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)