The World Bank Implementation Status & Results Report Ethiopia: SME Finance Project (P148447) Ethiopia: SME Finance Project (P148447) AFRICA | Ethiopia | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2016 | Seq No: 8 | ARCHIVED on 17-Dec-2019 | ISR39664 | Implementing Agencies: National Bank of Ethiopia, Development Bank of Ethiopia, MOFEC, Federal Small and Medium Manufacturing Industry Development Agency Key Dates Key Project Dates Bank Approval Date: 17-May-2016 Effectiveness Date: 01-Sep-2016 Planned Mid Term Review Date: 14-Nov-2019 Actual Mid-Term Review Date: 14-Nov-2019 Original Closing Date: 31-Aug-2022 Revised Closing Date: 31-Aug-2022 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to increase access to finance for Eligible Small and Medium Enterprises in the Recipient's territory. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Financial Services to SMEs:(Cost $193.00 M) Enabling Environment for SME Finance:(Cost $0.80 M) Business Development Services for SMEs:(Cost $2.50 M) Project Management, Communication and Impact Evaluation:(Cost $3.70 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions Implementation progress: The overall implementation progress of the project is satisfactory. The project has also made good progress since the last Implementation Support Mission (ISM) in June 2019. Four of the five planned actions identified during the last ISM are completed: (i) DBE's allocation for working capital loan has increased from 20% to 50% of the credit line; (ii) Finalized disbursement condition of funds to all Participating Financial Institutions, (iii) Conducted a midterm review for the project, (iv) Finalized client registration database and project website. Credit line: As of September 30, 2019, the credit line disbursed US$129 million which is on track to achieve an end year target disbursement of $155 million. Out of the total withdrawn amount, DBE has allocated US$101 million for direct leasing while the remaining US$28 million has been allocated for working capital loan. So far, 237 SMEs accessed lease financing from DBE and 305 SMEs accessed working capital loan from PFIs. 12/17/2019 Page 1 of 5 The World Bank Implementation Status & Results Report Ethiopia: SME Finance Project (P148447) The NPL of the leasing window of the project is less than 2% - this is well below the 8% threshold set for the project and much lower than DBE’s overall NPL of about 34%. Collateral registry: In June 2019, the Parliament passed a Proclamation to Provide for Movable Property Security Right, as the legal basis for facilitating provision of credit using movables as a collateral. The drafting committee consisting of the National Bank of Ethiopia as well as financial institutions’ legal experts, supported by the WBG team worked on this piece of legislation that follows global good practices, and opens the path for the creation of the collateral registry. Following the ratification of the Law, procurement for hardware and software for movable collateral registry is initiated through the SME Finance Project, and the procurement is in process. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Moderate Substantial Substantial Macroeconomic Moderate Moderate Moderate Sector Strategies and Policies Low Low Low Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Sustainability Moderate Moderate Moderate Fiduciary Substantial Substantial Substantial Environment and Social Moderate Moderate Moderate Stakeholders Moderate Moderate Moderate Other -- -- -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes To increase access to finance for eligible SME in Ethiopia. IN00776867 ►Volume of Financial Support to SMEs under the credit facility (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 71,800,000.00 71,800,000.00 269,000,000.00 Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 IN00776868 ►Number of SMEs Reached with Financial Services under the credit facility (Number, Custom) 12/17/2019 Page 2 of 5 The World Bank Implementation Status & Results Report Ethiopia: SME Finance Project (P148447) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 224.00 224.00 2,152.00 Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 IN00776869 ►Portfolio Quality under the credit facility (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 5.00 5.00 5.00 Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 IN00776870 ►Beneficiaries reached with financial services (Number, Corporate) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 224.00 224.00 2,152.00 Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 Intermediate Results Indicators by Components Financial Services to SMEs IN00776936 ►Number of Loans/ Leases disbursed to SMEs under the credit facility (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 224.00 224.00 3,873.00 Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 IN00776939 ►Collateral Registry Established (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 Enabling Environment for SME Finance IN00776937 ►Insolvency Diagnostic Completed (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 17-Aug-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 IN00776940 12/17/2019 Page 3 of 5 The World Bank Implementation Status & Results Report Ethiopia: SME Finance Project (P148447) ►Report drafted on citizen engagement survey (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 20-Apr-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 Business Development Services for SMEs IN00776938 ►Number of SMEs that received training through a BDS Program under the project (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 912.00 Date 01-Feb-2016 29-Nov-2018 29-Nov-2018 31-Aug-2022 Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P148447 IDA-57930 Effective USD 200.00 200.00 0.00 108.07 93.33 54% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P148447 IDA-57930 Effective 17-May-2016 15-Jun-2016 01-Sep-2016 31-Aug-2022 31-Aug-2022 Cumulative Disbursements 12/17/2019 Page 4 of 5 The World Bank Implementation Status & Results Report Ethiopia: SME Finance Project (P148447) Restructuring History Level 2 Approved on 20-Sep-2017 Related Project(s) There are no related projects. 12/17/2019 Page 5 of 5