IEG Report Number: ICRR14766 ICR Review Independent Evaluation Group 1. Project Data: Date Posted: 06/23/2015 Country: Romania Project ID: P100638 Appraisal Actual Project Name: Complementing Eu Project Costs (US$M): 69.8 24.4 Support For Agricultural Restructuring Proj L/C Number: Loan/Credit (US$M): 65.0 23.3 Sector Board: Agriculture and Rural Cofinancing (US$M): Development Cofinanciers: Board Approval Date : 11/27/2007 Closing Date: 06/30/2013 09/30/2014 Sector(s): General agriculture; fishing and forestry sector (68%); Central government administration (20%); Sub-national government administration (12%) Theme(s): Rural policies and institutions (29%); Rural markets (29%); Land administration and management (14%); Rural services and infrastructure (14%); Other rural development (14%) Prepared by: Reviewed by: ICR Review Group: Coordinator: Katharina Ferl J. W. Van Holst Christopher David IEGPS1 Pellekaan Nelson 2. Project Objectives and Components: a. Objectives: The Project Appraisal Document (PAD) for the “Complementing EU Support for Agricultural Restructuring Project (CESAR) states that the Project Development Objective (PDO) was “to facilitate market-based farm restructuring through enhancing the ability of farmers, farm family members, and farm workers to manage their assets and income” (p. 4). According to the Loan Agreement of December 28, 2007 (p. 4) the objective of the project was “to assist the Borrower to facilitate market-based farm restructuring through enhancing the ability of farmers, farm family members, and farm workers to manage their assets and income”. The objectives stated in the Loan Agreement will be used as the basis for this validation. b.Were the project objectives/key associated outcome targets revised during implementation? Yes If yes, did the Board approve the revised objectives/key associated outcome targets? Yes Date of Board Approval: 03/14/2011 c. Components: Component 1: Land Administration [appraisal estimate € 34.01million (US$46.52 million), actual €8.50 million (approx. US$10.9), 25% of appraisal estimate ]: This component was to finance technical assistance to complete property rights determination and registration of land assets in rural areas through providing legal services for title registration, conducting surveys, implementing parcel delimitation, digitalizing legal and cadastral documents and upgrading the existing Information Technology (IT) system for registration and cadaster. Also, activities included institutional strengthening and capacity building within the National Agency for Cadaster and Land Registration (ANCPI) and the Country Offices for Cadaster and Land Registration (OCPIs). The building of regional archiving centers and renovating existing offices was also planned. Component 2: Socio-Economic Guidance Services to the Agricultural Population [appraisal estimate € 7.76 million (US$10.5 million), actual €7.58 million (approx. US$9.7 million), 98% of appraisal estimate ]: This component was to finance the development and capacity building of independent socio-economic guidance service providers to improve the agricultural population’s access to information on agricultural production, household, family and social economic relations beyond the farm. Also, this component included conducting outreach and community information activities to beneficiaries and establishing information networks between socio-economic guidance service providers and other advisory service providers in the agricultural sector. Component 3: Policy, Strategy and Management [appraisal estimate € 4.45 million (US$6.05 million), actual €2.87 million (approx. US$3.7 million ), 43% of appraisal estimate ]: This component was to finance technical assistance to the ANCPI and the Ministry of Agriculture and Rural Development (MARD) in the area of project management, fiduciary, and monitoring and evaluation (M&E). Also, this component was to finance technical assistance to the development of an Information System for Agricultural and Forestry (SIAS) and issuing studies in different areas including land consolidation and rural physical planning. During the restructuring in March 2011 all three components were revised (see section 2d). d. Comments on Project Cost, Financing, Borrower Contribution, and Dates: Project Cost: The CESAR project was estimated to cost €51.36 million (US$ 69.8 million). Actual cost was €18.95 million (approx. US$24.4 million), 37% of appraisal estimate. The actual cost was significantly lower due to a cancellation of €4.3 million (approx. US$ 5.9 million) on March 14, 2011, the early closing of Component 1, which left € 25.3 million (approx.. US$ 36.2 million) unused. Financing: The project was financed by a €47.70 million (US$ 65 million) International Bank for Reconstruction and Development loan of which €4.3 million (approx. US$ 5.9 million) was cancelled and €25.3 million (approx.. 36.2 million) unused and subsequently cancelled. Borrower Contribution : The borrower was to contribute €3.70 million (approx. US$ 5.0 million). Actual contribution was €0.95 million (approx. US$1.2 million) due to budget constraints as a result from the global financial crisis in 2009. Dates: The project was restructured three times, but without changes in the PDO. 1. On March 14, 2011 the following changes were made which resulted in a substantial reduction in costs:  The target of PDO indicator 1 (“percentage increase in land transactions in project areas”) was reduced from 20% to 15% and for PDO indicator 2 (“percentage of agriculture land registered in the National Farm registry in project area”) from 85% to 70% to be more realistic for the limited time remaining for project implementation.  Component 1: (a) the targets for several key performance indicators under Component 1 were reduced. (i) The new target for systematic registration was reduced from 1.27 million hectares to 0.7 million hectares of rural land in 15 judets (jurisdiction or county with a capital town of which there are 41 in Romania) ; (ii) the completion of systematic registration was delayed from year two to year four/five of project implementation; (iii) due to higher costs for systematic registration, the total amount of funds allocated for systematic registration would be used; (b) several planned activities that were not regarded as essential for the completion of the systematic land registration were cancelled such as the upgrading and implementation of the existing Information Technology (IT) system for registration and cadaster, building of regional archiving centers, and renovating existing offices.  Component 2: (a) all targets under component 2 were rescheduled and substantially reduced to reflect the delays in the project implementation and the reduction of the scope of the socio-economic guidance activities; (i) the percentage of the agricultural population with access to trained socio-economic guidance providers in project areas was reduced from 75% to 65%; (ii) the number of guidance services offices by region/county was decreased from 20 to 15; (iii) the number of bidders per contract was decreased from four to three; (d) the number of trained and graduated (certified) advisers was decreased from 250 to 80; (iv) the number of individuals assisted in project areas decreased from 15,000 to 9,000; and (v) the number of individual guidance plans elaborated by advisors with beneficiaries in project areas was decreased from 10,000 to 4,500; (b) the scope of the initially planned socio-economic guidance activities under component 2 was reduced; (c) financial support for scaling up the Integrated Agricultural Offices (IAO) was introduced; (d) €1.04 million (approx. US$1.4 million) was reallocated to Component 3 to support the institutional reform agenda of MARD.  Component 3: (a) €1.9 million (approx. US$2.6 million) was reallocated to Component 1 for systematic registration activities; (b) all other funds were re-designated towards addressing issues which were identified during a review of MARD.  Adaptations to Safeguards policies were made since civil work activities were cancelled under this restructuring and OP 4.01 (environment) was no longer triggered. Also, after discussion with the Regional Safeguards Coordinator, it was agreed that OP 4.36 (Forests) should no longer be triggered.  €4.3 million (approx. US$5.9 million) of the IBRD Loan was cancelled. 2. On June 26, 2013 the closing date for components 2 and 3 was extended from June 30, 2013 to June 30, 2014 due to uneven implementation progress. Due to the lack of funding from the government for component 1 and therefore the likelihood of not achieving its objectives, the closing date for component 1 was not extended and €25.3 million (approx. US$ 36.2 million) was unused. This amount was then cancelled on November 19, 2013. 3. On May 26, 2014, the closing date for components 2 and 3 was extended from June 30, 2014 to September 30, 2014 in order to allow the review and submission for approval of final deliverables under all consultant contracts by the implementing agency to MARD. Given that close to 100% of the project's disbursements occurred after the first restructuring when major changes were made, IEG decided that a "split" evaluation of the project's outcome is not warranted. 3. Relevance of Objectives & Design: a. Relevance of Objectives: Substantial: The PDO was substantially relevant because, following Romania’s access to EU membership, farmers could only benefit from the Common Agricultural Policy (CAP) if their farm size was above 1 hectare (see PAD, footnote 2, page 2). At appraisal average farm size of the 50 target communes for this project was close to 0.7 hectare which was typical of the vast majority of holdings in Romania agriculture and the main factor limiting rural development. A market-based restructuring of Romania’s small scale farming sector leading to an increase in average farm size was therefore needed. However, land sales to facilitate restructuring could only occur if farm titles were registered. Hence improving institutions responsible for facilitating land registration was necessary to achieve restructuring of small-scale farming, although facilitation was not defined in either the PAD or the legal agreement. In parallel to the increased registration of land the project was also aimed at assisting farmers to “manage their assets and incomes” to facilitate market-based farm restructuring. According to the PAD (paras 12 and 13 ) the PDO was in line with Romania’s draft post-accession strategy (2007 -2013), the overall National General Cadaster Program, and the National Strategic Plan for Rural Development (2007-2013). The project was also in line with the Bank’s Country Assistance Strategy (2007-2009) at the time of appraisal, which aimed “to shift agricultural policy towards completing the land reform process by securing land tenure, and promoting efficiency and competitiveness” (PAD, para 8). The Bank’s current Country Partnership Strategy (2014-2017) identified that at appraisal less than 50% of real estate rights were registered in cadaster records and only 15% of real estate documents were verified and recorded in the digital eTerra system (Country Partnership Strategy, p. 54). Therefore, one of the pillars of the Bank’s current Country Partnership Strategy focuses on increasing growth and competitiveness by improving the efficiency of agriculture underlining the continued relevance of the PDO . b. Relevance of Design: Modest: The causal relationships between activities in the project's components and the PDO were logically explained in the PAD, but the results chain was not well reflected in the results matrix in the PAD (p.31). Project components designed to strengthen the National Agency for Cadastre and Land Registration (ANCPI), the County Offices for Cadaster and Land Registration (OCPIs), socio-economic guidance services to the agricultural population (including capacity building for the providers of these services), as well as the provision of outreach and community information activities, and the establishment of informational networks between these providers and other providers of advisory services in the sector were well defined and relevant to the PDO. Specific activities to improve land administration including parcel delimitation, surveys, legal services for title registration, digital conversion of legal and cadastral documents and maps, upgrading of the IT systems for OCPIs, and building regional offices defined in the PAD were also relevant to the PDO. However, some of these activities such as the upgrading of the IT system, building of regional archiving centers and renovating existing offices were cancelled during the project restructuring in March 2011 as they were regarded by the Government as not essential (Restructuring paper March 2011, p.6). These cancellations seriously undermined the extent to which the project’s objectives could be achieved. 4. Achievement of Objectives (Efficacy): The project’s objective was to ”assist the Borrower to facilitate market-based farm restructuring through enhancing the ability of farmers, farm family members, and farm workers to manage their assets and income”. For the purpose of assessing the project’s achievements, two sub-objectives were defined, namely (a) to assist the Borrower to facilitate market-based farm restructuring; and (b) enhancing the ability of farmers, farm family members, and farm workers to manage their assets and income. (a) To assist the Borrower to facilitate market -based farm restructuring - Substantial Outputs:  By June 2013, 67.2% of communes in the project counties digitized land books, and 71.2% of communes digitalized land books by September 2014, not achieving the original target of 100%.  10 integrated agriculture offices were established and equipped, surpassing the target of four offices.  75% of landowners, where land surveys were completed, participated in consultations, surpassing the original target of at least 50%.  Registration costs as percentage of property values in project areas decreased from 0.4% in 2008 to 0.15% in 2014  The average time needed to complete the registration of transactions/transfers in the project area decreased from 21 days in 2008 to 16.8 days in June 2013 and 16.3 days in September 2014, not achieving the target of 15 days.  While it took on average two days in 2008 to produce a certified copy of a title, it took approximately 1.7 days in 2014, surpassing the target of two days. The target for this indicator was achieved.  By June 2013, 57,049 hectares of rural land in the project area was registered in the land book (when component 1 was closed) and 177,795 hectares by September 2014 (when the project closed), which did not achieve the original target of 1.27 million hectares nor the revised target of 700,000 hectares.  73% of land in the project area was registered in the National Farm Registry when the project closed, surpassing the revised target of 70%. The original target was 85%. Outcomes:  Land transactions in project areas increased by 49.2% between 2008 and June 2013 (when component 1 was closed) and by 52.5% between 2008 and September 2014 (when the project closed), both surpassing the original target of 20% and the revised target of 15% (ICR, Data Sheet, PDO 1, page vii). It was also a substantial improvement on land transactions in the three years before systematic registration of land (ICR, page 12). (b) Enhancing the ability of farmers , farm family members , and farm workers to manage their assets and income - Substantial. Outputs:  More than 75% of rural households in the project area were informed about socio-economic guidance services surpassing the revised target of 75%, the original target was 90%.  22 guidance service offices were established in 16 different project counties, surpassing the revised target of 15 offices. The original target was 30.  A handbook for socio-economic guidance based on best practices by the European Union was developed, achieving the target.  275 advisors were trained, surpassing the revised target of 80 advisors. The original target was 300 advisers.  25,600 individuals in the project area were assisted with socio-economic guidance services, surpassing the original target which was reduced from 25,000 individuals to 9,000.  13,000 individual guidance plans were developed by counselors with beneficiaries from the project area, surpassing the revised target of 4,500 plans. The original target was 25,000.  98.8% of the eligible agriculture population in project areas had access to support programs, surpassing the original target of 75% and the revised target of 60%.  In 2011 and 2012 some 634 people from the ANCPI, County Offices for Cadaster Registration, municipalities and the private sector were trained in different areas including social communication and mediation. Outcome:  82% of the agriculture population in the project area evaluated socio-economic guidance providers as useful, surpassing the original target of 70% (ICR, Data Sheet, PDO 3, page vii). 5. Efficiency: Negligible: The economic analysis of CESAR in the PAD (para 68) assumed that the project will contribute to a more effective use and increased absorption of the European Union Common Agriculture Policy (CAP) funds and national funds for agriculture. The PAD noted that the analysis assumed that the project’s benefits would result from its positive impact on (a) increased property values, (b) improved environment, and (c) reduced land transaction costs. Estimating the magnitude of the project's impact on property values and environment is a complex undertaking that depends on numerous non project related factors. In similar Bank operations in the region no attempt was made to estimate them at project start-up (para 70). The PAD estimated that large scale cadaster operations financed by CESAR and implemented by ANCPI would cost $15 per ha compared with $144 per ha charged by private cadaster services. Hence there was a minimum saving of $129 per ha which for the 1.07 million ha covered by the project area generated a minimum saving (benefit) by the project of $138 million. The PAD also estimated that the internal rates of return for these cost savings (including an estimated $17 million for the implementation of cadaster services) were 13% and 21% for 30 and 20 year time horizons (Annex 9, para 7). The PAD also estimated financial benefits to farmers based on an analysis of four CAP farm support programs and their revenues resulting from the project's socio-economic guidance and land property registration. The estimated financial benefits came to approximately US$167.2 million compared with investment and interest costs were estimated at US$78.8 million. On this basis the financial internal rate of return was calculated to be 68% (PAD, Annex 9, para 14). The ICR (p. 37) estimated the economic internal rate of return on the cadaster and registration activities as 7% over a 30 year horizon and 10% over a 20 year horizon. In addition, the ICR also estimated a net present value of cadaster cost savings of €209,295 (approximately US$290,920) over a 30 year time period and €179,105 (approximately US$248,955) over a 20 year time period, assuming a very low discount rate of 8%. Contrary to assertions in the ICR (page 34), only one of these results was reflected in Table 1 of Annex 3 in the ICR. The ICR also estimated that, based on the additional revenues from CAP programs "The financial return on the investment is highly negative, with losses in all years through to year 20. The NPV at an 8% discount rate is estimated to be EUR -7.0 million over a 20 year horizon" (p. 36). Other measures of the project's efficiency include land registrations and the time taken to transact the registrations. The ICR concluded that extravillan rural land registered increased, mainly sporadically, from 470,366 hectares in January 2010 to 2,551,033 hectares in mid-2013 (a 442% increase). This compared with the change in the six finalized project communes from 2,105 hectares in 2010 to 21,673 hectares in 2013 (a 929% increase) which was a substantially larger percentage increase than for Romania as a whole (ICR, page 35). As already noted in Section 4 of this Review, the ICR stated that the average time required for registering a land transaction was reduced from 21 days in 2008 to 16.3 days in 2014 but this fell short of the target of 15 days, although the ICR suggests that the difference is not statistically significant (page 14). The rates of return estimated in the ICR are not only considerably below those estimated in the PAD, they are also either very low or negative. While the number of land transaction registrations in the project area increased at a much higher rate than in non-project areas, the average time required to complete the registration of transactions during project implementation declined by only 22 percent (see Section 4 of this Review). There is no evidence in the ICR that suggests even modest overall efficiency of the project's implementation. Efficiency is therefore rated negligible. a. If available, enter the Economic Rate of Return (ERR)/Financial Rate of Return (FRR) at appraisal and the re-estimated value at evaluation : Rate Available? Point Value Coverage/Scope* Appraisal Yes 68% 66% ICR estimate Yes 7% 45% * Refers to percent of total project cost for which ERR/FRR was calculated. 6. Outcome: Close to 100% of the project's disbursements occurred after restructuring. A "split" evaluation of the project's outcome was therefore not warranted. The relevance of the project's objective was rated substantial, but the relevance of design was rated modest. The project generally met its original and revised PDO indicators and on this basis the efficacy with which the market-based restructuring and the socio-economic guidance were achieved was rated substantial. On the other hand, there were significant shortcomings in the efficiency with which the project was implemented reflected by the very low estimates in the ICR of the economic internal rate of return for the cadaster and registration activities and only a 22 percent reduction in the time required to complete the registration of land transfer transactions. Efficiency was therefore rated negligible. Overall, the achievement had significant shortcomings and the project's outcome was therefore rated moderately unsatisfactory. a. Outcome Rating: Moderately Unsatisfactory 7. Rationale for Risk to Development Outcome Rating: The capacity building of the ANCPI was undermined by the cancellation of the upgrading of the existing IT system for registration and cadaster, building of regional archiving centers and renovation of existing offices. However, the ICR noted that ANCPI has subsequently become a stronger institution with a clear vision (p. 17). It is developing a comprehensive plan for the systematic registration of contracts, which will be financed by a potential €250 million EU Structural Fund. In addition, this support will be followed by a Bank project (“Real- Estate-Basis for National and EU Policies”), which is intended to strengthen the ANCPI's capacity to improve its policy, regulatory and institutional framework. On the other hand activities under the socio-economic guidance services component will not be continued by MARD since its agriculture development strategy under the NRDP 2014 to 2020 will focus on a smaller group of approximately 130,000 commercial small-holder and large scale farms. On balance, assuming that market-based restructuring will receive renewed support, risk to development outcome is rated moderate. a. Risk to Development Outcome Rating : Moderate 8. Assessment of Bank Performance: a. Quality at entry: This project continued its support for improvements in land administration (General Cadastre Project which closed mid-2006. CESAR was designed to complement Romania’s draft post-accession strategy for 2007 to 2013, the overall National General Cadaster Program, and the National Strategic Plan for Rural Development for 2007 to 2013. During appraisal the Bank conducted a review of institutional, legal and administrative frameworks and took experience from other countries into account. The Bank identified relevant risk factors during preparation, such as the government not providing sufficient funds for project implementation. The Bank tried to mitigate this risk by including in the loan a covenant that the government will ensure its yearly contributions throughout project implementation. However, the Bank’s mitigation effort was not sufficient and activities under components 1 and 3 had to be reduced during the project restructuring in March 2011. Also, component 1 had to be closed in June 2013 due to the lack of government funding. According to the ICR (p.7) the Bank did not identify the risk of technical shortcomings in law no. 7/1996 (cadaster and land registration), which aimed to minimize the risk of land title disputes going to court. This led to delays in project implementation. Also, even though the Bank was aware of difficulties between the ANCPI and MARD in the past, as stated in the PAD (p.12), the project design did not provide for mitigation measures. According to the ICR (p.20) the Bank team did not recognize that MARD was not interested in the implementation of Component 2 due to the component’s lack of compatibility with MARD’s vision for the delivery of agricultural advisory services. The Results Framework had several weaknesses (see section 10a). Quality-at-Entry Rating: Moderately Unsatisfactory b. Quality of supervision: According to the ICR (p.19) the Bank team included specialists from different areas. The Bank team developed annual procurement plans which were used to track developments. According to the ICR (p.20) the Bank supervised financing, disbursement, safeguards and fiduciary aspects well. Also, the Bank worked with the government and the ANCPI on building an effective administrative system for land registration and shared best practices. The Bank team did not provide the MARD with the necessary information to completely understand the purpose of the socio-economic guidance providers’ process and how to align it with the MARD’s vision of a chambers of agriculture, which led to its discontinuation (ICR, p.20). The Bank revised the Results Framework in the March 2011 Project Paper and advised the implementing agencies to make additional modifications in April 2013 to ensure that indicators reflected progress towards PDOs, but a formal revision was not undertaken by the implementing agencies (ICR, p.10). Quality of Supervision Rating : Moderately Satisfactory Overall Bank Performance Rating : Moderately Unsatisfactory 9. Assessment of Borrower Performance: a. Government Performance: The project experienced implementation delays due to the Government’s administrative difficulties related to a public debt ordinance and late approval of the draft law on ratification of the loan agreement at the beginning of the project. Due to these delays the land registration and socio-economic guidance could not be aligned with the introduction of the European Union's common agriculture policy payments, as originally planned. Also, the government experienced a high turnover of staff and ministerial leadership within ANCPI and MARD. The ICR states that during implementation the Ministry of Public Finance, the Ministry of Administration and Interior, the Ministry of Rural Development and Tourism, the General Secretary of the Government, and the Ministry of Regional Development and Public Administration were "disengaged from project activities and insufficiently aware of their economic and financial importance" (p. 18). In March 2011, the project had to be restructured due to delays in the implementation and withdrawal of national budgetary funds. In June 2013, the project had to be restructured again due to the government’s failure to comply with the Bank’s request for a formal commitment and proof of further financing. Lack of budget in the ANCPI had already led to a decrease in rolling out the second round of administrative territorial units for systematic registration from 72 additional units to 31 units. According to the ICR (p. 4), the government showed a "lack of commitment to provide adequate financing for Component 1 (Land Administration)" but expressed a strong interest in the continuation of the implementation of Components 2 ( Socio-Economic Guidance Services to the Agricultural Population) and Component 3 (Policy, Strategy and Management)". The government eventually decided to not release the necessary budget to complete the systematic registration process for contracts. Component 1 was therefore closed on June 30, 2013, while implementation of Components 2 and 3 continued. Government Performance Rating Unsatisfactory b. Implementing Agency Performance: Ministry of Agriculture and Rural Development (MARD) and component 3 was implemented by both agencies. ANCPI: Moderately Satisfactory According to the ICR (p. 20) ANCPI was strongly committed to the implementation of component 1 despite challenges in regards to governance, employment conditions, policy failures, and budget limitations. ANCPI experienced three changes in governance structure throughout the implementation period. ANCPI successfully implemented a legal framework supporting land registration and a process for the national systematic registration of agriculture land. Also, capacity within the ANCPI was built, and the institution’s vision became clearer through the implementation of this project. However, most targets under component 1 were not achieved due to reasons beyond ANCPI’s influence. MARD: Moderately Unsatisfactory MARD experienced a high turn over in leadership and had six different ministers throughout the implementation period. According to the ICR (p. 21) MARD was committed to the implementation of activities under Component 3, which supported the development of integrated agriculture offices and the preparation of the National Rural Development Plan. However, MARD decided not to incorporate the approach for socio-economic guidance into the National Rural Development Plan for 2014 to 2020. In April 2013 the Bank developed a methodological guidance on all indicators included in the Results Framework, however, both implementing agencies did not make any changes to their M&E implementation. Also, there was little coordination between the two implementing agencies and lessons learned were not shared between them. Implementing Agency Performance Rating : Moderately Satisfactory Overall Borrower Performance Rating : Moderately Unsatisfactory 10. M&E Design, Implementation, & Utilization: a. M&E Design: The M&E system was based on a previous Bank project’s M&E system within ANCPI. MARD developed an M&E system and incorporated data from socio-economic guidance providers. The proposed data collection methods and analysis were appropriate for this project. The M&E design included three surveys, a baseline, a mid-term, and an end-of-project survey. Both implementing agencies were responsible for monitoring and evaluation activities. MARD was responsible for consolidating the results into progress reports on a biannual basis and into evaluation reports on a yearly basis to be submitted to the Bank and the project steering committee. The objective to “facilitate” farm restructuring was rather vague and weakly defined in the PDO and Intermediate Outcome Indicators (IOIs). The Results Framework in the PAD (p. 31) included three PDO indicators and 22 IOIs. M&E design had several shortcomings including the (a) the three PDO indicators and many of the IOIs were weakly linked to the PDO; and (b) the Results Framework included a large number of IOIs that were to be tracked on a regular basis. While most indicators were measurable in quantitative terms, most of them measured the achievement of outputs rather than outcomes. b. M&E Implementation: As already stated in section 2d, during the restructuring in March 2011, the target values for two PDO indicators and several intermediate outcome indicators were reduced to be more realistic for the limited time remaining for project implementation. According to the ICR (p.9) the proposed baseline, mid-term and end-of-project surveys were not included in the project budget and therefore only partially implemented. A social survey was conducted in 2008 during project preparation to provide a baseline. The follow up survey, which was supposed to take place in 2013, was not conducted due to a shortage of funds for Component 1. Also, according to the ICR (p.10) three IOIs were not monitored due to the lack of budget to fund additional surveys. The ICR does not specify which IOIs were affected. Also, four IOIs, namely IOI 14 (“guarantee fund established”), IOI 15 (“ANCPI legal charter reviewed”), IOI 16 (“ANCPI long-term strategic plan and first business plan developed”), and IOI 17 (“land consolidation policy note discussed in the steering committee”) were not tracked since related project activities were not implemented. According to the ICR (p. 10) the required progress reports were prepared on a quarterly basis and were of good quality. c. M&E Utilization: According to the ICR (p. 10) M&E data allowed for tracking of progress towards the PDOs and informed decision-making. However, the ICR provided no examples. M&E Quality Rating: Modest 11. Other Issues a. Safeguards: The project was rated as environmental category B under OP 4.01 (environment) due to building renovation and construction and OP 4.36 (forest) due to positive social and economic benefits of the project on forests. An Environmental Management Plan was prepared and disclosed during project preparation. During the restructuring in March 2011 the civil work activities under component 1 were canceled, therefore OP 4.01 was no longer triggered. It was also decided that OP 4.36 should no longer be triggered since the impact of the project on forests was mainly indirect. Therefore, a revised Integrated Safeguard Data Sheet was developed and disclosed on February 24, 2011. b. Fiduciary Compliance: Financial Management The ICR (p. 20) states that the Bank supervised fiduciary aspects such as project financing and disbursement well. Staff for financial management was hired for ANCPI’s project management unit at the beginning of the project and staff attended a Bank course to learn about the procedures required by the Bank. The ICR does not comment on the adequacy of the project’s institutional financial management arrangements, reporting and accounting provisions, internal control procedures, planning and budgeting, flow of funds arrangements and external audit reporting. Procurement The ICR (p.20) states that procurement challenges were quickly addressed by the Bank. Also, annual procurement plans were developed to track developments. Procurement staff was hired at the beginning of the project and attended a Bank course to learn about procurement procedures required by the Bank. The ICR does not comment on the extent to which Bank procurement guidelines were followed, and if there were any significant implementation delays due to procurement challenges. c. Unintended Impacts (positive or negative): None d. Other: None 12. Ratings: ICR IEG Review Reason for Disagreement/Comments Outcome: Moderately Moderately Unsatisfactory Unsatisfactory Risk to Development Moderate Moderate Outcome: Bank Performance: Moderately Moderately Quality at entry was rated Moderately Satisfactory Unsatisfactory Unsatisfactory on the basis of inadequate assessment of project risks, and the lack of recognition that activities in component 2 were not in line with the long-term objectives of MARD. Borrower Performance : Moderately Moderately Unsatisfactory Unsatisfactory Quality of ICR: Satisfactory NOTES: - When insufficient information is provided by the Bank for IEG to arrive at a clear rating, IEG will downgrade the relevant ratings as warranted beginning July 1, 2006. - The "Reason for Disagreement/Comments" column could cross-reference other sections of the ICR Review, as appropriate. 13. Lessons: The ICR (p. 23) identifies several lessons, but some were not based on material in the ICR: 1. Memoranda of Understanding are necessary to ensure effective collaboration among institutions . In this project, there was little coordination between ANCPI and MARD and lessons learned by one implementing agency, which could have been useful for the other implementing agency as well, were not shared between them. 2. During project design , the government’s policies should be carefully evaluated to ensure that the project objectives complement /support those policies . In this case, the implementation of the socio-economic guidance services were negatively impacted since MARD was not provided with the necessary information to understand how these services could be aligned with MARD’s vision of a chambers of agriculture. 14. Assessment Recommended? Yes No 15. Comments on Quality of ICR: The ICR provides a good overview of project implementation. However, it had several shortcomings: (i) the ICR rates the outcomes of the project against components rather than objectives; (ii) the ICR should have provided more information on critical areas such as M&E design and utilization, financial management and procurement, and how challenges in procurement were addressed by the Bank and the implementing agencies; (iii) some lessons learned were not based on material in the ICR. The ICR is nevertheless rated satisfactory but only marginally so. a.Quality of ICR Rating : Satisfactory