I3RF Trust Fund Annual Progress Report to Development Partners 2021 Report Release Date: January 31, 2022  CONTACT INFORMATION World Bank Office in Iraq Iraq Reform, Recovery and Reconstruction Fund (I3RF) IRAQ REFORM, RECOVERY AND British Embassy Compound Green Zone, Baghdad Iraq Saroj Kumar Jha, Country Director sjha1@worldbank.org RECONSTRUCTION Ramzi Afif Neman, Head of World Bank Iraq Office FUND I3RF rneman@worldbank.org Naila Ahmed, Program Manager of the I3RF nahmed@worldbank.org Government Partner The I3RF is implemented in partnership with Iraq’s Ministry of Planning: H.E. Dr. Maher Johan, Deputy Minister of Planning maherjohan@yahoo.com Trust Fund Annual Progress Report Dr. Saher Abdul Kadhum Mehdi, Director General to Development Partners 2021 of the Department of International Cooperation intl.cooper@mop.gov.iq Report Release Date: January 31, 2022 I3RF Donors The I3RF is supported by generous contributions from the following donors: THE I3RF AT A GL ANCE 2021  19 Projects with Climate Adaptation and Mitigation Considerations 62 Knowledge Sharing or Learning Activities 28 Allocations as per the 5 28 Endorsed Work Plan Total Contributions Projects Directly/Indirectly Iraqi Government $94.17M $31.5M projects under Contributing to the Nationally Determined Contributions for Iraq Counterparts Involved Bank-Executed (BE) the Fund Paid in $29.23M $58.8M Recipient-Executed To be paid (RE) 18 Bank-Executed activities 14 10 Recipient-Executed activities 4 of these projects include both Projects with Impact $123.40M $90.2M RE and BE components at the National Level 17 $6M Governorates targeted Contributions by Donor Projects contributing to $60.50M Gender Equality and by I3RF Projects Germany Unallocated amount for Women’s Empowerment Technical Assistance Advisory Support Analytics $47.36M UK $10.93M agile I3RF support to new priorities 15 Economic Empowerment of Women and Girls 17 19 Projects 15 Projects 18 Projects Canada Projects including a response 13 Improving Data on Gender $4.61M Sweden $13.30M 8 Improving Laws and Policies a ecting Women to the COVID-19 pandemic out of which 16 are active out of which 14 are active out of which 16 are active Disbursement to date OBJECTIVES Foster socio-economic reform, recovery and reconstruction across a range of sectors through innovative pilot programs and targeted co-investments that complement or improve the e ectiveness of government programs, including IBRD-financed programs; 2 1 2 6 2 2 Support the GoI’s longer-term reform agenda with a focus on economic AREA-BASED SOCIAL WATER AGRICULTURE ENVIRONMENT EDUCATION diversification and private sector-led growth through analytical work, APPROACH FOR PROTECTION capacity building, and technical assistance; RECONSTRUCTION AND JOBS Strengthen the enabling environment and identify practical opportunities for private sector financing of reconstruction in line with the “Maximizing Finance $ PILLAR 1 for Development” (MFD) principles; and, PILLAR 2 Strengthen institutional arrangements to facilitate policy dialogue, 5 4 1 coordination, and monitoring of government reform and reconstruction e orts at national and sub-national levels 32 FINANCIAL PUBLIC FINANCIAL PRIVATE analytical pieces SECTOR MANAGEMENT SECTOR produced in 2021 CROSS-CUTTING OBJECTIVES Integrating a fragility and peacebuilding lens in reconstruction and recovery investments PILLAR 3 3 4 Ensuring programs promote gender equality and community engagement as well as target youth, women, and the most vulnerable populations, including the POVERTY PEACEBUILDING displaced and people with disabilities 2 I3RF ANNUAL REPORT 2021 3  1 Duhok Geographic Coverage 1 of I3RF projects in Iraq 1 Erbil Nineveh Kirkuk Sulaymaniyah NINEVEH 4 active projects 1 • Area-Based Reconstruction in Mosul 3 active projects and Other Urban Centers in Iraq 2 active projects • Support to Manage Environmental 1 Salah El Din 1 active project Pollution Hotspots in Iraq • Fiduciary Oversight and Capacity Strengthening (includes Number of Diyala pipeline projects Strengthening Financial Management and Procurement Capacities; and Baghdad Third Party Monitoring Agent) • Iraq Road Maintenance Anbar 1 1 Microenterprises Grant Project Wasit ANBAR Karbala Babylon 2 • Area-Based Reconstruction in Mosul and Other Urban Centers in Iraq 1 • Support to Manage Environmental Al Quadsya Pollution Hotspots in Iraq 2 • Fiduciary Oversight and Capacity Missan Strengthening (includes 1 Strengthening Financial Management and Procurement Capacities; and ThiQuar Third Party Monitoring Agent) Najaf DIYALA KIRKUK Basra • Area-Based Reconstruction in Mosul • Support to Manage Environmental 2 and Other Urban Centers in Iraq Pollution Hotspots in Iraq • Support to Manage Environmental • Social Protection and Jobs for Poor Pollution Hotspots in Iraq and Vulnerable Iraqis Al Muthana • Fiduciary Oversight and Capacity Strengthening (includes BAGHDAD Strengthening Financial Management • Support to Manage Environmental and Procurement Capacities; and Pollution Hotspots in Iraq Third Party Monitoring Agent) • Water Supply and Sanitation Utility • Iraq Road Maintenance Reform Technical Assistance Microenterprises Grant Project • Social Protection and Jobs for Poor and Vulnerable Iraqis SALAH EL DIN • Fiduciary Oversight and Capacity NATIONAL LEVEL • Area-Based Reconstruction in Mosul Strengthening (includes • Revitalizing the Agriculture Sector and Other Urban Centers in Iraq Strengthening Financial Management in Iraq • Support to Manage Environmental and Procurement Capacities; and • Social Protection and Jobs for Poor Pollution Hotspots in Iraq Third Party Monitoring Agent) and Vulnerable Iraqis • Fiduciary Oversight and Capacity • Support to Education and Skills Strengthening (includes BASRA SULAYMANIYAH Development in Iraq Strengthening Financial Management • Water Supply and Sanitation Utility • Social Protection and Jobs for Poor and Procurement Capacities; and • Support to Tertiary Education in Reform Technical Assistance and Vulnerable Iraqis Iraq Third Party Monitoring Agent) • Technical & Economic Due Diligence • COVID-19 Response and Health • Iraq Road Maintenance to Support Iraq Southern Region NAJAF System Strengthening Microenterprises Grant Project Electricity Network Reinforcements • Social Protection and Jobs for Poor • Strengthening Immunization • Social Protection and Jobs for Poor and Vulnerable Iraqis Systems for Equitable and Quality THIQUAR and Vulnerable Iraqis Delivery of COVID-19 Vaccination • Iraq Road Maintenance • Technical & Economic Due Diligence Microenterprises Grant Project Through Third Party Monitoring to Support Iraq Southern Region MISSAN • Iraq Economic Diversification and Electricity Network Reinforcements Growth ASAs (includes the Reform • Technical & Economic Due Diligence DUHOK • Support for Improved Farm to Support Iraq Southern Region Matrix and White Paper) Management Electricity Network Reinforcements • Fiduciary Oversight and Capacity • Iraq Financial Sector Strengthening (includes • Protecting and Promoting Human • Innovations Towards Learning in Strengthening Financial Management • Analytics and Advisory for Capital in Iraq – An Economic Lagging Iraqi Governorates and Procurement Capacities; and Management of Public Resources Inclusion Pilot (EIP) Third Party Monitoring Agent) and Fiscal Federalism AL MUTHANA • Iraq Road Maintenance • Enabling Environment for Small and BABYLON • Technical & Economic Due Diligence Microenterprises Grant Project Growing Businesses • Support to Manage Environmental to Support Iraq Southern Region • Building Evidence for Policy Making Pollution Hotspots in Iraq Electricity Network Reinforcements AL QUADSYA • Strengthening Peacebuilding, • Support for Improved Farm • Fiduciary Oversight and Capacity Governance and Citizen • Innovations Towards Learning in Engagement in Reform, Recovery Management Strengthening (includes Lagging Iraqi Governorates Strengthening Financial Management and Reconstruction and Procurement Capacities; and • Iraq Road Maintenance ERBIL Microenterprises Grant Project • COVID-19 Adaptation and Recovery Third Party Monitoring Agent) Pilot for MSMEs in Iraq (CARP) • Social Protection and Jobs for Poor • Innovations Towards Learning in • Iraq Household and Socioeconomic and Vulnerable Iraqis Lagging Iraqi Governorates KARBALA Survey (IHSES) III • Support for Improved Farm • Iraq Road Maintenance Management • Iraq Road Maintenance Microenterprises Grant Project Microenterprises Grant Project 4 I3RF ANNUAL REPORT 2021 5 Acknowledgements ACKNOWLEDGEMENTS The Iraq Reform, Recovery and Reconstruction Fund (I3RF) progress report is published annually by the I3RF Secretariat on behalf of the World Bank as the administrator of the Trust Fund. The I3RF Secretariat would like to acknowledge Iraq’s Ministry of Planning, co-chair of the I3RF, and its International Cooperation Department for their collaboration. We would also like to thank the I3RF donors – Canada, Germany, Sweden, and the United Kingdom for their commitment to I3RF’s strategic vision and for their active engagement in the operationalization of the Fund. 6 I3RF ANNUAL REPORT 2021 7 Abbreviations and Acronyms MoHESR Ministry of Higher Education and Scientific Research MOLSA Ministry of Labor and Social Affairs MoO Ministry of Oil MoP Ministry of Planning MSME Micro, Small and Medium Enterprise MTI Macroeconomics, Trade and Investment NASF National Assessment Strategy Framework NBFI Non-Banking Financial Institutions NDC National Determined Contributions NRA National Risk Assessment NVDP National Vaccination Deployment Plan OPEC Organization of Petroleum Exporting Countries PER Public Expenditure Review ABBREVIATIONS PFM Public Financial Management PMT Project Management Team PRS Poverty Reduction Strategy AND ACRONYMS RDF RE Reconstruction and Development Framework Recipient-Executed ReFAATO Reconstruction Fund for Areas Affected by Terrorist Operations RMC Reform Management Cell ABA Area-based Approach ESSRP Emergency Social Stabilization RRDP Recovery, Reconstruction and AF Additional Financing and Resilience Project IFAD International Fund for Agricultural Development Plan ASA Advisory Services and Analytics EWSP Emergency Water Security Plan Development SDI Service Delivery Indicator BE Bank-Executed FAO Food and Agriculture Organization IHSES Iraq Household and Socioeconomic SESDI Support for Education and Skills BSA Baghdad Sewage Authority FCI Finance, Competitiveness & Survey Development BSD Basra Sewage Department Innovation INES Iraq National Education Strategy SFD Social Fund for Development BWA Baghdad Water Authority FCV Fragility, Conflict and Violence IPC Infection Prevention and Control SOB State-Owned Bank BWD Basra Water Department FSAP DM Financial Sector Assessment ISIS Islamic State of Iraq and Syria SPJ Social Protection and Jobs CARP COVID-19 Adaptation and Program Development Module ITAS Integrated Tax Administration IT SSN Social Safety Net Recovery Pilot GCC Gulf Cooperation Council System TA Technical Assistance CBI Central Bank of Iraq GCCIA GCC Interconnection Authority KPI Key Performance Indicator TCP Transport Corridor Project CCDR Country Climate and Development GCT General Commission for Taxes KRI Kurdistan Region of Iraq TF Trust Fund Report GDP Gross Domestic Product KRSO Kurdistan Regional Statistics Office ToR Terms of Reference CEM Country Economic Memorandum GoI Government of Iraq MDC Mobile Data Collection TPMA Third-Party Monitoring Agent CF Competitive Fund GP Global Practice MENA Middle East and North Africa UN United Nations CRM Customer Relations Management HD Human Development MGF Mashreq Gender Facility UNEP United Nations Environment CSO Central Statistical Organization HRC High Reform Council ML/TF Money Laundering/Terrorist Program DLVT Directorate of Labor and I3RF Iraq Reform, Recovery and Financing UK United Kingdom Vocational Training Reconstruction Fund MoA Ministry of Agriculture WB World Bank DNA Damage and Needs Assessment IBRD International Bank for MoB Mayoralty of Baghdad WBG World Bank Group EIP Economic Inclusion Pilot Reconstruction and Development MoCHMPW Ministry of Construction, Housing, WEAI Women’s Empowerment in EODP Emergency Operation for ICT Information and Communication Municipalities and Public Works Agriculture Index Development Project Technology MoE Ministry of Education WFP World Food Program EPID Environmental Protection IDP Internally Displaced Person MoF Ministry of Finance WP White Paper Improvement Directorate MoHE Ministry of Health and Environment WSS Water Supply and Sanitation 8 I3RF ANNUAL REPORT 2021 9 Abbreviations and Acronyms BOXES 39 Box 1: Third Party Monitoring Agent Support for World Bank Financed Projects in Iraq in 2021 TABLE OF CONTENTS FIGURES 6 Acknowledgements 22 Figure 1: Priorities of the Iraqi Education Sector 8 Abbreviations and Acronyms 45 Figure 2: The I3RF Theory of Change 13 Overview 17 A Focus on the Economic Reform Agenda: TABLES Context and Advancements 14 Table 1: Number of Line Ministries and Government Entities 20 A Focus on the Education Reform Agenda: Involved in I3RF Projects 2020–2021 Results of the SESDI Project 14 Table 2: Type of Support to the Government of Iraq–2021 24 I3RF Results and Highlights 32 Table 3: Regional Workshops on COVID-19 Vaccination 41 The I3RF Portfolio 42 Table 4: Active Projects 2021 44 Operational Updates 43 Table 5: Pipeline Projects 2021 52 Financial Highlights 47 Table 6: Technical and Thematic Discussions Held in 2021 55 Looking Ahead 50 Table 7: I3RF Contribution to Iraq’s Nationally Determined 56 Annex 1 – I3RF Results Indicators for 2021 Contributions 64 Annex 2 – List of Projects with Details on Government 51 Table 8: Gender Equality and Women’s Empowerment in the Engagement I3RF 73 Annex 3 – Progress Overview Per Project 53 Table 9: I3RF Financial Highlights 2021 53 Table 10: I3RF Indicative Budget and Actual Disbursement 2021 10 I3RF ANNUAL REPORT 2021 11 Overview 01 OVERVIEW 1. The Iraq Reform, Recovery and Reconstruction Fund (I3RF) was founded in partnership with the Government of Iraq (GoI) in 2018 and is funded by Canada, Germany, Sweden and the United Kingdom (UK). The Trust Fund (TF) provides a platform for financing and strategic dialogue for reconstruction and development in Iraq, with a focus on promoting targeted national reform efforts and improving the effectiveness of public and private investments in socio-economic recovery and reconstruction. The I3RF also aspires to support gender equality, the climate change agenda, peacebuilding, and citizen engagement in Iraq. 2. Since its inception in November 2018, the I3RF has been working closely with the GoI to support its recovery and reconstruction plans as well as inform its reform agenda adopted in October 2020. In 2020, sector teams engaged with over 28 government counterparts and have contributed to different chapters in the White Paper (WP). In 2021, since the official adoption of the White Paper, sector teams continue to work closely with different line ministries and other government entities (cf. Annex 2) to develop concrete action plans to implement the White Paper through through technical assistance, advisory, analytical work and Recipient- Executed (RE) pilot projects. In 2021, the I3RF produced 32 multi-sectoral analytical works related to the White Paper of Iraq (cf. Annex 1). Sector teams have since worked in collaboration with government entities on strategy, reform roadmaps and evidence-based programming. The Bank- Executed (BE) activities of the Fund have progressed and are providing the basis for several pipeline Recipient-Executed activities which are expected to start implementation in the coming year. It is important to note that many of these projects aim to support the implementation of the GoI reform agenda as outlined in the White Paper. 12 I3RF ANNUAL REPORT 2021 13 Overview 3. The I3RF welcomed Sweden as a new donor v. In an effort to strengthen the strategic role in July 2021. The secretariat has been working of the I3RF as a platform for coordination closely with the Ministry of Planning (MoP) and dialogue on Reform, Recovery and and donors to develop a Communications Reconstruction, the I3RF secretariat Strategy, Visual Identity, and to update launched a series of Thematic Discussions the Fund’s Operations Manual. The Fund which are expected to become more active remains an agile tool to support the GoI in in the coming years and strengthen the emerging areas of priority, and in doing so strategic role of the I3RF as a platform has introduced several priority activities to for coordination and dialogue on Reform, the portfolio at the request of the GoI. Recovery and Reconstruction. In 2021 discussions were organized around 4. Key I3RF developments from 2021: climate change, response to COVID-19, TABLE 1: i. The I3RF currently has four donors (Canada, peacebuilding and citizen engagement (cf. NUMBER OF LINE 28 Table 6). 28 Germany, Sweden and the UK) who have MINISTRIES AND committed US$123.40 million, of which 5. The I3RF Steering Committee, co-chaired by GOVERNMENT ENTITIES US$94.17 million was received. Sweden the GoI’s MoP met three times in 2021 to discuss INVOLVED IN I3RF joined the I3RF donor community in July the strategic direction of the I3RF as a platform 2020 2021 PROJECTS 2020 –2021 2021; for reform and to endorse projects or changes ii. I3RF projects have informed policy under the Fund. The Donor Reference Group and programming in reconstruction, met regularly to discuss progress, coordinate agriculture, water, environment, energy, efforts, and hold technical discussions on social protection, education, health, public the projects financed under the Fund. The financial management, the financial sector, meetings organized by the I3RF Secretariat the private sector, poverty programming included participation from relevant line and peacebuilding. In 2021, the fund ministries and Development Partners, beyond strengthened its focus around reforms the members of the Steering Committee, and is also supporting the GoI to build and going forward representatives from the coordination systems to manage reform Ministry of Finance (MoF), the private sector, efforts; and the United Nations (UN) will participate in Steering Committee meetings. iii. The first two Recipient-Executed activities (Strengthening Immunization Systems 6. Structure of the third I3RF annual report: for Equitable and Quality Delivery of 19 15 18 10 This I3RF annual report focuses strongly on COVID-19 Vaccination through Third Party results achieved from the different projects Monitoring (P177038); and COVID-19 supported by the Fund. The report starts with Adaptation and Recovery Pilot for MSMEs a focus on the progress in the economic and in Iraq (P174273) under the I3RF became education areas. This is followed by Section active in October 2021 and December 4 – Results and Highlights – which covers the 2021 respectively; and since then several achievements of active projects of the Fund other RE activities have completed their throughout the last year. The next section project design and appraisal to become presents an overview of the I3RF portfolio effective. The grant agreement for the before sharing operational updates from Technical Assistance Advisory Analytics Endorsed Recipient- Iraq Household Socioeconomic Survey III Executed Activities 2021. The final sections provide a financial (P176590) has been signed, and the team overview and convey the Fund’s ambitions for is working with government counterparts 2022. The annexes detail results and progress TABLE 2: to meet effectiveness clauses before work of all projects under the I3RF, tabulate commences; T YPE OF SUPPORT TO THE GOVERNMENT OF IR AQ –2021 results achieved up to 2021, and show I3RF iv. The I3RF Operational Strategy for collaboration with the GoI per project. INITIATED/ACTIVE PROJECTS PIPELINE PROJECTS Communications was agreed with MoP and the Fund is finalizing its visual identity and branding guidelines in consultation with MoP; and 14 I3RF ANNUAL REPORT 2021 15 A Focus on the Economic Reform Agenda: Context and Advancements 02 A FOCUS ON THE ECONOMIC REFORM AGENDA: CONTEXT AND ADVANCEMENTS 16 I3RF ANNUAL REPORT 2021 17 A Focus on the Economic Reform Agenda: Context and Advancements 7. Global demand has boosted oil prices, electricity shortages as well as the impact of of Terrorism Office with the close at CBI and the MoF has agreed to the Organization of Petroleum Exporting the COVID-19 on the economy. coordination and cooperation between the recommendations for the conduct of an Countries (OPEC+) eased oil production Anti-Money Laundering and Countering Asset Quality Review (AQR) of the two limits to the benefit of Iraq, and COVID-19 11. Further major fiscal risks have emerged Financing of Terrorism Office and the WB largest banks. It is critical that these restrictions were gradually lifted, leading and may materialize anytime from growing teams, supported through the technical reforms are fully implemented to ensure to some recovery of economic activity budget rigidities, slow clearance of arrears, assistance of the I3RF funded project Iraq momentum is maintained towards the especially in the services sectors. The a large exposure of state-owned banks Financial Sector (P171615). The activity expeditious reform of the SOB enabling economic rebound was partially aided by and the central bank to the sovereign, and is still ongoing and it aims to broadly them to play their expected role in the government actions which continued to public investment management constraints improve the stability and integrity of the economy. The continuing dependence push forward the reforms as outlined in the that have impacted public service delivery. financial system and access to finance of a majority of Private Banks on a single White Paper and provided a small stimulus Nevertheless, progress on regional economic through reforms and capacity building. revenue source (FX arbitrage) is a cause of through public transfers and schemes aimed integration together with an improved security This will enhance financial infrastructure, concern and a potential financial stability at increasing credit to businesses. This led environment may provide new momentum for strengthen regulatory and supervisory risk as these banks lack the capital to the Gross Domestic Product (GDP) to grow by growth and diversification. frameworks and improve the efficiency invest in systems, operations and human 0.9 percent in the first half of 2021, after a 16 12. The breadth and depth of these challenges and impact of public interventions and capital to offer broad range of products percent contraction in 2020. underscore the need for an accelerated state-owned financial institutions. and services. CBI is cognizant of the risks implementation of structural reforms. As and is considering appropriate prudential 8. However, this recovery was held back - Delisting Iraq from the World Bank measures to mitigate these risks. by deteriorating public service delivery, such, the GoI has been keen on moving the list of non-compliant countries for including widespread electricity cuts and White Paper reform process forward. With reporting on external public debt. This - On business environment: after accessing severe water shortages following historic the support of the I3RF, reform governance will support Iraq to access increased the New York convention on arbitration, low rainfall which impacted agricultural structure was endorsed in which a High financial resources from multilateral dialogue between the public and private and industrial sectors. At the same time, Reform Council (HRC) at the ministerial institutions and improve the credit rating sectors has moved forward with the healthcare services deteriorated amidst level was designated and convened with of the country. This was achieved, in part creation of a high committee on business growing cases of COVID-19. Prime Minister chairmanship, and a Reform from the Debt Management support environment reforms at the Prime Minister’s Management Cell (RMC) was created to component, supported by the the I3RF as office and a business council coordinated 9. With oil prices trending above US$64 a barrel coordinate and follow-up on the 64 initiatives part of the Analytics and Advisory Services by the MoP. These will be important in January to July 2021, budget revenues of the White Paper. The RMC has been for Management of Public Resources and instruments to advance the White Papers rose by 52 percent, turning the fiscal balance partially staffed, and with continued support Fiscal Federalism project (P166640). reforms. into a 2.2 percent of GDP surplus and from the I3RF, it has been active in putting in lowering the public debt-to-GDP ratio. This place procedures for effective monitoring and 14. In addition, the following three areas of 15. The existing GoI White Paper’s comprehensive outcome was supported by a notable rise in evaluation as well as following-up with line economic reforms as outlined in the White list of economic reforms continue to remain domestic revenue mobilization as the 2021 ministries on the implementation of reforms. Paper have seen the most advancement in very relevant and, if fully implemented and budget law directives on customs and tax In this regard, an electronic dashboard to 2021: followed through, could put the economy on a administration, an integral part of the White collect data and ensure a more efficient more sustainable path that is less dependent Paper reforms, started paying off. Moreover, tracking of reforms is currently being finalized - On structural fiscal constraints: reforms on oil revenues. It is for this reason that the oil exports and foreign direct investments, and it is expected to be online in 2022. The linked to boosting domestic revenues have I3RF intends to continue its support towards namely in the energy sector, were both up by RMC has also been engaged directly on moved forward with relative success. The the implementation of the countrys‘ reforms 27 percent in the first half of 2021, leading to initiatives around improving public financial decision to devalue the Iraqi Dinar as well agenda. an improvement in the external account of management, the financial sector, and the as customs and tax administration reforms the country and boosting the central bank’s business environment. have been incorporated as directives in the useable reserves from US$48 billion in 2020 2021 budget law. These included linking to almost US$55 billion in the first half of 13. Technical assistance and capacity building customs to the currency window at the 2021, covering 15 months of imports. efforts, financed through the I3RF, have central bank limiting over-usage, border significantly contributed to two important management tightening, and improvement 10. The economic prospects for Iraq improved results namely: to tax collection measures among other with the recovery in global oil markets. Oil actions. GDP, the main driver of growth in the medium - Delisting Iraq from the European Union’s term, is expected to grow in line with the list of high risk countries for money - On strengthening the financial industry: gradual phase-out of OPEC+ production laundering , which will open up numerous progress has been made spearheaded by quotas, while non-oil GDP growth is opportunities for the Iraqi financial sector the Central Bank in proceeding towards forecasted to remain under 3 percent in 2021– to develop, grow and attract private implementing a number of key reforms 2023 in the absence of an accelerated process investments. This result has been achieved including new corporate governance of reforms and the persistence of water and under the leadership of the Anti-Money bylaws for Rasheed and Rafidain (R&R), a Laundering and Countering Financing dedicated SOB unit has been established 18 I3RF ANNUAL REPORT 2021 19 A Focus on the Education Reform Agenda: Results of the SESDI Project in Iraq P175694), as well as TA (Support school closure due to COVID-19, displacement, to Education and Skills Development in destruction of education infrastructure, and Iraq P171165) providing research, capacity the psycho-social needs of learners. The INES building, analytical and policy work and small was developed over the last two years by the pilots, that will provide evidence-based inputs GoI, with technical support from UNESCO, into the Iraq education sector reform agenda. UNICEF, and the World Bank (WB), and will be finalized by December 2021 . In a subsequent 18. A key deliverable under the TA (Support to phase, the WB team will provide technical Education and Skills Development in Iraq support for the development of 3-year P171165), is the Building Forward Better to implementation plans, translating the INES Ensure Learning for All Children in Iraq: An into costed activities. Education Reform Path, which was published in FY21 and translates key education 21. Building on the education reform note’s priorities identified in the Government of recommendation to promote evidence‑based Iraq’s White Paper1 into actionable education decision‑making, the Service Delivery reform recommendations to boost learning Indicator (SDI) survey will assess strengths and skills. The recommendations focus on and shortcomings of schools to promote immediate crisis response and medium and learning, while collecting urgently needed long-term needs across six key strategic areas learning data. Data collected as part of the SDI (see figure 1). will provide urgently needed information on 03 teacher practices, mastery of content, students’ 19. Building on the reform note and its learning, adequacy of learning materials for recommendation to improve the governance students and teachers, school infrastructure of the education sector and promote and school management, and home evidence‑based decision‑making, the Iraq environment. Findings from the SDI survey will Public Expenditure Review (PER) for the enable the GoI to make strategic, cost-effective Human Development sectors (HD PER) was decisions on teacher recruitment, employment, completed and launched in early 2021 . In and training policies. In addition, findings from A FOCUS ON THE EDUCATION education, the HD PER found that public funding to the sector has been declining in the SDI will allow the GoI to analyze learning outcomes against measures of equity to best REFORM AGENDA: recent years, leading to underinvestment in education, particularly neglecting school support the most marginalized and vulnerable groups. The SDI survey has been developed, infrastructure leaving a substantial gap for RESULTS OF THE SESDI new schools and school reconstruction after years of conflict. The PER identified ways and enumerator training for data collection started in December 2021 . Data collection will PROJECT start from February 2022 onwards with the SDI to increase the share of public spending, report delivered over the summer of 2022 . improve the implementation of non-salary Relates to the Results of the Project: Support to Education and Skills expenditures, target additional public 22. Building on the education reform note’s Development in Iraq (SESDI) (P171165) resources toward groups and areas with recommendation to focus on the most greatest need, and modernize policies urgently needed investments, while ensuring 16. Human capital development is imperative to achieve sustainable and inclusive and practices governing student learning better utilization of resources, key outputs economic growth in Iraq. At the heart of Iraq’s human capital crisis is a learning assessment, teacher allocation, and under the Advisory Services and Analytics crisis, which has been exacerbated by the effects of the COVID-19 crisis on education infrastructure management. (ASA) are a school infrastructure policy and service delivery. The low levels of human capital development, coupled with limited teacher allocation diagnostic and guidance 20. Building on the education reform note and its note. Years of conflict have led to a severe opportunities to gain job-relevant skills, have translated into worsening economic recommendation to develop and implement and social outcomes. To date, Iraq has some of the lowest Human Development shortage of school buildings, many of which an education sector strategy that focuses now run in two and three shifts, effectively (HD) indicators in the region. While, now more than ever, investments are needed in on learning, the Iraq National Education education to recover lost learning and turn crisis into opportunity, these investments limiting learning time and opportunities. Strategy (INES) 2022–2031 outlines the vision The Ministry of Education (MoE) estimates must be accompanied by a comprehensive reform agenda that focuses the system on of the GoI for its education sector for the learning outcomes and builds a more resilient education system for all children.  that an additional 8000 school buildings are next 10 years, while addressing the effects of needed, with 50 percent of current buildings 17. Technical and operational education sector support financed by the I3RF respond to past and ongoing crises, including prolonged these urgent needs in Iraq; they finance pilot initiatives to provide the most urgently needed resources to inform national scale up and future lending (Innovations towards 1 responding to Priority Area 2.6 Human Development and Strategies, and 5.2 Governance and public administration Learning in Lagging Iraqi Governorates P175721 and Support to Tertiary Education reforms, and 1.3 Reforming financial management systems, and 4.4. Implementing School Construction Plan 20 I3RF ANNUAL REPORT 2021 21 A Focus on the Education Reform Agenda: Results of the SESDI Project FIGURE 1: in dire need of rehabilitation.2 With demand 25. Building on the education reform note’s PRIORITIES OF THE IR AQI EDUC ATION SECTOR for new buildings largely outweighing supply, recommendation to improve the governance planning and prioritization are essential for of the education sector and promote construction of educational infrastructure in evidence‑based decision‑making, this ASA Crisis response: Mitigate Immediate Learning Loss and Preventing Iraq. The Schools Infrastructure Policy, to be supports the technical assistance in the Further Dropouts • Strengthening foundational literacy & numeracy skills in the foundational finalized by December 2021 , and led by the development of a Mobile Data Collection (MDC) years in primary school. Department of Educational Planning of the Platform, and the hardware financed under • Using innovative approaches could support self-learning for youth in MoE, formulates a set of construction norms the Emergency Operation for Development secondary and vocational education. accounting for rural and urban differences, Project (EODP). This will complement the long- • Supporting the most vulnerable children through additional resources, prioritization mechanisms, and guidelines for term goal of establishing a comprehensive for example through school grants or cash transfer programs. maintenance of school infrastructure. It serves Education Management Information System, as a model policy for adoption by all agencies while providing a simple platform for involved in construction of school buildings, urgently needed education indicator to track Improve Foundational Skills to set a Trajectory for Learning - including public works departments, other geographic, educational, demographic, and through Improved Learning Materials and Strenghened Teacher government construction departments, local socio-economic data collected on tablets or Practices That Support Learning for All Children bodies, or private construction agencies. mobile devices. A data analytics portal will • Developing teaching and learning materials for preschool and early disseminate interactive reports, dashboards, grades to build strong and foundational skills. 23. Teacher deployment is a major challenge and analytics maps. The MoE team has been • Strengthening adaptive teaching strategies and psychosocial support. for the education sector in Iraq, with very engaged in a participatory approach, focusing large variations in student teacher ratio on capacity building and empowerment of a both between governorates, and within multidisciplinary team from GIS, Statistics and Focus on Most Urgently Needed Investments, While Ensuring Better governorates. These variations reflect Utilization of Resources Planning, IT Development, IT Infrastructure, a deployment system undermined by Networks and Security. The MDC, supported • Supporting reconstruction and rehabilitation of school infrastructure widespread nepotism and local influence, lack under EODP, which includes a Geographic in the most deprived areas. • Enhancing utilization of existing school infrastructure to improve the of a clear allocation formula, and absence of Information System, will be finalized by quality of education under existing budget constraints. monitoring. The Teacher Allocation Diagnostic February 2022, and will support planning • Increasing efficiency in teacher allocation and reviewing teacher and Guidance Note, developed with a working and decision-making with a special focus on recruitment practices to improve the quality of education. group within the MoE, to be finalized by the development of guidelines for human February 2022, identifies options for a formula resources allocation and infrastructure for teacher allocation, and mechanisms to deployment optimization. Improve Governance of the Education Sector and monitor deployment performance, and to Evidence-Based Decision-Making reduce the imbalance over time. 26. Building on the education reform note’s • Improving planning and management capacity and governance recommendation to align skills with labor of the education sector. 24. Building on the education reform note’s • Increasing transparency in education financing and link market needs through targeted programs recommendation to develop an assessment and reforms, the Competitive Fund (CF) financing to education outcomes. • Strengthening autonomy of schools to manage their own funds. strategy that sets out goals for classroom and Initiative was developed with the Ministry education policy assessments, the National of Higher Education and Scientific Research Assessment Strategy Framework (NASF) was (MoHESR). The CF supports university–private jointly developed with the MoE and will be sector partnerships to improve the quality Develop an Education Sector Strategy That Focuses on Learning and finalized by February 2022. The assessment “Building Forward Better” and relevance of academic programs and system in Iraq is still nascent: Large scale graduates’ employability. Close to 300 concept • Developing a National Education and Training Strategy. assessments that can inform system progress, proposals were received from approximately • Developing an assessment strategy that sets out goals for classroom assessments to monitor student’s individual progress, and large-scale provide input into curriculum reform and 30 universities across Iraq, of which 9 fully- assessments to inform education policy. teacher support, as well as classroom developed proposals were selected through assessment practices, to help the teacher a competitive and transparent process gauge learning progress of students, are very in October 2021 by a CF Committee of limited and not systematically implemented. representatives from relevant ministries Align Skills with Labor Market Needs The NASF, proposes a strengthened national (including MoP and MoF), universities and the • Developing school-to-work transition programs to facilitate learning assessment system based on better private sector. The CF initiative pilot has been entry of university graduates into the labor market and to quality assessments and use of assessment rolled over to be part of the new Support to improve their employability. data to inform policy making and teaching • Aligning tertiary education programs and governance with Tertiary Education in Iraq project (P175694) to practices to promote learning. receive further financial and technical support. international standards and labor market needs. 2 Current number of school buildings (2018-2019): 15,902. Estimated deficit: 8.093 school buildings, Schools in need of rehabilitation or complete reconstruction: 8,831 school buildings 22 I3RF ANNUAL REPORT 2021 23 I3RF Results and Highlights 04 I3RF RESULTS AND HIGHLIGHTS This section presents results and highlights of active projects under the Fund and is structured around the I3RF’s three main pillars. 24 I3RF ANNUAL REPORT 2021 25 I3RF Results and Highlights 4.1 PILLAR 1 – following criteria: (i) City size & function; (ii) ing and reporting on the impact of COVID-19. Climate change vulnerabilities; (iii) Donor The objective was to keep both Government SOCIO‑ECONOMIC RECOVERY landscape; (iv) Level of physical damage; (v) and donors informed of key trends and policy AND RECONSTRUCTION Stability & security; (vi) Internally Displaced options. 28 Biweekly Food Security Monitor- Persons (IDPs) & returnees; and (vii) Poverty. ing reports and 4 Quarterly Policy focused re- Based on the 32 city analysis, Baghdad and ports were produced and circulated. The re- 27. This pillar aims to leverage grant funding Basra have been selected as priority cities ports helped create awareness of rising food to support innovative pilot programs, and for the ABA in addition to Mosul. Climate insecurity and revealed the system’s fragility. complements or co-invests in government risk assessments have been carried out for Strengthening Iraq’s food system is now a key programs with a focus on International the three cities, with additional assessments priority in the Government’s White Paper on Bank for Reconstruction and Development- planned for other cities identified as having economic reforms. The WB and UN Agencies financed (IBRD) programs to improve their high climate risk vulnerability. The diagnostic partnership has created a more aligned and effectiveness. and risk assessments will also feed into coordinated platform to engage with Gov- 28. The results of the Support to Education and the development of the ABA strategy. As ernment on this reform agenda. In addition, Skills Development in Iraq project (SESDI) of June 2021, a number of trainings have the forthcoming paper on Building Food Pol- (P171165) are reported on in section 3 - A been conducted for PMTs, with a total of 65 icy Capacity will offer pathways and invest- Focus on the Education Reform Agenda: beneficiaries so far to prepare their respective ment options for building the capacity of the Results of the SESDI Project. investment plans (funded by EODP) that are Government to respond to future shocks and inclusive and are based on ABA principles. strengthen the resilience of the system. 4.1.1 Adopting an Area-Based Approach to Reconstruction 4.1.2 Revitalizing the Agriculture Sector 4.1.3 Mapping Environmental Hotspots in Relates to the Results of the Project: Area-Based Relates to the Results of the Project: Revitalizing Conflict-Affected Governorates Approach in Mosul and Other Urban Centers In Iraq the Agriculture Sector (P171561) Relates to the Results of the Project: Support To (P162875) Manage Environmental Pollution Hotspots In Iraq 32. The project aims to deliver policy (P173049) 29. The project aims to support planning for recommendations and innovative approaches and facilitating an Area-Based Approach to digital transformation and climate-change 35. The project aims to support GoI to analyze (ABA) using integrated multi-sector and adaptation in the agri-food system, and to environmental hotspots and prioritize participatory approaches to the recovery promote labor participation of women in the rehabilitation and clean up actions. It and reconstruction of Iraq’s urban centers, sector.  will help establish a framework for sound starting with Mosul as a pilot. This will inform management of environmental and conflict 33. The activity is an initial step towards lon- pollution hotspots in Iraq in order to mitigate recovery and reconstruction investment ger-term modernizing of Iraq’s agri-food health and safety risks and contribute to local decisions to promote social reconciliation, sector and maximizing its contribution to economic development through remediation. incentivize economic development and job employment, economic recovery, diversifi- creation, and restore services, along with a cation, and resilience. It aims for an in-depth 36. Building on ongoing efforts of the Chemical focus on institution building and restoration transformation process through a 3-track Management and Contaminated Sites of cultural heritage assets. approach: Policy Formulation and Capacity Assessment Department of the Ministry of 30. Based on the World Bank Group’s (WBG) Building (track 1), Social Inclusion (track 2), Health and Environment (MoHE) and other experience in post-conflict recovery and and Technological Innovation (track 3). development partners such as the United reconstruction, the activities fall under Nations Environment Program‘s Crisis 34. COVID-19 underscored the fragility of Iraq’s Management Unit (UNEP), the project is three key pillars, namely the (i) ABA for national food system. Specifically, conse- carrying out the following tracks: (i) Prepare Urban Reconstruction; (ii) Subnational quences of the pandemic disrupted both a detailed inventory of critical pollution Project Management Team’s (PMT) Capacity food and input supply chains, caused food hotspots in Iraq; (ii) Identify priority sites for Development for area-based sub-project price spikes, increased food insecurity, and remediation with emphasis on community identification and implementation; and reduced incomes (especially for the poor). health and safety and local economic (iii) Pilot projects and harnessing Cultural In the early stages of the outbreak, the WB development; (iii) Support preparation of Heritage for reconstruction and recovery. team formed a partnership with the UN Food technical studies (including engineering, 31. In 2021, the project produced a stakeholder Agencies (Food and Agriculture Organization costing, etc.) for remediation of priority and engagement plan in Mosul and nationally. (FAO), International Fund for Agricultural De- hotspots; (iv) Support preparation of a Analytical diagnostics of 32 Iraqi cities have velopment (IFAD) and World Food Program national register of contaminated hotspots, also been undertaken to select three cities (WFP)). The purpose of the partnership was and; (v) Develop a road map/action plan for for the ABA project, on the basis of the to create a coordinated approach to monitor- 26 I3RF ANNUAL REPORT 2021 27 I3RF Results and Highlights the program on remediation of hotspot sites and Sewage Improvement Project and a objectives). The main findings are (i) Due 45. The White Paper – “Iraq - Final report in Iraq. program of utility reform TA to the Basra WSS to the challenges, both old and new, that Emergency Cell for Financial Reforms” of service provider, adapting good WSS utility Iraq faces, the national strategy for the October 2020 highlights a clear objective for 37. As a first step, a satellite mapping of 77 management practice to Iraq’s specific FCV development of water and land resources reforms of the water and sanitation sector in environmental hotspots in the seven conflict- context. The initial implementation support for the next 20 years needs to be revised to the country, namely the development of “a affected governorates (Nineveh, Anbar, will leverage the US$210 million of IBRD take into account the lack of investment over water and sanitation management system Salah El Din, Diyala, Kirkuk, Baghdad, and financing for the Baghdad WSS Improvement the past five years, demographic changes that rationalizes consumption and maintains Babylon) was carried out. Based on this Project, which became effective in 2018, by due to internal displacement and the actual sanitary and environmental systems”. It satellite mapping, priority sites for detailed working with its implementing agencies; the economic context, and significant changes specifies the importance to restructure the mapping were also identified. In parallel, Mayoralty of Baghdad (MoB), the Baghdad in the hydrology of the Twin Rivers over the municipal departments and concerned a comprehensive eight module training Water Authority (BWA) and the Baghdad past 5 years. In particular, the destruction of institutions in charge of water and sanitation program for 30 MoHE officials was conducted Sewage Authority (BSA). The project will water infrastructure by Islamic State of Iraq services on commercial or semi-commercial to build their capacity in identification of support MoB, BWA and BSA to: (i) Assess the and Syria (ISIS), climate change impacts, and basis. In line with this, the project developed hotspots, conducting site assessments, extent and quality of existing water supply the completion of the Ilisu Dam on the Tigris a ToR to study corporate governance preparation and implementation of and distribution data, customer information River in Turkey are all significant changes restructuring options for improved water remediation plans. The activity, financed by and finance data and plan how to improve it that must be accounted for in planning for supply and sewerage service provision in I3RF, is following ‚Learning by Doing Approach‘ including advice on how to reverse the free water and land use. (ii) Another aspect of the Baghdad. to build the capacity of stakeholder agencies. water provision policy under COVID-19; (ii) Strategy in need of updating is in the role of For this purpose, the team at MoHE is involved Provide advice on the implementation of local institutions in decisions about water 46. While implementing the above-mentioned in the design of various tasks and is working the institutional development plan; and (iii) allocation and use. Although central water activities, the project team will document with technical consultants in carrying out the Document emerging lessons from Baghdad resource institutions must retain oversight, emerging lessons from Baghdad in short inventory and related primary investigations. to directly feed into the Basra TA program. In there are opportunities to decentralize some accessible notes in English and Arabic and In addition to MoHE, the activity is also parallel, a TA program for Basra’s WSS service aspects of water management that would directly feed these into the Basra TA program, engaging with the Environmental Protection providers – the Basra Water Department draw on local knowledge and priorities. which will follow the same steps and is likely Improvement Directorate (EPID), the (BWD) and the Basra Sewage Department The report describes the main principles to achieve the same results. Environmental Council, EPIDs within the (BSD) will draw on the emerging lessons from of the national strategy before going on to identified Governorates and the Ministry of the Baghdad operation. reconsider how national, regional, and local Oil (MoO). 4.1.5 One Step Closer to a More Efficient institutions could find new ways to allocate 41. The TA program for Basra will include: (i) Energy Sector 38. Based on the project’s progress, an RE water so as to promote local interests and Assessing processes of water, customer and Relates to the Results of the Project: Technical & activity will be designed that can implement capabilities while accounting for the overall financial management and developing a Economic Due Diligence To Support Iraq Southern remediation of priority hotspots, augment water resources limits expected to be Region Electricity Network Reinforcements plan to modernize systems and reverse the available to Iraq by 2030. the laboratory and detailed assessment (P175879) free water provision policy under COVID-19; infrastructure at MoHE, and design a national and (ii) Developing options for a water 43. Furthermore, the project will assess the 47. The project aims to provide the Iraq Ministry of program for the remediation of polluted sites supply backup plan for Basra’s recurrent impact of climate change on water resources, Electricity with technical support to conduct in Iraq. summer drought emergency. Based on this which will add substantial data in the load flow analysis to evaluate the capacity of TA, roadmaps for the corporatization of the development of the EWSP for BWA. A Terms planned electricity network reinforcements Baghdad and Basra WSS service providers of Reference (ToR) was drafted to recruit a in the southern region to meet the energy 4.1.4 Supporting Good Practices in the Water will be developed. While the institutional consultancy service to assist in developing it. supply from the Gulf Cooperation Council Sector setup for service delivery is different in Furthermore, this will feed into the update of (GCC) member states through the planned Relates to the Results of the Project: Water Supply Baghdad and Basra, these roadmaps would the national strategy. interconnection with the GCC Interconnection And Sanitation Utility Reform Technical Assistance (P175808) have common elements and may provide a Authority (GCCIA). template for other parts of Iraq, and would 44. In addition, the project completed a roadmap 39. The project aims to adapt global good thereby provide a springboard for developing for the digital transformation of WSS 48. The key deliverable expected from the TA Water Supply and Sanitation (WSS) utility a national program of WSS service provider delivery. The report included an assessment activity is a technical and economic/financial management practice to the Fragility, Conflict reform. of customer relations management (CRM) analysis report that evaluates existing and Violence (FCV) context of Baghdad and and billing systems, and has identified electricity transmission infrastructure Basra with a view to building a national utility 42. In working towards its first results in Area opportunities to improve the current status in the southern region and assess and reform program financed from a diverse base Based Approach Plans (i.e., Emergency and proposed future state information prioritize needed reinforcements. The of international financial institutions lending, Water Security Plan (EWSP)), the project technology architecture (models) and key expected outcome is to enable an efficient public, and private sector financing. has developed a diagnostic report on the programs of work to deliver future business interconnection with the GCC member 2015 strategy for water and land resources requirements at BWA. The team is working states to evacuate the initially agreed 40. This project will provide implementation (Water Resources Planning and Investment with BWA and MoB in the procurement of the supply of energy (500 MW) with the GCCIA support to the institutional development Analysis; how local reallocation can help CRM and billing system to improve customer and subsequent expansions to reach the aspects of the Baghdad Water Supply meet national water resources management relations and revenues management. 28 I3RF ANNUAL REPORT 2021 29 I3RF Results and Highlights interconnector’s total capacity (1,800 MW) as on people’s welfare and livelihoods, and the work over the previous year to establish the urgent health needs in responding to well as increased domestic supply. Government’s ambitious White Paper – which a sample frame, relevant grids for the the pandemic and; (ii) the medium-and has led to requests for further Bank support. informal business surveys, digitalization and long-term health sector reform priorities. It 49. In 2021, work has significantly advanced on translation of questionnaires, and training complements ongoing GoI and development collecting the needed data. This includes 51. The TA covers three main activities. The enumerators and interviewers. The data partners’ efforts in both areas. detailed lists and technical specifications first one, the Social Protection Support collection is expected to be finalized by the of: (1) existing generating units with bus Program currently in its third phase of end of May 2022. The launch of these surveys 55. In 2021, significant progress was achieved numbers, zone, fuel type and MW rating; (2) implementation, seeks to support social provides Iraq with a unique opportunity to under its 1st component “COVID-19 planned generating plants for 2020-2035; protection reform with a focus on building understand its private sector job creation Emergency Response” which is an urgent (3) generating plants modeled in the 2030 strong Social Safety Net systems, providing challenges, especially after the pandemic priority given the unfolding pandemic. The Case; (4) new transmission line additions; policy advice for pensions reform, and and economic downturn. It is also the first component includes 4 tracks which aim to (5) transformer additions; (6) existing enhancing the links between humanitarian time that these WB microenterprise and “prevent”, “detect” and “respond” to COVID-19, transmission lines; (7) existing transformers; and development activities. Over the past informal business activity surveys have been and provide “just-in time technical assistance” and (8) planned transmission lines and two years, the team worked with the Ministry conducted in Iraq and in the Middle East and in health. transformers for 2020-2035. A preliminary of Labor and Social Affairs’ (MOLSA) Social North Africa region (MENA). The analysis and load flow analysis has been conducted by Protection Commission on assessing existing 56. Under the 1st track – “Prevent”, a findings of these surveys will be discussed Communication Action Plan for COVID-19 the Bank team, which includes: (1) overview Information and Communication Technology with the Government and disseminated in of the Iraq power system; (2) evaluation of (ICT) systems and infrastructure, cleaning the vaccination was developed. The team order to launch a substantial jobs agenda for has also completed (i) the first round of a the technical capability of Iraq’s transmission existing databases, as well as building the the country in 2022. networks (132kV and 400kV) to dispatch its capacity of IT team in enhancing the cyber Facebook survey to explore attitudes related own thermal and planned renewable energy security and installation of servers. This 53. The third activity is TA for the design of an to COVID-19 vaccination in Iraq, and (ii) an generation, as well as the 1,800MW imports milestone will allow the Ministry to secure Economic Inclusion pilot - which will now experimental online A/B testing to identify via a GCCIA connection; and (3) multiple its databases and manage more effectively also be implemented through I3RF financing. effective messages for the communication scenarios and sensitivity analyses for Iraq’s its programs. In addition, the TA allowed for The assistance focused on building consensus campaign to increase vaccine acceptance. connection points with the GCCIA backbone several key analyses: (1) an update of poverty for the concept and interventions of the Results of the survey and A/B testing have interconnector, including geographical and vulnerability assessment following the pilot, by bringing international experience been shared with the Government and other locations and estimated costs. A first draft impacts of the pandemic and the fluctuation to the client through presentations led by stakeholders. of the report has been completed and is of oil prices, which was discussed, presented the WB and government officials from the 57. Under the 2nd track – “Detect” which supports undergoing further review and discussion. and shared with the Government in late 2020; MENA region on similar programs. Following the GoI to strengthen COVID-19 case detection, (2) a report on the gaps between humanitarian a year of discussions with MOLSA, the pilot, the project has produced four analytical and social protection beneficiaries following beginning in 2022, will target at least 2,200 reports: (i) an assessment of Iraq’s COVID-19 4.1.6 Strengthening Social Protection a field test done jointly with the Cash Working Cash Transfer Program beneficiaries in rural surveillance systems; (ii) an assessment of Frameworks and Schemes Group and recommendations for reform; areas of ThiQuar to help them develop their COVID-19 testing in Iraq; (iii) a guidance Relates to the Results of the Project: Social (3) a report on findings from a behavioral self-employment activities. They will be document on COVID-19 testing strategies and Protection And Jobs For Poor And Vulnerable Iraqis intervention to enhance student learning supported through a series of subsequent (P171639) algorithms; and (iv) an assessment of contact through better parental practices at home, and simultaneous interventions that include tracing in Iraq. Since the delivery of these 50. The Social Protection and Jobs for Poor and and finally; (4) a Pensions and Social Insurance training, coaching, mentoring and in-kind reports, 4 workshops on the use of different Vulnerable Iraqis is a TA program that aims Chapter as part of the recent HD PER, in which asset transfer for their livelihood activities. digital platforms in contact tracing (DHIS2, to support the GoI in three key areas: (1) to the main issues of the current pension system ComCare, OpenSRP and GO.DATA) have been develop a resilient Social Safety Net (SSN) were analyzed, and recommendations for conducted for MoHE. Two workshops on reform were provided. 4.1.7 Reinforcing the Healthcare System in system that builds on the Government’s COVID-19 testing were also conducted for achievements; (2) to better understand Light of the Pandemic 52. The second activity is a Private Sector Analysis frontline laboratory technicians. Additional workforce skills and private sector job creation Relates to the Results of the Project: COVID-19 and Skills Assessment based on three large workshops on COVID-19 surveillance and Response And Health System Strengthening that ultimately lead to reforms for more and (P174641) testing are currently under development. surveys to understand the dynamics of the better employment; and (3) to provide the private sector, its role in job creation, and 58. Under the 3rd track – “Respond” which focuses analytical base to pilot interventions that 54. This project was endorsed and added to the skills that it requires in Iraq. The first primarily on COVID-19 case management, increase access to sustainable livelihoods. the fund’s workplan in September 2020 in set of informal business activity surveys was and includes TA to improve patient flow, as Launched in November 2019 with majority response to health priorities emerging from launched in August 2021 in three of the four well as infection prevention and control (IPC) I3RF financing, and further financing from the COVID-19 pandemic. It provides TA and cities (Baghdad, Basra and Sulaymaniyah), in health facilities. The team developed an the Partnership for Economic Inclusion, the conducts analytical work to inform health with Najaf starting in December. The Enterprise IPC and patient flow assessment instrument TA has allowed the Bank to advance the policies in two areas: (i) responding to the Surveys (which include microenterprises in and deployed it in nine health facilities; dialogue with key counterparts on social COVID-19 crisis and; (ii) improving access four cities, and small, medium, and large the information collected was combined protection and jobs reforms. This has been to quality health services. The initiative enterprises in 10 cities) were also launched with multisource information gathering, timely given the repercussions of COVID-19 therefore aims to help the GoI address (i) in December 2021. This followed extensive 30 I3RF ANNUAL REPORT 2021 31 I3RF Results and Highlights and reports on both IPC and patient flow the blueprint for Iraq’s vaccination efforts in 4.2 PILLAR 2 – were finalized and delivered to the MoHE. collaboration with WHO, UNICEF and other Dissemination workshops are currently being partners; (iii) provision of technical inputs for ECONOMIC DIVERSIFICATION developed. the development of a digital client registry AND PRIVATE SECTOR-LED for COVID-19 vaccination; (iv) development of 59. In addition, the team has been providing a social media listening platform related to GROWTH additional just-in-time technical assistance vaccination in Iraq using TalkWalker tool; (v) (4th track) to support the COVID-19 response, technical review of Iraq’s National Strategy 60. This pillar aims to provide technical assistance with a focus on vaccination. The project has for Adverse Events Following Immunization and support to the GoI to develop and provided support under the following areas: (i) or AEFI; (vi) a country workshop on oxygen coordinate a comprehensive set of reforms completion of a country readiness assessment safety in healthcare settings; and (vii) to advance on a diversification agenda and for vaccination using the integrated VIRAF/ engaging Iraq in 10 regional workshops on enhance private sector-led growth. VIRAT 2.0 tool; (ii) development of the National COVID-19 vaccination organized by the World Vaccination Deployment Plan (NVDP) with Bank . Each workshop focused on a strategic all the key elements recommended by the aspect of vaccination (cf. Table 3). 4.2.1 Support for the Reform Management World Health Organization which serves as Cell Relates to the Results of the Project: Economic Diversification And Growth (cf. Focus on the Economic Reform Agenda section) (P176098) TABLE 3: REGIONAL WORK SHOPS ON COVID-19 VACCINATION 61. The GoI has requested the WB’s support to establish a Performance Framework Introduction and Vaccination strategies — Share best practices and lessons learned from current COVID-19 to accelerate implementation of the WB 1. vaccination efforts and provide tools and practical suggestions for planning under extreme uncertainty Program for Economic Reform. The World Vaccine Financing — Estimate total costs of vaccine procurement and distribution and help countries Bank has been supporting the RMC for the 2. assess key options and trade-offs for mobilizing domestic and external funds development of the Performance Framework through TA. This TA is to provide the RMC Procurement and Distribution Network — Provide overview of procurement landscape & emerging 3. team with the needed global knowledge and portfolios; discuss key considerations and implications of various distribution network archetypes international expertise to bolster their efforts Supply Chain Readiness — Discuss methods of strengthening and expanding supply chains for emerging in designing, implementing, and maintaining 4. portfolios of vaccines an effective performance system which will Administration & Follow-up: The Beneficiary Journey — Examine the journey of the beneficiary, considering manage the progress made towards achieving 5. digital tools and approaches to support it, with a focus on equity the strategic objectives and the reform goals that are detailed in the implementation of the Costing & Human Resources — Review strategies on the COVID-19 vaccine costing process and key costing 6. White Paper of the Reform Implementation tools available; consider key levers to increase health care worker capacity Plan. The project is supporting the design 7. Thinking for the Future — Share reflections and key takeaways from the workshops and bring together of the Performance Framework, assisting leading experts for a forward-looking discussion in identifying the critical Key Performance 8. Building Vaccine Confidence Indictors (KPIs) to be monitored, developing fit for purpose reports to decision makers, 9. Deploying Multiple Vaccines, using a portfolio approach creating tools to identify actions when 10. Engaging Private Sector in Vaccine Delivery performance is off track, developing an electronic reporting system, helping in strengthening the engagement, coordination and communication with key stakeholders and finally assisting in increasing the RMC capabilities to implement and supervise these functions. 32 I3RF ANNUAL REPORT 2021 33 I3RF Results and Highlights 4.2.2 Progress on Financial Sector Reforms recommendations presented in its SOB 67. Under pillar 2, the Microfinance Sector made use of ongoing work and analysis funded Relates to the Results of the Project: Iraq Financial Reform and Restructuring Roadmap for the Development component of the project, the under this activity, and plans to disseminate Sector (P171615) two largest Banks (Rasheed and Rafidain) and team provided extensive TA (Feasibility study, the recommendations of the Technical Note its Technical Note on Corporate Governance New Products, Process flows, TORs, Ops through a series of virtual/onsite events. 62. The objective of the project is to improve the Reforms of SOBs. Progress has been made in Manuals, Capacity building etc.) to MOLSA stability and integrity of the financial system 2021 spearheaded by the CBI to implement a to establish a pilot microfinance unit as part and access to finance through reforms and 4.2.3 Strengthening the Management of number of key reforms as recommended by of the Emergency Social Stabilization and capacity building to enhance financial Public Resources and Fiscal Federalism the WB including the drafting of new corporate Resilience Project (ESSRP). Unfortunately, infrastructure, strengthen regulatory and Relates to the Results of the Project: Analytics And governance bylaws for Rasheed and Rafidain. the project has been suspended since supervisory frameworks and improve the Advisory For Management Of Public Resources And A dedicated SOB unit has been established January 2021 and is now cancelled. The team efficiency and impact of public interventions Fiscal Federalism (P166640) at CBI and the MoF has agreed to an Asset provided extensive TA (OPS Manual, Process and state-owned financial institutions. Quality Review of the two largest banks. The Flows, TORs for key staff, Capacity Building, 69. The MoF requested the WB’s assistance in The project consists of two broad pillars: team conducted virtual meetings with key KPIs, Policies and Procedures etc.) to the MoP the General Commission for Taxes (GCT) “Strengthening the Foundation for Financial stakeholders involved in the restructuring of to set up a microfinance unit under the Social automation in order to support with the Sector Development” and “Developing state-owned financial institutions, and, at the Fund for Development (SFD). Unfortunately, acquisition of an integrated tax administration Specialized Finance”. The first pillar entails request of CBI and MoF, the WB developed a the project has been delayed as the SFD Law IT system (ITAS), RFP, and Procurement. The three components related to reforms of SOBs ToR for an independent Assets Quality Review is yet to be approved in Parliament. The MoP WB proposed a roadmap which outlines a and strengthening of banking sector licensing, of the two largest state-owned financial informed the WB of the intention to drop sequence of potential actions to secure WB regulation and supervision; National institutions. Component 2 (TA to set up the SFD MF unit) support, along with the relevant technical payments system strengthening; and National and reallocate its funds to Component 1 due work and activities. The proposed roadmap Money Laundering/Terrorist Financing (ML/ 65. Regarding the National Payments System to governance related issues. In view of the considers: TF) risk assessment. The second pillar will Strengthening project, two workshops and aforementioned, and in response to the impact develop specialized finance with a specific the draft implementation plan for digital - The services requested for the research, of the COVID-19 pandemic on the Micro, Small focus on microfinance and housing finance. onboarding and electronic Know-Your- design, development, and end-to-end and Medium Enterprises (MSMEs) sector, the Customer (e-KYC) were delivered in 2020. In team shifted the activity of supporting the advisory services for procurement 63. The progress of the project this year follows 2021, the team produced a set of case studies development of the regulatory framework activities. the TA which included inputs on banking on the regulation and oversight of e-money for MSMEs and has incorporated this activity sector reforms to the WB, recommendations - The services required to ensure impartiality providers, a mapping of risks to the national as part of the COVID-19 Adaptation and on Corporate Governance Reforms in and the use of internationally established payment system, guidance on relaunching the Recovery Pilot (CARP): Supporting Firms’ SOBs, recommendations and a detailed good practices. National Payments Council, a methodology Resilience, Access to Finance and Growth in roadmap on Reform and Restructuring to assess the international remittance Iraq. This will be achieved by providing TA to of SOBs, strengthening of the National - No external financing for an ITAS is required ecosystem according to international the CBI to establish a Non-Banking Financial Payments ecosystem and advisory support as the MoF will secure that resource standards, and proposals to modernize the Institutions (NBFI) Unit and support to draft a on Financial Integrity through the National through regular budget processes. CBI payment system oversight framework. Law/Regulation on NBFIs to assist these firms Risk Assessment (NRA) on AML/CFT. The (including MFI) to access finance and improve - While broad tax administration reforms continuing dependence of a majority of 66. Regarding the National ML/TF Risk financial inclusion. are often linked to ITAS acquisitions, the Private Banks on a single revenue source Assessment, in 2020, the team had delivered elimination of paper-driven manual core (FX arbitrage) is a cause for concern and initial NRA training programs to eight NRA 68. Under the Housing Finance Advisory, the processes is an urgent priority for GCT. a potential financial stability risk as these Working Groups of Iraqi officials. Due to team is in the final stages of drafting a policy banks lack the capital to invest in systems, restrictions imposed following the pandemic, 70. The roadmap has been reviewed and note to support the GoI to develop sustainable operations and human capital to offer a broad the flow of the project was interrupted. In discussed with both the MoF and GCT during housing finance in the medium to long-term to range of products and services. 2021, the WBG delivered eight refresher a workshop held on July 28, 2021. The team address the diverse needs of the population NRA Training Programs to the eight NRA segment who do not have access to adequate is still engaged with the GCT and will provide 64. Under pillar 1, the deliverables related Working Groups: (1) ML Threats; (2) National housing and share experiences from other support until the finalization of the bidding to the support to the implementation of ML Vulnerabilities; (3) Banking Sector; (4) countries on approaches to housing finance in document signaling the acquisition of an ITAS. recommendations of the Financial Sector Insurance Sector; (5) Securities/Cap Mkts the context of reconstruction and developing This will all be within the framework of the Assessment Program Development Module Sector; (6) Other Financial Institutions/Sectors; sustainable long-term financing. The note Tax Administration Diagnostic Assessment (FSAP DM), are expected to focus on the (7) Designated Non-Financial Businesses/ will be a starting point for discussions with Tool assessment. reform strategy for state-owned banks and Professions; and (8) TF Risks. The team is in counterparts about structural reforms in the strengthening of banking sector licensing, continuous engagement with the FIU team/ the housing finance sector, and institutional regulation and supervision. These will be NRA Working Group who are collecting and reform in organizations such as the Real defined post-FSAP DM issuance. However, analyzing data/info from various sectors to Estate Bank of Iraq or the Housing Fund. The in 2021, the team maintained dialogue complete ML and TF threat and vulnerability team prepared a specific background paper with CBI, MoF, and the Higher Committee analyses. on housing finance under the FSAP DM which for State Bank Reform as a follow up to the 34 I3RF ANNUAL REPORT 2021 35 I3RF Results and Highlights 4.2.4 Adoption of the National Reform by the Secretary General of the Council of 4.3 PILLAR 3 — Agenda for Improving the Business Ministers and led by his deputy Dr. Farhad Environment in Iraq Nematullah Hussein. The Higher Committee COORDINATION AND Relates to the Results of the Project: Enabling is an inter-ministerial body who reports PROGRAM SUPPORT Environment For Small And Growing Businesses directly to his Excellency the Prime Minister (P171175) and composed by high government officials 76. This pillar aims to strengthen capacity and representing different government entities 71. This activity aims to improve the regulatory institutional arrangements for multi-stake- that plays an essential role in the areas of environment for firms, leveraging the holder dialogue, coordination, monitoring business environment. The Committee’s Business Environment framework, and and evaluation, and to improve the effective- mandate is to work on our proposals of focusing on areas in which Iraqi small and ness of reconstruction investments by Gov- legislative instruments, new policies, and growing businesses are most likely to face ernment, IBRD, and whenever possible, other development of new systems aimed at uncertainty, complexity, and obstruction. international partners. improving the business environment in the The project provides (i) advisory support country. for horizontal improvements in the overall business environment, including Doing 4.3.1 Monitoring the Impact of COVID-19 on 74. In the same year, the project produced a Policy Business reforms and beyond; (ii) advisory Note on Priorities for Small and Growing Iraqi Households and Businesses support to develop a policy agenda for Businesses and presented it to the MoF in Relates to the Results of the Projects: Building Evidence For Policy Making (P170264) and the small and growing enterprises; and (iii) August. The objective of this policy note is Social Protection And Jobs For Poor And Vulnerable technical assistance to implement selected to present the state of the private sector Iraqis (P171639) interventions based on this policy agenda. The and identify key stakeholders to provide work under this project led to the adoption of financing, in preparation for the design of a 77. Iraq faced the dual shock of the COVID-19 the Private Sector Chapter in the White Paper private sector fund. The policy note covers pandemic and a collapse of oil prices in 2020. which includes the National Reform Agenda the small and medium enterprises sector To monitor the impact on Iraqi households for improving the Business Environment in in Iraq and identifies policy and business and businesses in these turbulent times, and Iraq. environment reforms and interventions for provide relevant and urgent information to firms with innovative and growth potential all stakeholders, the WB initiated two sets of 72. In 2020, the activity produced 10 reform by providing (i) an overview of the sector rapid phone surveys in 2020 and 2021 . These memos covering Iraq’s business environment including a status description of supply and surveys leveraged expertise and collaboration and the National Agenda for Improving demand; (ii) gaps and obstacles assessment with the WFP and their infrastructure in Iraq. the Business Environment in Iraq which building on qualitative research and analysis; They were financed by the multi-donor Trust constituted the roadmap for reform and and (iii) proposed reforms and opportunities Fund for Statistical Capacity Building and included the activities, steps, timing, for firm growth. This policy note proposes the I3RF, as well as the Joint Data Center on responsibilities and resources needed for key fund characteristics to address the Forced Displacement. the implementation of each reform. Reform challenges and obstacles facing the private priorities were identified jointly with the GoI 78. The first set of surveys focused on monitoring sector. The fund will be developed to spur through a series of 10 virtual workshops. That the impact of COVID-19 on households, private sector growth and foreign investment same year, the project consulted with over running over nine months (August 2020 to by targeting firms with growth and innovation 200 main stakeholders in Iraq’s private sector January 2021, and June to August 2021), potential. Similar models have been applied and published a paper in the Iraq Economic including displaced persons. The findings in other countries in the MENA region such as Monitor titled “Laying the Foundation for a showed that the crisis severely impacted the Jordan, Lebanon, Morocco, Tunisia and Egypt. New Economy in Iraq: Digital Transformation”. economic wellbeing of Iraqis. Unemployment The policy note builds on data from virtual A series of five COVID-19 webinars spiked, particularly among the displaced, interviews and focus groups held in 2020. targeting 230 MSMEs were completed, and returnees and women jobseekers, and entrepreneurship intermediaries received 75. This BE activity is linked to an RE component persons who were self-employed or working capacity building, early-stage financing aiming to support 1,360 MSMEs to receive as informal wage workers prior to the crisis. workshops and business angel investing. financing through the project. This will Risks related to household food security improve the operations of four financial and access to healthcare and daily market 73. In 2021, the project supported the intermediaries, support 135 beneficiary increased. Moreover, only a small share of establishment of a new Higher Committee MSMEs to adopt new business solutions or school-aged children received any catch-up to lead the implementation of the National products, and mobilize US$4.35 million of or learning activities during school closures. Agenda for Improving the Business private capital through the project. As the economy slowly began to come out Environment in Iraq (former committee was of the depths of the crisis and open up again, dissolved last year). The Higher Committee these concerns eased, but remain elevated. was established by a decision in June 2021 The disproportionate impact of this dual shock 36 I3RF ANNUAL REPORT 2021 37 I3RF Results and Highlights on vulnerable groups, and its consequences and (iii) Piloting and mainstreaming citizen between contextual conflict-related risk 85. In relation to mainstreaming Citizen on child-learning and health care services be engagement approaches. information and more standard development Engagement, the team is currently supporting persistent, and impacts are likely to be felt for and vulnerability data. In light of this a series 3 different projects and is in discussions a long time. 82. In 2020, while the Peacebuilding and Citizen of stakeholder consultations took place over with others for possible support. The team Engagement Project had not formally July to September 2021 to identify existing is supporting the Transport Corridor Project 79. The second set of surveys focused on been launched in its entirety, a number of risk monitoring initiatives in Iraq, to learn (TCP) level communications and monitoring monitoring the impact of COVID-19 on activities to support the objective of the from the lessons of previous efforts to build platform, by developing a module to enhance businesses, running over three months I3RF peacebuilding and citizen engagement dashboards in other FCV contexts, and to Citizen Engagement processes. Under the (October to December 2020). The results cluster took place. These include: (i) A ensure that the dashboard would be tailored EODP, the team is providing technical support show that seven months into the pandemic, political economy analysis of Iraq’s budget to inform projects design. The pilot form of for the project’s grievance redress mechanism only half of surveyed firms in Iraq were processes that has informed the Bank’s the dashboard will be presented by the end and beneficiary surveys. In preparation operating their usual hours. Firms reported a dialogue and operations in the area of public of 2021 with plans to collaborate with the for the Country Climate and Development decrease in revenues and, to a lesser extent, in financial management reform; and (ii) a PTI, GEMS and P360 teams. In addition, two Report (CCDR) the team is providing technical demand for supplies. However, worker layoffs country-level analysis of fragility, conflict and learning events have been organized (i) on support for the design and implementation were less common. Firms reported significant political economy dynamics was conducted the political economy of the 2022 budget and of the stakeholder engagement process. The challenges in paying their utilities, rent and based on in-depth consultations with experts, (ii) on the outcome of the 2021 election. team is also in the process of delivering a loans. The top two coping mechanisms to use of a wide range of data sources and the dialogue event on climate change with civil this cash flow contraction have been dipping commissioning of dedicated background society as part of the Citizen Engagement into retained earnings and borrowing from papers (e.g., on the political economy of Iraq, efforts of the project. family and friends. Lastly, only a third of analysis of spatial inequalities). The analysis firms reported having started or increased was published as part of the Iraq Country online sales, with many reporting issues with Economic Memorandum (CEM) “Breaking out network reliability. While these challenges of Fragility”. are expected to have eased into 2021, the results highlight structural weaknesses in 83. In August 2021, an FCV risk monitoring Iraq’s private sector. framework aiming to guide monitoring activities was produced by a selected third- 80. The information gathered and analyzed party entity. In line with the framework, a through these activities can directly serve baseline assessment of risks was completed BOX 1: the recovery response to the pandemic which outlines the risk landscape as of THIRD PART Y MONITORING AGENT SUPPORT FOR WORLD BANK FINANCED and economic downturn and support the September 2021, and provides several risk PROJECTS IN IR AQ IN 2021 operationalization of the GoI’s White Paper. It pathways for how FCV may evolve in the can also serve as a valuable input into a more context of Iraq going forward. This baseline Third Party Monitoring Agent (TPMA) support for WB financed projects in Iraq (P174399) plays a key role long-term and sustainable data system for the risk assessment was followed by the first in increasing fiduciary and technical oversight, particularly in hard-to-access areas, and is a key tool to country. Microdata are released to the public monthly risk briefs, and the first quarterly strengthen fiduciary capacity to manage public funds with efficiency and integrity. through the WB Microdata Library and reports risk brief produced for September-November through the WB Knowledge Repository. 2021, which analyzed developments in key TPMA Support in Iraq at a glance 2021 risk areas, provided an outlook for the coming months, and identified potential implications Post-Site Visits Factsheets Monthly Reports Annual Reports 4.3.2 Promoting a Peacebuilding and Citizen for the WB. The purpose of this activity is to 103 16 1 Engagament Lens increase situational awareness of WB staff on Relates to the Results of the Project: salient developments in Iraq by monitoring Strengthening Peacebuilding, Governance and and analyzing on-going events and tensions, Citizen Engagement in Reform, Recovery and and informing the country team of emerging Reconstruction (P173326) risks. 81. This project aims to provide the analytical 84. The project also aims to create an online foundations and operational support to dashboard that will provide access to key promote peacebuilding across ongoing FCV manifestations (e.g. conflict incidents, and future WB interventions in Iraq. It is protests) and underlying risk drivers (e.g. structured around three components: (i) perception data on grievances over service Deepening understanding and analysis of delivery, economic opportunities). It will FCV dynamics; (ii) Operationalizing a “peace also integrate additional data sources (e.g. lens” to integrate peacebuilding, governance on poverty, forced displacement) to enable and political economy issues in the portfolio; users to make important cross-linkages 38 I3RF ANNUAL REPORT 2021 39 The I3RF Portfolio 05 THE I3RF PORTFOLIO COVID-19 RESTRICTIONS CONTINUE TO IMPACT I3RF OPERATIONS: 86. The COVID-19 pandemic has impacted the launch and implementation of several projects. The lockdowns, and inability to travel to or within Iraq has limited the ability of WB staff, consultants, contracted firms and Government counterparts to progress, as planned, on projects. However, with the easing of restrictions many local staff and consultants based in Iraq will be able to meet with Government counterparts and support implementation of projects. It is expected that in the coming year progress under the portfolio will pick up. Similarly, when international travel and in-country quarantine restrictions ease at the World Bank provided accommodations, many of the international staff should be able to travel more frequently to Iraq. I3RF RECIPIENT-EXECUTED ACTIVITIES UPDATE: 87. Three RE activities were able to have their grant agreements signed in 2021 and one is pending fulfilling the respective conditions to be declared effective. These are the (1) Strengthening Immunization Systems for Equitable and Quality Delivery of COVID-19 Vaccination through Third Party Monitoring – declared effective; (2) COVID-19 Adaptation and Recovery Pilot for MSMEs in Iraq – declared effective; and (3) Iraq Household and Socioeconomic Survey (IHSES) III. Several other RE projects are in the preparation and appraisal phase and are pending grant agreement signing by the MoF, before they can be considered effective, and work can begin. 40 I3RF ANNUAL REPORT 2021 41 The I3RF Portfolio TABLE 4: TABLE 5: ACTIVE PROJECTS 2021 PIPELINE PROJECTS 2021 Budget (US$) Budget (US$) Implementation Implementation Project Name Bank- Recipient- Project Name Modality Modality Bank- Recipient- Executed (BE) Executed (RE) Executed (BE) Executed (RE) Pillar 1: Socio-Economic Recovery and Reconstruction Pillar 1: Socio-Economic Recovery and Reconstruction 1.1 Area-Based Reconstruction in Mosul and Other Urban Centers 1.2 Agriculture, Natural Resources and Water Area-Based Reconstruction in Mosul and Other Urban Centers BE 2,000,000 Support to Manage Environmental Pollution Hotspots in in Iraq RE 5,000,000 Iraq 1.2 Agriculture, Natural Resources and Water Revitalizing the Agriculture Sector in Iraq BE 1,500,000 Support for Improved Farm Management RE 5,000,000 Support to Manage Environmental Pollution Hotspots in Iraq BE 1,000,000 1.3 Human Capital and Employment Water Supply and Sanitation Utility Reform Technical Innovations Towards Learning in Lagging Iraqi BE 1,750,000 RE 10,000,000 Assistance Governorates* Technical & Economic Due Diligence to Support Iraq Southern BE 200,000 Support to Tertiary Education in Iraq RE 5,000,000 Region Electricity Network Reinforcements 1.3 Human Capital and Employment Protecting and Promoting Human Capital in Iraq - The BE/RE 600,000 4,400,000 Economic Inclusion Pilot Support to Education and Skills Development in Iraq BE 1,500,000 Iraq Road Maintenance Microenterprises Grant Project RE 5,000,000 Support to Tertiary Education in Iraq BE 1,000,000 Social Protection and Jobs for Poor and Vulnerable Iraqis BE 1,450,000 Pillar 2: Economic Diversification and Private Sector-Led Growth COVID-19 Response and Health System Strengthening BE 5,000,000 2.1 Economic Diversification and Transformation Strengthening Immunization Systems for Equitable and Debt Management for Recovery and Development** RE 3,000,000 Quality Delivery of COVID-19 Vaccination through Third Party RE 2,000,000 Monitoring Pillar 3: Coordination and Program Support Pillar 2: Economic Diversification and Private Sector-Led Growth 3.2 Evidence and Data on Poverty, Vulnerability and Displacement 2.1 Economic Diversification and Transformation Iraq Household and Socioeconomic Survey (IHSES) III BE/RE 610,000 4,360,776 Economic Diversification and Growth BE 1,800,000 * Name changed from Innovation toward Learning in Iraq through a Community Approach to Mitigate Learning Loss 2.2 Financial Sector Reforms **Please note that this project might incur implementation modality changes Iraq Financial Sector BE 2,400,000 Analytics and Advisory for Management of Public Resources BE 2,000,000 and Fiscal Federalism 88. Two projects under the I3RF portfolio were 2.3 Enabling Environment for Small and Growing Businesses endorsed as part of the initial Work Plan in Enabling Environment for Small and Growing Businesses BE 2,200,000 May 2019 but are being re-discussed with 2.4 Enabling Environment for Small and Growing Businesses MoP to confirm their validity: (i) Strengthening Planning, Coordination and Monitoring of COVID-19 Adaptation and Recovery Pilot (CARP) for MSMEs in RE 15,000,000 Reconstruction Efforts, and (ii) Peacebuilding Iraq and Citizen Engagement – RE. Pillar 3: Coordination and Program Support 3.2 Evidence and Data on Poverty, Vulnerability and Displacement Building Evidence for Policy Making BE 1,000,000 3.3 Enhanced Supervision, Fiduciary and Risk Management Fiduciary Oversight and Capacity Strengthening (includes Strengthening Financial Management and Procurement BE 4,300,000 Capacities; and Third Party Monitoring Agent) 3.4 Peacebuilding and Citizen Engagement Strengthening Peacebuilding, Governance and Citizen BE 1,200,000 Engagement in Reform, Recovery and Reconstruction 42 I3RF ANNUAL REPORT 2021 43 Operational Updates 6.1 THE RESULTS FRAMEWORK 89. The Results Framework is a living document which is regularly updated as the portfolio of the I3RF evolves and as projects become 06 effective. FIGURE 2: THE I3RF THEORY OF CHANGE OPERATIONAL I3RF DEVELOPMENT OBJECTIVE: UPDATES Advance the Reform, Reconstruction and Development of Iraq PILLAR 1 PILLAR 2 PILLAR 3 Socio‑Economic Economic Diversification and Coordination and Program Recovery and Reconstruction Private Sector-led Growth Support Development Objective: Development Objective: Development Objective: Improved Improved/Enhanced Improved economic multi-stakeholder coordination and Socioeconomic Recovery and diversification and programming on reform, recovery, Infrastructure Redevelopment strengthened financial sector and reconstruction efforts Improved Area-based Enhanced Economic Strengthened Reconstruction Planning Diversification Planning, Coordination, and Monitoring of Reconstruction Efforts Improved Infrastructure, Improved Fiscal Environment and Natural Management and Financial Resources Services and Sector Improved Evidence Coordination and Data on Poverty, Vulnerability and Displacement Enhanced Enabling Strengthened Human Environment for Businesses Capital Development and Employment Enhanced Supervision, Fiduciary and Risk Management Improved Peacebuilding and Citizen Engagement Efforts 44 I3RF ANNUAL REPORT 2021 45 Operational Updates 6.2 THE OPERATIONS MANUAL AND THREE REPRESENTATIVES 95. In support of the GoI in adressing the COVID-19 Vaccine Hesitancy. The meeting COVID-19 pandemic, the project of “COVID-19 was attended by MoP, MoHE, I3RF donors, the TO THE STEERING COMMITTEE Response and Health System Strengthening” WB project team, and I3RF Secretariat. This was endorsed by the I3RF Steering Committe exchange has prompted more coordination 90. In September 2021, the I3RF’s operations arrangement that was originally included in for a budget of US$5,000,000. The project and support from stakeholders to maximize manual was updated in consultation with the operations manual but was not applied. began implementation in August 2020 in efficiency and support Iraq to overcome the MoP and I3RF donors. The updates were The I3RF Secretariat re-established contact close cooperation with MoHE. The two COVID-19 crisis. endorsed at the 7th Steering Committee with the UN resident coordinator and MoP key components of the project focus on the COVID-19 emergency response and 96. Going forward, the I3RF aims to strengthen the meeting and the changes were circulated nominated one private sector representative improving access to quality healthcare reach and diversity of its discussion series with to all partners and the Government, in both to join Steering Committee meetings as services. A discussion session was organized a focus on citizen engagement, peacebuilding, Arabic and English. An important change to observers/non-voting partners. MoP also to discuss the GoI response and issues faced climate change and the environment, gender note is the inclusion of external partners in nominated a focal person from MoF to join in the health sector. The technical teams also equality and women’s empowerment in order Steering Committee meetings of the I3RF, an Steering Committee meetings going forward. provided a progress update on this project to inform the policy debate around Reform, and the findings of the Facebook Survey on Recovery and Reconstruction in Iraq. 6.3 BRANDING AND COMMUNICATIONS 91. In collaboration with the MoP, the I3RF the phased approach that will be adopted to TABLE 6: secretariat has developed an operational implement the strategy efficiently, timeously, TECHNIC AL AND THEMATIC DISCUSSIONS HELD IN 2021 strategy for communication which was and with consideration for the country Thematic Discussions officially approved by the MoP on November context. In parallel, the visual identity of the 8, 2021. It identifies the different target Fund has been finalized in close consultation Climate Change and the Environment (May 24, 2021) audiences with the relevant channels and with the MoP Media and Communications Iraq COVID-19 Response and Health System Strengthening Project (May 26, 2021) tools, covers the objectives of the strategy and Department. its main messaging themes, and highlights The Civil Society Consultation and Dialogue on Climate Change in Iraq (Decmber 20, 2021) Technical Discussions Innovations Towards Learning in Lagging Iraqi Governorates (January 26, 2021) 6.4 LAUNCH OF THE I3RF THEMATIC DISCUSSION SERIES Energy and Extractives: Technical & Economic Due Diligence to Support Iraq Southern Region Electricity Network Reinforcements (January 27, 2021) 92. The I3RF Thematic Discussion Series was 94. Iraq is highly vulnerable to the impacts launched in 2021 and three thematic of climate change (droughts, heat waves/ Enabling Environment for Small and Growing Businesses (January 29, 2021) technical discussions were held as part of stress, floods, sea level rise) and this Iraq Household and Socioeconomic Survey (IHSES) III (February 9, 2021) the I3RF’s role as a platform for coordinated has consequences for human capital financing and dialogue on Reform, Recovery development, water and agriculture. In light Economic Inclusion Pilot (EIP) (February 10, and June 3, 2021) and Reconstruction. These sessions were held of this, the I3RF organized a discussion session Economic Diversification and Growth – discussion between MoP and WB team (June 30, 2021) & with donors as part of the I3RF Thematic Discussion Series in May, 2021 entitled “Climate Change and (August 31, 2021) in cooperation with the Steering Committee, the Environment in the Mashreq and Iraq”. relevant line ministries and UN agencies. The sesssion was co-chaired by MoP and the The Iraq Household and Socioeconomic Survey (IHSES) III – discussion between MoP and WB team (July 12, 2021) The I3RF Thematic Discussion Series provide World Bank, in collaboration with MoHE, and & with donors (August 2, 2021) a space for knowledge sharing, exchanging aimed to discuss and identify a roadmap of Strengthening Immunization Systems for Equitable and Quality Delivery of COVID-19 Vaccination through Third best practices, facilitating discussion and actions that Iraq can take to mitigate and Party Monitoring (TPM) (August 23, 2021) developing national agendas. The sessions adapt to climate change. It was also attended Support to Education and Skills Development in Iraq – Additional Financing (September 7, 2021) were held virtually due to COVID-19 and by I3RF donors, national government brought together GoI counterparts, I3RF institutions, humanitarian and development Economic Diversification and Growth – coordination meeting with GIZ (September 15, 2021) donors, development and humanitarian partners, and WB technical experts. The partners and experts from the WB. meeting highlighted the importance of focusing on the vulnerable groups affected by 93. In 2021, the I3RF increased its focus on two the compounded crisis, and stressed the need thematic areas in response to national needs: for a more coordinated response to reduce Climate Change and the Environment and the the impacts of climate change in all sectors COVID-19 Response. in support of Iraq’s National Determined Contributions (NDCs). 46 I3RF ANNUAL REPORT 2021 47 Operational Updates 6.5 CLIMATE CHANGE AND THE ENVIRONMENT IN THE I3RF PORTFOLIO Details on the contribution to climate change and the environment per project can be found in Annex 3 – Progress Overview Per Project 97. Through its three pillars of engagement, the produced to inform climate change and I3RF is mainstreaming climate considerations environment programming. The CCDR is a into existing and future projects that seek new core country analytics product, done in to contribute to Iraq’s reform, recovery, and consultation with GoI, private sector, experts reconstruction. The I3RF will support the and civil society organization, that will climate agenda through (i) mainstreaming help identify and inform opportunities for climate change and environment in climate action by the public and the private its portfolio by focusing on mitigation sector, so that Iraq‘s development goals can and adaptation and (ii) supporting data be achieved in the context of sustainability. collection, knowledge sharing and dialogue The CCDR is intended to complement and around Climate Change and the Environment be coordinated with other country core in Iraq. As part of this, I3RF has identified analytics. The objective and focus of the ongoing operations/activities in its portfolio CCDR is to capture the interplay between with climate change mitigation/adaptation each country’s development goals and potential and has integrated reporting climate change, in the context of the Paris climate change related Co-Benefits from Agreement and the GoI, the WBG and other relevant sector teams. development partners‘ commitment to align their portfolios to its objectives. The CCDR will 98. Iraq was identified as the most vulnerable analyze how the country’s development goals country to climate change in the MENA can be achieved in the context of mitigating Region3. Increasing temperatures, decreasing and/or adapting to climate change. It is precipitation, droughts and desertification, expected to be an analytical piece, based on and other extreme phenomena are impacting rigorous data, analysis, and research. CCDRs human health and key sectors such as water will also consider and reflect the country’s and agriculture, and undermining efforts commitments as embedded in their NDCs to decrease poverty and increase shared or longer-term domestic and international prosperity. Iraq has, through its intended commitments, and identify ways to support NDCs, committed to prioritize climate action implementation through public and private in water, coastal areas, forest and land use sector solutions. sectors. For Iraq to fully recover and rebuild from current conflicts, robust measures to 101. A discussion session was organized as part reduce climate risks and enhance resilience of the I3RF Discussion Series on May 24, of the already fragile and most vulnerable 2021 entitled “Climate Change and the communities and sectors is critical. Environment in the Mashreq and Iraq”(For more information, cf. Section on the Launch of 99. The GoI has demonstrated a strong the I3RF Discussion Series). I3RF is also working commitment to climate action and its closely with WBG’s task team preparing NDCs3, and the I3RF is working alongside ‘Country Climate and Development Report the Government to strengthen collaboration (CCDR)’ for Iraq. More details on climate and coordination among key stakeholders change and environment contributions per for efficient, appropriate and sustainable project are found in the Progress Overview solutions. per Project annex of this report. 100. Iraq has recently been added to the list of countries in which a Country Climate and Development Report (CCDR) will be 3 Nationally Determined Contributions of Iraq on Climate Change. Link 48 I3RF ANNUAL REPORT 2021 49 Operational Updates TABLE 7: agriculture index (WEAI) adjusted to the Iraqi owned businesses. In the financial sector, the I3RF CONTRIBUTION TO IR AQ’S NATIONALLY DETERMINED CONTRIBUTIONS context, a gender-differentiated impact of work being carried out on liquidity support for COVID-19, and moving towards gender parity the microfinance sector and on development List of I3RF Projects Contributing* to the NDCs of Iraq in the agricultural sector by piloting WEAI. of a NFIS is an opportunity to improve finance 1. Area-Based Approach in Mosul and Other Urban Centers in Iraq WEAI can measure women’s empowerment available to women-owned businesses, and and inclusion in the agricultural sector and financial inclusion for women, and is intended 2. Revitalizing the Agriculture Sector in Iraq inform policy. WEAI was launched by IFPRI, to improve women’s control of assets. The 3. Support for Improved Farm Management the Oxford Poverty and Human Development Economic Inclusion Pilot (EIP) also contributes Initiative (OPHI), and USAID’s Feed the to the economic inclusion of women and it 4. Support to Manage Environmental Pollution Hotspots in Iraq Future in February 2012, and was the first expects 45 percent of its beneficiaries to be 5. Iraq Road Maintenance Microenterprises Grant Project comprehensive, standardized measure of females. Collaboration with the MGF on this women’s empowerment and inclusion in the aspect is ensured. *Directly or Indirectly agricultural sector. 109. In the support to poverty targeting and 107. In the health sector, activities are ensuring programming, the upcoming labor-force- that the needs of Iraq’s women and girls are survey, I-WISH and IHSES-III will produce 6.6 GENDER EQUALITY AND WOMEN’S EMPOWERMENT IN THE addressed. The development and costing of data that allows for a better understanding of I3RF PORTFOLIO a primary healthcare package of services gender gaps across development outcomes. will prioritize reproductive health, maternal IHSES-III is designed to measure various Details on the contribution to Gender Equality and Women’s Empowerment per project and child health, mental health, psychosocial welfare indicators by gender. Therefore, the can be found in Annex 3 – Progress Overview Per Project support, and gender-based violence activity will strengthen the evidence-base interventions. The assessment and redesign for interventions targeting women, both 102. In 2020, the I3RF assessed its portfolio to women’s economic inclusion through the of patient flow at health facilities under generally and in the context of the pandemic. ensure that a strong focus on promoting activities identified by the I3RF projects. Component 1 will help reduce disruptions The CEQ-light will reveal the distributional gender equality and advancing women’s The I3RF Secretariat, with the support of the caused by COVID-19 to essential services impacts of fiscal policies on women in empowerment is maintained across projects. MGF, is collaborating with sector teams on such as maternal and reproductive health. Iraq. The activities also contribute to the The Fund aims to ensure that activities the integration of gender considerations in All analytical work and any M&E framework improvement of the targeting of poor female- financed through the I3RF (i) provide more project design and implementation. developed through the project will have headed households in Iraq. space for women and girls to benefit equally gender disaggregated indicators and targets from the opportunities and resources made 104. Active projects under the I3RF are contributing 110. More details on the gender dimension per where applicable. available through the Fund; (ii) improve the to gender equality and the empowerment of project is available in the Progress Overview collection of data and analysis to identify women and girls through technical assistance, 108. The Economic Diversification and Private Per Project annex of this report. The I3RF gender gaps, measure gender-disaggregated improving policy-relevant data, improving Sector-led Growth pillar mainstreams gender Secretariat will keep partners informed on data, where relevant; and (iii) support laws and capacity building. in financial sector reforms and the CARP, and the status of this dimension under the Fund. activities which contribute to closing the incorporates activities supporting women- 105. In the education sector, gender-nuanced gender gap. learning interventions based on the findings 103. The I3RF Secretariat is working with of the SDI, PER and INES are expected to the Mashreq Gender Facility (MGF) on benefit girls and women. Collecting data on supporting existing and upcoming I3RF learning outcomes under the SDI, will enable projects in addressing gender gaps through the GoI to analyze these outcomes against 15 Contributing to Economic their activities, and ensuring women benefit measures of equity (including gender) and Empowerment of Women equally from the implemented projects. to make strategic, cost-effective decisions and Girls A series of discussions were held with the to support marginalized and vulnerable different teams involved in May 2020 in order groups, among whom are girls. In addition, 13 the Recipient-Executed education projects Contributing to to align visions and agree on action points. Improving Data The I3RF Secretariat, in coordination with under the Fund will further support evidence- on Gender sector teams, has collected more granular based education policies by generating data on the gender gaps identified and gender-disaggregated data and addressing addressed through the projects to allow for the unemployment of females with tertiary TABLE 8: education. an easier follow up on this mainstreamed GENDER EQUALIT Y AND dimension. All new projects proposed to the Contributing to WOMEN’S EMPOWERMENT 8 106. In the agriculture sector, the I3RF in Improving Laws Fund are required to report with a higher collaboration with the MGF, will contribute IN THE I3RF and Policies level of detail on their contribution to closing to developing a women’s empowerment in Affecting Women (Active and Pipeline) identified gender gaps and empowering 50 I3RF ANNUAL REPORT 2021 51 Financial Highlights TABLE 9: I3RF FINANCIAL HIGHLIGHTS 2021 Financial Highlights (All figures in millions) Funds Committed by Development Partner(s) Period Ended December 31, 2021 Germany US$60.50 The United Kingdom US$47.36 Canada US$10.93 Sweden US$4.61 Funds Received from Development Partner(s) Germany US$48.63 The United Kingdom US$31.10 07 Canada Sweden US$10.93 US$3.51 Investment Income Credited US$1.23 Total Fund Available US$95.40 Total Funds Committed* FINANCIAL HIGHLIGHTS Bank-Executed Trust Funds US$28.90 Recipient-Executed Trust Funds US$26.36 Funds set aside for contingency purposes US$6.00 111. The I3RF was established administratively Funds for project preparation, Technical Disbursements in November 2018 and the total in donor Assistance, Analytics and Advisory and contributions pledged from Canada, Germany, COVID-19 response. By December 31st, 2021 Bank-Executed Grants US$13.30 Sweden and the UK is US$123.40 million, of the I3RF had disbursed US$13.30 million, Recipient-Executed Grants US$0.00 which US$94.17 million has been paid, with under active Bank-Executed Trust Funds. outstanding contributions of US$29.23 million There have been implementation delays and Recipient-Executed Grants *(Fee component) US$0.85 to be received by the Fund in 2022 and 2023 lower than expected disbursement due to the Cash balance US$19.99 as per the contribution schedule agreed upon continuing impact of the COVID-19 pandemic in the Administration Agreement with donors. and delays in signing RETF Grant Agreements. *As per the approved Grant Funding Requests in the system. Sweden became a new donor in 2021 for a total contribution of US$4.61 million of which 114. The Fund also has a pipeline of projects for US$42.97 million with US$1.21 million for US$3.51 million has been received. TABLE 10: I3RF INDIC ATIVE BUDGET AND ACTUAL DISBURSEMENT 2021 Bank-Executed Trust Funds and US$41.76 112. The Fund has earned US$1.23 million in million for Recipient-Executed Trust Funds; Indicative Budget and Actual Disbursements (All figures in millions) investment income4 which is considered Projects will be approved as per Bank Bank-Executed Activities & Recipient Executed Activities Indicative Budget* Period Ended December 31, 2021 part of the contribution and used to manage policies and procedures and in line with the the I3RF and finance Bank-Executed and prioritization and sequencing mechanism of Program Management and Administration** US$6.75 US$2.54 Recipient-Executed Trust Funds. The the Fund. Coordination and Program Support Window US$11.47 US$1.48 Fund has also charged US$0.85 million as administrative fee for Recipient- Executed 115. As per the decision of the I3RF Steering Economic Diversification and Private Sector‑Led Growth US$26.4 US$3.88 Trust Funds. Committee on the 17th of June 2020, the I3RF Window set aside an unallocated amount of US$6 Socio Economic Recovery and Reconstruction Window US$52.4 US$5.40 113. In 2020, grants were approved for a total of million to support the GoI in projects related US$8.32 million under the Fund, including to emerging priorities. Total  US$97.02 US$13.30 US$6.36 million in Recipient-Executed Trust *The Indicative Budget is based on the latest endorsed Work Plan. The numbers will be updated based on the endorsed changes in the upcoming Steering Committee meeting. For more details on the financials of the I3RF, kindly 4 Investment income consists of the modified cash basis trust funds’ allocated share of the following: interest income visit the Development Partner Center. earned by the pool, realized gains/losses from the sale of securities, and unrealized gains/losses resulting from recording the assets held by the pool at fair value. ** This includes the I3RF Project Preparation and Implementation Support 52 I3RF ANNUAL REPORT 2021 53 Looking Ahead 08 LOOKING AHEAD 116. The calendar year 2021 ended with the signing of three RE activities from the I3RF portfolio and it is expected that in the coming year these activities will advance in their implementation leading to an increase in disbursements. The intention is to prioritize RE activities which are strategic priorities for the GoI and which support the implementation of reforms as outlined in the White Paper. BE support to the GoI will continue to inform and support the implementation of priority programs and the White Paper of Iraq. To ensure strong ownership by the GoI in the selection of I3RF programs, it was agreed that new projects or analytical works to be financed under the I3RF will first be reviewed and put forward by the MoP to the I3RF Steering Committee for consideration. Following this, a technical session will be held to discuss technical details with the MoP, relevant line ministries, I3RF donors, and other relevant stakeholders working on similar activities in Iraq. The proposals will then be considered for endorsement at the Steering Committee meeting which will continue to be organized on a quarterly basis. 54 I3RF ANNUAL REPORT 2021 55 ANNEX 1 – I3RF RESULTS INDICATORS FOR 2021 56 I3RF ANNUAL REPORT 2021 Annex 1 – I3RF Results Indicators for 2021 This table reports on the results of the I3RF as per the Results Framework. The Results Framework is currently being discussed with MoP and partners and will be updated regularly. For more details on the deliverables reported on in the table below, please refer to the Results and Highlights section or to the Progress Overview per Project in the Annex. For more details on deliverables achieved in 2020, please refer to the I3RF Annual Report for 2020 - Annex 1. Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved Pillar: Socio-economic Recovery and Reconstruction Outcome: The preparation and implementation of socio-economic recovery and reconstruction programs are enhanced through analytic support, innovative pilot programs and targeted co-investments with IBRD financed lending operations Number of analytical 2 14 Exceeded (15) 1. Area-Based Approach for Reconstruction in Mosul and Other Urban Centers in Iraq - Stakeholder works (studies, Mapping assessments, and/ or policy guidance) 2. Area-Based Approach for Reconstruction in Mosul and Other Urban Centers in Iraq - Climate Risk Review completed as basis for 3. Social Protection & Jobs for Poor and Vulnerable Iraqis - Short Term Impact of COVID-19 on Enterprises in recovery, reconstruction Iraq (July 2021) and development investments – per year 4. Water Supply and Sanitation Utility Reform Technical Assistance - Iraq Water Resources Planning and Investment Analysis 5. Water Supply and Sanitation Utility Reform Technical Assistance - Roadmap for the Digital Transformation of WSS Delivery 6. Revitalizing the Agriculture Sector in Iraq - 4 Biweekly Reports 7. Revitalizing the Agriculture Sector in Iraq - 1 Quarterly Food Security Monitor 8. Revitalizing the Agriculture Sector in Iraq - Policy Paper in the Agrifood Sector in Iraq 9. Support to Manage Environmental Pollution Hotspots in Iraq - Satellite Mapping of 77 Hotspots 10. Support to Manage Environmental Pollution Hotspots in Iraq - Priority Sites Identified for Detailed Mapping 11. Support to Education and Skills Development in Iraq - National Education Strategy (December 2021) 12. Support to Education and Skills Development in Iraq - Education Reform Plan (July 2021) 57 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved Number of Area N/A 2 Achieved (2) Area-Based Approach for Reconstruction in Mosul and Other Urban Centers in Iraq - Assistance to prepare Based Approach plans investment plans for Anbar and Nineveh (funded by EODP) which are inclusive and follow an Area-Based prepared by Project Approach to reconstruction Management Teams (PMTs) - per year Capacity of Ministry of N/A Yes Achieved (yes) Support to Manage Environmental Pollution Hotspots in Iraq - Intermediate target: Conducted a Health and Environment comprehensive eight module training for 30 officials at the Ministry of Environment (April 2021) improved to identify and prioritize investments for the remediation of environment pollution hotspots in Iraq Strategic Framework N/A Yes Delayed Support to Manage Environmental Pollution Hotspots in Iraq - This has been delayed. Due to the COVID-19 developed for pandemic and security concerns, field work was halted from 2020 until mid 2021 - the project has been remediation of extended to December 2022 environment pollution hotspots in Iraq Number of water utilities N/A No target Exceeded (2) Water Supply and Sanitation Utility Reform Technical Assistance – No results were expected for 2021; with improved financial the following intermediate targets were achieved - Phase 1 completed: Implementation of: 1. customer viability (assessed based relations management and; 2. billing system at BWA and BWD on improved service provider operating- cost coverage ratio, in percent) - cumulative Bank Energy team N/A 1 Delayed – Technical & Economic Due Diligence to Support Iraq Southern Region Electricity Network Reinforcements - to complete a Undergoing A first draft of the report has been completed and is undergoing further review and discussion. comprehensive technical Finalization and economic analysis report National COVID-19 N/A Yes Achieved (yes) COVID-19 Response and Health System Strengthening - NVDP was developed Vaccination and Deployment Plan (NVDP) developed 58 I3RF ANNUAL REPORT 2021 Annex 1 – I3RF Results Indicators for 2021 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved Number of Facebook N/A 2 Achieved (2) COVID-19 Response and Health System Strengthening - 1. Facebook survey on vaccine hesitancy and 2. surveys to assess Online A/B testing to identify effective communication messages using Facebook COVID-19 vaccine hesitancy - per year Pillar: Economic Diversification and Private Sector-led Growth Outcome: The design and implementation of GoI reforms to strengthen economic diversification and private-sector-led growth is enhanced through capacity building, technical assistance and knowledge/analytical work Number of analytical 2 6 Exceeded (10) 1. Iraq Financial Sector - Presentation of best practices and country cases on supervision and oversight of works (studies, payments system assessments, and/ or policy guidance) 2. Iraq Financial Sector - Presentation of digital payment incentives policy options completed to inform 3. Iraq Financial Sector - High level assessment of remittance market reform agenda - per year 4. Iraq Financial Sector - High level assessment of the CBI Business Continuity Plan 5. Iraq Financial Sector - Technical note on housing finance 6. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Public debt management guidance notes 7. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Tax administration reform policy note 8. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Oil revenue management policy note 9. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Policy note on recruitment practices 10. Enabling Environment for Small and Growing Businesses - SME policy note Number of regulations 1 2 Achieved (2) 1. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Public debt and/or reform plans management regulation that facilitate economic diversification and 2. Enabling Environment for Small and Growing Businesses - The adoption of Private Sector Chapter in the improve public finances White Paper which includes the National Reform Agenda for improving the Business Environment in Iraq adopted by Cabinet or Ministry informed by I3RF support - per year 59 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved Number of 230 270 Delayed in 2021 Enabling Environment for Small and Growing Businesses - The project overachieved last year, exceeding its entrepreneurs receiving – this indicator 2020 target (20 entrepreneurs) by approximately 12 times. The focus of the project has shifted this year to support through access exceeded complete the SME Policy Note to market, capital and its target networks – cumulative of 2020 by approximately 12 times Pillar: Coordination and Program Support Outcome: Institutional mechanisms and capacities for multi-stakeholder dialogue, coordination, and monitoring of reform and reconstruction priorities are enhanced; and the social, gender, and peacebuilding dimensions of recovery and reconstruction programs are strengthened. Number of Government 1 2 Exceeded (3) 1. Building Evidence for Policy Making - Interim poverty map and targeting formulae used for the Human program and World Capital Cash Transfer pilot in Kurdistan Region of Iraq (KRI) Bank operations using new data sources and 2. Building Evidence for Policy Making - Interim poverty map, poverty projections, and results from phone analytics for design and surveys are used for the Primary Education Project monitoring, including the COVID-19 responses and operationalization of the Iraq Reform Agenda – cumulative Number of analytical 2 3 Achieved (3) 1. Building Evidence for Policy Making - Two high frequency phone survey reports were produced (August works on poverty and 2020 to January 2021, and June-August 2021) vulnerability/gender dimensions/impacts 2. Building Evidence for Policy Making - Update of poverty projections after the devaluation of the Iraqi of COVID-19 pandemic Dinar was completed completed - per year 3. Building Evidence for Policy Making - The updated Poverty Map is being used to better target Government and World Bank Programs, and COVID-19 emergency programming. (2020) Number of projects 2 3 Achieved (3) 1. Third Party Monitoring Agent - EODP covered by Third-Party Monitoring services – 2. Third Party Monitoring Agent - SFD cumulative 3. Third Party Monitoring Agent - COVID-19 TPMA 60 I3RF ANNUAL REPORT 2021 Annex 1 – I3RF Results Indicators for 2021 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved Number of analytics 2 3 Exceeded (4) 1. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and completed to Reconstruction - Risk monitoring framework (August 2021) understand the political economy, inclusion and 2. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and peacebuilding aspects Reconstruction - Baseline assessment of risks (September 2021) of reform, recovery and 3. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and reconstruction – per year Reconstruction - Monthly risk briefs 4. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction - Quarterly risk brief Number of projects 2 Achieved (2) 1. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and benefitting from Reconstruction - Transport Corridor Project enhanced citizen engagement/ grievance 2. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and redress mechanisms - Reconstruction - EODP per year Pillar: I3RF Operating Model Outcome: The I3RF serves as a mechanism to influence or leverage existing or new funding for reform, recovery and reconstruction Number of WBG 6 10 Exceeded (13) 1. Building Evidence for Policy Making - Human Capital Cash Transfer pilot in KRI investments benefitting from I3RF co-financing 2. Building Evidence for Policy Making - Primary Education Project or technical support – 3. Technical & Economic Due Diligence to Support Iraq Southern Region Electricity Network cumulative Reinforcements - Ongoing design of a lending operation in the energy sector 4. Revitalizing the Agriculture Sector in Iraq - Ongoing design of an investment project financing the agriculture sector 5. Analytics and Advisory for Management of Public Resources and Fiscal Federalism – Public Financial Management Modernization Project 6. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Strengthening Fiscal Accountability and Oversight Institutions 7. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction - TCP 61 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved 8. Area-Based Approach for Reconstruction in Mosul and Other Urban Centers in Iraq; Support to Education and Skills Development in Iraq; and Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction - EODP 9. Water Supply and Sanitation Utility Reform Technical Assistance - Baghdad WSS 10. ESSRP (2020) 11. SFD (2020) 12. National Financial Inclusion Development (Iraq MSME Facility 2.0) (2020) 13. KRI Emergency Response Operation (2020) Outcome: The I3RF provides a platform for enhanced coordination and dialogue between donors and Government Economic policy Yes Yes Achieved Economic Diversification and Growth - The impact of the CEM and White Paper on the Reform paper of the reform matrix agreed GoI with Government and consulted with donors Number of knowledge 19 20 Exceeded (62) 1. Area-Based Approach for Reconstruction in Mosul and Other Urban Centers in Iraq - Training under the sharing or learning Area-Based Approach for Reconstruction project (January 2021) activities or events to disseminate I3RF 2. Revitalizing the Agriculture Sector in Iraq - Enabling Iraq’s food system contributions to employment, analytical work and/or growth, and resilience to shocks (April 2021) lessons learned – per 3. Revitalizing the Agriculture Sector in Iraq - Online Seminar: Food Security and Food Systems in Iraq year 4. Revitalizing the Agriculture Sector in Iraq - E-learning on remote sensing technologies 5. Support to Manage Environmental Pollution Hotspots in Iraq - Eight trainings for officials at Ministry of Environment (April 2021) 6. COVID-19 Response and Health System Strengthening - Seventeen trainings events in the health sector: 1. Oxygen safety in healthcare settings; 2. Introduction and Vaccination strategies; 3. Vaccine Financing; 4. Procurement and Distribution Networks ; 5. Supply Chain Readiness; 6. Vaccine Administration & Follow- up: The Beneficiary Journey; 7. Costing & Human Resources; 8. Thinking to the Future; 9. Building vaccine confidence; 10. Deploying multiple vaccines using a portfolio approach; 11. Engaging private sector in vaccine delivery; 12. Four workshops on the use of different digital platforms for contact tracing (DHIS2, ComCare, OpenSRP, GO.DATA); 13. Two workshops on COVID-19 testing for frontline laboratory technicians 62 I3RF ANNUAL REPORT 2021 Annex 1 – I3RF Results Indicators for 2021 Indicator 2020 Results 2021 Target Status & Results Project Name, Result and Date Achieved Achieved 7. Support to Education and Skills Development in Iraq - Education PER launching event (May 31 – June 1, 2021) 8. Support to Education and Skills Development in Iraq - Education Reform Plan Disseminated 9. Economic Diversification and Growth - CEM dissemination event 10. Economic Diversification and Growth - CEM presentation at Georgetown University 11. Economic Diversification and Growth - CEM dissemination at development partners forum in Baghdad 12. Economic Diversification and Growth - CEM targeted session with Iraqi academics 13. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Political Economy of the 2021 budget in Iraq 14. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Post-2021 legislative election diagnostic of political economy challenges 15. Analytics and Advisory for Management of Public Resources and Fiscal Federalism - Four learning events for the State and Shura Councils with the Egyptian and French State Councils 16. Enabling Environment for Small and Growing Businesses - Two dissemination events for the public and private sectors for the National Agenda for Improving the Business Environment in Iraq 17. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction - Event on the political economy of the 2022 budget 18. Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction - Event on the outcome of the 2021 election 19. Iraq Financial Sector - Two virtual workshops with CBI 20. Iraq Financial Sector - Three workshops on Fast Payment Systems; National Payments Council; and International Remittances (December 2021) 21. Iraq Financial Sector - Six virtual workshops with NRA working groups 22. Iraq Financial Sector - Six refreshers to NRA Working Group 63 ANNEX 2 – LIST OF PROJECTS WITH DETAILS ON GOVERNMENT ENGAGEMENT 64 I3RF ANNUAL REPORT 2021 Annex 2 – List of Projects with Details on Government Engagement This table provides per project details on government counterparts, I3RF engagement with them, and the type of support provided by the Fund. The information is aggregated from the detailed progress template published in the annex under Progress Overview Per Project. Further details on projects can be found in the Results and Highlights section and in the Progress Overview per Project annex. Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Pillar 1: Socio-Economic Recovery and Reconstruction Area-Based Active Reconstruction Fund for Ministries have been involved and briefed, and training has been Technical Refer to Results and Reconstruction in Mosul Areas Affected by Terrorist conducted in coordination with ReFAATO and Project Management Assistance, Highlights section and Other Urban Centers Operations (ReFAATO), Teams Advisory Support and Annex 3 – in Iraq – BE activity Governorates Project and Analytics Progress Overview (P162875) Management Teams, Per Project Ministry of Planning, Ministry of Finance Revitalizing the Active Ministry of Agriculture The team is organizing joint EODP and I3RF supervision and Technical Refer to Results and Agriculture Sector in Iraq progress update meetings periodically Assistance, Highlights section – BE activity (P171561) Advisory Support and Annex 3 – and Analytics Progress Overview Per Project Support for Improved Pipeline Ministry of Agriculture The team shared the support for improved farm management and Technical Refer to Annex 3 – Farm Management– RE piloting models of aggregation in Iraq - (P173503) proposal with Assistance Progress Overview activity (P173503) the Ministry of Agriculture, which endorsed the project activity and and Recipient- Per Project informed the Ministry of Planning. Discussions on implementation Executed Activity arrangements are on-going Support to Manage BE: Ministry of Environment The team has worked closely with the Ministry of Environment Technical Refer to Results and Environmental Pollution Active; through its International Environmental Relations Department and Assistance, Highlights section Hotspots in Iraq – BE/RE RE: Oil Pollution Division both during preparation of the concept note Advisory Support and Annex 3 – activity (P173049) Pipeline for this Bank Executed project and its implementation and Analytics Progress Overview Per Project Water Supply and Active Ministry of Construction, The Project is already ongoing. The Task Team is working with Technical Refer to Results and Sanitation Utility Reform Housing, Municipalities Government counterparts for project implementation Assistance, Highlights section Technical Assistance – BE and Public Works; Advisory Support and Annex 3 – activity (P175808) Mayoralty of Baghdad; and Analytics Progress Overview Baghdad Sewage Authority; Per Project Basra Sewage Department; Baghdad Water Authority 65 Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Technical & Economic Active Ministry of Electricity The Bank team has been engaging with a technical committee Technical Refer to Results and Due Diligence to Support from the Ministry of Electricity, comprising members from multiple Assistance, Highlights section Iraq Southern Region technical units from the Ministry and regional state electricity Advisory Support, and Annex 3 – Electricity Network companies, as well as the Bank’s Pan-Arab Regional Energy Trade and Analytics Progress Overview Reinforcements – BE Program team and consultants Per Project activity (P175879) Social Protection and Active Ministry of Social Affairs; Project progressing well with strong government buy-in Technical Refer to Results and Jobs for Poor and Ministry of Planning Assistance and Highlights section Vulnerable Iraqis – BE Analytics and Annex 3 – activity (P171639) Progress Overview Per Project Protecting and Promoting Pipeline Ministry of Labor and The pilot concept was first discussed with the Ministry of Labor Analytics and pilot Refer to Annex 3 – Human Capital in Iraq – Social Affairs and Social Affairs during a mission to Baghdad in March 2020 activity that can Progress Overview An Economic Inclusion following preliminary discussions in 2018. Between March and be scaled up or Per Project Pilot (EIP) – BE/RE activity July of 2020, international experiences were shared with staff inform a broader (P174422) from the Ministry, through presentations by the World Bank team, recovery program as well as presentations arranged virtually with Yemeni and Egyptian counterparts who have launched similar programs in their countries. These sessions included staff from the various sections under the Directorate of Labor and Vocational Training (DLVT) of the Ministry, ranging from the planning section, the training section, the microloans section, the incubators section and others. From July to October 2020, the World Bank worked with the DLVT to further decide some pilot parameters for location, economic activity focus, beneficiaries and implementation arrangements, including a virtual project preparation mission in October with the Ministry of Labor and Social Affairs and the Ministry of Planning. Members of the project’s management team have been tentatively identified. Moreover, the World Bank has carried out assessments of the financial management, procurement, and environmental and social safeguards capacities of the Ministry, in line with Investment Project Financing rules and regulations. The project is entering the appraisal stage and is expected to be approved by the Bank in March 2022. 66 I3RF ANNUAL REPORT 2021 Annex 2 – List of Projects with Details on Government Engagement Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Support to Education Active Ministry of Education, Close working relationships with various Ministry of Education Technical Refer to A Focus on and Skills Development Ministry of Higher departments (Financial Affairs; Curriculum Directorate; Teacher Assistance, the Education Reform in Iraq – BE activity Education and Scientific Training and Development Institute; Assessment and Examination Advisory Support Agenda: Results of (P171165) Research Directorate); Ministry of Planning and Ministry of Education, Ministry and Analytics the SESDI Project and of Higher Education Annex 3 – Progress Overview Per Project Innovations towards Pipeline Project Management The activities respond to current government priorities. The WB Investment Project Refer to Annex 3 – Learning in Lagging Team from the EODP- was asked to build on the current engagement to scale up support Financing Progress Overview Iraqi Governorates – RE Additional Financing (AF) for the education sector in Iraq both to address immediate needs Per Project activity (P175721) Education Component, in stemming from the COVID-19 crisis and pursue medium- and close coordination with long-term development objectives of the sector. In addition, the the relevant technical activities build on and complement ongoing education operations departments (curriculum, (for example, expanding and building on teacher training activities assessment, teachers, under EODP Education component) and technical assistance e-learning, planning, (SESDI ASA), and leverage capacity built under those to allow for finance) within the Ministry holistic and timely support to address the most urgent education of Education and Ministry sector needs. This RE grant will be managed by the PMT from the of Planning EODP-AF Education Component, in close coordination with the Ministry of Education and Ministry of Planning. This implementation arrangement will use and build on a well-functioning and experienced Project Management Teams Support to Tertiary BE: Ministry of Higher The project design was consulted with the Ministry of Higher Technical Refer to Annex 3 – Education in Iraq– BE/RE Active; Education and Scientific Education and Scientific Research, Ministry of Planning, Ministry of Assistance, Progress Overview activity (P175694) RE: Research Health, Ministry of Agriculture, Ministry of Electricity and others. Advisory Support, Per Project Pipeline Technical assistance has been provided to (i) MoHESR in project Analytics and preparation including in evaluation and selection of proposals Financial Support for piloting a Competitive Fund Program and in developing (seed funding) environmental and social safeguards frameworks; (ii) the selected proposal university teams in developing implementation plans including budget plans and risk mitigation measures; and (iii) MoHESR and the selected proposal university teams in project fiduciary matters. The Government request letter for this project is in process 67 Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Iraq Road Maintenance Pipeline Ministry of Construction, Government counterpart has been duly engaged in project Technical Refer to Annex 3 – Microenterprises Grant Housing, Municipalities preparation, including technical elements and safeguards Assistance, Progress Overview Project – RE activity and Public Works instruments. Grant agreement is ready for signing and awaiting Advisory Support Per Project (P171446) action by the government counterpart and Works Strengthening Active Ministry of Health and The proposal was developed jointly with the Ministry of Health. A Grant financing Refer to Annex 3 – Immunization Systems Environment technical session was held on August 23, 2021, with the Ministry of is aligned with Progress Overview for Equitable and Quality Planning and I3RF donors to discuss the proposal. The proposal was the IBRD US$98 Per Project Delivery of COVID-19 approved by the Ministry of Planning and I3RF Secretariat on August million loan to Vaccination through 29, 2021 the Government Third Party Monitoring – to support the RE activity (P177038) acquisition and deployment of COVID-19 vaccines COVID-19 Response Active Ministry of Health and The Government is fully engaged in implementing the activities Technical Refer to Results and and Health System Environment Assistance, Highlights section Strengthening – BE Advisory Support, and Annex 3 – activity (P174641) and Analytics Progress Overview Per Project Pillar 2: Economic Diversification and Private Sector-Led Growth Iraq Economic Active Ministry of Planning, The project was prepared in collaboration with the Ministries Technical Refer to A Focus on Diversification and Ministry of Finance, Reform of Planning, Finance, Trade and Reform Management. Several Assistance, the Economic Reform Growth ASAs (includes Management Cell at the meetings and written exchanges have contributed to the design Advisory Support, Agenda: Context the Reform Matrix and Prime Minister’s Office of the components. Moreover, the project benefitted from Analytics and and Advancements White Paper) – BE activity several rounds of discussion with donor partners including those other types section, the Results (P176098) contributing to the I3RF (Canada, Germany, Sweden and UK) and of support and Highlights other partners including the European Union and GIZ (embedded section and Annex 3 experts and – Progress Overview purchase of Per Project software) 68 I3RF ANNUAL REPORT 2021 Annex 2 – List of Projects with Details on Government Engagement Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Iraq Financial Sector – Active Central Bank of Iraq, The work plan was developed in close collaboration with the Technical Refer to A Focus on BE activity (P171615) Economic Reform Unit at Central Bank of Iraq with inputs from the Ministry of Finance and Assistance, the Economic Reform the Prime Minister’s Office, the entities listed previously. The team is working with a dedicated Advisory Support Agenda: Context Reforms Management team at the Central Bank of Iraq comprising the General Managers and Analytics and Advancements Cell, Financial Intelligence of Banking Supervision, Payment, Infrastructure and the Advisor section, the Results Unit, Ministry of Planning, Governor Office. Government of Iraq counterparts were updated and Highlights Ministry of Labor and through regular briefings and presentations. Presentations were section and Annex 3 Social Affairs and Ministry made to the Minister of Finance, Central Bank Governor, Minister of – Progress Overview of Construction, Housing, Planning, Head of Reform Management Cell and to other financial Per Project Municipalities and Public sector stakeholders including the Iraqi League of Private Banks, Works, in coordination Payment System Providers and the Iraqi British Business Association with Ministry of Finance. among others. The team has also kept I3RF donors updated through The task team is expecting the Iraq Economic Contact Group and bilaterally (EU/KfW/GIZ/IOM) to liaise further with the to align work plans National Housing Fund on potential products and pilot activities Analytics and Advisory Active Ministry of Finance The team is engaging actively with the Reform Management Cell Technical Refer to A Focus on for Management of Public in the Prime Minister’s office, the Debt Management Department Assistance, the Economic Reform Resources and Fiscal in the Ministry of Finance and the private office of the Minister Advisory Support, Agenda: Context Federalism – BE activity of Finance to initiate and provide Technical Assistance. It is also Analytics and and Advancements (P166640) actively engaging with the newly established Federal Civil Service Learning Event on section, the Results Commission Political Economy and Highlights Analysis section and Annex 3 – Progress Overview Per Project 69 Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF COVID-19 Adaptation Active Ministry of Finance, Central The project has been endorsed by the I3RF Steering Committee and Technical Refer to A Focus on and Recovery Pilot for Bank of Iraq approved by the WBG Regional Vice President on June 25th, 2021. Assistance, the Economic Reform MSMEs in Iraq (CARP) – The project Grant Agreement was signed by the Ministry of Finance Advisory Support, Agenda: Context RE activity (P174273) on October 1, 2021. The project team is expeditiously finalizing Analytics and Advancements preparations with the project implementation agency (PIA) and GIZ. section, the Results Preparatory activities include diagnostics activities, conducting a and Highlights global review of MFI policies and regulations, finalizing program section and Annex 3 design for both project components, drafting the project operations – Progress Overview manual, and ongoing engagement with public and private sector Per Project stakeholders. The WBG has been working closely with the Central Bank of Iraq to prepare Component 1 activities, described in more detail below. Component 2 activities largely target and benefit private sector actors but are closely linked to Iraq’s business environment reforms agenda surfaced under a sister project, the Enabling Environment for the Creation and Growth of Innovative Small and Medium Enterprises (P171175) Enabling Environment Active The Economic Reform Unit A new Higher Committee to lead implementation of the National Technical Refer to A Focus on for Small and Growing at the Prime Minister’s Agenda for Improving the Business Environment in Iraq (former Assistance, the Economic Reform Businesses – BE activity Office; Higher Steering committee was dissolved last year) was established on June Advisory Support, Agenda: Context (P171175) Committee for Improving 1st, 2021 by the Secretary General of the Council of Ministers. Analytics, and Advancements the Business Environment This inter-ministerial body reports directly to his Excellency the Investors’ section, the Results in Iraq at the Council of Prime Minister and is composed of officials from government Grievances and and Highlights Ministers; Central Bank of entities with roles in the business environment. The Committee’s Investors’ Dispute section and Annex 3 Iraq mandate is to work on proposals for legislative instruments, new Settlement – Progress Overview policies, and development of new systems to improve the business Per Project environment. The main beneficiaries are agencies involved in the business environment reform agenda such as the Ministry of Planning, Ministry of Trade, Ministry of Justice, Central Bank of Iraq, Amanat Baghdad, the private sector and indirect beneficiaries such as innovative SMEs, ecosystem builders and SME-focused funds. The MOF and CBI are also project counterparts for a sister project, COVID-19 Adaptation and Recovery Pilot: Supporting Firms’ Resilience, Access to Finance and Growth in Iraq (174273). 70 I3RF ANNUAL REPORT 2021 Annex 2 – List of Projects with Details on Government Engagement Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Pillar 3: Coordination and Program Support Building Evidence for Active Ministry of Planning, Central The team is working closely with the Central Statistical Organization Technical Refer to the Results Policy Making – BE Statistical Organization, and Kurdistan Region Statistics Office to prepare the IHSES-III Assistance and and Highlights activity (P170264) Kurdistan Region Statistics survey and has collaborated with the Ministry of Planning to update Analytics section and Annex 3 Office poverty projections. The phone survey reports, and other analytical – Progress Overview works are shared with the Central Statistical Organization and Per Project Kurdistan Region Statistics Office Iraq Household and Pipeline Ministry of Planning, Central The project was prepared in close collaboration with the Central Technical Refer to Annex 3 – Socioeconomic Survey Statistical Organization, Statistical Organization and Kurdistan Region Statistics Office which Assistance Progress Overview (IHSES) III – BE/RE activity Kurdistan Region Statistics helped develop the Project Procurement Strategy for Development, and Analytics, Per Project (P176590) Office social safeguards and other related documents. The activities and and Recipient- project planning to draft the Poverty Reduction Strategy III was Executed Activity done in collaboration with the PRS secretariat at the Ministry of Planning Fiduciary Oversight and Active Task 1 (Third Party Task 1. The WB team contracted the TPMA and is responsible for Technical Refer to the Results Capacity Strengthening Monitoring): Ministry of contract implementation, monitoring, and annual evaluation. The Assistance and Highlights (includes Strengthening Planning, Public Contracting TPMA has fully mobilized a team of experts as required in the Terms section (TPMA Financial Management Directorate (PCD), Ministry of Reference since June 2020, and is coordinating with government Box) and Annex 3 – and Procurement of Construction, Housing, counterparts to perform its task on the ground. Task 2. The capacity Progress Overview Capacities; and Third Municipalities and Public building program will be implemented directly by a WB team Per Project Party Monitoring Agent) – Works, Roads and Bridges of financial management and procurement specialists in close BE activities (P174339) Directorate, Ministry of collaboration with government stakeholders. The Concept Note Education, Ministry of Water has been prepared, and project objectives and scope have been Resources, Ministry of presented to the Government of Iraq. Health, Ministry of Transport, Nineveh Governorate, Salah El Dine Governorate, Anbar Governorate, Diyala Governorate. Task 2 (Fiduciary Capacity Building Program): Ministry of Planning, Public Contracting Directorate, Ministry of Finance, Public debt directorate, and Iraqi Union of Accounting and Auditing (IUAA). 71 Project Name Status Government Counterpart Details on the Engagement with Government Counterparts Type of Support For Further Details Provided by the on this project I3RF Strengthening Active REFAATO through the The team responsible for component 3 of the ASA, which focuses on Technical Refer to the Results Peacebuilding, EODP and the Roads citizen engagement, has developed a theory of change and action Assistance, and Highlights Governance and & Bridges Directorate/ plan that will see them engage more intensively with government Advisory Support section and Annex 3 Citizen Engagement in Ministry of Construction, and civil society representatives in FY22. The team plans to engage and Analytics – Progress Overview Reform, Recovery and Housing and Public with the Ministry of Planning, the NGO Directorate, the Ministry of Per Project Reconstruction – BE Municipalities through the Construction, Housing, Municipalities and Public Works, and select activity (P173326) Iraq Transport Corridor government entities that are already considered clients of ongoing Project I3RF operations and activities. Additionally, the team is providing support to the Iraq Country Climate and Development Report (CCDR) and may engage with the Ministry of Environment 72 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project ANNEX 3 – PROGRESS OVERVIEW PER PROJECT 73 PILLAR 1: SOCIO-ECONOMIC RECOVERY AND RECONSTRUCTION 1.1 AREA-BASED RECONSTRUCTION IN MOSUL AND OTHER URBAN CENTERS Area-Based Reconstruction in Mosul and Other Urban Centers in Iraq – BE activity P CODE P162875 GOVERNMENT Reconstruction Fund for Areas Affected by Terrorist Operations (ReFAATO), Governorates Project Management Teams, MoP, MoF COUNTERPART READINESS & Ministries have been briefed and training has been conducted in coordination with ReFAATO and Project Management Teams GOVERNMENT ENGAGEMENT STATUS  Active PROJECT To support planning for and facilitate an area-based approach (ABA) using integrated multi-sector and participatory approaches for the recovery and DEVELOPMENT reconstruction of Iraq’s urban centers, starting with Mosul as a pilot. This will inform recovery and reconstruction investment decisions to promote social OBJECTIVE reconciliation, incentivize economic development and job creation, and restore services, along with a focus on institution building and restoring cultural   heritage assets. BRIEF PROJECT This activity aims to develop an integrated, multi-sector, participatory approach for resilient, inclusive, sustainable recovery of urban centers in Iraq, based on DESCRIPTION good practices and lessons from other post-crisis reconstruction efforts and Iraqi initiatives. This will entail an ABA program initially being piloted in Mosul, to be scaled up to other urban areas. This will be a first step starting with Mosul, and 2–3 other cities could be supported to prepare city-wide plans based on the learning from Mosul. Going beyond conventional approaches to reconstruction, short- and medium-term plans would integrate issues related to institution building, social capital development, inclusion, and cultural heritage to support the sustainability of peace over the medium-term. TIMEFRAME  2020–2022 SECTOR CONTEXT  The Nineveh province, of which the historic city of Mosul is the capital, was one of the most affected by the conflict, and the city itself was the most severely   damaged. For instance, Mosul has the largest share of housing damage in the seven directly affected governorates with an estimated damage cost that ranges between IQD 6–8 trillion alone (US$5.1–6.9 billion), according to the 2018 Iraq Damage and Needs Assessment. In line with the Recovery, Reconstruction and Development Plan (RRDP), the GoI has been leading the recovery and reconstruction effort with support from the international community. Over the last two years, early recovery activities such as restoring service delivery, reviving markets and reconstructing key facilities have taken place. However, more progress is needed to integrate these activities into a more comprehensive, city-wide reconstruction plan, and to introduce new thinking in city planning, governance and growth. This will support the government’s intention to facilitate better living conditions for the affected population of Mosul, and in other urban centers for those who remained in place during the conflict, and to facilitate the return of displaced populations in other parts of Iraq or neighboring countries. Supporting the needs of both internally displaced persons and returnees in urban centers is increasingly important to maintain social cohesion and sustainable recovery, and will be a key consideration in the selection of pilot project cities. 74 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project COMPONENTS  1. Area Based Approach for Urban Reconstruction: Create a plan/strategy for inclusive and resilient recovery of Iraqi urban centers which fosters local economic   development and supports the forcibly displaced and their hosts. The plan will follow a geographically targeted, participatory, and multi-sectoral area-based approach, and will address the climate – conflict nexus and create a resilient, low carbon model for inclusive urban reconstruction. The activity seeks to draft the plan starting with Mosul and 1–2 other cities as pilots (see component 3). Cities in which pilot projects will be conducted will be selected through a city diagnostic, which includes a rapid climate risk assessment undertaken nationally and targeting 10–12 cities. 2. Subnational PMT’s Capacity Building: This activity will build capacity at the governorate level to adopt an area-based approach to identify, design and coordinate investments for reconstruction projects in line with city-level reconstruction needs and priorities. 3. Pilot projects and Harnessing Cultural Heritage for Reconstruction and Recovery : This component will prepare three pilot projects in three cities selected under component 1. Specific stakeholder engagement will be run in each selected city with key counterparts and with main counterparts and stakeholders at National level, as appropriate. The activity in Mosul will focus on harnessing cultural heritage for reconstruction and recovery, while other pilots will target economic and social recovery and climate risk reduction. Based on the pilot projects, stakeholder engagements, and the strategy for inclusive and resilient recovery recommendations for priority engagements in the cities and in the country will be provided. FINANCING   I3RF: US$2 million; Quality Infrastructure Investment Partnership Grant: US$500,000 LINKAGES TO The programmatic approach will promote complementarity of the peacebuilding and citizen engagement activities funded under the I3RF. The Subnational OTHER PROJECTS/ PMT’s Capacity Building pillar is part of the broader EODP, especially Component 10, the objective of which is to restore basic municipal infrastructure and INITIATIVES   services and support socio-economic development in selected urban areas in Iraq by strengthening the institutional capacity of the GoI at local and national   levels. It also supports preservation of cultural heritage assets. The activity also aligns with the GoI‘s priorities as outlined in the RRDP, namely pillars 1, 2, and 4 (Governance; Reconciliation and Peacebuilding; Infrastructure) and with the GoI’s National Development Plan, namely pillars 1 and 2 (Forging Stability and Peace and Delivering Good Leadership; Reconstruction and Recovery for Liberated Governorates). Finally, the ABA will support the potential Iraq Resilient and Inclusive Territorial Development Program (P178152). LINK TO GOI Pillar 3 to improve basic infrastructure through recovery and rehabilitation of multiple sectors and pillar 4 to increase access to basic services (including REFORM AGENDA drinking water and sanitation) and protect the most vulnerable people. The ABA will also identify opportunities to create jobs and increase SMEs engagement in recovery, rehabilitation, and reconstruction. TYPE OF SUPPORT Technical Assistance, Advisory Support, and Analytics GENDER EQUALITY The project contributes to economic empowerment of women and girls, and to improving data on gender (by measuring beneficiary satisfaction). Iraqi women & WOMEN have limited opportunities to express themselves, and limited agency and work choices. According to the World Bank, less than 15 percent of women work in EMPOWERMENT Iraq and the gender wage gap is 22 percent. Further, one in five Iraqi women has been harassed in a public space, and concerns for personal security discourage women from seeking employment. The proposed strategy will adopt a gender sensitive approach to the area-based approach pilots to increase women‘s involvement in planning their cities, and help to make public spaces more secure and comfortable so that women can engage in public life and the workplace. The pilot projects will actively engage women in the cities, and seek their inputs and ideas on employment preferences and economic opportunities that could be harnessed through the pilot projects. Currently, the majority of PMT members are men, and there is a need to extend the target audience for trainings to women in academia, the private sector and local communities, which will include women representation. 75 CLIMATE CHANGE & The new strategy has been designed to address climate adaptation and mitigation, resilience and inclusiveness for recovery and reconstruction in Iraqi cities. THE ENVIRONMENT A climate risk diagnostic will be finalized to assess climate risks in the country and in 10–12 targeted cities. The outcomes of the diagnostic will guide city selection for the pilot projects. Training will address climate mitigation and adaptation and build awareness and specific capacities among PMTs and other stakeholders. The Iraq NDCs includes target emission reductions of 1–2 percent in Greenhouse Gas emissions by 2030, and this strategy will create a platform for further Greenhouse Gas reduction in urban centers. COVID RESPONSE & N/A IMPACT IMPLEMENTATION The activity is managed by URL on the WBG side, in coordination with relevant sector Global Practices (GPs), including the Governance GP, Social GP, and the ARRANGEMENTS  Fragility, Conflict and Violence (FCV) Group. From the GoI side, ReFAATO and the PMTs are managing the activity, other counterparts will be identified when   the cities are selected. Externally, partnerships for implementation have been established, and others will be sought with local and international organizations, in particular ReFAATO, UN-Habitat, relevant UN agencies, various bilaterally funded initiatives, and those with ongoing cultural heritage projects in Mosul, including the International Centre for the Study of the Preservation and Restoration of Cultural Property (ICCROM), Smithsonian, and UNESCO. KEY DELIVERABLES In terms of analytical work, a stakeholder and engagement plan has been completed in Mosul and nationally. Additional, ongoing analytical activities include & RESULTS the city selection diagnostic and rapid climate risk assessment of cities under component 1. The city selection diagnostic, which includes the rapid climate FROM JANUARY TO risk assessment will help identify the two other pilot cities in addition to Mosul. The diagnostic and risk assessment will also feed into the development of DECEMBER 2021 the strategy. As of June 2021, trainings have been conducted for PMTs, with a total of 65 beneficiaries so far. The I3RF will support PMTs to design area-based approach plans using city-wide integrated planning methods and a multi-sectoral approach to respond to the immediate needs of the population recovering their lives in various neighborhoods/localities of the city. Implementation will be financed from the EODP Component 10, QIIP Trust Fund and other sources. IMPLEMENTATION Because of the ongoing COVID-19 restrictions, training for PMTs had to be organized and conducted virtually, which was not as conducive and effective as in- CHALLENGES person training. Since PMTs prefer in-person communication, and because of internet connectivity issues, future training will be conducted in person providing this can be done safely. BENEFICIARIES People residing in and returning to Mosul and other urban centers of the other two pilot cities, with a focus on youth, women, IDPs, refugees, and host communities, as well as PMTs at the governorate level. GEOGRAPHIC Sub-national scope with a focus on Mosul and two other pilot cities; then scale-up of the area-based approach to other urban centers. Training will also include COVERAGE  PMTs in three other governorates where the investment project is operating, namely Anbar, Diyala and Salah El Din. 76 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project 1.2 AGRICULTURE, NATURAL RESOURCES AND WATER Revitalizing the Agriculture Sector in Iraq – BE activity P CODE P171561 GOVERNMENT MoA COUNTERPART READINESS & The team is organizing joint EODP and I3RF supervision and progress update meetings periodically. GOVERNMENT ENGAGEMENT STATUS Active PROJECT To deliver policy recommendations and innovative solutions to encourage the agri-food system digital transformation and climate-change adaptation, and to DEVELOPMENT promote labor participation of women in the sector.  OBJECTIVE BRIEF PROJECT The proposed activity is an initial step towards longer-term engagement in modernizing Iraq’s agri-food sector and maximizing its contribution to employment, DESCRIPTION economic recovery, diversification, and resilience. It aims at setting in motion an in-depth transformation process through a 3-track approach: Policy Formulation and Capacity Building (track 1), Social Inclusion (track 2), and Technological Innovation (track 3). TIMEFRAME  May 2020–April2022 SECTOR CONTEXT  The prolonged conflict in Iraq has had a major impact on the development of Iraq’s agri-food sector. Both private and public infrastructure has been significantly   damaged and needs to be rehabilitated. For example, lack of seed and fertilizer are rampant, irrigation canals and pumps have been damaged, post-harvest storage facilities no longer exist, agricultural machinery and storage facilities have been damaged, veterinary services, research facilities and extension centres have been destroyed or need comprehensive rehabilitation. Further, water and electricity services have deteriorated, and the ability to access markets, provide services, and access new technologies and knowledge have been severely disrupted. Currently, the World Bank is working with the GoI to restore basic infrastructure (irrigation, storage, seed facilities) through the EODP. However, the rehabilitated infrastructure is not sufficient for the development of a competitive and resilient to the economic shocks agri-food sector, and there is a need for evidence-based policymaking, capacity building and knowledge transfer. The agri-food sector offers opportunities for economic diversification and growth and can contribute to peace and reduce fragility. Primary agriculture is one of the largest non-oil sectors of Iraq’s economy (5 percent of total GDP), and the sector as a whole contributes well over this figure. The agricultural sector is also a significant source of employment (approximately 19 percent) and is probably the main source of private sector employment. Currently, Iraq has limited options for export diversification, as dates, its second largest export commodity, are a minor export compared to oil. Once the agri-food sector is rehabilitated, it will have high potential to increase and stabilize crop yields. The projections of the Iraq Economic Monitor 2019 indicate that achieving Iraq’s Net Domestic Product (NDP) yield targets for fruits and vegetables, livestock and cereals would lead to a 27 percent increase in agriculture GDP in the short- to medium-term (an average annual increase in agriculture GDP of 4.9 percentage points); this would increase both rural and urban household incomes, especially for female- headed households. High-value horticulture also has great potential as it is less affected by government policies than cereals. Agriculture is practiced by small- to medium-size farmers; and policy reforms, collective action by these farmers (in cooperatives, associations, or other systems of aggregation) and ensuring equitable access to natural resources could help rebuild local institutions and reduce the risk of fragility and economic shocks in the future . 77 COMPONENTS  Track 1 – Policy Advice and Capacity Building: This track will strengthen the Ministry of Agriculture’s (MoA’s) Policy Unit by (1) providing policy advice related   to COVID-19’s impacts on food security; (2) producing a capacity development plan for a strategic and coherent agenda between development partners and the Ministry; (3) developing e-learning modules on digital innovation, women’s empowerment, and climate-smart practices. Track 2 – Social Inclusion: Women’s Empowerment: This activity will assess the gender-differentiated impact of COVID-19 and progress towards gender parity in the agricultural sector. The activity will be piloted with EODP beneficiaries and the resulting data will be integrated into a digital platform (Track 3) and used for the policy advice and e-learning module (Track 1) to promote gender parity and design gender-sensitive projects/interventions. Track 3 – Technological Innovation: Digital Platform: This activity will design a digital registry to monitor agri-food data related to food availability, food prices, supply chains, rural employment, detecting the impacts of economic shocks (e.g., due to COVID-19) and conflicts, and informing evidence-based decision making. FINANCING   I3RF: US$1.5 million LINKAGES TO EODP, Support for improved farm management and piloting models of aggregation in Iraq - (P173503), and Agri-food sector transformation in Mashreq - OTHER PROJECTS/ (P175510) INITIATIVES   LINK TO GOI The project directly contributes to the White Paper which prioritizes interventions in the agri-food sector. Specifically, it will contribute to the following priority REFORM AGENDA – “Improve the entire value chain from the start (land and inputs) to the end (agricultural outputs and agriculture-dependent sector inputs) and target key opportunities to increase the agricultural sector‘s contribution to GDP”. TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics GENDER EQUALITY The project contributes to economic empowerment of women and girls and improving data on gender. Women in Iraq suffer from insufficient educational & WOMEN opportunities and healthcare, limited access to the labor market, and high levels of violence and inequality. The slow progress in raising Iraq’s human EMPOWERMENT development indicator (HDI) is explained by gender inequalities in health, education and Gross National Income (GNI) per capita. The cost of gender inequality is significant for human development in the country. In 2018 gender inequality resulted in a 19.8 percent reduction in human development in Iraq. The gender inequality index value is 0.540, ranking Iraq 131 out of 162 countries in the 2018 index. Gender inequality in rural areas is even more evident, and aggravated by limited access to finance, natural resources, agricultural inputs, education, health services, and substantial social inequalities. This is in contrast with the significant role that women play in agriculture and the food-system. The activity would develop a manual women’s empowerment in agriculture index (WEAI) adjusted to the Iraqi context, and assess a gender-differentiated impact of COVID-19 and progress towards gender parity in the agricultural sector by piloting WEAI. WEAI can measure women’s empowerment and inclusion in the agricultural sector and inform policy making process. WEAI was launched by IFPRI, the Oxford Poverty and Human Development Initiative (OPHI), and USAID‘s Feed the Future in February 2012, the first comprehensive, standardized measure of women’s empowerment and inclusion in the agricultural sector. The WEAI comprises two sub-indices. The first assesses the degree to which respondents are empowered in five domains of empowerment (5DE) in agriculture. It shows the percentage of women and men who are empowered and, among those who are not, the percentage of domains in which they enjoy adequate achievements. In order to efficiently use the index it should be customized to Iraq’s context. The second sub-index, the Gender Parity Index (GPI), measures gender parity. The GPI reflects the percentage of women who are empowered or whose achievements are at least as high as the men in their households. For those households that have not achieved gender parity, the GPI shows the empowerment gap that needs to be closed for women to reach the same level of empowerment as men in their households . 78 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project CLIMATE CHANGE & The project contributes to climate adaptation and mitigation through capacity building activities on Climate Smart Agriculture (CSA) interventions in Iraq. THE ENVIRONMENT Specifically, it will (i) articulate benefits from pursuing these options (economic, social, and environmental), including economic and financial feasibility studies results; (iii) make recommendations for public support and policy realignment, budgeting, planning, and institutional/legal frameworks to maximize public investment and leverage private investment for CSA implementation. The activity will also directly contribute to Iraq’s NDC as it underlines the importance of adaptation of the agricultural sector for increased resilience and sustainable development. COVID RESPONSE & The activity contributes to the COVID-19 response by (1) assessing COVID-19 impacts on food security and identifying policy options and emergency interventions; IMPACT (2) providing capacity building through e-learning modules; (3) increase clients knowledge about remote sensing technologies for remote supervision; (4) assessing the gender-differentiated impacts of COVID-19. IMPLEMENTATION The activity is implemented by the Agriculture and Food Global practice. The team collaborates with the Social Protection and Jobs, Macroeconomics, Trade ARRANGEMENTS  and Investment (MTI) and Water Practices. KEY DELIVERABLES COVID-19 monitoring: The World Bank continued the joint collaboration with the United Nations entities (WFP, IFAD, FAO) to assess COVID-19 impacts on food & RESULTS security and identify policy options and emergency interventions. The objectives for this partnership are to a) provide a coordinated assessment of the impact of FROM JANUARY TO COVID-19 on the Food Supply System and b) build support for policies and investment responses to the challenges of COVID-19. This also allowed to capitalize DECEMBER 2021 on international agencies’ comparative advantages and avoid duplications. Since January 2021, four biweekly reports and one quarterly Food security monitors have been produced. Policy dialogues: On April 21, 2021, the “Enabling Iraq’s Food system contributions to employment, growth, and resilience to shocks” seminar was organized to explore how the strategic reforms and actions outlined in the Government’s White Paper and its action plan can be sequenced in order to address these challenges. The keynote was delivered by the Deputy Agriculture Minister with introductory remarks about Iraq’s Vision for Agriculture from the National Food Security Committee. The FAO Representative moderated the panel, which included public and private sector representatives. Iraq High Frequency Phone Survey (IHFPS): The agriculture and poverty teams co-financed three rounds of the Iraq High Frequency Phone Survey (IHFPS) with the WFP Iraq. The data has been instrumental in monitoring food security, employment, child learning, access to market, healthcare, and other services during the COVID-19 pandemic. This activity will (i) inform the planning of World Bank operations and emergency responses to the pandemic in Iraq and (ii) support as an input to a sustainable data system that helps inform the World Bank and the GoI about socio-economic changes, food security, market functionality and the level of economic activities in the country.  Policy analysis: A policy paper was delivered on the policy process, stakeholders, and policy arenas in the agri-food sector to contribute to Iraq‘s agri-food policy process and identify current bottlenecks and areas of reform. IMPLEMENTATION The field data collection for the digital registry and gender index was delayed. CHALLENGES BENEFICIARIES Ministry of Agriculture, and rural population, food insecure population, women. GEOGRAPHIC National level. COVERAGE  79 Support for Improved Farm Management– RE activity P CODE P173503 GOVERNMENT Ministry of Agriculture COUNTERPART READINESS & The team shared the support for improved farm management and piloting models of aggregation in Iraq - (P173503) proposal with the MoA, which endorsed GOVERNMENT the project activity and informed the MoP. Discussions are on-going regarding the implementation arrangements of the project. ENGAGEMENT STATUS  Pipeline PROJECT To test a model of aggregation to improve competitiveness, accessibility to markets, and climate-resilience for small-scale rural producers in selected pilot DEVELOPMENT areas for selected value chains (vegetables, fruits and livestock) by: (i) promoting strategic productive alliances between smallholders and the private sector, OBJECTIVE (ii) empowering rural producers through the development of self-managed organizations, (iii) increasing access to productive assets and technology, and (iv)   promoting more effective and climate smart practices in ThiQar, Babylon, and Erbil Governorates. BRIEF PROJECT With the support of this project, individual smallholders will be encouraged to engage in collective action to generate economies of scale, enhance the DESCRIPTION collective bargaining power, and invest in and share common goods (e.g., warehouses or processing equipment). Hence, their relationship is of a socio-economic nature, focused on identifying market opportunities within a concrete business plan while strengthening social cohesion, both of which are further reinforced through an improved model of aggregation. TIMEFRAME  TBC SECTOR CONTEXT  Due to conflict, aggregation has become more challenging and underdeveloped in Iraq. This has eroded social capital and the institutions that enable collective   action. Furthermore, the infrastructure which is essential to aggregation, farm productivity and value chain competitiveness have been destroyed or need major rehabilitation. The lack of infrastructure also means that access to innovation, knowledge and technology has been restricted, and farming practices and technologies in value chains became outdated, with negative consequences for the environment. In rebuilding this infrastructure, there are opportunities to identify and build strong points of aggregation, a form of collective action leading to attendant productive and commercial partnerships. Global lessons indicate that aggregation of small and medium scale farmers helps achieve economies of scale along value chains. Aggregation points bring together small farmers, off-takers, processors, transporters and traders, and facilitate access to other services, including finance, market information, etc., as part of productive partnerships at given stages of the value chain. The integration of digital technologies can improve points of aggregations and make the agri-food sector more efficient, inclusive, and environmentally sustainable, thereby increasing benefits for farmers, consumers, and society at large. In post-conflict environments, aggregation is recognized as an important first step towards reestablishing trust and improving overall governance. COMPONENTS  Component 1: Identifying demand and opportunities for aggregation   Component 2: Investing in supply chains Component 3: Governance and project management FINANCING   I3RF: US$5 million 80 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project LINKAGES TO EODP and revitalizing the agriculture sector in Iraq (P171561) OTHER PROJECTS/ INITIATIVES   LINK TO GOI The project directly contributes to the White Paper, which prioritizes interventions in the agri-food sector and more specifically “Improving the entire value- REFORM AGENDA added chain from the start to the end”. TYPE OF SUPPORT Technical Assistance GENDER EQUALITY Contributes to economic empowerment of women and girls and improving data on gender. In 2018, gender inequality in Iraq resulted in a 19.8 percent & WOMEN reduction in human development. These inequalities are more evident in rural areas, where they are aggravated by limited access to finance, natural resources, EMPOWERMENT agricultural inputs, education health services, and substantial social inequalities. This is in contrast with the significant role that women play in agriculture and the food-system. The project seeks to close gender gaps in access to productive resources that contribute to economic opportunities. More specifically, it will address gaps in the project areas and sector that limit access to knowledge and improved technologies by targeting women in the diffusion of technologies, best practices, and knowledge through the appropriate access channels. This will help women-owned, small agricultural enterprises, and benefit women in their roles as producers, processors, marketers, and service providers. CLIMATE CHANGE & Food availability is compromised by projected yield declines driven by changing temperature and precipitation patterns. As water shortages are projected to THE ENVIRONMENT worsen with climate change, salinization problems will worsen even more without deliberate strategies to adapt. Increasing water scarcity driven by climate change is a significant challenge for the agriculture sector, the largest water user in Iraq. At the same time, according to FAOSTAT, agriculture also contributes a substantial share of Iraq’s GHG emissions. It is estimated that agriculture contributes 2.7 percent of emissions, making it the largest greenhouse gas emitting sector after the energy and waste sectors in Iraq. Additionally, unaccounted GHG emissions are caused by food waste and loss in the agri-food supply chain due to poor harvesting techniques. Therefore, the activity will contribute to climate change adaptation by promoting climate-smart agriculture practices (e.g., improved varieties breeding and water management practices), and contribute to climate change mitigation through improved carbon sequestration in soils and biomass, and reduced GHG emissions from livestock through improved feeding and grazing practices. The activity will directly contribute to Iraq’s NDC as it underlines the importance of adaptation of the agricultural sector for increased resilience and sustainable development. COVID RESPONSE & This operation will support Iraq to buffer the impact of the COVID-19 crisis, help build the resilience of households and businesses, and inform government IMPACT efforts to implement a new program for agriculture and rural areas that would lead to a stronger and more inclusive recovery. IMPLEMENTATION The Agriculture and Food Practice is managing this activity. The implementation entity will be the FAO of the UN. The contributing practices include Digital ARRANGEMENTS  Development, Gender, Macroeconomics, Trade and Investment, Social Protection & Jobs and Water. KEY DELIVERABLES The project would (i) increase knowledge related to the required standards for improved competitiveness and market access of targeted value chains; (ii) & RESULTS strengthen points of aggregations productive market links through productive investments, technical assistance and business development, (iii) increase FROM JANUARY TO adoption of improved climate-smart agriculture technologies by beneficiaries; (iv) facilitate trust between producers and buyers/sellers through good financial DECEMBER 2021 and governance mechanisms. IMPLEMENTATION The agreement on implementation arrangements related to the project and the restrictions imposed by the COVID-19 pandemic resulted in some delays. CHALLENGES 81 BENEFICIARIES The direct beneficiaries of the project are 1,600 smallholder farmers, of which at least 30 percent will be women, and 30 percent will be youth. Indirect beneficiaries include marketing businesses (wholesalers and retailers), public and private service providers, and other non-state institutions involved in the selected agricultural value chains. GEOGRAPHIC The pilot will take place in the ThiQar, Babylon, and Erbil Governorates. COVERAGE  Support to Manage Environmental Pollution Hotspots in Iraq – BE/RE activity P CODE P173049 GOVERNMENT Ministry of Health and Environment COUNTERPART READINESS & The team has worked closely with the Ministry of Environment through its International Environmental Relations Department and Oil Pollution Division both GOVERNMENT during preparation of the concept for this BE project and its implementation. ENGAGEMENT STATUS  BE: Active; RE: pipeline PROJECT To support GoI in analyzing environmental hotspots and prioritize rehabilitation and clean up actions. DEVELOPMENT OBJECTIVE BRIEF PROJECT The BE activity is primarily informed by the Damage Need Assessment (DNA) carried out by The World bank in 2018, which estimated chemical and hydrocarbon DESCRIPTION contamination of over 10,569 hectares and unusable nature of over 2.3 million hectares of land due to a series of conflicts in Iraq. Building on ongoing efforts of the Chemical Management and Contaminated Sites Assessment Department of MoHE and other development partners such as UNEP’s Crisis Management Unit, the activity is carrying out the following tasks: (i) Prepare a detailed inventory of critical pollution hotspots in Iraq; (ii) Identify priority sites for remediation with emphasis on community health and safety and local economic development; (iii) Support preparation of technical studies (including engineering, costing, etc.) for remediation of priority hotspots; (iv) Support preparation of a national register of contaminated hotspots, and (v) Develop a road map/action plan for the program on remediation of hotspot sites in Iraq. These activities will contribute to the establishment of a framework for sound management of environmental and conflict pollution hotspots in Iraq with twin objectives of mitigating health and safety risks and contributing to local economic development through remediation. Based on the progress of these activities, an RE activity will also be designed that can implement remediation of priority hotspots, augment the laboratory and detailed assessment infrastructure of MoE, and design a national program for the remediation of polluted sites in Iraq. The current BE activity will also complement this long-term program development objective of the GoI. TIMEFRAME  August 2020–December 2022 82 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project SECTOR CONTEXT  The DNA 2018 by the WB estimates damages to the environment resources at IQD85 billion (US$73 million) and sectoral losses as a result of conflict at IQD3.5   trillion (US$3 billion). This assessment estimates that up to 47 percent of natural forests in the country may have been destroyed and more than 2 million ha of land contaminated by land mines and hazardous chemicals. Additionally, attacks on oil and sulphur refineries have created major environmental hazards in Salah El Din and Nineveh. A disproportionately high impact is felt by the most vulnerable members of society who are more reliant on natural resources to sustain their livelihoods. These groups include the estimated three million IDPs, women, female-headed households, and youth. Restoration of the damaged Environmental and Natural Resource (ENR) assets will require funding of IQD6.5 trillion (US$5.5 billion). In the short term (first year), the needs are estimated at IQD19 billion (US$16 million) and at IQD6.48 trillion (US$5.48 billion) over a 2–5 year period. This amount includes infrastructure reconstruction, capacity restoration, and environmental rehabilitation (ecosystem rehabilitation, clean up, and remediation, etc.). There are significant capacity and environmental infrastructure gaps in MoE, and the GoI that need to be addressed. Environmental management capacity at the national and governorate level was also damaged as a result of damage to several facilities used by the MoE including administration buildings, laboratories, research centers and environmental monitoring stations. Disruption of these services is expected to be greatest in areas of most intense conflict. As a response to this context, the GoI, through MoHE and the Ministry of Oil (MoO), have put in place a number of institutional measures to monitor, manage and remediate polluted sites. The GoI, in partnership with UNEP, has also conducted a rapid scoping in four of the seven affected governorates that revealed extensive environmental damage caused by the conflict, and the need for detailed contaminated site assessments. In this context, the current engagement on environmental hotspots agenda provides a unique opportunity to develop a long-term program to institutionalize the management of contaminated sites within a program anchored in the MoHE and MoO and demonstrate its implementation with support for I3RF. The GoI has identified a set of key priority actions for which technical assistance of the WB/ I3RF is required: (i) support to adopt institutional measures, and (ii) develop technical capacity for remediation and rehabilitation, including: technical support to the government to map and create a National Inventory of Contaminated Sites (NICS); provision of best practice methodologies to conduct detailed site assessments and prioritize sites for remediation/rehabilitation (including environmental and social standards); technical assistance to develop a road map and national program for the remediation of contaminated sites; and support to identify policy/institutional measures for the long-term sustainability of the remediation program. In parallel, GoI intends to take up remediation activities at priority sites so that the staff of MoHE and MoO can develop long term capacity for sites assessment and remediation. COMPONENTS  Component 1: Develop a detailed inventory of pollution hot spots/contaminated sites   Component 2: Identification of priority remediation sites Component 3: Detailed assessment of priority contaminated sites Component 4: Develop a road map/action plan for remediation of contaminated sites in Iraq FINANCING   I3RF: US$6 million (US$1 million BE and US$5 million RE) LINKAGES TO No direct links with projects outside I3RF. However, based on the results of the ongoing BE and proposed RE activities, development of an IBRD can be OTHER PROJECTS/ considered. INITIATIVES   LINK TO GOI The activity is linked to Recovery Pillar 3 (Social Human Development) of GoI’s Reconstruction and Development Framework (RDF) that identifies the REFORM AGENDA rehabilitation of environmental hotspots as a priority outcome. The activity also addresses critical structural challenges identified in the RDF, such as security issues due to the significant presence of explosive hazards and contamination, private sector constraints associated with insecurity, and exclusion of vulnerable groups . TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics GENDER EQUALITY The project contributes to improving data on gender and improving laws and policies affecting women. While no specific gender analysis has been carried out, & WOMEN the key gender challenges related to the sector include (i) vulnerability of women to health impacts arising out of environmental hotspots; (ii) lack of access to EMPOWERMENT adequate and clean water and (iii) safety risks. Since the current activity is an ASA, implementation of remediation technologies identified for the remediation of environmental hotspots will address the challenges identified above. 83 CLIMATE CHANGE & Extreme weather events like floods, droughts and dust storms triggered by climate change further exacerbate the problem of contaminated sites . Such events THE ENVIRONMENT can cause spreading of soil and ground water contamination, desertification, and making the environment less resilient, leading to impacts on human health, agriculture and the economy. The remediation activities identified through the ASA will contribute to climate mitigation benefits as remediation of pollution hotspots will help reduce GHG emissions. Remediation of hotspots is not included in Iraq’s NDC commitments. However, the implementation of remediation activities based on the recommendations of the project will contribute to the reducing GHG emissions. COVID RESPONSE & N/A IMPACT IMPLEMENTATION The activity is being carried out in close partnership with the MoHE and its oil pollution division. In addition, the ASA will also engage with the EPID, the ARRANGEMENTS  Environmental Council, EPIDs in identified Governorates and the MoO. The activity is being managed by the Environment, Natural Resources and Blue Economy   (ENB) Global Practice of the World Bank. KEY DELIVERABLES Currently, both activities are on track to achieve the targets. So far, the project has completed (i) satellite mapping of 77 environmental hotspots in the seven & RESULTS conflict affected governorates (component 1); (ii) identified priority sites for detailed mapping (component 2); and (iii) conducted a comprehensive eight FROM JANUARY TO module training for 30 officials at MoE. Currently activities related to detailed assessment of pollution of the sites (component 3) are being initiated. DECEMBER 2021 IMPLEMENTATION The project began during the COVID-19 pandemic, making it difficult to hire international consultants to carry out the project activities, especially the filed CHALLENGES inventory of environmental hotspots and assessment of their pollution status. To address these challenges, the team modified its implementation strategies by (i) taking the support from the European Space Agency to map the environmental hotspots through satellite imageries; (ii) training MoE officials on environmental hotspots and (iii) identifying local agencies to conduct pollution analysis of hotspots. Some delays are noted under components 3 and 4 due to the processes related to hiring a local agency for implementation. BENEFICIARIES The activity is expected to benefit local communities in the seven conflict affected governorates, including vulnerable communities such as poor, women, children and IDPs, and will also reduce health challenges and increase economic opportunities. GEOGRAPHIC The activity focuses on seven affected conflict affected governorates of Nineveh, Anbar, Salah El Din, Diyala, Kirkuk, Baghdad, and Babylon COVERAGE Water Supply and Sanitation Utility Reform Technical Assistance – BE activity P CODE P175808 GOVERNMENT Ministry of Construction, Housing, Municipalities and Public Works (MoCHMPW), MoB, BWA, BSA, BWD COUNTERPART READINESS & The Project is already ongoing. The Task Team is working with Government Counterparts for project implementation. GOVERNMENT ENGAGEMENT 84 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project STATUS  Active PROJECT To adapt global good WSS utility management practice to the FCV context of Baghdad and Basra with a view to building a national utility reform program DEVELOPMENT financed from a diversified base of International Financial Institutions lending, public and private sector financing. OBJECTIVE BRIEF PROJECT This project will provide implementation support to the institutional development aspects of the Baghdad Water Supply and Sewage Improvement Project DESCRIPTION and a program of utility reform technical assistance to the Basra WSS service provider, adapting good WSS utility management practice to Iraq’s specific FCV context. The initial implementation support will leverage the US$210 million of IBRD financing for the Baghdad WSS Improvement Project, which became effective in 2018, by working with its implementation agencies; MoB, BWA and BSA. The project will support MoB, BWA and BSA to: (i) Assess the extent and quality of existing water supply and distribution data, customer information and finance data; and plan how to improve it, including advice on how to reverse the free water provision policy under COVID-19; (ii) Provide advice on the implementation of the institutional development plan; and (iii) Document emerging lessons from Baghdad to directly feed into the Basra TA program below. In parallel, a TA program for Basra’s WSS service providers – the BWD and the BSD will draw on the emerging lessons from the Baghdad operation. The TA program for Basra will include: (i) Assessing processes of water, customer and financial management and developing a plan to modernize systems and reverse the free water provision policy under COVID-19; and (ii) Developing options for a water supply backup plan for Basra’s recurrent summer drought emergency. Based on this TA, roadmaps for the corporatization of the Baghdad and Basra WSS service providers will be developed. While the institutional setup of service delivery is different in Baghdad and Basra, developing “roadmaps” for corporatization of WSS services in both places would have common elements and could provide a template for other parts of Iraq. The corporatization roadmaps would thereby provide a springboard for developing a national program of WSS service provider reform. TIMEFRAME 2020–2023 SECTOR CONTEXT  Iraq is becoming increasingly water scarce as upstream countries implement planned developments which reduce flows in the Euphrates and Tigris rivers.   This impacts the arid governorates in central/south Iraq that rely on these two rivers for agriculture, industry and domestic water supply. Water quality worsens progressively along these rivers due to pollution from agricultural drains and untreated sewage inflows. This increases the cost and complexity of water treatment. Conflict and urban growth have exacerbated the decline of water quality and water services. The fall in public WSS provision has driven a rise in expensive privately vended water. Though an estimated US$4.8 billion in Official Development Assistance has been channeled to rehabilitation of WSS infrastructure, there are low rates of citizen satisfaction. Recent protests highlight the need for the state to deliver WSS. The aim of this activity is to complement investment in infrastructure with that in institutional development. This implementation support to Baghdad would provide a springboard to develop a parallel program of technical assistance in Basra and beyond. COMPONENTS  Component1: Implementation support to the Baghdad WSS improvement project   Component 2: Technical assistance program for Basra’s WSS service providers Component 3: Developing roadmaps for the corporatization of the Baghdad and Basra utilities and disseminating progress on reform steps to service providers across Iraq FINANCING   I3RF: US$1.75 million LINKAGES TO The project is linked to the Baghdad Water Supply and Sewage Improvement Project (P162094) OTHER PROJECTS/ INITIATIVES  85 LINK TO GOI The White Paper – “Iraq - Final report Emergency Cell for Financial Reforms” of October 2020 highlights a clear objective for reform of the water and sanitation REFORM AGENDA sector in the country, namely the development of “a water and sanitation management system that rationalizes consumption and maintains sanitary and environmental systems”. It further specifies the following outcomes: (i) Develop a comprehensive plan for the water and sanitation services sectors based on cost analysis and introducing service fee collection principle; (ii) Restructure the municipal departments and the concerned institutions in charge of water and sanitation services on a commercial or semi-commercial basis; (iii) Laying the foundations for public-private partnerships in the water and sanitation sectors and opening the sector to qualified private investors and operators; (iv) Establishing an independent regulatory body, according to the law, to provide oversight and regulate water and sanitation sectors; and (v) Finalize the Basra Grand Water Project and water and sanitation projects in the rest of the governorates. TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics GENDER EQUALITY The project takes into consideration the economic empowerment of women and girls and improving data on gender. Iraqi women today suffer from poor & WOMEN basic services including limited access to water and wastewater services, as well as high levels of violence and inequality. In Iraq, the burden of coping EMPOWERMENT with deteriorating access to WSS falls mainly on women and girls. Women and girls bear the increased burden of fetching water and meeting other basic household needs from longer distances as water resources dry up. The project will develop an emergency security water plan which will help in stemming decline and improving access to WSS, especially piped water to households, which when implemented will generate time savings for women and girls. Access to and the responsibility for managing water supply and sanitation is regularly monitored through household surveys and these data will be used to monitor sector outcomes for this grant. In addition, the development of the Customer Relation Management System will help in gathering information and data about households, and aggregated data by gender. CLIMATE CHANGE & This project indirectly supports climate adaptation and mitigation. Through adaptation - providing support and advice to the update of the water strategy THE ENVIRONMENT and develop emergency water security plans for Baghdad and Basra; and mitigation - modernization and corporatization of the Bagdad and Basra water and wastewater authorities and departments respectively and improving a CRM system. COVID RESPONSE & The development of the EWSP will help the water service providers in Baghdad and Basra to respond quickly and firmly to shocks, whether from the COVID-19 IMPACT pandemic or from other natural or man-made calamities. IMPLEMENTATION This grant is managed by MNA Water Global Practice, in close collaboration with other relevant Global Practices in cooperation with the MoCHMPW, MoB, ARRANGEMENTS  BWA, BSA and BWD. 86 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES The project provided implementation support for the institutional development aspects of the Baghdad Water Supply and Sewage Improvement Project & RESULTS (P162094) and planned for a program of utility reform TA to Baghdad and Basra WSS service providers. In the process to achieve the first anticipated result; FROM JANUARY TO Area Based Approach Plans, (i.e., Emergency Water Security Plan (EWSP)), the project has developed a diagnostic report on the 2015 strategy for water and land DECEMBER 2021 resources (Water Resources Planning and Investment Analysis; how local reallocation can help meet national water resources management objectives). The main findings are (i) Due to the challenges, both old and new, that Iraq faces, the national strategy for the development of water and land resources for the next 20 years needs to be revised to account for the lack of investment over the past five years, changes in demographics due both to internal displacement and the actual economic context, and significant changes in the hydrology of the Twin Rivers that have occurred during the past five years. In particular, the destruction of water infrastructure by ISIS, climate change impacts, and the completion of the Ilisu Dam on the Tigris River in Turkey are all significant changes that must be accounted for in planning for water and land usage; (ii) Another aspect of the Strategy in need of updating is in the role of local institutions in decisions about water allocation and use. Although central water resource institutions must retain oversight, there are opportunities to decentralize some aspects of water management that would draw on local knowledge and priorities. The report described the main principles of the national Strategy, before going on to reconsider how national, regional, and local institutions could interact with each other to develop new options for reallocating water resources in ways that would promote local interests and capabilities while living within the overall water resources limits expected to be available to Iraq by 2030. Furthermore, the project will assess the impacts of climate change on water resources, which will add substantial data in the development of the EWSP for BWA. The task team has developed a ToR to recruit consultancy services to work with them to develop it. Furthermore, this will feed into the update of the national strategy. The second result of “number of water utilities with improved financial viability (assessed based on improved service provider operating-cost coverage ratio, in percent)”; the project completed a roadmap for the digital transformation of WSS delivery. The report included an assessment of customer relations management (CRM) and billing systems, and has identified opportunities to improve the current status, and proposed future state information technology architecture (models) and key programs of work to deliver future business requirements at BWA. The task team is working with the BWA team and MoB in the procurement of the CRM and billing system to improve customer relations and revenues management. The White Paper – “Iraq - Final report Emergency Cell for Financial Reforms” of October 2020 highlights a clear objective for reform of the water and sanitation sector in the country, namely the development of “a water and sanitation management system that rationalizes consumption and maintains sanitary and environmental systems”. It specifies the importance to restructure the municipal departments and the concerned institutions in charge of water and sanitation services on a commercial or semi-commercial basis. In line with this, the project developed a ToR to study corporate governance restructuring options for improved water supply and sewerage service provision in Baghdad. While implementing the above-mentioned activities, the project team will document emerging lessons from Baghdad in short accessible notes in English and Arabic and directly feed them into the Basra TA program, which will follow the same steps and is likely to achieve the same results. IMPLEMENTATION The main challenge for the project team is to meet the client team face-to-face, which will allow for better engagement and discussion between them, and to CHALLENGES visit the client’s institutions to better understand the challenges on the ground. This will help in having a faster decision making at the client side and better understanding of the client constraints and opportunities. BENEFICIARIES The main beneficiaries are the BWA and BWD and their people who would benefit from the implementation of the outputs of the project (EWSP, CRM and billing system and corporatization roadmap). The outputs are expected to help in improving the institutional capacity to provide services to people in different categories (old, young, women children, etc.). GEOGRAPHIC The project is focused on MoB and Basra city; however, it is expected that outputs, learned skills and experiences will be transformed to other water utilities. COVERAGE  87 Technical & Economic Due Diligence to Support Iraq Southern Region Electricity Network Reinforcements – BE activity P CODE P175879 GOVERNMENT Ministry of Electricity COUNTERPART READINESS & The Bank team has been engaging with a technical committee from the Ministry of Electricity, comprising members from multiple technical units from the GOVERNMENT Ministry and regional state electricity companies, as well as the Bank’s Pan-Arab Regional Energy Trade Program team and consultants. ENGAGEMENT STATUS  Active PROJECT To provide the Iraq Ministry of Electricity with technical support to conduct load flow analysis to evaluate the capacity of planned electricity network DEVELOPMENT reinforcements in the southern region to meet the energy supply from the GCC member states through the planned interconnection with the GCCIA. OBJECTIVE BRIEF PROJECT This technical assistance would inform preparation of a proposed lending operation to support the government to reinforce the electricity network in the DESCRIPTION southern region. The TA would support the following: (i) Conducting load flow runs to evaluate the capability of Al-Faw area’s electricity transmission to meet the immediate supply gap of 500MW of imports from the GCC; (ii) Identifying the required 400kV and 132kV reinforcements and feasible connection terminals in Iraq necessary to reach the 1,800MW of electricity imports from the GCC countries in a reliable way; (iii) Developing a timeline for load growth at Al-Faw area, power plant development and any transmission expansion over the next 5–10 years; (iv) Developing recommendations for the GCCIA interconnection with Al-Faw, including design options, staging sequence and generic cost estimates; and (v) Reviewing techno-economic alternatives, providing single line diagrams, identifying technical issues and preparing cost estimates that can be used for further studies of alternatives. TIMEFRAME  March 2021–June 2022 SECTOR CONTEXT  The GCCIA is the owner and operator of a 400kV, 1,900MVA, 900km backbone transmission line that supports reserve sharing and energy exchanges among   the six GCC member states. The GoI has agreed with GCCIA on extending the transmission line (GCCIA Interconnector) from its northern end point at Al-Zour in Kuwait to Al-Faw in southern Iraq (220km inside Kuwait and 80km inside Iraq). The GCCIA Interconnector extension is estimated to cost US$220 million with a duration of 12–14 months for implementation. The GoI has agreed with GCCIA on an initial electricity import of 500MW, while the interconnector’s capacity is designed for 1,800MW. However, the current capacity of the electricity network at Al-Faw in southern Iraq (~180–200MW) is incapable of absorbing the agreed 500MW, let alone the full interconnector capacity of 1,800MW, and thus risks the line’s under-utilization, and may incur take-or-pay commitments by the GoI. This calls for improving the reliability and operational efficiency of the electricity network in southern Iraq through a range of activities designed to: (i) address network capacity limitations to meet existing power demand, (ii) meet expected future load growth, (iii) provide operational flexibility, hence improved electricity supply reliability, and (iv) reduce transmission network technical losses. The Bank is currently in discussion with the Ministry of Electricity to support the required strengthening of the electricity network in the southern region through providing the requisite technical and economic due diligence via a Bank Executed technical assistance activity; and potentially to consider a government request for lending to carry out the requisite network strengthening activities (i.e., supply and installation of transmission lines, substations and transformers). COMPONENTS  Component 1: Technical Assistance FINANCING  I3RF: US$200,000 88 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project LINKAGES TO The technical assistance supports a potential Bank investment project to strengthen the electricity network in the southern region of Iraq, which would OTHER PROJECTS/ increase its capacity to absorb the energy flow from the GCCIA interconnector as well as increased domestic generation. INITIATIVES   LINK TO GOI Axis 3. Improving key infrastructure which contributes to the advancement of future sectors. REFORM AGENDA TYPE OF SUPPORT Technical Assistance, Advisory Support, and Analytics GENDER EQUALITY The project takes into consideration the economic empowerment of women and girls. Prolonged and frequent electricity outages disproportionately affect & WOMEN women in Iraq. UN Women reports that women and girls ages 10+ in Iraq spend a quarter of their time on domestic work activities and other unpaid care EMPOWERMENT responsibilities compared to the 4 percent of time that men spend. During the summer season, many women cannot afford the cost of shared diesel generators and conduct housework in excessive heat, with temperatures sometimes rising to 56 degrees Celsius (Maier et al. 2020). Improving access would also result in positive gains around GoI’s goal to increase female labor force participation. Women’s access to reliable and affordable electricity could contribute tremendously to female entrepreneurship and ability to generate income. According to qualitative research carried out with over 100 female business owners, entrepreneurs, students, and key experts in Basra, women owned businesses reported reduced work hours, reduced profits, and loss of customers due to frequent electricity outages in 2018. Only 13 percent of working age women are in the labor force, compared to 77 percent of men (WDI 2019). CLIMATE CHANGE & The activity has no direct contribution to climate mitigation and adaptation, or the NDCs for Iraq. THE ENVIRONMENT COVID RESPONSE & N/A IMPACT IMPLEMENTATION The implementation of this TA activity is carried out through collaboration between the Ministry of Electricity and the World Bank. ARRANGEMENTS  KEY DELIVERABLES The key deliverable expected from the technical assistance activity is a technical and economic analysis (load flow analysis, identification of infrastructure & RESULTS reinforcements, economic and financial assessments). This will allow the Bank and the Ministry of Electricity to evaluate existing electricity transmission FROM JANUARY TO infrastructure in the southern region and assess needed reinforcements. DECEMBER 2021 Much of the information and data requested has been received from the Ministry of Electricity’s technical committee. This includes detailed lists and technical specifications of: (1) existing generating units with bus numbers, zone, fuel type and MW rating; (2) planned generating plants for 2020–2035; (3) generating plants modeled in the 2030 Case; (4) new transmission line additions; (5) transformer additions; (6) existing transmission lines; (7) existing transformers; and (8) planned transmission lines and transformers for 2020–2035. A preliminary load flow analysis has been conducted by the Bank team, which includes: (1) overview of the Iraq power system; (2) evaluation of the technical capability of the Iraq transmission networks (132kV and 400kV) to dispatch its own thermal and planned renewable energy generation, as well as the 1,800MW imports via a GCCIA connection; and (3) multiple scenarios and sensitivity analyses for Iraq’s connection points with the GCCIA backbone interconnector, including geographical locations and estimated costs. A first draft of the report has been completed and is undergoing further review and discussion. IMPLEMENTATION The team faced challenges in gathering the needed information and data for project preparation and implementation. CHALLENGES 89 BENEFICIARIES The direct beneficiary is the Ministry of Electricity. Indirect beneficiaries (subject to the technical and economic analysis being utilized to inform government investments in reinforcing the transmission system in the southern region) include the region’s population, estimated at over 6 million of the country’s total of about 39 million, and who account for over 30 percent of the country’s total electricity consumption. GEOGRAPHIC Southern region of Iraq, including (but not limited to) Basra, Al Muthanna, ThiQar and Missan. COVERAGE  1.3 HUMAN CAPITAL AND EMPLOYMENT Social Protection and Jobs for Poor and Vulnerable Iraqis – BE activity P CODE P171639 GOVERNMENT MOLSA and MoP COUNTERPART READINESS & Project progressing well with strong government buy-in GOVERNMENT ENGAGEMENT STATUS Active PROJECT To continue supporting MOLSA to develop a resilient SSN system and to provide the analytical base to pilot interventions to increase access to employment DEVELOPMENT opportunities for the poor and vulnerable, including youth and women. OBJECTIVE BRIEF PROJECT The project provides TA to improve social protection and job opportunities for Iraqis, with a focus on the poor and vulnerable. The social protection aspect DESCRIPTION of the assistance focuses on enhancing the system, its poverty targeting and accuracy. The jobs-related assistance focuses on two areas: (i) building a better understanding of the private sector in Iraq, its job creation, the skills of its workforce and its future needs through a large data collection effort; and (ii) establishing the foundation for Iraq’s first economic inclusion pilot through knowledge-building, knowledge-sharing and concept development. TIMEFRAME  November 2019–June 2022 90 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project SECTOR CONTEXT  The poverty rate in Iraq in 2018 stood at 20 percent (with significant variations across regions and governorates), with about 2.8 million people impoverished as   a direct result of the war. With the advent of the COVID-19 pandemic and the ensuing economic downturn, the poverty rate is expected to rise by 14 percentage points. These high levels of poverty and significant vulnerability are a result of meager economic opportunities and weak social protection systems and programs. The country’s large spending on social protection is driven by mostly untargeted, and likely regressive, subsidies (the universal Public Distribution System), which distorts public expenditures and diverts resources away from those that need them most. The budget left for non-subsidy social safety net programs is spent on the Unconditional Cash Transfer (UCT) program, which suffers from significant challenges, including coverage and effectiveness, and other programs that do not encourage proper investments in health and education. At the same time, Iraq has poor labor market outcomes, especially among vulnerable groups such as youth and women. Existing government employment programs do not adequately address the skills and job needs of the population and have limited connection to the private sector – which is already beleaguered by many challenges and remains stunted. Many workers in this environment operate informally, and consequently lack the support they need to exit the cycle of vulnerability. COMPONENTS  Component 1: Social Protection Support Program Phase 3: (i) Case Management and Behavioral Interventions: Support MOLSA to review and operationalize   the case management framework developed under Phase 2, and test behavioral interventions to encourage school enrollment; (ii) Poverty Targeting: continue the joint World Bank-Cash Working Group analytical work which seeks to identify overall social protection needs in light of the displacement crisis; (iii) Social Registry: Support MOLSA to develop its Social Registry through on-going technical assistance and capacity building for the MOLSA Information Technology teams and the Social Protection Commission; and (iv) Humanitarian/Development Nexus: Support the improvement of the MOLSA Cash Transfer Program targeting accuracy, as well as contribute to the Pensions and Social Insurance Chapter of the PER for Iraq, and support the operationalization of the recently launched Social Protection Forum, chaired by MoP. Component 2: Private Sector Analysis and Skills Assessment: Administer three large surveys to understand private sector dynamics, its job creation and the skills that it uses and needs. Component 3: Economic Inclusion Pilot for Poor Iraqis: (i) Knowledge and capacity building on productive and economic inclusion, identifying and showcasing international examples, and organizing knowledge-sharing events; and (ii) Technical and analytical work to inform the design and implementation of the economic inclusion pilot. FINANCING   I3RF: US$1.45 million; Partnership for Economic Inclusion: US$178,800 LINKAGES TO The third phase of the Social Protection Support Program builds on the first two phases of support that were completed over the past few years and is a OTHER PROJECTS/ continuation of the Bank’s effort to continue to strengthen the system and social protection services. It is also linked to the World Bank’s Human Capital INITIATIVES   Project and agenda, especially as it supports behavioral interventions that can improve the education outcomes of the population. The surveys conducted   under the Private Sector Analysis and Skills Assessment activity will benefit the upcoming operation of Protecting and Promoting Human Capital in Iraq (also I3RF funded), and the general work of the Education, Finance, Competitiveness & Innovation (FCI) and MTI GPs and could directly inform their agenda through evidence. It will also add to the existing database of similar enterprise surveys around the world, consequently becoming a public good. The EIP is linked to the larger World Bank economic inclusion agenda and work on sustainable livelihoods, as it seeks to provide a host of services and support to address the multi- dimensional aspects of poverty and vulnerability. LINK TO GOI Axis 4 -project 51 that focuses on identifying key priorities for support, integrating beneficiaries‘ databases, providing adequate protection for the poor, and REFORM AGENDA reforming the public distribution system; Axis 2, and in particular what is related to improving job creation in the private sector’s small and medium enterprises, and improving human capital through better training and acquisition. TYPE OF SUPPORT Technical Assistance and Analytics 91 GENDER EQUALITY The project contributes to the economic empowerment of women and girls. The female labor force participation rate in Iraq is estimated at 12 percent and & WOMEN female-headed households more likely to be vulnerable. This TA considers and affects women and girls in all of its components. Improving the case management EMPOWERMENT system, the targeting, and introducing behavioral interventions will directly affect poor-female headed households (who currently constitute about 32 percent of the 1.4 million current recipients of the cash transfer program). The behavioral interventions to encourage schooling under SPSP3 are also expected to encourage school enrollment for young girls. For C.2, the surveys have specific questions that relate to female employment and the various services provided to them and will allow Iraq to gain a better understanding of their role and skills in the private sector. Ultimately, the work that is being separately funded through C.3 will lead to an economic inclusion pilot (currently under preparation) that will directly incorporate a target of female beneficiaries, of at least 40 percent, and will include services that cater to their needs, such as additional training for their successful productive inclusion. CLIMATE CHANGE & The project takes climate considerations in its implementation. Against climate change-induced threats in Iraq, and through the strengthening of social safety THE ENVIRONMENT nets and the introduction of the economic inclusion pilot, the ASA is modeling the development of an adaptive social protection system that builds the resilience of households and individuals to cope, adapt and adjust to various shocks, particularly to climate change. The ASA outcomes will allow for a dynamic and scalable safety net that can continuously identify those that have fallen into poverty, address their immediate consumption gaps, ensure the protection of their human development gains through human capital-accompanying measures, as well as help them establish alternative sustainable livelihoods through productive accompanying measures . COVID RESPONSE & Most of the activities of this ASA are taking place during the pandemic. The data collection activities, especially for C.2 for example, will build a baseline for IMPACT the state of the private sector, its job creation, the skills of the workforce during the pandemic, and will directly inform policies. Moreover, analysis that has been done as part of this component of a separately funded rapid phone surveys of the private sector and workers in Iraq show key impacts of COVID-19 on the sector and on employment. The contribution to the Public Expenditure Review of this technical assistance, under C.1, also comes at a crucial time as the country tackles the economic downturn and fiscal pressures that are the direct consequences of the pandemic. Finally, the ASA also supported a revised poverty analysis given the shock of the pandemic and the fluctuation of oil prices using simulations. IMPLEMENTATION Most of the ASA activities are managed directly by the Social Protection and Jobs (SPJ) GP. The SPSP3 component has been undertaken in partial collaboration ARRANGEMENTS  with the Poverty GP. The Private Sector Analysis and Skills Assessment component will be led by the SPJ GP and in collaboration with the Enterprise Analysis Unit within the World Bank, while also having consulted with MTI. 92 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES In May 2021, in light of emerging priorities, and in consultation with partners, the following activities were suspended under Component 1: (i) the preparation & RESULTS for the Conditional Cash Transfer pilot, given suspension and uncertainty of school classes; and (ii) the targeting accuracy exercise for the Cash Transfer FROM JANUARY TO Program, due to COVID-19 and the launch of a similar exercise through a separate ASA (The Human Capital Review). DECEMBER 2021 The following activities are ongoing but delayed: (i) C.1- the behavioral intervention; an NGO was hired to implement it; (ii) field work for poverty targeting assessment that seeks to validate initial findings; and (iii) C.2- Private sector surveys. The following activities were newly added: (i) C.1- support for MOLSA for the establishment of its social registry; (ii) C.1- support for the dialogue on pensions reform; (iii) C.1- support for the dialogue on subsidy reform; and (iv) collaboration with the World Bank Poverty Global Practice to update the current poverty targeting system based on the results of the upcoming IHSES survey. Component 1- SPSP 3: The Social Protection component is progressing well, and the team is supporting MOLSA with systems strengthening. Results achieved to-date include: (i) assessment of the ministry’s ICT systems and infrastructure; (ii) cleaning of existing databases; (iii) installation of needed servers; and (iv) substantial capacity building and on-the-job training to the IT team of MOLSA to clean the database using the data quality and cleaning tool, cybersecurity to strength the system security and system development training to enhance, and fill the gaps founded in the system, using the latest technology. An update on poverty and vulnerability following the pandemic and the fluctuation of oil prices was also achieved with results discussed, presented and shared with the GoI through a report during 2020. Moreover, joint World Bank-Cash Working Group poverty targeting work has been completed and will soon be published and discussed in various seminars. The reduced pilot to test behavioral interventions on households is close to completion and findings will be finalized by the end of 2021. The work on the Pensions and Social Insurance Chapter of the PER has also been completed. Component 2- The first set of informal business activity surveys have been launched in August 2021 in three out of the four cities (Baghdad, Basra and Sulaymaniyah), with the addition of the city of Najaf following in December. The Enterprise Surveys (which include microenterprises in four cities, and small, medium, and large enterprises in 10 cities) was launched. This has followed extensive work over the previous year to establish a sample frame, relevant grids for the informal business surveys, digitalization and translation of questionnaires, and training enumerators and interviewers. Data collection is expected to be finalized by the end of May 2022. IMPLEMENTATION The key challenges relate to delays due to COVID-19. CHALLENGES BENEFICIARIES The GoI in general, specific line ministries, namely MOLSA, and the population of Iraq, especially the poor and vulnerable, who may benefit from the systems building agenda and future reforms and policies that are informed by this technical assistance. GEOGRAPHIC National level for all activities, and sub-national levels: the microenterprise survey will cover Baghdad, Basra, Erbil and Sulaymaniyah; the informal business COVERAGE  activity survey will cover Baghdad, Basra, Najaf and Sulaymaniyah and the behavioral intervention was tested on households in Basra and Kirkuk. 93 Protecting and Promoting Human Capital in Iraq – An Economic Inclusion Pilot (EIP) – BE/RE activity P CODE P174422 GOVERNMENT MOLSA COUNTERPART READINESS & The pilot concept was first discussed with the MOLSA during a mission to Baghdad in March 2020 following preliminary discussions in 2018. Between March GOVERNMENT and July of 2020, international experiences were shared with staff from the Ministry, through presentations by the World Bank team, as well as presentations ENGAGEMENT arranged virtually with Yemeni and Egyptian counterparts who have launched similar programs in their countries. These sessions included staff from the various sections under the Directorate of Labor and Vocational Training (DLVT) of the ministry, ranging from the planning section, the training section, the microloans section, the incubators section and others. From July to October 2020, the World Bank worked with the DLVT to further decide some pilot parameters of location, economic activity focus, beneficiaries and implementation arrangements, including a virtual project preparation mission in October with MOLSA and the MoP. Members of the project’s management team have been tentatively identified. Moreover, the World Bank has carried out assessments of the financial management, procurement, and environmental and social safeguards capacities of the Ministry, in line with IPF rules and regulations. The project is entering the appraisal stage and is expected to be approved by the Bank in March 2022. STATUS  Pipeline PROJECT To create sustainable livelihood opportunities for 2,200 poor Iraqis, including youth and women, and contribute to the alleviation of their poverty. DEVELOPMENT OBJECTIVE BRIEF PROJECT The project supports the GoI to create sustainable livelihood opportunities for poor Iraqis, and therefore promote longer-term income-generating activities and DESCRIPTION alleviate poverty. The project will offer training, coaching, mentoring and grants to 2,200 households in the south to start self-employment activities. The pilot will be implemented in the rural area of ThiQuar and will target households selected from beneficiaries of the Cash Transfer Program which is administered by MOLSA. The pilot will undergo an impact evaluation that will help inform poverty-alleviation and sustainable livelihood agendas in the country and pave the way towards the possible scale-up of the intervention. TIMEFRAME  April 2022–September 2024 94 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project SECTOR CONTEXT  The recent pandemic, the fall in oil prices, and the ensuing economic downturn are expected to further exacerbate poverty, and to increase the poverty rate   by up to 14.4 percentage points. Many households in Iraq have already lost their main sources of income and are likely to have resorted to coping mechanisms that leave them further vulnerable to poverty. Since April 2020, the GoI has taken measures to address the increased levels of poverty and vulnerability. These include launching a program that aims to provide temporary income support to those who have been impacted by lockdown measures; and the “1 million Food Baskets for the Poor” program to alleviate the effects of COVID-19. However, this response, while timely at the beginning of the pandemic, does not address the more dire needs of the country’s poor and vulnerable in the short and medium terms. In addition to increased poverty and vulnerability, Iraq suffers from persistently poor labor market and livelihoods outcomes, notably increased unemployment (estimated by the ILO in 2020 at 13.7 percent, from 8 percent in 2010), particularly among women, high share of youth that are idle; low female labor force participation (estimated at 11.6 percent); and high informality (over 90 percent of private sector workers in Iraq). Moreover, the average income of private sector workers is low, with large gender differentials - a mean of US$71 a month for women, compared to about US$350 for men. This highlights challenges to both the quantity and quality of job creation and sustainable livelihoods in Iraq, especially in the private sector. While the GoI has several programs to support the poor and vulnerable, there has not been a comprehensive approach to help individuals and households beyond cash assistance. Many countries around the world had begun to implement “Cash Plus” programs which incorporate a more holistic approach to poverty by providing training and livelihood support, including the provision of assets to start or expand activities. In Iraq, training for self-employment activities that can support sustainable livelihoods, such as business development, financial literacy and others, are limited, sparse or non- existent. Finally, MOLSA’s microfinance loans, while potentially an important instrument of support, especially for the poor and vulnerable, have little evidence of their impact or their targeting and often require a sponsor that guarantees collateral – an option rarely available to the poor. COMPONENTS  Component 1. Implementation of the EIP: (i) Phase 1: Preparation which consists of market analysis, beneficiary profiling and awareness campaign, registration   and household selection; (ii) Phase 2: Delivery of non-financial and financial interventions which include beneficiary training, asset transfer, and coaching and mentoring; and (iii) Phase 3: Monitoring and Impact Evaluation Component 2. Project management and monitoring FINANCING   I3RF: US$5 million (US$ 600,000 BE; US$4.4 million RE). The pilot will be further supported by the Partnership for Economic Inclusion of about US$100,000 to conduct the baseline survey of beneficiaries and the control group for impact evaluation. LINKAGES TO The EIP is linked to the larger World Bank economic inclusion agenda and work on sustainable livelihoods. OTHER PROJECTS/ INITIATIVES   LINK TO GOI (i) Axis 4 “Providing key services, and rationalizing and directing social welfare, giving priority to the poor, and offering them protection during and after the REFORM AGENDA reform process; (ii) Axis 2, particularly what focuses on promoting agriculture and through its focus on human development. TYPE OF SUPPORT Analytics and pilot activity that can be scaled up or inform a broader recovery program GENDER EQUALITY The project contributes to the economic empowerment of women and girls. Unemployment among women and low female labor force participation (11.6 & WOMEN percent) are key challenges in Iraq. The EIP will directly target at least 45 percent of its beneficiaries to be females, be they heads of households or members of EMPOWERMENT a household. Moreover, the pilot will cater to these beneficiaries through specific support in terms of training, coaching and mentoring, bearing in mind other considerations during the design phase such as childcare services and social norms. CLIMATE CHANGE & The project takes climate considerations in its implementation. The pilot specifically targets beneficiaries of the Cash Transfer Program and will support THE ENVIRONMENT sustainable livelihood activities, especially agriculture and farming in order to build household resilience to shocks, while also utilizing best practices in terms of these activities and ultimately supporting Iraq’s resilience to climate change. 95 COVID RESPONSE & This project seeks to mitigate the pandemic’s impact on livelihoods and labor market outcomes, and to support recovery. The challenge of job creation and IMPACT sustainable livelihoods is ever more pressing as the pandemic amplifies Iraq’s poverty and vulnerability. The pilot will also allow the Ministry to initiate a broader and more effective set of interventions that could transform into wider programs and policies. IMPLEMENTATION The EIP will be managed by MOLSA, through a PMU within the DLVT. From the Bank’s side, the project will be led by the SPJ GP in collaboration with selected ARRANGEMENTS  GPs, namely Poverty and Agriculture. KEY DELIVERABLES Project is still under preparation & RESULTS FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION The project faced delays due to compliance related discussions with donors. The issue was resolved as of September 2021. CHALLENGES BENEFICIARIES 2,200 beneficiaries, to be selected from the Cash Transfer Program administered by MOLSA (who are and will continue to receive their cash transfers throughout the pilot). 45 percent of the pilot’s beneficiaries will be women. GEOGRAPHIC The pilot will target the southern governorate of ThiQuar, which suffers from high poverty rates. COVERAGE  Support to Education and Skills Development in Iraq – BE activity P CODE P171165 GOVERNMENT MoED, MoHESR COUNTERPART READINESS & Close working relationships with various MoE departments (Financial Affairs; Curriculum Directorate; Teacher Training and Development Institute; Assessment GOVERNMENT and Examination Directorate); MoP and MoHESR. ENGAGEMENT STATUS  Active PROJECT To strengthen the GoI’s capacity to provide quality education services for improved Human Capital development. DEVELOPMENT OBJECTIVE 96 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project BRIEF PROJECT This programmatic ASA seeks to strengthen the GoI‘s capacity to provide quality education services. The Iraq education sector is facing a multitude of DESCRIPTION challenges across key dimensions (equity, quality, access, input, capacity), exacerbated by multiple crises. The lack of diagnostics, strategies, and proven pilots prevent the GoI from undertaking evidence-based planning for many competing demands to improve human capital development. This programmatic ASA aims to strengthen capacity for delivery of quality education services through three pillars: (i) Improved education sector inputs and diagnostics; (ii) Strengthened education strategies and policies; and (iii) Higher education sector pilots to promote labor market relevant skills development. The activities finance knowledge exchange, capacity building, analytical work and small pilots - filling important knowledge and capacity gaps to re-align the education system to focus on improved Human Capital development. In addition, the activities create the necessary evidence base and institutional capacity needed for future education and human capital development Recipient-Executed activities and lending operations. TIMEFRAME  December 2019–June 2022 SECTOR CONTEXT  Years of conflict in Iraq have harmed the education sector. Iraq has one of the lowest Human Capital indicators in the region, further compounded by the recent   pandemic. COVID-19 has led to school closures from March to November 2020, with an estimated loss of 0.6 in learning adjusted years of schooling from an already low baseline of four years. The low levels of human capital development, coupled with limited opportunities to gain job-relevant skills, have translated into worsening economic and social outcomes. The limited data points to very low learning and skills levels conveyed by the education system across all levels – even before the crisis. The education sector in Iraq faces a multitude of challenges, including equity, access, quality, governance, and assessments and financing across all levels of education. The lack of diagnostics, strategies, and proven pilots prevent the GoI from undertaking evidence-based planning to cater to many competing demands, and to improve human capital development. COMPONENTS  Component 1: Improved Education Sector Inputs and Diagnostics: (i) Service Delivery Indicator (SDI) Survey to assess strengths and shortcomings of schools   and enable the GoI to make strategic, cost-effective decisions for teacher recruitment, employment, and training policies; (ii) Mobile Data Collection (MDC) platform technical support to support the GoI in setting up a platform, while building capacity for the use of a comprehensive Education Management Information System; (iii) School construction policy and Teacher Allocation Diagnostic and Guidance Note to support the GoI in developing a data-informed school construction and teacher allocation policy; and (iv) Public Expenditure Review to analyze the efficiency, adequacy, and equity of expenditures by MoE, MoHESR, and MOLSA and to provide policy recommendations to support enhanced accountability and service-oriented provision of public institutions; and (v) Iraq Education Sector Reform Note published in 2021 Component 2: Strengthening Education Sector Strategies and Policies: (i) National Education Strategy, in cooperation with UNESCO, to guide the future development of the education system; (ii) On-Demand Technical Assistance to respond to changing demands for support by the GoI in a post-conflict situation: COVID-19 briefs and best practice guidance notes for remote learning during school closure, and strategies for school re-opening; and (iii) Additional Iraq National Assessment Strategy Framework (since November 2020), to support the GoI to develop a holistic strategy on how to assess learning. (Please note change of scope: The Early Childhood Education Strategy, which was included in the Concept Note, is being prepared with the support of UNICEF and thus is no longer part of the planned activities. The associated funds have been allocated to the Iraq National Education Strategy). Component 3: Skills Pilot: Higher Education sector pilots to promote skills (Competitive Fund Initiative) to support higher education institutions to respond to the needs of the labor market, particularly among university graduates. Call for proposals will be launched among Iraqi public universities to submit short-term complementary programs, in partnership with the private sector, to address the skills gap. FINANCING   I3RF: US$1.5 million. In addition, US$300,000 BE financed by the Global facility for Disaster Reduction (GFDRR) and Japan-World Bank Program for Mainstreaming Disaster Risk Management in Developing Countries. LINKAGES TO Leverages EODP and complements on-going engagements of other donors with MoE (UNICEF, UNESCO) and MoHESR. OTHER PROJECTS/ INITIATIVES   97 LINK TO GOI The Iraq White Paper lays out the improvement of Human Development Outcomes through education under pillars 2 and 4. The project supports the following REFORM AGENDA priority areas of the GoI WP and Reform Agenda: Area 1: Skills for improved learning and employability; Area 2: Improved efficiency and equity in education governance and spending; Area 3: School Infrastructure and Human Resource Planning; Area 4 : Strategy for Education and Training. TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics. GENDER EQUALITY Contributes to the economic empowerment of women and girls, improving data on gender and improving laws and policies affecting women through: (i) & WOMEN Capacity building which includes female ministerial staff; (ii) Strategies and policies under the ASA which will benefit all Iraqi children; (iii) PER and national EMPOWERMENT education strategy to include gender disaggregated analysis and targets. Gender gap becomes prevalent at higher levels of education. The data collected by the SDI survey, for example, will be disaggregated by gender to highlight differences, if any. In addition, implementing gender-nuanced learning interventions based on the findings of the SDI, PER and National Education Strategy is expected to benefit girls and women. Collecting data on learning outcomes under the SDI, for girls and boys, will produce relevant information (particularly including gender in the data collection and analysis) that will enable the GoI to analyse these outcomes against measures of equity (including issues of gender) and to make strategic, cost-effective decisions to support the most marginalized and vulnerable groups, among whom are girls. CLIMATE CHANGE & The GFDRR funded preparation of criteria for disaster risk reduction and improved learning environments will support GoI to understand and reduce vulnerability THE ENVIRONMENT to natural hazards and climate change. COVID RESPONSE & All activities have been adjusted to respond to the COVID-19 pandemic and incorporate insights and/or provisions to mitigate its effects (i) The Iraq National IMPACT Education Strategy (INES) will include a focus on COVID-19 and building back better; (ii) The PER analyzes impacts of school closure due to COVID-19 on learning; (iii) The SDI has been expanded to include a parent module to gauge how well distance learning at home has worked and the effects of school closures on caregivers; and (iv) A number of the shortlisted proposals under the skills pilot address issues that respond to COVID-19, such as remote learning (online services), health related initiatives, and online services. In addition (v) the Iraq Reform Note proposes an immediate crisis response to mitigate the effects of COVID-19 on learning. IMPLEMENTATION This grant is managed by the Education GP, in collaboration with other GPs, including SPJ, Health, MTI, Gender, FCI, and the Development Economics Unit. ARRANGEMENTS  KEY DELIVERABLES In 2021, the Human Development Public Expenditure Review, which included a chapter on Education, was published and launched. The PER analyzed the efficiency, & RESULTS adequacy, and equity of expenditures by MoE, MoHESR, and MOLSA, and recommended policies to support enhanced accountability and service-oriented provision FROM JANUARY TO of public institutions. A draft of the National Education Strategy was completed by December 2021. The school infrastructure policy and the Teacher Allocation DECEMBER 2021 Diagnostic and Guidance Note will be finalized over the next two months. In addition, the teacher allocation policy will be completed by end of 2021. A school level SDI survey to measure learning and factors relevant to learning (resources, teacher knowledge, home background, etc.) has been prepared. Data collection had to be postponed from school year 2020/2021 to the current school year 2021/2022 and will take place over the coming months. Two new deliverables were added in 2021: (i) Iraq Education Reform Plan was prepared and published. The reform plan builds on the Iraq reform plan (White Paper) by proposing short- and medium- term reforms in the sector; (ii) Assessment Strategy Framework, at the request of the MoE will be finalized February 2022. The Competitive Fund (CF) Initiative generated great interest among Iraqi tertiary education institutions (TEIs) and they submitted some 300 concept proposals after the initial call for proposals issued by MoHESR. After the screening by the CF Committee which consists of representatives from relevant ministries (including MoP and MoF), universities and the private sector, about 100 of these concept proposals were invited to submit a full proposal. The Committee’s further evaluation produced 30 of these proposals for entering the final selection for future funding. This bottom-up initiative has generated innovative ideas and, more importantly, the mind-set change towards labor market needs. Based on this positive experience, in order to continue the effort in building institutional capacities in this direction, a proposal for an investment project was made to and subsequently approved by the I3RF Steering Committee (i.e., Support to Tertiary Education Project P175694, see below for details). IMPLEMENTATION School closures or remote learning in the school year 2020/2021 necessitated postponement of SDI survey data collection until the current school year CHALLENGES 2021/2022. 98 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project BENEFICIARIES Students, youth, women, and marginalized groups. MoE, MoP, MoF, MoHESR and MOLSA will benefit from increased capacity to undertake evidence-based reform. GEOGRAPHIC National level. COVERAGE  Innovations towards Learning in Lagging Iraqi Governorates – RE activity P CODE P175721 GOVERNMENT The RE grant will be managed by the PMT from the EODP-AF Education Component, in close coordination with the relevant technical departments (curriculum, COUNTERPART assessment, teachers, e-learning, planning, finance) within the MoE and MoP. Implementation arrangement will use and build on a well-functioning and experienced PMT, that has well established operations and communication channels with the respective governorates and local authorities (the geographic coverage under EODP and this grant is the same). In addition, coordination and cooperation on Education activities between the Ministry of Education, the MoP and the PMT is well-established through ongoing EODP-AF and ASA activities. READINESS & The activities respond to current government priorities. The WB was asked to build on the current engagement to scale up our support to the education sector GOVERNMENT in Iraq both to address immediate needs stemming from the current COVID-19 crisis and pursue medium- and long-term development objectives of the sector. ENGAGEMENT In addition, the activities build on and complement ongoing education operations (for example, expanding and building on teacher training activities under EODP Education component) and technical assistance (SESDI ASA), and leverage capacity built under those to allow for holistic and timely support to address the most urgent education sector needs. As mentioned above, this RE grant will be managed by the PMT from the EODP-AF Education Component, in close coordination with the MoE and MoP. This implementation arrangement will use and build on a well-functioning and experienced PMT. STATUS  Pipeline PROJECT To enhance teaching practices and improve literacy and numeracy skills among the most vulnerable primary students in lagging governorates in Iraq. DEVELOPMENT OBJECTIVE BRIEF PROJECT This project supports the most vulnerable students to acquire early literacy and numeracy skills through support to 1) schools to create a better resourced DESCRIPTION learning environment and provide catch-up classes, 2) comprehensive teacher training and development to teachers and 3) caregivers to support student learning at home, to holistically promote students’ learning. The project will support innovative education service delivery in three vulnerable governorates. This project will provide a demonstration effect and allow for later scale up while leveraging ongoing project activities, available resources and implementation capacity, building on proven interventions and already established materials and partnership channels. This is a unique opportunity to leverage various Education interventions to provide a comprehensive approach to learning pilot that is urgently needed to mitigate further learning loss. The combined effects of the proposed interventions will be much larger than the additional investment proposed under the grant. TIMEFRAME  January 2022–October 2023 99 SECTOR CONTEXT  Human capital development is imperative to achieve sustainable economic growth and overcome fragility in Iraq. Over the past decades, countries around the   world have invested in human capital as a driver for economic growth. Investments in human capital are urgently needed in Iraq to spur economic prosperity. At the heart of Iraq’s human capital crisis is a learning crisis – which is exacerbated by the effects of COVID-19 on education service delivery. A child born in Iraq today will reach, on average, only 41 percent of her potential productivity when she grows up, as measured by the World Bank’s Human Capital Index (HCI) (World Bank 2020). Iraq has one of the lowest human capital indicators in the region and the lowest among Mashreq countries. Iraq’s poor performance on the HCI is largely attributed to the education outcomes calculated for the index. Based on current enrollment rates, an Iraqi child can expect to complete only 6.9 years of schooling. However, when considering the amount of learning that takes place, this child will achieve only 4.0 learning-adjusted years of schooling (LAYS) by age 18. As a result, 40 percent of the (already low) time spent in school fails to translate into productive skills when this child enters the workforce (World Bank 2020). This is an alarmingly low level of learning, the lowest in the MENA region. Years of conflict and structural inefficiencies have resulted in an education system in Iraq that is not conveying the foundational skills and learning needed to succeed in life. The 2012 Early Grade Reading Assessment (EGRA) and Early Grade Mathematics Assessment (EGMA) highlight large learning gaps in the foundational years. By grade 3, the vast majority of students assessed had not yet acquired sufficient foundational skills – with over 90 percent of students not reading with comprehension. Ongoing school closures will likely lead to another “lost year of learning” and cause even more children to drop out of school, especially from the poorest households. In an effort to mitigate learning losses, MoE introduced remote learning through an online learning platform as well as TV broadcasting. However, the focus has so far been on secondary education, particularly the higher grades sitting for exams, and favoring those with access to technology. In other words, inequitable access to education basic services has amplified existing inequalities, increasing the risk of school-drop out, especially among the most vulnerable students. Innovative education delivery approaches are necessary to provide urgent support, mitigate learning losses among the most vulnerable, and provide evidence to build a resilient education system that ensures learning for all children in Iraq. COMPONENTS  Component 1. Strengthen teaching practices of Arabic and Mathematics primary teachers in early literacy and numeracy: (i) Providing training to Arabic and   Mathematics primary teachers on structured pedagogy and using guided lessons for literacy and numeracy skills, and implementing formative assessments (ii) Implementing continuous learning through peer learning (digital and face to face) and teacher coaching by mentor teachers. Component 2: Support parents and schools with tailored learning tools to serve students while they learn at home or at school: (i) Providing primary students with supplementary literacy and numeracy booklets to promote Reading for Pleasure, (ii) Developing guidance materials (online and offline) to help parents/ caregivers to their children’s learning and well-being, (iii) Offering school grants to provide basic supplies for teachers’, schools’, and students’ immediate needs. Component 3: Capacity building for school leaders, DOE and MoE and Monitoring and Evaluation: (i) Developing a customized school grant manual and training of school management committees., (ii) Supporting implementation of the National Assessment Strategy and participation in an international large- scale assessment, (iii) Re-defining the role of educational supervisors located at the DOE level and supporting them in their new functions supporting the mentor teachers in schools, (iv) Designing project Monitoring and Evaluation (M&E) systems for tracking student learning and teacher performance. FINANCING I3RF: US$10 million LINKAGES TO The activities will build on and leverage 1) the teacher training developed and implemented under EODP-AF, 2) the School-Based Management program pilot OTHER PROJECTS/ supported by UNICEF, 3) communication tools between schools and parents, such as from Save the Children, and 4) early literacy and numeracy materials being INITIATIVES   developed under the MENA Regional Education COVID-19 Response Project (P175697). In addition, activities under the grant will benefit from analytical pieces   and education sector insights derived from ASA deliverables such as the Service Delivery Indicator Survey, the Public Expenditure Review; and underlying data collection and ongoing policy dialogue. LINK TO GOI The Iraq White Paper lays out the improvement of Human Development Outcomes, specifically through education, as a priority under pillar 2 and for supportive REFORM AGENDA education infrastructure under pillar 4. TYPE OF SUPPORT Investment Project Financing 100 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project GENDER EQUALITY The project contributes to economic empowerment of women and girls and improving data on gender. Gender gaps becomes prevalent at higher levels of & WOMEN education. Promoting early literacy and numeracy skills has a proven, positive impact on children’s educational trajectory. In a country like Iraq in which EMPOWERMENT dropout among girls in higher grades is more pronounced, it is imperative to support quality education for both girls and boys early on. Female beneficiaries are primary and secondary school students, primary and secondary school teachers, female school management, female parents and caregivers, and female MOE and DOE officials who will benefit from capacity building. In addition, the project will generate gender-disaggregated data. CLIMATE CHANGE & N/A THE ENVIRONMENT COVID RESPONSE & The proposed activities will use innovative service delivery approaches, for example, using a blended approach for online and offline content delivery – IMPACT to better address the short-term and urgent needs of the Iraqi education system arising from the current health crisis (and related school closures). These innovative approaches will function as best-practice pilots, to inform scale up and future recovery lending operations. In addition, this project directly responds to government priorities laid out in the recent GoI White Paper, and key priorities emerging from the recent COVID-19 crisis and related school closures. The proposal focuses on a community approach to learning, especially at home with additional support, as this has become an increasingly important medium for learning given school closures. Importantly, the project will focus on school grants to prevent school-dropout of the most marginalized students – which are at the greatest risk of dropping out. The focus on foundational skills, such as literacy, has proven to be one of the most relevant skills, given the necessity of distance and remote learning due to COVID-19. IMPLEMENTATION The grant will be managed by the MoE PMT from the EODP-Additional Financing Education Component, in coordination with technical departments within ARRANGEMENTS  MoE and MoP. KEY DELIVERABLES A Project Advisory Committee comprising MoE and MoP representatives has been established and meets regularly with the WB team. Project preparation is & RESULTS making good progress, and Appraisal was completed in December 2021. Negotiations are scheduled for January 2022. FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION N/A CHALLENGES BENEFICIARIES Students, Teachers, Parents, Schools in three of the most vulnerable governorates (Al Quadsya, Al Muthanna, Missan), and MoE and DoE local officials GEOGRAPHIC The project will be implemented in three of the most vulnerable governorates: Al Quadsya, Al Muthanna, and Missan. COVERAGE 101 Support to Tertiary Education in Iraq – BE/RE activity P CODE P175694 GOVERNMENT MoHESR COUNTERPART READINESS & The project design was consulted with MoHESR, MoP, MoHE, MoA, Ministry of Electricity and others. The government request letter for this project is in process. GOVERNMENT ENGAGEMENT STATUS  BE: Active; RE: Pipeline PROJECT To develop institutional capacity in disciplinary areas of tertiary education that support national development priorities DEVELOPMENT OBJECTIVE BRIEF PROJECT To support GoI’s effort in addressing employability of university graduates. The project will finance and support the following activities: (1) supporting the DESCRIPTION development of projects for establishing centers of excellence in two national development priority areas – agriculture and renewable energy; (2) developing and increasing training capacity and outputs in solar energy; (3) strengthening partnerships between tertiary education institutions and the private sector and international institutions for improving graduates’ employability through a competitive fund program pilot; (4) developing and piloting a graduate monitoring mechanism; and (5) project coordination and monitoring. The main beneficiaries from this grant will include: (i) students, graduates and faculty members (including females) for their upgraded knowledge and skills to meet academic standards and labor market needs; (ii) MoHESR and involved tertiary education institutions for their improved programs and capacities; and (iii) the tertiary education sector for its established new mechanisms for system improvement such as competitive fund program, partnerships with the private sector, and graduate monitoring; and (iv) students, graduates, alumni and workers who received training and are able to find jobs or start their own businesses to create employment opportunities in the solar energy industry. TIMEFRAME  December 2021–October 2023 SECTOR CONTEXT  Tertiary education in Iraq has experienced a rapid expansion (an increase of 26 percent and 42 percent for number of universities and number of student   admissions, respectively) in recent years but its access (only 19 percent gross enrollment rate) remains low in comparison with other countries in the MENA region. The increased demand for tertiary education has put tremendous pressure on the public tertiary education system in terms of resources. With a 25 percent increase in enrollment in public universities, spending on tertiary education has declined, which may negatively impact system outcomes. Unemployment and inactivity of tertiary graduates in the labor market is a major concern for both the government and tertiary education institutions in Iraq. While data on university graduates’ unemployment is unavailable, anecdotes suggest that the rate is comparable (or even higher) to that for youth unemployment which is over 25 percent in the country. Unemployability reflects a mismatch between supply and demand for skills in the labor market. Emerging economic sectors such as solar energy present new job opportunities for appropriately skilled workers but the tertiary education sector is not prepared to meet such demand. The tertiary education sector in Iraq is unable to keep up with global trends and respond to national/local socioeconomic development needs. The COVID-19 pandemic has exacerbated the situation. Despite the government’s efforts, many students have not been reached by distance learning and many tertiary education institutions struggle to deliver courses not suited to online teaching. Lockdown and social distancing have made already limited practical training almost impossible, further exacerbating the skill-mismatch facing tertiary graduates. 102 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project COMPONENTS  Component 1: Developing institutional capacity in disciplinary areas that support national development priority sectors. This component focuses support in   two national development priority sectors – agriculture and renewable energy – through support to (i) the preparation for establishing a center of excellence (CoE) in each of these priority areas; and (ii) the development and delivery of training/incubation in solar energy for meeting the immediate needs derived from the latest Government’s climate change initiative. Component 2: Strengthening partnerships with the private sector and international institutions for improving graduates’ employability. This component supports MoHESR to establish a Competitive Fund Program (CFP) to foster partnerships between tertiary education institutions and the private sector and international institutions in addressing graduate employability and equipping students with market-relevant skills by (i) carrying out a CFP pilot with nine (9) competitively selected proposals through a transparent process; and (ii) establishing an institutional framework for CFP. Component 3: Project coordination and monitoring. This component supports MoHESR to (i) coordinate and manage day-to-day project implementation operations; and (ii) develop and pilot a graduate monitoring mechanism. In addition to these three components, the project will also be supported by a set of technical assistance activities financed by BETF, including (a) project preparation in areas such as fiduciary assessment, environmental and social safeguards frameworks (ESF); (b) facilitation of international experts and knowledge sharing for development of CoEs in two priority areas; (c) development of CFP protocols and institutional framework (as mentioned in the above Component 2), and helping selected proposal teams to improve their proposals and develop realistic implementation plans; (d) development of a graduate monitoring system (as mentioned in the above Component 3); and (e) analytic work for supporting MoHESR’s evidence-based policymaking and interventions for further reforms of the tertiary education sector such as financing, quality assurance/governance, data, etc. FINANCING  I3RF: US$5 million RETF, US$1 million BETF LINKAGES TO This is the first WB engagement and operation in the tertiary education sector in Iraq. It is possible that synergies may emerge during implementation with OTHER PROJECTS/ other relevant initiatives such as in the renewable energy area. INITIATIVES   LINK TO GOI The proposed project supports the Priority Area 2.6 Human Development and Strategies of Iraq White Paper, particularly in the area of “linking educational REFORM AGENDA outcomes with future needs of the labor market”. It also supports two national development priority areas outlined in the White Paper – Agriculture and Renewable Energy, and builds university capacity in training, applied research and knowledge transfer in these two areas. TYPE OF SUPPORT Technical Assistance, Advisory Support, Analytics and Financial Support (Seed Funding). GENDER EQUALITY Contributes to the economic empowerment of women and girls and could potentially contribute to improving laws and policies affecting women through the & WOMEN technical assistance. Data on gender issues are scarce but the HD PER shows that gender disparities in access to education are relatively small in comparison EMPOWERMENT with the effect of disparities in household income and location. One may infer from the high unemployment rate of tertiary education graduates that female graduates may fare worse due to limited opportunities and social norms. The proposed project is meant to improve institutional capacity to help address graduate unemployment and will provide equal access and opportunities to males and females. In measuring its beneficiaries, the data will be disaggregated by gender. CLIMATE CHANGE & The proposed project will contribute to climate mitigation and adaptation through graduates with the knowledge and skills to help their employers and THE ENVIRONMENT communities to tackle climate related issues. In particular, the project will finance training and incubation in solar energy as an alternative energy to help address power shortages of households (installation, maintenance, system management, etc), therefore contributing to NDCs for Iraq. COVID RESPONSE & N/A IMPACT 103 IMPLEMENTATION MoHESR as the government agency responsible for tertiary education in Iraq will be the implementing agency for the proposed project. It has the oversight ARRANGEMENTS  role of the Project’s preparation and implementation. MoHESR will provide technical guidance to the project implementation through its appropriate technical   departments and will establish a Project Implementation Unit (PIU) to coordinate and manage daily activities. The project implementation and management will take a hybrid approach to ensure quality control and flexibility. Components 1 and 3 will be implemented by MoHESR. Component 2 will be implemented by the selected CFP proposal teams and their respective host universities. Each of these universities will form a small Project Management Team (PMT) for managing daily implementation activities of their approved proposals and Implementation Plans. An agreement will be established between MoHESR and each host university for accountability. The PIU will play a liaison role with all the parties involved in the implementation. KEY DELIVERABLES 1)To have the project approved and ready for implementation and 2)To start the analytic TA i.e., concept outline produced and consultants hired. & RESULTS FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION Unclear at this point as the implementation has not started yet, but institutional capacity and time may be challenging. CHALLENGES BENEFICIARIES The main project beneficiaries include: (i) students, graduates and faculty members (including females) for their upgraded knowledge and skills to meet academic standards and labor market needs; (ii) MoHESR and involved tertiary education institutions for their improved programs and capacities; (iii) the tertiary education sector for its established new mechanisms for system improvement such as competitive fund program, partnership with the private sector, and graduate monitoring; and (iv) students, graduates, alumni and workers who received training and are able to find jobs or start their own businesses to create employment opportunities in the solar energy industry. GEOGRAPHIC National level. Geographic areas covered by the CFP pilot are eight (8) governorates COVERAGE  Iraq Road Maintenance Microenterprises Grant Project – RE activity P CODE P171446 GOVERNMENT MoCHMPW COUNTERPART READINESS & Government counterpart has been duly engaged in project preparation, including technical elements and safeguards instruments. Grant agreement is ready GOVERNMENT for signing and awaiting action by the government counterpart. ENGAGEMENT STATUS  Pipeline PROJECT To provide entrepreneurship and employment opportunities to rural inhabitants in lagging areas of Iraq and improve their level of road access to markets and DEVELOPMENT critical social services. OBJECTIVE 104 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project BRIEF PROJECT The project would provide financing for 50 labor-intensive rural road maintenance sub-projects to be implemented by microenterprises. The sub-projects will DESCRIPTION consist predominantly of routine and small-scale preventive maintenance works of roads and road-related infrastructure. Capacity building for entrepreneurial, managerial, and technical aspects for implementing agencies and individuals in project area would provide a base for project implementation and sustainability. The project will also finance recruitment of experienced consultants in project management, safeguards, M&E, financial management, and procurement to support implementing agencies in establishing the new concept for maintenance. TIMEFRAME December 2021–September 2023 SECTOR CONTEXT  Iraq has a significant backlog of road improvement programs and maintenance of assets. The budgetary funds allotted for maintenance are insufficient, but   there may be also the risk of underutilization because the contractors are not geared to take up these works. In such a situation, the plans for road development and maintenance for the coming years can be seriously affected if the contractors are not able to rise to the occasion and take up the challenges. This is specifically the case for rural roads, i.e. roads in remote and usually poor areas that are practically at the bottom of prioritization list for the management authorities, but also cannot attract the contractors’ attention due to the location of the works and the size of the typical contracts. The poor condition of the transport infrastructure and lack of transport services has significantly affected the mobility of Iraqis, particularly the poor, and especially in rural areas. Most of Iraq’s population is inadequately served by unpaved roads, with the worst conditions experienced disproportionately by certain income groups. Investments in Iraq’s rural roads, particularly routine maintenance, have significant potential to use local resources, create decent jobs, support the local economy, and strengthen local commerce, and have therefore important implications for poverty reduction and local economic and social development. COMPONENTS  Component 1: Rural roads maintenance subprojects: (i) Sub-component 1.1: Labor-intensive rural roads maintenance works; and (ii) Sub-component 1.2:   Technical inspection of works Component 2: Capacity building: (i) Sub-component 2.1: Trainings on technical aspects; and (ii) Sub-component 2.2: Trainings on entrepreneurial, managerial, and technical aspects Component 3: Project management and administration, monitoring and evaluation, and knowledge dissemination: (i) Sub-component 3.1: Project management and administration; (ii) Sub-component 3.2: Monitoring and evaluation; and (iii) Sub-component 3.3: Outreach and knowledge dissemination FINANCING   I3RF: US$5 million LINKAGES TO The project is related to the ongoing WBG-funded TCP and EODP since all three aim to improve the condition of the existing road infrastructure through OTHER PROJECTS/ reconstruction, rehabilitation, and preventive maintenance, increase access to markets and decrease transport costs (although for different levels of the road INITIATIVES   network).The microenterprises approach is particularly aligned with the Iraq RDF which emphasizes the mobilization of resources and maintenance of restored   facilities through community-based contracting as priority actions in the recovery action plan for the transport sector. The project is also aligned with the Iraq Vision 2030 which defines the elements and the strategic reforms to establish a new social contract for peace and prosperity. LINK TO GOI The project is directly supporting development and strengthening of the Iraqi private sector which has been emphasized in the White Paper through: (i) creating REFORM AGENDA employment opportunities through microenterprises, (ii) creating job opportunities for low-income unemployed workers, (iii) supporting small-sized projects throughout Iraq. TYPE OF SUPPORT Technical Assistance, Advisory Support and Works 105 GENDER EQUALITY This project contributes to the economic empowerment of women and girls and to improving data on gender. At 43 percent, Iraq has one of the lowest labor & WOMEN force participation rates in the world, and in the region, women’s participation is 12 percent. Although there is no data to show this, this figure could be lower for EMPOWERMENT the transport sector. Maintenance activities are planned to be carried out by local community workers and to create job opportunities. The direct beneficiaries of the project will be inhabitants in the project area who benefit from livelihood improvement opportunities in the form of rural roads maintenance sub- projects (around 1,200 individuals both directly employed and indirectly provided with earning opportunity, 20 percent of whom are women, spread across 50 subprojects). Additionally, the project will offer specialized training for women based on analysis on the ground that may relate to self-confidence, financial management, and technical training in areas likely to be dominated by men. The design and implementation plan will pay particular attention to physical challenges that women may face, such as transportation. CLIMATE CHANGE & The project aims to preserve roads through preventive maintenance against climate induced deterioration. In particular: (i) preventing damage from heavy THE ENVIRONMENT precipitation and flooding by maintaining and providing drainage elements (ditches, gutters, culverts), (ii) maintaining slopes and drainage system to prevent landslides, (iii) maintaining road surfaces to prevent damage from water and heat. It also has some contribution to decarbonization by minimizing the use of fossil fuel rum construction machines and depends on labor intensive approaches using hand tools. COVID RESPONSE & The project is aligned with the WBG’s COVID-19 Crisis Response Approach Paper: Pillar 2 - Protecting Poor and Vulnerable People by providing employment, IMPACT and in addition, a simplified guide for environmental and social management has been prepared for the project which emphasizes community health and safety risks due to exposure to communicable diseases, including from COVID-19. IMPLEMENTATION The MOCHMPW in Baghdad will be the implementing entity and will use existing institutional coordination with counterparts and will consult stakeholders ARRANGEMENTS  such as the Ministry of Finance, Ministry of Planning, Ministry of Environment and representatives of civil society as appropriate. The Roads and Bridges   Directorate in Bagdad and General Directorate for Roads and Bridges (GDRB) in Kurdistan will be the project implementing agencies, responsible for day- to-day implementation of the activities including procurement, contract administration and management, technical supervision, monitoring and reporting. The Roads and Bridges Directorate will be responsible for the design, procurement, financial management, and social and environmental safeguards of road network maintenance in all governorates except KRI. The Roads and Bridges Directorate is also responsible for the procurement of all consultancy services required for the project; it is also responsible for submitting financial reports to the WBG for components implemented by it and will have a separate Designated Account . The General Directorate for Roads and Bridges will be responsible for design, procurement, financial management, and social and environmental safeguards of road network maintenance in the KRI. It is responsible for submitting financial reports to the WBG for components implemented by it, and will have a separate Designated Account. KEY DELIVERABLES No results as the project is not effective yet. & RESULTS FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION Delays in signing the grant agreement. CHALLENGES BENEFICIARIES Inhabitants in the project area who benefit from employment opportunities created, resulting in the equivalent of approximately 270,000 workdays; and communities that will benefit from the maintained access to the targeted roads. GEOGRAPHIC Statewide project - governorates Al Quadsya, Najaf, Karbala, Diyala, Salah El Din, Nineveh, Al Muthanna and Dohuk. COVERAGE  106 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project Strengthening Immunization Systems for Equitable and Quality Delivery of COVID-19 Vaccination through Third Party Monitoring – RE activity P CODE P177038 GOVERNMENT MoHE COUNTERPART READINESS & The proposal was developed jointly with the MoHE. A technical session was held on August 23, 2021 with the MoP and I3RF donors to discuss the proposal. The GOVERNMENT proposal was approved by MoP and I3RF Secretariat on August 29, 2021. ENGAGEMENT STATUS  Active: Grant agreement signed; the Iraq COVID-19 Vaccination Project became effective on December 16, 2021. PROJECT To support the GoI in the acquisition and deployment of COVID-19 vaccines. DEVELOPMENT OBJECTIVE BRIEF PROJECT The project will support the implementation of the Iraq COVID-19 Vaccination Project (IBRD US$98 million). The grant funding will cover the costs under DESCRIPTION Sub-component 2.2 of the Project for establishing a mechanism for third party monitoring of COVID-19 vaccination (US$2 million). The key objective of the grant financed activity is for the MoHE and WB to receive independent validation of the compliance of the deployment of the WB financed vaccines with the NVDP, WHO standards and WB requirements reflected in the legal agreements, Environmental and Social Management Framework and the Project Operation Manual, at (i) the key points in the supply chain and (ii) vaccination sites from the technical, environmental and social safeguards perspectives. The findings will be shared periodically with the MoHE and the WB. The work of the TPMA will therefore contribute to ensuring safe, effective, efficient, and equitable vaccine rollout and maximizing its population benefits. This will also contribute to the GoI’s efforts to increase the demand for and build trust in COVID-19 vaccination among the population TIMEFRAME  October 2021–June 2023 SECTOR CONTEXT  Iraq is one of the most significantly impacted countries by COVID-19 in the MENA region. Iraq remains susceptible to a high risk of morbidity and mortality due   to COVID-19, not only through its direct effects but also through the indirect effects on the burden to be imposed on the health system. This risk is attributable to a high and growing burden of Non-Communicable Diseases, a diverse range of vulnerable and at-risk populations due to poverty, inequality and displacement, as well as a weak health system with low and inequitable levels of financing, fragmented and inflexible service delivery, limited human and physical resources, and weak surveillance and health information systems. Improved access to vaccination is needed to limit the spread of the disease and lessen the burden on the already weak health system. COVID-19 vaccination, along with improved diagnostics and therapeutics, is essential to protect lives and enable the country to reopen safely. The global economy will not recover fully until people feel they can live, socialize, work, and travel with confidence. Given the importance of limiting the spread of COVID-19 for both health and economic recovery, providing access to COVID-19 vaccines will be critical to accelerate economic and social recovery. The project activities will build on the ongoing World Bank’s COVID-19 response and health sector support, as well as the support of other development partners. 107 COMPONENTS  The I3RF covers the costs under Sub-component 2.2 of the Project for establishing a mechanism for third party monitoring of COVID-19 vaccination (US$2   million). Component 1: COVID-19 Vaccines and Deployment (US$97 million IBRD). The component will support the purchase of COVID-19 vaccines and related deployment activities. Component 2: Project Management and Monitoring and Evaluation (M&E): (i) Sub-component 2.1. Project Management and M&E (US$1 million IBRD); and (ii) Sub-component 2.2. Third Party Monitoring (US$2 million Trust Fund). A TPMA will be contracted by the MoHE using grant financing from I3RF. The TPMA will be responsible for monitoring compliance of the vaccination efforts with Iraq’s NVDP and WHO standards, as well as World Bank technical, environmental, and social requirements. The ToR has been prepared and approved by the World Bank. The MoHE signed the TPM contract with the International Federation of Red Cross and Red Crescent Societies (IFRC) on December 16, 2021. FINANCING   US$2 million from I3RF; US$98 million from IBRD LINKAGES TO The grant will contribute towards both objectives of the I3RF Trust Fund and cover Pillars 3, 4 and 5 of the RDF (improving access to livelihoods and basic OTHER PROJECTS/ services). The grant from the I3RF is aligned with the ongoing I3RF health technical assistance (TA) which was approved and launched on September 16, 2020. INITIATIVES   LINK TO THE GOI The activity is linked to Axis 4 of the White Paper: Providing the key services and rationalizing and directing social care, giving priority to the poor, and REFORM AGENDA protecting them during and after the reform process. The aim is to meet the urgent needs of the population and provide the necessary protection for the vulnerable groups during the reform process and its remedial measures. In addition, given the importance of COVID-19 vaccination in curtailing the pandemic and returning to normalcy, including resumption of economic activities, the activities supported by this project can also indirectly contribute towards Axis 1: Achieving sustainable financial stability with the aim of slowing down or stopping the financial bleeding and giving a longer opportunity to achieve the other structural reforms. TYPE OF SUPPORT The grant financing is aligned with the IBRD US$98 million loan to the GoI to support the acquisition and deployment of COVID-19 vaccines GENDER EQUALITY The project contributes to improving data on gender. Gender inequities and norms influence access to critical health services, as well as risk of exposure to & WOMEN disease, particularly in emergency situations and pandemics. Factors that constrain access to and use of health services by women in Iraq include limited EMPOWERMENT mobility and financial capacity, competing demands of paid and unpaid work, and limited access to information. The reported incidence of COVID-19 is higher among men than women – 59% of registered COVID-19 cases in Iraq to date were among men. This, however, could be a result of men having better access to testing sites or decisions to test only the male member of the household when other members in the household are ill. Moreover, women have also been impacted by the discontinuity of essential services, including for maternal and sexual and reproductive health, and Gender Based Violence. The GBV Information Management System (GBVIMS) has recorded a marked rise in the number of reported incidents of violence in 2020. Prior to the pandemic, the prevalence of GBV was already high – 46 percent of currently married women were exposed to at least one form of spousal violence. COVID-19 vaccine uptake is lower among women in Iraq. The TPMA mechanism proposed for grant funding will monitor the deployment of WB financed vaccines to ensure fair and equitable access. The monitoring mechanism will use checklists, observations, interviews with vaccine recipients and health service providers to identify and report any gender bias in vaccine delivery and administration as well as suggest ways to improve vaccine uptake amongst women. 108 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project CLIMATE CHANGE & The project contributes to climate adaptation and mitigation. As part of the WB financed Iraq COVID-19 Vaccination Project, collaboration is envisioned with THE ENVIRONMENT other WB Global Practices in defining, to the extent possible, sustainable, and high-efficient energy solutions to improve the deployment of vaccines. Technical assistance can be provided to ensure that energy efficiency standards for upgraded cold chain are applied for COVID-19 vaccines and beyond, including through the development of micro-plans to integrate climate-related considerations (e.g. energy efficiency or promotion of hybrid energy source consumption for cold chain). The project will also support the procurement of effective and low-emissions health care waste management equipment that will also contribute to improving the resilience of health care waste management systems to extreme precipitation. The TPMA mechanism will monitor the functionality of the cold chain and the waste management system to verify its compliance with the NVDP, procurement plan, environmental and social management framework, and other key documents. Climate change mitigation co-benefits will be generated under the project through: (i) support for effective health care waste management, including resilience to extreme precipitation and(ii) support for the development of micro-plans that promote the use of high energy efficiency or hybrid energy consumption. COVID RESPONSE & The grant will support the TPMA of deployment of World Bank financed COVID-19 vaccines under the Iraq COVID-19 Vaccination Project. IMPACT IMPLEMENTATION The MoHE is the implementing agency. A PMT has been established and is fully staffed. ARRANGEMENTS  KEY DELIVERABLES The MoHE signed the contract with the TPMA on December 16, 2021, thus fulfilling the of effectiveness of the Iraq COVID-19 Vaccination Project. Work is AND RESULTS currently underway to establish the TPM systems. FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION N/A CHALLENGES BENEFICIARIES The expected project beneficiaries will be Iraq’s population given the nature of the disease. Benefits from COVID-19 vaccination are direct for those included in the priority groups of population that will receive COVID-19 vaccines. As the project will invest in systems strengthening for deployment of the COVID-19 vaccines, other population groups eligible for COVID-19 vaccines will also directly benefit from project investments GEOGRAPHIC National level. COVERAGE  109 COVID-19 Response and Health System Strengthening – BE activity P CODE P174641 GOVERNMENT MoHE COUNTERPART READINESS & The government is fully engaged in implementing the TA activities. GOVERNMENT ENGAGEMENT STATUS  Active PROJECT To strengthen the GoI’s capacity to respond to the COVID-19 pandemic; and to develop innovative models to improve financing, access and quality of healthcare DEVELOPMENT services. OBJECTIVE BRIEF PROJECT This programmatic ASA provides TA and conducts analytical work to inform health policies in two areas: (i) responding to the COVID-19 crisis and (ii) improving DESCRIPTION access to quality health services. It therefore aims to help the GoI address (i) the urgent needs in pandemic response as well as (ii) the medium-and long-term health sector reform priorities. It complements ongoing GoI and development partners’ efforts in both areas. TIMEFRAME  2020–2023 SECTOR CONTEXT  Iraq’s health system is faced with a wide range of challenges, including inequitable financing, underdeveloped health infrastructure and human resources for   health, limited capacity of institutions, low quality of care and fragmented health sector governance. In response, the 2018–2022 Iraq National Vaccination Development Plan set the objective to build a fair and accountable health system through: (i) ensuring a health benefits package for the poor; (ii) reducing regional, income and gender discrepancies in access to health care; (iii) incentivizing primary care; (iv) addressing the financing and capacity constraints of the public hospital sector; and (v) addressing the rising burden of Non-Communicable Diseases, gender based violence (GBV), mental health problems, and re-emerging communicable diseases. COVID-19 has worsened the health system challenges of Iraq remains susceptible to a high risk of morbidity and mortality due to COVID-19, despite national response efforts. The pandemic’s impacts stem directly from the burden of disease and indirectly from health service disruptions and economic losses. Together, they may lead to deteriorating population health outcomes and significant losses in human capital. Despite national response and vaccination efforts, the risk of subsequent COVID-19 waves remain, especially with the emergence of new SARS-COV-2 variants. 110 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project COMPONENTS  1. COVID-19 Emergency Response: The World Bank team organizes this ASA component by the three key themes of COVID-19 response: “Prevent”, “Detect” and   “Respond”. i) “Prevent”: Supporting development of an effective communication and behavior change strategy: This includes research and analytics through social media surveys on vaccine hesitancy and A/B testing to identify more effective messages for the communication campaign, and the development of a National Communication Strategy and Action Plan for COVID-19 vaccination, to be followed by selected technical assistance for its implementation. ii) “Detect”: Strengthening the public health response for disease detection: This includes supporting (a) an assessment of COVID-19 surveillance with recommendations for improvement; (b) an assessment of SARS-CoV-2 testing with recommendations for revision of the testing guidelines and; (c) an online platform for contact tracing and surveillance. iii) “Respond”: Building capacity for safe and effective COVID-19 case management: This includes supporting (a) an assessment patient flow in Iraq health facilities in the context of the pandemic and recommendations for improvement; (b) the assessment of infection prevention and control (IPC) in health facilities and recommendations for improvement and; iv) Other “just-in-time” Technical Assistance activities 2. Improve Access to Quality Healthcare Services: i) Support the development of a medium- to long-term health care services master plan: This includes supporting, as appropriate, the development of a health care services master plan, which includes a road map/action plan to operationalize the national health strategy. It will follow a standard process, including situation analysis, strategic agenda formulation, and development of an operational roadmap aligned with Iraq’s health sector priorities. ii) Supporting the design and implementation of the Social Health Insurance (SHI) reforms: Proposed activities include TA for: (a) an operational roadmap for the implementation of SHI; (b) the development of the SHI benefits package (including primary health care services), considering the implementation capacity of the health system, cost-effectiveness of interventions, burden of disease, fiscal constraints, and GoI’s goals to improve health outcomes and financial protection; (c) costing of the SHI benefits package (including primary care services) and development of a pricing methodology. iii) Support the strengthening of primary healthcare service delivery: Activities in this category will be centered around strengthening primary health care services to increase access to quality health care. Proposed activities include: a Service Delivery Indicators survey to provide a comprehensive assessment of the country’s primary health care facilities, including infrastructure, available inputs, and quality of care. iv) Capacity building and knowledge exchange activities. A series of capacity building and knowledge exchange activities will be organized to support the GoI in the design and implementation of health reforms. This will include a series of webinars with government representatives and technical experts from other countries implementing similar reforms (e.g. Egypt, Indonesia, India, Ukraine). Potential topics include payment reforms (e.g. introduction of capitation payment for primary care), defining the benefits packages, and beneficiary enrollment. In addition, a tailored World Bank Flagship Course on Health Systems Reforms will be designed for Iraq, focusing on key topics of interest and drawing on relevant global experience. Depending on its timing, the course could be virtual, in-person, or a combination of both. FINANCING   I3RF: US$5 million LINKAGES TO The ASA builds on and complements the health activities of the ongoing Bank-financed EODP which focuses on structural improvements for Iraq’s health OTHER PROJECTS/ facilities. With regard to COVID-19, the proposed activities complement ongoing support from other development partners including: the UN-consolidated INITIATIVES   plan and WHO ECHO proposal (aimed to enhance national capacities to prepare and respond to COVID-19 challenges); the UN Post-COVID-19 Recovery   Strategy for Iraq (aimed at strengthening Iraq’s ability to respond to and reduce the impact of COVID-19); and the WHO Health Emergency Plan (aimed at strengthening Iraq’s ability to respond to all health emergencies and comply with International Health Regulations). LINK TO GOI The activity is linked to Axis 4 of the White Paper: Providing the key services and rationalizing and directing social care, giving priority to the poor, and protecting REFORM AGENDA them during and after the reform process. The aim is to meet the urgent needs of the population and provide the necessary protection for the vulnerable groups during the reform process and its remedial measures. TYPE OF SUPPORT Technical Assistance, Advisory Support, and Analytics 111 GENDER EQUALITY The project contributes to improving laws and policies affecting women. The approach to gender issues under this ASA is as follows: (i) All health policies, & WOMEN strategies, action plans, technical guidelines, etc. to be developed with TA from this ASA will apply the gender filter to make sure the needs of Iraq’s women and EMPOWERMENT girls are adequately addressed; (ii) Any M&E framework developed with the support of the ASA will have gender disaggregated indicators and targets where applicable; (iii) All analytical work will have disaggregated analysis where applicable; (iv) The development and costing of a primary healthcare package of services will prioritize reproductive health, maternal and child health, mental health, psychosocial support, and gender-based violence interventions; (v) The assessment and redesign of patient flow at health facilities under Component 1 will help reduce disruptions caused by COVID-19 to essential services such as maternal and reproductive health; (vi) and for all capacity building activities supported by the ASA, gender balance will be ensured among participants. CLIMATE CHANGE & N/A THE ENVIRONMENT COVID RESPONSE & Component 1 (COVID-19 Emergency Response) aims to strengthen the ability of the GoI to respond to the ongoing COVID-19 crisis by enhancing the capacity to IMPACT prevent further transmission, detect cases at early stages, and provide clinical care for those in need. The support under this component would also increase the resilience of the health sector for any future potential pandemics. IMPLEMENTATION The project is managed by the HNP GP, in close collaboration with MoHE in Iraq. Regular bi-weekly meetings are held with the MoHE to discuss progress. ARRANGEMENTS  112 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES The ASA was approved and launched on September 16, 2020. Significant progress has been made with Component 1, which is an urgent priority given the & RESULTS unfolding pandemic, while Component 2 is now underway (initially delayed due to the focus on COVID-19 response). FROM JANUARY TO DECEMBER 2021 1. Progress under Component 1 (COVID-19 Emergency Response) 1.1 “Prevent”: Supporting development of an effective communication and behavior change strategy: The focus of this activity is to assist the MOHE in its COVID-19 vaccine-related communication with both the public and the health workforce. With I3RF support, a Communication Action Plan for COVID-19 vaccination was developed and delivered to the MoHE. The World Bank has also completed (i) the first round of a Facebook survey to explore attitudes related to COVID-19 vaccination in Iraq, and (ii) an experimental online A/B testing to identify effective messages for communication campaign to increase vaccine acceptance. Results of the survey and the A/B testing have been shared with the government and other stakeholders. 1.2 “Detect”: Strengthening the public health response for COVID-19 case detection: This activity supports the GoI to strengthen COVID-19 case detection. Four reports were produced: (i) an assessment of Iraq’s COVID-19 surveillance systems; (ii) an assessment of COVID-19 testing in Iraq; (iii) a guidance document on COVID-19 testing strategies and algorithms; and (iv) an assessment of contact tracing in Iraq . Since delivery of these reports, 4 workshops on the use of different digital platforms for contact tracing (DHIS2, ComCare, OpenSRP, GO.DATA) have been conducted for MoHE. Two workshops on COVID-19 testing were also conducted for frontline laboratory technicians. Additional workshops on COVID-19 surveillance and testing are under development. 1.3“ Respond”: Building capacity for safe and effective COVID-19 case managementt: This activity focuses primarily on the management of active cases and includes TA to improve patient flow, as well as IPC in health facilities. The WB developed an IPC and patient flow assessment instrument and deployed it in nine Iraq health facilities; the information collected was combined with multisource information gathering, and reports on both IPC and patient flow were finalized and delivered to the MoHE. Dissemination workshops are now being developed. 1.4 Just-in time TA in COVID-19 response: The WB has been providing additional just-in-time technical assistance to support the COVID-19 response, with a focus on vaccination. This included support for: (i) country readiness assessment for COVID-19 vaccination using the integrated VIRAF/VIRAT 2.0 tool (completed); (ii) development of the National Deployment and Vaccination Plan (NDVP) in collaboration with UNICEF and other partners (completed); (iii) provision of technical inputs for the development of a digital client registry for COVID-19 vaccination (completed); (iv) development of a social media listening platform related to vaccination in Iraq using TalkWalker tool (completed); (v) technical review of Iraq’s National Strategy for Adverse Event Following Immunization or AEFI (completed) (vi) a country workshop on oxygen safety in healthcare settings (completed); (vii) engaging Iraq in 10 regional workshops on COVID-19 vaccination organized by the World Bank (completed). Each workshop focused on a strategic aspect of vaccination (cf. section 4.1.7 Reinforcing the Healthcare System in Light of the Pandemic for more details). IMPLEMENTATION The inability to conduct missions and have face-to-face interaction of the counterparts due to COVID-19 is a challenge. The team has been maximizing the use CHALLENGES of teleconferences and information technology. In addition, given the focus on COVID-19 response, it was agreed with MoHE to temporarily put Component 2 activities on hold. Work under Component 2 has resumed; and the GoI has requested substantial TA support for the SHI reforms. BENEFICIARIES The entire population of Iraq, especially women, children, the poor and vulnerable are the primary beneficiaries. Furthermore, the GoI, particularly MOEH, will benefit from increased capacity to formulate and undertake evidence-based health reforms. GEOGRAPHIC National level. COVERAGE  113 PILLAR 2: ECONOMIC DIVERSIFICATION AND PRIVATE SECTOR-LED GROWTH 2.1 ECONOMIC DIVERSIFICATION AND TRANSFORMATION Iraq Economic Diversification and Growth ASAs (includes the Reform Matrix and White Paper) – BE activity P CODE P176098 GOVERNMENT MoP, MoF, RMC at the PM Office COUNTERPART READINESS & The project was prepared in collaboration with Ministries of Planning, Finance, Trade and the Reform Management. Several meetings and written exchanges GOVERNMENT have contributed to the design of the components. Moreover, the project benefitted from several rounds of discussion with donor partners including those ENGAGEMENT contributing to the I3RF (Canada, Germany, Sweden and UK) and other partners including the European Union and GIZ. STATUS  Active PROJECT To provide the GoI with analytical underpinnings and policy options for implementing reform priorities under the GoI White Paper to diversify the economy and DEVELOPMENT put in place enablers for private sector led growth and job creation. OBJECTIVE BRIEF PROJECT The project provides policy options and implement reforms focusing on diversification, private-led growth and job creation. They focus specifically on three DESCRIPTION areas 1) on-demand policy support for the High Reform Council and the RMC for GoI White Paper implementation; 2) policy support in the areas of macro- economic sustainability and growth; and 3) policy dialogue on modernizing Iraq’s trade and foreign investment policies. These activities are expected to be delivered in the form of analytical, advisory, technical assistance and capacity building. The main stakeholders will be the High Reform Council, the Reform Management Cell, the Prime Minister’s Office, central ministries (especially MoF), MoP, and relevant sectoral ministries like the Ministry of Trade. These activities will provide an opportunity to take forward previous analytical underpinnings on Iraq development model forward into implementation phase as well as deepening understanding in areas in which strategic analysis has not been concluded. TIMEFRAME  January 2023 114 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project SECTOR CONTEXT  Iraq is the world’s fourth largest oil exporter and holds the world’s fifth largest proven reserves of petroleum. This accounts for over 65 percent of GDP, 92   percent of central government revenue, and 95 percent of the country’s exports. The weak economic and social returns of Iraq’s development model of the past two decades have put the country behind its peer upper middle-income countries in virtually all key socio-economic indicators and has triggered the need to rethink growth away from the oil sector and its dominance of the public sector in economic activity. This places diversification and private sector participation at the core of the new post-conflict growth paradigm. There are two important conditions to ensure the success of this approach: first, the development of strong public institutions capable of improving economic management, and second, the development of enabling conditions for private sector growth and efficacy. As such, economic diversification and transformation features strongly in the WB existing operational portfolio, its policy dialogue, and the current pipeline of analytical underpinnings. This pillar was strengthened by a Memorandum of Understanding (MOU) signed between the World Bank Group and the Government of Iraq in October 2019 to tackle those issues. The MOU later developed into an Iraqi led national reform plan (the White Paper), which benefitted from WB analytical inputs financed by the I3RF. The White Paper focuses on five thematic reform areas: i) achieve a sustainable fiscal framework; ii) macroeconomic reforms and productive sectors support for sustainable job creation; iii) essential infrastructure to support growth; iv) provide basic services and consolidate social protection systems; v) develop the governance, legal, and administrative environment to help institutions and individuals to implement reform. Many of these areas will require further deep dives to formulate concrete action plans and capacity building to implement reforms, and the proposed analytical and advisory (ASA) program addresses this need. COMPONENTS  Component 1: On-demand policy support for the High Reform Council and Reform Management Cell for GoI White Paper implementation.   Component 2: Policy support in the areas of macro-economic sustainability and growth. Component 3: Policy dialogue on modernizing Iraq’s trade and foreign investment policies. FINANCING   I3RF: US$1.8 million. LINKAGES TO This programmatic project builds on the findings of the previous analytical program on diversification funded by the I3RF, mainly the work that culminated OTHER PROJECTS/ in the publication of the Iraq Country Economic Memorandum (P141781), and which underpinned the GoI White Paper. As such, the proposed activities are a INITIATIVES   continuation of this policy program with a focus on implementation of the White Paper reforms. Implementation which will require direct advisory services,   capacity building and further analytics in areas in which policy dialogue is absent. The propose activities will complement ongoing policy engagements with Iraq; whether it is under I3RF activities like the Financial Sector Reforms and Enabling Environment for Small and Growing Businesses (clusters II.2 and II.3 respectively of the I3RF work plan), and other active policy support through Donors like the GIZ macroeconomic policy support project (notably in the areas of domestic revenue mobilization and economic modeling), GIZ support on customs reforms, and the ITC and UNCTAD work on Trade and WTO accession. LINK TO GOI In February 2021, the GoI formulated a detailed reform matrix and have devised a reform implementation governance framework in which it has created a High REFORM AGENDA Reform Committee (HRC) for decision making, along with an executive body, the RMC, that will coordinate reform actions with line ministries. The activities proposed in this ASA program will deliver the necessary technical underpinnings and capacity building for the implementation and operationalization of reforms from the WP’s reform matrix. While HRC and RMC structures are still being populated with experts and staff, the program will start working on priority reform initiatives currently being led by line ministries as a first step, and will gradually deepen those reforms working closely with the RMC. TYPE OF SUPPORT Technical Assistance, Advisory Support, Analytics and other types of support (embedded experts and purchase of software) GENDER EQUALITY The project contributes to improving laws and policies affecting women. The program provides advisory services and capacity building for White Paper & WOMEN reforms, allowing it to introduce gender specific issues into policy planning and implementation linked to the program’s 3 components. As such, gender will EMPOWERMENT be treated as a cross-cutting issue and given special attention, for example, when looking at issues linked to competition and competitiveness, the work will examine impediments to women access to economic opportunities and advise on policies to mitigate this. 115 CLIMATE CHANGE & Climate change will also be considered a cross-cutting issue in the components of this ASA. More prominently, it will figure in the support provided to MoP THE ENVIRONMENT for capacity building on modeling and green growth policies as they prepare their national development plan. The objective is to integrate climate change mitigation and adaptation policies within this plan. COVID RESPONSE & N/A IMPACT IMPLEMENTATION The project is a multi-disciplinary, multi-sectoral program involving several Global Practices (GPs), and a Bank-executed program coordinated by the MTIGP. ARRANGEMENTS  MoP, MoF, Ministry of Trade and the RMC are the main government counterparts. KEY DELIVERABLES The main deliverables within the suggested period are: (i) The creation of a Dashboard for reforms coordination; (ii) The provision of training workshops on & RESULTS M&E; and (iii) The provision of a tariff reform advisory. FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION Project implementation has just started without any major challenges. Governmental changes may impact implementation the team is however working CHALLENGES closely with line ministries to mitigate any possible risks. BENEFICIARIES MoP, MoF, Ministry of Trade and the RMC at the Prime Minister’s Office. GEOGRAPHIC National level. COVERAGE 2.2 FINANCIAL SECTOR REFORMS Iraq Financial Sector – BE activity P CODE P171615 GOVERNMENT Central Bank of Iraq, Economic Reform Unit (ERU) at the Prime Minister’s Office, RMC, Financial Intelligence Unit (FIU), MoP, MOLSA and MoCHPMW, in COUNTERPART coordination with MoF. The task team is expecting to liaise further with the National Housing Fund on potential products and pilot activities. READINESS & The work plan was developed in close collaboration with the CBI with inputs from MoF and the entities listed above. The team is working with a dedicated GOVERNMENT team at CBI comprising the GMs of Banking Supervision, Payment, Infrastructure and the Advisor Governor Office. GoI counterparts were kept updated through ENGAGEMENT regular briefings and presentations. Presentations were made to the Minister of Finance, Central Bank Governor, Minister of Planning, Head of RMC and to other financial sector stakeholders including the Iraqi League of Private Banks, Payment System Providers and the Iraqi British Business Association among others. The team has also kept I3RF donors updated through the IECG and bilaterally (EU/KfW/GIZ/IOM) to ensure work plans are aligned. STATUS Active 116 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project PROJECT To improve the stability and integrity of the financial system and access to finance through reforms and capacity building to enhance financial infrastructure, DEVELOPMENT strengthen regulatory and supervisory frameworks and improve the efficiency and impact of public interventions and state-owned financial institutions. OBJECTIVE BRIEF PROJECT The project consists of two broad pillars: “Strengthening the Foundation for Financial Sector Development” and “Developing Specialized Finance”. The first DESCRIPTION pillar entails three components related to reforms of state-owned banks and the strengthening of banking sector licensing, regulation and supervision; National payments system strengthening; and National ML/TF risk assessment. The second pillar aims to contribute to the development of specialized finance with a specific focus on microfinance and housing finance. TIMEFRAME  Q1 2020–Q4 2023 SECTOR CONTEXT  The banking system continues to be dominated by under-capitalized and under-provisioned state-owned banks. The overarching role of the state in the   banking sector and its use of directed lending schemes have resulted in large public-sector arrears on state-owned bank balance sheets, which, coupled with understated non-performing loans have led to impaired capitalization. The non-bank financial sector is at an early stage of development, with nascent capital markets and absence of customary non-bank financial institutions such as leasing companies. Access to finance remains low as the microfinance sector is held back by regulatory deficiencies and funding constraints. Lack of regulatory infrastructure for secure transactions, credit reporting, and insolvency increase informational asymmetry and lending risks for banks. Current housing finance mechanisms rely almost exclusively on highly subsidized lending by state-owned institutions, are costly and cannot meet the scale needed to cope with the growing housing deficits, while crowding out potential private sector solutions. Progress was made in 2021, spearheaded by the CBI in proceeding towards implementing a number of key reforms as recommended by the WB team, including new corporate governance bylaws for Rasheed and Rafidain (R&R); a dedicated SOB unit has been established at CBI and the MoF has agreed to the conduct of an Asset Quality Review (AQR) of the two largest banks. It is critical that these reforms are fully implemented to ensure momentum is maintained towards the expeditious reform of the SOB enabling them to play their expected role in the economy. COMPONENTS  Pillar 1: Strengthening the Foundation for Financial Sector Development: (i) Support the implementation of recommendations of the Financial Sector   Assessment Program Development Module (FSAP DM), expected to be focused on the reform strategy for state-owned banks and the strengthening of banking sector licensing, regulation and supervision; (ii) National Payments System Strengthening project; and (iii) National Money Laundering/Terrorist Financing Risk Assessment. Pillar 2: Developing Specialized Finance: (i) Microfinance Sector Development; and (ii) Housing Finance Advisory. FINANCING   I3RF: US$2.4 million LINKAGES TO The activities are aligned and provide operational support and Technical Assistance to ongoing WB projects including SFD, COVID-19 Adaptation and Recovery OTHER PROJECTS/ Pilot (CARP) supporting the activities under sub-component 1. INITIATIVES   LINK TO GOI Financial Regulatory Reform, Banking Performance, Electronic Banking Services and Government Banks REFORM AGENDA TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics 117 GENDER EQUALITY The project contributes to economic empowerment of women and girls, and improving laws and policies affecting women. Only 13 percent of women work in & WOMEN Iraq, according to ILO data, which places Iraq among the countries with the lowest female participation rates in the world. The GoI has targeted increases in EMPOWERMENT women’s labor force participation rates by 2025 of 5 percentage points. If these targets are met and maintained for a decade, annual economic growth would be increased by 1.6 percent in Iraq by 2035. Regarding entrepreneurship, 90 percent of MSMEs are informal but it’s unclear what percent of these MSMEs are women-owned. The related work being carried out on liquidity support for the microfinance sector and on development of a NFIS is an opportunity to improve finance available to women-owned businesses, and financial inclusion for women, and is intended to improve women’s control of assets. CLIMATE CHANGE & The project takes climate considerations in its implementation. Given the current state and limited credit intermediation capacity of the Iraqi financial sector THE ENVIRONMENT and nascent capital markets, financing/funding of climate adaptation and mitigation will have to be developed through innovative “Green” financing solutions including a Green Bonds Framework. Financing is a cross cutting solution and a comprehensive assessment of climate impacts on Iraq’s financial sector is to be conducted (sectoral assessments; lending capacity; climate stress-testing, etc). The financial sector will need to play a leading role in scaling up green initiatives, de-risking projects for investors, and optimizing funding costs. COVID RESPONSE & The team has developed an IPF Pilot Operation Supporting Firms Resilience, Access to Finance and Growth in Iraq (CARP) which has been approved and is now IMPACT in the process of achieving effectiveness. The project will support the strengthening of MSME finance in Iraq, with a particular focus on providing liquidity support and technical assistance to microfinance institutions (MFIs) affected by the COVID-19 crisis and strengthening the legal and regulatory framework governing MSME finance in Iraq by assisting the CBI to establish a NBFI unit. IMPLEMENTATION The grant is being managed on the WB side by the FCI GP, in collaboration with other relevant GPs, including SPJ; for GoI side the primary counterparts are CBI ARRANGEMENTS  in collaboration with line ministries as noted under governmental counterparts above. 118 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES The below is pursuant to the technical assistance which included inputs on banking sector reforms to the White Paper, recommendations on Corporate & RESULTS Governance Reforms in State Owned Banks, recommendations and a detailed roadmap on Reform and Restructuring of SOBs, strengthening of the National FROM JANUARY TO Payments ecosystem and advisory support on Financial Integrity through the National Risk Assessment on AML/CFT. The continuing dependence of a majority DECEMBER 2021 of Private Banks on a single revenue source (FX arbitrage) is a cause for concern and a potential financial stability risk as these banks lack the capital to invest in systems, operations and human capital to offer a broad range of products and services. CBI is aware of these risks and is considering appropriate prudential measures to mitigate them. Pillar I: Strengthening the Foundation for Financial Sector Development: 1. Support the implementation of recommendations of the FSAP DM, expected to be focused on the reform strategy for state-owned banks and the strengthening of banking sector licensing, regulation and supervision. Key Deliverables: To be defined post-FSAP DM issuance. Results: (i) The team maintained dialogue with CBI, MoF, and the Higher Committee for State Bank Reform as a follow up to the recommendations presented in its State-Owned Bank Reform and Restructuring Roadmap for the two largest Banks (Rasheed and Rafidian) and its Technical Note on the Corporate Governance Reforms of State-Owned Banks; (ii) Progress has been made in 2021 spearheaded by the CBI in proceeding towards implementing a number of key reforms as recommended by the WB including drafting of new corporate governance bylaws for Rasheed and Rafidain (R&R); a dedicated SOB unit has been established at CBI and the MoF has agreed to the conduct of an Asset Quality Review (AQR) of the two largest banks; (iii) The team conducted virtual meetings with key stakeholders involved in the restructuring of state-owned financial institutions. At the request of CBI and MoF, the WB developed and presented to the national authorities a ToR for an independent Assets Quality Review of the two largest state-owned financial institutions. 2. National Payments System Strengthening project. Key Deliverables: (i) A series of workshops/policy dialogues; (ii) Increased capacity of CBI to implement its oversight mandate over NPS; (iii) Increased capacity of CBI in fostering development of Fintech in Iraq; (iv) TA support for 3 rounds of Business Continuity Plan testing and addressing gaps identified by these BCP tests; (v) TA to identify investment needs and to be complemented by public and private investments on the part of the GoI and banking sector. This TA would provide recommendations on the investments needed to realize the reforms. Results: (i) Delivered two workshops and the draft implementation plan for digital onboarding and electronic Know-Your-Customer (e-KYC) in 2020, further work is pending the approval of the cabinet’s e-Government Committee. (ii) In 2021 , the team has produced the following analytical work: (1) a set of case studies on the regulation and oversight of e-money providers (presented at a meeting with the CBI senior advisor on July 12, 2021), (2) mapping of risks affecting the national payment system, as inputs to the revised business continuity plan (to be shared and presented in December 2021), (3) guidance on relaunching the National Payments Council (to be shared and presented in October 2021), (4) methodology to assess the international remittance ecosystem according to international standards (to be presented in November 2021), and (5) proposals to modernize the CBI payment system oversight framework (to be presented in December 2021). In addition, in preparation for a further four workshops scheduled for November–December 2021, the World Bank team has prepared introductory presentations highlighting the most important areas for discussion and outlining the work plan for 2021–2023. 2. Housing Finance Advisory. Key Deliverables: (i) Diagnostic report on housing finance market and legal and regulatory framework; and (ii) Design of products/ pilots for affordable mortgage, microfinance, and subsidy schemes based on the diagnostic. Results: (i) The team is in the final stages of drafting a policy note to support the GoI to: (1) develop sustainable housing finance solutions in the medium- to long-term that address the diverse needs of the population segment who do not have access to adequate housing, and (2) share experiences from other countries on housing finance solutions in the context of reconstruction and developing sustainable long term financing solutions. This note is expected to be issued by the end of November 2021. The note will be a starting point for discussions with counterparts about structural reforms in the housing finance sector, and institutional reform in organizations such as the Real Estate Bank of Iraq or the Housing Fund; (ii) The team prepared a specific background paper on housing finance under the FSAP DM which made use of ongoing work and analysis funded under this activity; and (ii) The team plans to disseminate the recommendations of the Technical Note through a series of virtual/onsite events. 119 3. National ML/TF Risk Assessment. Key Deliverables: (i) Delivery of pre-NRA Orientation Seminar; (ii) Delivery of 3-day NRA Training Workshop; (iii) Delivery of 1–2 interim advisory support missions; (iv) Conducting review and providing written inputs on eight draft NRA Chapter Reports; (v) Conducting review and providing written inputs on draft (full/compiled) NRA Draft Report; (vi) Conducting review and providing inputs on draft NRA Action Plan; and (vii) Delivery of final (3-day) NRA Workshop. Results: (i) 2020: The team delivered initial NRA Training programs to eight NRA Working Groups of Iraqi officials in 2020 (suspension of mission travel due to deterioration of security conditions and onset of COVID-19 led to cancellation of in person pre-NRA orientation workshop and the 3-day training workshops); (ii) 2021: The WBG delivered series of eight refresher NRA Training Programs to the eight NRA Working Groups: (1) ML Threats; (2) National ML Vulnerabilities; (3) Banking Sector; (4) Insurance Sector; (5) Securities/Cap Mkts Sector; (6) Other Financial Institutions Sectors; (7) Designated Non-Financial Businesses/Professions (DNFBPs); and (8) TF Risks; (iii) The team reviewed and provided comments to the FIU in preparation of its responses to the EU assessment; (iv) The team is in continuous engagement with the FIU team/NRA WG who are in process of collecting and analyzing data/ info from various sectors to complete the respective ML and TF threat and vulnerability analysis; (v) WBG outputs: delivery of training and mentoring programs by VC; and (vi) Iraqi officials: working to produce NRA Chapter Reports summarizing ML or TF threats or vulnerabilities (respectively) relating to each sector. Data collection continues to pose significant challenges to the NRA WG as they work to complete their respective reports. Pillar II: Developing Specialized Finance: 1. Microfinance Sector Development. Key Deliverables: (i) Delivery of a microfinance pilot under ESSPR; (ii) Design and implementation of a sustainable microfinance program at MOLSA; (iii) Institutional and program upgrading at MOLSA; (iv) Operationalization of SFD in line with international best practices with regards to apex institution; (v) A comprehensive economic survey of targeted regions to highlight regional advantages in defining jobs and projects; (vi) A feasibility study to establish a “one-stop shop” for provision of nonfinancial services in SFD; (vii) A number of training programs to build SFD team capacity on micro-lending and SMEs; (viii) Criteria and processes to identify and select MFIs are developed; (ix) A Monitoring and Evaluation (M&E) system developed at SFD; and (x) Microfinance regulations developed. Results: (i) The Team provided extensive TA (Feasibility study, New Products, Process flows, TORs, Ops Manuals, Capacity building etc) to MOLSA to establish a pilot microfinance unit as part of the ESSRP. Unfortunately, the project has been suspended since January 2021 and is now cancelled; (ii) The Team provided extensive TA (OPS Manual, Process Flows, TORs for key staff, Capacity Building, KPIs, Policies and Procedures, etc.) to the MoP to set up a microfinance unit under the Social Fund for Development (SFD). Unfortunately, the project has been delayed as the SFD Law is yet to be approved in Parliament and its approval in the near term appears unlikely and the planned activities in support of the establishment of MF unit are unlikely to proceed; (ii) The MoP informed the WB of the intention to drop Component 2 (TA to set up the SFD MF unit) entirely and reallocate its funds to Component 1. The motivation to drop Component 2 is, in the view of Government, premised on feedback from the State Council, that the policy lead functions for microfinance are beyond the purview of the MoP’s mandate. Thus, to establish an autonomous institution as envisaged at the start of the project is unfeasible, and the ministry incapable of making substantive progress in implementation of the component; (iv) The WB team participated in a Virtual Mission and in mission meetings including with the Assistant MoP, and prepared a detailed note on the salient features of Component 2; (v) In view of the aforementioned and in response to the impact of the COVID-19 pandemic on the MSME sector, the team shifted the activity of supporting the development of the regulatory framework for MSME and has incorporated this activity as part of the COVID-19 Adaptation and Recovery Pilot: Supporting Firms’ Resilience, Access to Finance and Growth in Iraq. This is proposed to be achieved by providing TA to the CBI to establish a Non-Banking Financial Institutions (NBFI) Unit and support to draft a Law/Regulation on NBFIs to assist these firms (including MFI) to access finance and improve financial inclusion. IMPLEMENTATION Limited activities due to the continuing impact of COVID-19; Suspension/cancellation of EODP/ESSRP Lending Operation; Ongoing discussions with MoP on CHALLENGES the status of SFD under Component 2. These developments have resulted in the curtailment/cancellation of TA support to the EODP/ESSRP and the potential curtailment of the SFD MF operations under Component 2 which has necessitated a reallocation of resources from the Microfinance Sector Development. Additional challenges were related to discussions with counterparts (CBI) to further refine the project scope, resulting in a revised work plan; difficulties with data collection by counterparts (FIU) leading to delays in completion of progress reports. The continuing suspension of mission travel has led to cancellation of face to face meetings and workshops which resulted in lower disbursements. BENEFICIARIES Direct beneficiaries: Government counterparts; Indirect beneficiaries: Iraq’s population at large. GEOGRAPHIC National level. COVERAGE  120 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project Analytics and Advisory for Management of Public Resources and Fiscal Federalism – BE activity P CODE P166640 GOVERNMENT MoF COUNTERPART READINESS & The team is engaging actively with the RMC in the Prime Minister’s office, the Debt Management Department in MoF and the private office of the Minister of GOVERNMENT Finance to initiate and provide TA. It is also actively engaging with the newly established Federal Civil Service Commission. ENGAGEMENT STATUS  Active PROJECT Strengthening fiscal sustainability and transparency and improving intergovernmental fiscal relations in Iraq. DEVELOPMENT OBJECTIVE   BRIEF PROJECT Planned activities will complement ongoing WB projects and help prepare further WB engagement on PFM reforms. They will consist of five main streams of DESCRIPTION activities: 1) fiscal crisis management; 2) fiscal federalism; 3) debt management; 4) revenue mobilization; and 5) fiscal transparency. TIMEFRAME  October 2020–December 2023 SECTOR CONTEXT  The newly-appointed GoI is confronted with a dire fiscal crisis as a result of the steep drop in oil prices. Under the current fiscal crisis, it needs to implement   structural economic governance reforms while addressing urgent fiscal constraints (a shrinking fiscal space, bloated recurrent expenditure, fast-growing financing needs). The shrinking of oil revenues to less than the wage and pension bill (which amounted to half of expenditure at federal level in 2019) has jeopardized further fiscal sustainability in the medium term. Adequate response to the crisis calls for strengthened fiscal crisis management capacity and the new government has established an Economic Crisis Committee (ECC) to be headed by the Prime Minister or the Minister of Finance on deputation, and which is attended by the ministers of Finance, Planning and Foreign Affairs, the Secretary General of the Council of Minister’s Secretariat (COMSEC), the Governor of the Central Bank, the Head of COMSEC Legal Department and the Prime Minister’s advisers. The ECC will focus on five main issues: (1) Accounting reforms and State Liquidity Management; (2) Increasing State Revenues; (3) Economic revitalization; (4) Financial and Banking Reforms; (5) International Financial relationships. COMPONENTS  Component 1: Technical Assistance   Component 2: Analytical Work (Political Economy Analysis; Institutional Assessments) Main planned activities: (i) Capacity building for fiscal crisis management; (ii) Support to the reform of fiscal federalism; (iii) Strengthening of debt management; (iv) Revenue mobilization; and (v) Fiscal transparency. FINANCING   I3RF: US$2 million. Co-financing by other TFs is explored. 121 LINKAGES TO The activity will support and complement two on-going WB implemented projects, a WB-funded project on the modernization of PFM systems (US$41.5 million); OTHER PROJECTS/ and an EU-funded project on Public Financial Management (PFM) oversight and accountability institutions (US$12.5 million). It will in particular synergize with INITIATIVES   the EU-funded project (P170704) managed by the WB on Strengthening PFM oversight and accountability institutions which aims at strengthening institutions   and mechanisms of fiscal accountability and oversight at federal and regional levels (and which covers: wage bill management, budget transparency, financial oversight over state-owned enterprises, e-procurement, etc.), including by preparing its Phase 2 which will focus on tax and customs administration and fiscal federalism. It will contribute to WB overall support and Government request for its assistance as formalized in the MoU signed between the GoI and the WBG in October 2019 to cooperate and further their engagement on economic governance reforms and fiscal sustainability. LINK TO GOI The activities relate directly to the implementation of the White paper as it concerns debt management, revenue mobilization, fiscal federalism and civil REFORM AGENDA service reform. TYPE OF SUPPORT Technical Assistance, Advisory Support, Analytics and Learning Event on Political Economy Analysis GENDER EQUALITY The project contributes to improving laws and policies affecting women. The activities may support gender-based budgeting which is required by the 2019 & WOMEN PFM law. It should also lead to incorporation of the gender equity agenda into civil service reforms. The project will complement the two WB PFM projects on EMPOWERMENT citizen engagement and gender equality by promoting social demand for public participation in budget processes and policy dialogue on gender budgeting (a provision of the recently enacted PFM law). By promoting revenue mobilization and fiscal equalization, the project should also help the government mitigate spatial inequalities and finance anti-poverty interventions. CLIMATE CHANGE & N/A THE ENVIRONMENT COVID RESPONSE & The COVID-19 crisis prevents direct interaction with Iraqi stakeholders, including in neighboring countries. Accordingly, all activities will be conducted remotely IMPACT in partnership with local think tanks. IMPLEMENTATION At the World Bank, the activity is co-led by the Governance GP and MTI. ARRANGEMENTS  KEY DELIVERABLES The project has already improved public debt reporting and the following activities are ongoing: (i) Digital Government Readiness Assessment (DGRA): & RESULTS Consultant hired and starting assessment in October 2021; (ii) Technical Assistance on Debt Management: assisting the public debt department to use DMFAS FROM JANUARY TO software for registration and management of the public debt of the GoI; (iii) Technical Assistance on Tax Administration: policy dialogue on planning for DECEMBER 2021 an Integrated Tax Administration System (ITAS); (iv) Technical Assistance to monitor implementation of the White paper on economic reforms: workshop on monitoring framework and tools (dashboard); and (v) Technical Assistance to the Federal Civil Service Commission: exchange of experience with sister institutions; preparation of assistance to draft secondary legislation on civil service. Key analytical deliverables in 2021 include: (i) the Public debt management guidance note, (ii)Tax administration reform policy note, (iii)The oil revenue management policy note and (iv) The policy note on recruitment practices IMPLEMENTATION Changes in government may impact implementation. CHALLENGES BENEFICIARIES The activity will inform federal-level policies and benefit central and decentralized fiscal institutions with respect to revenue mobilization and fiscal transfers. GEOGRAPHIC National level. COVERAGE  122 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project 2.3 ENABLING ENVIRONMENT FOR SMALL AND GROWING BUSINESSES COVID-19 Adaptation and Recovery Pilot for MSMEs in Iraq (CARP) – RE activity P CODE P174273 GOVERNMENT MoF, CBI COUNTERPART READINESS & The project has been endorsed by the I3RF Steering Committee and approved by the WBG Regional Vice President on June 25th, 2021. The project Grant GOVERNMENT Agreement was signed by MoF on October 1, 2021, and the project team is working with the MoF to obtain a legal opinion from the legal department at the ENGAGEMENT Council of Ministers in order for the project to be declared effective. The project team is expeditiously finalizing preparations with the project implementation agency (PIA), GIZ. Preparatory activities include diagnostics activities, conducting a global review of MFI policies and regulations, finalizing program design for both project components, drafting the project operations manual, and ongoing engagement with public and private sector stakeholders. The WBG has been working closely with the CBI on preparations of Component 1 activities, described in more detail below. Component 2 activities largely target and benefit private sector actors but are closely linked to Iraq’s business environment reforms agenda surfaced under a sister project, the Enabling Environment for the Creation and Growth of Innovative Small and Medium Enterprises (P171175) ASA. STATUS  Pipeline PROJECT To test the effectiveness of selected financial and firm-level interventions in providing liquidity, building capacity for targeted small and growing businesses DEVELOPMENT (SGBs), and mobilizing private investment. OBJECTIVE BRIEF PROJECT The CARP project will test interventions that strengthen the resilience of viable MSMEs and support the viability and sustainability of their intermediaries in the DESCRIPTION aftermath of the COVID-19 pandemic. Business continuity will be achieved through: (a) the provision of financial support to MSMEs and innovative local private solutions during the recovery phase and (b) the implementation of mitigation measures at firm-level supporting SBGs. TIMEFRAME  October 2021–October 2023 SECTOR CONTEXT  Prior to the pandemic, economic diversification and improving private sector competitiveness were identified as key priority areas by I3RF donors and the GoI. Iraq has unrealized SME potential. Most Iraqi MSMEs are informal and concentrated in low productivity sectors. Despite a challenging business environment, a few high-growth firms (HGFs) are emerging. The COVID-19 pandemic has exacerbated structural challenges in Iraq’s business environment. Microenterprises suffer disproportionately from low financial intermediation and are offered limited financial products. The microfinance sector is one of the relatively smallest and least developed in the Arab region. MFIs have faced various challenges due to the economic slowdown driven by conflict and political unrest over the past two decades and have more recently also been affected by the pandemic. Iraq’s nascent entrepreneurship ecosystem requires systematic support for intermediary organizations, or business enablers, and other business development services (BDS) providers including business coaches, business consultancy firms, and technical advisers. 123 COMPONENTS  Component 1: Financial Inclusion: (i) Sub-Component 1.1: Provision of liquidity support to most affected micro and small business owners through MFIs; and (ii) Sub-Component 1.2: Strengthening the legal and institutional framework for MSME finance in Iraq. Component 2: SME-Support Measures: (i) Sub-Component 2.1: Enhancing SME capabilities and resilience through blended learning, vouchers and matching grants; and (ii) Sub-Component 2.2: Catalyzing private investment in SGBs through ecosystem support grants. Component 3: Project Management: (i) As outlined in the Project Appraisal Document , the CARP project will finance project management costs over the project’s lifecycle. In addition to drafting TORs for additional PIA staff and consultants, the WBG team is providing support to draft and finalize the POM. One comprehensive POM will be drafted, covering all project activities. Component 4: Contingent Emergency Response Component: Currently not applicable. FINANCING   I3RF: US$15 million LINKAGES TO This project also leverages synergies with We-Fi Iraq. While this activity is funded by the Iraq ASA, Enabling Environment for the Creation and Growth of OTHER PROJECTS/ Innovative Small and Medium Enterprises (P171175), it will align with activities conducted under sub-component 2. We-Fi Iraq will provide customized advisory INITIATIVES   support to Iraqi business enablers on their gender-lens programming. It will also support promising women-led SGBs on the capital-raising process. This activity   leverages implementation lessons from We-Fi Pakistan and is a continuation of the Mashreq Gender Facility’s (MGF) gender-lens programming activities completed in June–July 2021. This project also leverages synergies with the ongoing Iraq ASA, Financial Sector Reforms Cluster (P171615), which has supported the activities under sub-component 1 to provide immediate liquidity support and technical assistance to microfinance institutions (MFIs) affected by the COVID-19 crisis on the one hand and strengthen the legal and regulatory framework governing MSME finance in Iraq on the other. LINK TO GOI This project links to the GoI’s reform agenda on Economic Diversification, Private Sector Development, Business Environment Reforms, Financial Inclusion and REFORM AGENDA Financial Regulatory Reform. TYPE OF SUPPORT Technical Assistance, Advisory Support, Analytics. GENDER EQUALITY Contributes to economic empowerment of women and girls, improving data on gender and improving laws and policies affecting women. There is very little & WOMEN information on women’s labor force participation in Iraq except that the private sector has poor gender balance. 99 percent of MSMEs are informal but it’s EMPOWERMENT unclear what percentage of these are women-owned. Additionally, women-owned, and women-operated businesses are scarce—in 2011, only 7 percent of firms had a female owner while only 2 percent had a female manager. We-Fi Iraq takes a two-pronged approach to advancing women’s economic participation. First, it targets business enablers (such as the Station, FiveOne Labs, Innovest) and provides technical assistance on how to augment their gender-lens programming and outreach to women-led firms. Second, it also provides coaching, mentorship, and access to financial networks for women-led SGBs during the capital raising process. CLIMATE CHANGE & This project will identify key sectors for MSME and SGB support. The team will make additional efforts to support climate, or green entrepreneurs. THE ENVIRONMENT COVID RESPONSE & This project will provide much needed financial and technical support to MSMEs, small and growing businesses (SGBs), and key providers (such as MFI IMPACT institutions, business enablers). During COVID-19, MSMEs and SGBs are less likely to have financial liquidity to weather business shocks. IMPLEMENTATION The WBG has identified GIZ as the implementing agency. This project is led by the Finance, Competitiveness, and Innovation GP with cross-support from CGAP. ARRANGEMENTS  124 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES N/A – the project was recently signed. The project expects to benefit 1,360 MSMEs of which 30 percent are women-led. The project also expects to improve & RESULTS the operations of four financial intermediaries and mobilize US$4,350,000 of private capital. FROM JANUARY TO DECEMBER 2021 IMPLEMENTATION The project was endorsed by the I3RF Steering Committee and approved by the Regional Vice President on June 25th, 2021. However, the signing of the Grant CHALLENGES Agreement with the WB and the Implementation Agreement between the Ministry of Finance and GIZ was signed on October 1, 2021. Given this delay, the project team has focused on preparatory activities including identifying additional resources for the implementing agency. BENEFICIARIES The key beneficiaries to receive financial and nonfinancial support will be MSMEs that do not have access to the traditional banking sector such as informal firms, micro, small and medium formal firms, and SGBs (a subset of SMEs), which are small businesses with innovative, scalable business models and significant potential for growth. GEOGRAPHIC National level. COVERAGE  Enabling Environment for Small and Growing Businesses – BE activity P CODE P171175 GOVERNMENT The Economic Reform Unit (ERU) at the Prime Minister’s Office; Higher Steering Committee for Improving the Business Environment in Iraq at the Council of COUNTERPART Ministers; CBI. READINESS & A new Higher Committee to lead the implementation of the National Agenda for Improving the Business Environment in Iraq (former committee was dissolved GOVERNMENT last year) was established on June 1st, 2021, by the Secretary General of the Council of Ministers. This inter-ministerial body reports directly to his Excellency ENGAGEMENT the Prime Minister and is composed of officials from government entities with roles in the business environment. The Committee’s mandate is to work on proposals for legislative instruments, new policies, and development of new systems to improve the business environment. The main beneficiaries are agencies involved in the business environment reform agenda such as the Ministry of Planning, Ministry of Trade, Ministry of Justice, Central Bank of Iraq, Amanat Baghdad, private sector and indirect beneficiaries such as innovative SMEs, ecosystem builders and SME-focused funds. The MoF and CBI are also project counterparts for a sister project, COVID-19 Adaptation and Recovery Pilot: Supporting Firms Resilience, Access to Finance and Growth in Iraq (174273). STATUS  Active PROJECT To contribute to improving the quality and reliability of entry and support services for small businesses and entrepreneurs in Iraq. DEVELOPMENT OBJECTIVE BRIEF PROJECT This project will provide (i) advisory support for horizontal improvements in the overall business environment, and (ii) advisory support to develop a policy DESCRIPTION agenda around supporting small and growing enterprises in Iraq, and technical assistance on the implementation of selected interventions based on this policy agenda. 125 TIMEFRAME December 2019–June 2022 SECTOR CONTEXT  Iraq’s economic condition was gradually improving following the deep economic strains of the last three years. However, the current unrest and COVID-19   pandemic highlights the continued fragility of the country and the imperative to improve economic opportunities, particularly for youth. Uncertainty and risks for businesses remain high, particularly for small and new enterprises. While this poses additional challenges for small businesses, a weak and unpredictable business environment, lack of pro-growth policies, poor government services, limited capacity of firms, and lack of support for small businesses and entrepreneurs are perennial, and hamper private sector development in Iraq. COMPONENTS  Component 1: Business Environment Reforms: (i) In April 2021, through 10 virtual workshops organized by the Prime Minister’s Office with over 25 different   government agencies, the project identified reform priorities and drafted reform action plans (National Agenda for Improving the Business Environment in Iraq), taking into account where government intervention is most likely to achieve results, and prepared associated reform action plans in the priority topics, (ii) Started the support to the Central Bank of Iraq to further improve the credit information system within the Central Bank and/or through a private bureau. To that effect, the following is work in progress: Analyze the gaps in collecting credit information in the credit registry held by the Central Bank, including the CBS system; Increase data coverage (currently at 1.3 percent), defined as the number of individuals and firms listed in a credit registry or a newly-created credit bureau’s database; Create a Working Group comprised of members of the Central Bank, Ministry of Justice, Baghdad Chamber of Commerce (Bank Association) to perform the tasks below. Component 2: C-JET Iraq Investment Protection and Retention: Investors’ Grievances and Investors’ Dispute Settlement: (i) To support the finalization of a modern Arbitration Law, and the related institutional and implementation arrangements, based on best international standards and the UNCITRAL guidelines, including full and effective implementation; (ii) To support implementation of the already approved law for Iraq’s accession to the New York Convention to ensure investor confidence regarding recognizing and enforcing foreign arbitral awards (iii) To build local capacity on arbitration in the country to effectively implement the New York Convention and the new Arbitration Law. Component 3: Policy Priorities to Support Firm Growth: (i)The team provides Technical Assistant to select SME funds targeting Iraqi firms, (ii) Completed the Policy Note: Iraq Private Sector Fund and presented it to the Ministry of Finance in August 2021, (iii) MSME Financing Facility. The funding facility will have three main components – equity financing (Indirect Fund of Funds facility and Direct Co-investment facility), Line of Credit facility for MSME financing intermediaries, and pre-investment and ecosystem support grants. Component 4: Refugee Investment and Matchmaking Platform’s (RIMP): (i) The Refugee Investment and Matchmaking Platform (RIMP) Iraq operation is piloted under pillar II of the Enabling Environment for the Creation and Growth of Innovative SMEs project (P171175). RIMP is building on lessons learned from its project that was successfully implemented in Jordan (2018–2021) to extend support to Small and Medium-Sized Enterprises (SMEs) in Iraq to promote backward-forward linkages to support SMEs and grow exports. The proposed scope will target SMEs in the Kurdistan region in northern Iraq in which there is a high concentration of refugees and IDPs. RIMP’s project will be implemented in three phases over 3 years. Component 5: We-Fi Activities: this activity is not funded by the I3RF; however, it is a critical component of this project and the CARP project . We-Fi Iraq will provide customized advisory support to Iraqi business enablers with gender-lens programming, and promising women-led SGBs on becoming investment reading and engage in the capital-raising process. FINANCING   I3RF: US$2.2 million; We-Fi financing of US$400,000; C-JET financing US$200,000 LINKAGES TO The activities leverage resources from the MENA Tech Initiative, a multi-practice initiative within the WBG, and on-going projects led by other FCI teams, IFC OTHER PROJECTS/ Advisory, IFC Investments, and the Social Protection and Jobs, MTI, Governance, Digital Development, and Education GPs. The project also leverages synergies INITIATIVES   with We-Fi Iraq. While We-Fi activities are not directly funded by the I3RF, it is considered a critical component of this project and is described in the activities   above. 126 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project LINK TO GOI The project contributed to drafting of the Private Sector Development Chapter in the Government of Iraq White Paper. It also links to the GoI’s reform agenda REFORM AGENDA on: Economic Diversification, Private Sector Development, Business Environment Reforms, Financial Inclusion, and Financial Regulatory Reform. TYPE OF SUPPORT Technical Assistance, Advisory Support, Analytics and Investors’ Grievances and Investors’ Dispute Settlement. GENDER EQUALITY This project contributes to the economic empowerment of women and girls, improving data on gender, and improving laws and policies affecting women. & WOMEN There is very little information on women’s labor force participation in Iraq except that the private sector has poor gender balance. Ninety-nine percent of EMPOWERMENT MSMEs are informal but it’s unclear what percentage of these MSMEs are women-owned. Additionally, women-owned and women-operated businesses are scarce—in 2011, only 7 percent of firms had a female owner while only 2 percent had a female manager at the top. We-Fi Iraq takes a two-pronged approach to advancing women’s economic participation. First, it targets business enablers (such as the Station, FiveOne Labs, Innovest) and provides bespoke technical assistance on how to augment their gender lens programming and outreach to women-led firms. Second, it also provides coaching, mentorship, and access to financial networks for women-led SGBs during the capital raising process. CLIMATE CHANGE & This project will identify key sectors for MSME and SGB support. The team will work to ensure policy recommendations pave the way for future support to THE ENVIRONMENT climate, or green entrepreneurs. COVID RESPONSE & While this project will not respond directly to COVID-19, it will identify interventions applicable to the current context. During COVID-19, MSMEs and SGBs are IMPACT less likely to have financial liquidity to weather business shocks, and globally, the public sector has played a key role to minimize negative shocks for MSMEs and large businesses. IMPLEMENTATION This project is led by the FCI GP with cross-support from other FCI teams including the Investment Climate team, the MTI GP, and the IFC. ARRANGEMENTS  KEY DELIVERABLES The work under this project throughout the past year led to the adoption of the Private Sector Chapter in the White Paper which includes the National Reform & RESULTS Agenda for improving the Business Environment in Iraq. The team also completed the policy paper for small and growing businesses in Iraq. Two dissemination FROM JANUARY TO events, attended by the public and private sectors, for the National Agenda for Improving the Business Environment in Iraq were delivered. DECEMBER 2021 Pipeline deliverables include: Design and concept for a MSME Financing Facility; Disbursement of ecosystem support grants resulting in mobilization of private investment in SGBs; Enhancing SME capabilities and resilience through blended learning, vouchers and matching grants – this will be scaled up under the CARP project; and Implementation of investment readiness program for women-led firms. IMPLEMENTATION Travel restrictions to Baghdad remain a challenge. CHALLENGES BENEFICIARIES Key beneficiaries include Government counterparts; the private sector, including ecosystem builders and SME-focused funds; and innovative SMEs including women-led and refugee-owned firms. GEOGRAPHIC National level. COVERAGE  127 PILLAR 3: COORDINATION AND PROGRAM SUPPORT 3.2 EVIDENCE AND DATA ON POVERTY, VULNERABILITY AND DISPLACEMENT Building Evidence for Policy Making – BE activity P CODE P170264 GOVERNMENT MoP, Central statistical Organization (CSO), and Kurdistan Regional Statistics Office (KRSO) COUNTERPART READINESS & The team is working closely with the CSO and KRSO to prepare the IHSES-III survey and has collaborated with MoP to update the poverty projections. The GOVERNMENT phone survey reports, and other analytical works are shared with the CSO and KRSO. ENGAGEMENT STATUS  Active PROJECT To help Iraq make key policy decision based on evidence by strengthening the design, implementation and targeting of reconstruction and reform interventions DEVELOPMENT by ensuring data collection and analytical efforts to capture and address the needs of vulnerable and displaced populations and by testing new approaches to OBJECTIVE addressing implementation challenges. BRIEF PROJECT The proposed work includes two workstreams: (i) An extended program of technical assistance and capacity building for the CSO for the collection of household DESCRIPTION expenditure data and other key socio-economic data; and (ii) pilot innovative data collection methods to complement the main household survey collection. These pilots would explore data collection at a higher frequency, more focus and at much lower cost than normal surveys. The second workstream under this program would pilot innovative methods of data collection to obtain timely information on welfare and monitoring of project implementation. Due to urgent data needs during the COVID-19 pandemic, the program was modified to include phone surveys to collect timely information on the impact of COVID-19 on individuals and businesses, and consequently to better inform policymaking. Capacity building of the statistical office staff is included in both workstreams. Furthermore, an interim Poverty Map is developed and shared with MoP/CSO to help the GoI with emergency programming. TIMEFRAME  February 2020–September 2023 SECTOR CONTEXT  To understand Iraq’s welfare needs, and to prevent further conflict, data are required to inform policy making. Fiscal instability, poverty, unemployment,   and the vulnerability of a population ravaged by war highlight the imperative for evidential understanding of socio-economic conditions, so that policy and program trajectories can be established. Data on household needs and well-being are key for policymaking and poverty reduction interventions. The 2012 survey was used to construct a national Poverty Map at the sub-district level, which in turn was incorporated into the 2018 National Poverty Reduction Strategy. It is also being used to select sites for World Bank operations, and SFD. Such maps require on-going data renewal, including through less formal data acquisition means, if they are to remain current as policy design tools. The planned Population Census in October 2020 and household survey in 2021 presented great opportunities to both empirically update the Poverty Map and gather subjective data on poverty, employment, displacement, vulnerability, and perceptions of corruption and trust in institutions. However, COVID-19 meant the Census was not conducted and the survey was delayed. 128 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project COMPONENTS  Technical Assistance to the CSO and KRSO: The activity seeks to strengthen government capacity to collect key socioeconomic and poverty data through   intensive technical assistance for the upcoming IHSES and through updating the Poverty Map with the new census (if conducted). Data Innovation Pilots: This activity will pilot innovative methods of data collection to obtain timely (high frequency) information on welfare, vulnerability and conflict risks. This stream also includes creation of an interim poverty map and CEQ-light to assess the distributional analysis of fiscal policy on poverty and inequality. Note: Although the program has two workstreams they are not two separate components. Additionally, due to delays in workstream 1 and urgent data need on the pandemic, the team switched to COVID-19 phone surveys which are related to workstream 2. Additional funding from the first workstream was restructured to support this activity. FINANCING   I3RF: US$1 million; Trust Fund for Statistical Capacity Building: US$165,000; JDC: US$68,000; Global Tax Program Multi-Donor Trust Fund: US$100,000 LINKAGES TO The data will allow for better design, targeting, and monitoring of government projects and programs, as well as World Bank and other donor projects, and aims OTHER PROJECTS/ to increase the effectiveness of all development financing including the World Bank’ SFD and other social protection TAs. In addition, a joint MoP-WB-UNICEF INITIATIVES   note in close collaboration with MoP, CSO and KRSO assessing the impacts of COVID-19 was produced in a short period of time and adopted as the official   report. The interim poverty map for KRI is helping guide targeting of COVID-19 emergency responses, and its expansion to the rest of Iraq will support similar measures implemented by the GoI or the World Bank. LINK TO GOI (i) public sector and pension under Axis 1.1, (ii) electricity and custom tariffs under Axis 1.2, and (iii) social protection under Axis 4.2. REFORM AGENDA TYPE OF SUPPORT Technical Assistance and Analytics GENDER EQUALITY The project contributes to improving data on gender. Iraq lacks recent data to monitor household poverty and welfare and therefore lacks recent gender- & WOMEN disaggregated welfare indicators, in particular, on poverty, inequality, labor market, schooling, health etc. The upcoming labor-force-survey, I-WISH and IHSES- EMPOWERMENT III will fill the evidence gap related to gender in Iraq. The IHSES-III is designed to measure various welfare indicators by gender. Therefore, the activity will strengthen the evidence-base on gender gap and inform differential impact of the pandemic. The CEQ-light will reveal the distributional impacts of fiscal policies on women in Iraq. CLIMATE CHANGE & The project takes climate considerations in its implementation; the survey will collect light-information on the impacts of climate change on livelihoods, and THE ENVIRONMENT any mitigation measures employed. Some of the analytical work, such as microsimulations of distributional impacts, will also feed into the country’s climate diagnostic review (CCDR). COVID RESPONSE & Poverty projections and the note estimating the impact of COVID-19 on household poverty and vulnerability were produced using simulation modelling. Nine IMPACT rounds of phone surveys were conducted with WFP to monitor socio-economic trends, food security, and access to services (market, health education etc.) during the pandemic. The IHSES III questionnaire is adjusted to reflect the impacts of the pandemic on various dimensions of welfare in Iraqi households. IMPLEMENTATION The Poverty and Equity GP leads implementation. Components supporting project implementation are run in conjunction with the SPJ GP. Technical assistance ARRANGEMENTS  is provided to MoP, CSO, and KRSO. The updated Poverty Map uses IOM displacement data. The COVID-19 phone surveys are being done in collaboration with   WFP. The COVID impact report for the GoI was carried out in collaboration with MoP and UNICEF. 129 KEY DELIVERABLES An interim update of the 2014 Poverty Map was created and finalized and shared with MoP for review. The interim map and targeting formula will help guide & RESULTS targeting of COVID-19 emergency cash transfer pilot by SPJ and KRG. Similarly, the Education team is using the findings from the phone survey, the interim FROM JANUARY TO Poverty Map, and the poverty projections analysis to choose areas for their Primary Education Project. The poverty projections were updated to reflect DECEMBER 2021 projections at governorate levels at the request of the MoP to help the government’s planning and budgeting. Similarly, a paper examining the role of PDS on household welfare during displacement was published in 2020. A note exploring the impact of COVID-19 on poverty and vulnerability was released in collaboration with the MoP and UNICEF in 2020. Four rounds of data were collected as part of the high-frequency phone survey in 2021 (5 in 2020 and 3 firms survey in 2020) and two reports covering the first 6 rounds are already published. As part of the TA, the team has been providing IT training to CSO and KRSO staffs to build capacity. Till now 16 (about 2hrs each) trainings sessions have been held on CSPro program for CAPI development, data management and monitoring. Through extensive consultation with the counterparts (and through their consultation with the line ministries), relevant UN partners and the Bank’s teams working on Iraq, and the survey expert a version of questionnaire is developed. IMPLEMENTATION Currently, all the TA for IHSES-III is provided virtually. However, the weekly virtual trainings and meetings (connection, translation, etc. still an issue) might CHALLENGES not be as effective as in-person classes. The easing of travel restrictions and resumption of missions will greatly help, as counterparts have requested that important trainings are held in-person. BENEFICIARIES All institutions wanting to contribute to evidence-based policy making, including government agencies, the international community, civil society and academia. Indirectly, all vulnerable groups of interest (youth, women, IDPs, people with disabilities, and host communities in conflict areas) who were included in the surveys. GEOGRAPHIC National level program which covers all governorates, and the Poverty Map at district level. COVERAGE  Iraq Household and Socioeconomic Survey (IHSES) III – BE/RE activity P CODE P176590 GOVERNMENT MoP, CSO, and KRSO COUNTERPART READINESS & The grant agreement is ready for signing and awaiting action by MoF. The project was prepared in close collaboration with CSO and KRSO, who helped develop GOVERNMENT the Project Procurement Strategy for Development (PPSD), social safeguards and other related documents. The activities and project planning to draft the ENGAGEMENT Poverty Reduction Strategy III (PRS) was done in collaboration with the PRS secretariat at MoP. STATUS Pipeline PROJECT To support the GoI to collect quality data to produce poverty estimates and other key demographic and socioeconomic indicators to inform evidence-based DEVELOPMENT policymaking. The project will aid the CSO and KRSO in preparation and implementation of the third round of the Iraq IHSES III and MoP to draft the next PRS. OBJECTIVE 130 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project BRIEF PROJECT The project includes two activities. First is an RE activity, which will aid CSO and KRSO to prepare and implement the third round of IHSES III. While the WB DESCRIPTION team will provide extensive TA through the “Building Evidence for Policy” project, CSO and KRSO will implement the data collection for the national survey covering all governorates lasting 12 months to provide yearly qhada level welfare estimates and quarterly national level estimates. The second activity will support the drafting of the third national 5-year PRS III. Following a request from the PRS-Secretariat, the activity is designed as a BE activity. The activity will provide TA – both analytical and expertise support, and strategy and training workshops to help MoP staff to calculate different welfare indicators and monitor the progress of the PRS. TIMEFRAME  December 2021–October 2023 SECTOR CONTEXT  The recurrent and often violent security crises compounded with the budgetary crises that are pegged with the oil price down cycles pose a severe challenge   to monitoring poverty and welfare, precisely at times when and in a context where, it is most critical in Iraq. Previous surveys, IHSES I and II implemented in 2007 and 2012, respectively, and covering a period of relative peace and stability, have been vital in government planning and WB operations. For example, the second round of the survey from 2012 was used to construct a national Poverty Map at the sub-district level, which in turn was incorporated into the 2018 National Poverty Reduction Strategy. It is also being used to select sites for World Bank operations, and by SFD. The existing data, however, dates back to 2012, and Iraq needs a robust statistics program and updated surveys and censuses. Iraq’s last population census was conducted in 1997 but without the governorates of the Kurdistan Region of Iraq. Because of COVID-19, the Population Census of late 2020 and the third round of IHSES were both postponed. While the country implemented the latest round of the Multiple Indicator Cluster Survey (MICS) in 2018, data for a nationwide Labor Force Survey (LFS) does not yet exist. According to the World Bank’s Statistical Capacity Indicator (SCI), Iraq scored 36.7 and 34.4 out of 100 in 2020 and 2019 respectively. Given the economic crises in 2014 and 2020, conflict and displacement (2014 onwards), and the COVID-19 pandemic the country has suffered since, there is an urgent need to monitor current socioeconomic conditions and avoid the risk of data deprivation at a time when it is most critical. The upcoming LFS, I-WISH, this project, and IHSES-III will fill some of the current data gap. COMPONENTS  Component 1. IHSES III Iraq CSO (US$3.41 million) – RE: This component will support the CSO to implement IHSES III in the 15 governorates of federal Iraq, and   to prepare a survey, including but not limited to piloting and pre-testing conducting trainings for master trainers, enumerators and field supervisors, print and translate the questionnaire, survey manuals etc., and acquire goods and services needed to implement the survey. In addition, the grant will support survey field work – transportation, remuneration for field enumerators and supervisors, and other operation needs –, auditing, and data processing for analysis of results. Component 2. IHSES III Kurdistan-Iraq KRSO (US$0.95 million) – RE: As in the first component, the second component includes all the necessarily preparation and implementation support for the KRSO to implement the IHSES III in the Kurdish governorates of Iraq. It will help the KRSO to pilot the survey, conduct trainings for master trainers, enumerators and field supervisors, print and translate the survey instrument, manuals and maps, and for KRSO to acquire goods and services needed to implement the survey. The component will also support the fieldwork and the data processing for analysis of results. Component 3. Drafting of the third Poverty Reduction Strategy (PRS III) (US$0.61 million) – BE: With the second strategy coming to end, the third PRS will be prepared in 2022. The component will support and organize multiple workshops for the to-be-formed High Committee for Poverty Reduction Strategy (HCPRS) and various experts to delve and evaluate the PRS-2 and devise a new strategy based on the latest statistical evidence. Similarly, it will help to retain the services of an international expert, and multiple local experts to train MoP staff to prepare indicators, monitor PRS III activities, and also to provide overall coordination and drafting of the strategy under the guidance of the High Commission. FINANCING   I3RF: US$4.97 million (US$610,000 BE; US$4,360,776 RE) LINKAGES TO The data will allow for better design, targeting, and monitoring of government projects and programs, as well as World Bank and other donor projects, and aims OTHER PROJECTS/ to increase the effectiveness of all other development financing including the World Bank’s SFD and other social protection TAs. Similarly, the data will be vital INITIATIVES   to update the targeting formula for MOLSA’s CT program. 131 LINK TO GOI The multi-topic national household survey provides information on almost all aspects of household welfare and is vital to monitor key economic and governance REFORM AGENDA reforms. The activity will directly underpin some of the analytical work needed to operationalize the GoI’s reform agenda. In particular, the data will be important in analyzing the distributional consequences of, and thus help to operationalize: (i) public sector and pension reforms under Axis 1.1 (rationalizing expenditures); (ii) electricity and custom tariffs under Axis 1.2 (enhancing revenues and improving cash flow); (iii) identify gaps between supply and demand in Iraq’s labor market under Axis 2.6 (human development and setting up a national strategy for education and training) and access to schooling under Axis 4.4 (implementing school construction plan); and (iv) establishing targeting criteria to reach the poorest and most vulnerable groups, and the gradual transition from ration cards to cash assistance under Axis 4.2 (redraw the social protection system completely, and standardize different types of support). The next poverty strategy will evaluate the current PRS 2018–2022 and re-diagnose the Poverty and Wellbeing Draft Strategy based on national priorities including the reform agenda. TYPE OF SUPPORT Technical Assistance and Analytics GENDER EQUALITY The project contributes to improving data on gender. Iraq lacks recent data on household poverty and welfare, and especially gender-disaggregated welfare & WOMEN indicators on poverty, inequality, the labor market, schooling, health etc. The upcoming labor-force-survey, I-WISH and IHSES-III will fill the evidence gap related EMPOWERMENT to gender in Iraq. The survey is designed to measure various welfare indicators by gender. The activity will strengthen the evidence-base on gender gap and inform differential impact of the pandemic. The data will allow an analytical focus on the barriers and possible solutions to female economic empowerment, a priority for PRS-2, which will directly inform the preparation of PRS III. CLIMATE CHANGE & The survey will collect light-information on the impacts of climate change on livelihoods and mitigation measures employed, and will aid understanding of the THE ENVIRONMENT potential impacts of climate change on Iraqi households and communities. COVID RESPONSE & The IHSES III questionnaire is adjusted to reflect the impacts of the pandemic on various welfare dimensions of Iraqi households’ welfare. IMPACT IMPLEMENTATION CSO and KRSO are the implementing partners for IHSES III data collection; the PRS-secretariat and MoP will lead the drafting of the next PRS. The Poverty and ARRANGEMENTS  Equity GP leads the technical assistance, project preparation and other needed support for the project. KEY DELIVERABLES The project aims to support the GoI to adopt evidence-based policy making and Bank’ s operations to be better selected, designed, targeted and implemented to & RESULTS enhance their impact on poverty and equity. The project will help fill the current data gap in the country and provide evidence on socio-economic development, FROM JANUARY TO labor market, gender gap, food security and the impacts of COVID-19 on different sectors and population groups in Iraq. The data will also be important in DECEMBER 2021 understanding the drivers of conflict, the design and targeting of government and Bank activities, and the case for private sector investments with respect to private demand. Furthermore, the data will be vital in operationalizing, monitoring, and assessing the GoI’s White Paper reform agenda through poverty and equity lens. IMPLEMENTATION Delays in signing the project agreement. Currently, all the TA for IHSES-III is provided virtually. However, we believe that weekly virtual trainings and meetings CHALLENGES (connection, translation, etc. still an issue) would be more effective in-person, and thus, the easing of travel restrictions and resumption of missions will greatly help. Counterparts have also requested that important trainings are held in-person. BENEFICIARIES The direct beneficiaries of this project are MoP, CSO, and KRSO. However, the final anonymized micro-data will be published for public use and hence, all users including government, donors and development partners, academia, civil society, and NGOs will benefit from the project. Indirectly, all vulnerable groups of interest (youth, women, IDPs, people with disabilities, and host communities in conflict areas) who are included in the surveys will benefit. GEOGRAPHIC National level - the survey covers all governorates, and PRS III is the Government strategy for all of Iraq. COVERAGE  132 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project 3.3 ENHANCED SUPERVISION, FIDUCIARY AND RISK MANAGEMENT Fiduciary Oversight and Capacity Strengthening (includes Strengthening Financial Management and Procurement Capacities; and Third Party Monitoring Agent) – BE activities P CODE P174339 GOVERNMENT Task 1 (Third-Party Monitoring): MoP Public Contracting Directorate (PCD); MoCHMWP, Roads and Bridges Directorate, MoE, Ministry of Water Resources, COUNTERPART Ministry of Health, Ministry of Transport, Nineveh Governorate, Salah El Din Governorate, Anbar Governorate, Diyala Governorate. Task 2 (Fiduciary Capacity Building Program): MoP Public Contracting Directorate (PCD), MoF Public debt directorate, and Iraqi Union of Accounting and Auditing (IUAA). READINESS & Task 1. The WB team contracted the TPMA and is responsible for contract implementation, monitoring, and annual evaluation. The TPMA has fully mobilized GOVERNMENT a team of experts as required in the Terms of Reference since June 2020, and is coordinating with government counterparts to perform its task on the ground. ENGAGEMENT Task 2. The capacity building program will be implemented directly by a WB team of financial management and procurement specialists in close collaboration with government stakeholders. The Concept Note has been prepared, and project objectives and scope have been presented to the GoI. STATUS  Active PROJECT Increased fiduciary and technical oversight for World Bank financed projects in hard-to-access areas and strengthening the fiduciary capacity to manage DEVELOPMENT public funds with efficiency and integrity in Iraq. OBJECTIVE BRIEF PROJECT Task 1. Will ensure the funds proceeds of WB financed projects are used to its intended purposes as specified in loan/grant agreements and comply with DESCRIPTION the applicable fiduciary and safeguards regulations. This task will assist key implementing agencies of World Bank financed projects in Iraq to enhance their fiduciary knowledge and their monitoring capacity of different stakeholders. Task 2. Will build the fiduciary capacity of stakeholders involved in the implementation of Bank-financed projects in public procurement and financial management to ensure efficient and effective utilization of Iraq‘s resources. This will be achieved through on-the-job learning, training, and workshops under two umbrellas 1) the procurement capacity building program, and 2) the financial management capacity building program. This task also includes assessing and supporting a sustainable capacity building towards professionalization through Iraq’s universities. TIMEFRAME  June 2020–June 2022 SECTOR CONTEXT  As part of its fiduciary responsibility, the Bank is required to “make arrangements to ensure that the proceeds of any loan are used only for the purposes for which   the loan/grant was granted, with due attention to considerations of economy and efficiency and without regard to political or other non-economic influences or considerations”. Due to limited capacity of the implementing agencies in planning, procurement, financial management, and safeguards requirements, as well as a lack of transparency and accountability, the fiduciary risk of most of Iraq’s projects has been identified as “high”. To provide fiduciary assurance regarding the GoI’s use of funds proceeds and maximize the “value for money” of financed programs/projects, the Bank (1) hired a TPMA to support the Bank’s Task Teams to fulfil their monitoring and supervision obligations in areas where Bank staff are unable to access project sites (Task 1); and (2) will design and deliver a capacity building program to strengthen and develop the capacity of implementing agencies in the public sector and the business community in procurement and financial management, aiming for a sustainable Public Procurement Capacity Building Program towards professionalization through universities and other educational institutions (Task 2). 133 COMPONENTS  Task 1 . Third-Party Monitoring Agent   Task 2 . Fiduciary Capacity Building Program: (i) Sub-Task 1: Procurement Capacity Building Program; and (ii) Sub-Task 2: Financial Management Capacity Building Program FINANCING   I3RF: US$4.3 million LINKAGES TO Task 1. The TPMA is programmatic across the Iraq portfolio, and covers three projects, the EODP, the Social Fund for Development Project (SFD), and the Iraq OTHER PROJECTS/ COVID-19 Vaccination Project. Task 2. This task complements the current governance engagements, specifically the main two projects: (1) The Strengthening INITIATIVES   Public Financial Management Oversight and Accountability Institutions in Iraq project funded by the European Union (EU), which aims to strengthen institutions and mechanisms of fiscal accountability and oversight at federal and regional levels; and (2) The Modernization of Public Financial Management Systems Project, which seeks to improve financial information management and transparency, cash management, public investment management, and public procurement modernization at selected federal and regional agencies. LINK TO GOI Meets the White Paper requirements to develop governance/legal and administrative environments, to empower institutions and individuals to implement the REFORM AGENDA required reform and then ensure higher levels of efficiency, transparency, and accountability in the management of public investments and Public Procurement Contracts. TYPE OF SUPPORT Technical Assistance GENDER EQUALITY The project takes into consideration the economic empowerment of women and girls. The TPMA uses locally based field staff and provincial offices mostly & WOMEN located in Baghdad. The TPMA’s team has two women on board to interact more comfortably with women beneficiaries. The capacity building programs will EMPOWERMENT focus on including women participants and promoting their vital role in procurement and financial management. CLIMATE CHANGE & The project takes climate considerations in its implementation. Task 1. This project contributes to Climate Mitigation and Climate Adaptation by reducing THE ENVIRONMENT carbon footprint through combining site visits when possible. The TPMA uses innovative technology (i.e. geo-tagging when sharing pictures from the sites) to provide remote services as relevant. Task 2. The planned capacity building program will stress the importance of green procurement. COVID RESPONSE & Task 1. Following the COVID-19 outbreak and the Government’s request for support in responding to the pandemic, the scope of the TPMA was expanded IMPACT to conduct an urgent Environmental and Social Audit for the COVID-19 vaccination centers as a pre-requisite to complete the preparation of the necessary safeguards instruments required for the COVID-19 vaccines project under preparation. IMPLEMENTATION Task 1. The World Bank team contracted the Jordanian firm “Interdisciplinary Research Consultants” (ID:RC) to set the scope of Third-Party Monitoring. The ARRANGEMENTS  Bank’s Task Team is responsible for contract implementation, monitoring, and annual evaluation. ID:RC has deployed a team of experts as required in their   ToR of June 2020. The team is led by an international consultant, managing the contract by the Head Office in Amman, and operating on the ground through the local office with a local support team. The TPMA’s team coordinates with government counterparts for efficient monitoring and reporting. Collaboration among the relevant World Bank Global Practices happens through a cross-GP CMU working group established to ensure an effective coordination. Task 2. This task will be implemented directly by World Bank procurement and financial management specialists and in close collaboration with government stakeholders, in particular MoP. 134 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project KEY DELIVERABLES Task 1. The TPMA is engaged to cover Iraq’s portfolio which includes the I3RF. The contract was signed originally covering two I3RF active projects and has & RESULTS currently expanded to cover one more project; additional projects in the pipeline are expected to be monitored as soon as they become active. The TPMA has FROM JANUARY TO been providing extensive support to the WB’s Task Team to see that funds are used as per Loan/Grant Agreements. This activity has been a model across the WB DECEMBER 2021 to engage third-party monitoring for WB financed projects. This tool is one among several to strengthen supervision and implementation support and transmits a clear picture from the ground on the progress of contracts; this helps to improve engagement between the Government and citizens by transmitting feedback and complaints from citizens, and ensure efficient monitoring and support by the WB Task Team. Task 2 . Implementation delayed due to COVID-19 restrictions. IMPLEMENTATION COVID-19 restrictions have delayed this activity. CHALLENGES BENEFICIARIES Relevant government stakeholders with a special consideration to women/girls, and youth. GEOGRAPHIC Task 1. (i) Baghdad; (ii) Salah El Din Governorate; (iii) Anbar Governorate; (iv) Diyala Governorate; (v) Nineveh Governorate; (vi) Al Muthana; (vii) Duhok; (viii) COVERAGE  several cities across Iraq to conduct the audit for COVID-19 vaccination centers. Task 2. Implementation delayed due to COVID-19 restrictions. 3.4 PEACEBUILDING AND CITIZEN ENGAGEMENT Strengthening Peacebuilding, Governance and Citizen Engagement in Reform, Recovery and Reconstruction – BE activity P CODE P173326 GOVERNMENT REFAATO through the EODP and the Roads & Bridges Directorate/ Ministry of Construction, Housing and Public Municipalities through the Iraq Transport COUNTERPART Corridor Project (TCP). READINESS & The team responsible for component 3 of the ASA, which focuses on citizen engagement, has developed a theory of change and action plan that will see GOVERNMENT them engage more intensively with government and civil society representatives in FY22. The team is planning to engage with the MoP, the NGO Directorate, ENGAGEMENT the Ministry of Construction, Housing, Municipalities and Public Works, and select government entities that are already considered clients of ongoing I3RF operations and activities. Additionally, the team is providing support to the Iraq Country Climate and Development Report (CCDR) and may engage with the Ministry of Environment. STATUS  Active PROJECT Improving the effectiveness of World Bank engagement on reform, recovery and reconstruction in Iraq by integrating peacebuilding, governance and social DEVELOPMENT inclusion into policy dialogue and selected operations through hands-on advisory and analytical support. OBJECTIVE BRIEF PROJECT This project aims to provide the analytical foundations and operational support to promote peacebuilding across ongoing and future World Bank interventions DESCRIPTION in Iraq. It is structured around three components: (i) Deepening understanding and analysis on FCV dynamics; (ii) Operationalizing a “peace lens” to integrate peacebuilding, governance and political economy issues in the portfolio; and (iii) Piloting and mainstreaming citizen engagement approaches. 135 TIMEFRAME   January 2021–January 2023 SECTOR CONTEXT  The WB portfolio in Iraq is among the largest in all countries on the list of Fragile and Conflict-affected Situations. It comprises $2.06 billion of (IBRD) Investment   Project Financing (IPF) projects and a series of ASAs and forthcoming operations financed under the (I3RF). The World Bank’s engagement is diversified geographically and across sectors and includes a strong focus on supporting the implementation of the government’s reform agenda (notably via the I3RF). A FY2022-FY2026 Country Partnership Framework (CPF) has been prepared and emphasizes the need to adapt to the difficult context and high levels of fragility through the adoption of a Peace and Governance lens and a Citizen Engagement Roadmap. This programmatic ASA aims to enhance the effectiveness of World Bank engagement in support of reform, recovery and reconstruction in Iraq by improving the country team’s knowledge of FCV risk dynamics and by integrating peacebuilding, governance and social inclusion into selected operations and policy dialogue. This ASA is also aligned with the “Building for Peace” flagship report: the proposed stream of activities aims to contribute to a better understanding of local dynamics and actors, and to inform context-specific and area- based approaches for reconstruction. As such, it will provide an important vehicle to operationalize key findings and recommendations from the report notably a shift from simply “rebuilding the past” to addressing the existing grievances and the potential factors contributing to fragility. In addition, this ASA will support a key priority under the new World Bank Group’s Fragility Conflict and Violence strategy 2020-2025. COMPONENTS  Three components, each containing several deliverables: 1) deepening understanding on FCV risk dynamics; 2) operationalizing a “Peace, Governance and   Inclusion lens” to integrate peacebuilding, governance/political economy and inclusion issues in the portfolio; and 3) piloting and mainstreaming citizen engagement approaches. FINANCING   I3RF: US$1.2 million LINKAGES TO The project is supporting the situational awareness of Iraq’s FCV risks on a continuous basis. A number of key linkages with other teams have been established OTHER PROJECTS/ in the development of component 1b (dashboard). The core PBGCE team has engaged the Project Targeting Initiative (PTI) to develop a sub-national, weighted, INITIATIVES   multi-dimensional targeting index that will be integrated into the dashboard functionalities. The PBGCE team has also established links with the Geo-Enabling   initiative for Monitoring & Supervision (GEMS), to provide an overlay of portfolio mapping data which will be incorporated into the dashboard. Finally, the PBGCE team has also established links and an informal understanding to collaborate with the P360 initiative for hosting the dashboard on their tailored software (including their data repository tools). All three collaborations will enable the production and sustainability of a dashboard which offers project teams a powerful tool to assist them in their management of project and context-related risks. Under component 2, the team is providing technical support for the EODP’s grievance redress mechanism and beneficiary surveys, and technical support for the development of the Citizen Roadway Reporting System under the Iraq Transport Corridor project. It is also exploring opportunities to deepen linkages with other operations. LINK TO GOI The political economy analysis provided by the project under component 2, can inform the implementation of the reform agenda by highlighting political REFORM AGENDA economy challenges and bottlenecks. Under the White Paper’s commitment to improve government performance, Component 3 activities are geared towards providing support for local community participation in implementing programs and making use of international expertise in the area of governance. TYPE OF SUPPORT Technical Assistance, Advisory Support and Analytics PROVIDED BY YOUR PROJECT GENDER EQUALITY The project contributes to improving data on gender. Component 1 will provide an enhanced understanding of the disparities that exist between men and women, & EMPOWERMENT and boys and girls in Iraq. The dashboard will host a number of datasets that will contain gender disaggregation’s wherever possible, as a key lens for the user WOMEN to examine the data through. Gender disaggregated data will not only feature for indicators that measure risk, but will also be displayed as part of the portfolio mapping (i.e., beneficiary numbers that will be disaggregated by gender). It is only through a thorough understanding of the disparities that exist, that programming can be designed to address these gaps. Component 2 will factor gender issues into political economy analysis in support of WB ongoing and future operations. 136 I3RF ANNUAL REPORT 2021 Annex 3 – Progress Overview Per Project CLIMATE CHANGE & The project contributes to climate mitigation and climate adaptation. Under component 1, climate-induced forms of FCV will be included in the regular THE ENVIRONMENT monitoring of risks. In addition, a number of key climate indicators will be available on the dashboard platform. For instance, data pertaining to drought risk and to land use, will feed into at the least the pilot stage of the dashboard. This will help in designing climate-sensitive interventions. Component 2 will factor climate change related governance and political economy challenges into political economy analysis in support of WB ongoing and future operations. Under component 3, the team is engaging with the CCDR process to provide support to and enhance its consultations with stakeholders, including civil society on climate change and environment issues. This indirectly contribution to the WBG’s efforts to support the Iraq’s NDCs. COVID RESPONSE & The conflict monitoring work is taking place in close collaboration with a global effort to pilot COVID-19 unrest and conflict monitoring systems in six countries IMPACT including Iraq. The dashboard being developed as part of component 1 will include key data-points related to COVID-19 (i.e., cases, deaths, vaccinations). Ongoing peacebuilding analysis take into account the impacts of COVID-19 in FCV context. Finally, under component 3, the team is exploring piloting citizen engagement enhancing activities under COVID-19 response projects. IMPLEMENTATION The FCV Group, Governance and Social GPs jointly lead implementation of the activity. There is also a close coordination with the Poverty, Urban, Energy, and ARRANGEMENTS  the Social Development GPs KEY DELIVERABLES Under component 1 , following a competitive process to onboard a third-party entity to conduct analysis, a FCV risk monitoring framework to guide monitoring & RESULTS activities was completed in August 2021. Following and in line with the framework, a baseline assessment of risks was completed which outlines the risk FROM JANUARY TO landscape as of September 2021, and provides several risk pathways for how FCV may evolve in the context of Iraq going forward. This baseline risk assessment DECEMBER 2021 was followed by the first monthly risk briefs, and the first quarterly risk brief produced for the September – November 2021. In addition, a series of stakeholder consultations took place over July – September 2021. The purpose of the consultations was to identify existing risk monitoring initiatives in Iraq, to learn from the lessons of previous efforts to build dashboards in other FCV contexts, and to ensure that the dashboard would be tailored to inform projects design. Following these consultations, a concept note for the dashboard was developed, together with a draft presentation on the dashboard’s architecture and a list of indicators for consideration for dashboard visualization. The pilot form of the dashboard is due be presented by the end of the 2021 with plans for collaborating with the PTI, GEMS and P360 teams. Under component 2, two learning events have been organized (on the political economy of the 2022 budget and on the outcome of the 2021 election). Under component 3, the team has completed the deliverable documentation relating to a rapid stock take of WBG entry points. Additionally, the team has liaised with different project teams to engage in the citizen engagement enhancement efforts. For example, on the TCP, the team is supporting the upgrading of the Transport Corridor Project-level communications and monitoring platform, specifically in the form of developing an additional module to enhance CE processes and interactions. Under the EODP, the team has been providing technical support for the project’s grievance redress mechanism and beneficiary surveys. Moreover, the team, in collaboration with EODP team and REFAATO, is exploring designing a customized ICT- enabled CE solution. In preparation of the CCDR, the team is providing technical support on the design and implementation of the stakeholder engagement process. The CCDR team is also in the process of delivering a dialogue event on climate change with civil society. IMPLEMENTATION Restrictions imposed by the COVID-19 pandemic and the security situation limited the presence on the ground which is important for citizen engagement CHALLENGES activities. BENEFICIARIES WB project teams, select Iraqi civil society organizations and government entities GEOGRAPHIC National level. COVERAGE  137 Photo Credits: Cover page: Anmar Qusay/World Bank Page 4: Anmar Qusay/World Bank Page 6-7: Anmar Qusay/World Bank Page 8-9: Anmar Qusay/World Bank Page 12-13: Anmar Qusay/World Bank Page 14: Anmar Qusay/World Bank Page 16-17: Anmar Qusay/World Bank Page 20: Anmar Qusay/World Bank Page 24-25: Anmar Qusay/World Bank Page 26: Anmar Qusay/World Bank Page 33: Anmar Qusay/World Bank Page 37: Anmar Qusay/World Bank Page 40-41: Anmar Qusay/World Bank Page 44: Anmar Qusay/World Bank Page 49: Anmar Qusay/World Bank Page 52: Anmar Qusay/World Bank Page 54-55: Anmar Qusay/World Bank Page 56: Anmar Qusay/World Bank Page 64: Anmar Qusay/World Bank Page 73: Anmar Qusay/World Bank Designed by: Sarah Alameddine 138 I3RF ANNUAL REPORT 2021