Document of The World Bank FOR OFFICIAL USE ONLY Report No: 54971-BO PROJECT APPRAISAL DOCUMENT FOR A PROPOSED CREDIT IN THE AMOUNT OF SDR 31.9 MILLION (US$50 MILLION EQUIVALENT) TO THE PLURINATIONAL STATE OF BOLIVIA FOR STRENGTHENING STATISTICAL CAPACITY AND THE INFORMATIONAL BASE FOR EVIDENCE-BASED PLANNING PROJECT UNDER THE STATISTICAL CAPACITY BUILDING (STATCAP) ADAPTABLE PROGRAM LENDING (APL) December 10, 2010 Poverty Reduction and Economic Management Sector Management Unit Bolivia, Chile, Ecuador, Peru, and Venezuela Country Management Unit Latin America and the Caribbean Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Currency Equivalents (Exchange Rate Effective June 21, 2010) Currency Unit = Boliviano (BOB$) BOB$1 = US$0.1424 US$1 = BOB$7.02 PLURINATIONAL STATE OF BOLIVIA ­ FISCAL YEAR January 1 ­ December 31 ABREVIATIONS AND ACRONYMS APL Adaptable Program Loan CAS Country Assistance Strategy CNA Censo Nacional Agropecuario (National Agricultural Census) CNPV Censo Nacional de Población y Vivienda (National Population and Housing Census) CPE Constitución Política del Estado (State Political Constitution) CUT Cuenta Única de Tesoro (Single Treasury Account) DA Designated Account DAS Dirección de Administración y Servicios (Administration and Services Directorate) ECH Encuesta Continua de Hogares FA Financing Agreement FAO United Nations Food and Agriculture Organization (Organización de las Naciones Unidas para la Agricultura y la Alimentación) FM Financial Management FMA Financial Management Assessment GDP Gross Domestic Product GOB Government of Bolivia GRUS Group of Partners for the Development of Bolivia ICB International Competitive Bidding IDA International Development Association (Asociación Internacional de Fomento) IDB Inter-American Development Bank (Banco Interamericano de Desarollo) IFR Interim Financial Reports IHS Integrated Household Survey INE Instituto Nacional de Estadística (National Statistics Institute) ISN Interim Strategy Note IT Information Technologies LCR Latin America and the Caribbean Region M&E Monitoring and Evaluation MDG Millennium Development Goals MECOVI Programa para el Mejoramiento de las Encuestas y la Medición de Condiciones de Vida (Program for the Improvement of Surveys and the Measurement of Living Conditions) MDRI Multilateral Debt Relief Initiative MFDR Managing for Development Results ii MPD Ministerio de Planificación del Desarrollo (Ministry of Development Planning) NAC National Agricultural Census NCB National Competitive Bidding NGO Non-Governmental Organization NLTA Non-Lending Technical Assistance NPHC National Population and Housing Census OM Operational Manual PEI Plan Estratégico Institucional (Institutional Strategic Plan) PENDES Plan Estratégico Nacional para el Desarrollo Estadístico (National Strategic Plan for Statistical Development) PFMP Public Financial Management Project PND Plan Nacional de Desarrollo (National Development Plan) OECD Organization for Economic Co-operation and Development (Organización para la Cooperación y Desarrollo Económico) RBM Results-Based Management RFP Request for Proposals SBD Standard Bidding Documents SIGMA Sistema Integrado de Gestión y Modernización Administrativa (Integrated Management and Administrative Modernization System) SISPLAN Sistema Nacional de Planificación (National Planning System) SNIE Sistema Nacional de Información Estadística (National System of Statistical Information) SPIEP Sistema de Planificación Integral del Estado Plurinacional (Comprehensive Planning System of the Plurinational State) SOE Statement of Expenditures STATCAP Statistical Capacity Building TAL Technical Assistance Loan TOR Terms of Reference TSD Team for Statistical Development UDAPE Unidad de Análisis de Políticas Sociales y Económicas (Social Policy and Economic Analysis Unit) UNDP United Nations Development Program (Programa de las Naciones Unidas para el Desarrollo) UNFPA United Nations Population Fund (Fondo de Población de las Naciones Unidas) UPA Unidad de Producción Agrícola (Agricultural and Livestock Production Unit) VIPFE Viceministerio de Inversión Pública y Financiamiento Externo (Vice-Ministry of Public Investment and External Financing) VMPC Viceministerio de Planificación y Coordinación (Vice-Ministry of Planning and Coordination) WB World Bank (Banco Mundial) iii Vice President: Pamela Cox Country Director: Carlos Felipe Jaramillo Country Manager: Oscar Avalle Sector Leader: Carlos Silva-Jáuregui Sector Manager: Louise Cord STATCAP Program Manager: Grant Cameron Co- Task Team Leaders: Samuel Freije-Rodríguez and Indu John- Abraham iv PLURINATIONAL STATE OF BOLIVIA STRENGTHENING STATISTICAL CAPACITY AND THE INFORMATIONAL BASE FOR EVIDENCE-BASED PLANNING Table of Contents I. STRATEGIC CONTEXT AND RATIONALE .......................................................................... 1 A. Country and sector issues ....................................................................................................... 1 B. Rationale for Bank Involvement ............................................................................................ 3 C. Higher level objectives to which the project contributes ....................................................... 4 II. PROJECT DESCRIPTION ........................................................................................................ 5 A. Lending instrument ................................................................................................................ 5 B. Project development objective and key indicators ................................................................. 6 C. Project components ................................................................................................................ 7 D. Lessons learned and reflected in the project design ............................................................... 9 E. Alternatives considered and reasons for rejection .................................................................. 9 III. IMPLEMENTATION ............................................................................................................. 10 A. Institutional and implementation arrangements ................................................................... 10 B. Monitoring and evaluation of outcomes/results ................................................................... 10 C. Sustainability ........................................................................................................................ 11 D. Critical risks and possible controversial aspects .................................................................. 11 E. Loan/credit conditions and covenants .................................................................................. 13 IV. APPRAISAL SUMMARY ..................................................................................................... 13 A. Economic and financial analyses ......................................................................................... 13 B. Technical .............................................................................................................................. 14 C. Fiduciary............................................................................................................................... 15 D. Social .................................................................................................................................... 16 E. Environment ......................................................................................................................... 17 F. Safeguard policies ................................................................................................................. 17 G. Policy Exceptions and Readiness ......................................................................................... 18 Annex 1: Country and Sector or Program Background ................................................................ 20 v Annex 2: Major Related Projects Financed by the Bank and/or other Agencies.......................... 24 Annex 3: Results Framework and Monitoring.............................................................................. 26 Annex 4: Detailed Project Description ......................................................................................... 31 Annex 5: Project Costs.................................................................................................................. 41 Annex 6: Implementation Arrangements ...................................................................................... 42 Annex 7: Financial Management and Disbursement Arrangements ............................................ 43 Annex 8: Procurement Arrangements ........................................................................................... 53 Annex 9: Economic and Financial Analysis ................................................................................. 63 Annex 10: Safeguard Policy Issues............................................................................................... 65 Annex 11: Project Preparation and Supervision ........................................................................... 67 Annex 12: Documents in the Project File ..................................................................................... 69 Annex 13: Bolivia Statement of Loans and Credits...................................................................... 70 Annex 14: Country at a Glance ..................................................................................................... 72 Annex 15: Bolivia Map IBRD 33741 ........................................................................................... 74 vi DATA SHEET Plurinational State of Bolivia Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning PROJECT APPRAISAL DOCUMENT Latin America and the Caribbean Poverty Reduction and Gender Unit - LCSPP Date: December 10, 2010 Sector(s): General Public Administration Sector (100%) Country Director: Carlos Felipe Jaramillo Theme(s): Other Economic Management Sector Director: Marcelo Giugale (100%) Sector Manager: Louise Cord EA Category: Not required Team Leader(s): Samuel Freije-Rodríguez and Indu John-Abraham Project ID: P101336 Lending Instrument: Horizontal Adaptable Program Loan (APL-STATCAP) Project Financing Data: Proposed terms: The credit has a final maturity of 20 years including a grace period of 10 years. [ ] Loan [ X ] Credit [ ] Grant [ ] Guarantee [ ] Other: Source Total Amount (US$M) vii Total Project Cost: US$ 56.1 million Cofinancing: Other donors US$ .5 million Borrower: Plurinational State of US$ 5.6 million Bolivia Total Bank Financing: US$ 50.0 million IBRD IDA US$ 50.0 million New Recommitted Borrower: Plurinational State of Bolivia Responsible Agency: National Statistical Institute (Instituto Nacional de Estadísticas, INE) Contact Person: Mr. Ramiro Guerra Beltran, General Executive Director Telephone No.: +(591-2) 222-2333 Fax No.: +(591-2) 222-2693 Email: rguerra@ine.gob.bo Estimated Disbursements (Bank FY/US$ m) FY FY2011 FY2012 FY2013 FY2014 Annual 5.9 40.2 3.8 0.1 Cumulative 5.9 46.1 49.9 50.0 Project Implementation Period: 3 years Expected effectiveness date: March 1, 2011 Expected closing date: June 15, 2014 Does the project depart from the CAS in content or other Yes No significant respects? viii If yes, please explain: Does the project require any exceptions from Bank policies? Yes No Have these been approved/endorsed (as appropriate by Bank Yes No management? Is approval for any policy exception sought from the Board? Yes No If yes, please explain: Does the project meet the Regional criteria for readiness for Yes No implementation? If no, please explain: Project Development objective: The project development objective is to strengthen the statistical capacity and improve the informational base of the Recipient, in order to provide quality information, as defined by its reliability, timeliness, accuracy and representativeness with the level of disaggregation necessary to support systems for planning, designing, monitoring and evaluating public programs and policies. Project description [one-sentence summary of each component] Component 1: Updating of the Multi-Purpose Cartography (US$14.8 million): The provision of support in relation to the modernization of the multi-purpose cartography in the Recipient's territory including, in connection therewith,: (i) the update of the cartography of the Recipient's territory; and (ii) the integration of the updated cartographic material into the Recipient's geographic information system. Component 2: National Agricultural Census (US$13.2 million): The carrying out of pre- census, census and post-census activities in the context of the Recipient's national agricultural and livestock census. Component 3: National Population and Housing Census (US$20.6 million): The carrying out of pre-census, census and post-census activities in the context of the Recipient's National Population and Housing Census. Component 4: Continuous Household Survey (US$1.4 million): The provision of support to: (i) develop a new methodology that would maintain the comparability with previous surveys in the Recipient's territory; (ii) expand the sample size to be representative of the departments and the largest cities in the Recipient's territory; and (iii) collect and process the information of the survey. ix Safeguard policies triggered? Environmental Assessment (OP/BP 4.01) Yes No Natural Habitats (OP/BP 4.04) Yes No Forests (OP/BP 4.36) Yes No Pest Management (OP 4.09) Yes No Physical Cultural Resources (OP/BP 4.11) Yes No Indigenous Peoples (OP/BP 4.10) Yes No Involuntary Resettlement (OP/BP 4.12) Yes No Safety of Dams (OP/BP 4.37) Yes No Projects on International Waters (OP/BP 7.50) Yes No Projects in Disputed Areas (OP/BP 7.60) Yes No Conditions and Legal Covenants: Financing Agreement Description of Date Due Reference Condition/Covenant Article V, Section 5.01 The Subsidiary Agreement Effectiveness date (estimated shall have been executed on for March 1, 2011) behalf of the Recipient and INE x I. STRATEGIC CONTEXT AND RATIONALE A. Country and sector issues 1. Bolivia benefited from exceptional external conditions between 2006 and 2008, and was resilient to the recent global economic crisis. Between 2006 and 2008, GDP growth averaged 5.2 percent, while record current account and fiscal surpluses were reached due to high commodity prices and remittances, the operation of a major mining project, and higher hydrocarbon taxation. Bolivia maintained positive growth in 2009, despite the strong reduction of Brazilian gas demand due to the economic slowdown and high rainfalls in that country. GDP growth reached 3.4 percent in 2009 due to the recent commodity price recovery, growing mining exports and, to a lesser extent, higher fiscal expenditure. 2. The incumbent president was reelected in December 2008 after his administration continued a profound reform process in line with its National Development Plan (PND). Since President Morales was elected in 2005, a new constitution was approved that defined Bolivia as a Plurinational State with greater regional autonomy and a plural economy, in which the social, communal, state, and private economies should co-exist. In line with the PND, new social programs were implemented and others were scaled up, strategic enterprises were nationalized, and new public enterprises were created. These reforms have been well received by the population, allowing the President to be reelected in the December 2009 election with broad support, and allowing the ruling party to gain control in the Plurinational Assembly. However, some independent local leaders won key municipalities, and three departments were won by regional opposition figures in the April 2010 local and regional elections, respectively. 3. The PND should be understood within the new context of the mandates under the 2009 Constitution (Constitución Política del Estado, or CPE). As mentioned above, the new Constitution defines Bolivia as a Plurinational Communal State with Autonomies. The principle that guides the Constitution is "Living Well" (Vivir Bien), which acknowledges the importance of material and economic progress in attaining higher levels of well-being, but recognizes that they are not sufficient to satisfy communal needs. The PND places great emphasis on deepening decentralization through the construction and strengthening of local autonomies. 4. The structure of Bolivia's public administration was reorganized in order to respond to the mandates of the PND. The Ministry of Development Planning (MPD) was created in 2006 as part of an effort to strengthen the planning systems in the country, which includes policy design and monitoring and evaluation (M&E). The MPD replaced the Ministry of Sustainable Development with the mandate to coordinate the planning system and the national system of public investment, as well as the M&E of the PND. The MPD is responsible for the preparation of quarterly reports to the President on the status of the implementation of the PND. In doing so, the MPD coordinates and consolidates information from 24 sectors, and ideally would provide the technical assistance and capacity building to sector ministries needed to follow through effectively on the implementation of the PND. 5. The new political structure of Bolivia necessitates greater disaggregation of information to facilitate decentralized governance. The new constitution places greater authority, and with it greater resources and responsibilities, at the local level. The last population 1 census was conducted in 2001, under a dramatically different political, social, and economic context in the country, which greatly limits the quality of statistical information currently available on which critical policy decisions are made. Consequently, there is a pressing demand to obtain updated data regarding the social, economic and demographic information in the country in order to appropriate public resources accordingly. 6. The challenges of coordination among the Ministries and the obligations of Government are further complicated by the lack of an adequate statistical information base. Information is the foundation of any planning system, as well as the M&E systems of public programs and policies. Moreover, information is a fundamental input in the allocation of resources across regions, across the different levels of government, and across sectoral ministries. The lack of a reliable base of statistical information in Bolivia fragments the cycle of policy formulation, as the M&E systems do not have sufficiently reliable and timely information to serve as an input in the decision-making process. Accordingly, the current system of monitoring and accountability of the PND is limited and generates a low level of satisfaction among key actors. 7. In response, the Government of Bolivia seeks to strengthen the statistical capacity and the informational base to serve as an input to the design, monitoring and evaluation of evidence-based policies and programs. This project will provide technical and financial assistance to the GOB to strengthen its statistical capacity and informational base. In particular, the project will support four key operations of the National System of Statistical Information (SNIE), through: (i) the updating of the multi-purpose cartography; (ii) the design, implementation, processing and dissemination of the National Agricultural Census; (iii) the design, implementation, processing and dissemination of the National Population and Housing Census; and (iv) the redesign of the sampling frame and the expansion of the sample size of the Continuous Household Survey in order to produce statistics that are representative at the departmental level and for the four major urban areas. 8. The National Statistics Institute (INE) of Bolivia is the governing body of the SNIE, and has the mandate to produce the most accurate and updated information for decision- making. Since its creation in 1970, INE has been the main producer of the country's statistical information through the collection, processing and dissemination of the national population and housing, economic, and agricultural censuses, in addition to countless statistical operations that allow Bolivians to better understand their socio-economic reality. As the rector agency of the SNIE, INE coordinates the interaction among a group of public and private institutions, which are the main producers and users of information in Bolivia. The SNIE accomplishes its mission by establishing and implementing technical standards, methodologies, and other operational procedures for the production of statistical information. 9. The project intends to strengthen the statistical capacity and informational base of Bolivia in order to support better systems for the planning, design, monitoring and evaluation of public policies and programs at all levels. In doing so, the project will contribute directly to more timely, accurate and reliable inputs into the planning, design, monitoring and evaluation of policies, which will result in more effective systems for evidence-based policy- making. Given the public good nature of statistical information, the benefits of improved 2 statistical capacity and information will not be limited to the implementation and M&E of the PND, but will likely spread to all ministries and multiple government policies and programs. 10. The information to be collected through the National Population and Housing Census and the National Agricultural Census will provide fundamental inputs for the implementation of many of the mandates of the new State Political Constitution (CPE), most notably for the decentralization process, and will also support several of the PND priority programs. The decentralization process initiated by the CPE requires that resources be allocated across the different levels of government, namely, the national, departmental, municipal, and native indigenous peasant communities. The allocation of resources is typically based on population size as well as on the social and economic characteristics of the sub-national units. Given that the last population and housing census was collected in 2001, the formulas used to allocate resources are outdated. Thus, there is an urgent need to collect information to determine a more accurate distribution of resources based on the new demographic and political landscape of the country. The National Population and Housing Census will provide this updated information base. Moreover, several priorities under the PND require updated information, much of which will be provided by the National Population and Housing Census and by the National Agricultural Census, as well as by the redesigned Continuous Household Survey. B. Rationale for Bank Involvement 11. The World Bank is a leader in the Latin America and Caribbean region in strengthening National Statistical Systems and in promoting results-based management for development, so it is well positioned to respond to the demands for specific assistance in these areas from the Government of Bolivia. The World Bank has been a pioneer in Latin America and the Caribbean in providing technical and financial assistance to countries to strengthen their national statistical systems. Through the Team for Statistical Development (TSD), the Bank to date has accompanied thirteen countries in the region in the formulation and implementation of their National Strategic Plans for Statistical Development (PENDES), including Bolivia. In addition, the Bank also administers the Regional Award for Innovation in Statistics in Latin America and the Caribbean, which facilitates the exchange of best practices and state-of-the-art experiences in statistical development among professionals in the region. With the strengthening of their national statistical capacity, these countries establish solid foundations to facilitate the planning and formulation of evidence-based policies. 12. The international donor community is organizing its support around the PND. The Group of Partners for the Development of Bolivia (GruS) is the principal mechanism for harmonization between aid agencies in Bolivia. Its objective is to support the Government-Donor dialogue through roundtables in order to improve aid effectiveness and promote alignment in pursuit of the objectives of the PND and the Millennium Development Goals (MDGs). Given the priority assigned to the PND by the GOB, the international donor community has been working to coordinate its support for the implementation of the PND. The formal coordination mechanism with the GOB is through the Coordination Tables (Mesas de Coordinación). Since 2006, the Government has organized five Mesas to discuss sector plans and the implementation of the PND. The World Bank is leading, along with the Government of the Netherlands, the Mesa Bolivia Digna, which deals with social sector issues, including the Social Protection and 3 Integrated Community Development Strategy. The GruS has worked to elaborate data on donor operations in fourteen sectors. This effort envisages, amongst other things, the establishment of leading donors in each sector according to their comparative and competitive advantages, donors focusing on no more than three sectors, and delegated cooperation. 13. The World Bank is providing complementary support for poverty reduction through evidence-based decision-making. A non-lending technical assistance (NLTA) is currently underway to support the development of a methodology to operationalize the concept of "Vivir Bien", as a multidimensional concept of wellbeing, as well as to assess the methodologies used to construct estimates of monetary and multidimentional poverty measures. The NLTA is closely linked to this operation as it further supports the information base for results-based management. Likewise, a grant through the Trust Fund for Statistical Capacity Building has been approved for Bolivia to support the institutional capacity of the INE to effectively conduct the tasks presented under this operation. In addition to those projects currently active, it is anticipated that additional activities will be pursued through NLTA and trust funds to further complement the objectives planned under this project. C. Higher level objectives to which the project contributes 14. Through the strengthening of the statistical capacity and the improvement of the informational base of the country, this project will provide essential inputs for planning, designing, monitoring and evaluating public programs and policies, which will result in greater transparency and accountability and a more effective strategy for the reduction of poverty, inequality and social exclusion. This project will contribute to strengthening the statistical capacity of INE and other members of the National System for Statistical Information by improving the informational base in Bolivia. In doing so, the project provides the basis to strengthen governance through evidence-based decision making for results-based management. This will allow future work in several areas, including the development of a national monitoring and evaluation system, the updating of the formulas used to determine per capita transfers to subnational governments, performance-based public sector management, and improved accountability. By supporting the improved quality of statistical information, the project will contribute to laying a solid foundation for planning, design, monitoring and evaluation of public programs and policies. 15. The project will contribute to achieve four of the goals set by the PND and the new CPE. In particular, the project will help achieve the following: (i) greater transparency and accountability through more and better information, as part of pillar Bolivia Democrática; (ii) accelerate the process of decentralization ordered under the new CPE, which requires that the country have representative statistics for ever more disaggregated geographical levels, so that all government entities have the necessary information for planning; (iii) implement the objectives of the Comprehensive Planning System of the Plurinational State (SPIEP) and the process of design, implementation, monitoring and evaluation of the public programs and policy priorities, which generates significant additional demand for quality statistical information; and, (iv) eradicate social exclusion and strengthen the role of women and native indigenous populations in the construction of the new vision of the Plurinational State, which requires better statistical information for the formulation of the strategy for reducing poverty and inequality. 4 16. This project is central to Pillar Four of the World Bank Group's Interim Strategy Note (ISN) for Bolivia for FY2010-2011 (Report No. 48372-BO) discussed by the Executive Directors on June 2, 2009. The main objectives of this pillar, Governance and Support to the Public Sector, are to improve the design, monitoring and evaluation of public programs for the effective implementation of the PND, to strengthen public sector management for better services delivery and increased inclusion, and to strengthen the public financial management and procurement framework to improve transparency and accountability. As outlined in the ISN, Bolivia faces three critical governance challenges: (i) inequities and limited access to services; (ii) weak accountability, both vertically (within the administration) and horizontally (vis-à-vis the citizens); and (iii) limited institutional capacity. With regards to the first challenge, public revenues are unequally distributed across departments and municipalities, and unequal access to services by citizens of different social backgrounds or geographical location continues to severely limit inclusion. The second challenge is reflected by the lack of oversight and transparency mechanisms in the provision of public services, both within the Government itself, as well as social accountability mechanisms through civil society. With regards to the third challenge, the public sector has limited capacity to establish priorities, design, coordinate, and implement programs and public services, due in part to limited monitoring and evaluations systems, high staff turnover, low public salaries, and a process to hire public servants that is not entirely merit based. 17. The National Strategic Plans for Statistical Development (PENDES) identified priority areas for intervention in order to strengthen the SNIE. The four statistical operations specified under this project constitute strategic priorities highlighted under the PENDES. More specifically, the PENDES specified the need for updated cartographic information that provided for greater disaggregation and representative sampling. Likewise, it emphasized the importance of the census operations, including the agricultural, population and housing, and the economic censuses, particularly for the definition of socio-economic indicators, and as the basis for the national, departmental, municipal and sectoral development plans. Finally, the household survey is highlighted in terms of the need to update the conceptual frameworks and sampling frame in order to produce more accurate socio-economic data on a more consistent basis. As such, this operation represents a clear step forward, which explicitly responds to the client's demands and main concerns, to strengthen the foundations of the SNIE, which in turn will serve as the informational base for decision-making in this new decentralized Bolivia. II. PROJECT DESCRIPTION A. Lending instrument 18. The lending instrument is a Horizontal Adaptable Program Loan (APL) under the Statistical Capacity Building Program (STATCAP) facility, which aims to improve the production and use of information for evidence-based policymaking. The STATCAP offers a sector-wide approach to a number of countries to improve statistical capacity for evidence-based policymaking. Specific loans and credits obtained by borrower countries are treated as phases of the Adaptable Program Credit under the STATCAP approach. The STATCAP was approved as a Horizontal APL by the World Bank's Board in March 2004. A STATCAP project is appraised 5 and prepared for approval at the Regional Vice President level following normal provisions for investment lending. A Horizontal APL is an appropriate lending instrument to share the knowledge that the World Bank has accumulated by working with its partner countries in the production and use of information for better policymaking. 19. The proposed project meets the eligibility criteria set forth by STATCAP. To access the STATCAP lending facility, borrowers need to fulfill the following eligibility criteria: (i) preparation of a national statistical development strategy and statistical master plan; (ii) strong national commitment and leadership; (iii) willingness to comply with good statistical practice; (iv) participation in global development and monitoring activities; and (v) use of sustainable financial and institutional arrangements. Since 2006, the GOB has been engaged in efforts to build a better evidence-based policymaking system around the PND, which makes the GOB eligible to enter the STATCAP lending program. In particular, from the perspective of information production, the National Statistics Institute (INE) has been leading the development of a National Strategic Plan for Statistical Development (PENDES) in order to ensure the statistical information requirements emerging from the PND are met with quality, timely, efficient, and properly disseminated statistical products. It is important to note that INE will be the only executing agency under this STATCAP operation. B. Project development objective and key indicators 20. The project development objective is to strengthen the statistical capacity and improve the informational base of the Recipient, in order to provide quality information, as defined by its reliability, timeliness, accuracy and representativeness with the level of disaggregation necessary to support systems for planning, designing, monitoring and evaluating public programs and policies. 21. In particular, the project will strengthen the INE through the support of the following four statistical operations: (a) Updating of the Multi-Purpose Cartography (b) National Agricultural Census (c) National Population and Housing Census (d) Continuous Household Survey 22. Key performance indicators for tracking progress towards achieving the project's development objective are listed below and detailed in Annex 3. (a) Updating of the Multi-Purpose Cartography: the collection of data needed for the updating of the multi-purpose cartography, which will allow the collection of the two censuses, the construction of the new sampling master frame for the continuous household survey, as well as a number of applications of the geo-referenced data collected. (b) National Agricultural Census: (i) the completion of the design of the instrument and related materials (manuals, catalogues, etc.); (ii) the completion of all pilot testing and the 6 experimental census before the start of the field work; (iii) the development of training manuals and materials for supervisors and interviewers to provide timely training before the start of the field work; (iv) the implementation of trainings of supervisors and interviewers; (v) the collection and processing of data; and (vi) dissemination of the processed information of the data collected. (c) National Population and Housing Census: (i) completion of the design of the questionnaire and related instruments (manuals, catalogues, etc.); (ii) completion of all pilot testing and the experimental census before the start of the field work; (iii) the development of training manuals and materials for supervisors and interviewers to provide timely training before the start of the field work; (iv) the implementation of trainings of supervisors and interviewers; (v) the collection and processing of data; (vi) the dissemination of the processed information of the data collected. (d) Continuous Household Survey (ECH): (i) completion of the redesigned sampling frame and expanded sample size for the collection of the ECH, based on the updated cartography; (ii) completion of the redesigned ECH questionnaire; (iii) completion of the pilot test using the redesigned sampling frame, the expanded sample size and the redesigned questionnaire; (iv) completion of data collection in the field; (v) completion of the processing of the data; and (vi) completion of the dissemination of the results. C. Project components 23. This project has four components related in large measure with INE's Strategic Institutional Plan (PEI) objective of strengthening the production and dissemination of the official statistics, namely to provide support to: (i) updating of the multi-purpose cartography; (ii) design and implementation of all stages of the National Agricultural Census; (iii) design and implementation of all phases of the National Population and Housing Census; and (iv) redesign the sampling frame and expand the sample size of the Continuous Household Survey in order to extend its representativeness to the departmental level and to the four main urban areas. These components were selected jointly by the Ministry of Development Planning, INE and the World Bank, since these operations are considered fundamental to the National System for Statistical Information, in addition to their use as inputs for the planning systems and the systems for monitoring and evaluation of priority public programs and policies as identified by the PND. Component 1: Updating of the Multi-Purpose Cartography (US$14.8 million) 24. This component seeks the modernization of the multi-purpose cartography in the Recipient's territory, including: (i) the update of the cartography of the Recipient's territory; and (ii) the integration of the updated cartographic material into the Recipient's geographic information system. The multi-purpose aspect of the cartography allows for the concurrent collection of information on observation units related to population and housing, agricultural, and economic establishments censuses. In addition, it captures information on the specific characteristics of community organization (hospitals, schools, unions, etc.) that will allow for the design of statistical sample frames for several sectors (health, education, services, etc.). Component 2: National Agricultural Census (US$13.2 million) 7 25. Accounting for 13.5 percent of the Gross Domestic Product (GDP) and an average annual growth rate of 3 percent between 2005 and 2009, the agricultural sector clearly plays an important role in the national economy of Bolivia as one of the main economic activities of the country. The last agricultural census was conducted in 1984; consequently, the information is very outdated and can no longer be relied upon for policy decision-making for the sector. The Bolivian Government is now planning to institute an agricultural insurance program in the short- term, for which the agricultural census will be the primary input. This component will finance the activities of the National Agricultural Census (NAC), including the collection of information from the agricultural, livestock, forestry and aquaculture establishments from all the municipalities in the country. More specifically, this component seeks to carry out pre-census, census and post-census activities in the context of the Recipient's national agricultural and livestock census, including the provision of support relevant to: (i) Pre-census: develop a list of Agricultural and Livestock Production Units (UPAs) at the municipal level, and conduct a pilot census to test and adjust the instruments to be used in the main census; (ii) Census: collect information on UPAs through internationally recognized instruments, techniques, methods and standards adapted to the Recipient's own context; and (iii) Post-census: disseminate the processed information of the data collected. Component 3: National Population and Housing Census (US$20.6 million) 26. A National Population and Housing Census seeks to provide updated information on the demographic, social, economic and housing conditions existing in the country in order to adjust and define plans, programs and policies and strategies for the implementation and evaluation of sustainable human, economic and social development at the national, departmental or municipal levels. This information is particularly critical for the GOB at this juncture in Bolivia with the transition towards a decentralized, regionally autonomous political structure. The census will serve as one of the critical inputs in defining resource allocations among the various political units. This component of the project will carry out pre-census, census and post-census activities in the context of the Recipient's National Population and Housing Census (NPHC). In particular, the component will provide support to: (i) Pre-census: (a) develop the census instrument for the collection of demographic information, according to the conditions of the country, the history of their indicators and institutional arrangements within the Government; (b) prepare training materials and carry out trainings for the operational staff in charge of census activities (interviewers, supervisors, clerical staff); (c) elaborate dissemination materials that will be used to promote the participation of the population in this data collection exercise; (d) develop a pilot census and experimental censuses to test and adjust accordingly the material to be used in the main census; (ii) Census: collect and process the census data; and, (iii) Post-census: disseminate the processed information of the data collected by the census. Component 4: Continuous Household Survey (US$1.4 million) 27. The representativeness of the continuous household survey has been limited to the four principal cities and in some periods extending to eight principal cities, depending on the available financing. Due to the importance of the information gathered from the continuous household survey, INE initiated studies to broaden its coverage from 1996. Currently, the survey is representative at the national level, and is stratified by population size, urban-rural and 8 poverty. However, its representativeness is not sufficient to respond to the new realities of the country, with its new Constitution and the new territorial organization. This component will provide support to: (i) develop a new methodology that would maintain the comparability with previous surveys in the Recipient's territory; (ii) expand the sample size to be representative of the departments and the largest cities in the Recipient's territory; and (iii) collect and process the information of the survey. D. Lessons learned and reflected in the project design 28. The following main lessons learned from previous experience in Bank projects have been considered in the preparation of the proposed project: (a) There is often a disconnection between producers and users of statistics that constrains the capabilities of the policymaking process. In order to help solve this problem in Bolivia, the INE has been leading since 2006 the preparation of a participatory National Strategic Plan for Statistical Development (PENDES) that aims to increase the coordination of producers and users of statistics, mainly around the needs of the PND. This process has facilitated the INE's role as rector agency of the SNIE. (b) Following the request of the GOB, and in line with the recommendations of the peer reviewers during Bank appraisal, the project has been greatly simplified from its previous version by focusing exclusively on the statistical capacity and informational base component. Given the high turnover in the Bolivian Government, the team expects that this simplification of the project will facilitate its successful implementation. E. Alternatives considered and reasons for rejection 29. The project was initially envisioned as a planning and M&E systems strengthening project with two implementing agencies, INE and MPD. INE would provide the informational base for the planning and M&E systems, while MPD would be responsible for the development and implementation of planning and M&E systems to support the implementation of the PND. During Bank appraisal, the team was advised to further simplify the project in order to produce more tangible development results with a greater chance of success. Consequently, the project team, with the full support of the GOB, specifically the MPD, adjusted the project to focus exclusively on the strengthening of the statistical capacity and informational base, with INE as the sole executing agency. In doing so, the project is able to concentrate on key priorities for the Government, while limiting the risks of implementation when dealing with multiple agencies. For more details on the change in project design, and the linked Project Preparation Facility (PPF), please see Annex 11 ­ Project Preparation and Supervision. 30. Another alternative considered by the Government was the strengthening of administrative records. A proposal for financing the strengthening of administrative records was presented to ensure the quality of data with the certification of processes, adequate documentation of metadata, and redesign of records already collected to facilitate the elaboration of statistics. This proposal was rejected because the Government's priorities are focused on the agricultural and population and housing censuses. In addition, it was suggested that additional financing may be obtained either through trust funds or other donors to support these initiatives. 9 III. IMPLEMENTATION A. Institutional and implementation arrangements 31. The National Statistics Institute (INE) will be the executing agency of this STATCAP credit. As the rector agency of the National Statistical System, INE will be responsible for managing this statistics operation. INE is a well-established entity with the competence and experience necessary for carrying out the activities under the proposed project. Accordingly, INE has put in place acceptable internal processes and procedures, including internal controls, which have allowed them to prepare and provide timely and reliable information for monitoring purposes. 32. Taking into account the considerable increase in INE's activities resulting from project implementation, there is a need to adequately strengthen INE's current capacity both in terms of its technical and fiduciary staff, as well as processes and procedures in order to make sure they fully respond to project needs allowing timely, agile, and smooth project implementation. To this end, INE has informed the World Bank of its decision to establish a Technical Coordination Unit responsible for the census under the General Coordination Directorate, and an Administrative Coordination unit within the Administration and Services Directorate for which detailed organizational and operational arrangements, both within INE and in terms of its relation with the rest of the structure, have been defined and reviewed with relevant World Bank specialists. In particular, detailed roles and responsibilities to assign financial management and procurement functions required by the project to this Administrative Coordination unit vis-à-vis INE's Dirección de Administración y Servicios have been defined, reviewed, and formalized. 33. Both the administrative and technical units of INE will be strengthened to meet the needs of the project. This will include additional personnel, specific technical trainings, and trainings on the fiduciary responsibilities under the project, among others. A Project Operational Manual (OM) has been developed to define responsibilities and operational procedures among the participating units. While an autonomous entity within the Government, INE is under the purview of the Ministry of Development Planning (MPD). Given its dependence on the MPD, INE will maintain the MPD informed of the progress of activities under the project, sharing implementation status and financial reports, in addition to other reports or methods of communication defined between the INE and MPD. B. Monitoring and evaluation of outcomes/results 34. INE is committed to monitoring and evaluating the results of the project. This project will finance several fundamental inputs to the country's informational base, which will also be central elements in strengthening evidence-based planning and decision-making to support the implementation of the PND. Given the focus of the project on statistical capacity building, the project indicators will follow the same rigor expected of the statistical operations themselves. There will be a strong emphasis on data quality, completeness and clarity in the reporting that will be carefully reviewed by INE as well as by the Bank. 10 35. Reports on the outputs or results of the project will require strengthened capacity of INE. Project management capacity in INE will be strengthened under the project through the support for project coordination and dissemination. Therefore, no separate cost for institutional capacity building is specified. C. Sustainability 36. There are five elements that clearly demonstrate the GOB's commitment and ownership of this project. Specifically, the GOB is focused on the strengthening the informational base to support its planning and M&E systems, as reflected by: (i) the high level of Government commitment to institutionalize the Plurinational State Integrated Planning System (SPIEP); (ii) the constitutional mandate to produce a National Development Plan (PND), and regular reports on its implementation; (iii) the GOB's own efforts to improve the design, monitoring and evaluation of public programs and the quarterly reporting on the advancement of these programs to the President; (iv) the participatory processes, headed by INE, since 2006 to develop the National Strategic Plan for Statistical Development (PENDES) in order to ensure the statistical information needs emerging from the PND are met with quality, timely, efficient, and properly disseminated statistical products; (v) the GOB, through the Ministry of Development Planning and INE, has been involved in the preparation of this project since the identification stage; and, (vi) the public announcements in the media by the GOB in preparation for the National Agricultural Census as well as the National Population and Housing Census. D. Critical risks and possible controversial aspects 37. The critical risks to the project's effective implementation, along with the risk mitigation measures proposed, are listed in the following table. Risk (*) Risks to project development Rating Proposed Risk Mitigation Measures objectives with Mitigation The planning process for the multi-purpose cartography and Heavy rainfall and Bolivia's high the two censuses will take into consideration weather exposure to natural hazards could contingencies and other potential disruptions by designing a delay timely collection of census and robust logistic plan to minimize the risks to the timely survey data (approximately 38% of M collection of the data. An advance from the National the population and of GDP are in Treasury of Bolivia (TGN) will allow for key preparatory areas at risk from two or more activities to take place during the critical months prior to hazards). Board approval. The World Bank is complementing this strategic operation with related non-lending technical assistance to support Restriction in the hiring of international consultants and Bank staff in the international consultants to work on implementation of key activities. In addition, the needs of M both project preparation and international consultants can be satisfied by the implementation, as needed. complementary actions of other donors present in the country. 11 Risk (*) Risks to project development Rating Proposed Risk Mitigation Measures objectives with Mitigation Inadequate number of qualified professionals prevents full Each component under the project will include an aspect implementation and effective related to training, allowing for technical and administrative operation of financial management staff to gain the necessary skills to implement the new M arrangements, not only in relation to methodologies. In addition, World Bank procurement and World Bank policies and procedures, financial specialists will regularly provide training to key but also in relation to local counterparts' personnel in the event of rotation. requirements. As part of the appraisal process, the Bank reviewed and agreed with INE on the formal establishment of the Lack of definition of roles and Administrative Coordination unit and within that: (a) responsibilities ­as well as detailed definition and confirmation of the structure of the proposed organizational structures and and its relationship with INE's Directorate of operational arrangements within S Administration and Services (Dirección de Administración INE's existing line units may delay y Servicios); (b) additional needs of FM staff within the project preparation and Administrative Coordination unit and at Regional Offices, implementation. as well as sources of financing; and (c) detailed processes and procedures for the operation of such structure. The corrective measures that are considered include: (i) a project operational manual prepared, including, inter alia, procurement and contracting procedures, will be adopted as a condition of effectiveness of the Financing Agreement; The overall project risk for (ii) INE will strengthen its procurement unit through hiring S procurement is high. and training of staff; (iii) the Financing Agreement will include additional provisions related to Particular Methods of Procurement; and, (iv) close monitoring by IDA, particularly during the first year of project implementation. General implementation arrangements and specific Financial Management (FM) arrangements have been agreed and confirmed with high-level authorities during INE lacks experience with World appraisal, to ensure commitment from both entities to M Bank financed projects. successfully complete the design and implementation of agreed FM arrangements resulting from the FM capacity assessments. In order to promote wide support for the project, a communication and awareness campaign will be Frequent changes of Government implemented, targeted to illustrate the benefits of priorities may delay project S compilation and analysis of information as the basis for a execution. sound evidence-based planning system to improve living conditions of the poor. The short timeline will increase the costs of the updating of The Government has requested that the cartography, which will need to be initiated prior to the both the Population and Housing rainy season. The Bank is fully committed to the project, Census and the National Agricultural but in order to conduct both censuses in the same year, it S Census be conducted concurrently in has requested that the Government delivers its counterpart order to complete both censuses contribution of US$5 million prior to the beginning of the within one year. rainy seassonin order to complete the cartographic updating 12 Risk (*) Risks to project development Rating Proposed Risk Mitigation Measures objectives with Mitigation prior to the minimum time needed to initiate census activities. The fact that the World Bank is supporting these statistical operations is, in itself, an assurance of the quality of the There may be reluctance to information to be collected and of the integrity with which participate in the censuses or even a data collection and processing processes will be conducted. boicot in some departments due to The World Bank and INE will work together in the design S political conflict and mistrust and implementation of a communications campaign that between the national government and will emphasize the importance of the information collected the subnational governments. and reassure the population of the integrity of the data collection and processing processes. Training based on the World Bank Anticorruption Guidelines to the executing units will be provided. In Systemic corruption persists despite addition, a close World Bank supervision of ex-ante and ex- M national and local efforts. post contracts will be undertaken. Overall risk rating S (*) Risk ratings: H (High), S (Substantial), M (Moderate), L (Low or negligible). E. Loan/credit conditions and covenants 38. There are no significant, non-standard loan conditions and covenants. IV. APPRAISAL SUMMARY A. Economic and financial analyses 39. The characteristics of this project do not lend themselves to the standard calculation of economic rate of return. The main objective of this project is to strengthen the GOB's statistical capacity for the production of timely, quality statistics at both the national and local levels, to be used for evidence-based planning. Given that the main objective is to improve the production and use of statistical information, the benefits from the project cannot easily be measured in monetary terms. However, investment in equipment and human resources associated with this project is expected to generate tangible economic benefits. First, the availability of data from the agricultural and population and housing censuses will serve as fundamental inputs for determining resource allocations across regions and levels of government, as well as for planning, designing, monitoring and evaluating public policies programs. This will help move the decentralization mandate of the CPE forward. Second, the improvements in the design and coverage of the continuous household survey will result in efficiency gains through its representativeness at the departmental level and higher quality statistical outputs for given levels of resources. Third, improved data availability will enhance the potential for evidence-based decision making at the policy, program and project levels. Fourth, the project will help address the significant costs of poor program management systems, such as low-effectiveness, low 13 coverage of service delivery, and duplication of activities, among others. In addition, the public goods nature of national statistics and of monitoring results for accountability and transparency provides a strong rationale for public involvement in the statistical and M&E sectors and the financing of these types of operations. 40. Despite the fact that the characteristics of the project make it difficult to assess its economic rate of return, this does not implies that it will not have significant social benefits. General Government final consumption expenditure as a share of GDP in Bolivia has been around 13.6 percent between 2000 and 2009. The transfers from the national government to the departmental and municipal governments are currently based on population projections dating back from 2001. Given the significant forecasting error typically associated with these population projections, it is very likely that government transfers are not being adequately allocated to subnational governments on a per capita basis. Considering the share of government expenditures in GDP, and the fact that over a decade has elapsed since the last population and housing census, the availability of updated data for the formulas to reflect the actual population will result in a more efficient and equitable allocation of public resources, which will constitute the main social benefit of the project. 41. The project is not amenable to standard financial analysis as national statistical and planning offices have very limited opportunities for significant cost recovery. Therefore, only marginal financial returns are expected from this project. However, there can be several fiscal impacts through savings generated by the GOB's increased ability to implement more effective programs. First, improvement in the design, collection and analysis of data will facilitate a more efficient budgeting process and public expenditure management. Second, greater use of administrative records for statistical purpose and streamlining of statistical operations would result in less labor-intensive statistical operations and potential savings in recurrent costs. Third, the allocation of government transfers to departments, municipalities, and native indigenous peasant communities based on actual (as opposed to projected) population data will result in a more efficient allocation of resources in general. The decentralization process envisioned by the CPE requires an increase in the transfer of resources on a per capita basis to more decentralized decision-making levels, so without updated and accurate data on population by locality this mandate will not be possible to implement efficiently. Fourth, the availability of reliable and credible statistical information is essential for the sustainability of the GOB's development agenda, which includes large agricultural irrigation and insurance programs, as well as for adequate targeting of public policies and programs, for results-based management and for the verification of results. B. Technical 42. The technical design of the project is based on an analysis of the strengths and weaknesses of the national statistical system as provided in the draft PENDES developed under the World Bank's assistance. The proposed additions and improvements to the Country's statistical capacity and information base, the training of INE's personnel in program management, the improvement in data quality and documentation of statistical operations and the choice of technology are appropriate to the borrower's needs and capabilities, as well as international good practice and standards. 14 43. The GOB has proven capable in the past of successfully organizing the massive and complex operations involved in the collection, processing and dissemination of both national Population and Housing and Agricultural censuses. At the same time, the GOB has typically relied on external financing and technical assistance for the realization of these undertakings, including assistance from multilateral and bilateral donors with financing from the United Nations Population Fund (UNFPA) for technical assistance. Past experiences in the collection of national censuses ­population and housing, agricultural or economic­ suggest that INE has the capacity to successfully complete them. Nevertheless, INE's resources will need to be complemented and its technical capacity will need to be strengthened for the successful implementation of the activities to be financed under this operation. C. Fiduciary Financial Management 44. As part of the preparation process of the Bolivia Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project, the FM team has performed a financial management capacity assessment to determine the adequacy of INE's financial management arrangements to support project implementation. The assessment has been performed in accordance with Operational Policy/Bank Procedure 10.02 ­ Financial Management and the Manual "Financial Management Practices in World Bank Financed Investment Operations", and as a result detailed FM arrangements have been defined as described in Annex 7. 45. Project design is straightforward and does not require complex institutional arrangements. Due to the nature of activities, a high volume of small transactions is expected, and activities under each component are clearly defined and a detailed programming and budget for the life of the project has been prepared. As implementing entity, INE has in place a sound financial and administrative structure, equipped with experienced and qualified staff and follows adequate and documented accounting and internal control procedures. Within such environment, and in order to ensure smooth project implementation, INE will establish and thereafter maintain throughout project implementation a technical unit responsible for census under the General Coordination Directorate and an administrative unit under the Administrative and Services Directorate, that would undertake overall responsibility for project financial management tasks, and to that end this unit will be strengthened with the contracting of qualified and experienced FM staff, both at central and regional level. INE's overall processes and procedures, information systems and internal control mechanisms have been adjusted and strengthened to adequately address project needs, and those arrangements have been reflected in the Operational Manual. However, a critical measure to ensure adequate operation of defined arrangements will be timely selection and contracting of key staff before project implementation begins. 46. With the information available as of the date of this document, the project's residual inherent risk is rated substantial; similarly the FM control risk is rated substantial too, mainly because the proper operation of designed FM arrangements will highly depend on the timely appointment and hiring of qualified staff to ensure project implementation. 15 47. Based on the progress reached by INE in the design, definition and implementation of required arrangements, the proposed FM arrangement as described in this Annex and as reflected in the Operational Manual, subject to the timely contracting of key staff, are considered acceptable to the Bank. Procurement 48. Taking into account the considerable and very delicate bid process in the first stage of the project, there is need to adequately strengthen INE's current capacity both in terms of its technical and fiduciary staff, as well as processes and procedures in order to make sure INE is able to fully respond to project needs, allowing timely, agile, and smooth project implementation. To this end, INE will need to maintain or hire/contract Procurement Specialists with a solid background and experience with the World Bank Procurement guidelines, according to the Terms of Reference approved by the Bank. 49. INE will be strengthened to meet the needs of the project. This will include additional personnel, specific technical trainings, and trainings on the fiduciary responsibilities under the project, among others. A Project Operational Manual has been developed to define responsibilities and operational procedures in terms of their financial management and procurement requirements. The Operational Manual has been reviewed by the Bank and the arrangements proposed have been considered acceptable to the Bank. 50. Retroactive Financing. Retroactive financing of expenditures up to US$ 5.0 million equivalent for eligible activities that have been procured following procedures acceptable to the Bank, may be considered provided that said expenditures are incurred up to one year prior to the date of the Financing Agreement but after November 30th, 2010, but in no case more than one year prior to the date of the Financing Agreement. D. Social 51. It is expected that the improved statistical capacity and informational base will lead to better planning and improved social services delivery to the population, in particular to poor and indigenous populations, in such areas as health, education, and social protection. The project will help improve the statistical capacity and informational base of INE, and of other relevant line ministries and agencies where applicable, in evidence-based decision making for the design, monitoring and evaluation of social programs, projects and policies. Furthermore, the activities to be financed by the project will address fundamental GOB information requirements and urgent social needs. The decentralization process requires the allocation of public resources and the targeting of funds on a per capita and needs basis. The information that will be obtained from the two national censuses and the improved continuous household survey will provide much needed information to update the formulas used to determine the allocation of public resources. Updating the multi-purpose cartography will also be very useful given the myriad of applications for geo-referenced data in terms of environmental and risk management, emergency and disaster preparedness and mitigation strategies, which are particularly important given Bolivia's high exposure to natural disasters. 16 E. Environment 52. The project does not have any environmental impact. It is rated as Category C. F. Safeguard policies 53. Indigenous people are disproportionately represented among the country's poor. Fifty-one percent of the Bolivian population is indigenous according to the 2007 household survey. The indirect beneficiaries of the project will be all the Bolivian population, with its majority indigenous population. There are no direct effects on the indigenous population, and thus no negative impacts anticipated. 54. The project does not require a standalone Indigenous People Plan (IPP). The Operational Policy 4.10 ­ Indigenous Peoples, paragraph 12, states that when indigenous peoples are the overwhelming majority of direct project beneficiaries, the elements of an IPP should be included in the overall project design and a separate IPP is not required. While indigenous people, along with the rest of the Bolivian population, are indirect project beneficiaries, given their majority presence in the overall population, the project has given due consideration to the conditions and circumstances of this key segment of the population in the design of the project. The GOB has undertaken a consultation process with indigenous communities, both at the national and community levels. 55. Previous National Agricultural and Population and Housing Censuses have been successfully collected in Bolivia with the assistance and participation of the public, including the indigenous population. INE has already started working on campaigns to increase public awareness of the importance of participating in both censuses. INE traditionally has relied on the local population to collect the census information. In particular, INE hires teachers and secondary school students in each community as temporary census workers, who are trained on data collection techniques. This helps increase the response rate among surveyed households as they feel more comfortable to respond to another community member who will be able to communicate in their local language. 56. INE historically has taken into account the major language barriers that members of some indigenous groups face if they do not speak Spanish, and has taken the appropriate steps to translate censuses and household questionnaires into the main indigenous languages. In order to avoid excluding or hindering the participation by members of indigenous groups who do not speak Spanish, INE has translated in the past the censuses questionnaires into Aymara, Quechua and Guaraní, which are the three most widely spoken indigenous languages, and will do so again during the two censuses that will be financed by this project. 57. INE also has learned from past mistakes, including the proper formulation of census questionnaires in order to allow for the adequate and full identification of ethnic origin. Whether through self-identification or through the ability to speak or understand an indigenous language, INE has learned from its experience in the previous census and surveys what works and what has not worked for adequate identification of ethnic origin and has adjusted the questionnaires accordingly. Thus, the census questionnaires will be culturally sensitive and will be amply tested in the field before the actual censuses are collected, in order to insure 17 participation by all indigenous groups. This will be facilitated by the fact that the persons collecting the information for the censuses and surveys are members of the local communities, who typically speak the same language. Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.01) [] [X] Natural Habitats (OP/BP 4.04) [] [X] Forests (OP/BP 4.36) [] [X] Pest Management (OP 4.09) [] [X] Physical Cultural Resources (OP/BP 4.11) [] [X] Indigenous Peoples (OP/BP 4.10) [X] [] Involuntary Resettlement (OP/BP 4.12) [] [X] Safety of Dams (OP/BP 4.37) [] [X] Projects on International Waterways (OP/BP 7.50) [] [X] Projects in Disputed Areas (OP/BP 7.60) [] [X] G. Policy Exceptions and Readiness 58. The proposed project will not require any exceptions from Bank policies and will comply with all applicable Bank policies. 59. Based on the recent financial management and procurement assessments conducted, it is clear that INE has in place, or has clearly identified and is in the process of developing, the necessary institutional arrangements in order to implement the proposed operation. Nonetheless, it requires time and assistance to support all the recommendations suggested by FM and Procurement, particularly with regards to the needed staffing within INE, specifically for the Dirección de Censos. Terms of reference have been prepared to facilitate the hiring of key personnel, and the appropriate staff is to be appointed no later than three months after the Effectiveness Date. 60. A detailed Procurement Plan has been prepared for the first 18 months of the project, and bidding documents are under preparation to advance quickly upon project effectiveness. 18 61. The MPD has agreed to commitment counterpart resources of approximately US$5 million. A substantial portion of these resources are to be made available to INE prior to the Effectiveness Date in order to advance on project activities. 19 Annex 1: Country and Sector or Program Background BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Recent economic performance 1. Between 2006 and 2008, Bolivia benefited from exceptionally positive external conditions. Average GDP growth reached around 5.2 percent, while significant current account surpluses were attained due to high commodity prices, strong growth of remittances and the beginning of operations of a major mining project, San Cristobal. Despite the fact that public capital formation increased from 6.9 percent of GDP in 2005 to around 9.3 percent in 2008, high oil and gas prices and changes in the hydrocarbon tax regime applied since 2005 turned fiscal deficits into significant surpluses. The external public debt was reduced from 52 percent of GDP at the end of 2005 to only 14 percent at the end of 2008, largely due to the Multilateral Debt Relief Initiative (MDRI). However, private investment remained modest because of the uncertainty created by ongoing reforms, including the nationalization of strategic enterprises, which have damaged the already fragile investment climate in Bolivia. Table 1: Key macroeconomic indicators 2005 2006 2007 2008 2009 Economic growth rate (%) 4.4 4.8 4.6 6.1 3.4 Inflation rate (%) 4.9 4.9 11.7 11.8 0.3 Devaluation rate (%) 0.2 -0.6 -4.5 -8.7 0.0 Current account balance (% of GDP) 6.5 11.6 12.2 11.7 4.7 Hydrocarbon exports ($ billion) 1.4 2.0 2.3 3.5 2.0 Mining exports ($ billion) 0.5 1.1 1.4 1.9 1.8 Net international reserves ($ billion) 1.7 3.2 5.3 7.7 8.6 Overall fiscal balance (% of GDP) -2.3 4.5 1.8 3.2 0.1 2. The global downturn had modest effects on the Bolivian economy. Economic growth fell from 6.1 percent in 2008 to 3.4 percent in 2009, but it was the highest growth rate in the LCR region in 2009. During this period, Bolivia was affected by lower commodity prices, and the fall in the demand for natural gas from Brazil, due to the global economic crisis and the increase of its own hydroelectric potential. The impact of these events was mitigated by the gradual recovery of commodity prices, growth in mining export volumes, as the San Cristobal mining project reached its maximum capacity, and the moderate impact of the crisis on remittances. The current account surpluses decreased from 11.7 percent of GDP in 2008 to 4.7 percent in 2009, while international reserves continued growing, although more slowly, from $7.7 billion to $8.5 billion (20 months worth of goods imports). The fiscal surplus of 3.2 percent of GDP attained in 2008 fell to near balance in 2009 due to the reduction in oil revenues and the incomplete 20 implementation of the ambitious investment program proposed by the Government when the crisis began. Recent political developments 3. In 2005, Evo Morales, the first indigenous President of Bolivia, was elected with the support of the majority of the population after a decade of political instability. He ran on a platform proposing increasing participation of the poor and the redistribution the country's natural wealth. In the past four years a profound constitutional reform has been approved aiming at empowering the excluded groups, and to promote greater decentralization as well as wider social participation. The Government has introduced and scaled up widespread cash transfer programs. The hydrocarbon and other sectors were nationalized; state enterprises have been created to promote the development of various productive sectors, to improve the delivery of some public services and to ensure food security. 4. The measures taken have been well received by most people, especially those living in the western region of the country, with a larger share of indigenous populations. They also prompted greater support from traditionally opposition-held regions of the lowlands, making it easier for the incumbent president to be re-elected in the December 2009 elections. The ruling party also secured an absolute majority in the Plurinational Assembly. The Assembly has started adjusting the existing legal framework to the new Constitution of the Plurinational State, with a particular emphasis on the autonomy law that defines competencies of each level of government. The ample support for the ruling party was reflected in the April 2010 departmental and municipal elections, where the ruling party won six of the nine departments and most municipalities. However, some local independent leaders won important municipalities, particularly in larger cities, including some traditional strongholds of the ruling party in the highlands, while three lowland departments were won by opposition figures. Poverty and inequality 5. Bolivia is one of the poorest countries in Latin America and the Caribbean (LCR). With a per capita Gross National Income (GNI) of US$1,460 in 2008, it is classified as a lower-middle income country, only surpassing the per capita GNI levels of Guyana, Nicaragua, and Haiti in LCR. The United Nations Development Program (UNDP) ranked Bolivia 113th out of 182 countries on its 2009 Human Development Index. 6. Not only are poverty and inequality levels in Bolivia are among the highest in the region, but they are especially high among its indigenous population. The most recent official estimates show that 59.3 percent of the population was poor, and 32.7 percent was extremely poor (2008). Inequality, as measured by the Gini coefficient, was 0.56 (2007), one of the highest in LCR, which is one of the most unequal regions in the world. Poverty rates and inequality are higher in rural areas, where moderate poverty reached 74.3 percent of the population, extreme poverty 53.3 percent (2008), and the Gini coefficient was 0.64 (2007). Similarly, indigenous populations registered above average poverty rates, with 66.5 percent and 47.4 percent in moderate and extreme poverty, respectively (2007). 21 7. Despite the high levels of poverty prevailing in Bolivia, poverty rates have decreased in the last few years as a result of sustained moderate growth. Poverty declined from 66.4 percent in 2000 to 59.3 percent in 2008. Extreme poverty also declined from 45.2 percent in 2000 to 32.7 percent in 2008. Similar reductions have also been observed in rural areas and among the indigenous population. Background on the National Statistics Institute 8. The creation of the current National Statistics Institute (Instituto Nacional de Estadísticas or INE) dates back to 1863, when a section denominated the Statistical Bureau (Mesa Estadística) was created within the Ministry of Finance (Ministerio de Hacienda), a body which in 1896 became the National Office for Immigration, Statistics and Geographic Propaganda (Oficina Nacional de Inmigración, Estadística y Propaganda Geográfica). Afterwards, this office was designated as the Office of Statistics and Budgets (Oficina de Estadística y Presupuestos), also dependent on the same Ministry. 9. After the Chaco War concluded, statistics became more important for the country; as a result, on January 14, 1936, during the presidency of José Luis Tejada Sorzano, the General Directorate of Statistics and Census was founded, a state entity that was dependent on the Ministry of Finance and Statistics (Ministerio de Hacienda y Estadística). 10. On April 30, 1970, this office became the National Statistics Institute (Instituto Nacional de Estadística), dependent on the National Economics and Planning Council (Consejo Nacional de Economía y Planificación or CONEPLAN), and became a decentralized public institution through the General Law for the Bases of the Executive Power (Ley General de Bases del Poder Ejecutivo N° 09195). 11. Until 1976, INE offices only functioned in the city of La Paz. In the same year, a decree was enacted (Decreto Ley Nº 14100) termed the Law of the National System for Statistical Information. In 1977, the departmental directorates for statistics were created, which were the offices in charge of collecting the statistical information generated by the nine departments in Bolivia. 12. Since its creation, INE has provided the country with statistical information through the national population and housing, agricultural, and economic establishment censuses, as well as though multiple statistical operations that have allowed the Bolivian population to understand their socioeconomic, gender, environmental, and indigenous realities, among others. Background on the National System for Statistical Information 13. Since October 1976 the National System for Statistical Information (Sistema Nacional de Información Estadística or SNIE) was established in Bolivia with the objective to provide statistical information in a more efficient way in order to orient the country's development. The directive body is the INE, a public entity with its own legal personality and technical, normative, and administrative independence that coordinates and supervises the official statistical activity of the SNIE. The institutions that are part of the SNIE are all those entities that carry out statistical activities according to the Law. They have the obligation to cooperate with INE in the 22 development of National Statistical Plans (Planes de Estadística Nacional) and may not produce statistical information without the prior approval of their work plans by the National Statistical Council (Consejo Nacional de Estadística). 14. The SNIE also defines official statistical activity as the set of procedures, methods, and techniques for the collection, elaboration, analysis, processing and dissemination of statistical data aimed at the production of economic, social or other kinds of indicators. The official statistics activities of SNIE are guided by the following principles: (i) service to society in its information needs; (ii) professional integrity by applying technical principles and professional ethic standards; (iii) selection of quality information; (iv) organization of statistical activities through norms and procedures; (v) activities through the efficient use of resources; and (vi) information availability based on needs. 15. The National Statistics Council is the highest organizing body of the SNIE, and is responsible for defining and establishing the policies for official statistical information. It is composed of the Minister of Development Planning (Ministro de Planificación del Desarrollo, formerly Ministro de Planeamiento y Coordinación), the Minister of Finance (Ministro de Finanzas), a representative from the Ministry of National Defense (Ministerio de Defensa Nacional), a representative from the Central Bank of Bolivia (Banco Central de Bolivia), a representative from the Association of Private Entrepreneurs (Asociación de Empresarios Privados), and the Executive Director of INE, who acts as the Executive Secretary of the Council. 16. In a similar way, the law also defines the technical committees for Statistical Coordination, which can be sectoral, regional or special, permanent or temporary, whose number will be established according to the requirements of the System. They are integrated by representatives from institutions akin to the System and are constituted by INE. 17. The system defines that every person in the country, its residents and passer-bys are obliged to supply data and information in the terms required of them which, by nature and objective, have a relation with the activities of the SNIE and are required by INE. There is currently a proposal to modify the statistics law in order to reconstruct the system in such a way that it complies with the nature of the new CPE. 23 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project 1. The GOB has expressed interested in receiving World Bank assistance for developing a multidimensional measure of welfare to monitor the "Living Well" (Vivir Bien) strategic objective of the PND. The goal is to promote a comprehensive concept of welfare development that includes not only reducing monetary poverty, but also poverty in terms of access to health, education and other goods and services that are considered fundamental for the pursuit of happiness. The World Bank is providing non-lending analytical assistance to the GOB in order to develop such measures as equality of opportunities, through the Human Opportunity Index (HOI), and multidimensional poverty, to help both the diagnosis and targeting of the population that fails to reach minimum standards of multidimensional welfare. The proposed project will provide valuable statistical inputs in order to construct the multidimensional measure of poverty. As such, the two projects are complementary. The team of this project will work in close coordination with the team that is assisting the GOB in this effort. 2. There are several other active projects in the World Bank's portfolio in Bolivia that may benefit from the strengthening of the statistical capacity and informational base in the country, including: (a) the Rural Alliances Project, which finances investment projects in agriculture production destined for domestic market consumption; (b) the Participatory Rural Investment Project II, which targets poor regions with great productive potential by supporting productive infrastructure and management capacity; (c) the Decentralized Infrastructure for Rural Transformation Project, which provides alternative energy mechanisms (solar panels) to remote areas; (d) the Lake Titicaca Local Sustainable Development Project, which combines the provision of water and sanitation and activities aimed at increasing income levels of the beneficiary population through tourist development of the communities around Lake Titicaca; (e) the Disaster Recovery and Vulnerability Reduction Project, which addresses the impacts of flooding caused by the natural disasters of El Niño and La Niña events; (f) the Urban Infrastructure for the Poor, which improves the basic infrastructure of the poorest neighborhoods in the Municipality of La Paz, improves the urban transportation network in the Municipality of El Alto and extends the basic sanitation coverage in the Municipality of Santa Cruz; (g) the Road Rehabilitation and Maintenance, which improves road accessibility through the rehabilitation of key segments of the national and secondary road networks and the strengthening of the country's capacity to manage road assets; (h) the Investing in Children and Youth Project, which contributes to the GOB's conditional cash transfer (CCT) program to tackle chronic malnutrition in the most vulnerable rural municipalities; (ix) the Expanding Access to Reduce Inequalities Adaptable Program Loan (APL), or Health APL III Project, which complements the CCT through supply side interventions in health; (i) the Secondary Education Transformation Project, which extends the coverage and improves the quality of secondary education in the Municipality of La Paz. 3. The INE had worked in the past with: (a) the Regional Program for Improving Household Surveys and Measurement of Living Conditions in Latin America and the Caribbean (ISLC/MECOVI) to generate adequate and high quality information about the living conditions 24 of people in the region, in terms of scope, coverage, reliability, timeliness and policy relevance. This kind of information is needed for the design, monitoring and evaluation of policies, programs and projects, aimed at reducing poverty and the promotion of greater social equity. Bolivia started working with MECOVI in 1999 for an initial period of five years; (b) The Accelerated Data Program (ADP) was launched in 2006 as a recommendation of the Marrakech Action Plan for Statistics (MAPS), to undertake urgent improvements needed for monitoring the Millennium Development Goals (MDG), by improving survey programs in participating countries. Measuring and monitoring development outcomes require timely, reliable, comparable, relevant, and accessible, survey data. But in many developing countries, survey programs rarely provide the necessary flow of reliable, timely, comparable and accessible data. The timing of national surveys is rarely optimal, data collection programs lack methodological consistency, and existing data often remain largely unexploited. Since 2008, INE started, with the support of ADP, to work with the documentation of their statistical operations and publish their own survey catalog, which can be found online (www.ine.gob.bo/anda). 4. In fact, the rate of return for some of these projects may increase and the targeting may become more accurate as a result of higher quality data from INE. Finally, it is important to recall that this project will be implemented by INE, and that the latter is also implementing the World Bank Project's Investing in Children and Youth and Disaster Recovery and Vulnerability Reduction. 25 Annex 3: Results Framework and Monitoring BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Project Development Objective (PDO) Project Outcome Indicators Use of Project Outcome Information The project development objective is to strengthen the The successful completion of the four statistical capacity of the GOB and improve the statistical operations will strengthen GOB has updated quality statistical informational base of the country, in order to provide Bolivia's statistical capacity and improve the information that has been quality information, as defined by its reliability, informational base of the country. disseminated widely within the timeliness, accuracy and representativeness with the Government and among the public. The four statistical operations will provide level of disaggregation necessary to support systems for essential inputs for planning, designing, planning, designing, monitoring and evaluating public monitoring and evaluation of public programs and policies. programs and policies The availability of quality statistics will result in greater transparency and accountability and a more effective strategy for the reduction of poverty, inequality and social exclusion Intermediate Outcomes Project Outcome Indicators Use of Project Outcome Information Outcome 1: The updated multi-purpose cartography will serve for multiple applications, including the Updated Multi-Purpose Cartography used for the 100% of physically demarcated as list of all Agricultural Production Units preparation/application to relevant statistical operations well as non-demarcated areas have (UAP) needed to collect the National updated cartographic information Agricultural Census, the list of all dwellings used in the preparation of the needed to collect the Population and National Agricultural Census and Housing Censuses, and the master frame National Population and Housing needed to collect the new EHC Census Outcome 2: List of Agricultural Production Units The National Agricultural Census will (UPAs) at the municipal level provide the informational base needed to Updated information available on agricultural and assess the productive potential of the livestock production in the country agricultural sector, and the statistical information needed for the improved design, monitoring and evaluation of agricultural policies and programs, as well as the inputs for the design of an agricultural insurance 26 program. Outcome 3: 90% of dwellings accounted for in The National Population and Housing Census the National Population and Housing will provide the information needed to Updated demographic information available for the Census update the formulas used to determine country transfers from the national government to states and municipalities, as well as the statistical information needed for the improved design, monitoring and evaluation of PND priority policies and programs. 90% of departments have The redesigned ECH, including its new representative data on living instrument, sampling frame and expanded Outcome 4: standards sample size, will allow for the production of Updated information on living standards available for high quality statistics which are the country representative at the departmental level The new ECH will also allow the estimation of poverty levels and living standards over time using a sound and consistent methodology 27 Arrangements for results monitoring Target Values (Percentage Data Collection and Reporting Advance in Target over Baseline) Project Outcome Indicators Baseline YR1 YR2 YR3 YR4 Frequency Data Responsibili and reports Collection ty for Data Instruments Collection Component 1: Updating of the Multi-purpose Cartography Updated Multi-Purpose Cartography used for the 0% 40% 100% Twice per Independent INE preparation/application to relevant statistical operations year external verification commissioned by INE in agreement with Bank Component 2: National Agricultural Census (i) Pre-census: develop a list of UPAs at the municipal level 0% 50% 100% Twice per Independent INE and conduct a pilot census to test and adjust the instrument(s) year external to be used; verification commissioned by INE in agreement with Bank (ii) Census: collect information on UPAs through the use of 0% 0% 100% Twice per Report by INE INE internationally recognized instruments, techniques, methods year and standards adapted to the Recipient's own context; and thereafter (iii) Post-census: disseminate the processed information of the 0% 0% 0% 100% Twice per Report by INE INE data collected year 28 Component 3: Population and Housing Census (i) Pre-census: (a) develop the census instrument for the 0% 0% 50% 100% Twice per Independent INE collection of demographic information; (b) prepare training year external materials and carry out training activities for operational staff verification in charge of census activities; (c) elaborate dissemination commissioned materials that will be used to promote the participation of the by INE in population in this data collection exercise; (d) develop a pilot agreement census and experimental censuses to test and adjust with Bank accordingly the material that will be used in the main census (ii) Census: process and collect the census data; 0% 0% 0% 100% Twice per Report by INE INE year (iii) Post-census: disseminate the processed information of the 0% 0% 100% Twice per Independent INE data collected by the census. year external verification commissioned by INE in agreement with Bank Component 4: Continuous Household Survey Expanded sample size for the collection of the ECH, based on 0% 0% 100% Annual Independent INE the updated cartography external verification commissioned by INE in agreement with Bank Completion of the redesigned ECH questionnaire 0% 100% Annual Report by INE INE 29 Completion of the pilot test using the redesigned sampling 0% 50% 100% Annual Independent INE frame, the expanded sample size and the redesigned external questionnaire verification commissioned by INE in agreement with Bank Completion of data collection in the field 0% 0% 50% 50% Twice per Report by INE INE year Completion of the processing of the data 0% 0% 0% 50% 100% Twice per Report by INE INE year Completion of the dissemination of the results of the new 0% 0% 25% 50% 100% Twice per Report by INE INE ECH year Perception survey conducted among expert users of statistical 50% 100% Annual Survey Independent information on the quality of the ECH report higher conducted by agency or satisfaction levels in terms of access and quality of independent consultant information (surveys in baseline and year 4 expected to show agency or a statistically significant increase with respect to baseline) consultant 30 Annex 4: Detailed Project Description BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project 1. This project has four components: (a) the updating of the multi-purpose cartography; (b) the design and implementation of the activities of the pre-census and census stages of the III National Agricultural Census; (c) the design and implementation of the activities of the pre- census stage of the Population and Housing Census; and, (d) the redesign of the sampling frame and expansion of the sample size of the Continuous Household Survey in order to extend its representativeness to the departmental level as well as for the four largest cities. These components were selected jointly by the Ministry of Development Planning, the National Statistical Institute and by the World Bank, as these operations are considered to be cornerstones of the National System for Statistical Information, as well as fundamental inputs for the planning and monitoring and evaluation systems of priority public programs and policies as defined by the PND. Component 1: Updating of the Multi-Purpose Cartography (US$14.8 million) 2. This component will finance the updating of the multi-purpose cartography of the territory of the Plurinational State of Bolivia. The cartography in a census is essential because it determines the geographic operational universe and provides: (i) the geographic coverage of the Census; (ii) information on the amount and location of dwellings and primary agricultural units or UPA; (iii) the definition of the operating units to organize the staff; and, (iv) the information needed for an efficient allocation of statistical resources for the collection of information. Technological advances enabled INE to develop a digitized cartography for the 2001 Census. Nevertheless, because of the demographic dynamics of the country, this information is obsolete and requires updating. The multi-purpose aspect of the cartography allows for the concurrent collection of information from research units related to population and housing, agricultural activity, and economic establishments. 3. The foundation for conducting the multi-purpose cartographic updating will stem from the digitized cartography that INE has adjusted with information from satellite images and cadastral mapping from those municipalities in which it has developed this information in digital format and agreed to provide through agreements. 4. The field activities will be outlined and organized in great detail in order to maximize the efficient use of time and ensure full coverage of the territory. Among the first activities to be undertaken will be to contact all the local authorities and indigenous leaders in order to obtain their collaboration and support for the implementation of the work. The objectives and the importance of the multi-purpose cartographic updating to its region must be clearly explained. 5. The multi-purpose cartographic updating includes conducting the following series of activities: 31 (a) Verification: Confirm the correct name and location of the natural (rivers, lakes, hills, etc.) and cultural (bridges, localities, etc.) elements in the field based on maps and blueprints. To begin this task, the limits on the municipalities and districts, as well as the areas of statistical research, will be verified exclusively for statistical purposes. In parallel, the respective data collection forms will be completed. (b) Correction: Correct identified errors either in the name or in the writing of a natural or cultural element. (c) Addition: Incorporate the graphic details that are observed in the field that are not in the map or blueprint provided. (d) Georeferencing of localities: Through GPS-enabled hardware and GPS software, record the geographical coordinates of each locality in the country's territory. (e) Filling respective forms: Register the characteristics of the information solicited in the respective forms, while graphical representation of dwellings and economic establishments will be produced in the cartographic division. There will be also a list of the UPA. (f) Shaping sectors and segments: Once the fieldwork of a municipality or district is completed, sectors and segments for analysis will be established. (g) Codification of segments and census sectors: Once the sectors and segments are defined, they will be codified within the framework of the administrative political division. 6. The success of the activities at national level depends largely on the level of recognition by the general population of the usefulness of the project and their cooperation through their participation. In that regard, activities will be designed related to building public awareness of the purpose and scope of the project among the population. 7. A pilot test was conducted of the cartographic updating in the municipality of Tiquipaya, in the department of Cochabamba, between August 17 and September 11, 2009. In parallel, the updated cartography of the municipality was also developed. This system allows for the consultation of spatial information of the data obtained through the cartography update. This system also has the option to link information from administrative records through geographic coding. 8. The area selected to carry out the pilot test of the multi-purpose cartographic updating was the whole territory of the Municipality of Tiquipaya. The reasons why this municipality was chosen were: (a) Easy access to a high percentage of the municipality. (b) Economic dynamism. (c) Size and distribution of the urban and rural populations. 32 (d) Economic activity of the population. (e) Difficulties that may be common in other municipalities of the country. 9. The success achieved in this pilot test provides the basis needed to conduct the multi- purpose cartographic updating throughout the country, and develop a similar publication of results for each municipality once the multi-purpose cartographic updating has been completed. 10. In particular, this component seeks to: (a) Ensure the geographic coverage for the National Censuses: Population and Housing, Agricultural and Economic Establishments, through a single geographical base. (b) Determine the number of buildings depending on their use - housing (individuals, collective) or economic establishments, as well as the amount of agricultural producers or UPA. (c) Update the natural and cultural elements, and toponymy through georeferencing using a GPS of the existing localities. (d) Shape operational census units to organize staff and distribute materials in an efficient manner, as well as ensure the necessary logistics. (e) Update information on infrastructure and health and education equipment, as well as basic services, the media, and accessibility, among others. (f) Obtain information about the daily movements of the population for access to services such as health, education, registration or administrative processes and records. Component 2: National Agricultural Census (US$13.2 million) 11. Accounting for 13.5 percent of Gross Domestic Product (GDP), the agricultural sector plays an important role in the national economy of Bolivia, as one of the main economic activities of the country. This component will finance the activities of the pre-census and census stages of the III National Agricultural Census (NAC), including the collection of information on the agriculture, forestry and aquaculture establishments from all the municipalities in the country. More specifically, this component seeks to: (i) develop a directory of the Agricultural Production Units (UPA) at the municipal level; and (ii) collect information on nearly 750,000 UPA through a basic questionnaire, based on international standards set by the United Nations Food and Agriculture Organization (FAO) that have been adjusted to the national reality of Bolivia. 12. Between the 1992 and 2001 Population and Housing Censuses, the percentage of the population in rural areas was reduced by 4.87 percentage points (from 42.45% to 37.58%). The population employed in agricultural activity represented approximately 47 percent of the rural 33 population and 87 percent of the rural economically active population, becoming the activity with the largest amount of the economically active population, which reveals the importance of agriculture to the national economy. However, because of the risks involved in the agricultural production process, producers tend to increasingly diversify their sources of income as a survival strategy, especially in the west. 13. The low levels of investment in the length and transfer of technology, as well as in irrigation infrastructure and other factors of production, accompanied by aspects of a structural nature such as the excessive smallholdings, strong dependence on climatological factors, soil deterioration, overgrazing and low access to productive credit, have led to yields of the most important crops lower than those in others countries of the region. 14. The Agricultural Statistical Information System, in existence for more than ten years, suffered from a series of limitations, and is now totally deteriorated. The quantity, quality and frequency of the data produced were inadequate and not adapted to the growing demand from users in the public and private sectors. 15. The 2001 Census results showed that indeed there were several types of production relations. Among them, the most dominant productive method, based on the area under cultivation, was through big ranches, or haciendas, (operated with settlers), where 12,701,077 hectares (38.78%) of the total surface belonged to 8,137 landowners (9.42%). Another dominant relationship was the self-production of indigenous communities or "Ayllus", where 3,779 communities possessed the 21.92 percent of the total surface area of the country and were owners of 7,178,449 hectares. The other relationships such as small production, lease and tenancy and others represented 39.30 percent of the total surface area. The aggregate results show us 86,377 productive units with an area of approximately 32,749,850 hectares. 16. The II National Agricultural Census, which was conducted in 1984, was held under very difficult circumstances in the country. From 1980 to 1985, Bolivia experienced a period of deep political and economic crises, during which time the census was not conducted in the Department of La Paz. However, notwithstanding the above-mentioned problems, the census was processed within the technological framework available, and to complete the missing information, some estimates were made and data provided by other agencies was used, especially by the Department of Statistics of the Ministry of Rural and Agricultural Affairs. The final results were published in 1989 by INE. 17. The results of the II National Agricultural Census showed changes in the production structure of the sector, considering this activity as one of the most important of the national economy. Information about the sectoral structure was made available in the areas of land use and tenure and livestock populations by species, variables needed to understand the agricultural structure and which obey international recommendations. This Census obtained data from 314,600 units of production; however, with estimates made by the former Ministry of Agriculture, the final results were obtained from 519,399 units of production with an area of approximately 23,263,429 hectares. It is necessary to clarify that for the Department of La Paz, information was available only in the Provinces of Franz Tamayo and Iturralde, so the results were only published at the level of the two above-mentioned provinces of the Department. 34 18. The II National Agricultural Census served as the baseline for defining the sample frame from which the National Agricultural Survey (ENA) was conducted annually, with the latest carried out in 2008. The sample had national and departmental representativeness for approximately 1,062 segments. 19. Several proposals have been made to conduct the National Agricultural Census, one of which was presented in 1996, with the objective to understand the productive, social and technological structure of agricultural and livestock activity of the State. The information would serve for the formulation of policies, plans and projects that benefit producers, and at the same time, complement the Statistical Agricultural Information System. 20. In 2008, the Government announced its intention to conduct the National Agricultural Census, at which time the GOB requested assistance from the Bank for this purpose. Various changes in government and competing issues shifted priorities away from the census, which have resulted in delays in its implementation. The importance of the census has resurfaced with the intention of the GOB to establish an agricultural insurance program, which will require the inputs from the census to determine the demand and supply for such a program. 21. The limited information about the sector demonstrates that agricultural activity is unfolding in a framework of declining productivity, and consequently a declining level and quality of life of the farming sector. The lack of dynamism, aggravated by structural problems, has led to the irrational use of natural resources, translated in the irrational use of water, the high degree of salinization, erosion, deforestation, low fertility, etc. In that context, since the last National Agricultural Census, dating back 26 years, and the lack of continuous agricultural surveys, the agricultural productive and rural sector of Bolivia relies heavily on poor and outdated information. This situation demonstrates the vulnerability and the dismantling of the Agricultural Statistical System, as the 1984 census and the last National Agricultural Survey carried out in 2008, represent the latest data based on statistical methods, and constitute the principal source of official figures used for the whole country. 22. These considerations highlight the vital importance of the National Agricultural Census, which has become an urgent need for the State. The III NAC will allow for the collection of updated and representative data of the productive characteristics and conditions of all units of agricultural and livestock production, from which the definition, formulation, monitoring, and evaluation of policies, strategies, plans, programs and projects are a fundamental part of the sectoral strategic planning. It also considers that the results will be useful for the producers and rural organizations themselves for the determination of strategies to guide research and agricultural extension. 23. The statistical unit, or unit of analysis, is the Agricultural Production Unit (UPA), defined as "all the land or plots of land devoted wholly or partly to the agricultural and/or livestock production, under the direction of a producer, regardless of size, status or land tenure". For the purposes of the census, both crops and animal species will be included in agricultural production. 24. The methodology of enumeration to be used in the National Agricultural Census is based on direct interviews with all agricultural producers. These interviews will be implemented with the production units and producers themselves, which implies that the census will cover all the 35 dispersed rural areas of the national territory engaged in some kind of agricultural activity. The interviews should give preference to producers or qualified informants (wife, older son or daughter) who can provide accurate information on the variables that the census will investigate in each of the UPA. 25. More specifically, this component will: (a) Develop a list of Agricultural Production Units (UPA) at the level of each municipality. (b) Collect data of all the UPAs in the country (750,000 approximately) through a core questionnaire that collects the main variables. (c) Generate the sampling frame for the agricultural sector of the country. (d) Disseminate the census results. (e) Lay the groundwork for the implementation of the National Agricultural Information System. Component 3: National Population and Housing Census (US$20.6 million) 26. A Population and Housing Census (CNPV) seeks to provide updated statistics on the demographic, social, economic and housing conditions existing in the country in order to adjust and define plans, programs and policies and strategies for the implementation and evaluation of sustainable human, economic and social development at the national, sectoral, departmental and municipal level. In Bolivia, over a period of 161 years, from the first census of 1831 to the last carried out the year 2001, ten population and four housing censuses have been conducted. A National Population and Housing Census is the only source of complete data necessary to produce basic information on demographic, social, economic and housing characteristics of the population for various purposes, by major and mainly minor geographical units. 27. The last National Population and Housing Census, conducted in 2001, provided an important contribution to the development of the country. The results obtained constitute the most complete source of demographic, economic, social, and housing information, and have been useful for planning the processes of change required through the reforms carried out in the country in recent years. 28. For the Population Census, the main unit of investigation will be the household. A household is defined as one or more people who live together, whether or not united by family ties, in order to provide and meet their food and other essential needs. For the Housing Census, the research unit will be the dwelling, whether particular or collective. A dwelling is defined as the entire housing enclosure, structurally separated and independent that has been built, transformed or ready to be inhabited by people, provided that as of the date of the census it is not used fully for another purpose. 36 29. The next census will take into account the basic features of any census operating such as: (i) Universality - registration of the entire population of a defined geographic area with reference to the determined time of the census; (ii) Simultaneity - operating concurrently throughout the country to avoid duplication and omissions; and, (iii) Individual enumeration - guarantees the separate counting of each person, dwelling and UPA. 30. Taking into account the changes in the country over the past ten years, both at the social, territorial, and political level, updated information in structural terms is required through a new Population and Housing Census to meet the absence of this type of data. 31. The pre-census stage will take into account the following processes: (i) establish goals, budget, schedule of activities, and organizational structure; (ii) update the multi-purpose cartography; (iii) define census instruments (questionnaire, manuals, forms, etc.); (iv) conduct pilot censuses; and, (v) define the dissemination campaign, logistics, recruitment, training, and personnel selection. 32. This census has a new and broad mandate for information, given the need for more disaggregated geographical information, mainly due to the creation of a new level of autonomous government, the native indigenous peasant communities. This new level of government is meant to represent the geopolitical organization of the country based on customs and habits. The 2001 Census for the first time helped the indigenous population to organize in political parties and to make themselves visible. 33. In particular, this component seeks to: (a) Develop the census questionnaire, incorporating themes that will comply with the new national information needs, the international commitments made in terms of population and development, as well as respecting international recommendations to which the country has committed, in order to ensure comparability over time. (b) Develop the questionnaires, manuals and instructional guides for the enumeration and supervision of the census operation. (c) Conduct and obtain the results of a pilot census, as well as evidence of a thematic nature, censuses pilots and departmental pilots. (d) Collect and process the census data (e) Disseminate the census results in the forms of indicators and tables that census users can easily and quickly access. Component 4: Continuous Household Survey (US$1.4 million) 34. Household surveys began in the decade of the 1980s with the permanent household surveys, which were replaced at the beginning of the 1990s with the integrated household surveys (IHS). With the support of the World Bank, the IHS was conducted over five years, in 37 order to include a component related to expenditures. Similarly during this period, the Second Income and Expenditure survey was conducted in the country after 26 years. 35. 1996 was the beginning of the National Employment Surveys, which included a component related to the income of agricultural producers. Two surveys were conducted, one in 1996 and the other in 1997. From 1999 to 2002, the surveys of the Improvement of Surveys and the Measurement of Living Conditions in Latin America and the Caribbean (MECOVI) program were included in order to improve the surveys and the measurements of living conditions, and to support the institutionalization of this type of survey in the country. The program included resources from the World Bank, the Inter-American Development Bank and the United Nations Economic Commission for Latin America and the Caribbean. 36. Bolivia entered as a member country of the MECOVI program in May 1999, with the contribution of the cooperation agencies interested in forming part of this initiative and the Government's commitment to increase the local budget during the course of the five years of the program. INE, as the executive agency and leader of the National Statistical Information System, was therefore the only institution legally authorized to carry out official censuses and economic and social surveys. With the end of the MECOVI program in the country, the Continuous Households Survey was developed during 2003 and 2004, which included the general themes of the MECOVI program, adding as well family budgets and a module on governance and democracy proposed during working meetings of the Comunidad Andina de Naciones (CAN). 37. From 2005 until today, the household survey has been developed with the funding from a multi-donor fund, mainly supported by the development agencies of Sweden and Canada. 38. The representativeness of the household surveys have been limited to research in the four principal cities, and in some periods extending to the eight principal cities, depending on financing. Due to the importance of the information gathered from the household surveys, the INE initiated studies to broaden its coverage since 1996. Currently, the survey is representative at the national level, and is stratified by population size, urban-rural, and poverty. However, it is not sufficient to respond to the new realities of the country with its new constitution and the new territorial dimension of the country. One of the important inputs of the household surveys is to provide inputs for the calculation of indicators to strengthen the mechanisms for the formulation, monitoring and evaluation of public policies through which the population in the current context achieves conditions necessary to Vivir Bien. By doing so, the surveys will respond to the demand for information of the PND for two of its five pillars: "Bolivia Digna", which contains proposals for social development with prospects for unrestricted access to social services (health, education, sanitation sectors); and "Bolivia Productiva" (employment sector), in addition to monitoring the benchmarks of the Millennium Development Goals. The subjects of study to be addressed in the survey, apart from the general characteristics of the household and its members are: health, education, housing, basic public works and services, migration, employment, incomes and expenditures, which makes it possible to know the evolution of poverty, welfare and living conditions. 39. Statistical information in any area represents an essential tool for decision-making. Both the public and private sectors have demonstrated a growing demand for information, particularly 38 for disaggregated information at the local level (municipalities). However, for the purposes of the information produced through the household surveys, this demand is visible mainly at the departmental level, where each autonomous departmental government needs to know not only the characteristics in which each of its inhabitants lives, but also in the conditions under which they develop. 40. The structure of the size of the samples for the household surveys in recent years was as follows: NUMBER OF SELECTED YEAR TYPE OF SURVEY HOUSEHOLDS 1999 3,064 Continuous 2000 5,744 Continuous 2001 5,744 Continuous 2002 5,952 Continuous (master sample) 2003-2004 9,770 Continuous (master sample) 2005 4,260 Cross section 2006 4,260 Cross section 2007-2008-2009 4,260 Cross section 41. As noted, in recent years the sample size has remained the same from survey to survey, even having a smaller sample than the surveys conducted since 2000. The criteria for choosing the sample size centered on the variable that measured poverty, such as in the Index of Unsatisfied Basic Needs (NBI) that supported a disaggregation according Urban-Rural areas and was obtained from the 2001 sampling frame. 42. Due to the requirements and the need to disaggregated information representative at the departmental level, as well as for the most important cities, the sample size must be increased in order to respond to these requirements. Therefore, it is necessary to establish a sample size that will allow a permissible sampling error at the level of departments and principal cities in the country. At the same time, the sole use of the NBI as an indicator is inadequate for its obsolescence, which is why it is important to take into account other conditions such as employment, welfare and poverty. 43. Therefore, an increase in the sample is justifiable if the aim is to have information representative at the departmental level. In this way, the sample size will be equal to 7,500 housing units at the national level concentrated in 625 Primary Sampling Units or UPMs. 44. Specifically, this component seeks to: (a) Develop a new sampling scheme and expand the sample size of the Continuous Household Survey to be representative at the departmental, urban-rural levels and disaggregated for the four main capital cities of Bolivia (La Paz, Cochabamba, Santa Cruz and El Alto). 39 (b) Develop an adjusted questionnaire for the Continuous Households Survey and their respective manuals for its implementation. (c) Collect the new survey in the field, applying the new conditions and conducting parallels with the measurements in the past in order to estimate the impact of the changes and ensure comparability with previous measurements. 40 Annex 5: Project Costs BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Project costs by Type of expenses* Cost per Travel/ component and/or Outputs Quantity Sub total Total unit Assets activity S G T Preparatory x 403,813 1 403,813 Logistics x x x 683,747 1 37,385 721,132 Updating of the Collection x x x 8,717,284 1 323,610 9,040,894 Multi-Purpose Training x 0 1 82,906 82,906 14,817,543 Cartography Cartography x x x 1,211,094 1 853,646 2,064,740 Processing x x 436,524 1 426,623 863,147 Managment x x 723,576 1 917,334 1,640,910 Preparation x x x 419,998 1 822,975 1,242,973 National Agricultural Census Collection x x x 9,422,936 1 1,610,076 11,033,012 13,232,193 Dissemination x x 859,320 1 96,888 956,208 Preparation x x x 691,435 1 972,064 1,663,499 Population and Housing Census Collection x x x 9,214,310 1 8,236,381 17,450,691 20,519,321 Dissemination x x 1,308,242 1 96,888 1,405,130 Design x x x 148,865 1 452,956 601,821 Continuous Household Survey Collection x x x 735,020 1 0 735,020 1,430,944 Dissemination x x 94,104 1 0 94,104 TOTAL 50,000,000 *Notes: S=Services, G=Goods, T=Training 41 Annex 6: Implementation Arrangements BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project 1. The National Statistics Institute (INE) will be the executing agency of this STATCAP loan. As the rector agency of the National Statistical System, INE will be responsible for managing these statistical operations. INE is a well-established entity with the competence and experience necessary to carry out the activities under the proposed project. Accordingly, INE has put in place additional internal processes and procedures, including internal controls, which so far have allowed them to prepare and provide timely and reliable information for monitoring purposes. 2. Taking into account the considerable increase in INE's activities resulting from project implementation, there is the need to adequately strengthen INE's current capacity both in terms of the technical and fiduciary staff, as well as processes and procedures in order to make sure they fully respond to project needs allowing timely, agile, and smooth project implementation. To this end, INE has informed the Bank of its decision to establish a Technical Coordination Unit under the General Coordination Directorate and a Administrative Coordination Unit under the Administration and Services Directorate, for which detailed organizational and operational arrangements, have been defined, and reviewed. In particular, detailed roles and responsibilities to assign financial management and procurement functions required by the project to this Administrative Unit vis-à-vis INE's Dirección de Administración y Servicios have been defined, reviewed and formalized in the project's Operational Manual. 3. Both the administrative and technical units of INE will be strengthened to meet the needs of the project. This will include additional personnel, specific technical trainings, and trainings on the fiduciary responsibilities under the project, among others. While an autonomous entity within the Government, INE is under the purview of the Ministry of Development Planning. Given its dependence on the MPD, INE will maintain MPD informed of the progress of activities under the project, sharing implementation status and financial reports, in addition to other reports or methods of communication defined between the INE and MPD. 4. Based on the on-going procurement assessment, INE has limited experience in Bank procurement, which will need to be strengthened for project implementation. Particularly, it lacks sufficient staff with the degree and depth of skills needed to implement a program that covers the entire procurement cycle, starting with the preparation of the procurement plan, the bidding process and contract administration. In the organizational chart recently sent by INE, the procurement unit reports directly to the Administrative Directorate. 5. A Project Operational Manual is being developed to define responsibilities and operational procedures among the participating agencies in terms of their financial management and procurement requirements. A draft version of the Manual is currently under joint review and revision by INE and the Bank. 42 Annex 7: Financial Management and Disbursement Arrangements BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Executive Summary 1. As part of the preparation process of the Bolivia Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project, the FM team has performed a financial management capacity assessment to determine the adequacy of INE's financial management arrangements to support project implementation. The assessment has been performed in accordance with Operational Policy/Bank Procedure 10.02 ­ Financial Management and the Manual "Financial Management Practices in World Bank Financed Investment Operations". The main purpose of this Annex is to spell out the main issues regarding financial management arrangements, including the required mitigating measures agreed with INE to address project needs. Overall conclusion 2. Project design is straightforward and does not require complex institutional arrangements. Although due to the nature of activities, it is expected a high volume of small transactions, activities under each component are clearly defined and a detailed programming and budget for the life of the project has been prepared. As implementing entity, INE has in place a sound financial and administrative structure, equipped with experienced and qualified staff and follows adequate and documented accounting and internal control procedures. Within such environment, and in order to ensure smooth project implementation, INE will establish and thereafter maintain throughout project implementation a technical unit responsible for census under the General Coordination Directorate and an administrative unit under the Administrative and Services Directorate, that would undertake overall responsibility for project financial management tasks, and to that end this unit will be strengthened with the contracting of qualified and experienced FM staff, both at central and regional level. INE's overall processes and procedures, information systems and internal control mechanisms have been adjusted and strengthened to adequately address project needs, and those arrangements have been reflected in the Operational Manual. However, a critical measure to ensure adequate operation of defined arrangements will be timely selection and contracting of key staff before project implementation begins. 3. With the information available as of the date of this document, project's residual inherent risk is rated substantial; similarly the FM control risk is rated substantial too, mainly because the proper operation of designed FM arrangements will highly depend on the timely appointment and hiring of qualified staff to ensure project implementation. 4. Based on the progress reached by INE in the design, definition and implementation of required arrangements, the proposed FM arrangement as described in this Annex and as reflected in the Operational Manual, subject to the timely contracting of key staff, are considered acceptable to the Bank. 43 SUMMARY OF FINANCIAL MANAGEMENT ASSESSMENT Risk assessment and mitigation 5. The risk assessment presented below, constitutes a summary of the issues considered for the project as a whole, based on the information provided in project documents, the FM capacity assessment, and it also takes into account the progress made by INE in putting in place the required arrangements. Risk Risk Risk Mitigating Measure Condition of Incorporated (or that needs to be Negotiations, Board or Residual incorporated) into Project Design Effectiveness (Y/N) Rating INHERENT RISK Country level Country's PFM risk Project will be implemented through Subsidiary Agreement rating (including sub- INE, a well established implementing to be signed between S national level) is agency, with the competence and the Ministry of substantial. experience in carrying out the activities Development Planning expected under the project. (MPD), the Ministry of Economy and INE, INE will be strengthened, both on the transferring technical and fiduciary side, making sure responsibility of project there are clear roles and responsibilities, implementation within the entity's structure for project implementation Effectiveness (Y) Severe salary constraints INE will establish and maintain Key FM positions to for the public sector limit throughout project implementation a strengthen the FM S the capacity to attract technical unit responsible for the census function within the and maintain qualified under the General Coordination Dirección de Censos staff, with subsequent Directorate, and an administrative unit have been agreed. . high staff rotation rates. under the Administrative and Services (Completed) Directorate fully dedicated to project implementation. Such Unit will be staffed with INE's experienced staff, and with professionals financed out of credit ToRs of key FM staff reviewed and approved proceeds. by the Bank, as part of the draft Operational Manual. Professional to be financed out of credit proceeds would have to be selected following Bank's procedures and fees would be determine in the framework of Key FM staff selected and hired before project the scale salary applied by INE for similar positions. implementation. 44 Risk Risk Risk Mitigating Measure Condition of Incorporated (or that needs to be Negotiations, Board or Residual incorporated) into Project Design Effectiveness (Y/N) Rating Entity level Lack of experience with INE has managed some external Key FM staff selected management and financed operations (mostly following and hired before project S administration of WB country systems). The entity would be implementation. financed projects. strengthened with hiring of professionals with expertise on external financed projects. Draft Operational Manual reviewed and approved by the Bank. Overall, INE has well-established processes and procedures, which have been strengthened to attend project (Completed) needs, including additional requirements resulting from WB policies and procedures. Project level Key project activities are The establishment of technical and Draf Operational (such as the census and fiduciary units within INE's structure Manual, detailing update of the allows having a full time dedicated team arrangements for all multipurpose carto- to ensure timely and smooth project project activities at graphy) are expected to implementation. central and regional be carried out level has been reviewed simultaneously; therefore and agreed. creating a huge demand INE has well established procedures to (Completed) on technical and operate through Regional Offices, fiduciary staff to ensure including mechanisms for the transfer of timely and smooth funds and respective documentation project implementation. process. Several activities would Staff needs to strengthen Regional require to be carried out Offices has been agreed and are included through Regional Offices in project budget/ that would undertake responsibility for certain contracting processes and administration of credit proceeds for certain activities. Inherent Risk S CONTROL RISK 45 Risk Risk Risk Mitigating Measure Condition of Incorporated (or that needs to be Negotiations, Board or Residual incorporated) into Project Design Effectiveness (Y/N) Rating Budgeting, Accounting; and Internal Control M INE will have to discuss and coordinate Draft Operational with the Vice Ministry of Public Manual reviewed and Investment and External Finance agreed with the Bank. INE has well defined (VIPFE) and the Ministry of Economy procedures for and Public Finance the timely recording budgeting, accounting of credit proceeds to avoid further delays (Completed) and internal control. in the start of project implementation, However, registration of both for counterpart and WB proceeds. credit proceeds for the first year of the project may result in delays if its incorporation is treated as a budget modification INE has established procedures in terms and this would delay the of budgeting, accounting, processes and beginning of proposed procedures (including internal control), activities. which respond to project needs, and which are reflected in the project While roles and Operational Manual. Operation of those responsibilitities have arrangements will require close follow- been clearly defined, up. participation of several instances, both within the General Coordination Directorate and the Administrative and Services Directorate, may in some cases lead to delays. Funds Flow: INE has As in the rest of the portfolio, funds flow Funds flow limited experience in arrangements will use the procedure set arrangements have been S WB disbursement under the Treasury Single Account reviewed, agreed and policies and procedures, (CUT) ­both in US dollar and local reflected in the as in the past managed currency, which is working well. Operational Manual. some minor projects, but not recently. INE's key FM staff has participated in a (Completed) Disbursement Workshop and the team Implementation of some will be strengthened with at least one project activities will professional with experience on external Customized SOE require considerable financed projects. format agreed with the transfer of funds to the Bank and to be Regional Offices to pay reflected in the training, per diem, and Taking into account the nature of project Disbursement Letter. field expenses for the transactions (high number of census brigades, as well transactions of small value), a 46 Risk Risk Risk Mitigating Measure Condition of Incorporated (or that needs to be Negotiations, Board or Residual incorporated) into Project Design Effectiveness (Y/N) Rating as some operating costs customized SOE format has been agreed with the Bank and it will be issued directly from the OPTIMIX System. INE has defined/established procedures and controls on the transfers of funds and accountability to/from regional offices, procedures and those are reflected in the project Operational Manual. Financial Reporting Specific content of the interim financial Content and format of reports has been defined so as to provide Interim Financial Although INE's M necessary information for monitoring Reports at the project information system purposes (component/sub-component). level have been defined (OPTIMIX), allows the and agreed with the recording of project Bank. transactions by project INE has in place adequate arrangements component and for the preparation of IFRs using the subcomponent, it does information provided by OPTIMIX. (Completed) not allow the direct Those mechanisms include the timely issuance of financial reconciliation with SIGMA reports; so reports, which will be as to ensure the integrity and reliability prepared manually in of financial information. Excel Spreadsheets, fully based on the information provided by OPTIMIX. Auditing M Audit arrangements and requirements Audit ToRs should be were discussed during FM capacity defined before assessment and those will be formalized Negotiations. in project documents. An acceptable audit firm selected six month after effectiveness. Control risk S OVERALL FM RISK S Key activities and action plan 6. As of the date of this document, INE has made significant progress in the definition and design of required financial management arrangements. However full implementation of some arrangements is in some cases in progress, and in others it will only be completed once the credit is effective. Key activities to be completed include: 47 Action Target date Organizational structure: (a) prepare terms of reference of key FM staff; and (b) Before project complete selection and contracting process before project implementation begins. implementation begins. Prepare audit terms of reference By Negotiations Complete appointment of external auditors Six months after effectiveness Financial management implementation arrangements Organizational arrangements and staffing 7. INE is a central government decentralized entity with administrative, technical and economic autonomy. As a decentralized entity, INE has to comply with the Government's financial management arrangements in terms of budgeting, accounting, internal controls, funds flow and financial reporting. Also, INE has developed additional administrative, financial, and internal control procedures, according to its needs and internal directives. Within INE, financial management tasks are under the responsibility of the "Dirección de Administracion y Servicios" that reports directly to the Executive Director, and which consists of three areas: i) Finance, ii) Administrative Services (which includes procurement and fixed assets); and iii) Human Resources and Training. 8. As described in section C of this PAD, project implementation will widely rely on exisiting INE's operational arrangements, strengthening them as needed to project needs. Within those arrangements, INE will establish and thereafter maintain a technical unit responsible for census ­under the General Coordination Directorate (Direccion de Coordinacion General) and an administrative unit under the Administrative and Services Directorate (Direccion de Administracion y Servicios-DAS). Within those arrangements, the DAS will undertake overall responsibility for financial amangement and procurement tasks, through the project administrative team. The Census Administrative Unit will include three areas: i) budgeting ii) accounting; and iii) treasury and disbursements all headed by a responsible officer and required professional. 9. At regional level, INE has eight Regional Offices whose staff mainly include a Regional Officer and an Administrative Professional; but given the increase workload and the high volume of decentralized activities and their related amount of transactions, the regional teams will be strengthened with the contracting of one procurement technician and a finance technician, basically to manage funds transferred under the project mainly to support the recruitment of the team/brigades process and the related payment of travel and per-diem expenses and preparation of the monthly payroll, as well as payment of local training and operating costs. 10. Roles and responsibilities of key financial management positions are defined in the Operational Manual, and terms of reference of key positions would be approved by the Bank. Selection of FM staff to be financed with credit proceeds would follow Bank's policies and procedures. 48 Programming and Budget 11. The preparation of the annual program and budget will follow local regulations established by the Ministry of Economy and Public Finance (MEFP)1, and specific regulations and instructions that may be issued by the Vice Ministry of Budget and Fiscal Accounting, and Vice Ministry of Public Investment and External Finance (VIPFE), as applicable. However, those general procedures will be complemented by some specific guidelines to be prepared for the project, including the preparation of an annual operating plan with at least semi-annual budget/cash flow for monitoring purposes. INE has clear procedures for planning, budget monitoring and record of commitments, which have been reflected in the project Operational Manual, including clear roles and responsibilities for annual program and budget preparation between the General Coordination Directorate (technical team) and the Administrative and Services Directorate (DAS), s. In order to allow an adequate budget control, agreed procedures provide for: 1) timely preparation of programming, budget and procurement plan, establishing a clear relation among them; 2) proper recording of the approved budget in the financial management system, not only following Government required programmatic structure and its classification by partidas por objeto del gasto, but also a classification by project component and cost category (as needed); and 3) timely recording of commitments, payments and accruals as needed, to allow an adequate budget monitoring and also provide accurate information on project commitments for programming purposes. Accounting ­ Information system 12. INE has to comply with the Governmental Accounting Standards. Therefore, the project would use the Chart of Accounts established by the Accountant's General Office (Dirección General de Contabilidad Fiscal) for decentralized entities. However, such chart of accounts would need to be complemented with a more functional classification including project components/sub-components, and additional classifications such as project activities. Project transactions and preparation of financial statements will follow the cash basis of accounting. 13. The project will benefit from the use of SIGMA (Government's integrated financial management system), and the Single Treasury Account (CUT in US dollars and local currency) to process payments. INE has in place a parallel information system (OPTIMIX), which allows them to comply with its internal information needs (including the issuance of entity's general purpose financial statements). OPTIMIX allows the recording of project transaction by source of financing, classifying project expenditures by "partidas por objeto del gasto" and project component and subcomponent, both in local currency and US dollars, with the subsequent issuance of budget execution reports by each of the above mentioned classifications. Those reports which are duly reconciled with budget execution from SIGMA, will be lately used for the preparation of interim financial reports, and customized Statement of Expenditures. INE has followed the proposed approach for other sources of financing; and to that end, the said process provides for adequate reconciling procedures which ensure the integrity and reliability of the information provided. 1 Law No. 2042, Supreme Decree No. 29881 dated January 7, 2009 ­ Regulations for Budgetary Modification. 49 Processes and procedures 14. INE has in place internal processes and procedures applicable to all its activities, which comply with local requirements related to administrative and control systems (SAFCO Law). On the basis of those procedures, INE has developed detailed processes and procedures for project implementation taking into account the proposed organizational structure, with a technical team under the General Coordination Directorate and the administrative under the DAS and taking into consideration the high volume of decentralized activities. To this end, INE has worked on specific flowcharts (flujogramas) for financial management tasks in temrs of payment processes for different type of project activities, transfer of funds to Regional Offices, including recording and control of inventories and fixed assets, preparation of withdrawal applications and financial reports. While the procedures detailed in the Operational Manual, provide for an adequate segregation of duties, mainly in terms of authorization and approval, avoiding duplication and unnecessary controls, they might become cumbersome and lengthy.Thus, this will require a close follow-up identify any required adjustments in a timely manner. 15. INE has also established an Internal Audit Unit, which on an annual basis issues a reliability report (Informe de Confiabilidad) on the entity's financial information. Taking into account that the internal audit unit may perform different kind of reviews ­as per the work program agreed with INE's Executive Director and approved by the Auditor's General Office- proposed project may be part of such review, although with limited scope. Financial reporting 16. Taking into account the considerations made in the Accounting- Information System section, it has been agreed that interim financial reports (IFRs) will be prepared manually in Excel Spreadsheets, on the basis of information provided by OPTIMIX (budget execution by project component and subcomponent). Those interim financial reports will specify sources and uses of funds, reconciling items (as needed) and cash balances, with expenditures classified by project component/subcomponent; and a statement of investments reporting the current semester and the accumulated operations against ongoing plans and footnotes explaining the important variances. The reports would include credit proceeds, and local funds as applicable. Those reports would be prepared and submitted to the Bank on a semester basis no later than 30 days after the end of each calendar semester. The reports would be prepared in local currency and US dollars. 17. On an annual basis, INE will also prepare project financial statements including cumulative figures, for the year and as of the end of the year. Those financial statements would include explanatory notes in accordance with International Public Sector Accounting Standards. Those financial statements, duly audited in accordance with Bank's requirements will be submitted to the Bank within the six months after the end of the Government's fiscal year (December 31). 18. Working papers for the preparation of the semester and annual financial statements will be maintained by INE and made easily accessible to WB supervision missions and to external auditors. 50 Audit 19. Annual audit reports on project financial statements, including management letter should be submitted to the Bank, within six months of the end of the Borrower's fiscal year (December 31). The audit should be conducted by an independent audit firm acceptable to the Bank and under terms of reference approved by the Bank. Audit cost would be financed out of credit proceeds and selection would follow standard Bank procedures. The scope of the audit would be defined by INE in agreement with the Bank based on project specific requirements and responding, as appropriate to identified risks. Audit requirements would include the following: Audit type Due date Project financial statements June 30 Special Opinions (Statement of Expenditures) June 30 FLOW OF FUNDS AND DISBURSEMENT ARRANGEMENTS 20. On a preliminary basis and following the general practice of the current portfolio, the following disbursement methods may be used to withdraw funds from the credit: (a) reimbursement, (b) advance, and (c) direct payment. 21. Under the advance method and to facilitate project implementation, a segregated Designated Account in US dollars would be opened and maintained by INE, who would have direct access to funds advanced by the Bank to the DA. Funds deposited into the DA as advances, would follow Bank's disbursement policies and procedures, to be described in the legal agreement and Disbursement Letter. 22. In keeping with current arrangements established by the Viceministry of Treasury and Public Credit for the operation and use of a Single Treasury Account in US dollars (CUT-ME)2, the Designated Account (DA) will be opened and maintained as a separate Libreta within the Single Treasury Account (CUT) in US dollars, which will also operate with a separate Libreta within the Single Treasury Account in Bolivianos, from which all payments and disbursements to beneficiaries' bank accounts will be processed. Specific processes and procedures for such operation will need to be detailed in the project Operational Manual. Funds will be transferred to the Regional offices on monthly basis from the Libreta within the Single Treasury Account in Bolivianos to a project separate bank account, managed trough revolving funds (one for each regional) established on SIGMA and on the estimated expenditures for two months, and subject to the regional offices monthly reports/justifications of actual expenditures. Disbursements from the WB (To be confirmed by LOA) 23. The ceiling (maximum amount) for advances to be made into the DA would be $4,000,000.00 (amount to be determined on the basis of project needs to cover the execution of 4 to 6 months). It is expected that eligible expenditures paid out of the DA be reported on a quarterly basis. 2 Supreme Decree No. 29236 dated august 22, 2007. 51 24. Requests for disbursements to the Government will be made on the basis of a customized Statement of Expenditure (SOE) that will reflect expenditures incurred by project component, subcomponent and "partida por objeto del gasto". 25. Additionally, OPTIMIX provides a break down by payment voucher, which together with supporting documentation would be maintained by INE for post-review and audit purposes. 26. Direct payments supporting documentation will consist of records, including copies of receipts, supplier/contractors invoices, etc.) 27. The minimum value for applications for direct payments and reimbursement will be $2 million. ALLOCATION OF CREDIT PROCEEDS Category Amount of the Percentage of Financing Allocated Expenditures to be (expressed in SDR) Financed (inclusive of Taxes) (1) Goods, Non-consultant 8,700,000 100% services, consultants' services Training and Operating Costs for Part 1 of the Project (2) Goods, Non-consultant 8,400,000 100% services, consultants' services, Training and Operational Costs s for Part 2 of the Project (3) Goods, Non-consultant 13,100,000 100% services, consultants' services, Training and Operational Costs for Part 3 of the Project (4) Goods, Non-consultant 900,000 100% services, consultants' services, Training and Operational Costs for Part 4 of the Project (5) Refund of Preparation 800,000 Amount payable Advance pursuant to Section 2.07 of the General Conditions TOTAL AMOUNT 31,900,000 28. Supervision strategy. The FM plans to perform at least two supervision missions per year, review the annual audit reports and the semiannual (semester) IFRs; as well as close follow-up up to project effectiveness to ensure proposed arrangements become fully operational and to also provide technical assistance to project staff. 52 Annex 8: Procurement Arrangements BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project A. General 1. Procurement for the proposed project will be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, both versions updated in October 2006 and May 2010, and the provisions stipulated in the Legal Agreement. The various items under different expenditure categories are described below. For each contract to be financed by the credit, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and timeframe, are agreed between the Recipient and IDA in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. An Operational Manual for the project is under preparation, and will include further details on the procurement processes and arrangements of the INE. At the writing of this document, a draft version of the Manual was provided to the World Bank, and is currently undergoing thorough review by the World Bank Procurement Team, after which the Team will advise and/or confirm the Manual's compliance with World Bank guidelines and requisites. 2. Procurement of Works: No civil works are envisaged. 3. Procurement of Goods and Non Consultant services: Goods procured under this project will include vehicles, IT equipment, etc., which are necessary for INE to carry out the censuses and surveys. Procurement of goods will be done using the Bank's standard bidding documents (SBD) for all international competitive bidding (ICB) procurement. For national competitive bidding (NCB) or Shopping (S) methods, documents agreed with or satisfactory to the Bank will be used. 4. Procurement of non-consulting services: The project will include logistics for training, censuses and survey related activities, printing materials, spots and promotional materials production, etc. No other non-consulting services are to be procured under the project. All non- consulting services will be procured in accordance with the Bank's Procurement Guidelines, as appropriate. This procurement also will be carried out using the Bank's SBD or National SBD agreed with or satisfactory to the Bank. 5. All procurement notices shall be advertised in the project's website, the Government's website (INE), and at least in one local newspaper of national circulation. ICB notices and contract award information shall be advertised in the United Nations Development Business online (UNDB online) and in the Development Gateway's dgMarket, in accordance with provisions of paragraph 2.60 of the Procurement Guidelines. 6. Selection of Consultants: Consulting Firms services will be contracted under this project in the following areas of expertise: statistics, training, and logistics. The procurement of consulting firms will be carried out using Bank's standard Request for Proposals (RFP). 53 International firms will have the opportunity to participate in about all solicitations above $100,000 USD. 7. Selection of Individual Consultant Services: Individual consultant services will be contracted mostly for Project Management and for technical advice, mainly in statistical methodology. "Service Delivery Contractors." This Project may involve hiring a large numbers of individuals who deliver services on a contract basis (for example, to carry out censuses and surveys by collecting information from households through a questionnaire, supervisors of surveyors, coordinators, etc.). The job descriptions, minimum qualifications, terms of employment, selection procedures, and the extent of Bank review of these procedures and documents shall be described in the project Operational Manual and the contract shall be included in the Procurement Plan to be approved by the Bank. 8. A project website, a Government website (INE), and a national newspaper shall be used to advertise expressions of interest as the basis for developing short lists of consulting firms and individual consultants, and to publish information on awarded contracts in accordance with the provisions of paragraph 2.28 of the Consultants' Guidelines and as mandated by local legislation. Contracts expected to cost more than $100,000 USD shall be advertised in UNDB online and in dgMarket. Shortlists of consultants for services estimated to cost less than $100,000 USD equivalent per contract may be composed entirely of national consultants, in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. 9. Operating Costs: The project will finance expenses for project administration. These expenses will include major project operating costs, including hiring personnel and procuring hardware and software. These operating costs will be administered in accordance with the Bank's Procurement Guidelines, as appropriate. This procurement also will be carried out using the Bank's SBD or National SBD agreed with or satisfactory to the Bank. 10. Others: None B. Assessment of the agency's capacity to implement procurement: 11. This section presents an assessment of INE regarding its implementation of the procurement to be conducted under the proposed project, and an action plan to enhance their procurement activities. A procurement assessment was initiated in May 23, 2010, and was finalized before and for negotiations. It has reviewed the organizational structure of INE and the proposed structure for implementing the project through the Census Coordination Unit under the General Coordination Directorate on the technical side, and through an Administrative Coordination Unit as part of the Dirección de Admisnistración y Servicios (DAS) that includes a Procurement Unit. It also has reviewed the interaction between the procurement officer and the technical implementing units within INE. 12. The assessment concluded that INE has limited experience in Bank procurement, resulting in a procurement unit that should be strengthened. Particularly, it lacks sufficient staff with the skills needed to implement a program of radical improvement in its procurement function, which covers the entire procurement cycle, starting with the preparation of the procurement plan, the bidding process and contract administration. In the organizational chart 54 recently sent by INE, the procurement unit reports directly to the Administrative Coordination Unit within the Dirección de Administración y Servicios. The Procurement Unit for Censuses and Surveys, will be fully staffed and operational no later than 90 days after the effectiveness date of the Financial Agreement. The procurement staff requires a level of experience adequate to assist the DAS in all the stages of the procurement cycle, not only in the preparation of bidding documents or securing quotations. A Project Operational Manual, detailing the responsibilities, procedures and guidelines for conducting project activities among the participating agencies in a manner satisfactory to IDA, will serve as a condition for signing of the Financial Agreement. 13. The Project is to be implemented by INE. INE will be the sole executing agency of the project. 14. The project's procurement aspects will be the responsibility of INE's DAS, whose specific responsibilities and operational procedures will be detailed in the Project's Operational Manual. The manual also will describe the flow of project coordination processes among the technical and administrative units within INE, including the Dirección de Administración y Servicios. INE has proposed to create an Administrative Coordination Unit within the DAS to manage project activities with a link to its own administrative structure, taking into account the project implementation plan. 15. Legal aspects. The Supreme Decree that rules Public Sector Procurement (Normas Básicas del Sistema de Administración de Bienes y Servicios, SABS), was established by Decreto Supremo No. 181, dated June 28, 2009, and its Reglamento del Subsistema de Contratación de Bienes y Servicios, dated August 27, 2007. 16. The main shortcomings of the Procurement Law include: (i) multiple exceptions for specific cases involved in the various procurement methods, and efforts to avoid open competition through ICB/NCB; (ii) authorization for government agencies to contract with other government agencies; (iii) an explanation of domestic preference that is in conflict with the text of Annex II of Bank Guidelines; (iv) open competition for the selection of consulting firms instead of short listing; (v) request of bid and performance guarantees for consultants; (vi) inadequate time to prepare bids; (vii) lack of an independent agency to review and resolve disputes. This means that bidders will have to go to the Administrative Court, meaning long delays and unknown results. 17. Furthermore, the law requires that Government agencies establish two different Evaluation Committees depending of the amount involved. In certain cases, this will mean too many approvals, with an emphasis on formalities and duplications that are not conducive to transparency. 18. In view of the deficiencies of the national legal framework for procurement and lack of procurement experience by INE, all project procurement should be made following Bank Guidelines and agreed procedures, including the Special Provisions detailed further below. 19. Organization and Staffing: INE's Administrative Coordination Unit under the DAS, whose specific responsibilities and operational procedures will be detailed in the Operational 55 Manual, will nominate a procurement specialist under TORs agreed or satisfactory to the Bank. The DAS also will confirm with the Bank, before the withdrawal of funds for goods, the proposed structure at the central level responsible for the implementation of its own procurement. At the time of the procurement capacity assessment, the unit did not have a procurement specialist with experience in Bank procurement procedures at the central office. 20. The responsibilities for implementing project procurement by the Procurement unit include : (i) prepare, execute and follow-up on the implementation of the Procurement Plan; (ii) prepare bidding documents and coordinate with the technical units for the preparation of TOR and technical specifications; (iii) participate in the Evaluation Committees, prepare bid evaluation reports, coordinate contract awards and coordinate the preparation of contracts; (iv) establish and keep up-to-date the contract administration system to include all contracts; (v) design a filing system to keep procurement records; (vi) prepare requests to the Bank for no­ objection requests; (vii) prepare and deliver a training action plan; and finally (viii) keep an information system for complaints and their resolutions. 21. INE will propose the structure to carry out certain procurement activities related to goods and consultant services. Based on the results of the assessment, INE will incorporate in its financial system a module for contract administration that will start with the procurement plan and supervision at different stages of the contracts. The system will be functioning before procurement begins. It also will establish, monitor, and supervise the filing system at all levels. 22. The key issues and risks concerning procurement for implementation of the project have been identified, and include principally the lack of experience in Bank procurement procedures. The overall project risk for procurement is high. The measures that have been considered to mitigate the above mentioned risks include: (i) a project Operational Manual, which is under preparation, including, inter alia, procurement and contracting procedures, which will be adopted as a condition of effectiveness of the Financing Agreement; (ii) INE will strengthen its procurement unit and will contract key staff for the project's Administrative Unit, including a senior procurement specialist as a withdrawal condition of the financing proceeds; (iii) the Financing Agreement will include additional provisions related to Particular Methods of Procurement; and, (iv) close monitoring by IDA, particularly during the first year of project implementation. The following table presents a detailed plan to mitigate the risks and to improve the agencies implementation capacity. Bank to review Action By whom By when3 and comment Establish and properly staff the procurement Within 90 days N.O. to TOR for unit with the structure and functions to plan, INE after key staff supervise, and execute procurement effectiveness Define functions, organization, and Within 90 days Subsidiary or INE relationship among DAS/Procurement Unit, after Inter- 3 Please note that these activities do not constitute a condition for effectiveness, rather merely identify expected dates for activities under the procurement action plan. 56 Technical Units, and INE effectiveness institutional Agreement Procurement Define the procurement work flow including Within 90 days processes and individuals with approval authority and INE after functions to be timetable (mapping of all steps) within INE effectiveness included in OM Finalize the procurement section of the OM, with detailed instruction on: (i) responsibilities and relationships between the various units involved in project Within 90 days procurement; (ii) individual responsibilities INE after Draft of the OM for approval and processing of key effectiveness procurement actions under the project; and (iii) specific section to include instructions and details of the process and responsibilities for procurement files. Negotiations Prepare a General Procurement Plan (for the and during Plan and first 18 months / 12 months) and update it as INE project updating necessary. implementation By Prepare the General Procurement Notice INE Proposed Notice negotiations Prepare standard bidding documents for Within 90 days Documents as ICB, NCB, Shopping and selection of INE after part of the draft consultants, and Standard formats for bid effectiveness OM evaluation. Draft of the Design / include procurement module in the Within 90 days proposed system current INE project MIS system, to monitor INE after or modification procurement plans, contract implementation effectiveness presented at and produce reports. Negotiations Include in the procurement section of the Financing Agreement: (i) the Special Provisions agreed for Bolivia; (ii) a requirement to use standard bidding Bank Negotiations Final Text documents agreed in advance with the Bank; (iii) that all project procurement will be made following Bank Guidelines and agreed procedures. Advertise invitations for all contracts, Invitations During project expressions of interest and contract awards INE should follow implementation through the Government's (INE) and the Bank's 57 project's web pages, and in a local Standard format newspaper with national distribution. For consultant services above $100,000 USD, the call for bids, the expressions of interest and contract award information should also be published in UNDB and dgMarket. Each March Submit to the Bank Procurement Audit INE 31st starting in Report reports carried out by Independent Auditors. 2011 C. Special Provisions 23. In addition to, and without limitation on any other provision set forth in this Schedule or the Procurement Guidelines, the following rules shall govern all procurement of goods and works under NCB: a. A merit point system shall not be used in the pre-qualification of bidders. b. The award of contracts for goods and Non-consultant services shall be based exclusively on price and, whenever appropriate, shall also take into account factors similar to those referred to in paragraph 2.51 of the Guidelines, provided, however, that the bid evaluation shall always be based on factors that can be quantified objectively, and the procedure for such quantification shall be disclosed in the invitation to bid. c. All bids shall be opened at the stipulated time and place in accordance with a procedure satisfactory to the Association. d. The single envelope procedure shall be used. e. Whenever a discrepancy shall occur between the amounts in figures and in the words of a bid, the amounts in words shall govern. f. No prescribed minimum number of bids shall be required to be submitted for a contract to be subsequently awarded. g. Foreign bidders shall be allowed to participate. h. Foreign bidders shall not be required to legalize any documentation related to their bids with Recipient's authorities as a prerequisite for bidding. i. No margin of preference shall be granted for any particular category of bidders. j. In the event that a bidder whose bid was evaluated as the bid with the lowest evaluated price withdraws its bid, the contract may be awarded to the second lowest responsive evaluated bid. k. Foreign bidders shall not, as a condition for submitting bids, be required to enter into a joint venture agreement with local bidders. l. No procurement rules or regulations of neither of the Recipient's agencies, including INE, nor of any state-owned entity shall apply without the prior review and consent of the Association. m. Recipient State-owned enterprises shall be allowed to participate in bids only upon their compliance with the provisions of paragraph 1.8 (c) of the Guidelines. 58 n. No contractor or supplier shall be denied fair and equitable treatment in any resolution of dispute with the Recipient and/or any of its executing agencies; and, o. Bidding documents for NCB shall include Anticorruption Clauses that shall be substantially identical to those pertaining to the Association/Bank Standard Bidding Documents for ICB. 24. In addition to, and without limitation on any other provisions set forth in this Schedule or the Consultant Guidelines, the following rules shall govern all procurement of consultant services referred to in this Schedule: a. As a condition for participating in the selection process, foreign consultants shall not be required to enter into a joint venture agreement with local consultants, unless the conditions stated in paragraph 1.12 of the Consultant Guidelines are met. b. As a condition for participating in the selection process, foreign consultants shall not be required to legalize their proposals or any documentation related to such proposals with Bolivian authorities. c. Foreign consultants shall not be required to be registered in the Borrower's National Registry of Consultants (Registro Nacional de Consultoría). d. Consultants (firms and individuals) shall not be required to present Bid and Performance securities as a condition to present proposals and sign a contract. e. No consultant firm or individual could be denied a fair and equitable treatment in its resolution of dispute with the Recipient's agencies. f. Requests for Proposals documents for shall include Anticorruption Clauses that shall be substantially identical to those pertaining to Bank Standard Bidding Documents. D. Procurement Plan 25. INE has prepared a procurement plan for project implementation based on existing information and the envisaged implementation of the project. This plan was discussed and agreed between the Borrower and the Project Team during Negotiations and will be available at INE's offices. It will also be available in the project's database and in the Bank's external website. The Procurement Plan will be updated semi-annually or as required by either the Borrower or the Bank to reflect the actual project implementation needs and improvements in institutional capacity. E. Frequency of Procurement Supervision 26. In addition to the prior review supervision to be carried out by Bank offices, the capacity assessment of INE has recommended semi-annually supervision missions, including field visits, post-reviews of procurement actions. 59 F. Details of the Procurement Arrangements Involving International Competition 27. Goods, Works, and Non Consulting Services (a) List of contract packages to be procured following ICB and direct contracting: 1 2 3 4 5 6 7 8 9 Revie w Expected Estimated Domestic Ref. Contract Procurement by Bid- Cost P Preference Comments No. (Description) Method - Bank Opening (000) (yes/no) Q (Prior Date / Post) 001 Computers March /20 & 1.680 ICB - No Prior 2011 011 equipment Office 002 equipment, March /20 336 ICB No Prior furniture & 2011 11 furnishings 003 March /20 Stationary 446 ICB No Prior 2011 11 004 Desk & March /20 office 748 ICB No Prior 2011 11 supplies 005 Materials & March /20 supplies 225 ICB No Prior 2011 11 2011 006 Materials & March /20 supplies 290 ICB No Prior 2010 11 2011 Printing of Sept questionnair 1.468 ICB No Prior 2011 es (b) ICB contracts for works estimated to cost above US$3.0 million and ICB contracts for goods estimated to cost above US$200,000 per contract and all direct contracting will be subject to prior review by the Bank. 60 28. Consulting Services (a) List of consulting assignments with short-list of international firms. 1 2 3 4 5 6 7 Review Expected Description of Estimated Ref. No. Selection by Bank Proposals Assignment Cost Comments Method Submission (Prior / US$ Post) Date (Information not available) (b) Consultancy services estimated to cost above US $100,000 per contract and all single source selection of consultants (firms) will be subject to prior review by the Bank. Individual consultants services to cost US$25,000 or above per contract or single source, regardless of the amount, will be subject to prior review by the Bank. (c) Shortlists composed entirely of national consultants: Shortlists of consultants for services estimated to cost less than US $100,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines. G. Thresholds for procurement methods and prior review Expenditure Contract Value Procurement Bank Prior Review Category (Threshold) (US$000) Method >3,000 ICB All 3,000>250 NCB First two each year 1. Works Shopping (Price <250 First two each year Comparison) Regardless of value DC. All. >200 ICB All 2. Goods 200>50 NCB First two each year <50 Shopping First two each year 61 Regardless of value DC. All. 3. Sub Projects <3 Shopping First two each year Regardless of value DC. All. 4. Agreements <50 Shopping First two each year Regardless of value DC. All. >100 QCBS All All TOR. QCBS, QBS, CQ, 5. Consultant <100 FBS, LCS (as per Selection Process Services Procurement Plan) reviewed twice yearly (Ex Post). All contracts awarded Regardless of value SSS under SSS. >25 IC All All TOR. Selection 6. Individual Process reviewed twice Consultants, <25 IC yearly (Ex Post). All other than contracts awarded under "Service SSS, and key personnel Delivery Contractors". All contracts awarded Regardless of value SSS under SSS, and key personnel Total value of contracts subject to prior review: US$ (No information available) Notes: ICB: International Competitive Bidding; NCB: National Competitive Bidding; QCBS: Quality-Cost Based Selection; QBS: Quality Based Selection; FBS: Fixed Budget Selection: LCS: Least-Cost Selection; CQS: Consultant Qualification Based Selection; SSS: Sole Source Selection 62 Annex 9: Economic and Financial Analysis BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project 1. The main objective is to strengthen the GOB's statistical capacity for the production of timely, quality statistics at both the national and local levels, to be used for evidence-based planning. As such, the characteristics of this project do not lend themselves to the standard calculation of economic rate of return. Given that the main objective is to improve the production and use of statistical information, the benefits from the project cannot easily be measured in monetary terms. 2. However, investment in equipment and human resources associated with this project is expected to generate tangible economic benefits. First, the availability of data from the agricultural and population and housing censuses will be for fundamental inputs to determine resource allocations across regions and levels of government, as well as for planning, designing, monitoring and evaluating public policies programs. This will help move the decentralization mandate of the CPE forward. Second, the improvements in the design and coverage of the continuous household survey will result in efficiency gains through representativeness at the departmental level and higher quality statistical outputs for given levels of resources. Third, improved data availability will enhance the potential for evidence-based decision making at the policy, program and project levels. Fourth, the project will help identify and address the significant costs of poor program management systems, such as low-effectiveness, low coverage of service delivery, and duplication of activities, among others. In addition, the public goods nature of national statistics and of monitoring results for accountability and transparency provides a strong rationale for public involvement in the statistical and M&E sectors and the financing of these types of operations. 3. The project is not amenable to standard financial analysis as national statistical and planning offices have very limited opportunities for significant cost recovery. Therefore, only marginal financial returns are expected from this project. However, there can be several fiscal impacts through savings generated by the GOB's increased ability to implement more effective programs. First, improvement in the design, collection and analysis of data will facilitate a more efficient budgeting process and public expenditure management. Second, greater use of administrative records for statistical purpose and streamlining of statistical operations would produce less labor-intensive statistical operations and potential savings in recurrent costs. Third, the allocation of government transfers to departments, municipalities, and native indigenous peasant communities based on actual (as opposed to projected) population data will result in a more efficient allocation of resources in general. The decentralization process envisioned by the CPE requires an increase in the transfer of resources on a per capita basis to more decentralized decision-making levels, so without updated and accurate data on population by locality this mandate will not be possible to implement efficiently. Fourth, the availability of reliable and credible statistical information is essential for the sustainability of the GOB's development agenda, which includes large agricultural irrigation and insurance programs, as well as for 63 adequate targeting of public policies and programs, for results-based management and for the verification of results. 64 Annex 10: Safeguard Policy Issues BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project 1. The indigenous population in Bolivia constitutes the majority of the population, accounting for approximately 51percent of the total, according to the 2007 household survey. This automatically triggers Operational Policy/Bank Procedure 4.10 - Indigenous Peoples safeguard. Nevertheless, a standalone Indigenous People Plan (IPP) is not required due to the nature of the project. In particular, the statistical information that will be obtained through the census and household survey is a public good, which is defined as a good that is both non- rivalrous (i.e. the consumption of the good by a person does not preclude or diminish the use that some other person can make of the same good) and non-excludable (i.e. it is not feasible or efficient to exclude anyone from consuming the good). 2. In the case of the census, its results will be both non-rivalrous and non-excludable, since every person will be able to share in the benefits of having updated information on the country's demographic, social, economic, and housing characteristics. As a result, the indirect beneficiaries of the project will be all the Bolivian people, the majority of whom are indigenous. Thus, there are no direct effects on the indigenous population, and thus no negative impacts anticipated. 3. As mentioned above, despite the fact that the indigenous population in Bolivia constitutes the majority of the population, their level of material well-being is lower than average for the population. For example, in 2007 the poverty rates in rural areas, where the indigenous population is disproportionately represented, were higher than at the national level: moderate poverty reached 77.3 percent of the rural population, while extreme poverty was 63.9 percent. Similarly, in the same year, the indigenous population registered above average poverty rates, with 66.5 percent and 47.4 percent in moderate and extreme poverty, respectively. 4. Since President Morales was elected in 2005, the new CPE was approved, which defines Bolivia as a Plurinational State with greater regional autonomy and a plural economy. In response to the historic exclusion of the indigenous population from the development process, the PND established as one of its objectives the eradication of social exclusion and strengthening the role of women and native indigenous populations in the construction of the new vision of the Plurinational State. The activities financed by this project will allow for the decentralization process envisioned by the CPE to move forward. 5. The current political situation is propitious towards more inclusive policies for indigenous people in Bolivia. As the first indigenous leader elected as President of Bolivia, the election of Evo Morales generated a sense of hope for the reduction of poverty and inequality. The current administration has been committed to mainstream inclusive policies towards indigenous people in the Bolivian policymaking process. A clear example of this mainstreaming process is the formulation of the PND. His re-election victory in December 2009, with 63 percent of votes, demonstrates his continued support from the population. 6. The formulation of the PND has received constant inputs and feedback from the four main rural and indigenous organizations. Among the organizations consulted are the Single 65 Confederation of Peasant Workers (Confederación Sindical Única de Trabajadores Campesinos), the Eastern Indigenous Confederation of Bolivia (Confederación Indígena del Oriente de Bolivia), the Ayllus and Markas, Aymaras and Quetchua Confederation, the National Confederation of Colonizers of Bolivia (Confederación Nacional de Colonizadores de Bolivia); and the Bartolina Sisa National Peasant Women Federation of Bolivia (Federación Nacional de Mujeres Campesinas de Bolivia Bartolina Sisa). 7. Previous national agricultural and population and housing censuses have been successfully collected in Bolivia with the assistance and participation of the population, including the indigenous population. INE already has started working on campaigns to increase public awareness of the importance of participating in both censuses. INE traditionally has relied on the local population to collect the census information. In particular, INE hires temporary census workers from among teachers and secondary school students in each community, who then are trained on data collection techniques. This helps increase the response rate among surveyed households since it is the community members who request the information. 8. INE has historically taken into account the major language barriers that members of some indigenous groups face if they do not speak Spanish, and has taken the appropriate steps to translate censuses and household questionnaires into the three main indigenous languages. In order to avoid excluding the participation by members of indigenous groups who do not speak Spanish, the past INE has translated the censuses questionnaires into Aymara, Cechua and Guaraní, which are the three most widely spoken indigenous languages, and will do so as well during the two censuses that will be financed by this project. 9. INE also has learned from past mistakes, including the proper formulation of census questionnaires to allow for the adequate and full identification of ethnic origin. Whether through self-identification or through the ability to speak or understand an indigenous language, INE has learned what works and what has not worked for adequate identification of ethnic origin from past experience and has adjusted the questionnaires accordingly. Thus, the census questionnaires will be culturally sensitive and will be amply tested in the field before the actual censuses are collected, in order to ensure participation by all indigenous groups. This will be facilitated by the fact that the persons collecting the information for the censuses and surveys are members of the local communities, who typically speak the same language. 66 Annex 11: Project Preparation and Supervision BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Planned Actual PCN review 11/28/2006 11/20/2007 Initial PID to PIC 08/07/2007 02/13/2008 Initial ISDS to PIC 02/14/2008 Appraisal 06/28/2010 06/28/2010 Negotiations 07/12/2010 11/08/2010 Board/RVP approval 09/23/2010 12/14/2010 Planned date of effectiveness 10/29/2010 03/01/2010 Planned date of mid-term review 10/29/2012 03/01/2012 Planned closing date 10/15/2014 03/01/2014 1. Key institution responsible for preparation of the project: As the project was initially envisioned as both a statistical capacity building and M&E project, it involved two implementing agencies ­ the Ministry of Development Planning (MPD) and the National Statistical Institute (INE). Based on the original design of the project, a PPF was approved in the amount of US$1.26 million to include both agencies. In the implementation of the PPF, all the resources remained with the MPD. The PPF remains active, although MPD has essentially limited expenditures since January 2010 to closing previous commitments. While many of the activities proposed under the PPF remain relevant and valid for the currently proposed project, it is unclear how much of the resources used by MPD under the PPF are directly related to the current project design. An audit is planned in the coming months to close the PPF, which is planned to end on December 31, 2010. It is expected that the audit will provide greater clarity on the links of expenditures under the PPF with the expenditures proposed under the current project design. 67 2. Bank staff and consultants who worked on the project included: Name Title Unit Rodrigo García-Verdú Economist LCSPP Indu John-Abraham Operations Officer LCSPP Pedro Fernandez Ayala ETC LCSPP José R. Molinas-Vega Senior Economist LCSPP Chris Parel Consultant LCSPP Julio Loayza Senior Economist LCSPE Lucy Bravo Language Program Assistant LCSPP Samuel Freije-Rodriguez Senior Economist LCSPP Mercedes Souza Consultant LCSPP Lourdes Consuelo Linares Sr. Financial Mgmt. Spec. LCSFM José Rasmussen ETC LCSPT Maria Lucy Giraldo Sr. Procurement Spec. LCSPT Shirley Foronda Finance Analyst CTRDM Estanislao Gacitua-Mario Lead Social Development Spec. LCSSO Jean-Jacques Verdeaux Sr. Procurement Specialist LCSPT Bank Funds Spent to Date on Project Preparation (US$) (July 2006 ­ June 2010) Bank resources $770,097 Total $770,097 Estimated Approval and Supervision Costs (US$) Remaining costs to approval $0 Estimated annual supervision costs $52,000 68 Annex 12: Documents in the Project File BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project A. Project Implementation Plan None yet B. Bank Staff Assessments Financial Management Assessment Procurement Capacity Assessment QAT Environmental and Social Comments on the PCN, PAD and associated Integrated Safeguards Data Sheet (ISDS) C. Other Project Concept Note Review Meeting Minutes: PCN, Decision Meeting Peer reviewer and other reviewer comments on project cycle documents Public Information Document Component reports prepared by World Bank staff and consultants Aide Memoires SMOs and BTOR Monthly Operational Summaries Project Appraisal Document 69 Annex 13: Bolivia Statement of Loans and Credits BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Difference between expected and actual Original Amount in US$ Millions disbursements Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev'd P106449 2008 BO-Emergency Rec and Disaster 0.00 16.90 0.00 0.00 0.00 12.13 4.11 0.00 Management P101426 2008 BO Lake Titicaca Local Sust Dev 0.00 20.00 0.00 0.00 0.00 17.58 13.31 0.00 P101298 2008 BO Participatory Rural Investment II 0.00 20.00 0.00 0.00 0.00 13.25 11.48 1.77 P101206 2008 BO-Exp. Access to Reduc Hlth Ineq 0.00 18.50 0.00 0.00 0.00 17.22 11.38 0.00 (APL3) P101084 2008 BO Investing in Children and Youth 0.00 17.00 0.00 0.00 0.00 15.72 7.90 0.00 P087925 2008 BO Land for Agricultural Dev 0.00 15.00 0.00 0.00 0.00 11.32 4.56 1.05 P083965 2008 BO-Secondary Education Transformation 0.00 10.00 0.00 0.00 0.00 4.27 2.13 0.00 P083979 2007 BO Urban Infrastructure Project 0.00 30.00 0.00 0.00 0.00 7.51 5.27 5.65 P083051 2005 BO Rural Alliances 0.00 58.40 0.00 0.00 0.00 34.09 -3.79 14.77 P073367 2003 BO Decent Infras for Rur Transformation 0.00 20.00 0.00 0.00 0.00 12.18 9.20 9.20 P068968 2002 BO Road Rehab. & Maintenance Project 0.00 77.00 0.00 0.00 0.00 19.13 3.54 22.14 Total: 0.00 302.80 0.00 0.00 0.00 164.40 69.09 54.58 70 BOLIVIA STATEMENT OF IFC's Held and Disbursed Portfolio In Millions of US Dollars Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic. 1995 BISA 0.00 0.54 0.00 0.00 0.00 0.54 0.00 0.00 1998 BISA 0.00 0.09 0.00 0.00 0.00 0.09 0.00 0.00 2003 Banco Los Andes 6.60 0.00 0.00 0.00 6.60 0.00 0.00 0.00 2003 Banco Sol 4.00 0.00 0.00 0.00 4.00 0.00 0.00 0.00 1999 CBTI 0.00 0.00 0.85 0.00 0.00 0.00 0.85 0.00 1994 COMSUR 0.00 0.00 1.30 0.00 0.00 0.00 1.30 0.00 1991 Central Aguirre 0.00 0.24 0.00 0.00 0.00 0.24 0.00 0.00 2001 Central Aguirre 1.69 0.00 0.00 0.00 1.69 0.00 0.00 0.00 1999 Electropaz 18.04 0.00 0.00 0.00 18.04 0.00 0.00 0.00 2003 FIE 1.25 0.00 0.00 0.00 1.25 0.00 0.00 0.00 1993 GENEX 0.10 0.00 0.00 0.00 0.10 0.00 0.00 0.00 1999 Illimani 3.84 0.00 0.00 0.00 3.84 0.00 0.00 0.00 Minera 0.00 3.40 0.00 0.00 0.00 3.40 0.00 0.00 2001 PQB 10.50 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2003 PRODEM 2.45 0.00 0.00 0.00 2.45 0.00 0.00 0.00 2003 TDE S.A. 12.72 0.00 15.00 0.00 12.72 0.00 15.00 0.00 TRECO 0.00 1.16 0.00 0.00 0.00 1.16 0.00 0.00 2001 Telecel Bolivia 3.33 0.00 5.00 1.43 3.33 0.00 5.00 1.43 2005 Transierra 45.35 0.00 0.00 86.05 45.35 0.00 0.00 86.05 Total portfolio: 109.87 5.43 22.15 87.48 99.37 5.43 22.15 87.48 Approvals Pending Commitment FY Approval Company Loan Equity Quasi Partic. Total pending commitment: 0.00 0.00 0.00 0.00 71 Annex 14: Country at a Glance BOLIVIA: Strengthening Statistical Capacity and the Informational Base for Evidence-Based Planning Project Bolivia at a glance 12/9/09 La t in Lo we r- P O V E R T Y a nd S O C IA L A m e ric a m iddle - Development diamond* B o liv ia & C a rib. inc o m e 2008 P o pulatio n, mid-year (millio ns) 9.7 565 3,702 Life expectancy GNI per capita (A tlas metho d, US$ ) 1,460 6,781 2,078 GNI (A tlas metho d, US$ billio ns) 14.1 3,833 7,692 A v e ra ge a nnua l gro wt h, 2 0 0 2 - 0 8 P o pulatio n (%) 1.9 1.2 1.2 Labo r fo rce (%) 3.2 2.2 1.6 GNI Gross per primary M o s t re c e nt e s t im a t e ( la t e s t ye a r a v a ila ble , 2 0 0 2 - 0 8 ) capita enrollment P o verty (% o f po pulatio n belo w natio nal po verty line) 65 .. .. Urban po pulatio n (% o f to tal po pulatio n) 64 79 41 Life expectancy at birth (years) 66 73 68 Infant mo rtality (per 1,000 live births) 46 22 46 Child malnutritio n (% o f children under 5) 6 5 26 Access to improved water source A ccess to an impro ved water so urce (% o f po pulatio n) 86 91 86 Literacy (% o f po pulatio n age 1 5+) 91 91 83 Gro ss primary enro llment (% o f scho o l-age po pulatio n) 108 1 17 109 Bolivia M ale 108 1 19 121 Lower-middle-income group Female 108 1 15 106 KE Y E C O N O M IC R A T IO S a nd LO N G - T E R M T R E N D S 19 8 8 19 9 8 2007 2008 Economic ratios* GDP (US$ billio ns) 4.6 8.5 13.1 16.7 Gro ss capital fo rmatio n/GDP 14.0 23.6 15.2 17.6 Expo rts o f go o ds and services/GDP 18.8 19.7 41.8 44.9 Trade Gro ss do mestic savings/GDP 9.6 10.7 22.7 24.5 Gro ss natio nal savings/GDP 6.9 12.8 27.3 27.7 Current acco unt balance/GDP -8.0 -7.8 12.1 12.1 Interest payments/GDP 2.6 1.9 1.5 1.1 Domestic Capital savings formation To tal debt/GDP 106.7 66.1 38.1 33.2 To tal debt service/expo rts 53.8 27.5 1 1 .7 10.3 P resent value o f debt/GDP .. .. 19.8 1 1 .7 P resent value o f debt/expo rts .. .. 41 .1 21 .3 Indebtedness 19 8 8 - 9 8 19 9 8 - 0 8 2007 2008 2 0 0 8 - 12 (average annual gro wth) GDP 4.3 3.6 0.0 6.1 2.6 Bolivia GDP per capita 1.9 1.6 -1.8 4.3 0.4 Lower-middle-income group Expo rts o f go o ds and services 7.3 8.7 3.3 2.2 0.8 S T R UC T UR E o f t he E C O N O M Y 19 8 8 19 9 8 2007 2008 Growth of capital and GDP (%) (% o f GDP ) 40 A griculture 17.2 14.7 12.9 13.5 Industry 34.0 30.4 36.4 38.4 20 M anufacturing 19.4 16.3 14.7 14.4 Services 48.9 55.0 50.7 48.2 0 03 04 05 06 07 08 Ho useho ld final co nsumptio n expenditure 79.0 75.1 63.2 62.2 -20 General go v't final co nsumptio n expenditure 1 1 .4 14.2 14.1 13.3 GCF GDP Impo rts o f go o ds and services 23.1 32.6 34.3 38.0 19 8 8 - 9 8 19 9 8 - 0 8 2007 2008 Growth of exports and imports (%) (average annual gro wth) A griculture 3.3 3.2 -0.6 2.6 18 15 Industry 4.8 4.0 8.2 10.6 12 M anufacturing 4.3 3.8 6.4 3.7 9 Services 4.0 3.1 -6.9 3.7 6 3 Ho useho ld final co nsumptio n expenditure 3.4 3.1 -2.0 5.5 0 General go v't final co nsumptio n expenditure 3.2 3.3 3.8 3.9 03 04 05 06 07 08 Gro ss capital fo rmatio n 9.6 -0.7 1 1 .4 29.3 Exports Imports Impo rts o f go o ds and services 7.2 4.5 4.8 9.4 No te: 2008 data are preliminary estimates. This table was pro duced fro m the Develo pment Eco no mics LDB database. * The diamo nds sho w fo ur key indicato rs in the co untry (in bo ld) co mpared with its inco me-gro up average. If data are missing, the diamo nd will be inco mplete. 72 Bolivia P R IC E S a nd G O V E R N M E N T F IN A N C E 19 8 8 19 9 8 2007 2008 Inflation (%) D o m e s t ic pric e s 20 (% change) Co nsumer prices 21.5 4.4 1 .7 1 15.5 15 Implicit GDP deflato r 18.2 7.1 12.3 10.4 10 G o v e rnm e nt f ina nc e 5 (% o f GDP , includes current grants) 0 Current revenue .. 24.4 33.8 35.2 03 04 05 06 07 08 Current budget balance .. 1.7 14.4 15.9 GDP deflator CPI Overall surplus/deficit .. -4.7 1.8 3.2 TRADE 19 8 8 19 9 8 2007 2008 Export and import levels (US$ mill.) (US$ millio ns) To tal expo rts (fo b) 543 ,1 1 04 4,458 7,258 8,000 Zinc 60 156 692 .. Silver 45 74 224 .. 6,000 M anufactures .. 279 584 .. 4,000 To tal impo rts (cif) 591 1,983 3,455 5,036 Fo o d .. 80 132 .. 2,000 Fuel and energy 5 99 266 .. Capital go o ds 232 944 899 .. 0 Expo rt price index (2000=100) 134 102 179 248 02 03 04 05 06 07 08 Impo rt price index (2000=100) 68 100 163 206 Exports Imports Terms o f trade (2000=1 00) 198 102 101 120 B A LA N C E o f P A Y M E N T S 19 8 8 19 9 8 2007 2008 Current account balance to GDP (%) (US$ millio ns) Expo rts o f go o ds and services 673 1,355 4,958 6,947 15 Impo rts o f go o ds and services 916 2,200 4,143 5,680 12 Reso urce balance -243 -845 815 1,267 9 Net inco me -260 -162 -489 -536 6 Net current transfers 137 340 1,266 1,284 3 0 Current acco unt balance -367 -667 1,591 2,015 -3 02 03 04 05 06 07 08 Financing items (net) 337 795 361 359 -6 Changes in net reserves 30 -128 -1,952 -2,374 M emo : Reserves including go ld (US$ millio ns) 144 ,1 1 83 5,308 7,906 Co nversio n rate (DEC, lo cal/US$ ) 2.4 5.5 7.9 7.2 E X T E R N A L D E B T a nd R E S O UR C E F LO WS 19 8 8 19 9 8 2007 2008 Composition of 2008 debt (US$ mill.) (US$ millio ns) To tal debt o utstanding and disbursed 4,905 5,614 4,993 5,537 IB RD 228 26 0 0 IDA 249 1,045 259 281 G: 166 B: 281 To tal debt service 372 433 741 947 IB RD 42 15 0 0 D: 1,530 IDA 3 9 2 3 Co mpo sitio n o f net reso urce flo ws Official grants 157 233 1,591 424 F: 3,058 Official credito rs 205 105 147 154 P rivate credito rs -65 108 240 343 E: 502 Fo reign direct investment (net inflo ws) -10 949 366 512 P o rtfo lio equity (net inflo ws) 0 0 0 0 Wo rld B ank pro gram Co mmitments 94 227 30 1 17 Disbursements 1 12 88 16 25 A - IBRD E - Bilateral P rincipal repayments 24 16 0 1 B - IDA D - Other multilateral F - Private C - IMF G - Short-term Net flo ws 88 72 16 24 Interest payments 21 8 2 2 Net transfers 66 64 14 22 No te: This table was pro duced fro m the Develo pment Eco no mics LDB database. 12/9/09 73 IBRD 33374 70°W 65°W BOLIVIA SELECTED CITIES AND TOWNS B R A ZI L DEPARTMENT CAPITALS NATIONAL CAPITAL To RIVERS Porto Velho n ã 10°S A bu MAIN ROADS RAILROADS Miles DEPARTMENT BOUNDARIES PA N D O s Riberalta Dio INTERNATIONAL BOUNDARIES Cobija de d re Ma 60°W Asunción Asunción Asunció This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information Guaporé shown on this map do not imply, on the part of The World Bank a Ya t Puerto Puerto Heath Group, any judgment on the legal status of any territory, or any endorsement or acceptance of such boundaries. Lago Lago Huaitunas Rogaguado id i M ad PERU BENI Magdalena i Lago Ben Rogagua Santa Ana Lago de a San Luis cum Ya oré Reyes Pa e er San ra Mam Ap gu Apolo Trinidad Trinidad Ma á San Borja a S Bl rtín 15°S L A PA Z n 15°S an Mig co uel Puerto Puerto Acosta Lago Nevada Caranavi oa Ascenció Ascención Ascención Titicaca Illampu Ich To G Puno (6,362 m) Concepción Concepció Concepción ra n Qu de San Ignacio PAZ LA PAZ iqui (G re ua Las Petas pa Nevada pa ha bey Ya Guaqui Viacha Viacha Illimani y) C Ich pa (6,462 m) il COCHABAMBA ca o ni Cochabamba Montero S A N TA C R U Z Desaguadero José San José de Chiquitos Oruro Santa Cruz To Nevada Sajama Roboré Roboré C C C Arica (6,542 m) Aiquile o o o ORURO rd rd rd Co i il i Banados del lll e r rd r Lago Izozog Puerto Puerto Sucre Santa r Poopo Suárez Suá Suárez i lll l Salar de Ana aco l l Coipasa Tarabuco Tarabuco Ch er Ce r r Potosí Potosí To n nt Pil Campo ra t t co Grande ra To G may a a 20°S Iquique l 20°S Oc Salar de Carniri Carniri o HU C Uyuni QU cid Uyuni PA R A G U AY Pacific Ocean i i ISACA enta ila P ya n n POTOSÍ To Mariscal CHILE Villa Montes Villa Estigarribia l l l Tarija Tarija TA R I J A de Lípez e d Gran To Yucuiba Yucuiba Calama iljazó Viljazón Viljazón To Tartagal To BOLIVIA Abra Pampa 0 50 100 150 Kilometers To San Ramón de la Neueva Orán 0 50 100 Miles ARGENTINA 70°W 65°W 60°W SEPTEMBER 2004