The World Bank Skills Development Project (P131660) REPORT NO.: RES36015 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF SKILLS DEVELOPMENT PROJECT APPROVED ON JUNE 19, 2014 TO REPUBLIC OF MALAWI EDUCATION AFRICA Regional Vice President: Hafez M. H. Ghanem Country Director: Bella Bird Senior Global Practice Director: Jaime Saavedra Chanduvi Practice Manager/Manager: Sajitha Bashir Task Team Leader: Nobuyuki Tanaka The World Bank Skills Development Project (P131660) I. BASIC DATA Product Information Project ID Financing Instrument P131660 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 19-Jun-2014 30-Jun-2019 Organizations Borrower Responsible Agency Republic of Malawi Ministry of Finance, Economic Planning & Development Project Development Objective (PDO) Original PDO The development objective of the proposed project is to increase access, market relevance, and results orientation of supported skills development institutions in agreed priority areas. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-54720 19-Jun-2014 13-Aug-2014 11-May-2015 30-Jun-2019 41.90 32.57 4.84 IDA-H9590 19-Jun-2014 13-Aug-2014 11-May-2015 30-Jun-2019 4.90 4.32 .17 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES The World Bank Skills Development Project (P131660) 1. The Skills Development Project (SDP) was approved by the World Bank Board on June 19, 2014 and became effective on May 11, 2015. After the Mid-term Review (MTR), the project has been progressing well, especially taking into consideration the initial delay of the project effectiveness (delay of almost one year). The project closing date is June 30, 2019. 2. The project has realized a significant developmental impact to date. All six PDO-level indicators are on-track, and some indicators have already met the end-project targets. Project ratings have been steadily improving and have been Satisfactory for implementation progress for more than six months, and for the progress towards achievement of the PDO for more than one year. The disbursement ratio of the project is 88 percent as of March 4, 2019. The project is highly likely to achieve the PDO. All the Participating Institutions (PIs) and National Council for Higher Education (NCHE) are committed to delivering the results. 3. Component 1 is to strengthen institutional performance through Sub-Project Grant Agreements (SPGAs), and five PIs have been implementing their Institutional Improvement Plans, using Results Based Financing / Disbursement Linked Indicator (DLI) approach. Under Component 1, all five PIs have met many of Disbursement Linked Results (DLRs), which have been verified by a third-party validation (TPV) firm, and a few more validation exercises are expected to take place to validate the rest of the results to be achieved by PIs. 4. Component 2 is for technical assistance for system strengthening and policy reforms, and NCHE has executed the activities under the Component 2, including consultancy services, procurement of goods, capacity development, and project management/ coordination. These activities have been completed already or on track. 5. However, the project identified that two construction of buildings will be only completed after the current project closing date (June 30, 2019). One is an ODL Center at Area 47 for Lilongwe University of Agriculture and Natural Resources (LUANAR). Part of the reasons for the delay in this construction activity includes the requirement for the re-design of the building, which is less expensive but requires longer work schedule than originally planned. Another construction activity is a tourism and hospitality management facility at Mzuzu University. Due to the dissolved Joint Venture contractor, Mzuzu University needed to be engaged with a new contractor, which caused delays of the implementation of construction activities. Both PIs prepared detailed time schedules, and these two construction activities are expected to be completed before proposed new closing date of December 31, 2019. In addition, a few staff members will complete their training/studies and return to PIs only after June 30, 2019. This means validation of these results by the TPV firm – hired by NCHE using SDP fund – need to be done after the current closing date. 6. To allow the project to complete these two construction activities, staff development program, and validation exercise, the government requested a project restructuring (letter dated on January 31, 2018) to extend the project closing date from June 30, 2019 to December 31, 2019. 7. The project prepared the implementation plans and budget for the remaining activities with the proposed extension (attached to the government letter as an annex), which is satisfactory to the World Bank team. There is no overdue financial audit. FY18 audit report was submitted on time with clean opinion. If approved, this will be cumulatively six months extension of the project closing date. The World Bank Skills Development Project (P131660) II. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications IDA-54720 Effective 30-Jun-2019 31-Dec-2019 30-Apr-2020 IDA-H9590 Effective 30-Jun-2019 31-Dec-2019 30-Apr-2020