The World Bank Afghanistan Technical Assistance Facility (P157035) REPORT NO.: RES35406 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF AFGHANISTAN TECHNICAL ASSISTANCE FACILITY APPROVED ON JUNE 28, 2016 TO ISLAMIC REPUBLIC OF AFGHANISTAN GOVERNANCE SOUTH ASIA Regional Vice President: Hartwig Schafer Country Director: Shubham Chaudhuri Senior Global Practice Director: Deborah L. Wetzel Practice Manager/Manager: Ismaila B. Ceesay Task Team Leader: Yousif Mubarak Elmahdi, Atiqullah Ahmadzai The World Bank Afghanistan Technical Assistance Facility (P157035) I. BASIC DATA Product Information Project ID Financing Instrument P157035 Investment Project Financing Original EA Category Current EA Category Not Required (C) Not Required (C) Approval Date Current Closing Date 28-Jun-2016 30-Jun-2020 Organizations Borrower Responsible Agency Islamic Republic of Afghanistan Ministry of Finance Project Development Objective (PDO) Original PDO The development objective is to strengthen the fiscal management and the budget planning performance of the Government of Afghanistan. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed TF-A2839 28-Jun-2016 18-Jul-2016 18-Jul-2016 30-Jun-2020 5.00 1.25 3.75 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No II. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The World Bank Afghanistan Technical Assistance Facility (P157035) This Restructuring Paper (RP) seeks the approval of the World Bank Country Director for the proposed restructuring of the Afghanistan Technical Assistance Facility (TAF). This restructuring proposal is in response to the request from the Government of the Islamic Republic of Afghanistan (GoIRA) through a letter dated September 1, 2018. The following changes to the project were requested by the Government: (a) Early closure of the project, from June 30, 2020 to January 10, 2019; and (b) Cancellation of undisbursed balance of US$3,747,218.80. The proposed restructuring follows roll-over of all TAF activities into the larger all-of-MoF Fiscal Performance Improvement Support Project (FSP), reflecting GoIRA's desire to expand, consolidate, and better coordinate external support to the Ministry of Finance (MoF), in line with its Fiscal Performance Improvement Plan (FPIP), within one single instrument. The TAF was approved by the Afghanistan Reconstruction Trust Fund (ARTF) Management Committee on June 28, 2016. TAF was designed to support reform planning in MoF as guided by the FPIP. The project has made strong progress in this regard. This is reflected in the project’s performance which was rated as Satisfactory (S) for both Project Development Objectives (PDO) and Implementation Progress (IP) in the latest Implementation Status and Results (ISR) report (archived on June 21, 2018). TAF has disbursed a total of US$1,252,781.21; equivalent to about 25 percent of the ARTF grant amount (US$5 million) approved for the project. To date, TAF has made important contributions to both revenue and expenditure management. Critically, the project supported development of a Fiscal Strategy Paper (an annual pre-budget report setting out the macro-fiscal and policy situation), and has guided reforms in pension policy. Through TAF, the establishment and operations of the High Economic Council (HEC) chaired by the President of the Islamic Republic of Afghanistan, has been facilitated. The project has been integral to improving the alignment of strategic plans and medium term budgets - through technical assistance to the finalization of Dari, Pashto and English versions of the ANPDF and direct contributions to the development of costed sector strategies. TAF has provided technical inputs towards the development of National Priority Programs (NPPs) across eleven (11) thematic areas, including the Women’s Economic Empowerment NPP that was launched to coincide with International Women’s Day. Moving forward, the FSP which became effective on January 1, 2018, will continue and expand upon the high priority macro fiscal policy management and budget planning reforms initiated through TAF, whilst providing holistic support across the FPIP. This includes consolidating core Public Financial Management (PFM) functions, enhancing revenue administration, and upgrading capacity across MoF’s corporate and shared services. Building on the experience of TAF, the FSP is being carried out directly by core MoF functions using country systems, and without the support of a dedicated Project Implementation Unit (PIU). III. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications TF-A2839 Effective 30-Jun-2020 10-Jan-2019 10-Jan-2019 The World Bank Afghanistan Technical Assistance Facility (P157035)