Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) Second Private Sector Competitiveness and Economic Diversification Prj (P144933) AFRICA | Lesotho | Investment Climate Practice Global Practice | IBRD/IDA | Investment Project Financing | FY 2014 | Seq No: 3 | ARCHIVED on 19-Dec-2014 | ISR17616 | Implementing Agencies: Ministry of Trade and Industry, Cooperatives and Marketing Key Dates Key Project Dates Board Approval date:31-Oct-2013 Effectiveness Date:09-Jan-2014 Planned Mid Term Review Date:01-Nov-2016 Actual Mid-Term Review Date:-- Original Closing Date:30-Apr-2019 Revised Closing Date:30-Apr-2019 Project Development Objectives Project Development Objective (from Project Appraisal Document) The development objective of the proposed project is to contribute to the development of selected non-textile sectors resulting in increased private sector investment, firm growth and job creation. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Improving the Business Environment:(Cost $3.56 M) Supporting Economic Diversification:(Cost $8.95 M) Project Implementation:(Cost $2.04 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Satisfactory  Satisfactory Overall Implementation Progress (IP)  Satisfactory  Satisfactory Overall Risk Rating  --  Moderate 12/19/2014 Page 1 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) Implementation Status and Key Decisions The Second Private Sector Competitiveness and Economic Diversification Project (PSCEDP II) is a US$13.1 million operation which was approved by the World Bank Board on October 31, 2013 and declared effective on January 9, 2014. In spite of the political uncertainty in Lesotho, the project implementation has been progressing well towards achieving its development objectives. The project had disbursed US$2.2 million to date. The project is making good implementation progress in its various subcomponents as detailed under each component. Under component 1, The Industrial licensing bill was enacted and published in September 2014 as Industrial Licensing Act Number 10 of 2014. The related regulations and schedules to implement this new law were also published in October, 2014. The Credit Bureau has been launched and the credit providers are submitting information to the bureau. The procurement for the automation of the Construction Permit System is underway and should be commenced in the first half of next year post the legal review being undertaken. Negotiations are being undertaken with the preferred vendor to design the automated moveable collateral registry. Under component 2, The GoL has hired a firm to conduct the pre-feasibility study on pilot commercialization of industrial estates in Lesotho. The consultants are expected to embark on stage 2 of the assignment which will inform the drafting of National Pre-feasibility Analysis of Demand, Market, Investment Climate and PPP Framework for Commercial Industrial Space. A Technical Advisor for LNDC has been appointed and is expected to commence work in January, 2015 for a period of one year. The Advisor is expected to help build capacity of LNDC to implement the diversification strategy and to facilitate the missing linkages between the foreign owned firms and the local economy with an aim to improve the capacity of local businesses and potentially build a pipeline of domestic service providers opening new markets for local businesses thereby creating new and improved jobs. The design and programming of the online tourism statistics system were completed in August, 2014 and the system was tested in September 2014 as data was being uploaded, and the on-line database was launched in October, 2014. A Handcrafts and Tourism Sector Development Support Specialist is working with artisans to help them diversify products and improve their designs in order to have collections that are marketable in the international market. The consultant has also invited three designers: two from India for basket and textiles designs respectively, while the other is from France for Jewelry design. The consultant will also facilitate an excursion by National Geographic to promote Lesotho’s handicrafts sector while at the same time marketing the country internationally. The creation of an innovative tourism information center and handcrafts marketplace which is sustainable entails defining a public private partnership to assure that various stakeholders benefit transparently and over the long term. To enable such a PPP, a consultancy to draw upon international and local good practices is being undertaken. The farmers from the Mahobong roll out site have been incorporated into a company named Likhothola Fruit Farm Company. The project team should be commended for the effective installation and maintenance of physical infrastructure (netting and irrigation infrastructure). The overall health and new growth of the trees are very good, and it is anticipated that the rollout will have an estimated revenue of approximately LSL700,000 – 800,000 during the 2014/2015 season. New Sites Selection: A very thorough criterion for site selection was developed and used. The Project team has prepared a GIS map that profiles the geographical areas where investments on commercial horticulture can be made for the selected tree crops. The three key criteria used for mapping the suitability of fruit crop production in the profiled areas are the altitude, rainfalls and soil conditions. With the existing GIS map, the Project was able to transparently and clearly discuss with potential applicants the suitability of any area in the country where they wish to invest using Project funds. With the GIS map, the Project has made a significant contribution beyond the Project and project beneficiaries as it is a good basis to inform the Government of Lesotho and potential private sector investors on the suitability of the different areas in the country for fruit tree cropping. A total of 60 applications have been approved to date under the LEAP subcomponent of the new project since January 2014. In monetary terms, LEAP has cumulatively approved grants totalling $60,554 for 55 applications, of which $48,708 been disbursed to 46 clients that completed implementation of their activities . 12/19/2014 Page 2 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  --  Moderate Macroeconomic  --  --  Low Sector Strategies and Policies  --  --  Low Technical Design of Project or Program  --  --  Low Institutional Capacity for Implementation and Sustainability  --  --  Moderate Fiduciary  --  --  Low Environment and Social  --  --  Low Stakeholders  --  --  Moderate Other  --  --  -- Overall  --  --  Moderate Results Project Development Objective Indicators PHINDPDOTBL  Direct project beneficiaries (Number, Core) Baseline Actual (Previous) Actual (Current) End Target 12/19/2014 Page 3 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) Value 0.00 -- -- 75000.00 Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDPDOTBL  Female beneficiaries (Percentage, Core Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 -- -- 30.00 Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDPDOTBL  Increase in jobs created in selected non-textile sectors (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 6058.00 -- -- 40.00 Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDPDOTBL  Increase in domestic enterprises created/registered in non-textile sectors (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 11382.00 -- -- 30.00 Date 04-Sep-2013 -- -- 31-Oct-2018 Overall Comments These indicators will be tracked in the next ISR given the early implementation stage the project is at, currently. Intermediate Results Indicators 12/19/2014 Page 4 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) PHINDIRITBL  Decrease in the number of days required to obtain a construction permit from the Maseru City Council. (Days, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 106.00 -- -- 65.00 Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDIRITBL  Credit Bureau established and operational. (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- Y Y Date 04-Sep-2013 -- 08-Dec-2014 31-Oct-2018 PHINDIRITBL  Increase in non-textile investments in the industrial estates. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 418.50 -- -- 50.00 Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDIRITBL  Coverage of registered lodging operations under the star grading system (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- -- Y Date 04-Sep-2013 -- -- 31-Oct-2018 12/19/2014 Page 5 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) PHINDIRITBL  Tourism information center established and operational (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N -- -- Y Date 04-Sep-2013 -- -- 31-Oct-2018 PHINDIRITBL  Increased incomes of participating farmers. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value -- -- -- 30.00 Date -- -- -- 31-Oct-2018 PHINDIRITBL  Share of firms supported by LEAP that increased sales by greater than 10% after a year of support. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value -- -- -- 30.00 Date -- -- -- 31-Oct-2018 Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P144933 IDA-53090 Effective XDR 8.70 8.70 0.00 1.48 7.22 17% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P144933 IDA-53090 Effective 31-Oct-2013 21-Nov-2013 09-Jan-2014 30-Apr-2019 30-Apr-2019 12/19/2014 Page 6 of 7 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Second Private Sector Competitiveness and Economic Diversification Prj (P144933) Cumulative Disbursements Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 12/19/2014 Page 7 of 7 Public Disclosure Copy