Ghana - Agricultural Sector Investment Project

Document of The World Bank FOR OMCLIAL USE ONLY Report No. P-6128-GH MEMORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT IN THE AMOUNT EQUIVALENT TO SDR 15.3 MILLION TO THE REPUBLIC OF GHANA FOR AN AGRICULTURAL SECTOR INVESTMENT PROJECT NOVEMBER 10, 1993 MICROGRAPHICS Report No: P- 6128 GH Type: MOP 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 EDUIALENTS Currency Unit Cedi US$1.00 Cedi 630 Cedi 1.00 US$ 0.00159 WEIGHTS AND MEASURES I metric ton (m ton) 2,205 pounds (b) 1 hectare (ha) = 2,47 acres (ac) 1 kilometer (km) 0.62 miles (mi) 1 meter (m) = 3.28 feet (ft) LIST OF ABBREVIATIONS AND ACRONYMS AGSAC Agricultural Sector Adjustment Credit ERP Economic Recovery Program FY Financial or Fiscal Year GDP Gross Domestic Product IDA International Development Association MOFA Ministry of Food and Agriculture MTADS Medium-Term Agricultural Development Strategy NGO Non-Governmental Organization PCC Project Coordination Committee PCR Project Completion Report PPAR Project Performance Audit Review PPF Project Preparation Facility PPMED Policy Planning, Monitoring, and Evaluation Department PU Project Unit SAC Structural Adjustment Credit SDR Special Drawing Right SPAC Subproject Approval Committee FISCAL YEAR JANUARY I - DECEMBER 31 FOR OFFICIAL USE ONLY REPUBLIC OF GHANA AGRICULTURAL SECTOR INVESTMENT PROJECT CREDIT AND PROJECT SUMMARY 3orrower: The Republic of Ghana Beneficiaries: The Ministry of Food and Agriculture, District Authorities and Rural Community Organizations Credi, Amount: SDR 15.3 million (US$21.5 million equivalent) ITm : Standard, with 40 years maturity Financine Plan: Foreign Lgq T1t1 ................(US$ million)............. IDA 3.8 17.7 21.5 Local Government and Communities 0.0 3.6 3.6 Central Government U 0.3 IQ-AL II 3.8 21.6 25.4 1/ Includes duties and taxes of US$1.62 million. Economic Rate oeJrn: 23.3% Poverty Category: The project would have a 25 percent poverty alleviation component. Staff Appraisal Report: 12222-GH Mg: IBRD No 25215 This document has a restricted distribution and may be us, A by recipients only in the performance of their official duties. Its contents may not otherwise " sisclosed without World Bank authorization. MEMORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE REPUBLIC OF GHANA FOR AN AGRICULTURAL SECTOR INVESTMENT PROJECT 1. I submit for your approval the following report and recommendation on a proposed development credit to the Republic of Ghana for SDR 15.3 million, the equivalent of US$21.5 mill*on, on standard IDA terms with a maturity of 40 years to help finance an Agricultural Sector Investment Project. 2. Backgrund. Ghana is a mainly rural society, where traditional production methods are slow to change. Such resistance to change is the result of physical isolation, risk aversion and a history of government intervention which has effectively taxed away the potential for capital accumulation in the farming sector. The need for change in agriculture is implicit in the sectoral statistics. In the last two decades, the sector has grown at less than 2 percent per annum, and yet it still accounts for 50 percent of GDP and for 70 percent of employment. Without a significant jump in the agricultural growth rate, there is little or no prospect of achieving accelerated growth in the economy as a whole. The need to speed up the agricultural growth rate was the underlying theme of the Medium-Term Agricultural Development Strategy (MTADS), formulated by the Government with assistance from IDA in 1990. The MTADS examined the main constraints to sector growth and set out strategic objectives to address them. A target growth rate of 4 percent per annum was established as a benchmark. This target was considered the maximum achievable, given the resource base and the record of the past. A similar target was set out in the 1992 report, "Ghana: 2000 and Beyond", which examined the prospects for accelerated growth in the economy as a whole, with special emphasis on constraints in the productive sectors. In agriculture, the main constraints were identified as: (a) poorly organized government-run technical support services; (b) inappropriate production systems which over-exploit and degrade natural resources; (c) excessive government involvement in input supply, commodity processing and marketing; and (d) neglected rural infrastructure, constrained by over-centralized decision-making. The latter constraint is particularly severe. Only 3,300 km of Ghana's 21,300 km of feeder roads are usable in the wet season, an. farmers spend much of their time head-loading commodities from field to home and from village to market. In many cases, the relief of critical bottlenecks requires relatively small investments which can best be identified and implemented at local level. 3. IDA support for agriculture in recent years has been consistent with the priorities set out in the MTADS. These were: (a) setting clear objectives in research, extension, animal and plant disease control; (b) strengthening institutions to provide these services and to regulate natural resource use (forests, soils); (c) concentrating on low-level infrastructure investment (small-scale irrigation, feeder roads, rural markets) and decentralizing investment decisions to respond more rapidly to the needs of rural communities; (d) privatizing commodity buying, trading, processing, seed production, input supply and some technical (e.g., veterinary) services, all of which were still in Government hands by the late 1980s. All of these priorities, except for investment in rural infrastructure, have been supported by recent adjustment and investment operations. Since 1990, there have been five new IDA operations in agriculture, one Sector Adjustment Credit (AGSAC) concerned with the withdrawal of -2- the State from marketing and Input supply; three credits supporting agricultural services in the public sector (Research, Extension and Livestock); and one credit (Environment) supporting public institutions charged with regulating and managing natural resources. IDA is also financing a feeder roads project and preparing a rural water project and a local government support project. These operations are consistent with IDA's Country Assistance Strategy, which has emphasized deregulation and liberalization of the economy, support for the private sector and assistance for essential public sector activities such as providing infrastructure, social services and some technical services. 4. o Ject Oblcives. The main project objective is to increase the flow of technical and financial resources for rural development in response to needs expressed at the village and district levels. Related objectives are: to increase agricultural productivity and access to markets; and to strengthen the communities' capacity to develop, manage and maintain their investments using the resources of NGOs, local consultants, and public institutions. 5. Project Description. The project would finance the following investments for the benefit of rural communities: (a) constuction and rehabilitation of small-scale water schemes operated by farmer associations (11 percent of project costs); (b) construction and rehabilitation of rural markets for district authorities and communities which have a cost- sharing and maintenance agreement with traders and market users (44 percent); (c) roads to improve access to markets (17 percent); (d) storage and village food processing units for rural associations (2 percent). The project would also finance project-related local technical assistance, monitoring and training in irrigation, marketing and food processing management, as well as monitoring, evaluation, beneficiary assessment and impact studies (26 percent). Total project costs are estimated at US$25.4 million, of which the IDA credit would finance US$21.5 million (85 percent). Foreign exchange costs are estimated at US$3.8 million (15 percent). Estimated costs and financing plans, and procurement and disbursement tables are presented in Schedules A and B, respectively. 6. Eligible subproject costs would not exceed US$150,000. Subproject eligibility would be in accordance with technical, economic, social and environmental criteria. Eligible beneficiaries would be community associations and district authorities. Beneficiaries would contribute between 10 and 25 percent of the capital costs in cash or kind (e.g., labor) and would be responsible for all operation and maintenance costs. Full cost recovery would apply for equipment of income-generating subprojects. Beneficiaries would receive technical assistance from eligible technical support agencies, such as NGOs and consultants under technical assistance agreements with communities. These agencies would also carry out project-related training, extension and follow-up, depending on the need. The financing of the activities of the technical support agencies would be related to the investment costs and the nature of the investment. 7. Implemeutation. Beneficiaries would plan, implement and participate in the financing of subprojects, with the assistance of eligible technical support agencies. The Ministry of Food and Agriculture (MOFA) would be responsible for overall project management and inter-ministerial coordination, and implementation would be the responsibility of a Project Unit (PU) staffed with fixed-term employees experienced in project management. PU would establish regional offices in Accra, in the South, and Tamale, in the North. Regional Subproject Approval Committees (SPAC) would assist PU with the review of subproject applications. IDA would appoint a full-time supervisor at the Resident Mission -3- to ensure operational liaison with PU. Decentralization of procurement is an impo.tant feature of project design. Beneficiaries would manage the procurement process with assistance from technical support agencies and in accordance with rules established in an Implementation Manual and agreed with IDA. MOFA would recruit a procurement audit consultant and MOFA's Policy Planning, Monitoring and Evaluation Department (PPMED) would carry out beneficiary assessment and development impact monitoring. 8. The project would be implemented over five years. Project preparation started in August 1992 with the drafting of the Implementation Manual, information activities by farmer facilitators, and the establishment of PU offices financed under a PPF. After appraisal several pilot operations were launched. Full implementation would start after credit effectiveness with the organization of regional project launching workshops, the establishment of the second regional office and both SPACs, project information campaigns, and an accelerating investment program. 9. Project Sustainability. The project would aim to support economically and financially viable subprojects and assist in strengthening local government planning and management of infrastructure investments. Project-funded technical assistance provided by NGOs would be for local capacity building aimed at achieving full financial and managerial sustainability of subprojects. Associations and local authorities would only participate in the project if they are firmly established and properly managed, so that cost recovery, operation and maintenance are assured. Irrigation operating costs would be recovered through association membership fees, and farmers would contribute to land development and maintenance in cash and labor. This would increase the associations' credit-worthiness with local financial institutions which would be encouraged to provide subsequent seasonal and reinvestment capital. Market operating and maintenance costs would be fully recovered through market fees, local taxes and sales revenues. Full cost recovery through user fees would apply to income-generating agro-processing activities of rural associations. 10. Lessons Learned from Experience In Ghana. The 1991 and 1993 Country Implementation and Agricultural Portfolio Reviews indicated the following main difficulties in Ghana: (a) inadequate implementation capacity in the central government; (b) project complexity; (c) procurement delays; (d) inadequate and/or untimely release of counterpart funds; (e) inefficiency of foreign technical assistance; and (f) lack of aid coordination. Some of these problems were derived from over-centralized planning and execution, and a more decentralized approach may add greater flexibility. Other problems which have frequently been associated with over-centralization, especially in agriculture, have related to a lack of beneficiary involvement and excessive expenditures on centralized institutional development. In the light of this experience, the proposed project has been designed in the following way: project preparation has focussed on implementation capacity, the central feature being the Implementation Manual, which specifies eligibility criteria for subprojects and simple procurement and disbursement procedures to be used at village and district level. The object is to bring project management closer to the rural people and to build the capacity of local authorities and rural associations to manage the process. Initial operations have been launched on a pilot scale during the preparatory phase; the PU is being staffed with experienced local personnel and will not rely on expatriate expertise; and the project would involve NGOs to monitor implementation, employ consultants to verify subproject costs and quality, and organize yearly implementation reviews, including an extensive mid-term review. -4- 11. Rationale for IDA Involvement. There is an urgent need to increase the flow of resources for rural development and to change the process by which they are allocated. This is a particularly good time for IDA to take such an initiative, since the Government has embarked upon an administrative decentralization program aimed at delegating planning, budgetary and implementation responsibilities to local authorities. The 1988 "Local Government Law" established 110 District Assemblies and devolved the responsibilities of 22 central government departments. Ghana's policy objectives with respect to this decentralization are essentially three-fold: (a) to increase direct popular participation in development decision-making; (b) to increase the revenue base and efficiency of revenue collection at local levels in support of development activities; and (c) to improve managerial and administrative efficiency. IDA's Involvement would promote decentralization, develop a coherent strategy for farmer participation in investment and lead the way towards beneficiary- managed agricultural marketing and rural infrastructure improvement. This is consistent with the Country Assistance Strategy presented to the Board on June 10, 1993, which emphasizes growth with investment in human resources development, infrastructure, rural development and agricultural marketing. 12. Aged Actions. During negotiations, IDA and the Government have agreed on: (a) eligibility criteria for subprojects, beneficiaries and technical support agencies; (b) beneficiary contributions and cost recovery methods; (c) terms and conditions of financial assistance agreements; (d) the subproject processing cycle; (e) monitoring of project activities, project costs, PU performance and project imptct on beneficiaries and poverty; (f) maintenance of the PU, the Subproject Approval Committee and Project Coordinating Committee; (g) procurement, disbursement, and financial auditing and reporting requirements, in particular the provision of semi-annual reports; (h) recruitment of a procurement audit consultant by August 31, 1994; (i) establishment and maintenance of a project account; and (j) preparation and organization of a mid-term review. The deposit by Government of an amount equivalent to US$50,000 into a project account would be condition for effectiveness. 13. Environmental Aspects. The proposed project supports the goals of the Environmental Action Plan. Small-scale irrigation improves management of water resources while increasing agricultural intensification. Investment in agricultural marketing would have a positive impact on health and waste reduction. There are, however, some possible environmental problems for which mitigation measures have been designed. They include soil erosion during construction, water quality degradation through agricultural intensification, and water-borne diseases. The possible environmental impact of each proposed subproject would be evaluated and mitigation measures would be taken as follows: (a) consultants preparing subprojects would include an environmental evaluation in the project preparation studies; (b) the local health services would inform local communities of the health hazards involved in constructing water reservoirs and markets and, if necessary, carry out health hazard eradication campaigns; (c) technical support agencies would help the beneficiary communities to take preventive measures such as introducing biological defense mechanisms, perimeter fencing, farmer training in the use of chemicals, imposing strict limits on land excavation; and (d) the Environmental Protection Council would carry out regional studies and actions to increase community environmental awareness. To maintain a simple project structure, no subprojects would involve resettlement. Environmental Category: B. 14. Program Objective Categories. The proposed project would increase sustainable agricultural production through private sector development (15 percent), institution building -5- (20 percent), women in development (35 percent), environmental conservation (5 percent), and poverty alleviation (25 percent). The intended project beneficiariez live in rural areas which have a significantly larger proportion of poor people than the country's population as a whole. Poverty in Ghana is predominantly a rural phenomenon and 43 percent of rural inhabitants ive below the poverty line. 15. rject Benefits. The main project benefits would be: (a) improved links between production and markets leading to more efficient agricultural marketing and reduced post- harvest losses; (b) strengthened rural associations and local authorities; (c) increased irrigated land and agricultural production; and (d) more equitable regional income distribution. Most beneficiaries would be women: market traders, vegetable producers, transporters by head- load, and food processors. The project would also provide the framework for further donor and government assistance to irrigation, marketing and rural infrastructure. The project's financial and economic rates of return are estimated at 19.1 percent and 23.3 percent respectively. 16. Proectisks. The four main risks and mitigation measures are: (a) poor capacity of government and PU to cope with so many small subprojects-PU would have management autonomy, experienced private and public sector management staff, support from reliable NGOs and private consultants, and would be equipped with computer technology; (b) the subproject approval process may become overly complex through donor and government procedures-the projc implementation manual would have simple but detailed procedures, PU would hire influential farmers as part-time project facilitators, and IDA would appoint a project supervisor at the Resident Mission to ensure liaison with PU; (c) funds might be misused-adherence to eligibility criteria, strict and regular control by independent auditors, and public sanctions against misuse of funds, including loss of eligibility for further project support, would limit such risk; and (d) the lack of capacity to prepare subprojects-PU would establish and regularly update a list of capable consultants and sources of technical support to assist the communities. Sensitivity analysis on project costs and benefits shows switching values for project costs +36.2 percent and benefits -26.6 percent, for an opportunity cost of capital of 12 percert. 17. Recommendation. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and recommend that the Executive Directors approve it. Lewis T. Preston President Attachments Washington D.C. November 10, 1993 -6- Schedul A GHANA AGRICULTURAL SECTOR INVESTMENT PROJECT Estimated Costs and Financing Plan ESTIMATED COSTS Foreign Lod latal .....................US$ million................... I. INVESTMENT CATEGORY A. Civil Works 0.2 11.4 11.6 B. Goods/SuppliesfEquipment 1.7 2.7 4.4 C. Studies/Technical Assistance 0.5 3.2 3.7 D. Refinancing PPF 0. 8. Total Investment Costs 3.2 18.1 21.3 II. RECURRENT COSTS 0.1 0.3 0.4 III. TOTAL BASELINE COSTS 3.3 18.4 21.7 Physical Contingencies 0.3 1.8 2.1 Price Contingencies 1 1. 4, TOTAL PROJECT COSTS 1/ 3.8 21.6 25.4 I/ Includes duties and taxes of US$1.62 million. FINANCING PLAN ....................(US$ million)................. IDA 3.8 17.7 21.5 Local Government and Communities 0.0 3.6 3.6 Central Government & U % TOTAL 1/ 3.8 21.6 25.4 .1 Includes duties and taxes of US$1.62 million. -7- Schedula B1 Page 1 of 2 GHANA AGRICULTURAL SECTOR INVESTMENT PROJECT Procurement Methods and Disbursement A. ' 'ocurement Methods (in US$ million equivdent) Project Element Procurement Method LCB Local Other Total Shopping 1. Civil Works a) Water schemes 0.8 1.2 2.0 (0. 7) (1.1' (1.8) b) Rural markets 3.3 5.0 8.3 (2.5) (3.8; (6.3) c) Access roads 2.0 1.3 3.3 ( 1.9) ( 1. 11 03. 0) d) Storage/Processing 0.1 0.1 (0.1) (0.1) 2. Equipment/Supplies/Materials a) Rural Investments 0.3 4.7 5.0 (0.3) (3.8) (4.1) b) PU 0.3 0.3 (0.3) (0.3) 3. Consulting Services 4.4 4.4 (4. 1) (4. 1) 4. Operating Costs PU 0.4 0.4 (0.3) (0.3) 5. PPF 1.6 1.6 (1.51 (1.5) -- ----- ------- --- ----- - TOTAL 6.5 12.5 6.4 25.4 (5.5) (10.1) 15.9) (21.5) N=x: Figures in parentheses are the respective amounts financed by the Credit Schedule B Page 2 of 2 B. Summary Disbursement Schedule Catenory Amount Allocated IDA financed (%) (%) ('000 US$) oreign LOW Civil works 10,000 100 90 Equipment local communities 3,800 100 90 Consulting services 4,000 100 100 Project preparation facility 1,500 PU: (a) operating costs 300 85 until 31/12/96 and 75 thereafter (b) vehicles, goods and equipment 250 100 90 Unallocated 1,650 TQTAL 21,500 Estimated IDA Disbursements (in US$ million) IDA Fiscal Year 124 1..M 196 1997 199M 1999 Annual 2.3 2.3 3.5 5.5 5.5 2.4 Cumulative 2.3 4.6 8.1 13.6 19.1 21.5 -9- Schedule C Page 1 of 1 Timetable of Key Prolect Processinc Events Time taken to prepare: 18 months Project prepared by: Government of Ghana with IDA assistance 1/ First IDA mission: August 1992 Appraisal mission: May 1993 Negotiations: October 1993 Planned Date of Effectiveness: February 1994 Ust of relevant PPARs or PCRs: Volta Region Agricultural Development Project Report No 8765-GH Upper Region Agricultural Development Project Report No 6755-GH This project is based on the findings of an appiaisal mission that visited Ghana in May 1993, comprising P. Werbrouck (Mission Leader), R. Polson (Economist), C. Ranade (Sr. Agricultunl Economist), S. Dapanh (Economic Planner), K. Atta-Krah (Project Unit Director), T. Mensah-Bonsu (Civil Engineer). -10- 'TME STATUS OP BANK GROUPOPERAo niga NA ShUbD SAT=M.TO BANK N LGA AND DA0ra Pge lof3 (As of Se ptember 3A. J993> Am~tla um Mls Loo lesnaanU n) Qedit P a 10otoinand49~fdlt ulydh~te 18.2 mI2U Of whbi SAL. and ProgramLam s/ Cr.1393 83 Ghana Recon.lmporta 40M 0» P-0090 84 Gha~ E&part Rhab. 35.90 0f Cr. 1435 84 Ghana port Rebab. 40.10 00 Cr.1573 85 Ghana Reom.Impowt 40 00 A-0030 86 Ghana Recon.mpor 27ffi 0ff0 Cr. 1672 86 Ghana Inds riSeWtorAjm. 2850 0m A-0130 86 Ghana nds"ia1sectorAdjwL 250 00 Cr. 1744 87 jana Education SectorAdjua. 34.50 om Cr.177 87 'ihana SACI 340 00 Cr.1778 87 Ghana Str.AdjuL1nL Support 1080 0. A-025 87 Ghana SACI Ø10 00 A-0251 88 Ghana SACI 15.0 0U0 Cr.1911 88 Ghana Pina ` SetorAdMIL 100.0 00 C. 1911-1 89 ohana PinancalSectorAdjaL 60 0.0 Cr.2005 89 Ghana SACI 120f0 0. Cr.2005-1 90 Ghana SACU 5.70 0.00 Cr.2005-2 92 Ghana SACU 8.30 00 C.2236 91 Ghana Private Inatat 120.00 0.00 Cr.223-1 92 Ghana Private IAVCsmeatSupp 6.10 0.00 Cr.2236-2 93 Ghana Private low ~et Supp. 6.54 0.0 Sub-Toa 805.04 0.00 Cr. 1498 84 Ghana Second Oil Palm 250 3.3 Cr. 1801 87 Ghana Agricultu~5ws.Rehab. 17.00 ol Cr.1819 87 Ghana Petoleum ReLDit. 15&0 5D48 Cr. 1847 88 Ghana Public Enterpr TA 10.50 5.17 C.1854 88 Ghana Cocoa Rehabilitatio 40.00 35A Cr.1858 88 Ghana Tiaport Rehahella 1 60.0 18.0 Cr. 1921 88 Ghana MningSector~Rb 40.0 14.20 C. 1946 89 Ghana To~ uun i*l**U 190 5.90 C. 1976 • 89 Ghana Porst Res. Manageent 3940 20.26 C. 1996 89 Ghana Private SME De«. 360. 10.97 Cr.2039 89 Ghana Water Setor Rehab. 25.00 17.49 Cr.2040 89 Ghana Ruzalina • 20.0 8.97 Cr.2061 90 Ghana Faith Power(CG) 40.0 22.62 Cr.2109 90 Ghana VRA/Sxh Power 20.00 17.64 Cr. 2140 • 90 Ghana EducatloSectorAdLU 50.0 17.14 C.2157 90 Ghana Urban U 70.0 59.78 Cr.2180 91 Ghana Agric.Divrati"on 1650 16.31 C. 2192 91 Ghana Transport RehabilitadoU 96.00 7900 Cr.2193 91 Ghana Health A Populatloaf 270 23.00 Cr.2224 91 Ghana Econ. Management Support 1.00 108 Cr.2247 91 Ghana NationalGAri.P-uznh 22.00 2129 Cr. 2278 91 Ghana CommunitySecondarySchook 14.70 5.25 Cr.2318 • 92 Ghana PInancialSectorAdjuL. 1000 44.27 Cr.2319 92 Ghana NationalPe ~erRoada 55.0 54.72 Cr. 2345 • 92 Ghana Agr aIsctorAd. SoM 5032 Cr.2346 92 Ghana Nat.Agri.E en. 30.40 29.04 Cr.2349 92 Ghana Lit.Aunc.Sdl 17A0 14.01 Cr.2426 93 Ghana Environmental eoø~ MgL 18.10 17X Cr. 2425 93 Ghana Tertiary Education 45ff0 4025 Cr. 2441 93 Ghana National.ivtockServcs 22A45 2064 Cr. 2467 b/ 93 Ghana National Blectinao 80.00 78.03 Cr. 2498 bi 93 Ghana UrbanTranport 76.20 77.75 C.2502 b 93 Ghana Private Ent. Eport 41.00 41.84 C.2508 v 93 Ghana Priay school Deelop~nt 65.10 66.30 =11AL 189.72 2567.13 953.1 ofwhichaboeaim d 230 19.54 'OTAL aw hed bP Bank and IDA 5 2548.1 Aamountsold g_ ofwhicre~pald 0.38 'TOTAL ndISheU4 9553M al Approveddag or aer PM8L • SAJSECN- - 11 - GHANA Schedule D STATEMENT OF IFC INVESTMF~.S Page 2 of 3 (As of Septem ber 30. 1993) Original Gro= Commitments Fiscal Amount in USs million Year Borrower yp8 of Busins Ioan Equity Total 1984 Ashantfdo~lda Miing 55.0 55.0 v Corp. 1986 Keta B*ia50 0 - 4.5 4.5 Exploration 1988 Canadlan Bogosu Miing - 0.6 0.4 Rfsources 1989 Canadtan Bogos Mining - 0A4 A Resources Il 19Contental Merhant Bandag - 0.9 0.9 Ac ta Ltd. 1989 Wahome Steel Ltd. Steet Mg. 3.2 - .2 1989 Canadian Dogosu Mining 47.5 0. 48.0 1 Resources III 1990 AshantiGoldfietd Mining 70.0 -70.0 Corp. 11 1990 Iduapem Mining - 3.0 10 1991 Alugan (AP) Alumnum 0.3 - 0.3 1991 Plasti m aminate (ABF) Plasti 0.6 - 0.6 1991 Hotel Investments Tourim 4.2 - 4.2 (Ghana) Ltd. 1991 Dimples In (ABF) Tourism 0.2 - 0.2 1991 Canadian Bogosu Mining 0.8 0.4 12 Resources IV 1991 Contigental Merchant Banng 3.4 - 3.0 Acceptances n 1991 Ghanul Aluminium - 0.4 0.4 1991 Securiies Dscount Houe - 0.2 -0.2 Dikcount Hous 1991 Applah-Menksh(AE) SoapMfg. 0.9 - 0.9 1991 Iduapriem II Min~n 36.5 - 363 5 1991 Packuit (ABF) Cardboard Mig. 0.6 - 0.6 1992 Hotet Investments (swap) TouriUm 1.3 - 1.3 1992 Wahome teelU Stee Mfg. 2.0 - 2.0 1992 Askand Goldfiuds (swap) Mining 64 - 6.4 1992 Achimota BreweSy Beer Mg. 3.5 LO 40 1993 Polyte(ABP) Plasti vS 0.4 - 04 1993 BMK-Prm~wood (AEP) Pauticle Board 1.0 -- L 1993 Combined Fama (ABF) Agribusines 0.4 - 0.4 1993 AshantiGoldGeds(AMEP) Mining 165.0 - 165.061 1993 Ghana Le~asng CapalMarken 0.0 0. 0.8 Total Grosu Commitmant 402.g 12.7 415.5 Le repaymea, cancelatioma, and writc-offt 25L7 4.0 255.7 Not Commåtments etd by PC 1 .5 Total Udsbured 26.1.5 28. Iavestmeats approved bat nazgned as of September 1993 1992 Vi=s Farms (ABF) Agribusinues 0.3 - 0.3 1993 Pharmaplast Containes 0.2 - 0.2 1993 GHUMCO Manufactarng 0.5 - 0.5 1.0 0.0 1.O II Incfldea Ussl.s mEios pastiipatiau. 7/Auauntfilyuvrinenoir. whadaU ml5aopasticit. 5/n~ åkw~SS0.moapubain 51 oachn a .m miOuU aUo-- - 12 - Schedule D Page 3 of 3 GHANA - IMPLEMENTATION ISSUES Ghana's overall project implementation performance continues to compare favorably with other countries in the Region. An increased focus on Implementation, complemented with actions to address generic as well as project specific issues, resulted in disbursements increasing by over 30 percent in 1993 on investment lending. A Country Implementation and Strategy Review (CSIR) held in June 1993 addressed amongst others the issue of counterpart funds, lack of which is now beginning to have a serious impact on our projects. Because of financial Imbalances, caused from the large increase in wages made shortly before elections, the Government has cut back on capital investments. Key actions taken following the CSIR include setting up of a task fbrce to examine the mechanism needed for centrally administering pooled project accounts instead of maintaining separate project accounts, which has resulted in funds being tied up in some ministries even as other ministries lacked funds. The recommendations of the task force are to be Implemented by January 1, 1994. The other main focus at the CSIR was to examine ways to improve procurement processing. A simplification of procurement procedures was also agreed; the number of steps for review and approval have been reduced. To improve portfolio performance, the Resident Mission's supervision capacity has been strengthened, and its portfolio monitoring activities have increased. Intensive supervision and mid-term reviews are being used to redesign slow-moving projects. Total disbursements as of end September 1993 amount to $40.5 million. In the FY93 Annual Review of Portfolio Performance, the following five projects were rated as 3. Based on implementation of agreed action plans, most of these projects are expected to be upgraded soon. Cocoa Rehabilitation (FY88). To address the administrative problems that had led to slow implementation, project administration has been tightened, clear working relationships between implementing agencies have been established, and mechanisms have been put in place to monitor progress. IDA funds have been reallocated on the basis of the mid-term review. Problems causing delays in implementing the roads component have been resolved, following a revision of the entire roads component; all contracts have been awarded and construction has begun. Agreements have also been reached with the Government on the extension program and related studies under the project. FoEt Resources Manm (FY89). Project management and disbursement have improved considerably during FY92 and FY93. The Government has agreed on a policy action plan which, once it is implemented by end of November 1993, would trigger the release of the second tranche of the quick disbursing component (US$7.5 million). Water Sector Rehabilitation (FY90). An action plan has recently been agreed with the Government to address project management, water tariffs and the execution of the debt/capital restructuring agreement. After long delays, physical implementation of the project is now on track. Disbursements are expected to pick up as the rehabilitation process begins with good progress being made in the preparation of hydrological and planning studies. Detailed designs for 9 town water systems covered under the project have been completed. In addition Project Management consultants have prepared an operations management program to be implemented in two pilot regions. Agriculture Diversification (FY91). Project implementation has been affected by non-compliance with covenants on the signing of a subsidiary loan agreement by the implementing agency undertaking rubber outgrower operations. The project has also had a poor disbursement record. The mid-term review has been brought forward 18 months to November 1993. Restructurg will be necessary. Health and Population II (FY91). Work is beginning on an action plan that has recently been agreed with the Government. This will include the Governments assessment of the project and a joint mid-term review scheduled for January 1994 and April 1994, respectively. November 2, 1993 ，仰