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Mongolia is a vast, sparsely populated country located between the People’s Republic of China (PRC) to the south and the Russian Federation to the north.  Its western region suffers from a slow pace of development because of remoteness from the country’s political and economic centers and inadequate transport network. At appraisal, roads to and within the region were mostly unpaved, imposing high travel costs on residents and visitors. As a result, the region lacked access to jobs, markets, and social services, and was significantlypoorer than other parts of Mongolia.

The government placed a high priority on the development of paved roads in the region whose poverty incidence in 2008 was 48%, compared with the national average of 34%.  The Western Regional Road Corridor Development Project—Phase I, approved by the Asian Development Bank (ADB) in February 2008 for a grant of $37.6 million, supports the attainment of this development priority.  The project was designed to improve the efficiency and safety of the road corridor in western Mongolia, which runs north–south from Mongolia’s border with the Russian Federation at Ulaanbaishint to its border with the PRC at Yarant and has a total length of about 743 kilometers (km). The project road corridor is part of Asian Highway 4 and designated as Central Asia Regional Economic Cooperation (CAREC) corridor 4a. In the long term, the corridor will serve as a transit route for traffic from the Kyrgyz Republic, Tajikistan, and Uzbekistan to the Siberia region of the Russian Federation, promoting regional cooperation and integration.

The project’s envisaged impact was the promotion of regional transport and increased economic development and regional trade. Its expected outcome was an efficient and safe regional transport route developed in the western region of Mongolia to link Mongolia with Xinjiang Uygur Autonomous Region in the PRC and Siberia in the Russian Federation. Its planned outputs were (i) improved 431.2 km Yarant–Hovd city road, (ii) establishment of road maintenance centers, (iii) procurement of maintenance equipment, (iv) improved road safety, (v) community development, (vi) HIV/AIDS awareness, and (vii) strengthening of institutional capacity of the Ministry of Roads, Transport and Tourism.

At completion, the project delivered only 110.8 km of Category III road, a two-lane, undivided road with design speeds of 100 km per hour, 80 km per hour, or 60 km per hour depending on the terrain.  The significant shortfall was partly because of cost overruns due to price escalations.  The government of Mongolia and the Export–Import Bank of China funded other sections, while ADB’s ensuing multitranche financing facility (MFF) program included another section. 

Two road maintenance centers were established at facilities that had been used as construction campsites. Maintenance equipment worth $447,250 were provided to the state-owned Khovd Road Maintenance Company.  Road maintenance and road safety activities included the enforcement of axle load limits through the establishment of a weigh station near one soum, enhancement of road alignment, road safety audits by the executing agency (EA) at various stages, and the installation of guardrails, road signs and markings, kilometer posts, and other safety features. Community development activities supported by the project, including the construction of deep wells and greenhouses and vegetable farming and other agricultural training courses benefited three suoms and leveraged government funds for related activities.  About 1,500 construction workers, local people, health organizations, police, and administration staff of cities and aimags (administrative subdivision) were reached by the project HIV/AIDs awareness activities.

Because of the project, average travel speed increased from 40 km per hour to 80 km per hour, between 2010 and 2015. During the same period, travel time from Yarant to Ulaanbaishint decreased by 8 hours; the average border processing times for goods and passengers at Yarant and Ulaanbaishint shortened by 5 hours; and traffic volume at the Yarant and Ulaanbaishint border increased by 10%–15% annually. The project improved the transport network in the region, allowing residents easier, cheaper, and faster access to social, health, and other services.

At appraisal, the Department of Roads under the Ministry of Roads, Transport and Tourism was designated as EA.  Restructured and renamed several times, at the latest as the Ministry of Road and Transport Development, the EA established a project implementation unit to implement activities on a day-to-day basis.

Project Information
Project Name: 
Western Regional Road Corridor Development Project, Phase 1
Report Date: 
November, 2019
Main Sector: 
Project Number: 
Report Type: 
Project grant
Goal 9: Industry, Innovation, and Infrastructure
Goal 8: Decent Work and Economic Growth
Loan Number: 
Source of Funding: 
Date Approved: 
26 February 2008
Report Rating: 

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