For Official Use Only CLR Review Independent Evaluation Group 1. CPS Data Country: Nicaragua CPS Year: FY13 CPS Period: FY13 – FY17 CLR Period: FY13 – FY17 Date of this review: March 5, 2018 2. Ratings CLR Rating IEG Rating Development Outcome: Moderately Satisfactory Moderately Satisfactory WBG Performance: Good Good 3. Executive Summary i. Nicaragua is a lower middle-income country with a GNI per capita of $2,050 in 2016. Nicaragua’s annual economic growth increased from 3.3 percent during the prior CPS period (2008-2012) to 4.9 percent during the CPS period under review (2013-17). Growth was sustained by an adequate macro and fiscal environment and responded to higher growth of the US economy, from 0.9 percent to 2.2 percent between the two CPS periods. Growth helped reduce poverty rates, from 42.5 percent in 2009 to 29.6 percent in 2014 and 24.9 percent in 2016. Better social conditions are reflected in Nicaragua’s Human Development Index, which improved from 0.636 in 2013 (ranked 132nd among 187 countries) to 0.645 in 2015 (ranked 124th among 188 countries). However, inequality (the GINI Index) increased, from 44.2 in 2009 to 46.6 in 2014. The poverty rate in rural areas (50.1 percent in 2014) remains higher than in urban areas (14.8 percent in 2014), and 45 percent of Nicaraguans are at risk of falling into poverty if hit by a shock. ii. The World Bank Group’s (WBG) had two pillars: (i) improve access to quality basic services and (ii) improve competitiveness and productivity. The CPS was broadly aligned with the Government of Nicaragua’s (GON) National Human Development Plan 2012-2016 (NHDP). The NHDP sought economic growth with employment generation and poverty and inequality reduction. Government strategies focused on increasing poverty-related spending and boosting investments in the social sectors and in rural infrastructure. WBG’s support was also aligned with a number of GON’s programs, including the new Education Sector Plan, the Family and Community-Based Social Welfare Model, and Rural Road Improvement programs. iii. During the CPS period, new IDA commitments, including Additional Financing and regional projects (or 14 operations) amounted to $439.9 million. The new lending commitments were above the total planned amounts ($249.0 million). New IDA lending commitment allocations were higher (exceeding 10 percent of total allocation) for roads, education, health, and land administration. New trust fund (TF) commitments ($97.04 million) were also higher than the inherited portfolio ($24.32 million) covering several areas including education (see Annex 4). The education sector received more than half of the TF commitments. The sector shares of new IDA commitments were significantly higher than those of pre-existing operations for education and health, and significantly lower for social protection, water, roads, and private sector development, perhaps reflecting GON’s human development priorities. All lending operations are in the form of Investment Project Financing (IPFs). CLR Reviewed by: Panel Reviewed by: CLR Review Manager/Coordinator Mauricio Carrizosa Jorge Garcia-Garcia Pablo Fajnzylber Consultant, IEGEC Consultant, IEGEC Manager, IEGEC Takatoshi Kamezawa, Lourdes Pagaran Sr. Evaluation Officer, IEGEC CLRR Coordinator, IEGEC For Official Use Only CLR Review 2 Independent Evaluation Group iv. During the CPS period, IFC made a total net commitment of US$513.7 million. IFC’s short term trade finance guarantee accounted for 83.1percent of this total net commitment, with core product of long-term loans and equity investments of only US$89.1 million. Through its investment operation, IFC financed financial institutions, including a hospital, an agribusiness, and a power plant. During the CPS period, IFC approved four new AS projects amounting to $2.2 million in the financial and agricultural sectors, and for investment climate reforms. During the same period, MIGA underwrote US$89.0 million guarantees to support foreign direct investments in agribusiness, manufacturing, and the banking sector. v. On balance, IEG rates development outcomes as Moderately Satisfactory. The CPS achieved significant results on Focus Area I (Improve Access to Quality Basic Services). These include increased delivery of education and health services, albeit with shortfalls in the quality of those services; and a higher number of people in rural areas with access to water and sanitation. While there was progress on public financial management in meeting the CPS outcome target, the extent or scope of that progress is unclear. Focus Area II (Improve Competitiveness and Productivity) achieved results in improving rural access to roads and telecommunications as well as in increasing agricultural productivity. IFC investment and AS projects contributed to increase the supply of renewable energy, the availability of specialty health care, and the access to training and funding by coffee farmers. However, IDA’s impact on the investment climate was unclear from somewhat contradictory indicators. IEG could not verify the extent to which WBG support increased access to finance by Medium, Small, and Micro Enterprises (MSMEs). vi. IEG rates WBG performance as Good. On design, the CPS addressed well-identified development challenges and benefited from congruence with GON programs and consultation with multiple stakeholders. Selected CPS areas were consistent with WBG poverty reduction and shared prosperity objectives (e.g., by focusing on basic services). The CPS was selective, aligning support with focus areas, and with proposed interventions based on the WBG’s extensive country knowledge, their congruence with NHDP goals, and their possible impact. Planned selectivity also considered a sectoral division of labor with the Inter-American Development Bank (IDB). Planned interventions could reasonably be expected to achieve objectives in most areas. The results framework could have been clearer by explicitly articulating the CPS objectives in the results matrix and providing a clear definition of some outcomes. The use of lending and non-lending instruments were appropriate overall. On balance, the CPS and PLR adequately identified risks mitigation measures to address those risks. However, when the capacity risk materialized on early childhood education, the planned mitigation measures did not suffice to neutralize this risk. vii. Implementation benefited from the absence of major adverse shocks during the CPS period. The WBG and GON worked well in coordinating implementation through well-structured communications that strengthened portfolio management. During implementation, the PLR made some revisions to the results framework, primarily downgrading expected outcomes where implementation was slower than anticipated and defining better some of the program’s outcome indicators. Bank-IFC activities were largely separate and independent from each other, with no evidence of the stronger collaboration that the CPS anticipated. The CLR reports that there were no major safeguard issues and that fiduciary issues were effectively handled. INT noted two complaints that were substantiated. viii. IEG agrees with the CLR lessons, summarized as follows: (i) IDA’s convening power (e.g., through trust funds) can increase financing and catalyze development through leveraging its resources with those of other donors; (ii) Government commitment combined with effective communication channels, such as those established between GON and IDA, can improve portfolio management and implementation; (iii) increased women participation (e.g., in roles under community rural road building programs) can help reduce poverty and contribute to shared prosperity; (iv) existing institutional capacity levels and commensurate implementation arrangements are key determinants of the development objectives that can be achieved; (v) access to quality data will improve decision-making. ix. IEG provides the following additional lessons: For Official Use Only CLR Review 3 Independent Evaluation Group • First, Nicaragua’s quest for improved social services would benefit from a stronger focus on quality. In the case of Nicaragua, available indicators suggest that primary education quality has not improved. A focus on education requires monitoring of quality levels. Complementing completion rates with periodic test scores will help understand what works for improving learning outcomes. • Second, WBG’s development effectiveness and impact could be further enhanced through joint Bank/IFC implementation. In the case of Nicaragua, it was envisaged in the CPS to have joint IDA/IFC work in education, health services and financial innovation. However, joint implementation did not materialize and the Bank/IFC pursued parallel and separate activities. 4. Strategic Focus Relevance of the WBG Strategy: 1. Congruence with Country Context and Country Program. The CPS pillars and objectives were broadly congruent with the GON’s objectives on economic growth with employment generation and poverty and inequality reduction, as articulated in GON’s NHDP. Furthermore, CPS objectives were aligned with specific Government programs. For example, on reducing poverty and inequality, the CPS objective to improve educational attainment was consistent with GON’s Education Sector Plan, which sought to improve the coverage and quality of preschool education, completion of primary education; and the coverage and quality of secondary education. Similarly, on competitiveness and productivity, the CPS objective to expand rural infrastructure was aligned with GON’s National Rural Road Infrastructure Improvement Program, and with GON’s focus on rural telecommunications and renewable energy investments. Success in achieving these objectives faced several challenges. The buildup of human capital had been constrained by inefficiencies in the education system, with high dropout and repetition rates, and by slow progress on nutrition and maternal health outcomes. There were inefficiencies and gaps in access to water and sanitation, particularly in rural areas. Economic growth had also been undermined by weaknesses in the investment climate, inadequate access to credit, infrastructure gaps, and low agricultural productivity. 2. Relevance of Design. The proposed WBG interventions could reasonably be expected to have an impact toward CPS objectives in most areas. For example, planned education projects could improve educational attainment by increasing or improving standard education inputs (e.g., better teacher training). Similarly, land administration projects could be expected to increase access to finance and improve the investment climate through stronger property rights. On the investment climate, however, planned interventions (MSME support) were unlikely to have a strong impact. Planned ASAs covered critical knowledge inputs (e.g. on poverty and on water and sanitation) that could enhance impact through better country dialogue and project design. On health, capitation payment could encourage better delivery of services at the local level and investments in water infrastructure could improve health through better access to improved water. The CPS was appropriately flexible on financing instruments, by planning originally to provide IPF exclusively, albeit envisaging possible Development Policy Operations if GON requested them on the basis of robust policy agendas. Planned joint IDA/IFC activities (on agriculture and financial innovation) could improve WBG’s impact; however, this proposed internal synergy did not materialize as both entities pursued separate and parallel activities. Planned ASA covered some of the areas targeted by CPS objectives (Agriculture, Education, PFM, and water/sanitation). Planned coordination with the IMF could help maintain macro stability and mitigate external shocks. Selectivity 3. The CPS was selective in its two focus areas and eight objectives, given the country context. Proposed interventions were based on the WBG’s extensive country knowledge, their congruence with NHDP goals, and their possible impact. The CPS covered some of the critical areas (e.g., education, land administration, water and sanitation) that could support poverty reduction or shared prosperity through its focus on basic services and competitiveness, and where IDA had experience and knowledge, as well as a good implementation record. Given its resource constraints or GON priorities, IDA excluded some other critical areas (e.g., vocational education and training for better For Official Use Only CLR Review 4 Independent Evaluation Group jobs, as the Systematic Country Diagnostic suggests) from its planned objectives or core interventions. Other areas (e.g., governance) may have been excluded due to weak progress during the FY0812 CPS. Program selection also considered a planned division of labor with the IDB on some areas (larger roads, rural water and sanitation (IDA) and rural roads electrification and procurement (IDB)), as well as co-financing of PFM and combined work on customs administration and governance, also with the IDB. Selectivity also responded to GON’s request in specific areas, including the mobilization of the Global and Food Security Program to link small-holder producers to markets. Alignment 4. The CPS objectives were broadly aligned with the 2013 corporate twin goals of poverty reduction and shared prosperity goals. Although the CPS objectives did not target or monitor poverty and shared prosperity directly, the proposed interventions (on basic services and rural infrastructure) could conceivably contribute to the twin goals directly or indirectly. The CPS maintained IDA’s focus on key areas to reduce poverty, including basic education, health, water services, rural infrastructure, and agricultural productivity. Progress on these areas could help raise incomes for the poorest 40 percent of the population (shared prosperity). Other interventions (on the investment climate, access to finance, and energy) could also help raise those incomes by increasing overall economic growth. 5. Development Outcome Overview of Achievement by Objective: 5. Following the shared approach, this assessment considers the extent to which CPS objectives were achieved as reflected in the CPS results matrix and updated at the PLR stage. As the CPS results matrix did not articulate specific objectives, this assessment uses the specific objectives indicated in the PLR. In sum, this review uses the following structure and terminology: two focus areas (or pillars), eight objectives, and fourteen outcomes. Focus Area I: Improve access to quality basic services. 6. Focus Area I had three objectives: (i) improve educational attainment, (ii) improve overall health of the population, and (iii)) design and implement a results-based financial management system. 7. Objective 1: Improve educational attainment. This objective was aligned with GON’s Education Sector Plan (ESP) to improve: (i) the coverage and quality of preschool education, (ii) completion of primary education; and (iii) the coverage and quality of secondary education. This objective was supported through the Social Protection Project (FY11), the Second Support to the Education Sector Project (FY12), the Education Sector Strategy Support Project (FY13), and the Alliance for Education Quality Project (FY17). This objective had two outcomes and associated indicators: • Increase in the completion rate of primary education (1st to 6th grade) in targeted municipalities: Due to changes in data definitions, the PLR reported disaggregated by gender only through 2014 (69 percent girls, 66 percent boys, and 67.5 percent total) and the total rate only through 2015 (71.4 percent). Based on these numbers (which IEG could not verify), progress was significant, albeit below targets. This progress is consistent with official data showing an increase in the countrywide completion rate from 80.4 percent in 2010 to 92.2percent in 2013 1. However, the latter refer to the total population, not to the population in the targeted municipalities. The Social Protection Project and the FY12 and FY13 education projects, listed above, may have helped improve completion in those municipalities by 1 Nicaragua, Revisión Nacional 2015 de la Educación para Todos. Informe preparado por las autoridades nacionales competentes en vistas del Foro Mundial sobre la Educación (Incheon, República de Corea, del 19 al 22 mayo de 2015). August 2014. For Official Use Only CLR Review 5 Independent Evaluation Group interventions such as providing school lunches, teacher and student supplies and textbooks, teacher certification, and improved teaching methods. [Partially Achieved]. • Increase in Grade 9 (last year of lower secondary education) completion rate in targeted municipalities: Due to changes in data definitions, the PLR reported progress only through 2014 (54 percent, 52 percent, and 53 percent respectively). Under the new data definitions, the FY13 project changed the total baseline and target to 64 percent and 71 percent, respectively. The last ISR for the project reports a 71.9 percent completion rate was achieved in 2017, thereby exceeding the new target. Interventions similar to those for primary education supported by IDA projects helped achieve these results [Achieved]. 8. The CLR notes that the indicators above are not reliable measures of education quality. Quality may have declined over the CPS period. The primary education quality index tracked by the World Economic Forum declined from 2.7 in 2012 to 2.5 in 2017, with Nicaragua’s rank declining from 123 to 132. On balance, IEG rates Objective 1 as Partially Achieved. 9. Objective 2: Improve overall health of the population. On the health dimension, this objective was supported through the Improving Community and Family Health Care Services Project (FY11), the associated additional financing (FY14), and the Strengthening the Public Health Care System Project (FY15). On water and sanitation dimension, this objective was supported through the Rural Water and Sanitation Project (FY08), the associated additional financing (FY13), the Greater Managua Water and Sanitation Project (FY09), the Adaptation of Water Supplies to Climate Change Global Environmental Facility (GEF) Project (FY13), the Sustainable Rural Water Supply and Sanitation Sector Project (FY14), and the FY15 NLTA on Creating Sustainable Sanitation Services. IFC supported health services through a loan to a private hospital. MIGA supported private investment in a ceramic manufacturing company (for sinks and toilets). This objective had four outcomes and associated indicators: On access to health services: • Increase in percentage of institutional deliveries (i.e., deliveries made by qualified health personnel) in targeted municipal health networks. The target of 86 percent was surpassed at 93 percent. [Achieved] • Increase in percentage of post-partum women receiving postnatal care. The target of 55 percent was surpassed at 65 percent. [Achieved] • Increase in percentage of children less than one year old immunized with the Pentavalent vaccine in targeted municipal health networks. The target of 98 percent was surpassed at 100 percent. [Achieved]. On access to water and sanitation: • Increase in sustainable access to water supply and sanitation services in rural, indigenous territories, to 45,000 people (water) and 47,000 people (sanitation). The target for water was surpassed (at 64,440). Achievements on sanitation were below target (at 44,120). There is no indication whether the access provided is sustainable or not (the CPS highlighted the need to ensure the financial sustainability of water systems). [Mostly Achieved]. 10. The four outcome indicators discussed above focus on input quantities (access to health, and to water and sanitation services) and do not capture the quality of services or impact on health. Nevertheless, for people that did not have access to health or water services, health is likely to have improved. With these caveats, the three health services targets achieved, and the water services target mostly achieved, IEG rates Objective 2 as Mostly Achieved. 11. Objective 3: Design and implement a results-based financial management system. IDA supported this objective through its Public Financial Management (PFM) Modernization Project (FY11). 12. The CPS sought one outcome under this objective: Multi-year sectoral strategy informs the budget, as measured by an improvement in the Public Expenditure and Financial Accountability For Official Use Only CLR Review 6 Independent Evaluation Group Indicator # 12 (“multi-year perspective in fiscal planning, expenditure policy and budgeting”), with a 2010 baseline of “C” and a 2017 target of B+. It was achieved in 2015, as measured by the latest PEFA. The FY 11 project contributed to this outcome by supporting improvements in government capacity, the renewal of the Integrated Financial Management System (SIGAF), and the implementation of SIGAF. [Achieved]. 13. It is noted, however, that the result above is not reflected in the CPIA “quality of budgetary and financial management” rating, which declined from 4 in 2010 to 3.5 from 2011 to 2016. The CPIA ratings cast some doubt on the impact of the outcome on the quality of the financial management system. It is also unclear whether the PEFA rating would have been sustained through 2017, although the CLR notes that, in 2017, the government continued to implement the results-based budget framework with multi-annual and medium-term projections. On balance, IEG rates Objective 3 as Mostly Achieved. 14. Given the ratings of objectives 1 to 3 (1 Partially Achieved and 2 Mostly Achieved), IEG rates Focus Area I as Moderately Satisfactory. On education, the CPS made progress on completion rates for primary and lower secondary education, but the quality of education remained low. On health, the CPS met or surpassed its maternal and child health care targets, and closely achieved targets on expansion of water and sanitation services (without information on the share of the population covered), but there is no information on extent to which actual health improved. On PFM, the outcome to inform GON’s budget with a multiyear perspective was achieved. However, this did not result in an improvement of the quality of budgetary and financial management as measured by the respective CPIA rating. Focus Area II: Improve competitiveness and productivity. 15. Focus Area II had five objectives: (i) expand rural infrastructure, (ii) increase renewable energy production, (iii) increase agricultural productivity, (iv) improve the investment climate, and (v) improve access to finance. 16. Objective 4: Expand rural infrastructure. This objective was supported through three projects: the Fourth Roads Rehabilitation and Maintenance Project (FY06), the Rural Roads Infrastructure Investment Project (FY12) and its Additional Financing (FY14), and the Rural and Urban Access Improvement Project (FY17). IDA supported access to telecommunications through the Rural Telecommunications Project (FY06) and the Caribbean Regional Communications Infrastructure Program (FY17). The CPS sought two outcomes and related targets under this objective as follows: • Increase in the number of rural people with access to an all-season road: The target (1,019,000) was surpassed at 1,077,108. [Achieved]. • Increase access to telephone services: due in part to data constraints, the baselines and targets covered both rural and urban areas. The targets of 117 (telephone) and 16.5 (internet), per 100 people, were achieved in 2015, the last year for which the CLR reported coverage. [Achieved]. 17. Although the telecom data covered both rural and urban areas, it was understood that in 2012 most urban centers already had very high levels of ICT penetration, particularly mobile, and therefore the changes in the indicators would mostly demonstrate progress in rural areas. With its two outcomes achieved, Objective 5 is rated as Achieved. 18. Objective 5: Increase renewable energy production. To support this objective, IFC invested in the San Jacinto Geothermal Power Plant and MIGA provided guarantees for the Eolo wind farm. 19. This objective had one outcome indicator: Additional 100 MW of renewable energy in the system. This target was surpassed with the San Jacinto Plant, which has been operational since 2013 and added 62 MW, and the Eolo Plant, which has been operational since December 2012 and added 44 MW. Total electricity production from renewable sources other than hydroelectric increased by 277 MW in 2014 alone. [Achieved]. For Official Use Only CLR Review 7 Independent Evaluation Group 20. The outcome above contributed to increase the reliance on renewable sources of energy, which advanced (excluding hydroelectric) from 32.4 percent in 2012 to 45.0 percent in 2014 2. Objective 6 is rated as Achieved. 21. Objective 6: Increase agricultural productivity. Bank support included the Second Agricultural Technology Project (FY06), and its Additional Financing (FY10), the Caribbean Coast Food Security Project (FY15), and the Agriculture Public Expenditure Review (FY13). IFC invested in a sugar plantation and, together with IDB and other partners, on financing farmers to restore coffee plantations. MIGA provided guarantees on a project to develop bamboo plantations. 22. This objective had one indicator: increase in crop production by farmers benefitting from technical assistance programs of the Nicaraguan Institute of Agricultural Technology from a 2015 baseline of 1,800 metric tons to a target of 4,000 metric tons. 23. Although the outcome indicator does not reflect changes in productivity, the ICRR for the IDA FY06 project reported significant increases in productivity for the farmers participating in the project, surpassing productivity targets. The Nicaraguan Institute of Agricultural Technology (INTA) surveys showed that yields for maize, beans and rice increased 16 percent over the national average. Farmers participating in the project had yields 60 percent higher than farmers than did not participate in it. The FY06 project contributed to this outcome through agricultural extension and seed development programs. IFC AS and investments supported improvements in coffee farmers' access to training, crop inputs, and financial services, but there is no indication of their productivity impact. Objective 7 is rated as Achieved. 24. Objective 7: Improve the investment climate. This objective was aligned with NHDP’s attention to the role of micro, small and medium enterprises in stimulating growth and creating jobs. The Bank supported this objective through the Micro, Small and Medium Enterprise (MSME) Development Project (FY08). 25. This objective had two outcome indicators: • Increase in MSME sales by 150 percent, from a baseline of 0 to a target of 600. Although the CPS or PLR did not indicate it, the baseline and target appear to refer to the number of enterprises that increased sales under the MSME project. The CLR notes that 617 of the 864 MSMEs that received project grants increased their sales by 165 percent on average, well over the average elsewhere (0.8 percent and 0.3 percent for small and for medium firms, respectively 3). Accordingly, the indicator is biased upwards by its exclusion of the MSMEs that reduced or did not expand sales [Partially Achieved]. • Reduce the number of days to register a new business, from a 2012 baseline of 39 days to a 2017 target of 10 days. Achievement of this target was close, at 12 days in 2017. The MSME project also supported this outcome. [Mostly Achieved]. 26. The MSME project’s sales outcome covers an insignificant share of MSMEs (Nicaragua has about 120,000 MSMEs as of 2005 4). It is unlikely to reflect an impact on, or a result from changes in the investment climate. Although the lower number of days required to open a new business and other actions outlined in the CLR may have had a positive effect, they did not suffice to improve Nicaragua’s business climate. Nicaragua’s rank in ease of doing business index declined from 119 to 131. This casts doubt on the extent to which the objective was achieved. On balance, IEG rates this objective as Partially Achieved. 27. Objective 8: Improve access to finance. IFC provided a loan, together with the Global Agriculture and Food Security Program (GAFSP) Private Sector Window, to the Fondo de Desarrollo 2 Latest data from WDI. 3 ICRR for the MSME project. 4 Rodrigo Urcuyo, Microfinanzas y Pequeñas y Medianas Empresas en Nicaragua Central Bank of Nicaragua. Banco Central de Nicaragua. 2012. For Official Use Only CLR Review 8 Independent Evaluation Group Local, the largest microfinance institution in Nicaragua, with a rural presence and focus on the agribusiness sector. 28. This objective had one outcome indicator: to increase in the number of people, microenterprises, and SMEs reached with financial services, from a 2012 base line of 62,152 to a 2017 target of 85,200, which the CLR reports was surpassed at 85,790. However, IEG could not verify that IFC’s credit lines contributed to this outcome as IFC’s supervision report did not report it. [Not Verified]. 29. The outcome indicator does not reflect the amount of finance that MSMEs accessed. To adequately measure the achievement of the objective, a financial outcome (e.g., average outstanding loans per existing MSME) would have been a useful complement to the number of persons reached with services. While it is possible that MSME access to finance improved (the overall share of domestic credit to the private sector in GDP increased from 28.7 percent in 2012 to 38.7 percent in 2016 5), the extent to which MSMEs benefited from this increase is unclear. On balance, IEG rates Objective 9 as Not Verified. 30. Given the ratings of objectives 5 to 9 (3 Achieved, 1 Partially Achieved, and 1 Not Verified), IEG rates Focus Area II as Satisfactory. Progress was as expected on expanding rural infrastructure, renewable energy, and agricultural productivity. Progress on the investment climate was unclear. Progress on access to finance was not verified. Overall Assessment and Rating 31. IEG rates the CPS development outcome as Moderately Satisfactory. The Program achieved uneven results in Focus Area I (improve access to quality basic services). These included increased delivery of education and health services, but quality of education remained low and impact on health unreported; and a higher number of people in rural areas with access to water and sanitation. Progress on public financial management met the CPS outcome target, but an alternative indicator of that outcome casts doubt on the extent or scope of that progress. The Program also achieved results in Focus Area II (improve competitiveness and productivity). These included expanded access to roads and telecommunications, increased reliance on renewable energy sources, and increased agricultural productivity. IDA’s impact on the investment climate was unclear from somewhat contradictory indicators. IEG could not verify the extent to which WBG support increased access to finance by MSMEs. Objectives CLR Rating IEG Rating Focus Area I: Improve Access to Moderately Quality Basic Services. Satisfactory Objective 1: Improve educational Two outcomes “Mostly Partially Achieved attainment. Achieved”. Objective 2: Improve overall health 3 outcomes “Achieved” and 1 Mostly Achieved of the population. “Mostly Achieved” Objective 3: Design and implement a results-based financial 1 outcome “Achieved” Mostly Achieved management system. Focus Area II: Improve Satisfactory competitiveness and productivity. Objective 4: Expand rural 2 Outcomes “Achieved” Achieved infrastructure. Objective 5: Increase renewable 1 Outcome Achieved Achieved energy production. Objective 6: I Increase agricultural 1 outcome “Achieved” Achieved productivity. 5 World Development Indicators For Official Use Only CLR Review 9 Independent Evaluation Group Objective 7: Improve the 1 outcome “Mostly Achieved and Partially Achieved investment climate. 1 outcome “Achieved Objective 8: Improve access to 1 Outcome “Achieved” Not Verified finance. 6. WBG Performance Lending and Investments 32. During the CPS period, IDA approved 14 new operations including Additional Financing amounting to $439.9 million. From FY13 to FY17, the Bank’s active portfolio increased by 25.2 percent from 390.4 million to $488.9 million. In addition to the new IDA operations, IDA leveraged its assistance with operations funded by partners. Most significant were the FY13 Education Sector Strategy Support Project (funded by the Global Partnership for Education and the European Union), and the FY15 Caribbean Coast Food Security Project (funded by the Global Agriculture and Food Security Program). Including new trust fund commitments ($97.04 million), new operations during the CPS period ($536.9 million) were 74.2 percent above new operations approved under the previous CPS ($308.1 million, including trust fund commitments). This acceleration may reflect both IDA’s satisfaction with improved portfolio performance as well as its ability to leverage IDA funding with resources from other donors (CLR, para. 59). 33. New IDA commitment allocations were higher (exceeding 10 percent of total allocation) for roads, education, health, and land administration. The shares of new commitments were significantly higher than those of pre-existing operations for education and health, and significantly lower for social protection, water, roads, and private sector development, perhaps reflecting GON’s human development priorities. All operations were in the form of IPFs. 34. Nicaragua’s portfolio at exit performed better than the average for LCR and the Bank. Of nine projects that IEG validated, 89 percent (all but one project) were rated Moderately Satisfactory or better, surpassing the averages for LCR (70percent) and the Bank (72percent). Risk to Development outcome ratings were more dispersed, ranging from negligible to high, but also performed relatively better (44 percent of projects with risks rated moderate or lower) than LCR rating (52percent), albeit similar to the overall Bank rating (45 percent). 35. Nicaragua’s active portfolio performed better, compared to LCR and the Bank. The share of the number of projects at risk averaged 10 percent, less than the shares for LCR (23 percent) and the Bank (21 percent). The share of commitments at risk was also lower for Nicaragua. Average disbursement ratios were also higher for Nicaragua (35 percent) than for LCR (21 percent) or the Bank (20 percent). The CLR suggests that this performance was underpinned by an effective portfolio management system that featured continuous communications with GON as well as extensive portfolio reviews twice a year. 36. During the CPS period from FY13 to FY17, IFC made a total net commitment of US$513.9 million. IFC’s short term trade finance guarantee account for 83.1 percent of this total net commitment for the five-year period. IFC’s core investment of equity investments and long-term loan was only $86.7 million with average annual net commitment of US$17.8 million. The largest IFC project was a $30 million loan to a financial institution in Nicaragua in FY17. 37. During the review period, IEG validated one Expanded Project Supervision Reports (XPSRs) of IFC investment project, and the EvNotes assigned it a Mostly Successful development outcome rating. The project generated positive returns to financiers, but economic benefits were not as strong as envisaged, though the project exceeded targets in producing direct jobs for women and local purchases in poor parts of the country. 38. During the review period, MIGA underwrote its guarantees for five projects with a total gross exposure of $89.0 million. MIGA guarantees were provided to foreign direct investments in agribusiness, manufacturing, and the banking sector. For Official Use Only CLR Review 10 Independent Evaluation Group Analytic and Advisory Activities and Services 39. During the CPS period, 12 ASA tasks (5 of the 17 planned and 7 unplanned) were completed. Completed tasks covered some of the areas where IDA provided project support (Agriculture, PFM, and water/sanitation), other topics not linked to WBG projects (e.g., TA on anti-money laundering), and aggregative analyses in the FY13 Country Economic Memorandum (CEM). Furthermore, IDA completed the FY17 Systematic Country Diagnostic (SCD) and included Nicaragua in three Central America regional reports (social expenditures, doing business, and school drop-outs). Two of the dropped tasks (the poverty and financial sector assessments) were to cover topics of critical importance for Nicaragua and the CPS, given that prior IDA work in these areas (in FY10 and FY 11 respectively) may have needed updating. ASA products provided the basis for country dialogue. Nevertheless, evidence of dissemination is limited, with only a few reports readily available to the public in the Bank’s Open Knowledge Repository. 40. During the FY13-FY17 period, IFC approved four new AS projects amounting to $2.2 million of IFC funds. IFC has carried out projects in the financial sector, the agricultural sector, and investment climate reforms. One IFC AS project sought to provide a strategy and business plan advice to financial institutions in Nicaragua to increase its reach in rural areas through the adoption of digital financial services. Another project aimed at supporting the renovation of coffee farms that are more resilient to future disease outbreaks. 41. During the review period, IEG produced EvNotes for two Project Completion Reports (PCRs) of AS projects. IEG assigned a Mostly Successful Development Effectiveness rating to one project and a Mostly Unsuccessful rating to another project. The AS project in the coffee sector supported the development of coffee plant renovation toolkit, while another AS project was not very successful in creating an incubation center. Results Framework 42. The CPS objectives were well-aligned with country development goals and addressed critical constraints. On health, for example, the CPS aim of better overall health was aligned with GON’s program to address inadequate delivery of health services at the community level, a critical constraint. The results chain broadly reflected the links between WBG interventions to inputs, outputs, outcomes and CPS objectives. For example, health projects financed capitation payments to encourage increased delivery of basic health services and hence health outcomes. Overall, outcome indicators were measurable, and had baselines and targets. However, the results framework (e.g., on water services and the investment climate) could have been clearer by explicitly stating the CPS objectives (not just pillars). Moreover, the extent to which outcome indicators reflected objectives was limited by their exclusion of the quality dimension of service delivery (e.g., education and health). Furthermore, an outcome indicator for one of the investment climate outcomes was not well defined (MSMEs). The CLR did not discuss exogenous factors or unintended effects with a possible bearing on the results achieved. The CLR also lacked a discussion of how some interventions (e.g., on water and MSMEs) scaled-up to country level outcomes. Partnerships and Development Partner Coordination 43. The CPS planned on specific areas of coordination and collaboration with the IDB and the IMF, as well as mobilization of resources from development partners. During implementation, the WBG mobilized significant resources from partners and worked jointly with IDB to strengthen Nicaragua’s capacity to engage in Public-Private Partnerships. The CLR also noted WBG’s ASA contribution to helping the Government and donors develop rural development strategies, as well as its broader convening role among donors for support in key sectors, such as education, social protection and agriculture. Safeguards and Fiduciary Issues 44. During the review period, safeguards policies were triggered in all nine operations that were closed and validated by IEG during the review period, in the agriculture, market and finance, transport and water practices. Compliance was generally reported as satisfactory, with the proper application of For Official Use Only CLR Review 11 Independent Evaluation Group the social and environmental safeguard instruments, the respect of standard mitigation measures and faithfulness to the guidelines. However, the project ICRs and ICRRs noted some challenges related to historical sociopolitical considerations of indigenous peoples in the country, and the inadequate staffing of project teams. It is noted that none of those shortcomings had a negative impact on project compliance with the safeguard policies. Overall, the projects had positive impacts on the environment and the population. The Bank provided consistent institution strengthening in key environmental and social areas. The ICRs and ICRRs reported the recognition, inclusion and participation of Indigenous Peoples, the acknowledgement of their land rights as well as their local cultural practices in the project design, with special attention to gender. No Inspection Panel investigation was documented during the review period. 45. INT noted 14 complaints during the period FY 2013 to FY 2017 related to Bank-financed operations across various sectors. There were two substantiated cases, one related to the Hurricane Felix Emergency Recovery Project and the other related to the Education sector. IDA cancelled the Hurricane Felix Project. Ownership and Flexibility 46. Ownership, both at the design stage and implementation stages, was strong in most areas. Congruence with GON programs and IDA’s consultation with a broad range of stakeholders suggest ownership at the design stage. The CLR notes that well-organized portfolio management, with strong arrangements for communications with the Ministry of Finance and sector institutions, underpinned commitment. On flexibility, the PLR reported that the results framework was revised where implementation was slower than anticipated (e.g., by dropping or replacing pre-school enrollment, education quality, and agricultural productivity outcomes). WBG Internal Cooperation 47. The CPS and PLR outlined Bank and IFC interventions, as well as areas of collaboration (e.g., on agriculture), in support of program objectives, with the Bank focused on Investment Project Financing (IPF) of public programs and IFC/MIGA focused on private participation. For example, in education, IDA focused on interventions to improve the delivery of public education and health services and IFC was to work on financing private sector solutions in the education and health sector. Planned joint work included a Joint IFC-WB technical assistance program on financial innovation. However, the CPS implementation does not demonstrate joint IDA and IFC/MIGA activities and the CLR does not provide indications of how the three institutions collaborated. IFC covered some areas outside CPS objectives (exports, environmental sustainability in local mining). The planned joint effort on financial innovation did not materialize. Risk Identification and Mitigation 48. The CPS articulated risks from political economy developments, external shocks and natural disasters that could derail government programs. The PLR added risks from program or project design, environmental and social developments, capacity constraints (particularly in rural and remote areas), and the fiduciary environment. To address these risks the CPS and PLR identified general and specific mitigation measures. For example, to address political economy risks, the CPS planned on maintaining close coordination with development partners and diverse stakeholders and, more specifically, to align the CPS with the political cycle. However, as the PLR noted, when capacity constraints risks materialized on early childhood education, impeding rural areas from meeting the original CPS preschool enrollment targets, the mitigation measures (strong commitment to reforms and institutional strengthening project components) did not fully neutralize the risk in this case. Support for risk mitigation included, in particular, an FY14 regional project on catastrophe risk insurance, which benefited from the IDA regional allocation and provided Nicaragua with policy payout (in cash and within two weeks) in the event of a hurricane or earthquake of sufficient fiscal impact in line with pre-agreed fiscal trigger levels. For Official Use Only CLR Review 12 Independent Evaluation Group Overall Assessment and Rating 49. IEG rates WBG performance as Good. The CPS addressed well-identified development challenges and benefited from congruence with government programs and consultation with multiple stakeholders. The selected CPS areas were consistent with WBG poverty reduction and shared prosperity objectives (e.g., by focusing on basic services), although some critical areas (vocational education and training,) did not receive enough attention. The CPS was selective, aligning support with focus areas, and with proposed interventions based on the WBG’s extensive country knowledge, their congruence with NHDP goals, and their possible impact. Planned selectivity also considered a sectoral division of labor with the IDB. Planned operations included interventions that could reasonably be expected to achieve objectives in most areas. The results framework could have been clearer by explicitly articulating the CPS objectives, and defining some outcomes and indicators were inadequate). The use of IPFs and ASA, as well as IFC investments and MIGA guarantees as WBG instruments was appropriate. The knowledge base for the CPS was appropriate, with ASA addressing some of the same areas covered by IPF and including core products. The CPS and PLR identified risks, mitigation measures adequately. However, not all measures were sufficient to mitigate risks. When a capacity risk materialized on education, planned mitigation measures did not suffice to neutralize this risk. 50. Implementation benefited from a country environment that was free from major adverse shocks during the CPS period. There were indications that the WBG and the government worked well in coordinating implementation through well-structured communications that strengthened portfolio management, including joint comprehensive portfolio reviews twice a year. During implementation, the PLR made some revisions to the results framework, primarily downgrading expected outcomes where implementation was slower than anticipated and defining better some of the program’s outcome indicators. However, it failed to articulate the CPS objectives in the results matrix. Bank-IFC activities were largely separate and independent from each other, with no evidence of the stronger collaboration that the CPS anticipated. There were no major safeguard issues. INT noted two complaints that were substantiated. 7. Assessment of CLR Completion Report 51. The CLR provides an informative assessment. The CLR provided evidence on the extent to which outcomes were achieved as well as on WBG’s contribution to those outcomes, albeit limited by inadequacies in some indicators. However, its assessment of the development outcome could have been more consistent with the results framework and the Shared Approach of IEG/WBG on Assessing Country Engagement. The CLR discussed each of the fourteen outcomes with no discussion or rating of the eight objectives. There was also an inadequate attention to the role ASA may have played. The CLR provided little detail on implementation challenges and IDA responses to those challenges. Lessons could have been more specific and better articulated. 8. Findings and Lessons (see comments in the ES). 52. IEG agrees with CLR lessons which are summarized as follows. First, IDA’s convening power can increase financing and catalyze development through levering its resources with those of other donors. Second, Government commitment combined with effective communication channels can improve portfolio management and implementation. Third, increased women participation (e.g., in roles under community rural road building programs) can help reduce poverty and contribute to shared prosperity. Fourth, existing institutional capacity levels and commensurate implementation arrangements are key determinants of the development objectives that can be achieved. Fifth, access to quality data will improve decision-making. 53. IEG provides the following additional lessons: • First, Nicaragua’s quest for improved social services would benefit from a stronger focus on quality. In the case of Nicaragua, available indicators suggest that primary education quality has not improved. A focus on education requires monitoring of quality levels. Complementing For Official Use Only CLR Review 13 Independent Evaluation Group completion rates with periodic test scores will help understand what works for improving learning outcomes. • Second, WBG’s development effectiveness and impact could be further enhanced through joint Bank/IFC implementation. In the case of Nicaragua, it was envisaged in the CPS to have joint IDA/IFC work in education, health services and financial innovation. However, joint implementation did not materialize and the Bank/IFC pursued parallel and separate activities. Annexes CLR Review 15 Independent Evaluation Group Annex Table 1: Summary of Achievements of CPS Objectives Annex Table 2: Nicaragua Planned and Actual IDA Lending, FY13-17 Annex Table 3: Advisory Services and Analytics Deliveries for Nicaragua, FY13-17 Annex Table 4: Nicaragua Grants and Trust Funds Active in FY13-17 Annex Table 5: IEG Project Ratings for Nicaragua, FY13-17 Annex Table 6: IEG Project Ratings for Nicaragua and comparators, FY13-17 Annex Table 7: Portfolio Status for Nicaragua and Comparators Annex Table 8: Disbursement ratio for Nicaragua and Comparators, FY13-17 Annex Table 9: Net Disbursement and Charges for Nicaragua (US$ M), FY13-17 Annex Table 10: Total Net Disbursements of Official Development Assistance Annex Table 11: Economic and Social indicators for Nicaragua, 2013-2016 Annex Table 12: List of IFC Investments in Nicaragua Annex Table 13: List of IFC Advisory Services in Nicaragua Annex Table 14: IFC net commitment activity in Nicaragua, FY13 - FY17 Annex Table 15: List of MIGA Activities in Nicaragua, 2013-2017 Annexes CLR Review 17 Independent Evaluation Group Annex Table 1: Summary of Achievements of CPS Objectives – Nicaragua CPS FY13-FY17: Focus area I: Actual Results Improve Access to Quality IEG Comments (as of current month/year) Basic Services CPS Objective 1: Improve educational attainment. Outcome (1): Increase in the This outcome was supported by the Second At the PLR stage, the target completion rate of primary Support to the Education sector project values were revised education (1st to 6th grade) in (P126357; FY12) and the related additional downwards to incorporate targeted municipalities financing (P160057; FY17). The projects aimed new available data. The new to (a) improve the students' retention rate in data also resulted in the Indicator: Primary completion rate Primary Education Schools located in correction and downward in targeted municipalities Participating Municipalities; and (b) strengthen revision of the baseline Baseline (2010): MINED’s education management capacity. values. The formulation of Combined: 56.7% The outcome was also supported by the the original outcome was as Girls: 58% Nicaragua Social Protection project (P121779; follows: “Increase in the Boys: 54% FY11) which sought to improve Public completion rate of primary preschool and primary retention rates in education: Target (2017): selected municipalities. Baseline (2010): Combined: 75% Girls: 81% Girls: 77% This outcome has also received some support Boys: 69% Boys: 74% from the Alliance for Education Quality Project Combined: 75% Major (P161029:FY17) which is aiming to improve (a) Target (2017): Outcome teacher practices for participating teachers in Girls: 87% Measures preschool, primary and secondary education Boys: 83% nationwide, Combined: 85% and (b) physical learning conditions in targeted schools. Also, at PLR, the CPS outcome related to increase None of the projects that supported this in the coverage of pre-school outcome included this as an indicator to track education (ages 3-5) was progress on the outcome. taken out and the name of Focus Areas I was changed Due to changes in data definitions, the FY13-17 from “Raise social welfare by PLR reported progress disaggregated by improving access to quality gender only through 2014. According to the basic services”. PLR, the primary school completion rate (national) increased from 64.2 percent in 2010 to 77.8 percent in 2014. In the selected municipalities, the primary school completion rates increased from 56.7 percent in 2010 to 67.5 percent in 2014. For boys in the selected municipalities, the report indicated an increase from 54% to 66% while for girls, the increase was from 58% in 2010 to 69% in 2014. The FY13-17 CLR report indicated an increase in the primary completion rate from 56.7 percent registered in 2010 to 71.4 percent in 2015 although it did not disaggregate the data by gender. These figures could not be verified. Annexes CLR Review 18 Independent Evaluation Group CPS FY13-FY17: Focus area I: Actual Results Improve Access to Quality IEG Comments (as of current month/year) Basic Services According to data from the 2015 National Review of Education for All report, the national primary school completion rate advanced from 80.4% (2010) to 92.2% (2013). Partially Achieved Outcome (2): Increase in Grade This outcome was supported by the two The project’ results reporting 9 (last year of lower secondary projects discussed above and by the Education on completion rates in the education) completion rate in Sector Strategy Support Project (P133557; targeted municipalities did targeted municipalities: FY13) whose objectives are to: (a) increase not disaggregate the results access to preschool education in selected by gender. Indicator: Grade 9 completion rate municipalities, and to improve preschool in targeted municipalities. education learning conditions nationwide; and Before the PLR, the original Baseline (2010): (b) increase access to lower secondary Outcome was: Combined: 44.5% education in selected municipalities, and Quality of Education in Girls: 45% improve lower secondary education quality and primary and lower secondary Boys: 43% completion rates nationwide. improved as measure by national standardized tests Target (2017): According to the November 2017 management • Increase in the percentage Combined: 57% supervision report for the Education sector of Grade 9 students Girls: 57% strategy support project (ISR:S), the combined achieving advanced or above Boys: 57% grade 9 completion rate for the 2017 school proficiency levels year in selected municipalities was 71.9 percent standardized evaluations which is higher than the CPS target. from 4.4% to 9% in Math and from 37.4% to 44% in Achieved Spanish in 2010 and 2017, respectively. CPS Objective 2: Improve overall health of the population Outcome (3): Increase in This outcome was supported by the Community At the 2014 AF restructuring percentage of institutional and Family Health Care Services project of the Community and Family deliveries in targeted municipal (P106870; FY11) and the associated additional Health Care Services project health networks: financing (P146880; FY14). The projects sought (P106870; FY11), new to i) improve the access to, and the quality of, targets were set for 34 Indicator: Percentage of preventive and promotion health and nutrition additional municipalities. For institutional deliveries in targeted services among poor and vulnerable the new set of municipalities, municipal health networks. populations in Nicaragua; (ii) strengthen the the percentage of institutional Baseline (2011): 72% operational capacity of the Nicaragua Ministry of deliveries increased from Target (2015): 86% Health through the rehabilitation of health 73% in 2012 to 78% in 2016. centers; and (iii) ensure financial support in case of a public health emergency. This outcome was also supported by the Strengthening the Public Health Care System project (P152136, FY15) which supported improvements in the quality of health services in selected municipal health networks through the financing of Capitation Payments to Selected Municipal Health Networks. Annexes CLR Review 19 Independent Evaluation Group CPS FY13-FY17: Focus area I: Actual Results Improve Access to Quality IEG Comments (as of current month/year) Basic Services According to the IEG review for the Community and Family Health Care Services project IEG:S, the percentage of institutional deliveries in the 32 originally targeted municipal health networks, increased from 72% at baseline to 93% in 2016. Achieved Outcome (4): Increase in This outcome was supported by three projects: At the PLR stage this percentage of post-partum the Community and Family Health Care outcome was added to women receiving postnatal Services project (P106870; FY11), its related measure the relevant support care: additional financing (P146880; FY14) and the of the WBG program. Strengthening the Public Health Care System Indicator: Percentage of post- project (P152136, FY15). At the 2014 AF restructuring partum women receiving postnatal IEG:S for the Community and Family Health of the Community and Family care. Care Services project indicated that the Health Care Services project Baseline (2011): 32% percentage of post-partum women receiving (P106870; FY11), new Target (2014): 55% postnatal care within ten days of delivery in the targets were set for 34 32 original project municipalities targeted MHNs additional municipalities. For increased from 32% at baseline to 65% in 2016. the additional municipalities, the percentage of post- Achieved partum women receiving postnatal care within 10 days of delivery increased from 50% in 2012 to 73% in 2016. Outcome (5): Increase in This outcome was supported by the three At the 2014 AF restructuring percentage of children less than projects discussed above: the Community and of the Community and Family one year old immunized with Family Health Care Services project (P106870; Health Care Services project the Pentavalent vaccine in FY11), its related additional financing (P146880; (P106870; FY11), new targeted municipal health FY14) and the Public Health Care System targets were set for 34 networks: project (P152136, FY15). additional municipalities. For the additional municipalities, Indicator: Percentage of children According to IEG:S for the Community and the percentage of children less than one year old immunized Family Health Care Services project, the less than one-year-old with the Pentavalent vaccine in percentage of children less than one-year-old immunized with the targeted municipal health immunized with the Pentavalent vaccine in Pentavalent vaccine networks targeted MHNs achieved full coverage (100%) achieved 97% in 2016, exceeding the original target of 98.5%. coverage in 2016. Baseline (2011): 88% These results refer to the first 32 municipalities Target (2014): 98% covered by the project. Target Achieved Outcome (6): Increase in The outcome was supported by the Rural At the PLR stage, this sustainable access to water Water Supply and Sanitation (P106283, FY08) outcome was revised to supply and sanitation services and the related additional financing (P132102; reflect the WBG program. in rural, indigenous territories: 2013). The projects sought to increase access Instead of measuring access by project beneficiaries to sustainable water at the national level, the PLR Indicator: Number of people with and sanitation services in rural areas of revised the baselines and sustainable access to water and Nicaragua. targets to reflect the 108 sanitation services in rural areas. municipalities that are supported by the WBG. Annexes CLR Review 20 Independent Evaluation Group CPS FY13-FY17: Focus area I: Actual Results Improve Access to Quality IEG Comments (as of current month/year) Basic Services Baseline (2008): The outcome also received support from the Water: 0 Greater Managua Water and Sanitation project The original specification of Sanitation: 0 (P110092:FY09) which sought to increase this outcome was: “Increase access to reliable* water and sanitation in rural access to water and Target (2017): services to the population of the greater sanitation improved by 4.5pp Water: 45,000 Managua region. and 1.pp by 2014”. Sanitation: 47,000 The Bank also delivered a Non-Lending Technical Assistance (NLTA) project (P132169; FY15) whose objective was to assist in the design, planning, and execution of a pilot initiative aimed at testing a new demand-based sanitation approach and to develop new on-site sanitation technologies in Nicaragua. The outcome was also supported by the Sustainable Rural Water Supply and Sanitation Sector project (P147006; FY14) whose objective was to (a) to increase the access to sustainable WSS services in selected poor rural areas of Nicaragua. Finally, the outcome was supported by MIGA which provided a guarantee of US$11 million, covering an equity investment in a bathroom ceramic ware plant, Industria Cerámica Centroamericana S.A., as well as a trademark license. The investment aimed at contributing to greater availability of sinks and toilets in the country. According to IEG:S for the Water Supply and Sanitation project, by March 31 2015, a total of 64,440 additional beneficiaries had access to new water supply while 44,120 beneficiaries had access to (and estimated to use the) sanitation services. The June 2017 ISR:MU for the Sustainable Rural Water Supply and Sanitation Sector project reported that, by January 2017, an additional 1,257 beneficiaries had sustainable access to water supply in Project supported rural communities while only 203 had sustainable access to sanitation in Project supported rural communities. Overall, a total of 65,697 additional beneficiaries had access to new water supply while 44,323 beneficiaries had access to (and estimated to use the) sanitation services. Mostly Achieved Annexes CLR Review 21 Independent Evaluation Group CPS FY13-FY17: Focus area I: Actual Results Improve Access to Quality IEG Comments (as of current month/year) Basic Services CPS Objective 3: Design and implement a results-based financial management system Outcome (7): Multi-year sectoral This outcome was supported by the Public At the PLR stage the strategy informs the budget, as Financial Management Modernization Project outcome was revised to measured by an improvement in (P111795; FY11) whose objective was to simplify the language. The the Public Expenditure and enhance the efficiency, performance orientation, original outcome was: Fiscal Financial Accountability and transparency of Nicaragua's public and budgetary projections Indicator # 12 (Public Asset expenditures management. are analyzed under a multi- Management): annual perspective and are The August 2017 management supervision linked to budget and Indicator: Public Expenditure and report for the Public Financial Management expenditure policies through Financial Accountability Indicator # Modernization Project (ISR:MS) indicated that the implementation of the 12 (Public Asset Management): the 2015 PEFA scores for Indicator 12 was B+. MTBF and results-budgeting methodologies Baseline (2010): C According to the latest PEFA assessment report Target (2017): B+ (2015 PEFA), the score for PEFA indicator #12 was B+. However, Nicaragua’s CPIA rating for the “quality of budgetary and financial management” declined from 4 in 2010 to 3.5 in 2015 and 2016. Target Achieved Objective: Mostly Achieved. CPS FY13-FY17: Focus Area II: Actual Results Increase Competitiveness and IEG Comments (as of current month/year) Productivity CPS Objective 4: Expand rural infrastructure Outcome (8): Increase in the This outcome was supported by the Rural At the PLR stage, the original number of rural people with Roads Infrastructure Improvement Project outcome was moved to access to an all-season road: (P123447; FY12) and its additional financing milestones and this outcome (FY14) which sought to improve the access of added as a new outcome. Indicator: Number of rural people the rural population living in the Project areas with access to an all-season road to markets, and to social and administrative The original outcome was: services through: (i) improvements in the Roads in good and fair Major Baseline (2011): 945,000 Recipient's road infrastructure, and (ii) the condition as a share of total Outcome Target (2017): 1,019,000 strengthening of MTI's institutional capacity for classified roads Baseline Measures asset and disaster risk management. Two (2011): 29% of the total other projects also sought to support this classified network of 23,647 outcome: the Fourth Roads Rehabilitation and km Target (2017): 35% Maintenance Project (FY06) and the Rural and Urban Access Improvement Project (FY17) The August 2017 ISR:S for Rural Roads Infrastructure reported that by March 2017, 1,077,108 rural people had access to an all- season road. Achieved Annexes CLR Review 22 Independent Evaluation Group CPS FY13-FY17: Focus Area II: Actual Results Increase Competitiveness and IEG Comments (as of current month/year) Productivity Outcome (9): Increase in This outcome was supported by the Rural At the PLR stage this access to telephone services Telecom Project (P089989; FY06) which outcome was added to reflect (fixed line and cellular phones sought to increase access to and reduce costs the WBG support under this per 100 people) and to internet of telecommunications services in rural areas CPS that was omitted from services (subscribers per 100 of Nicaragua. A Caribbean Telecom project the original given the people) in rural areas: (P155235: FY17) is in its early implementation uncertainty in implementation. stage. Indicator: Number of fixed line Although the reported CLR and cellular phones per 100 According to IEG: S, of the Rural Telecom results measured access at people number of internet Project by June 30, 2015 the number of the national level (urban plus subscribers per 100 people in people with access to telephone services rural), the indicator was rural areas: (fixed mainlines plus cellular phones) was supposed to track changes in 117.32 per 100. The number of people with access to telephone and Baseline (2008): Telephone: access to Internet services was 16.5 internet services in rural 37.83 Internet 2.8 subscribers per 100 people. These results areas. Target (2015): Telephone: 117 included both urban and rural areas of The management completion Internet: 16.5 Nicaragua report for the Telecom project (ICR:S) noted that the tracking The World Development Indicators database of results at the national level indicates the following results by 2016: was considered strategically Mobile cellular subscriptions per 100 people: relevant because they (i) better 122.1 - Fixed telephone subscriptions per 100 allowed for aggregation across people: 5.8. A United Nations Database projects; (ii) were heavily used indicates that the number of Internet users by shareholders to understand (per 100 people) was 19.7 in 2015. the impact of WBG work; (iii) allowed international Achieved comparison; and (iv) were readily available from telecommunications operators, regulators and Information Telecommunications Union (ITU). CPS Objective 5: Increase renewable energy production Outcome (10): Additional This outcome was supported in part by a At PLR stage, this outcome 100MW of renewable energy in US$50.5 million IFC investment in the San was revised to ensure clarity. the system: Jacinto Geothermal Power Plant (27676, The original outcome was: Geothermal: San Jacinto plant FY10). The outcome was also supported by a Increased 100 MW in operating since December 2012 2013, MIGA issued guarantee of $16.3 million renewable energy (IFC, with capacity of 59MW to GME Wind (10994, 2013), covering its MIGA) (2012-2017) Wind power: EOLO plant equity investment in the project for a period of operating since February 2013 up to 20 years against the risks of transfer with capacity of 44 MW restriction, expropriation, and war and civil disturbance. The Eolo project involved the construction of a 44-megawatt wind farm in Rivas Province on the shores of Lake Nicaragua. According to the December 2017 Client Supervision report for the IFC Geothermal project, the gross generation level at San Annexes CLR Review 23 Independent Evaluation Group CPS FY13-FY17: Focus Area II: Actual Results Increase Competitiveness and IEG Comments (as of current month/year) Productivity Jacinto is at a level that is typically about 62 MW. Media reports indicate that the EOLO wind plant was inaugurated in May 2013. A 2015 MIGA brief on the project indicated that the 44 MW wind farm project is estimated to generate 178 GWh of electricity per year from a renewable energy source. Achieved CPS Objective 6: Increase agricultural productivity Outcome (11): Increase in crop This outcome was supported by the Second At the PLR stage the original production by farmers benefitting Agricultural Technology project (P087046; outcome was revised because from technical assistance FY06) and the related additional financing the WB/IFC Agriculture programs of the Nicaraguan (P114375; FY10). Together these projects Competitiveness Project did Institute of Agricultural sought to provide rural households and not materialize due to Technology: communities with broader access to Government priorities and the sustainable agricultural, forestry and natural WBG continued with the Indicator: Amount of crop resource management services and implementation of the Second production by beneficiaries innovations and to stimulate higher Land Administration Project. productivity. The original outcome was Baseline (2005): 1,800 metric ton “Improve productivity, Target (2014): 4,000 metric ton The outcome was also supported through a production and producers NLTA project (P144535; FY13) that sought to incomes in one key export support the Government of Nicaragua in its crop.” preparation and delivery of a proposal to the Global Agriculture and Food Security Program Although the project was (GAFSP). The proposal, once developed, validated by IEG, IEG:MS, the would set forth activities to improve the IEG review did not report on income and food security of poor small-scale this indicator. farmers in Honduras through more and better country-led public and private sector investment in order to: (i) raise agricultural productivity; (ii) link farmers to markets; (iii) reduce risk and vulnerability to these farmers; (iv) improve non-farm rural livelihoods; and (v) facilitate technical assistance. The outcome received additional support from the Trust Funded Caribbean Coast Food Security Project (P148809: FY15) which sought to enhance food and nutritional security in selected communities of the Caribbean Coast of Nicaragua. The Bank also delivered an Agriculture Public Expenditure Review (P127573; FY13) which would i) provide a better understanding of the level and composition of public expenditure in agriculture; ii) assess the and distribution of public spending and its effect on poverty Annexes CLR Review 24 Independent Evaluation Group CPS FY13-FY17: Focus Area II: Actual Results Increase Competitiveness and IEG Comments (as of current month/year) Productivity reduction, food security and agricultural growth in Nicaragua; and iii) provide recommendations on improving the use of public resources in the sector. IFC invested in a sugar plantation (Montelimar) and, with IDB and other partners, financed farmers to restore coffee plantations. According to the management completion report of the Second Agricultural Technology project (ICR:S), about 69,973 producers benefitted from technical assistance provided by INTA (41,983 men and 27,990 women). Accordingly, production of basic and registered seed expanded from 1,806 MT to 4,728 tons. The report also noted that INTA surveys showed that yields for maize, beans and rice increased 16 percent over the national average and that farmers participating in the project had yields 60 percent higher than farmers than did not participate in it. The outcome indicator in this case referred specifically to the amount of crop production instead of the amount of seed production as was reported in the project completion report and in the CLR. Therefore, while there was a verifiable increase in the seed production the increase in the crop production could not be verified. Not Verified CPS Objective 7: Improve the investment climate Outcome (12): Increase in This outcome was supported by the Micro, At PLR stage this outcome MSME sales by 150%: Small & Medium Enterprise Development. was added to reflect WBG Project (P109691; FY08) which sought to support which was initially Indicator: Improvement in MSME improve the competitiveness of micro, small, omitted due to slow sales and medium enterprises (MSMEs) and the implementation at the time. business climate that affects those firms. Baseline (2009): 0 The outcome indicator is Target (2017): 600 The (IEG:S) reported that within the 617 firms biased upwards by its that increased their sales during project exclusion of the MSMEs that implementation, the average rise in nominal reduced or did not expand monthly sales was 165 percent. There is no sales. information about the results for the remaining enterprises of the 864 that received project grants. Partially Achieved Annexes CLR Review 25 Independent Evaluation Group CPS FY13-FY17: Focus Area II: Actual Results Increase Competitiveness and IEG Comments (as of current month/year) Productivity Outcome (13): Reduce the This outcome was supported by the Micro, number of days to register a Small & Medium Enterprise Dev. Project new business: (P109691; FY08). Indicator: Number of days to IEG:S, indicated that the time taken for register a new business starting a business (as measured by the Bank’s Doing Business indicators) declined Baseline (2012): 39 days from 39 days to 13 by the end of the project in Target (2017): 10 days 2015. The 2017 Doing business report reported the number of days to start a new business as 13 in 2016 while the 2018 Doing business report indicated that it took 14 days to start a new business in 2017. Mostly achieved Objective: Partially achieved CPS Objective 8: Improve access to finance Outcome (14): Increase in the This outcome was supported by a FY14 IFC At the PLR stage this number of people, investment of $7 million in Fondo de outcome was added to reflect microenterprises, and SMEs Desarrollo Local (FDL) to support FDL’s IFC activities. reached with financial services: expansion of its lending in the rural agribusiness sector and to micro- Indicator: Number of people, entrepreneurs in Nicaragua through its microenterprises, and SMEs network of rural branches. FDL is the largest reached with financial services: microfinance institution in Nicaragua, with approximately 31 percent of its portfolio Baseline (2012): 62,152 concentrated in extreme and high poverty Target (2017): 85,200 regions. The IFC investment was financed by the private sector window of the Global Agriculture and Food Security Program supported this outcome. The results for this IFC project are not indicated in the supervision report. Not Verified Annexes CLR Review 26 Independent Evaluation Group Annex Table 2: Nicaragua Planned and Actual IDA Lending, FY13-17 Proposed Proposed Approved Proposed Approved Closing Outcome Project ID Project Name Amount Amount IDA FY FY FY Rating (CPS) (PLR) Amount Projects Planned Under CPS/PLR 2013-2017 P121152 NI Second Land 2013 2013 2020 38 40.0 LIR: S Administration Project P132102 NI AF Rural WSS 2013 2013 2015 6 6.0 P132108 NI (AF) Hurricane Felix 2013 2013 2015 5 5.0 Emerg. Recovery P147006 NI Sustainable Rural WSS 2014 2014 2020 30 30.0 LIR: MU Sector P149895 Regional -Catastrophe Risk 2014 2014 2021 12 12.0 LIR: S Insurance Project DROPPED Agriculture Competitiveness 2014 25 P152136 Strengthening the Public 2016 2015 2021 25 60.0 LIR: S Health Care Sys DROPPED Logistics and Trade 2015 25 Facilitation DROPPED Social Protecion 2016 25 P160359 Rural & Urban Access 2017 2017 2022 30 96.8 LIR: S Improvement Project Total Planned 209 249.8 Projects Unplanned Under CPS/PLR 2013-2017 P146845 NI Rural Roads Infrastructure 2014 2018 57.0 Imp. AF P146880 NI-(AF) Community Health 2014 2016 10.0 Project P150743 NI PFM Additional Financing 2015 2019 25.0 P155235 CARCIP-Nicaragua 2017 2023 20.1 LIR: S P160057 Additional Financing - 2017 2018 5.0 PASEN 2 P161029 ACE 2017 2022 55.0 LIR: S P163246 Additional Financing 2017 2020 18.0 PRODEP II Total Unplanned 190.1 On-Going Projects during the CPS/PLR 2013-2017 P056018 NI LAND ADMINISTRATION 2002 2013 32.6 IEG: S PROJECT P077826 NI Broad-Based Access to 2004 2013 7.0 IEG: MS Finan Services P083952 NI (CRL) Roads Rehab & 2006 2015 60.0 IEG: S Maintenance IV P087046 NI 2nd Agricultural 2006 2014 12.0 IEG: MS Technology Project P089989 NI Rural Telecom 2006 2015 7.0 LIR: MS P106283 NI Rural Water Supply and 2008 2015 20.0 IEG: S Sanitation P108974 NI Hurricane Felix 2008 2015 17.0 IEG: U Emergency Recovery Annexes CLR Review 27 Independent Evaluation Group Proposed Proposed Approved Proposed Approved Closing Outcome Project ID Project Name Amount Amount IDA FY FY FY Rating (CPS) (PLR) Amount P109691 NI Micro, Small & Medium 2008 2015 20.0 IEG: S Enterprise Dev. P110092 NI Greater Managua Water 2009 2015 40.0 IEG: MS and Sanitation P114375 NI (AF) GFRP 2nd Agric. 2010 2014 10.0 Technology P117836 NI (AF) Land Administration 2010 2013 10.0 P119709 NI (AF-C) 4th Roads Rehab 2010 2015 39.3 & Maint. P106870 NI Comm. and Family Health 2011 2016 21.0 IEG: S Care Services P111795 NI PFM Modernization TAL 2011 2019 10.0 LIR: MS P121779 NI Social Protection 2011 2017 19.5 LIR: S P123447 NI Rural Roads Infrastructure 2012 2018 35.0 LIR: S Imp. P126357 NI 2nd Support to the 2012 2018 25.0 LIR: MS Education Sector P129264 NI (AF) Rural Telecom 2012 2015 5.0 Total On-Going 390.4 Source: WB Business Intelligence 12/22/2017 Annex Table 3: Advisory Services and Analytics Deliveries for Nicaragua, FY13-17 World Bank Fiscal Proj ID Economic and Sector Work Report Type Global Practice year P123253 NI CEM MFM FY13 Country Economic Memorandum (CEM) NI Agriculture Public Expenditure P127573 Governance FY13 Public Expenditure Review (PER) Review Public Expenditure Financial P146093 NI PEFA Nicaragua Governance FY16 Accountability P152101 Const. & Opport. Analysis in Ag Sector Agriculture FY16 Sector or Thematic Study/Note World Bank Fiscal Proj ID Non-Lending Technical Assistance Output Type Global Practice year P144535 NI - (JIT) GASFP Agriculture FY13 Technical Assistance Nicaragua #10136 Consumer Protection Finance & P126916 FY14 Technical Assistance Pro Markets Finance & P144344 Nicaragua #10213 Payment Systems FY14 Technical Assistance Markets Finance & P144945 AML/CFT TA to Nicaragua FY14 Technical Assistance Markets P132169 Creating Sustainable SanitanitaServices Water FY15 Technical Assistance Trade & P147229* Doing Business FY15 Technical Assistance Competitiveness Nicaragua#A037 Streng. Sup. of Finance & P149357 FY16 Technical Assistance Microfin Markets CMC: Nicaragua Debt Management P157750 MFM FY16 Technical Assistance Reform Plan Source: WB Business Intelligence 12/14/2017 Note: *Refers to a regional (Central America) Technical Assistance project Annexes CLR Review 28 Independent Evaluation Group Annex Table 4: Nicaragua Grants and Trust Funds Active in FY13-17 Trust Approved IEG Project Approval Closing Project Name Fund Amount Outcome ID FY FY ID (US$ M) Rating P094154 Precious Woods Project TF 56528 2006 2019 0.79 Grant for Alternative Indigenous and Afro-Des. Agrof. Project TF 93115 2009 2013 1.99 P115882 in Nicaragua Nicaragua Food Emergency Support Program for School TF 97212 2011 2013 2.97 P122181 Children P087046 Second Agricultural Technology Project TF 99911 2011 2013 2.05 IEG: MS Improving Community and Family Health Care Services TF 97259 2011 2013 0.40 IEG: S P106870 Project Drought-Hardy "Food Forests" to Help Miskito Children TF 97650 2011 2013 0.20 P121135 Weather the Storm P120657 Nicaragua FCPF REDD Readiness TF 99264 2012 2018 3.80 P121779 Nicaragua Social Protection TF 10216 2012 2013 2.75 Investment Phase under the Caribbean Coast Development TF 99797 2012 2014 2.47 P126788 Program Save the Children - Grant Investment Phase under the TF 99791 2012 2014 1.20 P126812 Caribbean Coast Development Program Investment Phase under the Caribbean Coast Development TF 10432 2012 2014 0.85 P126788 Program Investment Phase under the Caribbean Coast Development TF 11097 2012 2014 0.85 P126788 Program P133557 Education Sector Strategy Support Project TF 13232 2013 2018 16.70 LIR:S P133557 Education Sector Strategy Support Project TF 13410 2013 2018 6.00 LIR:MU P111795 NI Public Financial Management Modernization Project TF 14059 2013 2016 3.35 P144462 Reducing the Vulnerability of Small Farmers to Price Risk TF 14338 2013 2016 1.00 Nicaragua Strengthening Investment & Export TF 12322 2013 2016 0.24 P131210 Promotion P133557 Education Sector Strategy Support Project TF 15143 2014 2018 34.75 LIR:S P144415 Strengthening Institutional Capacity of GRAAN TF 14561 2014 2017 0.60 P148809 NI Caribbean Coast Food Security Project TF 18703 2015 2020 33.90 LIR:S P161359 Improving Quality and Efficiency of Public Sector Audit TF A4518 2017 2018 0.50 Total 117.36 Source: Client Connection as of 12/18/17 IEG Validates RETF that are 5M and above Annexes CLR Review 29 Independent Evaluation Group Annex Table 5: IEG Project Ratings for Nicaragua, FY13-17 Total IEG Risk to Exit Project ID Project Name Evaluated IEG Outcome Rating Development FY ($M) Outcome Rating 2013 P056018 NI Land Administration Project 48.1 Satisfactory Moderate 2013 P077826 NI Broad-Based Access to Finan Services 5.5 Moderately Satisfactory Moderate 2014 P087046 NI 2nd Agricultural Technology Project 22.0 Moderately Satisfactory Significant 2015 P083952 NI (CRL) Roads Rehab & Maintenance IV 101.0 Satisfactory Moderate 2015 P106283 NI Rural Water Supply and Sanitation 23.3 Satisfactory Significant 2015 P108974 NI Hurricane Felix Emergency Recovery 14.6 Unsatisfactory High 2015 P109691 NI Micro, Small & Medium Enterprise Dev. 12.2 Satisfactory Negligible To Low 2015 P110092 NI Greater Managua Water and Sanitation 39.4 Moderately Satisfactory High 2016 P106870 NI Comm. and Family Health Care Services 30.8 Satisfactory Low Total 296.8 Source: Business Intelligence Key IEG Ratings as of 12/14/2017 Annex Table 6: IEG Project Ratings for Nicaragua and comparators, FY13-17 Total Total RDO % RDO % Outcome Outcome Region Evaluated1 Evaluated Moderate or Lower Moderate or Lower % Sat ($) % Sat (No) ($M) (No) Sat ($) Sat (No) Nicaragua 296.8 9 95 89 56 44 LCR 24,828.7 208 85 70 57 52 World 92,475.8 1,080 85 72 56 45 Source: Business Intelligence as of 12/14/17 1)The total evaluated amount is understated because it does not include the net commitments of trust funded projects evaluated by IEG. * Refer to Annex Table 5 for IEG project ratings. Annexes CLR Review 30 Independent Evaluation Group Annex Table 7: Portfolio Status for Nicaragua and Comparators Average Fiscal Year 2013 2014 2015 2016 2017 FY13-17 Nicaragua # Proj 18 18 13 10 13 14 # Proj At Risk - 1 1 1 2 1 % Proj At Risk 6 8 10 15 10 Net Comm Amt 398 507 420 385 561 454 Comm At Risk - 16 50 6 36 27 % Commit at Risk - 3 12 2 6 6 LCR # Proj 332 315 291 259 260 291 # Proj At Risk 72 70 68 63 67 68 % Proj At Risk 22 22 23 24 26 23 Net Comm Amt 30,843 29,271 27,713 29,360 28,925 29,222 Comm At Risk 6,097 6,356 5,866 5,535 5,223 5,816 % Commit at Risk 20 22 21 19 18 20 World # Proj 1,964 2,048 2,022 1,975 2,072 2,016 # Proj At Risk 414 412 444 422 449 428 % Proj At Risk 21 20 22 21 22 21 Net Comm Amt 176,203 192,610 201,045 220,332 224,459 202,930 Comm At Risk 40,806 40,934 45,988 44,245 52,549 44,904 % Commit at Risk 23 21 23 20 23 22 Source: Business Intelligence as of 12/14/17 Note: Includes both IBRD/IDA projects and Trust Fund grants. Annex Table 8: Disbursement ratio for Nicaragua and Comparators, FY13-17 Overall Fiscal Year 2013 2014 2015 2016 2017 Result Nicaragua Disbursement Ratio (%)* 27 41 34 33 44 35 Inv Disb in FY 45 70 59 64 56 295 Inv Tot Undisb Begin FY 166 173 175 194 128 835 LCR Disbursement Ratio (%)* 24 19 20 21 21 21 Inv Disb in FY 3,421 2,414 2,457 2,588 2,687 13,567 Inv Tot Undisb Begin FY 14,385 12,991 12,076 12,429 12,608 64,490 World Disbursement Ratio (%)* 20 20 21 19 20 20 Inv Disb in FY 19,050 19,414 20,318 19,401 20,572 98,755 Inv Tot Undisb Begin FY 96,039 96,255 95,816 103,447 103,733 495,289 * Calculated as IBRD/IDA disbursements made in FY/Opening Undisbursed amount at FY. Restricted to Investment Lending instrument type. Source: Business Intelligence database as of 12/14/2017 Annexes CLR Review 31 Independent Evaluation Group Annex Table 9: Net Disbursement and Charges for Nicaragua (US$ M), FY13-17 Period Disb. Amt. Repay Amt. Net Amt. Charges Fees Net Transfer FY13 45.0 3.5 41.4 0.0 3.6 37.8 FY14 70.1 4.5 65.7 0.0 3.9 61.8 FY15 59.0 5.6 53.4 0.0 3.9 49.5 FY16 68.7 5.9 62.8 0.0 4.0 58.8 FY17 57.6 7.3 50.2 0.0 4.3 46.0 Report Total 300.4 26.8 273.6 0.0 19.7 253.9 Source: World Bank Client connection as of 12/22/2017 Annex Table 10: Total Net Disbursements of Official Development Assistance Development Partner 2013 2014 2015 Australia 0.9 0.14 0.23 Austria 4.08 2.34 1.85 Belgium 3.78 2.8 2.15 Canada 13.63 12.5 13.91 Czech Republic 0.01 0.01 0.01 Denmark -24.87 0.56 0.37 Finland 4 1.61 1.84 France 0.92 1.02 0.71 Germany 16.21 17.69 11.65 Greece 0.01 0.01 0.01 Iceland 0.08 - - Ireland 1.59 1.66 1.38 Italy 0.68 0.66 1.06 Japan 19.12 13.11 16.47 Korea 6.63 19.2 10.43 Luxembourg 15.39 11.78 7.82 Netherlands 5.93 0 - Norway 18.31 11.51 7.1 Poland - - 0.01 Portugal 0.04 0.05 0.01 Spain 27.54 14.99 9.18 Sweden 1.99 3.02 1.99 Switzerland 24.09 18.05 21.15 United Kingdom 0.08 0.12 0.24 United States 39.26 25.68 40.94 DAC Countries, Total 179.4 158.52 150.51 Russia 36.4 17.24 4.56 Turkey 0.01 - - Non-DAC Countries, Total 36.41 17.24 4.56 Annexes CLR Review 32 Independent Evaluation Group Development Partner 2013 2014 2015 EU Institutions 61.41 34.69 47.98 International Monetary Fund, Total -16.32 -21.91 -26.83 IMF (Concessional Trust Funds) -16.32 -21.91 -26.83 Regional Development Banks, Total 151.89 163.17 190.62 Inter-American Development Bank, Total 151.89 163.17 190.62 IDB Special Fund 151.89 163.17 190.62 United Nations, Total 8.95 12.7 9.19 Food and Agriculture Organisation [FAO] 0.85 - - International Atomic Energy Agency [IAEA] 0.73 0.51 0.17 IFAD 2.84 6.96 4.43 International Labour Organization [ILO] 0.32 0.22 0.36 UNAIDS - - 0.01 UNDP 1.57 1.76 1.47 UNFPA 1.38 1.41 1.27 UNICEF 1.08 1.07 1.37 WFP 0.19 0.78 0.1 World Bank Group, Total 60.76 47.8 61.44 World Bank, Total 60.76 47.8 61.44 International Bank for Reconstruction and Development [IBRD] - - - International Development Association [IDA] 60.76 47.8 61.44 Other Multilateral, Total 13.29 18.6 16.65 Global Alliance for Vaccines and Immunization [GAVI] 4.78 4.36 2.62 Global Environment Facility [GEF] 2.08 3.63 3.55 Global Fund 7.45 7.21 5.06 Nordic Development Fund [NDF] -0.03 1.24 0.89 OPEC Fund for International Development [OFID] -1 2.16 4.53 Multilateral Agencies, Total 280.0 255.1 299.1 Development Partners, Total 495.8 430.8 454.1 Source: OECD Stat database as of 12/22/2017 2016 data not yet available. Annexes CLR Review 33 Independent Evaluation Group Annex Table 11: Economic and Social indicators for Nicaragua, 2013-2016 Nicaragua LCR World Series Name 2013 2014 2015 2016 Average 2013-2016 Growth and Inflation GDP growth (annual %) 4.9 4.8 4.9 4.7 4.8 0.8 2.7 GDP per capita growth (annual %) 3.7 3.6 3.7 3.5 3.6 -0.3 1.4 GNI per capita, PPP (current international $) 4,640 4,910 5,140 5,390 5,020.0 14,935.3 15,403.0 GNI per capita, Atlas method (current US$) 1,810 1,890 1,960 2,050 1,927.5 9,298.5 10,653.6 Inflation, consumer prices (annual %) 7.1 6.0 4.0 3.5 5.2 2.8 2.1 Composition of GDP (%) Agriculture, value added (% of GDP) 18.3 18.5 18.2 17.3 18.1 5.4 3.9 Industry, value added (% of GDP) 28.1 27.8 27.2 26.8 27.5 28.5 27.7 Services, etc., value added (% of GDP) 53.6 53.7 54.6 55.9 54.5 66.1 68.4 Gross fixed capital formation (% of GDP) 28.7 27.7 30.1 .. 28.9 20.2 23.5 External Accounts Exports of goods and services (% of GDP) 45.2 45.0 40.0 39.0 42.3 20.9 30.0 Imports of goods and services (% of GDP) 65.8 61.7 58.2 57.0 60.7 22.7 29.4 Current account balance (% of GDP) -10.9 -7.1 -9.0 -8.6 -8.9 External debt stocks (% of GNI) 91.1 87.7 85.0 85.4 87.3 Total debt service (% of GNI) 6.0 6.1 6.5 6.4 6.3 4.5 Total reserves in months of imports 3.2 3.6 3.8 3.7 3.6 9.7 13.4 Fiscal Accounts1 General government revenue (% of GDP) 23.5 23.3 23.9 25.2 24.0 27.8 General government total expenditure (% of GDP) 24.2 24.5 25.3 26.8 25.2 33.1 General government net lending/borrowing (% of -0.7 -1.2 -1.4 -1.6 -1.2 -5.3 GDP) General government gross debt (% of GDP) 28.8 28.7 28.9 31.0 29.4 53.1 Health Life expectancy at birth, total (years) 74.5 74.8 75.0 .. 74.8 75.1 71.7 Immunization, DPT (% of children ages 12-23 98.0 98.0 98.0 98.0 98.0 89.5 85.3 months) Improved sanitation facilities (% of population with 67.8 67.8 67.9 .. 67.8 82.9 67.0 access) Improved water source (% of population with 86.8 86.9 87.0 .. 86.9 94.5 90.5 access) Mortality rate, infant (per 1,000 live births) 18.6 17.9 17.3 16.8 17.7 15.6 32.0 Education School enrollment, preprimary (% gross) .. .. .. .. 76.0 47.4 School enrollment, primary (% gross) .. .. .. .. 108.6 104.7 School enrollment, secondary (% gross) .. .. .. .. 93.8 76.1 School enrollment, tertiary (% gross) .. .. .. .. 44.6 34.5 Population Population, total (millions) 5.9 6.0 6.1 6.1 6.0 627.6 7,312.3 Population growth (annual %) 1.2 1.1 1.1 1.1 1.1 1.1 1.2 Population, female (% of total) 50.7 50.7 50.7 50.7 50.7 50.6 49.6 Urban population (% of total) 58.1 58.5 58.8 59.1 58.6 79.7 53.6 Source: World Development Indicators database as of 12/14/2017 1) Data from the IMF's World Economic Outlook Database, April 2017. 2016 data are estimates Annexes CLR Review 34 Independent Evaluation Group Annex Table 12: List of IFC Investments in Nicaragua Investments Committed in FY13-FY17 Project Cmt Project Greenfield Original Original Original Loan Equity Net Net Primary Sector Name Project Size Net Comm ID FY Status Code Loan Equity CMT Cancel Cancel Loan Equity 38658 2017 Active Finance & Insurance G 30,000 30,000 - 30,000 - - 30,000 - 30,000 Construction and Real 39044 2017 Active E 13,000 13,000 - 13,000 - - 13,000 - 13,000 Estate 38463 2016 Active Oil, Gas and Mining E 403 - 404 404 - 57 404 347 347 32519 2015 Active Oil, Gas and Mining G 10,000 - 5,679 5,679 - - 5,679 5,679 5,679 33779 2015 Active Health Care E 4,350 4,350 - 4,350 - - 4,350 - 4,350 33969 2015 Closed Agriculture and Forestry E 30,000 12,000 - 12,000 - - 12,000 - 12,000 28799 2014 Active Finance & Insurance E 7,000 5,000 - 5,000 - - 5,000 - 5,000 32383 2014 Closed Agriculture and Forestry G 17,600 4,500 - 4,500 4,500 - - - - 34131 2014 Active Finance & Insurance G 15,000 3,750 - 3,750 - - 3,750 - 3,750 32253 2013 Active Food & Beverages E 15,000 15,000 - 15,000 - - 15,000 - 15,000 Sub-Total 142,353 87,600 6,084 93,684 4,500 57 89,184 6,026 89,126 Investments Committed pre-FY13 but active during FY13-17 Project CMT Project Greenfield Original Original Original Loan Equity Net Net Primary Sector Name Project Size Net Comm ID FY Status Code Loan Equity CMT Cancel Cancel Loan Equity 27676 2011 Active Electric Power G 409,000 50,300 - 50,300 - - 50,300 - 50,300 29570 2011 Active Finance & Insurance E 10,000 133,087 - 133,087 - - 133,087 - 133,087 28207 2010 Active Finance & Insurance E 15,000 114,454 - 114,454 - - 114,454 - 114,454 26819 2009 Active Agriculture and Forestry G 52,000 25,000 - 25,000 - - 25,000 - 25,000 27968 2009 Active Finance & Insurance E 5,000 43,470 - 43,470 - - 43,470 - 43,470 26287 2008 Active Finance & Insurance E 20,000 203,358 - 203,358 - - 203,358 - 203,358 26820 2008 Active Health Care G 25,861 11,000 - 11,000 4,500 - 6,500 - 6,500 25331 2007 Active Agriculture and Forestry E 62,000 25,000 - 25,000 - - 25,000 - 25,000 Sub-Total 598,861 605,668 - 605,668 4,500 - 601,168 - 601,168 TOTAL 741,214 693,268 6,084 699,352 9,000 57 690,352 6,026 690,295 Source: IFC-MIS Extract as of 8/30/17 Annexes CLR Review 35 Independent Evaluation Group Annex Table 13: List of IFC Advisory Services in Nicaragua Advisory Services Approved in FY13-17 Impl Impl Primary Project Project Total Funds, Project Name Start End Business ID Status US$ FY FY Line 598187 LAC - IDA, C3P Business Development 2017 2017 ACTIVE CAS 560,371 600900 FDL Alternative Delivery Channels 2016 2017 ACTIVE FIG 115,925 600532 Nicaragua MLR Forestal 2015 2015 ACTIVE MAS 54,417 600321 Coffee Renovation Response 1 - Ecom 2014 2018 ACTIVE MAS 747,529 595727 Cocoa Rehabilitation Mesoamerica 2013 2015 ACTIVE MAS 573,404 599518 FUNDESER RM MF 2013 2014 ACTIVE FIG 137,936 Sub-Total 2,189,582 Advisory Services Approved pre-FY13 but active during FY13-17 Impl Impl Primary Project Total Funds, Project Name Start End Project Status Business ID US$ FY FY Line 580708 Ecom Renovation - Nicaragua 2011 2013 CLOSED SBA 434,831 Building SMG's Sustainable Wood Supply 575307 2010 2013 TERMINATED SBA 670,083 through Community Forest Management Building competitiveness for CISA coffee 576087 farms in Nicaragua through productivity and 2010 2013 TERMINATED SBA 620,000 sustainability 577387 Ecom Renovation 2010 2013 CLOSED SBA 760,000 Sub-Total 2,484,914 TOTAL 4,674,496 Source: IFC AS Data as of 10/15/17 Annexes CLR Review 36 Independent Evaluation Group Annex Table 14: IFC net commitment activity in Nicaragua, FY13 - FY17 2013 2014 2015 2016 2017 Total Financial 8,750,000 30,000,000 38,750,000 Markets Trade Finance 53,430,897 69,518,562 73,911,372 104,748,310 125,477,785 427,086,926 (TF) Primary Agribusiness & Production & 15,000,000 15,000,000 Forestry Commodity Processing Packaged Food 4,500,000 7,500,000 12,000,000 & Beverages Forest & Wood (700,000) (700,000) Products Tourism, Retail, Property Construction & (Construction & 13,000,000 13,000,000 Real Estates Real Estate) (TRP) Health, Education, Life Health 4,350,000 4,350,000 Sciences Oil, Gas & Mining 5,616,211 350,282 5,966,493 Mining Infrastructure Electric Power (1,571,338) (1,571,338) Total 68,430,897 82,768,562 91,377,582 103,527,254 167,777,785 513,882,081 Source: IFC MIS as of 10/20/17 Annex Table 15: List of MIGA Activities in Nicaragua, 2013-2017 Project Max Gross ID Contract Enterprise FY Sector Investor Status Issuance 10120 EcoPlanet Bamboo Nicaragua - Expansion 2015 Not Active Agribusiness United States 22 11683 Industria Cerámica Centroamericana S.A. 2015 Active Manufacturing Barbados 11 10120 EcoPlanet Bamboo 2013 Not Active Agribusiness United States 27 10994 Eolo Wind Farm 2013 Active Power Bermuda 16 ProCredit Group Central Bank Mandatory 9196 2011 Active Banking Germany 13 Reserves Coverage Total 89 Source: MIGA 10/23/17