The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) REPORT NO.: RES52628 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF PUBLIC EXPENDITURE MANAGEMENT NETWORK IN ASIA - PHASE 2 APPROVED ON JUNE 30, 2021 TO KOREAN INSTITUTE OF PUBLIC FINANCE GOVERNANCE EAST ASIA AND PACIFIC Regional Vice President: Manuela V. Ferro Regional Director: Hassan Zaman Practice Manager: Alma Kanani Task Team Leader(s): Quyen Hoang Vu The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) ABBREVIATIONS AND ACRONYMS EC European Commission EDD End of Disbursement Date KIPF Korean Institute for Public Finance MDTF Multi-Donor Trust Fund MOEF Ministry of Economy and Finance PEMNA Public Expenditure Management Network in Asia RE Recipient-Executed WB World Bank The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P175749 Investment Project Financing Environmental and Social Risk Classification (ESRC) Low Approval Date Current Closing Date 30-Jun-2021 31-Dec-2023 Organizations Borrower Responsible Agency Korean Institute of Public Finance Korean Institute of Public Finance Financing (in USD Million) FIN_SUMM_PUB_TBL SUMMARY Total Project Cost 0 Total Financing 0 Financing Gap 0 DETAILS -NewFin3 The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) Project Development Objective (PDO) Original PDO The overall objective of PEMNA2 is to facilitate knowledge exchange among budget and treasury officials to increase their capacity for better Public Financial Management. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net TF Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-B6223 30-Jun-2021 20-Aug-2021 20-Aug-2021 31-Dec-2023 1.50 1.47 .03 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Rationale This restructuring paper seeks the approval of regional vice president on the revision to the grant amount from US$1.5 million to US$2.92 million and other minor revisions to the Grant Agreement, as per the request of the recipient. The revision of the grant amount fits within the project envelope. The restructuring does not include any additional financing. All other aspects remain unchanged. The proposed change to the Grant Agreement will enable the team to complete all planned Recipient Executed activities, including face-to-face peer learning events, that were originally planned, as well as provide financing to the Korean Institute of Public Finance (KIPF) to continue their role as Secretariat for PEMNA for another year and deliver on the planned objectives. B. Project Status The Public Expenditure Management Network in Asia is a peer-learning network for the Asia-Pacific region. The first phase of the network came to completion on June 30, 2020, and a second phase was launched with the establishment of a new PEMNA II MDTF with total signed contributions of approximately US$4.6 million from the European Commission (EURO 2 million) and the Government of Korea (US$2.3 million). The TF supports Recipient Executed (RE) activities and Bank Executed (BE) activities. The RE grant is being implemented by the PEMNA Secretariat housed within the Korean Institute of Public Finance (KIPF), while main beneficiaries are the fourteen member countries in the region. While the TF was established in October 2020, the preparation and approval of the PEMNA2 RE grant were delayed due to the Covid-19 pandemic and its impact on Bank operations. At the Decision Meeting at Appraisal Stage, chaired by Samia Msadek (Director, Strategy and Operations EAPVP), held between June 21 and 25, 2021, it was agreed for the RE activities and captured that ‘…an extension would be appropriate and therefore should be explored by the team. Likely this extension will be for one year….’. The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) A one-year no-cost extension of the End of Disbursement Date (EDD) of the Public Expenditure Management Network in Asia - Phase II Multi-donor Trust Fund (PEMNA II MDTF) (TF073455) has been approved in May 2022 by the Regional Vice President, changing the EDD from April 30, 2023, to April 30, 2024. The Project no-cost extension has also been approved on December 24, 2022 to reflect the change in the MDTF EDD. Accordingly, a notice of extension of closing date of the Grant Agreement with the Korean Institute for Public Finance (KIPF) was issuded by RVP in 2023. Despite the lockdown and travel restrictions imposed amid Covid-19, strong progress has been made on all of the components of the RE grant. Successful events included the Annual Conference in 2021 on ‘Sustainable and Resilient Capital Expenditures for a Post-COVID Recovery’; the Annual Plenary Conference 2022 in Seoul on ‘Fiscal Soundness and Sustainability for the Post COVID-19 Era’; and multiple online as well as offline Budget CoP (B-CoP) and Treasury CoP (T- CoP) events; several virtual Knowledge Exchanges as well as the introduction of a new business line of PEMNA advisory services. Events organized by PEMNA focus on capacity building and require ample time for preparation and follow-up by member countries. There are no pending audit reports and IFRs for the project. II. DESCRIPTION OF PROPOSED CHANGES The proposed amendment is the revision of the grant amount, from US$ 1.50 million to US$ 2.92 million as per the intended and approved amount in the concept note. The original grant at project effectiveness was based on available funds and hence adjusted to a lower amount of US$ 1.50 million. Since the total approved grant amount for the project is US$ 2.92 million, an amendment to the grant amount is now required to accommodate additional installments to the recipient, now that the total pledge amount has been fully paid into the World Bank by the PEMNA MDTF donors. The need for this change was foreseen and documented at the concept stage in the project document. The funds to accommodate the change are now available through the existing Trust Fund. PEMNA will prepare an annual budget and work plan to reflect the change in the grant amount, for approval by its Steering Committee. As there are no changes to the nature of the financed activities, the environmental and social risk is assessed to remain low. The Korea Institute of Public Finance (KIPF) has continued to implement material measures and actions in a way that PEMNA is implemented in accordance with the ESCP agreed upon in June 2021. KIPF already has a dedicated working unit with qualified staff and resources to support the management of environmental, social, health, and safety risks and impacts of the Project. KIPF provides suitable working conditions for staff working on the Project and adheres to Korean national laws and regulations regarding labor and working conditions. It also has a grievance/feedback mechanism established for all staff and contract consultants that are involved in the PEMNA project. The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) III. SUMMARY OF CHANGES Changed Not Changed Additional Financing Proposed ✔ Disbursement Estimates ✔ Other Change(s) ✔ Implementing Agency ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Change in Overall Risk Rating ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_ADDITIONAL_FINANCING_TABLE ADDITIONAL FINANCING Source Currency Amount USD Equivalent Miscellaneous 1(MSC1) USD 1,420,000.00 1,420,000.00 Existing Net Commitment USD Amount 1,500,000.00 The World Bank Public Expenditure Management Network in Asia - Phase 2 (P175749) Total 2,920,000.00 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes Expected Disbursements (In US$) Fiscal Year Annual Cumulative 2021 0.00 0.00 2022 0.00 0.00 2023 0.00 0.00 2024 0.00 0.00