balance火影忍者644

RESTRICTEDReportNo.
TO-545aThisreportwaspreparedforusewithintheBankanditsaffiliatedorganizations.
Theydonotacceptresponsibilityforitsaccuracyorcompleteness.
Thereportmaynotbepublishednormayitbequotedasrepresentingtheirviews.
INTERNATIONALBANKFORRECONSTRUCTIONANDDEVELOPMENTINTERNATIONALDEVELOPMENTASSOCIATIONSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTJAPANJuly18,1966ProjectsDepartmentPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedPublicDisclosureAuthorizedCURRENCYEQUIVALENTSUS$1=3601YenUS0.
28FiscalYearApril1-March31UnitsMetricJAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTTOKYO-SHIZUOKATABLEOFCONTEqTSPageNo.
SUMMARYi-ii1.
INTRODUCTION12.
BACKGROUND1A.
TransportationinJapan1B.
TheBorrower2C.
ExistingBank-financedExpressways33.
THEPROJECT4A.
Description,AdministrationandExecution4B.
ProgressStatus4C.
CostEstimateandProbableLoanDisbursement54.
ECONOMICANDFINANCIALASPECTS7A.
EconomicJustification7B.
FinancialReturnoftheProject8C.
FinancialSituationoftheBorrower95.
CONCLUSIONSANDRECOMMENDATIONS12ThisreportwaswrittenbyMessrs.
Hardy,Irion,AdlerandKnotheonthebasisofthepreviousappraisalreport,periodicprojectsupervisionvisitstoJapansince1964andinformationreceivedfromNihonDoroKodanduringMarch-April,1966.
TABIES1.
BankFinancingofTokyo-KobeExpressway2.
EstimateofProjectCost3.
EstimatedAverageDailyTraffic,Tokyo-ShizuokaExpressway,1969-19844.
ComparisonofOperatingCostsontheExistingHighwayandtheTbkyo-ShizuokaExpressway,19695.
FinancialForecastoftheTokyo-ShizuokaExpressway6.
ScheduleofProposedTollCharges7.
SummaryStatementofRevenuesandExpenditures8.
SummaryBalanceSheets9.
IncomeAccountofTollFacilitiesLO.
ForecastofRevenuesandExpendituresLl.
Pro-FormaBalanceSheetsMAPS1.
Japan:NationalHighwaySystem2.
Tokyo-ShizuokaExpresswayJAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTTOKYO-SHIZUOKASUIARYi.
TheGovernmentofJapanandtheNihonDoroKodanhaverequestedadditionalfinancialassistancefromtheBankinconstructingtheTokyo-Kobeexpressway.
TomeettheGovernment'srequest,itisproposedtoincreasebyUS$100milliontheBank'sparticipationintheThirdExpresswayProject(Loan357-JA)forwhichaloanofUS$75millionwasmadein1963.
Conse-quently,thisreportisasupplementaryappraisaloftheThirdExpresswayProject,whichisa162kmlongtollexpresswaybetweenTokyoandShizuokaformingapartoftheTokyo-Kobeexpressway(seeMaps1&2).
ii.
TheBorrowerandexecutingagencyfortheprojectistheNihonDoroKodan,asemi-autonomousinstitutionwithintheMinistryofConstruction;itisalreadywellknovmtotheBankandhasprovedtobeanefficientandcompetentorganization.
AlthoughKodan'sfinancialstructureincludesahighproportionofdebt,itsearningcapacityishighandithasthefTullfinancialsupportoftheGovernment.
iii.
TheBankhasmadefiveloanstotheKodanoverthepastsixyearstotallingUS$280milliontofinancetheconstructionofthe536kmexpress-waybetweenTokyoandKobe.
DesignstandardsandcontractualproceduresoftheThirdProjectremainvirtuallyunaltered.
Theproject,althoughnowaboutsixmonthsbehindschedule,isexpectedtobecompletedasscheduledbyApril1969,atwhichtimethewholeexpressway,536kmlong,fromTokyotoKobewillbeopentotraffic.
iv.
ThetotalestimatedcostoftheTokyo-Shizuokaproject,includingconstruction,landacquisition,engineeringandinterestduringconstruction,hasonlyincreasedbyabout2I%fromtheoriginalestimateofUS$628millionequivalent.
TheproposedsupplementaryloanwoubdraisetheBank'spar-ticipationintheconstructionandlandcostsofthissectionfrom15%to33%.
TheoverallBank'sparticipationintheTokyo-Kobeexpresswaywouldrisefrom22%to29%ofitstotalcost,excludinginterestduringconstruction.
v.
ConstructionworkstothevalueofaboutUS$170millionhaveyettobeawarded.
TheBorrowerwillcontinuetoprovideopportunityforinter-nationalcompetitivebiddingonmajorpartsoftheworks.
Interestonthepartofforeigncontractorsintheexpresswayasawholehasrecentlyin-creasedand,inSeptember1965,thefirstnon-Japanesecontractorwassuc-cessfulinobtainingacontract.
vi.
Originalforecastsoftraffic,economicsavingsandtollrevenueshavebeenreviewedinthelightofexperienceobtainedsofarona183km-ii-portionoftheTokyo-Kobeexpressway(financedunderthefirstandsecondloans)alreadyopenedtotraffic.
Trafficcompositionhaschangedfromtheoriginalforecasts;therearemorelightthanheavyvehicles,andthetotalvehicle-kmsareslightlyless.
vii.
Theneteffectofthesechanges,andoftheconstructioncostincrease,isthattheeconomicreturnontheinvestmentisnowestimatedat15percent,comparedto18percentpreviously,butstillprovidesasoundeconomicjustification.
viii.
Theprojectisstillfinanciallyviableandwouldpaybackthetotalinvestmentcosts,includinginterest,inaperiodof22to24years;thisisstilllessthantheusefuleconomiclifeoftheproject.
ix.
TheThirdExpresswayProjectprovidesasuitablebasisforasupplementaryBankloanofUS$100millionequivalent.
Atermof15yearsincludinga3yearperiodofgraceisrecommended.
JAPANSUPPLEMDENTARYAPPRAISALOFTHETHIRDEXPRESSWJAYPROJECTTOKYO-SHIZUOKA1.
INTRODUCTION1.
1TheGovernmentofJapanandtheNihonDoroKodan(JapanHighwayPublicCorporation)haverequestedadditionalassistancefromtheBankinfinancingtheconstructionoftheTokyo-Kobeexpressway.
Forthispurpose,itisproposedtoincreasetheBank'sparticipationintheThirdExpress-wayProject(Loan357-JA,seeReportNo.
TO-384adatedSeptember1963)fromUS$75milliontoUS$175millionthroughasupplementaryloanofUS$100million.
Thisreport,writtenbyMessrs.
Hardy,Irion,AdlerandKnothe,isareappraisaloftheThirdProjectbasedupontheoriginalappraisalreport,informationobtainedduringperiodicsupervisionvisitsfrom1964andmaterialreceivedfromJapaninMiIarch-April1966.
1.
2TheThirdExpresswayProject(seeHaps1and2)isa162kmlongsectionbetweenTokyo-Shizuokaofthe536kmlongTokyo-Nagoya-Kobeexpress-wayforwhichtheBankhasalreadymadefiveloans(Nos.
2h8,302,357,374and412-JA)overthepastsixyearstotallingUS$280million.
AsummaryofthepreviousloansisgiveninTable1,fromwhichitwillbeseenthat,withtheproposedsupplementaryloanofUS$100million,theBank'spartic-ipationinthetotalexpresswaycostofalmostUS$1.
3billion,excludinginterestduringconstruction,wouldrisefrom22%to29p,andintheTokyo-Shizuokasectionfrom15%toabout33%.
1.
3TheBankalsomadeoneloanofUS$80million(Loan281-JA)in1961whichhelpedfinancetheconstructionofthenewTokaidoExpressRail-wayconnectingTokyo,NagoyaandOsaka.
Inaddition,theBankmadetwoloansofUS$25millioneach,Loan398-JAin1964andLoan423-JAin1965tohelpfinancetheconstructionofurganexpresswaysinTokyoandKoberespectively.
2.
BACKGROUNDA.
TransportationinJapan2.
1AsexplainedingreaterdetailinthepreviousappraisalreportsonthedifferentsectionsoftheTokyo-Kobeexpressway,Japantsdomestictransportationsystemconsistsmainlyofrailways,coastalshippingandhighways.
Airtransportisrelativelylimitedbecauseoftheshortdis-tancesbetweenmajorindustrialareas.
2.
2ThetotalroadnetworkinJapanexceeds150,000kmsinlength,ofwhichlessthan20%ispaved.
Designstandardsaregenerallylowandtrafficnormallyoperatesundercongestedconditions,thusraisingoper-atingcostsandaccidentrates.
Thenumberofmotorvehicleshasincreased-2-regularlyatarateofabout16%overthelast10years.
Itnowreachesalmost8million,including3.
5millionoflighttwoandthree-wheeledvehicles;excludingthelightvehicles,thereareabout25inhabitantspervehicleinJapancomparedtoabout15inItalyand5inFrance.
2.
3.
TheNationalEconomicPlanningBoardplanstransportationinvest-mentinJapan,theMinistryofTransportationcoordinatesthevariousmodesoftransportandhasauthorityoverratesandfaresandtransportoperation,whilehighwayconstructionandmanagementisprimarilytheresponsibilityoftheMinistryofConstruction.
Tollroadsarefinanced,builtandoper-atedbysemi-autonomousagencieswhichareresponsibletotheMinistryofConstruction.
Thereareatpresentthreesuchagencies:(i)theJapanHighwayPublicCorporation(theNihonDoroKodan),dealingmainlywithtollroadsinruralareas;(ii)theTokyoExpresswayPublicCorporation,dealingwithurbanexpresswaysintheTokyo-Yokohamametropolitanarea;and(iii)theHanshinExpresswayPublicCorporation,coveringurbanexpresswaysinOsakaandKobecities.
Theprefectures(provinces)andotherlocalpublicbodieshavetheirownhighwayorganizationsandindependentsourcesofrevenues,butmanyroadsofnationalimportancewithintheirareasofjuris-dictionqualifyforgovernmentgrants.
2.
4.
TheGoverrment,consciousoftheincreasedneedforimprovedtransportationfacilitiesingeneralandforhighwaysinparticular,hasapprovedaFiveYearRoadImprovementProgramunderwhichanamountofUS$11.
4billionequivalentistobespentfortheconstruction,improvementandmaintenanceofroadsduringtheperiodfromApril1964toMarch1969.
Aboutahalfofthisprogramwillbefinancedfromthenationalbudgetandtheremainderbyinternationalordomesticborrowingandbylocalauthorities.
2.
5.
DetailsoftheFiveYearRoadProgramaregivenintheappraisalreportoftheFifthExpresswayproject(ReportNo.
TO-474a).
Thegeneralobjectivesoftheprogramaretoincreasetheexpresswaynetwork(includingbothcityandruralexpressways)from87kmin1964to790kmduringthatperiod.
TheBank-financedexpresswaysprojectsareintegralpartsoftheprogram.
B.
TheBorrower2.
6.
TheBorrowierandexecutingagencyistheNihonDoroKodanwhoseorganizationandpolicieshavebeendescribedindetailinthepreviousappraisalreports.
ItwillberecalledthatitisanagencyoftheMinistryofConstructionestablishedin1956totakeoverthe1M1inistrytsresponsi-bilityfortolltransportfacilities,includingroads,bridges,tunnels,ferriesandparkinglots.
AlthoughtheKodanisautonomousinform,itisinfactsubjecttoalargedegreeofministerialcontrol.
2.
7TheKodanfinancesitsconstructionexpendituresbyborrowingandbyinterest-freegovernmentinvestment,inproportionswhicharecalculatedtomaketheaveragecostofallitsfundsabout6%.
ThetollswhichKodanchargesfortheuseofitsfacilitiesaredesignedtocoveritsoperationandmaintenanceexpenses,topayinterestonitsdebt,andtorepaythe-3-capitalcostswithintheperiodofusefullifeofthefacilities.
Forexpressways,theusefullifeisreckonedatabout30years.
Sincerevenuesfromnewfacilitiesbuildupslowly,andtotalreceiptsfromthesefacili-tiesintheearlyyearsarenotadequatetocoverallchargeswithintherelativelyshortaveragetermofKodan'sdebt(aboutseventotenyears),Kodanisobligedtore-financealargeproportionofitsmaturingdebt.
C.
ExistingBank-FinancedExpressways2.
8.
TwosectionsoftheTokyo-Kobeexpresswaytotalling183kms,namelythoserelatedtothefirstandsecondexpresswayprojects(Ref.
1and2ofTable1)havealreadybeencompletedandwereopenedtotrafficin1963/64.
Acomparisonofactualtrafficvolumesandtollrevenueswithfore-castsisthereforepossibleandisincludedlaterintheSectionon"EconomicJustification".
2.
9.
ThefinalconstructioncostofthesetwosectionswasforecastbytheKodanwithreasonableaccuracy.
Thefirstproject,72kmlong,costabout10%morethantheoriginalestimatepluscontingencyallowance.
Thesecondproject,104knlong,costabout4%lessthantheoriginalestimatepluscontingency.
2.
10.
Completionofthetwoprojectstookslightlylongerthanplanned,duemainlytounforeseendifficultiesintheacquisitionofright-of-wayandtocertaintechnicaldifficultiesintunnelconstructionwhicharenotlikelytoariseinthesubsequentprojects.
Partsoftheexpresswaywereopenedtotrafficonthescheduledcompletiondate,butthetotallengthcouldnotbeopeneduntilsomesixmonthslaterthanscheduled.
ThedelaywasnotunreasonableconsideringthatitwasanentirelynewtypeofprojectforJapan.
2.
11.
Thequalityofworkmanshipinthecompletedexpresswaysisgood;operation,managementandmaintenancebytheKodanissound,andthepolic-ingarrangementsaresatisfactory.
Theestimatedeconomicandfinancialreturns,althoughslightlyreviseddownwardsinthelightoftheexperiencegainedfromthefirstyearsofoperation,stillremainsatisfactory.
2.
12.
Thethreeprojectsstillunderconstructionareprogressingsat-isfactorily.
Thestatusofthethirdprojectisdescribedindetailhere-after;thefourthproject(Loan374-JA)andthefifthproject(Loan412-JA)areabout22%and5%completerespectively.
OverallcostestimatesarestillaboutthesameasoriginalestimatesandthetargetcompletiondatesofApril1969areexpectedtobemet,withcertainprioritysectionsbeingopenedbytheendof1968.
3.
THEPROJECTA.
Descri2tionDesignStandardsandExecution3.
1.
Theprojecthasnotbeenmodifiedfromthatdescribedinthefor-merappraisalreport,withtheexceptionofminoralterationsindesignstandardsasexplainedbelow.
Briefly,theprojectconsistsofasectionofexpresswayextendingapproximately161kmfromthewesternsuburbsofTokyotoShizuoka(seeMaps1and2)constitutingpartofthefutureTokyo-Nagoya-Kobeexpressway.
CloselyrelatedtotheprojectaretheconstructionandimprovementofaccessroadsforwhichtheMinistryofConstructionandlocalauthoritiesareresponsible.
3.
2.
The35kmsectionbetweenTokyoandAtsugiwillbeconstructedto6-lanestandardandtheremainderto4-lane.
Designspeedrangesfrom120kmperhourinlevelterrainto80kmperhourinmountainousareas.
Theoriginalprojecthasonlybeenmodifiedslightlywithregardto(i)shoulderwidthwhichhasbeenwidenedfrom2.
75to3.
25m,and(ii)pavementthick-nesswhichhasbeenadjustedaccordingtositeconditions.
3.
3.
NihonDoroKodanistheexecutingagencyandwillalsooperatetheprojectaftercompletion.
BiddingdocumentsandprocurementproceduresareinaccordancewiththeBank'srequirementsforinternationalcompetition,andinterestbyforeigncontractorsinparticipationhasrecentlyincreased.
AU.
S.
contractorwasawardedacontractvaluedataboutUS$3millioninSeptember1965forconstructingasectionoftheexpresswaynearShizuoka.
DuringloannegotiationstheformeragreementsbetweentheBankandKodanregardingprocurementwerere-affirmedinconnectionwiththesupplementaryloan.
B.
ProgressStatus3.
4.
Constructionworkwasstartedin1963onaminorscalenearMountFujiwhenalandslideblockedexistingfacilities.
Theprojectworkdidnotenteritsmainphaseuntil1965(insteadofin196h,asoriginallyforecast)duetodifficultyinright-of-wayacquisition.
Completionisnowsomesixmonthsbehindtheoriginal1963schedule.
3.
5.
Theprojectoverallisabout30percentcomplete.
AsofApril1966,abouttwo-thirdsoftheright-of-wayhadbeenacquiredandnegotiationswerewelladvancedforthebalance.
Of135mainconstructionsections,one-half,amountingtoabout50percentoftotalconstructioncost,hasalreadybeenawardedtocontract.
ThebalanceofconstructioncontractsyettobeawardedarevaluedatapproximatelyUS$170millionequivalent,ofwhichaboutUS$120millionofthemajorworkswillbeadvertisedonaninternationalbasis.
Theassociatedaccessroadprogramisprogressingmorerapidlythantheexpresswaysinceproblemsofright-of-waywerelessimportantfortheseroads.
3.
6.
Kodan'srecentlyrevisedworkschedulestillmaintainstheoriginalcompletiondateofMarch1969forthewholeproject.
BecauseoftherelativepriorityofthetwoextremesectionsTokyo-AtsugiandYoshiwara-Shizuoka(seeMap2)constructionworkstartedearlieronthesesectionsthanonthemountainousmiddlesectionAtsugi-Yoshiwara,andtheiropeningtotrafficisscheduledtotakeplaceinSeptember1968.
Thisforecastseemsreasonablesincetherelatedconstructionworkisnowalmostentirelyawardedtocontract.
AsfortheAtsugi-Yoshiwarasection,theshedulecompletiondateofMlarch1969isnotunrealisticbutwilldependlargelyonfavorableweathercondi-tionsduringthewinterof1968/69whenpavingwillbeundertaken.
C.
CostEstimatesandLoanDisbursement3.
7.
Thelatesttotalcostestimatefortheprojectindicatesanoverallincreaseofonly21percentovertheoriginalcostestimate,fromX226toY231billion(seeTable2).
Theestimateofconstructioncosthasremainedessentiallythesamewithslightinternalvariationsmainlyinearthworksandbridges.
Ontheotherhand,theestimateofright-of-wayandcompensationcosthasincreasedby62percentovertheSeptember1963estimate.
Theincreaseisduetoa3percentincreaseinlandareaandof59percentinlandandpropertyprices,thelatterincreaseresultingfromamorerapidrisethanexpectedoflandvaluesgenerallyinJapan,andfromtheexcept-ionaldevelopmentoftheareainfluencedbytheproject.
Thenewcostestimateforright-of-wayisconsideredreliableinasnmchastwo-thirdsofthelandacquisitionhasalreadybeenacquiredandpricestentativelyagreedbytheKodanforthemajorpartofthebalance.
Henceacontingencyallow-anceof5percentonthetotalofthisitem(orabout15percentonthenon-acquiredportion)isdeemedadequate.
3.
8.
Thefinalengineeringf-ortheprojectisnowentirelycompleted,one-halfofthetotalamountofconstructionworkisalreadyawardedtocontractandprojectconstructionisabout20percentcomplete.
Contractstodatehavebeenawardedatpricesgenerallylowerthantheestimatedcost.
ToprovideforthepossibilityofsomechangesinwholesalepricesandwagesinJapanwithinthenextthreeyears,acontingencyallowanceofabout15percentofthebalanceofworktobebid(or7percentofthetotalestimate)hasbeendeemedadequateforconstruction.
Thecostestimatesandcontingenciesallowanceswereconfirmedduringloannegotiations.
3.
9.
Astheoriginalreportpointedout,theconstructioncostsofthethirdprojectarenotunreasonabletakingintoconsiderationthatalmostone-quarteroftheprojectlengthis6-lane,andalsothatduetotheexcept-ionallydifficultterrain,majorbridges,tunnelsandviaductsareneededover30percentofitslength(comparedto15-20percentintheotherexpresswayprojects).
Acomparisonoftheaveragecostsperkmisgivenbelow:AverageCostofJapaneseExpressways(*)(US$millionperkm)FirstSecondFourthFifthThirdProjectItemProjectProjectProjectProject(NewEstimate)--6-ane1.
Constructioncosts1.
41.
31.
61.
92,12.
32.
Right-of-way0.
30.
3o.
5o.
60.
82.
13.
Miscellaneous0.
3O.
40.
50.
50.
70.
7Totalprojectcosts2.
02.
02.
63.
03.
65.
1CompletiondatesSept.
k4Sept.
C1TEApr.
i6'9Apr.
139TApr.
'69(*)4-laneexpresswaysunlessotherwisestated.
-6-3.
10.
TherevisedestimatedannualprojectexpendituresaregiveninTable5(see"ApplicationofFunds")andindicatetheconcentrationofconstructionfrom1966through1968.
TheKodanhasrequested,anditisconsideredreasonable,thatexpendituresontheprojectbeeligiblefordisbursementfromthesupplementaryloanasfromJanuary1,1966.
Thesamedefinitionofeligibleitemsasintheoriginalloanisproposedforthesupplementaryloan,namely:constructioncosts,right-of-wayandcompensationcosts.
Accordingly,theestimatedtotalannualamounts(includingcontingencyallowance)eligibleforBanksupplementalparti-cipationwouldbeasfollows,comparedwiththeeligibleitemsfortheoriginalloan:FiscalYear(EndingMarch31)EligibleItems1963196419651966196719681969Total(9billion)(i)Construction0.
61.
54.
513e428.
545°931.
h125.
8(ii)Right-of-wayandcompen-sation0,21.
711.
020.
016,213.
562.
6A.
OriginalLoan357-JA0.
83.
215.
533.
444.
759.
431.
4188.
4B.
SupplementaryLoan12.
4*h.
759.
431.
4147.
9*PartialfromJanuary1,1966.
3.
11.
TheforeignexchangecomponentofexpresswayconstructioninJapanislow.
Assumingnoforeigncontractorparticipation,theforeigncomponentisabout7percentfromthemoredirectelementssuchasimportedironoreandsteel,crudeoilandpetroleumproducts,whileittotalsabout12percentifalltheindirecteffectsonrelatedindustriesaretakenintoaccount.
3*12*Theoriginalloanagreementprovidesforadisbursementrateof30percenttobeadopteduntilsuchtimeas$30millionofthe$75millionloanisdrawndown,afterwhicharevisedlowerdisbursementratewillbeapplied.
AsofJuly1,1966thebalanceintheoriginalloanaccountwasaboutUS$30million.
AssumingaconstantrateofdisbursementinproportiontoprojectexpendituresontheoutstandingamountsoftheoriginalloanandonthesupplementaryloanofUS$100million,appropriatewithdrawalrateswouldbe8percentfortheoriginalloanand25percentforthesupplementaryloan.
Theestimatedannualscheduleofdisbursementswouldthenbeasfollows:FiscalYears(EndingMarch31)(US$million)ActualForecasts196419651966196719681969TotalThirdLoan1.
98.
924.
520.
812.
56.
475.
oSupplementaryLoan32.
038.
929.
1100.
0-7-4.
ECONOMICANDFINANCIALASPECTSA.
EconomicJustification4.
1.
CompletionoftheTokyo-Kobeexpressway,ofwhichtheTokyo-Shizuokaprojectisanintegralpart,willbeacrucialstepinalleviatingtheseriousshortageoftransportationcapacitywhichnowprevailsintheTokaidoregionofJapan.
Themostimportanteconomicbenefitsoftheproposedprojectwhicharemeasurableinmonetarytermsconsistof:(a)reducedtransportationcosts,whichareestimatedtobringareturnontheinvestmentofabout8percentduringtheexpressway'sassumedusefullifeofabout30years;(b)timesavingstopassengersandfreight,whicharemoredifficulttoexpressinmonetaryterms,butwhichwillprobablybringanadditionalreturnof6percent;and(c)reducedaccidents,whichareestimatedtoprovideabenefitofabout1percentontheinvestment.
Thetotalreturnfromthesebenefitsisthereforeabout15percent.
AreturnofthismagnitudeisreasonableinacountrylikeJapan.
ThecalculationsarebasedonextensivestudiesbytheJapaneseauthorities.
4.
2.
Inre-appraisingtheeconomiciustificationoftheproject,anumberofchangesfromtheoriginalappraisalhavebeenincorporatedonthebasisoftheexperiencegainedsofaronthe183kmportionoftheTokyo-Kobeexpresswayalreadyopenedtotraffic.
Themajorchangestakeintoaccountthefollowingexperience:(a)WhilethenumberofvehiclesusingtheexpresswayhasexceededforecastsbyabouthOpercent,theaveragelengthoftripshasbeensubstantiallyless,sothatthenumberofvehicle-kmshasbeenonlyabout70percentoftheforecast.
(b)Whiletheuseoftheexpresswaybypassengercarsandsmalltruckshasbeenmuchhigherthanexpected,itsutilizationbyordinarytruckshasbeenmuchless.
TheJapaneseofficialsbelievethatsomeofthereasonsforthelatteraretemporary;forexample,Japanhasbeensufferingfromabusinessrecession,mostofthepresenttruckfleetisnotyetsuitableforcontinuoushighspeedoperation,thetruckershavenotyetmadearrange-mentstofullyutilizethetimesavings,andthesectionofexpresswayopenisrelativelyshort.
However,theremayalsobemorepermanentconsiderations,suchasthefactthattruckstendtousetheexistinghighwaysatnightwhencongestionisnormallyless.
Thebenefitoftheexpresswaytotruckersthereforemayhavebeenover-estimatedundertheabovecircumstances,andthepresentleveloftollchargesmaybehavingadiscouragingeffectontruckdiversion.
4.
3.
Theaboveexperienceaffectstheappraisaloftheprojectintwomajorrespects.
First,theestimatesforpassengercarsandsmalltrucksin1969havebeenincreasedbyaboutone-halfandtwo-thirdsrespectively,and-8-theforecastforordinarytruckshasbeenloweredfrom11,900to5,000perday;theneteffectisareductionfrom22,800to21,500vehiclesperday(seeTable3).
Therateoftrafficgrowthhasalsobeenreducedslightly.
Becauseofthelargernumberofsmallvehiclesandthefewertrucks,thecapacityoftheexpresswrayisnowestimatedat55,000vehiclesperday,com-paredto50,000undertheearliervehiclecomposition.
Second,whilethesavingsintransportcostshavenotchangedmuchformostclassesofvehicles,theyhavebeenreducedsharplyforordinarytrucksfromY21toY15pervehicle/km;thisismainlybecausethetruckershavenotobtainedthefullbenefitsofgreaterspeedandthesavingsinwagesandoverheadarethereforelessthananticipated(seeTable4).
Ontheotherhand,thegreaterutilizationoftheexpresswaybypassengershasincreasedthetimebenefitsovertheearlierestimate.
Theneteffectofthesechanges,andalsotakingintoaccountthebigherconstructioncosts,istoreducethereturnontheinvestmentfrom18percentto15percent.
B.
FinancialReturnoftheProject4X4.
ThespecificsourcesoffundsandthefinancialforecastfortheTokyo-ShizuokasectionoftheexpresswayarepresentedinTable5.
Tollchargeswillbethesameasthoseprevailingonthesectionsoftheexpress-wayalreadyopenedtotraffic,andareshowninTable6.
Thereislittledifferenceintollchargesbetweenpassengercarsandsmalltrucks,theaverageforsuchvehiclesbeingaboutUScents3-4permile.
ThebulkoftrucktrafficexpectedtousetheexpresswayischargedaboutUScents5.
3permile.
TheleveloftollchargesisabouttwicethatonmosttollroadsintheUnitedStates,reflectingmainlythehighercostsofconstructingexpresswaysinJapan.
OperatingandmaintenancecostshavebeenestimatedbytheKodanonthebasisofpastexperience.
4.
5.
Theslightincreaseinthecostestimate,therevisedestimatesforcompositionoftrafficandthelowerrevenuesexpectedinthefirstoperatingyears,haveprolongedthepay-backperiod.
Theexpresswayisnowestimatedtohaveapay-backperiodof22yearsattheaverageinterestrateof6percentnowpayablebytheKodan,comparedwiththeoriginallyestimated20years.
Ifamoreconservativetrafficprojectionismadeonthebasisthatitwillnotexceed50,000vehiclesperday,thepay-backperiodwouldbeextendedfrom22toabout24years.
Thesepay-backperiodsaresatisfactory.
Ifthenetincomewereexpressedasareturnonthenetfixedassetsoftheexpressway,itwouldyieldabout7.
5percentoveranassumedoperationallifeof30years.
4.
6.
TheKodannormallysetsitstollchargesatalevelwhichisintendedtorecoverintheformofrevenueaboutahalftotwo-thirdsofthetotaleconomicsavingstothevehicleswhichuseitsfacilities.
Iftrafficvolumesontheprojectexpresswaydonotincreaseataratesufficienttoproducetollrevenuesadequatetoamortizethetotalcostofthefacilitiesat6percentperannumwithina30-yearperiod,theCorporationwould,inlinewithitsexistingpolicyandafterconsultationwiththeMinistriesofTransportationandConstruction,revisetheleveloftollchargesaccordingly.
4.
7.
However,Kodanisawarethattheconsequencesofanincreaseintollchargesmightbeareductionintraffic,resultinginapossibleworsen--9-ingofboththefinancialandeconomicjustification.
Kodanisthereforeexperimentingwithreducedtollcharges,particularlyfortrucks,onthesectionsofexpresswayalreadyopenedtotraffic,withaviewtoincreas-ingtheutilizationofthesesectionsandtestingtheelasticityoftrafficdemand.
Withthelowerratesproposed(about17percentlowerfortrucks),eveniftrafficvolumesdonotincreasefromthoseoriginallyforecast,revenueswouldstillbesufficienttoresultinapay-backperiodoflessthan30years.
Ifthenetoutcomeisaloweringoftotalrevenuesfromtolls,thentheGovernmentmayneedtoincreaseitscontributiontoKodan.
DuringloannegotiationstheGovernmentinformedtheBankthatitspolicyontollfacilitiesisconstantlyunderconsiderationandreviewwiththeobjectoffurtherrationalization.
C.
FinancialSituationoftheBorrower4.
8.
Kodan'spotentialearningcapacityishigh.
AsshowninTable7,thefinancialresultsofKodan'soperationsshowimprovementastrafficdevelopsoverthemorerecentlyconstructedfacilities.
Thiscanclearlybeseenduringtheperiod1959/60to1963/64.
Sincethefiscalyear1963/64,however,theresultshavebeenadverselyaffectedbydeficitsincurredonthefirsttwosectionsoftheTokyo-KobeexpresswaywhichwereonlyopenedinJuly1963andSeptember1964respectively,andhavenotyetdevelopedsufficientearningpowertomeetinterestcharges.
Comparativefiguresforthepastsixyearsareasfollows:NetSurplus(Deficit)afterInterestChargesTokyo-KobeAllOtherTotalYearExpresswavFacilitiesKodan(Ybillion)1959/60-(291)(291)1960/61-21211961/62_7847841962/63-1,5251,5251963/64(1,019)2,6241,6051964/65(3,153)3,501348Firsthalfof1965/66(1,881)2,1452644.
9.
Theratioofoperatingcoststooperatingrevenue,whichwas65percentin1956/57,theyearinwhichKodanbeganoperations,haddiminishedto26percentin1964/65andtoabout22percentinthesixmonthstoSeptember1965.
ThesummaryofKodan'sBalanceSheet(Table8)showsthat,asofSeptember30,1965,thevalueoftollfacilitiesinoperationwasY197billion(US$547million),ofwhichY126billion(US$350million)representedthecostofthefirstsectionsoftheexpresswayopenedtotraffic.
AcompletelistofKodan'stollfacilitiesinoperationduring1964/65isgiveninTable9.
4.
10.
AsshowninTables10and11,Kodan'sfinancialpositionduringtheperiodofconstructionoftheremainingsectionsoftheTokyo-Kobeexpresswayandalsoforthefirstyearofitsoperation(1969)willbeaffectedbyanincreasingburdenofinterestpayments.
Whereas,during-10-fiscalyear1964/65,interestpaymentequalled73percentofKodan'stotalrevenues,itwillabsorb83percentoftherevenuein1968/69.
Inthislatteryeartotalrevenuesarenotsufficienttocovercashoperatingandmaintenanceexpensesandtopayinterestondebt.
After1969/70,whenthewholeTokyo-Kobeexpresswaywillbeopentotraffic,increasingtollreve-nuesareexpectedtoalleviatethesituation.
4.
11.
Kodanchargesdepreciationonlyonasmallpartofitsfixedassets;tollfacilitiesarenotdepreciatedintheordinarysensebutappro-priationstoreservesaremadefromrevenueforwriting-offthevalueoffacilities.
ThemechanicsoftheaccountingsystemaredetailedinthenoteattachedtoTable9.
4.
12.
WithGovernment'sapproval,animportantmodificationofpolicyregardingtheperiodduringwhichtollsmaybechargedwasmadeeffectiveasofMay1,1965.
Priortothatdateeachtollfacilitybecametoll-freeimmediatelyafteritsnetincomehadrepaiditsconstructioncost.
AfterMay1,1965,however,freedomfromtollswillnotbeeffectiveuntilcon-structionandrelatedcostshavebeencompletelyamortizedandtollshaveinadditionbeencollectedonanumberofvehiclesequivalentto15percentofthetotalwhichenacedthefacilitytopayoffitscost.
Sincethedateonwhichthismodi2icationofpolicywasintroduced,twotollroadshaverepaidtheircostsandwillcontinuetocontributetotheKodan'sreservesforapproximatelytwoyears.
WithinthenextseveralyearssimilarbenefitswillaccruetotheKodanfromanumberofotherfacilities.
TheultimateresultwillbeasubstantialannualaccrualtothereservesoftheKodan.
4.
13.
Theforecastbalancesheetfigures(Table11)reflecttheconsider-ableinvestmentprogramwhichKodanplanstocarryout.
Tofinancethecapitalexpenditures,Kodanwillrelyonincreasinggovernmentinvestment,theexistingandproposedIBRDloans,andthefloatingofRoadBonds.
ItisintendedtofloatYen550,000millionRoadBondsintheoperationalyears1965/66through1968/69,oranaverageofaboutYen138,0C0millionannually.
AboutYen68,000millionofthisadditionalborrowingwillbeneededtore-financematuringdebt.
4.
14.
TheinvestmentprogramoftheKodanissubjecttotheapprovaloftheJapaneseGovernment,whichingivingitsapprovaltotheexpenditurealsogivesassurancethatthefundsneededtosustaintheprogramwillbemadeavailable,anditfollowsthereforethatiftheJapanesecapitalmarketshouldnotallowthefloatingofbondstotheextentenvisaged,theGovern-mentwillmakegoodthedeficiency.
NospecialsignificanceneedthereforebeplacedonKodan'spossibleshortageofworkingcapitalasforecastfortheyears1966/67through1968/69.
4.
16.
KodanisinfactthepublicexecutingagencyoftheGovernmentforexpresswayconstruction,althoughinformandfinancialstructureitisasemi-autonomoustollroadauthority.
IthasthefullfinancialsupportofGovernmentanditssubstantialburdenofdebt,resultingfromavery-11-expensiveconstructionprogram,thereforebecomeslessimportantafactorwhenassessingitscreditworthinessasaBorrower.
Kodan,withitspresentpolicy,appearstobederivingaboutthemaximumrevenuesfromtheusersofitsfacilitiesand,asmentionedabove,bycontinuingtollchargesforacertaintimeafterconstructioncostshavebeenrepaid,itsrevenuereserveswillbesubstantiallystrengthened.
Thereislittlereasontodoubtthatwhenthenewexpresswayiscompletedandastrafficthereondevelops,thefinancialpositionoftheBorrowerwillprogressivelyimproveuntilaverysoundsituationisreached.
-12-5.
CONCLUSIONSANDRECOMMENDATIONS5.
1.
ThecompletionoftheThirdExpresswayProject,whichisexpectedinthefirsthalfof1969,willalleviateaseriousshortageintransporta-tioncapacityinoneofthemostdenselypopulatedandhighlydevelopedregionsinJapan.
Theproject,startedin1963,remainstechnically,economicallyandfinanciallysound,althoughcostestimateshaveincreasedslightly,andeconomicbenefitsandrevenuesfromtollshavedeclined,com-paredwiththeoriginalappraisal.
TheproposedloanofUS$100million,togetherwiththeoriginalloanofUS$75million,wouldraiseBank'sparti-cipationintheprojecttoabout33percentofitsconstructionandlandcost.
5.
2.
TheBorrower,NihonDoroKodan,alreadywellknowntotheBank,isexecutingtheprojectsatisfactorilyandisconsideredfullycapableofoperatingandmaintainingitproperlyaftercompletion.
GovernmentpolicytowardsKodanandtollexpresswaysgenerallyisexpectedtoguaranteethesatisfactorycompletionandoperationoftheprojectasanessentiallinkinthecountry'stransportationsystem.
5.
3.
TheprojectconstitutesasuitablebasisforasupplementalloanofUS$100milliontotheKodan.
Atermof15yearsincludingaperiodofgraceof3yearsisrecommended.
ProjectsDepartmentJuly18,1966JAPANSUPPLEMENTARYAPPRAISALCFTHETHIRDEXPRESSWAYPPOJSCTBANKFINANCINGOFTOKYO-KOBEEXPRESSWAYEligibleBank'sParti-forBankcipationinAppraisalExpresswayLengthTotalFinancingBankEligibleLoanCompletionRef.
LoanNo.
ReportNo.
Section(km)Cost1//LoansExpendituresSignatureDate------(U.
S.
$million)1248-JATO-236aAmagasaki-Ritto72125120403317/3/60Jul.
19632/2302-JATO-300ai)Nishinomiya-Amagasaki733160402529/11/61Sep.
1964ii)Ritto-Ichinomiya104141Apr.
1964-Sep.
19643357-JATO-384aTokyo-Shizuoka1617527/9/63Sep.
1968-Sppeenaf5L952033Apr.
196914-TO-.
"(Supplementaryni1000loan),5374-JATO-409aToyokawa-Komaki78170150503322/4/64Sep.
1968-Apr.
1969613-JATO-474aShizuoka-Toyokawa106280260752926/5/65Apr.
1969---Komaki-Ichinomiya822----June1965TotalTokyo-Kobe5361,3201,210380'31April19691/Construction,rightofway,andengineeringonly(excludinggeneraladministration,research,andinterestduringconstruction)/TheterminalinterchangeintheKobe/Osakametropolitanarea.
2Disbursementsofloanfundsaremadeagainst"eligibleexpenditures"comprisingconstructionandright-of-waycostsafteranappointeddate.
TABLE2JAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTORIGINALANDREVISEDESTIMATEOFPROJECTCOSTAmount(Ybillion)OriginalRevisedI.
ConstructionCost(Sept.
'63)(Dec.
'6)_(Paymentstocontractors&suppliers)1.
Earthwork28.
629.
12.
Pavement7.
57.
93.
Medianstrip1.
81.
84.
Tunnels7.
27.
55.
Bridges24.
624.
06.
Viaducts19.
118.
37.
Floodreliefopening1.
11.
18.
Accessfacilities5.
65.
39.
Trafficcontrolfacilities1.
41.
410.
Preparatoryworkincludinghardroads2.
12.
111.
Miscellaneouswork0.
40.
412.
Provisionforoverheads&profit14.
915.
013.
Appurtenantworks(oldfacilityrelocation)2.
62.
9Sub-total116.
9(72%)116.
8(63%)II.
Right-of-Way&Compensation37.
8(23%)59.
6(33%)III.
Survey&FieldSupervision1.
Surveyandtesting1.
61.
92.
Nurserygarden0.
10.
13.
Communicationfacilities0.
50.
54.
Machineryandtools1.
21.
15.
Buildingonsite1.
51.
96.
Fieldofficeexpenses1.
41.
37.
Administrativeexpenses0.
80.
8Sub-total7.
1(5%)7.
6(4%)Total161.
8(100%)184.
0(100%)IV.
ContingencyAllowance1.
Construction18.
1(15%of9(7.
5%ofconst.
const.
cost)cost)2.
Right-of-way6.
2(15%of3(5%ofr.
o.
w.
)r.
o.
w.
)Sub-total24.
3(15%)6126W)V.
TotalFieldExpenditures186.
1196VI.
AssociatedResearch&GeneralAdministration8.
28.
4VII.
InterestduringConstruction31.
626.
2GrandTotal225.
9230.
6(US$equivalent)($628million)($640million)TABLE3JAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTESTIHATEOFAVERAGEDAILYTRAFFICONTHETOKYO-SHIZUOKAEXPRESSWAY1959-1984*(NumberofVehicles)--PassengerCars--Trucks------YearOrdinarySmallBusesOrdinarySmallOthersTotal1969200091009005000410040021500197430001440012009000580050033900197938002060017001h2007300600482001984430023500190016500810070055000*ThenumberofvehiclesaretheequivalentvehiclestravellingthetotallengthoftheSection.
Trafficafter1984isassumedtoremainatthelevelreachedinthatyearastheSection'scapacitywillbereachedthenandadditionalcapacitywillbeneeded.
JAPANSUPLEMENTARYAPPRAISALOFTHETHIRDERPRESSWAYPPOJECTCCMPARISONOFOPERATINGCOSTONTHE7XISTINGHIGHWAYANDTHETOKYO-SHIZUOKAEXPRES3W,3,AY,1969(Yenperve'icle-km)f~Passenger_CarsBU.
ES'TRUCKSTYPE'OrdinarySmall'OrdinarySmallof'Exist.
Express-Exist.
Express-Exist0Express-Exist.
Express-Exist.
Express-C0ST'High-wayHigh-wayHighI-wayHigh-wayHigh-wjay'waywaywaywaywayFuelandOil5.
66.
93.
84.
59.
012.
49.
613.
54.
05.
4TiresloO1040.
91.
23,54.
92.
94.
11.
01.
4Maintenance4.
73.
72.
31.
84.
63.
64.
33.
42.
01.
6Depreciation11.
56.
85.
73.
316.
89.
86.
84.
05.
43.
3Wages----13.
17.
816.
611.
99.
95.
5OverheadandMisc.
3.
42.
23,42.
116.
8101419.
9314.
411.
87s1Operatingcost(Sub-total)26.
221.
016.
112.
963.
848.
960.
151.
334.
124.
3ReductionforTaxes(Sub-total)7.
07.
03.
23.
95.
1',.
34.
35.
53,44.
3NetOperatingCost19.
214.
012.
99.
058.
742.
655.
845.
830.
720.
0AllowanceforIncreasedCongestion1.
9-1.
3-5.
9-5.
6-3.
1_Total21.
114.
014,29.
0640642.
661.
445.
833.
820.
DCostReduction17.
1'5.
2t22.
0t15.
6r13.
8(;,)t(33)t(36)t(34)(25)(41)Source:NihonDoroKodan(JapanHighi-ayPublicCorporation)JAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTFINANCIALFORECASTOFTHETOKYOSHIZUOKAEXPRESSWAYApplicationofFundsEDarecofPundsConstructionTotalRightof'ayResearchInterestFiscalProjectandanaDuringIB0DI3RDGovernmentRoadGovernnentYearsCostComoensationAdanisetrationConstruction3rdLoanBorrowinBondsInvestment(Yenbillion)(Yenbillion)1961/620.
1-0.
1---0,1-1962/631.
31.
10.
2-1.
10.
21963/644.
43.
80.
40.
20.
7-0.
13.
00.
61964/6518.
117.
00.
50.
63.
23.
88.
82.
31965/6638.
034.
01.
2.
58.
829.
2-1966/6752.
145.
1l.
,N5.
1217.
574.
52.
617.
038.
51967/6873.
261.
82.
68.
84.
51.
43.
711.
1968/69_13,33UJ4.
510.
5-42L76.
'29_G27.
0i5J_1.
IncomeAccountFeorecastEstimatedtotalnumber(bi111on)ofvehiclesVlorkingSurplusorOutstandingsetdavRevenuesExpensesInterest)i(Deficit)Balance2-1968/691.
6.
84.
0(3.
2'233.
82969/7021,50011.
91.
914O(4.
0)2_7.
01970/7113.
02.
014.
3(3.
3)24111971/72141.
42.
014.
5(2.
1)243.
21972/7315.
62.
o14.
6(LO)264.
21973/7417.
72.
114.
70.
4243.
81974/7534,00018.
S'-414.
60.
924z.
9IQ75/7620.
62.
614.
63.
-239.
51976/7722.
02.
514.
45.
1234.
41977/7823.
52.
51wl639227.
51973/7925.
23.
013.
78,5219.
01979/80E48,00026.
93.
213.
110.
62C8.
41980/8128.
84.
1126512.
2196.
219-1/8229.
63.
011.
814.
8181.
1*1982/8330.
03.
210.
9i5.
9165.
51983/8435.
3.
19.
917.
3148.
2198t/8555,00030.
7358.
918.
3129.
91985/8630.
77.
819.
6110.
31986/8730.
74.
56.
6p.
690.
71987/as30.
73.
390*2206.
71988/8930.
74.
0Lb122.
646.
11989/9030.
73.
92.
624.
221.
91990/9155,00030.
7379.
225.
829)J/Interestat6ffonbalanceatbeginnin^ofyoar.
2JInaccordancenrLthKodan'spractice,outstin-nl'balanecisre(iucuAdbysurolusandincreasedbydeficit.
TABLE6JAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTSCHEDULEOFPROPOSEDTOLLCHARGESEquivalentYenUSCentsTypeofVehiclePerKmPerMilePassengerCarsS-mall7.
53.
4Ordinary9.
54.
2TrucksSmall7.
53.
4Ordinary11.
5(9.
5)V5.
2(4.
2)TruckorTractor-TrailerCombinationsWith3axles17.
07.
6With4ormoreaxles22.
0(17.
0)1/9.
8(7.
6)BusesRegularService16.
07.
2Other22.
09.
8/Reducedchargesasproposedinparagraph4.
7.
JAPANSUPPL3ENTARYAPPRAISALOFTHETIIRDEXPRESSliAYPROJECTNIHON!
DOROKODANSUIRARYSTATE'EliTOFREVENlJE5AI)DEXPENDITUREYearEndedMarch31Half-yearended195815196026119211965September3).
1965(YenMillions)Operatingrevenues26447789414092327335447938349124947365Non-operatingrevemruesl/111584891268182201281591963755359421lOO2595353649948650130857461Cashoperatingexpenses1722644605787629261173193228371360Interestandbonddiscount2873949001188172817222177487095345615Totalcashoutgoings459658136017662490264833506802123716975Netcashsurplusor(deficit)(84)(123)(418)(266)10588816441828714486Other(nou-cash)operatingexpenses:Depreciation2/262025516669138281168Periodicmaintenanceandrenewalsequalizationprovision----141423414220Staffretirementprovision--27-19242744'433426472584104119223366222Netsurplusor(deficit)(86)(129)(465)(291)217841525,1605*48264Appropriationstoreserves:Forfuturelonsofrevenuei/---691131614617391176591Forwriting-offvalueoffacilitieswhichbecometoll-free-5/2652671844771031149223'7927311648Totalaopropriations2652672535901192195"11839072239Netdeficitasreportedinaccounts.
L2.
)(181)(532)(544)(569)(408)(428)(l;1l)(3559)(1075)Notesi/Pr1ncapallyinterestonshort-terminvestmentsandde,ooits.
i/Bonddiscountislessthan25ofthecombinsdfigureineachyear.
2/Depreciationonlyonparkingelaces,servicefacili;ilesandocherfixedassets;excludingroads,bridgesandtunnels.
|5'oftollrevenuesin1959/1960and1960/1961;thereafter10;;oftollrevenues,exceptexpressways,whichremain55'.
/Appropriationtoreserveisequivalenttotietotalofthenetincomeearneddurin-theaccountingocriodbyeachindividualtollfacilitywhichhasanaccunulatednitsurplustoitscredit.
JAPANSUPpLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTNIHOND00ROlODANSUVMARYBALANCESHEETSAsatAsatAsatAsatMarch31,1963march31.
1964March31.
1965September30.
1965(Yenlillion)I.
FIXEDASSErSa)Inoperation-Roads,bridges,tunnels-atcosti/48,433103,528_/187,569Z/196,967Parkingplacesand-ervicefacilities)Netofdepreciation1,1402,4593,1443,087Otherfixedassets)1,4523,3805,5715,845b)Underconstruction96886978890814TotalFixedAssets147,911207,256274,748306,713II.
WORKIN2CAPITALa)CurrentAssets4,6455,3798,0065,003b)DeferredAssets3/9501.
1111.
25514135,5956,4909,2616,416Deduct:a)CurrentLiabilities2,3593,4695,3366,028d)DeferredLiabilities!
375561675al2,7344,0306,o0l6,839NetWorkingCapital2.
8612.
460lam(423III.
TOTALASSETS209.
716277.
9983620IV.
LOWN-TERMDEBTa)RoadBonds76,308116,834152,490176,552b)OtherLong-TermBorrowing42.
S8450.
27972.
65676.
620TotalLonr-TermDebt118,892167,113225,146253,172V.
GOVERMi4ENTEQTITYa)GovernmentInvestment25,03934,53945,01545,015b)Governmen3>GrantforConstruction5,4965,4965,4965,496a)Reserves24L.
1206856J1001872/12.
42734,65546,89060,69862,938d)DeductsDeficitafterAppropriationtoReserves2.
77542877.
81469.
820TotalGovernmeentEauit.
31.
88042.
6052.
85253.
118VI.
TOTALCAPITALDEBTAND)GOVERINIENTEQUITYQ2209.
7162NRtes:1/Maintenanceendrenewalschargeabletorevenue.
3/Buildings,vehicles,tools,etc.
/Princioallyroadbonddiscountandexpensesforresearch.
/lMaintenanceequalizationandstaffretirementprovisions.
Reservesforfuturelossofrevenueandvriting-offfacilitieswihichbecometoll-free.
i.
educedbyYen383pillionmnrespectofTorikaiBridge,writtenoffKodanbook-,in1963/1964whenitbecamefreeoftollsconsecuentuponitSearnednetinconehavinarepaiditsconstructioncosts.
7/ReducedbyYen563rillioninresoectoftheTozukasectionoftheYokohamaHighway,writtenoffKodanhooksin1964/1965whenitbecamefreeoftollsconsequentuponitsearnednetinconmhavingrepaiditsconstructioncosts.
JAPANSUPPLEMENTARYAPPRAISALOFTHETHIPDEXPRESSWAYPROJECTNIHONDOROKODANINCOMEACCOUNTOFTOLLFACILITIES(FromApril1,1964toMarch31,1965)Bait:TbousajdIan)-ExpensesNupuonesofRvnoExpensesFacilitiesainuesi-te-.
tWrTotalorDeficitNInterestWorkineTorDeficit]1.
AkkeshiFerry25,9479,53030,10939,639-13,6914b.
TonbaraHighway6,417U,1164,71818,834-12,4172.
SonninTunnel28,44924,90524,49849,403-20,95447,MakunouchiTunnel24,2059,98011,49821,4782,7273.
KayookaHighway14,88131,91713,50445,421-30,53948.
OndoBridge45,42123,46618,17841,6443,7774.
ZaoHighway49,26432,18747,16979,356-30,09249.
NarutoFerry122,97221,218106,476127,694-4,7215,Bandai-AzumaHighway65,94022,92738,38761,3144,62650.
Higashi-IyoHighway35,94321,12816,95538,083_2,1396.
KaimonBridgo20,05115,10512,05727,162-7,11051.
ChofuHighway95,86031,19831,08062,27833,5817.
ChoshiBridge93,47755,29427,82683,12010,35652.
KenmonTunnel|947,991391,731329,723721,454226,537j8.
SakaiBridge29,13931,91712,70044,617-15,47753,Kita-KyushuHighwy188,520127,13162,609189,740-1,2209.
NikkoHighway62,16212,76721,73434,50127,66154.
WakatoBridge349,262370,423114,617485,040-135,77710.
IkahD-HarunaHighway85,83434,88440,71475,59810,23555.
OkawaBridge108,0256,02428,77334,79773,22811.
KusatsuHighway12,3268,7217,67516,396-4,07056.
SurinoeBridge8,49315,2847,04722,331-13,83712.
Ke2aigoBridge108,,3976,92327,76934,69273,70457.
Sa3kaiBridge42,93443,15620,58063,736-20,80113.
MefukiBridge80,82918,16126,22144,38236,44658.
UnzenHighway30,19818,07214,81432,886-2,68814.
KeiyoHighway810,509116,252192,157308,409502,10059.
ShimabaraHighway30,02732,00716,51048,517-18,48915.
ThirdKeihinHighway21,19588,47011,41499,884-78,68960.
AsoHighway69,9209,08121,37930,46039,45916.
YokohamaHighway780,00222,657205,170227,827552,17461.
NakanotaniTunnel50,34049,45020,51669,966-19,62617.
ShonanHighway130,25337,31243,00180,31349,93962.
Beppu-AsoHighway155,93779,29949,914129,21326,72418.
ManamuniHighway234,63913,12752,72465,851168,78863.
KirishimaHighway52,71133,26644,92078,186-25,47519.
HakoneHighway377,054139,53893,896233,434143,62064.
Nagoya-Kobe20.
OtomHighway20,14618,0728,84226,914-6,768Expressway3,961,7435,833,079,281,5857,114,664-3,152,92121.
KoshijiBridgo10,5419,44014,45623,896-13,35522.
SasagoTunnel270,11149,89967,124117,023153,087Sub-Total12.
131,6648,826,310,098,08912,924A,399-792,73423.
Higashi-IzuHighway159,32476,78251,551128,33330,99124.
TogasaymlaHighway21,99434,79514,16048,955-26,9601.
ZaoParkingPlace4,9379895,4726,461-1,52325.
ShimodaHighway47,99410,96920,69231,66116,3332.
AtagawaParking26.
XkezukaBridge42,53325,98318,88844,871-2,338Place2,0698091,7872,596-52627.
TateyamaHighway9,19011,77812,25724,035-14,8453.
HibiyaParking28.
TakefuTunnel162,1969,35045,64454,994107,201Place204,26564,644104,879169,52334,74129.
TsurugaHighway120,58755,11433,97489,08831,4984.
NagahoriParking30.
Ogaki-HaJimaHighway35,59557,63121,69779,328-43,732Place42,80589,369121,523210,892-168,08831.
NobiBridge127,67626,25331,30057,55370,123Sub-Total254,076155,811233,661389,472-135,39632.
KimmraBridge75,19428,323122,00250,32324,87033.
AigiHighway53,52327,69227,61655,308-1,7841.
YoroServiceArea3,7211,5281,0052,5331,18834.
IsegamiTunnel8,85127,9629,29137,253-28,4022.
TagaServiceArea5,2522,o681,5683,6361,61535.
SanguHighway106,6468,72129,72338,44468,2013.
OtsuServiceArea115,1884,94514,47319,41895,76936.
MeiyonHighway442,284174,87299,500274,372167,9124.
SuitaServiceArea2,8151806888681,94637.
HigashiyamaHighway15,77416,63313,62130,254-14,480Sub-Totl126,9768,72117,73426,455100,52038.
AJikawaBridge295,62664,28592,310156,595139,030"bo"39.
AkashiFerry140,04126,163117,396143,559-3,518GrandTotal112,512,7168,990,84,349,48413,340,326R827,61i40.
ShimmelHighway56,04729,58023,98153,5612,48641.
HannaHighway392,91649,719111,760161,479231,43642.
KoyasanHighway40,51640,18921,91162,100-21,58443.
ShirahamaHighway43,36041,44818,54759,995-16,63444.
DaisenHighway26,61336,14319,80855,951-29,33745.
MatsueHighway49,12016,81319,42136,23412,8851Notes2.
1Beauseofrounding,totaldoesnotalwaysagreeviththesumofindividualitems.
aAlooinoludeappropriationstoreserveforfuturelo.
ssofrevenue.
aInterestandbonddiocount,9,534.
242lessinterestrevsnu.
s543,400.
'OSeeTable9,pageiiforNoteonAcoountingSyutem.
TABLE9PageiiJAPANSUPPLEiIENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTNIHONDOROKODANNoteonAccountingSystem1.
Aseachnewfacilityisundertaken,itsexpectedpay-backperiodiscalculatedonthebasisofassumptionsabouttraffic,rateoftolls,operationandmaintenanceexpenditure,andanotionalinterestattherateof6percentontheunamortizedbalanceofitscost.
EachfacilityotherthantheExpresswaywillbecometoll-freeonwhicheverofthefollowingdatesistheearlier:(a)attheendofitsexpectedpay-backperi.
od,or(b)whenithasearnedsurplusessufficienttopayoffitsoriginalcostandthereafterhascarriedanadditionalnumberofvehiclesequalto15percentofthetotalnumberofvehicleswhichenabledittopayoffitscost.
The15percentadditionaltrafficprovisiondoesnotapplytotheExpressway,which,accordingtopresentarrangements,willbecometoll-freewhenithasearnedsurplusessufficienttopayoffitsoriginalcost.
2.
Eachyearthetotalofinterestpaid(lessinterestchargedtoconstructionandinterestrevenues)isnotionallychargedtothevariousfacilitiesinoperationinproportiontotheirbookvalueatthebeginningoftheyear.
Ifthetollrevenuefromagivenfacilityislessthanitsoperationandmaintenanceexpensesplusitsshareofinterest,thedeficitisnotionallyaddedtoitsunamortizedcost;anysurplusisnotionallydeductedfromtheunamortizedcost.
3.
Somefacilitiesproducemorerevenuethanwasforecast.
Othersfailtoproduceasmuchrevenueaswasexpected,andsoreachtheendofthepay-backperiodwithabalanceofcoststillunamortized.
Inorderthattheremaybeadequatereservestowrite-offtheresidualvalueofthosefacilitieswhichfailtoproducerevenuesufficienttoamortizetheiroriginalcostwithintheirexpectedpay-backperiods,DoroKodanplacestoreserve10percentofthegrossrevenuesoftollfacilitiesotherthantheExpressway,5percentofgrossrevenuesoftheExpresswayandthewholeofthenetrevenueearnedunderthetermsofthe15percentadditionaltrafficprovisiondescribedinparagraphl(b)above.
4.
Thenetsurplusesearnedbyallfacilitieswhoserevenueshavemorethancoveredworkilgcosts,interestchargesandappropriationstotheforegoingreservearetransferredtoareserve,describedas"DepreciationReserve.
"Againstthisreservetheconstructioncostofeachsuchfacilitywillbewrittenoff.
TheaccumulatednetdeficitoneachoftheremainingfacilitiesiscarriedforwardintheDeficitAccount,pendingadevelopmentofrevenuessufficientineachcasetoliquidatethedebitbalance.
Iftheendofthepay-backperiodshouldfindthefacilitystillindeficit,thebalancewillbeclearedbychargetothereservedescribedinparagraph3.
JAPANSUPPLEMENTARYAPPRAISALOFTHETHIRDEXPRESSWAYPROJECTNIHONDOROKODANFORECASTOFREVENUESANDEXPENDITURES(InmillionYen)YearsendingMarch311966196719681969OperatingRevenues15,18222,85724,66735,106Non-OperatingRevenues55622051033115,53823,1O725,17735,437CashOperatingExpenses3,8434,4694,9956,359InterestandBondDiscount11,81915.
32315,5892.
2L14TotalCashOutgoings15,66219,79220,58435,773NetCashSurplusor(Deficit)(124)3,3154,593(336)Other(non-cash)OperatingExpensesDepreciation1/351376366601PeriodicMaintenanceProvision40414141StaffRetirementProvision77808415046849491792NetSurplusor(Deficit)onoperations(592)2,8184,102(1128)AppropriationstoReserves:ForFutureLossofRevenue1,2311,8721,9992,673ForWriting-offValueofFacilitieswhichbecometoll-free2,9765,0875,2445,312TotalAppropriation4,22076,9597,2437,985NetDeficitafterappropriations(4799)(4141)(3141)(9113)NotesSDepreciationonlyonparkingplaces,servicefacilitiesandotherfixedassets;excludingroads,bridgesandtunnels.
JAPANSUPPLEMENTARYAPPRAISALCFTHETHIRDEXPRESSWAYSJECTNIHONDORCKCDANPRO-FORMABALA1NCESHEET(InmlllionYen)AsatMarch31-15bi_196719681269I.
FixedAssetsa)InOperationRoads,Bridges,Tunnels-atcost223,799234,473252,382549,915ParkingPlacesandServiceFacilities)Netof3,0373,5353,3993,263OtherFixedAssets)Depreciation5,8975,7125,3895,747b)UnderConstruction136917267.
145515,774405.
068TotalFixedAssets369,650510,865776,944963,993II.
WorkingCapitala)CurrentAssets7,7611,0691,0871,215b)DeferredAssets2,1122,5874,8036,0849,8733,656-5,8907,299Deductc)CurrentLiabilities5,6667,61110,96813,416d)DeferredLiabilities9041,1021,4201,794NetWorkingCapital3.
303(5,057)(6.
L98)(7.
911)III.
TotalAssets372,953505,808770,446956,082IV.
Long-TermDebta)RoadBDnds237,919313,752498,903634,203b)Otberlong-ternborroving82,772121,939156,407178,650TotalLonsz-TermDebt320,691435,691655,310812,853V.
GovernmentEauitya)GovernmentInvestment45,01560,415105,015140,915b)Governmentgrantforconstruction5,4965,4964,8273,697c)Reserves14.
39620.
99225.
22127.
65764,90786,903135,063172,269d)Deduct:DeficitafterappropriationtoReserves12,64516,78619,92729,040TotalGovernmentEquity52,26270,117115,136143.
229VI.
TotalCapitalDebtandGovernmentEquity372,953505,s08770,446956.
A82Debt/EquityRatio86/1486/1485/1585/l5MAP1Wokkon,\HOKKAIDO42°JAPAN42oNATIONALHIGHWAYSYSTEMEXISTINGPRIMARYAomoINATIONALHIGHWAYSEXPRESSWAYPROJECTSCOMIPLETED:FirstandSecondEXPRESSWAYPROJECTSUNDERCONSTRUCTION:.
k,oThirdFourthandFifth050100150200KILOMETERS050too520oOSendoa,MILESh,zuo~~~Chb0~4(5ilA]~~)IOKUPAC/F/COCEAN2°o°,lrYUSHUM,yazok,MAY1966IBRD-1224R3MAP2aTokoidora-l1-y6lanes)JAPANI-0NewTokoidoa-lway41anesProject-p-waysandinterchangesTOKIO-SHIZUOKATHIRDEXPRESSWAYPROJECTContourstnmetersExistngpr-maryandsecondaryExpressa-yscompletednationalhighways05052025-ExpreswaysplannedforProposedprsmaryandsecondaryMILEScompletionbefore1969-natonalhsghways0510152025igwBoovKAMKRAjMAY1966IBRD-12ZSRI