Improving Transport Project Appraisals
In the Islamic Countries
114
Based on Jordan’s practice to carry out project appraisal, there is capacity in the sector to do
this, both in the public and private sector. However, the capacity is not widespread and often
rest with a relatively limited number of people or companies, making the system somewhat
vulnerable. Capacity building in appraisal is not carried out on a structural basis. No guidelines
are available on how to do project appraisal, apart from the guidelines prepared by the PPP Unit.
When carrying out CBA, a broad range of costs and benefits are included, reflecting the
international standard. Typical benefits would include travel tine savings and congestion
reduction, environmental, safety and social impacts, reliability and development of real estate
prices. Most impacts are quantified and monetised; some are applied in a qualitative manner.
Input parameters are sometimes derived from the LTNTS, for example value of time (VoT),
which is established for 2018 and adjusted for the future based on projected GDP per capita
development. Also, project duration (e.g. 30 years for BRT) and discount rates (8%) seem to be
in a common range.
Demand analysis is a mandatory requirement of the appraisal process and often integrated in
the Terms of Reference of a consultant providing support services in a feasibility study. As part
of the transport strategy development, a national transport model was developed, based on
VISUM, providing a strong basis for future demand analysis at project level. At urban level,
transport models are used.
Transport project appraisal is used for the justification of investment decisions of individual
projects. As mentioned earlier, the transport strategy includes an action plan, consisting of
prioritised projects and policies.
Monitoring is taking place on a structural basis. Ex-post evaluation may be done. The MoT has a
unit on follow up and evaluation.
Policy recommendations
Based on the above-mentioned conclusions, a number of policy recommendations can be
defined, as described below.
Take full benefit of the transport strategy and its pipeline of projects
 Jordan has developed a strong transport sector strategy (LTNTS), based on a strong
methodological foundation, consisting of the application of a nation-wide transport model
and a MCA, with specific economic and financial inputs from CBA. The developed scenario,
with projects and policies, can be used to appraise projects at an individual level
 A lot of the parameters used in the LTNTS, such as value of time, discount rates, project
durations, can be applied for current and upcoming project appraisals. It is recommended to
standardise these input parameters (see recommendation on transport project appraisal
manual).
 A spin-off effect of the LTNTS is that is can be used as an inventory or investment guide for
potential investors in the sector or development partners and IFIs. The underlying economic
and financial analyses provide a potential starting point to ignite interest from partners.