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LESSONS:

Suzhou Creek Rehabilitation Project

| country: China, People’s Republic of

Strong capacity to implement resettlement activities was essential for smooth implementation of the large-scale urban resettlement activities under the project. Clearly defined functions and responsibilities of the Project Preparation Department established within the executing agency and resettlement companies ensured close coordination between resettlement activities and construction activities to prevent delays and maintain orderly relocation.

The executing agency actively utilized the ability of the private sector in project implementation and management. Tendering companies were engaged to manage tendering works, resettlement activities were coordinated and managed by resettlement companies, and operations of some of the facilities improved and/or constructed under the project were contracted out. This approach was effective for such a large, complicated, and multifaceted project.

The government’s strong political commitment and management capability was key to the success of the project. As the project focused on comprehensive environmental rehabilitation and comprised many components, strong leadership to bring in all related agencies of the government (Shanghai Municipal Government) was required throughout the planning and implementation of the project. To exercise its leadership, the government carefully designed and established project implementation arrangements to allow it to coordinate related agencies effectively, provide guidance at the highest level when necessary, keep to schedules, and adhere to procedures.

Wastewater projects in the future should exercise caution in estimating revenues derived from water supply sales and forecasts. Where possible, price elasticity of demand should be explicitly considered or only growth from increased coverage should be incorporated. In this project, estimates of wastewater revenues were overstated because the volume of water sold was overestimated. This is a recurring problem in similar projects in the PRC particularly where the water and/or wastewater tariff has increased substantially. On the other hand, this is a successful case of water conservation through the introduction of a market mechanism.

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