The World Bank Implementation Status & Results Report KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) EUROPE AND CENTRAL ASIA | Kosovo | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2017 | Seq No: 11 | ARCHIVED on 18-Jul-2023 | ISR56318 | Implementing Agencies: Ministry of Industry, Entrepreneurship and Trade, Republic of Kosovo Key Dates Key Project Dates Bank Approval Date: 18-May-2017 Effectiveness Date: 18-May-2018 Planned Mid Term Review Date: 30-Mar-2021 Actual Mid-Term Review Date: 05-May-2021 Original Closing Date: 30-Oct-2022 Revised Closing Date: 30-Oct-2023 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) To support product certification for export markets, strengthen the capacity of export-oriented firms and reduce the cost of business inspections. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Component 1: Enhancing Business Environment and Export Readiness:(Cost $14.72 M) Component 2: Project Implementation and Coordination Support:(Cost $0.55 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions This is the eleventh Implementation Status Report (ISR) for Kosovo Competitiveness and Export Readiness Project (CERP). It covers the period from September 2022 to May 2023. Significant progress has been made under the subcomponent on “Supporting MSMEs to Improve Export Readiness” through the matching grants program. For the second round of matching grants,125 agreements are under implementation, with most of the funds expected to be disbursed. Progress under the inspections subcomponent has been limited due to significant delays with deciding on the implementation modalities for the e- Inspections. The General Inspector's Office (GIO) is still in the process of being staffed to fulfill its mandate. Currently it consists only of an acting General Inspector supported by a consultant hired by the World Bank. Despite the slow progress with the full implementation of the Law on Inspections, recent surveys carried out by IFC Investment Climate Project in collaboration with the Bank team, have found a reduction in the number of inspection visits to firms and the annual costs of inspections to firms. These changes can be attributed to the application of the new Law on Inspections, which was supported by the Project, namely its articles related to the risk-based principles when selecting firms for inspection. Technical assistance to the GIO is progressing well, including mobilization of consultants to support the GIO in areas such as legal expertise, communications, and risk-based methodology. 7/18/2023 Page 1 of 5 The World Bank Implementation Status & Results Report KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance High High High Macroeconomic Substantial Moderate Moderate Sector Strategies and Policies Substantial Moderate Moderate Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Substantial Substantial Substantial Sustainability Fiduciary Substantial Substantial Substantial Environment and Social Low Low Low Stakeholders Substantial Moderate Moderate Other -- -- -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes Objective 1 IN01295590 ►Share of beneficiaries of the matching grants program that increase their export value relative to firms of similar size in same sector (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 36.00 36.00 15.00 Date 30-Dec-2016 30-Oct-2023 16-May-2023 30-Oct-2023 PIU has provided information about measurement of this indicator for first grants call. Comments: IN01295631 ►Reduction in annual inspection compliance cost per business (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 76.00 15.00 7/18/2023 Page 2 of 5 The World Bank Implementation Status & Results Report KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) Date 30-Dec-2016 29-Sep-2022 16-May-2023 30-Oct-2023 Annual inspection compliance cost per business (including staff time, travel and other costs but not fines) was €220 i reduced to €148.8 in 2021 and €52.6 euros in 2022. The reduction mostly comes from the reduction of number of ins Comments: companies as risk-based methodology is applied as prescribed by the new Law on inspections. Intermediate Results Indicators by Components Component 1: Enhancing Business Environment and Export Readiness IN01295632 ►Number of firms financed through matching grants program (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 163.00 273.00 160.00 Date 30-Dec-2016 29-Sep-2022 16-May-2023 30-Oct-2023 Comment: 153 direct grants’ benefitiaries, including 25 from the first round and 120 indirect benefitiaries Comments: who benefited from trainings delivered by their respective business associations. IN01295633 Number of firms with female owner or manager financed through matching grants program (Number, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 33.00 37.00 20.00 Date 30-Dec-2016 29-Sep-2022 16-May-2023 30-Oct-2023 IN01295634 ►Percentage of beneficiaries who report that the project has established an effective engagement process (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 95.00 95.00 70.00 Date 30-Dec-2016 30-Sep-2022 16-May-2023 30-Oct-2023 In total, 95% of surveied beneficiaries considered the consultations/engagement process as effective. Current value reflects the findings of the beneficiary companies survey conducted in May-June Comments: 2022. A follow up survey has been launched in May 2023 and will inform the next ISR. IN01295635 ►New law on inspection is adopted by the Parliament (text) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value NO YES YES YES Date 30-Dec-2016 29-Sep-2022 16-May-2023 31-Dec-2021 IN01295636 ►Number of inspection visits per firm each year (Number, Custom) 7/18/2023 Page 3 of 5 The World Bank Implementation Status & Results Report KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) Baseline Actual (Previous) Actual (Current) End Target Value 22.00 22.00 1.59 16.00 Date 31-Dec-2015 29-Sep-2022 16-Mar-2023 30-Oct-2023 The Bank and PIU are coordinating with the IFC who has contracted a firm to measure this indicator. The reform has not been fully implemented yet. The surveys conducted confirm 1.59 visits in 2022 and 2.4 in 2021. [EI1] [BQ2] The reform (introduction of e-inspector system) has not been fully implemented yet, but Comments: the number of inspection visits reduced as risk-based methodology is applied as prescribed by the new Law on Inspections IN01295637 ►Number of user survey results about the business inspections system were shared in public (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 3.00 Date 30-Dec-2016 29-Sep-2022 16-May-2023 30-Oct-2023 The 2021 and 2022 surveys were conducted by IFC contractor and the results will be published on the government website. The PIU will conduct survey of 600 companies for first half of 2023 in June/July and Comments: will publish respective report on the MIET and/or IG website. IN01295638 ►Number of inspectorates within government body (Number) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 36.00 30.00 24.00 15.00 Date 31-Dec-2015 29-Sep-2022 24-May-2023 30-Oct-2023 List of inspectorates prescribed by the Law on Inspection as provided by GIO. It includes 29 inspectorates but only 2 reform. This consolidation is not fully implemented yet, pending substantial legal reform and amendments to sectoral will help GIO outline/prepare for this reform and consolidation, but it is not likely to be adopted by the Parliament and Comments: Project end date to reach the target of 15. Performance-Based Conditions Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P152881 IDA-60350 Effective USD 15.27 15.27 0.00 7.42 7.96 48% 7/18/2023 Page 4 of 5 The World Bank Implementation Status & Results Report KOSOVO: COMPETITIVENESS AND EXPORT READINESS PROJECT (P152881) Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P152881 IDA-60350 Effective 18-May-2017 02-Aug-2017 18-May-2018 30-Oct-2022 30-Oct-2023 Cumulative Disbursements Restructuring History Level 2 Approved on 01-Jun-2020 ,Level Approved on 02-Jun-2020 ,Level 2 Approved on 12-Oct-2022 Related Project(s) There are no related projects. 7/18/2023 Page 5 of 5