Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) MDTF-Economic Revitalization of KP and FATA (P124268) SOUTH ASIA | Pakistan | Trade & Competitiveness Global Practice | Recipient Executed Activities | Emergency Recovery Loan | FY 2012 | Seq No: 9 | ARCHIVED on 08-Dec-2015 | ISR20123 | Implementing Agencies: Department of Industries, FATA Secretariat, SMEDA Khyber Pakhtunkhwa Key Dates Key Project Dates Bank Approval Date:22-Aug-2011 Effectiveness Date:11-Oct-2011 Planned Mid Term Review Date:26-Nov-2013 Actual Mid-Term Review Date:06-Dec-2013 Original Closing Date:30-Jun-2015 Revised Closing Date:12-Dec-2015 Project Development Objectives Project Development Objective (from Project Appraisal Document) To support the Government of Pakistan in the economic recovery and revitalization of the crisis affected areas of Khyber Pakhtunkhwa (KP) province and Federally Administered Tribal Areas (FATA), by creating sustainable employment opportunities through rehabilitation of Small and Medium Enterprises (SMEs), investment mobilization, and institutional capacity building. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name SME Development:(Cost $14.00 M) Attracting Investment from the Diaspora:(Cost $1.70 M) Institution Building to Foster Investment and Implement Regulatory Reforms:(Cost $4.30 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Satisfactory  Satisfactory Overall Implementation Progress (IP)  Satisfactory  Satisfactory Overall Risk Rating  --  Substantial 12/8/2015 Page 1 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) Implementation Status and Key Decisions ERKF became effective in October 2011 under the Round I of MDTF. As of Nov 15, 2015, the Project has overachieved most of its PDO indicators, disbursed US$16.34 million (81.7%) and has created and restored approximately 24,000 direct and indirect jobs in the KP-FATA region. The Project was due to close on Jun 30, 2015, however in response to the Government of Pakistan request, it has undergone two no-cost extensions in the PCD. The third extension was also endorsed by the MDTF Advisory Committee, and once approved, the revised PCD of ERKF will be June 30, 2016. The Bank task team carried out an identification scoping mission for the Project restructuring from June 2 - 12, 2015 to agree on the reallocations within the Project components. The extensions in the PCD will give the Project reasonable time to fully disburse the balance funds (US$3.6 million) of the Project. There is a strong demand from the region's SMEs for continued financial assistance through matching grants. This is evident from the fact that since its effectiveness, the Project received more than 9,000 applications for the matching grants. SMEDA PU is implementing Component 1 through a tripartite Memorandum of Understanding (MoU) between SMEDA, GoKP and GoFATA. Since FATA's targets have been achieved, it withdrew from this arrangement with SMEDA PU in Nov 2015. The GRMC and SMEDA PU will now focus entirely on the matching grants applications received from the SME clusters and individual SMEs from within KP. Both PMUs have completed the activities under Component 2 by organizing 5 outreach activities, including an Investment Road Show (IRS) in Dubai during Mar 2015. The KP-PMU is planning to organize the second International KP IRS in Mar 2016 in the United Kingdom (UK). The Component 3 activities are also on track and GoFATA has managed to conduct a number of successful skills training programs for FATA's youth including women. The counterpart capacity building efforts are ongoing and a team of five GoFATA officials is proceeding for an international training on private sector development operations from Dec 7 - 14, 2015. Key Decisions Starting Dec 1, 2015, and subject to ERKF’s extension up to Jun 30, 2016, the two PMUs and SMEDA PU have to undertake the following actions; 1. FATA-PMU and SMEDA PU to reconcile the amount of disbursed grants and identify any pending payments to SMEs; 2. KP-PMU to organize the second IRS in United Kingdom in Mar 2016 to mobilize Diaspora investment; 3. KP-PMU and PU SMEDA to collaborate closely to fully disburse Component 1 with a renewed focus on upgradation grants for SME clusters; 4. KP-PMU to follow-up on the LOIs signed during the Dubai IRS and submit a comprehensive report and evidence of the investment materialized by Dec 31, 2015; and 5. The two PMUs to complete the ongoing activities under Component 3 latest by Apr 15, 2016 12/8/2015 Page 2 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  --  Substantial Macroeconomic  --  --  Substantial Sector Strategies and Policies  --  --  Moderate Technical Design of Project or Program  --  --  Moderate Institutional Capacity for Implementation and Sustainability  --  --  Moderate Fiduciary  --  --  Substantial Environment and Social  --  --  Moderate Stakeholders  --  --  Moderate Other  --  --  -- Overall  --  --  Substantial Results Project Development Objective Indicators PHINDPDOTBL  Business Rehabilitation (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 1078.00 1204.00 850.00 Date 11-Oct-2011 01-Apr-2015 15-Nov-2015 12-Dec-2015 12/8/2015 Page 3 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) Comments Of the approved 1,341 matching grants for SMEs, the Project has disbursed 1,204 grants across KP (811 grants) and FATA (393) grants. Of these 24 grants have been awarded to 24 women entrepreneurs. The total value of these 1,204 grants comes to about US$10 million. PHINDPDOTBL  Jobs (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 23000.00 24000.00 8000.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments According to the estimates of the Third Party Monitoring Agent (TPMA), approximately 24,000 direct and indirect jobs were created and restored through ERKF matching grants. Of these, around 3,800 are direct jobs created/restored. The role of ERKF Project was appreciated by print media when a national English daily (Business Recorder) released numbers and updates on ERKF. The press release is attached. PHINDPDOTBL  Sustainability: 60% of all assisted SMEs operational and productive at the completion of the project (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 -- -- 60.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments This target will be measured at the Project end for the ICR. PHINDPDOTBL  Investments: US$ 10m attracted from Diaspora and migrant workers from KP and FATA (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 30.00 10.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments The GoKP signed LoIs worth US$ 1.2 billion at the Dubai IRS. The Board of Investment (KP) followed up on these LoIs, and KP-PMU has reported that one of those investors has already allocated an initial amount of US$30 million for an Oil Refinery in Karak (KP). 12/8/2015 Page 4 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) PHINDPDOTBL  Investment Facilitation Authority (IFA), FATA and Investment Facilitation Centre (IFC), KP established and operationalized (%) compl eted (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 100.00 100.00 100.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments These have long been established, and the Component 3 of ERKF is providing extensive establishment support to the KP's Board of Investment (BoI). The BoI participated actively in the organizing efforts for the Dubai IRS in Mar 2015. Overall Comments Intermediate Results Indicators PHINDIRITBL  SME Rehabilitation Support provided: 600 matching grants provided to SMEs meeting criteria (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 972.00 1057.00 600.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments This target stands overachieved. The number will increase since the total approved rehabilitation grants are 1,136. 12/8/2015 Page 5 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) PHINDIRITBL  Up-gradation Support: 250 SMEs benefit from the up-gradation grants (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 106.00 108.00 250.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments Target overachieved by the Project. PHINDIRITBL  Capacity Building & BDS Support: BDS provided to 500 SMEs/clusters (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 435.00 515.00 500.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments The Project has provided training through matching grants to 515 individuals and SMEs, and hence the target has been overachieved. PHINDIRITBL  Diaspora Outreach program implemented: At least 7 to 10 outreach activities/events successfully organized (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 5.00 5.00 7.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments The next activity (KP IRS in UK) is planned during Mar 2016, once the Project gets an extension of up to Jun 30, 2016. 12/8/2015 Page 6 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) PHINDIRITBL  Re-connect Pakistan (web tools for Diaspora) operational (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value -- 4518.00 5407.00 10000.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 PHINDIRITBL  PPD mechanism established in KP/FATA; defining economic growth and employment generation policy reforms; proposals for implementation submitted (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 6.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments No progress on this indicator so far. PHINDIRITBL  11 machinery pools/ common facility centers operational (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 2.00 11.00 Date 11-Oct-2011 01-Apr-2015 15-Nov-2015 12-Dec-2015 Comments The approval of grants for SME clusters upgradation only materialized during Nov 2015 with the award of grants to two clusters in KP. There is a pipeline of few more cases and more progress will be recorded over coming months once the Project gets an extension of up to Jun 30, 2016. 12/8/2015 Page 7 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) PHINDIRITBL  Recommended regulatory/institutional reforms introduced/notified by Industries Department for private sector development in KP (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 5.00 Date 11-Oct-2011 15-Jun-2015 15-Nov-2015 12-Dec-2015 Comments No progress on this indicator has been reported so far. Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P124268 TF-99175 Effective USD 20.00 20.00 0.00 16.34 3.66 82% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P124268 TF-99175 Effective 11-Oct-2011 11-Oct-2011 11-Oct-2011 30-Jun-2015 12-Dec-2015 Cumulative Disbursements 12/8/2015 Page 8 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MDTF-Economic Revitalization of KP and FATA (P124268) Restructuring History Level 2 Approved on 29-Jun-2015 Related Project(s) There are no related projects. 12/8/2015 Page 9 of 9 Public Disclosure Copy