73284 IDA16 Mid-Term Review IDA REGIONAL INTEGRATION PROGRAM: PROGRESS UPDATE AND REVIEW OF THE PROVISION OF GRANTS TO REGIONAL ORGANIZATIONS IDA Resource Mobilization Department Concessional Finance and Global Partnerships October 2012 ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities ACBF African Capacity Building Foundation ACE Africa Coast to Europe AFR Sub-Saharan Africa (Region) AfDB African Development Bank AICD Africa Infrastructure Country Diagnostic APL Adaptable Program Lending ATI Africa Trade Insurance Agency AU African Union AUC African Union Commission BEAC Bank of Central African States BOAD West African Development Bank CAADP Comprehensive Africa Agricultural Development Program CAS Country Assistance Strategy CCD Coordinating Country Director CDC Center for Disease Control CEMAC Economic Community of Central African States CMU Country Management Unit COMESA Common Market for Eastern and Southern Africa CSRP Sub-Regional Fisheries Commission DFID Department for International Development DPO Development Policy Operation EAC East African Community ECOWAS Economic Community of West African States ECSA-HC East, Central and Southern Africa Health Community EIB European Investment Bank EITI Extractive Industries Transparency Initiative EU European Union FCC Fragile and Conflict-affected Country FCFA Franc Communauté Financière Africaine (CFA Franc) FY Fiscal Year G20 Group of 20 GEF Global Environment Facility IAP Implementation Action Plan ICA Investment Climate Assessment ICT Information and Communications Technology IDA International Development Association IDF Institutional Development Fund IEG Independent Evaluation Group IFC International Finance Corporation IGAD Inter-Governmental Authority on Development MDGs Millennium Development Goals MIGA Multilateral Investment Guarantee Agency MTR Mid-Term Review MW Mega Watt NBA Niger Basin Authority NEPAD New Partnership for Africa‟s Development OHADA Organization for the Harmonization of Business Law in Africa OMVS Senegal River Basin Organization PDO Project Development Objective PIDA Program for Infrastructure Development in Africa PPA Program Partnership Arrangement PPF Project Preparation Facility PPP Public-Private Partnership QAG Quality Assurance Group REC Regional Economic Community RIP Regional Integration Program RIAS Regional Integration Assistance Strategy SACU Southern Africa Customs Union SADC Southern Africa Development Community SAPP Southern Africa Power Pool SDR Special Drawing Rights SSA Sub-Saharan Africa STI Sexually Transmitted Infections TTL Task Team Leader UEMOA West African Economic and Monetary Union UNHCR United Nations High Commission for Refugees USAID United States Agency for International Development WAAPP West Africa Agricultural Productivity Program WAPP West Africa Power Pool WDR World Development Report TABLE OF CONTENTS EXECUTIVE SUMMARY ........................................................................................................... i I. INTRODUCTION ................................................................................................................... 1 II. STRATEGIC CONTEXT ...................................................................................................... 1 III. REVIEW OF GRANTS TO REGIONAL INSTITUTIONS ............................................. 5 IV. UPDATE ON THE IDA REGIONAL PROGRAM .......................................................... 10 A. The IDA Regional Program Portfolio ................................................................................... 10 B. The Performance of the IDA Regional Program Portfolio ................................................... 12 C. Emerging Results of the IDA Regional Program .................................................................. 14 V. CONCLUSIONS AND ISSUES FOR DISCUSSION ........................................................ 18 ANNEXES Annex 1 – The IDA Regional Program Portfolio (as of October 2, 2012) ............................. 21 Annex 2 – IDA Regional Program Pipeline for FY13 ............................................................. 28 Annex 3 -- Currently Unfunded Regional Projects………………..…………………………30 TABLE Table 1 – Approved Regional IDA Grants to Regional Organizations ................................... 7 FIGURES Figure 1 – Rapid Increase in Commitments ............................................................................... 3 Figure 2 – Regional Portfolio by Sector .................................................................................... 10 Figure 3 – Growth in Annual Disbursements and Disbursement Ratio ................................ 12 EXECUTIVE SUMMARY i. During the IDA16 Replenishment negotiations, IDA Deputies and Country Representatives underscored that regional projects have, since IDA13, played a critical role in addressing regional challenges (including the provision of regional public goods) and helping to stimulate trade by connecting markets and developing cost effective infrastructure. Participants recognized that the IDA pipeline of regional projects has grown rapidly, reflecting an increase in demand particularly in Sub-Saharan Africa as well as in the other regions. They urged Management to strengthen efforts to implement the ongoing regional IDA portfolio and supported a further scale up of regional projects funds during the IDA16 period. Participants also noted the importance of working closely with regional entities, including the regional development banks. In this regard, they noted the continuation of the pilot program for grants-based support for regional organizations (which was approved during the IDA15 Mid Term Review – MTR) and requested that Management report on progress under this pilot at the IDA16 MTR. This paper provides a detailed update on IDA‟s regional grant pilot and the overall regional integration program. ii. Since its launch in IDA13, the IDA Regional Program envelope has grown from SDR304 million (US$435 million) to SDR1.5 billion (US$2.25 billion) in IDA16. For the IDA16 period, 75 percent of the resources (SDR1.125 billion) have been provided to Su-Saharan Africa where there is a significant need and demand for regional projects, while the remainder (SDR375 million) targets growing demand in other regions. To date, SDR0.9 billion (US$1.3 billion) have been committed from the IDA16 regional envelope to support total commitments to regional projects (including from country IDA allocations) of SDR1.3 billion (US$1.9 billion), and it is expected that the remaining resources will be fully committed well before the end of IDA16. About half of the portfolio commitments and the projected pipeline are targeted towards Fragile and Conflict-affected Countries (FCCs). Demand for regional projects continues to increase and the pipeline for the IDA16 period is over-programmed. iii. The regional IDA portfolio reflects the strategic areas where regional solutions can spur economic growth and contribute to the poverty reduction agenda. In financial terms, the bulk of the portfolio remains concentrated in regional connective infrastructure namely energy, transport, information and communication technology (ICT) and water resources development (irrigation and multipurpose dams). To leverage infrastructure investments, a strong program of analytical, advisory, capacity building and investment activities has been implemented to unlock bottlenecks to trade and investment, facilitate the flow of goods and services along regional infrastructure platforms, and enlarge markets. Significant investments have also been made in support of regional public goods such as cross-border disease management, agricultural productivity, and wildlife and environmental protection. iv. The regional grant pilot introduced in IDA15 enables the capacity enhancement of regional institutions that play a key role in promoting regional solutions, and that perform critical functions to enhance the implementation of regional projects financed by IDA. Regional grants are capped at 10 percent of the regional IDA envelope for each region and are provided to ii entities that meet specific eligibility criteria.1 To date, nine regional grants have been approved in the total amount of US$106.9 million. In addition to information on the utilization of the regional grant window, this paper also identifies lessons learned and recommends adjustments to the regional grant pilot program going forward. v. Implementation performance of regional IDA portfolio has improved steadily in recent fiscal years. The disbursement ratio, a proxy for implementation pace, has climbed from 6 percent at the end of FY08 to an all time high of 17 percent at the end of FY12. These improvements are all the more notable given the complexity of regional projects, the rapid rise in cumulative commitments – from US$2.4 billion at end FY08 to US$6.5 billion by October 2, 2012 – and a consistently low average project age due to the high number of new deliveries in the portfolio. vi. To accelerate progress on regional program results the Bank will continue to strengthen management oversight and operational support in legal and fiduciary aspects to address implementation bottlenecks and organization for results. Country Directors are playing a key role in the management of regional integration work and ensuring effective integration of regional initiatives in CASs, and ensuring the proper dialogue and follow-up at the country level – a critical aspect in moving forward on the regional integration agenda. vii. A key feature of IDA’s Regional Program is the focus on leveraging external and internal partnerships and support, including from the private sector. To date, the program has leveraged over US$3.1 billion in co-financing and parallel financing. Partnerships with other donors, including the private sector and civil society, will continue to be prioritized to complement IDA interventions, to address other priorities of the regional integration agenda which are not directly addressed in the IDA program and to develop constituencies for reform. Collaboration with the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) is also expanding, leveraging private financing to complement regional IDA infrastructure investments. In addition, IDA has also employed a range of instruments to support partnerships in regional projects, including Partial Risk Guarantees, advisory services on Private-Public Partnerships (PPPs), and project preparation financing. Furthermore, infrastructure development and improvement of the business climate in partnerships with regional institutions and civil society have been strengthened. viii. Going forward, work on regional integration will focus on three priorities: (1) increase the selectivity and strategic orientation of the regional project pipeline by supporting highly transformative projects in terms of potential outcomes and by leveraging diversified instruments including Program for Results (PforR), guarantees, IBRD enclave financing and Public Private Partnerships (PPPs); (2) sustain the momentum of improvements in the active portfolio on regional integration; and (3) continue to build capacity of regional institutions to accelerate implementation of the regional integration agenda. This will help ensure the continued support to this important agenda, and that results are achieved with the funding provided. 1 See IDA (2009) “Review of the IDA Regional Program�, page 24. I. INTRODUCTION 1. IDA countries are increasingly recognizing that collaborative actions and regional approaches are critical to stimulating trade by connecting markets and developing cost effective infrastructure that can spur not only faster growth, but also the competitiveness required to participate in the global economy. Countries, Regional Economic Communities (RECs) and specialized regional institutions, as well as regional development organizations, are developing strategic regional frameworks and building capacity to pursue regional integration across various regions. There is a growing demand to scale up regional solutions with a greater focus on mainstreaming regional issues in national planning, tackling the climate change agenda, regional infrastructure and the missing links, economic integration, and regional public goods. IDA‟s regional program is crucial to the effort to moving the regional integration agenda forward, in close collaboration with the member states and other development partners. 2. The purpose of this paper is to provide an update on the implementation of the regional grant pilot and the overall regional integration program. Section II of the paper presents the strategic context and Section III provides information on the use of the regional grants to regional organizations, as well as lessons learned, and suggested revisions to the program going forward. In view of the growing importance of the overall regional integration program, Section IV provides an overview of the current status of the program, including the recent gains in terms of implementation and emerging results with a focus on the larger portfolio in the Sub-Saharan Africa region, and highlights the expansion of support to other regions. Section V sets out conclusions and issues for discussion. II. STRATEGIC CONTEXT 3. IDA countries are increasingly realizing the benefits from pursuing regional integration solutions to development challenges, including: i) reaping economies of scale or other efficiencies by acting collectively in the pursuit of common national objectives to increase local supply capacity and improve access to markets and suppliers; ii) integrated or harmonized treatment of trans-boundary issues such as trade, regulatory frameworks and policies, regional infrastructure and other cross border issues including public goods; and iii) management of shared natural resources. These examples illustrate the potential benefits that can be achieved by countries embracing regional integration solutions, in particular for those that have small economies and populations and that are land-locked. Small countries find it difficult to fund the large fixed costs associated with major infrastructure, a challenge that can be addressed by pursuing regional approaches. Linking markets can unlock the benefits of agglomeration and scale economies and create a mutually reinforcing process that spreads investment opportunities and growth beyond current centers of development. For example:  The potential savings from regional power trade in Sub-Saharan Africa could amount to about US$2 billion per year in the costs of power systems development and operation, and increased power trade between African countries could potentially save 70 million tons a year of carbon emissions. Regional power trade can also result in a cleaner -2- development path from reduced carbon emissions by locating power generation in countries with large hydro potential and exporting to neighboring countries rather than developing separate and less efficient national systems. In addition, in South Asia, Bhutan‟s exports of hydropower to India already contribute about 60 percent of state revenues, while transmission projects under implementation (Nepal-India and India- Bangladesh) and preparation (Central Asia-South Asia and Pakistan-India) can potentially result in annual savings of US$0.8-1.0 billion (through displacing costly oil- based power generation) and create the foundations of a regional grid and electricity trading system. Furthermore, regional power trade could support efforts to overcome critical development bottlenecks in post-conflict and land-locked countries (e.g., Afghanistan and Tajikistan) to reduce poverty and promote regional peace and stability.  Only about 4 percent of Sub-Saharan Africa‟s population has access to the internet, compared to the world average of 22 percent. In addition, where access is available, it can cost up to ten times more than in other continents, because many African countries still rely on expensive satellite links, rather than broadband. Countries that link to the growing network of submarine fiber optic cables and regional terrestrial backbone networks can more than halve their costs of international communications. The Bank‟s portfolio is rapidly increasing on regional Information and Communications Technology (ICT) and currently covers three sub-regions.  Regional integration through better connective infrastructure is particularly important for land-locked countries since their economic potential is inherently linked to the interests and conditions of their neighboring countries. Typically, a land-locked country in Sub- Saharan Africa has 50 percent higher transport costs and 60 percent lower trade volumes than a typical coastal economy. High costs and unreliability of transport corridors are caused not only by the poor physical condition of roads, railways and ports, but also by inefficient customs and port clearance practices resulting in transporting freight across borders being a long, inefficient and uncertain process. A 20 percent reduction in border crossing time alone could generate 10-15 percent savings in transport prices in Southern Africa.  Water resources do not respect national boundaries and effective management therefore requires regional collaboration. Sub-Saharan Africa is home to more than 60 trans- boundary river basins, almost half of which are shared by three or more countries. When well managed, water resources offer potential for generation of low-cost hydropower, expansion of irrigation and transport, sustainable fisheries, flood management and recreational and tourism opportunities. Where water is poorly managed, seasonal hydrologic variability and limited storage leave economies vulnerable to floods and droughts, while pollution, erosion and overfishing reduce agricultural productivity, destroy critical habitats and allow the spread of disease and contamination of drinking water. Similar challenges exist in other regions, such as the Mekong River Basin in East Asia and Pacific and the Aral Sea in Europe and Central Asia.  Regional approaches are also important in many other regional public goods, such as disease prevention, climate change adaptation and mitigation, a coordinated approach to -3- wildlife protection, tertiary education and governance. IDA‟s support is also increasing on these important aspects, including through an innovative Regional Disaster Vulnerability Reduction Program in the Caribbean, and a Regional Wildlife Protection Program in South Asia.  Finally, regional approaches will be integral to alleviating poverty and causes of conflict in many parts of the developing world. For example, in South Asia, cross-border connectivity and market integration will be a key element of any strategy to boost growth and equality in the lagging, landlocked/border areas which are both conflict prone and home to an estimated 50 percent of the region‟s poor people. 4. The IDA16 Replenishment provides for both increased financing and more flexible policies. Specifically, the IDA16 Report provides that regional integration projects covering only two member states would qualify for support, as long as one of the participating IDA countries is a Fragile and Conflict-affected Country. The increased flexibility is well aligned with the IDA16 Special Themes and the World Development Report (WDR) 2011 on Conflict, Security and Development. The two-country criterion has not yet been used because FCCs tend to participate in larger regional programs, although it would facilitate the preparation of future pipelines. In fact, IDA support on regional integration in FCCs has increased over the past years and more than half of the committed resources, and about half of the projected pipeline investments, are for FCCs. 5. The demand for resources to support regional integration projects has increased significantly in the past few years, as Heads of State and regional institutions are increasingly embracing regional solutions. The theme of the African Union (AU) Heads of State Summit in Ethiopia in July Figure 1. Rapid Increase in 2012 was “Boosting Intra-African Trade�, Commitments demonstrating the focus on regional integration and Annual comm. (LHS) Cumulative comm. (RHS) intra-regional trade in Sub-Saharan Africa. The regional 1,400 (US$m) 8,000 integration portfolio has grown rapidly, nearly doubling 1,200 7,000 in size over the last four years from US$2.4 billion in 1,000 6,000 FY08 to US$6.5 billion by October 2, 2012 (see Figure 800 5,000 4,000 1). In fact, for the Sub-Saharan Africa region, the 600 3,000 IDA16 regional resources have been fully committed or 400 2,000 are slated for delivery by end FY13, with no remaining 200 1,000 0 0 funding for FY14. Furthermore, there is increased FY08 FY09 FY10 FY11 FY12 FY13 to demand for regional IDA funding in the other regions, date including in South Asia and Europe and Central Asia regions, where projected financing for the Central Asia-South Asia Regional Electricity Transmission Project alone requires US$1 billion, while the IDA allocation for the entire IDA16 period for the South Asia region is about US$200 million. This demonstrates the tremendous demand for regional IDA resources, as well as the country buy-in and ownership in pursuing regional solutions. Overall, there is a standby list of projects that already amounts to over US$2 billion ready to move ahead should additional resources become available (see Annex 1 for the active project list, Annex 2 for the FY13 pipeline, and Annex 3 for the unfunded pipeline). -4- 6. In Sub-Saharan Africa, IDA’s support to regional integration is guided by the Regional Integration Assistance Strategy (RIAS), which was endorsed by the Executive Directors in April 2008. In April 2011, a Progress Report of the RIAS was presented to the Executive Directors, highlighting the progress to date, lessons learned, alignment with the new Sub-Saharan Africa strategy and the way forward. The Executive Directors noted the progress and endorsed the main thrust of the strategy and adjustments to align it to the Africa Strategy. The RIAS consists of three main pillars and one cross-cutting theme:  Regional infrastructure, with a focus on: a) expanding and upgrading selected trade corridors and transport networks; b) improving access to clean energy and supply reliability; and c) improving telecommunication connectivity. Assistance to trade corridors and transport networks will have a special focus on improving the connectivity of land-locked countries.  Economic integration, with a focus on: a) reducing tariff and non-tariff barriers to intra- regional trade; b) implementing customs unions and free trade agreements; c) improving regional environments for business, investment and industrial cooperation; d) developing regional financial markets, and related institutions; and e) developing regional dimensions of initiatives to improve governance and financial management.  Regional public goods, with a focus on: a) improving management of shared water resources; b) raising agricultural productivity (including research and knowledge sharing); c) improved collaboration and preparedness to respond to trans-boundary pandemics and other infectious diseases; and d) regional rationalization of research and tertiary education to strengthen regional knowledge assets and technical capacity.  Strengthening regional strategic planning and connections with national development plans, with a focus on: a) capacity enhancement of the RECs and specialized regional institutions; and b) strengthened connection between regional policy commitments and national planning. 7. In the other regions – South Asia, Latin America and Caribbean, Europe and Central Asia, and East Asia and the Pacific – the programs are guided by regional and country strategies, as well as country demand in order to select key strategic opportunities to support regional integration. There is increased demand for regional IDA resources in each sub-region. The active and pipeline portfolio is closely aligned with the country strategies, as well as sector and regional development bank strategies. Responding to improving cross-border relations in South Asia, the Bank‟s emerging strategy follows a two-pronged approach, with one prong fostering the creation of a more facilitative environment for regional economic cooperation (through analysis, dialogue, and creating regional networks of practice/knowledge in development areas of common interest); and the second prong supporting the preparation and financing of cross-border projects (aligned with country strategies), using these projects for confidence and capacity building. The strategy relies on leveraging the private sector, which is an emerging force for regional cooperation, working across regions (especially Central Asia- South Asia), and partnering with the International Finance Corporation, the Asian Development Bank, the Islamic Development Bank and other development partners (the UK, USA and -5- Australia are already providing important assistance). It also seeks to strengthen the institutional capacity of the South Asian Association for Regional Cooperation (SAARC) including with the two-year old SAARC Development Fund. In the other regions, new projects will continue to be identified through a selectivity process, ensuring that projects are well aligned with Bank and client strategies, as well as with regional development partners, in particular the regional development institutions and regional development banks. 8. IDA assistance to regional initiatives utilizes three main instruments: i) financing and advisory services for regional investment programs; ii) knowledge transfer through technical assistance and analytical work to inform financing support and advocacy; and iii) partnerships to leverage additional resources from internal partners (IFC and MIGA), as well as external development partners and the private sector. In addition, the Bank focuses on capacity building support for regional institutions, which is being provided through the regional grant window. 9. The Bank has fully engaged in the G20 process which continues to build important consensus internationally on the importance of infrastructure investments to catalyze economic growth and improving human development. The recommendations of The High Level Panel on Infrastructure to the G20 in 2011 were organized around three main areas, namely: i) the need to ensure a strong and sustainable supply of bankable projects through more project preparation finance; ii) better enabling environments to support more private sector investment; and iii) making more finance available through the development of domestic markets and further innovation in risk mitigation. III. REVIEW OF GRANTS TO REGIONAL INSTITUTIONS 10. In IDA15, the IDA Deputies endorsed the provision of grants directly to regional entities that are associated with IDA regional operations. Funding for these grants was capped at 10 percent of the envelope for regional integration. This important measure allows IDA to provide enhanced support to regional institutions performing a key role in the implementation and/or facilitation of regional projects. In order to build on progress achieved during the IDA13 to IDA15 period on the regional integration program, the IDA16 Report further scaled up support to regional integration, in particular to increase the support provided to regional institutions. The regional grants can be awarded to regional entities that are associated with IDA regional operations and that meet specific criteria concerning their legal status and fiduciary and operational capacity. 11. To access regional grants, recipients are required to fulfill six eligibility criteria, in addition to the overall eligibility criteria for regional IDA support. It was envisioned that most of the grant funding would go to technical regional organizations with coordination or regulatory functions in infrastructure, trade, finance, agriculture, environment and natural resource management, as well as health. The eligibility criteria for access to regional grants are provided below. -6- 1. The recipient is a bona fide regional organization that has the legal status and fiduciary capacity to receive grant funding and the legal authority to carry out the activities financed. 2. The recipient does not meet eligibility requirements to take on an IDA credit. 3. The costs and benefits of the activity to be financed with an IDA grant are not easily allocated to national programs. 4. The activities to be financed with an IDA grant are related to regional infrastructure development, institutional cooperation for economic integration, and coordinated interventions to provide regional public goods. 5. Grant co-financing for the activity is not readily available from other development partners. 6. The regional entity is associated with an IDA-funded regional operation involving some of the participating member states. 12. To date nine regional grants have been approved in the total amount of US$106.9 million to build technical and operational capacity to implement regional programs, lead regional dialogue and foster cooperation among countries (see Table 1). The grants have been identified, reviewed and prepared taking into account selectivity and eligibility criteria, as well as ensuring that the proposed regional grants are aligned with Bank strategies on regional integration. The regional grants are prepared either as a component within a larger regional project, or as a separate project or phase of an adaptable program loan, depending on the objective of the regional grant. In both cases, standard quality assurance is ensured during the preparation period (including on fiduciary, safeguards and legal matters), and all regional grants are approved by the Executive Directors. The identification of potential recipients is conducted in each sub-region through dialogue with country and regional counterparts, as well as with other development partners. This process helps to target regional grants on regional organizations where there is a clear funding gap and where all the eligibility criteria are satisfied. So far, regional grants have been awarded in four regions supporting important initiatives that enhance the implementation of the regional IDA portfolio. Closed regional IDA grants will be reviewed and assessed as with any IDA financed project. This will be captured as part in the Implementation Completion and Results Reports (ICRs) and reviews to be conducted by the Independent Evaluation Group (IEG), as well as other reviews. These findings and lessons learned will be instrumental in guiding the development of future regional grants, as well as providing important feedback to senior management on the progress of the regional grant program. 13. Although it is too early to report detailed results from approved regional grants, given that most of these were approved in FY11-FY13, some of them are starting to show positive progress. It should be further noted that some of the regional grants have faced effectiveness delays, since they were processed as part of larger regional programs. Furthermore, some of the regional grant recipients are new to implementing IDA-financed projects, and therefore require more time at the early stages, in particular to ensure that the fiduciary and safeguards requirements are followed. Despite these challenges, many of the regional grants are beginning to increase the implementation pace. -7- Table 1: Approved Regional IDA Grants to Regional Organizations US$ m Project Recipient Description (FY) Provide support to the MRC to facilitate the member countries in Mekong Integrated nurturing technical cooperation on water resources management, Mekong River 8.0 Water Resources and carrying out priority activities in the key tributaries of the Commission (MRC) (FY12) Management MR Basin in the respective countries, contributing to the improved management of shared water and related resources. Strengthen regional hydromet services and countries‟ ability to work together to develop products and services that can be Central Asia Executive Committee mutually beneficial. It will strengthen institutional capacity of Hydrometeorology of International Fund EC-IFAS and its Regional Center of Hydrology to ensure 8.7 Modernization for Saving the Aral interoperability/synchronization between national (FY11) Project Sea hydrometeorological services and allow the regional institution to facilitate the efficient exchange of hydromet data in an integrated regional network. Strengthen institutional and technical capacity of WAPP West Africa Power West Africa Power Secretariat and infrastructure investments to ensure 26.2 Pool Program APL3 - Pool (WAPP) interoperability/synchronization between national power grids, (FY12) Phase I Secretariat allowing the secretariat to facilitate the efficient exchange of electricity across an integrated regional power network. Capacity building of EAC to facilitate financial sector integration Financial Sector and deepening in East Africa (financial inclusion, harmonization Development and East African of laws and regulations, mutual recognition of national 16.0 Regionalization Community (EAC) supervision agencies, integration of market infrastructure, (FY11) Project development of regional bond market, capacity building at regional and national level). Enhancing CTU's capacity and support its role in implementing Caribbean Regional Caribbean this regional project, particularly in increasing cross-country Communications 3.0 Telecommunications coordination, harmonization of pro-competition policies and Infrastructure FY12 Union strategies, and transfer of knowledge among the participating Program countries. West Africa Regional Capacity enhancement support to the CSRP (West Africa 2.0 Fisheries APL1 CSRP Fisheries Commission) to scale up planned investments in a (FY11) Additional Financing regional fisheries information system and research program. Capacity building support for improved and sustained management of ACBF's operations and financing of technical ACBF Regional Africa Capacity assistance sub-grants to improve institutional capacity for public 25.0 Capacity Building Building Foundation policy formulation related to: (i) regional economic cooperation (FY11) Project (ACBF) and integration and provision of regional public goods; ii) economic policy analysis and development management; (iii) and financial management, accountability and transparency. Strengthen OHADA‟s institutional capacity to support OHADA Improved coordinated investment climate reforms in its member countries 15.0 Investment Climate OHADA in West and Central Africa, including improved corporate (FY12) Project financial reporting Niger Basin Water Enhance the capacity of the Niger Basin Authority to sustainably Resources Dev. and Niger Basin manage regional water resources and implement regional 3.0 Sustainable Authority (NBA) activities under the Niger Basin Water Resources Development (FY13) Ecosystems and Sustainable Ecosystems Management program. Management (II) Total 106.9 -8- 14. The West Africa Fisheries Commission (CSRP) was one of first recipients of a regional grant to support the implementation of the West Africa Regional Fisheries Program. This program covers six countries (Cape Verde, Ghana, Liberia, Sierra Leone, Senegal and Guinea-Bissau) in West Africa to support the sustainable management of regional fisheries and to increase local revenues from the fisheries trade. As the Project implementing entity of the regional components of the Regional Fisheries Program, the CSRP benefitted initially from resources from IDA and the Global Environment Facility (GEF) made available by the participating countries on a non-reimbursable basis. Given its critical role in the introduction a regional information system for the management of the participating countries‟ fisheries, the CSRP was extended a US$2 million regional grant to enhance its capacity and facilitate and coordinate implementation of the Regional Fisheries Program (US$100 million) at the regional level. The CSRP will work with the six participating countries to develop and introduce a regional fisheries dashboard to track fishing licenses and fees and to monitor the status of both national and shared fishing stocks to inform policy making and quota schemes across the region. This process is already well advanced, and will have a major impact on the overall regional fisheries by introducing principles of transparency to the sector based on the Extractive Industries Transparency Initiative (EITI). 15. IDA has also provided a regional IDA grant in the amount of US$25 million equivalent to support the Africa Capacity Building Foundation (ACBF). The ACBF is a regional partner in capacity development, which has a long history of working closely with regional institutions, including the RECs. The ACBF focuses on supporting: (i) the development of independent think tanks and policy institutes to enhance the evidentiary basis for policy- making in Sub-Saharan Africa; and (ii) African institutions of higher learning to provide quality training and prepare cadres for the civil service. Apart from the costs associated with the institutional development of the ACBF itself, the grant allows ACBF to finance technical assistance sub-projects to enhance the institutional capacities of beneficiaries in: (i) economic policy analysis and development management; (ii) financial management, accountability and transparency; (iii) national statistics and statistical systems (to support decision-making); and (iv) regional economic cooperation and integration, and the provision of regional public goods. So far, thirteen sub-projects have been approved by the ACBF, including for COMESA. 16. In May 2012, the West African Power Pool (WAPP) an international organization that associates all public and private power entities in the member states of the Economic Community of West African States – ECOWAS) received a regional grant in the amount of US$26.2 million equivalent to facilitate the implementation of the regional electricity market of the West Africa Power Pool Program (US$430 million). The objective of the regional grant to be implemented by the WAPP General Secretariat is to increase the technical integration of the WAPP network by enhancing the synchronization of the WAPP transmission network through the installment of equipment in a number of power utilities in the ECOWAS region, to enhance such trades and to provide technical assistance to the WAPP to ensure better operation of networks. The direct beneficiaries of this support are the power utilities in the ECOWAS region, which will benefit from more efficient electricity trades, in turn rendering their own operations more efficient. It further aims to speed up WAPP project implementation by strengthening its Planning, Investment Programming and Environmental Safeguards (PIPES) Department and the Information and Coordination Center and enhance capacity. Technical assistance will also -9- include supporting the certification process of network operators and will assist the development of standardized market operating rules for the WAPP market zone. 17. In the Europe and Central Asia region, the Executive Committee of the International Funds for Saving the Aral Sea is the recipient of a regional grant in the amount of US$8.7 million to support the implementation of the Central Asia Hydrometeorology Modernization Project. The purpose of the regional grant is to improve the accuracy and timeliness of hydrometeorology services in Central Asia, with particular focus on the Kyrgyz Republic and Tajikistan. The regional grant is still early in implementation, but already high level delegations from Kazakhstan, the Kyrgyz Republic, Tajikistan and Uzbekistan have undertaken a study tour to China for knowledge sharing in July 2012 to: i) bring key government agencies and technical specialists from the four participating countries together to share experiences and to facilitate better regional communication; ii) learn from the experience of peers in better linking hydromet services with early warning systems (better disaster risk reduction) and better service orientation to the end users to ensure sustainability; and iii) facilitate understanding from the key government agencies on the importance of hydromet services. 18. The provision of IDA grants to regional institutions has been instrumental to support the regional integration program, and in particular institutions that play a critical role in the implementation of regional programs. There is strong demand for these scarce resources, and the Bank has followed strict selectivity criteria in determining which clients to support. This level of review and assessment will continue in order to ensure that IDA support is closely coordinated with support provided by the regional development banks, as well as other development partners. For example, a number of development partners provide funding support to the RECs, in particular on capacity enhancement programs. Any proposed funding to the RECs will therefore be discussed by the various donor coordination groups, to ensure that the funds are provided where there are evident financing gaps on the regional integration agenda. 19. The demand for financial support from regional institutions is growing rapidly. Given the complexity of regional integration operations, demand for capacity building support for implementing agencies and regional institutions is growing. This includes demand from regional institutions that may not be directly associated with ongoing regional IDA investments, but still have a critical role to play in policy reforms and drive the agenda on regional integration in the various sub-regions. At this time, IDA cannot support these institutions given that criterion #6 for eligibility to regional grants states that the recipient institution must be associated with an existing regional IDA operation. Therefore, Management proposes to revise criterion #6 on accessing regional grants, in order to allow regional institutions that are not directly associated with an existing regional IDA-financed project, but still perform an important and critical role in moving the regional integration agenda forward, to also be able to access grant funding. IDA will continue to be very selective, and will support only regional institutions that will help to move forward critical aspects of the regional integration agenda. For example, for the Africa region, any potential regional grant will need to be closely aligned with the strategic objectives of the RIAS, and to demonstrate how the regional grant will contribute to this effort. Therefore, the following revised articulation of grant criterion #6 is proposed: - 10 - “The regional entity is associated with an IDA-funded regional operation or otherwise supports the strategic objectives of IDA on regional integration�. The overall regional funding criteria, and the six detailed eligibility criteria will continue to be used to determine eligibility for proposed regional grant recipients and the total amount of resources allocated to regional grants will still be limited to 10 percent of the overall regional integration IDA allocation. CFP and the regions will ensure that these criteria are strictly followed, as well as the selectivity process, taking into account the scarce resources available, the high demand for such resources, and closely scrutinizing the “regional� nature of the operation proposed to be financed by the regional grant to ensure it dovetails with a regional – not just multi-country – agenda of the region. IV. UPDATE ON THE IDA REGIONAL PROGRAM A. The IDA Regional Program Portfolio 20. The Regional IDA envelope has been scaled up from SDR304 million (US$435 million) in IDA13 to SDR 1.5 billion (US$2.25 billion) for IDA16. For the IDA16 period, 75 percent of the resources (SDR 1.125 billion) have been provided to Sub-Saharan Africa where there is a significant demand for regional projects, while the remainder (SDR 375 million) targets growing demand in other regions. To date, Figure 2. Regional Portfolio by SDR1.3 billion (US$1.9 billion) have been Sector committed from the IDA16 envelope, and it is expected that the remaining resources will be fully Environment 3% Governance committed well before the end of IDA16. About Health & Capacity 1% Building half of the portfolio commitments and the projected Finance 1% pipeline are targeted towards Fragile and Conflict- Agriculture 2% Energy affected Countries. & Fisheries 9% 38% 21. The portfolio reflects three strategic Resources Water pillars: regional infrastructure, institutional Development 8% cooperation for economic integration, and regional public goods. In financial terms, the bulk Information & Communication of the portfolio is concentrated in regional Technology 13% connective infrastructure, namely energy, transport, Trade & ICT and water resource development (irrigation Transport Facilitation and multipurpose dams). These categories 25% comprise about 84 percent of total commitments, reflecting the high costs and strong demand for infrastructure investments. Significant investments have also been made in agricultural productivity and environmental protection. Economic integration and trade facilitation have also been a key focus, requiring intensive efforts to unblock political economy and logistics infrastructure constraints, but requiring relatively small amounts of IDA financing. 22. Beyond financing infrastructure development, a prominent feature of the IDA regional program is to promote institutional and policy reforms. The eligibility criteria of - 11 - the program emphasize high levels of regulatory and policy harmonization so that regional projects generate broader benefits beyond infrastructure. In project design, the enabling environment and capacity building are generally important components among the project activities. For example, in light of international experiences for achieving successful ICT sector development to support growth, regional ICT operations include participation conditions to promote open access, competition, and private sector participation, and technical assistances are typically provided to develop a supportive regulatory and policy environment. In addition, through knowledge sharing across countries, IDA regional projects have also promoted cross- country and cross-region learning. For instance, successes and lessons learned from regional ICT projects in Sub-Saharan Africa have benefited developments of similar projects in the Caribbean and Pacific islands. 23. Furthermore, while continuing to support Sub-Saharan Africa, the IDA regional program has also strengthened support to small island economies to help address their unique development challenges. In the Pacific islands, for example, an FY12 regional aviation program has provided about US$49 million additional regional IDA resources for Kiribati, Tonga and Tuvalu to support coordinated airport investments, adoption of common safety and security standards, as well as aviation sector reform so that these islands can benefit from much improved connectivity between themselves and with key trading partners to promote trade, tourism and investment. Similarly, a regional ICT project in the Caribbean region has provided the participating countries (Grenada, St. Lucia, and St. Vincent and Grenadines) a unique opportunity not just to coordinate investments to build regional connectivity infrastructure, but also to engage in dialogue for policy harmonization and knowledge sharing to promote ICT innovation and harmonized skill development and certification for supporting private sector development and job creation. 24. Partnerships with IFC and MIGA have been critical in leveraging private financing to complement regional IDA infrastructure investments, and in providing advisory services on Public-Private Partnership (PPP) structuring and project preparation financing. IDA and IFC co-financed the East Africa Submarine Cable System (EASSy), a US$240 million submarine cable led by 26 telecommunications operators (mostly private) that connects the East coast of Africa to Asia and Europe. IFC provided US$19 million in financing for the cable system, and IDA provided technical assistance to make the case with operators and governments for operating the cable on an open access basis, and regional IDA project financing of US$165 million for the related terrestrial backbone links. For the Kenya-Uganda (Rift Valley) Railway, IFC provided upstream advisory work to the Government of Kenya as well as US$32 million in debt financing to the investor, and IDA provided Partial Risk Guarantees to the investor for termination risks of an amount of US$45 million to the Government of Kenya and US$10 million to the Government of Uganda. In parallel, IDA financing was provided to cover severance costs associated with the railway restructuring under the East Africa Trade and Transport Facilitation Project, as well as supporting the reclamation of the railway reserve in addition to restructuring costs. 25. Partnerships with other donors and the private sector are playing an increasingly important role in regional projects. Regional IDA investment projects have leveraged over US$3.1 billion in co-financing and parallel financing, particularly for large scale infrastructure - 12 - investments. Traditional multilateral partners such as regional development banks, the European Investment Bank (EIB) and the European Commission as well as bi-lateral partners such as France and Germany have provided the bulk of matching financing, but support from other donors such as Kuwait and Saudi Arabia has also been growing quickly. In addition, the regional IDA program has been complemented with over US$200 million in multi-donor trust fund investments in shared natural resource protection through the GEF and Nile Basin Trust Fund, as well as investments in agricultural productivity and cross-border learning and dissemination (such as the Comprehensive Africa Agricultural Development Platform (CAADP)). The UK‟s Department for International Development (DFID) is an active partner and has provided substantial resources, including supporting the East Africa Trade and Transport Facilitation Project (EATTFP), the Southern Africa Investment Climate Assessment (ICA), as well as the West Africa Analytical Trust Fund supporting regional integration. On the non- lending side, several bilateral partners (UK, US, Australia) are providing trust funds and strategic support to Bank and IFC efforts to reduce barriers to economic cooperation in South Asia (and between South and Central Asia) and also to prepare regional investment projects. B. The Performance of the IDA Regional Program Portfolio 26. Implementation performance of the regional IDA portfolio has improved markedly in recent years. The disbursement ratio, a proxy for implementation pace, has climbed from 6 percent at end FY08 to an all time high of 17 percent at end FY12. These improvements are all the more remarkable given the complexity of regional projects, the rapid rise in total commitments – from US$2.4 billion at end FY08 to US$6.5 billion by October 2, 2012 – and a consistently low average project age due to high number of new deliveries in the portfolio. 27. Increased emphasis has been placed on results at both the individual project and overall portfolio level. New projects include “core� indicators allowing for aggregation of impact measurement across individual phases of adaptable program loans and the portfolio as a whole. Additional indicators measuring the regionality/spillover benefits are also being emphasized to a greater degree to measure impact outside of the countries where projects are being Figure 3. Growth in Annual Disbursements and Disbursement implemented. In the Sub-Saharan Africa Region Ratio new sub-regional implementation action plans 850 Disb in FY (USD Million) 20% (IAPs) feature a comprehensive results Disb Ratio 650 15% framework setting benchmarks and targets under each of the RIAS strategic pillars unique to the 450 10% goals and interventions planned in each sub- 250 5% region. The South Asia Region has chosen specific Tier 2 and Tier 3 indicators, including 50 0% Core Sector Indicators to monitor results achieved FY08 FY09 FY10 FY11 FY12* by the regional integration portfolio. 28. Despite the significant improvements in performance, implementation challenges remain. Some of the challenges arise from the inherent complexity of projects involving several countries. Significant efforts must be directed at coordination between participating countries and implementing agencies, with the lowest capacity or most reluctant country in the project - 13 - often dictating the pace of implementation and blunting or watering down coordinated policy reforms. Such challenges are compounded by the sectoral and geographic concentration and the technical complexity of the regional integration portfolio. 29. The high concentration of regional projects in infrastructure has contributed to implementation delays. Large scale infrastructure projects – both single country and regional – have proven slower to implement, in part a reflection of the time needed to complete large and complex procurements and of back-loaded disbursement schedules that follow the rate of construction of physical works after contracts have been awarded. Coordination among the many donors often participating in infrastructure projects has often contributed to long required implementation time due to different policies and procedures (procurement, safeguards, debarment, reporting), cross-effectiveness conditions, lack of follow-through on financial commitments, slow pace of implementation under individual components financed by one or more donor partners and strain on the implementing agencies which must deal with multiple donors under a single project. 30. Concentration in FCCs has at times also led to implementation delays of the regional portfolio. Forty-eight percent of regional portfolio commitments are in FCCs. Procurement is a challenge for most Bank projects in countries with weak capacity, but especially so for technically and operationally complex regional projects. Implementing agencies must not only have the management capacity and systems in place to competently execute the procurement process, but also the technical expertise to define proper qualification criteria, technical specifications and terms of reference up front and to monitor implementation and provide quality control oversight after contracts have been awarded. The technical aspect is particularly critical for complex infrastructure operations in energy and ICT. Such capacity is difficult to find domestically in many countries and attracting adequate international expertise to supplement has proven difficult while developing local capacity takes time. Political and security disruptions in one or more participating country have also led to delays in some operations. 31. In light of the above challenges, guidelines for readiness at entry have been established by the Sub-Saharan Africa region for all operations, with several key principles given greater weight for regional projects. Project preparation advances (PPAs) to build the capacity of implementing agencies are now standard practice for regional projects. Such PPAs can also be accessed by regional institutions which are intended as recipients of regional IDA grants. Completion of an 18 month procurement plan and readiness of the first year bidding documents are also heavily emphasized. Task teams are advised to pay careful attention to the political economy context at both the regional and national level which is critical to mitigate risks and ensure commitment. 32. Simplicity of project design and ease and speed of implementation are given greater emphasis when selecting and designing regional interventions. Efforts are made to tailor the design and scope of projects to the implementation capacity of national and regional institutions, and to set conservative disbursement estimates and project implementation periods. Also, regional project design should be selective in the number of effectiveness conditions to the extent - 14 - possible, and parallel, as opposed to joint, co-financing arrangements should be standard practice to avoid knock-on effects of disruptions in project components financed by other parties. 33. To improve overall portfolio performance, in-depth project performance reviews of regional projects are regularly conducted for all regional projects rated unsatisfactory or marginally satisfactory. The aim of the reviews is to provide guidance to task teams and offer support services from policy advisory, procurement and financial management colleagues to address implementation bottlenecks. The outcomes and action items of the performance review are agreed with the task team, regional integration department, relevant country departments and sector management and are tracked for progress in subsequent monitoring reports. 34. Given that implementation of regional projects and regional policies generally takes place at the national level, ensuring ownership of participating countries, and within the Bank, of country departments, is essential to success of the regional IDA program. To strengthen ownership, most country strategies now reflect regional issues and programs. In the Africa region, Country Directors and Country Management Units have been given a greater role and responsibility for regional programs and policy dialogue. „Coordinating‟ country directors (CCDs) for regional integration are now in place for each of the four sub-regions, tasked with coordinating sub-regional pipeline development and dialogue with regional institutions within their sub-region. Country Directors are now responsible for implementation performance of country components of regional projects, and regional projects are fully integrated into country level reporting and review systems. C. Emerging Results of the IDA Regional Program Lowering the Cost of Infrastructure Services 35. Regional IDA funding of more than US$4.9 billion is helping address the "missing links" in its regional energy, transport and ICT infrastructure networks. High costs, delays and uncertainties associated with transporting goods across the region are being addressed through inter-modal transport investments in key ports and regional road and rail systems. These investments are supported by institutional, policy and regulatory changes to help ensure that the costs of transport services are lowered. Expansion of ICT backbone infrastructure and introduction of legal and regulatory reforms continue to improve internet access and boost competition in the telecoms sector. Chronic power deficits and high energy costs are being addressed through support to regional power pools. A number of regional ICT projects are being implemented in the Sub-Saharan Africa region, as well as in the Pacific and Caribbean regions. 36. Regional IDA investments are supporting the development of 1,810 MW of hydropower generation capacity and 3,686 km of cross-border transmission lines to enable cross-border energy trading among countries of the West, East and Southern Africa Power Pools. Regional IDA financing, with strong leverage of co-financing from multi-lateral and bi- lateral donors, is enabling the supply of electricity from clean, carbon free sources for export to economic and population centers in neighboring countries at lower unit cost than domestically produced thermal power. In the South Asia region, IDA has financed the Nepal-India cross- border transmission line, leveraging the Asian Development Bank‟s complementary investment - 15 - in the Bangladesh-India cross-border transmission line. These investments, together with the existing connectivity between Bhutan and India, will create the transmission backbone for electricity trade between the four countries. IDA is also collaborating with the IFC to develop Nepal‟s abundant (>40,000 MW) hydropower resources that will help address Nepal‟s and th e region‟s energy deficits. 37. Transit times are falling along key regional transport corridors as a result of regional IDA financed infrastructure and transit facilitation investments. Regional IDA financing is contributing to the construction and/or rehabilitation of 2,715 km of roads along critical commercial transport corridors in West and Central Africa. Average transit times for goods have been reduced by over 50 percent in West (Tema – Ouagadougou corridor) and East Africa (Mombasa – Kigali corridor), due to improvements in infrastructure and on-going work to help streamline customs policies and procedures. Implementation of individual performance contracts by Cameroonian customs officials has significantly improved customs efficiency, increasing same day clearance for containers by as much as 25 percent in the port of Douala – with benefits to the domestic economy and inland countries which are heavily reliant on imports and exports transiting through the port. 38. African countries are being supported with regional IDA financing to connect to international broadband networks, construct regional backbone infrastructure and reform and modernize telecoms laws to increase private sector competition – dramatically reducing the cost of internet and telecommunications connectivity and rapidly expanding access. The price of broadband connectivity has fallen by over 90 percent in Kenya and Rwanda, 80 percent in Tanzania and 70 percent in Malawi – in part due to IDA financed infrastructure investments and sector liberalization under the Regional Communications Infrastructure Program in East and Southern Africa. Similar results are expected under regional connectivity programs in West and Central Africa when the Africa Coast to Europe cable goes live in the fourth quarter of 2012. Countries such as Liberia and Sierra Leone will have access to international submarine broadband connectivity for the first time. In many of the projects, innovative PPP structures have been utilized to allow governments to recover most if not all of their initial investments in landing stations and infrastructure through divestiture to the private sector. Lowering Trade Costs 39. Regional IDA investments aimed at strengthening regional financial architecture have contributed significantly to the improved regional capital markets in West and Central Africa. In West Africa, the Development Bank of West Africa (BOAD) has upgraded its operational systems and improved strategic management and technical capacity to mobilize long term funds on both regional and international markets. Assistance to the West African Economic and Monetary Union (UEMOA) stock exchange (Bourse Régionale des Valeurs Mobilière) and the regional capital market regulator has significantly improved technical capacity. The regional stock exchange is now profitable for the third year in a row, market competition has improved as more brokers have become licensed and total market capitalization has increased, now reaching FCFA3.54 trillion (US$7 billion). In Central Africa, regional IDA support has facilitated the modernization of payment systems of the Bank of the Central African - 16 - States (BEAC) and expansion of financial services throughout the region. As a result, inter-bank and retail transactions have moved from primarily cash to electronic transfers, increasing security and reducing transaction clearance times from an average of 3-4 weeks to 2-3 days. 40. Investments in trade facilitation and innovative insurance schemes have supported increased trade and investment, reduced uncertainty and lowered transit times for goods across borders. Over US$1.2 billion in trade and investments have been supported through extension of export credit insurance, political risk insurance, investment insurance and other financial products to help reduce business risks and costs of doing business in Africa through the Africa Trade Insurance Agency. Trade and transit facilitation measures supported in the context of regional transport projects (noted above) have led to a reduction in transit times along key corridors and reduced delays on imports and exports at ports. 41. Analytical work and technical assistance have informed the trade agenda and regional IDA investments with a view to supporting reforms aimed at lowering transaction costs that limit the capacity of citizens to move, invest and trade in goods and services across borders. Work in the Southern Africa Development Community (SADC) region examined the policy constraints to intra-regional trade which must be overcome to support regional value-chain development and increase export potential. Boosting trade in services, promoting PPPs and examining development opportunities through a regional economic geography lens have also been key themes of IDA's economic integration AAA program in East Africa. In West Africa, analytical work and technical assistance have provided strategic assessments of the West Africa financial sector, examined ways to lower the transaction costs of cross-border money transfers and examined legal and institutional impediments to trade and transport facilitation. "Borderless," an innovative partnership with USAID, UEMOA, ECOWAS and private sector partners, is collecting and publishing data on bribes, delays and checkpoints impeding movement of goods and people along the Abidjan-Lagos corridor, helping create a constituency for reform. Lastly, in 2012 the Bank completed the report Africa Can Help Feed Africa: Removing Barriers to Regional Trade in Food Stapes, a major piece of work on the barriers to trade in food staples which is a priority for Africa in the coming years; and analytical work on the constraints faced by female traders in the Democratic Republic of Congo. Improving Incentives for the Supply of Regional Public Goods 42. The regional IDA program has increased its support for key regional public goods with the goal of promoting sustainable development of shared natural resources and mitigating shared risks and vulnerability. Programs have focused primarily on collaboration on cross- border communicable diseases, regional collaboration on knowledge generation and innovation in the agriculture sector, wildlife protection and management of shared water resources and fisheries. 43. A regional network of high-quality public health and surveillance laboratories has been established across the member states of the East African Community (EAC). All laboratories are participating in a regional accreditation scheme which aims to enhance accountability, quality and benchmark, and track performance. A regional framework for cross- border surveillance is under development and joint simulation exercises and disease outbreak - 17 - investigations are now routine between countries. An innovative mobile phone and web based disease surveillance system for sharing information among EAC member states is being deployed. The regional pool of qualified lab assessors, mentors, and managers is expanding and the countries are developing a joint research agenda. The East, Central, and Southern Africa Health Community (ECSA-HC) and the EAC are supporting South-South knowledge sharing among the participating countries. 44. By pooling resources in centers of excellence and sharing knowledge and new technologies across borders, IDA supported programs in West and East Africa are poised to significantly boost agricultural productivity. Seventeen new agricultural technologies with improved yields of between 20-40 percent over control technologies have been developed at regional centers of specialization in West Africa and disseminated across the region, and about 31 tons of new breeder seeds and planting materials have been produced by research institutions and private seed companies employing these technologies. Over 67,000 farmers have accessed the new technologies with over 100,000 hectares under cultivation. Coverage is expected to expand exponentially as the stock of breeder seeds and planting materials is increased each season. The program in East Africa is at a much earlier stage but is expected to bring similar results once the initial research and development phase is more advanced and new technologies are available for dissemination. 45. Regional IDA resources have supported the collaborative, multi-sectoral development of trans-boundary water resources, focusing on master planning and development of flood control, irrigation, hydropower and transport infrastructure, environmental protection, livelihoods development and reduction of waterborne illness. IDA support to the Niger Basin Authority has contributed to the ratification of a landmark Water Charter governing the cooperative development and management of basin resources by all nine 9 riparian countries. In the Senegal River Basin, approximately 4,400 hectares of previous arid land have been developed for irrigated agriculture and the production of fresh water fish has increased by 12 percent. Likewise, the incidence of malaria has nearly been eliminated in a growing area of the basin through control programs and distribution of 2.6 million insecticide treated bed nets. The Lake Victoria Environmental Management Program is supporting coordinated watershed management, improved fisheries management, water resource monitoring and information sharing and pollution reduction measures among the five participating countries. 46. Regional IDA support to collaborative marine fisheries management in West Africa is leading to a reduction in illegal fishing and ultimately increased yields and value added of fisheries in local economies. Liberia and Sierra Leone – two of the first participating countries to join the West Africa Regional Fisheries Program – are for the first time publicly disclosing all fishing licenses and fees following EITI principles, resulting in the seizure of a number of forged licenses, increased government revenues and reduced corruption. Both countries have established inter-agency fisheries monitoring centers and routine sea patrols and regularly coordinate in monitoring vessels moving up and down the West African coast. As a result, more than ten foreign industrial trawlers have been arrested for illegal fishing over the last year, including one case where the vessel spotted off the Liberian coast fled to Sierra Leone and was apprehended by local authorities and returned to Monrovia for prosecution. With the space created by the decline in illegal fishing, both countries are currently preparing new long-term - 18 - policy visions for a healthy fisheries sector, and are also both designing new landing sites and infrastructure to attract more responsible private investment in sectors where the rule of law is being upheld. 47. Overall, the IDA activities related to regional public goods has demonstrated a focus on gender reflecting the central role of women in managing natural resources, cross border trade and the vulnerabilities to women including from transboundary communicable diseases. Since women are active in fish processing and handling in West Africa, the West Africa Regional Fisheries Program includes support to empower women‟s voices in local fishing co -management associations that manage local fish stocks and rights, and provides targeted training. To provide alternative sources of income for fisher households and reduce the demand for overfishing, retraining programs are offered targeted specifically at women. Since female farmers in the Senegal Basin are often forced to cultivate marginal lands subject to flooding, with irrigated lands largely controlled by farmer cooperatives led by men, the Senegal River Basin Multi- Purpose Water Resources Development Program has increased women‟s voices and participation in local water management coordination committees and associated water management agencies. V. CONCLUSIONS AND ISSUES FOR DISCUSSION 48. The regional IDA program has made significant progress since its inception, and has successfully integrated the regional grant pilot. The portfolio has steadily increased and commitments to active projects are currently estimated at approximately US$6.5 billion. The regional grant window has been successfully integrated into the regional IDA program, helping regional institutions to perform a critical role in the regional integration program and in the implementation of core regional components, which often do not lend themselves to implementation by any national body. It is also noteworthy that the portfolio performance has improved, and that the disbursement levels are increasing. In addition, there is increased demand for financing for regional projects from all regions, and the remaining IDA16 resources are expected to be fully committed by the end of FY13. There is a long stand-by list of projects, estimated at over US$2 billion, ready to be delivered if resources become available (see Annex 3). 49. In view of strong demand and an improving regional project portfolio Management proposes to reallocate SDR315 million of unused resources from the IDA16 Crisis Response Window (CRW). Including the one-third funding that comes from countries‟ regular IDA allocations, this would allow for a total of about SDR470 million to be committed to regional projects in the last year of IDA16. Management has provided additional details on the proposed reallocations in the IDA16 Mid-Term Review “Enhancing IDA Capacity to Respond to Crises�. 50. In response to calls from the international community, Management is also considering how it can expand its role in facilitating the preparation and completion of regional transformational projects whose financing needs are significant. These are projects often within a single country (such as a large hydroelectric project) that would have a transformational impact in the country where the bulk of the works are located, as well as in neighboring countries. Or they are projects whose implementation expands over several - 19 - countries but for which IDA is providing assistance to just one or two countries. The preparation of such projects are often not financed and realized because a combination of country and financial risk factors makes them unattractive to private sector investors in their early phases. With the concurrence of IDA Deputies, Management will endeavor to develop a proposal for how IDA can play an expanded role in financing the preparation of highly transformational projects and getting them off the ground, and will submit a proposal for discussion in the course of the IDA17 replenishment negotiations. 51. In terms of the existing regional program, the focus will be on three priorities going forward: (1) sustain the momentum of improvements in the active portfolio on regional integration; (2) increase the selectivity and strategic orientation of the regional project pipeline by supporting highly transformative projects in terms of potential outcomes, and by leveraging diversified instruments including Program for Results (PforR), guarantees, IBRD enclave financing and PPPs; and (3) continue to build capacity of regional institutions to enable, enhance and accelerate, as the case may be, implementation of the regional integration agenda. This will help ensuring the continued support to this important agenda, and that results are achieved with the funding provided. Ongoing efforts will continue to ensure project readiness at entry, tailor project design and implementation plans to the implementation capacity of national and regional institutions, perform project portfolio reviews and strengthen the ownership of regional project stakeholders. 52. To increase the selectivity and strategic orientation of the regional project pipeline, and given that the demand for regional programs and analytical work exceeds the available financial and human resources of IDA, efforts will continue to focus IDA regional program support in areas where the Bank has a recognized comparative advantage, the potential impact is considered transformative and which take into account lessons learned from implementation of the regional program to date. Partnerships with other donors including the AfDB, the private sector and civil society will be prioritized to complement IDA interventions and to develop constituencies for reform. Collaboration with IFC and MIGA will continue to be strengthened, particularly on infrastructure development and improvement of the business climate. 53. Capacity building of regional institutions remains a key cross cutting theme to accelerate implementation of the regional integration agenda. Effective regional institutions are essential to champion and facilitate the regional integration agenda and to implement key regional programs, in particular certain regional components which may not lend themselves to implementation by any national body. IDA will continue to use regional IDA grants to support long term capacity building of regional institutions, as well as coordinate closely with our development partners to build capacity of institutions supporting regional project development and regional policy dialogue. In order to support regional institutions that may not be directly associated with ongoing regional IDA investments, but still have a critical role to play in policy reforms and drive the agenda on regional integration in the various sub-regions, Management proposes to revise criterion #6 on accessing regional grants as detailed in para. 19. 54. Staff would welcome the Deputies’ views regarding: - 20 -  IDA‟s progress in implementing the regional grants pilot and the regional grant program.  The reallocation of SDR315 million of unused CRW resources to the IDA regional program in order to meet demand during FY14.  The development of a proposal for how IDA can expand its role in financing the preparation of highly transformational projects in the course of the IDA17 Replenishment.  The proposed revision to the criterion #6 on accessing regional grants as detailed in para. 19. - 21 - Annex 1 – The IDA Regional Program Portfolio (as of October 2, 2012) IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions Energy Support for the Southern Africa Power Pool (SAPP) Coordination center, construction/rehabilitation of Southern Africa transmission lines linking the Inga hydropower site in Democratic Power Market P069258 the Democratic Republic of Congo to the border of 560.7 Republic of APL1 Zambia, allowing for power trading with the SAPP. Congo, Zambia Modern ICT backbone infrastructure to be installed along transmission lines. IDA Partial Risk Guarantee to the West African Gas Pipeline Company Limited for the West African Gas Pipeline Project that aims to: (a) improve the competitiveness of the energy sectors of Ghana, Benin, West African Gas and Togo by promoting the use of cheaper and Ghana, Benin, P082502 50 Pipeline environmentally cleaner gas from Nigeria in lieu of Togo, Nigeria liquid fuels for power generation and other industrial and commercial uses; and (b) foster regional economic and political integration that would support economic growth. Rehabilitation of the hydroelectric facilities at Inga 1 and 2 in the Democratic Republic of Congo, increasing Southern Africa Democratic capacity from 700MW to 1,300MW, allowing for Power Market APL P097201 579.7 Republic of export to the Southern Africa Power Pool as well as 1B Congo domestic consumption through construction of a 400kV transmission line to Kinshasa. First Phase of construction/rehabilitation of a 330kV West Africa Power transmission backbone and supporting infrastructure P075994 40 Ghana Pool APL 1 Phase 1 connecting the coastal states of the West Africa Power Pool. Second Phase of construction/rehabilitation of a 330kV West Africa Power P094917 transmission backbone connecting West Africa Power 60 Ghana, Benin Pool APL 1 Phase 2 Pool coastal states from Côte d'Ivoire to Nigeria. Rehabilitation of a 60MW run-of-the-water Felou Mali, West Africa Power hydroelectric dam supplying power to Senegal, Mali P094916 160 Mauritania, Pool APL 2 Phase 1 and Mauritania and linked with the wider West Africa Senegal Power Pool network. The First Phase of Development of a transmission line between Ghana and the Inter-Zonal Burkina Faso, reinforcement of the transmission grid in Burkina Faso, Transmission Hub P094919 41.9 Ghana, rural electrification in Burkina Faso, and Ghana Project of the institutional support to GridCO and SONABEL. WAPP (APL3) - 22 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions Development of electricity transmission capabilities to West Africa West Africa Power foster power trading between Côte d'Ivoire, Senegal, Power Pool Pool (WAPP) P113266 176.2 Liberia and Guinea, and increasing the technical (WAPP), APL4 Phase 1 integration of the WAPP network. Liberia Zambia Upgrading the power transfer capacity of the Kafue Transmission P124351 Town-Muzuma-Victoria Falls transmission system to 60 Zambia Interconnection create a North-South power transmission corridor. Eastern Electricity Development of electricity transmission capabilities Kenya, P126579 676 Highway Project between Kenya and Ethiopia. Ethiopia (a) establish cross-border transmission capacity Nepal-India between India and Nepal of about 1,000 MW to Electricity Nepal and P115767 facilitate electricity trade between the two countries; 99 Transmission and India and (b) increase the supply of electricity in Nepal by Trade Project the sustainable import of at least 100 MW. Establish and operationalize a regional approach to the Eastern Caribbean development of the electricity sector in participating St. Lucia and Energy Regulatory P101414 5.6 countries by supporting the establishment of the Grenada Authority ECERA. Trade and Transport Facilitation P128938 Improve operational safety and oversight of 22.9 Kiribati Pacific Aviation international air transport infrastructure through Investment P128939 coordinated airport investments, adoption of common 27.2 Tonga Program safety and security standards, and aviation sector P128940 reform among the Pacific islands. 11.9 Tuvalu Reducing transit time in regional corridors through establishment of joint border posts, improvements in Kenya, East Africa Trade port security, implementation of the Customs Union Uganda, and Transport P079734 229 Protocol, concessioning of Uganda and Kenya railways Tanzania, Facilitation and port and intermodal infrastructure Rwanda construction/rehabilitation Improvement of road, rail and port infrastructure and implementation of transit and transport facilitation Cameroon, CEMAC Transport measures, including the Central Africa Economic and Chad, Central and Transit P079736 655 Monetary Community (CEMAC) Customs Protocol African Facilitation along the Doula-N'Djamena and Douala-Bangui Republic corridors. West Africa Improving road and rail infrastructure and Burkina Faso, Transport and P079749 implementing transit and transport facilitation measures 190 Ghana, Mali Transit Facilitation along the Tema-Ouagadougou-Bamako corridor. West and Central Burkina Faso, Africa Air Strengthening of Civil Aviation Authorities' safety and Mali, Transport Safety P083751 security oversight capacities and improvements in 33.6 Cameroon, and Security airport security, safety standards and infrastructure. Guinea Program APL 1 - 23 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions East Africa Trade IDA Partial Risk Guarantee to the Kenyan and and Transport P098770 Ugandan subsidiaries of Rift Valley Holdings Ltd. in 60 Kenya, Uganda Facilitation Project support to the Kenya and Uganda railways concessions. West and Central Africa Air Strengthening of Civil Aviation Authorities' safety and Transport Safety P100785 security oversight capacities and improvements in 46.7 Nigeria and Security airport security and safety standards and infrastructure. Program Phase 2 APL 2 West & Central Africa Air Strengthening of Civil Aviation Authorities' safety and Transport Safety & P108583 security oversight capacities and improvements in 16 Benin, Senegal Security Program airport security and safety standards and infrastructure. Phase 2B APL 2B Trade facilitation (customs modernization and Abidjan-Lagos harmonization, establishment of joint border posts), Transport and Ghana, Benin, P096407 rehabilitation/construction of critical road infrastructure 228 Transit Facilitation Togo segments, and HIV/AIDS treatment and prevention APL1 along the Abidjan-Lagos corridor. Abidjan-Lagos Trade and Development of roads and reduction of trade barriers Transport P116323 90 Côte d'Ivoire along the Abidjan-Lagos trade and transit corridor. Facilitation Program - APL-2 Information and Communication Technology (ICT) Reduce the cost and increase the availability of Pacific Regional international bandwidth for participating countries, and Connectivity P113184 thereby facilitate the development of a wide range of 17.2 Tonga Program ICT applications to support social and economic development in the Pacific region. OECS E- Promote the efficiency, quality, and transparency of Caribbean government for P100635 public services through the delivery of regionally region, St. 6 Regional integrated e-government applications that take Vincent and Integration advantage of economies of scale. Grenadines P117087 Construction of a landing station for international Regional undersea fiber optic cables and regional backhaul Kenya, Communications infrastructure and financing the purchase of capacity on P094103 274.7 Madagascar, Infrastructure the submarine cables for targeted users (e.g., rural and Burundi Program APL 1 underserved areas, governments, universities, and hospitals). - 24 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions Establishment of a 'virtual landing station' for Regional international fiber optic cables, construction of regional Communications backhaul infrastructure and financing of capacity P106369 24 Rwanda Infrastructure purchase schemes on the cables for targeted users (e.g., Program APL 2 rural and underserved areas, governments, universities, and hospitals). Construction of a landing station for international Regional undersea fiber optic cables and regional backhaul Malawi, Communications P111432 infrastructure and financing the purchase of capacity on 151 Mozambique, Infrastructure the submarine cables for targeted users (e.g., rural Tanzania Program APL 3 areas, governments, universities and hospitals). Financing of various activities in the form of technical assistance, training, and equipments to establish the Cameroon, Central Africa P108368 Central Africa backbone network with the aim to 26.2 Central African Backbone APL 1A increase the geographical reach and usage of regional Republic, Chad broadband network services at reduced prices. Development of regional broadband network services Central African Central African P116542 in the Republic of Chad and the Central African 50 Backbone - APL1B Republic, Chad Republic. Addition of STP to CAB program (capacity purchase Central Africa on submarine fiber optic cable) and policy work to Sao Tome and P117652 14.9 Backbone APL 2 increase competition (addition of second private Principe operator) Central African Development of regional broadband network services P122398 15 Congo Backbone - APL3 in the Republic of Congo. Central African Development of a telecommunications backbone P122776 56 Gabon Backbone - APL4 linking Gabon to existing broadband networks. West Africa Addressing missing infrastructure links, providing Regional competitive access to submarine cables, and Liberia, Sierra Communications P116273 strengthening institutions to increase the geographical 56.6 Leone Infrastructure reach of broadband networks and reduce the costs of Program APL 1 communications services in West Africa. West Africa Regional Financing of activities supporting connectivity and Gambia, Communications P122402 developing an enabling environment to increase the 92 Burkina Faso, Infrastructure geographical reach of broadband networks. Guinea Project - APL-1B WARCIP APL1C - P130184 Addition of Benin to the WARCIP broadband network. 35 Benin Benin Water Resources Development - 25 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions Establish key examples of integrated water resources Mekong Integrated management practices in the lower Mekong Basin at Water Resources P104806 the regional, national and sub-national levels, thus 26 Lao, MRC Management contributing to more sustainable river basin management in the lower Mekong. Central Asia Improve the accuracy and timeliness of hydromet Central Asia, Hydromet P120788 services in Central Asia, with particular focus on 20.7 Kyrgyz and Modernization Kyrgyz Republic and Republic of Tajikistan. Tajikistan Project Niger Basin Water Capacity building of the Niger Basin Authority (NBA), Resources rehabilitation of the 760MW Kainji and 578MW Jebba Benin, Mali, Development & hydroelectric plants, sustainable management of P093806 186 Nigeria, Niger, Sustainable degraded environments and rehabilitation of small- Guinea Ecosystems scale water infrastructure (small hydroelectric dams Management APL 1 and irrigation schemes). The program objective is to enhance regional cooperation, development, and sustainability of water Niger Basin Water resources management in the Niger River Basin. The Resources APL2a – P130174 development objective of this project (WRD-SEM APL 203 Niger, NBA Kandaji Hydro 2A) is to increase access to water for agriculture development and capacity for energy generation in the Recipient‟s part of Niger Basin. Strengthening regional integration among the riparian Senegal River countries of the Senegal River Basin through the SRB Basin Multi- Senegal, Mali, Organization (OMVS) for multi-purpose water Purpose Water P093826 110 Mauritania, resources development including improved community Resources Guinea livelihoods. Pre-investment support OMVS Gouina Development APL1 Hydroelectric Project and OMVS multi-purpose dams. Agriculture and Fisheries Establishment of regional centers of excellence in West Africa agricultural research, establishment of common Agricultural Senegal, Mali, P094084 regional regulations for genetic materials and pesticides 45 Productivity Ghana and facilitating dissemination of new agricultural Program APL 1 technologies. Addition of new countries to the WAAPP Program. West Africa Establishment of regional centers of excellence in Burkina Faso, Agricultural agricultural research, establishment of common P117148 90 Côte d'Ivoire, Productivity regional regulations for genetic materials and pesticides Nigeria Program APL1B and facilitating dissemination of new agricultural technologies. West Africa Extension of the WAAPP to new member countries to Benin, Niger, Agricultural establish regional centers of excellence in agricultural Gambia, Sierra P122065 83.8 Productivity research centered around new crop varieties and Leone, Togo, Program APL1C regional dissemination of new technologies. Liberia - 26 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions West Africa A scale-up of the generation, dissemination and Ghana, Mali, Agricultural P129565 adoption of approved technologies in the participating 180 Senegal Productivity APL2a countries. Cape Verde, West Africa Program aimed at sustainable management of regional Liberia, Regional Fisheries P106063 fisheries and increasing local revenues from the 47 Senegal, Sierra APL 1 fisheries trade. Leone West Africa Addition of Guinea-Bissau to the West Africa Regional Regional Fisheries P119380 6 Guinea Bissau Fisheries Program. APL-1B Eastern Africa Ethiopia, Strengthening regional centers of excellence in Agricultural Kenya, P112688 agricultural research and increasing availability of new 120 Productivity Tanzania, technologies to farmers. Program APL1 Uganda To assist the West African Economic and Monetary West Africa P105140 Union establish a regional biosafety framework for the 3.9 Burkina Faso Biosafety Project regulation of Living Modified Organisms (LMOs). Finance EAC Financial Sector Capacity building of the EAC to support the regional P121611 16 EAC Regionalization harmonization of the East African Financial System. Program Phase I Support for the establishment of the Africa Trade Insurance Agency (ATI) and financing for member Regional Trade states to join ATI. ATI facilitates private sector-led Facilitation P112456 27.5 Benin, Ghana trade flows and investments through the provision of Program Phase II insurance, coinsurance and reinsurance, financial instruments and related services Benin, Burkina WAEMU Capital Faso, Cote Market Partial Risk Guarantee available to the participating d'Ivoire, Development P089120 countries to support regional capital market 70 Guinea-Bissau, Project-Partial Risk development Mali, Niger, Guarantee Senegal, and Togo Strengthening of six regional financial and regulatory Central Africa institutions to expand and improve transparency and (CEMAC) Regional P099833 competitiveness of regional financial markets, with the 50 BEAC Institutions Support aim of channeling oil revenues toward investment in Project Central Africa. Environment APL on Assist the participating governments to build or Strengthening enhance shared capacity, institutions, knowledge and Regional Nepal and P121210 incentives to collaborate in tackling illegal wildlife 39 Cooperation For Bangladesh trade and other select regional conservation threats to Wildlife Protection habitats in border areas. in Asia - 27 - IDA Participating Project Project Name Description Commitment Countries/ ID (US$ m) Institutions Second Phase of the APL on To assist the participating governments of Bhutan and Strengthening others to build or enhance shared capacity, institutions, Regional P126193 knowledge and incentives to collaborate in tackling 2.3 Bhutan Cooperation for illegal wildlife trade and other selected regional Wildlife Protection conservation threats to habitats in border areas. in Asia Regional Disaster Measurably reducing vulnerability to natural hazards Grenada, St. Vulnerability P117871 and climate change impacts in the Eastern Caribbean 21 Vincent and Reduction APL1 Sub-region. Grenadines Lake Victoria Capacity building and institutional strengthening of the Kenya, Environmental Lake Victoria Basin (LVB) Commission, to strengthen P100406 90 Tanzania, Management Phase source pollution control and prevention as well as Uganda II APL 1 (IDA) watershed management. Lake Victoria Strengthening institutional capacity for managing Environmental shared fisheries and water resources, point source Burundi, P118316 30 Management pollution control and prevention, and watershed Rwanda Project management of the LVB region (Burundi-Rwanda). Health Kenya, East Africa Public Rwanda, Strengthening and networking of regional reference Health Laboratory P111556 78.7 Tanzania, laboratories for communicable disease surveillance Networking Project Uganda, Burundi Governance and Capacity Building Capacity building support for ACBF and financing of ACBF Capacity P122478 technical assistance sub-grants to improve institutional 25 ACBF Building Project capacity for public policy formation. Strengthening OHADA's regional institutions to foster OHADA Support P126663 the improvement of aspects of the investment climate 15 OHADA Project within OHADA. - 28 - Annex 2 – IDA Regional Program Pipeline for FY13 IDA Participating Project Commit Project Name Description Countries/ ID ment Institutions (US$ m) Energy Southern Africa Power Capacity building support for SAPP secretariat Pool (SAPP) and and RERA to facilitate establishment and Regional Electricity adoption of harmonized electricity regulations P126848 20 TBD Regulators Association of across national operators and the Southern Africa (RERA) synchronization of grids to allow for seamless Support Project power trading across the pool Rusumo Falls Development of a run-of-river hydroelectric Burundi, Rwanda, Hydroelectric and P075941 power plant at Rusumo Falls to address power 360 Tanzania Multipurpose Project shortfalls in Burundi, Rwanda and Tanzania. Trade and Transport Facilitation Rehabilitation of several key road sections, Southern Africa Trade establishment of a One Stop border post on the Tanzania, DAR and Transport Facilitation P120370 Tanzania/Malawi border, and introduction of 215 Corridor (North-South Corridor) interventions in the area of road safety and Committee HIV/AIDS mitigation. Information and Communication Technology (ICT) Development of a broadband network between Togo, Mauritania, WARCIP APL2 P123093 Togo, Mauritania and Mali to reduce the costs 84 Mali of communications services. Regional Inclusion of the Comoros in the regional Communications broadband network and development of e- P118213 22 Comoros Infrastructure Program – government applications to improve APL4 government efficiency and transparency. Water Resources Development The 2nd phase to the on-going PGIRE APL1. The three main components are 1) regional Senegal River Basin institutional development; 2) local-level multi- Mali, Mauritania, Water Resources TBD purpose water resources development 110 Guinea, Senegal Development APL2 including irrigation, fisheries, watershed management, etc.; and 3) infrastructure investment planning. Support the participation of Cambodia and Vietnam to further enhance integrated water Mekong Integrated Water resources management practices at the Cambodia, Resource Management P124942 38 regional, national and sub-national levels and Vietnam APL2 contribute to more sustainable river basin management in the lower Mekong. Agriculture and Fisheries Establishment of regional centers of excellence Regional Agricultural in agricultural research, establishment of Malawi, Productivity Program for common regional regulations for genetic P094183 90 Mozambique, Southern Africa materials and pesticides and facilitating Zambia (RAPPSA) dissemination of new agricultural technologies. - 29 - IDA Participating Project Commit Project Name Description Countries/ ID ment Institutions (US$ m) Environment Assist the participating governments (India) to build or enhance shared capacity, institutions, APL on Strengthening knowledge and incentives to collaborate in Regional Cooperation for tackling illegal wildlife trade and other select 30 India Wildlife Protection in P128275 regional conservation threats to habitats in Asia border areas. Finance Support Bosnia and Herzegovina to an APL that establishes the Southeast Europe and Caucasus Catastrophe Risk Insurance Facility Southeast Europe and to help increase access of homeowners, Caucasus Catastrophe farmers, the private sector and government Bosnia and P127549 5 Risk Insurance Facility agencies to catastrophe and weather risk Herzegovina APL3 insurance products that provide financial protection from losses caused by climate change and geological hazards through a regional approach to risk insurance. Governance and Capacity Building Capacity building support for ACBF and financing of technical assistance sub-grants to ACBF Support Program P127549 65 ACBF improve institutional capacity for public policy formation. - 30 - Annex 3 – Currently Unfunded Regional Projects Potential IDA Participating Project Name Commitment Countries (US$ m) Senegal Senegal River Basin Water Resources Mauritania 110.0 Development APL 2 Mali Guinea Southern Africa Power Pool - Mozambique Transmission Line 200.0 Mozambique Development West Africa Fisheries APLC 49.0 Mauritania Central Africa Backbone (CAB) APL5 80.0 DRC West Africa Regional Communications Guinea-Bissau 62.0 Infrastructure (WARCIP) APL3 Niger Regional Higher Education Support Program (Science, Technology, 110.0 TBD Innovation, etc.) Ethiopia Regional Pastoral Livelihoods Recovery 180.0 Kenya and Resilience Uganda Southern Africa Trade and Transport 60.0 Malawi Facilitation APL2 Comoros South West Indian Ocean Fisheries 48.5 Mozambique Program Seychelles West Africa Power Pool - Adjarala Benin 120.0 Hydropower Togo East Africa Power Pool (EAPP) APL2 Kenya 135.0 (Kenya-Tanzania Interconnection) Tanzania Cape Verde West Africa Agricultural Productivity Guinea-Bissau 42.0 APL1 Guinea Mauritania Central Asia-South Asia Electricity 1,000.0 TBD Generation and Transmission Total 2,196.5