For Official Use Only CPSCR Review Independent Evaluation Group 66074 1. CPS Data Country: RUSSIAN FEDERATION CPS Year: FY07-11 CPS Period: FY07 – FY11 CPSCR Review Period: FY07 – FY11 Date of this review: December 15, 2011 2. Executive Summary i. This review examines the implementation of the FY07-11 Russian Federation Country Partnership Strategy (CPS) of FY07 and the CPS Progress Report (CPSPR) of FY09, and evaluates the CPSCR. The strategy was Joint between IBRD, IFC and MIGA, and this review covers the program of IBRD and IFC institutions. MIGA had no project with Russian companies during the CPS period. ii. The WBG strategy sought to address key aspects of Russia’s own strategy, focusing on those challenges where it felt could provide solutions complementing those of the country. The WBG strategy was grouped around four key pillars. Under Pillar 1, diversifying the economy for sustainable development and growth, the WBG was to contribute to macroeconomic policy and the effective management of Russia’s large external inflows; continue investment climate monitoring and policy advice, while providing direct support to the private sector; support the government’s investment and PPPs for growth and diversification; and work with regions to identify engines of growth, develop growth strategies and remove barriers to growth, while supporting investments in priority areas at the regional level. Under Pillar 2, improving public sector management and governance, the WBG was to help modernize selected public sector institutions; support the government’s administrative reform; buttress budgetary reforms; help with the reform of local self government; prop municipal development; step up engagement in judicial reform; and support anti-corruption initiatives. Under Pillar 3, improving the delivery of social and communal services, the WBG was to help to continue work on reducing poverty; improve the health of the population; modernize and improve the education system and vocational training; improve the provision of housing and communal services; and ensure housing finance and energy efficiency. Under Pillar 4, enhancing Russia’s global role, as a donor and as a producer of global public goods, the WBG aimed to assist Russia in its role as a donor, and in fulfilling its international obligations regarding global public goods. The strategy also included under this pillar linking Russian companies to global markets. iii. IEG rates overall outcomes of the WBG´s strategy as moderately satisfactory. Russia made progress in managing sovereign debt and assets, including the sovereign funds; in developing a more efficient and client-friendly cadastre system in some regions; had a major PPP for the development of Saint Petersburg’s airport; and made progress on energy efficiency. Russia also made progress on its administrative reform, introducing performance management and budgeting. In addition, tax voluntary compliance has increased. The Ministry of Finance has improved its treasury system, has moved significantly on fiscal federalism, and has developed a better monitoring of the budgets of the local entities. Self-governance at the local level has improved, with a revamped approach in the relationship between government officials and the people. Russia’s statistical system is moving towards international standards. Russia’s poverty declined slightly, targeting of subsidies improved, while some health indicators showed good progress in infant mortality and TB. In addition, Russia moved to include ICT within its educational system. Municipal subsidies have come down in some regions, and mortgage financing of housing is working. Russia has expanded its role as a donor, providing development assistance to countries in need, especially the neighboring ones. Also, Russia CPSCR Reviewed by: Peer Reviewed by: CASCR Review Coordinator Silvina Vatnick, Michael Lav, Consultant, IEGCC Consultant, IEGCC Jaime Jaramillo-Vallejo, Stephen Francis Pirozzi, Albert Martinez, Lead Economist, IEGCC Sr. Evaluation Officer, IEGCC Consultant, IEGCC For Official Use Only CPSCR Review 2 Independent Evaluation Group is now more active addressing global public good issues, especially the environmental challenges. Moreover, Russia is about to fully join the World Trade Organization. Although many of these achievements are localized where the WBG has been piloting them, there are indications that efforts to expand them will continue. There were, however, shortcomings. The economy did not diversify as was hoped; the oil stabilization fund needs a more ambitious savings rule according to the IMF; the increased flow of financing to Russian entrepreneurs did not materialize as expected, despite some progress on capital market regulations; PPPs as an instrument are still lagging, and the WBG was not involved in any significant way in innovation or in spatial economic zones. The WBG efforts on customs, judicial reform and on supporting anti-corruption initiatives fell significantly short of the objectives. Moreover, targeting of subsidies is still a challenge, and some health indicators on maternal mortality and HIV aids fell short of expectations. The quality of education and its match to the labor market remain an issue. On a different front, Russia and the WBG have yet to agree on a trust fund framework. While Russia’s steps on global public goods are positive, they are just at initial stages. IFC completely disregarded the strategy’s objective to link Russian companies to global markets. iv. IEG concurs with the lessons of the CPSCR, but stresses a few points. First, the use of FBS AAA is a very effective way of helping the country move forward, bringing to bear the knowledge of the WBG. Second, the Russia example shows that IFC can be very effective and helpful to the country working with investors in the frontier regions, as was the case with the development of mortgage financing. Third, although focusing on the frontier regions is very important, the WBG needs to find a way of ensuring that these interventions at the local level can be scaled up to broader levels and have, eventually, a country wide impact. Fourth, demand driven strategies are in as much need of an appropriate monitoring and evaluation framework as more traditional ones, if the WBG is to have a good management of those strategies and be accountable for them. Fifth, unrealistic objectives and a weak of country ownership of parts of the program tarnish the good efforts of the country and the WBG country team. 3. CPS Summary Overview of CPS Relevance: Country Context: 1. During the strategy period, Russia’s per capita GDP increased significantly to approximately $10,500 in 2010, moving the country into the upper MIC status. Rising energy prices and strong oil and gas exports fueled almost a decade of robust growth, following the Russian financial crisis of 1998. The Russian economy was hit once again by the global financial crisis of 2008, which brought about a 7.8% drop in GDP in 2009. Russia, however, rebounded relatively quickly from the crisis, aided by strong macroeconomic policies, including pre-crisis fiscal surpluses that allowed a strong counter-cyclical stimulus package in 2009. However, the level of inequality as measures by the Gini coefficient rose from 37.5 in 2007 to 42.3 in 2009. 2. The Russian Government’s vision for the country’s development has been laid out repeatedly, the most recent of which is the ―Concept of Long-Term Social and Economic Development of the Russian Federation through 2020,‖ approved by the Government of the Russian Federation on November 17, 2008. The 2008 Concept was an update of the general approach that was laid out in the 2006-2008 Mid-term Program. The Concept and the previous Russian strategies outline the Government’s strategy to develop the Russian economy into one of the world’s top five economies. The key priorities of Russia’s strategy include: (1) strengthening Russia’s human capital; (2) creating a competitive environment that encourages entrepreneurship and capital investment; (3) diversifying the economy through innovation; (4) strengthening Russia’s global competitiveness in traditional sectors, namely energy, transport, agriculture and natural resources; (5) transition to a new model of spatial For Official Use Only CPSCR Review 3 Independent Evaluation Group development of the Russian economy, promoting regional development and decreasing regional inequalities; and (6) reinforcing and expanding the external economic influence of Russia, increase its role in the world and creating integrated Eurasian economic zone for cooperative development, including transforming Russia into one of the world financial centers. This last point encompassed Russia’s active participation in solving global problems and contributing to the world development by using the humanitarian, innovative and technological potential of the country. Objectives of the WBG Strategy: 3. The WBG strategy sought to address key aspects of Russia’s own strategy, focusing on those challenges where it felt could provide solutions complementing those of the country. The WBG strategy was grouped around four key pillars. Under Pillar 1, diversifying the economy for sustainable development and growth, the WBG was to contribute to macroeconomic policy and the effective management of Russia’s large external inflows; continue investment climate monitoring and policy advice, while providing direct support to the private sector; support the government’s investment and PPPs for growth and diversification; and work with regions to identify engines of growth, develop growth strategies and remove barriers to growth, while supporting investments in priority areas at the regional level. Under Pillar 2, improving public sector management and governance, the WBG was to help modernize selected public sector institutions; support the government’s administrative reform; buttress budgetary reforms; help with the reform of local self government; prop municipal development; step up engagement in judicial reform; and support anti-corruption initiatives. Under Pillar 3, improving the delivery of social and communal services, the WBG was to help to continue work on reducing poverty; improve the health of the population; modernize and improve the education system and vocational training; improve the provision of housing and communal services; and ensure housing finance and energy efficiency. Under Pillar 4, enhancing Russia’s global role, as a donor and as a producer of global public goods, the WBG aimed to assist Russia in its role as a donor, and in fulfilling its international obligations regarding global public goods. The strategy also included under this pillar linking Russian companies to global markets. Relevance of the WBG Strategy: 4. Congruence with Country Context and Program: The WBG strategy was aligned with Russia’s own strategy and focused on addressing the main challenges. The strategy allowed the WBG to expand regional support programs. The CPSPR of 2009 reoriented WBG strategy to tackle the global financial crisis. 5. Relevance of Design: The relevance of design of the WBG strategy varied across the different areas. WBG interventions were well geared toward the strategy’s objectives in some areas. For instance, infrastructure investment and upgrading was a feasible outcome, as were combining public and private sector resources for investment projects, and the implementation of budgetary reforms. However, a number of objectives and sub-objectives were defined too broadly, or were achievable with WBG inputs only under a very optimistic set of assumptions, calling into question the relevance of design of the strategy—these objectives could have been brought down to more realistic levels at the time of the CPSPR. For example, WBG interventions could not have, by themselves, brought about the targeted diversification of the economy or the significant improvement in the judicial system as foreseen in the strategy. Similarly, Russia´s key competitive and innovation and transparency challenges span a very broad set of issues that go well beyond the reach of the WBG program. Moreover, the WBG program had little to offer in conceiving and implementing financial sector regulatory reform or in achieving the stated social and communal services objectives on a large scale across the country. Beyond the link between objectives and interventions, the results framework had some shortcomings in defining and tracking the outcome indicators. In addition, the strategy did not provide operationally relevant outcome measures against which to assess the impact of IFC advisory and investment operations. For Official Use Only CPSCR Review 4 Independent Evaluation Group 6. Relevance of Response to Market: IFC’s program was adjusted to the changes in the market brought about by the global financial crisis. As the financial crisis unfolded, IFC shifted resources and increased support to existing clients. Actions included providing short-term liquidity through the Global Trade Finance Program (GTFP) as well as long-term financing. 7. Risk Identification and Mitigation: The strategy identified macroeconomic risks and implementation risks related to the pace and direction of reform and to the WBG moving to a more regional approach including new modalities of operations. These risks were updated at the time of the CPSPR, which added the challenges of economic recovery and its corresponding social implications. The extent to which the WBG dealt effectively with those risks, in particular the implementation risk, and how it did so, does not come through clearly in the CPSCR. Overview of CAS/CPS Implementation: Lending and Investments: 8. IBRD approved financing for US$ 385 million in 5 operations during the CPS period, most of it in the form of investment lending. Total planned lending was US$620.5 million, the difference accounted for by eight operations which were dropped and two which slipped to future fiscal years. To support improvements in public sector management and governance IBRD delivered two projects for US$ 60 million, –an FY07 SIL on judicial reform and an FY07 APL on State statistical systems. In support of the delivery of social and communal services, IBRD approved in FY08 a US$ 200 million SIL loan on Housing and Communal services using Global Environmental facility (GEF) resources. IBRD also used trust fund financing for a total amount of US$104.7 million, with the largest projects related to Ozone Depleting Substances production and Gas flaring reduction. It also provided special financing of US$ 29.2 million. IBRD continued implementing 18 previously approved projects. 9. IFC made total net commitments of approximately US$3.2billion, 58 percent of which in the financial sector, and 13 percent in transportation and warehousing. The remaining investments were in primary metals, industrial and consumer products (6 percent); agriculture and forestry (5 percent); oil, gas, mining and chemicals (5 percent); collective investment funds (4 percent). At the end of FY11, IFC’s total investment exposure in the Russian Federation was approximately US$2.5 billion or about 6 percent of IFC’s total global investment portfolio. During FY07-FY11, IFC´s net commitment activity in equity participations was 29 percent of the total, with loans accounting for the remaining 71 1 percent. A large share of the lending was trade financing. 10. On IBRD´s side, the share of commitments at risk fluctuated during the strategy period, reaching 23.9% in 2009 and falling to 11.1% in 2011, with 30% of the projects by number being at risk. The percentage of commitments at risk in the country is higher than in ECA (9.4%), but lower than in the world (13.4%) in 2011. Russia´s percentage of projects at risk is significantly higher than in the region (15.9%) and in the world (21.1%). Of 13 projects that were evaluated by IEG over the review period, 12 were rated moderately satisfactory or better. On the IFC side, IEG prepared 26 project evaluations (23 XPSRs and 3 PESs of investment projects). Only 55% had a positive development outcomes rating. The remaining 45% were dominated by financial market projects, which in many cases were adversely affected by the financial crisis. 1 Trade finance under IFC’s GTFP may be accessed multiple times IFC reports as volume figures the sum of the trade flows supported by the trade lines, which are considerably greater than the lines’ nominal values. For Official Use Only CPSCR Review 5 Independent Evaluation Group Analytic and Advisory Activities and Services 11. IBRD delivered most of its planned analytic and advisory activities (AAA). A relevant feature of the AAA deliveries was the large number that was not planned, a significant share of which was delivered as fee based services (FSB). This is strong evidence of a demand driven AAA program. IBRD´s AAA (28 pieces of economic and sector work—ESW, and 71 of technical assistance) covered issues in all four pillars of the strategy. IFC had limited new advisory services (AS) during the strategy period, only one of which addressed the global financial crises. Partnerships and Development Partner Coordination 12. Coordination across multilateral institutions in Russia (IMF, EBRD, EU; OECD) has evolved productively, including with the recently established Eurasian Development Bank (EDB). Safeguards and Fiduciary Issues 13. There were no safeguard issues brought to the Inspection Panel’s attention regarding Russia during the CPS period. On fiduciary issues, INT declared one debarment and two misprocurements for relatively small amounts over the period under consideration. The WBG suspended disbursements for the whole portfolio for about a month in 2009 as a result of delays in refunding the Special Account balance of a project that had been closed in December 2006. Overview of Achievement by Objective: Pillar I: Diversifying the Economy for Sustainable Development and Growth 14. Under this pillar, the WBG strategy was to contribute to macroeconomic policy and the effective management of Russia’s large external inflows; continue investment climate monitoring and policy advice, while providing direct support to the private sector; support the government’s investment and PPPs for growth and diversification; and work with regions to identify engines of growth, develop growth strategies and remove barriers to growth, while supporting investments in priority areas at the regional level.. 15. Contributing to macroeconomic policy and the effective management of Russia’s large external inflows. IBRD worked jointly with the Ministry of Finance looking at the long term fiscal stability, an exercise that exposed the perils of large oil price fluctuations on long-term public finance. The work also looked at the funding gaps in pensions, health and infrastructure. Partly as a consequence of this joint work, in early 2008 Russia split an earlier oil stabilization fund into a Reserve Fund intended as a medium term stabilization fund, and a smaller National Wealth Fund aimed at preserving part of the oil wealth to backstop the pension system. The IMF has estimated that these funds would be appropriate if the non-oil government’s deficit of at most 5.5 percent of GDP. The non- oil fiscal deficit, however, increased from 7.7 percent of GDP in 2008 to a peak of 15.2 percent in 2009 and is projected by the IMF to be about 12.2 percent of GDP in 2011. 16. Under a capital markets development project, IBRD helped develop a new Financial Agency in the Ministry of Finance, responsible for managing sovereign debt and assets, including the sovereign funds. The CPSCR does not report on the activity, effectiveness and governance of that agency. 17. Continuing investment climate monitoring and policy advice, while providing direct support to the private sector. The WBG strategy focused on increasing the availability of finance to For Official Use Only CPSCR Review 6 Independent Evaluation Group Russian entrepreneurs, through land registration and cadastre listings and financial sector development. Although an important objective, it is unclear that access to finance would be a real binding constraint on private sector development or the key determinant in the investment climate. 18. The International Property Rights Index slightly improved from 4.1 over 10.0 in 2008 to 4.6 in 2010. The improvement reflects Russia’s simplification of the procedures for cadastre recording, and creation of the legal basis for a Unified Real Estate Cadastre. Progress was made both at the federal and regional levels, and surveys of client satisfaction show that 70 percent of clients were satisfied with the operation of cadastre offices. However, the CPSCR acknowledges that the land market remains underdeveloped due to weak protection of property rights. 19. Domestic credit available to the private sector increased from 38.8 percent of GDP in 2007 to 45.1 percent in 2010, albeit less than the ratio of broad money to GDP that went from 37 percent to 48 percent in the same period. As rated by the World Economic Forum (WEF), the rating for Russia on Financial Development declined from 3.4 over 7.0 in 2008 to 3.2 in 2010, and the rating on banking financial services also declined from 2.9 over 7.0 in 2008 to 2.1 in 2010. Nevertheless, Russia made some statutory progress on capital markets, introducing new laws on insider-trading and price manipulation, amending the Securities Market Law on disclosure to strengthen transparency, and increasing protection of bond holders’ rights. 20. IBRD, together with the IMF, did an FSAP update in 2008, which focused on financial sector intermediation. In addition an FY 96 Capital Market Development Project (TAL) closed in FY 11, and IBRD provided FBS AAA to the Central Bank of Russia. The great bulk of IFC activities focused on the financial sector, which was progressively dominated by trade finance peaking in FY2011 at a high of 46% of total net commitment volume. IFC’s non-trade finance financial sector investments were predominantly in financial institutions. Much of the investment activity in the banking sector after the crisis was through interest and currency swaps, as well as financing to help improve liquidity and strengthen banks’ capital structure. IFC’s AS in this area were limited. Early in the CPS period, IFC was involved in assisting the development of mortgage and consumer finance products and helped arrange the securitization of both credit card and auto loan receivables—these lines of activity dried out in the wake of the global financial crisis. 21. Support the government’s investment and PPPs for growth and diversification. Diversification of the Russian economy showed little progress during the CPS period. The share of both agriculture and manufacturing in GDP declined between 2007 and 2010, with agriculture going from 4.2 percent of to 3.8 percent and manufacturing from 17.6 percent to 16.4 percent. Moreover, even though the Global Competitiveness Index of Russia produced by the World Economic Forum (WEF) remained at 4.2 over 7.0 between 2007-08 and 2010-11, the sub index for innovation deteriorated slightly from 3.5 to 3.4 over the same period. The CPSCR indicates that the PPPs for infrastructure development are lagging due to the existing restrictions in the Federal Concessions Law, as well as the global financial crisis—Russia’s ownership of the PPP approach seems weak, given the existing legal restrictions. On a different front, in November 2009 Russia adopted the law ―On Energy Efficiency Involvement and Energy Saving.‖ The degree of implementation of this law is not reported in the CPSCR. 22. IBRD had projects on Moscow Urban Transport (FY10), and had four AAA tasks (FBS) on PPPs with St. Petersburg, which laid the basis for Russia’s first concessions in the transport sector. Pulkovo Airport reached financial closure and raised € 1.1billion, the first major PPP in Russia. On a different area, the government did not get the WBG involved in IT parks and innovation. Nevertheless, IFC provided financing to partner banks to support clients involved in agriculture and agribusiness. In addition, IFC support to energy efficiency has been in the form financing to partner banks to support financing of this type of projects—the size and relevance of these operations is not reported in the CPSCR. For Official Use Only CPSCR Review 7 Independent Evaluation Group 23. Working with regions to identify engines of growth, developing growth strategies and removing barriers to growth, while supporting investments in priority areas at the regional level. Russia’s spatial dispersion thwarts economies of scale and of scope, and the WBG strategy aimed at improving the growth and investment climate in the regions with which the WBG worked. Central to this effort was the drafting of national regional strategy for promoting growth points, which has yet to be adopted. Also, the government did not get the WBG involved in projects on special economic zones, another area where the views of Russia and the WBG did not seem to meet. However, many of IBRD’s projects and AAA, as well as IFC’s investment and AS were outside of the traditional urban centers and in frontier regions. 24. IEG rates the achievement of outcomes under Pillar 1 as moderately unsatisfactory. Russia made progress in establishing a financial agency at the Ministry of Finance to manage sovereign debt and assets, including the sovereign funds; developing a more efficient and client-friendly cadastre system in some regions; had a major PPP for the development of Saint Petersburg’s airport; and made progress on energy efficiency. However, the economy did not diversify as was hoped; the oil stabilization fund needs a more ambitious savings rule according to the IMF, the increased flow of financing to Russian entrepreneurs did not materialize as expected, despite some progress on capital market regulations; PPPs as an instrument are still lagging, and the WBG was not involved in any significant way in innovation or in spatial economic zones. Pillar 2: Improving Public Sector Management and Governance 25. As stated in the strategy papers, under this pillar the WBG was to help modernize selected public sector institutions; support the government’s administrative reform; buttress budgetary reforms; help with the reform of local self government; prop municipal development; step up engagement in judicial reform; and support anti-corruption initiatives. There is, however, considerable overlap amongst these objectives, especially in the way the WBG supported them. That is the case, for example, of budgetary reform, which happens to be part of modernizing institutions. For analytical purposes, this review organizes the objectives into the following three sets: modernizing public sector institutions at the federal level; modernizing public institutions at the local level; and engaging in judicial reform and supporting anti-corruption initiatives. 26. Modernizing public sector institutions at the federal level. At the federal level, the strategy targeted administrative reform (federal components), tax modernization, customs development, cadastre and registration, budgeting, treasury development, and statistical development. Cadastre and registration also fell under one of the sub-objectives of Pillar 1. The WBG did not engage on customs development. 27. At the federal level, the WBG support for administrative reform helped implement performance management and performance budgeting, as well as institutionalize regulatory impact assessments. On tax modernization, the WBG helped improve voluntary compliance in the regions where the system was piloted and increase administrative efficiency. As for budgeting, the WBG helped introduce mechanisms to deal with fiscal federalism, including a law on insolvency of regional budgets. Regarding treasury development, the WBT helped introduce treasury principles to budget execution and modernize treasury functions. On statistical development, the WBG supported the adoption of international standards and methodology in statistical products such as national accounts and the balance of payments, an integrated processing system of the statistics, and the establishment of a National Statistical Council. 28. IBRD took the form of several AAA tasks, including a Public Expenditure Review, and projects on treasury development, tax administration, and development of statistical systems. For Official Use Only CPSCR Review 8 Independent Evaluation Group 29. Modernizing public sector institutions at the local level. The WBG support for administrative reform at the local level helped pilot performance management and performance budgeting, including on the executive authorities performance reports to the Ministry of Regional Development. Functional review approaches were also piloted, as well as regulatory impact assessments. Administrative service standards for key services were improved in targeted regions. For Saint Petersburg assistance was provided on the regulations for businesses. Regarding the creation of local self governance, the WBG built capacity of settlement-level administrators in targeted places, including on carrying out effective public hearings, while helping develop new formats for interactions between government officials and the people. On improving budgeting at the local level, the WBG supported a system to monitor sub-national public finances by the Ministry of Finance, as well as the creation of budget authorities at the municipal level and a revision of the revenue and expenditure assignments to the local levels. 30. IBRD provided assistance through several AAA tasks, a project with Saint Petersburg, TA projects on local governance, and a JSDF trust fund activity. 31. Engaging in judicial reform and supporting anti-corruption initiatives. The Legal and Political Environment Index of the International Property Rights Index, which includes judicial independence, rule of law and control of corruption, shows Russia improving slightly from 3.1 over 10.0 in 2008 to 3.5 in 2010. However, the WBG efforts aimed at introducing legislation to provide free legal aid, which contributed to a better treatment of poor litigants—this contribution fell significantly short from what the WBG typically associates with judicial reform, suggesting a difference of view with the government. 32. IBRD support on judicial reform was provided through a judicial reform project, which has performed poorly thus far. Support on governance was provided through a DFID trust fund activity focused on public administration and governance. 33. IEG rates the achievement of the WBG strategy under pillar 2 as moderately satisfactory. Russia made progress on its administrative reform, introducing performance management and budgeting. In addition, tax voluntary compliance has increased. The Ministry of Finance has improved its treasury system, has moved significantly on fiscal federalism, and has developed a better monitoring of the budgets of the local entities. Self-governance at the local level has improved, with a revamped approach in the relationship between government officials and the people. Russia’s statistical system is moving towards international standards. Although many of these achievements are localized where the WBG has been piloting them, there are indications that efforts to expand them will continue. Despite all the progress in these areas, the WBG efforts on customs, judicial reform and on supporting anti-corruption initiatives fell significantly short of the objectives. Pillar 3: Improving the Delivery of Communal and Social Services 34. Under this pillar the WBG was to help to continue work on reducing poverty; improve the health of the population; modernize and improve the education system and vocational training; improve the provision of housing and communal services; and ensure housing finance and energy efficiency. 35. Continuing the work on reducing poverty. The national poverty rate fell from 13.4 percent in 2008 to 13.2 percent by end-2009, and then to 13.1 percent in 2010. At the end of 2010, 18.5 million people were still below the poverty line. While targeting of social protection programs may have improved, recent estimates show that up to one quarter of social support beneficiaries are not poor. At the regional level, labor market policies for the unemployed were introduced to mitigate the impact of the crisis on employment, as was weekly monitoring of labor market indicators. For Official Use Only CPSCR Review 9 Independent Evaluation Group 36. IBRD provided support through two pieces of AAA, one of them a technical assistance on labor market policies and monitoring. 37. Improving health of the population. Maternal mortality per hundred thousand births increased from 22 in 2007 to 32 in 2010, while infant mortality per thousand births declined from 11.4 to 9.1 in the same period. A 10 percent mortality reduction was reached on new cases of tuberculosis (TB) during the CPS period, coupled with a 5 percent decrease in new TB cases. However, there has been no progress in reducing the percent of HIV positive infants born to HIV-infected women. A greater share of regional health budgets is now spent on primary health care, and the Ministry of Health and Social Development has now improved standards and a better grip on what was a highly decentralized system. 38. IBRD support included two AAA tasks, and three projects, one of them recent and still going. In addition IFC invested in private and municipal health services, financing private sector health sector providers. 39. Modernizing and improving the education system and vocational training. Russia has introduced modern educational technologies enhanced by information and communication technologies. These are framed within a national curriculum of 75,000 new digital teaching resources, which is used in 13 subjects for all grades. Nearly 37 regions applied information and communication technologies (ICT) in education with 23,000 students participating in ICT-based educational projects and 130,000 teachers and 3,900 pedagogical university students being trained—these volumes, however, represent a fraction of potential users and beneficiaries. Two regions adopted development programs in vocational education focusing on better linkages to labor markets. Six regions adopted curriculums for early childhood development (ECD) and preschool education. In higher education, Tatarstan adopted institutional strategies for universities. In addition, the government approved the institutional strategy of the Higher School of Economics, a leading learning center of social and economic sciences. 40. IBRD has been engaged in the education sector through e-Learning support project and eight AAA tasks, most of which with a regional focus. 41. Improving the quality and quantity of affordable housing and utilities available to the population. From 2007 to 2009 a number of financial institutions with backing from IFC channeled 150 thousand housing finance loans over the strategy period, with these banks ending 2009 with holdings of US$4.3 billion in outstanding mortgage portfolio. In addition, financing is now available for renovations of common areas in multi-story apartment buildings, preferable for those that are energy efficient. Thirteen cities introduced widespread metering of water consumption. In eight regions, 41 cities modernized their heat supply systems while improving cost recovery. 42. The WBG supported federal efforts in the housing and utility sectors through a variety of instruments, including IBRD project lending for municipal waste and wastewater, municipal heating, and housing and communal services, as well as IFC lending for mortgages and renovations. There were several pieces of advisory services by both IBRD and IFC. 43. IEG rates the achievement of outcomes of the WBG strategy under Pillar 3 as moderately satisfactory, but marginally so Russia’s poverty declined slightly, targeting of subsidies improved, while some health indicators showed good progress in infant mortality and TB. In addition, Russia moved to include ICT within its educational system. Municipal subsidies have come down in some regions, and mortgage financing of housing is working. However, targeting of subsidies is still a challenge, and some health indicators on maternal mortality and HIV aids fell short of expectations. The quality of education and its match to the labor market remain an issue. For Official Use Only CPSCR Review 10 Independent Evaluation Group Pillar 4: Enhancing Russia´s Global Role 44. Under this pillar, the WBG aimed to assist Russia in its role as a donor, and in fulfilling its international obligations regarding global public goods. The strategy also aimed at linking Russian companies to global markets. 45. Assisting Russia in its role as a donor. In the context of Russia’s role as a responsible member of the G8, G20, and other fora, the country has moved from being a big player providing debt relief, into becoming a steady provider of development assistance. Russia’s development assistance increased significantly from US$ 102 million in 2006 to US$ 785 million in 2009 and an estimated US$ 500 million in 2010. In addition, in 2009 and as part of the leading countries’ response to the global financial crisis, Russia contributed US$ 7.5 billion to the EurAsEC-Anti-crisis Fund administered by the Eurasia Development Bank (EDB) and US$ 65 million to two World Bank-administered trust funds. By March 2011, Russia had contributed a total of US$ 518 million to several World Bank-administered trust funds. Nevertheless, Russia has yet to agree with the World Bank on a trust fund framework agreement. 46. IBRD has provided support to Russia’s role as a donor through a couple of AAA tasks and by being a partner in administering several trust funds, but has yet to work out a framework agreement. In addition, IFC is promoting South-South investments among its Russian clients. The extent of these investments is not reported by the CPSCR. 47. Fulfilling Russia’s international obligations regarding global public goods. Russia has integrated itself more fully into multilateral initiatives aimed preserving the environment. These efforts, discussed below, have yielded results in environmental management, carbon finance and climate change, meteorological systems, the forestry sector and the Global Tiger Initiative. 48. Environmental management: Russia has undertaken some pollution abatement projects to deal with the negative impact of large pulp and paper mills, as well as a silkworm outbreak in Siberia. Moreover, the country also revamped its air quality monitoring in the Ural an Upper Volga region. IBRD provided support through an environmental management project. In addition and as is the case in other countries, IFC has been requesting all its investees to follow its Policy and Performance Standards on Environmental and Social Sustainability 49. Carbon finance and climate change: Although the Russian government has moved towards a more active stance on climate change issues, as evidenced by the steps on clean energy mentioned above, the country has yet to take a greater leadership role on climate change, and to fully use the carbon finance instruments available to it—the degree of country ownership of this approach appears to have been weak. Nevertheless, Russia (Rosneft) was able to agree with IBRD a carbon finance deal that would reduce gas- flaring by two million tons of ERUs, while CoreCarbon’s deal with IFC would reduce about two million tons of nitrous oxide emissions. The WBG has provided support to Russia through the projects that led to these two deals, as well as through other projects and advice on energy sustainable and efficient energy. 50. Meteorological systems: Russia has restored and modernized Roshydromet, incorporating high technology and improving its prompt reporting to the World Meteorological Organization. Better forecasting systems have allowed the country to respond more effectively to weather related emergencies. IBRD supported Russia, beyond the objectives set out originally in the strategy, with a project that is still ongoing, but that has already made significant contributions. 51. Forestry sector: With support from IBRD, seven regions improved forest fire monitoring and communications, and a number of brigades were equipped and trained. IBRD efforts have been in conjunction with the EU and channeled through a couple of projects, one of which is still ongoing and the closes one taking ten years and being rated by IEG as moderately unsatisfactory. For Official Use Only CPSCR Review 11 Independent Evaluation Group 52. Global Tiger Initiative: Russia hosted the Global Tiger Summit in Saint Petersburg in late 2010. IBRD attended at the request of the government, beyond the objectives of the strategy, providing technical assistance. 53. The WBG supported Russia’s greater involvement in global initiatives through a variety IBRD’s AAA tasks, as well as IFC carbon finance operations. The bulk of these activities, however, came at a late stage of the CPS period and has yet to bear fruit. 54. Linking Russian companies to global markets. Russia is making progress in its soon to be accomplished accession to the World Trade Organization, with the support of AAA from IBRD. IFC reports that, within its investees, there has been South-South investments flowing into four Russian companies for a total of about US$ 500 million. These investment flows, however, do not imply a link of these Russian companies to the global markets in which their products are traded. IFC does not provide data on the activities of its investees abroad, which was the strategy’s objective. 55. IEG rates the strategy’s outcomes under Pillar 4 as moderately satisfactory. This rating, however, is entirely based on IBRD’s efforts, because IFC’s activities in support of Russian companies fell short even in reporting. In terms of the pillar, Russia has expanded its role as a donor, providing development assistance to countries in need, especially the neighboring ones. In addition, Russia is now more active addressing global public good issues, especially the environmental challenges. Furthermore, Russia is about to fully join the World Trade Organization. However, Russia and the WBG have yet to agree on a trust fund framework. Also, Russia’s steps on global public goods, although very positive, are just in their initial stages. Objectives IEG Rating Pillar I: Diversify the Economy for Sustainable Moderately Unsatisfactory Development and Growth Pillar II: Improve Public Sector Management and Moderately Satisfactory Performance Pillar III: Improve the Delivery of Communal and Social Moderately Satisfactory Services Pillar IV: Enhancing Russia´s Global Role Moderately Satisfactory 4. Overall IEG Assessment Overall Outcome: Rating: Moderately Satisfactory IBRD Performance: Rating: Moderately Satisfactory IFC Performance: Rating: Moderately Satisfactory Overall outcome: 56. IEG rates overall outcomes of the WBG´s strategy as moderately satisfactory. Russia made progress in managing sovereign debt and assets, including the sovereign funds; in developing a more efficient and client-friendly cadastre system in some regions; had a major PPP for the development of Saint Petersburg’s airport; and made progress on energy efficiency. Russia also made progress on its administrative reform, introducing performance management and budgeting. In addition, tax voluntary compliance has increased. The Ministry of Finance has improved its treasury system, has moved significantly on fiscal federalism, and has developed a better monitoring of the budgets of the local entities. Self-governance at the local level has improved, with a revamped approach in the relationship between government officials and the people. Russia’s statistical system is moving towards international standards. Russia’s poverty declined slightly, targeting of subsidies improved, For Official Use Only CPSCR Review 12 Independent Evaluation Group while some health indicators showed good progress in infant mortality and TB. In addition, Russia moved to include ICT within its educational system. Municipal subsidies have come down in some regions, and mortgage financing of housing is working. Russia has expanded its role as a donor, providing development assistance to countries in need, especially the neighboring ones. Also, Russia is now more active addressing global public good issues, especially the environmental challenges. Moreover, Russia is about to fully join the World Trade Organization. Although many of these achievements are localized where the WBG has been piloting them, there are indications that efforts to expand them will continue. There were, however, shortcomings. The economy did not diversify as was hoped; the oil stabilization fund needs a more ambitious savings rule according to the IMF; the increased flow of financing to Russian entrepreneurs did not materialize as expected, despite some progress on capital market regulations; PPPs as an instrument are still lagging, and the WBG was not involved in any significant way in innovation or in spatial economic zones. The WBG efforts on customs, judicial reform and on supporting anti-corruption initiatives fell significantly short of the objectives. Moreover, targeting of subsidies is still a challenge, and some health indicators on maternal mortality and HIV aids fell short of expectations. The quality of education and its match to the labor market remain an issue. On a different front, Russia and the WBG have yet to agree on a trust fund framework. While Russia’s steps on global public goods are positive, they are just at initial stages. IFC completely disregarded the strategy’s objective to link Russian companies to global markets. IBRD Performance: 57. IEG rates IBRD´s performance as moderately satisfactory. IBRD showed great flexibility to respond promptly and effectively to the requests from Russia, and found a space at the regional and municipal levels. The increase in FBS AAA is noteworthy. The relevance of design of the strategy was limited by some projected outcomes being unrealistic with the existing range of IBRD instruments, while other outcomes were too broad or ambitious given the depth of the problems and the sheer scale of the country. Moreover, the CPSPR could have better adapted the objectives of the strategy to what was achievable, and brought in a better M&E framework. The performance of IBRD´s portfolio in Russia, as measured by the percentage of commitments at risk, was in between overall average rates for the IBRD and ECA, but measured by both percentage of projects at risk and by outcome ratings of projects, was higher than average IBRD and ECA levels. The identification and mitigation of the risks of the strategy did not seem to have played a significant role in its implementation. Coordination with other external partners was satisfactory, as was attention to environmental issues. IFC Performance: 58. IEG rates IFC´s performance as moderately satisfactory. The period under review was characterized by rapidly changing circumstances in global markets. IFC managed to react quickly and effectively to the needs of its portfolio clients, and had a larger program than IBRD in financial terms. With regard to implementation, IFC’s activities are encouraging, although there are areas of concern. Overall, IFC´s additionality was present in most activities. However, IFC evaluations show that financial markets projects performed below the average of evaluated projects with respect to development outcomes. The financial crisis likely influenced financial performance. However, IFC work quality in these projects was also below the average. IFC’s sub-national and municipal investments were in line with helping improve infrastructure in less developed regions, have proven to be replicable but were limited. IFC’s efforts to finance energy efficiency undertakings have started with local support but their replicability on a larger scale has yet to be proven. There is currently no agreed upon evaluative framework for IFC’s trade finance products. As this product continues to increase in use, it is imperative that a results and evaluation framework be developed. In addition, IFC’s complete disregard of reporting on the strategy’s intention to link Russian companies to global markets is troublesome. For Official Use Only CPSCR Review 13 Independent Evaluation Group 5. Assessment of CPS Completion Report 59. The CPSCR is probably one of the best ever reviewed by IEG, but has a serious shortcoming in that it deviated from the objectives as set out in the CPS and the CPSPR. Adjusting for this flaw, the CPSCR has a schematic presentation of outcomes, and WBG contributions and interventions that is very effective. The CPSCR included interventions that had closed before the beginning of the CPS period, bringing into play information that is not really relevant for drawing lessons. 6. Findings and Lessons 60. IEG concurs with the lessons of the CPSCR, but stresses a few points. First, the use of FBS AAA is a very effective way of helping the country move forward, bringing to bear the knowledge of the WBG. Second, the Russia example shows that IFC can be very effective and helpful to the country working with investors in the frontier regions, as was the case with the development of mortgage financing. Third, although focusing on the frontier regions is very important, the WBG needs to find a way of ensuring that these interventions at the local level can be scaled up to broader levels and have, eventually, a country wide impact. Fourth, demand driven strategies are in as much need of an appropriate monitoring and evaluation framework as more traditional ones, if the WBG is to have a good management of those strategies and be accountable for them. Fifth, unrealistic objectives and a weak of country ownership of parts of the program tarnish the good efforts of the country and the WBG country team. Annexes CPSCR Review 15 Independent Evaluation Group Annex Table 1a: Russia Planned and Actual Lending, FY07-11 Annex Table 1b: Russia Trust Funds, FY07-11 Annex Table 2: Planned and Actual Analytical and Advisory Work, FY07-11 Annex Table 3a: IEG Project Ratings for Russia, FY07-11 Annex Table 3b: IEG Project Ratings for Russia, FY07-11 Annex Table 4: Portfolio Status for Russia and Comparators, FY07-11 Annex Table 5: IBRD Net Disbursements and Charges Summary Report for Russia, FY07-11 Annex Table 6: Total Net Disbursements of Official Development Assistance and Official Aid Annex Table 7: Economic and Social Indicators for Russia and Comparators, 2007 - 2010 Annex Table 8: Russia - Millennium Development Goals Annex Table 9: List of IFC’s Investments in the Russian Federation that were active during FY09-11 (US$’000) Annex Table 10. List of IFC’s Advisory Services in Russia, FY09-11 Annex Table 11: Summary of Achievements of the CPS Objectives Annexes CPSCR Review 17 Independent Evaluation Group Annex Table 1a: Russia Planned and Actual Lending, FY07-11 Proposed Proposed Approved Project Approval FY FY Amount Amount Programmed projects Judicial Reform Support 2007 2007 50.0 50.0 State Stat Ssyst2 2007 2007 10.5 10.0 Housing & Comm Servs Ref 2007 2008 200.0 200.0 IT Parks 2007 Dropped 20.0 Microfinance INFR 2008 Dropped 50.0 Spec Econ Zones 2008 Dropped 50.0 SUAL Guarantee (Komi Commercial) 2008 Dropped Science & Technology 2009 Dropped Public Sector Efficiency 2009 Dropped Municipal Budgeting 2009 Dropped Prg Related Activity - Guarantee 2009 Dropped So Okrug Loc Inits 2008 Forwarded to FY12 PCG for VEB Infrastructure Finance 2010 Forwarded to FY12 500.0 Total Programmed projects CPS FY07-11 880.5 260.0 Non-programmed projects Russia Cultural Heritage 2 2011 100.0 Financial Education and Financial Literacy 2011 25.0 Total projects CAS FY07-11 excluding Grants and Special Financing Projects 880.5 385.0 Approval Approved On Going Projects During CAS Period Closing FY FY Amount Environmental Management Project 1995 2011 110.0 Capital Market Development Project 1996 2011 89.0 Sustainable Forestry Pilot Project 2000 2010 60.0 Regional Fiscal Technical Assistance Project 2000 2011 30.0 Northern Restructuring Project 2001 2010 80.0 Municipal Heating Project 2001 2008 85.0 Moscow Urban Transport Project 2001 2009 60 Municipal Water & Wastewater Project 2001 2009 122.5.0 Treasury Development Project 2002 Active 231.0 St. Petersburg Economic Development Project 2003 Active 161.1 Customs Development Project 2003 Active 140.0 Tuberculosis & AIDS Control Project 2003 2009 150.0 Health Reform Implementation Project 2003 2009 30.0 Tax Administration Modernization 2 Project 2003 2008 100.0 e-Learning Support Project (APL #1) 2004 2008 100.0 Hydrometerological System Modernization Project 2005 Active 80.0 Registration Project 2006 Active 50.0 Cadastre Development Project 2006 2011 100.0 Total On Going projects CAS FY08-11 1,778.6 Total projects CAS FY08-111/ 2,163.6 Source: Russia 2006 CPS, 2009 CPSPR and WB Business Warehouse Table 2a.1, 2a.4 and 2a.7 as of 10/31/2011. 1/ Excluding Grants and Special Financing Projects Annexes CPSCR Review 18 Independent Evaluation Group Annex Table 1b: Russia Trust Funds, FY07-11 Approved Approval FY Project ID Amount Renewable Energy (GEF) 2005 0.4 P079033 Public Expenditure Management and Peer-Assisted Learning (PEM- PAL) in the Europe and Central Asia Region Agreement 2007 0.2 TF 070664 Ozone-Depleting Substances Production Phase-Out Technical Assistance GEF Project 2007 26.2 P049968 Renewable Energy (GEF) 2008 0.7 P079033 PO Policy Adv Initiative, Phase III 2009 0.3 P111614 Financial Literacy and Education Agreement 2009 0.7 TF 071069 Judicial Reform Support Project 2009 1.9 P089733 Russia Education Aid for Development Agreement 2009 3.6 TF 071154 Energy Small and Medium Enterprises Support in Sub-Saharan Africa Agreement 2009 24.3 TF071223 CF 4: Rosneft Gas Flaring Reduction Project 2009 74.8 P102324 CIS Statistical Committee Training Program 2011 0.4 P125268 Multi-Donor Programmatic Trust Fund Europe and Central Asia Public Finance Management 2011 0.6 TF071577 Total Special Financing CAS FY07-11 133.9 Source: Russia 2006 CPS, 2009 CPSPR, Client Connection, e-trust, and WB Business Warehouse as of 10/31/2011. Annexes CPSCR Review 19 Independent Evaluation Group Annex Table 2: Planned and Actual Analytical and Advisory Work, FY07-11 Project Proposed Delivered to Output Type ID FY Client FY Economic and Sector Work Planned (CPS FY2007-2011) Programmatlc Poverty P074995 2007 2009 Report ICA (Russia – Region) P089187 2007 2007 Report CEM (Stage 2 Thematic) P076129 2007 2008 Report Housing P093771 2007 2007 Report CPAR - RU P096188 2007 2007 Report Industrial Pollution Abatement P097152 2007 2007 Report Housing Market Study P097193 2007 2007 Report Assess & Model Ref I 2007 Dropped Self Gov & Civic Engmt 2007 Dropped Youth Empowerment & Security 2007 Dropped GDLN 2007 Dropped Legal & Judicial Capacity Bldg - IDF 2007 Dropped Port - Audit Firm Rvw 2007 Dropped HLT ADV SERV 2007 Dropped EDUC/SP ADV SERV 2007 Dropped INFRNEGY Policy DIA 2008 Dropped Regional HD Public Expenditure Review P112803 2010 2010 Report PER P112597 2010 2011 Report Regional Growth P112607 2010 2011 Report Non-planned FSAP update Russia P104863 2008 Report Energy Efficiency Study P096612 2008 Report Environmental Performance Review P108003 2008 Report Russia Grain Reserves Study P116560 2009 Policy Note Local Governance and Accountability in Russia P113288 2009 Report Consumer Protection P112491 2009 Report State Grain Trading P114108 2009 Policy Note Vulnerability Review P116343 2009 Policy Note Policy Note On Demography P107778 2009 Report Long Term Fiscal Sustainability P107247 2010 Report Russia Financial Sector Memorandum P116124 2010 Policy Note Regional HD Public Expenditure Review P112803 2010 Report Russian Economic Reports P117775 2010 Report Russia - Rpt On Observance Of Standards And Codes P090360 2010 Report Green Investment Scheme (GIS) Options Study (CFB) P096392 2010 Report Russia DB Sub-National P108387 2010 Report Export Diversification, Competition and Innovation P108962 2011 Report Russian Economic Report II P122962 2011 Report Technical Assistance Planned (CPS FY2007-2011) Rural Finance P097151 2007 2007 "How-To" Guidance PUB Admln REF IN RU P085612 2007 2007 "How-To" Guidance Housing Conference P097195 2007 2007 Knowledge-Sharing Forum G-8 Adv Servs/Ta P095097 2007 2007 "How-To" Guidance Perf-Based Budgeting P097625 2007 2007 "How-To" Guidance Water Qual. Mgt Impr P093645 2007 2007 "How-To" Guidance Agrlc Pol Mntrg TA P091861 2007 2007 "How-To" Guidance Civil Service Ref Ta P094428 2008 2008 "How-To" Guidance Southern Okrug Human Development Technical Assistance P102116 2008 2007 Institutional Development Plan Reg Infrastr Study/Assmt Ta 2009 Dropped Fin Sect Dialogra 2009 Dropped Environment Sector Dialog 2009 Dropped Regional Development P109701 2009 2009 "How-To" Guidance Donor Relations (Ida Donor Services) 2009 Dropped Non-planned Rural Sector Dialogue P101373 2007 "How-To" Guidance Health Advisory Services P102229 2007 "How-To" Guidance Hd Advisory Services P102593 2007 Client Document Review Evaluating and Modeling Reform Impact TA P095629 2007 "How-To" Guidance Finnish Neighboring Cooperation Area Trust Fund P088057 2007 "How-To" Guidance FFS Transport Kazan Internatl Airport P110746 2008 "How-To" Guidance Annexes CPSCR Review 20 Independent Evaluation Group Project Proposed Delivered to Output Type ID FY Client FY FFS Transport Western High Speed Diameter / Orlovski Tunnel P109067 2008 "How-To" Guidance FFS Urban PPP UNIT IN ST Petersburg P109594 2008 "How-To" Guidance FFS Higher Education Kazan P108985 2008 "How-To" Guidance FFS Education Khanty-Mansisk AO P108590 2008 "How-To" Guidance NATL. Training Workshop on JI/GIS (CF ASSIST) P108150 2008 Knowledge-Sharing Forum FFS Transport Pulkovo Airport Expansion Ppp St Petersburg P109593 2008 "How-To" Guidance FFS Transport Nadzemny Express Ppp St Petersburg - Part 1 P108703 2008 "How-To" Guidance HD Advisory Services P107970 2008 "How-To" Guidance Quality Of Local Governance P110537 2009 "How-To" Guidance POST FSAP TA P108310 2009 "How-To" Guidance Forest Reform P104632 2009 Knowledge-Sharing Forum HD Advisory Services P113017 2009 "How-To" Guidance Economic Diversification P108164 2009 Knowledge-Sharing Forum FFS Transport Volgograd Feasibility By-Pass P114071 2009 "How-To" Guidance Survey to Monitor Living Standards in Tatarstan (Russian Federation) P110627 2009 Model/Survey FFS Transport Nadzemny Express Ppp St Petersburg - Part 2 P108704 2009 "How-To" Guidance Reimbursable Niznhevartovsc Housing Community Services P110129 2009 "How-To" Guidance Advisory Services: Khanti-Mansiysk Autonomous Okrug-Yugra P110048 2009 "How-To" Guidance FFS Krasnoyarsk Vocational Education P115371 2009 "How-To" Guidance FFS Tver Oblast Vocational Education P111759 2009 "How-To" Guidance Regional Program Development (Cross Sectorial) P102217 2009 "How-To" Guidance Quality of Local Governance TA financed by JSDF P110537 2009 "How-To" Guidance Energy Efficiency Study P115372 2010 "How-To" Guidance Policy Dialog On PPP P108022 2010 "How-To" Guidance Environmental Liabilities P114816 2010 "How-To" Guidance FBS Support for Innovation in the Republic of Tatarstan P118130 2010 "How-To" Guidance FFS Preschool and ECD Khanty-Mansiysk AO P111566 2010 "How-To" Guidance Improvement of the Regional Early Childhood Development and Preschool Education System P117850 2010 "How-To" Guidance Labor Market Monitoring and Policy Assessment P118448 2010 "How-To" Guidance Crisis Response TA P102441 2010 "How-To" Guidance Cultural Heritage 2 P114812 2010 "How-To" Guidance Public-Private Partnership Development Project P114839 2010 "How-To" Guidance Debt Service Trust Fund P073467 2010 "How-To" Guidance FFS Higher Education Kazan II P113989 2010 "How-To" Guidance FBS Agreement for Advisory Services TA to support LISP implementation P117471 2010 "How-To" Guidance Assistance in Restructuring the HealthCare System and Medical Education in the Khanty-Mansiysk Autonomous Okrug P111216 2010 Client Document Review Subnational Doing Business in Russia P105815 2010 Client Document Review Hd Advisory Services P118156 2011 "How-To" Guidance FBS-14-FY11: Nurturing Innovation Mgnt in Russia P125925 2011 "How-To" Guidance RU Innovation P123690 2011 "How-To" Guidance Financial Sector Technical Assistance to the Russian Federation P123029 2011 "How-To" Guidance FFS Higher school of Economics P111119 2011 Institutional Development Plan FBS Perm Forestry Review P125162 2011 "How-To" Guidance FBS-ST. Petersburg - Urban Transport Strategy - Part 1/2 P125148 2011 "How-To" Guidance FBS Central Bank of Russia (FBS-06-10) - Information and Analytical System for the CBR's PS P122493 2011 "How-To" Guidance Mono Cities P125549 2011 "How-To" Guidance FBS-St. Petersburg - Urban Transport Strategy - Part 1/1 P124324 2011 "How-To" Guidance FBS TA to support the Stavropol Krai LISP Implementation P121866 2011 "How-To" Guidance FBS Advisory Services TA for Kirov Oblast LISP Implementation P121856 2011 "How-To" Guidance FFS Transport Pulkovo Airport Part 3 P122190 2011 "How-To" Guidance FBS- Moscow Social Protection P122457 2011 "How-To" Guidance Public Expenditure Management and Efficiency TA P119392 2011 "How-To" Guidance Southern Okrug Local Initiatives Support Project P114919 2011 "How-To" Guidance FBS Kirov Health P122703 2011 "How-To" Guidance Financial Literacy and Financial Education P114792 2011 "How-To" Guidance FFS Transport Pulkovo Airport Expansion PPP St Petersburg Part 2 P111493 2011 "How-To" Guidance Source: Russia 2006 CPS, 2009 CPSPR and WB Business Warehouse Table 8.1.4 as of 10/31/2011. Annexes CPSCR Review 21 Independent Evaluation Group Annex Table 3a: IEG Project Ratings for Russia, FY07-11 Total Evaluated IEG Risk to Development Exit FY Project Name IEG Outcome (US$M) Outcome * 2007 Educ Reform 46.2 Satisfactory Negligible To Low 2008 State Stats Syst 29.9 Satisfactory Negligible To Low 2009 Elec Sectr Ref 37.9 Moderately Satisfactory Moderate 2010 Kazan Municipal Devt 125.0 Highly Satisfactory Negligible To Low 2008 Mun Heating 79.6 Satisfactory Significant 2009 Tax Adm 2 72.2 Moderately Satisfactory Significant 2010 E-Lrn Suprt (Apl #1) 95.7 Highly Satisfactory Negligible To Low 2009 Mun Water & Ww 69.6 Moderately Satisfactory Moderate 2010 Mosc Urb Trans 53.6 Satisfactory Negligible To Low 2011 Health Ref Imp 19.8 Satisfactory Negligible To Low 2012 Tb/Aids Control 85.2 Satisfactory Significant 2010 Sust Forestry Pilot 39.4 Moderately Unsatisfactory Moderate 2011 Ru Cap Mrkt Devt 47.2 Moderately Satisfactory Significant Source: WB Business Warehouse Table 4a.5 and 4a.6 as of as of 410/31/2011. * With IEG new methodology for evaluating projects, institutional development impact and sustainability are no longer rated separately Annex Table 3b: IEG Project Ratings for Russia, FY07-11 Total RDO % Total Outcome Outcome RDO % Moderate Region Evaluated Moderate or Evaluated ($M) % Sat ($) % Sat (No) or Lower ($) * (No) Lower (No) * Russia 801.5 13 95.1 92.3 64.5 69.2 China 5,448.5 43 94.0 97.7 98.8 97.6 Kazakhstan 325.6 4 100.0 100.0 100.0 100.0 Poland 854.4 7 88.7 71.4 87.3 66.7 Mexico 1,921.7 16 71.1 68.8 71.2 81.3 ECA 8,141.7 192 87.0 81.8 75.5 64.1 World 47,789.6 870 82.5 75.0 69.2 59.5 Source: WB Business Warehouse Table 4a.5 and 4a.6 as of as of 10/31/2011. * With IEG new methodology for evaluating projects, institutional development impact and sustainability are no longer rated separately. Annexes CPSCR Review 22 Independent Evaluation Group Annex Table 4: Portfolio Status for Russia and Comparators, FY07-11 Fiscal year 2007 2008 2009 2010 2011 Russia # Proj 20.0 18.0 14.0 12.0 10.0 # Proj At Risk 0.0 1.0 5.0 2.0 3.0 % At Risk 0.0 5.6 35.7 16.7 30.0 Net Comm Amt 1,770.5 1,676.1 1,297.0 1,136.5 987.0 Comm At Risk 0.0 80.0 310.0 100.0 110.0 % Commit at Risk 0.0 4.8 23.9 8.8 11.1 China # Proj 74.0 74.0 78.0 79.0 84.0 # Proj At Risk 3.0 4.0 5.0 14.0 16.0 % At Risk 4.1 5.4 6.4 17.7 19.0 Net Comm Amt 9,907.7 9,769.7 10,356.8 10,287.0 10,481.2 Comm At Risk 398.8 522.0 528.0 1,479.1 1,877.8 % Commit at Risk 4.0 5.3 5.1 14.4 17.9 Kazakhstan # Proj 10.0 12.0 11.0 14.0 14.0 # Proj At Risk 3.0 2.0 3.0 2.0 3.0 % At Risk 30.0 16.7 27.3 14.3 21.4 Net Comm Amt 568.5 618.1 2,597.8 3,662.8 2,665.5 Comm At Risk 94.0 59.0 83.4 48.4 66.6 % Commit at Risk 16.5 9.5 3.2 1.3 2.5 Poland # Proj 8.0 7.0 5.0 5.0 5.0 # Proj At Risk 2.0 1.0 2.0 1.0 1.0 % At Risk 25.0 14.3 40.0 20.0 20.0 Net Comm Amt 767.0 735.5 1,764.2 1,795.3 1,578.5 Comm At Risk 99.8 11.0 195.0 11.0 11.0 % Commit at Risk 13.0 1.5 11.1 0.6 0.7 Mexico # Proj 22.0 19.0 20.0 23.0 22.0 # Proj At Risk 2.0 3.0 5.0 3.0 5.0 % At Risk 9.1 15.8 25.0 13.0 22.7 Net Comm Amt 2,321.5 2,165.8 3,949.0 6,908.4 7,637.6 Comm At Risk 270.0 154.3 373.6 568.7 287.7 % Commit at Risk 11.6 7.1 9.5 8.2 3.8 ECA # Proj 306.0 303.0 287.0 276.0 251.0 # Proj At Risk 27.0 38.0 52.0 50.0 40.0 % At Risk 8.8 12.5 18.1 18.1 15.9 Net Comm Amt 16,687.4 17,966.1 21,383.2 24,340.5 22,535.4 Comm At Risk 1,680.9 2,257.0 3,460.2 4,357.1 2,116.9 % Commit at Risk 10.1 12.6 16.2 17.9 9.4 World # Proj 1,485.0 1,525.0 1,552.0 1,590.0 1,595.0 # Proj At Risk 243.0 276.0 344.0 366.0 337.0 % At Risk 16.4 18.1 22.2 23.0 21.1 Net Comm Amt 100,357.1 106,761.7 131,076.4 158,287.4 168,248.7 Comm At Risk 15,354.3 18,428.2 19,929.9 28,186.1 22,978.5 % Commit at Risk 15.3 17.3 15.2 17.8 13.7 Source: WB Business Warehouse Table 3a.4 as of 10/31/2011. Annexes CPSCR Review 23 Independent Evaluation Group Annex Table 5: IBRD/IDA Net Disbursements and Charges Summary Report for Russia, FY07-11 (in US$) FY Disb. Amt. Repay Amt. Net Amt. Charges Fees Net Transfer 2007 316,594,706 709,818,274 -393,223,567 257,993,405 2,933,788 -654,150,760 2008 219,788,002 713,650,067 -493,862,065 250,572,319 2,437,623 -746,872,008 2009 172,533,998 722,105,483 -549,571,485 150,578,375 1,567,121 -701,716,981 2010 111,613,184 726,114,727 -614,501,544 61,900,972 1,552,187 -677,954,703 2011 127,976,048 724,712,547 -596,736,499 24,250,349 804,407 -621,791,255 Total 631,911,232 2,886,582,825 -2,254,671,593 487,302,015 6,361,338 -2,748,334,946 (2007-2011) Source: WB Loan Kiosk, Net Disbursement and Charges Report as of 10/31/2011. Annex Table 6: Total Net Disbursements of Official Development Assistance and Official Aid: No data are available Annexes CPSCR Review 24 Independent Evaluation Group Annex Table 7: Economic and Social Indicators for Russia and Comparators, 2007 – 2010 Russia Russia China Kazakhstan Poland Mexico ECA World Series Name 2007 2008 2009 2010 Average 2007-2010 Growth and Inflation GDP growth (annual %) 8.5 5.2 -7.8 4.0 2.5 10.8 5.1 4.3 1.0 0.5 1.9 GDP per capita growth (annual %) 8.8 5.4 -7.7 4.1 2.6 10.3 3.4 4.3 -0.2 0.1 0.74 GNI per capita, PPP (current international $) 16,400.0 19,680.0 18,260.0 19,190.0 18,382.5 6,572.5 10,005.0 17,740.0 14,097.5 23,754.7 10,645.0 GNI, Atlas method (current US mil. $) 1,078,377.6 1,366,396.7 1,317,750.1 1,404,178.9 1,291,675.8 4,469,890.3 100,860.7 441,259.4 1,011,548.0 20,290,391.5 58,359,791.8 Inflation, consumer prices (annual %) 9.0 14.1 11.7 6.9 10.4 3.3 10.6 3.3 4.6 .. .. Composition of GDP (%) Agriculture, value added (% of GDP) 4.4 4.4 4.7 .. 4.5 10.3 5.9 3.8 3.9 1.9 2/ 2.9 3/ Industry, value added (% of GDP) 36.4 35.9 32.8 .. 35.1 46.4 41.6 31.1 35.1 26.2 2/ 27.3 3/ Services, etc., value added (% of GDP) 59.1 59.7 62.5 .. 60.4 43.3 52.4 65.1 61.0 71.9 2/ 69.7 3/ Gross fixed capital formation (% of GDP) 21.0 22.2 21.6 23.8 22.2 42.1 28.7 20.7 21.2 20.2 2/ 20.9 2/ Gross domestic savings (% of GDP) 32.8 34.7 26.3 31.0 31.2 51.0 44.4 20.1 22.2 21.7 2/ 21 2/ External Accounts Exports of goods and services (% of GDP) 30.2 31.3 28.0 28.7 29.5 32.4 48.4 37.7 28.3 38.8 2/ 27.6 2/ Imports of goods and services (% of GDP) 21.5 22.1 20.5 20.5 21.2 26.0 35.1 39.4 29.9 37.4 2/ 27.8 2/ Current account balance (% of GDP) 6.0 6.2 4.0 4.8 5.2 7.4 -1.0 -5.3 -0.9 .. .. External debt (% of GDP) 29.1 24.9 31.9 .. 28.6 9.2 1/ 103.8 2/ 55.6 2,5/ 20.1 1/ .. .. Total debt service (% of GNI) 3.2 4.2 5.7 .. 4.4 0.8 1/ 32.9 2/ .. 4.1 1/ .. .. Total reserves in months of imports 16.0 10.7 16.1 14.1 14.2 20.1 4.3 4.1 3.7 6.0 12.8 Fiscal Accounts Revenue, excluding grants (% of GDP) 31.3 33.7 35.7 .. 33.6 20 5/ 12.2 2/ 31.5 2/ 22.1 5/ .. .. Expenditure (% of GDP) 23 21.5 31.1 .. 25.2 21.1 5/ 15.2 2/ 35 2/ 25.1 5/ .. .. Overall Balance (% of GDP) 8.3 12.2 4.6 .. 8.4 -1.2 5/ -3.0 2/ -3.5 2/ -3.0 5/ .. .. Central Government Debt (% of GDP) 7.2 6.5 8.7 .. 7.5 17.8 5/ 7.0 2/ 45.2 2/ 42.1 4, 5/ .. .. Social Indicators Health Life expectancy at birth, total (years) 67.5 67.8 68.6 .. 68.0 72.8 1/ 67.3 1/ 75.5 1/ 76.2 1/ 75.1 1/ 69.1 1/ Immunization, DPT (% of children ages 12-23 months) 98.0 98.0 98.0 .. 98.0 95.7 1/ 96.7 1/ 99.0 1/ 94.3 1/ 95.6 1/ 81.5 1/ Improved sanitation facilities (% of population with access) .. 87.0 .. .. 87.0 55 1/ 97 1/ 90.0 1/ 85.01/ 94.1 1/ 60.6 1/ Improved water source (% of population with access) .. 96.0 .. .. 96.0 89 1/ 95 1/ 100.0 1/ 94 .01/ 98.0 1/ 86.8 1/ Mortality rate, infant (per 1,000 live births) 11.4 10.6 9.8 9.1 10.2 17.3 30.3 5.5 1/ 15.3 12.6 42.5 Population Population, total (in million) 142.1 142.0 141.9 141.8 141.9 1,328.1 15.8 38.1 111.3 885.1 6,725.2 Population growth (annual %) -0.3 -0.1 -0.1 -0.1 -0.1 0.5 2/ 1.6 0.0 1.3 0.4 1.2 Urban population (% of total) 72.9 72.8 72.8 72.8 72.8 43.6 58.1 61.3 77.4 69.8 50.2 Education School enrollment, preprimary (% gross) 89.4 90.1 .. .. 89.7 44.4 2/ 43.0 2/ 61.0 3/ 113.8 3/ 73.4 3/ 44.7 2/ School enrollment, primary (% gross) 96.8 96.8 .. .. 96.8 112.7 2/ 107.8 96.9 2/ 114.6 2 101.6 2/ 106.6 2/ School enrollment, secondary (% gross) 84.0 84.8 .. .. 84.4 76.1 2/ 94.5 99.5 2/ 89.1 2/ 96.2 2/ 67.4 2/ Source: WB World Development Indicators for all indicators excluding those noted. 1/ The data are presented with the same frequency as for Russia. 2/ 2010 data are missing. 3/ 2009 and 2010 data are missing. 4/ Gross Public Debt 5/ 2011 Article 4 Consultation, IMF Annexes CPSCR Review Independent Evaluation Group Annex Table 8: Russia - Millennium Development Goals 1990 1995 2000 2009 Goal 1: Eradicate extreme poverty and hunger Employment to population ratio, 15+, total (%) 62 61 61 60 Employment to population ratio, ages 15-24, total (%) 52 50 47 45 Income share held by lowest 20% .. .. .. .. Malnutrition prevalence, weight for age (% of children under 5) .. .. 25 22.4 Poverty gap at $1.25 a day (PPP) (%) .. .. .. .. Poverty headcount ratio at $1.25 a day (PPP) (% of population) .. .. .. .. Prevalence of undernourishment (% of population) 20 15 14 14 Vulnerable employment, total (% of total employment) .. .. .. .. Goal 2: Achieve universal primary education Literacy rate, youth female (% of females ages 15-24) 79 .. 84 86 Literacy rate, youth male (% of males ages 15-24) 88 .. 90 92 Persistence to last grade of primary, total (% of cohort) .. .. .. .. Primary completion rate, total (% of relevant age group) 79 .. 82 88 Total enrollment, primary (% net) .. .. 84 90 Goal 3: Promote gender equality and empower women Proportion of seats held by women in national parliaments (%) 13 12 14 19 Ratio of female to male primary enrollment (%) 89 .. 92 97 Ratio of female to male secondary enrollment (%) 83 .. 92 96 Ratio of female to male tertiary enrollment (%) .. .. 99 108 Share of women employed in the nonagricultural sector (% of total nonagricultural employment) 34.5 37 36.5 .. Goal 4: Reduce child mortality Immunization, measles (% of children ages 12-23 months) 73 74 72 82 Mortality rate, infant (per 1,000 live births) 64 61 55 43 Mortality rate, under-5 (per 1,000) 92 88 79 61 Goal 5: Improve maternal health Adolescent fertility rate (births per 1,000 women ages 15-19) .. .. 60 51 Births attended by skilled health staff (% of total) .. .. 62 66 Contraceptive prevalence (% of women ages 15-49) 57 .. 61 61 Maternal mortality ratio (modeled estimate, per 100,000 live births) 400 370 340 260 Pregnant women receiving prenatal care (%) .. .. 75 82 Unmet need for contraception (% of married women ages 15-49) .. .. .. .. Goal 6: Combat HIV/AIDS, malaria, and other diseases Children with fever receiving antimalarial drugs (% of children under age 5 with fever) .. .. .. .. Condom use, population ages 15-24, female (% of females ages 15-24) .. .. .. .. Condom use, population ages 15-24, male (% of males ages 15-24) .. .. .. .. Incidence of tuberculosis (per 100,000 people) 130 130 140 140 Prevalence of HIV, female (% ages 15-24) .. .. .. 0.7 Prevalence of HIV, male (% ages 15-24) .. .. .. 0 Prevalence of HIV, total (% of population ages 15-49) 0.3 0.7 0.9 0.8 Tuberculosis case detection rate (all forms) 43 47 45 61 Goal 7: Ensure environmental sustainability CO2 emissions (kg per PPP $ of GDP) 0.9 0.7 0.6 .. CO2 emissions (metric tons per capita) 4.3 4.1 4.1 4.6 Forest area (% of land area) 31 31 31 30 Improved sanitation facilities (% of population with access) 52 55 57 61 Improved water source (% of population with access) 77 80 83 87 Marine protected areas (% of total surface area) .. .. .. 2 Terrestrial protected areas (% of total surface area) .. .. .. 14.4 Goal 8: Develop a global partnership for development Debt service (PPG and IMF only, % of exports, excluding workers' remittances) .. .. .. .. Internet users (per 100 people) 0.1 0.8 6.8 23.9 Mobile cellular subscriptions (per 100 people) 0 2 12 61 Net ODA received per capita (current US$) 11 10 8 19 Telephone lines (per 100 people) 10 12 16 19 Other Fertility rate, total (births per woman) 3.3 2.9 2.7 2.5 GNI per capita, Atlas method (current US$) 4064 5061 5293 8728 GNI, Atlas method (current US$) (billions) 21453.2 28793.6 32210.7 59132.6 Gross capital formation (% of GDP) 23.4 22.3 22.3 19 Life expectancy at birth, total (years) 65 66 67 69 Literacy rate, adult total (% of people ages 15 and above) 76 .. 82 83 Population, total (millions) 5278.9 5689.1 6085 6775.2 Trade (% of GDP) 38 41.8 48.8 46.7 Source: A26 database as of 10/31/2011. Annexes CPSCR Review 26 Independent Evaluation Group Annex Table 9: List of IFC’s Investments in the Russian Federation that were active during FY09-11 (US$’000) Project Project Name First Project Closure Primary Sector Projec Net Net Total net ID Cmt Status FY t Size Equity Loans commitment FY Committed pre-FY09, but active during FY09-11 7673 Mosenergo 1998 Closed 2009 Electric Power 32,000 0 20,000 20,000 8447 Ramstore 1999 Closed 2009 Wholesale and Retail Trade 132,126 0 30,500 30,500 10165 Ramstore II 2001 Closed 2009 Wholesale and Retail Trade 126,126 0 30,000 30,000 10441 Ruscam 2002 Closed 2011 Nonmetallic Mineral Product 32,415 0 13,000 13,000 Manufacturing 10600 Swedwood 2002 Closed 2009 Industrial & Consumer 47,200 0 5,640 5,640 Tichvin Products 11166 KMB Bank 2002 Closed 2009 Finance & Insurance 7,000 0 7,000 7,000 11288 ZAO StoraEnso II 2002 Closed 2009 Pulp & Paper 15,100 0 7,000 7,000 11293 Ramstore III 2003 Closed 2009 Wholesale and Retail Trade 209,446 0 40,000 40,000 11698 Komi Aluminium 2005 Closed 2009 Oil, Gas and Mining 250,000 0 15,000 15,000 11728 NBD II 2003 Closed 2010 Finance & Insurance 7,000 0 7,000 7,000 11767 Ruscam 2003 Closed 2011 Nonmetallic Mineral Product 27,000 0 10,000 10,000 Expansion Manufacturing 20561 UralTransBank 2003 Closed 2010 Finance & Insurance 10,000 0 7,500 7,500 20709 BCEN-EuroBank 2003 Closed 2009 Finance & Insurance 100,000 0 100,000 100,000 21046 Novatek Gas 2005 Closed 2010 Oil, Gas and Mining 35,000 35,000 0 35,000 21592 Delta Leasing 2004 Closed 2009 Finance & Insurance 4,000 0 4,000 4,000 21643 Ruscam III 2004 Closed 2011 Nonmetallic Mineral Product 35,000 0 17,500 17,500 Manufacturing 21657 UralSib Bank 2006 Closed 2010 Finance & Insurance 30,000 0 30,000 30,000 21842 Lebedyansky 2004 Closed 2009 Food & Beverages 90,500 0 35,000 35,000 21844 Ramstore IV 2006 Closed 2009 Wholesale and Retail Trade 103,700 0 40,000 40,000 21928 SocGen Vostok 2004 Closed 2011 Finance & Insurance 75,000 0 75,000 75,000 22453 NDCO RWMN 2005 Closed 2009 Finance & Insurance 1,000 0 1,000 1,000 22492 Moscow Credit Bk 2005 Closed 2010 Finance & Insurance 10,000 0 10,000 10,000 22552 BRL 2006 Closed 2010 Transportation and 535,000 7,500 37,164 44,664 Warehousing 22624 Center-Invest II 2005 Closed 2011 Finance & Insurance 10,000 0 10,000 10,000 23270 Eurosibtrans 2005 Closed 2011 Transportation and 30,000 0 30,000 30,000 Warehousing 23501 BSGV Leasing 2004 Closed 2010 Finance & Insurance 19,450 0 19,450 19,450 23941 Alliance Oil Co. 2006 Closed 2010 Chemicals 100,200 0 25,000 25,000 24100 EastWestGold 2006 Closed 2009 Oil, Gas and Mining 766,400 0 39,000 39,000 24319 ING Russia Life 2007 Closed 2010 Finance & Insurance 30,000 14,004 0 14,004 24435 NBD III 2006 Closed 2011 Finance & Insurance 5,000 0 5,000 5,000 24542 RSB IV 2006 Closed 2009 Finance & Insurance 125,000 0 64,028 64,028 24564 PIP-Vladpivo 2006 Closed 2009 Food & Beverages 57,949 5,310 14,836 20,146 24567 Primsotsbank 2007 Closed 2010 Finance & Insurance 12,590 5,396 5,543 10,938 24638 Eurosib Terminal 2006 Closed 2011 Transportation and 181,935 0 18,764 18,764 Warehousing 24723 Delta Leasing II 2006 Closed 2012 Finance & Insurance 5,959 0 6,212 6,212 24976 Rusfinance Bank 2007 Closed 2009 Finance & Insurance 49,278 0 50,399 50,399 25021 Sodrugestvo 2008 Closed 2011 Agriculture and Forestry 421,580 50,000 0 50,000 25345 MDM Bank 2007 Closed 2010 Finance & Insurance 100,000 0 100,000 100,000 25375 RSF-1 2007 Closed 2010 Finance & Insurance 50,000 0 25,361 25,361 25758 PIP-Rights Issue 2007 Closed 2009 Food & Beverages 280 280 0 280 25774 PM Russia 2007 Closed 2009 Information 450,000 0 50,000 50,000 25914 Aricom 2007 Closed 2009 Oil, Gas and Mining 652,000 20,000 0 20,000 25982 MDM Bank Equity 2008 Closed 2010 Finance & Insurance 184,000 183,999 0 183,999 26657 FEBC-R.Issue #2 2008 Closed 2009 Food & Beverages 340 340 0 340 3941 FIRST NIS FUND 1995 Active Collective Investment Vehicles 85,420 15,000 0 15,000 4695 Russ Tech Fnd 1996 Active Collective Investment Vehicles 2,000 1,000 0 1,000 Annexes CPSCR Review 27 Independent Evaluation Group Project Project Name First Project Closure Primary Sector Projec Net Net Total net ID Cmt Status FY t Size Equity Loans commitment FY 10407 NMC 2001 Active Health Care 10,050 0 2,100 2,100 10586 BVF 2001 Active Collective Investment Vehicles 15,000 15,000 0 15,000 10707 Delta Credit 2002 Active Finance & Insurance 20,000 0 20,000 20,000 10991 Ru-Net 2003 Active Information 6,000 3,000 2,000 5,000 11473 Medicina 2008 Active Health Care 97,000 0 20,135 20,135 11590 Quadriga Capital 2005 Active Collective Investment Vehicles 20,000 20,000 0 20,000 11660 Pilkington Rus 2004 Active Nonmetallic Mineral Product 251,933 0 47,570 41,402 Manufacturing 20359 DeltaCredit Bank 2003 Active Finance & Insurance 60,000 0 54,000 54,000 20425 Kronostar 2004 Active Industrial & Consumer 535,249 0 49,338 49,338 Products 20491 Cinema Park 2006 Active Wholesale and Retail Trade 127,700 0 20,000 20,000 20618 RZB Russia 2003 Active Finance & Insurance 80,000 0 11,500 11,500 21396 VSC 2005 Active Transportation and 45,500 0 18,428 18,428 Warehousing 21422 Severstaltrans 2004 Active Transportation and 40,000 0 40,000 40,000 Warehousing 21506 Russkiy Mir 2004 Active Transportation and 72,700 0 15,000 15,000 Warehousing 23114 KuAz 2005 Active Chemicals 91,900 0 15,000 15,000 23201 Europlan II 2007 Active Finance & Insurance 19,964 0 20,689 20,689 23309 Russia EnEff 2006 Active Finance & Insurance 9,000 0 4,000 4,000 23497 RussiaPartnersII 2005 Active Collective Investment Vehicles 10,000 10,000 0 10,000 23864 Petropav Gold 2005 Active Oil, Gas and Mining 53,000 15,000 0 15,000 23870 Russkiy Mir II 2005 Active Transportation and 425,517 0 20,483 20,483 Warehousing 23871 Grand Hotel 2005 Active Accommodation & Tourism 65,000 0 15,000 15,000 Services 23881 Moscow Credit- 2006 Active Finance & Insurance 5,000 0 5,000 5,000 LN 23887 BVPEF III 2005 Active Collective Investment Vehicles 12,500 12,500 0 12,500 23981 OOO Kronospan 2005 Active Industrial & Consumer 92,869 0 90,486 90,486 PB Products 24003 Absolut Bank 2006 Active Finance & Insurance 25,000 10,000 15,000 25,000 24019 Kronostar II 2005 Active Industrial & Consumer 45,000 0 45,000 45,000 Products 24127 AirTaxi 2006 Active Transportation and 81,707 0 8,000 8,000 Warehousing 24236 Rus Mortgage 2007 Active Finance & Insurance 35,000 0 19,370 19,370 Sec 24286 Forus Bank 2006 Active Finance & Insurance 6,309 0 6,238 6,238 24361 OMK-Vyksa 2006 Active Primary Metals 60,000 0 60,000 60,000 24389 Russkiy Mir IIb 2005 Active Transportation and 54,483 0 24,517 24,517 Warehousing 24436 Locko Bank 2006 Active Finance & Insurance 30,503 15,653 10,791 26,445 24492 Trio 2006 Active Transportation and 97,621 0 20,000 20,000 Warehousing 24582 Chuvash 2006 Active Utilities 52,069 0 8,395 8,395 Republic 24954 AB Rights Issue 2006 Active Finance & Insurance 3,500 3,268 0 3,268 25020 Petropav Option 2006 Active Oil, Gas and Mining 17,362 17,362 0 17,362 25082 GTFP CBM 2006 Active Finance & Insurance 70,000 0 403,564 403,564 25092 GTFP Absolut Bk 2006 Active Finance & Insurance 25,000 0 37,288 37,288 25119 Absolut Tier 2 2008 Active Finance & Insurance 30,000 19,667 0 19,667 25128 GTFP Locko 2006 Active Finance & Insurance 20,000 0 112,484 112,484 Bank 25564 NBD SME/EE 2008 Active Finance & Insurance 15,000 0 15,000 15,000 25573 CapMan Russia 2007 Active Collective Investment Vehicles 19,043 13,965 0 13,965 25789 AB RI II 2007 Active Finance & Insurance 4,500 4,500 0 4,500 Annexes CPSCR Review 28 Independent Evaluation Group Project Project Name First Project Closure Primary Sector Projec Net Net Total net ID Cmt Status FY t Size Equity Loans commitment FY 25835 Chuvash Roads 2007 Active Transportation and 161,743 0 50,261 50,261 Warehousing 25996 Daido Metal 2008 Active Industrial & Consumer 21,247 0 5,240 5,240 Products 26024 RBRU Auto Sec 2007 Active Finance & Insurance 12,000 0 12,000 12,000 26119 NMC II 2008 Active Health Care 54,039 0 12,500 12,500 26131 Brunswick II 2008 Active Transportation and 431,500 0 80,000 80,000 Warehousing 26137 Locko bank - RI 2008 Active Finance & Insurance 3,484 3,484 0 3,484 26199 KuAz II 2008 Active Chemicals 20,000 20,000 0 20,000 26363 Petropavlovsk K 2008 Active Transportation and 28,675 0 28,675 28,675 Warehousing 26427 BGK 2008 Active Agriculture and Forestry 215,000 50,000 30,000 80,000 26442 Vostok 2008 Active Oil, Gas and Mining 380,000 20,000 0 20,000 26462 Home Center 2008 Active Wholesale and Retail Trade 105,900 0 10,000 10,000 26756 Concordia Incr. 2008 Active Food & Beverages 91,600 0 15,000 15,000 27039 Locko bank - RI2 2008 Active Finance & Insurance 3,723 3,723 0 3,723 27335 Vostok Right Iss 2008 Active Oil, Gas and Mining 10,000 10,000 0 10,000 Subtotal 604,949 2,505,949 3,104,730 Project Project Name First Project Closure Primary Sector Project Net Net Total net ID Cmt Status FY Size Equity Loans commitment FY Committed in FY09-11 26900 MDM A+B Loan 2009 Closed 2010 Finance & Insurance 535,000 0 35,000 35,000 27245 RPSB Equity 2009 Closed 2011 Finance & Insurance 22,000 21,521 0 21,521 27620 South Region EQ 2009 Closed 2010 Finance & Insurance 1,500 1,149 0 1,149 25353 GTFP RSB Russia 2009 Active Finance & Insurance 5,000 0 1,488 1,488 26104 GTFP MDM Bank 2009 Active Finance & Insurance 17,500 0 74,326 74,326 26269 ATB Far East Rus 2009 Active Finance & Insurance 40,260 20,130 22,287 42,417 26654 Asteros Group 2010 Active Professional, Scientific 58,900 2,500 0 2,500 and Technical Services 26777 Nitol Solar 2009 Active Chemicals 699,500 49,857 0 49,857 26792 Kronostar III 2009 Active Industrial & Consumer 175,000 0 30,000 30,000 Products 26893 MRIF 2009 Active Collective Investment 100,000 100,000 0 100,000 Vehicles 26901 Locko A+B Loan 2009 Active Finance & Insurance 65,000 0 20,000 20,000 27045 GTFP ATB 2009 Active Finance & Insurance 7,500 0 35,939 35,939 27111 GTFP URALTRNSBK 2010 Active Finance & Insurance 2,500 0 2,279 2,279 27379 Megalogix 2009 Active Construction and Real 160,416 0 40,000 40,000 Estate 27465 Avtokran 2010 Active Industrial & Consumer 95,694 0 27,085 27,085 Products 27542 Ufa Vodokanal 2010 Active Utilities 35,768 0 17,214 17,214 27626 Energomera 2010 Active Industrial & Consumer 20,000 0 10,000 10,000 Products 27777 Mytischi heating 2009 Active Other (For Non- 24,585 0 9,734 9,734 Investment Projects) 27781 Mariy El 2009 Active Transportation and 30,078 0 13,416 13,416 Warehousing 27786 Chuvash Health 2009 Active Other (For Non- 5,573 0 5,957 5,957 Investment Projects) 27869 Kulon Yugros 2010 Active Transportation and 44,061 0 14,444 14,444 Warehousing 27894 GTFP NBD 2010 Active Finance & Insurance 3,500 0 247 247 27928 Kuaz Energy Eff. 2009 Active Chemicals 39,600 0 20,000 20,000 28037 FactorRus 2010 Active Finance & Insurance 15,000 5,000 5,000 10,000 Annexes CPSCR Review 29 Independent Evaluation Group Project Project Name First Project Closure Primary Sector Project Net Net Total net ID Cmt Status FY Size Equity Loans commitment FY 28077 Vyksa II 2010 Active Primary Metals 70,000 0 70,000 70,000 28133 GTFP TransCapBk 2009 Active Finance & Insurance 20,000 0 44,142 44,142 28134 GTFP RZB Russia 2009 Active Finance & Insurance 13,027 0 18,814 18,814 28218 Pulkovo Airport 2010 Active Transportation and 1,693,188 0 94,315 94,315 Warehousing 28345 GTFP Bank SP 2009 Active Finance & Insurance 20,000 0 25,510 25,510 28348 GTFP RosEvroBank 2010 Active Finance & Insurance 20,000 0 15,197 15,197 28453 Borets 2010 Active Oil, Gas and Mining 200,000 0 50,000 50,000 28498 BAC Loan 2009 Active Professional, Scientific 20,000 0 20,000 20,000 and Technical Services 28578 Logopark Don 2010 Active Transportation and 132,932 0 30,000 30,000 Warehousing 28618 Forus Swap 2010 Active Finance & Insurance 2,000 0 2,000 2,000 28633 CI RREEF-Agri 2010 Active Finance & Insurance 30,986 0 30,986 30,986 28667 GTFP Center-Inv 2010 Active Finance & Insurance 5,000 0 591 591 28919 Mariy El II 2010 Active Transportation and 20,003 0 20,003 20,003 Warehousing 29035 Globaltrans II 2010 Active Transportation and 248,000 0 30,000 30,000 Warehousing 29066 GTFP PSB 2010 Active Finance & Insurance 55,000 0 77,581 77,581 29069 BLL Rights Issue 2010 Active Transportation and 150,000 20,000 0 20,000 Warehousing 29161 Russian Hotel 2010 Active Construction and Real 130,923 2,975 30,450 33,425 Estate 29189 TCB Syndication 2010 Active Finance & Insurance 90,000 0 30,000 30,000 29370 CB Otkritie 2011 Active Finance & Insurance 100,000 100,000 0 100,000 29451 CBM A + B Loan 2010 Active Finance & Insurance 150,000 0 40,000 40,000 29507 Locko A+B (EE) 2011 Active Finance & Insurance 50,000 0 19,600 19,600 29666 Mariy El 2011 2011 Active Transportation and 30,505 0 22,519 22,519 Warehousing 29744 BWL 2011 Active Transportation and 450,000 0 50,000 50,000 Warehousing 29810 TCB Swap 2010 Active Finance & Insurance 5,000 0 5,000 5,000 29827 Orient Expr. Bk 2011 Active Finance & Insurance 75,000 0 75,000 75,000 30236 Equity TCB 2011 Active Finance & Insurance 60,000 41,800 18,200 60,000 30244 BLL CI 2011 Active Transportation and 25,000 25,000 0 25,000 Warehousing 30369 CPLF - Mytischi 2011 Active Other (For Non- 0 5,287 5,287 Investment Projects) 30422 Monocrystal II 2011 Active Industrial & Consumer 29,157 0 30,000 30,000 Products 30781 Idavang 2011 Active Agriculture and Forestry 24,964 24,964 0 24,964 31060 ZAO Energomera 2011 Active Industrial & Consumer 0 20,000 20,000 Products Subtotal 414,896 1,259,611 1,674,507 Grand Total 1,019,845 3,765,560 4,779,238 Source: IFC MIS as of June 2011 Annexes CPSCR Review 30 Independent Evaluation Group Annex Table 10. List of IFC’s Advisory Services in Russia, FY09-11 Project Project Name Start End Project Primary Business Line Total Funds, ID FY FY Status US$ Advisory Services operations approved pre-FY09, but active during FY09-11 521793 Developing the Legal and Regulatory FY07 FY09 Closed Sustainable Business 739,000 Framework for Wind Power in Russia Advisory 537485 Russia Primary Mortgage Development FY05 FY09 Closed Access To Finance 3,645,975 Project 537489 Russia Far East Business Development FY05 FY09 Closed Sustainable Business 3,343,268 Project (Magadan) Advisory 549485 Russia Banking Advisory Project FY07 FY10 Closed Access To Finance 1,465,211 551525 Russia--removing admin. barriers for FY07 FY10 Closed Investment Climate 688,581 investment, business development in republics of N. Caucasus 551585 A Chance to Work - Extension FY07 FY10 Closed Sustainable Business 1,124,883 Advisory 553547 SRsp Russkiy Mir FY07 FY09 Closed Sustainable Business 61,256 Advisory 555105 Securitization Advisory TA - Russian FY07 FY09 Closed Access To Finance 375,000 Federal Service for Financial Markets 555505 Subnational Doing Business in Russia FY07 FY10 Closed Investment Climate 464,299 555525 Russia Insurance Glossary FY07 FY09 Closed Access To Finance 95,000 Subtotal $12,002,473 Advisory Services operations approved in FY09-11 27441 Russian Federation -- BEE improvement in FY09 FY10 Closed Investment Climate 17,000 Republic of Tatarstan 562027 Russia Energy Efficiency Study (sub- FY09 FY10 Closed Sustainable Business 363,646 national level) Advisory 563448 Russia Power Sector FY09 FY10 Closed Public-Private 400,000 Partnerships Transaction Advisory 571107 Russia Renewable Energy FY10 FY15 Active Sustainable Business 10,300,000 Advisory 574447 Russia Residential Energy Efficiency FY10 FY16 Active Access To Finance 4,912,600 Program 575387 Russia FM Crisis Management Project FY10 FY12 Active Access To Finance 888,740 Subtotal $16,881,986 Grand Total $28,884,459 Source: Source: IFC, June 2011 Annexes CPSCR Review 31 Independent Evaluation Group Annex Table 11: Summary of Achievements of the CPS Objectives CPS 07-09: Pillar 1 Actual Results Comments Diversifying the Economy for Sustainable Development and (as of current month year) Growth Objectives 1. Contribute to macroeconomic policy and the effective management of Russia’s large external inflows 2. Continue investment climate monitoring and policy advice, while providing direct support to the private sector 3. Support Government investment and PPPs for growth and diversification 4. Work with regions to identify engines of growth, develop growth strategies and remove barriers to growth, while supporting investments in priority areas at the regional level -Major 1. Contribute to macroeconomic policy and the effective management of Russia’s large external inflows Outcome Measures Create Fund for Future Generations according to The Stabilization Fund was divided Modest Progress. world best practices into the Reserve Fund (to insure the Source: CASCR. budget against oil price fluctuations) and the Fund for Future Generations The extent to which world best practices was (invested in longer-term assets). follows is unclear. 2. Continue investment climate monitoring and policy advice, while providing direct support to the private sector Ensure strong progress in land registration and The land market is underdeveloped Modest Progress. cadastre listings due to weak protection of property Source: CASCR rights. The International Property Rights Index slightly improved from International Property Right Index 2008 and 4.1 over 10 in 2008 to 4.6 in 2010. 2011 Reports. The average time for completion of transactions in immovable property was reduced to 51 days in 2009 (Baseline (2004): 4 months). Regulatory changes have had considerable effect, but reorganization and adaptation to new technologies in offices moderated (and sometimes reversed) time savings. The average time a client spends in a cadastre office (per visit) decreased to 59 minutes in 2009 (Baseline (2004): 2 hours). Seventy percent of surveyed clients (2009) were satisfied with the operation of cadastre offices. Increase in availability of finance for Russian Domestic credit available to the Modest Progress. entrepreneurs private sector increased from 38.8 Source: CASCR. percent of GDP in 2007 to 45.1 percent in 2010, albeit less than the From 2006 to 2010, IFC’s portfolio clients in the ratio of broad money to GDP that banking sector provided around 360,000 SME went from 37 percent to 48 percent loans and held an outstanding SME portfolio of in the same period. US$4.6 billion at the end of 2010. IFC’s portfolio of clients provided approximately 168,000 microfinance loans over the same period, and held an outstanding microfinance portfolio of almost US$23 million at the end of 2009. However, NPLs continue to constrain lending to corporations and SMEs. Credit growth in 2010 is lower than in 2007. Implement financial sector regulation reform There is no information on this Unknown Progress. outcome. Source: CASCR. WBG assistance focused on automation of the securities market regulator, strengthening the central bank’s oversight analytical capabilities Annexes CPSCR Review 32 Independent Evaluation Group CPS 07-09: Pillar 1 Actual Results Comments Diversifying the Economy for Sustainable Development and (as of current month year) Growth and monitoring the payments system. However, capital markets legislation was enacted to stimulate the development of the domestic capital markets and strengthen investor protection through increased transparency and effective market surveillance (e.g., Law on insider-trading and price manipulation; increased protection of bond holders’ rights in the eventuality of default; amendments to the Securities Market Law on disclosure to strengthen transparency, etc). 3. Support Government investment and PPPs for growth and diversification Attract substantial private investment to non-oil Gross FDI inflows from 2005 -2010 Negligible Progress. tradable sectors averaged a low 1.5 percent of GDP, Source: CASCR. with only 21 percent of these funds going to non-energy manufacturing. Increase innovation rates Negligible Progress. Even though the Global Source: CASCR. Competitiveness Index of Russia produced by the World Economic World Economic Forum. Forum improved from 4.19 in 2007- 2008 to 4.24 2010-2011, the sub- Patent applications of Russian residents index for innovation deteriorated decreased from 27,884 (2006) to 25,598 (2009), from 3.50 in 2007-2008 to 3.36 in while non-resident patent applications increased 2010-2011. from 9,807 (2006) to 12,966 (2009). Ensure successful formation of Public-Private PPP for infrastructure development Modest Progress. Partnerships (PPP) are lagging. The financial crisis and Source: CASCR. restrictions in the Federal Concession Law reduced the formation of PPPs and use of the Federal Investment Fund. Four FBS agreements with St.Petersburg laid the basis for Russia’s first concessions in the transport sector. Pulkovo Airport reached financial closure and raised Euro 1.1 billion in the first major PPP in Russia (IFC Euro 170 million). Create key (with economic impact) infrastructure in The Moscow Urban Transport – Substantial Progress. the context of Bank projects Bridge reconstruction program Source: CASCR. contributed to the construction of six pedestrian underpasses and The Moscow Urban Transport Project also established a Traffic Management supported traffic law enforcement measures Center (it continues to operate after and preparation of feasibility studies, in project completion). particular for the Moscow Small Ring Railway Sub-national lending has helped project that is now being developed by the city repair and upgrade regional and of Moscow in conjunction with the RZD – municipal health services, district National Railways Company. heating, water/wastewater infrastructure and road networks, including rural road networks, improving delivery of social services and facilitating access to markets. Attract power sector investment resources at good Most of thermal generation assets Substantial Progress. terms (under guarantee) and regional power supply Source: CASCR. companies have been privatized. Annexes CPSCR Review 33 Independent Evaluation Group CPS 07-09: Pillar 1 Actual Results Comments Diversifying the Economy for Sustainable Development and (as of current month year) Growth Many power sector companies are floated on the Russian stock exchange. Investments in the power sector are mostly funded through depreciation charges and commercial borrowing. 4. Work with regions to identify engines of growth, develop growth strategies, and remove barriers to growth, while supporting investments in priority areas at the regional level Improve climate for growth and investment in In 2010 the number of SMEs in St. Modest Progress. selected regions with Bank support (development Petersburg, where IBRD was active Source: CASCR. strategies) with support, reached 228,000 (Baseline (2003): 97,000; Target The spatial dispersion continues to impede (2010): 189,000) and private capture of agglomeration economies in Russia. transactions for land and real estate A national regional strategy for promoting exceeded 210,000 (Baseline (2003): growth points has not been adopted so far. 90,400; Target (2010: 127,200). Ensure progress in housing reform (utilities prices, This outcome is moved to Pillar 3. competition in the industry, etc.) in regions participating in housing and communal service project or receiving IFC support Improve regional trade through reduction in There is no progress on this Negligible Progress. transportation logistics costs outcome. Source: CASCR. IBRD supported benchmarking of regional authorities on ease of trading across borders, which highlighted constraints. IBRD dialogue with Avtodor (new agency for federal toll road construction and maintenance) remains in the early stages. The Customs Development Project targeted a reduction in compliance costs for border crossings. Ongoing P078420 Cadastre Development Project Approved FY06. Closed FY11. Latest Internal Rating( IR): Satisfactory pre P042622 Capital Market Development Project Approved FY96. Closed FY11. IEG Rating: Moderately Satisfactory CAS/CPS (TAL) 07-10 P046061 Moscow Urban Transp Approved FY01. Closed FY08. IEG Rating: Satisfactory Support P064328 Northern Restructuring Project (SIL) Approved FY01. Closed FY 2010. IR: Moderately Unsatisfactory P069063 St. Petersburg Economic Development Approved FY03. Active. Latest IR: Satisfactory Project P072960 Customs Development Project (SIL) Approved FY03. Active. Latest IR: Satisfactory P050891 Electricity Sector Reform (TAL) Approved FY97. Closed FY07. IR: Satisfactory New Lending Approved FY10. Active. Support P122493 FBS to Central Bank of Russia Non- Lending Support (Grants and Special Financing NA Projects) Planned P104863 Financial Sector Assessment Program Delivered to Client FY08. AAA update (FSAP) P108310 Post FSAP TA on Banking Supervision, Delivered to Client FY08. Insurance and Pension P107247 Long Term Fiscal Risks and Fiscal Delivered to Client FY10. Sustainability Annexes CPSCR Review 34 Independent Evaluation Group CPS 07-09: Pillar 1 Actual Results Comments Diversifying the Economy for Sustainable Development and (as of current month year) Growth P109701 TA Regional Development Strategies Delivered to Client FY09. P076129 Country Economic Memorandum Regional Development Delivered to Client FY08. P109701 TA Regional Dev. Strategies Delivered to Client FY09. P109594 FBS Urban PPP Unit in St. Petersburg Delivered to Client FY08. P112597 Public Expenditure Review Delivered to Client FY11. Additional P096612 Energy Efficiency Study in Russia Delivered to Client FY08. AAA P119392 Public Expenditure Management and Efficiency TA Delivered to Client FY11. P108962 Export Diversification, Competition and Delivered to Client FY11. Innovation P123690 RU Innovation EFO Delivered to Client FY11. P125925 FBS Nurturing Innovation Management in Russia Delivered to Client FY11. P105815 Sub-national Doing Business TA Delivered to Client FY10. P108703/704 FBS Transport Nadzemny Express PPP St. Petersburg Delivered to Client FY08 and FY09. P109067 FBS Western High Speed Diameter/Orlovski Tunnel Delivered to Client FY08. P109593 FBS Transport Pulkovo Airport Expansion PPP St. Petersburg Delivered to Client FY08. P110746 FBS Transport Kazan International Airport Delivered to Client FY08. P114071 FBS Transport Volgograd Feasibility By- pass Delivered to Client FY09. Annexes CPSCR Review 35 Independent Evaluation Group CPS 07-09: Pillar 2 Actual Results Comments Improve Public Sector Management and Governance (as of current month year) Objectives 1. Modernize selected public sector institutions 2. Support the government program in administrative reform 3. Step up engagement on judicial reform 4. Support for budgetary reforms 5. Support the reform of local self- government 6. Invest in municipal development 7. Support anti-corruption initiatives -Major Outcome 1. Modernize selected public sector institutions Measures Continue improvements in the quality of Russian WBG engagements supported High Progress. statistics as targeted in Stat projects activities which included: the Source: CASCR. adoption of international standards in statistical products (e.g., national accounts, balance of payments) for improved macro planning and forecasting; integrated processing systems tested in 15 pilot regions; introduction of international standards and methodology (e.g., transition from census-based to integrated census-sampling framework of statistical surveys); establishment of the National Statistical Council (2010) for development of strategic issues and methodology comprised of leading Russian economists and recognized statisticians. 2. Support the government program in administrative reform Realize public administration reform program The quality of public service delivery Modest Progress. for re-organization of apparatus and conversion to has improved, especially in multi- Source: CASCR. new principles functional service centers (MFCs) with 102 MFCs in over 46 regions established between 2007- 2010 leading to waiting time for some administrative services there cut in half. Ensure relatively rapid progress on administrative IBRD directly supported the Substantial Progress. reform in regions where IBRD is engaged Government’s Strategy for Public Source: CASCR. Administration Reform (2008-2010), with priority in Southern and North Caucasus Federal District (least advanced region). IBRD enhanced performance management approaches and supported better linkages between policy priorities and the budget. Selected performance management tools were implemented at the federal and regional level. Performance reporting practices were enhanced by tightening definitions and quality of indicators used by the Ministry of Regional Development to assess performance of regional executive authorities. The functions of the Khanti-Mansiysk Autonomous Okrug Government Annexes CPSCR Review 36 Independent Evaluation Group CPS 07-09: Pillar 2 Actual Results Comments Improve Public Sector Management and Governance (as of current month year) have been reviewed and civil servants trained to apply functional review approaches to improve government performance. IBRD helped to enhance the regulatory environment for businesses, especially competitiveness and SME business environment with improved environment for private sector expansion in St. Petersburg. Regulatory Impact Assessment (RIA) was institutionalized at the federal level and piloted at the sub- national level in North Ossetia Republic. Administrative regulations and service standards for key public services have been improved with IBRD’s help. 3. Step up engagement on judicial reform Ensure progress in judiciary reform in context of Progress is strongest in arbitration Modest Progress. project (information transmission and disclosure) (commercial) courts and weakest in Source: CASCR. Courts of General Jurisdiction. The publication of arbitration court decisions on the unified web-portal has been achieved. The Law on Securing Access to Information on Courts’ Activities (December 2008) now increases information for public and the mass media. There is fragmentation of oversight for judicial reform and weak implementation support, particularly on IT procurement. 4. Support for budgetary reforms Ensure successful realization of 3-year budgetary The MOF introduced three-year High Progress. framework at the federal level budget framework in 2008. Source: CASCR. 5. Support the reform of local self-government Ensure good progress on the development of local In 2009, transition to local self- High Progress. self-government in pilot rural areas (Penza, Adygea, government was completed, creating Source: CASCR. and Perm regions) 10,000 new administrative units. Increase capacity of Municipal Associations in There is no information on this Unknown Progress. Adygea, Penza, and Perm outcome. Source: CASCR. IBRD developed and tested replicable models of capacity building for settlement-level administrators (both elected and appointed) and methodologies for effective public hearings mandated under the new legislation. Increase participation of the population in public There is no information on this Negligible Progress. decision-making in the three regions of the study outcome. Source: CASCR. The quality of local government is highly uneven, training and capacity building programs are insufficient, and programs for support of local initiatives have not been developed, minimizing incentives for inclusion of the population into public decision making and processes of local governance. Annexes CPSCR Review 37 Independent Evaluation Group CPS 07-09: Pillar 2 Actual Results Comments Improve Public Sector Management and Governance (as of current month year) Develop and pilot new modalities of interaction The WB helped design new formats Substantial Progress. between the government and the population in the for interaction between local Source: CASCR. process of public decision-making government officials and the population (to be continued with the help of a US$750,000 JSPF grant to the Perm administration). In pilot rural settlements, 22 local governments/community working groups comprised of settlement administrative staff, elected deputies and community members were formed and trained. 6. Invest in municipal development NA 7. Support anti-corruption initiatives NA Ongoing pre P069063 St. Petersburg Economic Development Approved FY03. Active. Latest IR: Satisfactory CAS/CPS Project (FIL) 07-10 P058587 Regional Fiscal Technical Assistance Approver FY00. Closed FY11. Latest IR: Satisfactory Support Project (TAL) P064508 Treasury Development Project Approved FY02. Active. Latest IR: Satisfactory P066155 Tax Administration Modernization 2 Approved FY03. Closed FY08. IEG Rating: Moderately Satisfactory Project (SIL) P050487 Development of State Statistical System Approved FY99. Closed FY07. IEG Rating: Satisfactory Project (SIL) P072960 Customs Development Project (SIL) Approved FY03. Active. Latest IR: Satisfactory New P106543 WB-DFID Trust Fund “Support to Public Approver FY08. Closed FY11. Lending Administration and Governance in Russia� Support P092429 Second State Statistical Approved FY07. Active. Latest IR: Moderately Satisfactory System (APL) Approved P089733 Judicial Reform Support Project (SIL) Approved FY07. Active. Latest IR: Unsatisfactory Non- Lending Support (Grants and Special Financing Projects) TF090655 Judicial Reform Support Project Approved FY07. Active Latest IR: Unsatisfactory Planned Delivered to Client FY11. AAA P112597 Public Expenditure Review (PER) Additional P110048 TA Advisory Services: Khanti-Mansiysk Delivered to Client FY09. AAA Autonomous Okrug-Yugra P110537 Quality of Local Governance TA financed Delivered to Client FY09. by JSDF P121856 FBS Advisory Services TA for Kirov Oblast Delivered to Client FY11. LISP Implementation P121866 FBS TA to Support the Stavropol Krai Delivered to Client FY11. LISP Implementation Annexes CPSCR Review 38 Independent Evaluation Group CPS 07-09: Pillar 3 Actual Results Comments Improve the Delivery of Social and Communal Services (as of current month year) Objectives 1. Continue the poverty work 2. Improve the health of the population 3. Modernize and improve the education system and vocational training 4. Improve the provision of housing and communal services 5. Ensure housing finance and energy efficiency through IFC's PEP program -Major Outcome 1. Continue the poverty work Measures Ensure measured progress in regions targeted for . The national poverty rate fell from Modest Progress. poverty reduction and social assistance support in 13.4 percent in 2008 to 13.2 Source: CASCR. the World Bank poverty work percent by end-2009 and then to 13.1 percent in 2010. Social protection, mostly pensions, makes up a large part of the federal budget but is still badly targeted at the poor. Social protection spending increased from 2009 onwards despite the crisis. Labor market policies for the unemployed were introduced at the regional level to mitigate the impact of the crisis on employment, in addition to weekly monitoring of labor market indicators 2. Improve the health of the population Ensure reversals in negative health status trends Modest Progress. Maternal mortality (per 100 thous. Source: CASCR births) increased from 22 in 2007 to 32 in 2010. Infant mortality rate World Development Indicators. (per 1,000 births) declined from 11.4 in 2007 to 9.1 in 2010. Average life expectancy in the two pilot The percentage of HIV positive regions is increasing and infant mortality is infants born to HIV-infected women declining. In 2008, general practitioners decreased from 13.2 percent (base delivered care to about 65 percent of the line) to 10.6 percent in 2009; population in Chuvash Republic, up from 13.1 incidence rates of syphilis, percent in 2003; in Voronezh, from 3 percent gonorrhea and others STIs and to 30 percent. prevalence rate of HIV is reduced. 3. Modernize and improve the education system and vocational training Modernize curriculums, particularly in access to high A national curriculum of 75,000 Substnatial Progress. quality education using ICT new digital teaching resources is Source: CASCR. being used in 13 subjects for all grades. Vocational education development programs . were developed with special focus on the linkages between vocational education and the labor market in two regions under FBS agreements: Tver oblast and Krasnoyarsk krai. ECD and preschool education systems improved through (i) introduction of modern curriculum, (ii) strengthening the quality assurance system, and (iii) increasing access to ECD services. Higher education system development program and institutional strategies for universities were developed in Tatarstan. The Institutional Strategy of the Higher School of Economics as leading Russian university in area of social and economic sciences was developed and approved by the Government. Annexes CPSCR Review 39 Independent Evaluation Group CPS 07-09: Pillar 3 Actual Results Comments Improve the Delivery of Social and Communal Services (as of current month year) Ensure all schools connected to the internet The unified collection of digital High Progress. resources with more than 100,000 Source: CASCR. learning items has been established and is accessible to all Russian schools through the Internet. All schools are connected to the internet. 4. Improve the provision of housing and communal services Increase affordable housing as measured from Bank No information is available. Unknown Progress. infrastructure and housing projects or IFC mortgage support Continue rapid growth of the mortgage market No information is available. Unknown Progress. Source: CASCR. From 2007 to 2009, IFC’s investment client banks provided over 150,000 housing finance loans and held an outstanding mortgage portfolio of US$4.3 billion at the end of 2009. From FY05 to December 2008, advisory project pilot banks disbursed 110,858 mortgage loans worth US$6.8 billion, with extremely low delinquency rates. 5. Ensure housing finance and energy efficiency through IFC's PEP program NA Ongoing pre P008832 Municipal Waste and Wastewater Approved FY01. Closed FY09. IEG Rating: Moderately Satisfactory CAS/CPS Project (SIL) 07-10 P038551 Municipal Heating Project (SIL) Approved FY01. Closed FY08. IEG Rating: Satisfactory Support P082018 Kazan Approved FY05. Closed FY07. IEG Rating: Satisfactory Municipal Development Project P046497 Health Reform Implementation Project Approved FY03. Closed FY09. IEG Rating: Satisfactory (SIL) P050474 Education Reform Project (SIL) Approved FY01. Closed FY07. IEG Rating: Satisfactory P075387 e-Learning Support Project Approved FY04. Closed FY08. IEG Rating: Highly Satisfactory P064237 Tuberculosis & AIDS Control (SIL) Approved FY03. Closed FY09. IEG Rating: Satisfactory New P079032 Housing and Communal Services Project Approved FY08. Active. Latest IR Rating: Moderately Satisfactory Lending (SIL) Support P115338 - Chuvash Health – Sub-national Loan Approved FY09. Active. Non- Lending Support (Grants and Special Financing Projects) NA Planned P097193 Housing Market Study in Southern Okrug Delivered to Client FY07. AAA (2005-2007) P093771 HOUSING Delivered to Client FY07. P110048 FBS Khanti-Mansiysk Autonomous Okrug- Delivered to Client FY09. Yugra P112803 Regional HD Pub lic Expenditure Review Delivered to Client FY10. Additional P111119 FBS Higher School of Economy Delivered to Client FY11. AAA P113989 FBS Higher Education Kazan II Approved Delivered to Client FY10. P118448 Labor Market Monitoring and Policy Assessment TA Delivered to Client FY10. P122457 FBS Moscow Social Protection Delivered to Client FY11. P102229 HEALTH ADVISORY SERVICES Delivered to Client FY07. P108590 FBS Education Khanty-Mansisk AO Delivered to Client FY08. P111759 FBS Tver Oblast Vocational Education Delivered to Client FY09. P108590 FBS Education Khanty- Mansisk AO Delivered to Client FY08. P108985 FBS Higher Educ. Kazan Delivered to Client FY08. Annexes CPSCR Review 40 Independent Evaluation Group CPS 07-09: Pillar 4 Actual Results Comments Enhance Russia’s Global Role (as of current month year) Objectives 1. Assist in the formulation of an ODA strategy for Russia as emerging donor 2. Provide access to the WBG’s instruments for channeling Russian developmental assistance 3. Fulfill international obligations related to global goods 4. Link Russian companies to global markets -Major Outcome 1. Assist in the formulation of an ODA strategy for Russia as emerging donor Measures Develop an ODA strategy The Russian President approved Modest Progress. the Concept of International Source: CASCR. Development Cooperation and Action Plan for Planning is underway for the establishment of implementation in June 2007. a bilateral aid agency to be supported by a medium-term work program. 2. Provide access to the WBG’s instruments for channeling Russian developmental assistance Expand donor activities realized according to According to Russian statistics Modest Progress. articulated vision compiled in accordance with Source: CASCR. OECD-DAC methodology, ODA from the At the program level, a strong multilateral Russian Federation (excluding debt focus was endorsed by Russia’s ODA relief for the poorest countries) strategy. The effects of the global financial and grew from US$102 million in 2006 economic crisis together with volatile oil prices to US$785 million in 2009 (0.065 influenced Russia’s fiscal position and percent ODA/GNI). For 2010, priorities. Russia is estimated to have generated ODA amounting to US$500 million. As of March 2011 Russian contributions to IBRD administered Single and Multiple Donor Trust Funds have reached a total of US$518 million (including US$317 million for the Global Fund to fight AIDS, Tuberculosis and Malaria). The lack of a TF framework agreement with Russia has incurred unnecessarily high transaction costs. 3. Fulfill international obligations related to global goods Establish legal and institutional framework for The legal framework for Joint High Progress. carbon finance Implementation projects was Source: CASCR. established in 2008. A Climate Doctrine was approved in April 2009. “Energy Efficiency (EE) in Russia: Untapped Reserves� led to landmark EE law and the signing by President Medvedev of a decree to cut the energy intensity of Russia’s economy by 40 percent by 2020. Increase number of carbon finance operations in the IBRD carbon finance deal with Modest Progress. country with increasing awareness of climate change Rosneft to reduce gasflaring for a Source: CASCR. problems reduction of 2M tons of ERUs. IFC carbon finance deal with CoreCarbon reduced 2-3 M tons of nitrous oxide emissions. Russia’s goals in Energy Efficiency Annexes CPSCR Review 41 Independent Evaluation Group CPS 07-09: Pillar 4 Actual Results Comments Enhance Russia’s Global Role (as of current month year) and Climate Change are driven by domestic economic interests reducing incentives to make use of instruments geared towards global public goods. Russia underexploited its reserves in utilizing the carbon finance instruments under the current commitment period. 4. Link Russian companies to global markets NA Ongoing pre CAS/CPS 07-10 Support NA New Lending Support NA Non- TF 070664 Public Expenditure Management and Lending Peer-Assisted Learning (PEM-PAL) in the Europe Approved FY07. Active. Support and Central Asia Region Agreement (Grants and TF 071069 Financial Literacy and Education Approved FY09. Active. Special Agreement: Financing TF 071154 Russia Education Aid for Development Approved FY09. Active. Projects) Agreement TF071223 Energy Small and Medium Enterprises Approved FY09. Active. Support in Sub-Saharan Africa Agreement TF071577 Multi-Donor Programmatic Trust Fund Approved FY11. Active. Europe and Central Asia Public Finance Management P102324 CF 4: Rosneft Gas Flaring Reduction Approved FY08. Active. Latest IR Rating: Moderately Satisfactory Project Planned AAA NA Additional P096392 GIS Options Study in Russia Delivered to Client FY 10. AAA P115372 Energy Efficiency in Russia: Untapped Delivered to Client FY 10. Reserves