r - part - usaid

Conpsehensive ccst estixates far szcundwater development in
Somalia have been produced during the pro-jec:, This section of
tbe report describes the zetkodology used: explains the
satianzle behind it, and presents the ~afor findings, Only the
cask of well constr~ction and xaln2ezance has been determined.
Using this as a aodei, the cost of ~tker operations of WDA, such
zs the buildi~~g of reservoirs and tke canstruction of urban
water supplies, should 5e deterxized by the Planning Unit aver
the coning years.
13 project appraiszl teminoiogy, thre2 kinds of analysis
are possible, finartcial, acononie, and socioecenamic.
Financial, or "co~~~~ercial~~, appraisal uses eszinates of the
actual local costs which vouid be rel2vant in assessing the
comaercial viability of an cperation, - aconomkc appraisal
assesses the viability af an cperztian iron the position of the
c~u~try as a whole; as szck, taxes and tar.iFfs are excluded, and
prices used are c.i.f. or f.0.b. a'wcrld pricesqv or "shadow
pricest'. Socio-econonic appraisal is based upon economic
appraisal, but mzkes additional allowance for the wsacialw goals
of the government; in t3is type zf analysis savings might be
valued diffezen~ly fran consumption, and soale weighting might be
given for be~eficia3 distribution of incone or profits. The
analysis which follows is closest ts 2n ecanomic analysis in
that prices trsed are worlc! prices exclrrsive cf taxes. The costs
xsed zeLate to i? don~r-~*.- Addidea grour,d.dater program in Somalia.
This explazatkoz is szxexha slxpLlstic, and the issue is
disc~ssed xore fully in Sectim 2.3, %her3 ~assib2.e adjustments,
azd the difficu2t question cf evaluating aenefits, are
zonsidered.
In this secrisn cf tha report, t h ~ cost a2 well
ccnstructkor: is dealt with flrst, beqinnirg with a brief
descriptier, of =ke overaLl z~etkodology, and then dealing with
each pkzse of the work in-wived. Cperation and maintenance
costs, azd the anorzisa~icz cf tstzi ccsts is discussed next.
*I Finally, + same issues on shadow prices for possible use in a true
ecanoxic or socioecono~ic appraisal are discussed, includi~g a
discusslc~ cf the sigzificance cf user charges.
-*o ecocoz:ic amlyses of ehe Co~prehensive Grcundwater
,;eviously been completed by LBII
ca~sultznts dzri~a h e project. -. iz,e ;l first af these was
x.ndertaken by Earl< 3. Tape, (Pepe, lsS2) a ~ d the second by
Carter 3randcn, -
(Srandon, 1984;. rar the sake zf brevity, these
'*.I
:--epcrzs WL;L be refe~ red tc 25 the Pape and Brandon reports
rescect i-zel y . These rsports c=r.tuibzted substantially to the
snderstanding cf Th.2 cssts and econaz.ics 39th of the project,
a?d of the Cevelc~xenc of gxomdvater resources in Somalia; A
-T.
Developnect ~rojecr have --