The World Bank
    Somalia Recurrent Cost & Reform Financing Project - Phase 2 (P154875)




                                                                                     REPORT NO.: RES35834

                                     DOCUMENT OF THE WORLD BANK




                                         RESTRUCTURING PAPER
                                                  ON A
                                   PROPOSED PROJECT RESTRUCTURING

                                                      OF

                  SOMALIA RECURRENT COST & REFORM FINANCING PROJECT - PHASE 2
                                      APPROVED ON JUNE 25, 2015
                                                      TO

                                     FEDERAL REPUBLIC OF SOMALIA


GOVERNANCE

AFRICA EAST




                           Regional Vice President:    Hafez M. H. Ghanem
                                 Country Director:     Keith E. Hansen
                                 Regional Director:    Asad Alam
                       Practice Manager/Manager:       Nicola J. Smithers
                              Task Team Leader(s):     Zubair Khurshid Bhatti, Alma Nurshaikhova
           The World Bank
           Somalia Recurrent Cost & Reform Financing Project - Phase 2 (P154875)



I. BASIC DATA

Product Information

Project ID                                                   Financing Instrument
P154875                                                      Investment Project Financing

Original EA Category                                         Current EA Category
Not Required (C)                                             Not Required (C)

Approval Date                                                Current Closing Date
25-Jun-2015                                                  30-Jun-2022




Organizations

Borrower                                                     Responsible Agency
Federal Republic of Somalia                                  Ministry of Finance, Federal Republic of Somalia




Project Development Objective (PDO)
Original PDO
The Development Objective of the project is to support the government to provide credible and sustainable payroll and
to establish the foundation for efficient budget execution and payment systems for the non-security sectors in FGS and
eligible interim and emerging states.
Current PDO
To support the Federal Government of Somalia and Eligible Federal Member States to strengthen resource
management systems, the inter-governmental fiscal framework, and service delivery systems in health and education.
Summary Status of Financing (US$, Millions)


                                                                                     Net
Ln/Cr/Tf                 Approval         Signing Effectiveness       Closing Commitment Disbursed Undisbursed

IDA-D3780              25-Sep-2018   31-Oct-2018   05-Feb-2019    30-Jun-2022          60.00      48.41          11.23
TF-A8244               25-Sep-2018   31-Oct-2018   05-Feb-2019    30-Jun-2022           2.00        2.00             0
TF-A6971               15-Feb-2018 12-Mar-2018 12-Mar-2018        30-Jun-2022          35.00      35.00              0
        The World Bank
        Somalia Recurrent Cost & Reform Financing Project - Phase 2 (P154875)



TF-A0534             29-Jun-2015    29-Jun-2015       02-Jul-2015    30-Jun-2022       51.00      51.00                 0


Policy Waiver(s)

Does this restructuring trigger the need for any policy waiver(s)?
No


I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES

 This restructuring seeks an amendment to the Grant Agreement between the Federal Republic of Somalia (the
 “Recipient”) and the International Development Association (the “World Bank”) for the Somalia Recurrent Cost and
 Reform Financing Project Phase Two Project – RCRF II (Grant number TF0A8244), to enable replenishment of project
 funds by US$10 million.

 The Somalia Multi-Partner Fund has been designed using a basket-funding mechanism by establishing a multi-donor
 trust fund. A grant of US$144 million was approved by the Regional Vice President on June 25, 2015 and became
 effective on July 2, 2015. An initial commitment of US$10 million was made. Five other such replenishments, with the
 most recent one of US$20 million brought the total commitment amount to US$86 million. The current restructuring,
 with the first amendments to the Grant Agreement of TF0A8244, will bring the net commitment amount to US$96
 million.

 Current Project Status. The project has disbursed US$88 million from MPF (100% of the signed amount of US$ 88
 million) and US$48.41 million (81%) of the IDA grant to date. The activities under the project have accelerated and
 current disbursement requirements warrant an amendment to the Grant Agreement governing TF0A8244 for another
 replenishment of funds.

 Proposed Changes. There are no other changes to the project apart from the request to amend the Grant Agreement
 TF0A8244 to facilitate replenishment of the grant by ten million US Dollars (US$10 million).

 There are no outstanding audits under the project.




II. DETAILED CHANGES