first

four years (Phe.se I), but the proposals for 1972-79 are indicative and wouldbe finalized on the basis of feasibilitv stuoies_.included in Phase 1. The

estimated cost of the Program is G.9S million (USc$46.5 million) of whichabout G$)30 million (about G$33.5 million including, protective works for

Georgetown) would be recuired for priority works in Phase I. The Govern-ment has requested the Bank's participation in financing part of theforeign cost of Phase I and has requested assistance for the remainder of

the Phase I works from the IJnited Kingdom. The United Kingdomr has given anunderstanding to the Bank that, subject to annual parliamentary approval,it will finance these works.

ii. The coastal plains, although less than three percent of the area

of the country, are the home of 95 percent of the population and producealmost 80 percent of GDP. The project area accounts for 20 percent of agri-

cultural production, the mainstay of Guyana's econory.

iii. The selection of sites and the design of the project works arebased upon a study of coastal erosion, financed by the United Nations Devel-

opment Program, (Special Fund) for which the Bank was executing agency.

iv. The Bank project would include construction of about five miles

of masonry/concrete sea walls of various types; pvrchase of eouipment to

extend the scope of coastal erosion research and hydrographic studies; and

technical and economic studies to prepare projects, on the basis of eco-nomic priority, for later phases of the Program. The Ministry of Warks

and Hydraulics would be the executing agency for the construction of sea

walls as well as for the procurement of equipment. Contracts for construc-

tion and procurement would be awarded after international bidding. Engin-

eering consultants would review specifications and documents, administer

contracts and supervise construction, which would be completed in four

years. The studies, which would include the design and economic evaluation

cf a breakwater or alternative protection at Georgetown, would be carried

out by consultants according to a schedule which would permit subsequent

financing to be completed in time to allow later phases to continue without

interruption.

v. The cost of the project, incl.uding interest during construction,

is estimated at (,:15 million (-17. million). The estimateU' foreignexchange component, about G:1;1O0 million (lJS.5 million enu:ivP.eient) or two-thirds of the total, would be finnnced by thc rroposed loan.

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vi. If't.he sea defenses were not built, the economic value of theproject area would soon diminish, not onily because of the gradual loss ofland by erosion but also because the value of residential property and agri-cultural rroduction would be drastically reduced by the more widespread awd

ralpid intrusion of sea water. 'I'The benefits of the project cannot be isolated,since the other works in the Twelve-Yesr Prograr. are necessary to ensure nro-

tection of thie area. The total direct benefits (i.e., protection against loss

of agricultural production and residential values in the whole area) must

t'rerefore be con.nared with the cost of t'he entire Twelve-Year Prograr on

whi.ch thev are dependent. In the absence of data on the actuial rate of loss

if no defenses are buiilt, thlee rates have been postulated. Under the mostcroltble conditions, the rate of returr. would be 31 nercent, or 10 percentif onily agricultural benefits are taken into account. The returns would be

substantially higher if the und.eremployment of the labor force were takeninto account by valuing labor at its opportunitty cost. About 16 percent ofgovernments' revenues, from which project costs would. be financed, are dle-rived fromn the rorject area.

vii. The Swelve-Year S>ea Dsefense Program for the nroject area is tech-nically sound and economically Justified. A project consisting of rartof the first nha.se would be sulit..able for a Bark loan of US'.5 million ecuiivalent,repaycable over ?5 years inciudin,; a five year grace neriod. The borrowerwouild be the Government of ,uyalna.

GUiYANA

SEA DEFENSE PROJECT

APPRAISAI, REPORT

I. INT'RODUCTION'T

1.01 In late 1966, the Bank reviewed Guyana's 1966-72 Development Pro-gram and recommended that the annual provision for reconstruction and main-tenance of sea defenses should be increased fron the Planned *,;2 million toG$4-5 million. 1/ The problem of sea defenses was consideredl at the aid-donors conference at Georgetown in November, 1967, and the Ministry of Works

and Hydraulics (Mol.'H) later prepared a master plan for a Twelve-Year Sea

Defense Progran. The estimated cost of the whole Program is G$93 million,

of which about G$30 million (excluding the cost of protecting Georgetown)

would be spent during the first four years. Expenditures during the Programwould rise to an annual level of G58.7 million and, with the amount of

foreign aid envisaged, the Government's net annual expenditure (including

loan service) would rise from an average of G$2.9 million during the four

years of Phase 1 to an average of G*4.5 million during 1972-79.

1.02 In March 1968, the Government of Guyana asked the Bank to partici-

pate in financing the present project which is part of Phase 1 of the Pro-

gram with an estimated cost of G$15 million (US$7.5 million equivalent).'I'he Government has asked the United Kingdom (U.K.) to finance the remainder

of Phase 1.

1.03 This report is based upon information supplied at various times

by the Government of Guyana; on the reports of a UNNDP/SF survey of coastal

erosion; 2/ and on the findings of an appraisal mission composed of Messrs.

D.M. Haynes, F. Afrouz, R.Y. Scheiner (of the Bank) and Mr. E. Quicke (FAO/

IBRD Cooperative Program) which visited Guyana in April-May 1966.

II. BACKGROUND

2.01 The estuaries of the Essequibo and Rerbice Rivers (Map 1) were

first settled by the Dutch in 1581. In 1841, Britain purchased the Dutch

settlements and merged them into the Colony of British Guiana which in 1966

became the sovereign nation of Guyana.

1/ A Bank economic report entitled "An Appraisal of the DevelopmentProgram of Guyana" (Report No. WH-Th9b), dated April 21, 1967.

2/ United Nations Development Program (Special Pund) "DemararR CoastalInvestigation, Volumes I to III": Hydraulics Laboratory, Delf]t, TheNetherlands; 1962. The Bank was the executing agency for this survey.

:.02 Guyana, which is about. the same size as Great Britain (83,000 sqmiles), had an estimated populax-ion, at the end of 1967, of 690,000, increasingat a rate of about 2.U percent per annuzm. 'he 1967 CDP was about G$370millioll (Annex 1, 'able 1 ) and t-he per capita income roughly Fr,L35. ,ome

l'70 ercent of the nopulation live in rural areas and 35 percent of availablelabor is engaged in agriculture, which contributes over 20 percent of CDP.historically, the economy has been based on sugar exports, with rice playingan increasinrly important role sin the ptast two decades. However, minerals -T-ainly bauxite ;ind its products - are now the major commodity, accountingfor aLmost half of all exnorts, which totaled G$187 million in 1966 (Annex1, Table 2). T!he mining industry, which is the only major economic activityin the interior highlands aind' sandy foothills, contributes almost 20 percentof CDP but emp.loys only five -ercent of' the ..Labor force. Under-employmentis widespread, even in the main sugar--nroducing districts, and it is estimatedthat some 20 percent of the avallsable la:bor force is unemployed.

2..03, With the exception of a small, remote area of cattle-ranching onthe Savanna in the southwest, the interior has little ag-ricultural potential.Agricultural nroduction and all other non-minin- activities are concen-trated in a narrow fertile strip of the coastal plain (M'ap 2). This plainseldom exceeds ten miles in wid-th, and totals only about 2,500 so miles,but it contains 9'5 percent of tre prpulation and produces almost 80 percentof GDP. Unfoitunately, the coastal plain lies below high tide level and isliaiole not only to inundation and erosion oy the sea in front but also toflooding by run-off from the hills behind. The Guyanese cannot retreat tothe infertile interior. The protection of the fertile strip against erosionand. flooding is therefore of vital irm ortance to agriculture and to thewhole economy.

A. The Development of Sea Defenses

2.04 The first nolders on thre coastal nlain were built in about 1770,when soil exhaustion forced the original settlers to abandon their planta-tions on the riverine soils. The cost of empoldering and draining theswaniips was great but the higher yields justified the huge outlay on slavelabor. Over 200 sugar plantations had been reclaimed by 1834, when theslaves were em.ancinated, The rising cost of indentured labor from India,C'hina and elsewhere, an1 increasing competition from other sugar producingcountries led to the abandonment of many plantati.ons and eventually to theconsolidation of the remainder into the present eleven sugar estates. Aban-doned plantations, and others which were sold off piecemeal, were taken overby smallholders g,row:Ing rice, root crvlps, veretables and coconuts.

2.05 'r'le polders were originally some distance inland from the sea andwere protected against encroachment by the tid.al flats and mangroves. Even-tually, as the shore eroded, it became necessary to build sea dams acrossthe f'ront of the polders to prevent flooding at high tide. These earth dams,in turn, were eroded by the sea and collapsed, forcing the proprietors toretire inl.and and build a new line of sea dams. vy about 1920 the line ofdefenses was close - in many cases less than helf a mile - to the ed.ge of the

cropped area. Efforts were made to strengthen the sea dams, at first bydriving wooden or steel piles along the sea ward side of the earth banks andlater by building "revetments". 1/ In general, towever, these new defenseswere still sane distance inland of the mean high water line. They were onlyreached by the sea during high spring tides and storms. The force of in-coming waves was dissipated by the vegetation bn the tidal flats and thereinforced sea dams were not exposed to vigorous erosive wave action forlong periods. Erosion of the foreshore has continued and today many of thedefenses are continuously exposed to the action of the sea. New types ofwalls are now required to resist erosion as well as to prevent flooding.

The Administration of Sea Defenses

2.06 The first sea dams were built by plantation proprietors on theirown initiative and at their own expense but, in 1880, the Director of Pub-lic Works was given powers to direct proprietors to construct approveddefenses and to provide loans for this purpose. However, many estates wereabandoned and it became clear that the provision of adequate defenses wasbeyond the resources of individuals. In 1906, therefore, nine Sea DefenseCommissioners were appointed with powers to levy taxes on an acreage basisto finance construction. Later, in 1913, Government accepted the responsi-bility for one-quarter of the costs of construction and maintenance.Finally, the Government accepted responsibility for the full cost of seadefenses through the enactment of the Sea Defense Ordinance, 1933, (asamended in 1937) which remains the basis of the administration of sea de-fenses. The main points of the Ordinance were:

(a) A twelve-member Sea Defense Board has statutoryresponsibility for the sea defenses of the entirecoast.

(b) The Board has very wide powers to take necessaryaction in emergencies: e.g., it can call upon theresources of Government departments and the privatesector, without waiting for legislative approval toincur expenditure, to contain flooding and makerepairs when breaches occur.

(c) Planning, construction and maintenance is carriedout by the MoWH and the cost (except for an annualcontribution of G$2,500 from Georgetown Council) isprovided in the Government budget as a charge ongeneral revenues.

1/ Masonry or concrete coverings to the sloping, seaward face of theembankment.

B. Cyc_Lc and Local Erosion

2.07 The coastline of Guyana is subject to a cyclical erosion pattern(Annex 2). The meain centers of erosion are about 25 miles apart and movewestwards at about 0.7 - 0.8 miles per year. The peak attack on a particularpoint on the shore therefore recurs at intervals of about 30 years and isfollowed by a period of accretion, during which mud is deposited on the fore-shore.

2.08 The UNDP/SF Study showed that it was possible to foresee when anarea will be affected by cyclic erosion but it is difficult to predict accur-ately when erosion will actually affect sea defenses since this depends onthe width of the tidal flats, the type of material making up the foreshore,the intensity of wave action End the direction of wave attacks. Moreover,the general pattern is disturbed near the mouth of rivers by local currentsand by local deposition of riverain silt. Similarly, manmade or natural ob-structions to tidal and other currents may cause unexplained local erosion,which is almost as severe as t.he cyclic attack but which may stop as un-predictably as it began. Further studies are required to extend the resultsof the UNDP/SF study to all perts of the coast and to improve the methods ofpredicting which locations should receive priority in sea defense planning.

C. The Sea Defense Program

2.09 The Twelve-Year Sea Defense Program (1968-79), prepared by theMoWI, is described in Annex 3. The aims of the Program are:

(a) To provide a reasonable degree of protection to allparts of the coast;

(b) to reclaim about 10,000 acres of land, mainly tidalsalt flats, for agriculture and housing; and

(c) to improve drainage in selected areas.

2.10 The four-year Phase 1 of the Program, of which the present projectis a part, includes rehabilitation or construction of defenses in areasnow under active local attack or where cyclical erosion is predicted during1969-74. The proposals for later phases are merely indicative but Phase1 includes provision for further technical and economic studies and forthe preparation of feasibility reports, on the basis of economic priorities,for works to be started after ]971. Provision is also made in Phase 1 forexpansion of hydrographic surveys, to permit studies of cyclical erosionalong the entire coast.

2.11 The Government of Guyana asked the Bank to assist in financingthree parts of Phase 1; tne construction of new sea walls on existing earthembankments in East Demerara; similar works in West Demerara; and the con-struction of a breakwater in front of the Georgetown Esplanade. However, it

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was found during appraisal that, although the area behind the pronosed break-water is highly developed, and is liable to be attacked by cyclical erosionby 1971/72, the proposal was not fully prepared: surveys and test boringsof the site, hydraulic tests to determine whether the structure would performits functions, and further studies of the cross section and method of con-struction would be needed before the proposal could be evaluated.

2.12 The Government has indicated to the Bank that it will seek financialassistance from the U.K. for the remainder of the works in Phase 1. Theseinclude construction of new, and rehabilitation of old, sea waJJs or, Eastand West Demerara Coasts, (including the existing wall in front of (ceorgetown)and protective works on the Berbice, Essequibo and Corentyne coasts andthe islands in the Essequibo Estuary.

2.13 It became clear during appraisal, that the sites on the Pemlerarn.Coasts had been carefully selected. While the locations of the variousBank and U.K. works are separate they are interdependent upon each other.For example, serious economic damage co-uld be caused in land behind a Banksection because of flooding through a breach in a nearby section not constructedin time. Similarly, substantial economic loss could result if sugarcaneor rice produced on land behind a Bank-financed wall could not be processedbecause a sugar-factory or rice mill had been put out of action by a breachin some neglected section of the defenses.

III. THE PROJECT AREA

3.01 A claim by Venezuela to certain territories, generally lying tothe west of the Essequibo River, is being discussed by a "Mixed Commission'!established by the Geneva Agreement signed in February 1966 by the 1T.K.,Venezuela and the Government of Eritish Guiana. Although the Programcovers the whole coast, all works in the Bank project lie in a part of thecoastal plain to the east of the Esseu-lbo (see Map 2) and thus outside thedisputed territory and the claim was therefore not considered relevant tothe project. The Demerara River divides the area into two Districts; EastCoast Demerara (Map 3) and West Coast Demerara (Map 4).

A. Physical and Economic Conditions

3.02 The climate of the two districts is similar, although there is ageneral tendency for the mean rainfall to increase from east (86 in) towest (100 in). There have been six major, and several minor, droughts inthe past eighty years and periods of 2-4 years with higher than averagerain recur at irregular intervals. The effects of the rainfall deviationsare cushioned, but not eliminated, by the drainage and irrigation systems.Sugar is less affected than rice partly because it is a perennial andpartly because the estates have more efficient systems than smallholderareas.

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East Coast Demerara District (Map 3)

3.03 The East Coast Distr'ict is bounded on the south by the DemeraraConservancy Canal, which brings irrigation water from a large catchment in

the hills and swamps. The gross area between the CanaL and the sea isabout 59,000 ac but includes some areas of infertile peats and saline clays

which are unsuitable for agriculture; crop area and other data are given

in Annex 4.

3-04 There are two large stLgar estate groups, each with its own fac-

tory; the coTnbined factory capacity (70,000 tons of sugar per year) is more

than sufficient for the 21,000 ac of sugar cane. Most of the cane is

grown by estates, outgrowers providing less than ten percent. The main

concentration of smallholdings is at the eastern end of the District, cov-

ering about 15,000 ac. Rice, the most important smallholders crop, is

processed at mills in the District. Vegetables and -oot crops are grown

for the Georgetown market and coconuts are planted on sandy ridges and in

gardens. Apart from one estate--owned herd, there is no organized livestock

industry but many households kee!p cattle and small stock.

3.05 Population of the District is estimated at nearly 73,000, a

density of 790 per sq mile. ]states provide housing for key employees and

the majority of their labor force live in residential areas along the

coast. There are an estimated 17,500 houses in the District, many concen-

trated in the major villages which serve as dormitories for Georgetown

workers. A few light industries (e.g., a shirt factory) have been estab-

lished at the eastern end where electricity is available from Georgetown.

Each village has its own retail system and there are a number of sports

clubs, cineŽmas and other amenities.

3.06 Each plantation and village has its own simple road, running at

right angles to the sea. Sugar cane is transported to the factories by

punts on irrigation canals, which are interconnected by navigation canals.

The road and railway are the only channels of communication across the

District.

West Coast Demerara (Map 4)

3.07 The West Coast District (42,000 ac gross) is bounded on the south

by the Boerasiri and Bonasika Canals. It is divided into two physical

units by the Boerasiri River but the two parts are economically dependent

upon each other.

3.o8 The pattern of agricultural development is similar to that of

the East Coast District. There are two sugar estates with 13,500 ac of

cane and two factories with a combined capacity of 48,000 tons of sugar

per yeer. Rice is the main cron- on small holdings. The population is al-

most 42,000, a density of 64o per sq mile. There has been comparatively

little residential development, the 8,000 houses serving the local labor

force rather than being dormitories for Georgetown workers. Utilities and

amenities are of a lower standard than those of the East Coast District:

there is no light industry but -the area has its own rice mills.

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3.09 The West Coast District is separated from Georgetown by theDemerara River, which is crossed by a ferry. Considerable amounts ofsugar and other produce are sent directly to Georgetown by boat, but therailway is an important link with Parika, the terminal for ferries servingthe islands in the Essequibo Estuary and western parts of the country.

B. Design of Sea Defenses for the Project Area

3.10 A wide belt of deep clays, mixed with silt, forms the shore ofthe project area and extends many miles under the sea. The gradient of thesea bed is very gentle on the West Coast, where the depth of water may beless than one fathom (6 ft) several miles out to sea, but steeper on theEast Coast, where the one fathom line is usually less than a mile fromshore. The range of the semi-diurnal tides is 3-10 ft, averaging 4 ft atneap tide and 9 ft at spring tide (Fig. 1).

3.11 The prevailing winds come from the northeast across hundreds ofmiles of open sea. The highest winds (about 25 mph) occur in the earlvmonths of the year but Guyana is outside of the hurricane belt. Wave ac-tivity is greatest from November to April when long ocean swells arrivefrom the northeast. These swells break up into local, shorter waves whenthey reach the continental shelf - about 150 miles off shore - and laterthe shelving coastline. The wave height averages about 4 ft during roughperiods, but only 1.3 ft during calms; the UNDP/SF study reconmended thata wave height of 6 ft should be used for design purposes. The uprush ofthe wave when it strikes the shore or a sea wall depends on the height ofthe wave, the angle at which it strikes and the slope of the foreshore andwall. The combination of these factors is such that uprush is considerablygreater on the East than on the West Coast.

3.12 All of the locations included in the project are now protectedby earth embankments. These embankments are expected to prevent ingressof sea water until the shore is eroded below 49 GD 1/ but are not protec-ted against erosion by rain or direct action by waves. The specific loca-tions were selected either because the foreshore is already under cyclicattack which will certainly lower the foreshore below 49 GD or because itis already below this critical level due to local erosion.

3.13 The main function of the sea wall is to protect the embankmentagainst erosion. Because the clay soil offers a very poor foundation, theheight of an embankment is limited to about 9 ft above ground level, i.e.,to less than 60 GD in most locations. This is not always sufficient tocater for wave uprush, especially on the East Coast, and the sea wall must

1/ Elevations in Guyana are measured in feet above a hypothetical datum,Georgetown Datum (GD), to provide positive numbers even for placesbelow sea level. Mean sea level is 50.54 CD; the highest recordedtide was 56.24 GD; the elevations of other features of interest are-hou'n in Figure 1.

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also be provided with a wave screen (coping) to increase the height of thecrest to about 62.5 - 63.0 GD.

3.14 The proposed designs for sea walls for the East and West Demeraracoasts are described in Annex 3.

IV. THE PROJECT

4.o0 The project, which would be executed over four years by the Ministryof Works and Hydraulics, would be a part of Phase 1 of a Twelve-Year DefenseProgram. It would include.

(a) construction of about 26,230 ft of sea wallsincluding 21,230 ft in East Coast Demerara and5,000 ft in West. Coast Demerara (see para. 4.03et seq);

(b) purchase of equipment to permit expansion of theactivities of the Hydrographic Survey Section, MoWH(see para. 4.13); and

(c) preparation of feasibility reports for the Georgetownbreakwater and. future phases of the Program (seepara. 4.12).

4.02 As noted above in pars. 2.13 the works included in Phase I areinterdependent, and ;he proposed Bank project would not be justified withoutthe construction of the remainder of Phase I, at an estimated cost of aboutG$ 15 million (US$7.5 million equivalent), excluding the cost of works toprotect Georgetown. The Governnent has agreed to finance and constructthose works which are not included in the project. At the Aid CoordinationMeeting in November, 1967, the IJ.K. expressed an interest in financing partof a sea defense program and the Government has accordingly submitted to theU.K. a request for financial assistance for the remainder of Phase I. TheU.K. has informed the Bank of its willingness, subject to annual parliamen-tary approval, tc provide the necessary funds. The Government has alsoagreed that it will 2onsult with the Bank on the financing and implementationof the program for works at Georgetown and for later phases of the Twelve-Year Program, which will be prepared on the basis of the feasibility studiesincluded in the project,

A. Sea Wall Constructicn

Suitability of Sites and Designs

4.03 The locations for project works were selected from among thesEincluded in Phase 1 because they were suitable for contract works and wqrelarge enough to attract international bidding. The choice of sites is suit-able from both technical and economic aspects. The actual location of works

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included in the proposed project are shown in Annex 3, Table 1 and in Maps 3and 4. In every case the shoreline is presently being eroded, but in mostcases the proposed line of defense is several hundred feet inland. Most ofthe project works can therefore still be executed "in the dry" without theadditional costs associated with cofferdams and working under tidal conditionsbut, if erosion of the tidal flats continues at the present rate, all of thecompleted walls will be exposed to the sea by 1973. All of the project siteshave been acquired by the Sea Defense Board. Access Is available to allsites but existing tracks will require improvement. Estimates of projectcosts include provision for preparatory site works.

4.04 The three designs proposed for the sea walls are satisfactory. Thecross sections are based upon hydraulic tests carried out in the hydrauliclaboratory at Delft University, but incorporate local experience and areconstructed of local materials. A length of Type 1 wall has withstood heavywave attack, with the foreshore eroding below 48 CD, during 1967/8. Type 2is of a similar hydraulic design but will be used in alireas which are beingattacked by local erosion. The Type 3 wall is a development of earlier de-signs, incorporating modifications suggested by the hydraulic tests, and hasalready been used on the West Coast.

4.05 There are 19 drainage outfall structures of various types in theproject sites but 10 are in good condition and can be incorporated in thenew waUls. Two outfalls belong to sugar estates and the cost of repairwould be shared equally by the estate and by Government. The remainingseven belong to Government and the full cost of renewal is included in theestimates of project costs.

Availability of Materials

4.o6 The cement, reinforcement steel, sheet piles and polyethylenesheets required for the sea walls would be imported. A considerable numberof shipping lines serve Georgetown.

4.07 Good quality sand is available in unlimited quantities in thefoothills near Atkinson Field (Map 1) and is transported by truck for workon the East Coast. On the West Coast, sand of adequate quality is dug fromsand bars.

4.o8 Boulder stone and aggregate, which account for about US$1.4 million,or a third of the cost of the civil works, are available on the banks of theEssequibo River, scme 50-60 miles upstream from the coast (Map 2). Thestones produced in these quarries are loaded on barges and transported byriver and sea to the shore (West Coast) or Georgetown (East Coast). A fewprivate owners presently control most of the quarrying capacity. In orderto break the oligopoly of these quarry owners, who were able to impose highprices on the stone, the Government opened another quarry and is now operatingit on a break-even basis. This move succeeded in reducing the prices somewhat.The combined output of private and government quarries in 1967 was 130,000tons of crushed stones and 20,000 tons of boulder stones. Phase I of theprogram will require some 700,000 tons of stone, with peaks of 300,000 tonsper year and 40,000 tons per month. Although the quarries have adequatereserves of rock, neither the private nor the government quarries are presently

- 10 -

equipped to produce or handle such. quantities. Investments are necessaryinI equipment, transportation means, improvement of loading and unloadingfacilities and establishment of storage areas, to meet the requirementsof the Sea Defense Program and other competing demands for stone, all ofwhich would require a doubling of present capacity. During discussionswith the quarry owners, it appeared that they were willing to invest in

increasing their production capacity substantially in time to meet the demandsof the Sea Defense Program. One of the largest quarries is negotiatingfinancing from the Commonwealth Development Corporation (U.K.). As quarryingis one of the very few industries in Guyana, Government is anxious to encouragelocal producers to make investments necessary to augment production to meet

the anticipated demand and to establish it on a sound and economically viablebasis. In a shortage situation, it is possible that local stone pricesfor all categories of stone required for the project could increase. Estimatesmade by a road construction company operating in Guyana indicate that crushedstone imported as ballast on bauxite vessels coming to Guyana would cost10 to 20 percent less than locally produced stone of similar grades. Thereis, however, great reluctance on the part of Government to allow stone impor-tation, although a mechanism for licensing imports exists.

4.09 The Government is cwrrently negotiating for U.K. financial assist-ance to improve unloading facilities at Georgetown. Assurances were ob-tained during negotiations that these improvements would be effected priorto the start of construction of the project works in late 1969 and thatGovernment would take urgent steps to encourage and facilitate the substantialexpansion of the quarries, by this time. Governnent further agreed thatinvitations to tender for civil works would specify, inter'alia, that bidsmust include alternative prices for local and for imported stone. Agreementwas obtained on a procedure which provides a "weighting" of about 25 percentin favor of local stone when evaluating these alternatives or others, in-cluded at the bidders option, based upon combinations of local and importedstone. It was agreed that Government would promptly issue import licensesfor any imported stone specified in the successful bid. This departurefrom the Bank's usual practice of concerning itself only with goods procureddirectly under a project and not with goods procured by civil works con-tractors is justified by the particular importance of stone, which accountsfor about a third of the civril works costs, to the project and to the economyof Guyana.

h4.10 There is sufficient labor available for the proposed project andother foreseen development works. There is a scarcity of skilled mechanics

and shortages may develop in other trades, but no serious problem is antici-pated provided that contractors institute in-service training for artisans.

Construction Schedule

4.11 Details of the project schedule are given in Figure IV. Selec-tion of consultants, preparation of documents and the award of contractswould require ten months. The construction period, including mobilization,would be 36-40 months. Work would proceed concurrently on the East andWest Coasts and. contractors would be required to phase works in relationto the expected date of erosion.

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B, Engineering, Economic and lHydrographic Studies

4.12 The cost of carrying out engineering and economic studies and ofpurchasing equipment required for the expansion of hydrographic surveyswould be included in the project. These studies would include:

(a) The preparation of hydraulic, engineering and economicfeasibility studies for the proposed breakwater andalternative measures for protecting the GeorgetownEsplanade. The report would be available by the end of1969, in time to allow consideration, by the Bank andother sources, of financing construction before thecyclical erosion attack expected in 1971-72.

(b) A comprehensive study aimed. at further improving crosssections for sea walls, including consideration ofconstruction methods, materials and costs as well ashydraulic tests of models, to be completed not laterthan 1971.

(c) Feasibility studies of works to be constructed after1971 including assignment of economic priorities toindividual sections.

4.13 The collection of hydrological and sedimentological data is pre-sently carried out by two old, unreliable launches. Data are collectedmainly on the Demerara Coast, where manmade landmarks allow visual meansof position-finding. The project would include provision for a new surveyvessel with modern instrumentation and radio navigation aids to allow itto work in poor visibility and out of sight of the shore. Provision wouldalso be made for wave recorders and other equipment necessary for collectingdata for the planning of future sea defenses on a more analytic and scientificbasis.

C. Project Costs

4.14 The estimated cost of the project, including interest duringconstruction and contingencies, is G$14.95 million. Detailed estimatesare given in Annex 5, Table 1. The main categories of cost would be:

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Local Foreign TotalCurrency Exchange Cost

- - - - - - - - - G$'000 - - - - - -.

Construction: 3,280 5,940 9°,220Engineering fees, supervision

-and preparatory works 920 920 1,840

4,200 6,860 ll,060

Purchase of Equipment - 40 414 0Tests and Studies 100 700 800Contingencies 700 1,000 1,700Interest During Construction - 950 950

Total Project Cost 5.,000 9,950 14,950

(Approximate US'`'000 equivalent) (2,500) (5,000) (7,500)

4.1f The cost estimates have been revised by the Bank to take accountof engineering fees, contingencies and other items excluded from the esti-mates in the project submission. Fully-detailed unit costs were preparedfor each type of sea wall and provision made for preparatory works andother costs incurred by contractors. Foreign exchange canponents, averagingabouit two-thirds of the total, were estimated for each item and include fuel,spares and depreciation for stone quarrying, construction and transport equip-ment, as well as direct imports; no foreign costs were imputed to labor.ContirZencies were estimated at 15 percent for construction works and atvarious rates for other items, averaging 13.8 percent overall. Government,following its normal procedure f'or development projects undertaken by inter-national contractors, would exempt from import duties materials for use onthe project and (subject to reexnort) construction equipment used exclusivelyfor project works.

D. The Financing of the Project

4.16 The borrower would be the Government of Guyana which would financethe works by annual allocations to the IIoWH. The proposed loan would financethe foreign exchange component of the project, G$9 million, and interestduring the four-year construction period, G$l million approximately. Theproposed loan would therefore total G1.l0 million (about US$5 million equivalent).The Government would finance the local cost component of the proposed project,G$5 million (US$2.5 million equivalent).

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4.17 Phasing of expenditure is shown below:

Year: 1 2 3 4 5a/ Total

… - - ------------ G- G$ million…--- ----…

Local costs 360 880 ',610 1,970 180 5,000

Foreign costs:Project costs 1,020 2,010 3,180 1,970 820 9,000IDC b/ 80 160 290 4;20 - 950

Total Cost: 1,460 3,050 5,o80 4,360 1,000 14,950(say 15,000)

a/ Mainly retention money and other expenditures on account of worksconstructed in Year 4.

b/ IDC: Interest during construction and other loan charges.

Procurement and Disbursement

4.18 The civil engineering contract(s), totaling about uS$4.6 millionequivalent, would be awarded on the basis of international competitive bid-ding. CDntractors could bid for the entire civil works or for either theEast Coast or West Coast parts separately. The Bank would approve the prop-l|-iterms of reference and appointment of consultants (para. 5.04), specifications,and other tender documents before issue; comment on all bids; and approveawards before they are made.

4.19 Disbursements from the loan account would be made i4ainst appro-priate documentation covering 100 percent of the cif cost of the surveylaunch and hydrographic equipment, 100 percent of the foreign exchange costof the consultants fees and an agreed percentage representing the foreign,exchange portion of civil works contracts. Undisbursed amounts would beavailable for cancellation; any excess over the estimated cost of the projectwould be met by Government.

4.20 No retroactive financing of project costs is envisaged and nocontracts have been awarded in connection with the proposed project. Gov-ernment has agreed that, as a condition of effectiveness of the proposedloan, consultants acceptable to the Bank would be appointed to prenare Tenderdocuments and to supervise works. However, only costs incurred after thedlate of signing would be met from the proposed loan (para 5.04).

Recovery of Project Costs

4.21 In accordance with the 1933 Ordinance (para. 2.06) the cost of theproposed project would be financed from general revenues. Because of theconcentration of population and economic activity in the project area, thiswould be tantamount to recovering the costs from the direct beneficiaries(see Annex 6 for further details) and is considered reasoneble.

V. ONNW.rlP.I01'T A D MAJqAGEi!FT4T

Th.e Sea Defense Board

5. 01 The ';ea Defense Board would have certain statutory and advisorypowers (see para. 2.06") but would take no part in the execution of the proj-ect. Tlhe possibilitv of strengthening the Board, so that it might play anexecutive .ind financial role during later phases of the Sea Defense Program,was considered during appraisal. However, it was found that the technicalservrices provided bv the MoWH are indispensable and are inseparable fromthe administrative organization; to build up the Sea Defense Board as anadministrative body would. involve unnecessary duplication of effort. More-over, it might Tipair the loard's present ability- to act quickly and effi-ciently during emergencies.

The M';inistr__f Works and HydrauLlics

5.02 The organization of thie Mo1*1 is shown in Figure V. The routinework of the MA1inistry, including minor sea defense projects and maintenance,is carried out by District Engineers, who are supported by specialist divi-sions in headquarters. The Hydraulics Division is responsible for planningand design of both sea defense and of drainage and irrigation projects, andsoecialist engineers from the Division are placed in charge of major projects.The Division includes a Research and Survey Section which undertakes hydro-graphic surveys and the collection of clata for sea defense planning.

5.03 The main weakness of the Ministry is in the supervisory grades.There are many vacancies but the young graduate engineers returning fromoverseas training do not have the practical experience to supervise workin the field. The Hydraulics Division also lacks experience in preparingtender documents for large contr-acts. It will therefore be necessary toemploy consulting engineers to review and revise tender documents beforeissue, to supervi,e the opening, review and evaluation of bids, to adviseon the award of cpntr,sacts, an.d io supervise project works. The MoVWH willalso require assistance in carrying out economic evaluations and the prepar-ation of feasibility reports as well as in the technical testing of newdesigns in a hydraulic laboratory.

Consultants

5.014 Government has agreed to appoint consultants acceptable to theBank on terms and conditions approved by the Bank, to (a) supervise projectworks and (b) carry out various studies covered by the proposed loan. Sep-arate offers would be invited on an international basis although a singlefirm could offer to cover both supervision and studies. The supervisionconsultants would be required tc provide at least four engineers for supervisionand to assist the project manager. They would be required to train at leastthree MoWE engineers in site supervision. The consultants conducting thestudies would be required to maXe arrangements for necessary hydraulic andother tests to be conducted in a laboratory acceptable to Government andthe Bank and to nrepare fea*ibil.i;,y studies.

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Accounts and Audits

5.05 The MoWH is a self-accounting department and would maintain sep-arate accounts for the project. The cost of any additional clerical staff(who would also work on other projects in the Program) would be met byGovernment. Project accounts would be auditted annually by the Directorof Audit, who will submit his report within four months of the end of thefiscal year.

VI. BENEFITS A4D JUSTIFICATIONS

6.01 Evaluation of the project presents two main problems:-

(a) The project works would provide only limited protection(even to the land directly behind them), unless supportedby adjoining works; and

(b) the nature of the benefits is unusual and may be quanti-fied in different ways.

6.02 The first problem has been overcome by considering the cost of thepresent project together with the cost of any other works necessary to pro-tect the project area. The estimates for the latter were prepared on the

same general basis as project costs, details are given in Annex 7. Similarcost estimates have been prepared for alternative methods of protecting the

project area from the sea.

6.03 To evaluate the rate of return of the Program, it has been neces-sary to make assumptions regarding the benefits; these, and the methodsused, are detailed in Annex 7 and summarized below.

A. Benefits of the Program

6.o4 The proposed project, rather than being directly productive, ispart of a Program to protect existing production, strengthen the physicalenvironment essential for productive investment and help to establish a psy-chological climate conducive to such investments. Only the first function -the direct benefits - has been considered in detail although the indirectbenefits are of considerable importance to the development of the Guyaneseeconomy.

6.05 The direct benefits would be the eauivalent of the economiclosses avoided by making the investment in sea defenses, including the wholerange of economic activity that would be lost if the project area were pro-gressively or suddenly inundated by the sea. However, only the two mostimportant activities, agriculture (including crop processing) and housinghave been quantified. In these cases, the benefits may be measured eitheras:-

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(a) the annual. value of production and rentals that wouldbe lost; or

(b) the capital cost of replacing agricultural land, cropprocessing factories and houses in some other part ofthe country.

The former method is preferred since the loss in annual production can beestimated more accurately bthan replacement costs (see Annex 7).

6.o6 If no action, beyond the normal maintenance of existing defenses,were taken, breaches would occur and the land would be progressively inun-dated with sea water, making housing untenable and drastically reducing cropyields. Simultaneously, land would be lost through erosion. The rate atwhich these economic losses would occur would be determined by many factors,ranging from the condition of the sea walls to the chance coincidence ofhigh spring tides and on-shore winds at a time in the erosion cycle whenthe peak attack was centered on a poorly defended area. For the purposesof evaluation it has been assumed that all production of the area would belost in one erosion cycle of 30 years. Three different "loss curvest ' havebeen postulated, giving different rates and Datterns of destruction andthus of benefits (see Annex 7, Figure A).

Benefits from Agriculture and Crop Processing

6.07 The benefits froin agricultural production and processing havebeen estimated on the basis of the fob price of sugar and rice, and localmarket prices for other crops, :Less production costs. Current prices havebeen used for a2l crops except sugar; it is assumed that the fob price ofsugar will fall from the current overall average G$l1O per ton to an averageof CQ$168 per ton. 1/ (Annex 7, 'para 7),. Similarly, current prices have beenused for essential farm and fctory supplies. The benefits derived from agri-culture are sumrarized below:

Arnual Va.lue

Sugar Rice Other Total-G~p million -

Fob or market value 19.2 2.7 2.9 24.8Less farm and factory supp:Lies 7.6 0.7 o.6 8.9Annual value (incl. labor) 117 2.0 2.3 15.9Less paid estate and farm labor 6.6 0.7 0.2 7.5Net annual value 5.0 1.3 2.1 8 4(of which, due to processing) ) (0.1) (2°)

1/ Equivralent to 135 per ton (US 3.T5 cents per lb) fob for 960 sugar.Rum and molasses were estinmated at 10 percent of the value of sugarproduction, a decline of two percent from the 1966 figure.

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6.08 These agricultural benefits take no account of the possibilityof improving rice yields through improved drainage nor of the greater pro-duction made possible by the current program of introducing short termrice varieties and encouraging double cropping. Similarly, no allowance ismade for increasing sugar production although the.aggressive research programof the major estate group is likely to improve yields and small areas of newland are being developed. These and similar increments must be regarded asreturns to supplementary investments, although such investments are unlikelyto be made unless the sea defenses are adequate.

Benefits from Housing

6.09 The numbers of houses in the project area and their currentmarket value are as follows:

No. of Houses Current Market Value

(1967) (G' million)

East Demerara 18,250 168.9West Demerara 8,750 81.6

Total, Project Area 27,000 250.5

In the absence of data on the level of rents in the project area', the valueof housing has been imputed as the return on the current market value atrates of 5, 7 and 10 percent per annum (see Annex 7). At 7 percent, whichis a conservative estimate of the return on capital in Guyana, the annualbenefit from housing in the project area. would rise to G$17.5 imillion.

B. Estimated Rate of Return

6.10 The economic rates of return derived from different assumptionsare given in Annex 7. Under the most probable set of circunstances (i.e.,a constant rate of loss and a return of 7 percent on the market value ofhousing), the rate of return would be about 31 percent. Fven if the rateof loss is much lower than expected (see Annex 7 Fig. A), the rate of returnwould still be about 24 percent. If all benefits from housing were disregarded,the return to agriculture and crop processing alone would be about 10 percentat the constant rate of loss and about 9 percent if the rate of loss waslower than expected.

6.11 These rates of return assume that the full cost of paid labor isa production cost. However, there are virtually no alternative employmentopportunities, apart from subsistence farming. Further, unemployment isestimated at around 20 percent in the project area and under-employment iscommon, since about 55 percent of estate labor is seasonally employed. Theopportunity cost of labor, therefore, is very low. If all or part of theagricultural wages paid in the project area were regarded as a benefit tothe economy, the rates of return would be even higher (see Annex 7 para16).

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Alternative methods of Protecting the Project Area

6.12 WIhile the economic benefits of the types of defenses proposed inthe Program are high, there remriins the possibility that delaying the worksor adopting other alternative methods might have economic or financial ad-

vantages. The two basic alternatives are:

(a) to retreat slowly, throwing up new earth embankmentsto replace those eroded away; and

(b) to patch and repair existing defenses, containingflooding wiith earth embankments reinforced with sheetpiling when breaches occur and building replacementwalls as soon as possible.

These alternatives are considered in Annex 7 wlhere it is shown that neither

has any advantage over the proposed project.

6.13 There is no financial or economic advantage in delaying the pro-

posed project. The UNDP/SF s-tudy provides adequate basis for prediction ofthe onset of erosion and shows that sore works ir. Phase 1 must be started

immediately and that the maxiarlurn delay at any location would be less than

three years. The economies of scale obtained awarding large contracts for

the whole works would be considerable. Further, in most sections delays

would involve considerable increases in cost because of the need for tidal

working or for temporary cofferdams. Due to the fact that most of the hinter-land is unsuitable for agricultural production and to the prohibitive cost o-rebuilding houses, factories, roads and canals, it would not be feasible to

relocate the affected population elsewhere in the country.

C. Fiscal I lmications of the Project

6.14 The project area cont:ributes about 16 percent of all Government

revenues. Since revenue.s are expected to increase by 7 percent per annumuntil 1971 and by 5 percent thereafter, the revenue collected in the areais expected to increase from G$13.2 million in 1965-67 to G$25.2 in1972-79. 1/ This growth is unlikely to be achieved if the Sea Defense

Program is not implemented. Far fron increasing, revenues would probably

decline at much the same rate as agriciltural production.

6.15 During 1965-67, expenditure on sea defenses averaged G$2.8 million peryear. No external assistance was received for sea defenses during this period,

and the expenditure accounted for about; 24 percent of the internal resources

(public savings plus internal borrowing) available for development projects.

Annual expenditures on the Program would increase to a maximum annual level

1/ These figures understate the irmortance of the project, area since it

plays a vital part in the economy of Georgetown itself, which alone

contributes 25.7 percept of revenues.

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of about G$8.4 million during 1968-71, and thereafter decline. If only theforeign exchange component of costs were financed externally, the local re-sources required (including loan service costs) would account for 15 percentof total estimated internal resources available in 1968-71 and 17 percentthereafter. If external financing covered 70 percent of total costs - thelevel foreseen by the IBRD Economic Mission for the immediate future - theSea Defense Program would require about 13 percent of estimated internal re-sources during 1967-71 and 16 percent thereafter see Annex 6).

VII. CONCLUSIONS AND RECOMWENDATIO'IS

7.01 The sea defenses for the East and West Coast Demerara Districtsplay an important role in the economy of Guyana by protecting productiveareas. and the proposed project is well justified from the economic viewpoint.The designs proposed are acceptable, the selection of sites is satisfactory,and the cost estimates are realistic. Further studies are necessRry toevolve lower cost designs and to allow a selection of sites for future phaseson the basis of economic priorities.

7.02 The proposed project is suitable for a Bank loan of US$5 millionequivalent for a period of 25 years including a five-year grace period. Theborrower would be the Government of Guyana.

7.03 Assurances have been obtained that:

(a) the Government would finance and construct the remainingworks in Phase 1 and would consult with the Bank regardingthe implementation of works for protecting Georgetownand later phases of the Twelve-Year Program;

(b) a weighting of about 25 percent in favor of local stonewould be allowed in evaluating civil works bids based onthe alternatives of local and imported stone. Importlicences would be promptly issued if contracts are awardedbased on the use of imported stone (see para 4.o9).

(c) the Bank would approve specifications and tender documentsbefore issue, and to review bids and evaluations and approvethe award of contracts (para 4.18);

(d) Government would appoint consultants acceptable to theBank to supervise project works and to carrv out furtherstudies, under terms of reference and conditions of employ-ment acceptable to the Bank (para. 5.04).

September, 1968

)NNEX 1'able 1

GUYANA

SEA DEFENSE PROJECT

Gross Domestic Product and Contri-bution of Praaoct Area for 1967

(at current factor cost)

Gross Dcmestic Value Added inProduct a/ Project Area b/

-1 7 U - -1967 --- __

Value % of Tota'.----- G$ mim=on -------------

Crop Production

Sugarcane 34.3 9.9 29Rice 13.0 1.0 8Livestock 10.7 0.2 2Other 8.0 1.8 22

Crop Processing

Sugar 12.7 3.2 25Rice 4.2 0.3 6

Sub-total Agriculture: 82.9 1604 20

Engineering and Construction 23.0 *Distribution and Transport 70.3 *Government 50.0 *Mining and Quarrying 62.0 nilOther

Total: 369.9 * *

(As percent of total)

(Agriculture) (22.4)(Mining) (16.8)

Note: * The value added by these activities has not been taken intoaccount in evaluation of the project. If included on a percapita basis, they would increase the value added by theproject area to G$63.4 million or 17 percent of the total.

a/ Bank of Guyana Annual Report 1967.b/ IBRD Appraisal Mission estimates.

August 2, 1968

ANE 1Table 2

GUYANA

SEA DEFENSE PROJECT

Value of National Exports and Production in Project Area (1966)

a/ Production in b/National Exports - Project Area

1966 1966

C-$ 000 --

Agriculture

Sugar 50,132 20y568Rice 2h,868 2,662Other 9,390 2,946

Sub-total Agriculture: 84,390 26,176

Beverages and Tobacco 3,500 *SC

Manufactured Goods 6,740 *Miscellaneous Conmodities

and Transactions 1,269 *

Minerals 87,532 nilFuels, Chemicals 1,529 nilMachinery 1,548 nil

Total: 186,508

Note: * No estimates available: These items have not been taken intoaccount in evalu4ting the project.

a/ Bank of Guyana Annual Report 1966.W/ IBRD Appraisal Missim Estimates.cl Some run is manufactured in the project area.

August 2, 1968

ANNEX 1Table 3

GUYANA

SEA DEFENSE PROJECT

Govenuent Revenues and Re-venues from Pro ect Area1960-1965 and 1966

Total Revenue -S Estimated RevenueAverage from Project Area -

1960-65 1966 196 , of Total-------- e000-.s _-_____

Taxation of Companies

mining 3)3200 3,100 nil -

Sugar 6,300 l,0O.90c 570 / 30Other 5,600 10,800 1,188 11

P,ersonal Taxation 5,900 9, 200 1,4¢72 16

Other Taxation & Receipts Ul,900 13,000 2,979 21

Excise Duties

Rum and beer 6,600 9,200 1,472 16Other 600 800 128 16

Taxation of E>xternal Trade

BWort duties: Sugar 290 270 78 29Other 910 1,330 160 12

Import duties 22,100 32,500 5,200 16

Total 63,4oo 83,000 13,2147 16

a/ IBRD Economic Reilew. Report WN-169b; April 1967.bI IBRD Appraisal Missicn estimate.c/ Sugar company tax;tion was low in 1966 because of unusually high allowances

for investments in factory rehabilitation, etc.

August 2, 1968

ANNEX 2Page 1

GUYANA

SEA DEFENSE PROJECT

COASTAL EROSION AND SEA DEFENSES IN GUYANA

1. A thorough investigation into the hydrography and oceanography,the hydraulics and sedimentology of the coastal area of Guyana, mainlyin the vicinity of the Demerara River, was carried out in 1962 by theDelft Hydraulic Laboratory in cooperation with NEDECO. The Bank actedas executive agent for the UNDP Special Fund for this project.

A. CYCLIC EROSION

2. The report on the Demerara Coastal Investigation shows thatlarge mud banks (called macro-ripples) are joined to the coast at inter-vals of approxiaattly 25 miles. In the troughs between these local banks,waves and moderate swells occur from the northeast, resulting in erosionof the beach material on the western side of the troughs. There are noswells on the eastqrn side of the trough, because of the dampening effectsof the sling-mud Y. The macro-ripples move in a westward direction ata rate of about three-quarters of a mile per year (mpy) causing theerosion of the coast line to move westwards at the tame rate, i.e. theerosion cycle for any one area is about 30 years. As the macro-ripplemoves on, erosion is followed by a period of accretion.

3. Although it is possible to foresee from this pattern when anarea will feel the effects of intense erosion, it is difficult to predictaccurately when the erosion will actually affect sea-defense structures.This depends upon the actual widths of foreshore at mean high tide, thetype of beach material, the intensity of wave action and the duration ofwave attacks.

4. Erosion may continue in the same area for as long as six yearsor more and may even extend back eastwards into an area where accretionhas already begun, in spite of the general 3/4 upy westward movement.Such conditions have actually been experienced.

5. Hydrographic investigations of the East Demerara Coast indicatethat within the next three years the erosion cycle will affect the areafrom Beterveragting bo Georgetin. The attack will continue over a periodof at least ten years in varying degrees of intensity, and new sea defenses

y/ Sling-mud is one of the most remarkable phenomena of the Guyana coast.

It is formed by the orbital movement of water particles stirring upthe partly liquid, partly plastic mass of mud resting on the seabed.The mud particles are moved, consuming so much energy that the wavesare dampened out. Areas of sling-mud can be readily spotted from theair and their presence is easily detected from small boats. Theirarrival usually heralds the beginning of accretion.

ANNEX 2rag-e 2

are urgently needed. Further east along the coast between Ennore andNootenzuiil, where ascretion had begun, severe local erosion is attackingthe inadequate defenses and new defenses are urgently required.

6. Little hydrographic data have yet been collected on the WestDemerara Coast and the exact pattern of erosion is not known. The patternis not the same as that on the East Coast Demerara because the Demeraraand the Essequibo rivers influence the erosion depth on the foreshorebut further investigations are required to determine whether a patternor cycle exists. Local foreshore erosion is taking place and many sectionsrequire imaediate attention.

B. WAVE CHARACTERISTICS

7. Most of the information available on waves and hydraulicconditions was obtained during the investigations carrid out by theDelft Laboratory in 1960-62. Most of these investigations were carriedout on the East Coast of Demerara and in the vicinity of Georgetown andthere is very little informat.ion on other parts of the coast. Informa-tion for other parts of the coast is urgently required for present andfuture construction and it is of utmost importance that the HydraulicsDivision acquire the necessary equipment to execute the required lmasure-ments as soon as possible.

8. The coastal plain between the Demerara and Mahaica Rivers isbuilt up principally of very fine colloidal clays, resting on sand andsand-clays. This clay belt also extends under the ocean for approxi-mately another 20 miles, and -it has a thickness of more than 100 ft inmost places. There is a rather flat continental shelf which is about150 miles wide.

5. The directici of the prevailing wind is north-easterly andits strength varies daily as well as yearly. The wind increases afterdawn and is fairly constant duLring the day, but after sunset it slackensagain. Wind velocities are greatest during the early months of the year,and smallest at mid-year. Wind speeds of 8-12 knots are very common,and extreme values at sea are roughly 5 and 20 knots.

10. The wind has a 'fetch' of several hundred miles, and is res-ponsible for the equatorial current which appears in the open sea offthe South American coast and runs fron south-east to north-west. Italso creates long ocean swells, which wash onto the continental shelf,and shorter local waves which are superimposed on the larger ones.Resulting fran the wind and waves there is a littoral drift along thecoast iroa east to west.

ANNEX 2Page 3

11. The tide approaches the coast from the north-east, is semidi-urnal, and has an amplitude which varies on an average from 4 ft atneap tide to 9 ft at spring tide (Fig. I). Rarely is the amplitudeas small as 3 ft or as big as 10 ft. Mean high water spring is 50.04CieorgetDown datum (GD) and mean low water spring (MLWS) is 46.24 GD.The Admiralty datum, from which fathom contours are measured, is 1.1 ftbelow the MLWS, i.e. at 45.14 GD. The highest tide so far recordedwas on ilugust 7, 1956 and reached a level of 56.24 GD. The directionof the tide is not always perpendicular to the coast, and thus alter-nating currents occur both perpendicular and parailel to it. Thesecurrents, along with the equitorial currents and the waves, act onthe coast and cause the regular movement of material which accountsfor the cyclic erosion pattern.

12. Waves along the coast of Guyana are of short period and theoriginal direction of propagation of deep seawaves is about north 2600east. There are two distinct periods of wave activity; a rough periodbetween November and April and a calm period for the rest of the year.During the rough periods wind speeds exceed 20 ft,per second with awave height of 4 ft in a period of 10 seconds. During the calm periodwinds are 15 feet/second with a wave height of 1.3 ft in a period of 7.5seconds.

13. The predominant factor affecting the intensity of the waveenergy is the presence of sling-mud resulting in varying wave patternsover a given area. The maximum intensity of wave action is felt inthe center of the gap between two adjacent banks of sling-mud. Wavestravelling over the sling-mud are weakened, affording protection to theareas that are in their geometric shadow. The presence of the fourlarge rivers also has an effect on the wave patterns, particularly duringthe rainy season, when the flows of the rivers are at their maximum.This is mDst noticeable in the areas between the Demerara and theEssequibo rivers.

14. In the areas of maximum wave energy the largest orbital velo-cities appear and as a consequence these are the areas of heaviesterosion. The level to which the foreshore may drop during erosiondetermines the type of construction to be used; as the lower the fore-shore the deeper the water and the greater the wave action.

15. Wave characteristics play an extremely important part in thefinal selection of the type of wall to be built in any particular area.They determine to a large extent the type of coping, depth of toe piling,type of revetment and foreshore protection to be constructed. No accuraterecordings of wave heights incidence on the exposed sections of the wallare available. Designs were based on a 6-ft wave with a nine secondperiod, as recommended by the Delft Laboratory.

ANNEX 2Page 4

C, EX.ISTIN SEA DFENSES

16. The present day sea defenses comprise:

Miles

Natural shel reefs, sand bars andclay banks 25.2

Earth embankments 132.2(ld walls, sheet, jwnd timber piles 40.1New walls 5.Groynes, other structures or un-

protected, apprca: 67.5

270e0

Earth Dibanknents

17 These embankzmnts, giuarded by a wide foreshore, are locatedwell away from wave action, and are mainly to prevent flooding by thesetting of the high tide. The crown level of the embankment is 60.00GD and is designed on a 1:3 slope. Such embankments will withstand theincoming tide even when the foreshore is eroded to the level of 49.00GD. T'he top of the embankJent is 10-16 ft wide to accommodate con-struction traffic.

COLd Wals

18. CLd waUls are rehabiLitated. prior to their exposure to waveaction where predictirins shori that these wcrld be severe (as on theeast and west coast of Demeraxa). Depending on the state of the oldwalls, rehabilitation is done in two stages - the reconstruction ofthe lower section, i.e. toe piling and revetmnent (to a level between55.00 and 60,00 GDW followfed by the reconstruction of the upper section.

New Walls and iavetment

19. These structures are built on an earth embankment where furthererosion threatens the safety of the embanknent aad when repairs becomeimpractical. The height, of walls and revetments are designed to with-stand fullyr the forces of the sea.

20e Groynes, alt.hough used successfully for sea defenses in manycountries, have little effect o foreshore conditicnsin the project area wherethe material is mainly clay, as the erosion in the lee of the currentmay undermine the structure. Ths has been proved by experience and

ANNEX 2Page 5

during investigations made by the Delft Hydraulic Laboratory. In sandyareas of the Essequibo River coast, however, groynes have proved success-ful.

D. DESIGN OF EYdUNK1ENTS AND NEW WALLS FOR THE PROJECT AREA

21. The design of sea defense embankments deals principally withfoundation stability, as lack of such stability is the main reason forfailure of embankments or their foundations.

22. The soil comprises a thin top layer of firm clay, and below1. very poor clay with a high moisture content. Once the material ofthe sub-soil is dried out it forms a firm clay which, with proper con-paction, can develop a sheer strength of 800 lb/sq ft. Without treatmentthe top soil has a sheer strength of approximately 450-500 lb/sq ft andthe sub-soil a strength of 120-220 lb/sq ft.

23. Because of the low sheer strength of the clay, the commonesttype of failure is a rotational slide (slip circle). This occurs mainlywhere the level of the foreshore drops below 45.00 GD. BEbanlkments areconstructed in layers allowing for consolidation before the followinglayer is put on. The limit in height to which the embankment could bebuilt without improving the sub-sooil is 60.00 GD, i.e., 9 ft above theexisting ground level. To build a higher embankment world require stageconstruction over 2-1/2 years.

22. In areas where overtopping occurs, protection is given to thelandward slope of the embankment. Heavy rainfall too can form channelsin the landward slope of the embankment, accelerating erosion and in-creasing the likelihood of failure. Where grass does not grow because ofthe salinity of the soil, artificial protection of these slopes must beprovided.

25. Oa the seaward side, the embankment is protected by a revetmentof boulder embedded in cements placed on a layer of polyethylene sheeting.The latter prevents the washing out of the clay particles in the eventof cracking of the revetment, and maintains a constant moisture contentof the ground thus reducing the possibility of settlement. A three-inchthick layer of sandcrete is spread over the polyethylene sheeting to preventdamage during the construction of the boulder revetment.

26. At the toe of the embankment, 12 to 15-ft long steel sheet-pilesare driven to 48.00 GD. The sheet-piles add stability against slippingand prevent scouring from under the embankment when deep erosion occurs.

27. Where it is expected that the foreshore will erode below 48.00GD, Gabion baskets are placed 26 to 52 ft seaward of the sheet-piles.These stone-filled baskets prevent scouring by return currents and provide

ANNEX 2Page 6

protection at the node of the wave where erosion forces are greatest.In addition they further the stability of the embankment by suppressingthe flow of the soft clay an.d intersecting the slip circle. In theevent of the severe drop of the foreshore the baskets are flexibleenough to bend and assume the shape of the eroded foreshore thus givingadded protection to the toe of the wall.

28. Where heavy wave att.acks are expected, a berm 2 is incorporatedin the sea wall. The berm ass:ists in breaking the waves thus reducingthe force of uprush and decreasing the overtopping. Landward of theberm or at end of the boulder slope is a reinforced concrete copingstructure with a curved return wall to turn back the wave uprush.

29. The designs for Phase 1 of the Sea Defense Program are basedupon local experience but include many features proposed in the UNDPstudy and in a report by the U.D Army Corps of Eagineers. The designs havemany common features which are intended to overcxe the normal causes offailures, i.e.,

(a) Unequal volume changes of moisture content in theembaakent, which lead to cracking and erosion ofmeterial fronm >>hind the wall facing.

(b) Differential settlement due to consolidation, andslipping due to foundation failures, which leadto overtopping and fracture of the coping by waves.

(c) Undermining of the wall by wave attack or by rainand floodwaters on the landward side.

30e Three desigrs are proposed for project works:

(a) type I is for use on those parts of the East Coast whereoGi&nditions are most severe, i.e., where the sea bedshelves steeply and a prolonged erosion attack is predictedwithin the next few years. Hydraulic tests have shown thatthe proposed wave screen will prevent overtopping by a2ULbut 2 percent of predi Xted waves. A flexible mattress ,ofstone-filled gaebions A/ protects the toe of the revetment.

1/ Bermi: a level seetion, paved with concrete or with boulders embeddedin concrete, at the top of the sloping revetment.

2/ Baskets of plastic-coatedl steel mesh measuring 4 x 1 x 0.3 m. ¶heyare assembled in situ and -vired t,:gether before being filled withstanest lids MiiT;=H secu.red with wires. Gabionr aLre patenteditems, imported from Italy: the total cost of gabions included inthe project is US$360,000.

AINEX 2Page 7

The estimated cost of Type I walls is G$626 per runningfoot (US$1.7 millian per mile).

(b) Type 2 is for use under less severe conditions on theMat oast. The revetment is the same as Type I, but thecrost is 0.5 ft lower and the wave screen less elaborate.Siace Type 2 walls will be used only in areas under localattack, the gabioa mattress will not be included at thistime IWt it can be installed, if necessary, before thenext cyclical attack, expected in 1975/7. The estimatedcost of Type 2 walls is G$362 per running foot (US$1.0 millionper mile).

(c) T is for use only on the West Coast where hydrauliccond tions are not severe. No berms or gabions are neces-sary but, because of large variations in the profile ofthe existing embankments, additional bulkheads are neededto support the revetment. The estimated cost iF G$297-per running foot (US$0.8 million per mile).

Accessibility to Project Sites

31. There are access roads to al1 the work sites but these aremainly fair weather roads, impassable during a prolonged period of rain.At some sites the embankments of the existing sea defenses could beutilized as access roads though heavy rain could turn them into quagmiresand camae damage to the embaniments. The cost of paving the access roadshas been included in the cost of the project.

32. In some cases because of lack of soil for embankments, materialis obtained by digging facade trenches. The cost of bridging these trencheshas also been included in project costs.

Working Under Tidal Conditions

33. The tides in Guyana are semi-diurnal and it is possible to worktwo periods per 2h hours on tidal construction. Because of the prevailingwinds, high tides come in quickly but recede very slowly, limiting theworking time to a maximum of six hours.

34. In some areas where the foreshore falls below 48.00 GD furthersubstantial empoldering of the working area is sometimes necessary ifwork is to be carried out at every tide, otherwise work can only becarried out for six to eight days per month during the p.pring tides.Even with a dofferdam around working areap substantial pumping stillhas to be carried out. Night work would be feasible only if conditionsfor proper control can be guaranteed. 'Whenever possible, therefore,

ANNEX 2Page

efforts should be made to construct walls before the erosion of theforeshore makes work under tidal conditions necessary. In most areasif work is started immediately, it can still be executed in relativelyeasy conditions. However, at some places local erosion has gone too farand tidal work will be requLred.

E. SURVEYING, AND HYDROGRAPHIC SURVEYS

35. Records show that the first surveys of the shores of Guymawere made prior to 1841 by the. Spanish Navy, and in 1852 the firstchart of the entire coastline was prepared by the British Admiraltyfor navigation purposes. In 1.858 the British Navy surveyed the estuaryof the Demerara river but it swas not until 1957 that a resurvey of thecoastline east of the Demerara river was started. The last assignmentby the Admiralty was carried cut in 1963.

Surveys

36. In 1933 a disastrous breach occurred on the East Coast ofDemerara resulting in a total loss of a stretch of land of some 10,000ft long and 1,500 ft wide. This led to the first hydrographic surveyby the Public Works Department (now the MoWH) in the area at presentsuggested as a Bank project.. This survey extended seaward to a depth ofthree fathoms. Further surveys were carried out regularly and laterextended to include parts of West Coast Demerara.

37. In their report, the Delft Hydraulic Laboratory recocendedthat the entire coastline of' the country should be surveyed annuallyto form the basis of general sea defense planning, and that the sectionlines should extend 10 to 12 miles seaward at intervals of about twomiles. In addition an annuual survey of the areas where sea defensewalls are constructed is recommended in order to check conditions andto provide adequate knowledge of the coastal changes necessary for propermaintenance planning. The MoWN has been unable to fulfill all of theserecommendations because of lack of adequate equipment.

38. During periods of erosion, the 5 and 6 fathom lines are foundwithin 6 to 8 miles of the shoreline but it is unknown where on thecontinental shelf the erosion ccmmenced. It is also unknown how farout thLe build-up extends on th-e shelf during the accretion cycle. Afuller knowledge of these pheaacmena can be obtained only by extendingsurveys further off-shore. Such surveys would require larger craft thanthe in-shore launches now used by the MoWH. The 12-year '3ea DefenseProgram included a proposal for the purchase of an off-shor, surveyship at a cost of G$l million (US$0.5 million equivalent). However,the Bank does not consider that such a large expenditure can be Justifiedat the present time, and suggests a smaller survey boat costing G$150,000(US$75,oo0).

Ceptemlher 6, 1968

ANNEX 3Page 1

G U Y A N A

SEA DEFENSE PROJECT

THE 12- YEAR SEA DEFENSE PROGRAM1

1. The 12-Year Sea Defense Program 1/ is an attempt to "definethe sea defense problems of Guyana and to present realistic and non-ambitions prograrmes extending for the next 12 years to solve theseproblems. 1'

2. The report includes detailed studies, including designs andsample economic surveys, of the works to be included in Phase 1 (1968-71),Unavoidably, the proposals for later phases are merely indicative. Phase1 includes provision for technical, hydrographic and economic studiesto prepare detailed designs and feasibility studies for later phases.

3. The aims of the program are:-

a) to provide a reasonable degree of protection to allparts of the coastal plain,

b) to reclaim about 10,000 acres of land, mainly tidalsalt flats, for agriculture and housing,

c) to improve drainage in selected areas

4. The works required to achieve these objectives are estimatedas follows:-

Phase 1 Later Phases Total1968-71 1972-79 1968-7

- - - - - - - - -(miles )-

Rehabilitation of existingsea walls 3.4 9.7 13.1

Construction of new walls:-

on sea coast 9.1 5.8 14.9on rivers - 4.5 4.5

Construction of breakwater 1.4 - 1.4Construction of earth

embankments 26.5 53.4 79.9

40.4 73.4 113.8

New drainage outfalls (nos) - 13 13Area reclaimed (acres) 160 10,000 10,160

17 ~IAProposed Program of Sea Defense I&Jorks in Guyana Vol. 1 higineeringand Vol. 2 Economics". Hydraulics Division, ŽMnistry of Wlorks andis,draulics, Georgetown, February 1968.

ANMEX 3Page 2

5. The original estimate of the cost of the 12-Year Programwas G$72 million (US$36 million equivalent), of which G$21 millionwould be included on Phase 1. However, many necessary items, suchas consultants'fees and contractors profits, were explicitly excludedfrom the estimatem. The revised estimate,prepared on the same basis asthe revised project costs, is G$93 million, comprising:-

Phase I Iater Phases Total1972-79 l768-79

.(G$ million))-

Greater Georgetown a/ 9.3 2.7 12.0Demerara Coasts 19.7 15.3 35.0Other Areas 4.5 41.5 46.0

33.5 59.5 93.0

a/ Greater Georgetown includes suburban areas outside the present towncouncil boundary and coaprises SDi 1-20

6. The areas select,ed for much of the investment in Fhase 1 -Georgetown aud the Demerara Coasts - were chosen a priori because oftheir high economic value. In these areas, the cyclic erosion patternprovides a basis for establishing priorities within the Program. Theexisting defenses and proposed works in these areas are shown in Table 1.

7. The need for considering the Program as an entity in evaluatingthe proposed project is illustrated in Table 1. For examplej the projectsea wall on the Fast Demei'ara Coast at SD# 22-23 and the adjoining sectionat SD,, 33-35 are interdependent. If SD#' 33-35 is not built, the seawill breach thie embankment. The resulting floods (unless containedby very expensive emergency measures) will spread laterally and willnot only affect production and property immediately behind the projectwall but will also erode the project embankm2ent from behind, endangeringthe wall itself.

Ai2gust 2, 1968

G il Y A N A

S_A !IEENSES 'ROjF.CT

12-Year Sea Defense Prograr

Cyclical5i stri ct Secti on Existf np Defense Di stance Inland Erosion Expected Pronosed Construction Pronosed Source

TsD77- from shore on shore on defense Year Tyoe / of finance

Greater 1-4 Old vall, no coping 250-300 1970 1971/2- - 1970/1 b/ bI

G 4own I-8 Old wall, with coping 0-250 1969 1969/71 1969/70 c/ b/e0sltp 3 j 8-9ditto 250 1969 1971/2 1968 U Force a/c

9-16 Earth bank 250 1968 1969/70 1968/70 4 UK

16-20 Concrete wall 1,900 now 1972/73 1972/3 4 (Phase 2)

East Demerara 20-22 Concrete wall 1,900 nov 1972/73- . 1972/3 i (Phase 2)

(Map 37 22-33 Earth bank and old walls 1,S00 now 1970/73 1969/71 1 IBRD

33-35 Earth bank Lho nov 1968/69 1968 1 Force a/c

36-39 Now Type 1 walls 0 - now - -

39-h Earth bank and old walls 0-1,000 1980 1981 1978 ? (Phase 3)

h-64 nWalls built in 1950/60 0-1,000 1978 1078/80 ).978/80 ? Phase 3)

64-73 Earth 'ank 100-200 1971/4 197LI/5 1969/71 2 TIRD

73-74 Earth bank 100-200 (local) (local) 1968 2 Force a/c

7h-75 Old wall 100-200 (local) (local) 1969/71 5 IBRD

i 5-92 Earth bank and old walls 1971/A 197?/5 1974/5 ? (Phase 2)

West Demerara 2-3 Old wall 500 1975 1977/81 1971 ? (Phase 2)

(ilan 4l) T3-4 Earth bank Z. (local) (local) 1971 6 Fo:rc R/c

10-11 Earth bank 600 (local) (local) 1077 6 For,

11-15 Old Eall 600 1974/9 1977/81 ]97 ? (?nase 2)(2-23) (Rehabilitation of banks) - _ - 1968 - Force a/c

22-24 Earth bank and old vall - 1975/9 1977/81 1972 7 (Phase 2)

24 Old vall - (local) (local) 1969 6 UK

25 Old wall - (local) (local) 1971 6 Force a,/o

25-32 Iart)- bank33-34 Old wall 600 1975/9 1977/81 197i 7 (Phase 2)3s-52 Old vall - (local) (local) 1969/71 6 UK

53-57 Eartn bank 100-1,000 1975/9 1975/81 1974/9 ? (Phase 2 and 3)57-60 Concrete wall 0 - - - -

60-62 Earth bank 300 now 1970/1 1969/70 3 IBRD62-4 Earth bank 1,600 nov 1980 - -

64-68 None 0-200 nov 1969/70 1969 3 I3RD58-70 Old walls and banks70-74 Old walls and banks 100-300 1973/7 1973/7 1973 ? (Phase 2)

75 New wall76-77 Earth bank 200-500 nov 1971 1969/70 3 IBRD

78 Earth bank 0 now nov 1968 3 Foce a/c78-90 Earth bank aud river defenses -

NCT3S: a/ Details of types of wall are given in Annex 2 and Figs. II and III. g

Z/ Proposals for the defenses of the 9eorgetown esplanade have not heen finalized: Drovision for the cost of studies is made in the co

Drooneed -roject.C/ Rehabilitation of this sect:on is now in -ro.ress (Force a/c) (DX

August 2, 1968

GUYANA ~ ~ ~ ~ NNX

G U Y A N A

SEA DEFENSE PROJECT

Project Area - Crops and Cropping

East Coast West Coast ProjectDemerara DGmerara Area

- - - acres - - - - - - -

Sugar cane: estate 18,350 13,522 31,872: outgrower 2,398 358 2,756

Rice: main crop 1,868 7,127 8,995(second crop) (342) (5,527) (5,869)

Coconuts 6,1407 3,381 9,788Ground crops 593 409 1,002Gardens 1,824 875 2,699Pasture 490 314 804Rough gra4ing 1,468 2,788 h4,256Fallow, canals, waste 13,602 8,226 21,828

Sub-total, agriculture 47,000 37,000 84,000Non-agricultural uses 12,000 5,000 17,000

GROSS AREA 59,000 42,000 101,000August=== 2====1968 = ==== ===

August 2, 1968

GUYANA

SEA DEFENSE PROJECT

Estimated Project Costs

ForeignLocal Foreign Total Exchange

Currency Exchange Cost Percentage- - - -GT - - -

CONSTRUCTION

Preparatory works 230 230 46o 50

East Coast Demerara:21,230 ft sea wall 2,730 5,o60 7,790 657 drainage outfalls 100 200 300 66

2,830 5,260 8,ogo 65

West Coast Demerara:5,000 ft sea wall 41o 600 1,010 602 drainage outfalls 0 . 80 120 66

45o 680 1,130 61

Engineering fees, supervision(15 percent) 690 690 1,380 50

Sub-total, Construction 4,200 6,860 11,060

PURCHASE OF EQUIPMENT

Survey launch - 150 150 100Navigation aids 120 120 100Wave recorders (3) 50 50 100Miscellaneous instruments 120 120 100

_ h4O 40o 100

TESTS AND STUDIES

Consultants' fees 100 240 340 70

Laboratory and test fees:Sea wall design 200 200 100Breakwater 260 260 100

-6o 060 100

Sub-total, Tests and Studies 100 700 800 88

Sub-total, Project Works 4,3O 8,000 12,300 65

CONTINGENCIES 700 1,000 1,700 58

INTEREST DURING CONSTRUCTION 950 950 100

TOTAL ESTIMATED COST 5,000 9,950 1T,950 66

(US$oo00 Equivalent) (2,500) (4,975) (7,h75)September 6, 1968

AINNf 6Page 1

G U Y A N A

SEA DEFENSE PROJECT

RECOVERY OF PROJECT COSTS

1. The Sea Defense Ordinance, 1933, was amended in 1937 to providethat:

"From the 1st January, 1937, all costs and chargesincurred in the construction or maintehance of any seadefense together wiQt all expenses of administration shallbe defrayed from such moneys as may be provided from timeto time by the Legislative Council:

Provided that ..... the City of Georgetown shallcontribute ..... by payment annually ..... of G$2,500.00".

2. The 1967 IBRD mission, in recommending that the level ofexpenditure on sea defenses should be raised to G$4-5 million annually,stated:

"This is essentially a problem for central budgetmanagement. However, it raises such questions as towhether a general welfare type of infrastructure such assea wall defenses, with particular assignable value toagricultural landowmers and other property holders on andjust back of the sea defense area, might not warrant theapplication of special benefit taxes as a source ofadditional revenues to finance both part of the construc-tion cost as well as maintenance costs of such defenses.The mission has raised such questions with the Governmentof Guyana without itself having established or taken anyfixed position; but it thinks that such questions deserveserious consideration by Government."

3. It may be noted that special benefit taxes are used in Guyana.For example, the Drainage and Irrigation Board has powers, under a1940 Ordinance, to apportion the cost of construction, maintenance andadministration to proprietors and local authorities in declared areason an acreage basis. There is little doubt, however, that a similarspecial benefit tax for sea defenses would meet severe popular opposition.Sea defenses are regarded as a "national war effort against the sea',and their cost is viewed in the same light as conventional defenseexpenditures.

4. Even if this deep-seated popular view could be overcome, andthe Sea Defense Ordinance repealed or revised, there would be seriouspractical difficulties in apportioning a special benefit tax on an

ANNEX 6Page 2

equitable basis. The beneficiaries of a sea defense project cannot be desig-nated with the accuracy that. . possible, for example, in a drainage andirrigation scheme. However, since most cf the population live and work belowsea level, almost a:Ll may be said to be beneficiaries of the Sea Defense IProgram of which the project is. a part. The seasonal estate workers or smallfarmers, who pay least in general taxes, may benefit least since they have1ittle to lose and could eke out a liveLihood from subsistence farming in theriverain areas or the interior. At the other end of the scale the sugar es-tates and entrepreneurs, who contribute heavily to general revenues, willbenefit most from the completed Sea Defense Program.

5. Since the Program must proceed in a series of projects, it is inevi-table that sonme areas will benefit from efficient defenses before others,thuF strengthening the case for a special benefit tax. However, the experienceof the Drainage and Irrigation Board has shown that, under present circumstances,it is not possible to collect these taxes equitably. Government itself paysabout 55 percent of the taxes apportioned by the Drainage and Irrigation Board:the actual collections from private proprietors and local authorities is nomore than 20 percent of the tax due and thu- there are very large outstandingarrears. Under the preEent Local Authority system, the amounts that couldbe raised by a special benefit tax on sea defenses would be small lJ and theco.st of collection might well exceed the additional revenues generated.

6. Government is well aware of the shortcomings of the present LocalAuthority system and two measures to improve it are awaiting presentation tothe Legislature../ If these measures are enacted, the Greater Georgetown areawill be unified under alsingle authori-ty; local district councils will be setup for the whole country; and ratable values assessed on a uniform basis. Itwill then be possible to improve the efficiency of local tax collection andto include sea defense benefits as an element of ratable values. However, thepassage and implementation of the proposed legislation - which are based upona report written prior to independence - will be a lengthy process. Most ofthe population may well be benefitting from the cea Defense Program by thetime that a special benefits tax could be collected efficiently in indiVidualproject areas.

7. !While the imposition of a special benefit tax to recover the costof the project would in principle be desirable, des ite the aforementioneddifficulties, in the case of the proposed project, the same effect in essencewould be achieved by increases in general revenues. Nearly 95 percent ofGuyana's population resides in the coastal areas and is mostly concentratedin the project area of East and TWest Demerara. The sea defense works affordprotection not only to the lands immediately behind such works but to theeconomy of the entire East and West Demerara areas. (See Annex 7). In these

I/ It would be relatively easy to impose a special benefit tax on sugarestates and, perhaps, rice mills but it would. be inequitable to do sounless other re.sidential and rural areas were also taxed.

2/ The Municipal and Districts Council Bill and the Valuations for PatingPurposes Bill.

ANNEX 6Page 3

peculiar circunstances, where in the project area there is concentrationo population and economic activity, a recovery of the cost of the proposedpioject through increases in general revenues would be more or less tantamountto recovering the costs from the direct beneficiary of the project.

Program Costs and Revenues

8. The average annual expenditures on sea defenses in recent yearsare compared with actual and expected general revenues in Table 1. Theestimates assume that revenues will increase by seven percent per year until1971 and by five percent thereafter. Provided thlat Guyana can obtain externalassistance to cover 65 percent of the cost of the Program, the net expenditureon sea defenses, including debt service costs, 2/ will be about 2.8 percentof the estimated revenues. If it is assumed that extern;l assistance wouldbe obtained only for works in Phase 1 and that all subseqluent works would befinanced fron local resources, the net expenditure (including debt servicecosts) would average G$8.9 million per year, equivalent to 5.6 percent ofrevenues, during 1972-79.

9. The IBRD 1967 Economic Mission 9 considered that the currentaccount surplus could be raised fran about G$4 million in 1967 to G$8 millionin 1969 and G$13 million in 1970-72 provided that increases in currentexpenditures were held to five percent per year (as compared to 10 percent inrecent years) and strenuous efforts made to reduce direct and indirectsubsidies and to improve efficiency of tax collection. Savings of publiccorporations (which were expected to rise for G$4 million to G$5 million by1970-72) and internal borrowings (a constant G$4 million) would increase thetotal internal resources to about G$24 million (see Table 2). During 1965-67,sea defense expenditures were financed entirely frmn local rescurces, accountingfor nearly 24 percent of the total available. If external assistance isobtained for an average of 65 percent of the cost of the Program, the proportionof total internal resources used for sea defenses would fall to 15-17 percent,includirng loan service costs. If 70 percent of the cost was financed externally -i.e., the level assumed by the IBRD Economic Mission - the proportion of totalinternal resources devoted to sea defenses would be 13-16 percent.

1/ Debt service costs have been estimated at an average of six percentover 25 years, including five years grace in repayment of principal.

2/ IBRD Report WH - 169 b, Chapters IV, V and Table 27.

September 6, 1968

GUYANA

SEA DE?ENS. PROJECT

Program Costs and Revenues

Actual Estimated Estimated1965-67 .-- 1268-71 1972-79 .

Cost Revenue Cost Revenue Cost Revenue-------------- G$ '000 per year------------------------

Georgetown - 21,300 2,330 27,100 320 41,000

East and West Dazmerara Coast 2,163 13,200 4,930 16,900 1,905 25,600

Other Coasts 774 NA 1,140 NA 5,175 NA

TOTAL SEA DEFENSE EXPENDITURE 2,937 8,400 7,400

Less: external loans and granta - 5,460 4,800

Plus: debt service costs - 1,500

NET SEA DEFENSE EXPENDITURE 2,937 2,940 4,100

Other Revenues 47,500 61,400 931 00

82,000 105,400 159,600

___-----------------percent of total revenues----------------------

Total Sea Defense Expenditure 3.5 8.0 4.6

Net Sea Defense Expenditure 3.5 2.8 2.6

August 2, 1968

ANNEX 6Table 2

G U YA N A

SEA DEFENSE PROJECT

Program Costs and Internal Resources

Actual Estimated Estimated165>-67 1968-71 1972-79--- G$'000 per year- - - -

Internal Resources a/

Public savings: Government 3,100 11,500 15,000: public corpora-

tions na 4,oOo 5,000Internal borrowings and

other b/ 11,300 4,000 .000

Total internal resources 12,000 19,500 24,000

Internal Resources Usedfor Sea Defenses c/ 2,937 2,940 4.100

(percent of total) (24) (15) (17)

a/ IBRD Report WH - 169 b, Table 27b/ Excluding special distribution of BCCB assets in 1967 (GS3.5 million)c/ See Annex 6 Table I

August 2, 1968

ANNEX 7Page 1

GU Y A N A

SEA DEFENSE PROJECT

EVALUATION OF ECONOMIC BENEFITSOF TBE SEA DEFEINE PROGRAM

1. The economic return of the Twelve-rear Sea Defense Programhas been evaluated by two methods, (a) on the basis of annual productionand imputed rentals that would be lost if the project area were inundatedand eroded, and (b) on the basis of the estimated capital cost of repla-cing houses, factories, agricultural land and other assets elsewhere.In each case, these values have been compared with the cost of carryingout not only the Program itself but such subsequent replacements as seemnecessary to ensure the safety of the project area. In each case ithas been necossary to make assumptions regarding the rate at whichproduction would be lost, or replacements required, due to the ingressof the sea.

Sea Defense Costs for Economic Evaluation

2. In estimating costs for future phases of the Program andsubsequent works, it has been assumed that unit costs will remain constant,i.e., that reductions in quantities and other economies resulting fromstudies of improved designs will offset expected price escalations.Table 1 shows the estimated expenditure on sea defenses in the projectarea until 1983: thereafter, only maintenance costs (estimated atG$2.00 per foot run per year) would be incurred. Because of country-wide unemployment and underemployment, the opportunity cost of laborhas been taken as 0.25 and other minor adjustments have been made inestimating the eoonomic costs shown in Table 1.

Rate of Loss of Production or Replacements Required

3. If no works were undertaken to maintain and repair the exiatingsea walls, breaches would soon occur and, in a short time, sea waterwould drastically reduce yields in all agricultural land below sealevel: in time, soil salinity would increase to the extent that croppingwas no longer possible. Simultaneously, land would be lost by erosion:comparison of old British Admiralty charts show that the East CoastDemerara coastline alone has been eroded at an average rate of 160 acresper year since 1784., but this average masks a series of spectacularlosses.

4. Even if very strenuous efforts were made to maintain existingdefenses, the ultimate result would be the same, since many stretchesof coast in the project area are protected only by earth embankments.

5. Historical data gives no indication of how long productioncould continue in the coastal plain under either circumstances. For

ANNEX 7Page 2

purposes of evaluation, it has been assumed that production would cometo a standstill after one erosion cycle, i.e., after each stretch ofcoast had been attacked and thz existing defenses therefore breached,at least once. Figure A shois two empirical curves which have beenpostulated to represent the :Losses with and without maintenance: theprobable course of events lies somewhere between the two curves andapproximates to a constant rate of loss, represented by a straight line.

A. RATE OF RETURN ON BASIS OF ANNUAL PRODUCTION

Agriculture

6. Although it is certain that the agricultural production of theproject area wiMl increase during the next 30 years, individual increaseswill be the benefits of individual projects and cannot be counted asa benefit of the Sea Defense Program. For the purposes of evaluation,therefore, it has been necessary to estimate only present production.Reasonably reliable data are aveilable for the main crops of the area,but it was necessary to make asslumptions for minor crops and livestock.

7. The project area produces over 30 percent (by value) of thenational production of sugar. The mean 1296 price level, on all markets,for Guyanese sugar was G$180 per ton fob Y but a price of G$168 per tonfob (535 per ton for 960 sugar) has been used for bhepurposes of evalua-tion because of uncertainties about the proportioning of future exportsbetween markets with differing pricing arrangements. Ecological conditionsfavor the Guyanese sugar industry by permitting two harvests per year.The industry has invested heavily in modernization of drainage and irriga-tion systems and of factories. Transportation and bulk storage and loadingfacilities are good. The future prospects for Guyanese sugar seem satis.-factory.

8. Rice accounts for 13 percent (by value) of the agriculturalproduction of the project area, although amounting to only seven percentof the national production. Large increases in both yields and value areto be expected fron on-gbing and propcsed programs. In 1966 Guyanareceived G$270 per ton on the regotiated Caribbean market but only aboutG$200 on the world market, wbi6h accounted for about 4 0 percent of exports.A price of G$254 per ton has been assumed for purposes of evaluation.

9. Details of the annual value of agricultural production of theproject area are given in para 6.07 of the report. If paid estate andrice-farm labor are considered as a production cost, the annual value isG$8.4 million, of which G$2.0 million may be ascribed to crop processing.However, most of the paid labor is unskilled and seBaonally employed.

1/ Trade figures show that l96 6 eprts conprised 129,000 tons to Britain

under the Negotiated Price Quota of the Commonwealth Sugar' Agreementat G$228 per ton; 54j,000 tons to the United States at a quota price ofG$212 per tcx and 96,000 tons to Canada at G$102 per ton (i.e., freemarket price plus Commonwealth preference).

ANNEX 7Page 3

The opportunities for alternative employment are very limited. Unemploy-ment in the project area is estimated at 20 percent and there is littleland of good agricultural potential left undeveloped in the project area.A case could therefore be made for including the G$7.5 million earned bypaid labor as an economic benefit of the project and alternative evalua-tions have been made in which labor is included as a cost or as a benefit.

Housing

10. Sample surveys were carried out in three areas of the projectarea to determine the rate of increase in numbers of houses since the1960 Population Census and to obtain estimates of the current marketvalue of different types of housing. No difficulty was experienced inapplying this data to the whole project area: details of numbers andvalues bave been given in para 6.09 of the report.

11. No data was available on the level of rents in the project area.The annual value of housing was therefore expressed as an imputed economicrent, using a rate of return on the current market value. Based upon themedium and long-term Government rates of 6.0 - 6.5 percent, and the privatemortgage rate of 7.0 percent, a conservative rate of return on capital ofseven percent per annum was used; however, evaluations were also made atfive and at ten percent per annum, the corresponding annual value of housingbeing:

Return on Annual ValueCurrent Market Value of Housing

percent onIfl3iF

5 12,5257 17,535

10 25,050

Rates of Return to Economy

12. Rates of return to the econoqy were calculated for the projectarea and for its two main constituent districts (see Table 2). If laboris considered as a cost, the rate of return to agriculture (includingcrop processing) at the 'expected' rate of loss ranges from 7.2 in EastCoast Demerara to 13.9 in West Coaht, averaging 9.6 for the whole project'area. If labor is considered as a benefit, the rate of return to agri-culture alane is about doubled, i.e.,, 19.0 percent for the whole area.

13. The rate of return is greatly increased if the annual valueof housing is included. At the 'expected' rate of loss, the rate ofreturn increases to 24.9 - 41.4 percent if labor is considered as abenefit, depending on the social rate used.

14 . It will be seen from Table 2 that there were considerabledifferences in the calculated returns for the two main sub-divisionsof the project area. Calculations were therefore made for the western

part of the West Coast District, This subsidiary area, physicallyseparated from, but economically dependant upon, the rest of theWest Coast was chosen because it seemed to be the least developed part

of the project area. Nevertheless, the rate of return to agriculturealone was similar to that of the other areas, although the return toagriculture plus housing was lower.

15. Table 2 clearly shows that the most important factor affectingthe rate of return is the assumptions that are made regarding the rateof loss that would occur if the Plrogram were not carried out. Unfortuna-tely, there is no evidence on this factor and the curves used are onlypostulations. However, it may be said with confidence that the rateof return to the economy from agriculture alone will exceed nine percentif sea water affects the whole area in thirty years. If the annual valueof housing is included, the return will probably exceed 24 percent.

16. Further calculations were made to determine the influence onthe rate of return of varying the cost assumptions. The alternativesused were:-

1. Actual project financial costs (ie., full cost oflabor ;Lncluded). This increases costs by about12-5 percent.

2. A reduction of 20 percent in costs

3. An increase of 20 Percent in costs.

The corresponding ;rates of retuni to the economy for the whole project

at the 'expected' rate of loss, are summarized below: the pattern ofchanges was similar for suib-divisions of the project area.

Costs Agriculture Agriculture Plus(percent of eco- OnLy Housing (7 percent)

nomic cost)_ncl. labor Excl. labor -Incl. labor Excl.labor

80 23.7 12.3 55.3 39.9100 19.0 9.6 41.5 31.9

112 17.0 8.3 36.1. 27.6120 16.1 7.8 33.8 25,9

17. If these figures are compared with those in Table a, it is

apparent that variations irL cost assumption's or inaccuracies in cost

estimates have much less influence on the rate of return to the economy

than the assumptions that are made regarding the rate of loss. If the

actual cost is 20 percent higher than estimated the rate of returns will

still be about 8 percent to agriculture alone) or about 26 percent to

agriculture plus hlousing even if all paid labor is included as a production

cost.

ANNEX 7

B. RATE OF RETURN ON BASIS OF REPLACEMENT COSTS

18. An alternative approach to valuing the annual production ofthe project area is to estimate the capital cost of replacing houses,factories, crops, etc. elsewhere. Outside the coastal strip the landis very infertile, but even assuming that the activities in the 10:,OOOacres of the project area were replaced in, say, the Canje riveraiaarea (an area proposed for future development and studied by UNDP SpecialFund project) the investment required to obtain the same production asobtained currently in the project area would be prohibitive. This ispartly because land in tUe project area is more fertile than elsewhere.It still produces fai'; yields of sugar cane without fertilizer aftermore than 100 years of continual cropping. It is also because thereturn on total capital invested is very low. The plantations wereconstructed at first using slave labor and later using cheap indentedEast Indian labor, and could not be replaced at so low a cost.

:L9. The orders of magnitude involved are about G$225 million foragricultural land including main drainae and irrigation and aboutG$125 million for processing facilities excluding the cost of any roadsand other infrastructure. The capital value of housing has been esti-mated at G$250 million, giving a total replacement cDst of about G$600million excluding schools, roads, etc. Assuming the 'expected' rate ofdamage without the project of one-thirtieth per year, the annual replace-ment cost would be G$20.0 million. If the replacement cost is takendirectly as the annual benefit then the rate of return of the projectapproaches infinity.

20. It is also possible to consider the capital replacement coston an annual basis. It assumes that the Government decides to abandon theproject area and to remove the 115,OOO inhabitants elsewhere. The costof reconstruction of G$600 million would be raised by the investmentopportunities foregone by the taxed community. At rates of 7 and 10 per-cent this is equivalent to a total project benefit of G$42.0 million andG$60.0 million per year respectively. The annual benefits obtained andrates of return of the project using this method are, as would be expected,rather greater than those obtained by estimating the annual value ofproduction lost. The housing benefits are the same.

Alternative Projects

21. Although there is a clear justification for building sea defensesto protect the project area, it does not necessarily follow that the projectproposed is the best method available either in financial or economic terms.Basically, there are two other possibilities of which the first would be topostpone all major replacement works until there was damage. The secondwould be to continue retreating slowly behind a series of low cost earthembankmants, as was done in the project area until the beginning of thepresent century.

22. There would be a case for delaying the project if it wouldnot involve any large increases in costs, because the funds allocatedfor sea defenses could be put into productive investment elsewhereduring the interval. There would also be a case if there was a possi-bility that not all the structures included for construction in theproject would in fact have to be buiilt. Neither of these are situationswhich are applicable to the project. On the contrary, construction islikely to be less expensive if ccnmenced earlier. This can be seenby considering the different lengths of sea defense in the project areain turn.

23. About 50 percent of the project expenditure is the replacementof 8000 feet of earth embankment and 3250 feet of old concrete wallbetween SD#22-23 in the East Demerara area. Construction is planned tobe coampleted in dry conditions before the full onset of the cyclicalerosion, which is at present reducing the width of foreshore by about300 feet per year. If construction was delayed beyond about 1971-73,it would have to be completed under tidal conditions at an estimated30-40 percent increase in costs, accompanied by an increasing numberof breaches, first in the earth embankment and later in the wall also.In the past few years, breaches have been successfully contained behindtemporary defenses and the major costs involved have been the costs ofrepairing the breach. These include the costs of erecting coffer dams,the cost of punping, and the cost of constructizg a new permanent seadefense as well as the indirect damage done to mechanical equipment fromworking in saline conditions, etc. Also, there is always the possibilitythat temporary defenses would not be able to contain a breach, particularlywhen as much as 8000 feet of earth embankment might collapse. In anyevent the whole length of the defenses from SD#22-23 would have to bereplaced in time with structures of equivalent strength to those proposedin the project.

2h. The remaining construction included in the project is in areasof local erosion. In East Demerara the earth embankents from SD#64-73and a small length of old waLl SD#74-75 are likely to breach if notrepaired before 1972. (the length in between SD#73-74 is already underconstruction as an emergency work). They would have 40o be replaced beforethe next cyclical ~irosion attack expected in 1975-7e The sea defensesincluded in tie project in West Demerara are at present all earth embankmnts.Here same of the constrtction in the proposed phasing will in any casehave to be made under tid4l conditions and any further delays would increaseconstruction costs considerabLy. Quite apart from the extra costs of work-ing under tidal conditions, there are significant economies of scale fromconstructing as long a length of wall as possible at any one time. Itwould be considerably more costly to return at a later date to a smallpart of exieting old wall, in the middle of a longer part of earth embank-ment than to construct the whole length a year or two earlier. Thus thereis no case for postponing the construction of any part of the project morethan is necessary, for the longer construction is delayed the greater willbe both the costs of construction and the greater the risks of a seriousbreach.

ANNEX 7Page 7

25. Somewhat related to postponing the project is the possibilityof substituting capital for labor. There would be considerable economicsavings if some of the 20 percent unemployed could be used effectively.However, the extra costs of providing adequate supervision for so largean amount of construction outweigh any savings made by using lessmechanical equipment. Also the only proven structural design acceptablerequires a high proportion of imported materials, which further reducesthe possibility of capital-labor substitution.

26. The second type of investment alternative would be a gradualretreat behind earth embankments. In the long run it would mean completelyabandoning the project area, just as if there were no project. His-torically it was the best solution so long as there was plenty offoreshore to break the force of the waves. Earth embankments could becheaply constructed and replaced further inland when they collapsed.Most of this area, which lies to the north of the railway was salineand there was little agricultural production. This no doubt explainspartly why most of the housing has been built north of the railway.

27. In general there are now no tidal flats remaining in frontof the present defenses in the project area. The retreat alternativewould entail moving the coastal defenses back as far as the railwayline in the early years of the project. The costs involved would mainlybe the annual value of housing north of the railway that would be lost.The capital value is estimated at G$154.4 million and annual value ofG$7.7 million, G$10.8 million and G$15.4 million at interest rates of5,7 and 10 percent respectively. However, the population living northof the railway derive their income from the agricultural land southof it. They would have to move their houses on to some of the agricul-tural land south of the railway to remain close to their work. Thiswould involve a loss of about 10,500 acres with production valued atG$2.0 million per year. The main road and all the infrastructurewould also have to be reconstructed south of the railway. After about30 years, another decision would have to be made whether to retreatagain, or to abandon the land completely or to construct permanent seadefenses. The alternative would preclude any long term developmentof the project area and cannot be considered seriously.

August % 1968

ANNEX 7Table 1

GUYANA

SE& DEFENSE PROJECT

Cost of Program and Subsequenu; Worksin Project Area

Year Total Total Totalof length financial economic

construction in cost costmiles G$'O0O G$'GOCC

East Coast DemeraraDistrict 1968 1.2 3,179 2,797

1969-71 4.0 1O,650 9,3721972-75 4.1 4,474 3,9371976-79 1.5 4,3h8 3,8261980-83 [4.8 10,479 9,222

Total 15.6 - i 33,130 29,154

West Coast Demerara 1968 0.3 285 251

District(SD#l-90) 1969-71 7.2 4,701 4,137

1972-75 4.3 6,430 5,658

Total 11.8 1 lO,1[46

Project Area 1968-83 27.4 44,546 39,200

Includes 3.7 miles of supplementary works which are double counted.

2/ Includes 1.2 miles of supplementary works which are double counted.

August 2, 1968

GUYANA

SEA DEFENSE PROJECT

Rates of Return of Project Under Different Assumptions

Agriculture only Agriculture Plus ResidentialAnnual residential value as percentage of capital value

Rate of 5% 7% 10%Accmaulation Including Excluding Including Excluding Including Kwcluding Including Excluding

of Agri. Agri. Agri. Agri. Agri. Agri. Agri. Agri.Area Benefits Labor Labor Labor Labor Labor Labor Labor Labor

',Thole Project High 49.8 19.2 - - > 100 100 - -Expected 19.0 9.6 34.5 24.9 41.5 31.9 53.8 41.4Low 16.9 9.1 - - 29.4 24.5 - -

East Coast High - - -

Demn-rara only Expected 16A 7.2 _ 3.2 =Low _ - _ _ _ _

West Coast High - - - - -Demerara only Expected 26.9 13.9 - 64.7 - °

LoW - - _ _ - _ _ _

West CoastDemerara Subsidiary High - _ _ -_Area mest of Expected 19.7 - - - 28.5 -- -Boerasine River Low - -_ _

1/ See text and Figure A.2/ Wages of unakilled paid labor included in net agricultural income as a benefit.1/ Agricultural benefits excluding the value of all wages.

August 2, 1968

GUYANA- SEA DEFENSE PROJECT

a ~~POSTULATED CURVES FOR RATE OF LOSS OF PRODUJCTIONl

'1 ~~~~~~100 0

0'~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

80~~~~~~~~~~~~~~~~~~~~~~~~

8o8

7o Constanratee oflooss

40 I"

60 6~~~~~~~~~~~~~~0 0

a)0

4-)

20 C-)~ ~ ~ ~~Lwrt o os2

54 02~~~~~~~~~~~~~~~~~~y0)

-4-''H~~~~~Tar

64.0~- _ _ __ _ _ _ _64 0 1 1 1 ! I I I1 1 1 1 ! I I I I I I

GUYANA: SEA DEFENSE PROJECT 62.5 CREST OF ROPOSED SEA WALLS62.0 - TIDE CURVES

(ELEVATIONS ABOVE GEORGETOWN DATUM)

60.0 60.01

rCREST OF EXISTING SEA WALLS

58.0 -58.0

/ '~6.2' HIGHEST RECORDED TIDE56.0 -

54.0 -

MEAN SPRING TIDE

52.0-

.,K.M EAIILNEAP TIDE.~50 AVERAGE LEVEL OF LAND NEAR500-50.0 GEORGE TOWN

48.0

46.0 ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~46.3 BASE OF TYPICAL WALL

MEAN SEA LEVEL 50.5

MEAN HIGH WATER SPRING TIDE 54.6MEAN LOW WATER SPRING TIDE 46.2

44.0 - tMEAN HIGH WATER NEAP TIDE 52.4. tit~~~EAN LOW WATER NEAP TIDE 48. 5

42.0 I 1 1 1 1 1 1 1 1 1 0 1 2 3 4 5 6 7 8 9 10 1! 12 13 14 15 16 17 i8 19 20) 21 22 23 24 25

HOURStnouR6 ~ ~ ~ ~ ~

I ~~~ -__________________________________________~~~~~~~~~~~~~~~~~~~tS D- St

GUYANA: SEA DEFENSE PROJECTORGANIZATION OF MINISTRY OF WORKS AND HYDRAULICS

MINISTER OF WORKS AND HYDRAULICS

LPERMANENT SECRETARY |-u.eSEA DEFENSE BOARD C

0'~~~~~~~~

PRINCIPAL ASSISTANT SECRETARY PRINCIPAL ASSISTANT SECRETARY PRINCIPAL ASSISTANT SECRETARY O, CHIEF WORKS ANDDEVELOPMENT FINANCE WORKS HYDRAULICS OFFICER r

w~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

PLANNING SUPPLIES, ACCOUNTS AND AUDIT AP.DrINISTRATION AND PERSONNEL

PURE WATER BUILDINGS ROhLS :,;CHANIC4L AN' CHIEF ENGINEER DISTRICTSUPPLY DIVISION DIVISION IVISIUI: ELECTRIC.L SIVISIOI HYDRAULICS DIVISION ENGINEERS

HYDROMETEOROLOGY WATER ADMINISTRATICrl I

OFFICER

I~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

/ I ENGINEER I I RESEARCH ! | ENGINEER I1

/ |STRUCTURAL DESIGN | I AND SURVEYS I I SEA DEFENSES Ii

DRAINAGE AND IRRIGATION SEA DEFENSE COASTAL SURVEYS MAJOR PROJECTS MINOR PROJECTSSTRUCTURES STRUCTURES

|MAINTENANCE |

NOTE:Officials responsible for sea defenses shown in boxes.

July 1968 (R)IBRD-3978 4

GUYANA: SEA DEFENSE PROJECTCONSTRUCTION SCHEDULE

MONTHS 0 1 2 24 36 48 60

SEA DEFENSES

CHOICE OF CONSULTANTSPREPARATION OF TENDER DOCUMENTSPREQUALIFICATION OF TENDERERS-BANK'S APPROVAL TENDERING-AWARD AND BANK'S APPROVAL MOBILIZATIONCONSTRUCTIONDEMOBILIZATION

HYDROGRAPHIC STUDY EQUIPMENT

CHOICE OF SUPPLIER-BANK'S APPROVALSUPPLY

LABORATORY TESTS FOR SEA WALLS

CHOICE OF LABORATORYBANK'S APPROVAL-LABORATORY

BREAKWATER DESIGN

PREPARATION-BANK'S APPROVALSTUDIES AND ENGINEERINGTENDERING

BREAKWATER CONSTRUCTION

APPRAISAL AND NEGOTIA TION-TENDERINGBANK'S APPROVALCONSTRUCTION

(R)IBRD-3986

M(A? I

GUYANA

ft~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~~~~~mp

, 4 ,4 > Xs41 . a ~~~~~~~~~~~~~Rpids or I

t / / >X _~~~~~~~~~~~~~~~~~~A r Roginoy

d:~~~~~~~~~~~~~~~~~~~~-

t~~~~~~~~~~~~~~~~~~~~~~~~~~Mre X<igr r tW-

K.-. -. F, ,

Mkly v~~~~~~~~~

;-'''1~~~~~~'-0 '~l

JUNE 296b [ORD 23iO7

GUYANA

ESSEQUIBO CORENTYNE COAST

SOILS, MINERALS AND POPULATION MAP2

LE EL N LI

IlllillJ Peat and silt swamps

l ~* Riverain soils

.~~~ \~~~~ 11111>'~~~~Iill sanJs* *- 71 P | t~~~~~~~~~~~oas'tal clavs

* Cold

* Bauxite

|| Stone quarries

(1000 Persons) PopulationDistribution 1960

,,\ .i 1'/ ) 5 (I 1') 20 31) 40 5s

X~~~~~~~~~~~~~~X

*- ',t. ',, .- _---. M-:ES

*:: *::.-- '9. -~In --- rb *- op. 7 '-- - - ,

>\ \ * ~~~~~~~~~- - ,ih- ;Wa 1 'var ni

JUNE 1968 ~~~~~~~~~~~~~~IBRD 2310

JUNE 1968~~~~~~~~~~~~~X

GUYANA

SEA DEFENSE PROGRAM EAST DEMERARA COAST M4AP 3

A - T= L A N T ' 0 C

, A

;

/~~ ~ ~~~ I G S~ U N o E ET TEt i | ,, 0'

/~~~ .J 1 ! |i s / ! | -A~t S :1 Ri-

D0 12

1 - 2 3 4 5

[' -, ~~~~~~I Residental areR High wat________level__ | E R OSIGNAND BESATHES ; , c KriLOMeTERndnS

______________________________ILA BONNE INTENTION- ~~~~~~~ESTATES

SUGAR ENtIRE ESTATESNAN STATE

SEA DEFENSES jI AN RS

Ereidential area -~'~N.-~ High eater l1ve EROSION AND BREACHES 4Dang n

Sugar Factory Earth enig ekeret EXISTING pre--en -ycD erosion eragaslan area >

t| Radio S eatise T',VO Sea nail prviu -DlCCTI EtOtaohe

Road O Drainage e.e.. e T Local erosion[(1968) 8

Pailway _ IBRD p,,,,,t sea w 1 A,:.:reas Daterhreact c)

0 DeaitaSn puep c Other proeets Nra w all 1 96B-7 1 P ROGRAM f Areas affeted Ay see water after Areach eN

Earth -ebankmrnl SD Sea d efense deanisd- rat-vesett on I t

1972-79 PROGRAM

-arth e-batk-ent

JUNE 19OA

IBNA 2309

GUYANA

SEA DEFENSE PROGRAM WEST COAST DEMERARA MP 4

D~~~~~~~~~~~~~~~~T MILFS~~~~RA9N IIILFS~~~~~~~~~~~~~~~~~~~~~~~~~01 2 3

s Q U B 0 ~~~~~~ ~~~~~~~~~~~~~~~~~4 1 I 2 3 4 5

5 8 I r2 KILOMETERS

~lS I

4~~~~~~~~~~~~~4

C~~~~~~~~~~~~~~~~C

V:~~~~~~~~~~~~~~~~~~~~~~~~~~~'

PARIKA VERGENOEGEN-BONASIKE// I ,e

< ~~~~~Drainage and irritation A-e _ )| i_<G

h TME UaT 6 U G T * T r A TW

SEA DEFENSES

E:Ii; Residential area ,HHighgh1t6

water level

Mruarfctrlea wall EXISTINGI

Road 0 Draiaaga anlee

0 [ INRII project sea wall

R Other prajejts sea wall 1968-71 PROGRAM

. . .. . Earth enbank-ent SD In defan-e wdisatat,vrsrcticne /

Sea wal i1 / Earth .b..k ... t f1972-79 PROGRAM I

JUNE 1968IlRll 2308