Document of The World Bank Report No: 71638-JM RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF JAMAICA SECOND HIV/AIDS PROJECT LOAN APPROVED BY THE BOARD ON MAY 13, 2008 TO JAMAICA OCTOBER 15, 2012 1 DATA SHEET TEMPLATE FOR PROJECT PAPER JAMAICA: SECOND HIV/AIDS PREVENTION AND CONTROL PROJECT (Loan No. IBRD 7556) Restructuring Status: Draft Restructuring Type: Level two Last modified on date : 10/15/2012 1. Basic Information Project ID & Name P106622: JM Second HIV/AIDS Project Country Jamaica Task Team Leader Shiyan Chao Sector Manager/Director Joana Godinho Country Director Françoise Clottes Original Board Approval Date 05/13/2008 Original Closing Date: 11/30/2012 Current Closing Date 11/30/2012 Proposed Closing Date [if applicable] 03/31/2013 EA Category B-Partial Assessment Revised EA Category B-Partial Assessment-Partial Assessment EA Completion Date 07/01/2007 Revised EA Completion Date 2. Revised Financing Plan (US$m) Source Original Revised BORR 1.54 1.54 IBRD 10.00 10.00 Total 11.54 11.54 3. Borrower Organization Department Location Jamaica Jamaica 4. Implementing Agency Organization Department Location Ministry of Health Jamaica 5. Disbursement Estimates (US$m) Actual amount disbursed as of 09/11/2012 7.09 Fiscal Year Annual Cumulative 2012 0.00 7.09 2013 2.91 10.00 Total 10.00 2 6. Policy Exceptions and Safeguard Policies Does the restructured project require any exceptions to Bank policies? N Does the restructured project trigger any new safeguard policies? If yes, please select from N the checklist below and update ISDS accordingly before submitting the package. 7a. Project Development Objectives/Outcomes Original/Current Project Development Objectives/Outcomes The project development objectives are to assist in the implementation of the Government’s national HIV/AIDS program through support to: (i) deepening of prevention interventions targeted at high risk groups and for the general population (ii) increasing of access to treatment, care and support services for infected and affected individuals; (iii) strengthening of program management and analysis to identify priorities for strengthening the health sector capacity to respond to the HIV/AIDS epidemic and other priority health problems. 7b. Revised Project Development Objectives/Outcomes [if applicable] Regional Vice President: Hasan A. Tuluy Country Director: Françoise Clottes Sector Manager / Director: Joana Godinho Task Team Leader: Shiyan Chao 3 JAMAICA JAMAICA SECOND HIV/AIDS PROJECT P106622 CONTENTS Page A. SUMMARY ............................................................................................................... 4 B. PROJECT STATUS ................................................................................................. 4 C. PROPOSED CHANGES .......................................................................................... 4 ANNEX 1: REALLOCATION OF PROCEEDS ........................................................... 8 ANNEX 2: PROPOSED ACTION PLAN ..................................................................... 9 4 JAMAICA SECOND HIV/AIDS PROJECT (Loan No. IBRD 7556) PROJECT PAPER A. SUMMARY 1. This Project Paper seeks the approval of the Country Director to introduce three changes in the Legal Agreement for the Jamaica Second HIV/AIDS Project (the Project) (Loan No. IBRD 7556). The proposed changes are to (a) reallocate funds among Project Disbursement Categories; (b) extend the Project Closing Date for four months from November 30, 2012 to March 31, 2013; and (c) provide a four months Grace Period for the Project. The proposed changes will allow the Project to complete the activities that started late due to delayed budget allocation because of the negative impact of the global economic down-turn on the Government’s budget. The reallocation will take into account the actual costs and future needs of Project implementation and the four month Grace Period will allow the project to complete payments after the Project closing. The proposed changes will not change the development objectives or the associated outcome targets. B. PROJECT STATUS 2. The US$10 million Loan Agreement for the Jamaica Second AIDS Project was signed on June 10, 2008 and became effective on September 23, 2008. The Project is a follow-on project to the Jamaica HIV/AIDS Prevention and Control Project, which was successfully completed on May 31, 2008. The Government sought the Bank’s support to finance the implementation of the National HIV/AIDS Strategic Plan for the period 2007- 2012, which is also supported by the Global Fund for AIDS, Tuberculosis and Malaria (GF) and other partners. The Project has successfully supported the implementation of the 2007-2012 National HIV Program (NHP). Increased access to HIV testing and expansion of ART treatment have resulted in a reduction of mother to child transmission and AIDS related mortality. The NHP has made significant progress in reaching most at risk population such as commercial sex workers (CSWs). The percent of CSWs reporting condom use with their most recent client has reached 97 percent, and 75 percent of CSWs who received HIV testing in the last 12 months know their results, surpassing the 50 percent target. The Project has built capacity at the national and regional levels for implementing the NHP. 3. The global financial crisis affected the availability of resources for implementing the Project. To fulfill the requirements/conditions of the GF Grant, the Government used the World Bank loan as the Government’s counterpart financing for the Global Fund grants to finance some staffing cost of the NHP. Therefore, there was no funding allocated for implementing biomedical waste management under Component 4 of the Project. The funding situation improved after 2010. As a result, the implementation as well as disbursement was behind schedule. As of October 15, 2012, US$7.09 million (71%) of the Loan has been disbursed. 5 Overall, the Project is performing well and the Project objectives are achievable. However, the Project is scheduled to close on November 30, 2012 and it still has USS2.91 million undisbursed. C. PROPOSED CHANGES 4. In the letter dated on August 23, 2012, the Government requested to reallocate funds among Expenditure Categories and extend the Project Closing Date by four months. 5. Need for Reallocation of Loan Proceeds. The Loan Proceeds need to be reallocated to reflect the actual costs of activities supported by the Project. Because the World Bank loan is used as the Government’s counterpart fund for the GF Grants to pay for staffing cost, the Project has used more funds under Disbursement Category 3 under Part 3 of the Project. The proposed reallocation is in Table 1 below and the revised Loan proceeds allocation is presented in Annex 1. Table 1: Budget, Actual expenditures and Proposed Reallocation In (‘000 USD) Disbursement Category Original Actual Balance Proposed Amount to be allocation Exp final adjusted March budget 31, 2012 Category 1 3,248 2,052 1,196 2,714 (535) Category 2 1,736 1,198 538 1,647 (89) Category 3 3,046 3,651 (605) 4,562 1,517 Category 4 1,945 19 1,926 1,052 (893) Front-End Fee 25 25 0 25 Total 10,000 6,945 3,055 10,000 0 6. The reallocation will not affect the implementation of the Project and achievement of the Project objectives as Project activities are supported by other funding sources. 7. Extension of the Project Closing Date. The Government requested to extend the Project closing date from November 30, 2012 to March 31, 2013, for the Project to complete two major tasks: the expansion of the Southeast Medical Waste Management Facility (MWMF) and the renovation of the Portland Health Center (PHC). The installation of the major equipment for the MWMF has already completed and the expansion will be completed by December 2012 and the renovation of the PHC is progressing well and will be completed by January 2013. Additional time will also allow the Government to prepare for the transition from the Bank financing to Government financing of the NHP; and salaries of the Project staff will be paid by the Government starting April 1, 2013, the beginning of the Government’s new fiscal year. The Government is confident that with a four-month extension, the loan funds will be fully utilized. This will be the first and only extension for this Project. 6 8. The Government has prepared a specific action plan to be implemented within the extension period (Annex 2). The performance of the Ministry of Health and other implementing agencies is satisfactory. There is no outstanding audit under the Project. 9. Extension of the Project Grace Period. The Disbursement Deadline Date included in the Project’s Disbursement Letter is January 31, 2013, two months after the Project Closing Date. Considering the time needed to process small payments at the different levels with many implementing agencies, the Grace Period will be extended from two months to four months (April 1, 2013 to July 31, 2013). 7 ANNEX 1 Reallocation of Proceeds 1. Proceeds for Jamaica, Jamaica Second HIV/AIDS PROJECT, Ln.7556-JM,, P106622 will be reallocated as follows: Category Revised Amount of the Loan Percentage of Expenditures Allocated to be financed (expressed in USD) (1) Goods, works, 2,714,000 97% consultants’ services, Grants, Training and Operating costs under Part 1 of the Project (2) Goods, works, 1,647,000 95% consultants’ services, Training and Operating costs under Part 2 of the Project (3) Goods, consultants’ 4,562,000 72% services, Training and Operating Costs under Part 3 of the Project (4) Goods, works, 1,052,000 93% consultants’ services, Training and Operating Costs under Part 4 of the Project (5) Front-end Fee 25,000 Amount payable pursuant to Section 2.03 of the Agreement in accordance with Section 2.07 (b) of the General Conditions TOTAL AMOUNT 10,000,000 8 ANNEX 2 Proposed Action Plan 9 10 11 12 13