The World Bank Iran COVID-19 Emergency Response Project (P173994) REPORT NO.: RES46649 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF IRAN COVID-19 EMERGENCY RESPONSE PROJECT APPROVED ON MAY 26, 2020 TO THE ISLAMIC REPUBLIC OF IRAN HEALTH, NUTRITION & POPULATION MIDDLE EAST AND NORTH AFRICA Regional Vice President: Ferid Belhaj Country Director: Saroj Kumar Jha Regional Director: Keiko Miwa Practice Manager/Manager: Rekha Menon Task Team Leader: Son Nam Nguyen The World Bank Iran COVID-19 Emergency Response Project (P173994) ABBREVIATIONS AND ACRONYMS COVID-19 Coronavirus Disease 2019 CT Computed Tomography E&S Environment and Social EUR Euro FMFA Financial Management Framework Agreement GoIRI Government of the Islamic Republic of Iran PDO Project Development Objective TPVA Third-Party Verification Agency UN United Nations WHO World Health Organization The World Bank Iran COVID-19 Emergency Response Project (P173994) BASIC DATA Product Information Project ID Financing Instrument P173994 Investment Project Financing Environmental and Social Risk Classification (ESRC) Substantial Approval Date Current Closing Date 26-May-2020 31-May-2021 Organizations Borrower Responsible Agency The Islamic Republic of Iran World Health Organization Project Development Objective (PDO) Original PDO To improve the availability of selected essential, life-saving medical equipment for COVID-19 response. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-91160 26-May-2020 14-Jun-2020 16-Jun-2020 31-May-2021 50.00 51.51 .14 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Iran COVID-19 Emergency Response Project (P173994) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING PROJECT STATUS: 1. Implementation: The project is on track to achieve its objective. Both progress towards the Project Development Objective (PDO) and overall Implementation Progress were rated ‘Satisfactory’ by the Mid-Term Review in March 2021 and in the Implementation Status and Results report in May 2021. The environment and social (E&S) assessment was completed for all selected health facilities. Out of a total of 182 beneficiary health facilities (137 hospitals and 45 laboratories), all have been categorized as ‘green flag’ indicating ‘ready’ facilities. 100 percent of the procured equipment has been delivered to the beneficiary facilities and 98 percent have been installed. Training on the use of equipment has been completed for 95 percent of the equipment. 2. The World Health Organization (WHO), which is the project implementing agency, has submitted comprehensive progress reports for the project’s first three quarters, from mid-June 2020 to mid-March 2021 in a timely manner. The Third-Party Verification Agency (TPVA) has also fulfilled its verification mandates so far, with one last TPVA report pending. It is important to note that the project has delivered more equipment than its original plan. This is due to an efficient procurement process that resulted in savings that allowed the acquisition of additional equipment from the positive list. In total, 451 medical equipment and 8.7 million laboratory kits for COVID-19 response have been procured under the project. The number of beneficiary facilities also increased from 159 in the original plan to 182. 3. Disbursement: All project funds (EUR 45,685,000) have been utilized as of March 8, 2021. The interim unaudited financial reports for the project’s first three quarters (mid-June 2020 to mid-March 2021) have been submitted. The full utilization of funds within nine months of effectiveness demonstrates the project’s commendable efficiency and responsiveness to the crisis. 4. Audit: Under the Financial Management Framework Agreement (FMFA), the World Bank is relying on the audit carried out by the WHO/United Nations (UN) audit oversight committee that is appointed under UN rules and regulations, based on the “Single Audit Principle”. This arrangement satisfies the World Bank audit requirements. The World Bank Iran COVID-19 Emergency Response Project (P173994) RATIONALE FOR RESTRUCTURING: 5. Iran’s current COVID-19 wave, which started in end-March 2021, is the biggest since the onset of the pandemic. The country saw the highest number of daily new cases (20,000 – 25,000) in April 2021 and an increased number of deaths. This slowed down completion of pending tasks despite the efforts of the WHO, the Government of the Islamic Republic of Iran (GoIRI) and beneficiary facilities by the current closing date of May 31, 2021. This also affected the ability of the TPVA to complete the verification. So far, the TPVA has conducted verification for 196 pieces of equipment (with 8 pieces subject to the implementation of corrective actions). They are yet to complete the verification of the remaining 255 pieces of equipment and review the progress of the identified corrective actions, which was hampered by the current wave. 6. Given the above, the GoIRI, in consultation with WHO and the World Bank team, have requested an extension of the project closing date by two months, from May 31, 2021 to July 31, 2021. The proposed extension will allow completion of all pending tasks and reports. II. DESCRIPTION OF PROPOSED CHANGES 7. Extension of the Closing Date: The project closing date is being extended from May 31, 2021 to July 31, 2021. The implementation schedule is correspondingly being updated with new timelines for the completion of installation and training for all the procured equipment and corrective measures as identified by the TPVA as well as the submission of the Final Project Progress report from WHO and the Final TPVA report. III. SUMMARY OF CHANGES Changed Not Changed Loan Closing Date(s) ✔ Implementation Schedule ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ The World Bank Iran COVID-19 Emergency Response Project (P173994) Overall Risk Rating ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IBRD-91160 Effective 31-May-2021 31-Jul-2021 30-Nov-2021 .