PROJECT INFORMATION DOCUMENT (PID) ADDITIONAL FINANCING Report No.: PIDA4001 Project Name Additional Financing for Science & Technology Higher Education (P149464) Parent Project Name Science & Technology Higher Education (P098496) Region AFRICA Country Tanzania Sector(s) Tertiary education (100%) Theme(s) Education for the knowledge economy (100%) Lending Instrument Investment Project Financing Project ID P149464 Parent Project ID P098496 Borrower(s) Ministry of Finance and Economic Affairs on behalf of the United Republic of Tanzania Implementing Agency Ministry of Education and Vocational Training Environmental Category B-Partial Assessment Date PID Prepared/Updated 08-May-2014 Date PID Approved/Disclosed 09-May-2014 Estimated Date of Appraisal 08-May-2014 Completion Estimated Date of Board 10-Jul-2014 Approval Decision The Chair authorized the team to proceed with appraisal and preparation of the negotiations package, subject to addressing the comments provided in the Decision Meeting Decision Note held on April 3, 2014. I. Project Context Country Context Tanzania’s economy has experienced near 7% annual GDP growth for the past decade and makes it one of the fastest growing economies in the world. This remarkable growth is achieved with the country’s consistent macroeconomic policies and a relatively stable political environment as well as with the Tanzania Development Vision (TDV 2025) which sets up the ambitious goal to transform the nation into a middle income country (MIC) by 2025. Initiatives such as new Special Economic Zones, the Southern Agriculture Corridor Projects, and the discovery of natural gas reserves provide promising sources for future growth. The new “Big Results Now” (BRN) initiative launched by the Government of Tanzania (GoT) in 2013 for pursuing focused development and greater impact in six priority areas - agriculture, education, energy, transportation, water and resource mobilization, provides a favorable environment for getting results. Detailed 5-year Page 1 of 5 development plan from each sector including education has been developed, implemented and updated to support the realization of TDV 2025. However, Tanzania still faces huge challenges to achieve its MIC dream. One of the biggest challenges is education and skills development. Only 3% of Tanzanian working population is classified as high-skilled while the majority 84% is low-skilled. The shortage of skilled workers is a fundamental constraint to the competitiveness of Tanzanian industries, including attracting FDI. Without adequate human capital development and available skills, Tanzania will not be able to sustain its development, achieve a faster and more balanced growth, and realize its MIC dream. Large investments in tertiary education are necessary to raise Tanzania’s skill level to that of its comparators. Sectoral and institutional Context Derived from the operational frameworks of TDV 2025, the Education Sector Development Program (ESDP, 2008-2017) provides a complementary strategic plan that guides the education sector to produce the human resources needed for realizing the country’s vision. Two sub-sector specific development plans have provided guidance for reforms in tertiary education – the Higher Education Development Program (HEDP, 2010-2015) and the Technical and Vocational Education and Training (TVET) Development Program (TVETDP, 2013/2014-2017/2018). In recent years, there has been great development in Tanzania’s tertiary education. The enrollment in higher education has more than doubled and the enrollment in technical colleges has increased more than three times. Many private institutions have mushroomed, counting for almost two-thirds of the tertiary education institutions in the country. However, even with such achievement, the provision of tertiary education and training is still unable to meet the increasing demand of the labor market. Tanzania needs to double its medium-skilled and quadruple its high-skilled working population in order to achieve the MIC status. The severer shortage of post-secondary graduates persists in the country. For example, Tanzania needs 26,998 secondary school science teachers immediately but the tertiary education institutions in the country can only produce 2,300 science teacher candidates annually. At the same time, even with high demand for skilled workers in the country, some university and college graduates are still unable to find jobs. Quality and relevance of tertiary education are under scrutiny. The challenges facing tertiary education institutions are huge, e.g., increased magnitude and complexity of unmet skills demand; weak market relevance; low efficiency; unsatisfactory quality; lack of equitable access; constrained public funding; fragmented financing mechanisms and institutional arrangements, etc. Many efforts and initiatives have been carried out to address these issues in collaboration with development partners and the private sector under the leadership of the Ministry of Education and Vocational Training (MoEVT). The MoEVT has been implementing the first phase of the Science and Technology Higher Education Program (STHEP-1) supported by the World Bank in the past five years. The Project is a large public investment for higher education in the country. It has focused on increasing the quantity and quality of higher education graduates, with special emphasis on science, technology, and education, and has achieved remarkable results, e.g., 8,300 students enrolled in science and technology (S&T) programs, 1,600 new PhD and MScs holding lecturers in priority disciplines, 180 new courses in S&T disciplines launched; improved student loans recovery from 5.6% in 2007 to 55% at present; and reduced student application cost from US$600 to US$20 through the newly established online Central Admissions System. With such successful results, the GoT would like to continue its reform effort in tertiary education. There Page 2 of 5 is a great consensus among stakeholders that a strategy and operational plan for human capital and skills development for the country’s economic transformation, especially in growth areas, is urgently needed. II. Proposed Development Objectives A. Current Project Development Objectives – Parent The Project Development Objective is to increase the quantity and quality of higher education graduates, with special emphasis onscience, technology, and education, through an improved learning environment. B. Proposed Project Development Objectives – Additional Financing (AF) (i) To increase quantity and quality of higher education graduates, with special emphasis on science, technology and education, and (ii) to lay the foundations for improved responsiveness of tertiary education to the labor market. III. Project Description Component Name Component 1A – Investments in Priority Disciplines for Economic Growth (US$3.71 million) (Part A.1 under the Credit Agreement). Comments (optional) The additional Credit will finance the completion of existing activities in the areas of staff training, remaining external works and civil works, lab equipment, and other goods. No new activities are planned under this sub-component. Component Name Component 1B – Expanded Capacity for Teacher Preparation and for Graduate Studies in Education (US$5.658 million) (Part A.2 under the Credit Agreement). Comments (optional) US$0.978M of the additional Credit will finance the completion of existing activities under this sub- component in the areas of staff training, remaining external works and civil works, lab equipment, and furniture. US$4.68M of the additional Credit will finance a new activity – to build institutional mechanisms and capacity for applying information and communications technology (ICT) in teacher training with the introduction of a pilot training program that upgrades the content knowledge of science teachers in difficult subject areas. Component Name Component 2A – Strengthening Key Tertiary Education Agencies and Institutions (US$4.632 million) (Part B.1 under the Credit Agreement). Comments (optional) US$0.682M of the additional Credit will finance the completion of existing activities under this sub- component in the areas of consultancy services and STHEP-1 operational costs. US$3.95M of the additional Credit will finance two new activities: (i) to establish institutional mechanisms and procedures for the Flexible Financing Facility developed under the original Credit and is a performance-based financing instrument for fostering greater linkages between higher education institutions and the private sector (US$2.32M); and (ii) to develop a strategy and operational plan for skills development from the technical/vocational level to higher education in the priority growth sectors of agribusiness, tourism, and transport/logistics, in close collaboration with the private sector (US$1.63M.) Component Name Page 3 of 5 Component 2B – Investments in System-wide ICT and Libraries (US$ 1.0 million) (Part B.2 under the Credit Agreement). Comments (optional) The additional Credit will finance the completion of the existing activity – Last Mile Connectivity – to connect the remaining eight higher education institutions with the National ICT Broadband Backbone. No new activities are planned under this sub-component. IV. Financing (in USD Million) Total Project Cost: 15.00 Total Bank Financing: 15.00 Financing Gap: 0.00 For Loans/Credits/Others Amount BORROWER/RECIPIENT 0.00 International Development Association (IDA) 15.00 Total 15.00 V. Implementation The institutional and implementation arrangements that were used for the implementation of STHEP-1 will remain the same for the implementation of the proposed AF. These arrangements involve MoEVT overseeing the project on behalf of the GoT. At the start of the implementation, each of the implementing institutions will enter into a contract with the Education Permanent Secretary, detailing the specific activities to be undertaken and the corresponding budget to be allocated. MoEVT will then supervise all stages of the activities and disburse the agreed allocation upon satisfactory implementation and reporting. The IDA/IBRD guidelines for procurement and finance management as well as social and environmental safeguards will be applied. VI. Safeguard Policies (including public consultation) Safeguard Policies Triggered by the Project Yes No Environmental Assessment OP/BP 4.01 ✖ Natural Habitats OP/BP 4.04 ✖ Forests OP/BP 4.36 ✖ Pest Management OP 4.09 ✖ Physical Cultural Resources OP/BP 4.11 ✖ Indigenous Peoples OP/BP 4.10 ✖ Involuntary Resettlement OP/BP 4.12 ✖ Safety of Dams OP/BP 4.37 ✖ Projects on International Waterways OP/BP 7.50 ✖ Projects in Disputed Areas OP/BP 7.60 ✖ Comments (optional) VII. Contact point World Bank Contact: Xiaonan Cao Page 4 of 5 Title: Senior Education Specialist Tel: 473-8917 Email: xcao@worldbank.org Borrower/Client/Recipient Name: Ministry of Finance and Economic Affairs on behalf of the United Republic of Tanzania Contact: Saada Mkuya Salum Title: Minister of Finance Tel: 255-22-2111174 Email: Implementing Agencies Name: Ministry of Education and Vocational Training Contact: Sifuni Ernest Mchome Title: Permanent Secretary Tel: (255-22) 211-3139 Email: sifunimchome@gmail.com VIII. For more information contact: The InfoShop The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 458-4500 Fax: (202) 522-1500 Web: http://www.worldbank.org/infoshop Page 5 of 5