FOR OFFICIAL USE ONLY Report No: ICR00006185 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT IMPLEMENTATION COMPLETION AND RESULTS REPORT Loan Number 8905-CN ON A LOAN IN THE AMOUNT OF US$200 MILLION TO THE PEOPLE’S REPUBLIC OF CHINA FOR THE Anhui Rural Road Resilience Program for Results December 21, 2023 Transport Global Practice East Asia And Pacific Region CURRENCY EQUIVALENTS Currency Unit = Chinese Yuan (CNY) CNY 7.25 = US$1 FISCAL YEAR January 1 - December 31 Regional Vice President: Manuela V. Ferro Country Director: Mara K. Warwick Regional Director: Sudeshna Ghosh Banerjee Practice Manager: Benedict L. J. Eijbergen Task Team Leader(s): Xiaoke Zhai, Anita Shrestha ICR Main Contributor: Khaliun Bat-Orig ABBREVIATIONS AND ACRONYMS APFYCTP Five-Year Comprehensive Transport Plan for Anhui Province APG Anhui Provincial Government CNY Chinese Yuan CO-TTL Co-Task Team Leader CPF Country Partnership Framework CTB County Transport Bureau DLI Disbursement Linked Indicator DLR Disbursement Linked Results EMP Environmental Management Plans ESSA Environmental And Social Systems Assessment FS Feasibility Study FY Fiscal Year FYP Five Year Plan GOC Government Of China ICR Implementation Completion Report IPF Investment Project Financing ISR Implementation Status and Results Report IVA Independent Verification Agent KM Kilometer M&E Monitoring And Evaluation NVRP Natural Village Road Program PAD Program Appraisal Document PAP Program Action Plan PDO Program Development Objective PFORR Program For Results PMO Program Management Office RMP Road Maintenance Programs SRP Safe Road Program STP Smooth Traffic Program TTL Task Team Lead PQI Pavement Quality Index TABLE OF CONTENTS DATA SHEET ........................................................................................................................... I I. PROGRAM CONTEXT AND DEVELOPMENT OBJECTIVES .................................................... 1 A. CONTEXT AT APPRAISAL AND THEORY OF CHANGE .................................................................1 B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) .......................................6 II. OUTCOME ...................................................................................................................... 7 A. RELEVANCE ............................................................................................................................7 B. ACHIEVEMENT OF PDOs (EFFICACY) ........................................................................................9 C. JUSTIFICATION OF OVERALL OUTCOME RATING .................................................................... 11 D. OTHER OUTCOMES AND IMPACTS (IF ANY) ........................................................................... 12 III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME ................................ 13 A. KEY FACTORS DURING PREPARATION ................................................................................... 13 B. KEY FACTORS DURING IMPLEMENTATION ............................................................................. 14 IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME .. 15 A. QUALITY OF MONITORING AND EVALUATION ....................................................................... 15 B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE ..................................................... 17 C. BANK PERFORMANCE ........................................................................................................... 18 D. RISK TO DEVELOPMENT OUTCOME ....................................................................................... 19 V. LESSONS AND RECOMMENDATIONS ............................................................................. 19 ANNEX 1. RESULTS FRAMEWORK, DISBURSEMENT LINKED INDICATORS, AND PROGRAM ACTION PLAN ...................................................................................................................... 22 ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION ......................... 34 ANNEX 3. PROGRAM EXPENDITURE SUMMARY ................................................................... 36 ANNEX 4. BORROWER’S COMMENTS ................................................................................... 37 ANNEX 5. SUPPORTING DOCUMENTS (IF ANY) ..................................................................... 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) DATA SHEET BASIC INFORMATION Product Information Program ID Program Name Financing Instrument Anhui Rural Road Resilience Program for P158733 Program-for-Results Financing Results Country IPF Component China No Organizations Borrower Implementing Agency Anhui Highway Management and Service Center, Anhui People's Republic of China Provincial Transport Department Program Development Objective (PDO) Original PDO Objective to be Determined. The Program Development Objective (PDO) is to improve the rural road network connectivity, safety and quality in selected counties in Anhui Province. PDO as stated in the legal agreement The Program Development Objective (PDO) is to improve the rural road network connectivity, safety and quality in selected counties in Anhui Province. i The World Bank Anhui Rural Road Resilience Program for Results (P158733) FINANCING FINANCE_TBL Original Amount (US$) Revised Amount (US$) Actual Disbursed (US$) World Bank Administered Financing 200,000,000 200,000,000 200,000,000 IBRD-89050 Total 200,000,000 200,000,000 200,000,000 Non-World Bank Administered Financing Borrower/Recipient 77,777,778 345,000,000 390,746,442 Total 77,777,778 345,000,000 390,746,442 Total Program Cost 277,777,778 545,000,000 590,746,442 KEY DATES Program Approval Effectiveness MTR Review Original Closing Actual Closing P158733 27-Sep-2018 26-Feb-2019 26-Oct-2021 30-Jun-2023 30-Jun-2023 RESTRUCTURING AND/OR ADDITIONAL FINANCING Date(s) Amount Disbursed (US$M) Key Revisions KEY RATINGS Outcome Bank Performance M&E Quality Highly Satisfactory Highly Satisfactory Substantial RATINGS OF PROGRAM PERFORMANCE IN ISRs Actual No. Date ISR Archived DO Rating IP Rating Disbursements (US$M) 01 03-Apr-2019 Satisfactory Moderately Satisfactory 0 02 05-Feb-2020 Satisfactory Moderately Satisfactory 50.00 03 17-Sep-2020 Satisfactory Moderately Satisfactory 50.00 ii The World Bank Anhui Rural Road Resilience Program for Results (P158733) 04 30-Mar-2021 Satisfactory Moderately Satisfactory 50.00 05 27-Oct-2021 Satisfactory Moderately Satisfactory 100.00 06 21-Jan-2022 Satisfactory Satisfactory 100.00 07 13-Oct-2022 Satisfactory Satisfactory 160.00 08 09-Jun-2023 Highly Satisfactory Highly Satisfactory 200.00 SECTORS AND THEMES Sectors Major Sector/Sector (%) Transportation 100 Public Administration - Transportation 5 Rural and Inter-Urban Roads 95 Themes Major Theme/ Theme (Level 2)/ Theme (Level 3) (%) Urban and Rural Development 100 Rural Development 100 Rural Infrastructure and service delivery 100 Geospatial Services 5 Road Safety 100 Disaster Risk Management 100 Disaster Risk Reduction 100 Environment and Natural Resource Management 25 Climate change 25 Adaptation 25 ADM STAFF Role At Approval At ICR Regional Vice President: Victoria Kwakwa Manuela V. Ferro Country Director: Bert Hofman Mara K. Warwick iii The World Bank Anhui Rural Road Resilience Program for Results (P158733) Director: Jose Luis Irigoyen Sudeshna Ghosh Banerjee Practice Manager: Binyam Reja Benedictus Eijbergen Task Team Leader(s): Jacques Bure Xiaoke Zhai, Anita Shrestha ICR Contributing Author: Khaliun Bat Orig iv The World Bank Anhui Rural Road Resilience Program for Results (P158733) I. PROGRAM CONTEXT AND DEVELOPMENT OBJECTIVES A. CONTEXT AT APPRAISAL AND THEORY OF CHANGE Context 1. China had achieved remarkable economic growth and development since the 1980s, reaching the status of an upper-middle income country as of 2010. During this period, China experienced an average annual Gross Domestic Product (GDP) growth of around 10 percent, peaking at 14.2 percent in 2007. This growth was driven by capital investment, increased productivity, and exports. Over 850 million people were lifted out of poverty in China, contributing to nearly three-quarters of the global reduction in extreme poverty1. Large-scale investments in the upgrade of critical infrastructure also played a significant role in rapid economic growth and poverty reduction. 2. China substantially expanded its transport infrastructure, including rural roads, between 2000 and 2010. During this period alone, China invested in the construction of over one million kilometers of rural roads in response to growing urbanization and rapid motorization. By the end of 2015, China had about four million kilometers of rural roads, providing access to nearly 98 percent of town/townships with paved road network and to 94 percent of administrative villages. 3. The Government of China (GoC) recognized sustainable infrastructure development as a top priority in its 13th Five-Year Plan (FYP). However, the development of human capital to efficiently plan and manage financial and natural resources for road construction and maintenance did not keep pace with the high rate of infrastructure spending. Soft infrastructure was not at par with hard infrastructure development. Soft infrastructure lagged behind hard infrastructure development, leading to issues such as inadequate operations and maintenance plans, insufficient safety measures, and vulnerability to climate hazards. Innovation and new techniques, along with an improved approach to maintenance and resilience, were called for to address these challenges while promoting green growth. Many of the rural roads connecting townships and villages were constructed to low technical standards. In addition, inefficiencies in planning led to fragmentation in infrastructure coverage, as well as overdesign of infrastructure facilities. Smaller (natural) villages did not have sufficient access to paved roads, resulting in wider economic access disparities between rural and urban residents. The 13th Five-Year Plan (FYP) by the Ministry of Transport called for connecting all towns and administrative villages with paved roads, widening rural roads, improving safety features on high-risk rural roads, and rehabilitating damaged rural bridges. 4. In Anhui Province, in line with the national trend, the rural road network expanded significantly but faced challenges such as vulnerability to climate hazards, poor road safety, and deteriorating conditions. From 2000 to 2015, the rural road network in Anhui grew five-fold, from 34,000 kilometers to 172,000 kilometers. However, this expansion occurred without sufficient consideration for quality, safety, resilience, and an effective operations and maintenance framework. As of 2015, a significant portion of the road network was in fair to poor condition due to lack of maintenance and high vulnerability to climate hazards. Close to 10 percent of rural roads were sub-standard, falling below Class III standards, and access to smaller, economically disadvantaged natural villages remained insufficient. Page 1 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) 5. The 13th Five-Year Comprehensive Transport Plan for Anhui Province (APFYCTP) aimed to enhance rural road infrastructure and the level of transport service through several programs . Objectives of the 13th APFYCTP included improving rural road transport, enhancing the connectivity and accessibility of rural roads, improving road safety, increasing the reliability and resilience of the rural road network to natural disasters, extending rural road service life through maintenance, and strengthening capacities through institutional reforms, improved program implementation mechanisms, and policy development. Achieving these objectives presented significant challenges to county administrations, necessitating additional technical and administrative support. 6. The 13th APFYCTP built on national and provincial programs, some initiated during the 12th FYP period. It included programs such as the Smooth Traffic Program (STP) to upgrade and rehabilitate rural roads, concluding in 2018, followed by the Natural Village Road Program (NVRP) implemented from 2019 to 2022 to strengthen the rural road network. Other programs encompassed the Safe Road Program (SRP) to enhance the safety of township and higher-level roads by 2020, Road Maintenance Programs (RMP) to achieve 100 percent coverage on rural road maintenance, Damaged Bridge Program (BIP) to eliminate hazardous bridges on rural roads, and institutional capacity building. Additionally, Anhui Province introduced the "Four-Excellence" initiative focusing on construction, management, maintenance, and operation of rural roads, implementing a performance metrics system to enhance rural road network management capacity. Rationale for World Bank involvement 7. The PforR was envisioned to help Anhui Province better manage its rural road network, and the design of the PforR had the potential for replication across China to enhance the management of rural road assets. This marks the first World Bank-financed Program for Results (PforR) in the transport sector in China. The World Bank aimed to assist the Anhui Government in developing innovative approaches for improved maintenance, resilience, safety, and environmental friendliness of roads. In addition to the PforR objectives, the World Bank envisioned introducing the following innovations to Anhui Province through this operation: i) innovations in institutional reform to implement performance management and accountability for rural road agencies at the county level, ii) innovations in monitoring and evaluation using new apps and web-based tools, iii) innovations in bridge reconstruction and maintenance, iv) innovations in road management and operation, v) replicability of PforR experience in China and worldwide. These innovations were outlined in the Program Action Plan (PAP) as value-added aspects of the PforR through 13 specific actions. 8. The PforR operation aligned with the World Bank Group’s China Country Partnership Framework (CPF) for the period FY13–FY16, emphasizing infrastructure and rural-urban integration to support the government’s efforts in addressing income disparities, enhancing livelihoods, and raising living standards for the rural population. The Country Partnership Strategy (CPS) Strategic Theme #2 “Promoting More Inclusive Development” specifically called for increasing rural residents’ access to employment, education, healthcare, and markets. Two CPS outcomes closely aligned with the circumstances of the local project context: (i) Outcome 2.3: Enhancing Opportunities in Rural Areas and Small Towns; and (ii) Outcome 2.4: Improving Transport Connectivity for More Balanced Regional Development. Both the CPS and government plans converged around approaches consistent with the Bank's Twin Goals of eliminating extreme poverty and promoting shared prosperity. Page 2 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Theory of Change (Results Chain) 9. The program was prepared before a Theory of Change became a compulsory element in the Program Appraisal Document (PAD). Accordingly, the results chain has been formulated by the Implementation Completion Report (ICR) author based on their interpretation of the program's theory of change at the appraisal stage, as shown in Figure 1 below. Figure 1. The Program for Results Theory of Change Critical Assumptions: a. Resilience measures are adopted in road design and executed during civil works. b. Road safety audit is carried out, and appropriate road safety measures are identified, adopted, and implemented. c. Funding is allocated and institutional set up is available to carry out the road maintenance. d. Anhui Provincial Government issues a legal mandate to institutionalize the 4-Excellence program covering three criteria “construction, management, and maintenance”. Rationale for PforR Support, and Program Scope and Boundaries 10. The PforR instrument was chosen for Anhui Rural Road Resilience operations to enable Anhui province to benefit from the World Bank in building more sustainable rural road management practices while leveraging its own existing institutional set-up. Anhui province had gained sufficient experience from investment project financing (IPF) projects and had developed project management systems that could meet the PforR requirements. The PforR instrument would enable Anhui province to: i) focus on institutional capacity to manage rural roads with longer-term, more sustainable impacts than a standard investment lending operation, ii) provide more autonomy to the province by using the PforR disbursement-linked indicator (DLI) mechanism, iii) utilize smaller borrowing while leveraging existing systems already in Page 3 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) place to achieve development outcomes through a larger set of policies, and iv) provide the province with more flexibility to adjust implementation timing and activities as the need arises. 11. The PforR was designed to support Anhui Province in achieving the objectives laid out in the 13 th APFYCTP. The main objectives of the 13th APFYCTP are mentioned in Paragraph 5 above. The 13th APFYCTP comprised five programs to achieve these above-mentioned objectives, which are mentioned below in Figure 3. These provincial programs were set to reach all 103 counties in the province. A portion of the 13th APFYCTP was to be financed through the provincial and national government, and the remaining was planned to be covered by the county governments. 12. The PforR supported all five provincial programs under the 13 th APFYCTP and provided financing to 10 selected county governments for the implementation of government programs. The PforR design limited the number of direct beneficiary counties and selected 10 counties to allow successful practices and lessons learned to be gradually rolled out to the rest of Anhui province. These target 10 counties were selected against four criteria: i) rural roads are seriously damaged, ii) the impact of rural accessibility is larger than average, iii) the economic impact of having an enhanced rural road network would be larger than average, and iv) road safety is a serious issue in the counties. In addition, expenditure framework assessments of the counties were carried out to ensure the PforR did not impose any fiscal burden, and each county could affirm fiscal sustainability and funding predictability, particularly for the operation and maintenance of rural roads. In Figure 2 below, please find the comparison of the APFYCTP and the PforR scope at PforR preparation. Figure 2. Comparison of the Government program and the PforR program 13. At appraisal, Anhui province had designed a three-stage plan for the roll-out of the lessons learned from PforR to the rest of the province: During 2018 and 2020, the Program Management Office (PMO) would identify and prepare institutionalization of successful experiences in terms of construction, management, maintenance, and operation of rural roads. During the last year of the PforR, the results of the PforR would be disseminated to additional 20 counties. And a comprehensive dissemination to all counties in Anhui would start one year later in 2022, based on experience of the second phase, leading to a sustainable development of rural roads construction and management in Anhui Province. Program Development Objectives (PDOs) 14. The Program Development Objective (PDO) is to improve the rural road network connectivity, safety, quality, and its management in the participating counties of Anhui Province. Page 4 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Key Expected Outcomes and Outcome Indicators 15. The PforR was designed to achieve three key development objectives in three Results areas: Result Area 1: Improve rural road connectivity and safety. Program: Smooth Traffic Program and Safe Roads Program PDO: County and township roads in excellent and good condition Result Area 2: Maintain good quality rural roads. Program: Bridge Improvement Program and Road Maintenance Program PDO: Rural roads maintenance coverage rate Result Area 3: Strengthen institutional capacity. Program: Institutional Capacity Building PDO: Rural road network management capacity improved through institutional reform For more details on the indicators and the Results Framework, please refer to Annex 1 of the ICR. Program Results Areas and DLIs 16. The PforR covers three result areas and has four associated Disbursement Linked Indicators (DLIs). The DLIs were designed to provide financial incentives to improve both infrastructure and institutions, with an emphasis on resilience and safety. The DLIs were to be assessed by an Independent Verification Agent (IVA). The mapping of the relationship between result areas, relevant provincial programs, and their objectives, PDO indicators and DLIs is presented below in Figure 3. Figure 3. Mapping of results areas and PforR DLIs to the government programs PforR Result Associated Government Objectives PDO DLI Areas Program Result Area 1: 1. a Smooth Traffic 1.a & 1.b) STP to Improve rural Program (STP) (2016- upgrade and rehabilitate road 2018) rural roads (to end 2018) connectivity and and to be followed by safety 1. b Natural Village the NVRP to strengthen Road Program (NVRP) the rural road network continuation of the (2019 – 2022). PDO Indicator #1: DLI 1: Rural roads Smooth Traffic Program County and township improved with resilience (STP), 2019-2022 2) SRP to improve safety roads in excellent and and safety features (km) of township and higher- good condition 2. Safe Road Program level roads and enhance (percent) (SRP) the capacity of road Page 5 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) safety governance by 2020; Result Area 2: 3. Damaged Bridge 3) the BIP to eliminate DLI 2.1: Bridges Maintain good Improvement Program hazardous bridges on reinforced, demolished, quality roads (BIP) rural roads. and/or reconstructed with resilience and safety 4. Road Maintenance PDO Indicator #2: Rural features (linear meter) Program (RMP) roads maintenance coverage rate (percent) DLI 2.2: Rural roads maintained with resilience 4) the RMP to reach 100 and safety features percent coverage on (percent) rural road maintenance; Result Area 3: 5. Institutional capacity 5) Institutional capacity PDO Indicator #3: Rural DLI 3: Institutional Strengthen building program building through road network improvements in the rural institutional introduction of the 4- management capacity roads sector at the county capacity excellence program. improved through level (number of counties) institutional reform along the following three (number) criteria: i) excellence in construction, ii) excellence in management, iii) excellence in maintenance. B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) 17. Not applicable. Revised PDOs Outcome Targets, Result Areas, and Disbursement-Linked Indicators (DLIs) 18. The PforR did not go through restructuring, therefore, no changes to the PDO, outcomes, targets, result areas and DLIs have been made. Other Changes 19. The PforR did not go through restructuring, therefore, no changes to the PDO, outcomes, targets, result areas and DLIs have been made. Rationale for Changes and their Implication for the Original Theory of Change 20. The PforR did not go through restructuring, therefore, no changes to the theory of change were made. Page 6 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) II. OUTCOME A. RELEVANCE Relevance of PDO 21. Midway through the implementation of the PforR, the Government of China (GoC) introduced its 14 th Five-Year Plan (2021-2025) for National Economic and Social Development and Long-Range Objectives for 2035. Building on the achievements of the 13th FYP, the 14th FYP focused on the sustainability of growth and quality of life. Within this framework, China aimed to foster green, smart, sustainable, and high-quality transport development. The GoC set a goal to complete a convenient, cost-effective, green, smart, reliable, and modern national comprehensive transportation network by 2035. The 14th Five-Year Plan also renewed the GoC’s efforts to close the urban-rural divide through the creation of employment and investment opportunities in rural areas. 22. The PforR objectives remained in alignment with Anhui’s Provincial 14 th Five-Year Plan for the Development of Transportation (14th APFYCTP). The 14th APFYCTP included continued efforts in the construction and expansion of rural roads with the overarching goal of improved connectivity and access for rural residents. Anhui province planned to continue its agenda with the upgrade of 3,000 km of county and township roads, construction/upgrade of 3,000 km of roads connecting villages, construction/upgrade of 14,000 km of roads connecting natural villages, and improvement of road safety, bridges, and maintenance of roads under the 14th APFYCTP. 23. The objectives of the PforR remained highly relevant to the China Country Partnership Framework (CPF) for FY2020–2025. The CPF focuses on addressing "gaps in policies and institutions," with a particular emphasis on China achieving regional and global public goods. Capacity strengthening for road management stayed in line with the CPF objective of "promoting low-carbon transport and cities" that aims to address the insufficient attention of local governments to asset management and excessive focus on construction. Improved asset management and enhanced road conditions from the PforR would result in reduced carbon emissions from motor vehicles. The objective of improving rural road connectivity contributed to the CPF engagement area of "sharing the benefits of growth" through improved access for residents to employment and education opportunities and healthcare facilities. Moreover, the PforR's intended value-add of showcasing innovations of a decentralized program for rural road development based on PforR principles that can be shared not only with other counties and provinces in China but throughout the world contributes to the CPF's cross-cutting theme of contributing to global knowledge and development. 24. The relevance of objectives is rated as high, where full alignment between the program objectives, CPF objectives, and the provincial development objectives remained at the program closing. Relevance of DLIs 25. The four DLIs designed as the basis for disbursing World Bank funds under the PforR operation were all clearly defined and measurable, each with clear protocol and methodology for monitoring and verification. The description and verification requirements for road safety and climate resilience for DLI 1, “Rural roads improved with resilience and safety features,” DLI 2.1, “Bridges reinforced, demolished, and reconstructed with resilience and safety features,” and DLI 2.2, “Rural roads maintained with resilience and safety measures,” were well articulated in the PforR document. Page 7 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Regarding road safety, the program design included ChinaRAP tool to carry out a detailed road safety assessment on sampled road sections in Anhui at the beginning of the PforR implementation, through a Bank-Executed Trust Fund2. Based on the findings and recommendations of the ChinaRAP assessment, a catalogue of road safety countermeasures was prepared for the PforR. A clear set of safety features, based on this catalogue in addition to relevant national and provincial level road safety standards, was defined and used to assess the achievement of the safety improvement aspect of the DLIs. Regarding climate resilience, the PforR was designed based on a climate resilience assessment, identifying extreme temperatures, increased precipitation, and increased flooding as the main climate stressors. Specific construction standards, such as the use of high modulus asphalt mixture material for better performance in high- temperature conditions, improvement of the drainage system and retaining wall to reduce flooding impact and landslides, and asphalt overlay to reduce freezing and icing damages in mountainous areas, were required from road works to meet the improved resilience aspect of the DLI. These road safety and climate resilience requirements were appropriately reflected in the DLI description and in procedures for verification3. 26. DLI 3, “Number of counties that have incorporated the construction, management, and maintenance excellence criteria into performance assessment conducted by the corresponding municipality” had clearly defined objectives (i.e., criteria) for counties to meet, which were required to be incorporated in their evaluation and reporting mechanisms. These are three of the four criteria4 envisioned under the government initiated “Four-Excellence” program. Counties were required to meet five sub-criteria under construction, four sub-criteria under management, and three sub-criteria under maintenance aspects of rural road which were described in the DLI Verification Protocol Table of the PAD. Achievement of these sub-criteria would satisfy the implementation of the “Four Excellence” program aspect of the PforR. This is consistent with the objectives and programs under the 13th APFYCTP and provided sufficient incentive for improving institutional performance and results. 27. The DLIs and the PDO indicators in the results framework were well integrated and showed a clear linkage. The DLIs for the PforR provided a good basis as intermediate outcomes that would lead to the achievement of program development objectives. For example, DLIs 1, 2.1, 2.2 were critical actions that would lead to the achievement of target county and township roads in excellent and good condition (PDO 1) and target rural roads maintenance coverage rate (PDO 2), and DLI 3 acted as a critical action leading to improved rural road network management capacity (PDO 3). 28. The Program DLIs provided efficient triggers for improving institutional performance and achieving the envisioned results from the PforR. DLIs 1, 2.1 and 2.2 called for improved resilience and safety in rural road improvement and maintenance, bridge rehabilitation, and road asset management practices; and DLI 3 called for improved asset management practices. These DLIs were feasible enough to achieve during the implementation period of the PforR operation and funds allocated to the PforR were sufficient. Also, the design of the DLIs were appropriate enough to incentivize county transport bureaus to transition its management of road assets to a proactive, risk-based, and sustainable approach, leading to the achievement of the Program objectives. 29. The relevance of DLIs is rated as high, where there is full alignment between the DLIs and the PDOs, and no shortcomings in quality elements of DLI designs. 2 Global Road Safety Facility (GRSF) funded the TA activity to carry out ChinaRAP assessment during Program preparation. 3 Procedures for verifications included application of road safety features, surface thickness, drainage, and retaining wall placements and their corresponding standards. 4 The remaining criteria which were not implemented under the PforR is “operation” of rural roads criteria. Page 8 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Rating of Overall Relevance 30. Based on high relevance of objectives and DLIs, the rating of overall relevance is high. B. ACHIEVEMENT OF PDOs (EFFICACY) Assessment of Achievement of Each Objective or Outcome 31. The efficacy of this PforR is evaluated based on the extent to which the original Program development objectives of improving rural road network connectivity, safety, quality, and management have been achieved. The original program development objective indicators include: i) county and township roads in excellent and good condition, ii) rural roads maintenance coverage rate, and iii) rural road network management capacity improved through institutional reform, corresponding to the three Result Areas of the PforR. All three PDO indicators either met or surpassed the target values by the PforR’s closing date. 32. PforR activities exceeded the target for PDO indicator 5 “county and township roads in excellent and good condition” which intended to measure the improved connectivity, safety, and quality of roads aspects of the PDO. The 10 participating counties cumulatively improved 2,847 km of rural roads under the STP and NVRP; treated 3,004 km of road with roads safety features; and maintained between 15,000 km to 27,000 kilometers of rural roads annually under the RMP. By the PforR’s conclusion, 83 percent of the county and township roads in these 10 Anhui counties were in excellent and good condition based on its Pavement Quality Index (PQI) measurement, surpassing the original PDO target of 75 percent and representing a 23 percent increase from the baseline at the PforR’s outset. These improved roads provide safe and resilient connectivity to 11 million residents in the 10 counties. The associated DLI “Rural roads improved with resilience and safety features (km)” exceeded its target of 5,014 km road improvement under STP, NVRP, SRP with an actual achievement of 5,851 km. 33. Although not measured as a stand-alone PDO indicator, the road safety star ratings of target county roads had exhibited extraordinary improvement based on ChinaRAP assessment6. Initially, two counties, Si and Hanshan, were sampled as a baseline, where only 38 percent of the surveyed roads achieved a star rating of three or above for pedestrian safety 7 . After program implementation, 100 percent of the roads were rated three stars or above for pedestrian and non-motorized transport safety, and over 98 percent for motor vehicles and motorcycles. The ChinaRAP assessment and recommendations formed the basis for a catalogue of road safety design features disseminated to all counties in Anhui during the PforR. The results from assessments in all 10 participating counties were consistent with the achievements in Si and Hanshan. 34. PforR activities fully achieved the target for PDO 8 indicator “rural roads maintenance coverage rate” which measures the improved road quality and management aspects of the PDO. As mentioned in the previous paragraph, Anhui Province routinely maintained between 15,000 km to 27,000 km of rural roads annually between 2018 and 2022 5 This indicator is linked to DLI #1 “Rural Roads improved with resilience and safety features (km)” 6 Sampling of 103km road stretch done before and after Program implementation by ChinaRAP. The activity was funded by a World Bank Trust Fund. 7 66 percent for motor vehicles, 70 percent for motorcycles, and 85 percent for non-motorized transport. 8 This indicator is linked to DLI #2.1 and #2.2 “Bridges reinforced, demolished, and or reconstructed with resilience and safety features” and “Rural roads maintained with resilience and safety features”. Page 9 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) under the RMP, totaling 79,230 km over the PforR's lifetime. Additionally, the province reconstructed 9,728 meters of endangered bridges. By 2020, 100 percent of rural roads were routinely maintained across the participating 10 counties, dropping slightly to 98 percent in 2021 and returning to 100 percent in 2022. The target rate of 98 percent rural roads maintenance rate was successfully achieved. The associated DLIs "Bridges reinforced, demolished, and/or reconstructed with resilience and safety features" and "Rural roads maintained with resilience and safety features" exceeded their target of 8,899 linear meter bridges and approximately 22,360 km of road to be routinely maintained. 35. PforR activities fully achieved the target for PDO9 indicator “rural road network management capacity improved through institutional reform” which measures the improved management aspect of the program development objectives. Within a year of PforR implementation in 2019, all 10 participating counties had established and enforced10 an evaluation mechanism to assess rural road sector performance across three dimensions: i) excellence in construction, ii) excellence in management, and iii) excellence in maintenance, thereby achieving the target. The introduction of the "Four-Excellence" program enabled municipal governments to hold county governments accountable for quality construction, development of adequate capacity for asset management operations, timely implementation of routine and periodic maintenance, and operation of rural roads assets. The "Four-Excellence" program was then rolled out to all 103 counties in Anhui, incorporating lessons learned from the experience of the 10 pilot counties. The Ministry of Transport (MoT) recognized three municipalities (Hefei, Lu’An, and Xuancheng) and 26 counties as national demonstration counties for the "Four-Excellence," with five of these counties participating in the PforR. All 10 participating counties were listed by Anhui province as provincial demonstrations of the "Four-Excellence" program implementation. 36. In addition to achieving PDOs, the Program successfully delivered the value-adds associated with the PforR instrument, as planned and monitored through the PAP. Identified inadequacies and gaps from technical, fiduciary, and safeguard assessments led to the agreement on 13 actions covering six themes of resilience, green roads, road safety, planning and implementation capacity, safeguards, and fiduciary capacity during Program preparation. These actions, listed in the PAP, are key value-adds of the Program designed to improve rural road management systems and guide the Program Management Office (PMO) in effectively achieving the PDO. By the end of the program, all 13 actions had been satisfactorily fulfilled. These actions showed good potential for roll-out to the remaining counties in Anhui, and several, such as the preparation of a summary of resilience improvement technologies, a catalogue of efficient, low- impact green activities for maintenance and construction, a typology of road safety design features, and maintenance of fixed asset registration, have already been disseminated to other counties for adoption. 37. Furthermore, the Program successfully delivered the innovations envisioned to be brought through the PforR in Anhui. Although the PforR financing constitutes a small portion of the total financing needed to implement five provincial programs in Anhui, the Program aimed to demonstrate and stimulate innovations in the provincial program of which the PforR was a part. Regarding innovations in institutional reform for performance management and accountability, the "Four-Excellence" program was successfully piloted in the participating 10 counties and further rolled out to the rest of the province. While the "Four-Excellence" program was a national initiative conceptualized in 2014, Anhui Province had not successfully implemented it across its counties. Based on an extensive technical appraisal carried 9 This indicator is linked to DLI #3 “Number of counties that have incorporated construction, management, and maintenance excellence criteria into annual performance assessment conducted by corresponding municipality.” 10 Through regulations that have been adopted at jurisdiction levels Page 10 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) out jointly by the World Bank and Anhui Province during program preparation, a slightly simplified version of the "Four- Excellence" program focusing only on three out of the four target areas was agreed to be piloted. This gradual institutionalization under the PforR proved successful, enabling Anhui Province to roll it out province wide. Regarding innovations in bridge and road construction and maintenance, participating counties were encouraged to build bridges using greener technologies and materials and incorporate specific design features for improved climate resilience and road safety. The technical parameters set out in the Independent Verification Agent (IVA) verification process were much higher than domestic requirements on these aspects. In some cases, safety engineering requirements were not enforced in Anhui and were not implemented, even though the marginal increase related to safety engineering costs is not substantial compared to the construction cost. Therefore, compared to non-participating counties, bridges were built using greener technologies and often with recycled materials, featuring more resilient and safer designs. Moreover, Anhui province introduced ChinaRAP in rural roads safety assessment and created a catalogue of safety issues and mitigation measures. A multisector review mechanism is established at the county level to review rural roads design (transport bureau, traffic police, natural resource bureau, environment protection bureau, water authority, and emergency response bureau), focusing on compliance, adequateness, road safety, drainages, and costs. Benefits and experiences from these changes were shared by participating counties with non-participating counties during annual Program experience-sharing workshops, who then adopted and implemented them in their own counties, showcasing the success of the replicability of PforR experience. Rating of Overall Efficacy 38. The overall efficacy of the PforR is rated High as the Program fully achieved or exceeded its targets. C. JUSTIFICATION OF OVERALL OUTCOME RATING 39. The overall outcome of the PforR rates Highly Satisfactory as there are no shortcomings in the Program’s achievements of its objectives or its relevance. Page 11 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) D. OTHER OUTCOMES AND IMPACTS (IF ANY) Gender 40. The Program brought direct benefits to females in the following aspects: i) Employment opportunities: The Program provided both temporary and regular job opportunities, with 241 females were employed for routine road maintenance in the 10 counties; ii) Participation in public consultation: Efforts were made to ensure the active involvement of women in public consultation, where the participation rate of females increased from 11 percent at the program preparation to 51.6 percent during implementation; iii) Enhanced accessibility to public services: The improved roads expanded safe and reliable bus services from villages to township and county capitals resulted in average travel time about 19-26 minutes per trip and improving overall accessibility to public services; and iv) Skills development and training: The participating counties organized 144 training sessions to 18,210 females in areas such as e-commerce, housekeeping, nursing, cultivation, and breeding. These training programs increased their skills and competence for various job positions. In summary, the program has not only focused on enhancing infrastructure but has also played a significant role in promoting gender inclusivity, creating employment opportunities, and fostering skill development for women in the targeted regions. Management of rural roads through Program for Results 41. Embarking on a very decentralized program of rural road development based on PforR principles became an innovation in itself. The PforR tested a set of ideas such as the result-based disbursement, monitoring and evaluation of rural road construction, rehabilitation, and maintenance, management of low-cost road asset registration and inventory, and the introduction of resilience and road safety technologies and solutions on a small scale, before rolling out the lessons learned to the rest of the province. Anhui Rural Road Resilience PforR successfully achieved both its Program objectives and the additional values provided by the PforR instrument. Poverty Reduction and Shared Prosperity 42. Implementation of the PforR has contributed to creation of over 700 direct and 50,000 indirect jobs, as well as over 1,200 business entities in the participating counties11. The Program’s implementation period coincided with the national and provincial agendas for poverty reduction12. As part of the national agenda on “war poverty”, Anhui provincial government invested over CNY 3 billion in poverty alleviation efforts. Concurrently, the Program’s implementation within the larger provincial transport program resulted in enhanced connectivity and management capacity of rural roads, contributing to the creation of economic opportunities. By 2018, five of the Program target counties had reached their poverty reduction targets, and three more achieved their goals in 2019. Before the Program closing, the remaining two counties were also lifted out of poverty13. While these results cannot be solely attributed to the Program’s success, it played a role in both the poverty reduction agenda and sustaining the government’s achievements through improved connectivity and safety of road infrastructure. 11 Anhui RRR PforR Borrower ICR, 2023 In 2018, the "Guiding Opinions of the Central Committee of the Communist Party of China and the State Council on 12 Winning the Three-Year War on Poverty Alleviation" was released. 13 Anhui RRR PforR Borrower ICR, 2023 Page 12 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Other Unintended Outcomes and Impacts 43. Good practices and experience gained from the PforR preparation and implementation has been shared with clients in Hunan Province in China preparing Hunan Subnational Governance and Rural Public Service Delivery Program for Results (P172325) and clients in Ethiopia preparing Ethiopia Rural Connectivity for Food Security (P176303) through study tours and experience sharing workshops organized by the World Bank. The Hunan Subnational Governance and Rural Public Service Delivery PforR was approved by the Board and is under implementation. III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME A. KEY FACTORS DURING PREPARATION 44. A well-established provincial comprehensive transport plan, its clear objectives, and corresponding plans, along with an existing institutional structure for implementation, contributed to a simple and practical Program design and rapid implementation. The 13th APFYCTP with six focus areas began implementation in 2016 and had already established a well- defined institutional arrangement to implement its rural road and bridge improvement programs. Riding on such a well-established government program with clear objectives and implementation structure, along with distinct value- adds from the World Bank through the PforR including innovations in institutional reform, monitoring and evaluation, reconstruction and maintenance of roads and bridges, and road management and operation, ensured an innovative yet highly relevant and easily implementable Program design. Based on the provincial government experience and pace of implementing its programs, the PforR design was able to identify the objectives and targets at the practical level of ambition, and the implementation plan of the Program with appropriate timing and sequencing of tasks. 45. A high quality and in-depth technical appraisal of the Program, through a feasibility study, ensured the Program’s DLIs were tangible and measurable, which allowed for good monitoring. Although a feasibility study (FS) was not required as part of the preparation of the Program, the clients had prepared one, providing a good basis for the Bank team to assess the overall technical, institutional, and fiduciary soundness of the Program. The willingness and ownership of the clients at both the provincial and county levels ensured high-quality preparation and implementation of the Program. The identified key beneficiary in the PDO, "participating counties in Anhui Province," was appropriate, and the PforR disbursement was linked to Program implementation progress in these participating counties. An expenditure framework assessment was carried out for the participating counties to ensure the PforR did not impose any fiscal burden, and each county could affirm fiscal sustainability and funding predictability. The results framework of the PforR was adequately designed, with specific, measurable, attributable, replicable, and time-bound (SMART) PDO and intermediate results indicators. The disbursement-linked results (DLR) verification protocol was clear, including the collection and compilation of data from County Transport Bureaus (CTBs) by the Provincial administration, and the Independent Verification Agent (IVA) to: i) survey 10 percent of the completed works to conduct verification of climate resilience and road safety dimensions attached to the DLI 1, DLI 2.1, and DLI 2.2, and ii) verify a set of 12 indicators for the verification of DLI 3. The overall risk rating of the program was Moderate, with institutional capacity for implementation and sustainability rated with the highest risk rating of Substantial. The mitigation measure for this risk was to provide continuous training to all participating agencies of the Program implementation. Implementation was carried out effectively by the Borrower, and adequate measures are in place to ensure the sustainability of the PforR achievements. Therefore, it is assessed that risks were adequately measured through sufficient capacity building and training. Page 13 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) B. KEY FACTORS DURING IMPLEMENTATION Factors subject to the control of government and/or implementing entities 46. Anhui Provincial Government (APG) had an exemplary commitment and ownership backed by GoC on the implementation of the PforR. The PMO led the implementation, monitoring, and reporting of technical, fiduciary, safeguard, monitoring, and evaluation tasks at a professional level with adequate resources. The PMO also collaborated engaged with ChinaRAP to assess road safety ratings of the program roads at the end of the program. In addition, they successfully obtained verification of road safety indicators, ensuring double verification of the improved road safety of roads. As of 2020, APG provided twice as much subsidy to county, township, and village roads periodical and rehabilitation maintenance works compared to program design stage, piloted commercial insurance for rural roads in 27 counties to mitigate financial burden of natural disaster risks, promoted the four-excellence in rural road management, and recognized 26 counties as demonstration counties of implementing the program. The PDO of the PforR, well-aligned with the priorities of APG and their commitment to rural transport development, were key factors in the smooth implementation of the PforR and achievement of the PDO. 47. While the PforR was designed to make use of the already well-established administrative and implementation structure, personnel reorganization as part of the transport sector reforms affected its implementation. Anhui was selected for institutional reforms in the transport sector institutions as one of the four pilot provinces across China by the GoC. The reform process commenced soon after the PforR went into effect. As early as the beginning of 2019, provincial transport institutions underwent restructuring, cascading into municipal and county institutions with a scheduled completion of the reform by 2021. While the integrity of the implementing entity, as per the financing agreement of the PforR, was maintained throughout this reform process, reforms resulted in staffing reorganization and a high turnover rate within transport institutions at all levels. This impacted the implementation of the PforR, specifically in completing the procurement of the IVA to verify program results for timely disbursement and reduce the impact on human resource capacity strengthening. For example, the capacity building for rural road management was disrupted and was not implemented to its fullest potential because county-level transport management personnel changed due to the consolidation of divisions and staff. Factors subject to the control of the World Bank 48. The World Bank task team consistently provided engaged, responsive, and close implementation guidance and support. The PforR was led by four task-team leaders (TTL) throughout its lifetime, while the co-task team leader (co- TTL) remained constant. The continuity of the Co-TTL (later became the TTL) ensured a smooth transition in PforR supervision and engagement with the clients. According to the Borrower’s ICR, the Bank team provided high quality implementation guidance with adequate and appropriate technical experts, conducting frequent (eight in total) missions to Anhui, undertaking site-visits during each mission, engaging with all relevant stakeholders equally, providing technical guidance, sharing relevant information, and remaining agile in identifying risks and suggesting necessary countermeasures. The Program documents, including Aide-Memoirs and ISRs, to be succinct and of high quality. However, the documents’ conciseness has some shortcomings, for example, the documentation on the implementation of the PAP is insufficient and did not provide sufficient information. Minor errors in reporting Monitoring and Evaluation (M&E) results, as mentioned in paragraph 53 below, constitute other small shortcomings. Page 14 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Factors outside the control of government and/or implementing entities 49. During 2020 – 2022, the raging spread and GoC’s responses to COVID pandemic created new challenges for the implementation of the PforR. The nationwide closure and quarantine during 2020 caused several county-level activities to miss the target completion, delivery, and acceptance timelines. Subsequently, the disbursement of the PforR was affected with verification of Program results being delayed from 2021 to September 2022. Moreover, training activities planned under the PforR were postponed and/or moved online, reducing effectiveness of providing guidance in applying the innovations of climate resilience, road safety, and institutional strengthening to the county and municipal level transport staff. Yet, the overall implementation of the PforR and achievement of outcomes was not largely affected by COVID thanks to the strong priority placed on the implementation of both the provincial and PforR programs by Anhui Provincial government; and continuous support provided by the Bank task team. Delays due to strict quarantine periods were offset during more normal working period with expedited work schedule, resulting in the overall achievement of the target timeline. IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME A. QUALITY OF MONITORING AND EVALUATION M&E Design 50. The overall logical framework on which the Program is based is sound and clear. However, the Program was prepared before the mandate for the preparation of a theory of change was introduced to all World Bank projects. The long-term development impact that the Program aimed to achieve is improved and equitable access for rural residents in Anhui Province to access employment opportunities and social services address. Development objectives of the program (i.e., the PDO) which is to “improve rural road network connectivity, safety, quality, and its management” enabling the long-term impact, were meaningful, effective, and clearly specified. 51. The indicators designed to measure progress towards achieving the PDO were all good means of measuring intermediate outcomes of the Program but not sufficient to measure the PDO level outcome. The choice of the indicator "county and townships roads in excellent and good condition," designed to measure the improved connectivity, safety, and quality aspect of the PDO, is not fully sufficient to measure the progress towards improved connectivity and safety aspects of the PDO. This aspect of the PDO could have been better measured by additional, more direct, and more outcome-oriented indicators such as travel time, the number of fatalities or injuries from road crashes, or at least ChinaRAP road safety star ratings. Nevertheless, the DLIs were well-aligned with the PDO and covered connectivity, quality, safety, and management aspects of the PDO. The six intermediate indicators were linked to the DLIs and were adequate to capture the contribution of the PforR’s activities and outputs toward achieving the PDO-level outcomes. 52. While the M&E arrangements, including indicator descriptions, methodology for data collection, measurement, verification, and the responsibility for data collection, were fairly well-defined, measurable, and well in line with the existing institutional framework in Anhui, there were some inconsistencies in the Results and Framework (R&F) design and implementation. The methodology and the chosen unit of measurement for PDO indicator 3, "Rural road network management capacity improved through institutional reform," are inconsistent in the R&F. The methodology of the R&F states that "if the intermediate indicators 3.1, 3.2, and 3.3 targets are achieved annually, this PDO indicator target would Page 15 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) be evaluated as achieved as a 'Yes.''' However, the unit of measurement is in numbers, with a baseline value of 0 and a target value of 10 in the same R&F. M&E Implementation 53. The baseline values for PDO indicators were measured and included in the R&F at the time of PforR approval. All nine outcome and intermediate indicators were measured and reported in the semi-annual Implementation Status and Results Reports (ISRs) at an interval of four to ten months. All indicators were measured more frequently than the original M&E design. For example, the measurement frequency of Intermediate Indicator 3.2 was set to be measured only once during the life of the program, however, the indicator value was measured and reported at every ISR. Some indicators were inconsistently reported between different reporting periods, for example, ISR 5 and ISR 6 reported indicator values from the same measurement period, October 15, 2021, but values of three intermediate indicators were different between the two ISRs. These errors were a byproduct of institutional reform and staff change, but the inconsistencies were corrected in subsequent ISRs and the reported M&E values were consistent at the end of the Program. However, the discrepancy found for PDO indicator 3 (explained in above paragraph) was not corrected throughout the PforR implementation, and all ISRs report the indicator status in numbers instead of Y/N value. 54. The verification protocol for DLIs was established and carried out during the PforR, with significant lags. The IVA was procured and onboarded by November 2020, two years after the program approval. After the Program advance payment of 50 million USD was disbursed in January 2020 for the works completed in 2018, there was a significant lag until the first verification report was completed. The IVA verified retroactive program results for 2018 by December 2020, and continued to verify results for 2019 by January 2022, results for 2020 by September 2022, results for 2021 by December 2022, and for 2022 by June 2023. The disbursement was relatively slow due to the lengthy verification process. The delay in the disbursement tied with the verification process was reported to be a challenge for the program implementing counties with limited budget, as the counties reported to have as much as two years lag in contractor payment. Despite these delays, the implementing agency carried out planned works and achieved all targets in timely manner. 55. Thanks to the good design of the PforR’s M&E which is well-embedded in the client’s road asset management and planning processes, the M&E functions are expected to be sustained after Program closing . The success of the sustainability of M&E processes is fully related to the domestication of implementation arrangements of the PDO indicator 3 based on the official establishment of an evaluation mechanism to assess rural road sector performance through three key indicators on construction, management, and maintenance, i.e., the continuation of the Four-Excellence program. M&E Utilization 56. The Program fully achieved all PDO indicator targets, all (except one) intermediate results indicator targets and DLIs as early as October 2021 just two years after program approval, with achievement of PDO indicator #1 target as early as June 2020, PDO indicator #3 target by December 2020. There is no record of the M&E information influencing a shift in the implementation direction of the operation. M&E findings were communicated to Program stakeholders during supervision missions, aide-memoires, implementation status reports, and M&E reports. Any lags in implementation identified through the M&E were highlighted by the Bank supervision team, who provided the necessary technical and operational guidance to remediate any delays. For example, one of the PforR counties, Sucheng, failed to meet the target completion rate in 2020. This was reported in the Program M&E report, and the reason was a fifty-year chance flood that Page 16 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) devastated the county. The Bank task team and the PMO paid particular attention to Sucheng county and provided technical and operational solutions to expedite the construction work with heightened climate resilience design features to help the county catch up with the program milestones. Justification of Overall Rating of M&E Quality 57. The overall quality of M&E rating is rated Substantial, as there are moderate shortcomings in the M&E system’s design, implementation, and utilization. The M&E system, as designed and implemented, was generally sufficient to assess the achievement of the objectives and to test the links in the results chain. B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE Environmental and Social 58. The Environmental and Social Systems Assessment (ESSA) conducted during PforR preparation 14 concluded that national and provincial regulations for environmental and social safeguards were, in-principle, consistent with Bank policy and directives. The identified inadequacies in the effective implementation of the local system were addressed through good enforcement and capacity building activities during PforR implementation. For example, Anhui Province established an environmental management organizational framework with clearly defined responsibilities among the PMO and the CTBs of participating counties, construction supervision consultants, and contractors. Moreover, environmental management plans (EMPs) were prepared, disclosed in the 10 counties, and were incorporated in supervision consultant and civil works contracts. Among participating counties, only one county (Yuexi) acquired 6.59 mu 15of land to implement the Program, which affected 49 households. Land acquisition and compensation were conducted in compliance with the national land law and Anhui Provincial land policies. The program had an active GRM in place and a third-party social monitoring consultant to support the PMO in implementation of social safeguard and assess the impact of the PforR on gender. As of the end of the PforR, it has been assessed that the environmental and social risks had been effectively managed through application of relevant national and local policies, and E&S performance had been rated satisfactory. Procurement and Financial Management 59. The procurement activities under the PforR primarily involved small and medium-value civil works and goods for the rehabilitation and upgrade of rural roads and bridges in the 10 participating counties, along with low-value consulting services and goods for institutional strengthening activities. During the PforR appraisal, the regulations and procurement systems in Anhui Province provided assurance that procurement under the PforR would be executed with adequate levels of transparency, accountability, competition, efficiency, and fairness. Throughout the PforR implementation, no contracts were issued to ineligible bidders/individuals, and there were no confirmed fraud and corruption cases. The Bank team provided appropriate procurement guidance and training to the clients. 60. The financing of the government program, which is supported through the PforR, comprises subsidies appropriated from the national and provincial government, counties' general budget funds, and IBRD loan proceeds. The provincial and county finance and transport departments and bureaus are responsible for the entire program implementation and 14 ESSA was conducted through a legal framework review, assessment of the institutional set-up and implementation mechanisms, public consultations, and field visits to similar rural road projects developed under the domestic procedures 15 Mu, Chinese unit of land measurement that varies with location but is commonly 806.65 square yards. 6.59 mu = 1.59 acres Page 17 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) associated financial management. As of the end of the PforR implementation, all IBRD funds had been fully disbursed. Audit reports for fiscal years 2019, 2020, 2021, and 2022 were submitted timely, and all issues raised had been effectively addressed. 61. At the Program closing, the fiduciary rating was Satisfactory after maintaining a Moderate rating throughout the implementation of the Program. C. BANK PERFORMANCE Quality at Entry 62. The Program design demonstrated a high level of responsiveness to the national development goals of the Government of China. As the government entered a development phase focused on consolidating and sustaining its developmental achievements across economic, social, and environmental dimensions, while embracing technological advancements and productivity enhancements, the Bank team ensured that the PforR was directly attuned to these needs. The design incorporated value-adds introducing innovations, efficiency measures, environmental considerations, safety enhancements, and best practices for managing China's extensive rural road network. 63. The Program's scope and objectives were in full alignment with the work plans and programs of the provincial government, resulting in a practical and achievable set of operations . Rigorous technical, fiduciary, and safeguards assessments conducted by the Bank ensured that the Program's objectives, scope, and the PAP were clear and fully embraced by the Borrower. This approach instilled critical sustainable development themes, emphasizing road safety, resilience, and the establishment of accountable and sustainable institutions—areas where Anhui province lacked focus during Program preparation. 64. While addressing the broader national and provincial development agendas and programs, the design of the program remained simple, easily implementable, and replicable. The stakeholder engagement and the quality of the appraisal process led to a Program design that has clear targets for tracking progress towards achieving the objectives, a program scope perfectly aligned with the government plan, an action plan implementable within the existing institutional structure, and a monitoring and evaluation plan that is adapted to the structures and capacities of the clients. As the first PforR in Anhui, the Bank carried out substantial capacity building activities for the preparation and implementation of the PforR, contributing significantly to the Program’s successful and implementation. The Bank Quality of Supervision 65. Throughout the Program implementation, the Bank remained responsive and hands-on despite facing considerable travel restrictions during the three-year span of the COVID pandemic that began in 2020. This proved crucial for the close supervision and guidance required to ensure the satisfactory and timely execution of the PAP. While the beneficiary counties demonstrated efficiency in construction, rehabilitation, and maintenance activities, the value of the PforR laid in the enhancement of technical and fiduciary capacities, as stipulated in the PAP. The task team reviewed all IVA reports, documents produced under the PAPs, conducted multiple site visits, and held consultations to ensure compliance with resilience, road safety, and fiduciary obligations, preparing for the dissemination and replication of Page 18 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) successful practices in other counties. Despite minor errors in some M&E reporting on certain ISRs, the Bank team's overall reporting was succinct and accurate. Justification of Overall Rating of Bank Performance 66. The overall rating of Bank Performance is rated Highly satisfactory, as there are no significant shortcomings in quality at entry and quality of supervision. D. RISK TO DEVELOPMENT OUTCOME 67. The primary risk to the development outcome revolves around the inadequacy of road asset management systems and tools, crucial for effective and proactive planning of road maintenance. While the PAP included a fixed asset registration book to record asset values and a basic inventory system for road classes, Anhui Province lacks a modern asset inventory system that records condition levels, construction records, and a systematic asset management and works planning tool for climate resilience and road safety. Comprehensive works planning based on the entire life cycle of road assets ensures prudent fiscal spending over the long term and proactive asset management practices for maintaining roads at optimal conditions consistently. The PMO reported Anhui Province's plan to complete the inventory of all road conditions by 2025 and introduce a life cycle cost-based asset management subsequently. Failure to implement a complete asset inventory system and an asset management planning tool could result in risks, including delayed repairs and maintenance, potentially compromising road quality. 68. Nonetheless, the PforR has effectively mitigated this risk to the extent possible. Mitigation measures include the reinforcement of county government accountabilities to rural roads through an annual performance evaluation mechanism (through the Four-Excellence program) and the enhancement of asset management capacities (routine maintenance). As awareness and tools for road assets management advance, Anhui's capacities are expected to continually improve. The Bank's financing of the Anhui Road Maintenance Innovation and Demonstration Project (P153173) supports the upgrading of road asset management systems in Anhui, with the potential for extension to rural roads in the future. V. LESSONS AND RECOMMENDATIONS 69. Designing the PforR with a programmatic approach within the overarching 13th Five-Year Comprehensive Transport Plan for Anhui Province (APFYCTP) led to a strong ownership by the clients. The government program, reinforced by the PforR, was one of the priority agendas of development for Anhui Province to improve rural road infrastructure and the level of transport service in the province. This prioritization facilitated a steadfast commitment by the clients to the attainment of PforR objectives, even in the face of unforeseen challenges such as an institutional reform and a global pandemic. The resultant robust ownership contributed to the successful achievement of Program Development Objectives (PDOs) and the timely execution of activities aimed at meeting the Disbursement-Linked Indicator (DLI) targets. 70. High quality program design and preparation with tangible, transparent, and verifiable DLIs resulted in smooth implementation and full disbursement, on time. Extensive discussions took place between the Bank team and the Page 19 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) clients during the preparation to gain a deeper understanding of the government program and to identify areas that the PforR could support. Diligent technical assessment comprising of a feasibility study on the government program, institutional and capacity assessment, county level expenditure framework assessment, fiduciary assessment, environmental and social systems assessment were conducted. This collaborative effort and in-depth technical appraisal led to the development of a strong and well-thought-out PforR design. 71. The PforR design for flow of funds incentivized timely implementation of program activities by local governments. The 13th APFYCTP was to be financed through i) subsidies appropriate from national and provincial government, ii) counties’ general budget funds, and iii) IBRD loan proceeds. These funds flowed through the government treasury system managed by the finance bureaus at provincial and county levels. Local governments were therefore incentivized to carry out the Program activities with resilience, safety, and innovation requirements on a timely basis to benefit from the PforR financing, which helped fill in the funding gap that county governments were liable for the implementation of the 13th APFYCTP. 72. A partial introduction of the "Four-Excellence program" proved to be a successful approach, unlocking implementation challenges of a new government initiative, and facilitating province-wide adoption. Initiated by the GoC in 2014, the Four-Excellence program aimed at enhancing institutional capacity for sustainable road asset management. Before the PforR, this initiative had not been included in any county government's performance evaluation criteria in Anhui and, consequently, had not yet been effective. Due to the complexity of implementation, the PforR supported the piloting of institutionalizing three of the four areas of the “Four-Excellence” program in county government's annual performance evaluation—excellence in construction, management, and maintenance of rural roads16—as a DLI, based on the findings of a thorough technical and institutional appraisal. This partial roll-out of the Four-Excellence program has proven to be successful in the participating counties and was further expanded to the entire province. 73. Deploying an Independent Verification Agent (IVA) to validate Program results ensured a robust monitoring mechanism for Program activities and magnified the Program's impact. The IVA systematically sampled no fewer than 10 percent of the road/bridge works across the ten participating counties, conducting assessments of construction, rehabilitation, and maintenance standards against a set of technical parameters tailored to the Program focus areas - climate resilience and road safety. These technical parameters were higher than domestic requirements, compelling participating counties to implement these standards across all county road works. This underscores the profound ripple effect of PforR investment, leading to substantial improvements in road safety and resilience at a broader scale compared to the investment amount. 74. Having a consistent country-based co-team leader or team leader facilitated a seamless transition of supervision team/lead changes, ensured close and hands-on supervision support during the COVID pandemic, and maintained a stable institutional memory for the Program throughout its implementation. 75. The strategic utilization of bank-executed trust fund resources significantly enhanced the quality of Program implementation, particularly for road safety improvement. Engaging ChinaRAP through the Global Road Safety Facility for a comprehensive assessment of road safety in two selected counties during PforR preparation, preparation of road 16 The fourth Excellence is “operation” of rural roads. Page 20 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) safety intervention catalogue based on the ChinaRAP assessment, and collaboration between the ChinaRAP and PMO during Program implementation to incorporate safe road design features for construction exemplified the added value brought by the Bank through this PforR. 76. The Program Action Plan (PAP), which comprehensively covered all aspects of the Bank's financing value-adds, played a crucial role in ensuring that the PforR not only effectively implemented the program and attained its development objectives but also instituted enduring institutional processes to sustain these objectives over the long term. The PAP comprised 13 actions across six themes—resilience, green roads, road safety, planning and implementation capacity, safeguards, and fiduciary capacity. These themes were identified as areas of improvement and gaps through rigorous technical, fiduciary, and safeguard assessments during the Program's preparation phase. . Page 21 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) ANNEX 1. RESULTS FRAMEWORK17, DISBURSEMENT LINKED INDICATORS, AND PROGRAM ACTION PLAN Annex 1A. RESULTS FRAMEWORK (i) PDO Indicators Objective/Outcome: Improve rural road connectivity and safety Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion County and township roads in Percentage 60.00 75.00 75.00 excellent and good condition (Percentage) 21-Feb-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Objective/Outcome: Maintain good quality rural roads 17As per the design of the Program, the 4 DLIs are verified by the Independent Verification Agent (IVA). The 4 DLIs are consistent with the Program’s Intermediate Results (IR) Indicators, which have therefore been verified by the IVA. As for PDO indicators, these do not have to be verified by the IVA, and the reporting is provided by the Project Management Office. The methodology for data collection is same for PDO indicator #3, DLI 3, and IR #3.1, therefore, it can be considered that the PDO indicator #3 reported values have been verified by IVA. Page 22 of 48 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Rural roads maintenance Percentage 50.00 98.00 98.00 coverage rate (all rural roads) 21-Feb-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Objective/Outcome: Strengthen institutional capacity Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Rural road network Number 0.00 10.00 10.00 management capacity improved through 21-Feb-2018 30-Dec-2022 30-Dec-2022 institutional reform Comments (achievements against targets): The actual target has been verified by IVA. (ii) Intermediate Results Indicators Results Area: Results Area 1: Improve rural road connectivity and safety Page 23 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion DLI 1: Rural roads improved Kilometers 0.00 5,014.00 5,851.78 with resilience and safety features 21-Feb-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Results Area: Results Area 2: Maintain good quality rural roads Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion DLI 2.1: Bridges reinforced, Meter(m) 0.00 8,899.00 9,728.37 demolished and/or reconstructed with resilience 21-Feb-2018 30-Dec-2022 30-Dec-2022 and safety features Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 24 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) DLI 2.2: Rural roads Kilometers 0.00 22,360.00 27,808.00 maintained with resilience and safety features 21-Feb-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Results Area: Results Area 3: Strengthen institutional capacity Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion DLI 3.1: Number of counties Number 0.00 10.00 10.00 that have incorporated “Construction, management 21-Feb-2018 30-Dec-2022 30-Dec-2022 and maintenance excellence’ criteria into annual performance assessment conducted by corresponding municipality Comments (achievements against targets): The second verification report confirms all the ten project counties incorporated the three Excellences in annual performance criteria and were evaluated by municipal governments. Indicator Name Unit of Measure Baseline Original Target Formally Revised Actual Achieved at Page 25 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Target Completion DLI 3.2: Number of counties Number 0.00 20.00 103.00 that the “Four-Excellence” program is rolled out beyond 21-Feb-2018 30-Dec-2022 30-Dec-2022 10 Program counties Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion DLI 3.3: Number of counties Number 0.00 10.00 10.00 with routine rural roads database updates 21-Feb-2018 30-Dec-2022 30-Dec-2022 Comments (achievements against targets): The reported actual targets are based on PMO reporting and have not undergone program designed verification process. ANNEX 1B. DISBURSEMENT LINKED INDICATORS DLI IN01244328 TABLE DLI 1: DLI 1: Rural roads improved with resilience and safety features (STP, NVRP, SRP /km) (Kilometers) Baseline Prior Results Jan 1, 2019 - Jan 1, 2020 - Jan 1, 2021 - Jan 1, 2022 - Total Page 26 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Dec 31, 2022 Original values 0.00 3,207.00 904.00 902.00 0.00 0.00 Actual values 50,991,300.00 904.00 902.00 0.00 5,014.00 14,389,500.0 14,341,800.0 0.00 0.00 Allocated amount ($) 50,991,300.00 28,731,300.00 0 0 14,389,500.0 14,341,800.0 0.00 0.00 Disbursed amount ($) 50,991,300.00 28,731,300.00 0 0 Comments (achievements against targets): Three verification reports have been submitted to the Bank. The Bank has no objection to a total of 4834.29 km roads completed and verified to meet the disbursement requirements of DLI1. The Bank has reviewed the verification report for works completed in 2020 and provided comments for revision/clarification, which includes 824.326 km of roads completed. DLI IN01244329 TABLE DLI 2: DLI 2.1: Bridges reinforced, demolished and/or reconstructed with resilience and safety features (linear m) (Meter(m)) Jan 1, 2019 - Jan 1, 2020 - Jan 1, 2021 - Jan 1, 2022 - Baseline Prior Results Total Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Dec 31, 2022 Original values 0.00 0.00 3,308.00 4,232.00 1,359.00 0.00 Actual values 0.00 3,308.00 4,232.00 1,359.00 8,899.00 13,232,000.0 16,928,000.0 5,436,000.00 0.00 Allocated amount ($) 0.00 35,596,000.00 0 0 13,232,000.0 16,928,000.0 5,436,000.00 0.00 Disbursed amount ($) 0.00 35,596,000.00 0 0 Page 27 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Comments (achievements against targets): Three verification reports have been submitted to the Bank. A total of 5727.96 linear meters of bridges completed and verified for works completed in 2019 and 2020 to meet the disbursement requirements of DLI2.1. DLI IN01244330 TABLE DLI 3: DLI 2.2: Rural roads maintained with resilience and safety features (km) (Kilometers) Jan 1, 2019 - Jan 1, 2020 - Jan 1, 2021 - Jan 1, 2022 - Baseline Prior Results Total Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Dec 31, 2022 Original values 0.00 0.00 13,720.00 16,771.00 19,566.00 22,360.00 Actual values 0.00 13,720.00 16,771.00 19,566.00 22,360.00 18,670,350.0 18,670,350.0 18,670,350.0 18,670,350.0 Allocated amount ($) 0.00 74,681,400.00 0 0 0 0 18,670,350.0 18,670,350.0 18,670,350.0 18,670,350.0 Disbursed amount ($) 0.00 74,681,400.00 0 0 0 0 Comments (achievements against targets): Three verification reports have been submitted to the Bank. A total of 19305.53 km roads maintained and verified for works completed in 2020 to meet the disbursement requirements of DLI2.2. DLI IN01244331 TABLE DLI 4: DLI 3: Number of counties that have incorporated Three (Construction, management and maintenance) excellence’ criteria into annual performance assessment conducted by corresponding municipality (Number) Jan 1, 2019 - Jan 1, 2020 - Jan 1, 2021 - Jan 1, 2022 - Baseline Prior Results Total Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Dec 31, 2022 Page 28 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Original values 0.00 0.00 10.00 0.00 0.00 10.00 Actual values 0.00 10.00 0.00 0.00 10.00 10,000,000.0 0.00 0.00 0.00 Allocated amount ($) 0.00 10,000,000.00 0 10,000,000.0 0.00 0.00 0.00 Disbursed amount ($) 0.00 10,000,000.00 0 Comments (achievements against targets): The second verification report confirms all the ten project counties incorporated the three Excellences into annual performance evaluation criteria and were evaluated by municipal governments in 2019. ANNEX 1C. PROGRAM ACTION PLAN PAP_TBL Achieved Action Timing Completion Measurement (Yes/No) Theme 1: Improve resilience (a) use Recurrent Yearly Yes Annual report by Engineer bureaus, reviewed by innovative and preventive maintenance PMO describing for any given year the technologies technologies to make rural roads and used for rural roads and bridges that could bring bridges more resilient; value added in theme of resilience of the infrastructure. Comments: Summary of innovative and preventive maintenance technologies are ongoing. Theme 1: Improve resilience: (b) review Recurrent Yearly Yes Forum on innovation with Local administration and current engineering designs for rural roads PMO once a year during WB supervision mission. and promote the benefits of added Page 29 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) resilience (cost benefit analysis) and conduct vulnerability assessment and response; Comments: Though the IVA reviewed the resilient features of completed rural roads, the benefit analysis and vulnerability assessment are not yet conducted. Theme 2: Toward “Green rural roads” Recurrent Yearly Yes One submission each calendar year of the catalog strategy: Open a catalog maintained by by PMO seeking WB comments. the PMO documenting any initiative by 10 counties in introducing efficient, low impact green activities in relation with maintenance and construction of rural roads. Comments: The development of catalog of introducing efficient and low impact green activities is ongoing. Theme 3: Integrate road safety features in Other Prior to completion of Yes ChinaRAP survey completed by effectiveness. PforR design: (a) With ChinaRAP, select detailed designs 270km roads that contain a sampling of 1 or more of the 7 critical location criteria & roadside hazard conditions (approx 170km of existing roads & 100km of recently.. Comments: 270 km of rural roads were surveyed and analyzed with ChinaRAP. Theme 3: Integrate road safety features in Due Date 31-Oct-2019 Yes Catalog of suitable measures completed and PforR design: (b) The PMO and ChinaRAP submitted to the Bank 6 months after will then work together to prepare a effectiveness. “catalog” of suitable countermeasures 1 Report by IVA during assessment of DLI 1 bout or more for each of the 7 critical location inclusion of road safety infrastructure during the criteria and for roadside hazard conditions design of the rural roads. Page 30 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Comments: Suitable measures were submitted to the Bank. IVA assesses the road safety features of completed rural roads during the verification. Theme 3: Integrate road safety features in Other IVA Report on DLI 1 Yes Report by IVA during assessment of DLI 1 about PforR design: (c) conduct design stage inclusion of road safety infrastructure during the audits to ensure proper inclusion of road design of rural road. safety infrastructure. Comments: IVA assesses the safety features of completed rural roads during the verification. Theme 4: Improve planning and Recurrent Yearly Yes PMO to send a report to the WB before the end of implementation capacity: (a) launch each calendar year reporting on the performance periodic assessment of the local of the local authorities. authorities’ performance. Comments: PMO reported annual plan and implementation results of project counties in project reports. The results show the project counties have adequate capacities to plan and implement the rural roads programs. Theme 5: Strengthen environmental & Recurrent Yearly Yes IVA to report on progress on environment and social safeguards systems; incorporate social safeguards systems within each bi-annual environmental supervision into the report about DLI 1. bidding documents & contracts of supervision consultants, as well as reflect environmental performance of contractors in supervision reports Comments: incorporate environmental supervision into the bidding documents and contracts of supervision consultants, as well as reflect environmental performance of contractors in the supervision reports. Theme 6: Improve fiduciary capacity: Recurrent Continuous Yes IVA to report on procurement actions a) within Procurement (a) the cost estimates shall each bi-annual report about DLI 1. be based on market analysis and updated on a regular basis; Page 31 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) Comments: The IVA reviews and reports the procurement management in semiannual report, such as procurement procedure and data sources for cost estimates etc. Theme 6: Improve fiduciary capacity: Recurrent Continuous Yes IVA to report on procurement actions b) within Procurement (b) the evaluation criteria each bi-annual report about DLI 1. shall include proper check of the qualifications and adequacy of key staff. Comments: The IVA reviews the qualification requirements of key staff in bidding documents and confirms the adequacy of the requirements in semiannual reports. Theme 6: Improve fiduciary capacity: Recurrent Yearly Yes Prepare the budget execution report for Financial Management (a) prepare government general budget (3 accounts) and program financial report and furnish to government funds (only for account #2120804); external auditors for annual audit. Comments: Project counties prepare program financial reports that are subject to external auditors for annual audit Theme 6: Improve fiduciary capacity: Recurrent Yearly Yes Submit program annual audit report to the Bank Financial Management (b) agree an audit within 6 months after the end of each fiscal year. terms of reference (TOR) with the Bank and conduct an annual Program financial statement audit that will be publicly disclosed; Comments: The Bank has no objection to the TOR draft prepared by the PMO for audit. The PMO submits and discloses audit report as required. Theme 6: Improve fiduciary capacity: Recurrent Continuous Yes A complete fixed assets registration book is Financial Management (c) maintain fixed maintained by CTBs for the assets they manage. assets registration book to ensure value of fixed assets could be recorded properly & be presented in financial reporting once Page 32 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) they are required by related policies & proced Comments: Project counties are developing databases of fixed assets. Page 33 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION A. TASK TEAM MEMBERS Name Role Preparation Supervision/ICR Xiaoke Zhai, Anita Shrestha Task Team Leader(s) Jianjun Guo Procurement Specialist(s) Yi Dong Financial Management Specialist Limei Sun Team Member Yan Zhang Procurement Team Aristeidis Panou Counsel Kai Shang Social Specialist Bin Xu Environmental Specialist Dongqi Qian Team Member B. STAFF TIME AND COST Staff Time and Cost Stage of Project Cycle No. of staff weeks US$ (including travel and consultant costs) Preparation FY16 4.425 24,765.26 FY17 28.430 185,342.13 FY18 34.868 235,324.23 FY19 10.548 74,628.24 FY20 .400 2,111.92 Total 78.67 522,171.78 Supervision/ICR Page 34 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) FY19 2.847 22,043.84 FY20 8.785 57,908.53 FY21 12.450 76,737.23 FY22 8.900 56,427.69 FY23 22.425 142,074.43 FY24 10.625 45,119.01 Total 66.03 400,310.73 Page 35 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) ANNEX 3. PROGRAM EXPENDITURE SUMMARY Actual Expenditures (Disbursement) Source of Program Type of Co- Estimates at Financing (US$) Financing Appraisal Percentage of Percentage of Actual Appraisal Actual World Bank IBRD Loan 200,000,000 200,000,000 100% 100% Counterpart Borrower 345,000,000 390,746,442 113.3% 100% Funding Total 545,000,000 590,746,442 108.4% 100% Page 36 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) ANNEX 4. BORROWER’S COMMENTS (I) Borrower's evaluation of World Bank Loan for Anhui Rural Road Improvement and Reconstruction Demonstration Project A Loan Agreement on "World Bank Loan for Anhui Rural Road Improvement and Reconstruction Demonstration Project" (hereinafter referred to as the "Project") was signed on December 29, 2018, and formally took effect on February 25, 2019. The implementation cycle of the Project is from December 29, 2018, to December 31, 2022, and the subprojects implemented from October 12, 2016, to December 29, 2018, that conform to the contents of the Project have been traced and recognized. During the 6-year period, with the support of funds, the Project has yielded substantial results including 2,847.455 km of smooth traffic works (natural village roads), 3,004.326 km of security works, 9728.5 linear meters of dangerous bridge renovation works, and 27,808 km of rural road maintenance works in Anhui Province. The total completed investment has reached CNY4.276 billion (including a loan of 200 million US dollars from the World Bank, accounting for 34%). With the use of a result-oriented loan tool (PforR), based on Anhui Province "13th Five-Year Plan" for rural road construction, for the goal of improving the connectivity, safety, quality, and management level of rural road network in Anhui Province, the Project established a loan mode based on the construction scale. This mode mainly relies on the domestic project management system to manage and implement the Project and provides the Borrower with a high degree of flexibility to some extent. It is the institutional flexibility and the adaptability of policies that ensure that the construction objectives concerning the Project can still be completed on time and with high quality under the impact of emergencies such as COVID-19 pandemic and natural disasters. Efficient and convenient withdrawal mode and flexible and applicable security policy are the guarantee for the smooth implementation of the Project, which is eye-catching in the transportation field that has been deeply explored for many years under the traditional project loan tools and provides a new idea for the loan work of Anhui and even the whole country in the foreign investment field. Meanwhile, this also plays a demonstration and leading role in the construction of rural transportation infrastructure in Anhui Province, which is embodied in: The implementation of the Project has alleviated the financial pressure of rural road construction in the pilot counties to a certain extent, helped the county-level governments to complete the tasks of Anhui Province "13th Five- Year Plan" for rural road construction with high quality, and also laid a good foundation for the implementation of the "14th Five-Year Plan”. Thanks to its highly adaptable and forward-looking features, the Project has brought high added value to rural road construction in Anhui Province. First, it has provided support for poverty alleviation work of 9 poverty-stricken counties, served the rural revitalization strategy of the whole province, and helped 10 counties to become national or provincial "Four Good Rural Roads" demonstration counties. Additionally, in order to improve the management ability of rural road construction in Anhui Province, a series of action plans were set up for the Project, including adaptability, green highway strategy, safety, planning and implementation ability, and environment, social security, and trust ability. The implementation of these action plans, to a certain extent, by push-back and force-back, started the self-driven improvement in the aspects of rural traffic governance system and capacity at the levels of Anhui Province and 10 project counties. For example: (1) The implementation of above action plans has promoted Anhui Province to bring the "Four Good Rural Roads" into the government performance appraisal scope, accelerated the construction of an asset management platform, and facilitated the market-oriented reform of rural road maintenance. Page 37 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) (2) A number of innovative and preventive maintenance technologies have been applied and summarized, a green action catalog on rural roads has been compiled, the adaptability of rural roads has been enhanced, and new focuses on rural road construction in Anhui Province have been created. (II) Borrower's evaluation of the World Bank From July 2016 to March 2023, the World Bank had dispatched technical support teams 10 times, with a total investigation duration of about 2 months, and the teams were dispatched once every six months averagely for field investigations. Among them, two investigations were difficult to be carried out in the field due to the Covid-19 pandemic. The World Bank's teams still actively coordinated online assessment and monitoring to ensure the regularity and standardization of their work. The World Bank has made contributions across the whole process of the Project and has showed a high level of performance in the stages of preliminary design, implementation and management, summary, and improvement of the Project. (1) In the design assessment stage, the World Bank provided the Project with sufficient forward-looking policies, innovative management methods, and normative system. In the preliminary design of the Project, the World Bank fully considered the possibility of linking the project results with the rural transportation policies under the "13th Five-Year Plan" and even the "14th Five-Year Plan" at the national and provincial levels and formulated a forward-looking action plan to make the project design involve a wider range and have stronger policy adaptability. In the design orientation of the Project, the World Bank fully considered the possible innovative impact of the implementation of the activities about the Project on the management mode of Anhui provincial government and set objectives of management mode innovation in many fields in advance, such as government budget formulation, project monitoring and performance evaluation. While promoting innovation, it also considered the sustainability of the project at the time of completion in the design. In addition, the World Bank fully considered the transparency, participation, and fairness about the Project, and specified the systems for regular monitoring and evaluation of support teams from the World Bank, environmental performance evaluation, social external monitoring, and verification indexes of independent verification institutions in advance, thus ensuring the standardization of project implementation. (2) The World Bank provided financial support, capacity building, and adjustment space for the Project in the implementation stage. First, the project funds were allocated efficiently and quickly, providing financial support for project implementation and management. All the project counties acknowledged that the World Bank allocated the project funds quickly. After the project office submitted an application, it could receive the corresponding advance payment from the World Bank rapidly; after one verification report in the project implementation process passed the World Bank's review, the corresponding loan could be quickly withdrawn, ensuring the capital needs in the project implementation. Second, the World Bank provided effective guidance for the staff of the project counties and capacity building for project implementation and management. During the field investigations, the support team from the World Bank provided continuous and perfect training and guidance to the front-line staff in the project counties, and improved the project management mode and management level of the project counties through target design, index verification, fund management, environmental and social testing, and performance evaluation, thus indirectly realizing the capacity building of the project counties. Third, the World Bank actively advanced the matching of national policy objectives with Anhui's actual needs, and provided adjustment space for project implementation and management. During the implementation of the Project, the World Bank and the project office always paid attention to the new requirements of rural road policies at the national and provincial levels, and continuously incorporated them into the verification standards of the Project. (3) In the summary and improvement stage, it summarized the innovation mode for the Project, guided the preparation of the summary report, and promoted the dissemination of project innovation information. First, the World Bank continuously summed up the sustainability and reproducibility experience from the Project, and assisted Anhui in Page 38 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) developing an innovative mode of rural road construction management. Second, through the memorandums of the support team, the good experience and practices of project implementation during the field investigations were recorded in written form, and were suggested to be promoted. The relevant experience involved rural road green strategy, innovative and preventive maintenance technology promotion, etc., which provided a basis for summing up project experience and lessons. Third, the World Bank actively promoted the upward flow of rural road innovation experience in Anhui Province and advanced the bottom-up dissemination of innovation information. During the project implementation stage and the project summary and improvement stage, the World Bank continued to help Anhui Province summarize project innovation experience and innovation mode, and summarized this high-quality innovation information to the national level. For example, the World Bank invited Anhui Province to participate in the "World Bank Transportation Loan Project Experience and Results Sharing Conference" to share project experience and results with national counterparts. The World Bank also recommended Hunan Highway Affairs Center to come to Anhui Province for investigation and study, and the two sides had an in-depth discussion on the advantages and disadvantages and precautions of PforR loan mode. The World Bank actively promoted the bottom-up dissemination of innovative information, which promoted the innovation of rural road construction management system in China to a certain extent. Generally speaking, the World Bank set aside a relatively loose space for policy adaptation and adjustment, which could fully help the work of the project counties adapt to the policy changes at the national and provincial levels. At the same time, the local level could form a focused and distinctive working mode that can be promoted, which then can respond to the policies at the national and provincial levels, so as to realize the two-wheel drive of the central and local governments for traffic construction. Page 39 of 40 The World Bank Anhui Rural Road Resilience Program for Results (P158733) ANNEX 5. SUPPORTING DOCUMENTS (IF ANY) Page 40 of 40