The World Bank Samoa Agriculture Competitiveness Enhancement Project (P115351) REPORT NO.: RES31030 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF SAMOA AGRICULTURE COMPETITIVENESS ENHANCEMENT PROJECT APPROVED ON MARCH 29, 2012 TO MINISTRY OF FINANCE AGRICULTURE EAST ASIA AND PACIFIC Regional Vice President: Victoria Kwakwa Country Director: Michel Kerf Senior Global Practice Director: Juergen Voegele Practice Manager/Manager: Nathan M. Belete Task Team Leader: Stephane Forman The World Bank Samoa Agriculture Competitiveness Enhancement Project (P115351) I. BASIC DATA Product Information Project ID Financing Instrument P115351 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 29-Mar-2012 31-Mar-2018 Organizations Borrower Responsible Agency Ministry of Finance Ministry of Agriculture and Fisheries Project Development Objective (PDO) Original PDO The development objective of the project is to support fruit and vegetable growers and livestock producers to improve their productivity and take greater advantage of market opportunities. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-50890 29-Mar-2012 04-May-2012 27-Jun-2012 31-Mar-2018 8.00 5.59 1.61 TF-12179 04-May-2012 04-May-2012 04-May-2012 30-May-2015 5.00 5.00 0 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No II. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The World Bank Samoa Agriculture Competitiveness Enhancement Project (P115351) A. Summary of proposed change This Restructuring Paper seeks the approval of the Country Director to extend the Samoa Agriculture Competitiveness Enhancement Project (SACEP) closing date by 9 months, from March 31, 2018 to December 31, 2018 and process a reallocation of proceeds among expenditure categories. There will be no other change, in the Project Development Objective (PDO), project components and implementation arrangements. This will be the second extension of the project’s closing date, for a total of 21 months. B. Rationale for Restructuring SACEP was approved on March 29, 2012 and made effective on June 27, 2012. It is financed through a grant of US$5 million from the Global Food Crisis Response Program that closed in 2015 (100% disbursed), and an ongoing IDA Credit of SDR5.2 million (US$8m equivalent) for which the closing date has already been extended once, from March 31, 2017 to March 31, 2018. After a slow start, the project’s implementation pace and disbursement improved in 2016 leading to the upgrade of progress towards achieving the Project Development Objective (PDO) to Satisfactory during the 10th implementation support mission (ISM) held in October 2016, while the Implementation Progress rating was maintained at Moderately Satisfactory. The 12th ISM held in November 2017 confirmed that the PDO remains achievable. Around 87% of the project budget has been disbursed and 79% effectively spent by the project. For most of the Result Framework’s indicators, including key outcomes, final targets are already attained or about to be – although this will need to be confirmed by the Matching Grant Program (MGP) Impact Assessment being finalized (report expected by January 2018) and the Market Survey data cleaning and analysis (report expected by mid-February 2018). The MGP has disbursed over 90% of its funds and 262 beneficiaries have fully completed their investments out of a total of 740 signed grant agreements. The MAF poultry unit has been finalized, and the piggery is close to completion. Good progress has been made with the market linkages program for fruit and vegetable farmers, and on Farmer Field Schools for crops. However, two major activities have experienced significant implementation delays: (i) the construction of the Static Slaughter Unit (SSU), and (ii) the finalization of the remaining 425 MGP sub-projects still in progress (a high number, even if representing only a small share of the MGP budget). As recorded in the related Aide-memoire, the 12th ISM noted that these two activities could not be completed by the current project closing date of March 31, 2018 and discussion were held with both MOF and MAF about the possibility of extending the closing date, which was found acceptable given the overall good progress made by the project. By letter dated December 4, 2017, the Ministry of Finance submitted a request to the World Bank to extend the closing date by an additional 9 months and reallocate funds, mainly towards increasing the size of the category 2 (Matching Grants) perceived as having the largest impact among farmers. C. Description of proposed changes By letter dated December 4, 2017 from the Ministry of Finance, the Government of Samoa (GoS) requested an extension of closing date for the SACEP and a reallocation of proceeds, based on project's projections indicating that it will be challenging to implement all activities and disburse 100% of the funds by end of March, 2018 and that an extension of 9 months will be sufficient to finalize full implementation and deliver all expected results. This was discussed during the 12th ISM and recorded in the corresponding Aide-memoire transmitted to the Recipient through the World Bank’s letters dated November 30, 2017. There are no changes proposed in the PDO, project components, implementation arrangements, risks and safeguards. Therefore, this restructuring will encompass: The World Bank Samoa Agriculture Competitiveness Enhancement Project (P115351)  Closing Date: the project’s closing date will be extended by 9 months, as per the official request received from the GoS. The new date will be set at December 31, 2018, instead of March 31, 2018.  Reallocation of proceeds: the 12th ISM identified the possibility to reallocate some proceeds between categories and components. In particular, savings made in Category (1) Goods, works, non-consulting services, consultants, services, training and operating Costs – thanks to procurement savings and cancellation of activities – allowed to increase the amount allocated to Category (2) Matching Grants that is also perceived as having the largest positive impact on farmers. The amended Implementation Plan associated with this extension of closing date was also submitted to the World Bank by the GoS as an Annex to the official letter requesting the restructuring. It is now expected that the SSU will be completed by end of September 2018 while all Matching Grants-financed sub-project from the third and final Intake will be completed by end of July 2018. III. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IDA-50890 Effective 28-Mar-2017 31-Mar-2018 31-Dec-2018 30-Apr-2019 TF-12179 Closed 30-May-2015 06-Oct-2015 REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Current Current Actuals + Proposed Disbursement % Ln/Cr/TF Expenditure Allocation Committed Allocation (Type Total) Category Current Proposed IDA-50890- GD,WK,Non- 001 CS,CS,Trg&OC ex 3,036,049.00 2,479,764.12 2,872,537.00 100.00 100.00 Currency: P1b,1e,2b XDR Matching Grants 1,127,666.00 1,047,262.09 1,291,178.00 100.00 100.00 Pt 1b and P2b The World Bank Samoa Agriculture Competitiveness Enhancement Project (P115351) GD,Non- CS,CS,Trng&OC- 300,563.00 160,032.80 300,563.00 100.00 100.00 FSS Pt 1e GD,WK,Non- CS,CS,Trg&OC- 735,722.00 0.00 735,722.00 100.00 100.00 Abattoir P1e Total 5,200,000.00 3,687,059.01 5,200,000.00