Document of The World Bank FOR OFFICIAL USE ONLY Report No: RES17050 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF AGRICULTURE SECTOR DEVELOPMENT PROJECT (CREDIT - 51720-TA) BOARD APPROVAL: JUNE 15, 2006 TO THE UNITED REPUBLIC OF TANZANIA November 28, 2014 Agriculture Global Practice (GFADR, AFR3) Country Department 1 Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. ABBREVIATION AND ACRONYMS AF Additional Financing ASDP Agricultural Sector Development Project CAS Country Assistance Strategy Cr Credit DP Development Partners GoT Government of Tanzania IDA International Development Association LGA Local Government Authority MAFC Ministry of Agriculture Food Security and Cooperatives PDO Project Development Objective SDR Special Drawing Rights SWAp Sector Wide Approach URT United Republic of Tanzania Regional Vice President: Makhtar Diop Country Director: Philippe Dongier Senior Global Practice Director: Juergen Voegele Practice Manager: Tijan M. Sallah Task Team Leader: Zainab Z. Semgalawe ii DATA SHEET Tanzania Tanzania Agricultural Sector Development Project (P085752) AFRICA Report No: RES17050 Basic Information Project ID: P085752 Lending Instrument: Specific Investment Loan Regional Vice President: Makhtar Diop Original EA Category: Partial Assessment (B) Country Director: Philippe Dongier Current EA Category: Partial Assessment (B) Senior Global Practice Juergen Voegele Original Approval Date: 15-Jun-2006 Director: Practice Tijan M. Sallah Current Closing Date: 31-Dec-2014 Manager/Manager: Team Leader: Zainab Z. Semgalawe Borrower: MINISTRY OF FINANCE Responsible Ministry of Agriculture Food Security and Cooperatives Agency: Restructuring Type Form Type: Short Form Decision Authority: Country Director Approval Restructuring Level 2 Level: Financing ( as of 27-Oct-2014 ) Key Dates Approval Effectiveness Original Revised Project Ln/Cr/TF Status Signing Date Date Date Closing Date Closing Date P085752 IDA-41920 Closed 15-Jun-2006 30-Aug-2006 18-Oct-2006 31-Dec-2011 31-Mar-2014 P085752 IDA-46390 Closed 09-Jun-2009 22-Jul-2009 20-Aug-2009 30-Jun-2012 31-Mar-2014 P085752 IDA-47400 Closed 28-May-2010 11-Jun-2010 10-Aug-2010 30-Jun-2013 31-Mar-2014 P085752 IDA-51720 Effective 23-Oct-2012 11-Dec-2012 18-Jan-2013 31-Mar-2014 31-Dec-2014 Disbursements (in Millions) % Cancelle Disburse Undisbur Project Ln/Cr/TF Status Currency Original Revised Disburse d d sed d iii P085752 IDA-41920 Closed XDR 61.60 57.70 3.90 57.70 0.00 100 P085752 IDA-46390 Closed XDR 20.20 19.14 1.06 19.14 0.00 100 P085752 IDA-47400 Closed XDR 23.10 22.65 0.45 22.65 0.00 100 P085752 IDA-51720 Effective XDR 19.80 19.80 0.00 9.14 10.66 46 Policy Waivers Does the project depart from the CAS in content or in other significant Yes [ ] No [ X ] respects? Does the project require any policy waiver(s)? Yes [ ] No [ X ] A. Summary of Proposed Changes The Government of Tanzania has requested for a twelve (12) months extension of closing date for the third additional financing (Credit 51720) from December 31, 2014 to December 31, 2015. B. Project Status The project implementation progress is moderately satisfactory and progress toward achieving PDO is moderately satisfactory. C. Proposed Changes The project is scheduled to close on December, 31, 2014. It is proposed to extend the closing date for the third AF (Credit 51720) from December 31, 2014 to December 31, 2015 to support transitional activities to the next phase of the project (ASDP2) which is currently under preparation. The project will support implementation of Government priorities under the Big Results Now (BRN). iv TANZANIA – AGRICULTURE SECTOR DEVELOPMENT PROJECT (Cr. 51720 - TA) RESTRUCTURING PAPER A. PROJECT SUMMARY 1. This Restructuring Paper seeks the approval of the Country Director for Twelve (12) months extension of closing date of the third Additional Financing (AF3) to the Agriculture Sector Development Project (Cr. 51720-TA) - from December 31, 2014 to December 31, 2015. 2. The ASDP supports a 15 year Government program implemented through a Sector Wide Approach (SWAp), financed by five Development Partners (DP) through a Basket Fund. The Project Development Objective (PDO) is to (i) enable farmers to have better access to and use of agricultural knowledge, technologies, marketing systems, and infrastructure; and (ii) promote agricultural private investment based on an improved regulatory and policy environment. 3. The original IDA Credit (Cr. 41920) for the project, in the amount of SDR 61.6 million (US$90 million equivalent) was approved by the Board on May 19, 2006, to support Government’s 15 year Sector Wide Program−with a first phase of seven years (2006/7-2012/13). Subsequently, the Board approved three IDA Additional Financing (AF) credits in the total amount of US$95 million (US$30 million – Cr. 4639-TA approved on May 27, 2009; US$35 million - Cr. 4740-TA approved on May 10, 2010; and US$30 million – Cr. 51720-TA approved on October 2, 2012). The original credit and the first two AFs (Cr. 41920-TA, Cr. 4639-TA, and Cr. 4740-TA) closed on March 31, 2014, while the third AF (Cr. 5172-TA) was extended to December 31, 2014 from the original closing date of March 2014. The Additional Financing (Cr. 51720-TA) in the amount of US$30 million is a “bridging finance” for ASDP activities before the funds from second phase comes on-stream. The AF was intended to sustain ongoing project activities; strengthen initial project successes and address key challenges and risks to realization of project objectives; and at the same contribute to the realization of government sector priorities defined in the Big Results Now (BRN) initiative.The AF was the sole financial of ASDP activities in FY 2013/14 as other donor funding were exhausted by June 2013. To date, only about US$14 million (46 percent) of the proceeds has been disbursed while US$16 million remains undisbursed. B. PROJECT STATUS 4. The project implementation progress and achievement of PDO are both rated Moderately Satisfactory (MS). Significant progress has been made in the implementation of bridging activities earmarked for the third additional financing of the ASDP. The AF has supported construction and improvement of various local infrastructures, particularly 1 rehabilitation/construction of irrigation facilities, markets and warehouses, in line with BRN initiative; construction of dip tanks, abattoirs and charcoal dams; and enhancing access to markets s and value addition through warehouse receipt system and improvement of rural roads. In addition, the project continued to strengthen sector wide approach in the agriculture sector, planning, budgeting through value chain approach; development of human and physical capacity, especially at local level; and enhancing financial oversight. The procurement management continues to improve, despite the challenges related to limited procurement capacity at local level and management of procurement plan at national level. C. PROPOSED CHANGES 5. The Government of Tanzania has requested an extension of the credit closing date from December 31, 2014 to December 31, 2015. The proposed extension is sought to support implementation of on-going transitional activities towards full Bank’s support to implementation of Government’s priorities identified under the Big Results Now (BRN) initiative, through the second phase of the project (ASDP2), which is under preparation. 6. During the extension period the remaining credit balance of US$16 million will be used to support implementation of preparatory activities, including testing the proposed implementation approaches, to allow smooth roll out of the implementation of the BRN initiative, under the ASDP2. The focus will be on activities to enhance smallholders access to maize markets through Collective Warehouse based Marketing (COWABAMA) schemes; and professionally managed irrigation schemes. 7. This is a request for extension of closing date only, no other changes are requested. 2