PROJECT APPRAISAL REPORT September 2012

Transcription

1 AFRICAN DEVELOPMENT FUND PROJECT : ECCAS Institutional Capacity Building Support (PARCI-ECCAS) MULTINATIONAL: Economic Community of Central African States (ECCAS) PROJECT APPRAISAL REPORT September 2012 Appraisal Team Sector Director: Mr. Isaac Lobe Ndoumbe, Director, OSGE Regional Director: Mrs. M. KANGA, Director, ORCE Sector Manager: Mr. J-L. BERNASCONI, Manager, OSGE.1 Team Leader: Mr. A. AMOUMOUN, Principal Governance Expert, OSGE.2

2 TABLE OF CONTENTS I. Strategic Thrust and Rationale Project Linkages with the Regional Integration Strategy and Objectives Rationale for Bank s Involvement Aid Coordination... 3 II Project Description Project Components Technical Solutions Retained and Other Alternatives Explored Project Type Project Cost and Financing Arrangements Project Target Area and Beneficiaries Participatory Process for Project Identification, Design and Implementation Consideration of Bank Group Experience and Lessons Learnt Reflected in Project Design Key Performance Indicators... 9 III Project Feasibility Economic and Financial Performance Environmental and Social Impact IV Implementation Implementation Arrangements Monitoring Governance Sustainability Risk Management Knowledge Development V Legal Framework Legal Instrument Conditions Associated with Fund Intervention Compliance with Bank policies VI Recommendation Appendix I. Comparative Socio-Economic Indicators of ECCAS Appendix II. Table of the Bank Group s Portfolio of Multinational Operations in Central Africa as at 30 June 2012 (in UA million) Appendix III Major Related Projects Financed by the Bank and Other Development Partners of ECCAS Appendix IV. Map of the Project Area

3 LIST OF TECHNICAL ANNEXES ANNEX A: DEVELOPMENT AGENDA, SECTOR OVERVIEW AND DONOR SUPPORT A1 Development Agenda A2 Sector Overview A3 Donor Support ANNEX B: SUPPORTING ANALYSIS OF THE KEY ARGUMENTS OF THE REPORT B1 Main Lessons B2 Detailed Project Costs B3 Implementation Arrangements (details) B4 Financial Management and Disbursement Arrangements (details) Financial Management Arrangements (details) B5 Procurement Arrangements (details) B6 Audit Arrangements (details) B7 Environmental and Social Analysis B9 Project Preparation and Supervision ANNEX C: OTHER TECHNICAL ANNEXES C1 Detailed Description of Project Components C2 List of Financing Criteria for RPGs LIST OF TABLES No. Title Page 1.1 Support of Technical and Financial Partners for ECCAS Capacity-Building (in CFA.F million) Project Components Alternative Solutions Considered and Reasons for their Rejection Estimated Costs by Component Project Costs by Expenditure Category Sources of Financing Expenditure Schedule by Expenditure Category Expenditure Schedule by Component Monitoring Stages/Feedback Loop Risks and Mitigation Measures 15 i

4 Currency Equivalents September 2012 UA = CFA.F UA = EUR UA = USD Fiscal Year 1 January 31 December Weights and Measures 1 metric tonne = 2204 pounds 1 kilogramme (kg) = 2,200 1 metre (m) = 3.28 feet 1 millimetre (mm) = inches 1 kilometre (km) = 0.62 miles 1 hectare (ha) = acres ii

5 Acronyms and Abbreviations ACBF ADF AMU AU CAADP CEMAC CEN-SAD CET CIC CIDA COBAC COMESA COMIFAC COPAX DIPEM ECA ECCAS ECOWAS EU FCD FOMAC FTA GDP IGAD ITC MARAC MIP NEPAD NEPAD-IPPFF PACT II PAP PAPS PARCI-ECCAS PDCT-AC PIDA PIU PSC REC REG REP RIS RISP SADC STP UDE UDEAC UNDP UNECA US African Ccapacity Building Foundation African Development Fund Arab Maghreb Union African Union Comprehensive Africa Agriculture Development Programme Central African Economic and Monetary Community Community of Sahel-Saharan States Common External Tariff Community Integration Contribution Canadian International Development Agency Banking Commission of Central Africa Common Market for East and Southern Africa Central African Forestry Commission Council for Peace and Security in Central Africa Department in charge of Physical, Economic and Monetary Integration Economic Commission for Africa Economic Community of Central African States Economic Community of West African States European Union Community Cooperation and Development Fund Central African Multinational Force Free Trade Area Gross Domestic Product Intergovernmental Authority on Development International Trade Center Central African Early Warning System Minimum Integration Programme New Partnership for Africa s Development NEPAD Infrastructure Project Preparation Facility Programme for Building African Capacity for Trade Priority Action Programme Support Programme for Peace and Security in Central Africa ECCAS Institutional Capacity-Building Support Project of ECCAS (PARCI-ECCAS) Central African Consensual Transport Master Plan Programme for Infrastructure Development in Africa Project Implementation Unit Project Steering Committee Regional Economic Community Republic of Equatorial Guinea Regional Economic Programme Regional Integration Strategy Regional Integration Strategy Paper Southern African Development Community Sao Tome and Principe Equatorial Customs Union Central African Customs and Economic Union United Nations Development Programme United Nations Economic Commission for Africa United States iii

6 Project Information Sheet Client Information DONEE : Economic Community of Central African States (ECCAS) EXECUTING AGENCY : ECCAS General Secretariat Financing Plan Source Amount (UA million) Instrument ADF (regional RPG budget) 7.00 Grant ECCAS 1.23 Counterpart Funds TOTAL COST 8.23 Key Financing Information on ADF Grant Grant Currency Interest* Type Interest Rate Spread* Service Charge* Other Charges* Tenor Grace period FRR, NPV (baseline scenario) ERR (baseline scenario) UA NA NA NA NA NA NA NA NA Timeframe Main Milestones (expected) *if applicable Concept Note Approval August 2012 Appraisal September 2012 Regional Team October 2012 Project Approval December 2012 Effectiveness January 2012 First Disbursement March 2013 Last Disbursement December 2016 Completion March 2017 iv

7 Project Summary Project Overview Beneficiaries The ECCAS Institutional Capacity Building Support Project (PARCI-CEEAC) falls within the framework of the Bank s Regional Integration Strategy Paper (RISP, ) for Central Africa, the main pillars of which is focused on capacity-building for the Central African Economic Community (ECCAS). Its objective is to promote regional integration in Central Africa by building ECCAS institutional, human and operational capacity to implement regional programmes and the harmonization of sector policies. It aims to enhance performance in the preparation and implementation of regional infrastructure programmes by building institutional capacity. It also contributes to the improvement of intra-regional trade by supporting the streamlining ECCAS and CEMAC sector policy initiatives. The project cost is UA 8.23 million, jointly financed by the ADF (UA 7 million) and ECCAS (UA 1.23 million). It will be implemented over a four-year period from 2013 to The project s main direct beneficiaries are the ECCAS General Secretariat of ECCAS, the CEMAC Commission and the Technical Secretariat of the Central Africa-REC Rationalization Committee that will participate in studies and in other activities planned under the rationalization and harmonization of regional policies and standards. Consultations were held with stakeholders during project preparation. The participatory process will be maintained during project implementation using an implementation framework involving all beneficiary structures. Ownership of the planned institutional reforms will be ensured through ECCAS participatory decision-making process involving all Member-States. Needs assessment The project will ensure the continuation of ECCAS capacity-building activities which are necessary for the efficient implementation of regional infrastructure programmes and the harmonization of sector policies. Indeed, ECCAS is faced with several institutional, human, organizational and financial constraints that undermine the efficiency, impact and visibility of its action. It will also ensure the concrete implementation of the ECCAS and CEMAC activities rationalization process of which the Bank is a key partner. Bank s Added- Value Knowledge Management This operation comes at the right time to help address challenges that require bold responses at the strategic, institutional and operational levels, in order to help Central Africa to catch up with other parts of the continent in terms of regional integration. Indeed, the Bank, more than any other partner, is engaged in supporting RECs to implement the integration process in accordance with its mandate. Implementation of this project will lead to the development of several types of knowledge, including the capacity to analyze and adapt the institutional framework of RECs, the development of a statistical tool for monitoring the implementation of regional infrastructure, and harmonization of the trade policies of ECCAS and CEMAC which are two communities in the same region with different levels of liberalization for their respective domestic markets. The technical assistance provided for under the project will promote the transfer of knowledge to the institution through the deployment of counterpart experts. Lessons learnt from project implementation will be disseminated through validation and dissemination of the studies produced. The knowledge and lessons learned will be disseminated within the Bank. v

8 OUTPUTS OUTCOMES IMP ACT Results-based Logical Framework Country and Project Name : Multinational ECCAS - Institutional Capacity Building Support Project (PARCI-ECCAS) Project Goal : Promote regional integration in Central Africa by building ECCAS institutional, human and operational capacity to implement regional programmes and harmonization of sector policies. RESULTS CHAIN Consolidation of economic growth in the Central African region Outcome 1: Implementation of regional projects/programmes is better coordinated and more efficient Outcome 2: Intra-regional trade strengthened. Indicator (including CSIs) PERFORMANCE INDICATORS Baseline Situation Target MEANS OF VERIFICATION Economic growth rate of the ECCAS area 4.5% in % in 2020 ECCAS, UNECA and ADB reports Disbursement rate of projects/programmes coordinated by the ECCAS General Secretariat 5% in % in 2016 ECCAS reports Regional CPPR Share of intra-community trade in the region's total trade 1 % in % in 2016 ADB statistics (ESTA) Component I: Supporting improvement of the institutional framework and monitoring/evaluation of regional infrastructure development projects/programmes Output 1.1: The legal and institutional framework of the GS is strengthened Output 1.2: The operational and financial management mechanism of the General Secretariat is strengthened Output 1.3: The infrastructure projects in the PIDA Priority Action Plan are in an advanced stage of preparation Output 1.4: The statistics unit of ECCAS is operational and the infrastructure and trade databases are available The texts (Treaty, IR, SR and FR) are revised Establishment of a RB strategic framework Level of preparation of the 12 PIDA- PAP projects Regional statistical development strategy Regional infrastructure database External trade database Outdated fundamental texts Non-existent Stage S1 (identification phase) Non-existent non- Almost existent Component II: Supporting the harmonization of regional integration policies and instruments Output 2.1: Harmonization of the CET of CEMAC/ECCAS and of the common customs code are at an advanced level of implementation Output 2.2: The COPIL TS is operational Capacity for steering the CEMAC and ECCAS rationalization process is strengthened Level of harmonization of the CET of CEMAC/ECCAS ECCAS/CEMAC customs codes harmonized A permanent CEMAC/ECCAS coordination, exchange and validation mechanism for the harmonized monitoring of regional policies and programmes The organizational framework of the ST is established and operational Number of COPIL TS staff trained including the number of COPIL TS women trained non- Almost existent Harmonization underway Customs codes not harmonized in 2011 Non-existent Embryonic in 2012 Low-skilled experts Texts revised in 2015 RB strategic framework adopted in 2016 The 12 projects of PIDA-PAP are in the S2 level of preparation (feasibility studies done) including at least 4 projects in the S4 stage (implemented) in 2016 Strategy available in 2014 Regional infrastructure database available before the end of 2015 External trade database available before the end of 2015 CET harmonized at the end of 2015 Common customs code adopted in 2016 Harmonized monitoring mechanism established in 2014 Organizational framework of ST COPIL established in 2014; 16 COPIL TS experts trained, including at least 4 women, for Adoption instruments/decision s ECCAS Report Adoption instrument/decisions Regional PIDA monitoring reports ECCAS Report ECCAS Report ECCAS and ADB reports ECCAS and ADB reports RISKS/ MITIGATION MEASURES Risk 1. Low level of ownership by member States as reflected in the delays in CIC payments and difficulties in holding summits Mitigation Measure 1. The revival of national coordination teams for the harmonization of RECs and the facilitation of intra-regional trade will enable ECCAS to increase its visibility substantially in other to arouse the greater interest among the Highest Authorities in Member States. Risk 2. The weakness of national structures responsible for regional integration undermines the smooth conduct of projects. Mitigation Measure 2. The future establishment of National NEPAD Coordination teams in each State, coupled with the support provided under this project will help to facilitate intraregional trade and increase the presence of the General Secretariat. Risk 3. Bottlenecks in the decisionmaking process could delay revision of the legal framework and the implementation of necessary reforms. Mitigation Measure 3. Joint action by donors, very close and coordinated monitoring of the project by headquarters as well as technical assistance provided by the Bank through other projects could help to speed up the process of reviewing ECCAS texts. Besides, the effective functioning of the Steering Committee on the Rationalization of RECs in Central Africa (COPIL/REC-CA) and the creation of the CEMAC-ECCAS Joint Committee will facilitate the execution of actions planned under the harmonization of regional integration policies and instruments. Risk 4. The weakness of the fiduciary framework cannot guarantee the transparency or rational use of financial resources vi

9 KEY ACTIVITIES Output 2.3: ECCAS has greater visibility. Output 2.4: The focal points, the NSA are sensitized to integration issues. Output 2.5: Greater ownership by member-states COMPONENTS A communication plan with the 10 member states is prepared and validated : Number of stakeholders trained including the percentage of women trained The mechanism for monitoring and acceleration of CIC collection is established No plan Low Outstanding CIC payments in 2011 Communication plan adopted 200 persons 40% of women 30% decline from 2011 to 2015 Component I: Supporting the improvement of the institutional framework and of the monitoring/evaluation of regional infrastructure development programmes - Technical assistance, equipment and training Component II: Supporting the harmonization of regional integration policies and instruments - Technical assistance, equipment and training Component III: Project management Technical assistance, operational management manuals, equipment and training ECCAS and ADB reports RESOURCES ADF loan: Mitigation Measure 4: The Bank s procedures will be used. The technical assistance provided under this project to review the texts, mechanisms as well as the programmatic and financial management processes will help to strengthen the financial management system. Indicative Cost in UA million Component I 4.50 Component II 2.96 Project 0.77 Management Total 8.23 vii

10 Board Presentation Grant Effectiveness Years Project Implementation Schedule Activities / Months N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D Prior to Start-Up Appointment of Coordinator Formation of PT Preparation of Procedures Manual Project Launching Mission Equipment and Supplies Bidding for Office Automation and IT Equipment. Procurement of Software Bidding for Other Equipment Delivery of Goods and Start-Up Consultants Preparation of BDs and SLs Issue of Invitations to Bid, Bid Analysis and Award of Contracts, Consulting Services Tech. Assist. Legal Unit Tech Assist. DISC Tech. Assistance. DIPEM Tech. Assist. COPIL Tech. Assist. PBARH Regional Consultants Recruitment of Counterparts Training Training and Other Items Operating Expenditure Mid-Term Review Monitoring-Evaluation 0 0 Tech. Coordination Committee Meetings PSC Meeting Audit Annual Audit of Accounts Final Audit of Accounts io n viii

11 BANK GROUP MANAGEMENT REPORT AND RECOMMENDATION TO THE BOARD OF DIRECTORS CONCERNING A PROPOSAL TO AWARD A GRANT TO ECCAS FOR THE INSTITUTIONAL CAPACITY BUILDING SUPPORT PROJECT OF ECCAS (PARCI-ECCAS) Management submits this report and recommendations on a proposal to award a grant of UA 7 million to the General Secretariat of the Economic Community of Central African States (ECCAS) to finance the Institutional Capacity Building Support Project of ECCAS (PARCI-ECCAS). I. Strategic Thrust and Rationale 1.1 Project Linkages with the Regional Integration Strategy and Objectives The African Union (AU) Integration Strategy derives from the Abuja Treaty to create the African Economic Community (AEC) that has been in force since May The AEC is implemented through the eight regional communities 1 (RECs) which include ECCAS, created in 1983 and comprising 10 member states 2, six 3 of which are members of the Central African Economic and Monetary Community (CEMAC), established in The Minimum Integration Programme (MIP) is the AU s general strategic framework for implementation of regional and continental integration by the RECs. PARCI-ECCAS is consistent with these AU strategic guidelines and in line with the strategic vision framework (Vision 2025) of ECCAS, adopted in 2007 "and whose main objective is to transform the region into a haven of peace, solidarity and balanced development". This Vision is also consistent with CEMAC s Regional Economic Programme (REP) for , whose objective is to build a competitive regional environment in order to attract substantial private investments to growth sectors. As concerns the Bank, it should be noted that regional integration is enshrined in its Charter and has been part of its mandate since its creation in Its intervention in multinational operations is defined under its Regional Integration Strategy (RIS) whose second pillar seeks to "build institutional capacity including trade facilitation, with a view to promoting regional integration and trade in Africa". PARCI-ECCAS falls under Pillar II of the Bank s Regional Integration Strategy in Central Africa (RISP ), which seeks to "build the institutional and human capacities of RECs" with a view to ensuring (i) greater ownership of regional infrastructure programmes; and (ii) advanced rationalization of their action especially in the harmonization of regional integration policies and instruments. This is in line with the Bank s Long-term Strategy (LTS) which makes regional integration the driver for promoting sustainable and inclusive growth in Africa by releasing the potential generated by economies that are more integrated through infrastructure and regional trade SADC, ECCAS, ECOWAS, AMU, CEN-SAD, COMESA, IGAD and EAC. Angola, Burundi, Cameroon, Central African Republic (CAR), Congo, Democratic Republic of Congo (DRC), Gabon, Equatorial Guinea (REG), Sao Tome and Principe (STP) and Chad Cameroon, CAR, Congo, Gabon, REG and Chad 1

12 1.2. Rationale for Bank s Involvement Limited infrastructure is the main constraint to more robust growth in Central Africa. The AU, in partnership with the ECA, the Bank and the NEPAD Planning and Coordination Agency, designed a Programme for Infrastructure Development in Africa (PIDA). This continent-wide initiative, which relies on regional projects and programmes, will help to address the infrastructure shortage which hampers Africa s competitiveness on the world market. ECCAS is recognized as the REC that should coordinate NEPAD and the Priority Action Plan of PIDA (PAP-PIDA) in Central Africa. Regional infrastructure development is one of the two pillars of RISP. RISP highlighted the weak institutional and human capacities of ECCAS and CEMAC, especially in the design of regional programmes as well as the harmonization and dissemination of community standards. These constraints are evident, inter alia, in: (i) the limited cooperation between the two institutions that affects the implementation of the regional integration agenda; and (ii) the lack of harmonization of standards which hampers the free flow and facilitation of transport. Furthermore, ECCAS which is recognized as the REC responsible for coordinating NEPAD and PIDA_PAP in Central Africa, faces several institutional, human, organizational and financial constraints that include: (i) outdated fundamental texts that are not adapted to the current missions of the institution and to modern management; (ii) shortage of human resources and the lack of a performance-based human resource management system; (iii) the lack of budget and investment management following a results-based programmatic approach; and (iv) poor coordination between headquarters and member-states. It also faces the problem of irregular payment of the Community Integration Contribution (CIC) by certain member states. 4 These structural constraints negatively affect the efficiency, impact and visibility of its action Besides, Central Africa s integration agenda considerably lags behind that of other RECs (ECOWAS, COMESA, etc.). The opening of the Free Trade Area (FTA), scheduled for 2004, is still not effective. Limited ownership of regional market instruments by national and community administrations is reflected, inter alia, in the limited intra-regional trade within both CEMAC and ECCAS (1% of total trade). It has also been noted that tariff and non-tariff barriers continue to hamper trade in the region. CEMAC and ECCAS treaties and conventions contain, in their related protocols, provisions defining community policies on trade and laying down the rules, instruments and mechanisms of trade cooperation. Yet one of the specificities of market systems is that they are mutually exclusive whenever their parameters are not coordinated. Without harmonization, selection of one of the regimes will systematically exclude the instruments of ECCAS' FTA or ECCAS' Customs Union. Maintenance of a dual trade policy (even partially) by CEMAC and ECCAS deprives economic operators and national governments of visibility. Harmonizing standards is a prerequisite to the optimization of the Central African market. That is why ECCAS and CEMAC currently lay emphasis on rationalization, pursuant to the decision of the 13th Conference of ECCAS Heads of State, held in October 2007, inviting the two RECs to "set up a Steering Committee comprising the AU, ECA and the ADB to prepare a roadmap, defining the actions for harmonization of the integration policies and instruments of both Communities, in order to end up with a single REC in the Central African region". 5 However, the Technical Secretariat of COPIL, which has been set up, has very limited institutional capacity and lacks the resources to prepare the rationalization roadmap. 4 5 However, it should be noted that there are encouraging prospects with the decision of the Conference of Heads of State held in January 2012, requesting the General Secretariat to apply the sanctions provided under the Treaty for non-payment of contributions. 13th Conference of ECCAS Heads of State and Government, Brazzaville, October

13 1.2.3 Why the Bank Group has to intervene: In accordance with AU guidelines, the Bank contributes to the implementation of the integration strategy in Central Africa through ECCAS. Hence, the current operation is justified for three main reasons. First of all, there is need to continue with and complete the capacity-building actions initiated under completed or on-going Bank operations (cf. Appendix II). It should be recalled that the first institutional support project started in 2006, at the time when ECCAS was emerging from a long period of lethargy characterized by institutional instability, very limited ownership by member-states and staff demobilisation due to irregular payment of salaries. Although the results were satisfactory on the whole, the diagnosis 6 conducted under PAI-SG, confirmed by the conclusions of the EU s 4-pillar audit, 7 reveals enormous capacity-building needs that have not yet been addressed, especially as regards review of the legal framework, monitoring of sector policies and results-based management. Secondly, the Bank is a key partner of ECCAS as regards capacity-building and rationalization of Central Africa s RECs. Indeed, the project will make it possible to continue with harmonization activities piloted by COPIL/REC, whose TORs were prepared with joint financing from the Bank and Sub-regional Office for Central Africa of the UN Economic Commission for Africa (ECA/SRO-CA) in 2011, focusing on the 12 priority areas of rationalization. Lastly, this project will help to create conditions conducive to the implementation of the two RISP pillars, 8 mainly by building capacity for the implementation of regional infrastructure development programmes featured in the PIDA-PAP. It will also make it possible to build ECCAS capacity for more effective monitoring-evaluation of integration programmes and the harmonization of sector policies. The analysis that led to classification of the project as a regional public good, in accordance with the criteria for prioritizing regional operations, is presented in Annex C2 of the technical annexes. Indeed, given its multinational character (spanning two RECs and 10 countries) and the effects of positive externalities on other communities, the project constitutes a regional public good whose benefits will ultimately be shared by a great number of countries Aid Coordination Technical Annex A3 provides details of TFP regional integration operations in Central Africa. TFP coordination in both regional organizations remains limited. There is no operational structure for coordinating and monitoring donor operations. Nevertheless, periodic meetings between donors enable them to exchange ideas and share information with a view to coordinating and rationalizing their operations. Participation in the project's steering committee by TFPs (EU, ECA) involved in institutional capacity-building will enable ECCAS to strengthen the coordination and harmonization of its support. Furthermore, project support to the setting up of a results-based programmatic management framework within the GS, will in the long run provide ECCAS with a tool for integrated resource programming and, consequently, an aid coordination instrument Institutional and Operational Diagnosis Report of ECCAS, 2008 Accounting, Audit, Procurements and Control References: ADF/BD/WP/2009/153/Rev.1 3

14 Table 1.1: Support of Technical and Financial Partners for ECCAS Capacity-Building (in CFA.F million) Projects ADF ACBF Status Institutional support to the General Secretariat of ECCAS (PAI-SG) Completed in 2010 Capacity-building for the ECCAS General Secretariat (RENFOR) Completed in 2009 Capacity-building for Central African Members of Parliament (REPAC) 750 On-going Aid Coordination Level Existence of thematic working groups No Existence of a global sector program No ADB s role in aid coordination None II. Project Description 2.1 Project Components The project s overall objective is to promote regional integration in Central Africa by building ECCAS institutional, human and operational capacity to implement regional programmes and harmonizing sector policies The project s specific objectives are to: (i) build the institutional capacity of the General Secretariat to ensure better implementation of regional programmes and greater ownership of the regional integration agenda; and (ii) support the implementation of the rationalization process for Central Africa s RECs with a view to harmonizing their integration policies and instruments and facilitating intra-regional trade. The project has three components: (i) Supporting the improvement of the institutional framework and monitoring/evaluation of regional infrastructure development programmes; (ii) Supporting the harmonization of regional integration policies and instruments; and (iii) Project management and coordination. Implementing these components which are complementarity, contributes to the achievement of the project objective. Indeed, improvement of the organizational and operational capacities of the ECCAS General Secretariat will enable the institution to strengthen its role of coordinating regional programmes and driving Central Africa s integration agenda through synergy of action with CEMAC in the area of harmonization of community policies and standards. A summary of project components and activities is presented below: 4

15 Components 1. Supporting the improvement of the institutional framework and of the monitoring/evaluation of regional infrastructure development programmes 2. Supporting the harmonization of regional integration policies and instruments Total cost (UA Million) Table 2.1: Project Components Description of Components 1.1 Institutional and organizational capacity-building for the GS of ECCAS Support to the Legal Unit and revision of texts; Capacity-building for DISC (including support for implementation of the gender policy) Support for the implementation of results-based programmatic management 1.2 Building the implementation and monitoring capacity of infrastructure projects Support to the Surface Transport Service (roads, rail, ports) Support to the Water and Air Transport Service Support to the Energy Unit Support to the Information and Communication Technology (ICT) Service 1.3 Strengthening of the regional statistics system Support to the development of regional external trade statistics Strengthening of the infrastructure statistics system Establishment of a statistical and economic analysis system Support to the preparation of a Regional Statistical Development Strategy 2.1 Implementation of the ECCAS/CEMAC Rationalization Programme Studies on the harmonization of ECCAS and CEMAC trade policies Operationalization of the ECCAS/CEMAC Joint Committee on nomenclature, tariffs and legislation Preparation and follow-up of the Annual Forum on Rationalization of the RECs in CA Validation, publishing and dissemination of the Regional Customs Code Rationalization Communication Plan and the ECCAS/CEMAC exchange and consultative mechanism 2.2. Institutional support to the COPIL Technical Secretariat Logistical support Technical assistance for the operationalization of COPIL TS Human resources capacity-building Operational support 3. Management and coordination 2.3 Strengthening of cooperation between the GS of ECCAS, member-states and the Institutions Support to the preparation and implementation of the Communication Plan Study of the organizational framework and establishment of mechanisms to speed up collection of the Community Integration Contribution (CICI) from member states Awareness-raising programme for non-state actors (CSOs and private sector) in the States Management 3.2 Audit 5

16 2.1.3 Technical Annex B2 provides the detailed costs of project activities by component. Furthermore, Technical Annex C1 gives a detailed description of project activities, indicating for each sub-component: (i) the context and challenges to be addressed; (ii) the actions implemented by the project; and (iii) expected results. 2.2 Technical Solutions Retained and Other Alternatives Explored Although the causes of ECCAS human and financial resource constraints certainly stem from inadequate management mechanisms, they are also structural. To address these difficulties, institutional reforms are necessary. At the same time, the institution badly needs capacity-building to be able to implement its integration agenda in the priority domains such as infrastructure development, harmonization of sector policies and regional trade facilitation. Hence, the approach adopted by the project entails tackling structural problems by reviewing the institutional framework (revision of the fundamental texts, establishment of a strategic framework and a results-based medium- and long-term action plan) and providing technical assistance that can build the institution s existing capacity so that it can implement its work programme in key areas (infrastructure, trade, statistics, programming). Table 2.2: Alternative Solutions Considered and Reasons for their Rejection Alternative Solutions Brief Description Reasons for Rejection Establishment of a young To address the shortage of human resources Solution not sustainable without an adequate human professionals programme at the GS of ECCAS, there were plans to resource management policy Include, within project, support to certain specialized entities (COMIFAC, COBAC) Project Type set up a young professionals programme Under RISP, there are plans to build the institutional capacities of ECCAS, CEMAC and COMIFAC The project targets the rationalization of CEMAC and ECCAS. Including other entities could create the risk of dissipation of Bank intervention without tangible results. Key support could be envisaged directly for these entities at the proper time PARCI-ECCAS is an institutional support project which, through its regional dimension and its objectives, contributes to the promotion of a Regional Public Good. Indeed, it fulfils the conditions defined in the Strategic and Operational Framework for Regional Operations (2008) as well as the seven eligibility criteria for Regional Public Goods (cf. Annex C2). The choice of an operation in the form of institutional support is justified by the nature of the planned activities (technical assistance, studies, training) which, furthermore, will be implemented in several institutions. Through institutional support, the Bank also hopes to strengthen synergies with the support of other TFPs involved in the capacity-building of structures responsible for implementing the institutional reforms targeted by this project. 2.4 Project Cost and Financing Arrangements The total project cost, including customs duties and taxes, is estimated at UA 8.23 million (or approximately CFA.F 6.62 billion at the exchange rate of September 2012), comprising UA 5.04 million in foreign exchange (61.24%) and UA 3.19 million in local currency (38.76%). The costs include a 2% provision for physical contingencies and a 3% provision for price escalation per year for expenditure in both foreign exchange and local currency. A detailed table of costs is presented in Technical Annex B2 of this report. The table below provides a summary of total project costs by component. 9 Banking Commission of Central Africa 6

17 Table 2.3: Estimated Costs by Component COMPONENTS USD thousands Total Cost in UA thousand % F.E. F.E. L.C. Total F.E. L.C. Total 1. Supporting the improvement of the institutional framework and monitoring/evaluation of regional infrastructure development programmes Institutional and organizational capacity-building for the GS % Building the implementation and monitoring capacity of infrastructure projects % Strengthening of the regional statistics system % Baseline cost Component I % 2. Supporting the harmonization of regional integration policies and instruments Implementation of the ECCAS/CEMAC Rationalization Programme % Institutional support to the COPIL Technical Secretariat % Strengthening of coordination between ECCAS, member States and other institutions % Baseline cost Component % 3. Management and Coordination Project Management % Audit % Baseline cost Component % TOTAL BASE COST % Physical Contingencies % Price escalation % TOTAL PROJECT COST % NB: The exchange rates used are indicated in the introduction to this report (page (i)) Table 2.4 presents estimated project costs by expenditure category, while Table 2.5 presents an analysis of sources of financing and Tables 2.6 and 2.7 provide the expenditure schedule by expenditure category and by component. Table 2.4: Project Cost by Expenditure Category, (in UA thousand) EXPENDITURE CATEGORIES F.E. L.C. Total % F.E. GOODS % SERVICES % OPERATION % TOTAL BASE COST % Physical Contingencies % Inflation % TOTAL COMPONENT COST % Category/Sources of Financing Table 2.5: Sources of Financing [amounts in UA million] 7 ADF ECCAS Total UA million % UA million % 1. Supporting the improvement of the institutional framework and of the monitoring/evaluation of regional infrastructure development programmes % % Supporting the harmonization of regional integration policies and instruments % % Project management % % 0.77 Total % % 8.23 UA million The project will be co-financed by an ADF grant of UA 7 million (85% of the total cost) and by ECCAS counterpart contribution of UA 1.23 million, or 15% of the project cost. The counterpart funds will earmarked for procurement of equipment and operational expenses.

18 Table 2.6: Expenditure Schedule by Expenditure Category, [in UA thousand] EXPENDITURE CATEGORIES Total GOODS SERVICES OPERATION TOTAL Table 2.7: Expenditure schedule by component (in UA thousand) COMPONENTS Total 1. Supporting the improvement of the institutional framework and of the monitoring/evaluation of regional infrastructure development programmes Supporting the harmonization of regional integration policies and instruments Project management TOTAL COST Project Target Area and Beneficiaries The project area comprises the territory of ECCAS member-states. Indeed, the activities of PARCI-ECCAS will concern the services of the General Secretariat, but also the Technical Secretariat of COPIL-CER-AC, the CEMAC Commission in Bangui (CAR), the Regional Coordinations of NEPAD, ECCAS focal points in the countries, customs services and the Ministries in charge of trade and regional integration in the 10 ECCAS member states The main direct beneficiaries of the Project are: (i) the GS of ECCAS; (ii) COPIL TS; (iii) the CEMAC Commission that will be involved in studies and other rationalization activities to be conducted under the second component of the project. The indirect beneficiaries of the project are the people of these countries, women, youths, the private sector and especially SMEs and the informal sector that will operate within a more favourable statutory framework of regional trade and certainly benefit from basic infrastructure. Indeed, businesses could benefit from the growth opportunities in intra-community trade that ensue from the trade rationalization and facilitation activities supported by the project through unified approval procedures, a harmonized regional customs code and more efficient market information systems. 2.6 Participatory Process for Project Identification, Design and Implementation During project identification, a consultative process was established through exchanges between the ADB, the relevant ECCAS departments and donors. These consultations continued during preparation and appraisal missions to ensure greater ownership of the project. The project appraisal mission held discussions with the TS of COPIL-CER-AC in Yaoundé and the CEMAC Commission in Bangui. Similarly, the ECA contributed to project design through review of the concept note and discussions that the project team held with BSR-CEA in Yaoundé at appraisal. The participatory process will be maintained during project implementation through the steering committee (including civil society) and internal mechanisms for consultations with States. The project supports the revision 8

19 of ECCAS fundamental texts that will be adopted in accordance with the applicable decision-making process of ECCAS (after review by the Internal Committee of the GS, the Member-States Committee of Experts, Council of Ministers, Conference of Heads of State). The project will also support communication and awareness-raising actions directed at member-states in order to ensure greater ownership of integration objectives in the countries. The project contributes to building the capacity of the department in charge of infrastructure (DIPEM), and social and trans-border migration issues have been factored into the design of regional infrastructure projects. 2.7 Consideration of Bank Group Experience and Lessons Learnt Reflected in Project Design Annex B1 in the technical annexes analyses the main lessons learnt from previous projects. The completion report 10 of PAI-SG shows that the project has achieved generally satisfactory results with a score of 3 out of 4. Despite its implementation delays, the project has led to, inter alia, the conduct of an institutional and operational diagnostic study of ECCAS and the adoption of a new organization chart, the definition and implementation of priority programme activities in the areas of NEPAD and statistics, an update of the accounting for FY as well as the procurement of equipment. The abovementioned diagnostic study as well as the study on Audit 4 pillars conducted by European Union in 2010 clearly demonstrated that revision of ECCAS fundamental texts (Treaty, Staff Regulations, Internal Rules and Financial Rules) was indispensable in order to ensure the effective operationalization of the new organization chart as well as the adoption of a governance system that is consistent with international accounting standards and results-based management The main lesson learnt from the project is the need to factor into the Bank s future operations, the fact that ECCAS has weak project implementation capacity due to its inadequate human resources. Furthermore, in 2010 NEPAD s Infrastructure Project Preparation Facility (IPPF) spent USD 1,098,000 to finance an institutional support project for the implementation and monitoring of the Central African Consensual Transport Master Plan (PDCT-AC) by ECCAS. This project, which is being completed (46% disbursement rate), contributes to the implementation actions of PIDA s Priority Action Plan in Central Africa. Lastly, the lessons learnt from review of the Bank s portfolio of multinational operations, conducted in 2010, highlighted the need to: (i) continue with efforts to build RECs capacities to improve programme implementation and design sustainable resource mobilization mechanisms; (ii) strengthen coordination with other TFPs by focusing on joint financing; (iii) focus on selectivity to generate a greater impact in the development of the region; and (iv) pursue and step up dialogue with countries to ensure greater ownership of multinational projects. The lessons learnt from the previous operation and from portfolio review were factored into project design. Indeed, a selective approach was used to choose capacity-building actions for RECs, supported by participatory dialogue with all stakeholders that will continue during implementation. Furthermore, discussions with other TFPs led to better targeting of operations in order to avoid duplication and overlap. 2.8 Key Performance Indicators The project s key performance indicators are presented in the logical framework on Page viii. The main expected achievements and outcomes of the project are: 10 References ADF/BD/IF/2011/124 9

20 Box 1: Key Performance Indicators Impact indicator The economic growth rate of the CEMAC area rises from 4.5% in 2011 to 5.3% in Impact indicators The implementation rate of regional projects coordinated by the GS of ECCAS rises from 5% in 2010 to 30% in The share of intra-community trade in total regional trade increases from 1% in 2010 to 2.5% in Output indicators : The texts (Treaty, IR, SR and FR) are revised in 2015 The GS of ECCAS has a Results-based Strategic Management Plan in The 12 projects of the PIDA-PAP are in the S2 level of preparation (feasibility studies done) including at least 4 projects in the S4 stage (implemented) in CEMAC and ECCAS end up with one harmonized CET at the end of CEMAC and ECCAS use a single harmonized Regional Customs Code from COPIL TS experts, including at least 4 women, are trained during the period. CIC payments arrears decline by 30% from 2011 to III. Project Feasibility 3.1 Economic and Financial Performance Since this is an institutional support project, economic and financial analyses do not apply. However, it should be noted that due to the building of internal managerial capacity, the project could contribute to better resource management by ECCAS and more judicious use of such resources. 3.2 Environmental and Social Impact Environment The project has no direct negative environmental impact since its activities are limited to training, technical assistance, studies and the procurement of logistical resources including small-sized office automation and IT equipment. Indeed, the project was classified under category 3 in accordance with Bank Guidelines. Nevertheless, sub-component 1.2 of this project helps to build the capacity of the department in charge of infrastructure (DIPEM). The environmental component is taken into account in the preparation and implementation of various regional infrastructure projects. The Bank, through the Congo Basin Ecosystems Conservation Support Programme (PACEBCo), supports conservation of the second largest tropical forest in the world after the Amazon. This programme should provide the answers to the steady degradation of this forest and climate change. The programme duration is 5 years from March 2009 and its total cost is estimated at UA million, with an ADF grant financing of UA 32 million. In conclusion, through capacity-building, this project complements the various forms of support provided by the Bank in response to environmental degradation and climate change. Climate Change Project activities, focused on human and institutional capacity-building, have no negative impact on the environment or on the climate change process. Nevertheless, the Bank, through the Congo Basin Ecosystems Conservation Support Programme (PACEBCo) supports regional initiatives to combat climate change. 10

21 Gender The vision that defines ECCAS gender policy is that of a community in which men and women enjoy equal rights, develop their skills and thus contribute as equal partners to the building of a fair and prosperous society for all and the sustainable development of Central Africa. The establishment, within the ECCAS General Secretariat, of an adequate institutional framework endowed with the requisite authority as well as human and material resources is necessary to achieve gender policy objectives. Within this framework, the project supports capacity-building for the Department of Social and Cultural Integration (DISC) responsible for preparing and implementing ECCAS's gender policy. Supported activities relate to: (i) the preparation of the gender policy action plan; (ii) training on gender issues in regional infrastructure projects; and (iii) support to validation workshops of the Gender Action Plan. The training and sensitization component of the project will affect 40% of women. The project also supports measures that ensure efficient implementation of regional infrastructure projects to generate jobs especially for women and women s groups. Ultimately, women and youths who are mainly involved in trade will see their incomes rise owing to increased marketing of agricultural and artisanal products in the ECCAS area after the institution of the free trade area and the application of a single customs code. In summary, project actions tend to improve the living conditions and well-being of women and youths. Social The project covers 10 countries of the ECCAS area with an estimated total population of 137 million inhabitants. On average, poverty affects 63% of the population. The retained actions will lead to more efficient coordination in the implementation of PIDA action plan projects and, ultimately, the implementation of regional infrastructure projects (which will strengthen intra-regional trade and the supply of public services). The implementation rate of regional projects coordinated by the GS of ECCAS will rise from 5% in 2010 to 30% in Meanwhile, the harmonization of policies and trade policy instruments (free trade area, common customs code) will reinforce intra-community trade and generate an increase in customs revenue in the countries of the area. The share of intra-community trade in total regional trade is expected to rise from 1% in 2010 to 2.5% in This will help raise the living standards of the people In the longer-term, nationals of ECCAS member countries (including those considered to be fragile States), women, youths, private sector will certainly benefit from inclusive growth generated by the development of basic infrastructure and an environment which is more conducive to business, thanks to the harmonization of trade policies at the regional level. Indeed, project activities will help to generate employment including for women and youths. The beneficiary population is estimated at approximately 27 million (20% of the population in countries of the ECCAS area). This operation will contribute to the achievement of certain MDGs in particular combatting poverty by improving the living conditions of the people and creating jobs. Ultimately, the benefits will be shared by a large number of countries within the ECCAS area and in other regions, through the positive externalities of successful integration. Involuntary Resettlement The project will not lead to displacement of communities. 11

22 IV. Implementation 4.1 Implementation Arrangements Institutional arrangements: The institutional framework of project management is described in detail in Annex B3 of the technical annexes in this report. According to the terms of the Paris Declaration on the harmonization and alignment of project management on national systems, the project implementation organ is the ECCAS General Secretariat. A Project Team (PT) will be established within the GS that will comprise a coordinator, an accountant and support staff. The Coordinator will be an expert from ECCAS with experience in project management. He will be seconded for the duration of the project and placed under the direct responsibility of the GS. The PT will be reinforced with technical assistance recruited on a competitive basis with ADF resources and comprising: a procurements expert, a monitoring/evaluation expert, a training expert and an administrative and financial officer (AFO). These experts will also be responsible for training their counterparts, who will be experts designated by the PBARH (procurements, financial management, monitoring-evaluation, human resource management) Department A Project Steering Committee (PSC) will be set up to serve as a consultative and monitoring body for the project and to strengthen coordination. It will comprise representatives from the ECCAS General Secretariat, the CEMAC Commission, the Technical Secretariat of COPIL, UNECA and a regional civil society organization in Central Africa. It will be chaired by the ECCAS Secretary General or his representative. The PSC shall meet twice a year and whenever necessary to ensure consultation between stakeholders and project monitoring Procurements: All goods, works and services financed by the ADF shall be procured in accordance with the Bank s relevant rules and procedures on procurement (May 2008 edition, revised in July 2012), or where necessary, the Bank s rules and procedures for the recruitment of consultants (May 2008 edition, revised in July 2012), using the Bank s standard bidding documents. The project team, placed under the supervision of the Secretary General, shall be responsible for procurements and will be reinforced with one procurement expert familiar with the procurement procedures of the ADF or of other TFPs. A draft procurement plan will be prepared by the Project Team and submitted to the ADF for review and approval prior to the signing of the Grant Agreement. Details of the project s procurement arrangements are presented in Technical Annex B5 of this report Disbursement: The ADF grant will be disbursed according to the Bank s applicable procedures. The direct payment, repayment and special account methods will be used to finance activities. A special account will be opened in a commercial bank and used to finance operating expenses and staff allowances. Goods, services and audit fees will be defrayed by direct payment. Replenishment of the special account shall be subject to justification of 50% of the last advance and 100% of previous advances. Proof of the opening of the special account will be a condition precedent to first disbursement Financial Management and Audit: The overall project financial management risk was deemed to be "high" and should be brought down to "substantial" with the satisfactory application of mitigation measures (reference Technical Annex B4). The PT will be responsible for the financial, administrative and accounting management of the project. The fiduciary team will be led by the AFO. It shall keep the accounting ledgers of project activities and ensure that annual financial statements are produced on a timely basis and in accordance with the accounting principles of OHADA (Organization for the 12

23 Harmonization of Business Law in Africa) SYSCOHADA. The ECCAS General Secretariat will prepare a work programme and an annual activity budget which should be submitted to the Bank, together with annual progress reports and financial statements. It will ensure that the project's administrative, financial and accounting procedures manual to be approved by the Bank, is prepared and approved not later than three months after loan effectiveness (and prior to any disbursements). The accounting software procured by ECCAS will be configured for project needs and the accountant will be trained to use it. The annual audit of project accounts will be conducted by an approved independent accounting firm. ECCAS must submit the audit report for project accounts not later than six months after the end of each fiscal year. 4.2 Monitoring The project s physical implementation is expected to cover a period of 48 months, from January 2013 to December This schedule is deemed reasonable, given the scope of activities to be implemented and the average implementation deadlines for multinational operations. Furthermore, the use of project funds to recruit a procurements expert and a monitoring/evaluation expert should make it possible to reduce procurement deadlines and ensure appropriate monitoring of the implementation of project components. The procurement of monitoring-evaluation software and the training of project staff are also planned. A monitoring/evaluation system will be established, including easily quantifiable performance indicators, collection of baseline situation data as well as measurement of project progress towards attainment of intermediate targets and impacts The Project Team will be responsible for monitoring project implementation using logical framework indicators. As soon as the Grant Agreement becomes effective, a launching mission will be organized to train PT officials in Bank procedures. Supervision missions involving Bank offices in Gabon, Cameroon and CAR will be organized at least twice a year. Quarterly progress and annual reports will also be prepared and transmitted to the Bank. The key indicative monitoring stages are presented in the table below: Table 4.1: Monitoring Stages/Feedback Loop Schedule Stages Monitoring Activities/Feedback Loop Dec. -12 Grant approval by the Board Notification to the ECCAS General Secretariat Jan-13 Grant effectiveness Signature of grant agreement Jan-13 GPN and SPN UN Development Business; national and regional newspapers Fulfilment of conditions precedent to 1 st disbursement March -13 Proof of fulfilment of conditions submitted to the Bank Training of PT; Launching of first activities, preparation of March -13 Launching of project work programme Implementation of activities Quarterly and annual progress reports / audit reports Feb-15 Mid-term Review Mid-term review reports Dec. -16 Last disbursement Closing audit reports March 17 Project Completion Completion report 4.3 Governance The risks faced by the project management team relate to procurement decisions, the use of project assets and the selection of persons for training abroad or capacity-building. These risks will be mitigated by preparing a detailed procurement plan, establishing sound processes for contractors as well as rigorous selection of participants and applying the Bank s standard rules and guidelines. More 13

24 advanced training will be provided to project staff members to ensure that they are fully informed on the requirements and regulations. Compliance with these control mechanisms will be reviewed during supervision missions As concerns financial management of the project, the executing organ shall keep separate accounts for the project using software of international repute. This will make it possible to keep cost accounting and produce reports that show expenditure by component, category and financing source. Project accounts will be audited annually by a firm recruited for that purpose. The financial statements and audit reports will be submitted to the ADF within six months following the close of the accounting period. 4.4 Sustainability Project implementation will make it possible to enhance the institutional efficiency of the General Secretariat. The result will be a significant improvement in the design and monitoring of regional infrastructure development programmes, which is one of the major components of the integration agenda, given its expected impact on the circulation of goods and persons and on the quality and cost of communications. The project will also make it possible to factor into these programmes, the key concerns of member-state governments in the area of capacity-building for all stakeholders involved in monitoring/evaluation (enhanced regional statistics system) and the harmonization of policies. Furthermore, emphasis will be laid on the harmonization of CEMAC and ECCAS actions with a view to increasing cooperation and synergies between these two institutions in order to reach the common goal of creating a Central African common market as a prelude to the continental common market; a target set for 2020 by the AU in MIP. Attainment of project results will consequently have an obvious impact on improving the visibility of ECCAS among the peoples and authorities in Member States, which could translate into a strong attachment to the reaffirmed political will to implement the integration agenda in Central Africa The technical assistance to be provided and the training of experts from beneficiary institutions will enhance the prospect of sustaining project impact. Besides, the sustainability of project impact remains largely dependent on reform of the fundamental texts governing the functioning of the General Secretariat; aimed at developing skills mainly through the creation of a legal and regulatory framework as well as planning and management tools that enhance the efficiency of institution experts in the exercise of their duties. Ultimately, the reform will result in the establishment of strategic planning, a medium-term budgetary framework and staff regulations that lay emphasis on performancebased career management, skills and training and continuous retraining of staff that will promote the stability of experts. Similarly, the project envisages recruiting junior experts, with ECCAS counterpart funds, who will be counterparts trained by technical assistance financed by the ADF grant. This activity will enable the various structures to have the minimum capacity to define, implement and monitor sector policies, thereby become an important factor of sustainability. Lastly, as concerns recurrent costs generated by the project, it should be noted that equipment purchases only account for 3% of the total project budget. The maintenance costs for this equipment, approximately UA million per year (or 0.35% of ECCAS revenue), could easily be borne by the Institution. 14

25 4.5 Risk Management The table below presents a summary of residual risks (other than those related to governance and sustainability) as well as mitigation measures. Table 4.2: Risks and Mitigation Measures Risks Level Mitigation Measures 1. Low level of ownership by member High The revival of national coordination teams for the States as reflected in the delays in the harmonization of RECs and the facilitation of intra-regional payment of the CIC and difficulties in trade, will enable to ECCAS to increase its visibility holding summits substantially in other to arouse the greatest possible interest 2. The weakness of national structures responsible for regional integration undermines the smooth conduct of projects. 3. Bottlenecks in the decision-making process could delay revision of the legal framework and the implementation of High High among the highest ranking authorities in member States. The future creation of the National Coordinations of NEPAD and support scheduled under this project should facilitate intraregional trade and increase the presence and visibility of the GS. Close monitoring of the project as well as the technical assistance and high-level dialogue provided by the Bank during ECCAS summits could speed up the process of reviewing ECCAS texts. necessary reforms. 4. Weak fiduciary framework High The Bank s procedures will be used. The technical assistance provided under the project will help to strengthen the financial management system The above analysis shows that the project presents relatively high risk levels. Nevertheless, the achievements of ECCAS and the regional context argue in favour of Bank support to the project, given the significant results expected in terms of institutional efficiency and ownership by member countries through this operation and on-going NEPAD projects and considering the Bank s commitment to support the development of RECs within the framework of its mandate and its regional integration strategy. 4.6 Knowledge Development Implementation of this project will lead to the development of several types of knowledge, including: (i) capacities to analyses and adapt the legal framework of a REC to an institutional framework that is more compliant with international standards of administrative and financial governance; (ii) the use of statistics to monitor the construction of regional infrastructure in an environment characterized by endemically weak national systems; (iii) the definition of a harmonized trade policy between CEMAC and ECCAS, two RECs whose respective domestic markets are at different stages of liberalization; (iv) preparation of strategic plans and the introduction of results-based programmatic management in an organization with a pyramidal structure and a high concentration of decision-making powers at the top. Practices will be disseminated within the two RECs and Member States through validation and dissemination of the studies conducted, the use of developed software, procedures manuals and training sessions that will be organized under the project. This knowledge will be acquired through processes involving production of the following reports: reports of technical assistants, activity reports prepared by the executing agency, supervision reports and the project completion report. These reports will also be disseminated within the Bank. 15

26 V. Legal Framework 5.1 Legal Instrument A Grant agreement will be signed between the ADF and the Economic Community of Central African States (ECCAS) on the ADF resources, for a maximum amount of 7 million UA. 5.2 Conditions Associated with Fund Intervention o Grant effectiveness conditions: Grant effectiveness shall be subject to the signature of the Grant Agreement between the Bank, the ADF and the ECCAS General Secretariat. o Conditions precedent to first disbursement In addition to effectiveness of the Grant Agreement, the first disbursement of grant resources shall be subject to fulfilment by the Donee of the following specific conditions to the satisfaction of the Fund: (i) (ii) Provide evidence of the opening of a special account in foreign exchange in the name of the project in a bank acceptable to the Fund, to receive grant resources ( 4.1.4); Provide evidence of the appointment of a Project Coordinator whose qualifications and experience shall have been previously approved by the Fund ( 4.1.1); (iii) Provide evidence of the preparation of a manual of administrative, financial and accounting procedures for the project which shall have been previously approved by the Fund ( 4.1.5); and (iv) Provide evidence of the recruitment of an administrative and financial manager for the project whose qualifications and experience shall have been considered satisfactory by the Fund ( 4.1.5). 5.3 Compliance with Bank Policies This project complies with all the Bank s applicable policies. VI. Recommendation Management recommends that the Board of Directors approve a proposed grant of UA 7.00 million to the Economic Community of Central African States (ECCAS) to finance the Institutional Capacity Building Support Project of ECCAS (PARCI-ECCAS) subject to the conditions stipulated in this report. 16

27 Appendix I: Comparative socio-economic indicators of ECCAS Central African Republic COMPARATIVE SOCIO-ECONOMIC INDICATORS Year Central African Republic Africa Develo- ping Develo- ped Countries Countries Basic Indicators Area ( '000 Km²) Total Population (millions) , , , ,4 Urban Population (% of Total) ,2 40,4 45,5 75,4 Population Density (per Km²) ,2 36,1 59,9 36,5 GNI per Capita (US $) Labor Force Participation - Total (%) ,5 74,7 65,0 60,4 Labor Force Participation - Female (%) ,7 42,5 49,2 50,2 Gender -Related Dev elopment Index Value ,354 0,502 0,694 0,911 Human Develop. Index (Rank among 187 countries Popul. Liv ing Below $ 1.25 a Day (% of Population ,8 40,0 22,4... Demographic Indicators Population Growth Rate - Total (%) ,9 2,3 1,3 0,4 Population Growth Rate - Urban (%) ,6 3,4 2,3 0,7 Population < 15 y ears (%) ,1 40,4 28,7 16,5 Population >= 65 y ears (%) ,0 3,4 5,9 16,2 Dependency Ratio (%) ,9 78,1 53,0 48,6 Sex Ratio (per 100 female) ,1 99,5 103,4 94,6 Female Population y ears (% of total populatio ,4 24,4 26,2 23,6 Life Ex pectancy at Birth - Total (y ears) ,4 57,7 77,7 67,0 Life Ex pectancy at Birth - Female (y ears) ,0 58,9 68,9 81,1 Crude Birth Rate (per 1,000) ,7 34,5 21,1 11,4 Crude Death Rate (per 1,000) ,0 11,1 7,8 10,1 Infant Mortality Rate (per 1,000) ,6 76,0 44,7 5,4 Child Mortality Rate (per 1,000) ,4 119,5 67,8 7,8 Total Fertility Rate (per woman) ,5 4,4 2,6 1,7 Maternal Mortality Rate (per 100,000) ,0 530,7 230,0 13,7 Women Using Contraception (%) ,0 28,6 61,2 72, ,5 2,0 1,5 1,0 0,5 0, GNI Per Capita US $ Central African Republic 2010 Population Growth Rate (%) Central African Republic Africa Health & Nutrition Indicators Phy sicians (per 100,000 people) ,0 57,8 112,0 276,2 Nurses (per 100,000 people)* ,0 134,7 186,8 708,2 Births attended by Trained Health Personnel (%) ,7 53,7 65,3... Access to Safe Water (% of Population) ,0 65,7 86,3 99,5 Access to Health Serv ices (% of Population) ,2 80,0 100,0 Access to Sanitation (% of Population) ,0 39,8 56,1 99,9 Percent. of Adults (aged 15-49) Liv ing w ith HIV/AID ,7 4,3 0,9 0,3 Incidence of Tuberculosis (per 100,000) ,0 241,9 150,0 14,0 Child Immunization Against Tuberculosis (%) ,0 85,5 95,4... Child Immunization Against Measles (%) ,0 78,5 84,3 93,4 Underw eight Children (% of children under 5 y ears ,8 30,9 17,9... Daily Calorie Supply per Capita Public Ex penditure on Health (as % of GDP) ,6 2,4 2,9 7, Life Expectancy at Birth (years) Central African Republic Africa 2011 Education Indicators Gross Enrolment Ratio (%) Primary School - Total ,1 101,4 107,8 101,4 Primary School - Female ,2 97,6 105,6 101,3 Secondary School - Total ,0 47,5 64,0 100,2 Secondary School - Female ,8 44,3 62,6 99,8 Primary School Female Teaching Staff (% of Total) ,3 44,3 60,7 81,7 Adult literacy Rate - Total (%) ,0 67,0 80,3 98,4 Adult literacy Rate - Male (%) ,3 75,8 86,0 98,7 Adult literacy Rate - Female (%) ,2 58,3 74,9 98,1 Percentage of GDP Spent on Education ,2 4,6 4,1 5,1 Environmental Indicators Land Use (Arable Land as % of Total Land Area) ,1 7,6 10,7 10,8 Annual Rate of Deforestation (%) ,1 0,6 0,4-0,2 Forest (as % of Total Land Area) ,3 23,0 28,7 40,4 Per Capita CO2 Emissions (metric tons) ,1 1,1 2,9 12, Infant Mortality Rate ( Per 1000 ) Central African Republic Africa 2011 Sources : AfDB Statistics Department Databases; World Bank: World Development Indicators; last update : Note : 1 UNAIDS; UNSD; WHO, UNICEF, WRI, UNDP; Country Reports. n.a. : Not Applicable ; : Data Not Available. June 2012

28 Appendix II: Table of the Bank Group s Portfolio of Multinational Operations in Central Africa as of 30 June 2012 (in UA million) Sector/Dpt Project Name Approval Date Closing Date ADB Amount ADF Amount TOTAL ADB+ADF Amount Disbursement Disbursemen t rate. AverageAge WATER AND SANITATION AWTF ECCAS REGIONAL WATER SUPPLY 09/02/ /30/ % 2.8 ENERGY ONEC STUDY ON INGA AND RELATED 04/30/ /31/ % 4.1 CONNECTIONS ONEC NELSAP INTERCONNECTION PROJECT-DRC 12/31/ % % 3.8 TRANSPORT OITC.1 COSCAP PROGRAMME IN WCA (CAPACITY 04/27/ /31/ % 7.2 BUILDING) OITC.1 CAR- TRANSPORT FACILITATION 07/05/ /31/ % 5.0 OITC.1 CEMAC TRANSPORT FACILITATION 07/05/ /31/ % 5.0 OITC.1 CAMEROON TRANSPORT FACILITATION 07/05/ /31/ % 5.0 OITC.1 CHAD TRANSPORT FACILITATION 07/05/ /31/ % 5.0 OITC.1 BAMENDA-MAMFE-EKOK-MFUM-ABAKALIKI 03/31/ /31/ % 3.7 ROAD OITC.1 CAMEROON/GONGO: KETTA-DJOUM ROAD 09/25/ /31/ % OITC.1 STUDY ON KINSHASA- BRAZZAVILLE 12/03/ % 3.5 BRIDGE ONRI CENTRAL AFRICA BACKBONE CEMAC 12/08/ /31/ % 3.4 PRIVATE SECTOR % 4.5 OPSM3 RASCOM TELECOMMUNICATION SATELLITE 07/24/ /01/ % 5.0 AGRICULTURE OSAN4 LAKE TANGANYIKA DEVELOPMENT 11/17/ /31/ % 7.6 PROJECT (DRC) OSAN2 COTTON SECTOR SUPPORT PROJECT -CHAD 11/29/ /31/ % 5.6

29 OSAN4 OSAN4 SOCIAL LAKE CHAD BASIN SUSTAINABLE DEVELOPMENT CONGO BASIN ECOSYSTEMS CONSERVATION 12/11/ /31/ % /03/ /31/ % % 5.0 OSHD3 LAKE CHAD BASIN INITIATIVE SUPPORT 10/26/ /31/ % 6.6 OSHD3 APOC (PHASE III) 07/15/ /30/ % 4.0 OVERALL SITUATION % %

30 Appendix III: Major Related Projects Financed by the Bank and Other Development Partners of ECCAS Areas/Projects Peace, Security and Stability Sector Peace Consolidation Mission in the Central African Republic Source of Financing Approval date Date of Closing Effectiveness signature date Approved amount (in CFA.F million) France/EU 09/11/09 09/11/09 12/07/08 01/12/ Peace Facility 4 (PF) EU, 10 th EDF 17/12/10 01/05/11 31/12/ Peace and security support II (PAPS II) EU, 10 th EDF 02/12/10 17/12/10 17/12/10 30/06/ Infrastructure sector (Transport & ICTs) Institutional and operational support to ECCAS for monitoring of PDCT-AC implementation FPPI_NEPAD 27/09/10 06/10/10 06/10/10 30/11/ Railroad bridge and extension of the Kinshasa-Ilebo railway ADB 00/01/00 03/12/08 13/05/09 31/12/ Study on the Doussala-Dolisie road and transport facilitation on the Libreville-Brazzaville corridor ADB/FPPI- NEPAD RIP 18/04/10 19/04/10 23/05/11 31/07/ Study on the Ouesso Bangui Ndjamena Road and Waterways Transport on the Congo, Oubangue and Sangha Rivers ADB/ADF 29/04/11 29/04/11 31/12/ Ouesso-Sangmélima Road expenditure related to ECCAS coordination ADB/ADF 11/01/10 11/01/10 31/12/ Energy and Water Sector Project for the implementation of Central Africa s Regional Water Policy ADB/AWF & NEPAD-IPPF 02/09/09 04/02/10 04/02/10 31/12/ Environment Sector Congo Basin Ecosystems Conservation Support Program (PACEBCo) ADB/ADF 01/02/09 03/04/09 03/04/ Conservation and Development of Fragile Ecosystems of Central Africa (ECOFAC V) EU, 10 th EDF 24/11/10 17/12/10 17/12/10 16/12/ Support System for the Advanced Timber Processing Sector in the Five Congo Basin Countries CFC 15/10/ Agricultural and Rural Development Sector Comprehensive Africa Agriculture Development Programme (CAADP) WB_SF 27/10/10 22/11/10 01/10/10 31/12/ Support Project for Phytosanitary Capacity-Building in the Five Member States of ECCAS and CEMAC FAO 01/06/11 08/06/11 01/07/11 01/01/ Livestock for Livelihoods Project (L4LP) AU-IBAR 01/02/11 01/02/11 01/07/11 31/07/13 14 Project "Participation of African Nations in Meetings of Health and Phytosanitary Standard-Setting Organisations EU, AU-IBAR 115 Trade and Customs Sector PACT II Support to the private sector ITC CDE Multisector Capacity-building for Central African Members of Parliament (REPAC) ACBF 18/12/07 18/12/07 18/12/07 30/06/12 750

31 Appendix IV: Map of the Project Area