Peru - Primary Health Project

Document of E The World Bank FOR OFFICIAL USE ONLY Report No. P-3400-PE REPORT AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT TO THE EXECUTIVE DIRECTORS ON A PROPOSED LOAN IN AN AMOUNT EQUIVALENT TO US$33.5 MILLION TO THE REPUBLIC OF PERU FOR A PRIMARY HEALTH PROJECT November 5, 1982 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS The exchange rate is being adjusted daily roughly in line with the differential between domestic and international inflation. The exchange rate and currency equivalents in 1981 and as of October 15, 1982 were as follows: Currency Unit = Sol (S/.) Calendar 1981 October 15, 1982 US$1 S/. 426.60 SI. 823.44 S/. 1 US$0.0023 US$0.0012 SI. 1,000 US$2.34 US$1.21 FISCAL YEAR January 1 to December 31 ABBREVIATIONS bpd - barrels per day ERP - Economic Recovery Program FAO - United Nations Food and Agriculture Organization IDB - Inter-American Development Bank IPSS - Instituto Peruano de Seguridad Social (Peruvian Social Security Institute) MOH - Ministry of Health PHCM - Primary Health Care Module PPF - Project Preparation Facility UNFPA - United Nations Fund for Population Activities USAID - United States Agency for International Development  REPUBLIC OF PERU FOR OFFICIAL USE ONLY PRIMARY HEALTH PROJECT LOAN AND PROJECT SUMMARY Borrower: Republic of Peru Amount: US$33.5 million equivalent, including a capitalized front-end fee. Terms: Repayable in 17 years, including four years of grace, at the standard variable interest rate. Project Description: The project's objective is to assist the Peruvian Ministry of Health (MOH) in improving health care services through the establishment of a primary health care system. The project would provide for training of staff as well as construction, furnishing and equipping of health facilities in four regions of Peru. The facilities would serve about 3.5 million people, most of whom live in absolute poverty and suffer from high rates of mortality and morbidity. The delivery system would also support efforts in the fields of population planning and nutrition improvement. The Bank loan would provide funds for maintenance facilities, project administration, project monitoring, health education and improving management in the MOH. Finally, the loan would include funds for the preparation of a further primary health care project. Project Risks: The project's main risk is that, because of insti- tutional weaknesses, the MOH will have difficulty in implementing the health delivery system -- which depends on successfully training 27,000 people and on improving a wide range of support activities in MOH. The project includes a number of measures to help deal with this risk, including technical assistance and training of personnel, some of which would be started prior to loan effectiveness with financing provided under a Bank project preparation facility (PPF). In addition, other development agencies including USAID, the German Government and the Pan American Health Organization are assisting in strengthening MOH. This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  - ii - Estimated Costs: (including about US$2.2 million equivalent in local taxes) Local Foreign Total -US$ millions------------- Infrastructure and Equipment 18.6 10.3 28.9 Health Staff Training 3.4 - 3.4 Community Health Education 2.7 0.1 2.8 Monitoring and Evaluation 0.3 0.3 0.6 Maintenance 0.6 0.3 0.9 Project Administration 2.5 1.1 3.6 Institutional Support for MOH - 0.5 0.5 Total Base Cost 28.1 12.6 40.7 Physical Contingencies 2.0 1.1 3.1 Price Contingencies 7.9 3.8 11.7 Total Project Cost 38.0 17.5 55.5 Front-End Fee on Bank Loan - 0.5 0.5 Total Financing Required 38.0 18.0 56.0 Financing Plan: Local Foreign Total ------------US$ millions------------ Bank 15.5 18.0 33.5 Government 22.5 - 22.5 38.0 18.0 56.0 Estimated Disbursements: Bank FY 1983 1984 1985 1986 1987 1988 1989 -------------