The World Bank Yemen Desert Locust Response Project (P174170) REPORT NO.: RES58619 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF YEMEN DESERT LOCUST RESPONSE PROJECT APPROVED ON JUNE 17, 2020 TO FOOD AND AGRICULTURE ORGANIZATION (FAO) AGRICULTURE AND FOOD MIDDLE EAST AND NORTH AFRICA Regional Vice President: Ferid Belhaj Country Director: Stephane Guimbert Regional Director: Meskerem Brhane Practice Manager/Manager: Marianne Grosclaude Task Team Leader(s): Artavazd Hakobyan The World Bank Yemen Desert Locust Response Project (P174170) ABBREVIATIONS AND ACRONYMS CFW Cash for Work COVID-19 Coronavirus Disease 2019 DLCC Desert Locust Control Center ESF Environmental and Social Framework FAO Food and Agriculture Organization of the United Nations IDA International Development Association MAI Ministry of Agriculture and Irrigation PDO Project Development Objective TPM Third-party monitoring IP Implementation Progress BASIC DATA The World Bank Yemen Desert Locust Response Project (P174170) Product Information Project ID Financing Instrument P174170 Investment Project Financing Environmental and Social Risk Classification (ESRC) Substantial Approval Date Current Closing Date 17-Jun-2020 29-Dec-2023 Organizations Borrower Responsible Agency Food and Agriculture Organization (FAO) Project Development Objective (PDO) Original PDO The Project Development Objectives are to control the desert locust outbreak, support livelihoods in locust-affected areas and strengthen Yemen’s preparedness for future locust infestations. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-D6710 17-Jun-2020 14-Jul-2020 14-Jul-2020 29-Dec-2023 25.00 24.97 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status The World Bank Yemen Desert Locust Response Project (P174170) 1. This Restructuring Paper seeks the approval to restructure the Yemen Desert Locust Response Project (DLRP). The proposed restructuring consists of an extension of the closing date by six months, from December 29, 2023 to June 29, 2024. This would be the first extension of the closing date of the project. 2. The project was approved on June 17, 2020 and became effective on July 14, 2020. The Project Development Objective and Implementation progress (IP) are rated Moderately Unsatisfactory due to delays in the construction of the Desert Locust Control Centers (DLCC) and incremental risks associated with the deployment of vehicles for the DLCCs financed by the project. Project funds have been fully disbursed to the Implementing Entity – Food and Agriculture Organization (FAO) and are being paid to contractors and implementing partners as project activities are nearing completion and delivery to final beneficiaries. 3. The project development objectives (PDO) are to control the desert locust outbreak, support livelihoods in locust- affected areas and strengthen Yemen’s preparedness for future locust infestations. In the context of Yemen, the expected outcomes of the project are described as follows: (i) a response to the locust infestation outbreak encompassing improved locust surveillance, monitoring, and control activities; (ii) livelihood support focusing on protection and restoration in the locust-affected areas; and (iii) strengthened national preparedness systems including three main elements—establishing a network of Desert Locusts Control Centers, establishing an early response system, and connecting Yemeni systems with regional networks to exchange information and data and improve coordination of the locust response. 4. The project is expected to achieve its objectives through the following components: a. Component 1 - Surveillance and Control Measures, which aims to improve the capacity for surveying and surveillance of breeding and infestation areas and for gathering meteorological data, support locust control activities (spraying), and implement risk mitigation measures for the workers and affected communities. b. Component 2 - Livelihood Protection and Rehabilitation, which includes two types of measures: (i) creation of temporary employment opportunities, and (ii) restoration of lost assets. c. Component 3 – Coordination and Early Warning Preparedness, which aims to strengthen the national capacity for early warning and early response, linking these efforts to regional locust surveillance and control networks thereby enhancing climate resilience. d. Component 4 – Project management, which covers the costs associated with project management, such as implementation support, financial management, procurement, monitoring the project environmental and social aspects, and overall monitoring and evaluation. 5. The main achievement under Component 1 (Surveillance and Control Measures) has been the extensive surveillance and monitoring, which considerably exceeded the project’s target, generating valuable information about locust breeding areas and movements. This information is important for locust monitoring not only in Yemen, but also for the entire region covering North Africa, Middle East and Arabian Peninsula. Cumulatively, under the project 3,298,750 The World Bank Yemen Desert Locust Response Project (P174170) ha have been covered including a total area of 819,360 ha covering the hot spots for desert locust swarms, breeding groups and spreads. 6. Under Component 2 (Livelihood Protection and Rehabilitation), eleven land and water infrastructure sub-projects were completed in four governorates. A total of 5,367 workers were involved with 121,240 person-days of inputs. FAO estimates that the total number of direct beneficiaries, i.e., people who directly benefit from labor or from the improved community assets, is 20,820. As part of the sub-component 2.2, focusing on rehabilitating agricultural and pastoral livelihoods, more than 5,485 affected households were supported with agricultural input packages, such as feeds, seeds, livestock, and beehives. 7. Under Component 3 (Coordination and Early Warning Preparedness), the project has helped establish the desert locust early warning system, which was assessed by FAO to be operational. In addition to monitoring systems and staff capacity building, the system preparedness also requires proper infrastructure and facilities in place, which are supported by the project, but which recorded slow progress as further described below. 8. The Project is in compliance with the Environmental and Social Framework (ESF). The latest financial reports of the project are up-to-date and deemed Satisfactory and there are no overdue financial audits for the project. B. Rationale for Restructuring 9. The rationale for the extension of the closing date by six months is to complete the construction of the Desert Locusts Control Centers (DLCCs) which are critical facilities to achieve the project’s PDO. The proposed extension will also enable the completion of other activities which are important for the sustainability of the project’s achievements (see below). The delays observed with the implementation of those activities stem from project start-up and implementation delays during the COVID-19 pandemic as well as the volatility of Yemen’s conflict-related operating environment. Specifically, and as outlined in FAO’s request letter dated October 17, 2023: a. COVID-19 related restrictions significantly slowed down the project start, delaying the mobilization of project staff, and movement of goods. Field activities were delayed for almost two years until the restrictions were lifted in early 2022. b. There were delays in implementation due to difficulties in obtaining clearances from the Supreme Council of Management and Coordination of Humanitarian Affairs (SCMCHA) for the implementation of project activities in the North. c. Negotiations with Social Fund for Development (SFD) on the technical and operational aspects under the Operational Partnership Agreement (OPA) took longer than expected. The OPA was signed in late February 2022 and the actual implementation of Component 2 activities started in the summer of 2022. d. Identification and launch of construction works of the DLCC was delayed due to difficulties related to the identification of government-owned sites, challenges associated with obtaining land permits and lengthy negotiations with the authorities on the types of constructions, technical approvals and tendering. All construction works started in 2023. The World Bank Yemen Desert Locust Response Project (P174170) e. There were difficulties associated with the intended use of a limited number of vehicles procured under the project. 10. The Task Team confirms that the requirements of the World Bank Policy on Investment Project Financing have been met. Namely: (i) the PDO remains achievable; (ii) the performance of the Recipient (FAO) remains moderately satisfactory; (iii) the World Bank and the Recipient (FAO) have agreed on actions to be undertaken to complete the project on time (an action plan has been prepared and agreed upon); and (iv) the Project is not subject to suspension of disbursements. II. DESCRIPTION OF PROPOSED CHANGES C. Description 11. Closing date extension. The proposed restructuring would extend the project closing date from December 29, 2023, to June 29, 2024. The extension of the closing date would allow completion of the construction and proper handover of DLCCs under Component 3. As an added benefit, it would allow to extend the project-financed desert locust monitoring and surveillance activities, generating locally and regionally important information for desert locust outbreaks under Component 1. It would also allow for continued monitoring of the intended use of vehicles financed by the project. Lastly, the proposed extension would allow for the implementation of additional livelihood activities to support affected communities in four governorates. It is expected that the project IP and DO indicators will improve as a result of the proposed restructuring and implementation of the Action Plan agreed between the World Bank and FAO. 12. Component 1. An additional area of locust affected land will be surveyed during the project closing date extension period with benefits both for Yemen and for the broader sub-region. Additional training of government staff in charge of locus control and monitoring, thereby increasing the sustainability of project results. 13. The extension of the closing date would also allow to strengthen the monitoring of the intended use of vehicles provided under Component 1. The project financed the delivery of 62 field vehicles, meeting the quality, standard specifications, and quantity specified in the project documents. Third-party monitoring (TPM) inspections of all vehicles have been conducted and found that only 12 vehicles were registered and used in the North; and while all vehicles were registered in the South, only 2 of them were used. As part of the action plan, the World Bank and FAO have agreed that monthly TPM checks will be conducted to verify the intended use of vehicles. In addition, GIS tracking devices have been installed on all vehicles, and a vehicle use log has been adopted both in the North and South to record movements of vehicles and their use. During the extension this monitoring will continue, and FAO will engage in continuous dialogue with the authorities for proper registration, maintenance and intended use of the vehicles. 14. Component 2. As part of the action plan, the World Bank and FAO have agreed that some additional 3,000 affected vulnerable households would be supported with agricultural input packages, which would include agricultural input The World Bank Yemen Desert Locust Response Project (P174170) kits (seeds, seedlings, fertilizers, and training). This would be achieved utilizing project savings associated with the cancellation of further vehicles procurement. 15. Component 3. As part of the action plan, the World Bank and FAO agreed that more time is required to complete the civil works for at least three out of the five DLCC sites. The extension of the closing date would allow completing the construction, delivering the required furniture and equipment, and handing over the sites to the relevant desert locust control authorities. In addition, the extension would allow the necessary follow-up with the contractors during the Defect Liability Period after the completion of works. Specifically, out of 5 DLCCs in construction, only two (Shabwah and Seyoun) will be completed by end of December 2023. The three remaining DLCCs will require additional time as described in Table 1 below: TABLE 1. ACTION PLAN FOR COMPLETING DLCC CONSTRUCTION. Action Expected Monitoring Date to be Responsible FAO Result Indicator Completed Unit Aden DLCC Fully percent 31-Mar-24 FAO DLRP team 1. Completing the finishing works in the operational completion of Administration Building. This includes the Locust Center pending works masonry works, plastering, painting, tiling and electrical installation. 2. Completing the remaining finishing works in the Training Center, warehouse, and the workshop. Sana’a DLCC Fully percent 28-Feb-24 FAO DLRP team Completing the finishing works in the Training operational completion of Centre. This includes installation of marble Locust Center pending works tiles for the floor, installation of doors and windows, painting, electrical installations. Al-Hodeida DLCC Fully percent 31-Jan-24 FAO DLRP team Finishing up minor activities in the second operational completion of floor of Administration Building such locust center pending works electrical installations, tiling, painting works installation of windows and doors 16. The project implementation arrangements and project management will remain the same, and FAO will remain the implementing entity of the project. Other than the extension of the project closing date, the proposed Level 2 Restructuring does not entail any changes in allocation of the Grant amounts, scope or nature of project objective(s) or activities, implementation arrangements, or any other amendments to the Grant Agreements. There are also no changes to the project’s ESF instruments and risks. ES NOTE TABLE The World Bank Yemen Desert Locust Response Project (P174170) III. SUMMARY OF CHANGES Changed Not Changed Loan Closing Date(s) ✔ Implementation Schedule ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_LOANCLOSING_TABLE The World Bank Yemen Desert Locust Response Project (P174170) LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IDA-D6710 Effective 29-Dec-2023 29-Jun-2024 29-Oct-2024 . The World Bank Yemen Desert Locust Response Project (P174170)