IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA P100785) ON A CREDIT IN THE AMOUNT OF SDR MILLION (US$46.65 MILLION EQUIVALENT) TO THE

Transcription

1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Document of The World Bank IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA P100785) ON A CREDIT IN THE AMOUNT OF SDR MILLION (US$46.65 MILLION EQUIVALENT) TO THE FEDERAL REPUBLIC OF NIGERIA IN SUPPORT OF THE SECOND PHASE OF Report No: ICR3058 WEST AND CENTRAL AFRICA AIR TRANSPORT SAFETY AND SECURITY PROGRAM Transport Sector Country Department AFCW2 Africa Region March 28, 2014

2 CURRENCY EQUIVALENTS (Exchange Rate Effective May 31, 2013) Currency Unit = Nigerian Naira (NGN) SDR 1.00 = US$1.50 US$1.00 = NGN FISCAL YEAR January 1 December 31 ABBREVIATIONS AND ACRONYMS AFTN APL ATN BAG BAGASOO CAA CCTV CPS DME ECOWAS ERGP ESIA ESMF ESMP FAA FAAN FM FMA FMOF FMOT FMR GDP GON IASA IATA ICAO ICB ICR IDA IDF IGR ILS IPR ISR IT LAN LLWAS Aeronautical Fixed Telecommunication Network Adaptable Program Lending Air Telecommunications Network Banjul Accord Group Banjul Accord Group Safety Oversight Organization Civil Aviation Authority Closed Circuit Television Country Partnership Strategy Distance Measuring Equipment Economic Community of Western African States Economic Reform and Governance Project Environmental and Social Impact Assessment Environmental and Social Management Framework Environmental and Social Management Plan Federal Aviation Administration (United States) Federal Airports Authority of Nigeria Financial Management Federal Ministry of Aviation Federal Ministry of Finance Federal Ministry of Transportation Financial Management Report Gross Domestic Product Government of Nigeria International Aviation Safety Assessment (done by the FAA) International Air Transport Association International Civil Aviation Organization International Competitive Bidding Implementation Completion and Results Report International Development Association International Development Fund Internally-generated Revenues Instrument Landing System Interim Performance Review Implementation Status Report Information Technology Local Area Network Low Level Wind Sheer Alert System

3 MDA NAMA NCAA NCAT NCB NIMET OP/BP PCU PIM PIU PPF PPR PSC REC RIAS SARP ICAO s SATCOM SBD SDR US$ VAT VOR VHF WCA WCAATSSP YD Ministries, Departments and Agencies Nigerian Airspace Management Agency Nigerian Civil Aviation Authority Nigerian College of Aviation Technology National Competitive Bidding Nigerian Meteorological Agency Operational Policy/Bank Procedures Project Coordination Unit Project Implementation Manual Project Implementation Unit Project Preparation Facility Personal Performance Review Project Steering Committee Regional Economic Community Regional Integration Assistance Strategy Standards And Recommended Practices Satellite Communication System Standard Bidding Documents Special Drawing Rights United States Dollar Value Added Tax Omnidirectional Range Navigation System Very High Frequency West and Central Africa (Region) West and Central Africa Air Transport Safety and Security Program Yamoussoukro Decision Vice President: Makhtar Diop Country Director: Marie-Francoise Marie-Nelly Sector Director Jamal Saghir Sector Manager: Supee Teravaninthorn Project Team Leader: Noroarisoa Rabefaniraka ICR Team Leader: Mohammed Aliyu

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5 THE FEDERAL REPUBLIC OF NIGERIA WEST AND CENTRAL AFRICA AIR TRANSPORT SAFETY AND SECURITY PROGRAM CONTENTS Data Sheet A. Basic Information... i B. Key Dates... i C. Ratings Summary... i D. Sector and Theme Codes... ii E. Bank Staff... ii F. Results Framework Analysis... ii G. Ratings of Project Performance in ISRs... v H. Restructuring (if any)... v I. Disbursement Profile... vi 1. Project Context, Development Objectives and Design Key Factors Affecting Implementation and Outcomes Assessment of Outcomes Assessment of Risk to Development Outcome Assessment of Bank and Borrower Performance Lessons Learned Comments on Issues Raised by Borrower/Implementing Agencies/Partners Annex 1. Project Costs and Financing Annex 2. Outputs by Component Table 2.1: Achievements by Component Annex 3. Economic and Financial Analysis Annex 4. Bank Lending and Implementation Support/Supervision Processes Annex 5. Beneficiary Survey Results Annex 6. Stakeholder Workshop Report and Results Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders Annex 9. List of Supporting Documents MAP

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7 A. Basic Information DATASHEET Country: Africa Project Name: Project ID: P L/C/TF Number(s): IDA ICR Date: 3/14/2014 ICR Type: Core ICR West and Central Africa Air Transport Safety And Security Program - APL Phase 2-A Lending Instrument: APL Borrower: Federal Republic of Nigeria Original Total Commitment: Revised Amount: XDR 22.07M Environmental Category: B XDR 30.90M Disbursed Amount: XDR 22.07M Implementing Agencies: Federal Ministry of Aviation: Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigerian College of Aviation Technology (NCAT), and Nigerian Metrological Agency (NIMET). Cofinanciers and Other External Partners: N/A B. Key Dates Process Date Process Original Date Revised / Actual Date(s) Concept Review: 04/17/2006 Effectiveness: 06/24/ /24/2008 Appraisal: 05/02/2007 Restructuring(s): 06/23/ /21/2012 Approval: 10/02/2007 Mid-term Review: 06/30/2010 Closing: 06/30/ /31/2013 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Risk to Development Outcome: Bank Performance: Borrower Performance: Moderately Satisfactory Substantial Moderately Satisfactory Moderately Unsatisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Moderately Quality at Entry: Moderately Satisfactory Government: Unsatisfactory Implementing Moderately Quality of Supervision: Satisfactory Agency/Agencies: Unsatisfactory i

8 Overall Bank Performance: Overall Borrower Moderately Satisfactory Performance: Moderately Unsatisfactory C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Performance (if any) Potential Problem Project Yes at any time (Yes/No): Problem Project at any time (Yes/No): DO rating before Closing/Inactive status: Yes Moderately Satisfactory Quality at Entry (QEA): Quality of Supervision (QSA): None None Rating D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Aviation Central government administration 6 6 Theme Code (as % of total Bank financing) Infrastructure services for private sector development Regional integration Regulation and competition policy Trade facilitation and market access E. Bank Staff Positions At ICR At Approval Vice President: Makhtar Diop Obiageli Katryn Ezekwesili Country Director: Marie Francoise Marie-Nelly Hafez M. H. Ghanem Sector Manager: Supee Teravaninthorn C. Sanjivi Rajasingham Project Team Leader: Noroarisoa Rabefaniraka Pierre A. Pozzo di Borgo ICR Team Leader: Mohammed Aliyu ICR Primary Author: Mohammed Aliyu F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The Project Development Objective is to: a) Improve Civil Aviation Authorities (CAAs) compliance with International Civil Aviation Organization (ICAO) safety standards; b) ii

9 Increase CAA s compliance with ICAO s security standards; and c) Enhance main international airports compliance with ICAO s security standards. Revised Project Development Objectives (as approved by original approving authority) None (a) PDO Indicator(s) Indicator Baseline Value Original Target Values (from approval documents) iii Formally Revised Target Values Actual Value Achieved at Completion or Target Years Indicator 1 : NCAA's compliance rate with ICAO's safety standards Value quantitative or 70% 90% 88% Qualitative) Date achieved 06/30/ /30/ /31/2013 The indicator measures Compliance rate with ICAO safety standards. Comments The achievement is significant with a difference in percentage points equal to 18 (incl. % from the baseline level to the actual value achieved at completion. The target was achievement) nearly achieved 88%. Indicator 2 : NCAA s compliance rate with ICAO's security standards Value quantitative or 70% 90% 85% Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments (incl. % achievement) The achievement is significant with a difference in percentage points equal to 15 from the baseline level to its actual value achieved at completion. The target was nearly achieved 85%. Indicator 3 : Percentage of embarking passengers stopped in possession of illegal objects as defined by ICAO and by airlines security personnel Value quantitative or < 6% < 2% 3% Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments (incl. % achievement) The achievement is a good improvement from the baseline level as the measured percentage has been reduced by half. Achievement 67% (b) Intermediate Outcome Indicator(s) Indicator Baseline Value Original Target Values (from approval documents) Formally Revised Target Values Actual Value Achieved at Completion or Target Years Percentage of NCAA's technical personnel in compliance with ICAO's safety Indicator 1 : standards Value 84% 90% 88%

10 (quantitative or Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments Original target value almost achieved. This indicator is a key element in (incl. % assessing a Civil Aviation Authority (CAA) s performance. 88% Achieved. achievement) Indicator 2 : Total NCAA's budget (US$ millions) Value (quantitative or Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments Target value was surpassed. This demonstrates an increasing financial autonomy (incl. % of NCAA. 130 % achieved. achievement) Indicator 3 : Percentage of airport security personnel with three or more years of experience Value (quantitative <45% >90% 82% or Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments (incl. % achievement) Indicator 4 : A significant jump was recorded from the baseline to the value at the end of the project, which indicates efforts of stabilization of staff turnover at the airports under observation. Percentage of NCAAs' ICAO certified security inspectors trained during the last three years Value (quantitative 80% 90% 90% or Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments (incl. % achievement) Target was 100% achieved. Indicator 5 : NCAA's budget level dedicated to security (US$ millions) Value (quantitative or Qualitative) Date achieved 06/30/ /31/ /31/2013 Comments (incl. % achievement) Indicator 6 : Target was not met, by a relatively large shortfall, but NCAA is more aware of the necessity to continue to monitor this parameter in order to further enhance its security oversight duties. 53% achieved. Number of serious problems recorded during annual airport crisis exercise/ airport Value (quantitative Baseline not available 3 per airport 4 per airport or Qualitative) Date achieved 06/30/ /30/ /31/2013 Comments (incl. % achievement) No baseline was available at appraisal and a target of 3 per airport was set which the project almost achieved - 75% iv

11 G. Ratings of Project Performance in ISRs No. Date ISR Archived DO v IP Actual Disbursements (USD millions) 1 12/29/2007 Satisfactory Satisfactory /30/2008 Moderately Satisfactory Moderately Satisfactory /09/2008 Moderately Satisfactory Moderately Satisfactory /21/2009 Satisfactory Moderately Satisfactory /27/2009 Satisfactory Moderately Satisfactory /05/2010 Satisfactory Moderately Unsatisfactory /11/2010 Satisfactory Moderately Satisfactory /28/2011 Satisfactory Moderately Satisfactory /24/2011 Satisfactory Moderately Satisfactory /11/2012 Satisfactory Moderately Satisfactory /07/2012 Moderately Satisfactory Moderately Satisfactory /28/2013 Moderately Satisfactory Moderately Unsatisfactory /27/2013 Moderately Satisfactory Moderately Unsatisfactory H. Restructuring (if any) Restructuring Date(s) Board Approved PDO Change ISR Ratings at Restructuring DO Amount Disbursed at Restructuring in USD millions 06/23/2011 S MS IP Reason for Restructuring & Key Changes Made Extension of Closing date. From June 30, 2011 to June 30, To allow completion of ongoing contracts related to the implementation of key activities contributing to achieving the project development objectives achievement (recruitment of consultants to update ICAOrelated project indicators; update of non-icao related indicators; civil works at NCAA training center); and (ii) enhancement of air transport safety and security, by allowing the Recipient to re-align the activities they wish to finance with adjusted priorities, with the inclusion on a fifth parastatal agency involved in air transport safety: the Nigeria

12 Restructuring Date(s) Board Approved PDO Change ISR Ratings at Restructuring DO IP Amount Disbursed at Restructuring in USD millions 06/21/2012 S MS Reason for Restructuring & Key Changes Made Meteorological Agency (NIMET) Extension of Closing date from June 30, 2012 to May 31, 2013, to allow the completion of previously scheduled activities that were under procurement process and would consolidate safety and security concerns (such as the acquisition and installation of closed-circuit television for Abuja and Lagos international airport) and the completion of the acquisition and installation of equipment that have been previously defined after design studies financed by the project for some parastatal agencies; and (ii) the possible review of the priority activities if the Government agrees to do so. I. Disbursement Profile vi

13 1. Project Context, Development Objectives and Design 1.1 Context at Appraisal 1. Country background. At the time of project appraisal, Nigeria was experiencing the first civilian-to-civilian transfer of power in the country s history. Expectations were high for consolidating democratic governance, strengthening the enabling governance environment and creating space for non-state actors at both federal and state levels. Progress had been made towards improved macroeconomic stability. The government s fiscal deficit had been reduced from an average of 4.7 percent of the Gross Domestic Product (GDP) between 1999 and 2003, to below 2 percent between 2004 and 2005; and to a surplus of 6.6 percent in 2006 and 1.0 percent in Real GDP growth was 6.3 percent in 2007, up from 6.0 percent in While the oil sector still dominated the economy, efforts were being made to diversify the economy. 2. Air transport background. Air transport held both a potential for growth and for the economic diversification and development of Nigeria. Poor road, port and railway infrastructure had been constraining the rapid and efficient movements of high value goods earmarked for export, as well as internal travelers and visitors to Nigeria. Air transport had however its own long list of shortcomings that prevented Nigeria, as well as other countries in West and Central Africa (WCA), from tapping its full economic development potential. 3. In order to address these shortcomings, African Ministers responsible for civil aviation adopted in 1999 the Yamoussoukro Decision (YD) on the liberalization of access to air transport markets in Africa. It is enforceable continent-wide since it was endorsed by the African Union Heads of State under the African Union Treaty framework signed in The YD s primary aim is to liberalize intra-african air transport. In order to achieve this goal without compromising safety and security standards, national Civil Aviation and Airport Authorities must be capable to collectively reach the International Civil Aviation Organization (ICAO) s standards in these areas. ICAO s Standards and Recommended Practices (SARP) are complemented by a certain number of Annexes in the Chicago Convention on International Civil Aviation. 4. The main safety 1 issues that were facing Nigeria s, and WCA s, air transport sector included the lack of a compliant and enabling legal framework and a critical shortage of qualified inspection manpower. Nearly all WCA countries lacked the required level of Civil Aviation Administration capacities. The situation resulted in the presence of unqualified airlines whose operations distorted the air transport market, prevented access to the world market for locally registered African airlines, and largely contributed to WCA s high accident rates, which were thirty times higher than that of the United States in 2007 according to ICAO s statistics. 5. In terms of security 2, fewer than five of WCA s numerous international airports were compliant with world standards. Indeed, most WCA international airports lacked adequate 1 ICAO Definition of Air Transport Safety: A condition in which the risk of harm or damage is limited to an acceptable level. 2 ICAO Definition of Air Transport Security: A combination of measures and human and material resources intended to safeguard civil aviation against acts of unlawful interference. 1

14 security procedures and basic access control to runways and terminals. This situation endangered WCA s air transport network security, resulting in sky-high insurance costs and high internal security costs for airlines. Moreover, in a post September 11, 2001 environment, WCA had been further isolated from main air trade flows. 6. This safety and security agenda had to be tackled within Nigeria s own institutional framework. Under the aegis of the government through the responsible ministry (Ministry of Transport at the start, and then the Ministry of Aviation at the end of the project), the aviation sector in Nigeria is organized around five main agencies: (a) the Nigerian Civil Aviation Authority (NCAA), which regulated the sector; (b) the Federal Airport Authority of Nigeria (FAAN), which managed all of Nigeria s twenty one main airports; (c) the Nigerian Airspace Management Agency (NAMA), which provided air traffic services, including air traffic control, aeronautical telecommunications, visual and non-visual aids, to enable public transport, private business and military aircraft flight within Nigeria s airspace; (d) the Nigerian College of Aviation Technology (NCAT), which managed four training schools; namely a flying school, an aircraft maintenance engineering school, an air traffic services/communications school and an aeronautical telecommunications engineering school; and (e) the Nigerian Metrological Agency (NIMET). 7. Apart from the demonstrated deficiencies in safety and security, a host of issues affected day-to-day operations of the aviation sector in Nigeria. Among the most pressing ones were: (a) sector and agency governance, which was the result of many years of mismanagement and poor governance in the sector; (b) lack of funding, although the agencies financial books looked relatively healthy, the combination of delays by the Federal Authorities in transferring the ticket charge receipts, as well as difficulties associated with the collection of users fees from domestic airlines tend to leave these agencies often cash strapped; and (c) overstaffing, which translated into an overall employee productivity level several folds lower than that of its South African counterparts, for example. 8. Rationale for Bank assistance. The World Bank was instrumental in the adoption of the YD and later supported through successive regional International Development Fund (IDF) grants, the adoption of common policies in safety and air transport regulations in WCA. The Bank along with regional institutions and other international lenders had to acknowledge that most WCA states did not and would not, in the foreseeable future, have the financial and human resources to comply and maintain such compliance with either the United States or ICAO s safety and security requirements without external assistance. Accordingly, the Bank in conjunction with regional institutions and other international lenders adopted a comprehensive approach to address these problems by: (a) supporting the establishment of regional mechanisms to oversee safety and security standards in member countries; and (b) financing of national safety and security support programs to enhance local CAA s ability to comply with ICAO s standards. 9. Contribution to higher level objectives. This project, which was part of the West and Central Africa Air Transport Safety and Security Program (WCAATSSP), focused on Nigeria while directly supporting the ultimate goal of regional integration in this part of Africa. In spite of the long term goal of establishing regional aviation safety agencies in WCA, the enforcement of aviation safety and security at the time of appraisal remained in the foreseeable future a 2

15 national endeavor, if only for legal reasons 3. It was critical that known shortcomings affecting national CAAs aviation safety and security oversight capacity, as well as airport security personnel and infrastructure be addressed at a national level, because regional aviation safety and security reflects each country s achievements in these areas. This approach was in line with and directly supported the Regional Integration Assistance Strategy (RIAS) for West Africa, adopted by the Bank on August 2, 2001, and for Central Africa, adopted by the Bank on February 6, In addition, the same approach was consistent with the Africa Action Plan, which was adopted by the Bank in September 6, 2005 and it promoted regional integration, regional exchanges and economic growth. The regional integration goals and the approach of WCAATSSP meant that the program and the project met all of the requirements to be classified as a regional project. 10. Lending instrument. At appraisal, since the readiness and needs of the 23 WCA countries that were to receive support from the program varied significantly, it was decided to select a horizontal Adaptable Program Loan (APL) instrument to allow for a phased long-term development program. Countries were to join the program under three successive phases using similar eligibility criteria. These criteria were: (a) the creation of an administratively and financially autonomous national civil aviation agency; (b) the use of aviation security and/or safety taxes for the purpose of financing its civil aviation agency; and (c) the attainment of definite percentage of compliance level with ICAO s standards in the areas of aviation security and safety, as well as improved airport security. Prior to appraisal, Nigeria met these criteria, and in particular NCAA had been established as an operationally and financially autonomous authority under the Civil Aviation act of Under Phase I of the program, approved by the Board in April 2006, four countries, namely Burkina Faso, Cameroon, Guinea and Mali, received a total of United States Dollar (US$) million in grant and credit financing. Phase II-A of the program included only Nigeria and is the focus of this Implementation Completion Report (ICR). The Phase II-A project was approved in October 2007, with a credit amounting to US$46.65 million. Phase II-B of the program which included Benin and Senegal, for an estimated total investment cost of US$16.00 million was approved by the Board on February 25, Phase III, which should have included Mauritania, the Republic of Congo, Equatorial Guinea, Cote d Ivoire, Ghana, Niger, Guinea Bissau, Liberia, Sierra Leone, Chad, Central African Republic, Sao Tomé & Principe, and Togo for an estimated investment cost of US$55.28 million, was never triggered. This is because: (a) change in the World Bank s regional priorities and financing constraints even though air transport remained a priority at the national level; (b) the program design entailed high transaction costs with negotiations, Financing Agreements, and implementation support costs for each beneficiary country; and (c) the lack of immediate expression of interest from the potential client sides. 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) 12. The Project Development Objective (PDO), as stated in the Financing Agreement, was to support Nigeria in improving compliance of its civil aviation authority and principal international airports with ICAO safety and security standards. 3 According to the 1944 Chicago convention, aviation regulation remains a sovereign activity. Until this approach is altered, air safety and security will continue to be managed at national levels. 3

16 13. The project development objectives, as stated in the Project Appraisal Document (PAD), were as follows: (a) improve CAAs compliance with ICAO safety standards; (b) increase CAAs compliance with ICAO s security standards; and (c) enhance main international airports compliance with ICAO s security standards. Although the two wordings of the PDO are not exactly the same in the two documents, they are consistent. 14. The performance indicators, as set out in the PAD and in the Financing Agreement, and the expected changes in these indicators values are presented in Table 1 below. Table 1: Indicators at Appraisal PDO Main Project Outcome Indicators Expected changes 1. Improve NCAA s Compliance rate with ICAO safety standards. From 70% to at least 90% compliance with Percentage of Nigerian Civil Aviation Authority From 84% to at least 90% ICAO s safety (NCAA) technical personnel in compliance with standards. ICAO s safety standards. Total NCAA s budget (US$ millions). From $40 million to at least 2. Improve NCAA s compliance with ICAO s security standards. 3. Enhance main international airports compliance with ICAO s security standards. $47 million Compliance rate with ICAO s security standards. From 70% to at least 90% Percentage of NCAA s ICAO certified security From 80% to at least 90% inspectors trained during the last three years. Level of NCAA s budget dedicated to security From $0.65 million to at least (US$ million). $1.50 million Percentage of airport security personnel with three or From < 45% to at least 90% more years of experience. Number of serious problems recorded during annual To 3 or less (Baseline was airport crisis exercise/ airport. not available at appraisal) Percentage of embarking passengers stopped in From >6% to 2% or less possession of illegal objects, as defined by the ICAO, by private airline security personnel. 1.3 Revised PDO and Key Indicators, and reasons/justification 15. The PDO was not revised at any time during project implementation and the key indicators remained unchanged. 1.4 Main Beneficiaries 16. The PAD did not specify the main beneficiaries. However, as captured in the PDOs and components, the project benefited five government agencies involved in civil aviation: Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigerian College of Aviation Technology (NCAT), and Nigerian Metrological Agency (NIMET), further to the project restructuring in The level of performance of these agencies, which hinges on their compliance with international safety and security standards, has a direct impact on the air transport industry in Nigeria. 17. The secondary beneficiaries of the project are passengers who use air transport services in Nigeria (about 8.3 million in 2010), freight shippers who transport their goods by air (about 4

17 180,000 tons in 2010), airline companies and other air transport-related businesses (which by estimates supported some 160,000 direct, indirect, and induced jobs in 2010) Original Components (as approved) Component 1: Strengthening of Safety and Security Oversight Capacity (US$29.29 million) NCAA (US$7.90 million) a) Replacement of basic communications and inspections equipment e.g. Very High Frequency (VHF) radios, IT network at headquarters, etc.; b) Purchase of technical library equipment (e.g. relevant ICAO s manuals, directives, online library, training materials, etc.); c) Training of civil aviation staff in the area of civil aviation safety oversight; and d) Establishment of an in-house personnel training center. FAAN (US$4.70 million) a) Construction of crisis management centers; b) Construction of aircraft remote parking in the event of crisis; c) Acquisition of airport security equipment (closed circuit television monitoring systems, X-Ray machines for freight and passengers luggage); d) Acquisition of firefighting equipment; and e) Training of airport safety personnel. NAMA (US$7.99 million) a) Replacement of the satellite communication system and extension of VHF coverage pending the results of a prior exploratory study of satellite communication system needs; b) Acquisition of resource software and information and document management system as identified by the institutional study financed under Nigeria s Economic Reform and Governance Project (ERGP); c) Installation of a local area network at tower controls of Lagos, Abuja, Port Harcourt and Kano airports; and d) Training for air traffic control personnel based on a prior needs assessment study. NCAT (US$8.70 million) a) Acquisition of two basic flight simulators; b) Purchase and Installation of runway lights, Instrument Landing System (ILS) and VHF Omnidirectional Range Navigation System (VOR) for the School s airport to enable night flight operations training; c) Construction/ Expansion of a non-destructive testing, a cartography and Air Telecommunications Network (ATN), Aeronautical Fixed Telecommunication Network (AFTN) and Aeronautical Message Handling System (AHMS) laboratories within NCAT s premises; 4 Oxford Economics,

18 d) Purchase and Installation of Fire Fighting training equipment based on a prior needs assessment study and a Memorandum of Understanding 16 with the involved agencies; and e) Personnel training based on a prior needs assessment study. Component 2: Strengthening of Security Standards of Principal International Airports (Abuja, Kano, Lagos, Port Harcourt) (US$10.06 million) NCAA (US$1.70 million) a) Installation of a security system and an access control system at headquarters; and b) Training of civil aviation staff in the area of civil aviation security. FAAN (US$8.36 million) a) Acquisition of basic communications and inspections equipment for airport personnel (e.g., VHF radios, IT network at headquarters, etc.); b) Strengthening of airport security (design of airport emergency plans and installation of airport personnel identification equipment, security cameras and, communications systems); c) Construction, within each airports operational perimeters of a single aircraft remote parking zone in the event of a crisis; d) Rehabilitation and/or construction within existing airport buildings of crisis centers, including acquisition of necessary communication and surveillance tools to equip these centers; e) Improvement of airport security through the acquisition of passengers and cargo X-ray machines, as well as an explosive material tracer; and f) Training of airport security personnel. Component 3: Project Coordination, Management, and Oversight (US$8.76 million) 18. This activity was meant to encompass the financing of project operating costs covering the Project Coordination Unit (PCU) and the Project Implementation Units (PIUs) salaries, office rentals and expenses; as well as inter alia annual fiduciary audits and day-to-day management. 1.6 Revised Components 19. There were no formal changes to the project components. However, some of the initial scheduled activities were dropped such as: (a) acquisition of resource software and information and document management system; (b) construction of the in house training center; (c) acquisition of runway lights; (d) two basic flight simulators; and (e) acquisition of passengers and cargo X-ray machines, as well as an explosive material tracer, as FAAN preferred to double the number of firefighting equipment to be financed by the project and take charge of procuring these security equipment themselves using government funds. Most of those dropped activities were later financed by the agencies themselves. Further to the inclusion of NIMET among the parastatal beneficiary agencies of the project during the 2011 restructuring, some new activities were included. The added activities were compliant with the PDOs, and they included: training of NIMET staff, supply of Upper Air Consumable and other spare parts for Automated Weather Observing System spares operated by NIMET. Agreement was also reached during project 6

19 implementation that the project would finance the procurement of low level wind shear (LLWS) equipment for NIMET with a budget of about US$4 million. Subsequently, the LLWS equipment was purchased using government funding. 1.7 Other significant changes 20. Closing date was extended twice. The project underwent two Level 2 restructurings during its life (June 2011 and in June 2012). The first extension of the project closing date was carried out in order to formally include a fifth government agency (NIMET) involved in air transport safety, and to extend the closing date of the project by a year. The second restructuring was aimed at extending the closing date of the project from June 30, 2012 to May 31, 2013, thereby, making a cumulative extension period of 23 months. In both cases, the closing date extension was necessary following project implementation delays, to allow the continuation of previously scheduled activities that were under procurement process such as the acquisition of airfield lighting and Fire Fighting Simulator for NCAT, Security Upgrade NCAA, Airport Wailer-Birds deterrent equipment for FAAN, fire-fighting simulator, and the procurement and installation of badge identification and closed circuit television monitoring systems (CCTV systems) for Lagos and Abuja airports. 21. Government-funded activities. Some of these activities were however not carried out under the project, but they were implemented, with some adjustments, using parastatal agency funding (e.g.: the misprocured air navigation systems; security device scanning at the airports, as the government preferred to use the project s funds to finance double the number of fire fighting vehicles) and government procedures outside the ambit of the project 5. The successful procurement and installation by the government have consolidated the safety and security gains already achieved under the project as the activities had a positive outcome on the PDO. Please see Annex 2 for a detailed breakdown of outputs by component. 22. Another significant change was the declaration of misprocurement for the acquisition of two ILS/VOR/DME 6 systems in November 29, Consequently an amount of SDR1.53 million (US$2.35 million equivalent) was cancelled from the initial Credit amount. The reason for the misprocurement was that no legal documentary evidence was provided to the Bank to support the project s rejection of the lowest evaluated bid, and the Government s subsequent decision to instruct NAMA to finance the purchase of such equipment from its internallygenerated revenues (IGR). 5 Detailed information relating to these procurements was unavailable to the ICR team during the preparation of this report 6 ILS: Instrument Landing System; VOR: VHF Omni-directional Radio; DME: Distance Measuring Equipment. 7

20 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry 23. Soundness of the background analysis. As previously indicated, the project was part of a WCA region-wide program to enhance air transport safety and security. Project preparation included a good analysis of the challenges facing the aviation sector in the region in general, and in Nigeria in particular at the time of appraisal. Project preparation built on successful Bank involvement in the sector, which was instrumental in the adoption of the YD, as mentioned above in paragraph Assessment of the project design. The project design, scope and components were developed to respond to the key challenges facing the aviation sector. The project also had a strong and extensive capacity building component aimed at enhancing the functionality of the staff of the beneficiary agencies and ensuring the long term sustainability of results achieved under the project. Project design can also be credited for breaking grounds in forcing cooperation between air transport entities that traditionally worked in silos. The complexity of the technical aspects of the various sophisticated equipment that were to be procured under the project may however have been under-estimated. In particular, beneficiary agencies had difficulties preparing technical specifications for complex systems, and in particular in developing the functional requirements for those systems. This was not without consequences on the efficient and timely implementation of the procurement processes. The project team also seems to have underestimated the time it takes for most projects to become effective in Nigeria, as well as the time it takes to have the implementing agencies fully on board especially when not conversant with IDA process and procedures. Finally, the project was affected by the frequent changes in the Ministry of Aviation, including the Minister, during project preparation and in the first three years of implementation. 25. Project design took cognizance of the fact that NAMA, NCAA and FAAN derived substantial revenues from users fees, although these agencies suffered from a combination of delays by the Federal Authorities in transferring the ticket charge receipts, as well as difficulties associated with the collection of users fees from domestic airlines which left these agencies often cash strapped. The project design therefore envisaged that the Nigerian component of the WCAATSSP could act as a gap financing tool until such time when the Federal Government has devised a more reliable system to ensure proper financing of the various sector s agencies. As it turned out, during implementation, government and agency funds did become available and they were used to fund some activities initially envisaged under IDA funding. 26. Linkage with other Bank Projects. Prior to the commencement of the project some activities and preparatory studies were undertaken under the ERGP. Both projects were intended to be complementary, the idea being that the WCAATSSP would implement some of the recommendations arising from the reports financed by the ERGP, while the goods and works from the ERGP would reinforce the achievement of the WCAATSSP s PDO. The key activities funded by the ERGP include: (a) Institutional study of each aviation agency (with a training needs assessment); (b) Recertification of the Nigerian airline industry for NCAA; (c) Construction of operational perimeter fences and access roads at Abuja and Port Harcourt International Airports; and (d) Installation of Low Level Wind Sheer Alert System (LLWAS) for 8

21 Lagos, Kano, Port Harcourt and Abuja Airports. The recommendations of the training needs assessment funded under the ERGP were implemented under WCAATSSP as part of the capacity building program and the output of the second study allowed an NCAA to rapidly address the issue of un-airworthy airlines operating in the country. 27. Adequacy of government s commitment, and stakeholder involvement. At the time of appraisal, the project was consistent with the objectives and priorities of Nigeria. Those priorities were to address the aviation safety and security crisis, prevalent in the country as Nigeria s airline industry has had particularly poor safety record with three major fatal crashes taking place in alone. The Government and stakeholders commitment was evidenced by the passing of relevant legislation, the provision of financial and administrative autonomy to the NCAA, and the government demand for assistance from the ICAO s Technical Cooperation Bureau (TCB) to assist the NCAA in carrying out a far reaching airplane and aircrew recertification exercise. Project preparation was also carried out in conjunction with other international partners such as ICAO, Economic Community of West African States (ECOWAS), and African Development Bank (ADB). 28. Assessment of risks. At appraisal, the overall risk for the project was rated as substantial. The following is an assessment of project risks identified at appraisal: a) Implementation capacity. There was a substantial risk that limited project implementation capacity of the Project Implementation Units (PIUs) (FAAN, NAMA, NCAA and NCAT) would slow down project implementation. To mitigate this risk, a combined Project Coordination Unit (PCU) and PIU approach was part of the project design to distribute technical and fiduciary responsibilities with each PIU officer reporting to their corresponding counterpart in the PCU. This approach helped overcome the initial project implementation challenges and helped ensure greater quality control in outputs. Additionally, as part of the risk mitigation measures, project design included the establishment of a project steering committee (PSC) under the stewardship of the Federal Ministry of Aviation. Although the committee was established, its effectiveness in risk mitigation was only partly successful. The steering committee was unable to convene and meet as expected. This prevented it from providing the necessary support needed to resolve most of the constraints that hampered project implementation. b) Ability of NCAA to aggressively enforce security and safety standards on national operators. This risk was rated as Substantial, and it was well mitigated as NCAA was able to carry out a recertification exercise of the airline industry in 2010 under the support of the ERGP. Through the assistance of the project, Nigeria was able to receive US FAA Category 1 in 2010, and had continued to maintain this rating at the time of this ICR. The preservation of this rating highlights the sustainability of NCAA enforcement ability throughout the project. c) Ability of NCAA to secure and maintain a technically proficient workforce. This risk was rated as Substantial and it was to be mitigated by: (i) extensive capacity building based on a prior needs assessment by the project; and (ii) increase of salary scales within 9

22 NCAA to be more competitive. The mitigation measures were successful as supported by NCAA s training achievements (see Section on Assessment of Outcomes). 29. The risks identified during project preparation were generally appropriate. The overall project risk was rated Substantial, and the supporting analysis appears appropriate for most of the assumptions made. However, political interference, a key risk, could have benefited from a greater emphasis. In fact, during project preparation this was indeed the Bank team s initial proposed a substantial risk rating for the project, but it was lowered following negotiations. With the benefit of hindsight this rating should have been High due to the following reasons: the high turnover of Ministers of Aviation (six different ministers); the late effectiveness of the project; the decision of the Government relative to the procurement process that led to misprocurement; the inability of the PCU to fully implement procurement activities despite a cumulative 23 month extension due to lack of a formal reallocation request from the Government of Nigeria; and in some cases, arbitrary decisions from the Minister, such as the cancellation of planned training activities for technical staff by the Ministry. 2.2 Implementation 30. Project objectives. Overall, the PDOs were focused on improving compliance with international safety and security standards. As such, they were clear, and the performance indicators were generally adequate for measuring project performance. The PDOs were also realistic as they did not claim to solve all the problems facing the sector. The PDOs responded to borrower circumstances and development priorities and supported both the Country Partnership Strategy , and the Bank s regional integration strategy. The PDOs did not place unrealistic demands on the government or the implementing agencies, given their relative simplicity. It seems however that the timeframe initially envisaged to complete the project and achieve project outcome may have been underestimated by one or two years. Key factors in this type of projects that attempt to achieve significant organizational performance improvement in an environment of weak human resource capacity, and governance are people and organizational behavior. The project supported some training activities, but it may not have been sufficient to influence behavior. 31. Components. The components were designed to achieve project objectives although the management of the implementation of the various components may have initially been beyond the capacity of some agencies. For example, as previously indicated, at the start of project implementation, the PIUs experienced some challenges regarding the complex technical specifications that were to guide the procurement of certain systems under the project (e.g. the specifications for the X-Ray machines and Fire Tenders for FAAN), due to the novelty of Bank procurement requirements. Finally, as explained in the PDO discussion above, barring the training component, components that could have helped in influencing the behavior of people or organizations were not part of the project. The reason might have been that such components that could have supported a change management approach may not be suitable under investment projects. In fact, a technical assistance under the parallel Bank-funded ERGP was designed to offer a platform for dialogue between IDA and the Government on the issue of governance and efficiency of the air transport parastatals. 10

23 32. Factors outside the control of government or implementing agencies. The achievement of the higher level objectives of the project of making air transport an engine for regional economic growth was continuously hampered by the non-implementation by countries in WCA of the recommendations and directives of the YD on deregulation of the sector in WCA and the opening of the market, with consequences on sector fragmentation and lower growth rates. Other factors outside the control of government were the tragic loss of two key staff of the project implementation unit in the Dana Air crash in June, Factors subject to government control. Government commitment to the project was high throughout the project preparation and first phase of implementation period, especially from end of calendar year 2009 up till June However, this commitment was increasingly weakened by the bureaucratic inefficiencies. Effectiveness was delayed by about 11 months (until June 24, 2008), due to prolonged bureaucratic procedures. Later on, the responsible ministry had weak oversight over the project s actual progress towards the achievement of its objectives while, in some cases, the Ministry went beyond its strategic and policy oversight role and tried to interfere in procurement decisions at the parastatals level. 34. Following the air crash that occurred on June 3, 2012 involving a Nigerian registered aircraft, the government was very keen to have the project support and bolster aviation safety in Nigeria through the use of uncommitted funds. While the Bank favorably responded to this request, government s position changed, with contradictory signals emanating from the Ministry of Aviation, and the envisaged support was not provided. This lack of clarity from the government side was also highlighted by the in-and-out of the NIMET or the various agreements in principle for project restructuring which went unprocessed by the government. 35. Factors subject to implementing agency control. As identified in project risks, there was a weak relationship between the PCU and the PIUs which translated into the inability of the PCU to enforce appropriate quality control over project implementation management. There were instances where PIUs were unable to meet project reporting deadlines, especially in the case of FAAN, which submitted its 2008 audited accounts in September 2011, and those for 2009 and 2010, in June Regarding procurement capacity strengthening, the PCU and the PIUs did take action through additional trainings. The Bank team also provided intensive implementation support through monthly meetings and videoconferences. These combined efforts ensured that the initial challenges experienced were eventually overcome. 36. Implementation efficiency. Implementation delays were a challenge throughout the project s life. Given that the project design was relatively simple, these delays were partly due to inadequate involvement at the ministry level especially during the second phase of implementation (July 2011 May 2013). The two project closing date extensions were necessary to complete all project activities after it became evident that the initially allocated timeframes were no longer sufficient. Despite this, the ministry never formally submitted to the Bank a request to finance the remaining feasible activities and a project s funds reallocation request which would have contributed to the achievement of the PDO; but rather limited their requests to extensions of the project s closing dates. Therefore, despite the two extensions, several project activities could not be completed, and consequently project funds were not fully used. As stated earlier this was due to the inability of the PCU to receive clear approvals from the parent 11

24 Ministry to commence the necessary procurement and the inability for the government to formalize its restructuring proposals. 2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization. 37. The Results Framework of the PAD consisted of outcome indicators and intermediate results for monitoring progress and outcomes, which reflected the expected results. While the results indicators may appear to be complex, they are based on the industry standards, as defined by ICAO. 38. Project monitoring during project implementation was carried out by M&E Teams which were set up for both the PCU and PIUs. These teams had the primary responsibility of data collection and analysis regarding the impacts of the project in relation to its stated objectives. The evaluation of outcomes during the course of the project was done through the analysis of primary data collected by FAAN and the NCAA. In order to validate the results and ensure objectivity, an ICAO certified safety consultant was engaged to carry out validations and followup audits. The result of the audit was submitted in May, The final achievements as reported at project closure and in this ICR were based on the report of this consultant. 2.4 Safeguard and Fiduciary Compliance Environment and Social Safeguards 39. Environment. The Project triggered Bank safeguards policy Environmental Assessment (OP/BP 4.01) and was classified as an environmental Category B project as the expected environmental and social impacts were minimal and site specific. An Environmental and Social Management Framework (ESMF) and Environmental and Social Management Plan (ESMP) were prepared and disclosed in country and on the Bank s Infoshop: these included all measures to address potential environmental and social impacts. 40. An environmental safeguards audit was undertaken in September 2012 which made recommendations such as the recruitment of environmental officers at desk level and the setting up of committees for monitoring of environmental and social issues and their mitigation measures. The recommendations arising from the report were not fully implemented, and most of them were rendered mute as sub-components of the project that would have required the full implementation of the ESMF and EMP were not implemented by the project. Financial Management (FM) 41. Financial management was rated Moderately Satisfactory, throughout the implementation period. Financial Management Reports (FMR) were received regularly and were mostly compliant with the agreed format. As part of the financing agreement, the agencies supported under the project were to submit their yearly audited financial statements, not later than six months after the period in question. All the agencies complied with this provision except for FAAN. 12

25 Procurement 42. At project appraisal, all procurement arrangements including procurement plan and procurement methods were discussed and were consistent with the Bank s guidelines. With hindsight it seemed that the implementing agency s procurement capacity was initially overestimated as it experienced initial difficulties in the preparation of terms of references and technical specifications of key project activities. These challenges were eventually overcome through the prior review of procurement packages by the Bank s procurement team. The project was however unable to fully implement all activities under its updated procurement plan due to inability to secure permission and approvals from its parent ministry to commence and undertake agreed activities. However a number of these activities with some adjustments were achieved and implemented using government funding as described in Annex 2. A more specific procurement issue was the declaration of misprocurement of the procurement of two ILS/VOR/DME systems as described earlier. 2.5 Post-completion Operation/Next Phase 43. The investments undertaken under the project have been duly internalized in the daily operations of the various beneficiary agencies. For example, the 10 Fire Tender Vehicles have been deployed to four major international airports and the school of aviation as targeted by the project. Very High Frequency (VHF) Radio Communication Equipment is in use in four major airports and facilitates communication amongst the airport workers. Their use helped the four international airports to comply with ICAO standards. 44. A positive aspect of the project was the extensive training and capacity building program of the staff of all the beneficial agencies. The training has greatly enhanced the ability of the agencies to perform their functions thereby improving the industry s safety and security. In this respect, adequate trained staffs are in place to operate the systems. Trained staff have also allowed their respective agencies to ensure compliance with international standards. However, the various agencies also received from the government budget allocations from time to time to help them to make punctual investments. The revenue generating agencies have seen increased revenues due to the increase in passenger traffic and business activity, even though arrears from some domestic airlines remain uncovered. Additionally, the monitoring and evaluation of future operations will rely on the project s M&E framework which is based on industry-standard indicators with a clear and agreed methodology for data collection and reporting. 45. Although there are no plans for another aviation project in Nigeria, the Bank continues to provide its technical support to the ECOWAS in the field of air transport to allow effective follow up of strategic issues such as regional safety and market development. Since Nigeria is the largest member of ECOWAS, especially in terms of air transport market size, it plays a key role in leading this industry s development at sub-regional level. 13

26 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation The overall rating is Substantial for the following reasons. 46. Relevance of the PDO. The relevance of the PDO is rated High. The PDOs remained highly relevant under the Country Partnership Strategy (CPS) and continues to do so under the new CPS, which specifically supports regional programs, including collaborative efforts in West and Central Africa to improve air transport safety and security. The PDOs are additionally highly relevant under Bank s strategy for the transport sector: Safe, Clean, and Affordable Transport for Development. More broadly, the PDOs remain very relevant today as ensuring the safety and security of air transport is an everyday global challenge, and in the case of Nigeria and WCA, there is a long way to go to sustain current achievements. Indeed, air transport safety and security in the WCA region continues to be an issue to be addressed and supported and the number of the region s airlines blacklisted by the European Union is high. 47. Relevance of Design. The relevance of the Design is rated High. Project components directly supported the PDOs as they were in direct response to critical aviation safety and security requirements in Nigeria. Project components focused on extensive training to the staff of the various entities and on updating procedures, which are prerequisite to enhancing the safety and security outcomes and in securing the various international certifications from ICAO for example. Linking the project to the parallel IDA-funded ERGP ensured that activities that were better suited under a country-specific project and outside this regional program were implemented, such as airport-specific investments or governance enhancing activities. The segregation of project components by agencies established clear accountability for project results, while involving the same agencies in all aspects of project implementation helped break grounds in forcing cooperation between air transport entities that traditionally worked in silos. Project design was simple and flexible and allowed some changes to project activities without having to modify the PDOs. The project design paid close attention to an effectively measurable results framework, and this framework remained highly relevant throughout project implementation and continues to remain relevant today as the indicators are using the industry standards for monitoring civil aviation safety and security. 48. Relevance of project implementation. The relevance of Project Implementation is rated Substantial. Project implementation was strong during the initial phases of the project but weakened during the latter part of the project. This was due to diverging views in the Ministry of Aviation combined with the tragic loss of key project implementation staff in However, this weakened implementation performance did not affect the consistency of project design with its PDOs. In fact, during implementation, the Ministry of Aviation wanted to use project funds for new activities that were not in support for the PDOs, and the project successfully resisted any restructuring that would have rendered the project design irrelevant. 49. Furthermore, in terms of implementation, while a relatively large amount of the credit remained undisbursed (US$12.83 million or about 28 percent), the government did not complete the agreed project restructuring as the ministry in charge of aviation did not pay enough attention 14

27 to the project implementation issues since it was not in line with their own priorities, including building new airports. Instead, the Government and some agencies used their own resources to implement some of the previously agreed investments with some adjustments. The PAD did envisage the possibility of this arising as it stated that the Nigerian component of the WCAATSSP would act as a gap financing tool until such time when the government had devised a more reliable system to ensure proper financing of the various sector s agencies. 3.2 Achievement of Project Development Objectives 50. The achievement of the PDOs is rated as Moderately Satisfactory. The NCAA has been truly strengthened which has allowed the country to achieve its Category 1 status with the US FAA. The country s main international airports compliance with ICAO s security standards has also been significantly enhanced, as evidenced by the ability now to have direct scheduled flights between Nigeria and the US. In fact, achieving Category 1 status and direct flights connection to/from the US are in themselves the greatest achievements of the program in Nigeria. These two achievements were not included as outcome indicators of the program because project results framework had been designed and harmonized for the entire APL program that included other countries in the region for which setting such outcome targets would not have been realistic. Objective 1: Improve NCAA s compliance with ICAO safety standards. Rating is Moderately Satisfactory. Table 2: Compliance with ICAO Safety Standards Outcome Indicators Expected Changes Achievements Compliance rate with ICAO safety standards. From 70% to at least 90% 88% Percentage of Nigerian Civil Aviation Authority From 84% to at least 90% 88% (NCAA) technical personnel in compliance with ICAO s safety standards. Total NCAA s budget (US$ millions). From $40 million to at least $61 million $47 million 51. The greatest impact of the project is Nigeria s achievement of IASA Category 1 status in August 2010, and its ability to maintain this achievement ever since, which is not a minor achievement (some countries have obtained and lost their status). This achievement means that the country has the relevant laws and regulations necessary to support the certification and oversight of air carriers in accordance with minimum international standards; the NCAA has the technical expertise, resources, and organization to license or oversee air carrier operations; NCAA has adequately trained and qualified technical personnel, a total of 426 staff trained; NCAA provides adequate inspector guidance to ensure enforcement of, and compliance with, minimum international standards; and the NCAA has sufficient documentation and records of certification and adequate continuing oversight and surveillance of air carrier operations. There has also been good improvement in the two key outcome indicators on compliance with ICAO safety standards. The difference in percentage points between the achieved rate of 88 percent and the end target of 90 percent is not considered substantial by industry standards. All these achievements are directly linked to project activities that enabled the update of regulations and procedures, airlines re-certification, and massive training to certify technical staff. 15

28 52. It is also noteworthy that Nigeria is among the leaders in the Banjul Accord Group (BAG). This sub-regional organization has made substantial progress in air safety and security regulations harmonization by establishing models of regulations. Moreover, they are the only organization that has created a sub-national safety oversight organization in 2009, with the Banjul Accord Group Safety Oversight Organization (BAGASOO), based in Abuja, Nigeria. Thanks to the project and the extensive training it financed, Nigerian inspectors and experts are providing support to BAG member states respective CAA. 53. On funding, while the total overall budget allocated to the NCAA was about US$40 million in 2007, as the baseline level indicates, it achieved US$61 million by the end of the project, which is significantly highly than the targeted value of US$47 million at the end of the project. This sharp increase reflects strong growth in passenger activities in Nigeria over the course of the project to which NCAA s revenues are linked (NCAA funding is linked to airlines ticket sales). Objectives 2 and 3: Improve NCAA s compliance with ICAO security standards, and Enhance main international airports compliance with ICAO s security standards Rating is Moderately Satisfactory 54. The country s main international airports compliance with ICAO s and other international security standards have been enhanced through intensive training of staff involved in security (not only from NCAA, FAAN, but also the customs and police working at the airport) and through acquisition and deployment of equipment under the project. The clear evidence of the enhanced security is the ability now to have direct scheduled flights between Nigeria and the US. Project activities were critical to achieve project outcomes that were equal or slightly below the targets, but the differences are not considered substantial by industry standards. 55. A remarkable achievement was that currently 90 percent of NCAA s ICAO-certified security inspectors were trained under the project in the previous three years, and similarly 82 percent of airport security staff now have more than three or more years of experience. These indicators are part of international standards references, and the achievements are certified by independent technical audits. The project also helped improve security procedures and processes, as NCAA and FAAN, under the oversight of the Ministry of Aviation, implemented the recommendations of various consultancies under the project such as the design and supervision of installation of security upgrade (NCAA), technical assistance for implementation of ICAO safety and security corrective plan. To complement training and procedures, the project provided equipment and systems to enhance security and communication equipment. This extensive training program, together with the deployment of equipment purchased under the project and the implementation of procedures and rules developed under the project allowed significant improvement in security screening: from a baseline of about 6 percent in 2007 the situation had improved to 3 percent of embarking passengers stopped in possession of illegal objects. 56. All these efforts were accompanied by a slight increase in the share of NCAA budget of the earmarked specifically for airport security, which stood at US$0.8 million at the end of the project falling significantly short of the end-of-project target of US$1.5 million. This is a very modest increase when compared to the baseline value of US$0.6 million. 57. However, it is noteworthy that the majority of the security investments envisaged by the project for FAAN were taken over by the agency and were implemented using its own IGR, as it 16

29 was agreed with FAAN that their project s funds allocation would better be allocated to the acquisition of firefighter vehicles. See Annex 2 for a detailed breakdown of activities achieved under the project and using government funds and IGRs. Table 3: Outcome Indicators Outcome Indicators Expected changes Achievements Compliance rate with ICAO s security standards. From 70% to at least 90% 85% Percentage of NCAA s ICAO certified security inspectors From 80% to at least 90% 90% trained during the last three years. Level of NCAA s budget dedicated to security From $0.65 million to at least $0.8 million (US$ million). $1.50 million Percentage of airport security personnel with three or more From < 45% to at least 90% 82% years of experience. Number of serious problems recorded during annual airport To 3 or less 4/airport crisis exercise/ airport. Percentage of embarking passengers stopped in possession From >6% to 2% or less 3% of illegal objects, as defined by the ICAO, by private airline security personnel. 58. The rating of Moderately Satisfactory is therefore justified by the good compliance rates recorded by the project, the achievement and the maintenance of the Category 1 status to date, which has led to a solid air transport sector in Nigeria that represents about 2/3 of the West African Market. 3.3 Efficiency Efficiency is rated as Moderately Satisfactory for the following reasons. 58. The PAD recognized that measuring the economic benefits of the project (and the regional program as a whole) would require forecast data about the quantitative impact of putting in place measures that would strengthen safety and security of air transport in the country (and the region as a whole). However, no such information was available and no cost-related data could be obtained to make relevant computations in the PAD. 59. Furthermore, the nature of the investments financed (i.e. airport security infrastructure and equipment, safety and security training) make any quantification of these benefits difficult. The PAD therefore highlighted the impact, at the time of appraisal, of the project on the aviation sector globally in Sub-Saharan Africa based on available studies and surveys. More specifically, the PAD highlighted the major impacts that the project would have on tourism, travel fares, trade and investment in Africa. 60. The ICR confirms the PAD s view that the assessment of the project s direct economic impacts would be complex and the uncertainty of the assumptions that would need to be made for such an analysis would weaken its validity. The ICR s rating of efficiency as Moderately Satisfactory is therefore based on a review of how air transport has performed in recent years in Nigeria and how the key agencies have performed from a financial stand-point. The ICR also reviewed recent literature of the economic impact of air transport on Nigeria s economy. The assumption is that the project s focus on safety and security, with reasonable costs by industry standards, was instrumental in supporting the development of air transport market in Nigeria. 17

30 This assumption is reasonable, for example in neighboring countries such as in the Democratic Republic of Congo, where the issues of safety and security were not addressed in a similar manner, air transport has failed to develop despite huge potential demand. 61. During project implementation, demand for air transport dramatically increased in Nigeria. According to FAAN figures, passenger traffic across all airports in Nigeria (domestic and international) has increased by an annual average of more than 15 percent per year, and therefore more than doubled during project life. The statistics show that airport passenger traffic has increased from 8.4 million passengers in 2007 to 15.1 million in 2011 and 14.4 million in 2012, hence more than 10 percent annual increase during the course of project implementation. The fall in the number of passengers in 2012 reflects the bankruptcy of Air Nigeria and increased domestic air fares. With regard to the various agencies financial performance, audited financial statements show that FAAN revenues increased from N17.52 billion (US$109 million) in 2006 to N28.04 billion (US$175 million) in 2010; NCAA N5.85 billion (US$36.5 million) in 2007 to N8.94 billion (US$55.9 million) in 2011; and NAMA N6.2 billion (US$38.8 million) in 2007 to N13.6 billion (US$85 million)to 2011; all this with relatively stable operating costs especially for NCAA (see Annex 3). 62. As for the quantification of the economic impacts of air transport in Nigeria, the most comprehensive assessment to date in Nigeria was undertaken by the research firm Oxford Economics in 2012 using 2010 data, and the results are available in the report 7 The key findings of the research were that in 2010 the civil aviation sector contributed by 0.4 percent of Gross Domestic Product (GDP) to Nigeria s economy, and it supported 159,000 jobs or 0.3 percent of the Nigerian workforce. When the sector s contribution as an enabler of the tourism industry is included, these figures rise to 0.6 percent of Nigeria s GDP and 289,000 jobs, or 0.5 percent of the workforce. It is significant to note that these are high productivity jobs. The annual estimated value added or Gross Value Added (GVA) by each employee in air transport services in Nigeria in 2010 was 3.5 million Naira (N) (US$22,000 equivalent), nearly seven times higher than the Nigerian average. 63. Consumer benefits of air transport were also estimated. It was estimated that passengers pay N866 billion (inclusive of tax), and that the value of the benefit to travelers from flying in excess of their expenditure is worth N785 billion a year. Similarly, freight shippers pay airlines N89 billion annually, and the benefits to shippers in excess of this expenditure was estimated at N37 billion. 64. In addition to its economic impacts, the civil aviation sector s tax base in Nigeria is large and the tax revenues derived by GON from it are substantial. More specifically, Nigerian-based aviation companies paid an estimated N8.5 billion annually in direct taxes and social security payments to GON. Passengers paid a further N17.0 billion in Value Added Taxes (VAT) on domestic and international flights originating in Nigeria. It is estimated that an additional N8.9 7 Economic Benefits from Air Transport in Nigeria, published in

31 billion of government revenue is raised by suppliers to the aviation sector and N7.1 billion through taxation of the activities supported by the spending of employees of both the aviation sector and its supply chain This means that the total direct and indirect taxes raised from the aviation sector was estimated for 2010 at N41.5 billion or about US$256 million. 65. With some slight adjustments, the Government used its own funding to implement some of the project sub-components especially regarding FAAN security improvement investments, which led to non-utilization of the respective IDA funding. However, it did mean that those activities were effectively undertaken which had a positive effect on the achievement of indicators and PDOs. At the same time, with two extensions to the project closing date, the project did deliver under IDA funding on most of the soft activities that were key to improving safety and security and ensuring international certification, and those activities included extensive training of staff and management of the various agencies, as well as updating of rules and procedures. 3.4 Justification of Overall Outcome Rating 66. The overall outcome is rated Moderately Satisfactory, due to: (a) the relevance of the PDOs and project design and implementation to the Bank s current CPS and RIAS, national, regional, and global priorities; (b) the moderately satisfactory achievement of the PDOs; and (c) the satisfactory efficiency of the project. The most important indicators to show the achievement of the PDO are: (i) NCAA s compliance with ICAO s safety and security standards; (ii) the increase NCAA s technical personnel in compliance with ICAO s safety standards; (iii) NCAA s certified inspectors trained during the last three years; and NCAA s budget. The target values of those key indicators were all achieved. Besides, even though it was not among the formal indicators (for consistency purposes with the other phases of the project), the FAA IASA Category 1 recognition is a strong argument to justify the rating of the project s overall outcome. Thanks in a great part to the project; air transport in Nigeria is in compliance with international standards for safety and security, therefore supporting one of Nigeria s key priorities following years of underperformance and unfortunate air transport incidents. This was achieved with reasonable costs by industry standards, except for the mis-procured activities. Although the outcomes were mostly achieved, there is a risk of the benefits diminishing if the efforts are not sustained, and the parent ministry has to clearly demonstrate full support of the started reforms and activities, hence, the rating for the project s overall outcomes as Moderately Satisfactory. Table 4: Outcome Ratings S/N Item Rating 1 Relevance Substantial Relevancy of objective High Relevancy of design High Relevancy of Implementation Substantial 2 Achievements Moderately Satisfactory 3 Efficiency Moderately Satisfactory 4 Overall Moderately Satisfactory 19

32 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development 67. The project had no specific poverty, gender or social development related objectives. (b) Institutional Change/Strengthening 68. As stated in section 2 above, the project, and particularly its components, was not specifically designed to directly induce institutional change. To achieve such a goal, dedicated activities that focus on the process of change management within the various agencies would have been needed. Additionally, an investment lending or Adaptable Program Lending (APL) project over a five year period may not be the ideal vehicle to induce an organizational and people behavior change, especially in an environment of weak human resources capacity and governance. The project could however be credited with initiating such a process, thanks to the extensive training program of staff and management in the various beneficiary agencies. This is also reflected in Nigeria exporting its knowhow in the field as described in the following section on unintended outcomes. 69. It should be noted that, the Bank-funded ERGP assisted the government to introduce institutional strengthening initiatives in the sector through a dedicated study. This study was completed before the current project s closing date, and a stakeholders meeting to discuss the study s outcomes and recommendations was held in Lagos and Abuja in April The government s effective implementation of these recommendations will be crucial to sustain the results achieved so far. (c) Other Unintended Outcomes and Impacts (positive or negative) 70. Nigeria has become the leader in WCA in terms of air transport safety and security regulations and their effective implementation. Thanks to the project and the extensive training it financed, Nigerian inspectors and experts are providing support to CAAs in the region such as the Gambia, Liberia, Sierra Leone, and Ghana. 3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops 71. This is a core Implementation Completion Report and Results Report (ICR) which does not require a beneficiary survey/stakeholder workshop 4. Assessment of Risk to Development Outcome Rating: Substantial 72. The ICR identifies the political and the governance risks as significant which reflects the overall operating environment in Nigeria and are not unique to the project. More specifically, most projects in Nigeria including this one were affected by delayed effectiveness. On the political risks, while changes in political circumstances have generally not impacted the overall directions of reforms, they usually impacted the governance structure of the various agencies, including senior management appointments, which in turn can temporarily disrupt safety and 20

33 capacity enhancement initiatives, and put on hold the momentum. Like the overall environment in Nigeria, air transport regulation is not immune from the overall governance risks in Nigeria. 73. The ICR also considers institutional risk as Substantial, as it would take government continuous and deliberate efforts to sustain and build upon the hard won achievements under the project. At the national level, further capacity has been built at the beneficiary agencies, leading to higher expertise, especially in safety and security supervision; funding for security and safety has been improved; and regulations have been updated. There are still pending sector issues, such as the sustainability of reforms started during the project s implementation, their solutions are now fully within the hand of the national Government. Specific attention needs to be paid to the sector s institutional reforms to make the agencies more autonomous in financial and administrative terms, and make them more accountable vis-à-vis the Government and the public, especially the users of air transport services and to the follow-up on the recommendations as contained in the institutional reform studies. It is worthy of note that Nigeria continues to hold Category 1 status thanks to NCAA s improved performance; however, if the autonomy of the NCAA is not guaranteed, this could translate into poor performance and Category 1 status could be withdrawn. 74. Apart from these risks, other conceivable risks are rated negligible/low to moderate. These include the following risks, with their respective ratings: a) Technical risks are negligible to low. These are related to the sophisticated equipment supported by the project. All the beneficiary agencies have the qualified staff, resources, and organization to operate these systems. b) Financial risks are negligible to low. These are related to the sustainable funding for air transport safety and security. These risks should become even more negligible as increased revenues from air transport are expected with the air transport industry s growth in Nigeria. However, greater attention needs to be paid to the utilization of such funds: they should go to aviation purposes, while a clearer strategy should be in place to make sure that the right priorities are addressed first. c) Economic risks are negligible to low. Project achievements were resilient to the global financial crisis which hit at the middle of the project implementation period. It is expected that having been resilient to this extreme, project achievements should be in a better position to face similar circumstances in the future. d) Government ownership/commitment risks are moderate to substantial, as government ownership and commitment waivered in the latter years of project implementation. 75. In term of mitigating factors, the Bank is continuing the dialogue in close collaboration with ECOWAS Commission in order to promote further regional collaboration at the regional level. The President of Cote d Ivoire has been appointed as champion to continue to push the implementation of the Yamoussoukro decision. Within this framework, a number of planning and regulatory instruments have been adopted. The ECOWAS Air Transport Committee has updated their Action Plan for the period , and an Air Transport Roadmap is being elaborated, to be presented to the President of Head of States at ECOWAS level. At the WAEMU level, a model of the Civil Aviation Code for the WAEMU State members have been adopted; likewise, standard regulations at the sub-regional level have also been adopted 21

34 (limitation of the air carriers responsibility in case of accidents; and security regulations and procedures). 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry 76. Rating: The Bank performance in ensuring quality at entry is rated Moderately Satisfactory for the following reasons. 77. Overall the project was well prepared and offered a timely answer to the Government s request for assistance to enhance air safety and security in Nigeria. The alignment of WCAASSTP s Development Objectives and strategy with the sectors challenges at the time of identification yielded positive support from the Government which in turn helped mobilize line ministries and authorities during preparation. The project did not depart significantly from the APL Phase 1; therefore, the preparation phase was fast and it benefited from the experience gained from Phase 1 as shown in section 3.1. The project results framework helped monitor outcomes and initial targets and proved to be an effective tool for monitoring and evaluation. 78. However, the capacity of the project implementation entities to effectively manage the project considering the independence and autonomy of all the implementing agencies was underestimated. The PAD did recognize that the implementation arrangements selected were complex and risky but were justified by the desire to have the five key parastatal agencies involved in air transport playing a role in the implementation of activities in order to increase ownership and improve capacity at agency level and to promote inter agency cooperation and dialogue. The team stressed the need for the agencies to collaborate and recommended that the PCU be located in the Ministry of Aviation to ensure greater oversight through frequent dialogue with PIUs. This design approach turned up to be less effective than initially envisioned. As explained in the Risks section of this ICR, project preparation files show that the Bank project team s initial rating of overall project risks was High. This initial risk assessment was however lowered in the final PAD due to strong push back of the Government at the time of Negotiations, to which Bank management agreed. Diluting the overall risk assessment of the project at the time of appraisal/negotiations may have sent a wrong signal to Government. (b) Quality of Supervision 79. Rating: Satisfactory. The Bank performance during implementation was satisfactory for the following reasons: 80. Bank implementation support was proactive, identified problems early on, and provided practical solutions. Project supervision was adequately carried out, with team staffed with the necessary skills. Regular audio and video conferences were held in-between actual site visit missions. The Bank had a good understanding of the high risks of the project, and had an intimate knowledge of air transport in Nigeria and WCA, as well as familiarity with Nigeria s environment. 22

35 81. There was a very high level of commitment by Bank staff to resolving project implementation issues and clear communication from Bank management to the client on critical issues identified. This had been a major challenge given the frequency of top ministry hierarchy changes during project implementation. The Bank team provided practical solutions to problems, and found ways to help the PCU strengthen its oversight capacity, and PIUs were given specific attention to strengthen their technical capacity. For instance, almost half way through implementation, the Bank team devised a detailed action plan with the PCU which included: (a) monthly deployment from Abuja to Lagos of the PCU procurement specialist to speed up procurement activities within each beneficiary agency; (b) monthly Video Conferencing between the Bank team and the PCU to monitor Action Plan implementation and to keep them on their toes; and (c) strengthening of the PCU management Team. These corrective set of actions were taken as soon as the challenges became evident prior to Mid-Term which, as a consequence, was not perceived as an opportunity to make major changes. The declaration of mis-procurement for the ILS/VORE DME contract was an illustration of the Bank team s effective supervision. 82. Bank team reporting on implementation status was adequate. Aide memoires and Implementation Status Reports (ISRs) were sufficiently detailed, well written and candid in their assessments, and highlighted emerging or pressing key issues, with detailed action plans, responsibilities and next steps. Performance ratings given in the ISRs were overall realistic and sufficient attention was paid to the project s likelihood to achieve its development objectives. (c) Justification of Rating for Overall Bank Performance 83. Bank performance is rated Moderately Satisfactory consistent with the evaluation of each section above. 5.2 Borrower Performance (a) Government Performance 84. Government performance is rated Moderately Unsatisfactory for the following reasons. 85. Despite the continuous commitment of the government to the project and its objectives, Government actions on practical matters to ensure smooth project implementation and a larger institutional strengthening in the sector fluctuated throughout the lifespan of the project. This caused delays during project preparation and implementation. It has to a certain extent impacted the overall quality, scope and sustainability of the outcomes achieved. 86. It took more than 11 months after Board approval for the project to be declared effective, this delayed implementation activities and may have been partly responsible for the initial extension requested, a typical challenge experienced in Nigeria due to the internal approval processes. 87. The Aviation Ministry experienced frequent leadership changes from the Minister, Permanent Secretary to Directors. Every new team had different views about the project activities and naturally wanted to re-evaluate all donor funded projects agreed upon by their predecessors. The frequent leadership changes slowed down project implementation due to limited understanding of the project's implementation framework, goals and objectives. Such a high rate of turnover affected the quality of the policy and technical dialogue between the 23

36 government and the Bank. The latter years of project implementation in particular suffered from fading government commitment, as air transport was no longer considered a priority. 88. Therefore, the request to implement some project activities did not receive prompt approval or in most instances were not approved. Some examples include the processing of the restructuring/reallocation request of about US$11 million uncommitted funds (about 25 percent of project funds) which had to be cancelled at the end of the project. This resulted in an inability to fully implement the procurement plan which contained some important trainings and provision of goods and equipment for the PIUs. 89. The Aviation Ministry was also unable to convene the Project Steering Committee (PSC), chaired by the Permanent Secretary of the Aviation Ministry, every quarter as enshrined in the PAD. The PSC was to have provided strategic guidance to the project and intervening where it needed to assist the project achieve its PDOs. (b) Implementing Agency or Agencies Performance 90. The implementing agencies performance is rated as Moderately Unsatisfactory. 91. Implementing agencies performance was not uniform during project implementation. NCAA was the best performing agency as it not only completed nearly all of its scheduled activities, but also played a key role in enhancing the safety and security of Nigeria s civil aviation. NAMA s performance was adequate, but the mis-procurement case undermined its performance. FAAN and NCAT were able to implement majority of their subcomponents using government funding. 92. The project design took into account the risks concerning implementation capacity by the beneficiary agencies PIUs. This led to the creation of a single PCU charged with procurement and financial management on the project. The PCU was to also have overall oversight functions and provide quality control over the output of the PIUs. From the beginning, the capacity of the PCU and PIUs was weak. 93. Through the recruitment of additional expertise, the trainings of existent staff, the capacity of the project was greatly improved. This led to the overcoming of the initial challenges experienced on the project. Once these hiccups were overcome the project was implemented at a satisfactory pace. 94. Due to the initial challenges experienced in getting the project effective and the attendant time loss, an extension of almost two years was requested to implement the remaining activities on the procurement plan, but only a year s extension was granted. These activities were agreed by the client and the Bank to still be relevant to the PDO. However, project implementation started to suffer after the first closing extension was granted in June 2011 due to the previously stated lack of interest in the project s priorities and objectives as shown by the ministry. 95. In December 2011, the GON requested a 2 nd extension of the project arguing that the remaining activities could not be completed within the 1 year period granted by the Bank. The air crash that occurred June 3, 2012 involving a Nigerian registered aircraft operated by Dana Air provided additional justification for the request for an extension. Against this background, both the Government and the Bank discussed concrete actions aimed at using the remaining funds to strengthen aviation safety in Nigeria. The submission of the proposal for reallocation was delayed by the Ministry of Aviation, based on its differing views about project activities. The PCU was unable to secure timely Ministerial approval for the submission of the restructuring 24

37 request and the necessary permissions to commence on the outstanding procurements and trainings. While the Bank team and the PCU continued to work on the proposed new activities to be financed by the remaining funds, the Ministry of Aviation did not officially respond to the PCUs proposal to restructure the project until May Given that the project closed in May 2013, the reallocation was not finalized and the proposed activities were not achieved. Finally, in relation to Dana air crash mentioned above, the PCU lost two of its key principal staff whom where on Bank mission - the Project Accountant and the Procurement Officer. 96. At project closure a total of about XDR8.8 million was canceled from the project, made up of XDR1.5 million due to mis-procurement and XDR7.3 million due to unutilized funds. This represented about 28 percent of the total project credit but did not significantly impact the PDOs achievement since the activities carried out under the project s implementation already contributed to this, as explained in the pertinent section above. However, the completion of the dropped activities (especially the additional training) subsequent to the incompletion of the project s restructuring would have increased the number of qualified staff and would have allowed the project bridge the 2% and 5% shortfalls of its targets for both safety and security areas and further contributed to a more satisfactory achievement of those PDOs. (c) Justification of Rating for Overall Borrower Performance 97. Rating: Borrower performance is rated Moderately Unsatisfactory consistent with the evaluation of each section above 6. Lessons Learned 98. Lessons learned in relation to project preparation and design are the following: Need to adequately address in project design the lack of managerial autonomy of beneficiary entities. The project management structure was designed to give the implementing agencies some independence but in reality their activities can impacted by political factors outside their control. Therefore, deliberate provisions should be made for greater and constant advocacy of projects and their intended outcomes so that policy makers and political actors are adequately briefed and carried along. For example, an onboarding program for new political actors implementing donor assisted programs can be designed and anchored in the Federal Ministry of Finance to facilitate implementation. Political economy context. The transformation of the air transport sector is a very challenging endeavor because of the nature of the sector itself due to vested interests and political interference. These need to be taken into account when shaping a reform agenda in this sector. Flexibility in a dynamic environment. Given that working with the federal government in Nigeria is dynamic and fluid, the project design should be flexible enough to adapt to changing requirements over implementation. These changes could arise due to an inadequate design, inadequate client commitment, and sudden change in client priorities. Do not underestimate bureaucratic processing timeline. The delays experienced in getting the required government approvals were quite severe be it the effectiveness time lag or the inability to formalize project restructuring before project closing, which almost jeopardized the achievement of the development objective. This needs to be mitigated 25

38 with clear commitments in advance and realistic project preparation and implementation schedule. As this is an issue that affects nearly all Bank-funded projects in Nigeria, it is necessary for World Bank and GON to address this structural issue in a systemic manner. Need for robust procurement assessments and technical assistance to ensure that project activities can be procured efficiently and in a timely fashion. This should also help develop in already established entities, such as the ones that benefited from the project, internal organizational capacity for project implementation regardless of the funding sources. Need to simplify project design in a complex and challenging implementation environment. The issues meant to be addressed by the WCAATSS Program are complex, and despite significant project design simplification, WCAATSSP remained relatively sophisticated for the implementing entities especially for regional countries with weaker institutions. It is therefore suggested that despite its horizontal regional approach, programs of this nature should attempt to have simple project design depending on the implementation environment and the level of sector governance in the particular country. 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (a) Borrower/implementing agencies 99. A summary of the Borrower s ICR has been provided in Annex 7. Technical comments on the draft ICR were received from the PCU and PIUs and have been reflected in accordingly. (b) Cofinanciers Not applicable. (c) Other partners and stakeholders Not applicable. 26

39 Annex 1. Project Costs and Financing (a) Project Cost by Component (in USD million equivalent) Components Original Appraisal Estimate USD million Actual/ Latest Estimate USD million Percentage of Appraisal Aviation Safety Improvements Aviation Security Improvements Project Management and Governance Oversight Total Baseline Cost Total Project Costs (b) Financing (in USD million equivalent) Source of Funds Original Appraisal Estimate USD million Actual/Latest Estimate USD million Borrower 3.11* 3.11** Percentage of Appraisal IDA % Total % * Represents government in-kind contribution to component 3 Management and Governance Oversight of the Project in terms of manpower and office space ** Actual figures not available 27

40 NCAA Annex 2. Outputs by Component Table 2.1: Achievements by Component Agency Component 1 Aviation safety improvements Component 2 Aviation security Improvements Replacement of basic communications and inspections equipment (e.g., VHF radios, IT network at headquarters, etc.); ACHIEVED Purchase of technical library equipment (e.g., relevant ICAO s manuals, directives, online library, training materials, etc.); ACHIEVED Training of civil aviation staff in the area of civil aviation safety oversight; and ACHIEVED Establishment of an in-house personnel training center; PARTIALLY ACHIEVED Note: Training Center equipment were purchased by the project, while NCAA constructed the training center through government funds Installation of a security system and an access control system at headquarters; NOT ACHIEVED Training of civil aviation staff in the area of civil aviation security; ACHIEVED FAAN Acquisition of firefighting equipment; and ACHIEVED Training of airport safety personnel; ACHIEVED Acquisition of basic communications and inspections equipment for airport personnel (e.g., VHF radios, IT network at headquarters, etc.); ACHIEVED Strengthening of airport security (design of airport emergency plans and installation of airport personnel identification equipment, security cameras and, communications systems); NOT ACHIEVED Construction, within each airport s operational perimeters of a single aircraft remote parking zone in the event of a crisis; NOT ACHIEVED Rehabilitation and/or construction within existing airport buildings of crisis centers, including acquisition of necessary communication and surveillance tools to equip these centers; NOT ACHIEVED Improvement of airport security through the acquisition of passengers and cargo X-ray machines, as well as an explosive material tracer; NOT ACHIEVED Training of airport security personnel; ACHIEVED Agency Component 1 Aviation safety improvements Component 2 Aviation security Improvements NAMA Replacement of the satellite communication system and extension of VHF coverage pending the results of a prior exploratory study of satellite communication system needs; ACHIEVED Acquisition of resource software and information and document management system as identified by the institutional study financed under Nigeria s ERGP; PARTIALLY ACHIEVED Note: Enterprise Resource Software design was achieved while the information and document management systems was not achieved due to the delay of approval of the activity launch at the Ministry level. Installation of a local area network at tower controls of Lagos, Abuja, Port Harcourt and Kano airports; and ACHIEVED Training for air traffic control personnel based on a prior needs assessment study. ACHIEVED Agency Component 1 Aviation safety improvements Component 2 Aviation security Improvements NCAT Acquisition of two basic flight simulators; NOT ACHIEVED Note: Replaced with the refurbishment and re-commissioning of existing NCAT simulators, contract was awarded but cancelled due to challenges in establishing letters of credit Purchase and Installation of runway lights, Instrument Landing System (ILS) and VHF Omnidirectional Range navigation System (VOR) for the School s airport to enable night flight operations training; NOT ACHIEVED Construction/Expansion of a non-destructive testing, 28

41 Agency Component 1 Aviation safety improvements Component 2 Aviation security Improvements cartography and a ATN/AFTN/AHMS laboratories within NCAT s premises; NOT ACHIEVED Purchase and Installation of Fire Fighting training equipment based on a prior needs assessment study and a Memorandum of Understanding16 with the involved agencies; ACHIEVED Personnel training based on a prior needs assessment study; ACHIEVED NIMET Supply of Upper Air Consumable and other spare parts for Automated Weather Observing System; NOT ACHIEVED Training of Weather Forecasters; ACHIEVED Table 2.2: Status of Unachieved Project Sub-Components Agency Activity Comment Component NCAA Re-certification of Airlines operating in Nigeria Construction and equipping of training center in Lagos 1st phase completed using project funding and other phases funded using NCAA IGR Construction was carried using NCAA IGR; equipment and library materials were funded under the project Component 1 Aviation safety improvements Component 1 Aviation safety improvements FAAN X-Ray machines, Walk Through Scanners, Body and baggage Scanners ID Badge System Consultancy and Equipment Purchased by FAAN using IGR and deployed at the major international airports Bank funded consultancy recommendations have been implemented at only MM International Airport Lagos using FAAN IGR Component 2 Aviation security Improvements Component 2 Aviation security Improvements CCTV System Consultancy and Equipment Implemented using FAAN IGR Component 2 Aviation security Improvements Rehabilitation and/or construction within existing airport buildings of crisis centers, including acquisition of necessary communication and surveillance tools to equip these centers Using IGR Abuja Center has been built and is in use, while Lagos has been built but usage is yet to commence Component 2 Aviation security Improvements Acquisition of firefighting equipment Airport wailer- bird deterrent equipment Replacement of the satellite communication system and extension of VHF coverage pending the results of a prior exploratory study of satellite communication system needs 28 fire tenders were purchased by Component 1 Aviation safety FAAN using IGR and have been improvements deployed nationwide. These 28 are in addition to the 10 procured under the project which were mainly deployed to the 4 main international airports and NCAT Purchased by FAAN using IGR and Component 1 Aviation safety deployed at the major international improvements airports. However wild life department has now been transferred to NAMA (inclusive of equipment and personnel) Consultancy was funded by the project and total VHF coverage of the Nigerian airspace was achieved using NAMA IGR Component 1 Aviation safety improvements NAMA Acquisition of resource software and information and document management system as identified by the institutional study financed under Nigeria s ERGP Not achieved but design has been completed and financed by the project Component 1 Aviation safety improvements ILS/VOR/DME Systems System procured using NAMA IGR and is operational in Abuja airport Component 1 Aviation safety improvements 29

42 Agency Activity Comment Component Acquisition of two basic flight simulators NCAT purchased two (2) Nos ALSIM ALX Flight simulators. Component 1 Aviation safety improvements NCAT Purchase and Installation of runway lights for NCAT Aerodrome, Contract under implementation and will be concluded July 2014 Component 1 Aviation safety improvements ILS/DMW/VOR Procurement programmed under the college's medium term expenditure framework Component 1 Aviation safety improvements NIMET Low Level Windshear Alert System Component 1 Aviation safety Installed at the 4 major airports as improvements envisaged by the project. Now being extended to other airports in the country 30

43 Table 2.3: Project Development Objective Indicators Project Development Objective Indicators Main Project Output Indicators Activities Target Actual Outcome/Comments Key Performance Indicator 1: Improve CAAs compliance with ICAO s safety standards Compliance rate with ICAO s safety standards Equipment and training for Search and Rescue activities; Installation and upgrade of local area networks at control tower of targeted airports; Purchase of technical library equipment (e.g. relevant ICAO s manuals, directives, online library, training materials, etc.); Recertification of the Aviation Industry. >90% 88% Results from an Independent ICAO safety oversight audit conducted in May 2013 Percentage of technical personnel in compliance with ICAO s safety standards Training of civil aviation staff in the area of civil aviation safety oversight; based on a prior needs assessment study. >90% 88% Results from an Independent ICAO safety oversight audit conducted in May

44 Total NCAA budget level US$42 million US$61 million Achieved Key Performance Indicator 2: Increase CAA s compliance with ICAO s security standards Compliance rate with ICAO s security standards Percentage of NCAA ICAO s certified security inspectors trained during the last three years Improvement of airport security through the acquisition of passengers and cargo x-ray machines as well as an explosive material tracer; Acquisition of airport personnel identification equipment, security cameras, communications systems, and inspection equipment; Training of civil aviation staff in the area of civil aviation security; Training of airport security personnel. >90% 85% Results from an Independent ICAO safety oversight audit conducted in May 2013 >90% 90% Results from an Independent ICAO safety oversight audit conducted in May 2013 Level of NCAA budget dedicated to security Key Performance Indicator 3: Enhance main international airports compliance with ICAO s security standards Percentage of airport security personnel with three or more years of experience US$1.5 million US$0.8 million Not Achieved. Figures from NCAA budget >90% 82% Results from an Independent ICAO safety oversight audit conducted in May

45 Number of serious problems recorded during annual airport crisis exercise Percentage of embarking passengers stopped in possession of illegal objects as defined by the ICAO by private airlines security personnel. <3/airport <4/airport Results from an Independent ICAO safety oversight audit conducted in May 2013 <2% 3% Results from an Independent ICAO safety oversight audit conducted in May

46 Annex 3. Economic and Financial Analysis 1. The Project Appraisal Document (PAD) recognized that measuring the economic benefits of the project (and the regional program as whole) would require forecast data about the quantitative impact of putting in place measures that would strengthen safety and security of air transport in the country (and the region as a whole). No such information is available, however, and no cost-related data can be obtained to make relevant computations. Furthermore, the nature of the investments financed (i.e. airport security infrastructure and equipment, safety and security training) make any quantification of these benefits difficult as these investments are among many others necessary to strengthen the aviation sector s growth potential. The PAD therefore highlighted the impact, at the time of appraisal, on the aviation sector globally in Sub-Saharan Africa based on available studies and surveys. More specifically, the PAD highlighted the major impacts that the project would have on tourism, travel fares, trade and investment in Africa. 2. The Implementation Completion and Results Report (ICR) confirms the PAD s view that the assessment of the project s direct economic impacts would be complex and the uncertainty of the assumptions that would need to be made for such an analysis would weaken its validity. The ICR s rating of efficiency as Satisfactory is therefore based on a review of how air transport has performed in recent years in Nigeria and how the key agencies have performed from a financial stand-point. The ICR also reviewed recent literature of the economic impact of air transport on Nigeria s economy. The assumption is that the project s focus on safety and security, with reasonable costs by industry standards, was instrumental in supporting the development of air transport market in Nigeria. This assumption is reasonable, for example in neighboring countries where the issues of safety and security were not addressed in a similar manner, such as in the Democratic Republic of Congo, air transport has failed to develop despite the huge potential demand. 3. During project implementation, demand for air transport dramatically increased in Nigeria (Figure 1). According to Federal Airports Authority of Nigeria (FAAN) figures, passenger traffic across all airports in Nigeria (domestic and international) has increased by an annual average of more than 15 percent per year, and therefore more than doubled during project life. The statistics show that airport passenger traffic has increased from 8.4 million passengers in 2007 to 15.1 million in 2011 and 14.4 million in 2012, hence more than 10 percent annual increase during the course of project implementation. Reduced passengers number in 2012 over 2011 reflects bankruptcy of a many large airlines in 2012 in Nigeria and the impact of this phenomenon on domestic demand. With regard to the various agencies financial performance, audited financial statements show that FAAN revenues increased from N17.52 billion in 2006 to N28.04 billion in 2010; NCAA N5.85 billion in 2007 to N8.94 billion in 2011; and NAMA N6.2 billion in 2007 to N13.6 billion to 2011; all this with relatively stable operating costs especially for NCAA. 34

47 Figure 1: Evolution of Airport Traffic and Sector Revenues (2007=100%) 200% Traffic Revenues (NCAA, FAAN, NAMA) Inflation 180% 160% 140% 120% 100% 80% As for the quantification of the economic impacts of air transport in Nigeria, the most comprehensive assessment to date in Nigeria was undertaken by the research firm Oxford Economics in 2012 using 2010 data, and the results are available in the report Economic Benefits from Air Transport in Nigeria, published in The key findings of the research were that in 2010 the civil aviation sector contributed 0.4 percent of Growth Domestic Product (GDP) to Nigeria s economy, and it supported 159,000 jobs or 0.3 percent of the Nigerian workforce. When the sector s contribution as an enabler of the tourism industry is included, these figures rise to 0.6 percent of Nigeria s GDP and 289,000 jobs, or 0.5 percent of the workforce. It is significant to note that these are high productivity jobs. The annual estimated value added or Gross Value Added by each employee in air transport services in Nigeria in 2010 was N3.5 million, nearly seven times higher than the Nigerian average. 5. Consumer benefits of air transport were also estimated. It was estimated that passengers pay N866 billion (inclusive of tax), and that the value of the benefit to travelers from flying in excess of their expenditure is worth N785 billion a year. Similarly, freight shippers pay airlines N89 billion annually, and the benefits to shippers in excess of this expenditure was estimated at N37 billion. 6. In addition to its economic impacts, the civil aviation sector s tax base in Nigeria is large and the tax revenues derived from it are substantial. Nigerian-based aviation companies paid an estimated N8.5 billion annually in direct taxes and social security payments. Passengers paid a further N17.0 billion in Value Added Taxes on domestic and international flights originating in Nigeria. It is estimated that an additional N8.9 billion of government revenue is raised via the aviation sector s supply chain and N7.1 billion through taxation of the activities supported by the spending of employees of both the aviation sector and its supply chain, this leads to a total of N41.5 billion or about $256 million estimated for

48 Annex 4. Bank Lending and Implementation Support/Supervision Processes (a) Task Team members Names Title Unit Responsibility/ Specialty Lending Pierre Pozzo di Borgo Principal Investment Officer CN2SI Sector Specialist Justing Runji Senior Transport Specialist AFTTR Transport Warren Waters Consultant AFTEN Environment Sameena Dost Senior Legal Counsel LEGES Legal Chau-Ching Shen Senior Finance Officer CTRLN Disbursement Africa Eshogba Olojoba Sr Environmental Specialist MNSEE Environmental Safeguards Christopher Cozzone Temporary AFTTR ACS Akinrinmola Oyenuga Akinyele Sr Financial Management Specialist AFTMW Financial Management Bayo Awosemusi Lead Procurement Specialist AFTPW Procurement Sariette Jene M. C. Jippe Program Assistant AFTHW ACS Antoine Lema Sr. Social Development Specialist AFTCS Social Safeguards Sariette Jene M. C. Jippe Program Assistant AFTHW ACS Supervision/ICR Noroarisoa Rabefaniraka Senior Transport Specialist AFTTR Task Management Mohammed Aliyu ET Consultant/ICR Primary Author AFTTR Sector Specialist Bertrand Murguet Consultant AFTTR Sector Specialist Sunday Achile Acheneje Procurement Specialist AFTPE Procurement Senior Financial Management Akinrinmola Oyenuga Akinyele AFTMW Financial Specialist Management Mary Asanato-Adiwu Senior Procurement Specialist AFTPW Procurement Bayo Awosemusi Lead Procurement Specialist AFTPW Procurement Roukaya El Houda Temporary AFTTR ACS Sariette Jene M. C. Jippe Program Assistant AFTHW ACS Aisha Donald Kaga Senior Executive Assistant AFCW2 ACS Ms. Miakukila-Kubauka Procurement Assistant AFTTR Procurement Regina Oritshetemeyin Nesiama Senior Program Assistant ECSSD ACS Anne Njuguna Country Program Assistant MNCA2 ACS Wycliffe Okoth Temporary AFTA1 ACS Africa Eshogba Olojoba Senior Environmental Specialist MNSEE Environmental Safeguards Joseph Ese Akpokodje Senior Environmental Specialist AFTN1 Environmental Safeguards Justin Runji Senior Transport. Spec. AFTTR Sector Specialist Olatunji Ahmed Transport Specialist AFTTR Sector Specialist Ismail Sentissi El Idrissi Temporary AFTTR ACS Rafael Treibich Temporary AFTTR ACS Schlumberger Charles E Lead Air Transport Specialist TWITR Sector Specialist 36

49 (b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) Stage of Project Cycle USD Thousands (including No. of staff weeks travel and consultant costs) Lending FY FY Total: Supervision/ICR FY FY FY FY FY FY FY FY Total:

50 Annex 5. Beneficiary Survey Results (N/A) 38

51 Annex 6. Stakeholder Workshop Report and Results (N/A) 39

52 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR FEDERAL MINISTRY OF AVIATION EXECUTIVE SUMMARY REPORT ON IMPLEMENTATION OF THE WORLD BANK ASSISTED PROJECT WEST AND CENTRAL AFRICA AIR TRANSPORT SAFETY AND SECURITY PROGRAM (WCAATSSP) FEBRUARY,