The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) REPORT NO.: RES47545 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF DRC - AGRICULTURE REHABILITATION AND RECOVERY SUPPORT APPROVED ON MARCH 30, 2010 TO DRC MINISTRY OF FINANCE,DEMOCRATIC REPUBLIC OF CONGO,DEMOCRATIC REPUBLIC OF CONGO AGRICULTURE AND FOOD AFRICA EAST Regional Vice President: Hafez M. H. Ghanem Country Director: Jean-Christophe Carret Regional Director: Mark R. Lundell Practice Manager/Manager: Shobha Shetty Task Team Leader(s): Joanne Catherine Gaskell, Nora Kaoues The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) ABBREVIATIONS AND ACRONYMS CASA Community Animal Health Officers FM Financial Management INERA National Agricultural Study and Research Institute M&E Monitoring and Evaluation MS Moderately Satisfactory MU Moderately Unsatisfactory PARRSA Agriculture Rehabilitation and Recovery Support Project PDO Project Development Objective PIREDD Integrated Program for Reducing Emissions from Deforestation and forest Degradation PPR Peste des Petits Ruminants SENASEM National Seed Service SNV Netherlands Development Organization UNOPS United Nations Office for Project Services The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P092724 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 30-Mar-2010 30-Jun-2021 Organizations Borrower Responsible Agency DRC Ministry of Finance,Democratic Republic of UNOPS,PARRSA PIU Congo,Democratic Republic of Congo Project Development Objective (PDO) Original PDO The project development objective (PDO) is to increase agricultural productivity and improve marketing of crops, and animal products by smallholder farmers in targeted areas. Current PDO To increase agricultural productivity and improve marketing of crops and animal products crops and animal products in targeted areas of the Recipient s territory. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-59800 22-Mar-2017 19-Apr-2017 16-Feb-2018 30-Jun-2021 75.00 72.28 5.83 IDA-V0680 24-Feb-2017 03-Mar-2017 03-Mar-2017 30-Apr-2018 0 0 0 The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) IDA-H5550 30-Mar-2010 20-May-2010 31-Dec-2010 30-Nov-2017 119.88 114.89 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status 1. Overall progress towards the Development Objective is Moderately Satisfactory. The results framework shows good project performance, with some shortcomings. The PDO indicator related to annual sales of crops and products has exceeded its target (122.5% achievement), the PDO indicator related to direct beneficiaries has been met (100.1% achievement) with female beneficiaries at 95% of the target. The PDO indicator related to annual animal production has been met (105% achievement), while the PDO indicators related to crop yields show more variability. Yields of maize, cassava, rice and peanuts are at 55%, 84%, 80% and 67% of their targets, respectively. 2. Overall Implementation Progress is rated Moderately Unsatisfactory. The closing mission in May downgraded the project FM rating to MU due to shortcomings in budget planning and execution, delay in the transmission of financial reports, weaknesses in contract monitoring, and qualified external audit review. The performance ratings for safeguards and M&E remain MS. Procurement remains MU due to significant delays in the implementation of the UNOPS contract and some missing contract management data. 3. Project implementation has advanced since the project closing date was postponed from December 31, 2020 to June 30, 2021. Evident progress has included: the yield increases for food crops such as maize, cassava, rice and groundnuts; the introduction of improved animal breeds; the training of Community Animal Health Officers (CASA); vaccination campaigns against peste des petits ruminants (PPR) and Newcastle for poultry. Significant results have also been achieved in the context of the PIREDD+ grant in South Ubangi which has financed perennial crops such as coffee and cocoa. In addition, the project has significantly contributed to the establishment of the seed sector and the institutional strengthening of agricultural public services through SENASEM, INERA and SNV, and professional agricultural organizations. 4. Progress on infrastructure work on agricultural service roads in the three provinces has not met expectations. To date, some river crossings have been completed, but others will not be completed before project closing or have been deprogrammed. As a consequence of these incomplete works, the affected road axes are not passible. The efficiency and impact of these road investments is thus uncertain. In addition, there is a risk of ineligible expenditures relating to works not completed and/or not received by the project manager before the project closing date. The project has signed a 6th contract amendment with UNOPS, extending the contract closing date by 15 days until June 15, 2021 with no cost to allow completion and reception of the maximum infrastructure works before project close. The Ebola River cleaning raised The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) biodiversity risks that were not cleared by the end of March, leading this activity to be cancelled in the 6th contract amendment. Other activities that will most likely not be completed include: - 3 of the 24 planned road axes in South Ubangui - 14 of the 44 planned axes in North Ubangui - 4 of the 28 planned axes in Mongala. 5. The lack of critical transportation infrastructure will affect the sustainability of the project outcomes by making it more difficult for farmers to receive necessary agricultural inputs or to find markets for their goods, thus reducing farmers' incentives to invest in agricultural production. The Bank is exploring options to assist the Government to complete these unfinished infrastructure works after the project closing. 6. The project closing date was extended from June 18, 2021 until June 30, 2021 to allow the processing of a partial cancellation of the undisbursed balance. B. Rationale for Restructuring 7. The proposed restructuring responds to the Government request dated June 18th, 2021 to cancel the undisbursed balance of the project. As this project will close on June 30th, the proposed cancellation will allow the undisbursed funds to be invested in other projects to further the country’s development objectives. II. DESCRIPTION OF PROPOSED CHANGES 8. The proposed restructuring entails a partial cancellation of DTS 3,500,000. This amount is based on the undisbursed balance of the project as of June 25th, 2021 (3,764,489.93) and takes into account a conversion difference estimated at 264,489.93 in case of a DTS/USD exchange rate fluctuation. 9. As the project will close in five days, the partial cancellation is not expected to affect the project’s activities, results achievement, or Development Objective. Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. III. SUMMARY OF CHANGES Changed Not Changed Components and Cost ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Implementing Agency ✔ The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) DDO Status ✔ Project's Development Objectives ✔ Results Framework ✔ Loan Closing Date(s) ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_COMPONENTS_TABLE COMPONENTS Current Current Proposed Proposed Cost Action Component Name Component Name Cost (US$M) (US$M) Component 1: Improve Component 1: Improve agricultural and animal 34.85 Revised agricultural and animal 31.35 production production Component 2: Improve market Component 2: Improve market 30.00 No Change 30.00 related Infrastructure related Infrastructure The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) Component 3: Strengthening of Component 3: Strengthening Capacity Building and Project 13.79 Revised of Capacity Building and 11.79 Management Project Management TOTAL 78.64 73.14 OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE CANCELLATIONS Value Reason Current Cancellation New Ln/Cr/Tf Status Currency Date of for Amount Amount Amount Cancellation Cancellation UNDISBURSE IDA-59800- Disburs XDR 55,800,000.00 3,500,000.00 25-Jun-2021 52,300,000.00 D BALANCE 001 ing AT CLOSING Fully IDA-H5550- Disburs XDR 77,212,706.77 0.00 77,212,706.77 001 ed Fully IDA-V0680- Cancell USD 0.00 0.00 0.00 001 ed OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IDA-59800-001 | Currency: XDR iLap Category Sequence No: 1 Current Expenditure Category: G,WK,N/CS,TR,OC ex pt2.1,1.1d,1.2-2 29,592,867.00 26,635,411.97 27,966,266.73 100.00 100.00 iLap Category Sequence No: 2 Current Expenditure Category: GD,SUBGRANT PART 1.1d,1.2-2 5,000,000.00 3,539,119.10 5,000,000.00 100.00 100.00 iLap Category Sequence No: 3 Current Expenditure Category: GOOD, WORK, NCS, CS PART 2.1 20,426,335.00 16,605,959.12 18,552,935.27 100.00 100.00 The World Bank DRC - Agriculture Rehabilitation and Recovery Support (P092724) iLap Category Sequence No: 4 Current Expenditure Category: PPF REFINANCING 780,798.00 780,797.87 780,798.00 Total 55,800,000.00 47,561,288.06 52,300,000.00 . 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