Document of The World Bank FOR OFFICIAL USE ONLY Report No. 17750 IMPL]EMENTATION COMPLETION REPORT ETHIOPIA EMERGENCY RECOVERY AND RECONSTRUCTION PROJECT (Credit 2351-ET) April 30, 1998 Transport I Africa 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 Currency Unit - Ethiopian Birr (ETB) US$ 1.00 Birr 6.875 (As of January 20, 1998) SDR 1.00 - US$ 1.34159 WEIGHTS AND MEASURES 1 meter (m) - 3.28 feet (ft) 1 kilometer (km) - 0.62 mile (mi) 1 sq. kilometer (km2) - 0.386 square miles (sq mi) 1 hectare (ha) - 2.47 acres (ac) I metric ton (m ton) - 2,204 pounds (lbs) ABBREVIATIONS AND ACRONYMS CBE - Commercial Bank of Ethiopia DCA - Development Credit Agreement EELPA - Ethiopian Electric Light and Power Authority ERA - Ethiopian Roads Authority ERRP - Emergency Recovery and Reconstruction Project ESRF - Ethiopian Social Rehabilitation Fund ESRDF - Ethiopian Social Rehabilitation and Development Fund ETA - Ethiopian Telecommunications Authority EU - European Union FY Fiscal Year GDP - Gross Domestic Product IDA - International Development Association ISC - Inter-sectoral Committee MSC - Master Special Commitment NGO - Non-governmental Organization PMU - Project Monitoring Unit PROGRAM - Economic Recovery and Reconstruction Program SC - Steering Committee SDR - Special Drawing Rights TA - Technical Assistance TGE - Transitional Government of Ethiopia Vice President Mr. Callisto F. Madavo Country Director - Ethiopia Ms. Oey Astra Meesook Sector Manager Mr. Yusupha B. Crookes Task Manager Mr. John D. 1iverson FOR OFFICIAL USE ONLY IMPLEMENTATION COMPLETION REPORT ETHIOPIA EMERGENCY RECOVERY AND RECONSTRUCTION PROJECT (CREDIT 2351-ET) TABLE OF CONTENTS Page No. Preface ...................................................i Evaluation Summary .................................................. ii PART I: PROJECI IMPLEMENTATION ASSESSMENT Statement'Evaluation of Objectives ..................................................1I Achievement of Objectives ....................................................2 Implementation Record and Major Factors Affecting the Project ...........................3 Sustainability of the lProject ...................................................6 Bank Performance ...................................................7 Borrower Performance ...................................................7 Assessment of Outcome ...................................................8 Future Operations ...................................................8 Key Lessons Learned .................................................. 10 PART II: STATISTICAL TABLES Table 1: Summary of Assessments .................. ................................ 1 Table 2: Related Bank Loans/Credits .................................................. 12 Table 3: Project Timetable .................................................. 12 Table 4A: Credit Disbursements: Cumulative Estimated and ActuaL .. 13 Table 4B: Disbursements from PROGRAM ............................................. ..... 13 Table 5: Studies Included in the Project .................................................. 14 Table 6A: Project Costs .................................................. 15 Table 6B: Project Finanicing ...................................... 1 5 Table 6C: Cost and Financing of PROGRAM ................................................... 16 rable 7: Status of Legal Covenants .................................................. 17 Table 8: Compliance with Operational Manual Statement .................................... 19 Table 9: Bank Resources: Staff Inputs ........................... ....................... 20 'Fable 10: Bank Resources: Missions .................................................. 21 APPENDIX Map of Ethiopia 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. IMPLEMENTATION COMPLETION REPORT ETHIOPIA EMERGENCY RECOVERY AND RECONSTRUCTION PROJECT (CREDIT 2351-ET) PREFACE This is the Implernentation Completion Report (ICR) for the Emergency Recovery and Reconstruction Project (ERRP) in Ethiopia for which an IDA Credit in the amount of SDR 104.9 million (US$ 150 million equivalent) was approved on March 31, 1992 and made effective on July 7, 1992. The final disbursement took place on February 19, 1998 and the balance of approximately US$ 11 million will be canceled shortly. The ERRP is part of an Economic Recovery and Reconstruction Program ( PROGRAM) which is a program co-financed by the Transitional Government of Ethiopia, African Development Fund, European Economic Commission, European Investment Bank, Germany, Japan, the Netherlands, Sweden, United States Agency for International Development, United Nations Development Program, and reallocation from IDA's existing credits. The ICR was prepared by John Riverson, Task Team Leader, AFTT1, and reviewed by Yusupha Crookes, Sector Manager, AFTT1 and Oey Astra Meesook, Country Director for Ethiopia. Preparation of this ICR was initiated during the Bank's supervision mission of June 1997. It is based on a retrospective review prepared in 1995, and on materials in the project file. The Borrower contributed to preparation of the ICR by providing selected reports and information from its records. All project components except for the Roads component closed on September 30, 1995, six months after originally scheduled. The closure of the Project Management Unit shortly thereafter contributed to delay in submission of the Borrower's contribution to the ICR (which will be submitted separately), as well as submission of the final audit reports. The Roads component closed on September 30, 1997. ii EVALUATION SUMMARY Introduction 1. The ERRP was part of the multi-donor financed Economic Recovery and Reconstruction Program of Ethiopia, which was prepared to reverse the social and economic situation resulting from almost two decades of devastating civil war and economic mismanagement that the Transitional Government of Ethiopia (TGE) inherited when it came to power in May 1991. The ERRP was financed with a new credit from IDA (Credit 2351-ET) which was designed to cover the part of the PROGRAM for which no funds were available from the rest of the donor community and the ongoing IDA-funded projects. 2. At the time of appraisal, IDA and the participating donors estimated the needs of the PROGRAM at US$ 657.4 million. Having ascertained the intention of other donors to finance US$ 426.7 million and the availability of US$ 80.7 million from reallocations of existing seven IDA credits to finance some parts of the PROGRAM, IDA undertook to finance the residual of the PROGRAM by providing the TGE with a new credit anounting to SDR 104.9 million (US$ 150 million). IDA's overall contribution to the PROGRAM therefore amounted to US$ 230.7 million. 3. Apart from the 1985 Drought Recovery Program, the Bank had no similar prior involvement in the country. The ERRP was a one time effort to assist Ethiopia to embark quickly on a process of economic and social recovery. Project Objectives 4. The broad objectives of the project and the PROGRAM were to assist Ethiopia to jump- start its economic and social recovery and to lay the basis for the follow-up adjustment program. The specific objectives of the ERRP were to support: (i) reconstruction of roads, power, telecommunications, and civil aviation facilities as well as rehabilitation of social infrastructure at the community level, (ii) inputs for public industrial enterprises and construction materials; and (iii) road transportation and petroleum products. 5. The program and project objectives were fully accepted and implemented by all players. And the results achieved confirm the relevance of the project objectives to the country's economic and social development. Implementation Experience and Results 6. Although the Credit became effective on July 7, 1992, the implementation of the project started rnuch earlier. Some bidding documents were sent to IDA for review and approval as early as December 17, 1991. 7. By all accounts, the project has been successfully implemented. As of March 1, 1998, 92% of the proceeds of the credit was disbursed. The disbursement performance of the ERRP compares favorably with the average disbursement under IDA emergency projects for all regions. The ERRP got off to a good start with a percentage utilization of 16% at the end of the first four iii quarters (IDA average 14%) and accelerated faster to reach 73% at the end of eight quarters (IDA average 38%) and notched up to 89% at the end of twelve quarters (IDA average 66%). 8. The transportation of goods that were purchased under the PROGRAM from the ports to distribution centers was considered by the Bank and many donors to be beyond local capacity, hence, SDR 7,888,000 (US$ 12 million) was allocated for international transport contracts in case large-scale transport bottlenecks occurred. But the TGE made full use of existing domestic transport capacity, so that goods purchased under the project were successfully transported from ports to distribution centers without the use of international trucking capacity. The funds for international transport were eventually reallocated to purchase equipment and materials for the industrial sector. 9. The successful implementation of the PROGRAM is attributable to the strong commitment of both the TGE and the Bank in achieving the objectives of the project. The TGE implemented the PROGRAM through a cabinet-level Steering Committee chaired by the Prime Minister. Further, an Inter-Sectoral Committee of Vice Ministers and high officials of government departments and other agencies under the chairmanship of the General Manager of the Project Management Unit (PMU) functioned very effectively, meeting with unfailing regularity (weekly in the crucial phase) and addressed issues as they emerged. 10. The TGE also appointed one of the advisors of the President of the country to head the PMU, a person to whoml the TGE could become very accessible. The TGE also made relatively generous allocation of resources to the PMU while delegating full authority to its General Manager to organize and staff the PMU as he saw fit on salaries much higher than their counterparts in various ministries. This staff was drawn from every source including the private and the public sectors. it. The Bank's commitment was shown in many ways: (i) the project task manager was stationed in Addis Ababae to facilitate its implementation; (ii) measures were taken to speed up the procurement and disbursement processes and two seminars on IDA procurement and disbursement procedures were organized for project staff; (iii) when the Import Special Account could not cope with the payment pressures resulting from the intensive import activities, the Bank set up a Master Special Commitment (MSC) Account to speed up the disbursement process for the purchase of goods. The result was the reduction of delays in the import of urgently needed materials under the project; and (iv) recovery in agriculture, livestock, education, health, energy and water sectors was supported by restructuring ongoing IDA-funded projects. Summary of Findings, Future Operations, and Key Lessons Learned 12. The project outcome is very satisfactory and sustainable. The evidence shows that the Ethiopian economy has recovered significantly over the life of ERRP. According toFY 1997/98 Financial Program of the Federal Republic of Ethiopia, prepared by National Bank of Ethiopia, GDP at constant factor cost grew by 64% in the four years ending June 30, 1995. Although it is difficult to isolate the impact of ERRP and the PROGRAM, it can be concluded that the ERRP contributed considerably to the social and economic recovery of the country, and the results have been sustained. GDP at constant factor cost not only grew over the life of ERRP but continued to grow (by 10.6% and 5.60%6 in FY 1996 and FY 1997, respectively). Government has also taken new initiatives to sustain the progress in the production, social, and infrastructure sectors and to support further structural reforms leading the economy towards self-sustaining growth. iv 13. Key Lessons The fundamental lessons that can be drawn from the implementation of ERRP are; * Commitment and ownership of the borrower is critical for the successful implementation of such emergency recovery projects. * Delegation of authority to a dedicated and well-equipped PMU under a strong manager with proven record and motivated staff, coupled with an action oriented Inter-sectoral Committee also proved to be an effective administrative arrangement worth emulating in similar projects. * Staff of implementing agencies need to be trained early in procurement and disbursement procedures with periodic refresher courses during project implementation. * Bank and other donors commitment at preparation, appraisal, and implementation stages is essential for success. * Having the Bank Task Manager stationed in the country contributes to implementation success by ensuring close collaboration with implementing agencies, and effective donor- coordination. * Bank should be flexible and ready to review its procedures for procurement and disbursement to meet the needs for expedited implementation under such emergency operations. X Bank should provide sufficient resources for project supervision in order to ensure effective supervision of all sectoral operations used in the program. * Constant review of the liquidity problems of the borrowers and introduction of disbursement arrangements like the MSC where necessary, should be considered in future emergency recovery projects. * The smaller regravelling contracts of the roads component would have been better suited to domestic contractors or ERA force account units rather than ICB contracts. * As the first credit after a long period of war, allowance for some experimentation and learning can be beneficial for future operations. Although unintended, the contractual delays, arbitration proceedings and eventual amicable settlement in connection with the road regravelling contracts highlighted important areas to address in the design of follow up operations in the Road Sector. * In this context, the pilot activities carried out under the ESRF provided a basis for learning and laid the foundation for the effective follow up operations of the ESRDF. * Programs under the full control of communities are more likely to be sustainable. * An appreciation of the ground realities at the initial planning stage would have improved the performance of the delayed components. IMPLEMENTATION COMPLETION REPORT ETHIOPIA EMERGENCY RECOVERY AND RECONSTRUCTION PROJECT (CREDIT 2351-ET) PART I - PROJECT IMPLEMENTATION ASSESSMENT A. STATEMENT/EVALUATION OF OBJECTIVES Introduction 1. ERRP was an important part of IDA's flagship operation to assist the TGE, which came to power in May 1991, to jump start the Ethiopian economy and launch it on a path of recovery and reconstruction after two cdecades of devastating civil war and economic mismanagement. The TGE was faced with a massive social crisis with hundreds of thousands of displaced persons, refugees, demobilized soldiers, homeless, maimed and unemployed people needing assistance and rehabilitation. The ERRP and the overall multi-donor financed PROGRAM were designed in a very short time of three months for implementation in thirty months. Ten donors participated in the program and agreed on an agenda of some 25 different activities with a value of US$ 657.4 million. Although IDA's contribution to the program, including reallocations from existing credits was US$ 230.7 million, the IDA Credit that was designed to finance ERRP was US$ 150 million. Objectives 2. The objectives of the PROGRAM and the ERRP were to assist Ethiopia to embark quickly on a process of economic and social recovery and to lay the basis for the follow-up adjustment program. The specific objectives of ERRP were to support: (i) reconstruction of roads, power, telecommunications and civil aviation facilities, and rehabilitation of social infrastructure at the community level; (ii) inputs for public industrial enterprises and construction materials; and (iii) road transport and petroleum products. Assessment of Objectives 3. The objectives of ERRP and the PROGRAM were very clear. Having come to power in May 1991 after almost two decades of devastating civil war and gross economic mismanagement, the TGE inherited a social and economic situation that was close to crisis and worsening daily. To reverse this social and economic situation, the TGE prepared a multi-sectoral program of economic recovery and reconstruction and requested the Bank and the rest of the donor community for emergency assistance. The Bank agreed in principle on condition that this assistance would be a precursor to a program of adjustment and policy reform. 4. The ERRP was in accordance with the Bank's country assistance strategy. This strategy fell into two phases. The first: phase consisted of providing, along with other donors, the emergency assistance needed, and to recommence essential economic activity. The second phase consisted of the design of a program of structural reform whose implementation would begin in 1992. Consequently, the ERRP not only responded to the emergency economic and social situation in the 2 country but it was also designed to ensure that all of its components would be compatible with, and complement, the follow-up reform program. 5. As a large scale multi-sector operation, the ERRP and the PROGRAM were very demanding to implement. It is noteworthy that such a complex program was implemented in a country whose political and administrative systems were in transition and the social and economic infrastructure was dysfunctional. B. ACIIHEVEMENT OF OBJECTIVES 6. The contribution of the PROGRAM to the social and economic recovery of the country is difficult to isolate from other factors. However, what can be said is that since FY 1993, when the first impact of the PROGRAM/ERRP began to be felt in the economy, real GDP has grown at an annual rate of 6.4 percent in the three years ending FY 95. Over the program period (FY92-FY95) there has been significant fiscal consolidation and redirecting of public expenditures to the social sectors and infrastructure. Government revenues increased by about two and half times, while government expenditures doubled during this period. The budget deficit (excluding grants) declined from 9.6 percent of GDP in FY92 to 7.2 percent by FY 1995. During this period, inflation came down from 21 percent to 13.3 percent as well. On the external side, Ethiopia's exports increased over nine fold (albeit from a low base), while imports increased by three and a half times during the ERRP period in order to accommodate the pent-up demand for capital equipment and essential imports to begin rehabilitating the war-torn economy. The current account balance (excluding official transfers) was nevertheless kept in check, decreasing from 6 percent of GDP in FY92 to 4.4 percent of GDP by FY95. 7. The PROGRAM also played a significant part in restoring and enhancing industrial production, paving the way for large scale social rehabilitation and reconstruction programs, and rehabilitating the damaged physical infrastructure. The Ministry of Industry has estimated that the imports financed by the PROGRAM (with a contribution of SDR 34.2 million by IDA out of which 92% has been disbursed) helped to increase the capacity utilization in both the private and the public sector of industrial enterprises from 20% to 80%. Large and Medium Scale Manufacturing (the primary beneficiaries of IDA allocations in this sector) at constant factor cost grew from 306.1 million Birr in 1991/92 to 606.2 million Birr in 1995/96. 8. On the road regravelling works, the two overseas contractors completed 47% of the planned length of 767 km by the closing date of September 30, 1997. However, the Ethiopian Ethiopian Roads Authority (ERA) performed admirably on other regravelling completing 80% of the 436 km of road under Force Account by the closing date of September 1995. ERA demonstrated that it increased its capacity and performance after successfully acquiring the equipment it needed. This increased capacity of ERA also created good prospects for considerable and sustainable improvements in the road network. 9. The ERRP has contributed to the growth of output in electricity and water which at constant factor cost grew by 5.9%, 5.1 %, and 5.5% in 1992/93, 1993/94 and 1994/95, respectively. 10. All of the allocation from the proceeds from Credit 2351-ET to finance the importation of construction materials has been disbursed. The sale of these construction materials has helped repair and reconstruct about 60% of the damaged houses and buildings in the war ravaged areas. 3 11. All the foreign exchange allocation for civil aviation under the PROGRAM was obtained from Cr. 2351-ET. The newly acquired electric standby generators enhanced performance in those airports where there was no commercial electric supply. There was considerable improvement in airport lighting at Bole International Airport for safe landing at night or in bad weather. Reliable, safe and normal operations were restored following the reduction of flight delays and diversions, and the resultant orderly flow of traffic. 12. Rehabilitation of telecommunications facilities played a major role in normalizing the administrative and industrial sectors, especially in the northern parts of the country. It also helped to set up some new service centers in rural areas previously without any telecommunication service. Since the open-wire system was found costly in a hilly country with several hazards, the Digital Radio Multiple Access System (DRMAS) was used to provide telephone service to the destroyed towns and other rural areas. 13. The objective of Ethiopian Social Rehabilitation Fund (ESRF) was to rehabilitate persons displaced and unemployecl by the effects of war, drought, and economic stagnation into the Ethiopian society and economy. About 2.1 million people, the poorest and the most vulnerable, benefited from the ESRF: primary schooling for over 20,000 children; literacy and basic skill training for almost 390,000 adult illiterates and displaced persons; basic health services for 329,000 inhabitants. latrines for over 230,000 people and improved drainage for a further 75,000 people in the poorest sections in Addis Ababa; rehabilitating feeder roads linking poor communities to markets and other essential facilities benefiting over 780,000 villagers; measures to help the productivity of poor peasant farmers: irrigation and micro-dam storage for over 11,000, storage facilities benefiting 145,000, and conservation measures benefiting almost 44,000; and income generation schemes reaching almost 15,000 people belonging to vulnerable groups (destitute ex-soldiers, women heads of household, displaced civilians, poor peasants, and orphans). The provision of community water supply infrastructure has provided 67,000 inhabitants of poor households with safe alternatives to untreated water sources at an affordable price, and has helped reduce the burden to traditional women water carriers. The ESRF has confirmed the effectiveness of the social fund approach as a way of giving poor households and communities greater control over their economic and social advancement. 14. Other IDA assistance under the PROGRAM ($80.7 million) provided through restructuring of seven on-going projects mainly in the agriculture, education and health sectors made significant contribution by way of increased agricultural production, repair and rehabilitation of a large number of schools and health facilities in the rural areas, as well as strengthening the transport and energy sectors. C. IMPLEMENTATION RECORD AND MAJOR FACTORS AFFECTING THE PROJECT 15. The ERRP as well as the PROGRAM were scheduled to be implemented over a period of 30 months, to be completed by September 30, 1994 and closed on March 31, 1995. None of these expectations were, however, realized. In the event, the closing date of the Credit, except for the Roads Component, was extended from March 31, to September 30, 1995. The Roads Component was extended until September 30, 1997 to allow the completion of delayed regravelling contracts. Despite this extension, compared to the implementation of other IDA projects in Ethiopia and similar IDA projects elsewhere, the implementation of ERRP was found to be superior. By December 31, 1995, 91 % of the Credit proceeds had been disbursed (including amounts in Special Accounts). The disbursement performance of ERRP compares favorably with the average disbursement under IDA emergency projects for all r egions. The ERRP got off to a good start with a percentage utilization of 4 16% at the end of the first four quarters (IDA average 14%) and accelerated faster to reach 73% at the end of eight quarters (IDA average 38%) and notched up to 89% at the end of twelve quarters (IDA average 66%). 16. The Credit was made effective on July 7, 1992, but the procurement process started earlier. Bidding documents were sent to IDA for review and approval December 17, 1991, and 'No Objection Notices' were received for them on March 16, 1992. The early start of implementing the ERRP confirms that both the TGE and IDA were firmly committed to the speedy implementation of ERRP. 17. Whiile the procurement process on the whole proceeded smoothly, there were delays in some of the stages of the process. Of the 141 packages that were examined, only 47% of them could have their bidding documents approved by IDA within the norm of 30 days and only 35% of the bid evaluation reports of these packages could be submitted to IDA within the norm of 30 days. An analysis of undue delays showed that in the start-up phase, many implementing agencies took some time to familiarize themselves with IDA procedures and guidelines and there were frequent changes in personnel in the concerned implementing agencies. While training had been organized for them in the initial stages, it was not followed up through later stages. Given the frequent changes in staff in the implementing agency offices, it would have been appropriate to organize training sessions or refresher courses say once every six months. 18. The progress of disbursement in ERRP was faster than the average for similar IDA projects in all regions, however, some difficulties were experienced in some stages. Although the TGE had opened an Import Special Account, it found it difficult to open letters of credit in favor of suppliers for a large number of payments in a short span of time for the goods and services ordered. Consequently, IDA took the initiative to introduce a MSC for US$ 15 million resulting in timely disbursements and deliveries from several suppliers. 19. Although 92% of the allocation for the purchase of equipment and materials in the Roads Sector was used up, there were some problems in utilizing some of the allocations to this sector. Out of the allocation of US$ 0.42 million for the purchase of building materials for local suppliers, ERA could use only US$ 14,000. ERA believed that the prices quoted were too high, but the Bank did not agree to ERA's request to re tender the purchase. 20. ERA was also unable to make full use of the US$ 1.42 million allocation for the rehabilitation of road maintenance equipment since it could not recommend any of the bidders for the work. All the quoted prices were considered to be too high. Since it was difficult for the bidders to estimate the cost of rehabilitating the equipment before dismantling it, there was a tendency on the part of the bidders to take the maximum possible cost they could incur as a basis for their quotation. The price quotations were also not regulated by competition since all the bidders were sole agents for the specialized equipment they were to rehabilitate. Consequently, ERA discussed with IDA to be allowed tc use the US$ 1.42 million to buy spare parts and tools so that it could rehabilitate the maintenance equipment in its own shop, a proposal which got acceptance and was implemented in FY 1997. 21. The technical assistance component was successful in setting up procedures for contracts administration in ERA which became the basis for ERA's institutional development and strengthening under the Government's 10-year Road Sector Development Program. The regravelling contracts, however, did not achieve their targets. While ERA was able to re-gravel 80% of 436 km of road under Force Account, during the program period, the 767 km of regravelling works contracted 5 out to two overseas contractors were terminated after 47% of the planned length was re-graveled at a cost of 67% of the original total value of all four contracts. The following factors accounted for this result: (i) increase in quantities resulting from deterioration after the mobilization delays, and increase in the final approved regravelled road widths; (ii) the contractors' failure to mobilize equipment as agreed; they employed insufficient or incompetent site agents and did not observe the procedures for identifying borrow pits; and the consultant failed to advise ERA in time to impose sanctions against defaulting contractors; (iii) the consultants effected too many changes in their project engineering staff and delayed approval of borrow pits and materials; (iv) there were delays in customs clearance and in clearing land mines in advance of construction activities; and (v) ERA failed to appoint site engineers and could not adequately supervise the site work with the result that ERA realized rather late that the contractors as well as the consulting engineers were not doing their jobs on time; (vi) the disproportionate costs of mobilizing and demobilizing international contractors for what in some cases - particularly Contract 4 - were rather minor works would have better suited domestic contractors or ERA force account execution. 22. The transportation of goods that were to be purchased under the PROGRAM from the ports to distribution centers was considered by the Bank and the other donors to be beyond the domestic transport capacity, hence, :SDR 7,888,000 (US$ 12 million) was allocated for international transport contracts in case large-scale transport bottlenecks were to develop. However, the TGE made full use of the existing transport capacity in the country and the anticipated risk never materialized. The TGE also moved quickly to substantially liberalize the transport sector by removing all restrictive controls and by facilitating the import of trucks, spares and tires. The National Logistics Committee under the chairmanship of the Vice Minister of Transport and Communications was created so that the truck fleet available in the country could be fully mobilized to meet the challenges of moving large quantities of imported material from the ports to distribution centers. Through careful planning and effective monitoring, this Committee facilitated port operations, customs clearances, and inland transportation. Consequenitly, what was allocated for international transport contracts was reallocated to the Industrial Sector which made full use of it. 23. A great deal of work was done by the ESRF Management Unit including the preparation of an operational manual describing the procedures to be followed at all stages of the project cycle in managing community-based projects. The ESRF was launched through a promotional campaign to inform communities about the Fund's facilities and procedures. It identified community needs, and provided basic training in identifying and submitting sub-project proposals. The Fund encouraged management by community committees, and fostered linkages between communities and local support groups, local government officials, community facilitators, NGOs, and private contractors. Within a general sub-project limit of US$ 250,000, the Fund focused on support for the rehabilitation or building of basic healthi facilities, primary schools, micro dams, feeder-roads, water supply and sanitation facilities; programs in adult skills development and literacy training; and support for income generating ventures carried out by small groups, often consisting of women. 24. The ESRF was flooded with proposals: as of December 31, 1995, the total number of proposals it received were 1,026, out of which 462 were accepted for appraisal. Of those appraised, sixty seven proposals were returned to applicants for reformulation, 170 failed to meet ESRF appraisal standards and 225 were approved for financing. Six were later canceled due to legal requirements and poor performance of implementing agencies. In the end, 219 sub-projects were completed under the ESRF by December 31, 1995. The other 564 proposals came from mainly non- pilot regions for which there was only limited allocation from the fund. They were therefore kept in 6 the pipeline for consideration under the follow-up ESRDF program, for which an IDA credit of US$120 million was approved in 1996. 25. One of the most important reasons for the success of ESRF was the responsiveness of the staff of the Fund to community needs. However, the ESRF's thin structure was often stretched to its limits and ilts work schedule delayed. Sometimes the staff of the Fund had to provide extensive assistance to bring community proposals to an acceptable level for consideration. In many rural areas there was a shortage of local contractors with the financial resources to purchase construction materials and facilities to transport materials to remote sites. ESRF could often purchase construction materials more cheaply from central stocks and transport it more efficiently using its own facilities. In such cases, ESRF took on procurement responsibility leaving the local project committees to deal with labor contracts. The formula worked effectively but produced a heavy work load for the Fund. This problern was solved through a comprehensive capacity building program to (i) prepare the Fund for its expanded role; (ii) respond to the weaknesses among the staff of the bureaus, NGOs, local contractors; and (iii) provide communities with skills to manage their own initiatives by training community project committees, and strengthen links between communities and local facilitating groups. D. SUSTAINABILITY OF THE PROJECT 26. The ERRP was designed to be sustained in the follow-up adjustment program. The Adjustment program is still under implementation, and is likely to be expanded in the foreseeable future. It is therefore expected that the results of ERRP will continue to be sustained. In addition, the continued growth of the economy as a whole and all the specific sectors in which the ERRP participated, further indicates that the economic recovery and, more specifically, the achievements of ERRP are being sustained. 27. The results of the ERRP have also confirmed its sustainability. The PROGRAM has been followed by an economy that has been growing. GDP at constant factor cost not only grew over the life of ERRJP (by 12%, 1.7%, and 5.4% in 1992/93, 1993/94, and 1994/95, respectively) but has also been growing since then (by 10.6%, and 5.6% in 1995/96 and 1996/97, respectively), and is projected to grow by 2.8% in 1997/98, despite a serious shortfall in agricultural production due mainly to drought. ERRP has therefore succeeded in helping Ethiopia to embark quickly on a process of sustained economic and social recovery. Furthermore, the ERRP objectives are being continued in the follow-uLp adjustment program. 28. All the sectors of the economy that the PROGRAM participated in have all been growing after its implementation. Large and medium scale manufacturing at constant factor cost grew by 7.8% and 5.7% in 1995/96 and 1996/97, respectively and is projected to grow by 10.4% in 1997/98. The Transportation and Communications Sector grew by 9.5% and 10.7% in 1995/96 and 1996/97, respectively, and is also projected to grow by 9.2% in 1997/98. The output of electricity and water at constant factor cost declined by 5.9% in 1995/96 and grew by 13.5% in 1996/97 and is projected to grow by 6.6% in 1997/98. The agricultural sector which is the primary engine of economic growth in Ethiopia also registered remarkable progress; it grew at 5.8 percent per annum during FY1993-96. ERRP contributed to its growth through policy reform by opened up fertilizer imports under restructured PADEP I. Fertilizer consumption increased from about 100,000 tons in FY1991 to over 260,000 tons in FY1996, and foodgrain production rose from an average of 6 million tons in the eighties to a record of over 10 million tons in FY1996 due to the increase in fertilizer use, good 7 weather and some increase in cropped area. Such rates of growth in these sectors indicate that the contributions made by the ERRP and the PROGRAM are being sustained. 29. That the ESRF has developed into the ESRDF from a fund of US$ 15.1 million to US$ 242 million and has expanded its operations to cover all regions of the country testifies that the achievements of ESRF have also been sustained. For example, the assistance contributed to completing sub-projects in water supply, urban sanitation, irrigation and income generation, and communities have contracted responsibility for maintenance and are meeting recurrent costs. Community Project Committees established under the Credit have continued to manage the operation and maintenance of the assets of the sub-projects. The ESRDF is designed to provide the poor (especially women) in mainly rural communities with the assets and services needed to improve their economic and social standards. The ESRDF includes: (i) direct borrower and beneficiary participation focusing on utilizing community and private initiatives supporting community-generated and implemented micro-projects to improve essential infrastructure and income generation; (ii) a large rural water supply component; and (iii) a capacity building component to improve the quality of social service delivery in the regions and strengthen their capacity for community investment, maintenance and management. These programs give special attention to economically disadvantaged communities and economically marginalized regions. E. BANK PERFORMANCE 30. The role of the Bank was critical for the successful implementation of the project. The Bank led the preparation and appraisal of ERRP and made a significant financial contribution to the PROGRAM. The Bank stationed the project task manager in Addis Ababa to facilitate its implementation and ensure effective donor coordination, and took measures to speed up the procurement and disbursement processes. The Bank also organized two seminars on IDA procedures for procurement and disbursement for the personnel who were involved in implementing the project. These successful measures were sometimes offset by the paucity of supervision resources to cover all sectoral components. As a result, some sectoral task managers could not visit Ethiopia with the expected regularity. The Bank sent a procurement specialist on an ERRP supervision mission in September, 1992, when the procurement activities were at their peak, to assist the implementing agencies to prepare documents acceptable to IDA. This support contributed to reduction in processing time. F. BORROWER PERFORMANCE 31. The ERRP and the PROGRAM were prepared by the TGE in only three months. That such multi-donor financed and mu]ti-sectoral program could be prepared in such a short time is in itself an indication that the TGE was committed to having the ERRP designed and implemented successfully. Moreover, considering that Ethiopia had a poor record in utilizing IDA assistance (in the 11 projects approved between 1986 and 1990, only 17% of the credit proceeds were utilized), it was unrealistic to expect the ERRP to be implemented within 30 months. But through its commitment, ownership, effective management and mobilization, the TGE dispelled whatever doubts there was about its capacity for speedy implementation when 73% of the proceeds of Cr. 2351-ET was utilized in the first two years of the project. 32. TGE implemented the project through a cabinet-level Steering Committee (SC) chaired by the Prime Minister. In ad[dition, the TGE created an Inter-sectoral Committee of the Vice Ministers of the Implementing Ministries and high officials of government departments and other agencies, 8 chaired by the General Manager of the PMU (with well paid, highly qualified and committed staff), as well as a National Logistics Coordinating Committee as a standing committee chaired by the Vice Minister of Transport and Communications. The Committees functioned most effectively with unfailing regularity (weekly, in the crucial phase), and addressed all the 'nuts and bolts' issues as they emerged. TGE's commitment to the successful implementation of the project was further reflected in its relatively generous allocation of resources to the PMU and the delegation of full authority to its General Manager to organize and staff the PMU. G. ASSESSMENT OF OUTCOME 33. Overall, the project has achieved its objectives very satisfactorily and these achievements have been sustainable. The economy has substantially recovered - in the four years ending 1994/95, GDP at constant factor cost grew by 64%, and all the sectors in which ERRP participated have been growing. Furthermore, not only was the basis for the adjustment program laid, but the program has been in operation for more than four years. 34. The importation of goods financed from the proceeds of Credit 235.1-ET has assisted the Borrower to rehabilitate, reconstruct, maintain, and operate priority sectors of its economy damaged by civil war. In the Social Sector, the ESRF has succeeded to rehabilitate about 2.1 million of the poorest and the most vulnerable population. The expansion of the pilot ESRF into ESRDF covering all regions indicates that the achievements of ESRF are being sustained. 35. The inclusion of the road regravelling work by contract in this short-term emergency project without any preparatory activities was not sound. In hindsight, the implementation problems have highlighted the high risks and potential delays likely to occur in executing road rehabilitation works by contract in a country affected by civil war and with inadequate contract administration and supervision capacity. A separate road project would have been in order. All the civil works contracts experienced implementation delays, primarily due to GOE's limited exposure to international contracting. H. FUTURE OPERATIONS 36. While the ERRP was a one time effort to jump start the Ethiopian economy, future operations and policy actions were designed and formulated to contribute to the self-sustaining growth of the econoimy. Some initiatives have been taken by the government together with new projects to sustain the progress in the production, social and infrastructure sectors, and to support further structural reforms leading the economy towards self-sustaining growth. 36. Agreement was reached between the TGE and IDA in 1995 on a "National Fertilizer Sector Project" worth US$ 234.4 million with IDA's contribution of US$ 120.0 million for building up a dynamtic and competitive fertilizer sub-sector to accelerate increases in agricultural production and productivity. The fertilizer sector project is complemented by a US$ 22 million seed systems development project supported by IDA. The latter also provides for technical assistance, human resource development, and capacity building, and development of the informal seed sector. 37. In addition to developing the fertilizer and seeds sub-sectors, the TGE recognized the importance of strengthening agricultural research and training programs in the context of a decentralized structure where the regional governments are taking major responsibilities. Moreover, agricultural development needs to be environmentally sustainable. Land degradation caused by 9 inappropriate deforestation, soil erosion, and overgrazing stands out as a severe environmental problem in Ethiopia today. TGE has worked with the Bank to complete the Forestry Action Plan which together with the National Conservation Strategy have fulfilled IDA's requirements for a National Environmental Action Plan. 38. Since Ethiopia's industry is largely dependent upon imported raw materials, its capacity utilization depends upon adequate availability of foreign exchange resources. In 1993, IDA assisted Ethiopia with a Structural Adjustment Credit (Cr. 2560-ET) of US$ 250 million. Further, TGE, assisted by IMF and IDA worked out a comprehensive economic reforms program to help in fostering a healthy industrial sector. The elements in this policy dialogue included reducing regulatory and legal constraints to private investment, reducing the level and dispersal of import duties, enforcing policies to form contestable markets so that implicit entry barrier to private investment are removed, strengthening the financial sector to better mobilize savings and promote investment, designing a phased program to restructure and privatize public enterprises, and ensuring that those remaining in the public sector operate on a commercial basis. 39. The Government and the Bank have also agreed on a program of social sector studies within the overall framework of the recently developed national policies for health, women, education, and population. The studies cover three themes: a baseline multi-sector household survey for collecting essential data on incomre, expenditure, and needs at the household level, cost effectiveness and financing of health, education and family planning, and NGOs. Those studies are expected to help identify the types of interventions to have rapid and lasting impact on improving access to essential services for the poor, renmoving the constraints on the economic participation of women, and reducing Ethiopia's population growth rate. 40. IDA and the Government have agreed on a program of IDA's assistance which would include (i) a health sector investment program; (ii) an education sector investment program; and (iii) an agricultural research and training project. While all will be addressing urgent problems of social services of the poor, each has its own priorities. 41. Given that Ethiopia has one of the lowest road densities in Africa, IDA and EU assisted the Government to prepare a 10-year Road Sector Development Program complemented by a Transport Sector Memorandum prepared by IDA. Meanwhile, a US$ 96 million road rehabilitation project was approved by IDA in 1993 and a new Credit SDR 224.50 million (US$ 309.2 million) was signed on January 25, 1998 for an [DA financed Road Sector Development Program Support Project. 42. As part of the Economic and Sector Review, the Bank's Energy Sector Assessment Program has worked with the Government on the Energy Sector Assessment to provide options and strategies for energy development in Ethiopia. A new Credit for SDR 146.1 million (US$ 200 million) was signed for the Energy II Project on January 25, 1998. 43. In order to deepen structural reforms and to lead the economy towards sustainable growth, a number of initiatives are noteworthy. These include regular public expenditure reviews; a private sector assessment (the "Business Development Plan") which focuses on small and micro enterprises and recommends strategies to encourage private investment, as well as a regular Government - IMF - IDA dialogue on the policy reforms through policy framework papers. In this context, the first annual Enhanced Structural Adjustment Framework (ESAF) arrangement with the IMF has elapsed in October 1997, and the negotiations for the second annual ESAF are ongoing. 10 I. KEY LESSONS LEARNED 44. The most important lesson that could be drawn from the successful implementation of ERRP is that the high-level of commitment of both the TGE and the Bank were critical to the project's success. Other lessons are summarized below. 45. Government's willingness to delegate full authority for management and implementation to a dedicated, well-equipped and resourced PMU under a strong manager with proven record, integrity and respect from all levels coupled with the action oriented Inter-sectoral Committee also proved to be an effective administrative arrangement worth emulating in similar projects. The PMU hired maturated professionals at market based salaries. 46. Staff of implementing agencies also need to be trained early in procurement and disbursement procedures with periodic refresher courses during project implementation to maintain the level of efficiency and effectiveness in the face of possible staff turnovers. 47. Constant review of the liquidity problems of the borrower and introduction of arrangements, such as the Master Special Commitment (MSC) where necessary, to speed up procurement disbursemernt activities should be considered by IDA in future emergency recovery projects. 48. There were also lessons from implementing the ESRF. The overloading of the sanctioned staff of the Fund and the delays in processing and approval project requests suggest that greater use of competent part-time consultants could have helped to process applications faster, particularly where technical examination of construction and small industry components were involved. The inclusion of at least one woman on the project executive staff could also have brought gender issues into focus and for them to be adequately addressed. There were delays in the implementation of income generating projects while the standard of many income-generating proposals received were too low for consideration, highlighting the need for ESRDF to expand research and training in this area. The heavy work-load generated by the banking aspects of income generating operations, brought out the need for Government to support the development of savings and credit intermediary organizations and village banks at the community level. Programs under the full control of communities have a better prospect for sustainability; communities will cooperate fully if they are allowed to define their needs and priorities. 49. The implementation problems of the road regravelling work by contract highlighted the high risks and potential delays likely to occur in executing road rehabilitation works by international contract in a country affected by civil war and with inadequate contract administration and supervision capacity. A separate road project would have been in order. But the delays experienced from GOE's limited exposure to international contracting at the time, and in particular, its late recognition of the need to re-establish contract administration capacity in ERA as well as resolve contractual issues on time, highlighted critical areas that were addressed under the follow-on Road Sector Development Program. 50. The Bank's flexible approach in reviewing its procedures for procurement and disbursement so as to meet the needs for expedited implementation required for such emergency operations, is important for achieving results. 11 PART II - STATISTICAL TABLES TABLE 1: SUMMARY OF ASSESSMENTS A. Achievement of objectives Substantial Partial Negligible Not applicable Macro policies X Sector policies X Financial objectives X Institutional development X Physical objectives X Poverty reduction X Gender issues X Other social objectives X Environmental objectives X Public sector management X Private sector development X Other (specify) B. Project sustainability Likely Unlikely Uncertain x C. Bank performurnce Highly satisfactory Satisfactory Deficient Identification XI Preparation assistance X Appraisal X Supervision X D. Borrower performance Highly satisfactory Satisfactory Deficient Preparation X Implementation X Covenant compliance X Operation (if applicable) X E. Assessment of Highly Satisfactory Unsatisfactory Highly outcome satisfactory unsatisfactory x I Mainly because of the arrangements and period for implementation of components such as the Roads. 12 TABLE 2: RELATED BANK CREDITS CREDITTITLE PURPOSE YEAR OF APPROVAL STATUS PRECEDING OPERATION: DROUGHT RECOVERY 1985 CLOSED FOLLOWING OPERATION: ETHIOPIAN SOCIAL 1996 ONGOING REHABILITATION AND DEVELOPMENT FUND I TABLE 3: PROJECT TIMETABLE Steps in project cycle Date planned Date actual Identification N.A Preparation N.A August 1991 Appraisal N.A November 2, 1991 Negotiations N.A January 28, 1992 Board presentation N.A March 31, 1992 Signing N.A April 24, 1992 Effectiveness April 30, 1992 July 7, 1992 Project completion September 30, 1994 September 30, 1997 Loan closing March 31, 1995 September 30, 1997 N.A = not available 13 TABLE 4A: CREDIT DISBURSEMENTS: CUMULATIVE ESTIMATED AND ACTUAL (US$ million) IDA Year FY 92 FY 93 FY 94 FY 95 FY 96 FY 97 FY 98 Appraisal estimate 2.0 78.0 141.0 150.0 Actual - 22.6 103.6 126.6 138.1 140.8 138.01 Actual as % of estimate - 29.0 73.5 84.4 92.1 93.9 92.0 Date of final disbursement - - 2/19/98 1. Cumulative disbursements in FY98 actually went up to US$142.05 million, before an amount of US$4.05 million was refunded from the Special Account. TABLE 4B: PROGRAM DISBURSEMENTS (US$ million) FINANCIER 1992/93 1993194 1994/95 1995/96 1996197 1997198 TOTAL IDA: 66.01 97.05 34.06 11.50 2.70 -2.80 208.52 Cr. 2351-ET 22.6C 81.00 23.00 11.50 2.70 -2.80 138.00 Reallocated 43.41 16.05 11.06 0.00 0.00 0.00 70.52 ADB 19.55 58.66 25.37 14.8 3.08 0.18 121.64 EEC** 48.82 35.82 25.80 6.22 116.66 DANIDA 0.00 1.00 0.00 0.34 0.00 0.00 1.34 SIDA 0.00 2.32 0.18 1.68 0.00 0.00 4.18 GERMANY** 0.00 7.50 0.00 0.00 7.50 USAID* 7.71 46.11 6.07 0.00 59.89 EIB* 0.00 5.06 0.45 2.97 8.48 NETHERLANDS 2.20 0.00 0.60 0.00 2.80 TOTAL 144.29 253.52 92.53 37.51 5.78 -2.62 531.01 **Disbursement information available only through FY95 (June 30, 1995). 14 TABLE 5: STUDiES INCLUDED IN THE PROJECT Study Purpose Status hnpact 1. ERA Contract To identify needs of Contact Recommendations Basis for the re- Management management in ERA and of the study are establishment of propose institutional setup and being contract system. implemented Administration under RSDP. Division in ERA. 2. ERA Force To set up a resources planning Recommendations Maintenance resource Account Maintenance system. of the study are planning improved in being ERA. implemented by ERA. 15 TABLE 6A: PROJECT COSTS Appraisal estimate ( US$ M) Actual (US$ M) Item Local Foreign Total Local Foreign Total Costs Costs Costs Costs Industry: Public 40 40 44.8 44.8 Construction Materials - 7 7 6.6 6.6 Social Rehabilitation Fund 10.1 5 15.1 4.8 Equip. and Materials for Transport Sector 2 9 11 N.A 7.6 Transport Contract 1.4 12 13.4 l Petroleum Products - 20 20 19.4 19.4 Assistance to ERA 1.2 23.6 24.8 N.A 20.6 Civil Works 5.1 20.3 25.4 N.A 10.7 Rehab. of Maint. Equipment 0.6 1.3 1.9 0.8 0.8 TA to ERA - 4.2 4.2 - 3.2 3.2 Power Reconstruction 2.5 3 5.5 N.A 2.8 Telecom Reconstruction 1.4 4 5.4 N.A 2.4 Special Acct. Disbursement - - - 13.1 - PPF - 0.6 0.6 0.7 0.7 TOTAL PROJECT COST 24.3 150 174.3 N.A 138.0* N.A *Numbers may not add due to errors in rounding. TABLE 6B: PROJECT FINANCING Appraisal estimate (US$ M) Actual (US$ M) Item Local Foreign Total Local Foreign Total Costs Costs Costs Costs IDA 150 150 138.0 138.0 Domestic Contribution 24.3 - 24.3 N.A N.A TOTAL 24.3 150 174.3 N.A N.A 16 TABLE 6C: COST AND FINANCING OF ECONOMIC RECOVERY AND RECONSTRUCTION PROGRAM as of March 3,1992 (in US$ million) COST FINANCING-- 43 Production Fertilizer 80.7 10.1 90.8 30.0 15.0 20.4 14.3 1.0 86.7 (from Cr. 1956-ET) State Farms Spares 3.1 3.1 1.6 3.1 Transport 3.4 SA Coffeerrea Exporters 11.6 3.4 1-1.6 Ministries 11.6 11.6 PADEP VI Roads 4.6 4.6 4.6 Seeds .6 9.4 6.6 -2.2 .8.8 Pesticides 8.7 3. 0.6 4.2 8.7 Vet, Drugs 0.3 11.6 -5.0 1.2 5.3 ItEi (from Cr. 1782-ET) Ag. Equipment 14.5 14.5 14.2 0.3 14.5 Industry: Public 87 0 87 0 40 0 12 3 20 2 9 0 5 5 87.0 Industry: Phvate 41.5 116-.0 18 0 6.0 '41.5 Construction Materials 7.0 7.0 7.0 i --7.0 SUB-TOTAL 282.4 11.0 293.4 47.0 35.0 37. 75.9 5.5 2.8 5.5 0.0 0.6 282.4 Social Edue: Reconstruction 25.7 15.0 10.0 0.7 25.7 (fmm Cr. 1873-ET) Health: Drugs/Supplies 37.8 0.9 17.5_ ___ ________37.8 (from Cr. 1913-ET) I -- - - ReconsttEquipment 11.7 11.7 0.5 11.2 11.7 Social Rehab. Fund 5.0 10.1 15.1 5.0 5.6 n 29.1 29.1 Structural Food Aid 1 1,C7 .4 CW 2.8 o.6 o.6 -6.6 -109.3 SUB-TOTAL 109.3 21.8 131. 5. 0 22 5 34.7 15.6 3 transport Civil Aviation 2.0 7.0 .0 iiaitwa-ys Spares 3.0 3 0 1.0 3.0 (from Cr. 2002-ET) TA 1.5 1.5 1.0 0.5 -1.5 (from dr. 2002-ET) Trucks New 26.3 26.3 7.5 2. 11.2 5.3 26.3 36.2 7.5 S6. 2 Spames 36 2 22.3.-6.4 --- Tires 7.0 7.0 7.0 7.0 Transport Contract 12.0 1.4 13.4 12.0 12.0 Petroleum Products 20 0 20.0 20.0 20.0 b uses -1.0 Spares 3.0 3.0 Port Roadi 0.7 0.7 0.7 0.7 -si --ce- ---3- 2- ff 18 As iiian to ERA -31 -2 6 3.6 35.1 Civil Works -20.3 5.1 --25.4 210.3. kejaE of Maint. Equip. 1.3 0.7 1.3 1.3 Water S_ 4.2 4.2 4.2 4. 2 y .7 4.8 18.5 5.2 0.4 8.1 Afrm Cr. 2103-E_ Power Reconstruction 11.0 2.5 13.5 8.0 11.0 (frc;m Cr 1704-ET) Telecom. Reconstructioii 11.0 1.4 12.4 4.0 7.0 -11.0 Refinancing of EEDPAC PPF 0.6 0.6 0.6 0.6 PiAUtechni- -1 0- to 9B.0 Z 322 .5.6 .9- 21.4 5.3 8.1 0.0 0.0 7.0 SLIB-11WAL -21 3.9 9.1 23S.0 1.0 213.9 5. 7.0 -1-.6 05.6 1.9 657.5 50.0 80.7 87.0 16.4 126.0 10.8 of which Phlis-Fail-ContiNency 1 8-3- ---2.61 26.8 - - Pdoe Contin ency 25.4 2.41-- V .8 T -- 1/ Including US$27 million Agricultural Commodity Aid (Wneat and Coffon) under PL480 (Title 111) TABLE 7: STATUS OF LEGAL COVENANTS Agreement Section Covenant Present Original Revised Description of Covenant Comments Type Status Fulfill Fulfill Date Date DCA 5.01(b) 12 C Prior to effectiveness of The Borrower to (i) facilitate, the transportation the credit inland by road transport of cargo imported to Ethiopia through the Port of Djibouti; (ii) permit the licensing of private domestic and foreign freight forwarding and clearing agents to operate in Ethiopia and facilitate at the Port of Assab; and (iii) allow public sector companies and agencies to empploy foreign forwarding and clearing agents of their choice. DCA 3.07(a)(i) 13 C Prior to Disbursement of The Borrower to (i) establish a Social Rehabilitation the Social Rehabilitation Fund for the purpose of financing community-based Fund social and economic sub-projects; DCA 3.08 3 C Prior to Disbursement of (ii) deposit Birr 20.7 million into the Social the Social Rehabilitation Rehabilitation Fund; and Fund DCA 3.07(A)(i) 3 C Prior to Disbursement of (iii) submit terms and conditions and eligibility the Social Rehabilitation criteria satisfactory to IDA for financing sub- Fund projects under the Social Rehabilitation Fund. DCA 3.12 12 C December 31, 1992 Borrower to (i) eliminate, not later than December 31, 1992, all road freight tariff regulations; and DCA 3.09 13 C (ii) based on IDA's review of transport capacity, take all necessary action, including the hiring of an international transport firm, to ensure that goods financed under ERRP are transported efficiently from the ports to the distribution centers inland. DCA 3.10 11 C May 3, 1992 Borrower to (i) issue directives allowing the CBE to participate in providing credit for the purchase of fertilizers, not later than May 31, 1992; and (ii) issue directives permitting the private retailing of fertilizer not later than May 31, 1992. DCA 3.11 11 C (iii) implement measures satisfactory to IDA to ensure that building materials, tires and spare parts for buses are sold to end users in the private sector. DCA 3.07(a)(ii) 5 C Borrower to maintain the Social Rehabilitation Fund Management Unit under the PMU, and the full-time head of the Unit to have qualifications and experience satisfactory to IDA. DCA 3.03 5 C Borrower to (i) maintain, until completion of the project, a cabinet-level Steering Committee chaired by the Prime Minister; Agreement Section Covenant Present Original Revised Description of Covenant Comments Type Status Fulfill Fulfill Date Date DCA 3.04(a) 5 C (ii) maintain, until completion of the Project, a project Monitoring Unit, including a unit manager, one representative from the private sector, the manager of the Social Rehabilitation Fund, a port and shipping advisor, and an inland transport advisor DCA 3.04(b)(iv 5 C (iii) prepare quarterly progress reports of the )__________ project; DCA 3.06(a) 5 C November 30, 1992 (iv) together with IDA and other donors, carryout a Mid Term Review of he project not later than November 30, 1992; and DCA 4.01 1 CD (v) appoint external auditors, acceptable to IDA to The required certified copies of audit reports audit all project account and present such audit for 1993, 1994, and 1995 fiscal year have reports to IDA within 6 months after the end of the been furnished to IDA but not on time. Since financial year. ERRP was presumed to have been closed on September 30, 1995, there could not be audits after this date DCA 3.01(b) 3 C Borrower to re lend from the proceeds of the Credit SDR 2,100,000 to EELPA and SDR 2,800,000 to ERA, at an interest rate of 7.75% p.a. repayment over 20 years, including five years of grace and the foreign exchange risk to be borne by EELPA and ETA. .- 19 TABLE 8: COMPLIANCE WITH OPERATIONAL STATEMENTS No significant lack of compliance with an applicable Bank Operation Manual. 20 TABLE 9: BANK RESOURCES: STAFF INPUTS Stage of Proiect Cycle Planned Planned Revised Revised Actual Actual Weeks US$ Weeks US$ Weeks US$ Preparation to appraisal NA NA NA NA 29.0 91,400 Appraisal NA NA NA NA 56.8 175,200 Negotiations through Board NA NA NA NA 23.8 74,400 Supervision NA NA NA NA 270.0 722,800 Completion 23.0 60,900 6.8 19,600 3.7' 13,400 TOTAL 383.3 1,077,200 As of 2/28/98 21 TABLE 10: BANK RESOURCES: MISSIONS Stage of Month/year Number of Days Specialized Staff Skills' Perform- Project Cycle Persons in ance l____ _____ _____Field Ratin & Identification 9/91 n/a 10 n/a Preparation -- Preappraisal -- Appraisal 11/91 16' 17 STM(A)4, HE, IS(2), INS, HRS(3), CO, FA, SE, TE, SPE, PS, OA, LEG Post-appraisal 2/92 1 14 Telecoms Engineer Supervision': 1. 4/92 15 10 STM(A), HE, IS, HRS(3), CO, TE, SPE, INS, OA, DO, DA, RMS(2) 2. 9/92 6 21 STM(A), HE, DO, DA, RPS, l ____________ ___________ __________ _____ PS, C onsultant 3. 10/92 1 13 INS 4. 10/92 2 14 HRS (2) 5. 11/92 3 4 SPE, OA, BA 6. 12/92 2 11 TE, FA 7. 4/93 2 7 SPE, OA 8. 7/93 1 20 DA 9. 9/93 1 10 TE 10. 9/93 1 4 INS 11. 10/93 1 2 INS 12. 11/93 1 4 INS STM(A)=Sector Task Manager (Agriculture); IS=Infrastructure Specialist; HRS=Human Resource Specialist; INS=lndustry Specialist; HE=Highway Engineer; CO=Country Officer; FA=Financial Analyst; SE=Senior Economist; TE=Transport Economist; SPE=Senior Power Engineer; (R)PS=(Regional) Procurement Specialist; LEG=Legal Counsel; DO=Disbursement Officer; DA=Disbursement Analyst; OO=Operations Officer; OA=Operations Analyst; BA=Budget Analyst; RMS=Resident Mission (Local) Staff 2No Performance Ratings are available; only one Form 590 was prepared. 3 Plus 3 officials from USAID, I from SIDA, I from EC and 1 from Netherlands 4 Sector Task Manager (Agriculture) was also overall Project Task Manager. 5Missions shown are supervision missions from headquarters. The project was supervised on an ongoing basis from the Resident Mission in Addis Ababa, where the task manager was based for much of the project life. 22 Stage of Month/year Number of Days Specialized Staff Skills6 Perform Project Cycle Persons in ance ___________ __________ ______ _ Field Rating7 14. 6/94 2 18 HE, Cons. 15. 9/94 1 7 INS 16. 10/94 1 7 PS _ 17. 2/95 1 7 HE 18 3/95 1 7 HE 19. 7/95 5 18 STM(A), I&M, PS, RMS(2) 20. 2/96 1 7 HE 21. 6/96 3 7 HE (2), PS 22. 10/96 3 7 HE (2), OO 23. 3/97 3 7 HE(2), OO ICR ______r 1I 6/97 3 4 HE (2), OO 2. 9/97 3 2 HE (2),O _____ 3. 2/98 3 2 HE (2), OO 6AS=Agriculture Specialist; IS=Infrastructure Specialist; HRS=Human Resource Specialist; INS=lndustry Specialist; HE=Highway Engineer; CO=Country Officer; FA=Financial Analyst; SE=Senior Economist; TE=Transport Economist; SPE=Senior Power Engineer; (R)PS=(Regional) Procurement Specialist; LEG=Legal Counsel; DO=Disbursement Officer; DA=Disbursement Analyst; OO=Operations Officer; OA=Operations Analyst; BA=Budget Analyst; RMS=Resident Mission (Local) Staff 7No Performance Ratings are available; no Form 590s were prepared. IBRD 23539R ETHIOPIA EMERGENCY RECOVERY AND RECONSTRUCTION PROJECT SUD ~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Fk4he ih,e iesk-ordaoo Rood~ Ud., Am---e,o,c Asph.11, I-eI, - G-ooI, oII-oho,, R-,I o-d,o, d,y-,oh~,, Roods U,dsoCom,tn ( R,1 ,: -l , s Mu D A N / > K-rSJ~~~~ ~ ~ ~~~~~~~~~~~~~~~~~ I MA A L I A ./ ~ ~ ~ ~ ~ ~~~~~~~~~ ~ ~ ~ ~~ ~~ ~ ~ ~~~~~~~~~~~~~~~~~~~~~~~ Ado, 'foo ,ego,,t _ optols_ 7/ ,~ ~ ~ ' ,/ rU4 a\ d e 06 //N;> ov I ; U G A N D A 3. ? 4 - N Y A \ > 9 < / 7 KEChtEle2so 52 1lJO 1 200 250 300 330 40~IOME ERO 0 50 00 30 Ž0 20 00 35 60 UGANDA APRIL 1998