Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) CG Rep. Support to Economic Diversification Project (P118561) AFRICA | Congo, Republic of | Trade & Competitiveness Global Practice | IBRD/IDA | Specific Investment Loan | FY 2011 | Seq No: 11 | ARCHIVED on 29-Mar-2016 | ISR22921 | Implementing Agencies: Key Dates Key Project Dates Bank Approval Date:16-Dec-2010 Effectiveness Date:13-Sep-2011 Planned Mid Term Review Date:16-Nov-2015 Actual Mid-Term Review Date:17-Jun-2013 Original Closing Date:28-Feb-2016 Revised Closing Date:16-Feb-2017 Project Development Objectives Project Development Objective (from Project Appraisal Document) The objective of the Project is to promote private sector growth and investment in the non-oil sectors in the Republic of Congo. Itwill focus in particular on SMEs and the Pointe Noire-Brazzaville growth corridor, which is the most important and immediate sourceof economic growth and diversification. Has the Project Development Objective been changed since Board Approval of the Project Objective? Yes Board Approved Revised Project Development Objective (If project is formally restructured)PHRPDODEL The objective of the project is to promote private investment in select non-oil value chains and to support Small and Medium Enterprises (SME) development. Components Name Support to Public Private Dialogue (PPD) and Investment Climate Reforms: TA to improve PPD, improve the investment climate and stren gthen the instit framework to support enterprises and investments:(Cost $4.30 M) Support to Enterprise Development and Investment Promotion: aimed at supporting access to non financial and financial services.:(Cost $8.40 M) Support to the reform of the railway company: This component will assist the Government in implementing a strategy to improve the op erations and services of the railway company, CFCO:(Cost $2.70 M) Project Coordination and Implementation:(Cost $3.60 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Satisfactory 3/29/2016 Page 1 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) Overall Implementation Progress (IP)  Moderately Satisfactory  Satisfactory Overall Risk Rating  Substantial  Substantial Implementation Status and Key Decisions The task team conducted a deep supervision mission from Feb 1 to Feb 15 2006, during which extensive consultations took with all stakeholders to agree on the priorities for the next 6 months. PADE displayed strong results and visible impact. PADE results and impact assessment. The projet PDO which is «To promote private investment in select non-oil value chains and to support SME’s competitiveness therein», has the following two (2) results indicators over the lifetime of the project : (i) 300 SME supported by the project with 50% achieving performance indicators (ii) USD 50 million in aggregate investment amount supported by the project. To date, the project supported 412 SMEs, 383 or 92% of which have reached or exceeded their performance indicators. SMEs supported to date represent 137% of the overall result target of the project. For the second indicator, the project supported $70 million in private investment, or 140% of target result objective with strong evidence of results attributable to project interventions. An intermediate result indicator related to DB reforms is to help eliminate 85 procedures across 7 DB indiators to reduce cost and time. To date, the project helped reduce 65 procedures across 6 DB indicators, with 30 reform texts, 9 of which have been adopted. In 2011, RoC was ranked 183/185. Today it is 176/189 despite falling behind 2 spots in DB 2016. Still, RoC has a very long way to go and immense efforts must be deployed to change the reform dynamic in order to see a more radical improvement of the country’s ranking in DB report. PADE’s results and impact. The mission team recognizing the critical role played by the PIU, would have recommended to revise the project rating from MU to S, had it not been for the disbursement rate currently sitting at 42%, which on the basis of contract under implementation is projected to reach 60 % in June 2016. A follow up mission will take place then to reassess. Pursuing teh Economic Diversification Agenda in RoC. Noting that Economic Diversification is an imperative that requires continuous WBG engagement and decisive and coordinated actions on the part of the government, the mission emphasized to RoC that in order to accelerate the effective implementation of the economic diversification program and maximize the impact of WBG intervention and other partners, it is critical for RoC to demonstrate a solid commitment to: (i) a strong political will (ii) closely coordinated government action (iii) a permanent and dynamic Public-Private dialogue and, (iv) a robust project delivery mechanism for project implementation. For its size and lifespan, PADE’s impact on economic diversification could only be that of providing blueprints and pilots for demonstration effects on activities that require scaling up for a global impact. The project value add is in: (i) providing the necessary framework and tools to aggressively pursue business reforms through a permanent and strong public private dialogue (ii) contributing a large body of knowledge and expertise across the spectrum of economic diversification issues to inform decision-making by policymakers and private investors (iii) conducting for demonstration effect, scalable and result-driven pilot experiments on SME competitiveness, value chain development, investment promotion, strategic partnerships and industry-based training and employability. The dichotomy of low disbursement rate v. high results. The DR is the default proxy for a project delivering results. Yet in the case of PADE, the project has exceeded its PDO results indicators a year ahead of schedule with a 42% DR. This is largely due to two (2) assumptions made during the project design phase: (i) An average grant of 150k per beneficiary SME of the Matching Grant (the largest disbursing activity representing 70% of IDA financing,) whereas the actual average grant per SME is below 50k (ii) A lack of quality local non-financial services, putting a premium on consulting services during the design phase. In reality, at least 75% of the consultants or firms used in the matching grant are local, costing much less. A positive unintended but welcomed consequence is that this situation allows the project to have a more significant impact than initially envisaged by affecting a larger number of beneficiaries as results have shown. Key takeaways from the mission debriefing session with the government : (i) the need for PADE to get ministries more closely involved in implementation activities (iii) the need to urgently adopt the short term DB measures submitted to the Government in January (iv) the need to further assist the Permanent Secretary of the PPD Council in accelerating the implementation of PPD reform agenda with the recruitment of a Deputy Permanent Secretary and by providing administrative and operational support (v) the need for PADE to have a more proactive, community based communication strategy. 3/29/2016 Page 2 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  High  High Macroeconomic  --  Moderate  Moderate Sector Strategies and Policies  --  Moderate  Moderate Technical Design of Project or Program  --  Moderate  Moderate Institutional Capacity for Implementation and Sustainability  --  Substantial  Substantial Fiduciary  --  Substantial  Substantial Environment and Social  --  Substantial  Substantial Stakeholders  --  Substantial  Substantial Other  --  --  -- Overall  --  Substantial  Substantial Results 3/29/2016 Page 3 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) Project Development Objective Indicators PHINDPDOTBL  Percentage of SMEs, out of all SMEs supported by the project, that achieved agreed upon target performance indicators (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 45.00 93.00 75.00 Date 11-Oct-2013 29-Feb-2016 29-Feb-2016 16-Feb-2017 PHINDPDOTBL  Aggregate private investment amount supported by project activities in select non-oil value chain. (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 78000000.00 80000000.00 50000000.00 Date 11-Oct-2013 01-Jun-2015 10-Mar-2016 16-Feb-2017 Overall Comments Project successfully reached and exceeded PDO result indicators. Details included in mission Aide memoire attached in this ISR Intermediate Results Indicators PHINDIRITBL  Number of Doing Business indicators that have been reformed to improve the country’s business environment (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 5.00 6.00 7.00 Date 30-May-2013 01-Jun-2015 10-Mar-2016 16-Feb-2017 PHINDIRITBL  Number of overall procedures that have been reduced in the five Doing Business indicators where the country is ranked least. (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 10.00 65.00 80.00 Date 01-Jan-2013 01-Jun-2015 10-Mar-2016 16-Feb-2017 3/29/2016 Page 4 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) PHINDIRITBL  Aggregate incremental sales for SMEs supported by the project (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value -- -- 37000000.00 50000000.00 Date 01-Jan-2013 01-Jun-2015 10-Mar-2016 16-Feb-2017 PHINDIRITBL  Number of SMEs benefiting from non financial services (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 280.00 412.00 300.00 Date 04-Dec-2013 01-Jun-2015 10-Mar-2016 16-Feb-2017 Overall Comments Project results and impact assessment. The projet PDO which is «To promote private investment in select non-oil value chains and to support SME’s competitiveness therein», has the following two (2) results indicators over the lifetime of the project : (i) 300 SME supported by the project with 50% achieving performance indicators (ii) USD 50 million in aggregate investment amount supported by the project. To date, the project supported 412 SMEs, 383 or 92% of which have reached or exceeded their performance indicators. SMEs supported to date represent 137% of the overall result target of the project. For the second indicator, the project supported $70 million in private investment, or 140% of target result objective with strong evidence of results attributable to project interventions. An intermediate result indicator related to DB reforms is to help eliminate 85 procedures across 7 DB indicators to reduce cost and time. To date, the project helped reduce 65 procedures across 6 DB indicators, with 30 reform texts, 9 of which have been adopted. In 2011, RoC was ranked 183/185. Today it is 176/189 despite falling behind 2 spots in DB 2016. Still, RoC has a very long way to go and immense efforts must be deployed to change the reform dynamic in order to see a more radical improvement of the country’s ranking in DB report. Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P118561 IDA-48460 Effective XDR 6.40 6.40 0.00 2.82 3.58 44% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P118561 IDA-48460 Effective 16-Dec-2010 03-Feb-2011 13-Sep-2011 28-Feb-2016 16-Feb-2017 Cumulative Disbursements 3/29/2016 Page 5 of 6 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report CG Rep. Support to Economic Diversification Project (P118561) Restructuring History Level 1 Approved on 24-Feb-2014 Related Project(s) There are no related projects. 3/29/2016 Page 6 of 6 Public Disclosure Copy