FOR OFFICIAL USE ONLY INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT PAPER ON A PROPOSED ADDITIONAL GRANT AND RESTRUCTURING

Transcription

1 Public Disclosure Authorized Document of The World Bank FOR OFFICIAL USE ONLY Report No: PAD2348 Public Disclosure Authorized Public Disclosure Authorized INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT PAPER ON A PROPOSED ADDITIONAL GRANT AND RESTRUCTURING IN THE AMOUNT OF SDR 14.6 MILLION (US$20.0 MILLION EQUIVALENT) FROM CRISIS RESPONSE WINDOW RESOURCES TO THE REPUBLIC OF HAITI FOR A DISASTER RISK MANAGEMENT AND RECONSTRUCTION PROJECT Public Disclosure Authorized May 25, 2017 Social, Urban, Rural and Resilience Global Practice Latin America and Caribbean Region This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank s policy on Access to Information.

2 CURRENCY EQUIVALENTS (Exchange Rate Effective: April 30, 2017) Currency Unit = Haitian Gourdes (HTG) HTG = US$1 US$1.37 = SDR 1 FISCAL YEAR October 1 September 30 AF CCPC CERC CNIGS CNMP CRW DPC DRM DRMRP EMP ESMF ESMP EU FGHI GDP GoH GRM IDAT IDB IDWT IP IT LIW MICT MTPTC OM PDNA PDO ABBREVIATIONS AND ACRONYMS Additional Financing Municipal Civil Protection Committee (Comité Communal de Protection Civile) Contingent Emergency Response Component National Geospatial Information Center (Centre National de l'information Géo-Spatiale) National Commission of Public Contracts (Commission Nationale des Marchés Publics) Crisis Response Window Directorate of Civil Protection (Direction de la Protection Civile) Disaster Risk Management Disaster Risk Management and Reconstruction (Projet de Gestion des Risques et des Désastres et Reconstruction) Environmental Management Plan Environmental and Social Management Framework Environmental and Social Management Plan European Union Hurricane Fay, Gustav, Hannah and Ike Gross Domestic Product Government of Haiti Grievance Redress Mechanism International Development Association Inter-American Development Bank International Development Association - Crisis Response Window Implementation Progress Information Technology Labor Intensive Work Ministry of Interior and Regional Authorities (Ministère de l Intérieur et des Collectivités Territoriales) Ministry of Public Works, Transportation, and Communication (Ministère de Travaux Publics, Transport et Communications) Operational Manual Post-disaster Needs Assessment Development Objective

3 PIU PPSD RAI RAP RN RD RPF SBD SME SNGRD UCE UCP Implementation Unit Procurement Strategy for Development Rural Access Index Resettlement Action Plan National Road (Route Nationale) Departmental Road (Route Departmental) Resettlement Policy Framework Standard Bidding Document Small and Medium Enterprise National System for Disaster Risk Management (Système National de Gestion des Risques et des Désastres) Central Execution Unit (Unité Centrale d Exécution) Coordination Unit (Unité de Coordination de Projet) Vice President: Country Director: Senior Global Practice Director: Practice Manager: Task Team Leaders: Jorge Familiar Mary Barton-Dock Ede Jorge Ijjasz-Vasquez Ming Zhang Pierre Xavier Bonneau and Sergio Dell Anna

4 HAITI ADDITIONAL FINANCING TO THE DISASTER RISK MANAGEMENT AND RECONSTRUCTION PROJECT CONTENTS I. Introduction...1 II. Background and Rationale for Additional Financing in the amount of SDR14.6 million...1 A. Country Context... 1 B. Situation of Urgent Need of Assistance or Capacity Constraint... 2 C. Sectoral and Institutional Context... 3 D. Higher Level Objectives To Which The Contributes... 4 E. Parent Background... 4 F. Status of Implementation... 5 G. Rationale for Additional Financing, Restructuring and Additional Benefits. 7 H. Policy Waiver... 8 III. Proposed Changes...9 A. Proposed Changes Data Sheet... 9 IV. Appraisal Summary...16 V. World Bank Grievance Redress...18 Annex 1: Revised Results Framework and Monitoring Indicators...19 Annex 2: Detailed Description...28 Annex 3: PPSD - Executive Summary for Procurement Plan and PPSD...32 Annex 4: Country Risk Profile to Natural Hazards and Climate Change...34 Annex 5: Ongoing Bank Response in the Transport and DRM Sectors...37 Annex 6: Emergency Support and Response under Existing IDA Operations...38 i

5 . ADDITIONAL FINANCINGDATA SHEET Haiti Disaster Risk Management and Reconstruction Additional Financing ( P ) LATIN AMERICA AND CARIBBEAN Social, Urban, Rural and Resilience Global Practice Basic Information Parent Parent ID: P Original EA Category: B - Partial Assessment Current Closing Date: ID: 30-Jun-2017 Basic Information Additional Financing (AF) P Regional Vice President: Jorge Familiar Country Director: Senior Global Practice Director: Practice Manager/Manager: Team Leader(s): Mary A. Barton-Dock Additional Financing Type (from AUS): Proposed EA Category: Expected Effectiveness Date: Ede Jorge Ijjasz-Vasquez Expected Closing Date: Restructuring, Scale Up 28-Aug Jun-2020 Ming Zhang Report No: PAD2348 Pierre Xavier Bonneau, Sergio Dell'anna Borrower Organization Name Contact Title Telephone Ministry of Economy and Finance Ronald Deshommes Directeur deshommesronald@y ahoo.fr Financing Data - Parent ( Disaster Risk Management and Reconstruction-P ) (in USD Million) Key Dates Ln/Cr/TF Status P IDA-H7460 Effectiv e Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date 01-Dec Jan Apr Dec Jun-2017 P TF Closed 29-Jul Jul Jul Jun Dec-2015 Disbursements Ln/Cr/TF Status Currency Original Revised Cancel led Disburse d Undisbu rsed % Disburse d ii

6 P IDA-H7460 Effectiv e USD P TF Closed USD Financing Data - Additional Financing Disaster Risk Management and Reconstruction ( P )(in USD Million) [ ] Loan [ ] Grant [X] IDA Grant [ ] Credit [ ] Guarantee [ ] Other Total Cost: Total Bank Financing: Financing Gap: 0.00 Financing Source Additional Financing (AF) Amount IDA Grant 0.00 IDA Grant from CRW Total Policy Waivers Does the project depart from the CAS in content or in other significant respects? Explanation No Does the project require any policy waiver(s)? Explanation In light of Haiti s high level of debt distress and situation of urgent need following Hurricane Matthew, this Paper seeks the approval of Executive Directors to provide SDR 14.6 million (US$20 million equivalent) from the IDA Crisis Response Window (CRW) for this proposed additional financing in the form of a grant, rather than on Haiti s current IDA terms. Haiti is a yellow light country, eligible for a mix of grants and credits in FY17 under its regular allocation and under any CRW allocation. However, the post-disaster Joint Debt Sustainability Analysis (DSA) for Haiti, circulated to Executive Directors on November 16, 2016, finds the country at high risk of debt distress following Hurricane Matthew. The provision of financing in the form of all grants for the proposed operation is appropriate, as the provision of credits would further heighten Haiti s risk of debt distress at a time of urgent need. On the basis of the November 2016 DSA, in FY18, Haiti will become eligible again for 100 percent grant financing from IDA. Has the waiver(s) been endorsed or approved by Bank Management? Explanation The waiver was endorsed by Bank Management on May 13, 2017 and would be considered and approved by the Executive Directors in the context of their consideration of and approval of this Board package. Bank Staff Team Composition Name Role Title Specialization Unit Yes Yes iii

7 Pierre Xavier Bonneau Team Leader (ADM Responsible) Sergio Dell'anna Team Leader Disaster Risk Management Specialist Rose Caline Desruisseaux-Cadet Lydie Madjou Aboubacar Magassouba Asli Gurkan Procurement Specialist (ADM Responsible) Financial Management Specialist Program Leader Transport LCC8C Procurement Specialist Financial Management Specialist Disaster Risk Management Procurement Financial Management GSU10 GGO04 GGO22 Team Member Consultant Procurement GGO04 Safeguards Specialist Senior Social Development Specialist Fabienne Mroczka Team Member Sr Financial Management Specialist Social Development Financial Management GSU04 GGO22 Faly Diallo Team Member Finance Officer Finance officer WFALA Felipe Jacome Isabella Micali Drossos Safeguards Specialist Consultant Social Development GSU04 Counsel Senior Counsel Senior Counsel LEGLE Malaika Becoulet Team Member Consultant Transport & Disaster Risk Management Margaret Patricia Henley Barrett Nyaneba E. Nkrumah Team Member Consultant Disaster Risk Management & Urban Safeguards Specialist Sr Natural Resources Mgmt. Spec. Environment Rafael Van der Borght Team Member DRM Analyst Disaster Risk Management Extended Team Name Title Location GTI04 GTI04 GEN04 GSU10 Alanna Simpson Sr. DRM Specialist/Peer Reviewer Washington DC Gregoire Gauthier Sr. Transport Engineer/Peer Reviewer Washington DC Michel Matera Sr DRM Specialist/Peer Reviewer Maputo, Mozambique Kiran Pandey Consultant Washington DC Rajagopal S. Iyer Consultant Washington DC iv

8 Locations Country First Administrative Division Haiti Departement du Sud Departement du Sud Haiti Haiti Haiti Haiti Haiti Departement de la Grand'Anse Location Planned Actual Comments Departement de la Grand'Anse Departement de Nippes Departement de Nippes Departement du Nord- Ouest Departement du Nord-Ouest Departement de l'ouest Departement de l'ouest Departement du Nord- Est Departement du Nord-Est Haiti Departement du Nord Departement du Nord Haiti Haiti Haiti Departement du Sud- Est Departement du Sud-Est Departement du Centre Departement du Centre Departement de l'artibonite Departement de l'artibonite Institutional Data Parent ( Disaster Risk Management and Reconstruction-P ) Practice Area (Lead) Social, Urban, Rural and Resilience Global Practice Contributing Practice Areas Additional Financing Disaster Risk Management and Reconstruction ( P ) Practice Area (Lead) Social, Urban, Rural and Resilience Global Practice Contributing Practice Areas Transport & ICT Consultants (Will be disclosed in the Monthly Operational Summary) Consultants Required? Consulting services to be determined X X X X X X X X X X TA only TA only TA only TA only TA only TA only TA only v

9 I.Introduction 1. This Paper seeks the approval of the Executive Directors to provide an additional grant in an amount of SDR14.6 million (US$20 million equivalent) to the Republic of Haiti for the Disaster Risk Management and Reconstruction (Projet de Gestion des Risques et des Désastres et Reconstruction, DRMRP - P126346). The proposed Additional Financing (AF) would be financed by IDA s Crisis Response Window (CRW) 1, the first operation in a package of a US$100 million of support from the World Bank to help the Government of Haiti recover and rebuild after Hurricane Matthew, which struck the country on October 4, This event was described and the proposed Word Bank response outlined in the Crisis Window Response Paper circulated to Executive Directors on January 22, 2017 and considered at a technical briefing held on January 26, In this context, Management underlined that funding from ongoing projects was mobilized to respond to immediate needs in the affected areas and proposed providing funding in the form of grants for the above-mentioned package, consisting of four additional financing operations in the Transport and Disaster Risk Management (DRM) sectors, the Health Sector, the Water Sector, and the Agricultural Sector to be financed from the Crisis Response Window. An estimated US$2.2 billion are needed for reconstruction and rehabilitation. The proposed AF would significantly expand the scope and impact of the parent by scaling up activities under all components of the project to support post-hurricane Matthew recovery and reconstruction in the most affected departments of Haiti. 2. Concurrently, the DRMRP would be restructured: (a) the closing date of the project would be extended by three years, to June 30, 2020 to allow for (i) the completion of activities that were deferred to allow the parent project to undertake emergency recovery and reconstruction activities starting in October 2016 (such as the construction of the Estimé Dumarsais bridge) and (ii) the implementation of additional recovery and reconstruction activities to respond to Hurricane Matthew; and (b) the Results Framework would be modified to monitor the results expected from the proposed additional activities. II.Background and Rationale for Additional Financing in the amount of SDR14.6 million A. Country Context 3. Haiti remains extremely vulnerable to natural disasters with more than 90 percent of the population at risk. On October 4, 2016, category 4 Hurricane Matthew struck Haiti s southwest coast, affecting over 2 million people, about 20 percent of the country s population. The Directorate of Civil Protection (Direction de la Protection Civile, DPC) of the Government of Haiti (GoH) reported 546 deaths, 128 missing, 439 injured, 175,500 people living in temporary shelters, and immediate humanitarian assistance needs for 1.4 million people (about 12.9 percent of the population). This natural catastrophe comes less than seven years after the devastating 1 Management informed the Executive Directors of its intention to allocate an indicative amount of US$100 million equivalent to support Haiti s response to the impact of the Hurricane Matthew at a technical briefing on January 26, See the note entitled "IDA Crisis Response Window Support for the Republic of Haiti Emergency Recovery and Reconstruction Following the Impact of Hurricane Matthew for additional information. 1

10 January 12, 2010 earthquake of magnitude 7.0 struck 25 km west of Port-au-Prince, Haiti s capital, which killed 220,000 people and displaced 1.5 million. 4. Reconstruction needs were assessed at 25 percent of gross domestic product (GDP) (US$2.2 billion) 2. The agriculture and housing/urban sectors were the hardest hit. Up to 90 percent of crops and livestock were lost in coastal areas, including stable food crops, but also cash and tree crops such as coffee, cocoa and vetiver. Thousands of structures were damaged and 75 percent of structures in the heaviest-hit communities in Grand Anse 3 were entirely destroyed. More than 100,000 houses were heavily damaged or destroyed, half of which were in Grand Anse. Key roads and bridges were washed away. The area s already limited water, sanitation, and energy infrastructure was damaged. Although damages and losses appeared more modest in the education and health sectors, the population was significantly affected by the damage and destruction of schools and the interruption of services at damaged or destroyed health centers. Over 450,000 children were estimated to remain out of school, the vaccine cold chain was destroyed, and a sharp increase in suspected cholera cases has been recorded in affected departments (the number of cases has since dropped but the risk of cholera spikes remains high). 5. This latest disaster has compounded Haiti s preexisting development challenges, increasing poverty and vulnerability, threatening livelihoods, and hampering already weak service delivery and human development outcomes. It also exacerbated Haiti s underlying socioeconomic drivers of poverty, such as social divisions and inequity, fragility of political mechanisms, the Government s weak capacity, risks of political instability, and persistent volatility. Almost 60 percent of Haiti s population, or 6.3 million people, remain poor, 4 and 24 percent (2.5 million) are extremely poor, with poverty highest in rural areas. The poorest regions, which are also the furthest from the capital, show extreme poverty rates exceeding 40 percent and have very limited access to basic services. B. Situation of Urgent Need of Assistance or Capacity Constraint 6. The proposed operation meets the criteria of OP Paragraph 12 (s in Situations of Urgent Need of Assistance or Capacity Constraints) and was processed through condensed procedures because: (i) Hurricane Matthew caused a national disaster and emergency; (ii) Haiti faces severe capacity constraints with under-resourced response systems in the Disaster Risk Management and Transport sectors which have limited ability to respond to all aspects of the disaster; and (iii) the shock caused by Hurricane Matthew threatens to deepen already widespread and entrenched poverty of the affected areas, among the poorest in the country. 7. Hurricane Matthew, the first hurricane of this magnitude to make landfall in Haiti in 52 years, has caused large-scale disaster mostly in the southern part of the country. The hurricane s high wind speeds, heavy rainfall, and devastating storm surge resulted in flooding, landslides, and extensive destruction of infrastructure and livelihoods, especially in the southern departments of Grand Anse, Nippes, and Sud, where 80 percent, 66 percent, and 65 percent of people, respectively, are poor (under the national poverty line of US$2.41 per day) and 36 percent, 2 October 24, 2016: Rapid Damage and Loss Assessment of Hurricane Matthew, the Government of the Republic of Haiti with joint support from the World Bank and the Inter-American Development Bank. 3 Communities of Maniche, Camp Perrin, Chantal, Beaumont, Duchity, Moreau, and Chambellan. 4 Under the Haitian poverty line of US$1.98 per day based on consumption. 2

11 30 percent, and 26 percent, respectively, are extremely poor (under the national extreme poverty line of US$1.23 per day). Lesser damage was seen in coastal areas in other parts of the country. 8. The GoH Damage and Loss Assessment of October 2016 estimated total losses and damages equivalent to 22 percent of the GDP (US$1.9 billion). This figure was later evaluated to be 32 percent of GDP by the Post-disaster Needs Assessment (PDNA) 5, with damage and losses specific to the transport sector due to the destruction of bridges and roads amounting to 17.7 percent of total damage and losses. In light of the magnitude of these damage and losses as well as Matthew s impact on the GoH s already limited capacity and resources and the urgent need for support in responding to the crisis, the use of expedited procedures to prepare this proposed AF is appropriate. C. Sectoral and Institutional Context 9. Haiti is highly exposed to hydrometeorological (hurricanes, high wind, excess rainfalls, landslides, and flooding) and geological (seismic and tsunami) hazards, with over 93 percent of its surface and more than 96 percent of its population at risk of two or more hazards. 6 Between 1971 and 2016, Haiti has been subjected to natural disasters almost every year with adverse effects on economic growth and fiscal stability. Nearly 75 percent of households are economically impacted by at least one shock each year. 7 In 2008, tropical storms and hurricanes caused losses estimated at 15 percent of GDP. The earthquake on January 12, 2010, killed 220,000 people, displaced 1.5 million people, and destroyed the equivalent of 120 percent of GDP. Hurricane Matthew hit Haiti at a time when it was just showing signs of recovery from previous events. 10. Climate change is anticipated to increase the frequency and severity of hydrometeorological hazards in Haiti, reinforcing the need to strengthen climate and disaster risk reduction policies to ensure sustainable development. Based on available information, 8 maximum temperatures will likely see an increase by 0.7 C during and by 1.7 C during , while minimum temperatures are projected to decrease by 0.7 C and 1.1 C, respectively, over the same period. Temperature fluctuations in the tropical zone are highly correlated with cyclonic events of increased duration and intensity, thus increasing the risk of cyclones in Haiti. In addition, the dry season will likely further intensify with a decrease of duration of 8 percent to 19 percent at the national level. Likewise, increase in maximum temperatures has led to given greater propensity to extreme rainfall events and flash floods in the previous years and this pattern is expected to be further exacerbated under the effects of climate change. In addition to claiming human lives, climate-related hazards are thus likely to take an increasing toll on all sectors of the Haitian economy and might reverse hard-won development gains. 5 February 6, 2017: Post-Disaster Needs Assessment, the Government of the Republic of Haiti with joint support from the European Union, the Inter-American Development Bank, the United Nations agencies, and the World Bank. 6 Global Hotspot Study, World Bank, Investing in people to fight poverty in Haiti: Reflections for evidence-based policy making, World Bank Climate Scenarios Simulation referenced here was developed in the framework of the Second National Communication of Haiti for the United Nations Framework Convention on Climate Change, Climate scenarios are based on historic data analysis and the Providing Regional Climate for Impact Studies climate model. 3

12 11. The transport sector continues to represent a major bottleneck to Haiti s social and economic development. Roads remain the primary mode of transportation for both people and goods, and infrastructure investments remain critical to Haiti s medium- and long term social and economic development. With about 80 percent of traffic by land, Haiti has a limited network 9 which suffers from a lack of maintenance, and from the impacts of climate change and variability. 10 Entire regions remain isolated during the rainy season, further exacerbated in the wake of an extreme natural event such as Hurricane Matthew. 11 Matthew s destruction of bridges and roads amounts to 17.7 percent of total damages and losses recorded in the country. 12. The World Bank has been supporting the transport sector nationwide since 2006, with a particular focus on critical spot interventions and on strengthening the road maintenance system to improve resilience and protection of assets. The DRMRP has financed a new methodology, the Rural Access Index (RAI), and the spot-improvement approach. It provides technical assistance to improve infrastructure investment identification and prioritization, asset management, both for emergency recovery and reconstruction activities, and in the medium to long term. The proposed AF would continue to provide institutional and structural support in both the transport and DRM sectors, including institutional support to the Ministry of Public Works, Transportation, and Communication (Ministère de Travaux Publics, Transport et Communications, MTPTC), the National Geospatial Information Center (Centre National de l Information Géo-Spatiale, CNIGS), and the DPC, and the financing of infrastructure recovery and reconstruction in the affected areas. D. Higher Level Objectives To Which The Contributes 13. The proposed AF contributes to the achievement of the World Bank Group s twin goals of ending extreme poverty and boosting shared prosperity by reducing disaster-related economic and livelihood losses, particularly for communities affected by Hurricane Matthew. It is consistent with the LCR Strategy, specifically on strengthening infrastructure services with a focus on sustainability and resilience. 14. The proposed AF is fully aligned with the World Bank Group s Country Partnership Framework (CPF) for FY16-19 discussed by the Executive Directors on September 29, It contributes to the strategic objectives of promoting inclusive growth (contribute to enhanced income opportunities) and resilience (strengthen natural disaster preparedness, improve disaster prevention, and strengthen climate resilience), and the cross-cutting objective of strengthening governance (improve capacity for sustainable basic service delivery). E. Parent Background 9 About 3,400 km: 700 km of national roads, 1,500 km of departmental roads, and 1,200 km of tertiary roads. 10 Precipitation, storms, flooding, and cyclones are most destructive to transport infrastructure. 11 Following the passage of Tropical Storms Fay, Gustav, Hannah, and Hurricane Ike over a four-week period in 2008, several regions in the country were completely isolated and the economy in the departments almost completely paralyzed. The Artibonite region faced catastrophic circumstances with major flooding in Gonaives, and access from both the north and south compromised due to the collapse of four major bridges (Montrouis, Ennery, Chalon, and Mirebalais). Numerous smaller bridges and road sections were also either destroyed or damaged. 4

13 15. Parent Grant (H746-0-HT). The IDA Grant for DRMRP in the amount of SDR 37.6 million (US$50.7 million equivalent) was approved on December 1, 2011, and became effective on April 3, The original closing date of the project was December 31, restructuring. In July 2016, the Grant closing date was extended six months from December 31, 2016 to June 30, The request for extension was originally 20 months to allow for the completion of several transport infrastructure rehabilitation activities and the reconstruction of a few critical shelters; however, a six-month extension only was approved given the fragile political climate. The restructuring also included two minor cost reallocations from Categories 2 and 3 to Categories 5.1 and 5.2, respectively, to cover the increased operational costs resulting from the extension. Finally, the Results Framework, which was prepared under the parent in a post-disaster environment, was revised to add a Development Objective (PDO) level indicator and several intermediate results indicators to better capture project activities. 17. The PDO of the DRMRP is to support the Recipient in improving disaster response capacity and enhancing the resiliency of critical transport infrastructure. The achievement of the PDO is supported by five project components: (i) natural hard risk assessment and analysis; (ii) support to disaster preparedness and emergency response; (iii) rehabilitation of vulnerable and damaged critical transport infrastructure; (iv) emergency response and recovery; and (v) project management and implementation support. The proposed AF will support all components of the project, as described in the Financing Agreement. F. Status of Implementation 18. The implementation of the DRMRP is proceeding reasonably well, with both implementation progress (IP) and achievement of PDOs rated Moderately Satisfactory. The is well-performing, it has been rated Moderately Satisfactory consistently over the last 12 months and is likely to achieve the PDO indicators. In particular, the is progressing in supporting line ministries develop an action plan for vulnerability reduction, strengthen the share of population living in a municipality with a certified Municipal Civil Protection Committee (Comité Communal de Protection Civile, CCPC), and reduce the number of cumulative road closure days per year. 19. The has also demonstrated substantial compliance with key loan covenants, including audit and financial management reporting requirements. More than 70 percent of Grant funds are committed, and, as of May 21, 2017, disbursements had reached US$33.56 million (56 percent of the Grant). Disbursements are expected to increase in the next six months given that several large procurement lots are currently under tender. Overall, the is on track to meet its development objectives within the extended project lifespan. The has complied with World Bank environmental, social, and fiduciary safeguard requirements. There are no outstanding audit reports and all audit reports are satisfactory to the World Bank. 20. Component 1: Natural Hazard Risk Assessment and Analysis. Almost 100 percent of the US$3 million allocated to this component has been committed and about 83 percent has been disbursed. Achievements to date include: (a) collection and processing of high-resolution orthophoto, light detection and ranging data, and digital terrain and elevation models for the entire country; (b) dissemination activities of the first national Understanding Risk Forum and 5

14 Hackathon, as well as various ad hoc national and regional workshops on the availability and the potential use of the associated data; and (c) institutional analysis and the development of a capacity-building program aimed at strengthening the institutional capacity of targeted sectoral ministries in mainstreaming disaster risk into development planning Component 2: Support to Disaster Preparedness and Emergency Response. Seventy percent of the US$12.3 million allocated to this component has been committed and 50 percent has been disbursed. Achievements to date include (a) strengthening of all CCPCs, which is expected to be completed by June 2017; (b) completion of a national study for an emergency communication system and the establishment of pilot emergency radio communications hubs in four departments; (c) construction of the multifunctional DPC training center, which is expected to be completed by June 2017; (d) two national and regional simulation exercises for hurricanes and a national simulation exercise for managing emergencies during the carnival celebration; and (e) preparation of design and bidding documents for the construction of three pilot emergency shelters. 22. Component 3: Rehabilitation of Vulnerable and Damaged Critical Infrastructure. Sixty-seven percent of the US$31.3 million allocated to this component has been committed and 51 percent has been disbursed. It has supported critical structural investments in the transport sector and other investments to protect local access to the national backbone road network in the aftermath of the earthquake. These include (a) rehabilitation of 100 km of National Road 2 (RN2) and the Departmental Road 205 (RD205) connected secondary road, and the construction of the Dolin and Riviere Chalon bridges situated on RN2 and in Maniche; (b) rehabilitation/protection of more than 20 road segments in the southern departments and in Port-au-Prince, contributing to enhance resiliency of the network and year-round local access; and (c) facilitating immediate post- Matthew connectivity restoration activities, including the promotion of Labor Intensive Work (LIW), for example, cleaning, dredging, clearing, and making and installing gabion baskets. It has also supported continued recovery and reconstruction activities, including emergency response after Hurricanes Sandy and Isaac (2012) and more recently, Matthew (2016). 23. Component 3 has also supported the elaboration of technical guidelines, including a Guideline for Hydraulic Studies, a Regional Transport Framework for the Centre and Artibonite Departments, and various strategic documents, such as the Rural Access Investment plans for three departments that have been completed based on the RAI survey. 24. Component 4: Emergency Response and Recovery. The component was triggered on October 7, 2016 to provide assistance in immediate recovery activities, including (a) reestablishing access to the southern departments and critical connection point interventions, and undertaking rapid assessments to identify critical weaknesses in the road network, particularly those weaknesses that were exacerbated by Matthew; (b) construction of temporary bridge on river Ladigue (in Petite Goâve) to replace the collapsed bridge, allowing safe, all-weather access to the 12 Ministry of Interior and Regional Authorities (Ministère de l Intérieur et des Collectivités Territoriales, MICT), Ministry of Public Health and Population (Ministère de la Santé Publique et de la Population), MTPTC, Ministry of National Education and Vocational Training (Ministère de l Education Nationale et de la Formation Professionnelle), Ministry of Agriculture, Natural Resources and Rural Development (Ministère de l Agriculture, des Ressources Naturelles et du Développement Rural), Ministry of Planning and External Cooperation (Ministère de Planification et Coopération Externe), and Ministry of Economy and Finance (Ministère de l Economie et des Finances). 6

15 three departments of the south (1.4 million people); (c) deployment of technical experts to join the MTPTC s reconnaissance team; and (d) supporting initial connectivity restoration activities. G. Rationale for Additional Financing, Restructuring and Additional Benefits 25. The GoH officially requested an AF for the DRMRP to respond to the devastating effects of Hurricane Matthew 13. The proposed AF is the most suitable financing instrument to support the GoH in a timely manner and would be a more efficient response than the preparation of a new emergency project. It would benefit from scaling up an existing operation that is aligned with the emergency needs in the sector. The use of expedited procedures for processing the proposed AF would allow quick preparation and mobilization of resources necessary to help the MTPTC assess and rehabilitate the transport network. The consolidation of the proposed AF under the DRMRP would maximize potential synergies, particularly from fiduciary, safeguards, and technical support already provided under the parent project, promote efficiencies, and ensure better streamlined overall project management and reporting. 26. The proposed AF activities have been closely coordinated with other donors and the GoH, and would complement ongoing activities supported by the GoH and other donors, for example, United Nations Development Programme (UNDP) and the European Union (EU). In particular, the project is expected to facilitate the close collaboration with the Inter-American Development Bank (IDB) (which is also financing emergency road investments) so as to combine interventions to help restore access in the affected areas especially the south and the Grand Anse departments. The Rapid Assessment and the PDNA, which have been prepared by the GoH in collaboration with the World Bank, EU, United Nations agencies, and IDB, have supported and informed the design of the proposed AF. 27. The proposed AF would complement other ongoing World Bank emergency response operations, such as the proposed three other CRW-funded AFs to: (a) Relaunching Agriculture: Strengthening Agriculture Public Services II Additional Financing (P163081); (b) Sustainable Rural and Small Town Water Supply and Sanitation Additional Financing (P163194); and (c) Additional Financing for the Improving Maternal and Child Health Through Integrated Social Services (P163313). 28. Climate co-benefits for the proposed operation are expected to be very high as all activities will contribute directly to build resilience to climate and disaster risks. All activities are directly geared toward responding to a disaster triggered by a climate-related event and are aimed at building resilience to climate and disaster risks, which will directly contribute to enhance the country s capacities to adapt to climate change. In particular, the proposed activities will build back infrastructure damaged by a climate-related disaster to climate-resilient standards; this will enable the structures to withstand more frequent and intense climate events. Component 1 will contribute to increased knowledge and dissemination of information regarding climate risks, Component 2 will finance preparedness and climate and disaster risk awareness, and Component 3 will include the introduction of climate-resilient design and maintenance standards for roads and 13 November 7, 2016: Letter from Ministry of Economy and Finance to the World Bank 7

16 bridges. As a result, the totality of the proposed AF resources will contribute to enhance the country s capacities to adapt to climate change. 29. With persisting gender gaps existing even before Matthew, women are more vulnerable to the economic and social challenges caused by the hurricane and hence need to be proactively reached for access to opportunities. As in the parent, the proposed AF introduces specific actions and design parameters to ensure women s access to the social and economic benefits of the project such as: ensuring that women are proactively encouraged to participate in Labor Intensive Works (LIW) for emergency and recovery (targeting a minimum of 30 percent of LIW to be carried out by women, for an equivalent of 90,000 woman/days) and continuing to collect gender-disaggregated data on project beneficiaries and grievances. 30. The will include measures to encourage citizen engagement, including (a) a proactive communication strategy that will explain project benefits to local governments, beneficiaries, and the public from relevant communities and municipalities; (b) monthly consultations to monitor project impacts and seek feedback from project beneficiaries; and (c) a robust information request and grievance redress mechanism for project activities as a whole. Monitoring and reporting aspects of the existing grievance redress system will be strengthened under the AF. 31. Considering the nature of the works proposed under this AF, small works and very limited intervention area, the labor influx is expected to be negligible (from none to less than 10 people). Nevertheless, the proposed AF would continue to make a concerted effort to address potential risks by consulting the Guidance Note on Managing Risks of Adverse Impacts on Communities from Temporary Induced Labor Influx, dated December 1, The proposed AF, through its safeguard instruments, institutional arrangements, and contractual obligations, would incorporate a comprehensive array of measures to mitigate negative impacts of labor influx on local communities and vulnerable groups. H. Policy Waiver 32. In light of Haiti s high level of debt distress and situation of urgent need following Hurricane Matthew, this project document seeks the approval of Executive Directors to provide IDA resources from the CRW (US$20 million equivalent) for this proposed additional financing in the form of all grants, rather than on Haiti s current IDA terms. Haiti is a yellow light country, eligible for a mix of grants and credits in FY17 under its regular allocation and under any CRW allocation 14. However, the post-disaster Joint Debt Sustainability Analysis (DSA) for Haiti, circulated to Executive Directors on November 16, 2016, finds the country at high risk of debt distress following Hurricane Matthew. The provision of financing in the form of all grants for the proposed operation is appropriate, as the provision of credits would further heighten Haiti s risk of debt distress at a time of urgent need. On the basis of the November 2016 DSA, in FY18, Haiti will become eligible again for 100 percent grant financing from IDA. 14 Under the CRW s implementation framework for IDA17, the terms of assistance for CRW financing are identical to those under which regular IDA assistance is provided to a particular country. 8

17 III.Proposed Changes A. Proposed Changes Data Sheet Summary of Proposed Changes The proposed AF would scale up the s development impact by expanding the scope and financing of activities under each of the five components, with a special focus on Component 3. As a result, the description and results indicators under the existing legal agreements for the DRMRP will be amended; seven new indicators will be added to capture the results from the proposed scaled-up activities in the areas affected by Hurricane Matthew as well as a new citizen engagement indicator. Change in Implementing Agency Yes [ ] No [ X ] Change in 's Development Objectives Yes [ ] No [ X ] Change in Results Framework Yes [ X ] No [ ] Change in Safeguard Policies Triggered Yes [ ] No [ X ] Change of EA category Yes [ ] No [ X ] Other Changes to Safeguards Yes [ ] No [ X ] Change in Legal Covenants Yes [ ] No [ X ] Change in Loan Closing Date(s) Yes [ X ] No [ ] Cancellations Proposed Yes [ ] No [ X ] Change in Disbursement Arrangements Yes [ ] No [ X ] Reallocation between Disbursement Categories Yes [ ] No [ X ] Change in Disbursement Estimates Yes [ X ] No [ ] Change to Components and Cost Yes [ X ] No [ ] Change in Institutional Arrangements Yes [ ] No [ X ] Change in Financial Management Yes [ ] No [ X ] Change in Procurement Yes [ X ] No [ ] Change in Implementation Schedule Yes [ X ] No [ ] Other Change(s) Yes [ X] No [ ] s Development Objectives Original PDO Development Objective/Results The Development Objective is to support the Recipient in improving disaster response capacity and enhancing the resiliency of critical transport infrastructure. Change in Results Framework Explanation: 9

18 Additional indicators are proposed to be added under Components 1, 2, and 3 to capture the results of activities financed by the proposed AF in the departments specifically affected by Hurricane Matthew. All new and revised indicators and proposed changes are captured in Annex 1. An intermediary indicator on citizen engagement and beneficiary feedback has also been added. Compliance Covenants - Additional Financing of the Disaster Risk Management and Reconstruction - P163199) Source of Funds IDWT Finance Agreement Reference Schedule 2, Section I, A.1. Description of Covenant Date Due Recurrent Frequency Action CONTINUO US Institutional Arrangements - Ministère de l Intérieur et des Collectivités Territoriales (MICT): The Recipient, through MICT, shall ensure that the DPC (or any successor to said DPC) is maintained at all times during the implementation of the, with the responsibility for overall institutional coordination of the implementation. IDWT Description of Covenant Schedule 2, Section I, A.2.a. CONTINUO US Coordination, Implementation and Management: The Recipient shall maintain, at all times during the implementation of the : (i) the UCP-DPC within the MICT; and (ii) the UCE-MTPTC within the MTPTC, all with functions, responsibilities, staffing, terms of reference and resources satisfactory to the Association. IDWT Description of Covenant Schedule 2, Section I, A.2.b. CONTINUO US Coordination, Implementation and Management: Recipient shall ensure that: (i) the UCP-DPC shall be responsible for day-to-day administration of overall planning, coordination, technical, fiduciary (i.e, procurement and financial management), environmental and social safeguards compliance, coordination, monitoring, evaluation, reporting and communication of the activities under Parts 1, 2 and 5.1 of the ; (ii) UCE-MTPTC shall be responsible for day-to-day administration of overall planning, coordination, technical, fiduciary (i.e. procurement and financial management), environmental & social safeguards compliance, coordination, monitoring, evaluation, reporting & communication of the activities under Parts 3, 4 and 5.2 of the. IDWT Schedule 2, Section I, E.1 Description of Covenant CONTINUO US Environmental and Social Safeguards: The Recipient shall ensure to carry out the in conformity with appropriate administrative, technical, financial, economic, environmental and social standards and practices. The Recipient shall ensure that the is carried out in accordance with the Environmental and Social Management Framework (ESMF), the RPF, and any EMP or RAP once adopted and published. IDWT Schedule 2, Section I, E.2. New New New New New 10

19 Description of Covenant Environmental and Social Safeguards: The Recipient shall, in a manner satisfactory to the Association, take the following actions: (a) prior to commencement of any works under the : (i) prepare, in form and substance satisfactory to the Association, an EMP (based on the ESMF) and/or a RAP (based on the RPF) if required; (ii) thereafter, except as otherwise agreed with the Association, submit the said EMP and/or said RAP (as the case may be), to the Association for review and approval; (iii) subsequently, adopt and disclose, in a manner acceptable to the Association, said EMP and/or said RAP (as the case may be); and (iv) immediately thereafter, implement said EMP and/or RAP (as the case may be), all in accordance with their terms and in a manner acceptable to the Association; and (b) Except as the Association shall otherwise agree in writing, the Recipient shall not amend or waive, or permit to be amended or waived, any provision of any EMP or any RAP. IDWT Schedule 2, Section II, C. 28-Feb-2018 New Description of Covenant The Recipient shall, not later than six months after the Effective Date, appoint the independent auditors referred to in Section 4.09 (b) of the General Conditions, in accordance with the provisions of Section III of this Schedule. Conditions Source of Fund Name Type IDWT Section IV, 4.01 of Financing Effectiveness Agreement Description of Condition The Operational Manual (OM) has been issued and adopted by the recipient before effectiveness. IDWT Source of Fund Name Type Section IV, B.1.b: Emergency Disbursement Response Activities under Part 4 of Description of Condition No withdrawal shall be made for payments made unless the Recipient has furnished to the Association: (i) evidence satisfactory to the Association, that an Emergency has occurred, and a governmental action of the declaration of said Emergency; (ii) a list of Emergency Response Activities, including goods, works, consulting services, non-consulting services, Operating Costs and the Eligible Expenditures proposed to be financed under said Emergency Response Activities and included in a procurement plan acceptable to the Association; (iii) estimated cost of funding required to fully finance the Emergency Response Activities; and (iv) any assessment and/or plan the Association may require. Risk Risk Category Rating (H, S, M, L) 1. Political and Governance Substantial 2. Macroeconomic Substantial 3. Sector Strategies and Policies Substantial 4. Technical Design of or Program Moderate 11

20 5. Institutional Capacity for Implementation and Sustainability Substantial 6. Fiduciary Substantial 7. Environment and Social Substantial 8. Stakeholders Substantial OVERALL Finance Loan Closing Date - Additional Financing (Disaster Risk Management and Reconstruction Additional Financing - P163199) Source of Funds IDA Grant from CRW Substantial Proposed Additional Financing Loan Closing Date 30-Jun-2020 Loan Closing Date(s) - Parent (Disaster Risk Management and Reconstruction - P126346) Explanation: It is proposed to extend the closing date by three years (from June 30, 2017 to June 30, 2020) to allow for the completion of activities under the Grant that were deferred to allow for emergency recovery and reconstruction activities (specifically Bridge Estimé Dumarsais) and the additional infrastructure activities added under Component 3. Ln/Cr/TF IDA-H7460 TF Status Effective Closed Original Closing Date 31-Dec Jun Current Closing Date 30-Jun Dec Proposed Closing Date 30-Jun-2020 Change in Disbursement Estimates (including all sources of Financing) Explanation: Previous Closing Date(s) 30-Jun Jun-2014, 30- Dec-2015, 21- Oct-2016 The proposed disbursement estimates indicated in the table below refer to the disbursement projections of AF funds. Expected Disbursements (in US$, millions) (including all Sources of Financing) Fiscal Year Annual Cumulative Allocations - Additional Financing (Disaster Risk Management and Reconstruction Additional Financing - P163199) Source of Fund Currency Category of Expenditure Allocation Proposed Disbursement % (Type Total) Proposed 12

21 IDWT IDWT IDWT IDWT US$ US$ US$ US$ Goods, works, non-consulting services, consultants services, and training for Part 1 and 2 Goods, works, non-consulting services, consulting services, Training, resettlement compensation and assistance under Part 3 Goods, works, non-consulting services, consultants services, and Operating Costs for Emergency Response Activities under Part 4 Goods, non-consulting services, consultants services, Training, and Operating Costs for: (a) Part 5.1 of the ; and (b) Part 5.2 of the Total: IDAT US$ Change to Components and Cost Explanation: Total: Components Component 1: Natural Hazard Risk Assessment and Analysis (US$1 million). Component 1 would continue to support enhancing the Government s capacity to analyze and manage natural hazard and risk data by the CNIGS and continuing strengthening the technical and institutional capacity of the seven targeted sectoral line ministries by providing technical assistance to incorporate risks assessment and reduction elements into development planning. Component 2: Support to Disaster Preparedness and Emergency Response (US$1 million). The proposed AF would also involve few changes under Component 2. Subcomponent 2.1, Institutional Development of the DPC and Expansion of its CCPC Network, will add new activities financed by the AF, in particular supporting some risk awareness initiatives and a rapid assessment of the evacuation shelters in the affected areas affected by Hurricane Matthew. Subcomponent 2.2, Communication Network and Decision Support System, and Subcomponent 2.3, Pilot Emergency Shelter Rehabilitation and Construction will remain unchanged. Component 3: Rehabilitation of Vulnerable and Damaged Critical Transport Infrastructure (US$17 million). Under this component, additional resources would be used to finance emergency recovery and reconstruction activities, and to finance those activities that were postponed under the parent project so as to free up resources to respond to the emergency. Additionally, the proposed AF would finance the provision of support to the Bridge Management and Crisis Unit based at the MTPTC and local Departmental 13