Document of The World Bank Report No: 18452-HO PROJECT APPRAISAL DOCUMENT ONA PROPOSED CREDIT IN THE AMOUNT OF SDR 6.2 MILLION (US$8.3 MILLION EQUIVALENT) TO THE REPUBLIC OF HONDURAS FOR AN INTERACTIVE ENVIRONMENTAL LEARNING AND SCIENCE PROMOTION PROJECT - PROFUTURO - May 25, 1999 Environmentally and Socially Sustainable Development Sector Management Unit Central America Country Management Unit Latin America and the Caribbean Region CURRENCY EQUIVALENTS (Exchange Rate Effective August 31, 1998) Currency Unit = Lempira Lp. 1.00 US$ 0.741 US$ 1.00 Lp. 14.00 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS CAS Country Assistance Strategy CBO Community-Based Organization CCAD Central America Commission of Environment and Development (Comisi6n Centroamericana del Ambiente y Desarrollo) COH4CIT Honduran Council of Science and Technology (Consejo Hondureno de Cienciay Tecnologia) CPAR Country Procurement Assessment Report CQ Consultant Qualifications FARAH World Bank Financial Accounting Reporting and Auditing Handbook GEF Global Environment Facility GOH Government of Honduras ICB International Competitive Bidding IDA Intemnational Development Association IDB Inter-American Development Bank IDF Institutional Development Fund ILC Interactive Learning Center LACI Loan Administration Change Initiative LCS Least-Cost Selection LIL Learning and Innovation Loan MIS Management Information System NBF Not Bank-Financing NCB National Competitive Bidding NGO Non-Governmental Organization OAS Organization of American States PIU Project Implementation Unit PROFUTURO Honduras Interactive Environmental Leaning and Science Promotion Project QBS Quality-Based Selection QCBS Quality and Cost-Based Selection SA Social Assessment SCAD Ministry of Culture, Arts, and Sports (Secretaria de Cultura, Arte y Deporte) SE Ministry of Education (Secretaria de Educaci6n) SEFIN Ministry of Finance (Secretaria de Finanzas) SERNA Ministry of Natural Resources and Environment (Secretaria de Recursos Naturales y Ambiente) SOE Statement of Expenses SOPTRAVI Ministry of Public Works, Transport and Housing (Secretaria de Obras Publicas, Transportey Vivienda) OAS Organization of the American States TOR Terms of Reference UNDP United Nations Development Programme UNESCO United Nations Educational Scientific and Cultural Organization Vice President: Shahid Javed Burki Country Director: Donna Dowsett-Coirolo Acting Sector Director: John Redwood Sector Leader: Mark Cackler Lead Specialist: Shelton Davis Task Team Leader: Maria-Valeria Junho Pena Honduras Interactive Environmental Learning and Science Promotion Project - PROFUTURO - CONTENTS A. Project Development Objective 1. Project development objective and key performance indicators ....................................I B. Strategic Context 1. Sector-related CAS goal supported by the project ......................................................2 2. Main sector issues and Government strategy ...................................................... 3 3. Sector issues to be addressed by the project and strategic choices ................................4 C. Project Description Summary 1. Project components ......................................................5 2. Key policy and institutional reforms supported by the project ......................................6 3. Benefits and target population ......................................................6 4. Institutional and implementation arrangements ...................................................... 7 D. Project Rationale 1. Project alternatives considered and reasons for rejection ...............................................8 2. Major related projects financed by IDA and/or other development agencies ................9 3. Lessons learned and reflected in the proposed project design .......................................9 4. Indications of borrower commitment and ownership ................................................... 10 5. Value added of IDA support in this project ..................................................... 10 E. Summary Project Analyses I. Economic ..................................................... 11 2. Financial ..................................................... 11 3. Technical ..................................................... 11 4. Institutional ..................................................... 11 5. Social ..................................................... 12 6. Environmental assessment ..................... 12 7. Participatory approach ..................... 12 F. Sustainability and Risks 1. Sustainability ..................... 13 2. Critical risks ..................... 13 3. Possible controversial aspects ..................... 14 G. Main Loan Conditions 1. Effectiveness conditions ..................... 14 2. Other ..................... 15 H. Readiness for Implementation ........................... 15 I. Compliance with IDA Policies ........................... 15 Annexes Annex 1. Project Design Summary ...................................................... 16 Annex 2. Detailed Project Description ...................................................... 19 Annex 3. Key Findings of the Pilot Social Assessment ...................................................... 23 Annex 4. Estimated Project Costs ...................................................... 27 Annex 5. Procurement and Disbursement Arrangements .................................................... 28 Table A. Project Costs by Procurement Arrangements ................................................... 30 Table Al. Consultant Selection Arrangements ...................................................... 31 Table B. Thresholds for Procurement Methods and Prior Review ................................. 32 Table C. Allocation of Loan Proceeds ...................................................... 33 Annex 6. Project Processing Budget and Schedule ...................................................... 34 Annex 7. Environmental Analysis ...................................................... 35 Table 1. Construction Phases, Responsible Party and Environmental Requirements ... 37 Annex 8. Status of Bank Group Operations in Honduras .................................................... 38 Annex 9. Financial Management System Action Plan ...................................................... 40 Annex 10. Country at a Glance ...................................................... 41 Annex 11. Documents in Project File ...................................................... 43 Map IBRD 29839 Honduras Interactive Environmental Learning and Science Promotion Project Location of Ethnic Groups Honduras Interactive Environmental Learning and Science Promotion Project - PROFUTURO - Project Appraisal Document Latin America and the Caribbean Region Central America Country Management Unit Date: May 25, 1999 Task Team Leader/Task Manager: Maria-Valeria Junho Pena Country Director: Donna Dowsett-Coirolo Acting Sector Director: John Redwood Project ID: 57350 Sector: Multi-sectoral Program Objective Category: EA, PA, EN, PV Lending Instrument: SEL Program of Targeted Intervention: X Yes [ ] No Project Financing Data [] Loan X Credit l] Guarantee [ Other [Specify] For Loans/Credits/Others: Amount (US$m/SDRm): US$8.3/SDR 6.2 Proposed terms: [x] Multicurrency [ Single currency, specify Grace period (years): 10 years [] Standard Variable [ Fixed [ LIBOR- based Years to maturity: 40 years Commitment fee: 0 - 0.5 percent Service charge: 0.75 percent Financing plan (US$m): Source Local Foreign Total Government 0.9 0.0 0.9 IDA 4.5 3.8 8.3 Total 5.5 3.8 9.3 Borrower: Republic of Honduras, Guarantor: N/A Responsible agency: Honduran Council of Science and Technology (Consejo Hondureho de Ciencia y TecnologJa) Estimated disbursements (IDA FY/US$M): 2000 2001 2002 2003 Annual 1.5 3.8 2.6 0.4 Cumulative 1.5 5.3 7.9 8.3 Project implementation period: 3 years Expected effectiveness date: 07/30/1999 Expected closing date: 10/30/2002 A: Project Development Objective 1. Project development objective and key performance indicators (see Annex 1): The development objective of the Honduras Interactive Environmental Learning and Science Promotion Project - PROFUTURO - is to encourage and expand Honduran scientific, environmental, and cultural knowledge and management in the context of the borrower's sustainable development needs and ethnic diversity. Page 2 To achieve its objective, the project will support the following activities: (a) design and implementation of an Interactive Learning Center (ILC) as a non-formal educational facility focused on the social, scientific and environmental requirements for sustainable development, to be used by children, teachers and parents with exhibits on topics such as: (i) science and technology (our world, energy, cities, transport, astronomy, geology, economic production); (ii) sustainable development and environmental management linkages with natural disasters (natural resources, plants and animals, biodiversity); and (iii) the human body and communication (the senses, cycle of life, language and knowledge, communication and artistic expression, the brain and memory); and (iv) sustainable development practices and scientific knowledge among pre-Hispanic cultures; (b) support for capacity building of staff and volunteers of the ILC and the development of an ILC communication strategy; and (c) design and implementation of a management plan for archeological parks. Key performance indicators are measurable and will include: (a) number of scientific and environmental exhibits for the ILC defined and installed; (b) number of schools, children and youth visiting the ILC yearly; (c) number of teachers trained on the sustainable development programs of the ILC, as defined in coordination with the Ministry of Education (SE); (d) proportion of priorities in the management plan implemented in the archeological sites; (e) as recommended by the pilot social assessment, increased proportion of children who express positive attitudes towards schools, science and Honduras; and (f) number of community and dissemination campaigns for families, schools, tourists, and private sector defined and in place. B: Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project (see Annex 1): Document Number: P-5923 Date of latest CAS discussion: August 5, 1993 IDA's most recent CAS for Honduras is dated July 14, 1993 and was discussed at the Board on August 5, 1993. A new CAS was under preparation and scheduled for presentation to the Board in mid-FY99, but this needed to be deferred when Hurricane Mitch struck Central America. However, the major elements of IDA's assistance strategy were summarized in the President's Report for the Hurricane Emergency Project (P-7280-HO, reviewed by the Board on December 22, 1998). The CAS itself is scheduled for Board presentation in October 1999. The proposed project will support the following specific CAS objectives: (a) Environmental Management and Sustainable Development. The ILC would address the CAS objective of improving natural resource management since it would develop and install interactive exhibits that will teach sustainable development concepts. The building itself will be environmentally friendly and promote the use of non-conventional energy sources for educational purposes (for example, solar panels, maximizing natural light, natural ventilation, rain water storage for irrigation of gardens and green areas, planting native plant species and incorporating these into the exhibits, etc.). Finally, through the development of an environmental and cultural resources inventory, the project would provide inputs for Government's tourism strategy by incorporating the protection and management of environmentally fragile areas. (b) Human Capital Development and Education. The ILC would complement education provided by schools through its hands-on and interactive exhibits since it can stimulate curiosity, enhance skills, cooperation, and independence of children and young adults. It would also promote new and innovative opportunities for teacher training and have a positive educational impact on families as shown by similar facilities in other Latin American countries (Colombia, Costa Rica, Mexico, and Venezuela). (c) Poverty Reduction. One of the recent trends in tourism has been the transition away from the traditional two-week/beach format towards shorter heritage-based and eco-tourism. In the COPAN Park, which was visited by more than 100,000 tourists annually prior to Hurricane Mitch, this trend has brought tourism into the forefront not only of archeological regeneration, but also ofjob creation. The Page 3 management plan for archeological parks and the support to priorities in research and reconstruction would help to restore the tourism flow interrupted by Mitch, and support actions to restore and increase sources of income, particularly for indigenous peoples living near these parks. The training of local residents, including indigenous peoples, as guides for COPAN would also have a positive impact by providing employment opportunities for the poorest groups in the Copan municipality. 2. Main sector issues and Government strategy: PROFUTURO is multi-sectoral, involving issues related to sustainable development, education and science, and archeological site management. Sustainable Development Honduras, an IDA country that harbors some of Central America's richest ecosystems, is facing serious natural resource management pressures. A large part of its primary forests have disappeared, unsustainable agriculture and logging are affecting rainfall, erosion, and agricultural output. A lagging rural economy combined with the severe damage caused by Hurricane Mitch is provoking rapid movement towards towns and cities, further stretching their already weak service delivery capacity. GOH has recognized that sustainable development can only be achieved if social, economic and environmental policies are harmonized. While much of the damage of Hurricane Mitch was not caused by poor environmental management and could not have been avoided by even the best practices, the shortcomings in this area certainly aggravated the severity and extent of damage, and the shock of Hurricane Mitch has helped to bring this message to the private sector and civil society generally. Honduras is an active member of the Central America Commission on Enviromnent and Development (CCAD) and the Government has signed the Central American Biodiversity Convention, the International Convention on Biological Diversity and the Alliance for Sustainable Development. Steps to improve natural resource management, biodiversity conservation and sustainable land use are being made through the IDA-supported Rural Land Management Project (Credit 2940-HO) and the Global Environment Facility (GEF) Biodiversity in Priority Areas Project (TF028367). Honduras is also part of a regional, umbrella (GEF) project for the protection of the Mesoamerican Biological Corridor, currently under preparation by CCAD. The proposed PROFUTURO project would increase the opportunities for children and young adults to learn about sustainable development and their environment in Honduras through the exhibits and events of the ILC. PROFUTURO would also promote awareness among the public about the diverse environment of Honduras through the information in the environmental and cultural resources inventory and demonstrate a unique environmentally friendly building with innovative technology and concepts. Education and Science GOH considers education a key sector within its strategy of growth and poverty reduction. The ILC would complement this strategy with its focus on sustainable development and environmental education. During the past two decades, the Government has implemented several programs to expand the coverage and improve the quality and efficiency of education. Honduras has made considerable progress in expanding access to education, particularly at the primary level: the number of students tripled from 319,381 to 1,054,964 over the 1970-97 period, and the net enrollment rate for primary education was approximately 80 percent in 1998. Despite the increase in coverage, there is still a need to improve the efficiency and efficacy of education, integrate environmental, public health, and intercultural concerns into the curriculum, and explore non-traditional teaching techniques. The ongoing Basic Education Project (Credit 2694-HO) is currently being restructured to address quality concerns and to pilot a community-based education model (along the lines of the successful El Salvador EDUCO program). By creating new and attractive opportunities for learning, the proposed ILC will attempt to address these challenges. GOH has placed an emphasis on the importance of science and technology for its future development. The mandate of the Honduran Council of Science and Technology (Consejo Hondurefno de Ciencia y Page 4 Tecnologia, COHCIT), the implementing agency, when it was created in 1993, was to advise, formulate, coordinate and promote programs and actions to foster science and technology development in Honduras. The ILC would contribute to this objective through its interactive exhibits on science and technology and the computer lab geared towards children and youth. The ILC would make the benefits and educational opportunities offered by science and technology available to the public at large. Although the ILC will be located in Tegucigalpa, lessons learned from the project will allow its expansion to rural areas. Archeological Site Management There are four archeological parks in Honduras, but only COPAN has been fully developed. However, prior to Hurricane Mitch, the sites in COPAN were under pressure from the number of tourists who visited the park at the same time. To offer tourists other options in the park, there is a need for the development of new exhibits and environmental attractions (for example, butterfly and bird watching trails) and more information on potential sites for development. After Mitch, the rehabilitation of several already existing exhibits and monuments also became necessary (for example, part of the roof of the COPAN Museum was destroyed) to restore the tourism flow, which is particularly important for the welfare of the local population in the vicinity of COPAN. 3. Sector issues to be addressed by the project and strategic choices: PROFUTURO would contribute to the longer-term effort to meet the multi-sectoral requirements of sustainable development. The Interactive Learning Center, to be located in Tegucigalpa, would promote learning about the social, scientific, and environmental elements of sustainable development. The ILC would be complemented by an itinerant model with smaller and well-targeted exhibits in rural areas. The management plan for archeological parks and related subprojects responds to damages resulting from Hurricane Mitch. It would help to establish research priorities in archeological parks (particularly Parque Copan Ruins, and also Parque Los Naranjos, Parque El Puente, and Parque Cevas de Talgua). The three- year project will be executed in a participatory manner with civil society and private sector stakeholders in order to build the ownership, capacity and constituency necessary for implementation. As part of its accountability strategy, a committee with representatives of the private sector, civil society, and Government would oversee project implementation. Specifically, PROFUTURO would address education, environmental issues, and archeological site rehabilitation. Education and the Environment To address the quality of education, particularly on environmental issues, the proposed IELC would create an interactive learning environment to reinforce concepts learned in the classroom or to allow for understanding of new concepts, such as sustainable development and non-conventional energy sources. It would potentially create more effective learning conditions and raise achievement levels through visits by schoolchildren and promotion of teacher training. Research shows that individuals learn in very different ways and from no single medium-some learn from reading and others who might be nearly illiterate learn from manipulating objects, looking at things, and making connections. Exhibits and programs in ILCs usually encourage fundamental educational skills in a format that boosts self-esteem, cooperation and independence, and celebrates ethnic diversity. The Ministries of Education, Environment, and COHCIT plan to develop a conceptual framework to guide the activities promoted by the ILC that is compatible with the pedagogical activities promoted by the educational system. In addition, the ILC, by promoting teacher training, will disseminate interactive pedagogical tools to improve the learning process. The pilot social assessment carried out during preparation (see Annex 3) highlighted topics the ILC could focus on to improve children's understanding about their world and their environment. The social assessment also demonstrated that although children are aware of preventive actions to protect the environment, very few were able to explain the consequences of environmental degradation or identify a course of action to reverse it. The ILC would help children learn to make connections between learning about environmental problems, understanding the reasons why there are problems, and offering proactive solutions. In addition, a research program on pre-Hispanic practices and scientific knowledge to be disseminated through ELC training programs will complete this strategy. The relevance of these practices was shown during Hurricane Mitch when modem buildings in COPAN were seriously damaged, while Page 5 pre-Hispanic buildings, such as its sepulcheres and temples, and the drainage system in the park, withstood the flooding. Tourism Potential and Sites There is a substantial untapped tourism potential in Honduras and prior to Mitch, tourism accounted for the sixth largest source of revenue. Honduras has four functioning archeological parks (Parque Arqueol6gico de COPAN Ruinas, Parque Arqueol6gico El Puente, Parque Arqueol6gico Cuevas del Talgua; and Sitio Arqueol6gico Los Naranjos), more than 100 archeological parks to be developed, and thirteen museums. It also has one of the largest park systems in Central America (with two Biosphere Reserves; sixteen National Parks; six Proposed National Parks, ten Wildlife Refuges, ten Biological Reserves; and twelve National Monuments). Once the ILC is open, Tegucigalpa has the potential to be integrated into the tourist circuit that today includes archeological parks and the Bay Islands. To address priority rehabilitation and reconstruction needs in the archeological parks, the proposed project would finance a sub-component for the design and implementation of a management plan for archeological sites. PROFUTURO would also address the need for systematic infornation on environmental and cultural sites to serve as an input into Government's tourism strategy, through financing the establishment of a resource inventory database to be installed in the ILC. C: Project Description Summary 1. Project components (see Annex 2 for a detailed description and Annex 4 for a detailed cost breakdown): Component Category Cost Incl. % of IDA- % of Contingencies Total financing IDA- (US$M) (US$M) financing 1. Sustainable Development Resources (a) design and implementation of ILC Physical (a) 4.9 52.3 4.2 86.0 and exhibits; (b) pre-Hispanic contribution, Institution (b) 0.4 4.7 0.4 100.0 including: (i) research on practices and Building and scientific knowledge of pre-Hispanic Technical cultures; (ii) training of local residents, Assistance including indigenous residents, as guides for the COPAN Park, and (iii) development of a conceptual framework for interactive archeological exhibits and workshops for children in the COPAN park; and (c) archeological parks subprojects. Physical (c) 1.4 15.1 1.3 95.0 2. Capacity Building and Communication (a) strategy for communication, social Institution 1.5 16.4 1.5 97.6 ownership and corporate awareness; Building and (b) training for staff and volunteers; (c) Social environmental and cultural resources Feasibility inventory; (d) management plan for archeological parks and sites; and (e) social assessment. Page 6 Component Category Cost Incl. % of IDA- % of Contingencies Total financing IDA- (S$MM) (US$M) financins 3. Project Implementation Unit (PIU) Project 1.1 11.5 0.9 87.5 Creation, capacity building and Management management of PIU. Total 9.3 100 8.3 90.1 2. Key policy and institutional reforms supported by the project: As a signatory to international agreements supporting biodiversity and sustainable development, GOH is currently implementing programs and projects to improve the management of key protected areas along the Mesoamerican Biological Corridor and promote the sustainable use of natural resources, particularly in degraded areas. Following the devastating impact of flooding caused by Hurricane Mitch, these issues are even more salient for future resource use and planning. The ILC would provide information to the Hondurans about their country and its environmnent and promote environmental education and understanding though interactive exhibits, events, and the building itself, an environmentally friendly demonstration. PROFUTURO would complement the ongoing educational policy reforms mentioned above and support the incorporation of interactive teaching methods to impart and reinforce concepts learned in the classroom. The proposed project would support the objective of improving the quality of education through teacher training and integration of public health, environmental, and intercultural concerns into the teaching methods. The proposed project would also contribute to the overall objective of COHCIT, as created by decree 55-92 on January 16, 1993, to advise, formulate, coordinate, and promote programs and actions related to the implementation of a national policy that fosters scientific-technology development in Honduras. The ILC would provide opportunities for children and the public at large to increase scientific and technological literacy through visiting the interactive exhibits that would demonstrate scientific concepts and the use of technology, including a computer lab. 3. Benefits and target population: Direct Beneficiaries As a non-traditional tool for learning about sustainable development, the ILC would have positive impacts on all different stakeholders in the education sector. First, it would create new educational opportunities for the Honduran children, particularly those living in, or close to, Tegucigalpa. Second, the innovative and interactive learning methodologies to be displayed by exhibits, followed by training programs and workshops would benefit teachers by enhancing their teaching skills. Parents would benefit since the ILC creates a dynamic and safe environment for learning, recreation and leisure. College students would benefit from the opportunity to be recruited and trained as guides. The ILC would also benefit the population at large living in and around Tegucigalpa by providing an educational leisure alternative. Residents, particularly poor residents and indigenous communities living near the archeological parks, especially COPAN, would benefit from the archeological parks sub-projects. Finally, the project would directly benefit local residents and indigenous peoples, by training them as guides to the parks. Indirect Beneficiaries. PROFUTURO would benefit the Honduran population at large, and particularly the poor, with potential opportunities opened by tourism, jobs in the archeological parks, and the construction and operation of the ILC. It would also benefit the Honduran population at large because it would promote national identity through the exhibits in the ILC and support to the archeological parks. Page 7 4. Institutional and implementation arrangements: Institutional arrangements for implementation The project would be implemented over a period of three years (1999-2002). The Honduran Council of Science and Technology (COHCIT) would have oversight responsibility and a PIU would be created within COHCIT to implement the project. The PIU would be responsible for all project implementation activities, including accounting, disbursement, monitoring and evaluation, coordination, and supervision. An Operational Manual will be finalized before the credit effectiveness detailing all the procedures to be following during implementation. The PIU would be managed by a technical coordinator with support of specialists in accounting and procurement, a secretary and a driver. The PIU would work collaboratively with other governmental agencies and civil society organizations, although it is responsible for project implementation and supervision and accountable for all related tasks. Given its previous experience with IDA, the Ministry of Public Works, Transport and Housing (Secretaria de Obras Publicas, Transporte y Vivienda, SOPTRAVI) would provide in-house training in accounting and procurement. Additional training would be provided by the consultant responsible for designing the financial action plan and installing the financial management system. Short-term consultants would be hired for special tasks, when necessary. For the ILC, SOPTRAVI would collaborate with the PIU by assisting with the development of TORs for the construction and supervision of the ILC, but all procurement documentation, technical specifications, terms of reference and contracts would be under the responsibility of the PIUJ. The Ministry of Culture, Arts and Sports (Secretaria de Cultura, Arte y Deportes, SCAD) would assist the PIU with TORs and the implementation of the environmental and cultural resources inventory and management plan for archeological parks, and would also benefit from training activities. However, these activities would be contracted by the PIU, according to procurement arrangements defined by IDA. For these activities, SOPTRAVI and SCAD would provide the necessary inputs for the execution and implementation of sub-components and activities and will present periodic progress and evaluation reports to the PIT, to be consolidated for purposes of monitoring and evaluation, coordination and supervision. Implementation agreements between the PIU and SOPTRAVI, and the PIU and SCAD will define the detailed responsibilities of each agency. An archeological institution with proven expertise in Honduran archeological sites will carry out, through an implementation agreement with the PIU, the pre-Hispanic contribution sub-component which includes training of local residents and indigenous peoples as guides and research on pre-Hispanic practices and scientific knowledge in the COPAN Park. The Ministry of Education (Secretaria de Educaci6n, SE) and Ministry of Natural Resources and the Environment (the Secretaria de Recursos Naturales y Ambiente, SERNA) would also collaborate with the PIU on the design of the exhibits for the ILC in order to make them compatible with the Honduran educational system and environmental education necessities. Teacher training on how to use the ILC would be provided by the Ministry of Education under the IDA-financed Basic Education Project. To guarantee its financial sustainability and sound management, the ILC would be managed by a non- profit organization (PROFUTURO Foundation), endowed by the private sector and in the process of being created. The by-laws of this foundation must be satisfactory to IDA (including sound financial management for the foundation and for the trust fund to created and include participation of the Ministry of Finance and COHCIT as board members). These by-laws, to be voted on by its founding members, will be sent to IDA. The agreement between the Government and the foundation to run the ILC should include inter alia, the following criteria: (a) the trust fund will be deposited in an institution which abides by the rules of the banking regulatory agency; and (b) major changes or expenditures affecting the assets of the foundation, including the trust fund should be authorized by the board. Page 8 Procurement and Disbursement During preparation and appraisal, procurement and disbursement arrangements were discussed in detail and agreed upon with COHCIT. These arrangements will be reflected in the Operational Manual of the project. Annex 5 contains a description of the procurement and disbursement arrangements covering goods, civil works, and technical assistance. Accounting, Financial Reporting, and Auditing Arrangements An IDA-certified financial management specialist carried out an assessment of the borrower's financial management system. The PIU is preparing a financial action plan (see Annex 5 and 9) for a management information system which will integrate project accounting, and financial management, disbursement, procurement and contract management and physical progress. This reporting system, as proposed, will comply with IDA procedures as stipulated in OP/BP 10.02 and detailed in the Bank's Financial Accounting Reporting and Auditing Handbook (FARAH). The elements of this financial management system are as follows: (a) establishment of a chart of accounts compatible with government budget classifications; (b) matching of inputs/outputs of physical information with financial informnation required; (c) arrangements to ensure that the accounting records are accurate and reliable; (d) arrangements to record contract commitments, expenditures and other information required to track the procurement process; (e) establishment and monitoring of project management indicators; and (f) establishment of audit arrangements. Agreement on project reporting format, types, frequency (quarterly) and distribution has been reached. It is expected that the system will be installed and in operation in early June 1999. Monitoring and Evaluation System Project implementation will be monitored by the PIU according to process, budget and impact evaluation indicators satisfactory to IDA. A project-specific Management Information System (MIS) will be ready prior to the effectiveness of credit to serve as the key project monitoring tool. The PIU will present to IDA, no later than October 30 each year, beginning in 1999, a Project Implementation Report covering project implementation activities during the previous calendar year. Such report will include: (a) the Project Implementation Plan for the year under review; and (b) the Project Monitoring and Impact Evaluation Indicators for this year under review. This Project Implementation Report will be discussed during Project Annual and Midterm Reviews. D: Project Rationale 1. Project alternatives considered and reasons for rejection: Assistance through an ongoing IDA investment. The main reason for the rejection of this alternative was that the multi-sectoral characteristics of the proposed project did not allow it to fit adequately in any of the ongoing IDA-supported prograrns. The Government and IDA agreed that other operations supported by IDA on education, environment, infrastructure or social protection had different objectives, and that this type of new and innovative project would place an unnecessary stress on the institutional energies needed to make those other ongoing programs successful. Target children's leaming on sustainable development through traditional education, rather than through an ILC prototype. After visiting several different ILCs in other countries, the Government realized that an ILC and schools are complementary tools of learning. Moreover, when a change in attitudes is desired, such as in the case of the promotion of sustainable development and environmental education, non-formal education tends to be more effective than traditional teaching methods. Design through standard procedures and monitoring indicators, instead of as a learning credit. Although presented as a standard credit since it slightly exceeds the ceiling of Learning and Innovation Loans and Credits (LIL), given its innovative features, PROFUTIJRO was designed and will be closely monitored as a flagship initiative. The ILC will be the first in Latin America conceived as an informal tool of learning on sustainable development and cultural diversity. Its success will require multi-sectoral management, teacher training, and parents' commitment. Page 9 Implement the project with other institution (SCAD. SE. or SERNA) rather than with COHCIT. Although the project will work collaboratively with all these institutions, the main inspiration to guide the project is the Honduran need for sustainable development. This will require a multi-sectoral approach leading to scientific and technological solutions to be displayed in the ILC. GOH evaluated COHCIT as having the best comparative advantage to implement these ideas and translate them into exhibits attractive to children. Also, COHCIT is better prepared to support a research program on pre-Hispanic practices and scientific knowledge and incorporate lessons in schools, through a dialogue with SE. Acquire second-hand exhibits from the Papalote Children's Museum in Mexico instead of plannin. designing and acquiring new ones. This alternative was rejected because the displays that were offered: (a) did not fit to the Honduran characteristics regarding sustainable development; and (b) they were too costly. 2. Major related projects financed by IDA and/or other development agencies (completed, ongoing and planned): Sector issue Project Latest Supervision (Form 590) Ratings (IDA-financed projects only) Implementation Development Progress (IP) Objective (DO) IDA-financed Land/Rural Development Rural Land Management S HS Environment Biodiversity in Priority Areas S S Education Basic Education Project U S Social Investment Fund Social Investment Fund (FHIS II) S S Social Investment Fund (FHIS IV) HS HS Other development agencies UNDP Eco-tourism and Sustainable Finalized Development in the Bay of Tela UNESCO World Heritage Sites Program OAS Diagnosis of Science and Finalized Technology in Honduras UNDP Support for the Development and Finalized Implementation of Research for Technological Innovation _ IP/DO Ratings: HS (Highly Satisfactory), S (Satisfactory), U (Unsatisfactory), HU (Highly Unsatisfactory) 3. Lessons learned and reflected in the project design: Lessons from other donors and from the Bank experience in Central America suggest: (a) for sustainability, it is important to involve the private sector in educational and environmental initiatives; (b) for sustainability, financial mechanisms need to fully cover operational costs; (c) for ownership, the main stakeholders must be involved from the beginning of project preparation; (d) flexible but comprehensive institutional arrangements foster successful implementation; and (e) social cohesion is important for successful development programs. There is also evidence that interactive learning centers (also named Children's Museums or Science Museums) are an effective tool of informal education. The Children's Museum of Caracas, inaugurated in 1982, has been visited by more than 3 million children and the school system uses it as a support for Page 10 formal classes. By having fun and handling the exhibits' artifacts, children learn about biology, ecology, communications technology, physics and chemistry. More than 5 million children have already visited the Papalote Children's Museum in Mexico, which defines itself as a space where children and adults understand what happens to them by making things happen. The Mexican Museum is divided into five exhibits: Our World (our city, our country, our world; natural phenomena; plants and animals); Human Body (brain and memory, my body in action, the senses; to be born, to grow up and health); Science (waves, light and shadow, bubbles, technology, energy, how things work); Communication (language, communication systems); and Expression (drawings, paintings, sculptures and architecture, theater and literature, and music). Successful workshops are held involving the entire school system in Mexico City, such as: tolerance week, environment day, and others. At the Costa Rica Children's Museum, children can visit an old milk farm, travel through the history of Costa Rica, experience what is like to be a director of a small symphony orchestra, or listen as a life size robot recounts his experience in space as a NASA astronaut. The Children's Museum of Bogota is annually by about 300,000 people, including school children during the weekdays and families during the weekends. It has exhibits on how a city works and what is needed to provide water, sanitation, communication and energy. All these interactive centers are successful due to five main reasons: (a) strong links with their communities and with the school systems; (b) support from the private sector; (c) outreach programs that increase access to poor children and to schools located in poor neighborhoods; (d) interdisciplinary and multi-sectoral conception; and (e) appropriateness to the historical/social/cultural environment. All of these lessons' have influenced and inspired the design of the proposed ELC and the design and the conception of the Honduras PROFUTURO Foundation 4. Indications of borrower commitment and ownership: The concept of sustainable development guides the proposed project and Honduras is signatory to many regional and international conventions that provide a framework for this concept. The borrower has demonstrated commitment to and ownership of the proposed project during all stages of project preparation. The borrower has already created and staffed the Project Implementation Unit, presented a satisfactory draft of the Operational Manual, and is actively organizing the PROFUTURO Foundation. The borrower's commitment is also evident in the active participation of high level staff of different institutions in the Government during preparation workshops. Also, representatives from the Ministries of Finance, Culture, Science and Technology and Environment made the effort to attend an international seminar held in California about ILCs. Finally, study tours were conducted with PROFUTURO staff in Mexico and Central America and the United States, also visited by the First Lady of Honduras and the Minister of Science and Technology. 5. Value added of IDA support in this project: The creation of the ELC as an informal tool of education on sustainable development, but linked to the schools, recognizes that other institutions, not only schools, produce understanding and stimulate curiosity for knowledge. IDA contributes to this effort by bringing together multi-disciplinary expertise, including social scientists, education specialists, environmental specialists and financial specialists for the preparation and implementation of the proposed project. Since IDA is currently supporting projects in both the education and environmental sectors in Honduras, this facilitates opportunities to establish connections among the agencies involved, share information, and increase coordination. Page 1 1 E: Summary Project Analysis 1. Economic: The project has not been subjected to a conventional economic rate of return analysis, since its immediate objectives and outputs will be primarily institutional. However, the project will generate the following non-quantifiable economic benefits: (a) children would have access to information on sustainable development; (b) children would have access to scientific and technological data; (c) parents would have access to this same information; (d) teachers would have access to new interactive teaching tools; (e) the flow of tourism to COPAN would benefit from rehabilitation sub-projects; and (f) pre-Hispanic practices and scientific knowledge and its contribution to modem science will be rescued. 2. Financial: PROFUTURO is effectively a pilot project and full cost recovery is not a project objective. However, a financial analysis was included in preparation and an attempt has been made to estimate the financial benefits and costs based on a similar interactive center in Mexico, the Papalote Children's Museum. The main category of operating costs is personnel. Assuming 50 employees with a monthly salary range between $200 and $1,000 among professionals and support staff, personnel costs amount to $500,000 per year, plus operating and maintenance expenses ($300,000 - $500,000) for a facility of 4,000 m2, total recurrent expenses amount to $800,000 - $1 million, including advertising. To cover these costs, it is assumed that entrance fees will amount to 10 percent and most visitors will not be charged since they will be children with their schools and low income groups. Revenue generating activities such as a coffee shop, conventions, social festivities and souvenir shops are expected to amount to 15 percent of operating costs and the remaining 75 percent to be covered by PROFUTURO Foundation, as mentioned in the institutional arrangements. Fiscal impact: The project's fiscal impact is not significant because recurrent costs (about $1.0 million annually) will be covered partly by the Foundation's fundraising activities. The only costs absorbed by GOH are the counterpart funds, which represent 12 percent (average of $250,000 annually for three years) of the total of the project. The ILC construction will not entail purchase of land since it will be built on land owned by Government, the Centro Civico of Tegucigalpa. 3. Technical: The construction of the ILC will involve technical studies in architecture, soil analysis and engineering, as well as an environmental analysis. The planning and acquisition of objects to be displayed by the ILC will involve design and social analysis. Studies, plans and recommendations will be reviewed by IDA, including cost estimates, engineering data, supervision reports, outputs, and allowances for physical and price contingencies. 4. Institutional: Executing agencies: The PIU will be located in COHCIT, a small agency which reports directly to the President. Conceived as a decentralized entity (ente desoncentrado), COHCIT, in contrast to other Ministries, is financially autonomous. During implementation, the PIU would work collaboratively with other governmental agencies and civil society organizations, although it is responsible for project implementation and supervision and accountable for all related tasks. This is the first IDA-financed project to be implemented by COHCIT and project preparation included an analysis of their capacity to deliver the intended objectives and an assessment of the COHCIT's financial management system. In order to complete the recommendations from this review, the PIU is preparing a financial action plan for a management infonnation system which will integrate project accounting, and financial management, disbursement, procurement and contract management and physical progress. Page 12 As described in more detail in section C.4., the other government agencies involved in project implementation include the Ministry of Public Works, Transport and Housing, the Ministry of Education, the Ministry of Culture, Art, and Sports, and the Ministry of Environment and Natural Resources. Given the importance of institutional collaboration in this project, representatives from these agencies participated in a three-day Logical Framework workshop held during project preparation. The Ministry of Finance has also been closely involved in preparation and, in fact, the project coordinator was selected from within this Ministry. While inter-institutional collaboration has been positive during project preparation, care will need to be taken to ensure that this continues during project implementation. 5. Social: A social scientist with a specialization in gender and a Honduran social scientist were part of the core preparation team. Supported by the Swiss Trust Fund, a pilot social assessment (SA) was conducted during preparation based on consultation with children and teachers in rural and urban schools, both public and private. Results of this assessment were reflected in project design. A larger-scale social assessment will be conducted at the outset of implementation. Teachers, parents, and children will be interviewed and consulted and research on what children of the 21 st century should learn from the Maya and other ethnic groups will be conducted. In addition, the SA would provide guidance for the design of the social ownership strategy of the project (see Annex 3, Pilot Social Assessment). Based on recommendations from the pilot social assessment, children's attitudes about Honduras and self-esteem were included as monitoring indicators. With funds awarded by the Gender Operational Fund, a gender assessment was also conducted as part of project preparation. More than 200 students were consulted through focus groups and written essays, covering issues such as the value of education and schools, daily life and family, expectations and dreams, what are the perceived characteristics of being Honduran, Honduran ethnic diversity, environment and Hurricane Mitch. The analysis, conducted with a gender perspective will influence the ILC exhibits and the training programs. 6. Environmental assessment: Environmental Category []A [ x] B []C An environmental specialist was part of the core preparation team. No major risks associated with this project have been identified. On the contrary, given the concept proposed for the ILC, the project would have a positive impact on the enviromnent. The construction of the ILC would not generate environmental impacts given the characteristics of the area and its proposed location (in spite of being in an urban area, it is far enough from residences and businesses so as to not provoke discomfort during construction). The building would be designed to be environmentally friendly with the consideration of: (a) solar panels to satisfi totally or partially the electricity needs of the ILC; (b) rain water storage for the irrigation of gardens and green areas; (c) recycling waste waters for irrigation; (d) separation of the potable water systems from irrigation systems; (e) maximizing natural light in order to minimize artificial light needs; (f) planting native species in gardens and green areas and incorporating these into the activities of the ILC with pedestrian walkways (showing children native species); (g) using windmills for groundwater exploitation for irrigation water; and (h) the stabilization of slopes using vegetative measures. All recommendations from the enviromnental specialist will be incorporated into the Operational Manual (see Annex 7, Enviromnental Analysis). 7. Participatory approach: The project is not expected to provoke adverse effects on any group. On the contrary, it will be largely beneficial to the entire Honduran population. A pilot social assessment was conducted during preparation and a full social assessment will be undertaken at the outset of implementation, including incorporation of indigenous groups in the consultation process. The Logical Framework for the project was prepared during a three-day workshop with the main stakeholders of the project - representatives from Government, civil society, private sector, and IDA. The project would be implemented in a participatory fashion and a supervision committee would be created with representatives from the Government, private sector and civil society. Page 13 a. Primary beneficiaries and other affected groups: During preparation, children and teachers were consulted as part of the pilot social assessment. For the full social assessment to be carried out during implementation, not only children and teachers from other regions will be consulted, but also parents. Indigenous groups and other ethnic minorities will be included during the preparation of the environmental and cultural resources inventory. They will also participate in the definition of the exhibits for the ILC. b. Other key stakeholders: Key stakeholders were consulted and participated in a three-day seminar held during preparation to design the Logical Framework. A workshop with other key stakeholders (NGOs, other intemational organizations, community groups, university, college students, and private sector) is planned for the beginning of project implementation. F: Sustainability and Risks 1. Sustainability: Sustainability of this proposed project depends to a large extent on the establishment and savvy management of the PROFUTURO Foundation resources. During preparation, it was agreed that all statutory legal requirements would be complied with for the establishment of the Foundation by May 1999 (condition of disbursement for the ILC) and that minimum pledges of $700,000 p.a. can be guaranteed from the Honduran private sector for, at least, the first three years of project implementation. Additional fund raising activities would be undertaken with bilateral donors and multinational companies active in Honduras. It is therefore expected that the Foundation would have raised a minimum of about $2 million by the time the ILC is built. To cover the likely 75 percent operational deficit, a trust fund would be established with a financial institution to invest these resources in financial instruments (bonds, shares, CDs etc). The project is expected to be financially sustainable, given the commitment of the private sector to make this a successful venture. The archeological parks subprojects would address urgent reconstruction needs in the sites, due to damages provoked by Mitch, in order to restore and regain the previous flow of tourism. 2. Critical Risks (reflecting assumptions in the fourth column of Annex 1): Risk Risk Risk Minimization Measure Rating Annex 1, cell "from Outputs to Objective" Public is not sufficiently interested in N A communication strategy would be established. the ILC. The Ministries of Education, Environment and Culture and the PIU would work closely to make the ILC useful for the school systems. A pilot social assessment carried out during preparation demonstrates the usefulness of the ILC and the full social assessment at the outset of implementation would help to guide the communication strategy. The necessary inter-institutional M The project has been designed and would be collaboration will not happen. implemented with representatives of all the key institutions involved. Page 14 Risk Risk Risk Minimization Measure tinRa Private sector support will not endow M A condition for beginning civil works is thc the PROFUTURO Foundation as creation of a private foundation (PROFUTURO expected over the long run Foundation) which at this point in time is expected to have a trust fund endowed with $1.5 million. Private sector representatives have committed themselves to a flow of about a million a year for the coming few years. The by laws of this Foundation and its trust fund are in process of being finalized and voted upon. Finally, the project would support communication activities to increase corporate awareness. Annex 1, cell "from Components to Outputs" Stability of the personnel responsible M During meetings held between IDA and the for the project Government it was understood that this stability is crucial for successful outcome. An economist from the Ministry of Finance (Secretaria de Finanzas, SEFIN) was chosen as project coordinator, which is an important indicator of commitment in the country. Efficient and timely flow of resources M In contrast to other Ministries, COHCIT is a to implement the project. decentralized entity, with control over the accounts of the project. The counterpart budget has been already been approved as part of the National Budget for FY99. Availability of materials for N The ILC would be designed taking this possibility construction of the ILC. into consideration and avoiding the risk. Local materials shall be given priority. Overall Risk Rating M The project is considered a priority at the highest levels of GOH which considers it a flagship initiative. The staff of COHCIT is highly qualified; many with experience from the private sector and a capable project coordinator and accountant have been appointed. The staff is very motivated about the project and consider it the most important activity for the coming years. 3. Possible Controversial Aspects: None identified. G: Main Loan Conditions 1. Effectiveness Conditions (a) The Implementation Agreement shall have been entered into by COHCIT and the Implementation Entity (NGO) which will carry out the Pre-Hispanic Sub-component; (b) The final version of the Operational Manual has been approved by COHCIT and sent to IDA; and (c) Financial Management System has been established. Page 15 2. Other: Disbursement conditions Before the beginning of civil works: (a) PROFUTURO Foundation is created legally and by-laws sent to IDA for review; (b) PROFUTURO Foundation is endowed with a minimum of $1.5 million; and (c) Government sends to IDA evidence of the legal title of the land. Before the establishment of the archeological management plan sub-projects Manual for the sub-projects is ready with priorities from the management plan established. H. Readiness for Implementation [ ] The engineering design documents for the first year's activities are complete and ready for the start of project implementation. This item is not applicable since the engineering documents would be prepared following the architectural design competition as described in Annex 5. [x ] The procurement plan for the first year's activities was completed during appraisal and is ready for the start of project implementation. [x] The Project Implementation Plan (Operational Manual) was appraised and will be fmalized before credit effectiveness. -. Compliance with IDA Policies [x ] This project complies with all applicable IDA policies. Task Team Leader/Task Manager: Maria Valeria Junho Pena Acting Sector ManagerRDirec hn Redwood Acting Country Manager/Director: Mark Cackler Page 16 Annex 1: Project Design Summary Honduras: PROFUTURO Narrative Summary Key Performance Indicators Monitoring and Critical Evaluation Assumptions Sector-related CAS Goal: (Goal to IDA Human capital Mission) development, poverty Sustainable reduction, and sustainable development development. prioritized by GOH Project Development (Objective to Goal) Objective: Promote and expand 1. In the ILC, a minimum of: 1. Other projects scientific, environmental, 1.1 100,000 visitors (70 percent with similar goals are and cultural knowledge younger than 18 years old) during the successfully and management in the first year. developed. context of Honduran 1.2. 150,000 visitors (70 percent 2. Government sustainable development younger than 18 years old) during the policies and priorities and ethnic diversity. second year. related to families 1.3. 200.000 (70 percent younger than and children are 18 years) during the third year. maintained. 3. Continual support 2. In Tegucigalpa, a minimum of: of the international 2.1. 25 percent of schools use the ILC community and the environmental and cultural 4. Social and resources database as part of their political stability is lesson plans in the first year; maintained 2.2. 50 percent of schools use the ILC 5. Maintenance of and the resource inventory database as sustainable growth part of their lesson plans in the second goals year. 2.3. 75 percent of schools use the ILC and the resource inventory database as part of their lesson plans in the third year. 3. The number of children expressing positive feelings towards the environment, their country, and its identity has doubled from the base line one year after museum opening. Outputs: (Outputs to 1. Infrastructure and 1. External and internal installations 1. Project Objective) equipment of the ILC in of 4000 square meters in accordance Completion Report. 1. Sufficient interest place. with the design and the technical and participation of specifications concluded 12/2000 the public. 2. Exhibit package 2.1. Eighty scientist/technical and 2. Delivery of the 2. Personnel stability defined, established and cultural exhibits (4 per module) ILC. and effective training operational. installed by 01/2001 in accordance programs. with technical specifications. Page 17 Narrative Summary Key Performance Indicators Monitoring and Critical Evaluation Assumptions 3. Complementary 3.1. A package of at least six 3. Delivery of the 3. Continued activities and services complementary activities (art ILC. cooperation and defined, operational and workshops, craft workshops, teacher participation of the effective. courses, holiday courses for children institutions and young adults, music workshops, dance workshops, theater for children, temporary exhibits) designed, supplied and, in operation by 01/2001 3.2. A package of technical facilities (technical and operational assistance to the educational system, concerts, interactive information center, souvenirs shops, cafeteria, fast food services, transportation, first aid services,) designed by the year 01/2000 4. Mechanism for 4.1. PIU with plans for the execution 4.1. PIU staff hired 4. Efficient and managing, operating and of physical works defined and and in place with a timely flow of funds sustaining the effective operational before September 1999. work program. from the private operation of the ILC. sector to operate the 4.2. Operational Manual with 4.2. Operational ILC. procedures, rules, terns of reference Manual established, design and operating before September, 1999. 4.3. Deed of the 4.3. PROFUTURO Foundation agreement between established before June 1999. the Government and the PROFUTURO Foundation published in the Official Gazette 4.4. Foundation with funding from 4.4. Trust Fund private sector in sufficient amounts to established in the cover operational expenses of the ILCs Foundation for the as follows: ILC. year- 2001: 95 percent year- 2002: 90 percent year- 2003: 80 percent 4.5 Funds generated by the ILC: 4.5. Audited -2001: 5 percent financial statements - 2002: 10 percent of the trust fund. - 2003: 20 percent 4.6. Funds obtained by the trust fund 4.6 Audited as follows: financial statements 12/1999: 1.5 million of the trust fund. 12/2000: 1.8 million 12/2001:2 million 5. Environmental and 5. Surveys of users cultural resources 5. Hardware and software to operate of the environmental assessment database ready the environmental and cultural and cultural for being used and installed resources database available and resources in the ILC. installed assessment database. _ Page 18 Narrative Summary Key Performance Indicators Monitoring and Critical Evaluation Assumptions 6. Staff, volunteers, guides 6. 200 staff trained by the end of year 6. Training and teachers trained. 2001 (50 staff of the children ILC, 100 workshops reports. college students to serve as guides and 50 of the Ministry of Culture); 100 local guides trained by the end of year 2001; 1000 teachers trained by the end of year 2001. 7. Communication, 7. Promotion materials, videos, and participation and tourists brochures developed and promotion operational distributed among 100 tourist agencies strategies finalized. in Honduras, Central America and international. Project Components/Sub- Inputs: (Components to components: Outputs) 1. Sustainable 1. Stability of the DeveloDment Resources: personnel in charge of the project 2. Efficient and (a) Interactive Leaning $4.9 million Disbursement timely flow of funds. (b) Pre-Hispanic reports 3. Disposition and (b) Pre-Hispanic $0.4 million experienced Contribution personnel and (c) Archeological Parks $1.4 million corporations that sub-projects support the project. 2. Capacity Building and .. 4. Stability of the Communication $1.5 million construction company and 3. Project fImplementation availability of 3.UProject Implementatio $1.1 million material and resources. 5. Availability of the equipment and exhibits for purchase and fabrication purposes. 6. Private sector is interested in supporting financially the nonprofit organization _ 7. Political Stability Page 19 Annex 2: Project Description Honduras: PROFUTURO Project Component 1 - $6.7 million Sustainable Development Resources Component The objectives of this component are to assist the GOH: (a) design and implement a 4,000 square meter ILC in Tegucigalpa as a non-formal educational facility on the social, scientific, and environmental requirements for sustainable development, to be used by children, teachers, and parents; and (b) establish archeological management plan sub-projects. There are three sub-components: Interactive Learning Center; Pre-Hispanic Contribution; and Archeological Parks Sub-projects. Sub-component ILC ($4.9 million). The ILC sub-component will support a non-traditional, hands-on, and interactive informal learning experience on science, environment and sustainable development built in evolving modules. This sub-component includes: (a) Infrastructure ($3.7 million), including: (i) architectural design; (ii) soil assessment; (iii) engineering design of the building of the ILC, including equipment and finishing; (iv) construction of an ILC with 4,000 square meters; and (v) plan to operate and maintain the building and the equipment. (b) 30 Exhibits and Artifacts to be displayed ($1.2 million) including: (i) studies and definition of the exhibits and artifacts; (ii) exhibit design (iii) fabrication, acquisition and installation of the exhibits; (iv) plan for operation and maintenance of the exhibits and artifacts; and (v) plan for renovation of the artifacts. These exhibits will focus on the following: (i) science and technology (our world, energy, cities, transport, astronomy, geology, economic production); (ii) sustainable development and environmental management linkages with natural disasters (natural resources, plants and animals, biodiversity); (iii) the human body and communication (the senses, cycle of life, language and knowledge, communication and artistic expression, the brain and memory); and (iv) sustainable development practices and scientific knowledge among pre-Hispanic cultures. (c) Activities and Services to the community (workshops for teachers and parents, plays, interactive data center with the environmental and cultural resources inventory, cafeteria, gift shop, etc.). The following activities will be undertaken: (i) plan for additional services; and (ii) plan for service "concessions" for the private sector. (d) Support to the PROFUTURO Foundation on: (i) definition of the organization and administration of the ILC; (ii) definition of human resources, career development, and job descriptions; and (iii) recruitment. Page 20 Sub-component Pre-Hispanic Contribution ($0.4 million). This sub-component will support research on pre-Hispanic practices and scientific knowledge to be disseminated to teachers and students through the ILC and through a small children's facility in the COPAN Museum. It will also finance activities to promote ownership among indigenous peoples regarding COPAN. The following activities will be undertaken: (a) technical assistance to carry out studies about the pre-Hispanic contribution to modem science and environmental management ($0.2 million) (b) training local residents and indigenous as guides for COPAN Park and teachers and students on pre- Hispanic practices and scientific knowledge ($0.2 million); and (c) technical assistance for the development of interactive exhibits and workshops for children in the COPAN Park ($0.05 million) Sub-component Archeological Parks Sub-projects ($1.4 million). This sub-component will support activities considered priorities by the management plan for archeological parks. Up to $400,000 are allocated for emergency subprojects to be implemented prior to the conclusion of the management plan, but according to criteria defined in the Operational Manual. (a) Emergency Archeological Parks Subprojects. ($0.4 million) (b) Archeological Management Plan Subprojects. ($1. 0 million) Project Component 2 - $1.5 million Capacity Building and Communication The objectives of this component are to support the capacity building of staff and volunteers of the ILC and develop a communication strategy for the public and corporations. This component includes: (a) Development of a communication and dissemination strategy, including planning fundraising activities, informing the private sector, and creating social ownership. Activities to be financed will include an array of public information and dissemination programs and efforts to create public and particularly corporate awareness, and social commitment and ownership regarding the project. Targeted groups will consist of business people, potential contributors, parents, children, education stakeholders, cultural stakeholders, scientific and technological community, ethnic groups and college students. In the aftermath of Mitch, this dissemination will also consider the re-launch of COPAN Park and other archeological parks for international tourism. ($0.8 million) (b) Design and implement a program to develop a body of professionals and volunteers at the national level, for researching, designing and implementing the ILC, archeological parks management and reconstruction. Special programs will be designed for volunteers and for college students who will function as the ILC guides. ($0.4 million) (c) Design and implement an environmental (ecological sites, archeological parks, national parks, biological reserves, etc.) and cultural resources inventory (cultural sites) and store it in a database that is accessible to the users of the ILC. ($0.1 million) (d) Design of a management plan for archeological parks, which will identify priorities for research and reconstruction. ($0.1 million) (e) Design and implement a social assessment. The main objectives of the social assessment will be to: (i) identify the main stakeholders of the project and their respective stakes, including international stakeholders and private sector; and (ii) ensure that ILC exhibits are not gender biased and are appropriate to the social diversity of the country. ($0.1 mflion) Page 21 Project Component 3 - $1.1 million Project Implementation Unit Financing will be provided to develop and strengthen the capacity for management, monitoring and evaluating the project. The project will support capacity building in project management, including: finance and administration, ILC design and exhibitions, engineering, procurement, and monitoring and evaluation. Activities include: (a) recruitment of international and national specialists for short periods of time in the above-mentioned areas; (b) training provided by international and national specialists in the above-mentioned areas; (c) recruitment of a consultant to develop, based on the Operational Manual, a project specific Management Information System (MIS) as a tool for monitoring and evaluating financial and implementation performance and social impacts of the credit; and (d) study tours to other ILCs, particularly in Latin America countries (Venezuela, Colombia, Bolivia, Costa Rica and Mexico) and participation in international and national events pertaining to the ILCs. Page 22 Summary Cost Table by Components Component/Sub-component Responsible Amount Agency (US$ thousand) 1. Sustainable Development Resources a) Interactive Learning Center COHCIT/PIU 4,842.5 b) Pre-Hispanic Contribution COHCIT/PIU 435.3 c) Archeological Parks Sub-projects SCAD 1.400.0 Subtotal 6,677.8 2. Capacity Building and Communication a) Communication and Dissemination Strategy COHCIT/P1U 550.0 SCAD 203.8 754.6 b) Training Program for professionals and volunteers COHICT/PIU 359.8 SCAD 61.5 421.3 c) Environmental and Cultural Resources Inventory SCAD 38.4 COHCIT/PIU 50.7 89.1 d) Design management plan for archeological parks SCAD 152.2 152.2 e) Social Assessment COHCIT/PIU 101.7 101.7 Subtotal 1,518.9 3. Project Implementation Unit (Evaluation, COHCIT/PIU 1.068.2 1,068.2 Monitoring, and Management) TOTAL 9,264.9 Summary Table by Responsible Agency Responsible Agency Total Amount of Project Amount Financed by IDA (US$ (US$ thousands) thousands) COHCIT/PIU $ 7,358.3 $6,516.4 SCAD $ 1,906.6 $1,832.0 TOTAL $9,264.9 $8,348.4 Page 23 Annex 3: Key Findings of the Pilot Social Assessment Honduras: PROFUTURO Background A pilot social assessment was conducted during preparation to obtain inputs from the main beneficiaries of PROFUTURO - children and teachers- and to strengthen the project's conceptual framework, particularly defining the terms of reference for the future social assessment. Objectives and Methodology of the Pilot. Using a rapid appraisal methodology (focus groups and in- depth interviews), children and teachers from rural and urban schools in, and surrounding, Tegucigalpa, were consulted about: (a) learning in schools, including areas of interest, what they like and dislike in schools, and their perceptions about what is lacking in schools; (b) Honduran history, Honduran heritage, and cultural identity and diversity; and how these views are linked with their expectations in the future; (c) their perceptions on pre-Hispanic civilizations; and (d) their leisure options and recreational areas. The consistency of results revealed that the methodology is adequate to understand the modal evaluation, values, and aspirations of potential beneficiaries. With the support of the Ministry of Education, three urban (one private and two public) and two rural public schools were visited to conduct interviews with teachers and hold group discussions with students. About fifty children were consulted in eight focus groups; each of them made up of three girls and three boys. Age ranged from seven to sixteen years old. Five informal interviews with teachers of both primary and secondary level of education were held. As expected, age and location - urban or rural - are closely related to how children express themselves. Younger children in rural schools tended to be the most timid of all with strangers and the most monosyllabic when discussing the proposed agenda. In contrast, older children (about 12-16 years old) in urban private schools are talkative and at ease when talking to strangers. Nonetheless, there is a striking similarity of some of their views about certain issues, for example, Honduran history and the Mayas. Main Results Schools. Children like school. As shown in the social assessment for the El Salvador Basic Modernization I Project', children feel the need for a place that they define as theirs and that is different from home - which they may like but is their parent's place. Schools are the space children identify as their own. In schools they feel important because is a place they can socialize with other children, though at the same time, satisfy their need for individualization and belonging. This feeling makes more difficult for them to be negative about school. Schools play different roles in children's life, not all of them related to education and learning. Girls learn to be girls, boys learn to be boys, friendships develop, games are played. No matter how poor schools are or inadequate the teaching they provide, if those other functions are performed, students will still be happy. Basically, children do not approve of what they think will disrupt that sense of dignity they gain by going to schools (as fights, violence, scratches in the wall); conversely, they like everything that reinforces the role they expect schools should play in their lives: games, friends and leaning. Junho Pena, Valeria (1995) Social Assessment: El Salvador Basic Education Modemization Project. LATEN Dissemination Note # 13, The World Bank. Page 24 Box 1. What do children like and not like in schools? I like field trips ...to play football during break-time ... to do manual work. (8-year-old boys and girls from non-poor urban schools) I do not like children scratching the school walls ...children fighting in the classroom... (8 year-old girls from poor urban school) I do not like to write a lot...to look up up many words in the dictionary. (8-year-old boys from poor urban school) When asked about what school lacks, non-poor urban students mention: more computers to help them with their school tasks, more videos, materials for arts and craft activities, more musical instruments for their band. The poor urban and rural students, on the other hand, unanimously answer the same question by saying "nothing." Only when asked about specific items, as for example, whether they have drawing materials, they mention that they do not have notebooks, erasers, and glue. Given the above-mentioned reasons, the lack of these materials does not affect children's appreciation and the positive visions of their schools. Teachers' perceptions about what is lacking in school ratify what children mention. Teachers from private schools remark that the pedagogic material is outdated, and they need more modem materials such as maps, books, and videos. On the other hand, teachers from rural and poor urban schools mention the lack of basic pedagogic material such as chalk, paper, textbooks, and pencils. Although teachers describe the learning methods as being obsolete and teacher-centered, rather than child-centered, they agree that students show eagemess to learn. Students stress their interest in mathematics, social sciences, and natural sciences, Spanish, English and artistic activities. When asked about their interest in history they report having knowledge about world history such as ancient cultures, the industrial revolution and the French revolution and their Honduran history. Box 2. What do children like? I like to go to school to play. (8-year-old boys from rural school) I like to learn mathematics because it is important to know how to add and multiply....Because it is easy. (9-year-old girlfrom urban school) I like sciences because I learn about human body. (9-year-old boyfrom urban school) (I like) social studies because we learn about the world and where Honduras is located ... Because I learn about the rivers and the valleys. (8-year-old boys and girls from urban school) I like to learn the history of our ancestors ...I like to learn about the Mayas, what they ate, how they lived, and about their gods. (12-year-old girls and boys from urban school) I like Computer Science; I am in my second year of Computer Science Baccalaureates. (16-year-old female student in a private school) Page 25 History and Heritage. For children, the Honduran past is a compilation of facts transmitted by history textbooks. They refer to their ancestors and heroes in the same way they refer to the Egyptians and other cultures they are being taught. When they were asked about what they know about their history, they stress the Maya culture and the Spanish domination. However, they do not seem to establish links between those two elements as part of their history formation. The same happens with other ethnic groups who played a role in the country formation. The past is neither linked to the present or to the fiture. Only students from the non-poor urban school were able to verbalize about how they perceive the future of their country and their people. One student said, "... in the near future Honduras is going to face a severe ecological problem." She mentioned that the main causes are the destructive exploitation of the country's natural resources. When students from the poor schools were confronted with questions about the future, they simply laughed and did not answer. Children refer to the Maya with veneration, as if they were deities rather than human beings. The Maya are described as being very talented and superior regarding their knowledge and uses of advanced techniques in agriculture and construction. This may explain why the children of Honduras, although aware of the progress that the Mayas achieved as a civilization, do not seem to identify with them. In fact, they report that they would like to know more about the Maya's everyday activities, such as, how did they care for their children, how did they prepare their meals, how did they live, and what were their gods like. In the mean time, the Mayas are perceived as the "other," a culture childrenr mirror to evaluate theirs as inferior. In contrast to the admiration that they demonstrate regarding the Maya, children show concern for Honduras, and for themselves as Hondurans, whom they described as being conformists. Children said: "The Mayas were brilliant, glorious, admirable and with a great artistic talent," "We are conformists, and we do not like challenges," "The main concern of the richer is becoming richer and the poor will become poorer because of their passivity." Leisure Options and Recreational Areas. There are few leisure options for children in Tegucigalpa. Most of the poor stay home or play in the streets, whereas the non-poor reported more options such as visits to parks (e.g. Picacho, Obrero), cinema and countryside excursions. Children seldom mention other cultural options such as the theater and music events (there are some bands and orchestras in Tegucigalpa). Visits to museums (there are a few in Tegucigalpa) occur as part of school excursions. Teachers explain that museums are not as appealing to children because they can only see, not play. According to them, exhibits are not presented in a way that stimulate children's curiosity; they cannot be touched, and do not have anything to do with children's reality. Particularly, the Museum of the Presidency is mentioned as an example that shows dresses of the recent ex- First Lady. They also mention that parents are not in the habit of taking their children to museums probably because this is considered the school's responsibility. Box 3. What do children do when they are not in school? I go to church ... I go the park "El Picacho." (ten-year-old girls and boys from non-poor urban school) I go to Burger King. (six-year-old boy from urban non-poor school) I play football in the street. (twelve-year-old boyfrom poor urban school) I do not go out because my parents are busy. (eight-year-old girls from rural school) I go to visit my relatives and play with my cousins. (ten-year-old boy from rural school) Page 26 Recommendations: For the ILC. Based on the findings mentioned above, children have an innate potential that is not fully developed as a result of the limited array of educational and cultural opportunities available for those who are poor and/or rural; and the lack of awareness of how children can be motivated in the case of non poor. Thus, the design of the ILC should consider the following recommendations: - Create more value-added entertainment that will serve as a complementary tool for formal education. - Create interesting exhibits that stimulate curiosity, motivate learning, and enhance self-esteem, by increasing creativity, broadening children's horizons and increasing their understanding of their world. - Create programs that facilitate the identification of children with the Mayas, and promote the value of the richness of cultural diversity. - Organize classes and workshops for teachers designed to provide learning options that support the work of educators and expand teaching techniques, as well as activities that children could take back to their classroom. - Organize an education guide that contains pre- and post-visit activities to be sent in advance to the scheduled visits to the ILC. TOR for the future Social Assessment: - Considering that, according to the pilot social assessment, children do not link their present with the social events and actors of the past, the social assessment should confirm this finding, explain the factors that account for this limited vision, and propose a new teaching strategy that could permit children to learn how history influenced their present and what is their role in it. - Identify and analyze options that permit the intemalization of the Mayas' achievements in children's everyday life. - Although the pilot social assessment did not find gender disparities or differences that should be considered, the social assessment should analyze the demands and opportunities of both women and men regarding the issues mentioned above. The following activities would be undertaken: (i) an anthropological study about what 215 century children should learn from pre-Hispanic cultures; (ii) an analysis about the vision of Honduran children on history, environment, education arid science; (iii) an analysis about the vision of Honduran children and teachers on sustainable development; and (iv) a consultation with children, teachers and parents on ethnic diversity and the main issues related to education, particularly informal education. The methodological tools for carrying-out the social assessment are as follows: (i) secondary data review: special attention should be given to history textbooks; (ii) semi-structured interviews with key informants; (iii) focus group meetings with students, teachers, and parents; and (iv) essays by students. Page 27 Annex 4: Estimated Project Costs (in US$ million) Honduras: PROFUTURO Proiect Comvonent Local Foreign Total 1. Sustainable Development Resources 2.1 Interactive Learning Center 2.2 2.2 4.4 2.2 Pre-Hispanic Contribution 0.2 0.2 0.4 2.3 Archaeological Parks Subprojects 1.4 - 1.4 Subtotal 3.8 2.4 6.2 2. Capacity Building and Communication 0.7 0.8 1.5 3. Project Implementation Unit 0.8 0.3 1.1 Total Baseline Cost 5.3 3.5 8.8 Physical Contingencies 0.2 0.2 0.4 Price Contingencies 0.0 0.1 0.1 Total Project Cost 5.5 3.8 9.3 Page 28 Annex 5: Procurement and Disbursement Arrangements Honduras: PROFUTURO Procurement There is no up-to-date Country Procurement Assessment Report (CPAR) for Honduras and no comprehensive review of local regulatory and institutional framework for procurement was conducted. The Honduran Council of Science and Technology (COHCIT) through its Project Implementation Unit (PIU) will have the overall responsibility for procurement. This is the first IDA project for COHCIT. Its administrative unit is very small and has three staff: one administrator, one accountant, and one assistant with little experience on projects financed by multilateral organizations. COHCIT is currently implementing an Organization of American States (OAS) project, where procurement is done mostly under local shopping procedures. A PIU will be established for the management of the project. The PIU coordinator and accountant have been recently selected. A procurement specialist familiar with IDA procedures has also been hired to handle and coordinate all procurement activities. IDA procurement courses will be available for the PRU staff and on-the-job training will also be provided. The construction of the ILC will be the main procurement activity of the project ($3.2 million). Therefore, the GOH has agreed to transfer the procurement responsibility of the construction and supervision of the ILC to the Ministry of Civil Works, Transport and Housing (SOPTRAVI) in view of their experience with IDA procurement procedures. SOPTRAVI has an implementation unit that has worked already with several projects funded by IDA and IDB. This unit will be responsible for the bidding process and supervision of the construction. The PIU Procurement Specialist will coordinate the planning and preparation of the engineering studies and bidding documents with SOPTRAVI and will receive on-the-job training from this unit. Procurement training will also be part of the training program that will be offered to the ILC staff. It is recommended that a procurement unit be established in the ILC for managing all ILC property, goods and materials. Procurement Arrangements (Table A). All procurement will be done in accordance with IDA's guidelines on procurement of goods, works, and using standard contract documents acceptable to IDA (Guidelines: Procurement under IBRD Loans and IDA Credits, January 1995, revised January/August 1996and September 1997 and January 1999; and Guidelines: Selection and Employment of Consultants by World Bank Borrowers, January 1997, revised September 1997 and January 1999). Civil works consist of the construction of the ILC and small rehabilitation works at priority archaeological parks. The estimated building area for the ILC is 4,000 m2, and the estimated cost is $3.2 million. International Competitive Bidding (ICB) will be carried out for this contract using IDA's Standard Bidding Document for small works. National Competitive Bidding (NCB) procedures satisfactory to IDA will be used for rehabilitation works expected to cost between $150,000 and $1,500,000, up to an aggregate amount of $300,000. For rehabilitation works below $150,000, up to an aggregate amount of $1,100,000, procurement will be done under lump-sum, fixed price contracts awarded on the basis of price quotations. Goods to be procured under the project ($1.4 million) consist of diverse elements for the exhibits of the ILC; such as toys, tools, handicrafts, learning material, electronic equipment, computers and software. No ICB is anticipated. NCB procedures satisfactory to IDA will be used for contracts estimated to cost above $25,000 up to an aggregate amount of $96,000. Contracts estimated to cost below $25,000 would be procured through international shopping or national shopping procedures, based on price quotations from at least three suppliers. Page 29 Consultant services under the project ($2.5 million) will follow Quality-Cost Based Selection procedures. Table A. 1 shows the different consulting assignments: the architectural design and supervision of the construction of the ILC, design of the exhibits, design of the training plan for the staff ILC, external auditors for the project accounts, the promotion campaign, the development of an archeological site management plan, and several individual consultants for the PIU's operation up to an aggregate amount of $1.3 million). The preliminary conceptual architectural design will be done through open competition and the evaluation will be based on quality. Terms of reference including detailed evaluation criteria will be developed and agreed with IDA. An evaluating committee will be formed and members of the Honduran Architects Association will be included. The participants will be required to submit technical and financial proposals at the same time in separate envelopes. Technical proposals will be evaluated and only the financial proposal of the consultant that ranks first in the evaluation of technical proposals will be opened. If an agreement is not reached during the negotiation of the financial proposal, the financial proposal of the second ranked technical proposal will be opened. Prior review thresholds (Table B). The level of IDA's prior review of procurement for this project is 54.1 percent, which covers (a) the ICB for the construction of the ILC, (b) the first NCB contract for goods, (c) the first NCB contract for works, (d) the first contract under international/national shopping, (e) consultant contracts with consulting firms above $100,000, (f) consultant contracts with individuals above $30,000; and (g) any sole-source contract. Disbursement Allocation of loan proceeds (Table C). Disbursements will be made against the categories of expenditures indicated in Table C. The proceeds of the proposed credit are expected to be disbursed over a period of 3 years. The project closing date is expected to be October 30, 2002. Use of statements of expenses (SOEs): Disbursements will be made on the basis of full documentation for all expenditures made under contracts requiring prior review by IDA, and contracts whose value will be raised above the prior review limits as a result of amendments. For all other expenditures, disbursements will be made against SOEs: (a) contracts for works costing less than $150,000 equivalent; (b) goods costing less than $25,000 equivalent; (c) contracts for consulting firms costing less than $100,000; (c) contracts for individual consultants costing less than $30,000; and (d) training expenses. SpecialAccount: In order to facilitate project implementation, the PIU will establish a special account in US dollars at the Central Bank with an authorized allocation and initial advance of $850,000, corresponding to the average of four months expenditures that are expected to be made from the account. The PIU will submit the request for replenishments on a monthly basis, or when 25 percent of the authorized allocation has been used, whichever occurs first. The replenishment application will be supported by the necessary documentation: a bank statement of the Special Account and a reconciliation of the Special Account against bank records. The Special Account will be audited in conjunction with the annual financial audit of the project accounts. Audit The PIUJ will have the records and accounts of the project for each fiscal year, including the Special Account, audited by independent and qualified external auditors, in accordance with generally accepted auditing standards and procedures, and terms of reference satisfactory to IDA. Certified copies of the audit reports will be submitted to IDA no later than June 30 of each year. Retroactive Financing IDA will finance expenditures incurred after October 12, 1998. The amount of the retroactive financing will not exceed 10 percent of the total credit amount. Page 30 Annex 5: Table A: Project Costs by Procurement Arrangements (in US$million equivalent) Expenditure Category Procurement Method Total ICB Other N.B.F. 1. Works 3.2 1.5 4.7 (2.7) (1.3) (4.0) 2. Goods 1/ 1.3 1.3 . - ~~(1.1) (I. 1) 3. Consultant Services 2 - 2.5 - 2.5 ________________________ - (2.5) - (2.5) 4. Training 3/ - 0.7 - 0.7 - (0.7) - (0.7) 5. Recurrent Costs - - 0.1 0.1 TOTAL 3.2 5.9 0.1 9.3 _______________________ (2.7) (5.7) (8.3) Note: Figures in parenthesis are the amounts to be financed by the IDA credit N.B.F. = Non-Bank financing 1/ Goods to be procured by NCB, international/national shopping (three quotations). 2/ Consultants Services will be procured under QCBS procedures. See Table A. 1. 3/ Training consists of study tours, registration in courses, and other related expenses. Page 31 Annex 5: Table Al: Consultant Selection Arrangements (in US$million equivalent) Selection Method Total Consultant Services _ Cost QCBS QBS SFB LCS CQ Other N.B.F. A. Firms a) Promotion campaign X 0.5 b) Architectural Design of ILC X 0.2 c) Supervision of ILC X 0.2 Construction d) Auditing X 0.03 e) Research on Pre-Hispanic X 0.2 practices, scientific knowledge f) Archeological Sites X 0.2 Management Plan B. Individuals a) Promotion Campaign X 0.1 b) Social Assessment X 0.05 c) Architectural plan X 0.05 d) Exhibits Designs X 0.1 e) PCU staff X 0.4 f) Short-term consultants to X 0.2 assist ILC and PIU g) Plan of ILC Activities X 0.1 h) Archeological Sites X 0.2 Management Plan _ _ Total 2.5 Note: QCBS = Quality- and Cost-Based Selection QBS = Quality-based Selection SFB = Selection under a Fixed Budget LCS Least-Cost Selection CQ = Selection Based on Consultants' Qualifications Other = Selection of individual consultants (per Section V of Consultants Guidelines), Commercial Practices, etc. N.B.F. = Not Bank-financed. Page 32 Annex 5: Table B: Thresholds for Procurement Methods and Prior Review Expenditure Contract Value Procurement Contracts Subject to Category (Threshold) Method Prior Review / Estimated Total Value Subject to Prior Review US $ US $ millions 1. Works All ICB Yes- ($3.2 m) 150,000-1,500,000 NCB First ($0.150) < 150,000 Lump-sum, fixed First ($0.05) price contracts 2. Goods >25,000 NCB First ($0.03 m) <25,000 International/ First ($0.02 m) National Shopping 3. Consultant Services With firms >100,000 Lump-sum service All ($0.4) contracts <100,000 44 Only TORs With individuals >30,000 Service contracts All ($0.5) <30,000 ; Only TORs Total value of contracts subject to prior review: 4.5m. Page 33 Annex 5: Table C: Allocation of Loan Proceeds Expenditure Category Amount in US$ million Financing Percentage 1. Civil Works (a) ILC building 2.4 83% (b) Emergency Archaeological Subprojects 0.4 95% (c) Archaeological Management Plan Subprojects 0.9 95% 2. Goods 1.1 100% of foreign expenditures; 88% of local expenditures 3. Consultant Services 2.5 100% 4. Training 0.7 100% 5. Unallocated 0.3 Total 8.3 Note: No recurrent cost would be financed with the credit proceeds. Page 34 Annex 6: Project Processing Budget and Schedule Honduras: PROFUTURO A. Project Budget (US$000) Planned Actual $50,000 B. Project Schedule Planned Actual Time taken to prepare the project (months) 3 months 3 months First IDA mission (identification) 07/30/1998 07/22/1998 Appraisal mission departure 10/01/1998 10/05/1998 Negotiations 11/04/1998 04/20/1999 Planned Date of Effectiveness 08/18/1999 Prepared by: Honduran Council of Science and Technology (COHCIT) Preparation assistance: Swiss Trust Fund, Gender Operational Fund IDA staff who worked on the project included: Name Specialty Mark Cackler Sector Leader, LCC2C Shelton Davis Lead Specialist, LCSES Maria Valeria Pena Task Manager, LCSES Genaro Alarc6n Counsel, LEGLA Teresa Roncal Procurement Analyst, LCSES Enrique Vanegas Financial Analyst, LCSFP Olympia Icochea Gender Specialist, LCSPR Kathryn Johns Swartz Operations Analyst, LCSES Madalena dos Santos Sr. Education Specialist, LCSHD Augusta Molnar Sr. NRM Specialist, LCSES Juan David Quintero Sr. Environmental Specialist, LCSES Maria Geigel Task Assistant, LCSES Marie Claude Haxaire Administrative Assistant, LCSES Peer Reviewers Thomas Blinkhorn Lead Operations Specialist, ECSHD Frank Method UNESCO Advisers Robert Crown Projects Adviser, LCOQE Juergen Franz Sector Leader, LCC2C Page 35 Annex 7: Environmental Analysis Honduras: PROFUTURO Environmental Aspects 1. The construction of the ILC will not generate any significant negative environmental impacts because of the type of plot selected, area available, and urban location, however, construction activities would probably be of some concern. Although it is located in an urban neighborhood, the area is relatively isolated from residences and other businesses. Thus, there will be no inconveniences or nuisances within the community during construction. On the other hand, the project itself provides excellent opportunities for environmental enhancement and the promotion of environmentally sustainable technologies and concepts. These enhancement opportunities can be built into the design and construction of the ILC and will reinforce the focus on sustainable development that was adopted for the facility. Environmental Considerations for the Engineering Design 2. The engineering design of the ILC should take into consideration: (i) the connection of the ILC to the potable water system and the capacity of the existing water distribution network; (ii) the connection to the sewerage network and the need for capacity expansion for receiving collectors; (iii) the treatment of wastewater from cafeterias and restaurants before being discharged to the sewerage networks (iv) the adequate management of runoff and the facilities for its recollection and evacuation, keeping in mind the existing downstream systems; (iv) the systems for recollection, storage and transportation of solid wastes generated in the LLC, incorporating the structures for separation and recycling; (v) appropriate access systems for pedestrians, municipal and inter-municipal buses, bicycles and handicapped people; (vii) alternatives for managing the informal or street sellers at the entrance of the ILC; and (viii) avoiding the use of materials such as wood from tropical forests, lead-based paints, asbestos, for example. Environmental Enhancement 3. The architectural design of the ILC brings many opportunities to incorporate and reinforce the criteria of environmental sustainability that will be promoted by the ILC. The feasibility of incorporating these aspects into the design should be analyzed during the conceptualization phase of the architectural designs and during the engineering designs. This analysis should include inter alia: (i) solar panels to satisfy totally or partially the electricity needs of the ILC, with proper back-up systems; (ii) rain water storage for the irrigation of gardens and green zones; (iii) recycling waste waters for irrigation; (iv) separation of the potable water systems from irrigation systems; (v) maximizing natural light in order to minimize artificial light needs; (vi) planting native species in gardens and green areas and incorporating these in the activities of the ILC with pedestrian walkways (showing children native species, names and importance of these species); (vii) using windmills for groundwater exploitation for irrigation water; (viii) natural ventilation systems, minimizing the necessities of air conditioning (even though some modules like the computer interactive center, projection rooms, etc. will need these systems); and (ix) the stabilization of slopes using vegetative measures. 4. Many of the above concepts are part of in-country initiatives such as the non-conventional energy sources that are promoted by the Ministry of Natural Resources and Environment (SERNA). Based on their hands-on knowledge of the environmental situation in Honduras, the Ministry has offered their collaboration to contribute conceptual ideas to the architectural design of the ILC regarding issues of non- conventional energy, national environmental problems and solutions. The preparation of the basis for the architectural conceptual designs will be consulted with the Sub-secretary of the Environment. Page 36 Environmental Management of Construction Activities 5. Construction activities could cause important impacts and nuisances to surrounding areas. These impacts merit careful planning of construction activities and the application of strict environmental measures during construction. Among the aspects that should be kept in mind are: (i) pedestrian safety and traffic congestion during construction due to the increase of heavy traffic (of the construction itself and from traffic detours) in high traffic avenues and exit ramps; (ii) dust and particulate materials, causing nuisances to surrounding businesses; (iii) undesirable noise levels due to the machinery and equipment; (iv) degradation of lateral streets due to heavy equipment machinery and traffic detours; (v) the interruption of services (water, electricity, telephone, urban buses) during construction; (vi) the adequate disposal of garbage, metals, used oils, excess materials, generated during construction; and (vii) the necessity of informing the population about construction and work schedules, interruption of services, traffic detour routes, provisional bus routes, and pedestrian security measures during construction. 6. The design of the ILC will then consider: (i) the preparation of environmental specifications that the contractor should follow during the construction of the ILC, within the identified lineament; and (ii) the constructive design and activity programming keeping in mind the minimization of impacts and trouble to the population. Environmental Supervision during Construction 7. The supervision of the construction will include compliance with the Operational Manual and the environmental specifications by the contractor. Environmental Measures during the Operational Phase 8. During the operational phase of the ILC, adequate provisions should guarantee: (i) the maintenance of the systems of collection and treatment of waste waters; (ii) the adequate collection and disposal of solid waste, incorporating recycling systems and the separation of materials; and (iii) the maintenance of complimentary systems (solar panels, wind mills, etc.). The engineering design should include the preparation of operational manuals and maintenance of all systems. Page 37 Environmental Management of the ILC's Design, Construction and Operation 9. The following table presents the different phases of the construction process, identifying the agency or organization responsible and the environmental considerations that should be included in each phase. Table 1. Construction Phases, Responsible Party, and Environmental Requirements Phase Responsible Party Environmental Requirements Basis for PIU will hire a consultant with The terms of reference for the biding competition on biding of expertise on this type of architectural design must include the conceptual conceptual projects. The Ministry of environment requirements as well as consideration on architectural Environment and Natural environment enhancement (see paragraph 3). design Resources (SERNA) will be consulted about programs or initiatives related to their agenda, as a result; they will be able to provide support or represent such programs in the ILC. _ Preliminary The basis for the selection of an The preliminary project must take into consideration the Architectural architectural firm will be made environment criteria and must include environmental Project from a preliminary architectural enhancement concepts (see paragraph 4). competition. It is recommended that the jury include environment specialists. The preliminary project will be presented to SERNA for their =_________ evaluation Engineering The consulting firm or the same Engineering design should include the preparation of Design firm of prior architectural environmental manual and specifications for the design. The environment contractor (see paragraph 6). manual for the contractor must be based on similar manuals already existing in SOPTRAVI. Construction The construction contractor Contractor should follow environmental manual and must be selected through specifications (see paragraph five). international competition biding. Supervision Consulting Firm Technical supervision of the project should include supervision of compliance with the environmental manual of the contractor and the environmental optimization efforts. The terms of reference for contracting the work supervisor must include assuring compliance with all environmental aspects (see paragraph 7). Operation PROFUTURO Foundation The operation must guarantee the maintenance of all environmental systems (see paragraph 8). Annex 8: Status of Bank Group Operations in Honduras Operations Portfolio As of 24-May-99 Difference Between expected Original Amount in US$ Millions and actual Fiscal disbursements a/ Project ID Year Borrower Purpose IBRD IDA Cancellations Undisbursed Orig Frm Rev'd Number of Closed Projects: 44 Active Projects HN-PE-48651 1999 GOVERNMENT OF HONDURAS FHIS IV 0.00 45.00 0.00 16.33 -29.00 0.00 HN-PE-64083 1999 REPUBLIC OF HONDURAS HURRICANE EMERGENCY 0.00 200.00 0.00 195.53 23.15 0.00 HN-PE-7398 1997 GOVERNMENT OF HONDURAS RURAL LAND MGMT 0.00 34.00 0.00 27.35 10.03 5.06 HN-PE-34607 1996 REPUBLIC OF HONDURAS PUB SEC MOD TAC 0.00 9.60 0.00 3.02 2.20 0.00 HN-PE-37709 1996 GOVERNMENT-HONDURAS SOC INV FUND III 0.00 30.00 0.00 1.57 -.19 0.00 HN-PE-7387 1996 REPUBLIC OF HONDURAS PUB SEC MOD SAC 0.00 115.70 0.00 27.84 1.71 7.41 HN-PE-7396 1995 GOVERNMENT OF HONDURAS ENVIRON. DEVELOPMENT 0.00 10.80 0.00 5.67 5.38 4.99 HN-PE-7399 1995 GOVT OF HONDURAS BASIC EDUCATION 0.00 30.00 0.00 19.48 15.10 0.00 HN-PE-7388 1993 GOVERNMENT OF HONDURAS TRNSPRT SCTR RHB 0.00 85.00 0.00 23.63 2.83 1.71 HN-PE-7392 1993 GOVERNMENT NUTRITION/HLTH 0.00 35.40 0.00 10.20 -.78 0.00 Total 0.00 595.50 0.00 330.62 30.43 19.17 Active Projects Closed Projects Total Total Disbursed (IBRD and IDA): 246.33 1,078.41 1,324.74 of which has been repaid: 0.00 515.54 515.54 Total now held by IBRD and IDA: 595.50 551.79 1,147.29 Amount sold 0.00 4.46 4.46 Of which repaid : 0.00 4.46 4.46 Total Undisbursed : 330.62 0.00 330.62 a. Intended disbursements to date minus actual disbursements to date as projected at appraisal. Note: Disbursement data is updated at the end of the first week of the month and is currently as of 30-Apr-99. Honduras STATEMENT OF IFC's Committed and Disbursed Portfolio As of 31-Mar-99 (In US Dollar Millions) Committed Disbursed IFC IFC FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi Partic 1995/98 Elcosa 8.28 2.64 3.50 21.62 8.28 2.63 3.50 21.62 1997 Cressida 15.00 0.00 10.00 37.00 15.00 0.00 10.00 37.00 Total Portfolio: 23.28 2.64 13.50 58.62 23.28 2.63 13.50 58.62 Approvals Pending Commitment Loan Equit-Y Quasi Partic 1998 CAMINO REAL PLAZ 10.00 0.00 0.00 0.00 1998 CRESSIDA BLINC 0.00 0.00 0.00 7.00 Total Pending Commitment: 10.00 0.00 0.00 7.00 Annex 9: Financial Management System Action Plan Honduras: PROFUTURO No. WEEKLY ACTIVITIES 1 2 3 4 5 6 7 8 9 10 11 12 ACCOUNTFNG MODULE P = _ _ I ANALYSIS AND DESIGN OF ACCOUNTING BOOKS= ,.=====_= 2 ANALYSIS AND DESIGN OF MODULE._ DISBURSEMENT MODULE I ANALYSIS _ = = E = = __ = __ ___ U 2 DESIGN =c=o= r S S = = == = = eD 3 INSTALLATION AND TESTING 4 TRAINING 5 PAYMENT FOR MODULE PREPARATION BUD1GET MODULE 2 DESIGN 3 INSTALLATION AND TESTING 5 PAYMENT FOR MODULE PREPARATION LACI REPORTS MODULE 2 DESIGN_______ _ m 3 INSTALLATION AND TESTING 5 PAYMENT FOR MODULE PREPARATION _ _ __ m Page 41 Annex 10 Honduras at a glance Latin POVERTY and SOCIAL Arnerica Low- Honduras & Carib. income Development diamond* 1997 Population, mid-year (millions) 6.3 494 2,048 Life expectancy GNP per capita (Atlas method, US$) 700 3,880 350 GNP (Atlas method, USS billions) 4.4 1,917 722 Average annual growth, 1991-97 1 Population (YO 3.0 1.7 2.1 Labor force (%) 3.8 2.3 2.3 GNP Gross per primary Most recent estimate (latest year available, 1991-97) capita enrollment Poverty (%l of population below national poverty line) Urban population (% of total population) 45 74 28 Life expectancy at birth (years) 67 70 59 Infant mortality (per 1,000 live births) 43 32 78 Child malnutrition (%6 of children under 5) 18 12 .. Access to safe water Access to safe water (% of population) 65 73 71 Illiteracy (% of population age 15+) 27 13 47 Gross primary enrollment (% of school-age population) 111 111 91 -H onduras Male 110 .. 100 Low-income group Female 112 .. 81 KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1976 1986 1996 1997 Economic ratios' GDP (US$ billions) 1.3 3.8 4.1 4.7 Gross domestic investmentUGDP 19.2 13.9 30.4 30.0 Trad Exports of goods and services/GDP 33.7 26.0 43.1 42.7 rae Grossdomesticsavings/GDP 14.8 11.5 24.8 25.5 Gross natonal savingslGDP 10.5 7.0 22.3 24.5 Current account balance/GDP -8.8 -6.9 -8.1 -5.5 Domestic Interest payments/GDP 1.6 3.0 3.7 3.6 mesticn Investment Total debtGDP 35.5 78.1 111.1 100.0 Savigs Total debt service/exports 13.1 28.5 27.0 21.3 l Present value of debt/GDP .. Present value of debtexports .. Indebtedness 197646 1987-97 1996 1997 1998-02 (average annual growth) GDP 2.7 3.4 3.7 4.9 2.9 1 -Honduras GNP per capita -0.9 0.5 1.3 2.6 0.3 Low-income group Exports of goods and services 2.1 1.8 8.1 1.0 2.8 1 STRUCTURE of the ECONOMY 1976 1986 1996 1997 Growth rates of output and investment(%) (% of GDP) 40 Agriculture 28.5 20.6 22.3 22.6 40 Industry 23.2 23.5 30.8 30.2 30 Manufacturing 15.1 14.3 18.1 18.0 210 Services 48.2 55.9 47.0 47.1 _ Private consumption 72.3 74.2 61.9 61.9 10 92 3 94 96 General govemment consumption 12.9 14.3 13.3 12.6 -DI -OGDP Imports of goods and services 38.2 28.3 48.7 47.2 197646 1987-97 1996 1997 Growth rates of exports and imports (%) (average annual growth) Agriculture 2.3 3.5 2.5 3.2 15 T Industry 3.2 3.9 2.9 7.6 104 . Manufacturing 2.5 3.6 4.6 9.3 Services 3.2 3.2 3.6 4.8 ° 96- Private consumption 2.9 3.1 5.5 6.6 5 t General government consumption 2.9 -2.6 5.3 -1.9 -10 Gross domestic investment -3.2 9.5 -5.9 -0.4 -15 Imports of goods and services -0.8 3.5 2.4 -1.9 - Exports alImports Gross national product 2.7 3.5 4.3 5.6 Note: 1997 data are preliminary estimates. The diamonds show four key indicators in the country (in bold) compared with its income-group average. If data are missing, the diamond will be incomplete. Page 42 Honduras PRICES and GOVERNMENT FINANCE Domestic prics 1976 1986 1996 1997 Inflation (%) (% cha ge 40 Consumer prices .. 4.2 23.8 20.2 30 Implicit GDP deflator 8.5 3.9 22.4 22.7 20 Government flnance 10 (% of GDP, includes current grants) Current revenue .. 22.0 31.0 31.3 92 93 94 95 96 97 Current budget balance .. 0.7 5.8 6.9 - GOP deflator --*-CPI Overall surplus/deficit .. -5.3 -3.6 -1.3 TRADE (US$ millions) 1976 1986 1996 1997 Export and import levels (USS millions) Total exports (fob) .. 894 1,423 1,536 2,500 Bananas .. 257 280 212 Coffee .. 322 279 327 2.000 Manufactures 1,500 Total imports (cif) .. 962 1,882 2,103 1M000 Food . . 151 234 255 Fuel and energy 97 246 236 s Capital goods .. 172 448 528 o 91 92 93 94 95 99 97 Export pnce index (1995=100) * 98 97 103 Import price index (1995= 100) .. 86 100 92 U Exports * Imports Termsoftrade(1995=100) .. 113 97 111 BALANCE of PAYMENTS (US$ mnillions) 1976 1986 1996 1997 Current account balance to GDP ratio (%) Exports of goods and services 454 1,012 1,758 2,007 o Imports of goods and services 514 1,076 1,989 2,216 -2 Resource balance -80 -64 -231 -209 -4 Net income -58 -211 -236 -204 - Net current transfers 0 13 136 153 -'* Current account balance -118 -263 -331 -260 -1211 Financing items (net) 156 292 424 540 -14 + Changes in net reserves -38 -30 -93 -280 ,31 Memo: Reserves including gold (US$ millions) .. 118 283 591 Conversion rate (DEC, localUUSS) 2.0 2.0 11.7 13.0 EXTERNAL DEBT and RESOURCE FLOWS 1976 1986 1996 1997 (US$ millions) Composition of total debt, 1997 (USS millions) Total debt outstanding and disbursed 479 2,975 4,533 4,698 IBRD 67 465 350 275 G:482 k 275 IDA 30 81 424 496 2 _ B49| Total debt service 61 299 564 505 F:499 c:46 IBRD 7 56 89 73 IDA 0 1 5 5 Composition of net resource flows Official grants 9 146 141 159 Official creditors 56 99 33 348 Private creditors 42 14 70 3 E: 1,368 :1532 Foreign direct investment 5 30 90 114 Portfolio equity 0 0 0 0 World Bank program Commitments 49 37 60 54 A-IBRD E - Bilateral Disbursements 15 33 52 95 B - IDA D - Other multilateral F - Prvate Principal repayments 2 22 61 52 C-IMF G - Short-term Net lows 12 11 -9 43 1 _ Interest payments 5 36 33 26 Net transfers 8 -25 -42 17 Development Economics 3/1/99 Page 43 Annex 11: Documents in the Project File Honduras: PROFUTURO A. Project Implementation Plan (Operational Manual) B. Articles Brown, J., "Just Beyond the Classroom: Community Adventures for Interdiciplinary Learning." Situated Learning Lecture 3. ED 388485. Children's Museums "Museums defined," Childhood Education, Spring 1995. Farmer, D., "Children Take Learning into their Own Hands," Childhood Education; v71 n3 p- 168-69 Spring 1995. Hall, B., "Parent behind Growth in Children's Museums," The New York Times" Wednesday, July 22, 1998 A16. Hammonds, K., "Dig into Community Resources," Instructor; v104 nl p 72-74 July-Aug 1994 1994. Harrison, M., "Education and Activities", Education in ILCs, 1988. Klein, J., The Political Scene "In God They Trust," New Yorker, June 1997. Lewin, A., "Just Beyond the Classroom: Community Adventures for Interdiciplinary Learning" From Theory to Practice, Introduction. ED 388485. The Maya World. Available on line at: htpp:// www.mayanet.hn/Copan /English/culture/Culture.htm.(July 1998). The Mayas Available on line at: htpp:// www.mayanet.hn/Copan /English/culture/Culture.htm. (July 1998). "Professional Practices in Children's Museums, including Recommended Standards for Professional Practice and Self-Study Questions," Association of Youth ILCs, 1992. Shepherd, B., "Childhood's Pattern: Appropriation by Generation" Children's Museums and the Appropriation of Culture. Shorris, E. II., "As a Weapon in the hands of The Restless Poor on New York's Lower East Side." Harper's Magazine/September 1997. A Stroll Through Copan Available on line at: htpp:// www.mayanet.hn/Copan /English/Pictures/A-stroll.htmn. (July 1998). Templeton, M., "The Role of Informal Education: An evening exploring the exhibits at Capital Children's Museum." How we Think and Learn. Lectures series. 1991 ED348138. C. Children's Museums in America Canadian Children's Museum. Available on line at: htpp://www.civilization.ca/cmc/cmceng/cmeng.html (July 1998). Costa Rica Children's Museum, Available on line at: htpp://www.worldheadquarters.com/cr/crarticlea.html (July 1998). Museo de los Nifios: Ciencia, Arte y Tecnologia, Caracas, Venezuela Gerencia de Relaciones Institucionales (1998). Museo de los Nifios. Bogota, Colombia. (1998). Museo del Nino de Bolivia. Available on line at: htpp://www.esperanto.com/Quipus/laika.htm#Museo (July 1998). Papalote/ Museo del Ninio/ Mexico. Available on line at: htpp://www.papalote.org.mx/pages/pres-t.html#quecont (July 1998). Page 44 D. World Bank Documents Honduras: Biodiversity in Priority Areas Project (Report 16859-HO) World Bank, Sept. 1997. Honduras: Proyecto FHIS III Evaluaci6n Social y Plan de Desarrollo de los Pueblos Autoctonos de Honduras (Indigeneous People Development Plan) March 1998 prepared by Ximena Traa-Valarezco. Honduras: Reforming Public Investment and Infrastructure Sectors. A Joint World Bank and Inter-Am6rican Development Bank Study, 1995. Investing in Culture: A View from the World Bank by Ismail Serageldin at UNESCO Symposium on Culture and Development (March 30, 1998). Project Appraisal Document for a Proposed Learning and Innovation Loan to Georgia for A Cultural Heritage Project, (Report No.17275-GE), World Bank, January 19, 1998. Report and Recommendations of the President of the International Development Association to the Executive Directors on a Proposed Agricultural Sector Adjustment Credit to the Republic of Honduras, (Report P-5923-HO), World Bank, July 14, 1993. Staff Appraisal Report Honduras: Basic Education Project.(Report 13791-HO) World Bank, March 8, 1995. E. Project Preparation Documents Comparaci6n de caracteristicas de las dos alternativas de terrenos para el museo de los nifios. Paper prepared by Luis de la Torre. Evaluaciones e Informes prepared by Luis de la Torre. Proposal-Honduras Cultural Inventory and Cultural Strategy prepared by Celina Albano. F. Legal Documents from Honduras Certificaci6n de la Fundaci6n Nacional de Parques. Estatutos Asociacion de Copan. Repuiblica de Honduras. Proyecto: "Punta de Lanza" "Aprender Creando" Repuiblica de Honduras Tegucigalpa, Honduras (Junio de 1998). G. Documents from COHCIT Actualizacion Diagnostico de la Ciencia y Tecnologia en Honduras, Vol 1 Proyecto Fortalecimiento del Desarrollo Cientifico y Tecnol6gico de Centro America y Panama (Dic 1997). Proyecto: Fortalecimiento del Desarrollo Cientifico y Tecnol6gico de Centro America y Panama (Dic 1997). Republica de Honduras Consejo Hondurefno de Ciencia y Tecnologia Organizaci6n de Estados Americanos. RepuTblica de Honduras Consejo Hondureflo de Ciencia y Tecnologia Organizaci6n de Estados Americanos. Anteproyecto: Indicadores Nacionales de Ciencia y Teenologia. Repuiblica de Honduras Consejo Hondurefno de Ciencia y Tecnologia Organizaci6n de Estados Americanos. Actualizaci6n Diagnostico de la Ciencia y Tecnologia en Honduras. Vol II Anexos. Proyecto Fortalecimiento del Desarrollo Cientifico y Tecnol6gico de Centro America y Panama (Dic. 1997). MAP SECTION IBRD 29839 B E L I Z E 16- A GU LA GRAC Y(R Lg COR L LAN MAYAGA ETHNICITY. Z_ -RANC C LENCAS (pop. 217,000) LIE, MISKITOS J ZAMBOS (pop, 40,000) CHORTIS (p.p. 1 7,000) CIGALPA Ns" a GARIFUNAS (pop. 175,000) TOLUPANES lpop. 120,500) EL SALVAD R PECH / PAYAS (pop. 2,700) TAWAHKAS / SUMOS (pop. 9161 a ENGLISH-SPEAKING BLACK (pop. 22,600) W% F., T,4-, P.h, 7-hk-d :-fll. L M,'pil.-M Ch.,; 5.- Thk.) C-p-li. (SETCO) m N I C A R A G U A NATIONAL CAPITAL RIVERS MUNICIPALITIES DEPARTMENT BOUNDARlES INTERNATIONAL BOUNDARIES MAY 1999