PROJECT INFORMATION DOCUMENT (PID)
                                                           APPRAISAL STAGE
                                                                                                          Report No.: PIDA3916
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                         Project Name                          MN Education Quality Reform Project (P148110)
                         Region                                EAST ASIA AND PACIFIC
                         Country                               Mongolia
                         Sector(s)                             Primary education (100%)
                         Theme(s)                              Education for all (60%), Education for the knowledge economy
                                                               (40%)
                         Lending Instrument                    Investment Project Financing
                         Project ID                            P148110
                         Borrower(s)                           Government of Mongolia
                         Implementing Agency                   Ministry of Education and Science
                         Environmental Category                B-Partial Assessment
                         Date PID Prepared/Updated             25-Feb-2014
                         Date PID Approved/Disclosed           25-Feb-2014
                         Estimated Date of Appraisal           10-Mar-2014
                         Completion
                         Estimated Date of Board               31-Dec-2014
                         Approval
                         Decision
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                         I.   Project Context
                              Country Context
                              1.       Mongolia is the least densely populated country in the world. It is the second largest
                              landlocked country in the world and has a large nomadic population. The number of urban
                              inhabitants has grown rapidly in recent years; almost half the population now lives in the capital
                              city, Ulaanbaatar (UB). This has resulted in an education system that is characterized by a large
                              number of medium- or small-sized schools that are geographically isolated. Unit costs increase
                              significantly as the distance from UB increases.

                              2.       Mongolia is divided administratively into UB and 21 aimags (provinces). UB is divided
                              into districts and khoroos (city wards). The aimags are divided into districts known as soums, and
                              soums are divided into baghs (villages). The rural areas continue to be largely agricultural, though
                              the recent development of extensive mineral deposits has increased industrial production in these
                              areas. The incidence of poverty remains high. Urban poverty is also growing, and both rural and
                              urban areas have significant service delivery challenges, although these are very different in nature.

                              3.      While the first decade following Mongolia’s transition in 1990 to a market-based economy
                              saw sluggish growth, the past decade has seen a dramatic turnaround, driven largely by the



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                         burgeoning mineral sector. Mongolia’s Gross Domestic Product has grown at an annual rate of
                         eight percent for ten years, and is projected to experience double digit growth for the next several
                         years. However, this period of growth has also been characterized by a rise in perceptions of
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                         income inequality and persistent labor market stagnation.

                         4.      Mongolia has a young population; about 60% are under thirty years of age. While fertility
                         rates have fallen sharply—more so than in any other country in the world—resulting in a declining
                         number of school age children over the past decade, this trend is reversing, and the number of
                         school-aged children is expected to grow over the next decade. Mongolian is spoken by 95% of the
                         population; a variety of dialects are spoken across the country. In the west of the country, Kazakh
                         and Tuvan are also spoken.

                         Sectoral and institutional Context
                         5.       The education system in Mongolia has been experiencing a period of reform over the past
                         decade. The entrance age into primary school was lowered during this period from eight years of
                         age to six. The length of the basic education cycle was increased from ten to twelve years. The
                         education system now consists of five years of primary school, four years of lower secondary
                         school, and three years of upper secondary school. Upper secondary school is free but not
                         compulsory. Many schools also offer pre-school programs of two or three years in length. The first
                         cohort of students to have completed the full twelve-year cycle will graduate in 2020.

                         6.       Mongolia has done well in extending access to pre-primary and basic education since its
                         transition. Basic education enrollment has recovered with the economy. The 1990s saw a drastic
                         decline in school enrollment ratios; the 2000s witnessed its recovery to the pre-transition level in
                         pre-primary through lower secondary education; the current decade will likely see an extension of
                         access in pre-primary and post-primary education. The national net enrollment rates of 90% and
                         82% for primary and secondary education, respectively, compare favorably with middle income
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                         countries around the world.

                         7.      The issue of gender in Mongolian education is in many ways the reverse of what is seen in
                         most countries at a similar stage of economic development. Both genders show roughly 100%
                         completion rates for primary education, but girls achieve slightly more secondary schooling and
                         much more tertiary education than boys. Momentum over the past decade has swung in favor of
                         boys. Boys’ primary school enrollment rates are now slightly ahead of girls, and the difference in
                         secondary enrollment rates has declined from over 10% to 1% in less than a decade. Girls still
                         represent 60% of tertiary enrollments, although here too the differences are declining rapidly.
                         Recent achievement tests show little difference in learning outcomes for boys and girls, although
                         for both genders, learning levels are worrisomely low. The area of clearest gender bias in the
                         education sector is that of employment: men represent only 4% of the primary school teaching
                         force but 45% of school-level management (school directors and teaching managers).

                         8.       Having successfully extended access to basic education, the Government has now placed a
                         much sharper focus on improving the quality of primary and secondary education. With nearly 30
                         percent of the population under the age of 14 and 12 percent under the age of 5 , and in light of the
                         rapid changes and emerging issues the country is facing -- managing its mineral wealth,
                         transitioning to middle-income status, handling increasing rural to urban migration, and responding
                         to the structural changes in its labor market -- MES has stated its intention that Mongolia’s



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                             education system be a provider of high quality skills and a key driver of growth. As such,
                             Mongolia’s education system will need to deliver not just a greater quantity of skills (the share of
                             the population with a certain level of education and training), but also greater quality skills (better
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                             cognitive, non-cognitive, and technical skills that will help its citizens deal with complex and
                             unexpected tasks and to continue to learn throughout their lives). This imperative implies a
                             sharpened focus on increasing the quality of education, starting from the earliest ages.

                             Key Issues Facing the Education Sector

                             9.      Several challenges must be addressed if the Government is to deliver on its promise of
                             higher quality education. A brief summary is given below:

                             •       The lack of learning materials in urban areas has inhibited the student experience.
                             •       Available information on student learning outcomes shows alarmingly low performance,
                             and disparities exist between Ulaanbaatar, aimag centers and soums.
                             •       The lack of a systematic and institutionalized comparable assessment of student
                             performance, starting from the earliest years is a large obstacle in improving the quality of basic
                             education.
                             •       The quality of teaching in primary and secondary schools in Mongolia is an area of prime
                             concern.
                             •       Preliminary findings from a Bank-commissioned study on how teachers are groomed,
                             retained, and maintained reveals a teacher training system that is not very dynamic, and does not
                             appear to be reaching a high level of quality in terms of preparing teachers for future service.
                             •       Finally, instructional time in Mongolian schools is relatively low.

                             10. To address these issues, MES has recently introduced a rigorous reform agenda to improve the
                             quality of basic education. This agenda – “The Educational Quality Reform Program” – centers on
                             three pillars. The first pillar is called “The Book Project” (the scale-up of the IDA-financed Rural
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                             Education and Development (READ) project). The second pillar is a Teacher Development and
                             Upgrading Program. And the third pillar is a so-called “Talent Program,” which is a school grants
                             program to increase discretionary spending at the school level to provide further educational
                             enrichment opportunities and increase educational quality.

                         II. Proposed Development Objectives
                             The Project Development Objective is to improve the quality of education for primary school
                             children in Mongolia with particular emphasis on improving reading and math learning outcomes.

                         III. Project Description
                             Component Name
                             Improving learning 0utcomes
                             Comments (optional)
                             The purpose of this component is to ensure that by the end of second grade of primary school,
                             Mongolia students are able to read fluently and acquire basic numeracy and math skills.
                             Component Name
                             Pre- and in-service professional development of teachers
                             Comments (optional)
                             The purpose of this component is to upgrade teacher quality by helping teachers develop the


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                               appropriate tools to provide individualized support for all children to improve their learning
                               outcomes.
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                               Component Name
                               Implementation of a school grants program
                               Comments (optional)
                               The purpose of this component is to scale up MES’s “Talent Program” of school grants, currently
                               being rolled out in 100 pilot schools, to the rest of the primary schools in the country.
                               Component Name
                               System management, monitoring and evaluation
                               Comments (optional)
                               The purpose of this component is to support MES to effectively implement the project with the
                               support of qualified technical assistance.


                         IV. Financing (in USD Million)
                               Total Project Cost:   26.00                 Total Bank Financing: 26.00
                               Financing Gap:        0.00
                               For Loans/Credits/Others                                                                     Amount
                               BORROWER/RECIPIENT                                                                              0.00
                               International Development Association (IDA)                                                    26.00
                               Total                                                                                          26.00

                         V. Implementation
                               Overall responsibility for the proposed project supporting the MES reform agenda will be vested
                               with MES. Project implementation will be mainstreamed using the MES structure at the central and
                               decentralized (Aimag) levels supported by qualified TA to be financed by the project. Education
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                               departments and relevant government officials at aimag (province) and soum (village) levels and
                               schools will be responsible for the activities executed at the decentralized level over the five-year
                               project period.

                         VI.    Safeguard Policies (including public consultation)
                               Safeguard Policies Triggered by the Project                                        Yes           No
                               Environmental Assessment OP/BP 4.01                                                 ✖
                               Natural Habitats OP/BP 4.04                                                                      ✖
                               Forests OP/BP 4.36                                                                               ✖
                               Pest Management OP 4.09                                                                          ✖
                               Physical Cultural Resources OP/BP 4.11                                                           ✖
                               Indigenous Peoples OP/BP 4.10                                                       ✖
                               Involuntary Resettlement OP/BP 4.12                                                              ✖
                               Safety of Dams OP/BP 4.37                                                                        ✖
                               Projects on International Waterways OP/BP 7.50                                                   ✖
                               Projects in Disputed Areas OP/BP 7.60                                                            ✖

                               Comments (optional)



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                         VII. Contact point
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                             World Bank
                             Contact: Prateek Tandon
                             Title:   Senior Economist
                             Tel:     473-6449
                             Email: ptandon@worldbank.org

                             Borrower/Client/Recipient
                             Name: Government of Mongolia
                             Contact:
                             Title:
                             Tel:
                             Email:
                             Implementing Agencies
                             Name: Ministry of Education and Science
                             Contact: Ts. Bayarkhuu
                             Title:   Head, Finance and Investment Division
                             Tel:     976-11-265696
                             Email: bayarkhuu@mecs.gov.mn
                         VIII. For more information contact:
                             The InfoShop
                             The World Bank
                             1818 H Street, NW
                             Washington, D.C. 20433
                             Telephone: (202) 458-4500
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                             Fax: (202) 522-1500
                             Web: http://www.worldbank.org/infoshop




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