96419 CLR Review For Official Use Only Independent Evaluation Group 1. CPS Data Country: Albania CAS/CPS Year: FY11 CAS/CPS Period: FY11 – FY14 CLR Review Period: FY11 – FY14 Date of this review: May 7, 2015 2. Overall IEG Assessment CLR Rating IEG Rating Development Outcome: Moderately Satisfactory Moderately Satisfactory WBG Performance: Good Good 3. Executive Summary i. This review summarizes the implementation of the FY11-FY14 Albania Country Partnership Strategy (CPS) and the CPS Progress Report (CPS PR) of FY13 and evaluates the CPS Completion and Learning Review (CLR). The strategy was joint between IBRD/IDA and IFC and this review covers the program of both agencies. The strategy was prepared in the wake of the 2008/2009 global financial and economic crisis, which changed Albania’s trajectory from one of rapid growth and poverty reduction to one of significantly slower growth and growing macro imbalances related to Government’s expansive fiscal stance (adopted in part to cushion the impact of the crisis on the poor). ii. In this context the CPS sought to strengthen Albania’s capacity to return to its pre-crisis high growth trajectory while ensuring adequate protection, including from climate change risks, for vulnerable population groups and maintaining past gains in human capital development. It was fully aligned with Albania’s national development strategy. The CPS comprised 3 pillars: (i) accelerating the recovery in Albania’s economic growth through improved competitiveness; (ii) broadening and sustaining Albania’s social gains; and (iii) reducing Albania’s vulnerabilities to climate change. iii. The strategy also sought to consolidate the WBG program in Albania, inter alia, through accelerating implementation of the inherited portfolio of 15 projects. The original CPS plan foresaw up to 12 new operations (including 4 DPLs) for a total resource envelope of $275 million. Subsequently, the Bank showed considerable flexibility by making an additional $300 million available to support Albania’s efforts to deal with the knock-on effects of the prolonged Eurozone crisis and address a flooding emergency. It also reduced the number of new operations to 8 (including 3 DPLs), thus improving selectivity and scale of the lending program and, with project closings, leaving just 6 ongoing projects by the end of the CPS period – a good starting point for a selective program under the Country Partnership Framework FY15- 19. iv. The CPS strategy had positive, albeit mixed, results and IEG rates the outcome as moderately satisfactory. The strongest performance areas were public financial management, financial sector, business climate improvements, roads and transport and pension reform. In contrast, the CPS program failed to achieve the desired objectives in some critical areas, including fiscal consolidation, energy generation and financial sustainability, as well as in its efforts to strengthen water resource management institutions. In terms of implementation process, the most noteworthy aspects were a strong focus on CLR Reviewed by: Peer Reviewed by: CLR Review Coordinator Neeta Sirur, Consultant, IEGCC Rene Vandendries, Consultant, IEGCC Geeta Batra, Igor Artemiev, Consultant, IEGCC Takatoshi Kamezawa, Senior Evaluation Manager, IEGCC Officer, IEGCC CLR Review For Official Use Only Independent Evaluation Group 2 portfolio implementation, close partnership with the donor community and excellent use of AAA to both inform lending and build consensus among local and national stakeholders on difficult policy measures such as fiscal consolidation, which eventually bore fruit in the final year of the CPS. While there was alignment in substance with the corporate twin goals, neither the CPS nor the CPS PR articulated the links between growth objectives and poverty. v. The results framework was too broad and overly complex, comprising 17 objectives and around 60 results indicators. It also suffered from the absence of measurable outcome indicators, especially with respect to IFC interventions. Indeed, those indicators in the results framework related to IFC activities in the CPS (related to inspections, permits, accredited laboratories, MSME loans) were dropped at the CPS Progress Report stage resulting in a tool of IFC instruments loosely related to the CPS objectives. This failure to set clear outcomes for IFC interventions and for joint or complementary Bank-IFC interventions, even when this cooperation was constructive and essential like in the electricity sector and investment climate, perhaps contributed to limited verifiable results of this cooperation during CPS implementation as well. MIGA was not active in Albania during the CPS period. vi. Despite the above shortcomings, IEG rates WBG performance as good overall, reflecting alignment with national strategies, the flexibility shown in increasing resource allocations to help address unfavorable external developments (floods, Eurozone deterioration), the resolute focus on portfolio consolidation, restraint with respect to new lending until key reforms were in place, and strong coordination with external partners in a number of sectors. High quality AAA and its effective use in building consensus for policy reform were also positive features. vii. Of the nine lessons included in the CLR, IEG highlights three as follows: (i) in the event of low political commitment to the reform agenda in high development priority areas, it is critical to build a broad coalition of support for reform in an open and transparent manner through high quality AAA and discussions with national stakeholders and international development partners to build a shared understanding of the stakes involved and leverage action; (ii) selectivity in strategy design is imperative in relatively low capacity countries such as Albania, especially when the Bank has a limited resource envelope -- the process of clearly specifying desired outcomes is an important support to achieving a selective CPS program, even when there are multiple needs; and (iii) in cases where there is already a scattered program of small operations it is vital to restructure the portfolio and accelerate implementation before embarking on new lending. 4. Strategic Focus Relevance of the WBG Strategy: Country Context: 1. Preparation of the FY11-14 CPS was undertaken in the first half of 2010, in the wake of the 2008/9 global financial and economic crisis. In the two decades preceding the crisis, Albania was one of the best performing countries in the ECA region, experiencing one of the fastest growth rates (6%) in the ECA region and a concomitant rapid decline in poverty. At the time of CPS preparation, the poverty rate had halved from its 2002 level of about 25%, extreme poverty affected a relatively small proportion (2%) of the population and the country was making steady advances towards achievement of the MDGs. In the immediate aftermath of the crisis, as well, Albania fared relatively better than its neighbors, but serious domestic vulnerabilities emerged in the macroeconomic, social, environmental and governance spheres, which reduced growth and eventually reversed some of the social gains of the preceding decade, giving rise to increases in poverty. On the environmental front, concerns centered on the heightened variability in weather patterns due to climate change, coupled with weak management of water resources, which had contributed to the increased frequency of severe flooding events (e.g., in 2010). CLR Review For Official Use Only Independent Evaluation Group 3 2. The CPS period was characterized by continuing Eurozone troubles, especially in Albania’s chief trading partners Greece and Italy, with negative impacts on Albanian economic growth. Domestically the period saw continuing fiscal problems and rising public debt. Declining investor confidence and a sharp drop- off in remittances slowed growth, which fell to 1.6 and 1.4% in 2012 and 2013 respectively, before recovering to slightly over 2% in 2014, according to the IMF. Moreover, Albania experienced severe flooding shortly after approval of the CPS with serious consequences for agricultural output and the livelihoods and incomes of affected households. Unemployment rose to close to 25%, reversing gains in poverty reduction. Conditions began to improve in the final year of the CPS period as the new Government instituted serious fiscal (including structural) and public financial management reforms, business climate improvements began to take hold and positive hydrological conditions affected both energy and agriculture. 3. Objectives of the CPS Strategy. The broad objective of the joint Bank-IFC strategy was to strengthen Albania’s capacity to return to its pre-crisis high growth trajectory while ensuring adequate protection (including from climate change risks) for vulnerable population groups and maintaining past gains in human capital development. The specific strategic objectives of the WBG-supported program as laid out in the CPS were three-fold: (i) accelerating the recovery in Albania’s economic growth through improved competitiveness; (ii) broadening and sustaining Albania’s social gains by improving access to social services and a strengthened safety net; (iii) improving the conservation, management and efficient use of its water resources and strengthening disaster preparedness. 4. Congruence with National Strategy. The objectives of the CPS strategy and the specific interventions included in the Bank program (ongoing and planned) were well aligned with the National Development Strategy (NSDI) which placed emphasis on actions in two main areas: (i) consolidation of the democratic system notably through electoral, judicial and property rights reform; and, (ii) achievement of rapid and sustainable economic, human and social development in line with EU criteria. –The CPS focused on the second of these goals. With respect to the goal of consolidating democracy, the Bank worked only on property rights, appropriately leaving electoral and judicial reform to other development partners (e.g. the EU). The CPS program was also supportive of the specific targets laid out in the NSDI (and endorsed by all parties) for 2013, including higher real GDP growth, a reduction in headcount poverty to below 10% of the population, introduction of a basic health package for all Albanians, an increase in secondary school enrollment to 76% of the age group and an strengthened social protection system. It was also aligned with Albania’s External Assistance Orientation Document (EAOD) which was developed by Government in 2008/9 to guide donor actions in the country and which more narrowly specified the main priority areas for donor engagement – namely, public administration/rule of law, economic policy, social development and infrastructure. Water resource management was subsequently added to the list in view of severe flooding in 2010. 5. Areas of Engagement. The WBG strategy included interventions that were generally well suited to contribute to the objectives of the country and the program, although actual outcomes were ultimately negatively affected in some instances (especially growth and fiscal consolidation) by the external environment and internal political pressures. In addition, there was a strong link between lending and AAA activities, with the latter both responsive to emerging needs and informing the design of lending operations. Moreover, there was good coordination with other donors active in Albania, including at the broader policy and program levels, in specific priority areas such as education and public sector administration, and via trust funded activities. The areas identified for joint or complementary Bank-IFC action took advantage of synergies between the two WBG arms, hence playing to the WBG’s comparative advantages. However, the indicators in the original CPS Results Framework related to IFC were later dropped. Considering IFC’s business model per which its main investment activities rely on its client relationships it was not easy to plan when its private sector transactions could take place. So, it is understandable that IFC’s operations may not be fully captured in the results framework at the preparation stage of CPS. It was not corrected though when the progress report was presented to the board in April 2013 when IFC’s contributions to the specific strategic objectives were clearer as many IFC investments were disbursed or at advanced stage of negotiations. The on-going and planned IFC interventions were listed in the progress report as WBG instruments without specifying results. CLR Review For Official Use Only Independent Evaluation Group 4 Absence of specific milestones and measurable outcomes made the IFC contribution to the country’s CPS unobvious. 6. Finally, it should be noted that while the areas of engagement taken individually were appropriate and likely to contribute to national and CPS goals, the originally envisaged program (including ongoing and new projects and IFC transactions) was also too thinly spread when viewed in the aggregate and in relation to the original lending envelope of about US$275 million. This was reflected in a somewhat unwieldy results matrix that included 17 outcomes to be assessed through 43 outcome indicators and 65 intermediate milestones in the original CPS, with the number of milestones subsequently reduced to 58 through the CPS Progress Report. The CLR candidly acknowledges this issue, deeming the original matrix to be “overly complex”. 5. Development Outcomes Overview of Achievement by Objective: Pillar 1: Accelerating the recovery in Albania’s economic growth through improved competitiveness 7. External factors, mainly the continuing Eurozone crisis as well as climatic events that affected energy and agricultural production had serious negative impacts on growth, despite some important advances with respect to the specific milestones included under this pillar. The pillar itself comprises 8 major outcome areas -- including fiscal policy, public expenditure management, public administration, business climate improvements, property rights, energy sector, roads and transport, and irrigation – each of which could plausibly be defined as a free-standing pillar in its own right. An additional area under this pillar, which is not mentioned in the texts of the CPS or CPS PR, and only briefly in the CLR, is the financial sector, for which the Bank approved and disbursed a $100 million DPL in FY14 (i.e., nearly 23% of total IBRD lending under the CPS). The outcomes areas are grouped below under 3 major results areas following the CLR categorization. (i) Sound macroeconomic management and improved public expenditure management 8. As a key element in maintaining macroeconomic stability, increasing investor confidence and, hence, supporting economic growth, this objective is clearly aligned with critical development needs and with Albania’s NSDI. The results indicators defined for purposes of this strategic outcome area were first and foremost aimed at achieving improved public resource management, with the goal of increasing the credibility and contestability of fiscal policy. To this end, specific indicators (derived mainly from the Integrated Planning Systems (IPS) project) focused on instituting a functional automated treasury system, regular publication of budget expenditure reports, use of e-procurement and establishment of an EU-compliant procurement complaints mechanism – all of which were well-suited to measuring developments in public financial management. The indicators/milestones were mostly achieved. Some delays in implementation meant that a few systems were continuing to be fine-tuned or enhanced at the time of writing the CLR, denying them a rating of achieved. While closely linked to the strategic objective, the indicators appear to focus more on outputs than actual outcomes. For example, going beyond the establishment of an e-procurement system, it would have been useful to include an indicator on the percentage of Government contracts going through the e-procurement system. In terms of IFC interventions, the successfully implemented SEE Tax Transparency and Simplification project which has delivered significant cost savings to the private sector should have had a measurable indicator/milestone in the results matrix of the progress report to support Outcome 1 dealing with credibility of fiscal policy in substance besides an ex-post reporting on its results in the text of the CLR. 9. Two additional indicators under this strategic outcome area pertain to enhancing the stability of the financial system. They address important systemic needs including the creation of a backstop facility to increase public confidence in Albania’s deposit insurance scheme and the conversion of foreign bank branches to full-fledged subsidiaries of the parent bank(s). These milestones were both achieved. The actions taken together with other financial system measures supported through a joint IMF-Bank FSAP and the Bank’s $100 million financial sector DPL helped to increase the resilience of Albania’s banking and non- CLR Review For Official Use Only Independent Evaluation Group 5 bank institutions through mitigating key vulnerabilities. It is likely to have played a major role both in helping to maintain macroeconomic stability and supporting business investment through improving the availability of credit. (ii) Improving business regulations and reducing compliance costs for the private sector. 10. The indicators and milestones included in the results matrix for this results area were grouped into 3 clusters. The first cluster focused on improving private sector satisfaction with the quality of regulations and included one true outcome indicator involving “satisfaction” surveys of the business community plus two indicators that were essentially output indicators (adoption of a new regulatory framework for business inspections and training for inspectors) supported through the BERIS operation. IFC’s successfully implemented regional project, the Indicator-based Reform Advisory, also helped to cut costs of doing business in Albania. It was not, however, related to agribusiness competitiveness as its title in the Results Framework implies. While the milestone indicators in the results matrix were closely related to Bank activities, the outcome measure concerning increased satisfaction of private business with the quality of regulations could derive from sources outside the sphere of influence of WBG-supported activities. It is worth noting that there is frequently some tension between attribution and a true outcome orientation, and the country team deserves credit for navigating it well in this instance by combining well-chosen outcome and output indicators. All three indicators were achieved and Albania rose by 22 positions in the WBG DBR rankings, going from 90th to 68th. 11. The second cluster focused on strengthening property rights and land administration through the Bank-financed Land Administration and Management Project (LAMP) -- in line with the priorities set in the NSDI. Here again, the results indicators included one true outcome indicator and two milestone indicators that help to establish a logical link between the Bank’s activities and the desired outcome. All three indicators were either achieved or surpassed. A National Property Rights strategy and an associated Law on Immovable Property Registration were adopted by Government by 2013, 10 of the largest property registration offices were fully computerized and the number of days needed for registering property transactions was cut from 30 in 2008 to 9.8 in 2012 – slightly improving on the target of 10 days set in the CPS. 12. The third cluster under business climate strengthening focused on achieving greater alignment between private sector practices within Albania and the practices/standards prevailing in the EU and other OECD countries, with a focus on accounting/audit, EU export standards and environmental requirements. IFC sought to improve private sector compliance with selected EU and international standards through its regional International Standards and Technical Regulations Program. Rated as mostly successful by IEG, the project was unable to submit measurable indicators that would prove verifiable impacts on firms’ exports to EU and other countries. Overall, this results area was clearly supportive of the NSDI’s overarching goal of eventual EU accession. Six specific indicators in this area included development of an EU-congruent audit oversight system, establishment of an EU-compliant metrology laboratory, annual publication of international financial reporting standards in Albanian language, creation of an on-line environmental permit application system and training of private organizations in account and auditing principles. The indicators, which were clearly linked to WBG-supported activities were all achieved over the 2012-2013 period. Two IFC Corporate Governance projects were also implemented in Albania during the CPS period – one national which was completed in 2012 and one regional being implemented now relying on the Albanian Corporate Governance Institute established by the first project. . (iii) Improved, and more financially sustainable, infrastructure services in energy, road transport and irrigation. 13. The third results area under Pillar 1 focused on improved infrastructure services. This cluster should perhaps have been separated off into a separate (albeit linked) Strategic Objective in its own right given its prominence in the NSDI and the large scope and number of Bank Group-supported activities and results indicators (14). Performance with respect to this cluster was mixed. By and large, road transport activities CLR Review For Official Use Only Independent Evaluation Group 6 proceeded as intended and attained or surpassed the specified results, while the energy program faced a number of hurdles. 14. The most successful aspect of Bank intervention in energy was electricity transmission, supported by a Bank project (Energy Community of S-E Europe APL 2) under which 5 transmission substations were rehabilitated (versus a target of 3), the Transmission System Operator was restructured and a new, market- oriented tariff regime was instituted. Outcomes were more elusive with respect to power generation and distribution. On the generation front, additional capacity of some 330 MW was completed versus a target of 800MW supported by the Power Generation Project. This, together with favorable hydrological conditions and transmission improvements, contributed to improved electricity availability in Albania and the virtual elimination of load shedding. However, a thermal power plant at Vlore has been stalled due to failures at offshore facilities, with negative implications for both the amount of energy generated and the diversification of energy sources. A 2009 WBG-supported initiative to privatize electricity distribution failed due both to inadequate investment by the private operator and government inaction on tariff adjustments and on controlling electricity theft– leading eventually to re-nationalization of the distributor. Finally, the energy sector remains financially unsustainable with low cost recovery and continued, widespread electricity theft. Of the 10 results indicators associated with energy sector development, only 3 were achieved, 2 partially achieved and 4 not achieved, while 1 remained unrated. 15. IFC’s presence was concentrated in the energy sector, albeit not sufficiently discussed in the CLR. None of the 5 IFC investments in the power sector and EE/RE financing is yet rated in DOTS, albeit some of them were approved a while ago. E.g., the results framework mentions the Renewable Energy and Small Hydropower Plants (SHPP) project which, since 2010, tries to address market barriers to investment in SHPPs to support the construction of 30 SHPPs with total installed capacity of 60 MW. The expected outcomes of this project are yet to be achieved due to delays in passage of enabling legislation. Other electricity projects should also be discussed in more detail and rated in DOTS, particularly, IFC financing to the private electricity distributor company whose license was subsequently revoked. The CLR noted the need for enabling policy and regulatory conditions for privatization transactions indicating that the privatization of the electricity distributor “provided some key lessons on how not to structure a deal”.. In several objectives outcomes are actually just outputs. E.g., in Output 7 an outcome indicator is formulated as signing cooperative agreements with five banks to implement the Residential Energy Efficiency Program, an output rather than outcome indicator. Though this output was not achieved due to absence of an appropriate legal and regulatory framework for implementing energy efficiency, the CLR cites the successful advisory project with the same name as having achieved a significant result by facilitating about 5,000 energy efficiency loans for a total of $20 million, benefiting more than 15,000 individuals cooperating with two microfinance institutions, two local banks and one foreign bank. 16. In contrast to energy, the CPS program with regard to road transport was very successful, with all results achieved or surpassed. CPS results indicators were directly linked to the FY07 Transport Project and the FY06 Secondary and Local Roads Project – which IEG rated “Satisfactory” and “Highly Satisfactory” respectively. The latter project connected 86 communities, rehabilitated about 1700 km of local roads and constructed about 119 km of new local and secondary roads. Each of these results far outstripped the original targets because the Bank operation was able to “crowd in” substantial donor resources and expand the program accordingly. The Bank also successfully supported institutional developments aimed at improving roads management and introducing innovations in maintenance. 17. IEG Rating for Pillar 1. IEG rates the outcome of the WBG assistance under Pillar I as Moderately Satisfactory. Of the 30 results/milestones 20 were achieved and 4 mostly achieved, while the remainder were either only partially achieved (2) or not achieved (4). On the face of it, this performance could justify a rating of Satisfactory, but the failure to achieve key outcomes such as enhanced growth or energy sector sustainability suggest that the whole was less, in this instance, than the sum of its parts. Success was most marked with regard to road transportation, where the CPS program not only surpassed many targets but also strengthened transport institutions and developed a broad sector-wide program in partnership with other donors as requested by Government in its external aid guidance. Important achievements were also CLR Review For Official Use Only Independent Evaluation Group 7 registered with respect to financial sector strengthening and public financial management (e.g., e- procurement, publication of budget outturns) but fiscal control was a challenge for most of the CPS period and growth rates remained well below pre-crisis levels. However, business climate improvements contributed to a 22-position jump in DBR rankings. This, together with the new Government’s focus on stronger, more prudent fiscal management and overall macro stability should position Albania for stronger growth once the external environment improves. This Strategic Objective was least successful in the energy sector, an area of Bank/IFC cooperation, particularly with respect to the Vlore thermal power generation project, which remains inoperable, and the re-nationalization of the electricity distributor following a series of disputes between the private operator and the Government. Pillar 2: Broadening and Sustaining Albania’s Social Gains 18. The goals of the strategy under Pillar 2 were to maintain and expand the pre-crisis gains in education and health, as well as to affordably protect poor and vulnerable population groups through consolidation of programs and expansion of effective safety net programs. Bank operations directly linked to these goals included an Education Excellence and Equity Project (EEEP), a Health System Modernization Project (HSMP), a one-off Social Welfare Reform DPL and an innovative results-linked Social Assistance Modernization Project SAMP). Lending was supported by pertinent AAA including policy notes and a Pension Reform TA. 19. Strategic Objective 2 was fully aligned with the NSDI and, relative to Strategic Objective 1, was better focused in its scope. More importantly, maintaining human development gains and protecting the poor was especially important at a time when the economy was beginning to stagnate and there was a sharp drop in the remittances that had sustained many families. Investments in human capital were also critical to efforts to accelerate growth and attract private investment. In this regard, with primary education already near universal, the CPS focus on secondary and higher education was appropriate, particularly in light of the poor coverage and quality at these levels. The results matrix included 8 indicators related to education (principally output measures), 5 pertaining to secondary education and 3 linked to higher education. Of the secondary education indicators, all but one were met or mostly met according to the CLR, however no evidence was provided to support this assertion. Particularly noteworthy was an increase in gross secondary enrollments (to 91%), the elimination of triple-shifting in schools and reduction in double shifting from 36% to 13.4%. However, the goal of institutionalizing a professional development program for teachers was not met and the existing program is still inadequately linked to the revised curriculum instituted under the EEEP. In higher education the goal of improving financial sustainability through a revised funding mechanism was only partially achieved, as was the effort to institutionalize a uniform higher education quality assurance system. Improvements to science education were put in place through improving equipment and pedagogical aids for university laboratories, but this was measured only through outputs rather than outcomes. The EEEP was also an important catalyst for donor coordination. 20. With regard to modernization of the health system, the CPS strategy focused on bringing primary and secondary (hospital) care under a single national health insurance umbrella, increasing the proportion of the population insured under the scheme, and establishing a basic benefits package for primary health care. It also sought to establish payment incentive mechanisms to fund hospitals on a performance basis. The insured population did increase substantially over the CPS period from <10% to about 60%, albeit short of the 70% target included in the results matrix. Reforms in primary health care were largely achieved (overall coverage, patient satisfaction, quality of care) but hospital financing was still only partially performance based by the end of the CPS period. The CLR rating of mostly achieved is appropriate for this area. 21. The main emphases of the CPS-supported social protection reforms were to: (i) increase the coverage and efficiency of the disability pension system and the relatively young conditional cash transfer program (Ndihma Ekonomike-- NE), and (ii) increase the financial soundness of the pension program through increasing the proportion of contributors to pensioners and implementing parametric reforms to improve the system’s longer term financial health. The CPS program made considerable progress in both areas. Bank TA and Policy Notes on pension reform contributed to passage of a new pension law mandating important CLR Review For Official Use Only Independent Evaluation Group 8 parametric reforms (including raising the pensionable age) and helped increase pension participation from about 30% to 35% of the workforce – actions that will increase the sustainability of the system in the longer term. Coverage of both NE and disability support has expanded in accordance with revised eligibility criteria and systemic improvements are in place, such as an electronic registry and upgraded management information system. Modernization of the disability system has suffered delays. 22. IEG rates the outcome of this Pillar as Moderately Satisfactory. The rating reflects the fact that the objectives and outcomes of the pillar were well aligned with country goals and needs and that CPS activities clearly played a direct role in furthering achievement of the goals. There were, however, significant implementation delays that affected the achievement of some indicators. Of 19 results indicators, twelve were achieved or mostly achieved (i.e., about 63%), six were partially achieved and one (pertaining to teacher training) was not achieved. By and large, with the exception of coverage outcomes, the results indicators included for this area of the CPS were related to process rather than outcomes. However, given the long lead times generally needed to observe the impact of investments in education, health and, especially, pension reform, the chosen indicators appear to have been appropriately calibrated to the CPS time frame. Pillar 3: Reducing Albania’s Vulnerabilities to Climate Change 23. Pillar 3 of the CPS sought to increase community participation in the conservation / management of forest and water resources, improve public environmental infrastructure and services at the municipal level, and establish a viable national water resources management framework (including establishment of a cross border water management institution to manage Lake Shkodra). These goals were not explicitly included in the NSDI but were firmly on the Government agenda by the time the CPS was prepared, in part due to the increasing frequency and severity of flooding events in some parts of Albania. The Strategic Objective was directly linked to several Bank-financed projects including the Natural Resources Development Project (NRDP), the Disaster Risk Mitigation Project (DRMP), the Environmental Services Project (ESP), the Integrated Coastal Zone Management Project and two Water Projects. In addition, a number of grants complemented the Bank lending in the area of resource management. 24. As reported in the CLR, the CPS effort to involve communities in the conservation and management of water and forestry resources was successful -- both in its environmental objectives and in creating new income generation opportunities for some 250 communities in forest and agriculture activities in micro- catchments. An estimated 220,000 tons of erosion was reduced and close to 129,000 tons of carbon was sequestered on eroded lands by mid-2013. However, there was perhaps inadequate stakeholder consultation/adaptation to local conditions in the design of the activities, calling into question the longer-term sustainability of gains achieved (IEG). A follow-on Environmental Services Project (FY15) has been designed to build on the successes and address the shortcomings with respect to increasing local engagement in the design and management of community activities and resources, which should help sustain the gains made. Of the 4 results included in this area, 3 pertaining to income generation targets, reduction in erosion and restructuring of forestry extension services were all achieved. The 4th indicator was mostly achieved, with carbon sequestration in mid 2013 reaching close to 130,000 tons, versus a target of 181,000 tons for end- 2014 (not verified). 25. Efforts to improve water resource management at the national and cross-border (with Montenegro) levels were much less successful. A cross-border commission was established with Bank support to manage Lake Shkodra on the Albania-Montenegro border. However, it proved to be unsustainable as neither Government provided the staffing and other resources necessary to carry out operations once the Bank project ended. Capacity building for the National Water Council and various stakeholders at national and regional levels had not begun as intended in the results matrix. This delay was related to the slow start-up and implementation of the Water Resources Improvement Project approved in FY13. 26. With regard to municipal level solid waste and wastewater disposal, CPS results indicators, mainly linked to the Bank-financed Integrated Coastal Zone Management and Clean-up Project (ICZMP) included true outcome indicators with defined baselines and targets for waste disposal. However, given extension of CLR Review For Official Use Only Independent Evaluation Group 9 the ICZMP beyond the CPS period, results had yet to be measured at the time the CLR was written. Based on the milestones related to these outcome indicators, progress appears to have been good and it is likely that most outcomes will be achieved, albeit with considerable lag. Particularly noteworthy was the successful remediation of the contaminated site of Porto Romano and the completion of extensions to the sewage network in Saranda. However, construction of landfill and transfer centers was still underway at end-CPS. While the milestone of developing and adopting an EU compliant management plan for Butrint National Park and wetlands was achieved in 2011, the CLR fails to report on its implementation in subsequent years of the CPS period. IFC activities in this area were limited to preparation of a PPP transaction aimed at assistance to the Municipality of Tirana with selecting a private sector investor who will manage the waste collection and disposal for the entire Tirana Municipality. The project has been put on hold because the Ministry of Finance did not approve the project’s feasibility study which did not align with the government’s country wide waste sector master plan. 27. IEG rates the overall performance of Pillar 3 as Moderately Unsatisfactory. The most positive aspect was the positive experience in community level environmental services and income generation and the innovative (successful) effort to sequester carbon on eroded lands. By contrast, the least successful aspect was the initiative to develop a cross-border management authority for Lake Shkodra, which clearly lacked governmental commitment on both sides of the border and was therefore unsustainable. Institution building is an inherently difficult task and creating a new institution to operate across borders is especially challenging. As the Bank is increasingly involved in supporting cross-border interventions, the CLR might usefully have reflected further on the issues encountered and lessons for future cooperation across countries, in the Balkans and elsewhere. The delays in implementation of the ICZMP, due in part to past problems with social safeguards issues, also means that several results indicators related to the project were not achieved by the end of the CPS period. Of the 10 milestones included for this Pillar 3 were achieved with the remainder partially achieved (4) or not achieved (3). Overall Assessment and Rating 28. IEG rates the overall development outcomes of the WBG support as Moderately Satisfactory, a rating that coincides with the Country Team’s own rating in the CLR. The WBG strategy for Albania had positive, but mixed, results overall and a number of outcomes were significantly affected by implementation delays (e.g., municipal waste management) and weak Government commitment (e.g., fiscal reform). With hindsight, it seems clear that the WBG program was too wide-ranging and that stronger efforts should have been made at the outset to consolidate and focus the Bank’s areas of engagement in Albania. Some outcomes were clearly also affected by exogenous factors beyond the country’s or WBG’s control. For example, the outcome related to acceleration of growth was affected negatively by the continued economic stagnation in the EU. On the other hand, CPS interventions likely helped to address vulnerabilities in the financial sector and, hence, to contain potential spillovers from the Eurozone difficulties. Moreover, fiscal issues began to be addressed more systematically by the new administration in the final year of the CPS. In this regard, improvements in public financial management and a major reform of the pension system are especially noteworthy. The weakest performance of the CPS was in the energy sector, which as discussed above, not only did not meet CPS goals in terms of power generation, but actually saw a reversal of past advances in efforts to increase the efficiency of distribution. Moreover, problems with cost recovery and electricity theft continue unchecked, with repercussions for ongoing efforts to achieve fiscal consolidation. Important gains were also made with regard to health and (to a lesser extent) secondary and higher education and in the provision of social assistance to people with disabilities and the lowest income households. While environmental conservation through community involvement was largely successful in raising incomes and reducing erosion, there was significant doubt about sustainability. Similarly, efforts to strengthen institutions for management of water resources at national and cross-border levels were too slow and, in the latter case, were unsustainable once Bank support was withdrawn. CLR Review For Official Use Only Independent Evaluation Group 10 Objectives IEG Rating Pillar 1: Growth and Competitiveness Moderately Satisfactory Pillar 2: Broadening/Sustaining Social Gains Moderately Satisfactory Pillar 3: Reducing Albania’s vulnerability to Climate Moderately Unsatisfactory Change 6. WBG Performance 29. Selectivity. The CPS program was grounded in Albania’s NSDI and the Government EAOD and clearly linked to the priorities identified in those documents. The CPS focus on the economic and social, rather than the political economy emphases (democratization, judicial reform) of the NSDI was also appropriate, given the greater comparative advantage of the EU and European bilateral donors with respect to the latter. Overall, the areas selected for WBG interventions played to the organization’s strengths – either by seeking to exploit complementarities between the Bank and IFC (e.g., energy and PSD) or in terms of previous WBG experience in Albania or similar countries. The CPS strategy was also based on a solid foundation of analytical work, including core diagnostic reports as well as sector studies that shaped specific interventions. 30. However, the FY11-14 CPS and the associated results matrix reflect an overly broad program with a large number of planned outcomes and milestones. In part, this was a legacy issue. The CPS was developed at a time when the Bank already had a very wide-ranging program on the ground, with few sectors left untouched. At the time of the Board presentation of the CPS, the Bank’s portfolio included around US$480 million in commitments, including $263 million in IBRD/IDA loans and credits for 15 projects, about US$180 million in co-financing from other donors (of which a large part was devoted to the Integrated Planning System project) and about $35 million in recipient-executed trust funds supervised by the Bank. As most, if not all, IBRD/IDA projects and the IPS project were expected to close during the CPS implementation period, the CPS matrix attempted to give each of these operations its due by including outcomes and indicators relating to it. Thus despite the Bank’s and Government’s clearly stated intention of being more selective for the FY11-14 CPS, the results matrix remained extensive and complex. Even after making some allowance for the “legacy factor”, the original CPS program was clearly too wide-ranging and complex -- especially in relation to the relatively small initial resource envelope of US$275 million. The CPS proposed 12 new Bank operations, including 8 investment operations and 4 DPLs, implying an average size of under $23 million each. The CPS did include a caveat indicating that the number of projects and the pace of their preparation would be closely linked to improved performance of the existing portfolio and actual project closings – thus building in considerable flexibility for FYs13 and 14. 31. In fact, the total number of operations approved during the CPS period was 8 versus the 12 planned in the CPS, with most approvals occurring in the last year of the CPS, following election of a new Government with a stronger commitment to reform. This, together with an increase in the lending envelope for Albania and the Bank’s close attention to accelerating the implementation of the legacy portfolio, meant that there was significant consolidation of the Bank program over the CPS period with the number of active operations dropping from 15 to 6 and their average size increasing from $18 million to $47 million. In turn, this should position the WBG for a well-focused and selective program in the FY15-18 CPF. 32. Alignment. Although the Bank had not articulated the corporate twin goals at the time this CPS was prepared, its objectives, design and actual program were generally consistent with these corporate priorities. At the most direct level, the efforts to strengthen the conditional cash transfer and disability programs were aimed at protecting the poorest groups, and investments in primary health care and education (though more broadly targeted) were likely to be of most benefit for the lower income quintiles, who have few, if any, alternatives to the public systems. Similarly, the focus on community income generation through environmental service initiatives as well as actions to reduce flooding and other disasters were designed to benefit poorer, more vulnerable, rural households. In terms of shared prosperity as well, the CPS objectives CLR Review For Official Use Only Independent Evaluation Group 11 and programs (especially Strategic Objective 1), with their focus on macroeconomic management/stability and growth were fully relevant. As highlighted in the CLR and Strategic Country Diagnostic (SCD) for Albania, rapid growth was the key determinant in poverty reduction in the pre-crisis period, with consumption of the bottom 40% of the population growing faster than the average. The growth slowdown following the crisis led to some reversal in the pre-crisis gains in poverty reduction, again establishing the strong link between growth and poverty. In this context, the CPS program’s focus on supporting efforts to accelerate growth, would, if successful, have helped to further the twin goals. 33. While the strategy was in substance well aligned with the twin goals, the links between CPS activities (including growth-supporting activities), poverty reduction and shared prosperity were not well articulated either in the CPS document or the results matrix. The only outcome for which poverty reduction is directly mentioned is the outcome associated with revamping of the disability and conditional cash transfers. It is also alluded to in the indicator on community-based mini-catchment management plans, which involves measures of increased incomes for rural households through communal forestry and agricultural activities. There is also no evidence presented to suggest that program changes made during the course of CPS implementation were designed to sharpen the impact of projects or analytical work towards furthering the twin goals. Lending and Investments 34. Actual lending over the CPS period differed significantly from the original plan in terms of number of operations as well as their composition, timing and size. As noted in the CLR, the lending envelope allocated for Albania more than doubled in size from $275 million in the CPS to $575 million by the CPS PR, as the Bank stepped up support to Albania to address flooding emergencies and increase resilience to the prolonged Eurozone crisis. Actual lending over the four years of the CPS was about $441 million, with most lending ($305 million) occurring in the last year of the CPS following the change of administration. Of the total lending, about 55% was in the form of quick-disbursing DPLs and the remainder was allocated for investment operations. A significant change in program composition was the decision to drop the planned Growth DPL series, given an inadequate macroeconomic framework to permit budget support. On the other hand, a one-off Financial Sector DPL and the first of a new Public Finance DPL series were prepared and disbursed in the final year of the CPS. A number of investment projects were also dropped or postponed to the next CPS period, including, inter alia, a proposed Health Project, an Energy Sector Reform and Recovery Project, a Road Safety and Maintenance Project. The total number of new operations was 8, about half the number delivered over the previous CPS period. New lending comprised a DPL (US$25 mill) and investment operation for modernizing social assistance (US$40 mill), additional financing for dam safety (US$21 mill), a water and irrigation project (US$40 mill), a water sector investment project (US$85.3 mill) an environmental services project (US$10 mill), as well as DPLs for the financial sector (US$100 mill) and public finance (US$120 mill). 35. The CPS period saw significant acceleration in implementation and disbursements over the CPS period, in line with the CPS goal. There were 15 projects (average size US$18 million) in the portfolio at the beginning of the CPS, many of which were over-aged. At the end of FY14, there were 6 projects in the portfolio with an average size of US$47 million. 36. When the CPS was presented in June 2010 IFC envisaged increasing its financing to the private sector in Albania to a level of $120 - $150 million through “direct financing” in key sectors including agribusiness, energy and social sectors. The financial sector investments were supposed to strengthen banks’ capitalization and provide long-term finance for MSMEs, renewable energy and energy efficient products. The target has been met with $134 million disbursement from IFC own account and $47 million syndicated/parallel loans. Total loan commitment amounted to $155 million and there was also an equity commitment of $15 million. IFC commitments were heavily skewed to the energy sector for which $154 million were committed, or 90% of the total. The energy commitments were equally split between the electricity sector (three new projects) and oil (one new project and one approved in 2009, and active during the report period). The financial sector was the third in importance in IFC commitments with one investment of $12 million (or only 7% of total) in a commercial bank, not a strong support during the Eurozone crises CLR Review For Official Use Only Independent Evaluation Group 12 which affected Albania. In contrast with IFC practices in neighboring countries where it actively used its revolving short-term guarantees under the Global Trade Finance Program, only two such guarantees were issued in Albania for less than $2.7 million. Contrary to the CPS plans no investment commitment was recorded either in agribusiness or in any social sector. Some activity happened with IFC investments in the cement industry, which for some reason was classified in the MIS as “a consumer and social service”. During the CPS period IFC started nine investment projects in Albania. One more project (in oil) was a carry- over from the previous CPS period. There were seven more projects with investments outstanding, but with no activity during FY11 – FY14. 37. In the absence of IEG ratings, success of IFC investment projects in Albania could be measured only on the basis of IFC self-evaluations of their 14 investment partners in DOTS. Projects were found mostly successful with only 3 partners (a total of six projects), seven were self-evaluated as unsuccessful, three – “too early to tell”, and two unrated. The success rate of IFC investment projects in Albania was 33%. 38. Analytic and Advisory Activities and Services. The Bank undertook a number of high profile and high quality analytical reports and AAA, using both Bank budget resources and in several instances combining these well with donor funding from trust fund and other sources. Of particular note were the Public Finance Review and a related TA on Public Financial Management Strategy, which were both instrumental in generating commitment to reforms among a wide range of stakeholders across the political spectrum, civil society and the private sector. Similarly, analytical work and TA in the pension reform area were crucial to the passage of a far-reaching pension reform, which should help maintain the longer-term sustainability of the system. In addition, the Policy Notes were an important factor in establishing a strong dialogue with the new Administration. Much of the impact of the Notes was derived from the strong stakeholder consultations and dialogue that accompanied their preparation and dissemination. For the most part, the AAA plan laid out in the CPS was delivered and a number of major products were added, including a CEM, Debt Management Assessment, a TA activity for Financial Sector Contingency planning, a study on Pro-poor Electricity and Water among many others. Several of these additional reports were important inputs in designing Albania’s response to the Eurozone developments and/or the basis for building stakeholder consensus on the way forward. Moreover, the analytical work and TA activities were often the basis for donor coordination in lending/grant operations. Several AAA activities were undertaken with support from bilateral donors or from dedicated regional TFs managed by the Bank. 39. IFC had 15 active advisory services in Albania during the CPS period, four of which predated the CPS. The total funds allocated to these advisory projects exceeded $17.3 million, albeit six projects were regional in scope (ECA, SEE, or Western Balkans) and activities in Albania made up only a portion of their budgets. IEG evaluated one advisory project in Albania (International Standards and Technical Regulations) and found it mostly successful in development effectiveness with excellent outputs, satisfactory strategic relevance and outcome achievements, but could not verify its impact contrary to IFC self-assessment as satisfactory. The other project from the previous CPS period evaluated by IEG in 2012 dealt with alternative dispute resolution (ADR) and IEG agreed with IFC self-evaluated successful rating, satisfactory development effectiveness, strategic relevance, and outcome and impact achievements. One project was closed with self- evaluated successful development effectiveness and satisfactory results, one was terminated a year after approval. Of the on-going AS projects, supervision reports showed excellent development effectiveness in 2 projects, 7 were on track with satisfactory results, two were put on hold due to client’s lack of readiness, and the remaining 2 projects were just started in FY14. 40. Results Framework. As discussed in other sections, the CPS results framework was well aligned with national development goals and the outcome indicators were, in turn, reasonably well aligned with the objectives. With some exceptions, the causal chain between at least Bank-supported interventions and expected CPS outcomes was relatively well designed using a combination of outcome-oriented and output- oriented indicators or milestones. The framework does, however, suffer from a number of weaknesses. First, the scope of the framework and the multiplicity of indicators not only diffused the focus of the Bank’s work, but the high degree of complexity meant that the outcomes were often not adequately monitored during CPS implementation. Second, the results framework made little effort to draw out links to poverty reduction CLR Review For Official Use Only Independent Evaluation Group 13 and virtually no effort to explicitly factor in gender considerations. Third, except in a few instances such as road transport and health, the results matrix did not adequately specify baseline measures of performance or measure and report on quantitative outcomes. If, as the CLR indicates in para 26, this was a matter of “choice” rather than oversight, much more justification for this unusual “choice” should have been provided. Finally, and perhaps most importantly, the framework as laid out in the CPS and CPS PR as well as reviewed in the CLR, does not bear out the commitment in the strategy to a “one Bank” approach, even in sectors such as energy or PSD, where there was, in fact, a plethora of potentially complementary and even joint activities. 41. The CPS results framework suffered from poorly structured results chains for IFC projects. It was hard to establish a link between some IFC activities and the CPS objectives that they were supposed to influence: e.g. ECA Debt Resolution project which is focused on improvement of firms’ insolvency regulations and practices was to contribute to the Outcome 1 of CPS “improved credibility and contestability of fiscal policy”. . 42. Partnerships and Development Partner Coordination. Implementation of the Albania CPS included several examples of excellent cooperation between the Bank and other development partners. In part, this may be attributable to the decision by Government to create a special unit to help coordinate donor activities and the production of the EAOD to help orient external assistance. Throughout CPS implementation, the Bank regularly engaged with other donors through a monthly coordination forum as well as participated in sectoral donor meetings led by Government in areas of Bank engagement. The EEEP and the IPS were both good examples of donors coming together to address priority needs. The EEEP was the first sector-wide operation in Albania and its lessons should perhaps have been examined in greater depth in the CLR, including any areas of disagreement between the Bank and some donors that arose during the implementations phase and how these were resolved. IPS collaboration was generally successful as evidenced by most donors involved to participate in a follow-on IPS 2 operation. IFC cooperated with EBRD in renewable energy, and with Austrian Development Agency in tax simplification. 43. Safeguards and Fiduciary Issues. In Albania, seven projects triggered one or multiple safeguards, including four category “A” projects and three category “B” projects. In the transport sector, World Bank support for secondary and local roads reconstruction, road maintenance and safety triggered multiple safeguards, which were satisfactorily complied with. Environmental safeguards were triggered and were fully complied with in the agriculture sector. However, safeguards issues surrounding land rights and ownership affected the implementation of education projects during the CPS implementation period. The Education Excellence and Equity Project experienced significant delays in at least one school construction component as a result of challenges by a local resident. Similarly, the Integrated Coastal Zone Management and Clean- up Project was affected by the lack of clarity surrounding the rights of squatters on public lands in terms of resettlement and compensation. Going forward, much more attention to lands rights issues needs to be paid in the project preparation phase to avoid disputes, delays and associated reputational risks to the Bank during implementation. In addition, the Power Generation and Restructuring project triggered an inspection panel case. The Panel concluded that the Bank Management was correct in its determination that the Bank Policy 4.04 on Natural Habitats was not triggered by the project, but the Project preparation and appraisal activities were in non-compliance with other Bank Policies (including OP/BP 4.01). The Inspection Panel’s Progress Report in 2010 noted good progress by the Bank’s Management in all key areas requiring action according to the earlier report. No information on fiduciary issues/complaints to IEG is included in the CLR. 44. Ownership and Flexibility. As previously noted, the CPS program was fully responsive to the NSDI, a document that was developed through a broad consultation process involving a wide range of stakeholders. In this sense, it is safe to say that Albanian ownership of the CPS program was adequate. However, subsequent Government reluctance to implement fiscal consolidation measures close to the upcoming national elections suggests that the Bank may initially have underestimated political economy considerations. The Bank’s follow-up to this situation, involving high quality analytical work and broad and politically even-handed dissemination/consultation of findings, was excellent and likely helped move forward an ambitious agenda following installation of the new administration in 2013. CLR Review For Official Use Only Independent Evaluation Group 14 45. The Bank displayed considerable flexibility and responsiveness during CPS program implementation in response to unfavorable external and internal events. First, the continuing crisis in the Eurozone (and its serious implications for growth and poverty reduction in Albania) induced the Bank to double its original envelope for Albania and provided impetus to sharpen the CPS program’s focus on macroeconomic, financial sector and energy sector vulnerabilities. Second, an additional $25 million was provided to help Albania address the 2010 catastrophic flooding events and improve the safety of major dams. Third, an EU decision to grant Albania candidate status provided it could demonstrate clear improvements in public administration led to requests by Government to increase Bank support in this area, to which the Bank responded in a positive and timely manner. Fourth, the Bank included a much greater focus on the financial sector as an important element in bolstering Albania’s macro and financial stability. Fifth, the Bank appropriately held back DPL lending in the absence of political commitment to fiscal consolidation until prospects for a more sustainable macro framework improved under a new administration. Similarly, the Bank and Government did not push ahead with new investment lending in areas where existing projects were experiencing implementation problems or delays. These latter two factors, however, meant the CPS program became back-loaded with many operations pushed either to the last year of the CPS period or to the next CPS. 46. WBG Internal Cooperation. Internal cooperation between the Bank and IFC is perhaps one of the weakest areas of Bank Group performance for this CPS, at least with respect to cooperation in defining/measuring outcomes in the results framework and in reporting in the CLR. While interviews with staff suggest that the IFC and Bank did in fact cooperate or at least exchange information in a number of areas to ensure complementarity as envisaged in the CPS, there is virtually no evidence of this in the CLR documentation. There is also no evidence of how any potential or actual conflicts of interest were addressed as there must have been on energy distribution, where the Bank was working closely with the Government and public sector authorities while IFC was first and foremost closely linked to the private concessionaire for distribution, which was an IFC client. In fact, as noted above in para 36, IFC operations were not even included in the results framework at the CPS PR stage, when IFC operations were likely much better defined. 47. Risk Identification and Mitigation. IEG agrees with the CLR’s view that the identification of risks – including external Eurozone and climatic risks as well as domestic risks of slow implementation and resistance to fiscal reform – was candid and correct. Mitigation measures were appropriate including slowdown in the approval of new investment operations in the event of implementation risks and wide stakeholder dialogue to mitigate policy risks. As already mentioned, the Bank did in fact undertake high quality AAA and disseminate it widely through the Policy Notes exercise to successfully refocus stakeholder attention on key fiscal, pension reform and other lagging policy issues. The Bank also helped to mitigate some policy risks through the introduction of high quality advisory projects, often coordinated with other donors. Intensive supervision support including monthly portfolio meetings with Government and training for project staff in procurement and financial management helped accelerate portfolio implementation. An additional mitigation measure (not originally mentioned in the CPS) were the decisions by the Bank to allocate additional funds to Albania in response to the 2010 flooding emergency and to help bolster Albania’s resilience to the deepening Eurozone crisis through doubling the original CPS envelope and increasing focus on financial sector strengthening, including a DPL for $100 million. 48. Overall Assessment and Rating of WBG Performance. IEG concurs with the CLR self-rating of the Bank’s performance as good. In terms of the design of the CPS program, there were several positive factors, particularly the close alignment of the CPS program with the NSDI, the consideration of Bank comparative advantage in the selection of areas for engagement, the strong links between planned AAA and lending, a candid assessment of risks and mitigation measures and adequate consideration of partnership and stakeholder priorities. However, there were clear problems with selectivity (even considering the “legacy” portfolio), an unwieldy and not very well designed results matrix with inadequate attention to measurable outcomes, and inadequately specified modalities for cooperation between the Bank and IFC. As noted earlier, selectivity improved over the course of CPS implementation due, inter alia, to the Bank’s consistent adherence to the CPS priority of improving implementation of the existing portfolio (including strengthening country procurement and financial management systems) before embarking on new investment operations. Also noteworthy was the decision to defer the DPL series until there was strong CLR Review For Official Use Only Independent Evaluation Group 15 internal commitment to fiscal reform and other critical reform measures. In this regard the Bank deserves credit for continuing to work diligently with key external partners to deliver high quality AAA to support the reform process and build consensus among domestic stakeholders for critical reforms throughout FYs11-13, thereby enabling progress on key reform measures with (fiscal consolidation, pensions, energy and financial sector) to enable implementation of DPLs by FY14. In addition it is worth re-emphasizing the appropriate flexibility shown by the Bank in increasing allocations to Albania to address unfavorable exogenous shocks, enabling a higher level of resource transfer than was originally anticipated, while still maintaining attention to the medium-term development agenda. 7. Assessment of CLR Completion Report 49. CLR Assessment. The CLR Completion Report discusses the results of the CPS assistance at two levels: in the main text and Attachment 1. The text describes the main actions taken and presents a general overview of results. Attachment 1 follows the CPSPR results framework and discusses the results of the assistance by looking mostly at actions taken and outputs rather than outcomes. Thus while the CLR is consistent with the CPS/CPS PR objectives and the associated results framework a discussion of impact is only apparent in a couple of areas such as road transport, reflecting the indicators included. Moreover, as highlighted throughout this report, the CLR includes little meaningful discussion of IFC activities, either in terms of indicators nor text discussion of how synergies were or were not exploited and what lessons were learned. There is also very little discussion of safeguards issues except a reference to the potential use of the national e-procurement system for selected Bank projects and some mention of the role of social safeguards (land disputes) in delaying school construction under the EEEP. Despite the shortcomings of the CPS results matrix (matrices), the CLR could have included an effort to assess outcomes, especially in areas where the desired output was reached some years ago. This effort was not made, implying that there is very little measurement of impact. 8. Findings and Lessons 50. The CLR includes about 9 lessons covering, inter alia, maintenance of continuous dialogue with Government and stakeholders, calibration of new lending to reform and institutional capacity, simplifying the results matrix, importance of AAA, supporting PSD through appropriate regulation, adaptation to local conditions, close coordination with external development partners and prioritizing the consolidation of the existing portfolio. These lessons are all useful and appropriate. IEG would like to highlight the following lessons which emerge clearly from the Albania FY11-14 experience: (i) in the event of low political comment to the reform agenda in high development priority areas, it is critical to build a broad coalition of support for reform in an open and transparent manner through high quality AAA and discussions with national stakeholders and international development partners to build a shared understanding of the stakes involved and leverage action; (ii) selectivity in strategy design is imperative in relatively low capacity countries such as Albania, especially when the Bank has a limited resource envelope -- the process of clearly specifying desired outcomes is an important support to achieving a selective CPS program, even when there are multiple needs; (iii) Bank/IFC synergy can add significant value but only when it is consciously planned for, potential conflicts of interest are identified and discussed up front and modalities are identified for addressing such conflicts when they arise; and (iv) in cases where there is already a scattered program of small operations it is vital to restructure the portfolio and accelerate implementation before embarking on new lending. CLR Review Annexes Independent Evaluation Group 17 Annex Table 1: Summary Achievements of CPS Objectives Annex Table 2: Planned and Actual Lending for Albania, FY11-14 Annex Table 3: Analytical and Advisory Work for Albania, FY11 - FY14 Annex Table 4: Grants and Trust Funds Active in FY11-14 for Albania (in US$ million) Annex Table 5: IEG Project Ratings for Albania, FY11-Present Annex Table 6: IEG Project Ratings for Albania and Comparators, FY11- 14 Annex Table 7: Portfolio Status for Albania and Comparators, FY11-14 Annex Table 8: Disbursement Ratio for Albania, FY11-13 Annex Table 9A: List of IFC Investments Committed in FY11-FY14 Annex Table 9B: Investments Committed pre-FY11 but active during FY11-14 Annex Table 10A: List of IFC Advisory Services Approved in FY11-14 Annex Table 10B: Advisory Services Approved pre-FY11 but active during FY11-14 Annex Table 11: Net Disbursement and Charges for Albania, FY11-14 Annex Table 12: Total Net Disbursements of Official Development Assistance and Official Aid for Albania Annex Table 13: Economic and Social Indicators for Albania, 2011 – 2013 Annexes CLR Review 19 Independent Evaluation Group Annex Table 1: Summary of Achievements of CPS Objectives CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness Results Area: Sound macroeconomic management and improved public expenditure management 1. CPS Objective: Improve credibility and contestability of fiscal policy, strengthen financial stability, national economic statistics, and reporting on development outcomes and governance of public spending Indicator: Automated treasury The Treasury system is fully functional in its Source: CLR system fully implemented basic form. Enhancements are being made to across and used by all central address limitations in functionality, for This was introduced at the Government ministries and example, in terms of commitment controls and CPSPR stage (April 2013) as agencies for payments, recording of multi-year obligations. a milestone to measure receipts, commitments and progress towards the asset management achievement of the objective. Baseline: No Target: Yes Indicator: Detailed and Detailed and consolidated in-year budget Source: CLR consolidated government in- execution reports and reports on customs, tax year budget execution reports revenues, and VAT reimbursements are This was introduced at the published monthly on-line by published online. CPSPR stage (April 2013) as 2012 a milestone to measure progress towards the Baseline: No achievement of the objective. Major Target: Yes Outcome Indicator: All Bank-financed All Bank financed projects are fully budgeted in Source: CLR Measures projects budgeted fully in the the MTBP (except some stand-alone grants). MTBP, using Treasury System The Albanian Government Financial This was introduced at the for financial management, and Information System (GFIS, treasury) has been CPSPR stage (April 2013) as reported on in government used in three projects for the funds flow. a milestone to measure financial reports Despite improvements in the system, progress towards the weaknesses were noted when used for project achievement of the objective. Baseline: No purposes. Target: Yes Indicator: Fully functional EU- The procurement complaints review Source: CLR compliant procurement mechanism in place is close to being fully EU complaints review mechanism complaint. The Public Procurement This was introduced at the in place. Commission has been established by the CPSPR stage (April 2013) as Public Procurement Law as the highest body in a milestone to measure Baseline: No the procurement system. It provides legal progress towards the protection for tenderers and the public interest achievement of the objective. Target: Yes at all stages of the public procurement process, concessions, auctions, and licensing of mines. Indicator: E-procurement The e-Government Procurement (e-GP) Source: CLR system certified for use by system was assessed by a consulting firm some donor-financed projects, hired by the Bank in 2010: the Bank can use This was introduced at the including World Bank the system (only for ICB and NCB procedures). CPSPR stage (April 2013) as a milestone to measure Annexes CLR Review 20 Independent Evaluation Group CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness Baseline: No The system has been piloted successfully progress towards the under the Secondary and Local Roads Project. achievement of the objective. Target: Yes Indicator: A back-stop facility The Albania Deposit Insurance Authority Source: CLR with the MoF for the Deposit (ADIA) has secured a back-stop funding facility Insurance Authority established. from the EBRD for €100 million to be called This was introduced at the upon if needed to fulfill ADIA’s obligations to CPSPR stage (April 2013) as Baseline: No insured depositors. a milestone to measure progress towards the Target: Yes achievement of the objective. Indicator: Foreign bank Foreign bank branches, which retain capital in Source: CLR branches, which retain capital in country, were converted into subsidiaries in country, are converted into 2012. This was introduced at the subsidiaries CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Results Area: Improving business regulations and reducing compliance costs for the private sector 2. CPS Objective: Increase satisfaction with quality of regulations Indicator: Satisfaction with As of 2012, the satisfaction with the quality of Source: CLR, BEEPS and quality of regulations (1=very regulations was 2.5. Customized Survey satisfied; 6=very dissatisfied). This outcome indicator was Baseline: 3.3 (2005) introduced at the CPSPR stage (April 2013). The target Target: 2.5 (2012) had already been in achieved by 2012. Indicator: Regulatory As of 2012, the inspection system had been Source: CLR framework for business revised and General Directorate of Inspection inspections revised and established. The system is being used beyond This was introduced at the adopted. the BERIS project and across the country. CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Indicator: Number of As of 2012, 175 government officials were Source: CLR government officials trained in trained in regulatory review techniques. techniques for regulatory review This was introduced at the CPSPR stage (April 2013) as Baseline: 3 in 2008 a milestone to measure progress towards the Target: 175 in 2011 achievement of the objective. 3. CPS Objective: Reduce time for registering immovable property transactions Indicator: Number of days As of 2012, days needed for registering Source: CLR needed for registering immovable property transactions was 9.8 days. immovable property This outcome indicator was transactions introduced at the CPSPR stage (April 2013). The target Baseline: 30 (2009) had already been in achieved by 2012. Target: 10 (2012) Annexes CLR Review 21 Independent Evaluation Group CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness Indicator: Development of land The National Property Rights Strategy was Source: CLR and property rights regime. adopted (2012), as well as the new Law on Immovable Property Registration (2013). This was introduced at the Baseline: No However, a reasonable solution to restitution / CPSPR stage (April 2013) as compensation policy and institutional a milestone to measure Target: Yes coordination for property rights needs further progress towards the attention. achievement of the objective. Indicator: Complete LAMP supported the development of new Source: CLR computerization of Tirana front/back office functions, IT system, and roll Immovable Property out to 10 largest registration offices, including This was introduced at the Registration Office Tirana. CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes 4. CPS Objective: Improve private sector compliance with selected EU and international requirements particularly with respect to: (i) accounting and auditing standards; (ii) compliance with EU standards for exports; and (iii) issuance of environmental permits. Indicator: By-laws and Through the dedicated TA support under Source: CLR regulations developed for an REPARIS program, the Audit Oversight audit oversight system in line System now has by-laws and toolkits in line This was introduced at the with EU directives. with best international practices and EU CPSPR stage (April 2013) as directives. a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Indicator: EU-compliant An EU-compliant National Metrology Source: CLR National Metrology Laboratory Laboratory fitted with equipment became fully fully operational. operational from January 2013. This was introduced at the CPSPR stage (April 2013) as Baseline: No a milestone to measure progress towards the Target: Yes achievement of the objective. Indicator: National Accounting With TA support through the REPARIS Source: CLR Council regularly publishes program, the National Accounting Council updated International Financial (NAC) has upgraded its ability to update and This was introduced at the Reporting Standards publish IFRS translations. NAC now has clear CPSPR stage (April 2013) as and detailed procedures for standard-setting a milestone to measure Baseline: No and has acquired translation software. Staff progress towards the has been extensively trained. A consolidated achievement of the objective. Target: Yes version of updated IFRS was published in 2013. Indicator: On-line database on The CLR reports that the indicator was met. Source: CLR environmental permit applications in place by Dec This was introduced at the 2012. CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Annexes CLR Review 22 Independent Evaluation Group CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness Indicator: Number of At least 250 individuals/ organizations were Source: CLR individuals and organizations trained in AaC principles by 2012. trained in AaC principles This was introduced at the CPSPR stage (April 2013) as Baseline: 0 in 2010 a milestone to measure progress towards the Target: 250 in 2012 achievement of the objective. Results Area: Improved, and more financially sustainable, infrastructure services in roads, energy, and irrigation 5. CPS Objective: Improve domestic energy supply (800 gigawatt of additional power supply per year), transmissions system operation, safety and operational efficiency of hydropower dams Indicator: Increased and Power supply improved over the last five Source: CLR diversified capacity to generate years: net supply increased yearly by 330 electricity of 700 GWh per GWh (5%) and reached 7,960 GWh in 2013. annum Baseline: No Target: Yes Indicator: Complete Construction of Vlore TPP was completed in Source: CLR construction and initiate December 2011; however, it is not operational commercial operations of Vlore because the contractor did not properly This was introduced at the Thermal Power Plant remedy failures at the offshore facilities. An CPSPR stage (April 2013) as independent assessment was carried out by a milestone to measure Baseline: No the Bank and presented to KESH. The report progress towards the has provided KESH with a basis for moving achievement of the objective. Target: Yes forward in implementing a permanent solution to the problem which would ensure consistent, reliable and sustainable operation of the power plant. The additional installed thermal capacity of 97 MW is not yet completed. Indicator: Rehabilitation of Five regional substations (Tirana, Elbasan1, Source: CLR three substations completed. Elbasan2, Burrel, and Fieri) were fully refurbished and rehabilitated. New control and This was introduced at the Baseline: No monitoring systems were installed in three CPSPR stage (April 2013) as other substations in VDeja, Komani, and a milestone to measure Target: Yes Fierza. The reliability of transmission system is progress towards the significantly improved and estimated at 99%. achievement of the objective. Indicator: Complete The transmission system operator (OST sha) Source: CLR restructuring of Transmission restructuring is completed based on the actual System Operator and business Albanian Market Model. The tariffs for This was introduced at the plan including new tariffs transmission activity are approved yearly. The CPSPR stage (April 2013) as approved. new tariff structure needs to be adopted and a milestone to measure approved reflecting new market developments progress towards the Baseline: No and requirements of the SEE Energy achievement of the objective. Community Treaty. Target: Yes Indicator: Remedial measures The Dam Safety Project is under Source: CLR of high and medium priority implementation. The dam infrastructure and targeting spillways and other systems are improved. The facilities of the This was introduced at the dam infrastructure completed. major hydroelectric dams in Albania affected CPSPR stage (April 2013) as a milestone to measure Annexes CLR Review 23 Independent Evaluation Group CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness Baseline: No by the safeguard measures are increased by progress towards the 20%. achievement of the objective. Target: Yes 6. CPS Objective: Improve cost recovery within the electricity distribution system. Indicator: Timely tariff The generation, transmission, distribution and Source: CLR adjustments approved for retail tariffs are not adjusted timely and Distribution System Operator remained unchanged during the last five years. This was introduced at the and Retail Public Supplier in Since December 2009, the electricity tariffs CPSPR stage (April 2013) as conformity with the agreed have not been revised and the Regulatory a milestone to measure Regulatory Statement. Statement was not suitably implemented. The progress towards the Energy Regulatory Authority (ERE) delayed achievement of the objective. Baseline: No acceptance of level of losses and bad debts after those were assessed by independent Target: Yes auditors; also 2012 tariffs were not adjusted to allow for higher level of bad debts. Indicator: Financial Recovery No Financial Recovery Plan was prepared and Source: CLR program in the Sector, to allow approved. Over the past year, the sector has KESH to clear its arrears to evolved into a state of financial and This was introduced at the suppliers. performance crises, presenting major fiscal, CPSPR stage (April 2013) as growth, and supply security risks. The entire a milestone to measure Baseline: No sector has been negatively impacted and progress towards the continues to sustain significant damage due to achievement of the objective. Target: Yes high energy losses and poor revenue collections. Moreover, bill collections from budgetary and non-budgetary institutions did not improve. 7. CPS Objective: Promote energy efficiency and use of cleaner energy (progress will be measured by the number of projects signed: base: 0 in 2010; target: 5 in 2013) Indicator: Cooperation The absence of legal and regulatory Source: CLR Agreements signed with five frameworks for implementing energy efficiency banks to implement the initiatives hampered progress. This was introduced at the Residential Energy Efficiency CPSPR stage (April 2013) as program. a milestone to measure progress towards the Baseline: No achievement of the objective. Target: Yes Indicator: Revised step-in The step-in right was adopted in the Source: CLR rights law encourages banks to concession law. This provision has increased finance Small Hydro Power the requirement for concession and This was introduced at the Plants (SHPPs). commercial bank participation in financing of CPSPR stage (April 2013) as renewable activities. The new additional hydro a milestone to measure Baseline: No capacity constructed by the Independent progress towards the Power Producers (IPPs) resulted in total achievement of the objective. Target: Yes additional capacity by end-2013 to 230 MW. Apart from the Drin River Cascade (state owned with 1,350 MW and average production of GWh 4,000 per year), there are other existing privatized hydropower plants and many new hydro capacity contracted during the last four years. The Independent Power Producers, by the end of 2013, operated 308 Annexes CLR Review 24 Independent Evaluation Group CPS FY11-FY14: Pillar I Accelerating the recovery in Actual Results Albania’s economic growth Comments (as of current month/year) through improved competitiveness MW hydro-capacities with an annual production of 1,250 GWh. 8. CPS Objective: Improve road conditions and sustainability of roads investments Indicator: Number of The original target (estimated) under SLRP Source: CLR communities with improved was 50 communities, and by the end of the road access to services and project the number of communities which are markets accessed by and using the improved roads stood at 86. Baseline: 0 (2010) Target: 26 (2012) Indicator: Share of regional A major investment program to improve the Source: CLR and local roads in better local road network was supported by the World conditions Bank (US$25 million), leveraging financing from five other development partners (about Baseline: 0 Km (2009) US$400 million), covering about 1,700 km of secondary and local roads. Target: Project Target: 108 Km (2012); Program Target: 1,700 119 km of local and secondary roads have (2014) been constructed and rehabilitated under the Bank-financed Secondary and Local Roads Project (SLRP) with co-financing from DFID and GoA (total cost US$40 million). Indicator: Percentage of the In 2011, the Bank-financed Transport Project Source: CLR national road network covered introduced Output and Performance Based by performance based Maintenance in two pilot regions of Albania maintenance contracts (representing 10% of the national road network), which were picked up by ARA, and Baseline: 0 (2009) expanded for the whole road network (although with not sufficient funding to address the Target: 10% (2014) accumulated backlog). Indicator: Creation of an asset The Secondary and Local Roads management Source: CLR management system for system (covering almost 5,000 km) was secondary local roads and established at the beginning of SLRP, helping This was introduced at the Albania National Road to prioritize and define the interventions on CPSPR stage (April 2013) as Authority. specific sections based on economic, a milestone to measure engineering, social, environmental, progress towards the Baseline: geographic, and other criteria. This system is achievement of the objective. gradually transferring to Albania Road Target: Authority (ARA), following the gradual transfer of every improved road section. CPS FY11-FY14: Pillar II Actual Results Broadening and sustaining Comments (as of current month/year) Albania’s social gains Results Area: Broader access to education, particularly secondary and higher education, and improved Major quality at all levels Outcome 9. CPS Objective: Improved access to and quality of secondary education Measures Indicator: Secondary Secondary enrollment has increased Source: CLR enrollment rate substantially since 2006. The net enrollment rate was 80% and the gross enrollment rate Annexes CLR Review 25 Independent Evaluation Group CPS FY11-FY14: Pillar II Actual Results Broadening and sustaining Comments (as of current month/year) Albania’s social gains Baseline: 60% (2009) was 91% in 2013. The 100% target (presumably GER) may have been overly Target: 100% (end of 2014) ambitious, though it was not met due in part to the fact that the EEEP made only modest contributions to this outcome. Indicator: Triple shifts Triple shift schools were eliminated, and Source: CLR eliminated and double shifts double shift schools decreased from 36% to reduced from 36% in secondary 13.9% for basic education schools and from The indicator was revised at schools 15% to 5.6% for secondary schools. The the CPS stage (i.e. a baseline EEEP, and particularly its civil works program, for the reduction of double Baseline: No can be credited in part for the achievement of shifts was provided). The this milestone. original indicator also included Target: Yes (2014) basis schools in its formulation Indicator: Complete reform of The secondary general education curriculum Source: CLR curricula for all three grades of was revised and fully adopted in all general secondary school. secondary schools over a three-year cycle This was introduced at the from 2009-2011. Every teacher and CPSPR stage (April 2013) as Baseline: No administrator also received training on the new a milestone to measure curriculum and according to anecdotal progress towards the Target: Yes (2014) evidence, the training was meaningful and achievement of the objective. informative. Indicator: Construction of 12 10 new schools were constructed, 5 existing Source: CLR new schools; extension of 8 schools were extended, and 7 schools were existing schools; and rehabilitated by end-2013. The target for total This was introduced at the rehabilitation of 10 schools number of schools was reduced due to CPSPR stage (April 2013) as completed by end-2013. extensive implementation delays (resulting a milestone to measure from safeguards issues and varied quality of progress towards the Baseline: No construction) and cost overruns. achievement of the objective. Target: Yes Indicator: Percentage of The continuous teacher professional Source: CLR teachers participating in development system that was envisioned at continuous professional the design stage of the EEEP was not This was introduced at the development launched. The current system is only partially CPSPR stage (April 2013) as functional and not properly aligned with a milestone to measure Baseline: 25% in 2009 curriculum reforms. The MoES focused on progress towards the training teachers on the revised curricula, achievement of the objective. Target: 70% at end-2010 including the use of information technologies in the classroom, rather than the formulation of a system for continuous professional development. 10. CPS Objective: Higher education institutions reformed to strengthen financing and overall quality through establishment of a comprehensive assurance system Indicator: Performance based A key element of the Higher Education Source: CLR financing in place for all (11) Strategy and action plan involved revisions to public universities by 2014 the funding formula. This was well developed, The objective and the but budget constraints and political timing due indicator were introduced at Baseline: No to elections in June 2013 prevented the MoES the CPS stage (April 2013). from implementing the new financing Target: Yes mechanism in the 2013-2014 academic year. Full implementation of this mechanism is on hold pending a review from the new government. Annexes CLR Review 26 Independent Evaluation Group CPS FY11-FY14: Pillar II Actual Results Broadening and sustaining Comments (as of current month/year) Albania’s social gains Indicator: 100 university labs Modern didactic equipment was purchased Source: CLR provided with modern didactic and distributed to labs in 12 (of 15) public equipment universities. All public universities are The objective and the equipped with around 106 new science and indicator were introduced at Baseline: No teaching laboratories. The universities the CPS stage (April 2013). managed the procurement processes on their Target: Yes own, which helped to build procurement capacity and to reduce the burden on the MoES. Indicator: Quality assurance The Public Agency for Accreditation of Higher Source: CLR system has been established Education (APAAL) was restructured with for higher education institutions. technical assistance provided by the EEEP. APAAL now uses Standards for Higher Baseline: No Education Institutions, which is also a part of a higher education program ranking initiative. Target: Yes Also, all universities how have strategic plans and external governing boards. However, the quality assurance system that was envisioned when the EEEP was designed was not fully launched. Results Area: Improved access to quality primary health care and more efficient public spending on health care 11. CPS Objective: Improve access to quality primary health care Indicator: Universal re-training The project contributed to the improvement of Source: CLR of PHC providers completed. the PHC providers’ knowledge, providing training to over 630 PHC doctors. This was introduced at the Baseline: No CPSPR stage (April 2013) as a milestone to measure Target: Yes progress towards the achievement of the objective. Indicator: Basic Benefits The benefit package was established but its Source: CLR Package for PHC established implementation needs further improvements. and implemented. This was introduced at the CPSPR stage (April 2013) as Baseline: No a milestone to measure progress towards the Target: Yes achievement of the objective. 12. CPS Objective: Improve the efficiency of public spending on health care Indicator: All public hospitals Public hospitals’ payments are managed by Source: CLR financed under performance- the HII, based on contracts which include a based contracts to achieve number of performance indicators. Although efficiency in spending and good progress was achieved on this front, still reduce share of hospital hospital payments need to be further improved spending in total health towards a fully performance based system. In spending. (Status: 58%; target: addition, the progress has been made also on 48%). reducing the share of hospital spending in total health spending, but still the 48% target is not Baseline: 58% achieved. Target: 48% Indicator: Unification of primary With project support, both primary and Source: CLR and secondary health care secondary (hospital) health care purchasing is purchasing under the Health done under the HII. In addition, the PHC This was introduced at the Insurance Institute services are paid on performance basis, while CPSPR stage (April 2013) as Annexes CLR Review 27 Independent Evaluation Group CPS FY11-FY14: Pillar II Actual Results Broadening and sustaining Comments (as of current month/year) Albania’s social gains work is in progress towards hospitals’ a milestone to measure Baseline: No performance based payments. progress towards the achievement of the objective. Target: Yes Indicator: Increase in the As of 2012, enrollment had reached almost Source: CLR population enrolled in health 60%. insurance This was introduced at the CPSPR stage (April 2013) as Baseline: <10% in 2009 a milestone to measure progress towards the Target: 70% in 2014 achievement of the objective. Results Area: Improved targeting and effectiveness of Albania’s social protection systems 13. CPS Objective: Improved efficiency of social assistance expenditure and benefit administration to increase the percentage of the poor receiving means-based social assistance and to improve the equity and effectiveness of the Ndihma Ekonomike program Indicator: Assessment The Government started the work on revising Source: CLR procedures and eligibility criteria the eligibility criteria for disability benefits. revised for disability benefits SAMP is supporting technical assistance and This was introduced at the (including disability pensions). advisory activities to help the Government in CPSPR stage (April 2013) as designing the revised assessment criteria for a milestone to measure Baseline: No disability benefits based on the “Social Model” progress towards the (incorporating both functional and medical achievement of the objective. Target: Yes criteria), as well as reviewing and designing proposals for revising the business procedures and institutional arrangements. The process has suffered delays, due to delayed start-up of project implementation. However, currently the Government, with TA support, is progressing well, expecting to achieve the expected results soon as planned. Indicator: Electronic central The Government has introduced the electronic Source: CLR registry of beneficiaries registry of beneficiaries of the cash social introduced and fully operational. assistance (NE) program which has become This was introduced at the fully operational in three main regions CPSPR stage (April 2013) as Baseline: No (covering more than 50% of the whole a milestone to measure population), since January 2014. Currently the progress towards the Target: Yes Government is working to expand the registry achievement of the objective. nation-wide as well as establish the registry for the disability beneficiaries. Indicator: Percentage of the The reform of the cash social assistance Source: CLR poor covered by the Ndihma program (NE) has started, including the Ekonomike program is implementation of the Unified Scoring Formula, This was introduced at the estimated to increase (status: aiming at improving equity outcomes. Good CPSPR stage (April 2013) as 22% in 2008; target 40% in progress has been made with the a milestone to measure 2014). implementation of the reform steps. However, progress towards the progress towards achieving the target has to achievement of the objective. Baseline: 22% (2008) be assessed at a later stage (end-2014). Target: 40% (2014) Indicator: Improved financial The Government has established the NE MIS, Source: CLR management systems and fraud which is currently fully operational in the main and error controls for NE fully regions (covering more than 50% of the This was introduced at the operational. population). With the NE MIS in place, the CPSPR stage (April 2013) as a milestone to measure Annexes CLR Review 28 Independent Evaluation Group CPS FY11-FY14: Pillar II Actual Results Broadening and sustaining Comments (as of current month/year) Albania’s social gains Baseline: No inspectors are reporting data on fraud and progress towards the error in the system. achievement of the objective. Target: Yes 14. CPS Objective: Improving the solvency of the pension system Indicator: Dependency rate The CLR does not report updates since 2013 Source: CLR pension system (total number of baseline. beneficiaries divided by total The outcome indicator was number of contributors) introduced at the CPS stage. Baseline: 83% in 2013 Target: < 83% Indicator: Improve participation Participation has reached 35 percent of Source: CLR of the working age population working age population in 2013 (latest data (ages 15-64) in the pension available). The outcome indicator was system introduced at the CPS stage Baseline: 30% Target: 1-2% increase in the CPS period Indicator: Parametric reform of Parametric reform of the pension system Source: CLR the pension system, to improve passed by Parliament on July 31, 2014, with participation and the long term implementation set to begin on January 1, fiscal deficit, under 2015. The law had already been submitted to implementation Parliament by June 30, 2014, end of the CPS period. Baseline: No Target: Yes Indicator: Pension reform Strategy presented to country for consultations Source: CLR strategy adopted in April 2014; draft law arising from the strategy prepared and passed. This was introduced at the Baseline: No CPSPR stage (April 2013) as a milestone to measure Target: Yes progress towards the achievement of the objective. CPS FY11-FY14: Pillar III Reducing Albania’s Actual Results Comments vulnerabilities to climate (as of current month/year) change Results Area: Improve the conversation, management and efficient use of Albania’s water resources 15. CPS Objective: Outcome 15: Reduce upstream risks of erosion by improving management of Albania’s wetlands, forest and pasture resources and water catchments to: (i) increase in income earned from Major forest activities in communal forest and pasture lands; (ii) to reduce erosion Outcome Indicator: Income earned from By 2013, the following were achieved in 251 Source: CLR Measures forest activities in communal communes: (i) 8% increase in income earned forest and pasture lands from forest activities in communal forest and No baseline was provided at pasture lands; (ii) 28% increase in income the CPS stage. Baseline: N/A earned from forest and agricultural activities in 30 micro-catchments. Annexes CLR Review 29 Independent Evaluation Group CPS FY11-FY14: Pillar III Reducing Albania’s Actual Results Comments vulnerabilities to climate (as of current month/year) change Target: 25% Indicator: Tons of erosion As of November 2011, 220,000 tons were Source: CLR reduced reduced. Baseline: N/A Target: 400,000 by 2014 Indicator: Restructured forestry Implementation support and training was Source: CLR extension services provided to the new service under NRDP. This was introduced at the Baseline: No CPSPR stage (April 2013) as a milestone to measure Target: Yes progress towards the achievement of the objective. Indicator: Increased carbon As of July 2013, NRDP had sequestered Source: CLR sequestration from sustainable 128,757.5 tons of CO2 in 4,779 ha of project forestry activities area (it is estimated that in one year, it This was introduced at the sequestered 3.85 t/ha.) In July 2013, 128,757 CPSPR stage (April 2013) as Baseline: 45,000 tons CO2 tons CERs (certified emission reductions) were a milestone to measure sequestered in 2009 issued for the Albania Assisted Natural progress towards the Regeneration Project by the United Nations achievement of the objective. Target: 181,000 tons in 2014 Framework Convention on Climate Change. 16. CPS Objective: Improved critical public environmental infrastructure and municipal services as evidenced by: (i) tons of household waste safely disposed in accordance with EU standards in South Coast; (ii) tons of treated sewage in coastal cities Indicator: Tons of household Data not available. Project still under Source: CLR waste safely disposed in implementation with closing in FY16. accordance with EU standards in South Coast. Baseline: 0 Target: ≥ 5,000 Indicator: Tons of treated Data will be available in 03/2015. Source: CLR sewage in coastal cities Baseline: 0 (2010) Target: 48,000 (2012) Indicator: Completed The remediation of the contaminated site of Source: CLR remediation of one of the most Porto Romano was completed in May 2011. contaminated coastal sites at This was introduced at the Porto Romano. CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Indicator: Operational landfill Landfill construction expected to be finalized Source: CLR near Saranda and transfer by October 30, 2014; Himara transfer station center in Himara by December 31, 2014. Full outcomes are This was introduced at the expected to be achieved by project closure CPSPR stage (April 2013) as Baseline: No (03/2015) a milestone to measure Annexes CLR Review 30 Independent Evaluation Group CPS FY11-FY14: Pillar III Reducing Albania’s Actual Results Comments vulnerabilities to climate (as of current month/year) change progress towards the Target: Yes achievement of the objective. Indicator: Completed The CLR reports that the extensions to the Source: CLR extensions to the sewage sewage network and wastewater outlet in network and wastewater outlet Saranda were completed. This was introduced at the in Saranda CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes Indicator: Adoption of new The management plan was adopted in Source: CLR management plan for Butrint December 2011. National Park and wetlands in This was introduced at the line with Ramsar Convention CPSPR stage (April 2013) as a milestone to measure Baseline: No progress towards the achievement of the objective. Target: Yes 17. CPS Objective: Improve the framework for management of water resources Indicator: Capacity building The process for preparing the WRIP design Source: CLR programs provided to the involved various stakeholders at the central National Water Council, water and regional levels. Two important analyses This was introduced at the user associations, and drainage were carried out during this period: Irrigation CPSPR stage (April 2013) as boards and Drainage Position Paper and Integrated a milestone to measure Water Resources Management Position Paper. progress towards the Baseline: No achievement of the objective. Target: Yes Indicator: Joint Albania/ Four bilateral agreements between Albania Source: CLR Montenegro Lake Shkodra and Montenegro on the joint financing of the management cross border Commission and Secretariat, as well as on the This was introduced at the institution fully operational shared use of the lake information systems CPSPR stage (April 2013) as were signed. But neither governments a milestone to measure Baseline: No provided adequate resources or staffing for the progress towards the operation of Lake Shkodra Commission once achievement of the objective. Target: Yes the project was closed. In 2013, modest funding was allocated but not used. Annex Table 2: Planned and Actual Lending for Albania, FY11-14 Approved Approved Project Proposed Approval Closing Proposed Outcome Project name IBRD IDA ID FY FY FY Amount Rating Amount Amount Project Planned Under CPS / CPSPR FY11-14 P116937 Social sector reform DPL FY11 FY11 FY12 25 25 IEG: U Addtl Financing APL5 Dam P125856 safety FY12 FY12 21.6 21.6 LIR:MS Social Assistance Modern P122233 Project FY12 FY12 FY17 50 50 LIR: S P121186 Water Resource and Irrigation FY13 FY13 FY18 40 40 LIR: MU P102733 Water Sector Inv Sector FY13 FY14 FY19 86 85.3 LIR: MS P132982 Road Maint & Safety FY13 30 Annexes CLR Review 31 Independent Evaluation Group Approved Approved Project Proposed Approval Closing Proposed Outcome Project name IBRD IDA ID FY FY FY Amount Rating Amount Amount Energy Sec Reform & Rec P144029 Proj FY14 FY15 FY20 150 150 LIR: S P146280 Fin Sector DPL FY14 FY14 FY15 150 100 P144688 Health Project FY14 42 Education FY14 10 Public Sector Reform FY14 10 P130492 Environment Services FY14 FY15 FY20 10 10 LIR: S Total Planned 624.6 481.9 0 Unplanned Projects during the CPS and CPSPR Period P147226 Public Finance DPL 2014 2016 120 Total Unplanned 120 0 Approved Approved On-going Projects during the CPS and Approval Closing IBRD IDA CPSPR Period FY FY Amount Amount P055383 SOC SERV DEVT 2001 2013 10 IEG: MS POWER SECTOR GENER & P077526 RESTRCT'G 2004 2012 25 IEG: U P082375 NATURAL RES DEVT 2005 2011 7 IEG: MS P090656 ECSEE APL2 (ALBANIA) 2005 2012 27 IEG: MS COASTAL ZONE MGMT (APL P086807 #1) 2005 2015 18 LIR: MS P100273 AVIAN FLU - AL 2006 2011 5 IEG: MS P082814 HEALTH SYST MOD 2006 2012 15 IEG: S P078933 EDUC EXCEL & EQUITY 2006 2013 15 IEG: MU P078949 TRANSPORT 2007 2011 20 5 IEG: S P096643 AL Busi Env Ref & Insti Streng 2007 2012 5.6 4 IEG: MS P096263 LAND ADMIN & MGMT PROJ 2007 2014 19.96 15 LIR: MS SECONDARY AND LOCAL P107833 ROADS 2008 2013 0 20 IEG: HS DISASTER RISK P110845 MITIGATION 2008 2013 3 6 IEG: MU P110481 ECSEE APL 5 DAM SAFETY 2008 2017 0 35 LIR: MS ADD'L FIN - SOC SERVICE P107382 DEL 2009 5 Total On-going 54 207 Source: Albania CPS, CPSPR and AO as of 2/2/15 *LIR: Latest internal rating. MU: Moderately Unsatisfactory. MS: Moderately Satisfactory. S: Satisfactory. HS: Highly Satisfactory. Annex Table 3: Analytical and Advisory Work for Albania, FY11 - FY14 Proj ID Economic and Sector Work Fiscal year Output Type P107759 Accountability for Better Governance AAA FY11 Report P117865 Albania: #8090 Fin Crisis CP & Sim. Ex. FY11 "How-To" Guidance P118219 Albania GPF - e-government TA FY11 "How-To" Guidance P124165 DeMPA Assessment - Albania FY11 Report P112643 FBS - Pro-Poor Gov in Water and Electr FY12 TA/IAR P119929 Expropriation safeguards TA (TF096005) FY12 TA/IAR P122125 FBS-Pro-Poor Govt in Water and Electric. FY12 TA/IAR P122126 FBS-Pro-Poor Govt. in Water and Electric FY12 TA/IAR Annexes CLR Review 32 Independent Evaluation Group P126807 Albania repeat PEFA Assessment FY12 Client Document Review P115786 Albania CGAC Program - GPF Grant FY13 TA/IAR P127294 Albania #10051 Liberalizing MTPL Ins Mkt FY13 TA/IAR P127599 Pension Reform TA FY13 TA/IAR P130386 Universal Access and Service ICT Sector FY13 TA/IAR P130439 Albania #10177 Strength Deposit Insurance FY13 TA/IAR P131457 Support to PFM Strategy in Albania FY14 TA/IAR P143099 Public Finance Review FY14 Not assigned P145524 Policy Notes FY14 Not assigned P146188 Albania FSAP Update FY14 Not assigned Proj ID Technical Assistance Fiscal year Output Type P117865 Albania: #8090 Fin Crisis CP & Sim. Ex. FY11 "How-To" Guidance P118219 Albania GPF - e-government TA FY11 "How-To" Guidance P112643 FBS - Pro-Poor Gov in Water and Electr FY12 TA/IAR P119929 Expropriation safeguards TA (TF096005) FY12 TA/IAR P122125 FBS-Pro-Poor Govt in Water and Electric. FY12 TA/IAR P122126 FBS-Pro-Poor Govt. in Water and Electric FY12 TA/IAR P126807 Albania repeat PEFA Assessment FY12 Client Document Review P115786 Albania CGAC Program - GPF Grant FY13 TA/IAR P127294 Albania #10051 Liberalizing MTPL Ins Mkt FY13 TA/IAR P127599 Pension Reform TA FY13 TA/IAR P130386 Universal Access and Service ICT Sector FY13 TA/IAR P130439 Albania #10177 Strength Deposit Insuranc FY13 TA/IAR P131457 Support to PFM Strategy in Albania FY14 TA/IAR Annex Table 4: Grants and Trust Funds Active in FY11-14 for Albania (in US$ million) Project Project name TF ID Approval Closing Approved ID FY FY Amount P091145 Afforestation & Reforestation of Refused Lands in TF 56871 2007 2019 1,013,584 Albania BioCarbon Fund Project P121186 Water Resources and Irrigation Project TF 14255 2013 2018 4,675,000 P129332 Second MDTF for Capacity Building Support to TF 13972 2013 2016 3,623,846 Implement the IPS (IPS 2) P143963 Albania MDTF for Extractive Industry Transparency TF 14999 2014 2015 300,000 Initiative (EITI), Implementation Support, Phase III P132679 Land Degradation Enabling Activities - Albania TF 13194 2013 2015 150,000 P132982 Results-based Road Maintenance and Safety Project TF 14761 2014 2015 700,000 P132129 Revision of the National Biodiversity Strategy and TF 12599 2013 2015 220,000 Action Plan P086807 Integrated Coastal Zone Management & Clean- TF 55922 2006 2015 2,509,878 Up Project (APL #1) P086807 Integrated Coastal Zone Management & Clean- TF 55065 2006 2015 2,230,000 Up Project (APL #1) P120961 Free Standing TF on Natural Resource Development TF 11576 2012 2014 2,716,028 Annexes CLR Review 33 Independent Evaluation Group Project Project name TF ID Approval Closing Approved ID FY FY Amount P125591 REPARIS Albania MDTF No. TF098923 Corporate TF 98923 2011 2014 1,819,876 Financial Reporting Enhancement Project P113978 Youth Empowerment through Community TF 93709 2010 2014 1,155,700 Development in Albania P096263 Land Administration and Management Project (LAMP) TF 12392 2013 2014 2,706,131 P096263 Land Administration and Management Project (LAMP) TF 90309 2008 2014 2,447,013 P102733 Water Sector Investment Project TF 93096 2010 2013 980,000 P116632 Albania: Extractive Industries Transparency Initiative TF 12148 2012 2013 110,000 Implementation P127684 Supporting to increasing security of Albania's e- TF 11176 2012 2013 100,000 procurement system P122216 Albania - Mini Development Marketplace for TF 97338 2011 2013 140,000 Governance P114789 Strengthening Aarhus Convention Implementation TF 94711 2010 2013 370,000 P110845 Disaster Risk Mitigation and Adaptation Project TF 99141 2011 2013 600,000 P084605 ALBANIA/MONTENEGRO LAKE SKHODER TF 91937 2009 2013 1,990,000 INTEGRATED ECOSYSTEM MANAGE P096263 Land Administration and Management Project (LAMP) TF 56729 2008 2013 1,537,000 P116632 Albania: Extractive Industries Transparency Initiative TF 96009 2010 2012 275,000 Implementation P105143 Albania MD Capacity Building & Support to TF 90843 2008 2012 6,391,344 Implement the Integrated Planning System P082814 Health System Modernization Project TF 55804 2006 2012 1,610,000 P089061 Albania - Natural Resources Development Project TF 54926 2005 2012 5,000,000 P085089 Albania Butrint Global Biodiversity and Heritage TF 56176 2008 2011 950,000 Conservation P100273 Avian Influenza Control and Human Pandemic TF 56728 2007 2011 800,000 Preparedness and Response Project P086807 Integrated Coastal Zone Management & Clean- TF 54400 2006 2011 3,113,333 Up Project (APL #1) P082375 Natural Resources Development Project TF 54995 2006 2011 5,047,774 Total 55,281,506 Source: Client Connection as of 1/21/15 Annex Table 5: IEG Project Ratings for Albania, FY11-Present Total Exit Proj ID Project name Evaluated IEG Outcome IEG Risk to DO FY ($M) 2011 P078949 TRANSPORT 26.1 SATISFACTORY MODERATE 2011 P082375 NATURAL RES DEVT 6.9 MODERATELY SATISFACTORY SIGNIFICANT 2011 P100273 AVIAN FLU - AL 3.9 MODERATELY SATISFACTORY SIGNIFICANT 2012 P077526 POWER SECTOR GENER & RESTRCT'G 24.7 UNSATISFACTORY HIGH 2012 P082814 HEALTH SYST MOD 14.5 SATISFACTORY MODERATE 2012 P090656 ECSEE APL2 (ALBANIA) 22.3 MODERATELY SATISFACTORY SIGNIFICANT 2012 P096643 AL Busi Env Ref & Insti Streng 9.2 MODERATELY SATISFACTORY MODERATE 2012 P105143 IPS Implementation 0.0 MODERATELY SATISFACTORY MODERATE Annexes CLR Review 34 Independent Evaluation Group Total Exit Proj ID Project name Evaluated IEG Outcome IEG Risk to DO FY ($M) 2012 P116937 Social Sector Reform DPL 25.0 UNSATISFACTORY NEGLIGIBLE TO LOW 2013 P055383 SOC SERV DEVT 16.4 MODERATELY SATISFACTORY MODERATE 2013 P078933 EDUC EXCEL & EQUITY 14.6 MODERATELY UNSATISFACTORY MODERATE 2013 P107833 SECONDARY AND LOCAL ROADS 18.7 HIGHLY SATISFACTORY MODERATE 2013 P110845 DISASTER RISK MITIGATION 8.3 MODERATELY UNSATISFACTORY SIGNIFICANT Total 190.6 Source: AO Key IEG Ratings as of 1/20/15 Annex Table 6: IEG Project Ratings for Albania and Comparators, FY11-14 RDO % RDO % Total Total Outcome Outcome Moderate or Moderate or Region Evaluated Evaluated % Sat ($) % Sat (No) Lower Lower ($M) (No) Sat ($) Sat (No) Albania 190.6 13 61.9 69.2 65.3 61.5 ECA 11,499.6 165 87.2 74.8 69.6 66.0 World 70,888.6 842 82.1 69.3 64.3 50.9 Source: AO IEG Bank and Borrower Performance as of 1/20/15 * With IEG new methodology for evaluating projects, institutional development impact and sustainability are no longer rated separately. Annex Table 7: Portfolio Status for Albania and Comparators, FY11-14 Fiscal year 2011 2012 2013 2014 Total Albania # Proj 16 12 13 13 54 # Proj At Risk 2 3 3 2 10 % Proj At Risk 12.5 25.0 23.1 15.4 18.5 Net Comm Amt 262.4 224.3 208.9 485.9 1,181.5 Comm At Risk 50.0 59.1 108.7 96.9 314.7 % Commit at Risk 19.0 26.4 52.0 19.9 26.6 ECA # Proj 290 256 246 280 1,072 # Proj At Risk 40 47 47 37 171 % Proj At Risk 13.8 18.4 19.1 13.2 16.0 Net Comm Amt 22,649.7 23,091.9 24,699.7 26,927.9 97,369.1 Comm At Risk 2,116.9 2,668.4 3,844.0 2,635.4 11,264.7 % Commit at Risk 9.3 11.6 15.6 9.8 11.6 World # Proj 2,059 2,029 1,965 2,049 8,102 # Proj At Risk 382 387 414 412 1,595 % Proj At Risk 18.6 19.1 21.1 20.1 19.7 Net Comm Amt 171,755.3 173,706.1 176,206.6 192,614.1 714,282.1 Comm At Risk 23,850.0 24,465.0 40,805.6 40,933.5 130,054.1 % Commit at Risk 13.9 14.1 23.2 21.3 18.2 Source: AO Projects at risk by Year as of 1/20/15 Annexes CLR Review 35 Independent Evaluation Group Annex Table 8: Disbursement Ratio for the Albania, FY11-14 Fiscal Year 2011 2012 2013 2014 Overall Result Albania Disbursement Ratio (%) 21.92 23.80 17.13 23.24 21.48 Inv Disb in FY 36.77 28.76 25.05 36.96 127.53 Inv Tot Undisb Begin FY 167.73 120.82 146.21 159.01 593.77 LCR Disbursement Ratio (%) 20.51 25.92 24.15 22.78 23.33 Inv Disb in FY 2,806.39 3,498.43 2,925.82 2,611.49 11,842.13 Inv Tot Undisb Begin FY 13,682.49 13,495.75 12,113.73 11,466.36 50,758.33 World Disbursement Ratio (%) 22.38 20.79 20.60 20.79 21.12 Inv Disb in FY 20,933.51 21,048.75 20,509.01 20,756.34 83,247.62 Inv Tot Undisb Begin FY 93,516.54 101,239.14 99,582.39 99,848.44 394,186.51 * Calculated as IBRD/IDA Disbursements in FY / Opening Undisbursed Amount at FY. Restricted to Lending Instrument Type = Investment. Source: AO as of 1-26- Annexes CLR Review 36 Independent Evaluation Group Annex Table 9A: List of IFC Investments Committed in FY11-FY14 Project Institution Cmt Project Primary Greenfield Project Original Original Original Loan Equity Net Net Net ID Number FY Status Sector Name Code Size Loan Equity CMT Cancel Cancel Loan Equity Comm 33378 747848 2014 Active Electric Power E 144,261 44,911 - 44,911 4,039 - 40,872 - 40,872 Finance & 32190 568237 2013 Active G 12,581 11,806 - 11,806 6,736 - 5,070 - 5,070 Insurance Finance & 32749 568237 2013 Active E 50 50 - 50 - - 50 - 50 Insurance Oil, Gas and 33077 622404 2013 Active G 439,000 50,000 - 50,000 - - 50,000 - 50,000 Mining Finance & 33093 696024 2013 Active E 2,000 718 - 718 - - 718 - 718 Insurance 29208 685904 2012 Closed Electric Power E 69,158 72,378 - 72,378 44,046 - 28,332 - 28,332 30979 692149 2012 Active Electric Power G 139,728 - 8,662 8,662 - - 8,662 8,662 8,662 Nonmetallic Mineral 32001 629688 2012 Active E 6,698 - 6,698 6,698 - - 6,698 6,698 6,698 Product Manufacturing Sub-Total 813,475 179,863 15,360 195,223 54,821 - 140,402 15,360 140,402 Annex Table 9B: Investments Committed pre-FY11 but active during FY11-14 Project Project Institution CMT Primary Sector Greenfield Project Original Original Original Loan Equity Net Net Net Status ID Number FY Name Code Size Loan Equity CMT Cancel Cancel Loan Equity Comm Name Finance & 26068 52371 2010 Active E 1,000 2,675 - 2,675 - - 2,675 - 2,675 Insurance Oil, Gas and 27306 622404 2009 Active G 575,203 55,000 10,403 65,403 2,000 - 63,403 10,403 63,403 Mining Construction 25922 573015 2008 Active G 10,595 12,122 - 12,122 4,162 - 7,961 - 7,961 and Real Estate 25323 564441 2007 Active Manufacturing E 6,791 2,632 - 2,632 - - 2,632 - 2,632 Nonmetallic 21118 519129 2005 Active Mineral Product G 130,000 30,000 - 30,000 - - 30,000 - 30,000 Manufacturing Nonmetallic 27958 629688 1900 Active Mineral Product G - - - - - - - - - Manufacturing Sub-Total 723,588 102,430 10,403 112,833 6,162 - 106,671 10,403 106,671 TOTAL 1,537,063 282,293 25,762 308,055 60,982 - 247,073 25,762 247,073 Source: MIS Extract Data as of December 30, 2014 Annexes CLR Review 37 Independent Evaluation Group Annex Table 10A: List of IFC Advisory Services Advisory Services Approved in FY11-14 Impl Primary Impl Project ID Project Name Start Project Status Business Total Funds, US$ End FY FY Line 600511 Albania Labs PPP 2015 2016 ACTIVE PPP 354,690 599428 ECA DR Al 2014 2017 ACTIVE IC 237500 599656 Albania General & Administration 2014 2018 ACTIVE SBA 128623 600200 AlbPetrol PPP 2014 2015 TERMINATED PPP 1,276,142 599053 Albania Solid Waste 2013 2015 ACTIVE PPP 842,269 583387 Albanian hydroelectric power plant privatization 2012 2013 ACTIVE PPP 923,665 29970 Albanian Highway 2011 2016 ACTIVE PPP 2,030,357 566368 Albania Sub-national Regulatory Simplification and Investment Generation 2011 2012 CLOSED IC 710,975 572687 Trade Logistics South East Europe 2012 2015 ACTIVE IC 2,709,719 599174 Indicator Based Reform Advisory in ECA 2013 2016 ACTIVE IC 783,500 586209 ECA Corporate Governance Program 2012 2016 ACTIVE SBA 4,823,704 Sub-Total 14,821,144 Annex Table 10B: Advisory Services Approved pre-FY11 but active during FY11-14 Primary Project ID Project Name Start FY End FY Project Status Total Funds, US$ Business Line 568367 Residential Energy Efficiency Project- Albania 2010 2016 ACTIVE A2F 769,819 575568 Renewable Energy Albania Small Hydro Power 2010 2016 ACTIVE SBA 1,286,580 567127 CorpGovAlb-II 2009 2012 CLOSED SBA 398,192 565267 ISTR AL Exten 2009 2012 CLOSED SBA 434,297 Sub-Total 2,888,888 TOTAL 17,710,032 Source: IFC AS Data as of June 30, 2014 Annexes CLR Review 38 Independent Evaluation Group Annex Table 11: Net Disbursement and Charges for Albania, FY11-14 Period Disb. Amt. Repay Amt. Net Amt. Charges Fees Net Transfer Jul 2010 - Jun 2011 33.11 11.83 21.28 0.35 6.50 14.44 Jul 2011 - Jun 2012 52.50 15.07 37.42 0.88 7.06 29.49 Jul 2012 - Jun 2013 32.58 18.60 13.98 0.61 6.94 6.44 Jul 2013 - Jun 2014 37.44 26.22 11.23 2.57 7.03 1.63 Report Total 155.62 71.71 83.91 4.40 27.52 51.99 World Bank Client Connection 1/21/15 Annex Table 12: Total Net Disbursements of Official Development Assistance and Official Aid for Albania Development Partners 2011 2012 2013 Australia 0.01 0.02 0.01 Austria 8.09 8.9 10.11 Belgium 0.02 0.01 .. Canada 0.07 0.01 0.03 Czech Republic 0.47 0.42 0.22 Denmark 1.42 1.58 1.03 Finland 0.57 0.33 0.44 France 4.2 4.21 36.4 Germany 38.76 25.87 29.7 Greece 51.97 39.24 2.34 Ireland 0.01 0.07 0.07 Italy 40.42 32 9.49 Japan 5.85 -0.69 -0.51 Korea 0.07 0.05 .. Luxembourg 0.04 0.16 0.01 Netherlands 0.38 .. .. Norway 2.76 1.55 1.72 Poland 0.06 0.1 0.14 Portugal .. 0 0 Slovak Republic .. 0.04 0.03 Slovenia 0.23 0.62 0.26 Spain -0.53 -1.49 -4.97 Sweden 13.25 12.15 11.68 Switzerland 12.66 11.26 28.31 United Kingdom 0.68 1.02 1.19 United States 25.47 21.82 23.67 DAC Countries, Total 206.93 159.25 151.37 EU Institutions 127.93 127.56 97.11 GAVI 0.4 0.28 0.16 GEF 2 1.6 0.83 Global Fund 0.62 0.23 0.18 IAEA 1.13 0.43 0.7 IDA 12.05 14.19 -4.68 IFAD 0.51 1.15 1.98 IMF (Concessional Trust Funds) -11.26 -8.9 -8.35 Isl.Dev Bank -3.2 3.7 .. OFID 3.61 8.35 11.16 OSCE 3.96 3.31 3.32 Annexes CLR Review 39 Independent Evaluation Group Development Partners 2011 2012 2013 UNDP 0.47 0.51 0.43 UNECE .. 0.02 0 UNFPA 0.61 0.66 0.55 UNHCR 0.25 .. .. UNICEF 0.75 0.72 0.98 WHO 0.17 0.01 0.03 Multilateral, Total 140 153.82 104.4 Estonia 0.03 .. 0.07 Hungary 0.05 0.03 0.04 Israel 0.02 0.06 0.08 Kuwait (KFAED) -0.72 1.73 4.02 Lithuania 0.02 .. .. Romania 0.84 0.82 0.44 Russia .. 0.09 0.68 Turkey 3.58 7.89 9.24 United Arab Emirates .. 17.91 28.05 Non-DAC Countries, Total 3.82 28.53 42.62 Development Partners Total 350.75 341.6 298.39 Source: OECD Stat, [DAC2a] as of 1/21/15 Annex Table 13: Economic and Social Indicators for Albania, 2011-2013 ALB ECS World Series Name 2011 2012 2013 Average 2011-2013 Growth and Inflation GDP growth (annual %) 2.5 1.6 1.4 1.9 0.9 2.4 GDP per capita growth (annual %) 3.5 2.6 2.4 2.9 0.5 1.3 GNI per capita, PPP (current international $) 9,870.0 9,930.0 10,400.0 10,066.7 27,444.5 13,844.9 GNI per capita, Atlas method (current US$) (Millions) 12,766.4 12,683.9 13,064.8 12,838.4 22,401,733.3 72,402,366.7 Inflation, consumer prices (annual %) 3.5 2.0 1.9 2.5 2.8 3.8 Compositon of GDP (%) Agriculture, value added (% of GDP) 21.0 21.8 22.2 21.7 2.0 3.1 Industry, value added (% of GDP) 14.3 14.4 15.3 14.6 25.6 26.9 Services, etc., value added (% of GDP) 64.8 63.7 62.5 63.7 72.4 70.0 Gross fixed capital formation (% of GDP) 29.4 25.8 26.2 27.1 19.9 21.9 Gross domestic savings (% of GDP) 8.7 10.0 11.0 9.9 22.4 22.4 External Accounts Exports of goods and services (% of GDP) 34.0 33.3 35.1 34.1 41.0 29.9 Imports of goods and services (% of GDP) 56.7 51.9 52.9 53.8 38.9 29.9 Current account balance (% of GDP) -12.9 -10.2 -10.7 -11.3 External debt stocks (% of GNI) 48.4 56.5 60.1 55.0 Total debt service (% of GNI) 1.9 2.1 3.2 2.4 Total reserves in months of imports 4.2 5.0 .. 4.6 6.3 13.3 Fiscal Accounts /1 General government revenue (% of GDP) 25.8 25.1 24.1 25.0 General government total expenditure (% of GDP) 29.4 28.6 29.3 29.1 Annexes CLR Review 40 Independent Evaluation Group ALB ECS World Series Name 2011 2012 2013 Average 2011-2013 General government net lending/borrowing (% of GDP) -3.6 -3.5 -5.2 -4.1 General government gross debt (% of GDP) 60.4 62.9 70.5 64.6 Social Indicators Health Life expectancy at birth, total (years) 77.2 77.4 .. 77.3 76.6 70.7 Immunization, DPT (% of children ages 12-23 months) 99.0 99.0 99.0 99.0 95.3 83.3 Improved sanitation facilities (% of population with access) 90.7 91.2 .. 91.0 92.6 63.4 Improved water source (% of population with access) 93.8 93.8 .. 93.8 94.2 81.2 Mortality rate, infant (per 1,000 live births) 14.2 13.8 13.3 13.8 11.1 34.6 Education School enrollment, preprimary (% gross) 63.9 68.8 .. 66.4 77.2 52.7 School enrollment, primary (% gross) .. .. .. 101.8 108.3 School enrollment, secondary (% gross) .. .. .. 99.1 72.7 Population 2,829,33 2,801,681 2,773,620 2,801,54 Population, total (Millions) 7.0 .0 .0 6.0 895.9 7,044.1 Population growth (annual %) -1.0 -1.0 -1.0 -1.0 0.4 1.2 Urban population (% of total) 53.2 54.3 55.4 54.3 70.3 52.5 Source: DDP as of 12/19/2014 *International Monetary Fund, World Economic Outlook Database, October 2014