The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) Djibouti Affordable Housing Finance Project (P176772) MIDDLE EAST AND NORTH AFRICA | Djibouti | IBRD/IDA | Investment Project Financing (IPF) | FY 2023 | Seq No: 4 | Archived on 18-Sep-2024 | ISR01503 Implementing Agencies: Agence de Réhabilitation Urbaine et du Logement Social (ARULOS)., Fonds de Garantie Partielle des Credits de Djibouti (FGPCD) 1. OBJECTIVE 1.1 Development Objective Original Development Objective (Approved as part of Approval package on 20-Dec-2022) The Project's Development Objective is to expand access to affordable housing finance for underserved populations in the Recipient’s territory. Has the Development Objective been changed since Board Approval of the Project Objective? No 2. COMPONENTS Name Mortgage guarantee mechanism:(Cost 7,000,000.00) Innovative financing of affordable housing:(Cost 5,500,000.00) Technical Assistance and Project Management:(Cost 2,500,000.00) 3. OVERALL RATINGS Name Previous Current Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Moderate Moderate 4. KEY ISSUES & STATUS Sep 18, 2024 Page 1 of 8 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) 4.1 Implementation Status and Key Decisions This update provides a summary of the current implementation status and key decisions following the March 2024 support mission and subsequent technical meetings through August 2024. • - Partial Guarantee for Housing Loans: Partnership agreements with key banks have been signed, and the first mortgage applications have been submitted under the guarantee scheme. Ongoing efforts are focused on increasing the number of eligible housing units and engaging with interested banks on the available housing offer, beneficiary interest and their ability to secure a loan. • - Affordable Housing via Self-Construction: Three self-construction modules have been established to support households in the Capital’s old districts. The selection process for beneficiaries is being finalized, and agreements for construction material procurement have been completed with local vendors. • - Conversion of Leases into Mortgages: An international consultancy has completed preliminary work on converting lease-to-own contracts into mortgages. The process of engaging banks and reaching out to potential beneficiaries is underway. • - Housing Sector Reform and SME Capacity Building: Collaboration with key ministries and the Chamber of Commerce has led to the development of an action plan focusing on construction sector reforms, professional training for youth, and support for SMEs. Initial outcomes are expected in the coming months. - Technical Assistance to the Central Bank: The Central Bank has developed a plan for technical assistance in several areas, including monetary statistics, regulation, and financial stability. The launch of these activities is underway. 5. SYSTEMATIC OPERATIONS RISK-RATING TOOL Rating at Approval Last Approved Rating Risk Category Approval Package - ISR Seq. 03 - 26 Feb Proposed Rating 21 Dec 2022 2024 Political and Governance Substantial Moderate Moderate Macroeconomic Substantial Moderate Moderate Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Moderate Moderate Moderate Sustainability Fiduciary Moderate Moderate Moderate Environment and Social Moderate Moderate Moderate Stakeholders Moderate Moderate Moderate Sep 18, 2024 Page 2 of 8 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) Overall Moderate Moderate Moderate Sep 18, 2024 Page 3 of 8 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) 6. RESULTS 6.1 PDO Indicators by PDO Outcomes Mortgage guarantee mechanism Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of low-to-middle 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 2,000.00 Dec/2027 income households Comments on this assumes a leverage of 5x , coverage of 50% and an average mortgage loan guaranteed of benefitting from affordable achieving targets US$35,000 mortgage loans partially guaranteed by the FGPCD (Number) Number of women 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 800.00 Dec/2027 benefitting from affordable mortgage loans guaranteed (sole or in a new joint ownership) (Number) Innovative financing for affordable housing Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of poor households 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 450.00 Dec/2027 benefitting from self- Comments on Those are households considered poor in decile 1-5 benefitting from the self-construction construction finance achieving targets projects funded by both ARULoS and the microfinance institutions under the line of credit in (Number) Phase 2 Page 4 of 9 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) Number of women 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 150.00 Dec/2027 benefitting from self- construction, owning the title or in a new joint ownership (Number) 6.2 Intermediate Results Indicators by Components Mortgage guarantee mechanism Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of financial 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 6.00 Dec/2027 institutions that use the housing guarantee fund (Number) 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 70,000,000.00 Dec/2027 Private capital mobilized from Comments on this reflects the private capital mobilized from financial institutions through the guarantee as banks via the housing achieving targets they will use their liquidities to issue loans - assumption US$7 million capital, leverage of 5x, guarantee (Amount(USD)) 50% coverage - can guarantee US$70 million of loans Innovative financing of affordable housing Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of low-to-middle 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 250.00 Dec/2027 income households Comments on this reflect the number of rent-to-own contract converted into mortgage based on about 10 converting rent-to-own Page 5 of 9 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) contracts into mortgage loans achieving targets percent of the current and future stock (ie. contracts that were supposed to be rent to own (Number) become mortgage loans) Number of financial 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 2.00 Dec/2027 institutions which use the Comments on This reflects that 2 microfinance institutions are interested in using the credit line for self- microfinance credit line achieving targets construction (Number) Number of housing units 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 450.00 Dec/2027 resilient to climate-induced Comments on This reflects the self-construction projects certified by ARULoS as resilient to fires and floods floods and fires (Number) achieving targets Annual surveys of potential No Dec/2022 No 21-Nov-2023 No 22-Aug-2024 Yes Dec/2023 and existing beneficiaries Comments on ARULoS will perform annual surveys of existing and potential beneficiaries. The first survey in whose results inform the achieving targets Year 1 will identify potential beneficiaries of the self-construction to be financed by design of the microfinance microfinance institutions, and will inform the design of the line of credit under Component line of credit and mortgage 2a.The feedback received through the annual surveys will be used to adjust the design of the guarantee throughout the microfinance line of credit and mortgage guarantee during the project’s implementation. project’s implementation (Yes/No) Technical Assistance and Project Management Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of regulatory reforms 0.00 Dec/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 5.00 Dec/2027 adopted to promote Comments on The reflects policy or tax reforms adopted affordable housing and lower achieving targets construction costs (Number) Number of people trained on 0.00 Oct/2022 0.00 21-Nov-2023 0.00 22-Aug-2024 300.00 Dec/2027 climate resilient and energy Comments on Number of people trained on energy efficient construction and low-carbon material (60 per efficient construction achieving targets year) techniques (Number) (Number) Page 6 of 9 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) Page 7 of 9 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) 7. DATA ON FINANCIAL PERFORMANCE 7.1 Cumulative Disbursements 7.2 Disbursements (by loan) Loan/Credit/TF Status Original Revised Cancelled Disbursed Undisbursed % Disbursed IDA-72590 Effective 15.00 15.00 0.00 7.87 7.63 52.49% 7.3 Key Dates (by loan) Loan/Credit/TF Status Approval Signing Effectiveness Orig. Closing Rev. Closing IDA-72590 Effective 21-Dec-2022 22-Dec-2022 12-Apr-2023 31-Dec-2027 31-Dec-2027 8. KEY DATES Sep 18, 2024 Page 7 of 8 The World Bank Implementation Status & Results Report Djibouti Affordable Housing Finance Project (P176772) Key Events Planned Actual Approval 21-Dec-2022 21-Dec-2022 Effectiveness 12-Apr-2023 12-Apr-2023 Mid-Term Review No. 01 19-Dec-2025 Operation Closing/Cancellation 31-Dec-2027 9. RESTRUCTURING HISTORY 10. ASSOCIATED OPERATION(S) There are no associated operations Sep 18, 2024 Page 8 of 8