The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) REPORT NO.: RES38197 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF IMPLEMENTING EXTRACTIVE INDUSTRIES TRANSPARENCY INITIATIVE (EITI) APPROVED ON JUNE 8, 2017 TO MINISTRY OF ECONOMY, PLANNING AND DEVELOPMENT ENERGY & EXTRACTIVES LATIN AMERICA AND CARIBBEAN Regional Vice President: Axel van Trotsenburg Country Director: Tahseen Sayed Khan Global Director: Riccardo Puliti Practice Manager/Manager: Christopher Gilbert Sheldon Task Team Leader: Javier Aguilar The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) ABBREVIATIONS AND ACRONYMS CNEITI-RD National Multi-Stakeholder Group DR Dominican Republic EGPS Extractives Global Programmatic Support EITI Extractive Industries Transparency Initiative MSG Multi-stakeholder Group PDO Project Development Objective The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) BASIC DATA Product Information Project ID Financing Instrument P161434 Investment Project Financing Original EA Category Current EA Category Approval Date Current Closing Date 08-Jun-2017 24-Dec-2019 Organizations Borrower Responsible Agency Ministry of Economy, Planning and Development Ministry of Energy and Mines Financing (in USD Million) FIN_SUMM_PUB_TBL SUMMARY Total Project Cost 0 Total Financing 0 Financing Gap 0 DETAILS -NewFin3 Project Development Objective (PDO) Original PDO The proposed DO is to foster enhanced transparency and accountability in extractive industries by supporting the MEM on leading the implementation of the EITI in accordance to the Standard 2016. OPS_TABLE_PDO_CURRENTPDO The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) Summary Status of Financing Net TF Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-A5180 02-Jun-2017 02-Jun-2017 02-Jun-2017 24-Dec-2019 .20 .17 .03 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING 1. Overall, this activity has shown sustained progress on implementing the work program. The satisfactory rating from both the Project Development Objective (PDO) and Implementation Plan continue to reflect a sound implementation pace. The Extractive Industries Transparency Initiative (EITI) is seen as good practice in building trust around contentious issues such as mining revenues and granting licenses. 2. The EITI implementation in the Dominican Republic has made significant progress and is impacting the sector through: 3. EITI Reporting. With support from the EGPS grant, the Dominican Republic has made progress on making key information about the extractives industries under the EITI standard accessible to the public. The first EITI report published covers 2015 data and was submitted to the EITI International Secretariat in October 2017. It was officially launched at the Regional EITI LAC Conference held in Santo Domingo (https://eitird.mem.gob.do/primer-informe-eiti-rd-informacion- contextual/. This report has been approved by the National Multi-stakeholder Group (CNEITI-RD) according to minutes 37 and 38 https://eitird.mem.gob.do/actas-de-reuniones-de-la-comision-nacional/). The second report covers 2016 data and was published in December 2018 www.eitird.mem.gob.do; and https://eitird.mem.gob.do/segundo-informe-de-cotejo- 2016/. This report has been approved by CNEITI-RD according to minutes No. 57: https://eitird.mem.gob.do/actas-de- reuniones-de-la-comision-nacional/ and No. 46: https://eitird.mem.gob.do/actas-de-reuniones-de-la-comision- nacional/). The grant will cover the third EITI Report for 2017 and 2018, which is expected to be published by early 2020, and the fourth EITI report for 2019. 4. Dissemination. The EGPS grant also supported the design of a communications and dissemination strategy for EITI-RD. This strategy includes guidelines on how to make use of EITI data and was approved by CNEITI-RD. They would be implemented during the second phase of the EGPS grant, as reflected in minutes No. 41 (https://eitird.mem.gob.do/actas- de-reuniones-de-la-comision-nacional/). Throughout the EITI implementation process, the national secretariat has organized 12 different workshops and events for advancing dissemination of EITI data, including one workshop in the Bonao district. The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) 5. Stakeholder Engagement. Extractive industries stakeholders from different sectors such as the government, private sector, and civil society organizations have demonstrated strong interest in EITI through its sustained involvement. This is reflected in the CNEITI-DR minutes: https://eitird.mem.gob.do/actas-de-reuniones-de-la-comision- nacional/.https://eitird.mem.gob.do/actas-de-reuniones-de-la-comision-nacional/). The CNEITI-DR has prepared progress implementation reports that reflect the work done by the different participants. IPA 2016: https://eitird.mem.gob.do/ipa-2016/ IPA 2017: https://eitird.mem.gob.do/ipa-2017/ The CNEITI-RD has approved and published the Progress Annual Report for 2018 and available. https://eitird.mem.gob.do/wp- content/uploads/2019/07/20190628-INFORME-IPA-2018-VF.pdf 6. DR-EITI in currently being validated by the EITI international board, a process of independent assessment on how the standard has been implemented looking at 7 categories with a total of 33 requirements. It uses a scale for level of progress that runs from “no progress” to “beyond” for each requirement. The DR aims to achieve at least the level of “meaningful progress.” The validation started on January 1st, 2019 and should have been concluded in June 17 during the EITI International Conference to be held in Paris. At that time, an official communication of the results should have been released. During that period, a team from the International Secretariat has visited the DR and has collected information and shared a preliminary validation report with CNEITI-DR in March. Based on this report, the independent validator’s report identified some corrective actions that the CNEITI-DR has addressed and reported back to the International Secretariat. The validation awaits the decision of the EITI Council that will be taken at a future EITI International Board meeting around early 2020. 7. As of August 2019, an amount of US$170,000 had been disbursed, representing about 84 percent of the grant. The additional funds will finance an upgrade to DR-EITI’s reporting capacity. It will support activities related to: i) a feasibility study and technical solution for mainstreaming EITI reporting; ii) production of 2017 and 2018 EITI report, and production of 2019 EITI report; and iii) enhancement of the DR-EITI regulations and policy enhancing the disclosure of data (mainstreamed), plus the disclosure of beneficial ownership information. The project was extended for 6 months from its closing date on June 24, 2019. There are no outstanding audits for this grant. Project Financial Management arrangements are adequate and remain unchanged. II. DESCRIPTION OF PROPOSED CHANGES 8. On July 2, 2019, the Government requested an extension of closing date and additional funds in the amount of US $250,000. This restructuring is being processed to include US$250,000 additional funding. The original grant (TF A-5180- DO) will close as scheduled on December 24, 2019. The proposed additional grant in the amount of US$250,000 has a closing date of February 24, 2021. This will allow full implementation of the EITI work program, leading to the Dominican Republic’s international EITI validation. This is the second extension of the closing date. The first extension was necessary to allow processing time for the additional funds. The additional funds in the amount of US $250,000 is being provided to allow the Dominican Republic to upgrade its current progress for EITI implementation by financing strategic activities related to the EITI work program. These activities included mainstreaming the reporting process, capacity building for in- house production of EITI annual reports, and sustainable operations by the DR-EITI Secretariat. The existing project description, PDO, and monitoring indicators continue to be relevant and support the activities to be covered under the additional financing. This restructuring does not change the Environmental Assessment category and like the parent project does not trigger any safeguard policies. The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) 9. The detailed activities to be carried out through the additional financing will continue to facilitate quality control of information on extractives sector companies, keeping them in line with the EITI Standard. DR-EITI operations and production of the third EITI Report for 2017 and 2018 will be supported by these activities. This grant would also support the hiring of a consultant to advise the DR-EITI Secretariat team on producing the 2019 EITI report in-house (partially mainstreamed while the mainstreaming work takes place in parallel) by conducting a feasibility study and developing a technical solution for EITI mainstreamed reporting. A potential host platform for the EITI reporting process will be proposed. The technical solution will set out a proposed IT systems architecture, frequency of data flows, data exchange protocols, etc., for an upgrade of the current EITI Portal in line with the EITI Standard. This will also contribute to the development of a roadmap and a funding strategy for securing support for “EITI mainstreaming” implementation. In addition, regulations for disclosure of data will be enhanced. The DR-EITI website will be redesigned to include aspects for mainstreaming the EITI data (interim mainstreaming strategy). In addition, support for Multi-Stakeholder Group (MSG) training in relation to media engagement will be funded. 10. In order to reflect the additional activities supported through this restructuring, the results framework would include a new indicator defined as “online publication of the EITI Report 2019”. III. SUMMARY OF CHANGES Changed Not Changed Results Framework ✔ Components and Cost ✔ Loan Closing Date(s) ✔ Additional Financing Proposed ✔ Disbursement Estimates ✔ Procurement ✔ Implementation Schedule ✔ Implementing Agency ✔ Project's Development Objectives ✔ Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Disbursements Arrangements ✔ Change in Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Other Change(s) ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_RESULTS_TABLE RESULTS FRAMEWORK Project Development Objective Indicators PDO_IND_TABLE EITI report's recommendations on maintreaming transparency in the mining sector addressed by the MSG Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No No Yes Revised Date 19-Nov-2019 20-Dec-2018 24-Feb-2021 Intermediate Indicators IO_IND_TABLE The DR EITI Reports approved Unit of Measure: Number Indicator Type: Custom Baseline Actual (Current) End Target Action Value 0.00 1.00 3.00 Revised Date 29-May-2017 20-Dec-2018 24-Feb-2021 Communications strategy approved by the MSG Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No Yes Yes No Change Date 29-May-2017 20-Dec-2018 24-Jun-2019 Active and open multi-stakeholder engagement Unit of Measure: Yes/No The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) Indicator Type: Custom Baseline Actual (Current) End Target Action Value No Yes Yes No Change Date 29-Jun-2017 20-Dec-2018 24-Jun-2019 Online publication of the EITI report Unit of Measure: Yes/No Indicator Type: Custom Baseline Actual (Current) End Target Action Value No Yes New Date 19-Nov-2019 24-Feb-2021 OPS_DETAILEDCHANGES_COMPONENTS_TABLE COMPONENTS Current Current Proposed Proposed Cost Action Component Name Component Name Cost (US$M) (US$M) 1. Component A: EITI 1. Component A: EITI 50000.00 Revised 83000.00 Implementation Support Implementation Support 2. Component B: 2. Component B: 90000.00 Revised 92000.00 Communication and Outreach Communication and Outreach 3. Component D: Project 3. Component D: Project 60000.00 Revised 75000.00 Management Management TOTAL 200,000.00 250,000.00 OPS_DETAILEDCHANGES_LOANCLOSING_TABLE LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline TF Status Closing Closing(s) Closing for Withdrawal Applications TF-A5180 Effective 24-Jun-2019 24-Dec-2019 24-Feb-2021 24-Jun-2021 OPS_DETAILEDCHANGES_ADDITIONAL_FINANCING_TABLE ADDITIONAL FINANCING Source Currency Amount USD Equivalent Extractives Global Programmatic USD 250,000.00 250,000.00 Support(EGPS) The World Bank Implementing Extractive Industries Transparency Initiative (EITI) (P161434) Existing Net Commitment USD Amount 200,000.00 Total 450,000.00 OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE DISBURSEMENT ESTIMATES Change in Disbursement Estimates Yes Year Current Proposed 2017 0.00 0.00 2018 0.00 0.00 2019 0.00 50,000.00 2020 0.00 100,000.00 2021 0.00 100,000.00