The World Bank Education Improvement Project (P130182) REPORT NO.: RES47792 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF EDUCATION IMPROVEMENT PROJECT APPROVED ON MARCH 13, 2014 TO REPUBLIC OF ARMENIA EDUCATION EUROPE AND CENTRAL ASIA Regional Vice President: Anna M. Bjerde Country Director: Sebastian-A Molineus Regional Director: Fadia M. Saadah Practice Manager/Manager: Harry Anthony Patrinos Task Team Leader(s): Katia Marina Herrera Sosa, Soren Nellemann The World Bank Education Improvement Project (P130182) I. BASIC DATA Product Information Project ID Financing Instrument P130182 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 13-Mar-2014 30-Sep-2021 Organizations Borrower Responsible Agency Republic of Armenia Center for Education Projects Project Development Objective (PDO) Original PDO The Project Development Objectives (PDO) are to improve school readiness of children entering primary education, improve physical conditions and the availability of educational resources in upper secondary schools, and support improved quality and relevance in higher education institutions in Armenia. Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-83420 13-Mar-2014 23-May-2014 20-Nov-2014 30-Sep-2021 15.00 14.20 .80 IDA-53870 13-Mar-2014 23-May-2014 20-Nov-2014 30-Sep-2021 15.00 13.66 .02 The World Bank Education Improvement Project (P130182) Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No II. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The Project Development Objectives (PDOs) of the The Armenia Education Improvement Project (EIP) (P130182) are “to improve school readiness of children entering primary education, improve physical conditions and the availability of educational resources in upper secondary schools, and support improved quality and relevance in higher education institutions in Armenia”. The outcomes of the project so far include but are not limited to 136 new preschools in rural communities benefitting about 11,700 children, five retrofitted high schools, and 18 grants to higher education institutions to improve quality and labor market relevance of their education programs. Project progress has been rated satisfactory and moderately satisfactory over the implementation period given that it has consistently made good progress towards achieving its PDOs, and aside from some disruptions caused by the COVID-19 pandemic and the 2020 conflict, has maintained good implementation progress and disbursements. The last Implementation Status & Results Report (ISR) has Moderately Satisfactory (MS) rating for the PDO and Moderately Satisfactory (MS) IP rating. The cumulative disbursement is 93.65%. The PDO remains partially achievable, as two PDO indicators will not be achieved by the current closing date, hence, an extension is required to fully achieve all PDO and intermediate indicators. Without the extension, 2 out of the 13 intermediate indicators (the number of classrooms in rehabilitated high schools and the number of partnerships between public and private institutions established under the CIF/number of higher education institutions benefiting from the CIF’s component) may not be achieved. The performance of the Recipient remains satisfactory; the Project is compliant with financial reporting and auditing requirements and is not subject to suspension of disbursements, the Recipient has no outstanding audit reports; and the audit reports of previous years were delivered on time and considered acceptable. If the extension is granted, the Project will have a 100% disbursement by April 30, 2022. Summary of Previous Restructurings. The Project has been extended once. The original closing date was September 30, 2019. It was extended by 24 months in 2018 from September 30, 2019 to September 30, 2021 to allow adjusting the implementation time frame to the government new fiscal policy and amount of counterpart financing affected by tight macro-economic and fiscal situation in Armenia. Rationale for proposed closing date extension. As a result of the global COVID-19 pandemic and in the aftermath of the 2020 conflict, two important project activities experienced delays—the high school rehabilitation and the university grants. While the projects under the Competitive Innovation Fund (CIF) financed from the Project and implemented by local universities progressed satisfactorily, there were delays imposed by the global travel restrictions on implementing procurement processes, including shipping of procured laboratory equipment, causing installation and training delays. On the high school rehabilitation side, while the civil works contracts financed by the Project and implemented by the local contractors progressed satisfactorily, there were delays in the civil works of Vagharshapat High School no. 5 in March–May 2020 (caused by the COVID-19 quarantine in the town of Vagharshapat where the highest number of COVID-19 cases in the country were reported in spring 2020) and in Goris High School no. 1 in September – November 2020 (caused by military actions on the border due to the conflict). Hence, activities were temporarily put on hold. These specific delays are triggering the need to extend the Project closing date by seven months to ensure all project activities are completed in a satisfactory manner, all PDOs indicators can be fully achieved, and project funds are fully disbursed. The World Bank Education Improvement Project (P130182) Next Steps: Following the assessment of the Project activities included in the Procurement Plan, the Recipient prepared an Action Plan for the remaining activities, which is satisfactory to the World Bank team. The Government is committed to successfully complete the remaining activities including the tenders for the remaining service contracts and ensure the completion of the civil works contracts by the extended closing date. The Implementing Agency is also committed to ensure that the Action Plan is added promptly to the Project Operation Manual as soon as the proposed extension is approved. III. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IBRD-83420 Effective 30-Sep-2019 30-Sep-2021 30-Apr-2022 30-Aug-2022 IDA-53870 Effective 30-Sep-2019 30-Sep-2021 30-Apr-2022 30-Aug-2022