Document of The World Bank FOR OMCLAL USE ONLY Report No. 11466 PROJECT COMPLETION REPORT BANQUE OUEST-AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) DECEMBER 22, 1992 Industry & Energy Operations Division Occidental and Central Africa Department Africa Regional Office 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 EOUIVALENTS Currency Unit = CFA franc (CFAF) Calendar 1983 April 1992 US$1.00 = CFAF 340 CFAF 260 1 SDR = $ 1.0769 $ 1.37016 FISCAL YEAR Banque Ouest-Africaine de Developpement - October 1 to September 30 Abbreviations and Acronvms BCEAO - Banque Centrale des Etats de l'Afrique de l'Ouest BOAD - Banque Ouest-Africaine de Developpement CEAO - Communaute Economique de lAfrique de l'Ouest DEG - Deutsche Entwicklungs Gesellschaft ECOWAS - Economic Community of West African States KfW - Kreditanstalt fur Wiederaufbau ITU - International Telecommunications Union UAPT - Union Africaine des Postes et Tel6communications UMOA - Union Monetaire Ouest Africaine WAF - West Africa FOR OMcAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-General Operations Evaluation December 22, 1992 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report--Banque Ouest-Africaine de Ddveloppement-- Regional Develooment Proiect (Credit 1331-WAF/Loan 2242-WAF) Attached is a copy of the report entitled "Project Completion Report--Banque Ouest-Africaine de Developpement (BOAD)--Regional Development Project" prepared by the Africa Regional Office with Part II contributed by the Borrower. The project succeeded in strengthening BOAD and helping it attract resources from other sources. However, the search for worthwhile projects too small for direct Bank lending, particularly those fostering regional integration, proved difficult. Prudently, project implementation was stretched out. Ten sub-loans were made, including two regional ones. The PCR is of adequate quality, although comprehensive information on subproject performance has not been presented. The project outcome is rated as highly satisfactory and its sustainability as likely. BOAD's financial position is strong, its management sound, and its development contribution substantial. The main lessons are that BOAD should enhance its portfolio monitoring practices and that the Bank should streamline its subloan review procedures. An audit is planned. Attachment This document has a restricted distribution and may be used by recipients only in the performance of their officld duties. Its contents may not otherwise be disclosed without World Bank authorization. I FOR OFFICIAL USE ONLY BANOUE OUEST-AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT TABLE OF CONTENTS PREFACE ............................... . EVALUATION SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . PART I PROJECT REVIEW FROM BANK'S PERSPECTIVE 1. Project Identity . 2. Background. Results of the First BOAD Project . . . . . . . . 2 3. Project Objectives and Description . . . . . . . . 3 4. Project Implementation . . . . . . . . . . . . . . 4 S. Project Results. 5 6. Project Sustainability . . . . . . . . . . . . . 6 7. Bank Group Performance . . . . . . . . . . . . . . 6 8. Borrower Performance . . . . . . . . . . . . . . 7 Financial and Operational Performance . . . . . 7 Interest Rate Structure . . . . . . . . . . . . 8 9. Consulting Services . . . . . . . . . . . . . . . 9 10. Project Documentation . . . . . . . . . . . . . . 9 PART II PROJECT REVIEW FROM THE BORROWER'S PERSPECTIVE 1. Evaluation of the IDA's Performance during Project Execution . . . . . . . . . . . . . . . . . . . . 10 2. Evaluation of BOAD's Performance during Project Execution ................... . 11 3. Bank Group/BOAD Relationship . . . . . . . . . . . 12 4. Project Impact on BOAD Operations and Finances . . 13 5. Conclusions/Lessons Learned . . . . . . . . . . . . 14 PART III STATISTICAL INFORMATION 1. Related Bank Loans ... . . .... . . . . . . . 16 2. Project Timetable ... . . . .. . . . . . . . . 17 3. Cumulative Estimated and Actual Disbursements . . 18 4. Project Implementation . . . . . . . . . . . . . . 18 5. Project Costs and Financing . . . . . . . . . . . 19 6. Project Results ................ . 20 7. Compliance with Credit Conditions . . . . . . . . 27 8. Use of Bank Resources . . . . . . . . . . . . . . 28 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. Table of Contents (continued) Paae No. ANNEX I Table 1 Comparative Balance Sheet . . . . . . . . . . . . . 29 Table 2 Comparative Income Statement. . . . . . . . . . . . 30 Table lb Balance Sheet 1986 - 1991 . . . . . . . . . . . . . 31 Table 2b Income Statement 1986 - 1991 . . . . . . . . . . . 32 Table 3 Financial Ratios. . . . . . . . . . . . . . . . . . 33 Table 4 Portfolio Arrears ............. ... . 34 Table 5 Analysis of Arrears (09/30/1991) . . . . . . . . . 35 Table 6 Summary of Operations by Category, by Sector, by Country and by Fiscal Year . . . . . . . . . . . 36 Table 7 Equity Ownership ................ . 38 Table 8 Financing Pattern of Operations . . . . . . . . . . 39 Table 9 Status of External Resources . . . . . . . . . . . 40 Table 10 Composition of Higher Level Staff . . . . . . . . . 41 CHART BOAD Organization Chart . . . . . . . . . . . . . . 42 BANOUE OUEST-AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT PREFACE This is the Project Completion Report (PCR) for a Regional Development Project to Banque Ouest-Africaine de D6veloppement (BOAD) to finance public and private sector projects in West Africa Monetary Union (UMOA) member countries. An IDA credit of US$14.0 million equivalent and an IBRD loan of US$6.1 million were approved on March 8, 1983 and became effective on June 10, 1983. The Credit was closed on March 29, 1991, following one extension of the Closing Date. By project completion, a total equivalent to US$18.49 million was disbursed. The last Loan and Credit disbursements were processed on January 16, 1990 and January 28, 1991, respectively. A total amount equivalent to US$1.61 million (including $565,620 from Loan proceeds) was canceled on July 31, 1991. Parts I and III of the PCR were prepared by the Industry and Energy Division of the Occidental and Central Africa Department. Part II was prepared by the Borrower. BOAD has reviewed Part I of the PCR and its comments have been incorporated in the report. The PCR is based on information provided by the Borrower, a mission to BOAD, the Staff Appraisal Report, the President's Report, supervision reports, legal documents and miscellaneous reports and correspondence in the project files. - ii - BANOUE OUEST-AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT EVALUATION SUMMARY 1. Obiectives. This was the second Bank Group project in favor of Banque Ouest-Africaine de D6veloppement (BOAD). Similar to the overall objective of the first credit (Project Preparation Credit - Credit 969-WAF), the objective of the second Project was to further strengthen BOAD in its developmental efforts and expand its role in regional integration. More specifically, the Project consisted of two components: (a) a line of credit equivalent to US$l9.1 million for financing of sub-projects in all sectors, except social infrastructure - health, education and housing; and (b) technical assistance equivalent to US$1.0 million (para. 3.01). 2. To emphasize the regional character of its operations, BOAD was to use at least half of the line of credit to finance regional projects, defined as those projects contributing to the integrated economic development of at least two states, of which at least one is a member of the West African Monetary Union (UMOA). In the case of infraBtructure projects, economic benefits should demonstrably accrue to more than one State (para. 3.03). 3. Implementation. Although the objectives of the Project, and particularly that of regional integration, were well understood by all parties concerned, so were the difficulties in achieving them. During implementation of the first BOAD operation, which aimed at financing feasibility studies for potentially viable regional projects, it had become clear to both BOAD and the Bank that identifying projects of a regional character would not be an easy task. BOAD's aim to utilize at least half of the line of credit to finance regional projects was not achievable, given the experience with the Project Preparation Credit. However, as most of the UMOA member countries were facing economic difficulties and were under structural adjustment programs, BOAD encountered serious difficulties in financing even national projects which conformed to the sector adjustment reforms. As a result, approvals were slow and implementation of approved sub-projects was slower than desirable (para. 4.01). 4. It became very clear during project implementation that the Bank and BOAD needed to work together more closely, early in the project cycle, to ensure that sub-projects conformed with the structural - iii - adjustment program in the country concerned. Early consultation on sub- projects did not always take place and resulted in delays as well as in the Bank's rejection of some sub-projects (para. 4.02). 5. Results. The line of credit, consisting of a Bank Loan and an IDA Credit equivalent to a total of US$ 19.1 million, was to finance public and private sector projects of regional interest, as well as national projects in UMOA member countries. A total of 10 sub-projects were undertaken. Two of the ten sub-loans were extensions, four were urban and six were rural. Of the ten, only two sub-projects could be considered as having regional impact: the Ponts Mono & Sazue project in Benin, providing major links on the CEDEAO coastal highway and the Centre Tri-Postal in Cotonou, a postal sorting project in Benin. The remaining sub-projects are essentially national in character. Five sub- projects had cost overruns ranging from 3% to 13%; investment costs of one sub-project were less than estimated; four sub-projects are not yet completed (para. 5.01). 6. The IDA line of credit financed seven sub-projects, for a total of SDR 9.7 million: 5 in rural development, 1 in telecommunications and 1 in infrastructure. The average subloan was SDR 1.4 million. No actual data is available on any of these. (Three are completed but not in operation and four are still under construction.) (para. 5.02) 7. The Bank line of credit financed three industrial sub- projects (2 agro-industries and 1 can manufacturing enterprise), representing a total equivalent to $ 5.5 million. All three experienced modest cost overruns ranging from 4% to 11%. One sub-project, SIALIM- CI, operated at a loss during 1989 and 1990 (1991 figures are not available), while the profitability of the other two enterprises has been improving. As far as employment creation is concerned, the results have been mixed. While COSMIVOIRE created 334 jobs at an investment cost of about $15,000, SIALIM-CI created 192 but at an investment cost per job of about $92,000. The third project, CARNAUD Senegal eliminated 114 jobs (para. 5.03). 8. The technical assistance component financed 8 feasibility and technical studies, mostly project related (Table 6, page 6). This component also financed, in 1987, a Ten-Year Retrospective Evaluation of BOAD, carried out by international consultants to evaluate its past performance and make recommendations for its future. The study, which was carried out by consultants and was supervised by a steering committee, in which the Bank had an observer, concluded that BOAD was a sound, well managed organization, with competent staff, systematic policies and procedures, and strong financial position and portfolio. The major recommendations of the study, which included a greater role for BOAD in regional integration, creation of an ex-post operations evaluation system, an annual review of level of provisions and greater decentralization in BOAD's decision making process were adopted by BOAD's management and have led to important institutional changes (para. 5.05). - iv - 9. Sustainabilitv. The Project has had a significant impact on the institutional capacity of BOAD and has helped expand its activities in areas which are useful and lasting: (a) it strengthened BOAD as a regional development bank. BOAD acquired experience, knowledge of what makes regional projects work and, now that it recognizes the constraints, political and otherwise, is in a better position to deal with them in the future; and (b) it exposed BOAD staff to management and review of studies performed by consultants and built up their knowledge in technical aspects of the sectors studied (para. 9.01). (c) encouraged BOAD to assess systematically, during appraisal, the environmental impact of sub-projects on the country concerned; (d) financed sub-projects in the public and private sector, which, although too early to assess in terms of success, have nevertheless contributed to the dialogue on integration of UMOA member States as well as to meeting their needs for water, better health, assistance to the disadvantaged communities and promoting the private industrial sector (para. 6.01). 10. Summary Conclusions and Lessons Learned. Project objectives were at least partially achieved. Strengthening BOAD as a regional development institution may be considered a clear success. BOAD clearly benefited from this operation and continued to strengthen its internal capacity in project appraisal and sectoral know-how; more importantly, it has been able to attract additional resources from other donors in the amount of CFAF 10.6 billion (France, Japan and AfDB), apart from the Bank/IDA Third Regional Development Project, approved in 1990, which provided a line of credit of US 55.0 million equivalent. The fact that the Bank Group approved in 1990 a third operation in favor of BOAD was an indication of the success which BOAD has continued to achieve since 1983. 11. As far as the line of credit is concerned, the success of the project is more mixed. Although the line of credit was almost fully utilized, the number of regional sub-projects financed was a disappointing 20%. Furthermore, none of the sub-projects financed by the Project was identified and studied under the Project Preparation Credit (para 2.06). The goal that BOAD would utilize at least fifty percent of the line of credit for regional projects was overly optimistic and not achievable. 12. The following are some of the lessons learned from this operation: (a) Since this Project was approved before the earlier Project Preparation Credit was completed, it did not benefit from the lessons learned from the first operation. For example, the goal of utilizing at least 50% of IDA/Bank funds for regional sub-projects would have been adjusted downward, to take into account the difficulties the first operation faced in identifying such sub-projects; (b) A lesson which goes beyond BOAD and this Project is that regional and sub-regional projects, involving more than one country, are scarce and difficult to realize in West Africa; (c) The success of regional sub-projects requires genuine commitment of member Governments and investors including concrete steps to harmonize their industrial policies. Given the economic and political environment in most UMOA Member countries, such a commitment proved more difficult than anticipated during Project appraisal; (d) From the institutional side, the BOAD/Bank relationship would greatly improve if BOAD played a more active role in involving the Bank Group and seeking its feedback on sub-projects, early in the project cycle. Such close consultation would not only reduce the time required to formulate a Bank decision on sub-projects but would also minimize their rejection by the Bank. On the other hand, if the Bank is to promote regional integration in Africa, it will be necessary to: (i) improve internal inter- departmental cooperation on issues affecting the UMOA countries; and (ii) be more rigorous with governments in promoting the harmonization of their industrial policies and business legislation; and (e) Finally, it is very clear in the case of BOAD that a Development Finance Intermediary (DFI) can perform profitably if it is properly nurtured and supported. BANOUE OUEST-AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT PART I: PROJECT REVIEW FROM BANK'S PERSPECTIVE 1. PROJECT IDENTITY Name : Regional Development Project Credit/Loan Number : 1331-WAF/2242-WAF RVP Unit : Africa Region Regional : Banque Ouest-Africaine de D6veloppement Sector : All sectors, except social infrastructure 2. BACKGROUND 2.01 The Banque Ouest-Africaine de D6veloppement (BOAD), was established in 1973 by the West African Monetary Union (UMOA) to further national development objectives of its six member states (Benin, Burkina Faso, Cote d'Ivoire, Niger, S6negal, Togo) and strengthen ties among them. Mali joined the UMOA in 1984. BOAD's broad mandate is to promote the economic integration and development among its members, to concentrate on the Union's poorer, landlocked members and to finance a higher Froportion of projects in these countries, with greater emphasis on infrastructure and rural development. BOAD also is required to promote regional economic integration between members and neighboring non-member countries. 2.02 When BOAD started operations in 1976, it benefitted from a UNDP Technical Assistance grant for which the Bank was executing agency. Under this grant, three World Bank staff were made available to BOAD to help the institution in its formative years. The Bank's fundamental goal in assisting BOAD has been to encourage it as the promoter of regional projects, to institutionalize a regional approach to development in West Africa and facilitate regional integration. The Bank and BOAD have maintained a close relationship. An IDA Project Preparation Credit was approved in 1979 to help finance feasibility and detailed engineering studies of potentially successful regional development projects. It was followed up by two IDA/IBRD blend operations which were approved in 1983 (Staff Appraisal Report No. 4124a-WAF), which relates to this PCR, and in 1990 (Staff Appraisal Report No. 8036-AFR). Both operations included IDA/IBRD lines of credit to finance regional investment sub-projects not only in the industrial sector but also in the agriculture, transportation and infrastructure sectors. - 2 - 2.03 BOAD makes term loans, takes equity participations, grants guarantees and carries out periodic economic, sector and project feasibility studies and extends technical assistance to its borrowers. The maximum exposure in any single project is 10% of BOAD's unimpaired capital, grants and reserves. The aggregate limit of BOAD's equity participations is 25% of paid-in capital, and the individual limit of each equity participation is 25% of the firm's equity or 5% of BOAD's paid-in-capital. BOAD's upper limit for project financing is set at CFAF 3.0 billion. As a regional bank BOAD endeavors to give greater priority to "regional" projects, defined as those whose ownership involves or whose benefits accrue to at least two states, of which at least one would be a member of the UMOA. In addition to its lending to Governments, BOAD makes loans to public as well as private enterprises. Since the start of operations in 1976, BOAD has succeeded in building up considerable expertise and has maintained a strong financial position and sound portfolio. 2.04 BOAD is, overall, a well-managed and financially-sound institution. It has strong leadership, rigorous management and competent staff and has become a credible institution within and outside Africa. Its staffing has increased from a total of 90 in March 1979, to the current total of 161 (9 executives, 57 professionals, 3 technical assistants financed by Switzerland and Belgium, and 92 support staff). In 1986, BOAD initiated a diagnostic study, financed by IDA, to evaluate its past performance, identify current problems, assess prospects and recommend improvements. The major recommendations of the study, which was carried out by consultants and was supervised by a steering committee, in which the Bank had an observer, were adopted and have led to major institutional changes, including the introduction of ex-post operations evaluation and an annual review of level of provisions. 2.05 In addition, BOAD has recently gone through a major re- organization. There are now five departments of which three are sectoral departments: (a) Rural Development and Infrastructure Department; (b) Industry, Financial Institutions and Energy Department; and (c) Human Resources Department. The Research and Programming and Financial Operations Departments existed before the re-organization. Another novel characteristic in the new organization chart is an Operations Evaluation Division under the Research and Programming Department. This is an area where the Bank has had extensive involvement with BOAD, including BOAD staff working closely with the Bank's Operations Evaluation Department. 2.06 Results of the First BOAD Proiect. The Regional Development Project is the Bank's second operation with BOAD. The first Bank Group assistance to BOAD was through the Project Preparation Credit (Credit 969-WAF) 1/, approved in 1979, which financed feasibility and engineering studies of regional projects. It was expected that the feasibility studies would identify viable projects which would subsequently be financed by BOAD and by a follow-up Bank operation. The I/ The PCR for the Project Preparation Credit (Credit 969-WAF) was issued on June 26, 1991 - 3 - Project Preparation Credit financed up to 85% of the costs of eighteen studies, most of which were for regional sub-projects in different sectors, including leather and tanning, textile, agricultural tool manufacturing, seed development, telecommunications, international transit centers and roads. Although there were high hopes at the beginning of project implementation that these studies would lead to viable regional projects, to be financed by follow-up Bank operations, the results were rather disappointing. Of the eighteen studies carried out, three have so far resulted in projects financed by BOAD: (a) the seed development study for UMOA countries, which resulted in a project in Senegal; (b) the telecommunications study in Casamance, to modernize the tele-communications network in Senegal; and (c) the study to modernize the Centre de Transit International in Ouagadougou, Burkina Faso. 2.07 The results of studies carried out for industrial projects have been equally disappointing. Such projects required regional markets which in turn required UMOA member Governments' commitment in harmonizing their industrial policies. Given the economic and financial difficulties that these Governments faced at the time and their preoccupation with implementing their respective structural adjustment programs, this commitment did not materialize. Many of the studies, are still under review by UMOA member countries. 3. PROJECT OBJECTIVES AND DESCRIPTION 3.01 Prolect Obiectives. The Regional Development Project represented a logical follow-up to the Project Preparation Credit (Credit 969-WAF). The Project was to provide BOAD with IBRD and IDA funds to finance sub-projects in Bank credit-worthy countries and IDA eligible countries of the UMOA, identified by the Project Preparation Credit. The overall goal of the Project was promotion of regional cooperation in the West African Monetary Union (UMOA) and Bank Group support to help BOAD attract additional resources from other donors to ultimately expand its operations. 3.02 Proiect Description. More specifically, the Project consisted of two components: (a) financing of sub-projects in all sectors, except social infrastructure - health, education and housing - (S19.1 million equivalent); and (b) technical assistance ($1.0 million equivalent): 3.03 Sub-proiect Financing. The bulk of Bank and IDA funds were to finance: (a) projects of regional interest, including projects for which feasibility studies were financed under the IDA Project Preparation Credit; and (b) national projects which are too small for Bank Group direct involvement and which aim at reducing imbalances between member countries and promoting complementarity with other countries in terms of production or market. To emphasize the regional character of its operations, BOAD was to use at least half of the line of credit to finance regional projects, defined as those contributing to the integrated economic development of at least two states, of which at least one would be an UMOA member state. In the case of infrastructure - 4 - projects, economic benefits should demonstrably accrue to more than one State. BOAD would not normally use the Loan and Credit funds to co- finance projects already assisted by the Bank Group, unless otherwise agreed by the Bank. 3.04 The two Bank eligible countries were asked to provide blanket guarantees for the amount of Bank funds used for sub-loans in their territory. This arrangement is consistent with the Articles of Agreement of the Bank. 3.05 Technical Assistance. The Project included a technical assistance component of an equivalent of $1.0 million, to be financed by IDA, to cover short-term consulting for project work, including appraisal, implementation and supervision of BOAD projects, in areas where BOAD did not have adequate expertise. The cost of these consultants were to be passed on fully or partially to sub-borrowers. 4. PROJECT IMPLEMENTATION 4.01 Although the objective of the Project, promotion of regional integration through investment projects, was well understood by all parties concerned, so were the difficulties in achieving it. During implementation of the Project Preparation Credit it had become clear to both BOAD and the Bank that identifying projects of a regional character would not be an easy task. BOAD's aim to utilize at least half of the line of credit to finance regional projects was not achievable, given the experience with the Project Preparation Credit. Furthermore, as most of the UMOA member countries were, at the time, facing economic difficulties and were under structural adjustment programs, it is not surprising that BOAD encountered serious difficulties in financing projects which conformed to the sector adjustment reforms. As a result, approvals were slow and implementation of approved sub-projects was slower than desirable. 4.02 During project implementation there were several occasions when the Bank disagreed with certain features of BOAD investment proposals. This disagreement resulted in unnecessary delays, and sometimes rejection of sub-projects, which could have been avoided if the Bank had been consulted by BOAD earlier in the project cycle. Although the Staff Appraisal Report (SAR) indicates that there was an agreement that such consultation take place, in fact, there was very little consultation during the preparation of investment proposals. 4.03 As the Project closing date approached, it became evident that full disbursement would not be possible, given the serious delays in completing the construction of a number of sub-projects. BOAD, therefore, requested Bank agreement to: (a) an extension of the closing date and (b) if extension was not possible, to an advanced disbursement of the committed Credit balance to finance the completion of these sub- projects; actual expenditures would be justified by BOAD, after the closing date. The Bank position on the closing date was that an extension was not justified, given the fact that the third BANK/IDA operation, the Third Regional Project, was effective and BOAD could utilize the proceeds of that operation to finance sub-projects. BOAD's second request for an advanced disbursement was not a feasible alternative, given the Bank's disbursement policy. 5. PROJECT RESULTS 5.01 Line of Credit. The line of credit consisted of a Bank Loan and an IDA Credit equivalent to a total of US$ 19.1 million to finance public and private sector projects of regional interest, as well as national projects in UMOA member countries. A total of 10 sub-projects were financed by the Credit and Loan proceeds. Two out of the ten sub- loans were extensions, four were urban and six were rural. Two sub- projects could be considered as having regional impact: the Ponts Mono & Sazue project in Benin, providing major links on the CEDEAO coastal highway and the Centre Tri-Postal in Cotonou, a postal sorting project in Benin. The remaining sub-projects are essentially national in character. Five sub-projects had cost overruns ranging from 3% to 13%; costs of one sub-project were less than estimated; four sub-projects are not yet completed. 5.02 The IDA line of credit financed a total of seven sub- projects, including three rural water supply projects in Benin, Burkina Faso and Niger, a livestock development project in Niger and an integrated rural development project in Senegal. Also financed were a telecommunications sub-project in Senegal and a highway/infrastructure project in Benin. The average subloan was SDR 1.4 million. No actual data is available on any of these. (Three are completed but not in operation and four are still under construction.) 5.03 The Bank line of credit financed three industrial sub- projects, 2 agro-industries and 1 can manufacturing enterprise, representing a total of $ 5.5 million. All three experienced modest cost overruns ranging from 4% to 11%. One sub-project, SIALIM-CI, operated at a loss during 1989 and 1990 (1991 figures were not available), while the profitability of the other two enterprises has been improving. As far as employment creation is concerned, the results have been mixed. While COSMIVOIRE created 334 jobs at an investment cost of about $15,000, SIALIM-CI created 192 but at an investment cost per job of about $92,000. The third project, CARNAUD Senegal eliminated 114 jobs. (For details see Table 6, pages 1 through 5). 5.04 Three of the sub-projects financed by the line of credit benefited also from other donor resources. The sub-project Mono-Sazue bridges was co-financed with AfDB, KfW and the CEDEAO Fund. IFC co- financed SIALIM-CI and Caisse Centrale de Cooperation Economique (CCCE) co-financed CARNAUD Senegal. The Project, overall, generated financing for sub-projects which iB more than three times greater than the amount estimated during appraisal (Table 5). 5.05 Technical Assistance. The technical assistance component financed 8 feasibility and technical studies, mostly project related. This component also financed, in 1987, a Ten-Year Retrospective Evaluation of BOAD, carried out by international consultants to evaluate - 6 - its past performance and make recommendations for its future. The study, which was carried out by consultants and was supervised by a steering committee, in which the Bank had an observer, concluded that BOAD was a sound, well managed organization, with competent staff, systematic policies and procedures, and strong financial position and portfolio. The major recommendations of the study, which included a greater role for BOAD in regional integration, creation of an operations evaluation system, the introduction of ex-post operations evaluation, an annual review of level of provisions and greater decentralization in BOAD's decision making process were adopted by BOAD's management and have led to important institutional changes (Table 6, page 6). 6. PROJECT SUSTAINABILITY 6.01 The Project has had a significant impact on the institutional capacity of BOAD and has helped expand its activities in areas which are useful and lasting. More specifically the Project has: (a) strengthened BOAD as a regional development bank. BOAD has acquired, as an institution, experience, knowledge of what makes regional projects work and, now that it recognizes the constraints, political and otherwise, it is in a better position to deal with them in the future; (b) exposed BOAD staff to management and review of studies performed by consultants and helped build up their knowledge in technical areas, including project analysis and appraisal, drafting of terms of reference, bid evaluation as well as sector specific knowledge, such as tourism, poultry breeding, telecommunications, quarrying, etc.; (c) encouraged BOAD to assess systematically, during appraisal, the environmental impact of sub-projects on the country concerned; (d) financed sub-projects in the public and private sector, which, although too early to assess in terms of success, have nevertheless contributed to the dialogue on integration of UMOA member States as well as to meeting their needs for water, better health, assistance to the disadvantaged communities and promoting the private industrial sector. 7. BANK GROUP PERFORMANCE 7.01 Overall, Bank performance was satisfactory. However, the Bank's responses to BOAD requests for comments on sub-projects, could have been faster. During project implementation, it appears that there were excessive delays in the transmission of Bank/IDA decisions to BOAD on certain sub-projects. While these delays were in some cases due to inadequate information received on sub-projects, they were also due to the fact that BOAD investment proposals required the review of other sector divisions in both AFI and AF5 Departments. As these divisions, -7- apart from AFlIE, did not have this task in their work program, a response from them was not always quick. Greater inter-departmental cooperation in the review of BOAD proposals would go a long way in accelerating Bank/IDA decisions on sub-projects. 7.02 The PCR prepared for the Project Preparation Credit in June 1991, raised a number of issues which are worth repeating here, as they apply to this operation as well. These relate to the focus and resources that countries gave to building their national industries, which sometimes resulted in industrial duplication and over-capacity. The Bank Group could have been more vigorous in engaging the countries in a dialogue on progressive harmonization of industrial, tax and trade policies, business legislation and projects at the regional level. Such efforts would have likely contributed to better results in achieving the goals of this Project. 8. BORROWER PERFORMANCE 8.01 BOAD's performance during Project implementation was satisfactory. The relationship that has existed between BOAD and the Bank Group since its establishment is excellent and is a factor in the close cooperation between the two institutions on this operation. BOAD was receptive to new ideas not only in relation to the Project but also on its overall operations. BOAD has recently taken a number of measures to improve the environment and encourage promotion of regional projects, including: (a) a study on the harmonization of national development policies which resulted in a General Action Plan on the basis of which regional projects are being selected; and (b) adoption by the UMOA Board of Ministers in 1990, of a strategy for private sector promotion and financing. 8.02 As mentioned earlier in the report (para 4.02), BOAD did not always seek the Bank's views on investment proposals early in the project cycle. Involving the Bank early on in the review of BOAD sub- projects is critical, if unnecessary delays and rejection on investment proposals are to be eliminated. Financial and Operational Performance 8.03 BOAD's financial position continues to be sound as reflected in its capital structure as well as its loan portfolio. It has a strong equity base, a high level of liquidity and a satisfactory earnings record. Investment projects financed by BOAD range in size from US$ 1.0 - 10 million, which are too small for direct Bank Group lending and too large for financing by national Development Finance Institutions (DFIs), most of which have slowly disappeared from the banking systems of UMOA member states. Loan approvals continue to reflect BOAD's cautious and very conservative operational approach. During the year ending September 1991, BOAD approved 9 projects, representing CFAF 15.7 billion. Since 1986, annual approvals have ranged from CFAF 12.7 billion to CFAF 15.8 billion, with an average of 9 operations annually. The energy and communications, and the rural development sectors dominate BOAD activities and represent, respectively, 39% and 35% of total operations. In terms of country exposure, 24% of total operations are in Senegal, with Burkina Faso representing 19% and Benin and Cote d'Ivoire representing 18% each. In terms of regional vs. national operations, about 21% of the total number of operations and 20% of total amounts reflect financing of regional projects. This is a modest increase over 1990 regional operations which represented 20% of total number and 18% of total amount. The bulk of BOAD operations continues to represent financing of national projects (Annex I Table 6). 8.04 Until 1989, BOAD had not experienced serious arrears problems. In 1989, arrears as a percentage of total loans outstanding was 7.1%, basically reflecting the deterioration of the macro-economic situation of its member countries. During 1991 the situation improved somewhat and the percentage dropped to 3.4%, following repayments from Benin and Niger. However, as of September 30, 1991, arrears, as a percentage of total loans outstanding has increased again to 6.1% and principal affected by arrears represented CFAF 13.1 billion (30.8% of total loans outstanding). This increase is mostly due to an increase in arrears from the productive/manufacturing sector. (Annex I, Table 4). 8.05 Although resources have so far been provided by institutions such as KfW, EIB and the Dutch and Swedish governments, BOAD management is now pursuing an aggressive policy to diversify its resources by approaching the international capital market to gradually reduce its dependence on official sources of funding. To meet this objective, BOAD's target is to raise, on commercial terms, up to US $ 80 million from the international capital market during the next five years. Interest Rate Structure 8.06 BOAD's General Policy Statement explicitly requires it to charge interest rates sufficient to fully cover the cost of its operations and to provide adequate provisions for portfolio risks. In line with this principle, the lending rates applied by BOAD are based on a computation that takes into account three variables: the cost of its borrowings; its administrative cost; and a fee to cover the exchange risk which BOAD assumes on its foreign borrowings. In view of the fixed parity between the CFA Franc and the French Franc, the exchange risk is limited to fluctuations between the French Franc and other foreign currencies in BOAD's outstanding liabilities. BOAD charges a fee of 2.45% p.a., which is included in its lending rate. This fee is adjusted annually on the basis of an analysis of past data on exchange rate fluctuations between the French Franc and other foreign currencies. 8.07 During appraisal of the Third Regional Project, approved by the Bank in FY 1990, it became clear that although BOAD's interest rates covered its cost operations, they were low, compared with prevailing domestic market rates in the UMOA countries. In order to rationalize its interest structure agreement was reached with BOAD on a new interest structure which consisted of: (a) a "commercial" rate which BOAD would use in financing all commercially-oriented, revenue-earning projects. This lending rate will be in line with prevailing UMOA commercial banking rates, which are currently up to 16% p.a.; and (b) a "special lending" rate to finance priority investments and "zon-commercial" enterprises, mainly in such sectors as rural development and basic infrastructure. This rate is set at a level to cover its full cost, currently 7.5 p. a. The establishment of a commercial window is more consistent with BOAD's developmental objective of increasing the share of the private sector in its future lending. The new interest structure is reviewed annually jointly by BOAD and the Bank Group to determine the need for adjustments. 8.08 Overall, BOAD is making significant efforts to improve not only its own efficiency and operations but also the financial environment in the UMOA countries. Other concrete efforts have also been introduced through the Bank/IDA Third Regional Project. Since the approval of this operation in 1990, BOAD has made substantial policy changes in its operations, including a revision of its interest structure. In its efforts to improve the financial sectors of the member states, it has carried out several studies, including a study on developing the leasing business in the UMOA countries and a study to establish new banking institutions of a cooperative mutualist type. It has also introduced private sector promotion in its development strategy and has designated a special unit in the organization to address private sector related issues. 9. CONSULTING SERVICES 9.01 The technical assistance provided contributed significantly to BOAD's capacity and technical knowledge in project preparation, analysis and appraisal. It also strengthened BOAD's sectoral knowledge and experience. The 10-year retrospective review enabled BOAD to rethink its development strategy and to re-organize itself to adapt to the needs of its Member countries. 10. PROJECT DOCUMENTATION AND DATA 10.1 Project documentation and data was adequate. Doc.:B:bosdci - 10 - BANQUE OUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT (CREDIT 1331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE 1. Evaluation of Bank Group Performance during Project Execution 1.01 Performance by the World Bank during execution of the project may be evaluated against the following criteria: - its response time to requests for authorization to fund subprojects; - its rate of rejection of requests for authorization to fund; - its contribution to the improvement of appraisal reports and terms of reference for studies; and - implementation of the Loan and Development Credit Agreements. Response Time to Fundina Authorization Rea'uests 1.02 Of 12 subprojects submitted for authorization to fund, response times varied from 1 to 10 months and averaged 5 months. Evaluation of this figure should take account of the following considerations: The first project completion report, on Development Credit 969- WAF, noted an average response time of 2.5 months. Decisions were based on reviews of terms of reference, although for projects they are based on reviews of appraisal reports, which are more substantial than terms of reference. - Some applications for funding approval led to requests for supplementary information. 1.03 Better coordination and consultation between the World Bank and BOAD should shorten these response times in future. Rate of Reiection of Fundina Authorization Requests 1.04 Out of a dozen subprojects submitted for approval to fund, five, or 41.67%, were rejected. Since one request was refused because of insufficient funds for onlending, the true rejection rate was - 11 - 33.33%, or one-third of the subprojects submitted. The rejections can be ascribed chiefly to the approach taken by the World Bank in certain sectors. Contribution to Improvement of Appraisal Reports and Terms of Reference 1.05 Generally speaking, the World Bank's observations on appraisal reports concerned matters of strategy, the quality of the reports not being called into question. For example, on refusing authorization to fund the Kassack-North irrigation development scheme in Senegal, the World Bank's position was substantially as follows: "Irrigation development in this region of Senegal is at present (May 24, 1990) in serious difficulties, and the World Bank is therefore not encouraging investment in new large-scale projects in this sector..., etc." This particular operation had been appraised six years previously. These observations led to BOAD's giving greater weight to SAL objectives in its appraisal of projects. Implementation of Loan and Development Credit Agreements 1.06 Throughout the execution of Development Credit Agreement 1331-WAF and Loan Agreement 2242-WAF, the World Bank demonstrated flexibility and receptiveness in responding to approaches by BOAD, with the following results: response times to drawdown applications were reasonable; closing dates for disbursements were deferred twice; - reallocation of balances undisbursed during the execution process was agreed to. 1.07 However, the World Bank did not agree to certain innovations, in particular advance disbursement of sums allocated to a number of subprojects, although verification of expenditure was to be provided subsequently, as is the case with other donors. 2. Evaluation of BOAD Performance durina Prolect Execution 2.01 Performance on the part of BOAD during the course of the project may be evaluated in terms of successes or failures with aspects of the implementation process. Successes 2.02 The elements in BOAD performance which contributed to the success of the project may be summarized as follows: - the ongoing consultation initiated by BOAD with the World Bank Group regarding directions to be taken, or matters to be treated more extensively, in connection with subprojects submitted for reimbursement under the line of credit; - 12 - the consultation initiated by BOAD with other cofinanciers regarding harmonization of subproject appraisal and execution procedures, resulting in speedier overall implementation; the degree of flexibility in BOAD procedures, which led to enhanced utilization of the line of credit as a consequence of redesign of certain subproject components following start-up delays, deferment of deadlines for drawdown of proceeds, and reallocation of undisbursed balances; subproject supervision missions carried out jointly with the other financial partners, again resulting in speedier overall implementation. Failures 2.03 These had to do mainly with the fact that the number of supervision missions was inadequate in some cases, since the technical personnel responsible for a heavy work program were thinly spread and concentrated on appraising new subprojects. However, recruitment of additional professional staff and the issue of operating instructions by BOAD management led to higher priority being placed on the supervision of subprojects already funded. 2.04 Despite the shortcomings referred to, the high rate of utilization of the line of credit is evidence of the effectiveness of BOAD's performance during the course of the project. Relations between BOAD and its Cofinancers 2.05 Throughout the project, BOAD placed particular importance on the cofinancing of subprojects so that new resources would be attracted to the subregion, risks could be shared with other partners, its own procedures could be fine-tuned and its expertise enhanced. 2.06 BOAD was intent on harmonizing donors' procedures and on organizing joint subproject appraisal and monitoring missions with cofinancers. The subprojects for which cofinancing arrangements were negotiated were the Mono and Sazue bridges, SIALIM-CI and CARNAUD (Senegal) -- the first with AfDB, KfW and the CEDEAO Fund, the second with IFC and the third with CCCE. 3. Bank Group/BOAD relationship during Proiect Execution 3.01 Throughout the project, relations between BOAD and the World Bank remained excellent. Progress was monitored regularly, chiefly at the time of follow-up missions to Lom6 by World Bank teams (at least twice a year) and the annual reviews conducted at the Annual General Meetings of the IMF and the World Bank. - 13 - 4. Proiect Impact on BOAD ODerations and Finances Sub-xroiects 4.01 In the public sector, the project provided funding for the following sub-projects: - two subprojects creating regional infrastructure facilities, namely the Mono and Sazue bridges (major links on the CEDEAO coastal highway) and the postal sorting office in Cotonou; - three village-level water development subprojects (in Benin, Burkina Faso and Niger); - a livestock development subproject in Niger; - an integrated rural development subproject in Senegal. 4.02 A total of four out of seven BOAD member States benefitted directly under the project. 4.03 In the private sector, the project contributed to BOAD's support of private initiative by funding three subprojects, namely COSMIVOIRE, SIALIM-CI and CARNAUD (Senegal). 4.04 The project thus provided support for BOAD action to foster the integration of its member States, meet community needs for water and better health, expand production systems, assist very disadvantaged communities, and promote private sector industrial activity. 4.05 An important element in all subprojects funded was a concern for their impact on the environment. Consulting Services 4.06 In general, project preparatory studies and consulting services funded under the provisions of IDA Credit 1331-WAF had a number of valuable secondary effects: - They improved BOAD capabilities in the area of project preparation, by giving its staff a better command of the drafting of terms of references, consultation procedures, bid evaluation techniques, and project analysis and appraisal. - They improved knowledge on the part of BOAD, its member States and other investors of certain spheres of activity (limestone quarrying, poultry breeding, tourism). - They provided an in-depth evaluation of 10 years of BOAD operations and organizational performance and of the impact of its programs on target groups, thus paving the way for necessary adaptations and realignments through internal reorganization, adoption of a development strategy, and - 14 - introduction of a strategy for promotion and funding of the private sector through a unit especially set up for that purpose. Imvact on Finances 4.07 The second project resulted in a positive financial flow of CFAF 5.801 billion, with drawdowns as follows: - Development Credit 1331-WAF CFAF 4.132 billion - World Bank Loan 2242-WAF : CFAF 1.669 billion TOTAL = CFAF 5.801 billion 4.08 This amount represented 22.55% of all BOAD drawdowns against borrowings as of September 30, 1991. 4.09 Repayments of principal have not yet begun on Development Credit 1331-WAF, which has a duration of 50 years including 10 grace years. 4.10 In short, the project has provided major backing for BOAD by making resources available on favorable terms and conditions in support of its development project financing program. 5. Conclusions/Lessons Learned 5.01 Evaluation of implementation of the second World Bank project shows that it had a beneficial impact as far as both operations and financing were concerned. This was a result of the care taken in selecting subprojects for funding, the sound performance record of the partners in the project, and the quality of the relations linking them. 5.02 As far as operations are concerned, the project provided BOAD with valuable support for its efforts to promote and fund integrated projects, encourage private sector industrial activities, assist very disadvantaged communities, improve knowledge of certain production systems, meet demand for water, and improve public health. 5.03 The project also enabled BOAD, on the basis of a retrospective analysis of its activities over 10 years (1976 to 1986), to fine-tune its organization, strategy and procedures, and consequently its performance record. 5.04 On the financial side, BOAD's drawdowns under the project, which as of September 30, 1991 represented 22.55% of all its drawdowns against borrowings, contributed significantly to its funding of development projects in the West Africa sub-region since it not only made resources available but did so on favorable financial terms and conditions. - 15 - 5.05 As far as the future is concerned, improvements could be achieved: - if it were possible, when necessary, to obtain advance disbursements against authorized credits at the approach of drawdown closing dates, with BOAD furnishing the necessary vouchers and verification subsequently; - if steps were taken to reinforce the arrangements for consultation between the World Bank and BOAD regarding the main lines of action to be pursued in various sectors, since this would reduce the rate of rejection of subprojects submitted for authorization of funding against lines of credit. 5.06 It is BOAD's earnest wish to see what it regards as the exemplary technical and financial cooperation between the World Bank Group and itself not only continue but expand as well, in support of its development strategy. - 16 - BANQUE OUEST AFRICAINE DE DEVELOPPELENT REGIONAL DEVELOPMENT PROJECT (CREDIT l331-WAF/LOAN 2242-WAF) PROJECT COMPLETION REPORT PART III: STATISTICAL INFORMATION 1. Related Bank Loans and Credits Loan Titlo Purposo Approvol Status (1) Credit 969-WAF To finance foasibility and 12/27/79 Cloced on 12/80/67 Banque Ouest detailed *ngineering studi*e Africaino de for regional development project. Developpement (BOAD) (2) Credit 2069-WAF To assist BOAD In providing 02/01/90 In progress Loan 8161-WAF financing to a broad spoctrus of Banque Ouest viable development projects in both Africalne de the privat. and public sectorc In Dev-loppement (BOAD) UMOA member countries. May 26, 1992 2. Project Timetable Item Date Planned Date Revised Actual Date Identification - - 10/18/1981 Preparation - Project Brief - - 12/28/1981 Appraisal Mission - - 09/28/1982 Credit Negotiations 12/82 - 12/15/1982 Board Approval - - OB/08/1988 Credit Signature - - 06/08/1988 Credit Effectiveness - - 06/10/1988 Credit Closing 06/80/1989 08/29/1981 08/29/1991 Project Completion - 08/81/lm May 26C 1M - 18 - S. Cumulative Estiated and Actual Disbursements FY34 FY85 FY86 FY37 FYS8 FY89 FY90 FY91 US$ million Appraisal estImte 8.10 7.50 13.70 20.10 Actual 0.05 0.99 2.91 4.58 11.08 14.78 17.56 18.49 e Date of final disbursement: Loan - January 1990 Credit - January 1991 - balanco was cancelled 4. Project Implementation No quantifiable Indicators were defined durlng the appraisal of this project. Project lplementation Is discuose In Part I, paragraphs 4.01 and 4.02. May 26, 1992 - 19 - 5. Project Costs and Financing A. Project Costs AppraisaL Estimates 1/ ActuaL .................... .................. ................................ -- - -- - - -- - -- - - -- - - Project Components Local Foreign Total LocaL Foreign Total ........... ....... ....... . .. ...... . ....... . .. ------- -------.... ............ ....... (USS Million) (USS MiLlion) 2/ Subproject Financing 9.2 17.2 26.4 80.0 17.6 97.6 Technical Assistance 0.1 1.0 1.1 0.1 0.8 0.9 Taxes 3.3 3.3 Total Costs (Net of Taxes) 12.6 18.2 30.8 80.1 18.4 3/ 98.5 B. Project Financing Sources of Funds Appraisal Estimates 1/ Actual -- - - -- - - ------------------ .... .. (USS Mfillion) (USS Million) 2/ IDA 14.0 12.9 IBRD 6.1 5.5 BOAD 2.9 19.3 Borrowers 7.8 60.8 ....... ......... .. Total Sources of Furds 30.8 98.5 1/ Bank Staff Appraisal Report No. 4124a-WAF 2/ Amounts may not be accurate because of SDR and USS exchange rate fluctuations 3/ A total equivalent to S3,730,991.60 (SDR 2,723,033.52) on the IDA Credit and US S 611,028.60 on the Bank Loan were cancelled May 26, 1992 - 20 - TABLE 6 P.9. 1 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1381-WAF PROJECT COMPLETION REPORT PROJECT RESULTS A. Sub-projoctn Characteristics of Subprojectn Financed under tho Loan Amount X of Total of Bank X of Amount of Number Subloins Total Number Bank Subloans SOR 1. SECTORAL DISTRIBUTION Rural Development 6 6,687,420 71.4 68.6 Postal Comunications 1 16063,268 14.8 17.0 Infrastructuro 1 1,400,670 14.8 14.4 TOTAL 7 9,721,868 100 100 2. DISTRIBUTION BY INVESTMENT COST _______________________________ * 8.0 to I 6.0 million 1 1,658,268 14.8 17.0 3 6.0 to 3 7.0 million a 65,26,308 42.9 54.3 * 7.0 to I 8.0 million 1 1,026,472 14.8 10.6 810.0 to 820.0 million 2 1,7165,16 28.6 17.6 TOTAL 7 9,721,868 100 100 8. DISTRIBUTION BY SIZE OF LOAN ____________________________ Lese than 1600,000 1 314,645 14.8 8.2 J 1.0 to I 1.6 million 4 5,601,778 57.1 56.6 I 1.5 to J 2.0 million 1 1,658,268 14.8 17.0 3 2.0 to 3 2.6 million 1 2,261,672 14.3 28.2 TOTAL 7 9,721,868 100 100 4. DISTRIBUTION BY COST PER JOB No information available 5. PROJECT LOCATION ________________ Rural 5 6,667,420 71.4 68.6 Urban 2 8,068,988 28.6 81.4 TOTAL 7 9,721,858 100 100 6. TYPE OF PROJECT Extension 0 0 0.0 0.0 New 7 9,721,858 100.0 100.0 TOTAL 7 9,721,858 100 100 May 26, 1992 - 21 - TABLE 6 Page 2 BANQUE GUEST AFRICAINE DE DEVELOPPEUENT REGIONAL DEVELOPMENT PROJECT LOAN 2242-WAF PROJECT COMPLETION REPORT PROJECT RESULTS Characteristice of Subproj.cts Financed under the Loan ------------------------------------------------------ Amount X of Total of Bank X of Amount of Number Subloons Total Number Bank Subloans ______ -------- ------------ ------------- 1. SECTORAL DISTRIBUTION Agro-Industri-n 2 3,211,833 66.7 58.6 Cornaud Senegal 1 2,277,138 sa.s 41.6 TOTAL 3 6,488,971 100.0 100.0 2. DISTRIBUTION BY INVESTMENT COST =______________________________ 8 6.2 million 1 600,779 33.3 9.1 I 11.8 million 1 2,277,188 33.3 41.5 8 17.8 million 1 2,711,064 U8.3 49.4 TOTAL 3 6,488,971 100 100 3. DISTRIBUTION BY SIZE OF LOAN =___________________________ Lese than 31,000,000 1 600,779 83.8 9.1 82,000,000 to 83,000,000 2 4,988,192 68.7 90.9 TOTAL 3 6,488,971 100 100 4. DISTRIBUTION BY COST PER JOB 8 16,000 1 600,779 33.8 9.1 8 92,000 1 2,711,054 33.3 49.4 No jobs were created 1 2,277,138 83.3 41.6 TOTAL 8 6,488,971 100 100 5. PROJECT LOCATION ________________ Rural 0 0 0.0 0.0 Urban 3 6,488,971 100.0 100.0 TOTAL 3 6,488,971 100.0 100.0 6. TYPE OF PROJECT _______________ Extension 2 2,777,917 66.7 60.6 NOw 1 2,711,064 s3.3 49.4 TOTAL 3 6,488,971 100 100 May 26, 1992 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT TABLE 6 REGIONAL DEVELOPMENT PROJECT Pag 3 CREDIT 1331-WAF / LOAN 2242-WAF PROJECT COUPLETION REPORT PROJECT RESULTS Llstirg of Subprojects Financed under the Loan Bank Subproject Sublonn BOAD Loan New or Location Number Name of Sub-borrower Sector Amount CFAF '000 Extension (R. or U.) ------- - - - - ------- - -- - ------ ------- SDR Credit 1331-WAF _________-____ A-1 Ponts Mono A Sarue - Bonin Infrastructure 1,400,670 U86,000 New Rural A-2 Fillemr Avicole - Niger Rural Development 1,026,472 419,370 Now Rural A-3 Hydroulique Villageolus - Bonin Rural Development 1,996,920 1,181,000 Now Rural A-4 Comunaute Base - Tendouck Senegal Rural Development 1,077,711 987,000 New Rural A-6 Centre de Tri-Postal -Cotonou Comunication 1,863,268 754,000 New Urban A-6 Hydrauliquo Villogeolue, Hou-t, Burkina Rural Development 2,261,672 1,326,000 New Rural A-7 Hydraulique Villogolse Tahous-Marvdl Rural Developmnt 314,646 2,180,000 New Rural 9,721,869 7,503,870 Loan 2242-WAF I A-1 COSMIVOIRE Ind./Soap 600,779 640,000 Extension Urban A-3 CARNAUD SENEGAL Ind./Motel cane 2,277,138 669,466 Extension Urban A-4 SIALIM-CI Ind./Milk Prod. 2,711,064 1,730,000 Now Urban 6,488,971 2,969,486 May 26, 19M BANQIUE OUEST AFRICAINE DE DEVELOPPEIIENT TABLE 6 REOIONAL DEVELOPMENT PROJECT Page 4 LOAN 2242-WAF PROJECT COWPLETION REPORT PROJECT RESULTS Performanco of Subprojecto Sales/Rovenuou Not Profit (Lose) Capacity CFAF m. CFAF m. Tons/year Sub-Project ------------------------ ----------------------- ____-_______________ Number Nam of Sub-Project 1989 1990 1991 1989 1990 1991 1989 1990 1991 … …… ------ - - - -- - - - - --- - - - -- - - - - - - - - -- - - - -- - - - - - A-1 COSMIVOIRE 8,908 7,697 9,086 120 107 347 17,730 17,730 17,730 A-3 CARNAW SENEGAL 4,110 4,803 n.m. 23 416 na. - - 2,700 A-4 SIALIM-CX 979 1/ 6,662 8,809 (242) (1,710) n.s. 31,600 31,00 81,500 1/ Rovonue. from 06/01 to 09/80/89 May 26, 1992 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT TABLE 6 REGIONAL DEVELOPMENT PROJECT Pago 5 CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT PROJECT RESULTS Performance of Subprojects Investment Couts Investment Costs Overrun/ Jobs created Per Job Subproject Sub-borrower'. CFAF '000 Und-rrun Est. Actual CFAF m. Number Nom Est. Actual t Est. Actual Credit 1331-WAF _______________ A-i Pontn Mono A Sazue - Benin 2,847,000 3,249,800 13 A-2 Fillere Avicole - Nig-r - 2,166,000 1/ A-3 Hydraulique Villageolso - Bonin 1,486,000 1,630,000 3 A-4 Co_ unaute Baae - Tendouck Senegal 1,494,000 1/ A-6 Contr- de Tri-Postal -Cotonou 960,000 927,490 (3) A-8 Hydraulique Villagoolas, Houet, Burkina 1,477,000 1/ A-7 Hydraulique Villageolsa Tahoua-Maradi 6,136,000 1/ Loan 2242-WAF A-1 COSMIVOIRE 1,360,000 1,400,000 4 364 334 4 4 A-3 CARNAUD SENEGAL 2,292,000 3,190,000 7 30 2/ n.a A-4 SIALIM-CI 4,328,000 4,799,000 11 127 192 84 26 1/ Projecto not yot completed and Information relevant to this table Is not yet available 2/ Projections not achieved because of the unfavorable economic environmnt; the company eliminated 114 jobs May 26, 1992 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT Table 6 REGIONAL DEVELOPMENT PROJECT Page 6 CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT PROJECT RESULTS S. Studle Studle Purpose Status Impact of Study - - - _ - _ _________ - ____ - -- - -- - --------- 1. Ten-Year Retrospective Evaluation Study to evaluste BOAD'o Completed The results of the study have been of BOAD operations and pertormnce Incorporated in BOAD's development during the previous ten strategy and organizational yers structure. 2. Chaux Industrielle, Bonin Feosbillity and mrk-t study Completed The studies will be the basis of a projected technical study. U 3. Hydraulique Villageole t Fealbillty Study Completed The study resulted In a project Poatorale (Tillabery) In Niger financed by BOAD, In the amount of CFAF 1,773 million. 4. Rural Road Ootheye-M_hana In Niger Technical Study Completed The study rosulted In a project financed by BOAD, In the amount of CFAF 1,262 million. S. Societe do Productlon Animal In Feolbillty and technical Completed BOAD and COFINCI have requeeted a Coto d'Ivoire (SOPACI) study for the rehabilltation complementary market study but are of SCPACI waiting for the Promoter's roaction. S. Irrigation In Baillol Marvin In Soclo-economlc studies Comploted The study provided the basis for Niger BOAD's evaluation of sociological aspecto of a project, for which BOAD financing aso CFAF 1,840 million. Table 6 Page 7 Studies Purpose Status Impact of Study … ----- …~~~~~~~- - -…- - - - - - - - -- - - - - -- - - - - - - - - - - - - - - - - 7. Tourim Project Ik Mamy-Wata A *ission to evaluate the Compl-ted The Promoter was unwilling to In Cote dIlvolre Project participate In the equity of the project. The project was abandoned. B. A.E.P. Tahoua/Dlrni and Galni Feasibility study Completed Project appraisal has been postponed In Nligr because of BOAD'a suapension of operations in Nilgr due to high arrears. May 26, 19W2 - 27 - 7. Compliance With Loan/Credit Conditions 1/ Deadlin. Section Covenant for Compliance Status 4.01 The Borrower shall maintain proceduroe and records ad.quat. to monitor and record tho progr-en of the project and of each Investment Project and to reflect in accordaneo with consistently maintained sound accounting practices the operations and financial condition of the Borrower. n.a. met 4.02 The Borrower shall have its accounts and financial statements for each fiscal year audited in accordance with sound auditing principles consistently applied by Independent auditors acceptable to tho Bank/IDA. The Borrower shall furnish the-o audits no later than six months after the end of each End of March met fiscal year. of each year 1/ Two soparate Guarantee Agreement were signed between the Bank and the the Ropublice of Senegal and of Coto d'Ivoiro. May 26, 1992 - 28 - S. Usz of Bank Resourc-n A. Staff Inputs Stage of Project Cyclo Staff Weekn Appraisal through Effoctiveneos 28.3 Supervision s8 TOTAL 88.3 s/ *1 This figuro my not be accurate. The Project was appraised before the first BOAD Projoct Preparation Credit (Cr. 969-WAF) was completod and was In progrone when the BOAD Third Regional Dovelopment Project was appraised. It Is, thereforo, most likely that there was an overlap in the tim accounted for supervision. B. Missions Performance Stage of Month/ Number of Days In Specializatlon Rating Project Cycle Year persons field reprosented Status Identification 10/81 2 8 PO 1 Appraisal 09/82 Supervision I 10/88 1 14 LO 1 II 9/84 1 6 PIO 1 III 4/85 2 8 SOO/00 1 IV 11/3s V 5/87 VI 2/89 1 8 PIO 1 VIi 10/90 2 10 OO/AA VIII 5/91 1 6 00 2 Preparation of Project Completion Report (PCR) 2/92 1 1/ 00 * Operations Officer 2/ 1 * Problem-troe or minor problems PIO a Principal Industrial Officer 2 * Moderate problems SOO a Senior Operations Officer 8 a Major problems PO * Project Officer AA * Administrative Assistant S/ 1 a Improving 2 a Stationary May 26, 1992 - 29 - BANQUE GUEST AFRICAINE DE DEVELOPPEMENT ANNEX I Credit 1331-WAF/Loan 2242-WAF Table 1 PROJECT COMPLETION REPORT Comparative Balance Sheet Position (CFAF million) 1963 1964 1986 1966 Actual Projected Actual Projected Actual Projected Actual Projected A S S E T S Net Current Assoes 6000 8006 13000 4814 16900 7480 22000 7674 Net Portfolio 16000 22232 20600 26691 22700 358677 23600 47267 Equity Participations 300 606 800 606 300 706 300 806 Net Fixed Assets 2900 3007 4300 3086 4000 2947 3900 2792 Other Assets 800 1877 900 2130 1200 2466 1100 2920 TOTAL ASSETS 28000 30626 39100 39226 44100 49476 60800 61448 LIABILITIES AND EQUITY Current Liabilities 0 91 100 96 0 107 100 143 Long-torn Debt 4900 7084 5800 10719 6200 16069 8000 20640 Grants/Funds 6800 12710 6600 16024 7800 17341 8100 19668 TOTAL LIABILITIES 10600 19886 12400 26838 14000 32617 16200 40441 EQUITY Capital 7600 7600 9600 9600 11300 12100 13600 14600 Reserves 2900 2794 5900 3141 7200 3787 9200 4868 Transfers from UMOA Member countrles 6000 9700 9200 9100 General Provisions 200 200 300 300 Rotained Earnings 800 347 1400 646 2100 1071 2400 1649 TOTAL EQUITY 17600 10741 26700 13387 30100 16968 34600 21007 TOTAL LIABILITIES A EQUITY 28000 30826 39100 39226 44100 49476 60800 61448 May 26, 1M - 30 - BANQUE OUEST AFRICAINE DE DEVELOPPEMENT ANNEX I Credit 1331-WAF/Loan 2242-WAF Table 2 PROJECT COWPLETION REPORT Comperative Income Statements (CFAF million) 1963 1994 1986 199# Actual Projected Actual Projocted Actual Projected Actual Projected REVENUES Interest A com issions 1352 1770 1687 2441 2114 3100 2235 4016 Investments 962 684 1290 636 1698 947 2195 1132 Oth-r 4 113 8 119 1 129 13 134 Total 2318 2467 2980 3196 3813 4176 4443 6332 EXPENSES Personnel 580 667 590 807 652 940 760 1058 Admlnistretive 483 684 510 642 598 781 667 U48 Depreciation 267 326 262 303 291 239 268 259 Financial Charge 252 464 337 703 399 1023 477 1430 Provisions 65 86 58 91 37 119 7 16 Oth-r Expenses S 4 6 4 4 3 2 2 Total Expenses 1632 2120 1753 2550 1981 3105 2181 3763 Net Profit 686 347 1227 646 1832 1071 2262 1649 May 26, 1M - 31 - ANNEX I Tablo lb 8ANQUE W JEST AFRICAINE DE DEVELOPPEMENT Balance Sheet (CFAF million) 1986 1987 1988 1989 1990 1991 (Unaudited) A S S E T S Not Current Assets 22,000 25,000 26,100 26,200 32,100 32,900 Not Portfolio 23,500 26,400 81,000 88,600 87,900 42,600 Equity Participations 300 400 300 2,800 2,400 2,500 Net Fixed Assxta 8,900 4,100 8,900 5,900 8,600 3,400 Other Assets 1,100 2,100 8,200 8,600 8,400 3,600 TOTAL ASSETS 60,900 67,000 64,600 74,000 79,300 85,000 LIABILITIES AND EQUITY Current Liabilities 100 200 700 2,100 1,400 1,400 Long-term Debt 8,000 8,700 13,000 13,600 15,000 16,300 Grants/Funds 9,100 10,000 18,700 18,300 20,800 22,500 TOTAL LIABILITIES 16,200 18,900 30,400 34,000 17,200 40,200 EQUITY Capital 13,800 14,200 14,800 16,000 16,000 16,000 -eserves 9,200 10,900 8,400 9,600 12,000 14,700 Transfers from UMOA Member countries 9,100 10,600 10,600 11,300 10,400 10,500 General Provisions 300 800 400 500 650 900 Retained Earnings 2,400 2,100 2,000 2,700 8,060 2,800 TOTAL EQUITY 84,600 88,100 34,100 40,000 42,100 44,800 TOTAL LIABILITIES A EQUITY 60,800 67,000 64,600 74,000 79,300 86,000 May 26, 1992 - 32 - ANNEX I Table 2b BANQUE OUEST AFRICAINE DE DEVELOPPEUENT Incom Statement (CFAF mIII on) 19i 1987 1988 1989 1990 1991 CUnauditMd) REVENUES Int rost A comissions 2,236 2,377 2,720 3,363 3,514 3,611 Investments 2,196 2,020 2,046 2,169 2,824 3,193 Othor 13 106 20 47 95 36 Total 4,443 4,603 4,786 5,689 8,433 6,839 EXPENSES Personnel 760 906 986 1,061 1,216 1,236 Administrative 667 788 826 833 796 s16 Doprociation 268 294 338 330 371 359 Financial Chargoe 477 9S8 736 801 826 934 Provisions 7 18 97 94 439 860 Other Expenses 2 2 1 - - - Total Expenses 2,181 2,673 2,982 3,119 3,648 4,194 Net Profit 2,262 1,930 1,803 2,460 2,786 2,646 May 26, 1992 - 33 - ANNEX I Table 8 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT Financial Ratios 1986 1987 1983 1989 1990 1991 (Unaudited) L.T. D-bt/Equlty Ratio 0.2 0.2 0.4 0.J 0.4 0.4 Total Debt/Equity Ratio 0.6 0.6 0.9 0.9 0.9 0.9 Current Ratio 220.0 126.0 87.8 12.0 22.9 23.6 Profit as X of Averago Total Assets 20.6 16.4 7.5 9.8 9.6 9.1 Profit as X of Average Equity 18.1 10.1 5.2 6.8 7.8 6.2 Financial Exp.s X of Avorage Total Assets 4.3 4.5 8.1 8.2 2.8 8.2 Administrative A Cen-ral Exp. as X of Average Total Assets 18.0 18.6 7.6 7.5 6.9 7.1 Income from Loan portfolio as U of Average Loan Portfolio 9.7 9.7 9.6 9.9 9.4 9.0 Provisions as X of Outstanding Loan & Invest't Portfolio 0.0 0.1 0.8 0.2 1.1 1.9 May 26, 1992 - 34 - ANNEX I Tablo 4 BANQUE WUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Portfolio Arrears 10/81/89 09/J0/90 09/30/91 1. Portfolio Arroars - Loans outstanding (U. CFAF) 36,600 37,800 42,600 - Arrears (M. CFAF) 2,682 1,279 2,688 (of which principal) 1,812 879 1,663 (of which interest) 1,270 400 1,026 As a percentage of total loans outstanding (3) 7.1 8.4 6.1 - Principal affected by arroars (M. CFAF) 18,620 7,240 18,100 As a percentage of total loans outstanding (3) 60.9 19.5 30.8 2. By Country (Million of CFAF) __________ - Bonin 1,112 65 161 - Burkina Faso 716 656 798 - Cote d'Ivoire 287 1 484 - Mali _ - Nig-r 418 S 888 - Senegal 89 569 819 - Togo 15 TOTAL 2,682 1,279 2,688 April =0,= _ April 80, 1992 - 35 - ANNEX I BANQUE OUEST AFRICAINE DE DEVELOPPEMENT Table 6 REGIONAL DEVELOPMENT PROJECT CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Analysis of Arr-arm 09/30/1991 Arrears as X Loans Principal Arrears as X of Loans Loans Affocted by Affocted by of Loans affected by Sector Outstanding Arrears Arrears Outstanding Arrears . . .. . .CFAF million. Rural Development 18,000 6,400 620 2.8 8.1 Infrastructure 600 90 - - - Energy, Comunications, Urban 16,100 8,400 170 1.1 6.0 Productive Sector 9,400 8,500 870 9.2 24.8 (Manufacturing) April 30, 1992 - 36 - ANNEX I Table 6 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Summary of Operations FY77-91 (CFAF Million) Equity Participations Loans Number Amount Number Amount Percent 1. By Category ___________ - Regional Projects 26 26,981 21 - National Projects 18 3,266 100 104,598 79 Total 13 3,266 126 130,479 100 = = -= 2. By Soctor - Rural Development 42 46,240 85 - Basic Infrastructure 5 4,662 4 - DFI lines of credits and loans to promotion offico 16 11,935 9 - Energy and Communications 42 51,437 89 - Other productive operations 21 16,215 12 126 130,479 100 Total - = 8. By Country __________ - Bonin 1 200 22 23,357 18 - Burkina Faso 4 1,100 25 24,831 19 - Cote d'Ivoire 2 700 19 28,837 18 - Mali 2 650 4 8,022 2 - Niger 1 200 17 18,306 14 - Senegal 1 5 81 31,874 24 - Togo 2 410 8 5,752 4 Total 18 8,266 126 130,479 100 - 37 - ANNEX I Table 6 BANqUE OUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1331-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Sui"Jry of Operations FY77-91 (CFAF Million) Equity Participation* Loans Number Amount Number Amount Percent 4. By Fiscal Year ______________ - 76/77 2 6S 6 1,996 2 - 77/78 8 5,488 4 - 78/79 40 7 2,694 2 - 79/80 1 200 8 4,664 4 - 80/81 9 6,227 4 - 81/82 6 4,940 4 - 62/83 8 6,890 S - 83/84 7 5,590 4 - 84/86 9 7,811 6 - 85/86 18 13,802 11 - 86/87 9 13,129 10 - 87/88 2 810 9 12,783 10 - 88/89 6 1,660 10 15,700 12 - 89/90 1 100 9 14,129 11 - 90/91 2 400 9 16,748 12 13 8,265 126 130,479 100 - 38 - ANNEX I Table 7 BANQUE WUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1831-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Equity Ownership (CFAF Million) To be Subscribed Shareholders Subscribed Called Paid-In Paid-In Uncalled Class A Bonin 8,000 1,860 800 1,060 6,160 Burkina Faso 8,000 1,860 800 1,060 6,160 Coto d'Ivoire 8,000 1,850 800 1,060 6,160 Mall 8,000 1,860 800 1,060 6,150 Niger 8,000 1,860 800 1,060 6,160 Senegal 8,000 1,860 800 1,060 6,160 Togo S,000 1,860 800 1,060 6,160 9CEAO 56,000 12,960 6,600 7,860 48,060 Total Class A 112,000 26,900 11,200 14,700 86,100 Class B France 4,600 4,600 2,000 2,600 -- Germany 1,000 1,000 1,000 -- -- EIB 00 500 5O0 -- -- ADB 2,000 500 500 -- 1,500 Belgium 1,600 800 800 -- 800 Total Class B 9,700 7,400 4,800 2,600 2,800 GRAND TOTAL 121,700 88,800 16,000 17,300 88,400 Authorized Capital not subscribed 18,800 Authorized Copital 140,000 April 80, 1992 - 39 - ANNEX I Table C BANQJE OWEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1881-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Financing Pattern of Operations FY77 - FY91 (CFAF Million) Self-financing/ Total OOAD Local private Project Cost Financing Co-financing Resources Governmnts Projects In private soctor 40,487 16,215 12,390 11,882 Regional projoctn 102,118 25,631 5U,595 17,008 684 National projects In the public soctor 829,389 91,643 154,846 44,608 89,287 TOTAL 472,489 188,744 225,831 72,998 89,871 April 80, 1992 - 40 - ANNEX r Table 9 BANQUE OUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1831-WAF/LOAN 2242-WAF PROJECT COMPLETION REPORT Status of External R-sources (CFAF Million) Non- reimbursable Grant/ Technical Sourco Equity Borrowings Assistance Total 1 Bilteral Belgium 1,600 8,306 1,092 6,000 Francs 4,600 18,884 U 28,670 Germany 1,000 4,468 866 6,818 India 2,833 2,883 Japan 4,266 4,266 Netherlands 148 148 Scandinavian Countrioes 2,833 2,838 Switzerland 8,087 4,144 7,181 Sub-total 7,200 89,619 6,820 62,689 2. Multilateral ADB/ADF 2,000 11,021 18,021 EDF 36 8S EIB 500 6,841 6,841 IBRD/IDA 28,442 613 23,966 UNDP 429 429 OMVDI 62 62 Sub-total 2,600 40,804 1,089 43,848 Grand-total 9,700 79,928 6,869 96,482 April 30, 1992 ANNEX I Table 10 BANQyE GUEST AFRICAINE DE DEVELOPPEMENT REGIONAL DEVELOPMENT PROJECT CREDIT 1831-WAF/LOAN 2242-WAF PROJECT COiPLETION REPORT Composition of Higher Level Staff a/ Financial Accountants/ Computer Departments Analysts Economists Enginoers Laywors Administrators Speciallsts Total DDRI 4 9 1J DIFI 6 2 4 1 1J DARH 2 5 a 10 DOFIC 4 1 4 9 BSO 1 a 4 3 DRP 2 3 2 2 9 BAI 1 1 Presidency 1 1 1 3 TOTAL 20 6 1S 4 10 J 00 r/ Excluding the President and Vico Presldent. BOAD currently has J expatriate ongineers: 1 from Switzerland, In DDRI and 2 from Belglua, in DDRI and DIFI). April 30, 19M MANQOR OUKST AFRICNAINI OIRGlUHIGRAENE D8 DKVElOPPBUKJT (BO&D) CABIN ET DU PRESIDENRT . PULESIDENCZ "~~~~~~~~. A . *.VA VICIE-1M K BUREAU SECRET.C.EKER. M. TCHDfl"IJth DURZAC AUDIT INTERlUE l~~~~ ~ ~~~~~ Iha . _I _ DEPARTEMEHT DEPARTEsElT DEPARTEHENT DEPALRTEME.T DEPR TEHENT RECHERCHE ET DEVEISPEMT RURAL INSTITUT. FINANC ADMlNISTRAT. ETOPERAT. FIIIAAC. PROGRAHH^TIO14 E IHFRASTRc ET INDUSTRIES RESSOURC.HUKhlMS ET COffPSAIBLFS n. m l ". slut t ". wTI . ". t"u | ".tt~L