Document of The World Bank FOR OFFICIAL USE ONLY 52534 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF CENTRAL ASIA AIDS CONTROL PROJECT IDA GRANT NUMBER H149-7C DECEMBER 18, 2009 IN THE AMOUNT OF SDR 16.2 MILLION (US$25.81 MILLION EQUIVALENT) TO THE EURASIAN ECONOMIC COMMUNITY Human Development Sector Unit (ECSHD) Europe and Central Asia Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. 1 The grant is in SDR. The difference in the USD amount is due to exchange rate fluctuation (as of December 2009). There is no change in the amount of the loan in SDR. DATA SHEET FOR PROJECT PAPER Date: December 18, 2009 Team Leader: Nedim Jaganjac Country: Central Asia Sector Manager/Director: Abdo Yazbeck Project Name: Central Asia AIDS Control Country Director: Motoo Konishi Project ID: P087003 Environmental category: C Borrower: Eurasian Economic Community (EAEC) Responsible agency: Regional Project Management Unit (RPMU) on behalf of Eurasian Economic Community (EAEC) Revised estimated disbursements (Bank FY/US$m) FY 2010 2011 Annual 9.2 3.3 Cumulative 22.5 25.82 Current closing date: 12/31/2010 Revised closing date [if applicable]: N/A Does the restructured project require any exceptions to Bank policies? Yes No Have these been approved by Bank management? Yes No Is approval for any policy exception sought from the Board? Yes No The original Project Development Objectives are: (i) to reduce the growth rate of the HIV/AIDS epidemic in Central Asia in the period of 2005-2010; (ii) to establish in Central Asia a sustainable mechanism - the Regional AIDS Fund - that would serve as a vehicle for financing HIV/AIDS prevention and control activities in the region during and beyond the life of the Project; and (iii) to contribute to better regional cooperation in Central Asia, and effective inter-sectoral collaboration between public sector, non-governmental organizations and private sector on HIV/AIDS control in this region. Revised Project Development Objective would be: The Project will contribute to controlling the spread of HIV/AIDS in participating countries in the Central Asia Region by establishing regional mechanisms to support national HIV/AIDS programs. Does the restructured project trigger any new safeguard policies? No 2 The grant is in SDR. The difference in the USD amount is due to exchange rate fluctuation (as of December 2009). There is no change in the amount of the loan in SDR. Revised Financing Plan (US$m.): Not Revised1 Source Local Foreign Total Borrower 0.08 0.00 0.08 IBRD/IDA 12.3 13.5 25.82 Others/ DFID 0.7 0.9 1.6 Total 13.08 14.4 27.48 PROJECT PAPER CENTRAL ASIA AIDS CONTROL PROJECT 1. Introductory Statement This Project Paper seeks the approval of the Executive Directors to change the Project Development Objectives (PDO) of the Central Asia AIDS Control Project, Grant Number H149-7C, P087003, and to make relevant amendments to the Results Framework and the Project's legal documents. The proposed change to the PDO would better reflect the original goal of the Project and would enable more effective monitoring and tracking of the key elements of project performance on a regular basis (inputs, activities, results) by better linking the indicators to appropriate institutional and data collection arrangements. The revised set of indicators would also ensure measuring changes in the targeted results and outcomes which are directly attributable to the Project. 2. Background and Reasons for Restructuring The Project was approved on March 15, 2005 and became effective on November 4, 2005. The Project seeks to contribute to minimizing the potential negative human and economic impact of a generalized HIV/AIDS epidemic in Kazakhstan, the Kyrgyz Republic, Tajikistan and Uzbekistan. The original Project Development Objectives , as stated in the Grant Agreement, were to: i) Reduce the growth rate of the HIV/AIDS epidemic in Central Asia in the period 2005-10; ii) Establish in Central Asia a sustainable mechanism - the Regional AIDS Fund - that will serve as a vehicle for financing HIV/AIDS prevention and control activities in the region during and beyond the end of the Project; and iii) Contribute to better regional cooperation in Central Asia, and effective inter-sectoral collaboration between the public sector, non-governmental organizations (NGOs) and the private sector on HIV/AIDS control in this region. During the Project implementation the following issues with the original set of objectives were discovered: (1) The original PDO, to reduce the HIV/AIDS growth rate, is a higher-level Project objective which depends on efforts outside the Project's influence. There are also considerable measurement difficulties in tracking this growth rate. (2) The Results Framework has limited capacity to measure performance of project activities or their contribution to the expected outcomes. (3) Several outcome and intermediate indicators are not directly related to Project activities or do not have baseline or target values because relevant information is not available through existing institutional and data collection arrangements. Project performance to date Initially, implementation progress for this Project was hampered by the uncertain institutional and legal status for operation of the Regional Project Management Unit (RPMU). The RPMU was to be established by the Central Asia Cooperation Organization. The establishment of the RPMU was delayed by about one year due to uncertainties regarding its legal status. As a result, the Project was declared effective eight months after Project approval, and implementation was considerably slower than expected during the first 1.5 years of implementation. The Project is currently rated marginally unsatisfactory for both development objective (DO) and implementation progress (IP), reflecting the aforementioned problems with the DO and implementation framework, as well as initial implementation delays. Nonetheless, there has been tangible progress with project implementation recently and the Project's DO and IP are expected to be upgraded to satisfactory after restructuring. As of December 8, 2009, current disbursed amount is USD 16.7 million equivalent. Total disbursement plus commitment at the end of December 2009 is expected to be USD 18 million equivalent (70%). The remaining amount is planned to be committed in early 2010 and therefore no extension of closing date of the Grant is sought. To date, the Project has been successful in starting a regional initiative among Parliamentarians, and in establishing a permanent Inter-Parliamentarian Working Group; several high-level conferences and several parliamentary hearings were held to advocate changes that contributed towards establishing a legal environment which allows for the effective prevention and treatment of HIV/AIDS, and reduce stigma and discrimination; each beneficiary country has established regional center of expertise to address key issues relevant to control of pandemic; and has established regional tools for HIV/AIDS surveillance. The Project has significantly contributed to better regional cooperation in Central Asia, and effective inter-sectoral collaboration among the public sector and non- governmental organizations (NGOs) on HIV/AIDS control in this region. The main achievements were made in enhancing dialogue and capacity building while provision of goods is recognized to be less relevant for regional approach. Reasons for the project restructuring- This Project Paper requests a restructuring of the Project PDO and selected outcome and intermediate indicators for the following reasons: i) Unrealistic PDO. The Project's first PDO, "to reduce the growth rate of the epidemic," is a higher-level objective for which the Project cannot reasonably be held accountable for given its duration, resources, and approach. Reduced HIV/AIDS prevalence depends on other efforts outside the scope of the Project, such as trends in drug abuse or risky sexual behavior in populations not covered by the Project. In addition, several HIV/AIDS control projects are concurrently being implemented in the Central Asia region so that establishing the specific contribution of this Project to trends in the growth rate of the epidemic is challenging. ii) Considerable measurement difficulties in tracking the first PDO ("to reduce the growth rate of the epidemic"). Relying on track trends in the growth rate of the epidemic is problematic because the incidence in Central Asia is based on HIV case reporting which represents only a fraction of new infections occurring in this region. Specifically, due to low social-economic status as well as stigma and discrimination surrounding HIV/AIDS, it is common for members of the groups most at risk of HIV to avoid medical and social services, including HIV testing, so that the official data tend to downplay the scale of the epidemic. Thus, the baseline parameter for this PDO is likely to be underestimated. At the same time, through promoting HIV testing among these groups and supporting the activities to reduce HIV-related stigma and discrimination, this Project contributes to a growing reported number of injecting drug users, sex workers and prisoners being tested for HIV. As a result, there may be an increase in the number of reported new HIV/AIDS cases being registered at medical institutions. iii) Weaknesses in the current Results Framework. Although the current framework does specify a number of intermediate outcome indicators, these are not directly related to the activities that the Project supports, thereby limiting opportunities to capture performance that can be observed or measured while the Project is under implementation. Also, some of these indicators do not have baseline or target values because no relevant information is available through the existing institutional and data collection arrangements. The monitoring framework also does not specify institutional and data collection arrangements for integrating monitoring and evaluation at the outcome/results level (both intermediate and end of Project) into Project management. Given the multifaceted nature of epidemic control, the current results framework cannot differentiate attribution of the Project to achieved results. 5. Proposed Changes 1. This restructuring proposes to change the specific PDOs and associated outcome indicators as follows: Current PDO Proposed Revised PDO Reduce the growth rate of the HIV/AIDS The Project will contribute to controlling the epidemic in Central Asia in the period 2005- spread of HIV/AIDS in participating 10 countries in the Central Asia Region by Establish a sustainable mechanism in Central establishing regional mechanisms to Asia - the Regional AIDS Fund - that will support national HIV/AIDS programs. serve as a vehicle for financing HIV/AIDS prevention and control activities in the Region beyond the end of the Project Contribute to better regional cooperation in Central Asia, and effective inter-sectoral collaboration between public sector, NGOs and private sector on HIV/AIDS control in this region The revised PDO better reflect the main focus of the Project which is to create a mechanism for regional cooperation and catalyze discussion about issues that, for political or technical reasons, cannot be brought forward. In sum, the proposed PDO is better aligned with Project activities and it is an objective that the Project can reasonably be held accountable for, given the Project's duration, resources, and approach. 2. The Project Paper also proposes changes in Results Framework. In comparison with the current Results Framework, the revised Results Framework would be better linked to existing national data collection arrangements and national monitoring and evaluation frameworks, both at the outcome/results level. The Project will draw on data from the following sources: project reports, project monitoring data, sentinel surveillance, Central Asia Regional Information System (CARISA) reports, and reporting made to UNAIDS on UNGASS indicators. This revised framework has been developed in a participatory process with all relevant agencies and has benefited from the contribution of development partners, most notably UNAIDS. Project monitoring and evaluations will be an important task to be performed by the Regional Project Management Unit, whose capacity for M&E will be improved under the Project. The original and revised Results Framework is attached in Annex 1 below. 3. Finally the Project Paper proposes to make changes to the Schedule 1 of the Grant Agreement regarding allocation of funds. The original and proposed allocations are as follows: Initial Allocated Reallocated amounts of Grant (in Category amounts of Grant (in SDR) SDR) (1) Goods 1,950,000 1,250,000 (2) Consultants' services, including audit and 2,860,000 4,000,000 training (3) Sub Grants under Part 8,420,000 8,420,000 B of the Project (4) Operating costs 1,675,000 2,410,000 (5) Unallocated 120,000 1,295,000 16,200,000 16,200,000 Total The key project achievements to date have significantly contributed to capacity building, regional policy dialogue and policy formulation while provision of goods is recognized not to be the best comparative advantage of the regional approach. Therefore, in order to build on success of policy component the proposed reallocation of funds from Category of Expenditures for Goods to Consultants Services was requested. No other changes in Project design, scope or activities are proposed. 6. Analysis The proposed changes will not have a major impact on the original economic, financial, technical, institutional, or social aspects of the Project as appraised since they strictly seek to better reflect the objective of the Project by clarifying its PDO and allow for greater attribution and measurability of the Project's impact. Moreover, none of the proposed changes raise the environmental category of the Project or trigger new safeguard policies. This restructuring does not involve any exceptions to Bank policies. 7. Expected Outcomes The expected outcomes of this restructuring would be a more direct link between project financed activities and expected outcomes. If approved, this restructuring would also introduce new indicators into the results framework, identify relevant baselines and targets, and list the institutional arrangements for data collection that would be utilized. As such, the proposed changes would enable monitoring and tracking the key elements of project performance on a regular basis (inputs, activities, results), as well as ensure a more direct correlation between selected indicators and project activities (i.e. attribution). 8. Benefits and Risks This restructuring will not lead to any additional risks to the achievement of the restructured PDOs or outcome targets. Many of the critical risks identified at appraisal were already mitigated during implementation. Significant risk identified at the beginning of the project related to the conflicting interests of stakeholders including policy makers, vulnerable groups, civil society, decision-makers, opinion-makers and the international community is being mitigated by regional inter-sectoral dialogue promoted by the Project. However, this risk remains valid. Annex 1: Revised Project Results Framework Original Results Framework Revised Results Framework Original PDO Outcome Indicators Use of Outcome Revised PDO Outcome Indicators Use of Outcome Indicators Indicators Reduce the growth HIV/AIDS Growth Rate Existing national Contribute to Develop institutional Policy and practice rate of the (%TBD) statistics controlling the spread framework to inform development HIV/AIDS of HIV/AIDS in policies at epidemic in Central At least 60% of groups at Regional M&E participating countries national/regional levels Strengthening Asia in the period risk covered by the statistics in the Central Asia cooperation with 2005-10. Regional AIDS Fund Region by establishing Central Asia RAF is NGO sector and activities Project statistics regional mechanisms established providing services to (MIS) to support national vulnerable groups HIV/AIDS programs Strengthen the capacity and cooperation between the Public, Nongovernmental (NGOs) and the Private sectors on the Regional and National levels Establish a Stakeholders consider Project statistics sustainable Regional AIDS fund (MIS) mechanism in performance satisfactory Central Asia - the Regional AIDS Regional AIDS Fund is Fund - that will financed beyond the life serve as a vehicle of the Project (5 years) for financing HIV/AIDS prevention and control activities in the Region beyond the end of the Project Contribute to better National Coordination Project statistics regional Mechanisms and RPSC (MIS) cooperation in integrate representatives Central Asia, and of Governments, NGOs Existing national effective inter- and donors; and meet at statistics sectoral least twice a year collaboration Regional M&E between public statistics sector, NGOs and private sector on HIV/AIDS control in this region. Intermediate Results Indicators Use of Results Intermediate Results Indicators for Use of Results Results for Each Monitoring Results Each Component Monitoring One per Component One per Component Component Component One: Component One: Component One: Component One: Component One: Component One: Strategic, policy and Approval of updated Existing national Regional coordination Regional strategic Policy for prevention regulatory framework regional and national statistics and policy development framework for HIV/AIDS of HIV is informed updated strategies before Project developed. by regional guidance mid-term review Regional M&E Capacity is built throughout statistics 4 regional centers the region and sectors Sentinel and second established and are involved in HIV/AIDS generation surveillance Project statistics providing support to policies prevention and control established throughout the (MIS) in at least 4 areas (e.g. region by the 2nd year of the epidemiological Project surveillance, injection Regional M&E established safety, harm reduction, by mid-term stigma reduction, etc) Surveillance and Data will be obtained Schools of Public Health in regional M&E systems At least 3 rounds of sentinel for enhanced Kazakhstan and Uzbekistan surveillance with evidence based routinely carrying out involvement of NGOs are decision making training of staff from public conducted agencies, NGOs and private Human resources Build human sector by mid-term development Technical capacity of public capacities to provide sector and NGOs in policy services and develop development, grant policies and inform management/implementation public for behaviour and service provision is change enhanced Communication capacity on HIV/AIDS related issues among stakeholders (e.g. parliamentarians, religious leaders, journalists, NGOs, etc) improved Component Two: Component Two: Component Two: Component Two: Component Two: Component Two: Funds granted and Regional AIDS Fund disbursed annually as Existing statistics Central Asia Strategy for RAF developed Provide resources for performance is planned HIV/AIDS Fund initiatives and satisfactory Regional M&E Mechanism to distribute services that would At least 75% of users statistics funds is in place contribute to express satisfaction with containing the RAF performance Project statistics At least 4 grant cycles epidemic and (MIS) implemented promote regional 10% groups at risk collaboration. covered in the first year; 25% in the second year; 40% in the third year; 55% in the fourth year; and over 60% in the fifth year Component Three: Component Three: Component Three: Component Three: Component Three: Component Three: Funds disbursed By component and year Project statistics Project Management RPMU fully staffed and Implement project as planned (MIS) operational successfully M&E/MIS systems in place Procurement and financial management in place and satisfactory to the Bank RPMU in compliance with GAC policies