Damascus water supply I

Evaluation covers the period 6/75-8/80 and is based on a review of project documents. The project is seriously behind schedule. Architectural and engineering contract negotiations, targeted for 11/75, were not approved by Syria until 12/76; the invitation to submit construction bids, issued 12/78, was 21 months late; and the original project completion date of 2/28/80 has now passed and construction has not yet commenced. These delays have resulted from several unplanned events. The high construction bids tendered by three U.S. firms spurred rumors in Damascus that the firms had colluded to assure that the contract would be awarded to Harbert-Howard (HH). Subsequent offers by HH to reduce its bid were taken as further evidence of an inflated original bid. The Government of Syria"s (SARG) proposal to contract a Syrian firm was accepted by A.I.D. with the proviso that U.S. technicians provide management assistance. However, A.I.D. later decided it could not finance such assistance for fear one of the originally rejected U.S. firms might give the low bid which the SARG would in turn reject. The contracting fiasco and resulting A.I.D./SARG impasse and pressure by HH on the U.S. Congress threatened the future of A.I.D. activities in Syria. Finally, a modified fixed amount reimbursement plan was agreed upon in which the SARG would procure materials with its own foreign exchange and be reimbursed only as the project was completed and satisfied A.I.D."s standards. As yet, however, the contracted Syrian firm has received no foreign exchange, severely hampering project progress. To assure project completion, it is recommended that the necessary foreign exchange be allocated to finance procurement of pipe, fittings, and equipment; bid invitations be issued; and procurement awards made by the Syrian contractor be approved. Three key lessons learned from this first USAID/S project are that implementation schedules must be realistic; standard contracting practices must be flexibly applied in non-standard conditions; and projects should be modified to lessen dependence on U.S. construction firms.