Document of The World Bank FOR OFFICIAL USE ONLY Report No: PAD3782 INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT PROJECT PAPER ON A PROPOSED ADDITIONAL LOAN IN THE AMOUNT OF EUR 30 MILLION (US$ 34.6 MILLION EQUIVALENT) TO THE REPUBLIC OF ALBANIA FOR AN Additional Financing for the Project for Integrated Urban and Tourism Development December 17, 2021 Urban, Resilience And Land Global Practice Europe And Central Asia 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 September 30, 2021) Currency Unit = EUR EUR 1 = US$ 1.15333 FISCAL YEAR July 1 – June 30 Regional Vice President: Anna M. Bjerde Country Director: Linda Van Gelder Regional Director: Steven N. Schonberger Practice Manager: Christoph Pusch Task Team Leader(s): Tuo Shi, Anita Ellmauer-Klambauer ABBREVIATIONS AND ACRONYMS ADF Albanian Development Fund AF Additional Financing CE Citizen Engagement CPF Country Partnership Framework DA Designated Account DFIL Disbursement and Financial Information Letter DRM Disaster Risk Management ECA Europe and Central Asia EIB European Investment Bank ESMF Environmental and Social Management Framework EU European Union EUR Euro FM Financial Management FY Fiscal Year GBV Gender Based Violence GDP Gross Domestic Product GHG Greenhouse Gas GoA Government of Albania GRS Grievance Redress Service IFI International Financial Institution IFR Interim Financial Report INSTAT Institute of Statistics IPF Investment Project Financing IR Intermediate Results IsDB Islamic Development Bank ISR Implementation Status Report IUDC Integrated Urban Design Consultancy KfW Kreditanstalt fuer Wiederaufbau MoC Ministry of Culture MoFE Ministry of Finance and Economy MoIE Ministry of Infrastructure and Energy MoT Ministry of Tourism PAD Project Appraisal Document PDO Project Development Objective PIU Project Implementing Unit PIUTD Project for Integrated Urban and Tourism Development PP Project Paper PPE Personal Protective Equipment RF Results Framework RPF Resettlement Policy Framework PPSD Project Procurement Strategy for Development PSC Project Steering Committee SCD Systematic Country Diagnostic SLRP Secondary and Local Roads Project SORT Systematic Operations Risk-rating Tool STEP Systematic Tracking of Exchanges in Procurement UNESCO United Nations Educational, Scientific and Cultural Organization UNWTO United Nations World Tourism Organization UPP Urban Partnership Program USD US Dollar WB World Bank WBG World Bank Group WDI World Development Indicators TABLE OF CONTENTS I. BACKGROUND AND RATIONALE FOR ADDITIONAL FINANCING ........................................ 6 II. DESCRIPTION OF ADDITIONAL FINANCING .................................................................... 16 III. KEY RISKS ..................................................................................................................... 20 IV. APPRAISAL SUMMARY .................................................................................................. 21 V. WORLD BANK GRIEVANCE REDRESS .............................................................................. 34 VI. SUMMARY TABLE OF CHANGES .................................................................................... 35 VII. DETAILED CHANGE(S).................................................................................................... 35 VIII. RESULTS FRAMEWORK AND MONITORING ................................................................... 38 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) BASIC INFORMATION – PARENT (Project for Integrated Urban and Tourism Development (PIUTD) - P155875) Country Product Line Team Leader(s) Albania IBRD/IDA Tuo Shi Project ID Financing Instrument Resp CC Req CC Practice Area (Lead) P155875 Investment Project SCAUR (9350) ECCWB (7001) Urban, Resilience and Land Financing Implementing Agency: Albanian Development Fund ADD FIN TBL1 Is this a regionally tagged pro- ject? No Bank/IFC Collaboration No Expected Guar- Original Environmental As- Approval Date Closing Date antee Expira- Current EA Category sessment Category tion Date 15-Nov-2016 31-Jul-2022 Partial Assessment (B) Partial Assessment (B) Financing & Implementation Modalities Parent [ ] Multiphase Programmatic Approach [MPA] [ ] Contingent Emergency Response Component (CERC) [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Performance-Based Conditions (PBCs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a Non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made disaster [ ] Alternate Procurement Arrangements (APA) [ ] Hands-on Expanded Implementation Support (HEIS) Page 1 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Development Objective(s) The PDO of the proposed project is to improve urban infrastructure, enhance tourism assets, and strengthen institutional capacity to support tourism-related local economic development in selected areas in the south of Albania. Ratings (from Parent ISR) RAT ING_DRAFT_NO Implementation Latest ISR 12-Aug-2019 13-Nov-2019 07-May-2020 09-Nov-2020 12-May-2021 18-Nov-2021 Progress towards achievement of S S S S S S PDO Overall Implementation MS MS MS MS MS MS Progress (IP) Overall Safeguards MU MU MS MS MS MS Rating Overall Risk S S M M M M Financial Management S S S S S S Project Management S S S S S S Procurement S S S S MS MS Monitoring and Evaluation S S S S S S BASIC INFORMATION – ADDITIONAL FINANCING (Project for Integrated Urban and Tourism Development Additional Financing - P171438) ADDFIN_TABLE Urgent Need or Capacity Project ID Project Name Additional Financing Type Constraints P171438 Project for Integrated Scale Up No Page 2 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Urban and Tourism Development Additional Financing Financing instrument Product line Approval Date Investment Project IBRD/IDA 19-Jan-2022 Financing Projected Date of Full Bank/IFC Collaboration Joint Level Disbursement 30-Nov-2025 Yes Joint Project - involving co financing with IFC (loan, equity, budget, other) or staffing Is this a regionally tagged project? No Financing & Implementation Modalities Child [ ] Series of Projects (SOP) [ ] Fragile State(s) [ ] Performance-Based Conditions (PBCs) [ ] Small State(s) [ ] Financial Intermediaries (FI) [ ] Fragile within a Non-fragile Country [ ] Project-Based Guarantee [ ] Conflict [ ] Deferred Drawdown [ ] Responding to Natural or Man-made disaster [ ] Alternate Procurement Arrangements (APA) [ ] Hands-on Expanded Implementation Support (HEIS) [ ] Contingent Emergency Response Component (CERC) Disbursement Summary (from Parent ISR) Net Source of Funds Total Disbursed Remaining Balance Disbursed Commitments IBRD 71.00 23.44 48.35 33 % IDA % Grants % PROJECT FINANCING DATA – ADDITIONAL FINANCING (Project for Integrated Urban and Tourism Development Additional Financing - P171438) Page 3 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) PROJECT FINANCING DATA (US$, Millions) SUMMARY -NewFi n1 SUMMARY (Total Financing) Proposed Additional Total Proposed Financ- Current Financing Financing ing Total Project Cost 71.00 34.60 105.60 Total Financing 71.00 34.60 105.60 of which IBRD/IDA 71.00 34.60 105.60 Financing Gap 0.00 0.00 0.00 DETAILS - Additional Financing NewFinEnh1 World Bank Group Financing International Bank for Reconstruction and Development (IBRD) 34.60 COMPLIANCE Policy Does the project depart from the CPF in content or in other significant respects? [ ] Yes [ ✔ ] No Does the project require any other Policy waiver(s)? [ ] Yes [ ✔ ] No INSTITUTIONAL DATA Practice Area (Lead) Urban, Resilience and Land Contributing Practice Areas Page 4 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Climate Change and Disaster Screening This operation has been screened for short and long-term climate change and disaster risks PROJECT TEAM Bank Staff Name Role Specialization Unit Team Leader (ADM Tuo Shi Urban Economist SCAUR Responsible) Anita Ellmauer-Klambauer Team Leader Urban Specialist SCAUR Procurement Specialist (ADM Orjana Ibrahimi Procurement Specialist EECRU Responsible) Arben Maho Procurement Specialist Procurement Specialist EECRU Financial Management Jonida Myftiu Financial Management EECG2 Specialist (ADM Responsible) Environmental Specialist (ADM Anne Olufunke Asaolu Environmental Specialist SCAEN Responsible) Social Specialist (ADM Roxanne Hakim SCASO Responsible) Bekim Imeri Social Specialist SCASO Dilip Kumar Prusty Chinari Team Member WFA Finance Officer WFACS Drite Dade Team Member Environmental Specialist SCAEN Felix Alberto Quintero Counsel Country Lawyer LEGLE Vollmer Lisa Fonick Haworth Team Member Team Assistant SCAUR Odeta Bulo Team Member Team Assistant ECCAL Senior Tourism/Private Sector Shaun Mann Team Member ETIMT Specialist Tatyana Shadrunova Team Member Senior Operations Officer SCAUR Extended Team Name Title Organization Location Page 5 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) I. BACKGROUND AND RATIONALE FOR ADDITIONAL FINANCING A. Introduction 1. This Project Paper (PP) seeks the approval of the World Bank Board of Executive Directors for an Addi- tional Financing (AF) loan of EUR 30 million (US$ 34.6 million equivalent) from the International Bank for Reconstruction and Development (the Bank) for the Project for Integrated Urban and Tourism De- velopment (PIUTD). The proposed AF responds to the official request received from the Ministry of Fi- nance and Economy (MoFE) of Albania on May 14, 2020. The funds will be used to scale-up the current PIUTD activities on integrated urban and tourism development in new locations in the south of Albania and support resilient recovery in the tourism sector from the COVID-19 and adaption to changes in the scope and scale of tourism demand due to COVID-19. 2. The PP also provides a rationale for the restructuring of the parent Project, including modification of the Results Framework (RF) to capture the expanded Project scope and activities supported by the proposed AF, and extension of the original loan closing date to align it with the AF closing date. The PIUTD development objective (PDO) is to improve urban infrastructure, enhance tourism assets and strengthen institutional capacity to support tourism-related local economic development in selected ar- eas in the south of Albania. Since the scope of the AF will fall within this original PDO, the PDO will remain unchanged. At the same time, the RF will be modified to: (i) revise the end target values of existing indicators to capture the expected contribution of additional activities financed by the AF and/or the negative impacts of COVID-19 on the tourism sector; (ii) revise some indicators to improve their attrib- ution to the Project; and (iii) include new indicators to enhance monitoring of the project impacts on employment generation against the COVID-19 crisis, climate change mitigation and citizen engagement (CE) process. 3. The PIUTD loan closing date will be extended from July 31, 2022 to July 31, 2025 to be aligned with the closing date of the AF and secure sufficient time to complete all planned investments, including addi- tional activities supported by the AF, and provide the Bank and the Borrower reassurance that the Project fully achieves its PDO. This extension is also deemed necessary due to the unforeseen impacts of the COVID-19 pandemic that has already stalled tourism activity in the project area for several months and delayed the implementation of several large procurement activities dependent on international exper- tise. 4. The AF will contribute to resilient, inclusive and sustainable recovery in Albania as outlined in the World Bank Group (WBG) COVID-19 Response Approach Paper. 1 The activities under the AF fall under the Resilient Recovery Stage, as outlined in the Approach Paper, and will contribute particularly to Pillar 3 Ensuring Sustainable Business Growth & Job Creation as well as Pillar 4 Strengthening Policies, Institu- tions and Investments for Rebuilding Better. The original Project and the AF comprise urban upgrading and rehabilitation works as well as investments in underground infrastructure, which are labor-intensive works, contributing to the generation of employment and income for the local population and, thus, 1 World Bank Group. World Bank Group COVID-19 Response Approach Paper. June 2020. Page 6 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) recovery of the local economy. 2 The Project also contributes to sustainable business growth and job cre- ation through the market and tourism development activities. B. Country and Sector Context 5. Restoring strong growth is a priority of the Government of Albania (GoA) to reverse the poverty trends and to boost shared prosperity. Albania emerged from the collapse of communism in the early 1990s as one of the poorest countries in Europe. The country then experienced rapid growth of nearly six percent per year rising to the ranks of a middle-income country by 2008. The rapid pace of growth helped the country narrow the per capita income gap with the rest of Europe, from 18 percent of average European Union (EU) incomes in 1998 to 30 percent by 2012, and fueled aspirations to join the EU. However, the global and Eurozone crises in 2008 brought Albania's growth to a near standstill by 2012; GDP growth fell to an average of 2.4 percent per year, only gradually recovering in the period 2014-18. Unemployment and as well as poverty levels also rose in the aftermath of the crises. Poverty (as measured at US$5.5 per day in PPP) increased to 39.3 percent by 2012. By 2017, close to four in ten Albanians still lived on less than US$5.5 per day and the poverty rate was similar to the 2008 level. 3 As outlined in the 2015 System- atic Country Diagnostic (SCD) as well as the 2019 Update of the SCD, economic growth in Albania has been strongly associated with both poverty reduction and increased welfare of the bottom 40 percent of the population. An accelerated and inclusive growth model requires deep structural reforms to release binding constraints to growth, in combination with territorial targeting to ensure that all the areas of the country can take advantage of their endowments. 6. Between 2017-2019 poverty had modestly declined, however, the 2019 earthquake and the Covid-19 pandemic are expected to reverse this trend and significantly increase poverty in 2020. Simulations based on scenario analysis assuming two quarters of mobility restrictions result in a sharp increase in poverty, even after accounting for compensation measures such as increased social assistance and wage subsidies. Poverty is estimated to increase by about 5 percentage points, from a baseline of around 35 percent. The resulting poverty rate is comparable to the level in 2005. 7. The 2019 Update of the SCD also highlights the importance of tourism for sustainable and spatially inclusive growth in Albania. A recent World Bank study on the Blue Economy underlines the role of sustainable tourism as one of the key opportunities to achieve national development goals. 4 The study recommends that an integrated and balanced development approach for coastal and marine resources should be followed to drive economic growth and ensure ecological and social sustainability. Provision of infrastructure to coastal areas and branding of the Albanian coast as an authentic, diverse, and clean destination can increase the value of marine tourism and offer a variety of water-based tourism and recreational sector activities. The study analyzed three sectors: fisheries and aquaculture, nautical tour- ism and marine plastic. As regards marine plastic, Albania lacks an effective solid waste management system. Waste infrastructure services are provided for 31.7% of the population of the country. Municipal solid waste, including plastic packaging/waste is disposed of in the landfills or old dumpsites, and often fly tipped in river gorges or lakes. Plastic litter could affect the performance of marine based sectors such as tourism, fisheries, and shipping and result in a loss of revenue from these valuable resources. 2 World Bank Group. GPURL Guidance Note. Labor-Intensive Public Works Response to COVID-19. May 2020. 3 World Bank Group. 2019. Albania Systematic Country Diagnostic – 2019 Update. 4 World Bank Group, 2019. Realizing the Blue Potential of Albania report. Page 7 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) 8. Albania is exposed to various types of natural hazards, including earthquakes, floods, storms, droughts and rising sea levels. Observed and anticipated climate change impacts, such as more intense precipita- tion and rising sea levels, are expected to lead to increasing risks to natural disasters, including more frequent and intense flooding in low-lying areas of river deltas and coastal cities and other extreme weather events. This highlights the need for Albania to take proactive action to minimize the risk of ex- posure to such events through various adaptation mechanisms. 5 This AF will support implementation of Albania’s climate change adaptation and mitigation plans by strengthening urban climate resilience and improving energy efficiency, and institutional capacity building at the national and local levels. 9. As part of its territorial targeting approach, the GoA is moving toward establishing a regional develop- ment platform and has identified the south of the country as a priority for regional development, given its tourism potential based on unique natural resources and cultural heritage assets. The GoA is imple- menting regional development reforms aimed at achieving greater territorial cohesion by reducing re- gional disparities in access to services and supporting local economic development building upon existing local and regional assets, and is also expected to contribute, in the medium term, to EU accession and the absorption of regional development funds. As part of these reforms, the south of Albania 6 is consid- ered a priority given its unique natural resources and cultural heritage assets and high potential to further develop tourism as a driver of local, regional, and national economic growth. Tourism is one of the key drivers for economic growth and job creation in Albania. The tourism industry has emerged as an im- portant contributor to the economy, contributing directly to an estimated 2.8 percent of gross domestic product (GDP) in 2019. This contribution is higher taking into account the indirect effects on tourist spending on other economic activities, which amounted to 21.2% in 2019. 7 Its contribution to employ- ment is significant, directly supporting 58,000 jobs in 2017, and is estimated to grow to 220,000 jobs by 2025. 8 As such, the Ionian coastline located in the south of Albania and the southern hinterland offer an appealing tourism value proposition in terms of pristine coastlines, mountains, as well as the country’s three UNESCO World Heritage Sites: Butrint, an ancient Greek and Roman city, located near Ksamil; Be- rat; and Gjirokastra, a well-preserved Ottoman medieval city. The area also has a vast number of cultural monuments of national importance (for example, Porto Palermo and Orik archeological park), national parks with unique natural and cultural features (for example, Benja thermal waters and Zvernec Island), and an emerging tourism gateway, in the city of Saranda, with easy air access through Corfu as well as a new cruise ship terminal. 5 Albania has developed a National Adaptation Plan to prepare for the impacts of climate change and has laid out several key sectors for adaptation action via the First and Second National Communications to the United Nations Framework Convention on Climate Change. These sectors include coastal zones, agriculture/forestry, water, tour- ism and health. Furthermore, Albania is a part of European Union legislation, including legislation on climate change and is a signatory to the Energy Community Treaty. 6 The south of Albania, as referred to in this project, does not correspond to a specific administrative region. It is a geographic area that has been recognized for its tourism potential and includes several of Albania’s most attractive and diverse tourism assets. The south of Albania comprises the area between Fier-Vlora and Saranda, and covers both the coast, including Saranda, Ksamil and Orikum, and the hinterland, including Berat, Permet, and Gjirokastra. 7 World Travel and Tourism Council. Economic Report Albania 2019. 8 INSTAT. Albania. Tourism in figures. 2018, 2019. Page 8 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) 10. However, a number of obstacles prevent the south of Albania from realizing its full economic and tour- ism potential. First, basic urban infrastructure is inadequate to meet residents’ needs and growing tour- ism demand. Existing assets are deteriorating due to a lack of maintenance, and municipalities lack the capacity to deliver supporting services in a sustainable way. Second, despite the rich asset base available, tourism activities are concentrated over a short period of time, i.e. the summer season, not sufficiently diversified, and dominated by high-volume and low value local and regional markets. Third, tourism ac- tivities, both at the national and local level, and, on the supply and demand side, are not supported or managed in a coordinated way. 11. The ongoing PIUTD takes an approach of integrated urban and tourism development with the focus on (i) improving urban infrastructure to enhance the attractiveness and livability of four urban centers in the south of Albania, namely Berat, Gjirokastra, Saranda and Permet; (ii) enhancing the touristic appeal and sustainable management of selected cultural heritage assets in the South of Albania; (iii) strength- ening municipal capacity to deliver services and tourism destination management, in cooperation with the national Government. The AF will adopt this approach in new locations in the south of Albania, while also strengthening the ability of targeted municipalities to respond to COVID-19 related tourist product and market shifts. 12. The two new locations which are added through the AF are Orikum, under the municipality of Vlore, and Ksamil, under the municipality of Saranda, both located on the Albanian riviera. Orikum is selected because of its suitability for outdoor recreation activities and its proximity to a large domestic market in Tirana. Similarly, Ksamil has potential to serve the domestic market in Saranda. Interventions in these two towns are not only important for the development of the specific towns but will also support the touristic and economic development of the south of Albania as a whole. Albania’s response to the COVID-19 crisis 13. In March 2020, Albania was forced to take unprecedented public health measures to slow the spread of the global COVID-19 pandemic. This was at a time when Albanians were starting the reconstruction process from a 6.3-magnitude earthquake that hit in November 2019, killing 51 people, displacing 17,000 and causing damages and losses estimated at 7.5 percent of GDP. Due to the earthquake, year-on-year quarterly GDP contracted by 0.2 percent in Q4 2019. As COVID spread through Europe, Albania ordered the temporary lockdown of key economic sectors, limited the movement of people, and put in place wide-ranging domestic and international travel limitations. The health crisis followed by the pandemic related economic closures plunged Albania into a severe recession, leading to a downward revision of the World Bank’s GDP forecast for Albania by more than 11 percentage points for 2020. The crisis is affecting the country through domestic and external channels. On the domestic front, social distancing measures caused a sharp deceleration in economic activity, particularly in the hospitality, construction, transportation, and retail sectors. Key services such as cross-border travel and tourism are subdued. Tourism receipts alone equate to about 15 percent of GDP, but with the related indirect effects on con- struction, employment, and other industries, tourism is responsible for about 26 percent to GDP. Given unprecedented disruptions and uncertainty, non-essential spending by households and businesses has been delayed. Export orders have sharply reduced in the face of severe economic dislocations in key trading partners, including Italy. Albania’s exposure to Italy, one of the most affected countries in the EU, is substantial: Italy receives 47 percent of exports (mainly manufactures) and is the source of 9.7 percent Page 9 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) of FDI. 14. In response to the earthquake and to support the economy during the COVID-19 crisis, the Government has rolled out significant new fiscal support measures. For earthquake reconstruction, Albania allocated 2.2 percent of GDP. In addition, it raised 8.6 percent of GDP in grants and potential loans at a February 2020 donor conference. To respond to the COVID-19 crisis, Albania rapidly put forward a fiscal package worth 2.4 percent of GDP. This includes increased budget for the public health response and immediate humanitarian relief. In the period April to June, a grant program provided minimum wage payments for the workers in small firms forced to close during the pandemic. Credit guarantee windows incentivize banks to make business loans. Various corporate income tax payments have been rescheduled. The social safety net has been strengthened by doubling unemployment benefits and social assistance payments. In a sign of solidarity, key government institutions temporarily cut salaries for high-level officials. 15. Albania is mobilizing donor and private sector financing to meet financing needs. In 2020, gross financ- ing needs are estimated at US$4.3 billion (28.8 percent of GDP). International development partners, including a Rapid Finance Instrument (US$190 million) support by the IMF, EU budget support (EUR 180 million) under the MFA, and budget support by the French Development Agency (EUR50 million), will be key sources of financing. Coverage of the estimated financing needs also includes mobilization of signifi- cant financing from the private sector. The Government successfully issued a previously planned EUR650 million Eurobond (7-year maturity, fixed rate, yield 3.625 percent) in June 2020. C. Relevance to higher-level objectives Relationship to CPF 16. The current World Bank Group Country Partnership Framework (FY15-20) was extended by one year through the Performance and Learning Review. The CPF focuses on: (i) restoring macroeconomic bal- ances, (ii) creating conditions for accelerated private sector growth, and (iii) strengthening public sector management and service delivery. The SCD Update was completed in May 2020 outlining three strategic objectives: (i) integrating into the global economy, (ii) making local government more effective, and (iii) enhancing economic and social inclusion. It also recognized critical pre-conditions: (i) strengthening rules-based government, (ii) achieving a stable macroeconomic environment, and (iii) strengthening pro- tection of natural resources. IFC is currently finalizing its Country Private Sector Diagnostic (CPSD) which identifies key policy and regulatory reforms needed to unblock private investments in three key sectors of the economy: agribusiness, tourism and manufacturing. The CPSD also evaluates the COVID-19 effects on the Albanian private sector. 17. The proposed AF is consistent with the WBG CPF for Albania (FY15-20). The AF supports three objectives of the CPF, namely Objective 2B, which focuses on sustainable tourism development, Objective 2A, which aims to contribute to an improved business environment and Objective 3A which supports an increase in the efficiency of public service delivery. The proposed AF is also in line with the National Strategy for Development and Integration (2014-2020) of the Republic of Albania which envisages strong, sustained and environmentally friendly economic growth which increases well-being among the Albanian citizens. Page 10 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Relationship to WBG’s COVID-19 response 18. The Bank’s response to the COVID-19 pandemic supports the GoA’s response (as noted in the Country Context section). The CPF proposed an IBRD lending program of up to US$1.2 billion (of which approxi- mately US$870 million has been committed through June 2020). Preparation of the new CPF had com- menced but was delayed due to the November 2019 earthquake and subsequently the COVID-19 pan- demic. However, WBG support going forward is focused on helping Albania manage the impacts of both crises. The support is aligned with the CPF, SCD update, and the WBG Approach Paper “Saving Lives, Scaling-up Impact and Getting Back on Track”. 19. The proposed Additional Financing to the PIUTD will support Albania’s national and local economies in the short-term by providing jobs for the domestic contractors and, thus, assisting the Government in accelerating its efforts to facilitate the country’s recovery from the COVID-19 crisis, while also sup- porting longer-term response and efforts to rebuilding better. The AF will contribute to saving liveli- hoods, preserving jobs in construction and hospitality sectors, and ensuring more sustainable business growth and job creation in Albania. The scope of the AF has been adjusted to support resilient recovery in the tourism sector, including supporting municipalities and businesses to deal with changes in the scope and scale of tourism demand due to COVID-19 and develop more products oriented to domestic and regional markets. 20. For both the response to the earthquake and the response to COVID, development partners have col- laborated closely. For the earthquake, a joint Government-EU-UN-WB Post Disaster Needs Assessment was presented to a donor’s conference coordinated by the Government and the EU, while on COVID, the Government is taking the lead in coordinating development partner support. For example, as critical so- cial assistance needs were adequately covered by the GoA, EU and other donors, WBG support was not needed. There is close coordination with the IMF and the EU on budget support operations and overall policy dialogue. D. Original PDOs and Progress to Date 21. The PDOs of the parent Project are to: (a) improve urban infrastructure; (b) enhance tourism assets; and (c) strengthen institutional capacity to support tourism-related local economic development in selected areas in the south of Albania. 22. The original Components of the Project are the following: • Component 1(Urban Upgrading and Infrastructure Improvement – EUR 44.3 million) finances the upgrading of infrastructure in selected municipalities (Berat, Permet, Saranda and Gjirokastra) in- cluding preparation of feasibility studies and designs, restoration of selected heritage buildings and upgrading public spaces, street networks and associated infrastructure. All studies and infrastructure rehabilitation works will consider location-specific climate change risks and address them through a targeted project design to strengthen climate resilience and contribute to adaptation efforts in the sector. Also, the upgrading of infrastructure will significantly improve energy efficiency in the project municipalities and contribute to mitigation. All project-supported Page 11 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) interventions will be disclosed and discussed in public to ensure that inputs of beneficiaries and other stakeholders are taken into account in site selection and design, and the citizens will be in- formed of the outcomes of the consultation process after each stakeholder consultation workshop. • Component 2 (Touristic Sites Upgrading – EUR 8.4 million) finances investments aimed at improv- ing selected touristic sites along the south of Albania touristic corridor by restoring selected heritage sites and cultural assets and upgrading the corresponding tourist infrastructure, and includes prep- aration of the respective feasibility studies, management plans and engineering designs. All studies and site upgrading works will also consider location-specific climate change risks and address them through project design to strengthen climate resilience and contribute to adaptation efforts in the sector. Also, the upgrading of infrastructure will significantly improve energy efficiency in the project municipalities and contribute to mitigation. All project-supported interventions will be disclosed and discussed in public to ensure that inputs of beneficiaries and other stakeholders are taken into account in site selection and design, and the citizens will be informed of the outcomes of the consultation process after each stakeholder consultation workshop. • Component 3 (Tourism Market and Product Development – EUR 7.7 million) is aimed at strength- ening the capacity of municipalities to deliver municipal services through provision of asset man- agement systems, geographic information systems and solid waste collection equipment; estab- lishment of site management capacity to enhance the operation of rehabilitated assets as well as supporting the project municipalities in the development of new tourism products, adding value to existing products, strengthening tourism value chains and aggregating and connecting products to markets. Capacity building will include trainings on climate change (mitigation and adaptation) relevant for tourism in the targeted areas. Waste management measures will contribute to the reduction of GHG emissions. Overall, the Project will contribute substantially to the further development of sus- tainable, environmentally friendly tourism in the south of Albania through its climate-friendly in- vestments in infrastructure and touristic sites upgrading as well as targeted capacity-building for the selected project municipalities on sustainable destination management. All project-supported activities will be disclosed and discussed in public to ensure that inputs of beneficiaries and other stakeholders are taken into account in the design, and the citizens will be informed of the outcomes of the consultation process after each stakeholder consultation workshop. Capacity building activi- ties will also target tourism SMEs (hotels, tour operators, guides, etc.) – including women- led/owned SMEs – contributing to local economic development. • Component 4 (Implementation Support – EUR 3.2 million) provides support to carry out Project implementation, including Project M&E and financing of Incremental Operating Costs. Progress towards the PDO achievement is rated Satisfactory and Overall Implementation Progress is rated Moderately Satisfactory in the latest Implementation Status Reports. The Project activities under Component 1 have been progressing satisfactorily. Some of the civil works contracts (such as the Berat castle pedestrian-access cobblestone road, Berat Castle vehicle access road, Saranda promenade, Page 12 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Saranda staircases, Permet streetlighting, Gjirokastra Bazaar cobblestone rehabilitation works) have al- ready been completed. The civil works of several large contracts – such as integrated urban upgrading in Berat and Permet, system of museums in Gjirokastra, and rehabilitation of Gjirokastra Castle – are ongo- ing but were previously stalled due to travel restriction imposed during the COVID-19 related lockdown. Design consultancies for integrated urban upgrading in Saranda and Gjirokastra are ongoing. Compo- nents 2 and 3 have overcome some delays experienced at the initial Project stage with implementation progress picking up lately. Under Component 2, of the seven touristic sites selected, two (Benja and Zver- nec) have completed development of the site management plan and procurement for civil works of in- frastructure upgrading; two (Viewpoints and Gjirokastra Castle) have the design consultancy ongoing; and the other three (Kanina Castle, Borsh Castle and Spille Cave) have launched the procurement for design consultancy. Under Component 3, the Market Research & Development Strategy has been com- pleted; consultancies for Market Development and Tourism Product Development are ongoing; procure- ment of the consultancies for Tourism Information Management and Statistics System and Destination Management Partnership have been completed. 23. Implementation and disbursement progress are expected to pick up in FY22. So far, the Project has disbursed EUR 20.3 million (US$23.4 million equivalent) which is 33 percent of the total loan amount. It is expected that EUR 20.8 million will be disbursed in FY22. Of the total loan amount of EUR 63.8 million, 12 million of contracts has been completed; 22 million has been procured and under implementation; and the remaining 30 million is expected to be procured in FY22. 24. The Project implementation had a slow start-up for a variety of reasons, for which the Bank team has undertaken proactive mitigation measures to avoid any further implementation delays, as specified below: a) Project Design. The Project follows a framework approach. Thus, the full investment scope was not known before the Project start but determined through a series of consultancies to identify the spe- cific investments and preparation of design documentation. To date, most of the designs are com- pleted, and the major civil works are underway. The consulting services for the new investments under the AF will build on previous works under the parent Project. That will allow saving time and accelerate the AF activities implementation. b) Safeguards issues. Implementations delays have also been caused by two major safeguards related issues, both of which have been resolved. The first is the long-standing social safeguards noncompli- ance caused by demolition at the Blue Eye tourist site, which has been resolved following the gov- ernment’s commitment to mitigation measures satisfactory to the Bank, as documented in a letter from the government to the Bank dated April 10, 2020 and in an annex to the Resettlement Policy Framework (RPF) updated for the AF. The second is the discrepancies in principles of compensation for expropriation between the Bank’s safeguards policy and the relevant Albanian law, which caused significant delays to a major civil works under the Project, i.e. Berat Castle Vehicle Road. The Bank team worked with MoIE and ADF to find a solution. The Government passed in the spring of 2020 an Amendment to the National Law authorizing that international standards on the compensation for expropriation shall prevail over the national ones when executing the World Bank financed projects and any other investment programs funded by International Financial Institutions/Donors. The amendment resolved a major issue that would have caused serious delays for any subprojects that Page 13 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) involve the expropriation or resettlement. c) PIU capacity. The slow start-up of the implementation is also related to the limited implementation capacity of the PIU, i.e. ADF, which had been exacerbated by changes of the agency’s Executive Di- rector, Deputy Executive Director and Project Manager. In particular, significant delays had been ex- perienced due to ADF and their consultants’ limited capacity in the preparation of Environmental and Social (E&S) assessments and tools in accordance with the Bank policy. To address this issue, the Bank team provided a joint training to ADF and consultants on the E&S safeguards, which has already resulted in significant improvement in the quality of safeguards documents submitted; based on the Bank’s recommendation, specialized and dedicated E&S consultants will be contracted by ADF to undertake the E&S tasks in the course of preparation of the design for the remaining sub-projects, including those to be financed by the AF; the Bank team also provided a simplified E&S Screening Template for ADF to speed up the sub-project Environmental and Social assessment. d) Earthquake and COVID-19 crisis. The ability to sustain the implementation progress was furthermore put at risk by the negative impact of the November 2019 earthquake that halted some activities, and the COVID-19 pandemic lockdown measures introduced in the country and region-wide in spring 2020 and subsequent partial stop or delays in execution of the ongoing construction works 9 and some of the ongoing consultancies that involved international expertise. To date, the implementa- tion of the ongoing construction contracts has resumed, and some major new works contracts are already underway or expected to start soon. Consequently, the Project implementation is expected to accelerate with disbursement picked up within FY22. 25. Audit. There are no outstanding FM issues and no overdue audits for the project. E. Rationale for Additional Financing and Restructuring 26. In response to the official request received from the Ministry of Finance and Economy (MoFE) of Alba- nia on May 14, 2020, and based on the technical proposal received from the ADF on July 21, 2020 the AF will be used to support scale-up of investments in two new locations in the south of Albania on urban upgrading and infrastructure improvement as well as strengthening the tourism market and product development in light of changes in scope and scale of demand due to the COVID-19 crisis. The scale-up investments will be focused on Ksamil and Orikum, both of which are closely connected to the municipalities which are already participating in the parent Project and their tourism sites. The invest- ments in Ksamil and Orikum would be within the scope of Component 1 and Component 3 under the parent Project, including a combination of upgrading of vehicular, pedestrian and multimodal accesses to the city and tourism attractions, strengthening of pedestrian connections and trails systems, inte- grated street upgrading, upgrading of recreational areas/parks and adaptive reuse of selected structures as well as tourism market and product development. The COVID-19 crisis has severely disrupted conven- tional demand and supply patterns and there is a need for municipalities to adapt to the new normal that may persist for several years. 9 The work schedules had to be revised to ensure staff safety and health at the time of the COVID-19 pandemic. All the contracts must be conducted by smaller teams with a limited number of workers within reduced working hours to comply with sanitary and epidemiological requirements. Page 14 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) 27. The proposed investments will also contribute to climate change adaptation, as they will make the pro- ject municipalities more resilient to climate-related extreme weather events and floods, which is partic- ularly relevant for coastal cities, such as Ksamil and Orikum. Furthermore, investments in the installation of energy-efficient streetlighting in city centers will contribute to climate change mitigation. The pro- posed AF will also potentially support additional investments on urban upgrading and infrastructure im- provement in the present Project municipalities, i.e. Berat, Permet, Saranda and Gjirokastra, to meet the demand for additional investments under Component 1 which will contribute to the development objec- tive of the Project but cannot be covered under the original loan. Component 2 will not receive any ad- ditional funds from the AF loan as there is still enough funding available under the parent project. Tour- istic sites upgraded under PIUTD Component 2 are located along the touristic corridor in the South of Albania and also comprise sites close to the new project areas Ksamil and Orikum. 28. The parent Project will be restructured to (i) modify the Results Framework (RF) to capture the ex- panded Project scope and new activities supported by the AF, as well as revise some existing indicators to better track the project implementation progress and (ii) extend the closing date to be aligned with the closing date of the AF and ensure sufficient time for successful completion of the additional activ- ities and achievement of the PDO. The original PDO is to improve urban infrastructure, enhance tourism assets and strengthen institutional capacity to support tourism-related local economic development in selected areas in the south of Albania. Since the scope of the AF will fall within this original PDO and thus, the PDO will remain unchanged. At the same time, the RF will be modified to: (i) revise the end target values of existing indicators to capture the expected contribution of additional activities financed by the AF and/or the negative impacts of COVID-19 on the tourism sector; (ii) revise some indicators to improve their attribution to the Project; and (iii) include new indicators to enhance monitoring of the project impacts on employment generation against the COVID-19 crisis, climate change mitigation and citizen engagement (CE) process. 29. The AF has a high degree of readiness for implementation. The consulting services for the new invest- ments under the AF will build on previous works under the parent Project which will accelerate the AF activities implementation. The concept for urban upgrading in Ksamil has already been well developed by a participatory urban planning initiative funded under the Urban Partnership Program (UPP), with specific interventions/subprojects identified and a methodology for prioritization developed to formu- late a full investment program, as specified in the Appraisal Summary section. This will enable the Inte- grated Urban Design Consultancy (IUDC) contract for the AF activities to start directly from the design phase. In addition, the ADF has already mobilized a consultant for the identification of the investment program in Orikum, which will also allow starting the IUDC consultancy for Orikum from the design phase. The ADF has already prepared the Terms of Reference for the IUDC consultancy in Orikum and Ksamil. 30. The ADF’s implementation capacity and experience have been much strengthened through the ongo- ing implementation of the parent Project. The contemporary implementation of tasks financed under the original PIUTD loan and the AF will allow for making efficient use of the strengthened implementation expertise of the ADF project team and benefiting from the economy of scale concerning national and local capacity building and destination management activities in the south of Albania. The original PIUTD loan closing date is proposed to be extended to July 31, 2025 to be aligned with the AF loan closing date to allow sufficient time to complete both the originally planned and new activities. The ADF has prepared a detailed implementation plan that specifies the timeline and key milestones for completing each of the Page 15 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) PIUTD supported activities within the new Project implementation timeframe. II. DESCRIPTION OF ADDITIONAL FINANCING A. Key Changes under the Additional Financing 31. The proposed AF, as explained in more detail below, relates to: (i) scaling up activities under Compo- nents 1 and 3 to include new locations to be supported by the Project; (ii) scaling up activities under Component 1 in the original project municipalities; (iii) modifying the Results Framework to capture the AF supported activities and improve overall monitoring of the project implementation; (iv) extend- ing the original PIUTD loan closing date to be aligned with the AF closing date and ensure successful implementation of the AF supported activities and full achievement of the PIUTD PDO. B. Changes to Project Components and Activities 32. This AF will be used to support the following activities which respond to the Project development objec- tive and rationale and are presented below by the Project Components: Component 1: Urban Upgrading and Infrastructure Improvement (EUR 27.13 million – equivalent of US$ 31.20 million) 33. The AF will be used to support scale-up of investments on urban upgrading and infrastructure improve- ment into two new locations in the south of Albania, namely Ksamil and Orikum, which are closely con- nected to the municipalities and tourism sites supported by the parent Project. The additional invest- ments in these areas, as specified in the Appraisal Summary section, will fit the current scope of Compo- nent 1 under the parent Project and are similar to the ongoing investments under Component 1 of the Project, including a combination of upgrading of vehicular, pedestrian and multimodal accesses to the city and tourism attractions, strengthening of pedestrian connections and trails systems, integrated street upgrading, upgrading of recreational areas/parks and adaptive reuse of selected structures. 34. Besides investments in these two new locations, the proposed AF will also potentially support additional investments on urban upgrading and infrastructure improvement in the present Project municipalities, i.e. Berat, Permet, Saranda and Gjirokastra, to meet the demand for additional investments under Com- ponent 1 which will contribute to the Project development objective but cannot be covered under the original loan. These additional investments will be identified based on the results of the ongoing inte- grated urban upgrading design consultancies for the four municipalities, the originally envisaged financ- ing envelope for each municipality under the original loan, and available budget from the AF after invest- ments in Ksamil and Orikum. Component 3: Tourism Market and Product Development (EUR 1.30 million – equivalent of US$ 1.50 million) 35. The AF will also be used to support municipalities to adapt to changing market conditions (related to COVID-19) in both the promotion (more targeted) and presentation (considerations of social and physical Page 16 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) distancing, personal protective equipment (PPE) requirements, contactless entry and exit to tourist sites, etc.) of tourism experiences. Ksamil and Orikum, the two new locations, are closely connected to the municipalities supported by the parent project. The additional activities in these municipalities will fit the current scope of Component 3 under the parent Project and are similar to the ongoing investments under Component 3, including development of new tourism products that have appeal to domestic tourism, adding value to existing products, strengthening tourism value chains, adapting to COVID-19 protocols, and targeting and connecting products to markets. Component 4: Implementation support (Euro 1.50 million – equivalent of US$ 1.73 million) 36. The AF will also be used to add funding to the operating costs, given the extension of the loan closing date of the AF. All incremental operating costs in support of the day-to-day management of the project to be carried out by the implementing agency will be financed under the project. These expenses com- prise the salaries (including social charges) of the ADF staff in charge of project implementation as well as customary office expenses, including costs for communications and travel. 37. Project Cost and Financing Plan. Table 1 below shows the original project cost as presented in the Project Appraisal Document (PAD), along with the revised project costs as a result of the proposed AF/Restruc- turing. The allocation of funds and prioritization of investment between the new locations and the four original project participating municipalities have already been agreed with the ADF PIU during the AF preparation, with most of the financing allocated for the two new locations and only a small part reserved for additional investments in the four original project municipalities. Table 1. Project Financing by Component (EURO millions) PAD AF/Restructuring Project Components Project cost IBRD Financing Project Components Project cost IBRD Financing (%) Financing (%) (%) Financing (%) Component 1: Urban upgrading 44.3 100 100 Component 1: Urban upgrad- 71.425 100 100 and infrastructure improvement ing and infrastructure improve- ment Component 2: Touristic sites up- 8.4 100 100 Component 2: Touristic sites 8.4 100 100 grading upgrading Component 3: Tourism market 7.7 100 100 Component 3: Tourism market 9 100 100 and product development and product development Component 4: Implementation 3.2 100 100 Component 4: Implementation 4.7 100 100 support support Front-end fee 0.2 Front-end fee 0.275 Total Costs 63.8 100 100 Total Costs 93.8 100 100 38. Climate change adaptation and mitigation. All the above-mentioned investments in the new Project locations and the present Project municipalities will contribute to climate change adaptation, by strengthening climate resilience of urban infrastructure, particularly in terms of addressing increasing risks of other extreme weather events and more frequent and intense flooding in low-lying areas of river Page 17 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) deltas and coastal cities, such as Saranda, Ksamil and Orikum. Furthermore, the AF will pursue the ap- proach already envisaged under the parent Project with the project’s activities aimed at improving the energy efficiency of urban infrastructure—in particular with regard to the replacement and installment of energy efficient street lighting in city centers—are expected to yield benefits in climate change miti- gation. All studies and rehabilitation works under Components 1 and 2 will consider location-specific climate change risks and address them through project design to strengthen climate resilience, and the infrastructure and cultural heritage upgrades will also improve energy efficiency in the project munici- palities and contribute to mitigation. The capacity building activities under Component 3 will include trainings on climate change (mitigation and adaptation) relevant for tourism in the targeted areas. Waste management measures will contribute to the reduction of GHG emissions. Overall, the Project will con- tribute substantially to the further development of sustainable, environmentally friendly tourism in the south of Albania through its climate-friendly investments in infrastructure and touristic sites upgrading as well as targeted capacity-building for the selected project municipalities on sustainable destination management. A new indicator to track the number of energy efficient street lighting units installed under the Project has been included in the Results Framework. This indicator will allow monitoring of the Pro- ject contribution to climate change mitigation. C. Modifications to the RF 39. The RF will be modified to capture the AF supported activities. The AF also provides an opportunity to improve the present RF of the parent Project. The modifications are summarized in the following table. Table 2. Summary of Changes to RF Indicator Action Rationale for revision PDO Level Results Indicators Increased number of Moved to an intermediate This indicator is changed from a PDO-level to an interme- visitors visiting selected results indicator, revised tar- diate results indicator. There are many factors beyond the touristic sites get values Project that could affect the number of tourists visiting the country and, thus, the number of visitors to the tour- istic sites. In particular, the tourism sector has been hit severely by the COVID-19 crisis, and the number of tour- ists will probably decrease rather than increase in the coming years due to travel limitations/restrictions intro- duced worldwide, among other measures to mitigate the COVID-19 spread. However, the Project will continue monitoring the number of tourists visiting the Project supported sites despite the challenges with attribution and estimation of target values. The indicator will be kept as an intermediate results indicator. The end target val- ues will be revised to capture the expected decrease in the number of visitors due to the COVID-19 pandemic. The formulation of this indicator has been improved by replacing “tourists” with “visitors”, to capture those visi- tors who reside in the project supported areas. Page 18 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Increased number of Newly added indicator This newly proposed indicator replaces the indicator “In- touristic sites with im- creased number of tourists visiting selected touristic proved accessibility sites“ as a PDO-level indicator. This indicator will directly capture the Project activities impact in enhancing tourism assets in the Project supporting area and is considered more attributable to the Project investments on touristic sites upgrading. Here accessibility is defined as initial pre- requisite for all and any visitors, including people with dis- abilities, elderly people, families with children, etc., to reach and appreciate touristic sites. That includes accessi- bility planning and implementation to ensure that the tourism infrastructure is enhanced to meet the needs of both persons with and without disabilities, and people of all ages and physical abilities i.e., when anyone can reach and use infrastructure autonomously, safely, and com- fortably. The improved accessibility also includes a com- prehensive design (integrated planning) that takes from the outset into account the needs of all citizens, including citizens with disabilities, first enables those to participate equally in social activities and secondly increases the level of quality and safety for all. Increased number of Revised target values The baseline survey revealed that tourists’ satisfaction Visitors (in percentage) level was already very high even before the Project imple- satisfied by mentation, thus the original end target value of an in- selected touristic crease in satisfaction of 25% is considered unrealistic. sites The formulation of this indicator is improved by replacing “tourists” with “visitors” which also captures visitors which reside in the project supported areas. New Revised target values The end target values are increased to capture the contri- or rehabilitated urban bution of scale-up activities supported by the AF. public spaces in selected municipalities Number of project Revised target values The end target values are increased to capture results of beneficiaries - the AF supported activities. gender disaggregated Intermediate Level Results Indicators Man-days of temporary Newly added indicator This is a new indicator to monitor how the Project is con- employment generated tributing to the generation of much-needed employment under the Project in times of the COVID-19 crisis and during post-COVID through the civil works economic recovery. Selected municipalities refer to the in selected municipali- towns of Ksamil and Orikum only, which have been added ties. under the AF loan. Energy efficient street- Newly added indicator This is a new climate change indicator to monitor the Pro- lighting units installed ject contribution to climate change mitigation though the in selected municipali- installation of energy efficient streetlighting units (LED ties bulbs, tube lights, other energy efficient lights). Selected Page 19 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) municipalities refer to the towns of Ksamil and Orikum only, which have been added under the AF loan. Urban roads Revised target values The end target values are increased to capture the contri- rehabilitated in bution of scale-up activities supported by the AF. selected municipalities Streets with Revised target values Same as above improved street lighting in selected municipalities New or rehabilitated Revised target values Same as above. pedestrian walkways in selected municipalities Number of municipali- Newly added indicator for This is a new citizen engagement (CE) indicator to en- ties that have engaged citizen engagement hance monitoring of the CE process and allow for CE re- local citizens in an ap- porting on a regular basis. The participatory process, proved participatory which closes the feedback loop, will be approved in the process for the inte- POM and will include the various activities described in grated urban upgrading para 56 below. Number of touristic Revised target values To capture the contribution of scale-up activities sup- products developed ported by the AF. with destination man- agement partnership support (Number) In addition to the above-mentioned changes, the Project implementation period is expected to be increased from 5 years to 8 years as a result of the proposed extension. Accordingly, Cumulative Target Values are added for all PDO and Intermediate Indicators. D. Changes to the Project Closing Date 40. The closing date of the original PIUTD loan is proposed to be extended from July 31, 2022 to July 31, 2025 to be aligned with the AF loan closing date. This extension will provide sufficient time for comple- tion of all activities supported by the AF and enable successful achievement of the PIUTD PDO. The pro- posed extension was calculated by the Borrower taking into account the estimated time-schedule of the additional activities and length of the construction season in the country. III. KEY RISKS 41. The overall risk for the Project for Integrated Urban and Tourism Development, as well as the AF, has been rated as Moderate. 42. The overall risk rating for the Project was downgraded from Substantial to Moderate in the ISR of May Page 20 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) 2020, which was based on downgrading of the risk ratings for: (i) Institutional Capacity for Implementa- tion and Sustainability Risk; (ii) Stakeholders and (iii) Sector Strategies and Policies, from Substantial to Moderate. These changes reflect important improvements in the client’s institutional capacity to imple- ment project activities over the past three years. The team could also see a decrease in the risk associated to stakeholders. The Project design involves frequent coordination with various stakeholders by the PIU, which has worked well over the implementation period. In addition, the sector-level strategies, policies and governance arrangements became better aligned with the country’s development strategy and ob- jectives; and their financial and fiscal sustainability. The overall risk rating has maintained as Moderation since then. 43. The risk rating for Social Safeguards remains Substantial. Although the long-standing noncompliance is- sue has been resolved, the ADF’s capacity in managing social risks in compliance with the Project Reset- tlement Policy Framework (RPF) is still limited. The RPF was updated to elaborate processes to assess social risks, clarify entitlements of informal land users and tighten the linkage between social risk man- agement and subproject planning and execution processes. The ADF’s capacity in social risk management will continue to be strengthened under the AF. 44. The risk of implementation delays of construction works and travel restrictions for international experts due to the COVID-19 pandemic is reflected in the Other Risks category of the SORT and is currently rated as substantial. As a measure to mitigate the risk of implementation delays in combination with COVID- 19, that has delayed the implementation of several large procurements dependent on international ex- pertise under the parent project, a participatory urban planning activity was conducted in Ksamil with Urban Partnership Program (UPP) funding, which developed an urban design concept for the town of Ksamil. This will give the activities in Ksamil a head-start and it is expected that it will allow to progress much quicker to the stage of implementation of civil works contracts in Ksamil. 45. The risk ratings for the parent Project will apply to the AF also since it will be used to support scale-up of investments in the original project municipalities and on urban upgrading and infrastructure improve- ment in two new locations in the south of Albania, namely Ksamil and Orikum, which are closely con- nected to the municipalities and tourism sites supported by the parent Project. The additional invest- ments will fit the current scope of Components 1 and 3 under the parent Project and are very similar to ongoing investments. IV. APPRAISAL SUMMARY A. Economic Analysis 46. The economic benefits which are detailed in the original design of the PIUTD project also apply to the proposed AF. The AF will be used to support scale-up of investments in original project municipalities and urban upgrading and infrastructure improvement in two new locations in the south of Albania, namely Ksamil and Orikum. These two new locations are closely connected to the municipalities and tourism sites supported by the parent Project, and the additional investments will fit the current scope of Component 1 under the parent Project and are very similar to ongoing activities. Investments in urban Page 21 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) infrastructure can lead to improved urban livability, a reduction in vehicle operating costs and increased safety for both residents as well as tourists. Enhancement of cultural heritage assets leads to the preser- vation of the global public good. All these investments make the selected municipalities more livable and increase the willingness to pay by visitors and investors. The list of investments has been screened for economic and financial viability, visitor safety and experience as well as basic compliance with social and environmental safeguards for the two newly added project locations. 47. COVID-19 has impacted Albania’s tourism economy severely. While unforeseen in the original Project, this AF is also a critical tool to aid in the recovery process of the municipalities concerned. In the short- and medium-term the Project and the AF will support economic recovery through the employment gen- erated by its investments and construction works. 10 The Project and AF are characterized by urban up- grading and rehabilitation works as well as investments in underground infrastructure, which are labor- intensive works, contributing to the generation of employment and much needed income for the local population. A new indicator was added to the Project’s Results Framework measuring the generation of man-days of employment through the civil works in Ksamil and Orikum under the Project. The project activities under Component 3 will strengthen the ability of the collective tourism-related business com- munity to respond to changing demand patterns dictated by COVID-imposed restrictions or the relaxing thereof. In the long-term the project investments in urban infrastructure in tourism hubs and cultural heritage sites as well as strengthened capacity aim to contribute to the successful recovery of the tour- ism-related economy in the south of the country through both public and private sector activities. 48. All investments that will be selected for financing under the Project will be screened for economic and financial viability. Economic analysis, i.e. cost benefit analysis (CBA), is used as a screening device in the prioritization and identification of specific interventions. For relatively small investments, where data is not readily available and benefits are difficult to monetize, a cost effectiveness analysis (CEA) or multi- criteria analysis (MCA) will be carried out in place of a CBA. A screening process has already been applied at the stage of identification of the investment program in Ksamil and Orikum during project preparation. The proposed sub-projects have been screened for their compatibility with the PDO, technical feasibility, accessibility for all, environmental and social impacts as well as contribution to development goals under the integrated urban upgrading in Ksamil and Orikum (i.e. foster local identity, economic development, increase connectivity and quality of public spaces, foster residential functions, provide public/green spaces, increase human scale mobility). 49. The consultancy for Ksamil, which has been mobilized by the task team with financial support from the Urban Partnership Program (UPP) to further develop the concept ideas for the envisaged in-vestment program for Ksamil under the AF, has conducted preliminary CBAs for the overall envisaged investment program as well as for an exemplary investment of the Ksamil backbone. The CBA has shown strong economic benefits for the envisaged investment program in Ksamil, with the NPV amounting to EUR 28 million and the IRR to 31.12 percent. The exemplary CBA for the Ksamil back-bone sub-project has also shown high economic returns, with an estimated NPV of EUR 5.4 million and an IRR of 19.85 percent. A full economic screening process will be conducted for both Ksamil and Orikum during project implemen- tation as part of the IUDC consultancies to confirm the economic and financial viability of each invest- ment under the AF. 10 Word Bank Group. World Bank Group COVID19 Crisis Response Approach Paper, June 2020. Page 22 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) B. Technical 50. The AF will be used to support (i) scale-up of investments on urban upgrading and infrastructure im- provement (Component 1) as well as tourism market and product development (Component 3) in two new locations in the south of Albania, namely Ksamil and Orikum, which are closely connected to the municipalities and tourism sites supported by the parent Project and (ii) scale-up of investments in the original project municipalities of the PIUTD, i.e. Berat, Permet, Saranda and Gjirokastra, to meet the de- mand for additional investments under Component 1 which will contribute to the development objective of the Project but cannot be covered under the original loan. 51. So far, public investments have been very active in the south of Albania including investments imple- mented by the Albanian Development Fund and by the Government of Albania with the state budget as well as those supported by different Development Banks (see figure 1). A series of important interven- tions have been completed in the south of Albania such as; (i) ‘Lungomare in Vlorë’ an investment which transformed the seaside of Vlora completely, (ii) Requalification in Himara, Dhermi, Jale and Vuno vil- lages, and (iii) urban upgrading of Saranda city financed by the PIUTD. Other strategic investments are planned to be implemented in the other part of Vlora seaside through projects such as Lungomare (Lot II), the Re-qualifications of the seaside area of Radhime-Orikum and the requalification of Palasa seaside. The seaside areas of Borsh and Lukovë will be covered under the “Regional Development Program’ fi- nanced through KFW (see figure 1 below). Page 23 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Figure 1. Public investments in the South of Albania Source: Albanian Development Fund 52. While these investments cover the entire coast from the urban center of Vlora to Saranda, the Ksamil and Orikum seaside areas are the only two which are not covered by any public investments so far despite their great potentials for sustainable tourism and cultural development. The investments in Orikum and Ksamil proposed for the AF are expected to fully complete the touristic offer for all of southern Albania. Interventions in these two towns are not only important for the development of the specific towns but will also support the touristic and economic development of the South of Albania as a whole. 53. COVID-19 has stalled travel and tourism globally, with both supply and demand affected. Numbers of international travelers declined to zero in April, May and June of 2020 and with the country adopting international protocols for COVID-19 prevention, domestic tourism also ground to a halt. Once tourism restarts, however, the foundations and specific modifications to accommodate COVID-19 response and recovery by the Project and the AF will be important for the successful recovery of the tourism-related economy in the south of the country. In addition, in the short- and medium-term the Project and the AF will be able to support economic recovery related to the COVID-19 crisis through its investments and Page 24 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) construction works. 11 The Project and AF are characterized by urban upgrading and rehabilitation works as well as investments in underground infrastructure, which are labor-intensive works, contributing to the generation of employment and much needed income for the local population and, thus, recovery of the local economy. 12 54. The scale-up of investments on urban upgrading and infrastructure in Ksamil and Orikum will be similar to the ongoing investments under Component 1 of the parent Project, including a combination of up- grading of vehicular, pedestrian and multimodal accesses to the city and tourism attractions, strength- ening of pedestrian connections and trails systems, integrated street upgrading, upgrading of recrea- tional areas/parks and adaptive reuse of selected structures. To ensure a high degree of implementation readiness, the World Bank task team mobilized a consultancy for Ksamil and the Albanian Development Fund (ADF) mobilized a consultancy for Orikum, with the aim to develop project ideas for investments in these two locations with the available financing envelope, which the Integrated Urban Design consultan- cies, to be mobilized under the AF, can build on. These two consultancies produced an indicative list of sub-projects for Ksamil and Orikum, which can be adjusted depending on the financing preference of the government. 55. Following the integrated urban upgrading approach of the parent Project, each new location will be sub- ject to a detailed urban design study, which will allow the creation of a tailored package of investments with clear synergies, avoiding fragmentation, and aiming to achieve the greatest impact. The urban stud- ies will be done following a consultative process with selected municipalities and key project partners who will ensure that investments are (a) fully aligned with the PDO; (b) consistent with the GLDPs; and (c) prioritized and selected to support the development vision of each of the selected urban centers, ensuring complementarity and avoiding fragmentation. The tailored package of investments proposed as a result of the detailed urban design studies will need to be deemed satisfactory to the World Bank for project financing. Investments in Ksamil 56. Ksamil is a coastal town in the south of Albania which falls under the administration of the municipality of Saranda. Located on the south shore of the Mediterranean Sea close to the Greek border and close to the UNESCO site of Butrint, Ksamil is a popular destination of summer tourism as it combines both cul- tural and natural attractions. The National Park of Butrint, the Ksamil islands, the Lake of Butrint and the Vivar Channel are the main assets in and around Ksamil. The town of Ksamil has around 10,000 registered inhabitants, but only 3,141 are estimated to live in the settlement all year round, and in summer the amount of people in the town can go up to 70,000 including tourists, which puts significant stress on the infrastructure. Ksamil is facing the challenges of unplanned urban growth and informal development, inadequate urban infrastructure (missing pavements on secondary roads, street lighting as well as com- prehensive waste management and water supply systems), traffic congestion and lack of parking facilities especially during the summer tourist season, lack of public and green space, which limit the potential of the town to be more attractive to tourists as well as more livable to residents. Therefore, interventions will be focused on improving urban infrastructure and enhancing tourism assets. 11 Word Bank Group. World Bank Group COVID19 Crisis Response Approach Paper, June 2020 12 World Bank Group. GPURL Guidance Note. Labor-Intensive Public Works Response to COVID-19. May 2020. Page 25 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) 57. The total investments for integrated urban upgrading in Ksamil are estimated to be EUR 9.712 million 13, which will cover the following areas, among others: • Reconstruction of Ksamil Promenade and Waterfront Development: An integral part of the cur- rent waterfront is the promenade, which is characterized by its poor aesthetic aspect and non- functionality: its path is just five meters wide, with a physical separation in the middle and dilap- idated streetlighting. The existing promenade (approx. 1 km) will be widened and redesigned, and equipped with streetlights, trees, and urban furniture to offer an improved space for visitors and residents. The whole waterfront (approx. 90,000 m2) will also be redeveloped within the existing zoning plan, with a new plaza for recreational use created and new green buffer zones to enable a visual connection between the sea and the adjacent hill. The cost estimation for the envisaged investment is EUR 2.5 million. • Regeneration of the main axis Saranda – Ksamil (Ksamil backbone) and pedestrian-friendly street upgrade of secondary roads: the main street in the town leading from Ksamil to Saranda (Ksamil backbone) is in need of improvement; sidewalks are too narrow and in some places also damaged. The Ksamil backbone will be rehabilitated, including walking and cycling paths, street lighting, and planting of new trees. Several secondary roads in the town of Ksamil will be also upgraded with improved pavements and underground infrastructure. Walkable connections, urban furniture, improvement of signage to the seaside and the lake, and tree planting will be introduced. These investments will improve walkability and safety for pedestrians and enhance the attractiveness of the town of Ksamil. The cost estimation for the envisaged investments in the Ksamil backbone and secondary roads in Ksamil is EUR 3.8 million. • Lakefront activation: The Butrint Lake, located in the Western part of Ksamil, is a water basin of about 18 square kilometers. The lake is used as a production area for mussels, using outdated mussel production facilities. The natural harbor has the potential to be converted into a mussel production facility and lake marina. The AF interventions will completely regenerate the Butrint Lakefront area (approx. 30,000 m2) as a touristic attraction and an economic activity, by creating facilities for mussel producers, installing a mussel production visitor center, construction of a new pier, creation of new public spaces, etc. These investments will also create an enabling environ- ment for the private sector to open restaurants, cafes, and bars. The interventions will strengthen the connection between the seaside and the lakeside and draw increased attention from visitors to this part of the town. The cost estimation for the envisaged investment is EUR 1.6 million. • Beach rehabilitation: Leaving the historic center of Ksamil, Paradise Beach is located towards the end of Rruga Riviera road, about a 10-minutes’ walk south of Ksamil’s historic center. The beach is characterized by beautiful natural vegetation and large trees, however, its garbage problem and poor infrastructure for tourists are an issue. The beach rehabilitation will include the design of a small public space to improve interaction of visitors, structuring and upgrading of the whole beach 13The actual cost will be determined through the final design (including required safeguards assessments) under the IUDC to be financed by the AF Page 26 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) area as well as improvement of the connecting section of Rruga Riviera road. Urban upgrading of the beach area will involve the creation of clear zoning for bathing, relaxation and sports, creation of facilities for visitors (such as the Ksamil box) and of shaded areas for children and the elderly and implementation of a garbage management plan. The cost estimation for the envisaged in- vestment is EUR 470.000. • Ksamil box: Across different parts of Ksamil, the tourism beach infrastructure has been developed in an unstructured way by adding new facilities each yar. Most beach installations are temporary and have a poor appearance and are assembled just to serve for about eight weeks during the summer period, giving Ksamil’s beach areas a poor image. The aim of the intervention is to create a unified design for beach facilities, using the same color and design and to provide facilities such as showers and toilets at the beaches for inhabitants and visitors. A suggested design for the Ksamil box has already been prepared by the consultant which is a flexible module system that can easily be arranged and adapted for different uses. It will allow for offering a combination of services (such as selling of snacks and beverages) as well as provision of infrastructure (toilets and showers). The Ksamil box will be located in designated areas along the public beachfront of Ksamil and will help to create an identity for the beaches of Ksamil. The cost estimation for the envisaged investment is EUR 220.000. • Water supply system: The water supply system in Ksamil is in urgent need of upgrading. The in- habitants and visitors of Ksamil are currently only provided with drinking water for 7 hours a day during wintertime and for 16 hours a day during the summer season. The intervention will com- prise a full rehabilitation of the water supply system in Ksamil, including the pumping station, and the provision of modern metering equipment. The upgrade will provide inhabitants and visitors of Ksamil with drinking water for 24 hours a day throughout the year and will reduce water loss in the system. The cost estimation for the envisaged investment is EUR 560.000. 58. The proposal for interventions under the AF in Ksamil builds on the Ksamil Urban Lab report, a participa- tory urban planning initiative funded under the Urban Partnership Program (UPP) in collaboration with PIUTD that was published in summer 2019 as well as a follow-up consultancy during FY21, building on the work of the Ksamil Urban Lab to further refine the project ideas. The collaboration and funding pro- vided by UPP will give the activities in Ksamil a head-start and the urban design consultancy for Ksamil that will be mobilized under the AF will be able to build on the outputs of the Ksamil Urban Lab and its continuation. Thus, the design for the Ksamil urban upgrading is expected to be completed within a shorter timeframe than for the other project municipalities under the PIUTD, which will allow to move quickly to the implementation of works. Investments in Orikum 59. The town of Orikum is located in the southern part of the Albanian Riviera and in close vicinity to the City of Vlora. Orikum is known for its pristine coastline and hilly olive groves, as well as its proximity to Llogara National Park, the Karaburuni peninsula and the Orikum Lagoon. At the same time, the town which is situated on a continuous sandy beach next to a calm lagoon, offers archaeological, historical and cultural richness, given its proximity to Orik Ancient City archaeological part, the Pasha Liman military base as Page 27 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) well as the church of Marmiroi. Similar to Ksamil, Orikum has great potential for sustainable tourism development but has been constrained by the challenges of unplanned urban growth, inadequate urban infrastructure (missing pavements on secondary roads, street lighting and urban furniture), traffic con- gestion and lack of parking facilities especially during the summer tourist season, as well as a lack of public and green space. Orikum is also facing a lack of waste management and water supply systems. Therefore, potential interventions could be focused on improving urban infrastructure and enhancing tourism assets. 60. The total investments for urban upgrading in Orikum are estimated to be EUR 9.712 million 14, which will cover the following areas, among others: • Regeneration of coastline and construction of promenade: Despite the long stretch of a sandy beach, Orikum’s coastline is currently occupied by cars and does not offer quality space for resi- dents and visitors. The AF will invest in the coastline regeneration from the Orikum Marina to the Pasha Liman military base. The investments will involve constructing a promenade along the whole seafront (approx. 2.4 km), while also improving the public beach and installing facilities along the beachfront, such as toilets, showers, changing rooms, benches, etc. The promenade will be a light infrastructural platform for pedestrians and bikes accompanied by specific vegetation to create a pleasant trajectory to explore, discover and experience the varied landscapes of Or- ikum. Besides, new parking spaces will be built on a distance from the seashore to free the beach area and the new promenade from cars and traffic congestion. • Regeneration of the “Princess Rugjine” Boulevard: The ‘Princess Rugjine’ Boulevard (approx. 700 m) will be redesigned and repaved at certain parts to create more space for pedestrians. The most striking change will be adding a tree-lined pedestrian and bike lane running through the middle of the street. Along the boulevard, smaller interventions will be constructed, such as connecting to little park areas or introducing urban furniture. As part of this project, one square near the middle of the boulevard will also be redesigned with new pavement, seating, trees, and amenities. • Rehabilitation of city center public space: The urban core of the town of Orikum has an urgent need for qualitative urban spaces. The AF will rehabilitate the public space in front of the former city hall. The main square in front of the old city hall will become a large, paved space with trees planted in a grid. The facades of the building will be redone, and this square will become the new central public plaza for Orikum. • Construction of new parks and recreational area: The AF will invest in creating a new public parks to bridge the space between the urban core of the town of Orikum and the waterfront. The parks will run along two existing roads (Rruga Pasha Liman and Rruga Orikum) and will requalify the existing public space and make it accessible for recreational and sportive uses. The new part, i.e. the Sports Park (1 km strip), located between the former city hall and the waterfront, will create sports fields and playgrounds for young and old. 14The actual cost will be determined through the final design (including required safeguards assessments) under the IUDC to be financed by the AF Page 28 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) • Rehabilitation of public spaces in the urban core of Orikum: The urban core of the town of Orikum has an urgent need for qualitative urban spaces. The AF will rehabilitate the public spaces in front of the former city hall and the soccer stadium. The main square in front of the old city hall will become a large, paved space with trees planted in a grid. The facades of the building will be re- done, and this square will become the new central public plaza for Orikum. The public space in front of the soccer stadium will become a second public space to make the town more livable for the residents of Orikum and more attractive for visitors. The interventions in the public spaces will be implemented as fast-track investments. • Construction/rehabilitation of road bypass: The AF will improve the access and connection to the leading tourism and natural assets in the area, such as the archeological site Orik Ancient City, Marmiroi Church, one of the oldest churches in the Balkans, and the Karaburun Peninsula with the construction of a road bypass (approx. 6.7 km). The road bypass will also relieve the seashore of vehicular traffic. This project will consist mostly of widening and paving existing roads, most of which are in very poor condition, and will require constructing a new patch of road near the La- goon. The bypass will connect Orikum to the Karaburun Peninsula and will also serve the Pasha Liman Military Base, Orik Ancient city, and provide access to the Marmiroi Church. As part of these constructions, underground infrastructure (water and sewage) and streetlighting will be in- stalled/rehabilitated in a parallel effort to increase access to improved public infrastructure. • Construction of a fish market: As proposed by the General Local Territorial Plan (GLTP) for Orikum, the AF will finance the construction of a public fish market in Orikum. The fish market will be dedicated to both the wholesale between fishermen and merchants, and the sale of seafood to individual consumers. The fish market will be located in a covered hall at the waterfront close to the sports park entrance and will not only serve as a marketplace, but also as an area for activities, such as fish tasting, fish cooking classes, fish festivals, etc. Besides the attraction of tourists and locals to the market, the fish market will also support the local fishers and merchants’ economic activities. 61. The two new project locations - Ksamil and Orikum - have indicated their readiness for project imple- mentation. The ADF has already a long-standing relationship with the administration of the municipality of Saranda, which the town of Ksamil belongs to, because Saranda is one of the urban centers which is upgraded under the parent project. Similarly, the ADF already established a collaborative relationship with the administration of Ksamil as part of the participatory urban upgrading consultancy in Ksamil where the administrator of Ksamil was fully engaged. With the continuation of the consultancy for the identification of the investment program in Ksamil, which has been mobilized by the WB team through UPP financing, the collaboration with the administration of Ksamil will be further deepened. As regards Orikum, the ADF has already a long-standing fruitful relationship with the municipality of Vlore, which Orikum belongs to, because of urban upgrading activities in Vlore which have been implemented by the ADF and financed with government budget. 62. Besides investments in these two new locations, the proposed AF will also potentially support additional investments on urban upgrading and infrastructure improvement in the present Project municipalities, i.e. Berat, Permet, Saranda and Gjirokastra, to meet the demand for additional investments under Com- ponent 1 which will contribute to the development objective of the Project but cannot be covered under Page 29 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) the original loan. These additional investments will be identified based on the results of the ongoing design services of integrated urban upgrading for the municipalities, the financing envelope for each municipality under the original loan, and available budget from the AF after investments in Ksamil and Orikum. 63. The AF will also be used to support scale-up of activities on tourism market and product development in Ksamil and Orikum, which will fit within the current scope of Component 3 under the parent Project and are similar to the ongoing activities in the present Project municipalities, including development of new tourism products, adding value to existing products, strengthening tourism value chains and aggregating and connecting products to markets. 64. The implementation arrangements for the AF will remain the same as under the parent PIUTD project. The Albanian Development Fund (ADF) will continue to be the Project Implementing Unit (PIU) of the Project. The Project Coordination Unit (PCU) under the Ministry of Infrastructure and Energy (MoIE) 15 will provide oversight and guidance to the PIU. Other important stakeholders will remain the Ministry of Tourism and Environment (MoTE), the Ministry of Culture (MoC) as well as selected municipalities in the south of Albania. Detailed roles and responsibilities of these stakeholders are described in the updated Project Operational Manual (POM). C. Financial Management 65. Responsibility for the project’s FM will remain with the ADF, which will maintain an adequate project FM system, capable of tracking all project operations, resources, and expenditures and generating regular financial reports. The Bank’s fiduciary assessment 16 and supervision confirm that the existing project FM arrangements used, including budget and planning, accounting and reporting, funds flow and disburse- ments, internal control framework, and external audit, are adequate and meet the minimum require- ments of the Bank’s Policy and Directive on Investment Project Financing. The same arrangements will be adopted for the proposed additional financing. The World Bank team will monitor these arrangements continuously throughout implementation and will advise if gaps are identified, indicating the need for additional staff resources or control activities. To address the risk that the same expense is financed by two sources, the financial reporting, control activities, and audit terms of reference will be modified ac- cordingly. The overall FM risk after mitigation measures is Moderate. 66. Standard disbursement requirements will continue to be applicable to the Project. All project eligible expenditures will be entirely financed by the loan. The funds will be disbursed following standard Invest- ment Project Financing (IPF) disbursement procedures, including advances, reimbursements, and direct payments and special commitments. A segregated designated account (DA) denominated in loan cur- rency will be opened at the Bank of Albania. The advanced funds, earmarked for the proposed operation, will be transferred to project bank accounts for project use. Project eligible expenditures will be docu- mented through Statements of Expenditures and Records. The project disbursement arrangements will The Ministry of Infrastructure and Energy (MoIE) emerged out of the Ministry of Urban Development (MoUD). 15 An FM assessment was conducted in accordance with the Financial Management Manual for World Bank Invest- 16 ment Project Financing Operations (2010, revised 2017). Page 30 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) be managed by the ADF. Each source of financing will be linked to specific activities, except for the oper- ating costs under component 4, for which the original loan will be used first and then the additional financing. Detailed disbursement arrangements are set out in the Disbursement and Financial infor- mation Letter (DFIL). 67. Financial reporting and audits. With regard to the FM requirements to be included in the DFIL: (a) quar- terly project interim unaudited financial reports (IFRs), in the agreed form and substance, will be submit- ted to the Bank no later than 45 days after the end of each quarter; and (b) annual project financial statements will be audited by independent auditors acceptable to the Bank and based on international auditing standards, and the audited financial statements will be presented to the Bank no later than six months after the end of the fiscal year and made publicly available in a manner acceptable to the Bank. The project financial reports and statements will present all project sources and operations financed by original and additional financing loan. D. Procurement 68. Procurement capacity assessment. A procurement capacity assessment was conducted on ADF, which confirmed that its procurement capacity in implementing projects meets IBRD requirements. ADF has been effectively managing procurement activities under the Parent project and also under the World Bank Secondary and Local Roads Project (SLRP) and other infrastructure projects financed by IFI’s (KfW, EIB, IsDB, EBRD). The ADF has shown satisfactory performance in procurement for PIUTD so far. The ADF includes a management structure and is staffed with experienced procurement specialists, who are also implementing another World Bank financed project. Diligence is also observed in record keeping and quality of evaluation. The ADF is familiar with the World Bank’s bidding documents and procurement procedures. Despite adequate capacity, the following risks have been identified: (a) use of key staff qual- ification/experience for shortlisting of firms; (b) potential delays in selection process (including shortlist- ing phase, technical evaluation phase; (c) delays from bid evaluation to contract signature due to land property issues. Based on the assessment, the project procurement risk is Moderate. 69. Procurement for the AF will be carried out in accordance with the World Bank’s Procurement Regulations for IPF Borrowers for Goods, Works, Non-Consulting and Consulting Services, dated July 1, 2016 (revised in November 2017, August 2018 and November 2020). The Project will be subject to the World Bank’s Anticorruption Guidelines, dated October 15, 2006, revised in January 2011, and as of July 1, 2016 for procurement transactions. Use of Systematic Tracking of Exchanges in Procurement (STEP) is mandatory for all procurement transactions for post and prior contract review under the project to be respectively recorded in, or processed through the Bank’s planning and tracking system, STEP. 70. The ADF has prepared a streamlined Project Procurement Strategy for Development (PPSD) which will be finalized before implementation. An initial procurement plan for The Procurement Plan for PIUTD has been drafted and will be updated at least annually, or as required, reflecting actual project implementa- tion needs as well as improvements in institutional capacity. E. Social (including Safeguards) 71. The Additional Financing is being processed under the old Safeguards Policies as it would not change the Page 31 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Safeguards category or trigger a new policy; its environmental and social risks can be addressed in the context of the parent project; and its preparation was initiated in December 2019. 72. The Project has an overall positive social impact as it aims to improve tourism infrastructure and poten- tially increase income for the local population. No subprojects that involve land acquisition have been implemented under the original Project. The Project Resettlement Policy Framework (RPF) was substan- tially strengthened based on the experience of the original Project, in particular the Blue Eye noncompli- ance issue (see paragraph 26). The ADF already hired a senior social safeguard specialist and is currently updating the Project Operations Manual (POM) to strengthen subproject preparation and implementa- tion procedures and the Grievance Redress Mechanism (GRM). During the implementation of the original project, the government amended its expropriation law to explicitly recognize the use of international standards for investments financed by international financial institutions, which is expected to expedite the approval by the government of site-specific Resettlement Action Plans (RAP) which has slowed down preparation of some subprojects under the original project. No site-specific documents are required by appraisal of the AF loan since the specific investments have not yet been defined. 73. The implementation of the parent project revealed significant gaps in the ADF’s capacity to manage social and environmental risks and impacts. In order to strengthen the capacity of the ADF, a half-day environ- mental and social workshop was conducted in June 2020 where all ADF environmental and social staff as well as consultants who prepare and supervise subprojects received the training on the use of the project ESMF and RPF, including the scope of policy application and screening procedures. A local social consult- ant was also hired who will continue to provide hands-on implementation support to the ADF. The Bank team will continue to closely monitor project implementation throughout the life of the AF and provide hands-on support to the ADF. 74. Gender: The Government of Albania has been acknowledged for achieving significant progress in pro- moting gender equality. The World Economic Forum gave Albania scores of 0.99 and 0.98 in education and health gender gaps, respectively—both well above the global average of 0.73 17. Albania scored 91.25 out of 100 in the Women, Business, and the Law 2019 global index, highlighting the importance of re- forms mandating equal pay for work of equal value 18. Moreover, the legal framework favors social and economic gender parity and bars discriminatory practices, such as dismissing female workers who be- come pregnant or give birth 19. At the same time, there are still remaining obstacles to gender complete equality in Albania, which are also persistent in local governance. Due to competing needs and interests, municipalities are facing obstacles in prioritizing gender equality initiatives when deciding local budg- ets. 20 Institutional capacity constraints undermine the government’s ability to implement and monitor gender policies effectively. The Project is fully gender informed and promotes the participation of women in consultation processes and access to the benefits of the project. It is expected that among direct pro- ject beneficiaries at least 50 percent will be women. The ADF will also monitor the participation of female beneficiaries in the capacity building activities under Component 3 and, where necessary, take corrective actions to ensure gender inclusion. As part of the activities under both the parent project and the AF, the 17 A score of 1 means no gap exists between male and female outcomes. See WDI data for 2017 and WEF (2017). 18 World Bank. 2019. Women, Business, and the Law 2019: A Decade of Reform. World Bank, Washington, DC. 19 In December 2015. Parliament adopted Law 136/2015, “On some additions and amendments to Law No. 7961, dated July 12, 1995, the Labor Code of the Republic of Albania.” 20 UN Women and Austrian Development Cooperation. 2012. Gender Equality and Local Governance. Page 32 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Project will be committed to closely monitor gender impacts by disaggregating relevant indicators by gender as part of the project’s semi-annual progress reports and the Results Framework. Finally, the M&E surveys—conducted as part of the Project Result Assessment —will cover tourists, local residents, and firms and will be designed so as to allow the production of gender disaggregated results. 75. With funding from the Urban Partnership Program (UPP), the team has mobilized a consultant to carry out a Gender Assessment in the tourism sector in Albania. The Gender Assessment focused on the role of women entrepreneurs in the tourism sector in the south of Albania and looked particularly at the challenges women-led/owned SMEs are facing . The assessment also included an analysis of additional challenges brought about by the COVID-19 pandemic. The assessment was based on qualitative discus- sions with Women’s Associations and other NGOs, representatives from local municipalities and minis- tries and other stakeholders as well as available quantitative data. Focus group discussions have been held with small groups of women entrepreneurs in the municipalities of Saranda, Berat, Permet and Gjirokastra and the administrative units of Ksamil and Orikum. The research has identified gender gaps in the tourism sector as well as challenges the women are facing and has delivered a range of recom- mendations in the following areas: education and training, dedicated support to women’s entrepreneur- ship in tourism, improved working conditions for women in the tourism sector, tourism policy, legislation as well as gender data in the tourism sector. The findings of the Gender Assessment have been presented to national and local-level stakeholders in a dissemination workshop taking place in June 2021. The as- sessment and the workshop have set the stage for starting a dialogue with the GoA on how to address gender gaps in the tourism sector which will be further continued during the implementation of the par- ent project and the AF. Some recommendations of the gender assessment focusing on trainings for women entrepreneurs as well as data availability will also be addressed in the implementation of the parent project and the AF to further empower women in the tourism sector in Albania. 76. Citizen engagement. The Project comprises a set of activities focused on citizen engagement, including participatory needs assessment, stakeholders’ consultation workshop, participatory monitoring and a grievance redress mechanism. The ADF will provide citizens with up-to-date information needed to en- sure public awareness and active engagement on project activities through its website and using social media. The ADF follows guidelines regarding a participatory process for citizen engagement, which are outlined in detail in the updated POM and are summarized here. The consultants, in coordination with ADF and MoIE, will organize consultation workshops in the project municipalities which are taking place at each stage (inception, selection of investment program, preliminary design stage, final design stage) of the design process for all project activities under Components 1, 2 and 3. The participants of these workshops involve representatives of the concerned local and central authorities as well as local citizens, local civic, social, environmental and business organizations, and in the case of cultural heritage sites also UNESCO/ICOMOS. During these consultations, a participatory needs assessment will be conducted and information on all project-supported interventions distributed and discussed to ensure that local citizen’s inputs are taken into account in terms of site selection and design which allows for citizen engagement in the decision-making regarding the local investment program. The feedback loop will be closed after each stage by informing the citizens on the outcomes of the consultation processes in the next stage’s workshop and through the municipal and ADF websites at the final stage of the consultancy. The way the consultations are conducted will be adapted to address the COVID-19 reality and the consultants and ADF will adopt a virtual means of communications/online platforms. In this regard the WB conducted a training with ADF regarding an online platform which will facilitate virtual citizen engagement for all the Page 33 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) PIUTD sub-projects going forward. The CE process will also include a survey to track visitor perceptions of the subprojects and consider how the feedback provided in the survey can be integrated into subse- quent project activities. Under the AF an additional citizen engagement indicator will be introduced to further enhance monitoring of citizen engagement in the integrated urban upgrading process in project municipalities: “Percentage of municipalities that have engaged local citizens/project beneficiaries in an approved participatory process for the integrated urban upgrading.” The project’s grievance redress mechanism will routinely report and keep records of all salient issues or grievances which arise, the ADF will ensure timely follow-up and tracking of grievances to their resolution, as well as reporting the results of the GRM in their semi-annual progress reports which are published on the municipal and ADF website. F. Environment (including Safeguards) 77. Environmental. The Additional Financing is being processed under the old Safeguards Policies. The ESMF and RPF which were prepared under the parent Project outline the environmental and social manage- ment framework and resettlement policy framework which have been followed under the PIUTD project and will also be followed under the AF. Following supervision of the parent project, the ADF was required to appoint an Environmental Expert to ensure satisfactory management of the environmental, OHS and community safety risks and impacts of the project. ADF has now appointed an Environmental Expert and is required to strengthen internal capacity that will ensure satisfactory safeguards management for the various project activities. The ADF’s capacity in environmental risk management will continue to be strengthened during the AF. The ESMF of the Project will also need to be updated accordingly to address some of the Environmental and safety risks identified for some of the project components like the Benjac and Zvernec sub-projects. The AF will not trigger additional safeguards or will require financing beyond 10 years. The PIUTD project is a category B project and it is expected that this will also be the case for the AF as there will be similar investments as under the parent project. No site-specific documents are required by appraisal of the AF loan since the specific investments have not yet been defined. V. WORLD BANK GRIEVANCE REDRESS 78. Communities and individuals who believe that they are adversely affected by a World Bank (WB) sup- ported project may submit complaints to existing project-level grievance redress mechanisms or the WB’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address project-related concerns. Project affected communities and individuals may submit their complaint to the WB’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of WB non-compliance with its policies and procedures. Complaints may be sub- mitted at any time after concerns have been brought directly to the World Bank's attention, and Bank Management has been given an opportunity to respond. For information on how to submit complaints to the World Bank’s corporate Grievance Redress Service (GRS), please visit http://www.worldbank.org/en/projects-operations/products-and-services/grievance-redress-service. For information on how to submit complaints to the World Bank Inspection Panel, please visit www.in- spectionpanel.org Page 34 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) VI. SUMMARY TABLE OF CHANGES Changed Not Changed Results Framework ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Legal Covenants ✔ Implementing Agency ✔ Project's Development Objectives ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Safeguard Policies Triggered ✔ EA category ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Other Change(s) ✔ VII. DETAILED CHANGE(S) COMPONENTS Current Component Name Current Cost Action Proposed Component Proposed Cost (US$, (US$, millions) Name millions) Component 1: Urban 49.30 Revised Component 1: Urban 80.50 Upgrading and Upgrading and Infrastructure Improvement Infrastructure Improvement Component 2: Touristic Sites 9.40 No Change Component 2: Touristic 9.40 Upgrading Sites Upgrading Page 35 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Component 3:Tourism 8.60 Revised Component 3:Tourism 10.10 Market and Product Market and Product Development Development Component 4: 3.60 Revised Component 4: 5.30 Implementation Support Implementation Support TOTAL 70.90 105.30 LOAN CLOSING DATE(S) Ln/Cr/Tf Status Original Closing Current Clos- Proposed Proposed Deadline ing(s) Closing for Withdrawal Ap- plications IBRD-86560 Effective 31-Jul-2022 31-Jul-2022 31-Jul-2025 30-Nov-2025 Expected Disbursements (in US$) DISBURSTBL Fiscal Year Annual Cumulative 2017 0.00 0.00 2018 2,384,447.93 2,384,447.93 2019 7,899,340.99 10,283,788.92 2020 3,032,580.48 13,316,369.40 2021 4,498,607.58 17,814,976.98 2022 24,000,000.00 41,814,976.98 2023 20,000,000.00 61,814,976.98 2024 20,000,000.00 81,814,976.98 2025 20,000,000.00 101,814,976.98 2026 3,785,023.02 105,600,000.00 SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT) Risk Category Latest ISR Rating Current Rating Political and Governance  Moderate  Moderate Macroeconomic  Moderate  Moderate Sector Strategies and Policies  Moderate  Moderate Technical Design of Project or Program  Moderate  Moderate Page 36 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Institutional Capacity for Implementation and  Moderate  Moderate Sustainability Fiduciary  Moderate  Moderate Environment and Social  Moderate  Substantial Stakeholders  Moderate  Moderate Other  Substantial  Substantial Overall  Moderate  Moderate LEGAL COVENANTS1 LEGAL COVENANTS – Project for Integrated Urban and Tourism Development (PIUTD) (P155875) Loan/Credit/TF LEGAL TBL1 Description Status Action IBRD-86560 Finance Agreement :Urban Design Not yet due No Change Studies Satisfactory to the Bank | Description :The Borrower through MoUD shall cause the Project Implementing Entity (the Albanian Development Fund ADF) to ensure that any urban designs studies undertake under Component 1 are satisfactory to the Bank. | Frequency :CONTINUOUS IBRD-86560 Loan Agreement: Updating of the POM Not yet due New to the Bank’s satisfaction; Description: The Borrower through MoIE shall cause the Project Implementing Entity (the Albanian Development Fund, ADF) to ensure that the Project Operations Manual (POM) will be updated to the Bank's satisfaction. Deadline: 90 days after the Effectiveness Date. LEGAL COVENANTS2 LEGAL COVENANTS – Project for Integrated Urban and Tourism Development Additional Financing (P171438) Sections and Description Finance Agreement :Urban Design Studies Satisfactory to the Bank | Description :The Borrower through MoUD shall cause the Project Implementing Entity (the Albanian Development Fund ADF) to ensure that any urban designs studies undertake under Component 1 are satisfactory to the Bank. | Frequency :CONTINUOUS Conditions Page 37 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) VIII. RESULTS FRAMEWORK AND MONITORING Results Framework COUNTRY: Albania Project for Integrated Urban and Tourism Development Additional Financing Project Development Objective(s) The PDO of the proposed project is to improve urban infrastructure, enhance tourism assets, and strengthen institutional capacity to support tourism-related local economic development in selected areas in the south of Albania. Project Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_ PD O Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Improve urban infrastructure New or rehabilitated urban public spaces in 0.00 15,000.00 25,000.00 45,000.00 55,000.00 60,000.00 70,000.00 80,000.00 100,000.00 selected municipalities (Square Meter(m2)) Action: This indicator has been Revised Enhance tourism assets Increased number of visitors satisfied by 0.00 0.00 0.00 2.00 2.00 3.00 3.00 4.00 5.00 selected touristic sites (Percentage) Page 38 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ PD O Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Action: This indicator has been Revised Increased number of tourists visiting selected touristic sites 0.00 0.00 0.00 5.40 10.80 16.20 (Percentage) Action: This indicator has been Marked for Deletion Increased number of touristic sites with improved accessibility 0.00 0.00 2.00 2.00 2.00 5.00 7.00 9.00 11.00 (Number) Action: This indicator is New Strengthen institutional capacity to support tourism-related local economic development Number of municipalities with functioning destination 0.00 0.00 0.00 0.00 0.00 0.00 2.00 4.00 4.00 management partnerships in the project area (Number) Action: This indicator has been Revised Direct project beneficiaries (Action: This Objective has been Revised) Direct project 0.00 10,000.00 15,000.00 50,000.00 65,000.00 75,000.00 84,000.00 90,000.00 92,482.00 beneficiaries (Number) Action: This indicator has been Revised Page 39 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ PD O Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Female beneficiaries (Number) 0.00 5,000.00 7,500.00 25,000.00 32,500.00 37,500.00 42,000.00 45,000.00 46,241.00 Action: This indicator has been Revised PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_TBL_ IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Component 1: Urban Upgrading and Infrastructure Improvement (Component 1) Urban roads rehabilitated in selected municipalities 0.00 1.50 6.00 12.00 13.50 13.50 14.00 15.00 16.00 (Kilometers) Action: This indicator has been Revised (Component 1) Streets with improved street lighting in selected 0.00 4.50 6.50 9.50 12.50 12.50 14.50 17.00 19.00 municipalities (Kilometers) Action: This indicator has been Revised (Component 1) New or rehabilitated 0.00 3.00 6.00 12.00 14.00 14.00 16.00 17.50 19.00 pedestrian walkways in Page 40 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 selected municipalities (Kilometers) Action: This indicator has been Revised Number of municipalities that have engaged local citizens in an approved 0.00 0.00 2.00 4.00 4.00 4.00 6.00 6.00 6.00 participatory process for the integrated urban upgrading (Number) Action: This indicator is New Man-days of temporary employment generated under the Project through the civil works 0.00 0.00 0.00 0.00 0.00 0.00 1,500.00 3,500.00 5,500.00 in selected municipalities (Number) Action: This indicator is New Energy efficient streetlighting units installed in selected 0.00 0.00 0.00 0.00 0.00 0.00 0.00 33.00 66.00 municipalities (Number) Action: This indicator is New Component 2: Touristic Sites Upgrading Page 41 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 (Component 2) Number of Site Management Plans 0.00 0.00 2.00 4.00 4.00 4.00 5.00 5.00 5.00 developed and endorsed (Number) Action: This indicator has been Revised (Component 2) Integrated touristic sites designs developed 0.00 3.00 5.00 5.00 5.00 5.00 5.00 5.00 5.00 (Number) Action: This indicator has been Revised Increased number of visitors visiting selected 0.00 0.00 0.00 4.00 5.00 5.00 7.00 8.00 10.00 touristic sites (Percentage) Action: This indicator is New Component 3:Tourism Market and Product Development (Component 3) Market Development Strategy for the South of No Yes Yes Yes Yes Yes Yes Yes Yes Albania developed (Yes/No) Action: This indicator has been Revised (Component 3) Destination 0.00 0.00 2.00 3.00 4.00 4.00 4.00 4.00 4.00 Management Business Page 42 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 Plans Developed (Number) Action: This indicator has been Revised (Component 3) Number of touristic products developed with destination 0.00 0.00 0.00 10.00 15.00 15.00 20.00 25.00 25.00 management partnership support (Number) Action: This indicator has been Revised (Component 3) Number of municipalities with 0.00 0.00 3.00 4.00 4.00 4.00 4.00 4.00 4.00 improved management systems (Number) Action: This indicator has been Revised (Component 3) Capacity of local governments improved 0.00 5.00 5.00 10.00 15.00 15.00 20.00 20.00 20.00 through technical and managerial trainings (Number) Action: This indicator has been Revised Component 4: Implementation Support Page 43 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) RESULT_FRAME_TBL_ IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 (Component 4) Project website maintained with up-to date No Yes Yes Yes Yes Yes Yes Yes Yes information on project activities (Yes/No) Action: This indicator has been Revised Grievances registered related to delivery of project benefits 0.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 100.00 addressed (%) (Percentage) Action: This indicator has been Revised Grievances related to delivery of project benefits that 0.00 0.00 0.00 0.00 0.00 0.00 are addressed- (number) (Number) IO Table SPACE Monitoring & Evaluation Plan: PDO Indicators Mapped Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection New or rehabilitated urban public spaces Construction ADF Bi-annual in selected municipalities supervision Increased number of visitors satisfied by Beneficiary ADF Mid-Term and Closure selected touristic sites Survey Increased number of tourists visiting ADF Beneficiary Mid-Term and Closure Page 44 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) selected touristic sites Survey and visitors entry Cumulative number of touristic sites with improved accessibility (including interpretation), where works are implemented according to universal/inclusive design. Accessibility is defined as initial prerequisite for all and any visitors, including people with disabilities, elderly people, families with little kids, etc., to be Construction Increased number of touristic sites with able to reach and Biannual ADF supervision improved accessibility appreciate touristic sites. This includes accessibility planning and implementation to ensure that the tourism infrastructure is enhanced to meet the needs of both persons with and without disabilities, and people of all ages and physical abilities. Touristic sites include both touristic sites which are supported under Component 1 and 2. Number of municipalities with functioning Number of municipalities Biannual Local ADF destination management partnerships in with functioning Government Page 45 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) the project area destination management partnerships; Functioning partnerships are those having an annual work program. Cumulative number of people who benefited from the project (among which female); This only includes beneficiaries (residents) Local from urban upgrading and Multiple ADF Direct project beneficiaries Government infrastructure improvement in the six selected municipalities and does not include tourists. The numbers are based on census data. Female beneficiaries ME PDO Table SPACE Monitoring & Evaluation Plan: Intermediate Results Indicators Mapped Methodology for Data Responsibility for Data Indicator Name Definition/Description Frequency Datasource Collection Collection Kilometers of urban roads rehabilitated in selected municipalities. Selected (Component 1) Urban roads rehabilitated Biannual Construction ADF municipalities refer to all in selected municipalities supervision the project towns supported under Component 1. Page 46 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Kilometers of street lighting improved in selected municipalities. (Component 1) Streets with improved Biannual Construction ADF Selected municipalities street lighting in selected municipalities supervision refer to all the project towns supported under Component 1. Kilometers of pedestrian walkways - new or rehabilitated in selected municipalities; implemented according to universal/inclusive design to enhance accessibility. (Component 1) New or rehabilitated Pedestrian walkways are Biannual Local ADF pedestrian walkways in selected understood as sidewalks, Government municipalities promenades, pedestrian stairs, and pedestrian roads. Selected municipalities refer to all the project towns supported under Component 1. Number of municipalities that have engaged local citizens in an approved Integrated Number of municipalities that have participatory process for Urban engaged local citizens in an approved Biannual ADF the integrated urban Upgrading Co participatory process for the integrated upgrading. The citizen nsultants urban upgrading engagement process will be approved as part of the POM, and will ensure that Page 47 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) the feedback loop is closed by the municipalities reporting back to citizens on actions taken. Municipalities refer to all the project towns supported under Component 1. Number of Man-days of temporary employment generated under the Project through the civil Man-days of temporary employment works in selected Biannual Contractor ADF generated under the Project through the municipalities. Selected civil works in selected municipalities municipalities refer to the towns of Ksamil and Orikum only, which have been added under the AF loan. Energy efficient Construction Energy efficient streetlighting units streetlighting units Biannual ADF supervision installed in selected municipalities installed in selected municipalities (Component 2) Number of Site Number of Site Biannual Local ADF Management Plans developed and Management Plans Government endorsed developed and endorsed Number of Integrated touristic sites designs (Component 2) Integrated touristic sites developed. Touristic sites Biannual Local ADF designs developed refer to the touristic sites Government which are supported under Component 2. Page 48 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Increased number of visitors (in percentage) Mid-Term Beneficiary visiting selected touristic Increased number of visitors visiting and Survey and ADF sites. Touristic sites include selected touristic sites Closure visitors entry both touristic sites which are supported under Component 1 and 2. Market research and (Component 3) Market Development development strategy for Annual Progress ADF Strategy for the South of Albania the south of Albania Report developed developed Cumulative number of (Component 3) Destination Management destination management Annual Progress ADF Business Plans Developed business plans developed Report in selected municipalities Cumulative number of (Component 3) Number of touristic touristic products Annual Local ADF products developed with destination developed with destination Government management partnership support management partnership support Cumulative number of municipalities with improved management (Component 3) Number of municipalities systems. Selected Biannual Local ADF with improved management systems municipalities refer to all Government the project towns supported under Component 1. (Component 3) Capacity of local Measured through Annual Local ADF governments improved through technical cumulative number of Government and managerial trainings trainings to relevant staff Page 49 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438) Project website maintained (Component 4) Project website with up-to-date Biannual Progress ADF maintained with up-to date information information on project Report on project activities activities Percentage of grievances Grievances registered related to delivery Biannual Progress ADF registered that are actually of project benefits addressed (%) Report addressed Grievances related to delivery of project benefits that are addressed- (number) ME IO Table SPACE Page 50 of 51 The World Bank Project for Integrated Urban and Tourism Development Additional Financing (P171438)