Document of The World Bank pX FOR OFFICIAL USE ONLY Report No. 3469b-ME UNITED MEXICAN STATES STAFF APPRAISAL REPORT ON A TECHNICAL TRAINING PROJECT June 30, 1981 Projects Department Latin America and Carribean Regional Office 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 (as of January 1981) Currency Unit = Peso (Mex$) US$ 1 = Mex$ 23.5 Mex$ 1 = USt 0.0425 Mex$ million = uS$ 42,500 MEASURES 1 square meter (m ) 10.76 sq. ft. 1 kilometer (km) = 0.62 miles GOVERNMENT OF MEXICO Fiscal Year January 1 to December 31 Academic Year September - June FOR OFFICIAL USE ONLY STAFF APPRAISAL REPORT UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT Table of Contents Page I. ECONOMIC DEVELOPMENT AND MANPOWER NEEDS ............. ... 1 II. MIDDLE-LEVEL TECHNICAL TRAINING ........................ 4 Overview of the Education System ................. 4 Middle-Level Technical Training ...................... 5 Major Issues in Middle-Level Technical Training ........ 7 III. THE CONALEP TECHNICAL TRAINING PROGRAM ................. 9 Introduction ................. .......... 9 Definition and Distinguishing Features ....... o.o ... 9 Objectives ......s.......... ............00 .... 10 Description ............ o_ .............. 10 Administration .................................. 10 Training Centers and Programs of Study ............... 11 Instructor Characteristics and Preparation ........ 11 Student Evaluation and Placement .. ...... ........ 12 Financing .......*...**...*.*.b.*....... ......... ...... 13 Assessment of Strengths and Weaknesses ......... oo ....... 13 Development Plans ....... ............ ..... -. .... ....... 14 IV. THE PROJECT .... ........ ...... ....... 16 Objectives ................................. ............. 16 Components and Description ........ 16 Instructional and Adminiistrative Support Complex 17 Technical Training Centers ........ o-o-oo .... 19 Further Development Plans oo ..... ............ o 21 Preparation of Future Projects .....o ..... -- ..... 22 V. PROJECT COST, FINANCING AND IMPLEMENTATION ..........o. . 22 Cost of the Project ................................... 22 Recurrent Cost Implications ........................... 26 Project Financing and Disbursement Plan ..... o ......... 27 Implementation, Procurement and Auditing .............. 28 Monitoring and Evaluation ............................. 30 VI. BENEFITS AND RISKS .......*. . . . . . . .................. .o................ 31 VII. AGREEMENTS REACHED AND RECOMMENDATIONS ................ 32 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. Table of Contents (Cont'd) Page Tables 1.1 Labor Force: Total Growth and Sectorial Distribution Patterns (1950-1980) .............. ......**.**......... e..o*........... 2 1.2 Manpower Demand by Economic Sector (1970-1990); Selected Skilled Workers and Technicians ........... 3 2.1 Middle-Level Education (1978/79) ...o .... 6 3.1 CONALEP: Enrollments (1980) by Major Training Field 11 3.2 CONALEP: Development Plan Parameters . ...... ........ 14 3.3 CONALEP: Instructor Requirements to 1985 ..0 ................ 15 4.1 Project Components, Enrollments and Outputs ... so. 17 4.2 Regional Distribution of Training Centers and Enrollments 19 4.3 Enrollments and Outputs (1985/86) by Program of Study ...... 20 5.1 Total Project Costs by Project Component 23 5.2 Total Project Costs by Category of Expenditure ......... Osseo. 24 5.3 Unit Cost Comparisons ........ .................... ............... 25 5.4 Expected Price Increases ..... o..oo..**..... 26 5.5 Schedule of Disbursements ....... ....... 27 5.6 Implementation Schedule o...........e ............. 29 Annexes Annex 1 - Comparative Education Indicators ....o............... 33-34 Annex 2 - Structure of Education and Training System .......... 35 Annex 3 - CONALEP Organization 36 Annex 4 - Criteria for Determining Location of Training Centers and Programs of Study ..37-38 Annex 5 - Disbursement Plan 39 Annex 6 - Contingency Allowances 40 Annex 7 - Implementation Schedule 41 Annex 8 - Related Documents and Data Available in the Project File ........... 42-43 MEXICO VOCATIONAL AND TECHNICAL TRAINING BASIC DATA (1980) 1/ Literacy Rate 92.4% Upper Secondary Education (1978-79) 2/ Total Enrollments as Percentage of Age Group 15-17 Male - 29% Female - 20% Total - 24% 3/ Vocational-Technical Enrollments as Percentage of Age Group 15-17 Male - 8% Female - 5% Total - 7% 3/ Central Government Expenditures on Education as a Percentage of Central Government Expenditures (1979)Total - 17% Total Expenditures on Education as a Percentage of GNP Central Government 3.8% Total Government 4.7% 4/ 1/ See Annex 1, Table 1.1 for comparative educational data. 2/ Source: SEP/Planning Office. 3/ Gross enrollment rates. 4/ 1980-GNP Estimate: 4.04 x 1012 Mexican Pesos. I w A I - ii~ - GLOSSARY CAPFCE: Administrative Committee of Federal Programs for School Construction (Comite Administrador de Programas Federales para la Construcion de Escuelas) CET: Center for Technological Studies (Centro de Estudios Tecnologicos) CONALEP: National Agency for Professional and Technical Education (Colegio Nacional de Educacion Profesional y Tecnica) ENAMACTA: National School for Teachers of Agricultural Subjects (Escuela Nacional de Maestros con Capacitacion para el Trabajo Agricola) ENAMACTI: National School for Teachers of Industrial Arts (Escuela Nacional de Maestros con Capacitacion para el Trabajo Industrial) SEP: Ministry of Education (Secretaria de Education Publica) I I I. ECONOMIC DEVELOPMENT AND MANPOWER NEEDS 1.01 Mexico has shortages of skilled and technical workers which are expected to become more acute as industrial development accelerates and which could seriously impair economic growth. Skilled manpower requirements are growing faster than overall employment requirements because of signifi- cant labor shifts from agriculture to industry and because of the productivity gains expected. While precise estimates of technical and skilled manpower requirements are not available, the order of magnitude of these estimates indicates that current requirements exceed the supply by ten-fold and the shortfall is steadily increasing. 1.02 Mexico has a successful, long-term record of economic growth. From 1940 to the early 1970s, the economy grew at an average of 6% in real terms, while inflation was kept below an annual rate of 5%. In the early 1970s, economic disorders such as high inflation, large public deficits, extensive unemployment coupled with shortages of skilled manpower, capital flight and balance-of-payments problems, slowed down the growth of GDP and brought the economy to virtual stagnation in 1975. Drastic economic measures in 1976 and 1977 quickly restored economic equilibrium. Subsequent oil discoveries have helped to restore confidence and economic growth. In the last three years, the economy has grown at more than 7% in real terms and employment at 4% or more. 1.03 The 1980-82 Global Development Plan sets as targets a 4.2% annual employment rate and 8% annual economic growth. These annual growth targets reflect the different emphasis placed on each sector: 4.1% for the farming and forestry sector, 10.8% for the industrial sector as a whole (with a 13.5% for the production of capital goods), and 6.7% for the service sector. Domestic investment, strongly supported by oil revenues, is growing rapidly. Public investment is growing at an annual rate of 14% in real terms, and will reach an estimated total of 1978-constant Mex$1,476 billion (i.e., US$65 billion) for the period 1977-82. The anticipated annual rates of expansion of public investment by sector, in real terms and according to the 1980-82 Global Development Plan, are 22% for the agricultural and rural development sector, 17% for the industrial sector (excluding oil industry, targetted to grow at an annual rate of 13.9%), 18% for transport and communications, and 21% for investments in social sectors. Private investment, mainly concentrated in the industrial sector, is also expected to increase at an annual rate of 13%. The Plan also introduced a long-term perspective. If short-term employment and productivity challenges can be met, the real per capita income could triple in the next 20 years. In addition, 20 million more people, double the current number, would enter the labor force, and industry would represent 45% of GDP. 1.04 The projected rates of economic growth would impose an accelerated demand for skilled workers and technicians that far exceeds expected outputs from the training system, thereby creating an acute shortage of skilled and technical workers. The magnitude and momentum of this demand far exceeds overall employment rates largely because of sectoral shifts. Table 1.1 records the sectoral patterns of the labor force from 1950 to 1980. While -2 - overall employment growth has been 4% per year over the last decade, employ- ment in the primary sector has slightly diminished, and the industrial and service sectors have expanded at the rate of 6.1 and 6.4%, respectively. These shifts are important because while in 1970 there were about 2% of skilled workers and technicians in agriculture, there were about 20% skilled workers and technicians in the industrial sector. Since employment in the industrial and service sectors is growing faster than the average, and the proportion of technicians and skilled workers is much higher, the demand of skilled manpower is growing faster than overall employment. Table 1.1 LABOR FORCE: TOTAL GROWTH AND SECTORIAL DISTRIBUTION PATTERNS (1950-1980) (millions and percentages) Total Labor Force Primary Sector Secondary Sector Tertiary Sector 1950 a/ 7.9 4.96 1.20 1.77 (100) (62.5%) (15.2%) (22.3%) 1960 a/ 11.4 6.33 1.96 3.06 (100) (55.7%) (17.3%) (27.0%) 1970 b/ 13.0 5.50 2.82 4.68 (100) (42.3%) (21.7%) (36.0%) 1980 c/ 19.4 5.41 5.17 8.82 (100) (28.0%) (26.8%) (45.7%) a/ From Census Data, reported by Munoz Izquierdo. b/ Average of calculations made by Munoz Izquierdo and M. Zymelman from Census Data. c/ Refinement and adjustment made to the 1979 Household Survey Data. 1.05 In addition, the demand of skilled workers and technicians is also determined by expected productivity gains, which require a higher concentra- tion of skills in the occupational profile of each particular industry or sector targetted for gains. Taking these factors into consideration (Table 1.2), the economy would require about 2.7 million of skilled workers and tech- nicians in 1985 and 3.6 million in 1990. Allowing for a 2% attrition rate in the labor force, the average annual requirements would be over 145,000 skilled workers and technicians to 1985, and an annual average of 176,000 from 1986 to 1990. These figures greatly surpass the output capacity of the regular technical training system. From 1975 to 1978, output has been estimated at less than 10,000 skilled workers and technicians per year (para 2.06). Thus, the magnitude of the shortage of skilled workers and technicians in Mexico is so great that it exceeds the actual supply by ten times and approaches 100,000 per annum. -3- Table 1.2 MANPOWER DEMAND BY ECONOMIC SECTOR (1970-1990) SELECTED SKILLED WORKERS AND TECHNICIANS Historical Data 1970 1980 Factor Factor No. of from a! No. of b/ from b/ Workers Census SW&T d/ Workers Survey SW&T d/ Tmio-nsT (per thousand) (thousands) (millions) (per thouand)((`housands) Primary Sector 5.50 15.5 85.3 5.41 15.8 85.3 Secondary Sector 2.82 219.4 618.7 5.17 223.9 1,157.6 Tertiary Sector _ 4.68 399.7 8.82 88.7 782.3 Total 13.00 - 1,103.6 19.30 - 2,025.1 8.49% 10.49% Projected Data c/ 1985 1990 No. of Labor Product No. of Labor Product Workers Factor Factor SW&T d/ Workers Factor Factor SW&T d/ (millions) e/ e/ (thousands) (millions) e/ e/ (thousands) Primary Sector 5.17 - - 85.3 4.88 - - 85.3 Secondary Sector 6.89 1.332 1.046 1,613.6 8.93 1.296 1.046 2,187.6 Tertiary Sector 11.44 1.218 1.035 1,05Q.8 14.09 1.232 1,035 1,340.1 Total 23.50 - - 2,749.6 27.90 - - 3,612.9 11.70% 12.95% a/ Number of selected skilled workers and technicians per thousand workers in the sector, extracted from M. Zymelman, Occupational Structures of Industries, Washington D.C.: WB, 1979. bl Data Refined from the 1979-Household Survey. ci Staff Estimates. d/ Selected Skilled Workers and Technicians. e/ Labor and Productivity Factors reflect the overall increases in labor and productivity. -4- 1.06 The projected shortage of skilled workers and technicians would have serious economic consequences if not alleviated. It would be difficult for industry to meet the planned 10% annual increase in production and even more difficult to remain competitive in international markets. Scarcity of technicians and skilled workers has already been identified as a major contri- buting factor to the current 30% inflation rate for 1980, which is about double the international rate. It is unrealistic to expect agriculture to grow even at the modest target rate of 4% per annum, without substantial upgrading of its labor force, given that farm employment has remained almost stationary and future growth would need to be based mainly on productivity increases. Solutions to the current transport bottlenecks or the maintenance of an efficient telecommunications network (targetted to grow at 9.5%) would be difficult without adequate numbers of skilled workers and technicians. Health and other basic services to people or industry cannot be provided, much less expanded, without this integral component of the labor force. From this perspective, reducing and eliminating the shortage of skilled workers and technicians seems vital to economic growth and development. II. MIDDLE-LEVEL TECHNICAL TRAINING 2.01 The Mexican general education system is well developed and reasonably financed, but there are major deficiencies in technical training at the middle level. Its output is numerically insufficient for the country's manpower needs and is defective in quality. Overview of the Education System 2.02 Mexico's system of general education is strong. It has good co- verage, relatively good efficiency and adequate numbers of students reach higher levels. There are 2.2 million students enrolled in all the levels of education, which are equivalent to more than 70% of 6-24 age bracket, an unusually high percentage for Latin America. Trained teachers and textbooks are plentiful. At the primary level (grades 1-6), the net enrollment rate reached 98% in 1980, up from 78% ten years ago. Internal efficiency 1/ has improved from less than 60% in 1971 to more than 75% in 1979. A free textbook program is well developed; more than 86 million books were distributed in 1979. Virtually all teachers are trained. At the lower secondary level (grades 7-9), first year enrollment represents 86% of all those who finished the primary level in 1980. Secondary enrollments tripled during 1970-80, growing at 11% per year. Its internal efficiency has remained high at about 85% for the same period. The upper secondary level (grades 10-12) is heterogeneous, including 22 different kinds of schools (Table 2.1). General upper secondary, which makes up two-thirds of the enrollments, has increased 400% in the last twelve years (growing at a rate of 15% per year). The teacher training institutions at this level are of good academic quality and efficient (i.e., as high as 1/ Internal efficiency is the ratio of the actual output, i.e., graduates, measured in student years, to the maximum possible output, i.e., gra- duates if there would not have been any wastage (due to repetition or dropout) of the number of student-years financed. -5- 90% internal efficiency). Higher education (grades 13-17) received 270,000 first-year students in 1980, or virtually all those who completed upper secondary education the previous term. Higher education includes several public and private universities of high quality such as the National Poly- technic Institute (IPN) and the Monterrey Institute of Technology and have grown at 12% per year. Enrollments in technical subjects represent 45%, a reasonable balance. In 1980, about 28,000 graduates received higher degrees in engineering, exact sciences and technological fields. 2.03 The Mexican Government also makes a reasonable effort to finance education. In 1978, the Federal Government spent Mex$85 billion on education and training, i.e., 17% of actual budget expenditures. This amount was about 4% of the GDP in 1978, representing a substantial increase over the 3.3% in 1973. State Governments and the private sector also spent significant amounts on education, bringing total education expenditures to about 5% of the GDP in 1978. 2.04 In contrast with these accomplishments, Mexico's system of technical and vocational education is inadequate, particularly at the middle level. For instance, despite a strong need for additional output in 1978, the number of applicants to terminal technical training from ninth-grade graduates dwindled from 10% to 7.5%, i.e., its lowest point in ten years. Moreover, student completion rates 1/ for middle-level technical education ranged from 34% to 12% in about two-thirds of the training centers. Middle-level technical education absorbed less than 2% of the education budget in 1978. In compara- tive terms, the output of technicians at the middle level is about one-third of the output of engineers and techr.icians at higher levels, whereas the ratio of selected skilled workers and technicians to engineers should be about 5 to 1. Middle-level Technical Training 2.05 The middle level is that segment of the education and training system which has grade nine as an entrance requirement and has a d'uration of two to three years (grades 10-12). The middle-level segment comprises four basic categories (Table 2.1): academic, teacher training, dual-purpose technical 2/ and terminal technical. 1/ Student completion rate, also known as terminal efficiency in Mexico, is the percentage of initial student entrants who eventually complete this three-year level. 2/ Dual-purpose technical programs has a mix of academic and terminal programs which are supposed to prepare students both for entering into the labor market and into higher education. - 6 - Table 2.1: MIDDLE-LEVEL EDUCATION (1978/79) No. of Graduates No. of No. of Total 1979 Entering Labor Category Streams Schools Enrollments Graduates Force (units) (units) (000's) (000's) (000's) Academic & General Technical (pre-university) 5 1,475 797.6 176.3 - c/ Teacher Training 5 349 177.2 31.2 14.1 d/ Dual-Purpose Technical a/ 8 285 210.9 23.2 4.6 Terminal Technical b/ 4 41 20.1 5.0 5.0 Total 22 2,150 1,205.8 234.7 22.7 Source: Jose Luis Lopez Portillo, Cuarto Informe de Gobierno, Anexo Estadistico and SEP, Estadistica Basica de Educacion Tecnologica, 1979-1980. a/ In addition to the Centers for Scientific and Technological Studies, Centers for Studies in Agricultural/Livestock Technology, Centers for Studies in Forestry an Centers for Scientific and Technological Studies in Maritime Sciences, statistics include streams in-the National Poly- technic Institute, Regional Technological Institutes and the Regional Center for Technical Industrial Education. b/ Centers for Technological Studies, the National School for Teachers of Agricultural Subjects, the National School for Teachers of Industrial Arts and the terminal Centers for Studies in Agricultural/Livestock Technology. c/ First-grade university enrollments exceeded the number of regular graduates because graduates from tele-secondary and normal schools also had access to higher education. d/ Estimated; entrance in next-level teacher training institutions in 1979 was 13.1; it is also assumed that another 4.0 continued higher education. 2.06 The 22 different kinds of schools in the 4 basic categories of this level seem to offer a wide variety of choices. The choice is more apparent than real, since there is no diversification effect. The final purpose of the academic category is to gain access to higher education. Moreover, 90% of the graduates of the dual-purpose technical category also gained access to higher education in 1978 according to official estimates. In total, over 210,000 - 7 - graduates continued to higher education and only about of 23,000 graduates joined the labor force (Table 2.1). If teachers are excluded, the number of graduates with technical and vocational training joining the labor force was only 9,600. 2.07 Until 1978, the middle-level, exclusively terminal, technical pro- gram was represented basically by the Centros de Estudios Tecnologicos (CETs). The CET program was created in 1968 and, up to 1978, it had only 17 schools, the majority (12) concentrated in Mexico City. Its 5,000 graduates were the most important contribution to the supply of skilled workers and technicians. There were also two minor programs to prepare technical instructors with one single school each (ENAMACTI and ENAMACTA). Major Issues in Middle-Level Technical Training 2.08 Substantial changes are needed to address the. following major issues in the system of middle-level technical training: (a) Insufficient Output. Excluding teachers, the effective number of graduates joining the labor force in 1978 was 9,600; the estimated demand for skilled workers and lower-level technicians that year was about 130,000. 1/ Thus, the output of middle-level technical training was less than 10% of the estimated demand. Four factors contributed to this shortfall: (i) insufficient number of applicants to terminal and dual- purpose tecniical training. !Li 1978, for instance, out of more than 500,000 ninth-grade graduates only about 39,000 applied for entry into these types of training. Moreover, trends up to 1978 showed a steady decrease in this proportion because most of the students sought admissions to academic streams and higher levels; (ii) low completion rates in terminal training. According to a 1978 survey by the Ministry de Education, an average of only 25% of the students out of every 100 entrants eventually graduated in the two-thirds of the centers surveyed. This is because many students used terminal education as a waiting bay for transfer to academic or dual-purpose programs; (iii) low proportion of graduates joining the labor force. It is estimated that nearly 90% of the graduates of dual-purpose training programs decided to proceed with higher studies rather than join the labor force; and (iv) insufficient training opportunities in several regions and states, resulting in regional imbalances. For instance, the proportion of vocational and technical training places in the 1/ The gap of middle-level skilled manpower was filled with (a) highly trained technicians, who were over-qualified; and (b) insufficiently trained technicians, who received only informal training. -8 - Central Northern and Central Western regions (14 million people) is about half of the national average, while the Federal District (9.4 million people) has proportionally five times as many training places as those regions. Highly industrialized areas, such as Monterrey, also lack middle- level vocational training opportunities: for instance, the State of Nuevo Leon, where Monterrey is located, has only about 0.53 of the national average. (b) Poor quality. The quality of middle-level technical training tends to be poor because it is lacking in practical content. Theory is generally well taught but there is insufficient emphasis on practical applications and know-how (in 1978, only 10% of the weekly schedule). Poor quality in training results from: (i) academically qualified teachers, who lack experience in business and industry, and are prone to lecture rather than follow a practical approach to training; (ii) frequently inadequate supply of materials for effective develop- ment of practical skills. While equipment is generally not lacking, it is inappropriate particularly in the dual-purpose schools. This is because it has been selected without appro- priate consultation with industry or equipment specialists, and the academic bias is paramount; (iii) an irrelevant curriculum that has been developed without appro- priate consultation with the productive sectors. There are too many training specialties (more than 80 in two particular programs) which do not match skill profiles in industry. Training content is not standardized among the different types of schools; and (iv) absence of student evaluation, placement services and follow-up. (c) Unresponsiveness to development needs. The management of changes in middle-level technical education has proved to be difficult. This is because of the unwieldy fragmentation of programs (up to 12) and authority (4 General Directors and 27 regional authorities). A Coordinating Council was created in January 1979 to improve manage- ment, but has little effect because of (a) lack of timely and appropriate information and (b) administrative complexities of the problem. For instance, the Teachers' Union has had the right to appoint up to 50% of all teacher and school administrator vacancies regardless of minimum qualifications. -9 - III. THE CONALEP TECHNICAL TRAINING PROGRAM Introduction 3.01 By the late 1970s, it was evident that the middle-level technical training system was inadequate to deliver the quantity and quality of skilled workers and technicians required by the rapidly changing economy. Moreover, the prospects were poor for sufficient expansion and upgrading through the traditional system. Therefore in 1978 the Government thoroughly studied existing programs of training and concluded that it would be desirable to create a new, independent program to provide terminal training for substantial numbers of skilled workers and lower-level technicians. As a result of the study, the President of the Republic issued a decree in December 1978 creating a decentralized, semi-autonomous public agency named the Colegio Nacional de Educacion Profesional y Tecnica (CONALEP). 1/ Definition and Distinguishing Features 3.02 The CONALEP program is designed to train skilled workers and lower- level technicians through terminal programs at the upper secondary level (grades 10-12) or equivalent, in close cooperation with the productive sector and in a variety of agricultural, industrial and service training programs. It differs from other middle-level technical training programs on the follow- ing counts: (a) It is semi-autonomous; this facilitates its responsiveness to changing needs and participation of the productive sector, e.g. it can receive donations from industry; (b) its administration is decentralized so that operational decisions, including curriculum adaptations, are delegated to local training authorities and their advisory boards; (c) its curriculum has a practical orientation and strong emphasis upon evaluation, follow-up and feedback; (d) its training programs are strictly terminal and job-market oriented; (e) its unique student recruitment approach enhances the program's public image and encourages the active support of the productive sector; (f) students pay a tuition proportional to their training costs; and (g) its instructors are from industry, work only part-time and cannot belong to the Teachers' Union because CONALEP is not their main employer. 1/ In 1980, the Government took another important step by making it mandatory for employers to provide on-the-job training, either directly or through general training programs registered with the Ministry of Labor and Social Welfare. CONALEP has met that registration requirement. - 10 - Objectives 3.03 The program objectives are: (a) to expand the output of middle-level technical training by creating, in close cooperation with the productive sectors and in the quantities required by the economy, a large network of terminal training centers; (b) to improve the quality of middle-level technical training by emphasizing a practical curriculum, relevant to changing regional and sectoral needs; and (c) to increase the efficiency of middle-level training by enhancing its public image, achieving higher retention rates and decentralizing training opportunities. Program Description 3.04 Administration. The CONALEP training program has three levels of administration -central, regional and local. At the central level, the Board of Governors determines policy. This Board comprises seven members from business and industrial leaders who are appointed by the Minister of Education to serve staggered terms. The President of the Republic appoints the Director General of CONALEP, who also chairs the Board. A committee consisting of other business and industrial leaders from the various regions advises the Board. The Director General who is also the chief administrative officer of CONALEP, can serve a maximum of two four-year terms and is assisted by the seven directors of planning, operations and teacher training, buildings and equipment, evalua- tion and certification, administration and finance, legal affairs, and publ:ic relations (Annex 3). Each directorate, with some exception for the planning directorate, is well-staffed with qualified and experienced staff and support personnel. 3.05 At the regional level, six regional coordinators who report directly to the Director General, coordinate local training programs. These coordina- tors are responsible for promoting and coordinating school-industry relations, the continuous relevance of local training programs to manpower needs and the identification of additional training needs for future development. 3.06 At the local level, the director of each training center is the chief administrative officer. A committee comprised of local and regional business, industry personnel and representatives of instructional staff and students, advises the director on training matters. The center director is assisted by coordinators of training programs and administrative services. 3.07 The CONALEP program is being advocated through radio, television, national and local newspapers, and high-quality brochures. This promotion campaign is successfully directed towards business, industry, parents, poten- tial students, and the general public. It emphasizes the important role of skilled workers and technicians in economic and social development, describes the CONALEP training program (including details of available courses of - 11 - study), the employment opportunities and the job placement system. Eighty percent of CONALEP students are enrolled in the program because of this multimedia campaign. The large amount of assistance CONALEP receives from business and industry also indicates the success of this innovative idea for improving the public image of technical training. 3.08 Training Centers and Programs of Study. CONALEP's training programs are carried out in centers dispersed throughout the country. By January 1981, 10 training centers had been completed and 52 additional centers, ranging in size from 400-2,000 students in two shifts, were in various stages of completion and partially operational in temporary facilities. The enroll- ments, programs of study and location of centers are determined on the basis of national, regional and local development plans. Current enrollments of full and part-time students, in both day and evening shifts totals about 19,000 in the following broad fields of training: Table 3.1: ENROLLMENTS BY MAJOR TRAINING FIELD Enrollment Field of Training October 1980 Agriculture and Food Processing 770 Industry and Construction 13,500 Textiles 360 Business and Commerce 3,900 Health 390 Total Enrollments 19,000 3.09 Enrollment is open to qualified students who have completed grade nine. The evening shift is also open to employed youth and adults who are considered to have an equivalent level of education. Because of the severe lack of equipment, programs of instruction currently consist, in many in- stances, of theory classes taught in the training centers and practical activities conducted in nearby business and industrial facilities. This is an unsatisfactory situation but one which is justifiable for the moment. 3.10 Experienced subject-matter specialists, assisted by specialists from business and industry, develop all curricula and course syllabi. Thus far, 19 specific training programs have been developed in five broad fields with supporting curricula and course materials, under the supervision of the central directorate of operations and teacher training. Instructors and the advisory members from local industry adapt the basic course syllabi to regional requirements. The resulting curricula and course syllabi are well- balanced, with an average distribution of 15% for general theory, 35% for technical theory and 50% for technical practice. 3.11 Instructor Characteristics and Preparation. Experienced and fully qualified teachers teach all general subjects. Technicians and practical engineers, having at least five years of experience, are recruited on a - 12 - part-time basis (10 hours/week) to teach the technical theory and work-shop classes. They receive a higher hourly wage than those from institutions under the Ministry of Education. Local industry has expressed its cooperation in making such staff available as appropriately equipped training centers become available. Preparation of these instructors is being carried out by CONALEP through its own teacher training unit. Eight fultime, qualified and experienced professional teacher trainers comprise the training unit, which is assisted by qualified part-time trainers, on a contract basis. 3.12 The instructor training program consists of both regularly sche- duled pre-service courses and ad-hoc in-service courses. Additionally, in special instances, programmed courses are offered by correspondence. The pre-service courses consist of 56 hours of pedagogical preparation, including 14 hours of practice teaching, and are conducted in either CONALEP's rented (and poorly equipped) facilities in Mexico City or, at the regional level, in temporary facilities in local training centers. The minimum in-service training consists of 64 hours of human relations, instructional methodology, modular curriculum preparation and shopwork organization and management. Additional in-service course work of up to 130 hours is provided for the upgrading of specialized technical skills. The curriculum and course syllabi for the instructor training courses are well developed according to modern pedagogical practice. 3.13 About 1,500 instructors (about 1,000 for industry and 500 for business training) were employed during 1980-81 in the 62 training centers partially operational at that time. About 2,000 instructors are currently enrolled in pre-service courses and another 1,450 in in-service courses. 3.14 Student Evaluation and Placement. Student evaluation, follow-up and feedback are joint functions of the local training centers and the na- tional Directorate of Evaluation and Certification. This directorate has a well-qualified staff consisting of 10 professionals and adequate numbers of support personnel. It is currently developing and distributing instruments to evaluate instructor and student performance. Evaluation of instructors includes formal self-evaluation, as well as evaluation by both students and supervisors. As the existing centers have not yet graduated students, current emphasis is on evaluation of instructor and student performance and in tracking job placement of dropouts. However, follow-up instruments for assessing job performance are being prepared for utilization with the first group of students graduating in 1983. The Director is also assisting the local centers in the proper use and evaluation of these instruments and in the feed-back of relevant information into the curricula and the teaching-learning process. Each training center, with the assistance of its local advisory committee and the regional training coordinator, has the responsibility of assessing the relevance of training as measured by the job performance of its graduates. This information will be returned to the local instructors and to the subject matter specialists at the national level for use in improving curricula and course syllabi. 3.15 In terms of qualitative abilities, graduates are expected to be able to perform, after a short period of on-the-job orientation and training, as medium-level skilled workers or as lower level technicians. Many of them - 13 - should be able to advance to the level of highly-skilled workers and medium- level technicians after 3-5 years on the job. Job placement of all graduates is the responsibility of the local center administration, with the assistance of the local advisory committee and the regional training coordinator. Financing 3.16 The allocation of the Federal Government to the CONALEP program for 1981 is Mex$1,171 million (US$50 million), or about 0.7% of the recurrent budget for the Ministry of Education. The anticipated official allocation for 1982 is Mex$1,854 million (US$79 million). In addition to federal funds, CONALEP is empowered to receive funds from the productive sector. CONALEP has made use of this capability and continues making contractual agreements with state governments and various industries. Total contributions and contracts from December 1979 to January 1981 amounted to an equivalent of Mex$1,500 million (US$64 million). Most of these contributions are in kind: i.e., in the form of construction sites, rent-free buildings and specialized equipment donations. Finally, CONALEP's students also pay tuition and commit themselves to a deferred payment upon graduation and employment. The tuition, which is equivalent to one-tenth of the average training costs, is being paid in ten monthly installments of about US$10 per month and the deferred commit- ment, which carries no interest and has a five-year term, has a present value of about US$725. In some cases, employees would pay this deferred tuition. 3.17 CONALEP's unit recurrent costs are reasonable. Recurrent costs in 1980 were Mex$23,900 (about US$1,000) per student-year; which is about Mex$15,000 at 1978 constant prices. While technical training unit costs vary widely in Mexico, the unweighted average for the upper middle level in 1978 was Mex$15,340 pesos per student-year, and the unit costs for basic training were even higher: Mex$25,000 in 1978. Assessment of Strengths and Weaknesses 3.18 Strengths. Despite its relatively short existence, the CONALEP technical training program has been established on a sound basis, appropriately addresses the issues of the sub-sector, is well designed and is being rapidly implemented. Among its more important strengths are those of: (a) a well organized and staffed administration, with a clear and appropriate division of authority and responsiblity between the national, regional and local administrative levels; (b) the practical orientation of its curriculum which is terminal in nature and kept relevant to local, regional and national needs through inputs from industrial advisory groups at the national and local level; (c) the use of industrially experienced and pedagogically qualifed instructors; and (d) a highly successful promotional program resulting in contributions from industry and state governments and the attraction of 80% of the students in the first year program. - 14 - 3.19 Weakness. The CONALEP program has a number of deficiences which must be addressed. Its expansion program is proceeding at a rapid pace but it is currently out-of-phase with other aspects of a successful program. Among its more critical needs are those of: (a) the physical consolidation of its national administration in a central location to alleviate the constraints on communications, coordination and administrative efficiency caused by the direc- torates being currently housed in inadequate accommodations in five separate areas of the city; (b) adequately equipping the 62 training centers which are either completed or under development; (c) improving the retention rates of its first-year students over the 35% dropout experienced during the first year of the program's operation (1979-80). A major contributing factor to this high desertion rate is the currently strong industrial demand for employees with even minimal levels of skill training. It is also due to the lack of sufficient and appropriate equipment, the temporary nature of its workshops, the lack of sufficient industrial instructors in some programs, the financial needs of students and, perhaps, an unrefined student selection process; (d) improving the recruitment and preparation of instructors, parti- cularly for morning-shift classes which were problematic in the first year of operation; (e) improving the long-term planning capabilities of its planning directorate and completing the 1983-88 plan for program expansion,; and (f) introducing flexible length of courses so as to respond quickly to changes in labor market demands. Development Plans 3.20 CONALEP's development plans are in a formative stage, but they indicate two phases: 1979-83 and 1984-88. The broad dimensions of these phases are as follows: Table 3.2: CONALEP: DEVELOPMENT PLAN PARAMETERS a/ Phase I Phase II 1979/83 1984/88 Training Centers 100 350 Enrollments 70,000 200,000 Instructors 5,300 15,200 Investment (US$ million) 220 400 a/ All Phase II data are cummulative, except investment estimates. - 15 - 3.21 The first phase program is well defined. Planning has not yet started on the second phase. CONALEP intends to upgrade the capabilities of its Directorate of Planning in the areas of manpower needs assessment, strategic policy analysis and cost analysis. 3.22 The top priority of Phase I is to establish a firm administrative base for the effective management of the system. Strong staffing and orga- nizational design have already been achieved (para. 3.17), but CONALEP's Directorates are physically dispersed. Therefore, during Phase I a central administrative and support complex will be established. The complex will also include instructor training facilities, teaching materials development and production, information and documentation system, and an auditorium. The establishment of this complex will enable CONALEP to improve its administra- tive efficiency, including better communications and coordination, expand and improve teacher training activities and better support its production of teaching materials. 3.23 Another immediate priority in the first phase is to equip the ten training centers which are completed and the 52 currently under construction. Additionally, plans call for expansion through the construction, furnishing, and equipping of 36 new training centers and the equipping of a special training center having combined enrollments of about 24,900 regular and 1,000 special students. This would increase total enrollment capacities in 99 training centers to about 70,000 by 1985-86. These training centers would be located throughout the country in accordance with skilled manpower demand. 3.24 The large instructor requirements (Table 3.3) of the expanded training system call for the expansion and improvement of the instructor recruitment and training system. Table 3.3: CONALEP: INSTRUCTOR REQUIREMENTS to 1985 Requirements - To Be Currently Trained Total Fields of Training Employed (1981-1985) by 1985 Agriculture and Food Processing - 270 270 Industrial 980 2,540 3,520 Textiles - 120 120 Business and Commerce 470 660 1,130 Health - 510 510 Total 1,450 4,100 5,550 a/ Estimated from enrolments in Table 4.3, para. 4.11. The staffing of the 62 training centers currently under development and the 37 new centers planned for 1983 (to be fully operational in 1985) requires about 4,100 additional instructors, who need to be trained during the 1981-85 period. Instructor attrition will require that about 800 new instructors be - 16 - trained annually after the 99 first-phase training centers are fully opera- tional. Plans call for the inclusion of accommodations and equipment for a instructor training center within the central headquarters complex and improved equipment for the regional ad-hoc instructor training program. 3.25 The above plans are expected to require capital outlays of about US$220 million over the first phase (1979-83). Approximately US$27 million, or 12%, has already been expended. The second phase is expected to require capital outlays in the order of about US$400 million. Its size and shape is contingent upon further refinement of manpower estimates. IV. THE PROJECT Objectives 4.01 The proposed project would help CONALEP to improve and complete its first-phase training plan through 1983. The specific project objectives are: (a) to strengthen the efficiency and effectiveness of the central administration by providing facilities for teacher training, development of instructional materials, supervision of operations, information and documentation, and central administrative support services; (b) to increase the output of skilled workers and technicians by expanding existing capacity by an additional 50,000 students and by providing appropriate equipment for a total of about 70,000 students; (c) to improve the quality of instruction by upgrading and expanding instructor training, emphasizing the practical approach,, evaluation, follow-up and feedback; and (d) to improve the quality of its 1983-88 long-term plan by including reliable manpower estimates, cost-reduction measures, and strategic training alternatives. Components and Description 4.02 The proposed project, in supporting the entire first phase of CONALEP-s development program, would consist of the following components and institutions, which are to be fully operational by December 1983: - 17 - Table 4.1: PROJECT COMPONENTS, ENROLLMENTS AND OUTPUTS Grade Annual Project Components Level Enrollments Output Construction, Furniture and Equipment: Instructional and Administrative Support Complex NA NA NA 37 Technical Training Centers 10-12 25,900 8,100 Partial Construction and/or Remodelling, Furniture and Equipment: 52 Technical Training Centers 10-12 29,400 8,500 Equipment Only: 10 Technical Training Centers 10-12 14,200 4,300 Project Preparation for Second Project - - Instructional and Administrative Support Complex 4.03 The eight administrative and supervisory directorates of CONALEP are currently located in rented and inadequate facilities in five widely dispersed locations in Mexico City (para. 3.18). Bringing all of the direc- torates together with the general directorate in a central location, would improve communications, coordination and administrative efficiency. The complex would consist of centers for instructor training, instructional materials production, information and documentation, and administrative services. The project would finance the construction and equipping of this complex comprising about 10,900 square meters of space. The government would finance the furniture needs. 4.04 The additional space available would permit an expansion and further development of the instructional and administrative services as detailed in the following paragraphs. During negotiations CONALEP has provided assurances that, at Bank's request, the annual work programs for the instructor training center, the instructional materials production center, and the information and documentation center would be sent to the Bank for review and comment. - 18 - 4.05 Instructor Training Center. The proposed instructor training center would enable CONALEP to prepare the 4,100 additional instructors needed before 1985. It would occupy about 1,500 square meters. It would include a small reference library, offices, classrooms, projection rooms, a model industrial shop and a model business office, and service facilities. Because of the critical importance of the demonstration technique in skills training programs, these model shop and office facilities would enhance the instructor training program. The current instructor training staff (para. 3.11 to 3.13) is ade- quate in quantity and quality for the operation of the proposed expanded program. It includes part-time professional staff available on an ad-hoc basis from other teacher training institutions. 4.06 Instructional Materials Production Center. The instructional materials production program, currently operating in inadequate rented faci- lities, requires expanded facilities and more appropriate equipment. The proposed instructional materials production center would provide about 1,500 square meters of space. This would include offices; photographic facilities; art and composition rooms; print shop; and audio recording, service and distribution facilities. The current technical and support staff-consists of six members. It would be increased to include sufficient numbers of printers, technical illustrators, photographers, audio-visual specialists, and support personnel to handle the required annual volume of materials. Based on re- cruitment goals and total enrollments, its annual production would exceed 100,000 pieces of promotional literature, 200,000 shop job sheets, 70,000 laboratory manuals and other items. The basic materials for production would be prepared by the public relations staff, subject-matter specialists, teacher trainers, business and industry consultants, and training center instructors. Appropriate inputs would also be made by the technical and production personlel of the center. Distribution of instructional materials would be through the local training centers. 4.07 Information and Documentation Center. The major objective of this center would be to provide an efficient system for the recording, analysis and retrieval of relevant data on: labor market trends; student enrollment and progression, training performance, job placement and follow-up; medium and long-term program planning; inventory control; and financial management. The proposed center would require about 3,330 square meters of total space. It would consist of facilities and equipment for offices, conference rooms, planning rooms, reference library, programming rooms, central computer room, storage and services. A small business-type computer and peripheral equipment would be installed. The center would be staffed by a center director, a computer system analyst, one or more programmers, a computer operator and support personnel. It would be administered by the office of the general director and would be governed by a board consisting of the heads of the respective directorates. Each of the directorates would have access to the central computing center. Additionally, the project would provide access to a small computer and appropriate peripheral equipment for each of the six regional coordinators of the CONALEP program. 4.08 Administrative Services Center. The proposed center would provide a total of about 4,630 square meters of space and a small amount of equipment to consolidate physically the widely dispersed staff (para. 3.19) of the central - 19 - administrative directorate and the seven directorates. In addition to the administrative offices, meeting rooms, accounting rooms and services, this center would contain the main technical library for the central complex and an auditorium. Technical Training Centers 4.09 The project would enable CONALEP to complete the first phase of its technical training program, the project would finance the equipment requirements for the 10 training centers now completed and partially opera- tional, the 52 training centers currently in various stages of construction (paras. 3.08, 3.09 and 3.23) and the 37 new training centers to be operational in 1983-84. The 37 training centers would be constructed and furnished from local funds. 4.10 The 99 training centers would be widely distributed throughout the national territory. The distribution by natural regions is as follows: Table 4.2: REGIONAL DISTRIBUTION OF TRAINING CENTERS AND ENROLLMENTS No. of Region Centers Enrollments I. North-West: Baja California Norte, Baja California Sur, Nayarit, Sinaloa, Sonora. 13 6,000 II. North: Coahuila, Chihuahua, Durango, Nuevo Leon. -14 11,000 III. Gulf of Mexico: Tamaulipas, Veracruz. 9 4,800 IV. North-Center: Aguascalientes, San Luis Potosi, Zacatecas. 6 3,200 V. West-Center: Colima, Guanajuato, Jalisco, Michoacan. 11 5,400 VI. Center: Hidalgo, Morelos, Puebla, Queretaro, Tlaxcala. 7 3,200 VII. Valle of Mexico: Distrito Federal, Mexico. 21 28,100 VIII. South and South-East: Campeche, Chiapas, Guerrero, Oaxaca, Quintana Roo, Tabasco, Yucatan. 18 7,600 Totals 99 69,500 - 20 - 4.11 Enrollments and outputs by major fields and programs of study are as follows: Table 4.3: ENROLLMENTS AND ANNUAL OUTPUTS BY PROGRAMS OF STUDY WHEN FULLY OPERATIONAL in 1985-86 Totals for All 99 Centers Programs of Study Enrollment Annual Output 1/ Agriculture: Beef Production 1,400 410 Food Processing 2,200 640 Services: Business 10,800 3,160 Hotel and Restaurant 4,400 1,290 Health 6,800 1,980 Industry: Building Construction 3,600 1,050 Electricity 8,800 2,570 Electronics 3,200 930 Foundry and Hot Metal Working 3,200 930 General Manufacturing Processes 7,800 2,280 Industrial Chemistry 3,800 1,100 Installation and Maintenance Mechanics 600 180 Instrumentation 700 200 Machinists 5,400 2,290 Metal Fabrication and Mechanics 3,200 930 Motor Mechanics 1,200 350 Refrigeration and Air Conditioning 600 180 Textiles 1,600 460 Advanced Welding 200 60 Total 69,500 20,500 1/ CONALEP's estimates, assuming a 20% dropout rate. It is expected that about 30% of the training places would be held by women., 4.12 The curricula, which are more fully discussed under paras. 3.08 to 3.10, are complete for the first 62 centers. Course syllabi for the first- and second-year programs are complete for all programs of study and the third-year syllabi are under development. The curricula for the 37 new centers would be basically the same as for the first 62 centers and no major changes are required. 4.13 When fully operational in 1985-86, the 99 training centers would require a total of about 5,550 instructors, or about 4,100 additional ones over those curtently employed (para. 3.23). It is not expected to be easy to recruit and train this number over the four-year period of 1981-84, but CONALEP is expanding and upgrading its instructor training programs and recruitment procedures (paras. 3.11, 3.13 and 4.14) to facilitate the solution of this problem. - 21 - 4.14 Trained manpower for the highly skilled and advanced machinist and tool and die-making trades are in very short supply for the more tech- nologically advanced industries (para. 3.23). The project would finance the equipment needs for a special training center for this purpose in Mexico City. The center would have a capacity of 500 adults in each of two 24-week courses each year. However, provision is made for courses of shorter lengths according to individual needs. Entrance would be limited to experienced adults who can demonstrate a high level of skill on regular machine tools. Course syllabi and shop job-sheets would be mainly supplied by the manufacturers of the specialized machine tools used in the program. An industrial advisory com- mittee for the program would assist in the continuing adaptation of training exercises to current manufacturing conditions. The 80 instructors required for this specialized program would be recruited from industry under cooperative arrangements on a part-time basis. 4.15 Criteria for the Creation of New Centers. CONALEP has developed criteria (Annex 4) concerning the eligibility requirements for the creation of future training institutions to be developed under the project, and, jointly with the Bank, has developed guidelines for the allocation of equip- ment funds. New Centers would be established on the basis of economic need, feasibility and economic efficiency. These criteria are reasonable and acceptable to the Bank. They would serve to ensure timely and efficient achievement of program objectives and provide for an equitable allocation of loan funds between and within training institutions. During negotiations, CONALEP has provided assurances that, unless otherwise agreed in advance with the Bank, the expansion of existing training centers and the location of new training centers financed under t'ie project would be in accordance with the agreed criteria. Further Development Plans 4.16 Planning the further development of CONALEP is critical to its long-term success. During negotiations, CONALEP has agreed to provide to the Bank, at Bank's request, a draft of its development plan to 1988 for review and comment. This plan, which would be ready before March 31, 1983, would include: (a) estimates of demand for skilled workers and technicians by industry, occupation and geographical area; (b) an analysis of program policy recommendations, including shorter training programs to respond quickly to changing needs; (c) CONALEP's expansion plans, including enrollments, outputs, and instructor requirements by training program and geographical distribution; and (d) facilities and capital investment requirements; and recurrent- cost projections, including a timetable of measures to reduce the high recurrent unit costs of small centers. - 22 - Preparation of Future Projects 4.17 The project would also include funds for preparation of a future project for the further development of the CONALEP program and would utilize to the extent necessary the technical assistance included in the project. V. PROJECT COST, FINANCING AND IMPLEMENTATION Cost of the Project 5.01 Investment Costs. The total cost of Phase I of the CONALEP development program is estimated at Mex$5,054 million or US$215.1 million equivalent. The estimated total cost and foreign exchange components by main project items are summarized below: - 23 - Table 5.1: ESTIMATED TOTAL PROJECT COSTS BY PROJECT COMPONENT a/ % of Mex$ Millions US$ Millions Base- For- For- line Local eign Total Local eign Total Cost Instructional & Administrative Support Complex 104.11 55.68 159.79 4.43 2.37 6.80 3.9 10 Technical Training Centers b/ 338.40 603.48 941.88 14.40 25.68 40.08 22.8 52 Technical Training Centers c/ 971.02 647.66 1,618.68 41.32 27.56 68.88 39.3 37 Technical Training Centers d/ 723.57 678.68 1,402.25 30.79 28.88 59.67 34.0 Baseline Cost 2,137.10 1,985.50 4,122.60 90.94 84.49 175.43 100.0 Contingencies Physical 86.01 170.38 256.39 3.66 7.25 10.91 6.2 Price - Increases 371.30 298.45 669.75 15.80 12.70 28.50 16.2 Subtotal 457.31 468.83 926.14 19.46 19.95 39.41 22.5 TOTAL PROJECT COST 2,594.41 2,454.33 5,048.74 110.40 104.44 214.84 a/ Project costs exclude in kind donations (para. 3.16), of which sites account for an estimated value of about Mex$760 million. Project costs, however, include Mex$690 million in sunk costs. b/ Equipment only; construction already completed. c/ Expansion and/or remodelling, furniture and equipment. d/ To be constructed, furnished and equipped in 1981-83. - 24 - 5.02 Estimated project costs by categories of expenditure are summarized as follows: Table 5.2: TOTAL PROJECT COSTS BY CATEGORY OF EXPENDITURES Mex$ Millions US$ Millions Base- For- For- line Local eign Total Local eign Total Cost: Construction 1,924.69 422.49 2,347.18 81.90 17.98 99.88 56.9 Furniture 39.71 8.70 48.41 1.69 0.37 2.06 1.2 Equipment 172.70 1,554.31 1,727.01 7.35 66.14 73.49 41.9 Baseline Cost 2,137.10 1,985.50 4,122.60 90.94 84.49 175.43 100.0 Contin- gencies Physical 86.01 170.38 256.39 3.66 7.25 10.91 6.2 Price In- crease 371.30 298.45 669.75 15.80 12.70 28.50 16.2 Subtotal 457.31 468.83 926.14 19.46 19.95 39.41 22.5 TOTAL PROJECT COST 2,594.41 2,454.33 5,048.74 110.40 104.44 214.84 5.03 Basis of Cost Estimates. Estimated civil works and furniture costs for the project are based upon unit prices derived from current contracts in Mexico and detailed estimates of other projects of similar nature. They are adjusted to reflect regional variations. Professional fees and site development costs are not calculated separately. Construction would follow detailed standard modular plans by size and type of training center. Equip- ment costs are derived from preliminary and final lists. Cost estimates do not include any identifiable duties or taxes. 5.04 Comparison of Unit Cost Estimates. The unit area and unit capital cost estimates are shown in Table 5.3. They are generally comparable to similar projects in the Bank and in the Latin America and Caribbean Region. - 25 - Table 5.3: UNIT COST COMPARISONS (Base Cost in US$) Project LAC d/ Bank Wide Construction area/student place 89m 2 a/ 9.6m2 10.0m2 Building Cost/mr2 US$300 US$330 US$390 Construction cost/student place 2,700 b/ 3,780 4,570 Furniture cost/student place 50 c/ 220 390 Equipment cost/student place 2,000 1,780 2,260 Total cost/student place 5,050 6,110 7,610 a/ 27% of total student places are in the bus ness and health fields, which require only an average of about 5 m per student. b/ Project construction costs per square meter, considering the differences in base years, are less than regional averages because of the simple steel frame type of construction. c/ Does not include laboratory and shop tables that are included with equipment. d/ For similar projects in Argentina, El Salvador and Uruguay. 5.05 Contingency Allowances. The program cost includes a physical contingency allowance equal to 5% of the estimated baseline costs for all construction and furniture of those buildings constructed after February 1981, and 10% for equipment. About 70% of the total costs of construction would be done after February 1981 and physical and price increase calcula- on construction and furniture are based upon this amount. Project costs also include price increase contingencies on base costs plus physical contingencies beginning in January 1981 for construction and furniture and beginning July 1, 1981, for equipment. In view of differences in prevailing rates of price escalation for local and international market prices, price increases for civil works were calculated separately for local and foreign costs. Expected price increases during implementation are estimated as follows: - 26 - Table 5.4: EXPECTED PRICE INCREASES DURING IMPLEMENTATION 1981 1982 1983 Local Foreign Local Foreign Local Foreign Construction and Furniture 25% 9% 20% 8% 15% 7% Equipment 12% a/ 12% 10% a/ 10% 8% a/ 8% a/ It is assumed that price increases for equipment, to be effective, will follow international price trends since they are to be procured largely through ICB (para. 5.06(c)); i.e., local suppliers will not be awarded contracts if their prices exceed international competitive levels. Accordingly, total price increases during the implementation period are expected to be about 24% for construction and furniture and 13% for equip- ment. Aggregated price increases are estimated at about 16.2% of baseline costs plus physical contingencies and total contingencies are estimated to be 22.4% of baseline costs. 5.06 Foreign Exchange Component. The foreign exchange component is estimated at US$104.6 million equivalent or about 49% of total program costs. The calculations of the foreign exchange component are based on the assumption that (a) all construction and related professional services would be awarded to local firms, (b) all furniture would be awarded to local suppliers, and (c) all equipment, except for minimal amounts, would be awarded as a result of International Competitive Bidding (ICB) and Local Competitive Bidding (LCB) in which foreign suppliers participate. The resulting foreign content of each category of expenditure was calculated at 18% for construction and furniture, and 90% for equipment. Recurrent Cost Implications 5.07 When fully operational in 1985-86, the recurrent costs of the project are estimated in 1980-constant pesos at Mex$ 1,635 million (i.e., US$69.6 million), or only 40% higher than CONALEP's 1981 budget of Mex$1,171 million, capital expenditures excluded. CONALEP's future operating budget represents about 1.1% of projected public recurrent expenditures on education in 1983. Modifications under consideration by CONALEP, regarding the optimum size 1/ of individual training centers could reduce the recurrent unit costs of smaller centers by about 20%. It is expected that these modifications would be applied to a small number of the training centers operational in 1981-82 and about 75% of the number of new places added by 1983. In view of the high priority of the proposed program, and the Government's strong commit- ment to expanding output of technical manpower, it is expected that those expenditures will be met. 1/ The analysis of the operational costs of different CONALEP centers showed that per-student costs could be reduced 20% by replacing the 400-module center (two programs, two shifts) by the 600-module center (three programs, two shifts). - 27 - Project Financing and Disbursement Plan 5.08 Financing. The total project cost of US$215.1 million would be financed as follows: (a) the proposed Bank loan of US$90 million would finance about 42% of total project costs, equivalent to about 86% of the foreign exchange component; and (b) the government would finance 58% of total project costs; equivalent to 14% of the foreign costs plus all local costs. To facilitate the early procurement of the equipment required for the training centers to be operational in 1981-82, it is recommended that US$4.0 million of retroactive financing be made available for equipment procured from February 1981 onwards. 5.09 Disbursements Plan. The proposed loan is expected to be disbursed over a period of about three years on the basis of: (a) 100% of total expenditures for the construction of the instructional and administrative support complex; and (b) 100% of total costs for imported equipment, including cost of installation where applicable; 100% of ex-factory costs for goods locally produced, including cost of installation where applicable; and 85% of local expenditures for off-the-shelf purchases. These percentages would be adjusted as required, to assure continuing financing for each category for the implementation period. - 5.10 The estimated schedule of disbursements by calendar and fiscal years are: Table 5.5: ESTIMATED SCHEDULE OF DISBURSEMENTS (US$ million) Accumulated Undisbursed Disbursements Disbursements Balance CY Sem FY Sem Amount % Amount % Amount % 1981 II 1982 I 3.0 3.3 3.0 3.3 87.0 96.7 1982 1 II 9.0 10.0 12.0 13.3 78.0 86.7 II 1983 I 18.5 20.5 30.5 33.9 59.5 66.1 1983 I II 39.5 43.9 70.0 77.8 20.0 22.2 II 1984 I 20.0 22.2 90.0 100.0 0.0 0.0 - 28 - Since this would be the first education project in Mexico,,there is no specific disbursement profile with which to compare the above schedule. The proposed disbursement schedule, however, exceeds substantially the average disbursement performance of previous education projects in other Latin American countries. This is justified by the advanced status of preparation as indicated by the equipment bidding already in process (Table 5.6). Implementation, Procurement and Auditing 5.11 Project implementation would be managed effectively by the regular CONALEP administration. The Director General would act as project director, with the Director of Administration and Finance serving as project finance officer, the Director of Buildings and Equipment handling all procurement, and education and training matters being handled by the Director of Operations and Teacher Training. No additional staffing would be required, except that additional part-time help would be required during the equipment bid evalua- tion periods. Budgetary arrangements have been made for this additional staffing and no problem is expected in the recruitment of qualified assistants. 5.12 Standard modular plans, acceptable to the Bank, have been used in constructing many of the existing centers and would be used for all the planned centers. Civil works designs are complete for all extensions to existing and new centers. Construction would be by competitive contracts. Supervision of all new construction would be carried out by CAPFCE, a semi- autonomous agency of the Government, which does all school building construc- tion. CONALEP's construction will add only about 5% annually to the total construction under CAPFCE; it is therefore not expected to strain the imple- mentation capacity of CAPFCE. Sites for 24 of the 37 Centers to be inagurated have been secured; no problems are expected for the remainder. The design for the instructional and administrative support complex is underway and is expected to be completed by August 1981 and would be sent to the Bank for review and comment. 5.13 Implementation Schedule. The construction, furnishing, and equipping of all institutions is scheduled to be completed by December 31, 1983 (Annex 7) These schedules are considered to be reasonable, within the capacity of CONALEP and CAPFCE, and would serve as the basis for monitoring program implementation. Expected completion dates are listed in the following table for the critical activities in program implementation. To allow sufficient time for submission of final withdrawal applications, the Closing Date for the proposed loan would be June 30, 1984. - 29 - Table 5.6: IMPLEMENTATION SCHEDULE Furniture and Equipment Only New Construction by Phases 1981 1981 1982 1983 A B C Civil Works Commencement of construction (2-81)* 1-82 1-83 Completion of construction 12-81 10-82 10-83 Furniture and Equipment Completion of lists and specifications (4-9-81)* 7-81 11-81 11-82 Advertising of tenders (4-20-81)* 8-81 11-81 11-82 Awarding of contracts 8-01-81 12-81 3-83 3-83 Installation 11-15-81 3-82 8-82 8-83 * Activities already completed are in parenthesis. 5.14 Procurement. Civil works total US$57 million (base line costs). Work would be scattered over one hundred sites in the 31 states and the Federal District. Except for the International and Administrativeb Support Complex, none of the individual contract costs would be great enough to attract foreign bidders. Mexico's construction industry is highly developed and capable of executing works at costs competitive with international bidders. Construc- tion contracts for the scattered training centers would be awarded on the basis of LCB under normal government procedures. All new buildings are constructed from standard modular plans acceptable to the Bank. Nearly all sites have been acquired, and no problems are anticipated in this regard. The contract for the Instructional and Administrative Support Complex (base cost estimate of about US$5 million, paras. 4.03 and 4.08) would be awarded on the basis of ICB procedures. On the basis of Bank experience, however, it is unlikely that foreign construction firms would be interested in this bidding. 5.15 Equipment costing about US$84 million would be procured mainly through ICB. The lists, specifications and bidding documents for the first 62 training cente-rs have been developed with the assistance of induptry and have been reviewed and found acceptable to the Bank. The remaining lists for the other 37 schools would be nearly identical and need not be sent to the Bank for prior approval. Because the first 62 training centers (40,000 students) are to be fully or partially operational by October 1981, equi'pment procure- ment under ICB and LCB (which are acceptable to the Bank) and in which foreign - 30 - firms would participate, needed to begin by April 1981. To help facilitate early procurement for these schools, up to 15% of the total equipment costs would be procured through LCB. The participation of sufficient numbers of local and foreign suppliers (about 100 of which have offices in Mexico) is expected to result in adequate competition to assure economic prices. Equip- ment packages in excess of US$300,000 would be procured through ICB procedures. Packages of between US$25,000 and US$300,000, not to exceed about US$13 million, would be procured through regular government procedures, which are acceptable to the Bank. Small items or groups of items estimated to cost no more than US$25,000, not to exceed a total of US$3.0 million, or items of a specialized nature for which ICB or LCB would not be practical, would be procured through local shopping. Under the above procedures it is expected that about 82% of total value of equipment purchases would be procured through ICB, 15% through LCB, and about 3% through local shopping. 5.16 Recommended contract awards for equipment would not be referred to the Bank for prior review, but CONALEP would retain bid evaluations and contracts for random ex post review by Bank staff during supervision missions. These reviews would cover all contracts of more than US$300,000, which are expected to comprise about 40% of the total value of all contracts. For the purpose of comparing foreign and local bids, domestic manufacturers would be allowed a margin of preference equal to the prevailing tariff or 15% of CIF costs of imported goods, whichever is lower. 5.17 Auditing. CONALEP has a Financial Directorate devoted to appropriate recording and reporting of the program's financial transactions including accounting and internal auditing control. It is adequately staffed with experienced accounting personnel and its director has more than twenty years of experience in this activity. CONALEP is also to be audited by a private firm, as required by the Mexican Government for all semi-autonomous agencies. Monitoring and Evaluation 5.18 Monitoring. Efficient monitoring and careful supervision of project implementation is essential for proper project implementation. As all civil works would be the responsibility of CAPFCE, its own architects would supervise the day to day design and construction of all buildings. CONALEP's own architects would closely monitor actual progress in both design and construction. Equipment and furniture procurement and installation is the immediate responsibility of the Coordinator of Equipment and his staff, but is closely monitored by the Director of Buildings and Equipment. A well-designed checklist for use in monitoring implementation of construction, furnishing and equipping of each institution has been developed by CONALEP. 5.19 Evaluation. The Directorate of Planning would coordinate the activities of the directorates of evaluation and certification, buildings and equipment, and operations and teacher training in evaluation of project implementation and its impact on the manpower training system and socio- economic development. This group would be assisted and advised by the regional training coordinators and the industrial advisory committees. - 31 - VI. BENEFITS AND RISKS Benefits 6.01 The proposed project would strengthen technical training at the middle level. First, the proposed project would contribute to the institutional development of CONALEP by bringing together widely dispersed directorates. Thus, the agency's communication, coordination, and administrative efficiency would be significantly advanced and its cooperative programs with the pro- ductive sector reinforced. Second, the proposed project would enhance the quality of training by: (a) providing the necessary equipment; (b) emphasizing the practical aspects of training (50% of the weekly schedule); (c) furthering CONALEP's instructor-training capability; and (d) expanding and improving the production of instructional materials. The CONALEP program emphasizes an effective evaluation and follow-up system, for which a special directorate has been created. An active industrial advisory system at the national and local levels would help assure the continuing relevance of the training programs. Third, the output of skilled and technical workers from the 99 training centers would help reduce the wide gap between supply and industrial demand. 6.02 The major quantifiable benefits of the program, when fully opera- tional in 1985-86 would be an annual increase (or upgraded skills) of about: (a) 20,000 skilled workers and lower-level technicians (of which 30% are expected to be women); (b) 800 technical teachers; and (c) highly specialized skills upgrading for about 1,000 employed workers and technicians. Assuming that other formal training programs would increase their annual outputs to 20,000 by 1986, this would still leave an annual average requirement of about 136,000 skilled workers to be met by further planned expansion of the CONALEP and CET technical training programs, on-the-job training programs and other sources of skilled workers. Risks 6.03 The proposed loan entails some degree of risk, especially with regard to the problems encountered in the recruitment of morning-shift teachers and the high student desertion rate during the first year of operation in 1980. A major contributing factor to this high desertion rate is the currently strong industrial demand for employees with even minimal levels of skill training. However, the procurement and installation of appropriate laboratory and shop equipment is expected to have a strong effect on both of these problems. Additionally, the ability of CONALEP to pay higher salaries than technical schools under the Ministry of Education should diminish the problem of teacher recruitment. Therefore, a favorable student-teacher ratio and the well-equipped facilities are expected to reduce these risks, and result in appropriate levels of student retention (80% over the three years) by the time the schools are fully operational. CONALEP intends to monitor closely instructor and student retention, and to take prompt immediate action should desertion levels remain high. - 32 - VII. AGREEMENTS REACHED AND RECOMMENDATIONS 7.01 During negotiations, assurances were obtained from the Government and CONALEP that: (a) the annual work programs for the instructor training center, the instructional materials production center and the informa- tion and documentation center would be sent to the Bank for review and comment (para. 4.04); (b) the expansion of existing training centers and the location of new training centers financed under the project would be in accordance with agreed criteria (para. 4.15); and (c) the draft development plan to 1988 (para. 4.16) would be sent to the Bank for review and comment. 7.02 Up to US$4.0 million of retroactive financing should be made avail- able for equipment procured from February 1981 (para. 5.08). 7.03 Subject to the above conditions, the proposed project constitutes a suitable basis for a Bank loan to the Government of Mexico of US$90 million equivalent, with a term of 15 years, including a grace period of three years. 33 LTNITED PMICAN STATES L.TECHNICIL UL1jTNq.LRq4ET CIMPATAtive Ed tion Indie.t.- ANNEX I Page 1 o 2 JUNE 1 1981 i :CAPITA: 'GOVT. EDUCATION :LITER- PRI. :CUKPLE- :STU-':UNIT COST:PRUGRESS-: SEC. !STU- 'HIBHER: AT FXP.QN RErURRENT ENROLLITI 0N UENTS-PRIM. EE, '.ION RhTE 'ENRULL-DIENTSIENRICE L. MARKET. % GNP :ED AS%:EXP AIA.?CATED. RATL 1RATIO :RATE FIIR PER ASA1 SNPtFRGM PR !RATIO WER :RA11O EL P. PR, Er IIEVOTED PLj;.EX p Tcj. :1 OF LNET :PR SCH.:TEACH C PITA :TIF REC.1 ET :TEACH- 605S: SF 'ILE(y): (Y) 11%) iLR t'.,t PRI. HI. AE, YR MILLS. WE$). TO EIIU.:DN ECiLJ LJLTS) . (Z) :CYC !ER (1) (2) (1) (4) (5) L [6 (7) (B) (9) fi(l) (it) (12) 1(13) -(14 1 ADVANCE E, AU61RIA 74 7:'511 7,520H 5: 31, 24Y 51Y IS Y 99 913 93C 2, 10:7C 99r 51 r, I 91, Bly CANADA 7 8 iL 3 39 23 99 I00 I00 21 17 6 100 92 18 Z"5 oo GERMANyF, kFf'. 6 13 . '3" 1 08 , :S'70 0( 4.BL) 4.66P 9 I00 100 22D 12 9v8 8 9Y :CDy, El ';UY ;;O 5 99 9 20t, 24 69 JAPAN 4 9 7 700H 4 3DW 20.7r, ;(')IIY UY1 99 NETHE LIE, 7 3Y 9 200 B., 94.2 20 35 24 99 -?6 93 t? 17.8 9,9 8- 13 12 00 NELZUALARI, 7, 3_'H 5,53011 52W 39 24 29 99 99 99 P 6 III: 4 99F 6 9 24:10 ,'60 7 L- NCIR A) 6 4. OH 9 5 i'4 54 24 15 99 99 ?9 16 5H 99 6 1 ti0 SWL E 78 83 0540 88F;W 60.7 37 11 I( 99 99 OD 16 7 100 79 13F 30 .0 OD 5 I? ti 75 5 FM 5 72OH 7.1w 26 41 IEI 91y 99 24 6ki 1.((x U:S.A. 713 218 711. 14.3 - Sy**: 10 99 96 99 22e 99 97 1 913 41.00 &PLECE 7f, 9:AH 435014 2 6 w I1)0 37Y 26Y ?,41 BbA 951XY a 2 E 3 1 6 211 70D S? t f 1, 74 7I? 3B I C) 11 : I R 1:114 13 1y 98 1(B 99A 35 5A 6.XY IA O I i B4 , 9 L t, Y7 9II I940H 3 6W 41 1 7 E32 60*c 19 75* Y 5 00 R([;MANUA 1, I. 1, I 9 'I 13 jX I 9 1, t, ), H 2;6y 12Y1 9(A (IXY 98. 4 0.00 6 IH 96 H 4 49 9 I 5 35 7 1) iSy I A ... I x y 3 I7 6p-Y AF R: I t, 1 0 RI A 79 1 El 1-45t4l 7.114 101). r, 34t, 26K 2JK 35H 94Xr, 450 37K 11.9 51Kll 33KT 37K 5.OOKX N, I n 3 _20H 7 2NU 94 OC: 4?0 230 100 I 11, 44XY 706 53Y 4B.2A 43P iix 3YrS 0 ?4Y 7b :13 66H ,:AIW 100:OF 4riR 35' 13 35 eox 70 31 9.13E 20 1 :5 C,L;11:5111I 7H (4" ) 11, -/W I00. 46 33R I R 2t, 23 45 32 31 51- 202 3x 16 05( CAMEpootl Y, E' "9 (H 37W I 33 43 C 6(XY 45 11:11 20 9b 24 0 9orly DCW 1 ',6 1 25 25 8 BXY 27 0 21Y C, A i I .9H OH I D H 69Y I.. 11 I ey 7, 4 29 ... HAi"" 3 H 15014 3 OW 1 78 -1- 30 65BY B 2XBY 30 O.OIBY COMOR(Ili 80 0: I" 11,DH 53. 40 28 14 2OF Y9X 66 45 16:11A 5B 21 30 1.4 CONGOp 74 1 !300 6 1 63 63 13 3 48 33K 22 3:40 .!),W 40. 32. t. 501' 33X 0 3 82 49 17, 5 00 EOYPT 71 131 9(.FF IS ze 9( 30 1 . L PLO 15 S13 9.. 5' 11.0 . OF ... y 4 t ... ETHIO 7? '3" 'O. " ::. :. GAS 74 11.6H 3,370H 5 DCIW 100.0 25 1) T' 101 25r, 46C 4 71 1k '31Y 21C 0.29Y ON 0. (,ti 1 33w ... &IA 7 ', II, BOH 4 ' 2! 6 -7 1?0 33 41 7 9 IXy 25 111HANA 74 OH 3 1l3Y 22Y 2GY(1 6OXY 62FI 30Y r, NX 16ry i:;gy GLIJ ME 5. tii ,60 -.,w) I0 3 L 3( zox 64 4F ;l;:', /6 1 26 4 00 IVC)R COAST 7" 7. JH 91, t)H 6,1314 I1) f). 33 46 1-3 ;A 50 86 43 197 47 17XY 26 1:64Y KE NY A 7" 15. .1; 80 5914 8D. )I is J4 45 92 74 40 15.8 41 1 Y 28 1 .0 LESOT 4O 7? I.-S 340 4.1 6-L 41 29 20 52 68 32 49 B.0 65 15 23 0.90 LIBER JA 77 1.7H 460H 3114 23 26. 30 51x 54 27." 76 24X 16 ,)SCAR OH 3 1 So MACIAG 7-, 8'ifif 215 4.OW 111 - 0 53 B 90 44 ... 38 14 23 i:o MALAWr 7,9 5Y (I 2 99:1111 40E 29 17H 14 Io.OG E X H 1, -0- 59 62E So 6x 21 MALT 5 6.311 13t) 4:2MW 00 OD 4.., 31E I8 I L 22XE ... 48 5DF 6 21 MAURITANEA 7.1 1 . H 270 1 4,IYW 17xy 2211 ;;, 3XY 21A MAURITILUS H 7 W I( 6 BOB 94 24 5 ;.50 7 6 0. 'PH 92D 4 ;:C It) 2 4 3- MORD Co 79 1R.91q 68DH 36 44 21 211 68 Y, 35 39 19 7 40 20x 21 5 00 NICIE R, '? 5. OH 24OH '2' E33 W14 52 43 5 a 17 50 39 313: 7 35 2 24 .:. NIGERTA 74 80 MI 6fDH 4 ICY ... 23Y 16Y 42Y ... 49xy ... 34CY OXY 206Y 0 48Y RWANDA 73 4:H 190H 3: 2BW 23 52 51 ::: ::: - 2 13 0:230Y 360+1 50 10 2I2 4Y 21.6A 20 21 1.5 BENEGA 7Z 5 4H 2 IC) SIERRAL 73 33H 2.40H 34W ioo,1) 31 36 3( 151? l4X 45 32 13.7C 68 isx 21 0.53AY -O 2 0 s is I a SONAUTA 7R 13,)'H i`45H 1.5u iOO.O 55 I( 21 so 44 3 2 40 SUSAN 76 7 4H 340H 4 W 64.0?S 4B 36 16 2D 34 33 46 33 14 24 1.4 SWAZILAND 7B O.."H 5BD 6I6W I0.0 37 33 3 65 S"X 49 32 66 32X 20 2 oug 0 6 D. 1 66E 17 2 :3 TANZANIA 7P, 17 1. 23 BNW iOD 0 43 19 96 87 58 1 Ir 4 u 0 1 TOGO 77 :4 3-0 5 FIW 30 28 2 18 74 40 58 13.313 592 404 01. '. I P, 79 6 130 7 : 39 41? TtiNi W I00 0 42 1 62 10D so 39 1I 30 30 30 60 7"i 3C 2 -A 3 34 oy 14A IA 0&Y UGANDA , I4H '80 H" .4 Y 340Y 4ODY 2DY 25 5 XY ... 6xey 2 : so UPPER Vtli-TA 7' 56H 160M 3.4W :L 16 32 5c 13 23 51 52 51? 19 2 25 1.0 ZAIRE 76 26,8H 24OH? 6,W ... 49 26 25 1.11 86X 44 42K 20:OA 41 13X 27 I.OOx ZAMBI P. goS.7 540 5.6 100.0 48 23 22 44 YFJX BO 48 12.9 19 1;1 22 1.30 CENTRAL AMERICA ANIS THE CANIFICIC-AN BAHAMA", 79 0 2 2, 'AO 6:5N I(D:O 36 36 1 1 93 I? 9 X 97 24 97 75 I BAFOAL' 1)S 76 0'2 2,080H 8 IW IOD 0 43 31 L6 99 106 99 21 1;:;F 99 94X I7 COSTA. RIL:A 711 21. I,61 0 6.6 ... 37Q 2 ? 14 3( 91)[I 93 77 32 11.8? 77 39* 19 13.0ox CUr'A 7H 9 ;111 I'Doot, 8: 11 16 9 8 98 22 9a 65 Is I00 - L 9(O 30 51 GO 17 54 63 14 24 00 DOMINYCAN REP,72 5 7: EL. 5 3 H 64 62 as Y, 32 3 3 21 7.00 ALVADOR 77 4.,H 640 4B 8 27 9 ... 41 2 GUATEMALA 73 6.6H 930H I.9 23 14 4/ 64 26 35 25 4 09Y e, 4.8H 240M 1.0 1 13 ;: HAITI 7 I(O.0 61 21 -t 23 29F 13 56U 62 0 7 HUNII LIKAS 711 3.11 41111 4.2 621 1FF IF 60E 7EI 30 35 12.8?F 68 it 4.00 CA . H H 90 91 52 39 6:4A 25 JAMAI f. L 9D ... -17 33 22 94 114 7 58 MEXTE Cl B( 67.4 I E1111 4.1 91 I 46 59 11 9' 1. 49 40 9 5 el .4 i7 10.00 NICARAOUA 73 2 60 1)W DD'D 61, I,.'L I3 9(L 6.1 24 7.3D 30 4L 37 7.001D F'ANAMA 71: El I :2 6OH 5:4 4 2 Li 1301 i3 7EIA 97 B 12 D 3B 11:6, 1156 49 349 20 TRINID 11 3 101, 4 5 48 32 20 9:j 913 1 30 10 5 9 62 24 E, & T. 77 1. :!o SCUIH AMERICA A R C) E N 7 1. N 1) 7 ri 26.,7 I "? 1. o 4.4 4 3ii 31F I ti G' 93 89 52 i7 ... 974 31 8 23.00 POLIVIA 76 5.3" 510H 5. 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TRAINING PROJECT EnCorarltie Eduction Indicator ANNEX 1 PaNe 2 of 2 JINEP 1 19311 GNP00/1 ICENHTEDARO :% DI ILJIACIC tlI I FRI .F E;URRIENI: I 1E11 I * I/OEl AI I:1)v I.IEEtI CATIEN : lISTED- I FiR IC EIFLFI E I 13- I:LIN FT C1DSTI! I ORE IS-; SE C. 11I i-I 1: OF[[ * I Al I FKIP.DN IR~PXI, RE I RE, T IEROIL F 11550 E NLTE: '00 1.11 OEI NSL CT:EF1L OAF / 01 Fi " DI! A-L,TE ROII AIL 10S FIT I FF 10 0~ DIMP/F RI) PR I .FATIF .FPI .1011 II I LCF''EIIITO E I F. LI ,., 1FFI S LI I.CFc IFTI COPIED :I11 IF Al Il YF T /1.0]IL ,, FLIED TI) AR FI LOIS POE SC. FF, 011FF 1)1 / ClIFF /F FF A11IA AND OCEANEA APFGFHANISTAN 77 F4 .i 0 LE E. 101.1 47Y 19' 15Y 2 9 69F.F1 I" 62 17 1 Dl 'HLIAO F 73 Al 9H I440 220' 210 FEF SI OAF' 1.0 0 ElF ISAD50 SE III6 91.0 1.0 All I "21 CIINOFIFS ' IE*H SOl ,O 231 571, 1 1 .. 'S1 7N-10164 0.9110 E,IFIS 1.20 Y 50 SR 51 / /1, 51.. 41 IFI 2 lIA LI RON IA B 0 . . 2 55 0I EIl~G9 c liE HAI0 2-00E 1RAN3EDI /S lAH(BI1 FIR A7'4 70 18 I 00430 1% III 5, OFFAl S 60 1'NIE(HR 75 "1IOF DO 1 11001 .7 I6H4,/OFF.0 DR 5 "BL 23216I O 22X ~ 11500SFEAl a.O F191 A I B/1 I I F' ':" I I SD' FHLI99' lFFFN 2' .0.1H 10.1 Al 40FL 7, 00 6 F2R- E OFZ (I IFL A YF IL /06 000 3ii1 150H 6.200W D70I IE 42 394 L'S ' Xl D O F 'FL AN 020S9 SO/N2 A7 090 .qX TOIIILANL' 7, 00. ON 2F. 2 0095602 I2II ASX 11.1FF2OX SF4I00 9.1FF 010F 0.i1Sf 141.0 O64 3O 76 F 7 5 B00 14~ 3 50 719. 7 705 17 2RIT TENON~~~ ~~~ F2 1 1.1 00 1Y0. . '2AII40 00 1 10 10.40 "0 '1X I I II 110 E1I 74 'FO 2.I S l ELLI 160H w Tm 9Y1S4 ASy9 1F IIII EE 1 0 0 91 9 0 S DI11 71I IFF 9 8 LINERII 7~ 443 5 lOFI 104 J E! 21 IES 84 e 5~ 75 20 DE 1, 11 1 11 OFFERS I i ~111D. ' 21 OWRF'FE 01F I' II,P1 1 301 CIC0 1: 0 2K OR 0 1 01 0110 SUKMARY FOR DEVELOPING COUNTFR1F L'NF,CETRL 11'. TO)lEhA RANCE: ((-5- ~~~~~~ 14/3 I' F 01,10 ODES TEOR6OS3OR-(.- I ( T 5) 91 10FF IliN FR9OE 69EFI TORE) 95 4 I 19R1( 9 UlILE5-E:LSE NL IJM UNOV` OR BEFORE M;~~~~~~~CLINERI IF PIR CERSUCS ARA O IIOR, ROT EFEEDI lTERIESIE 01RC"IL I IC= 91,FF L I UDl 0 DFOE rN0A01 I-OLUOSL IFT 105 RNDENT OR 01011 SEAN AlIS IONANR iRORE TAF E STARTED 10E S1TUDNT FF11 -10974 O F RI -1. NTNP ALF IS VTF ONtAOO- 110FlNSADWDFF IIR, '0RL 01001 lF 0100 0INOP TF 005 4 PLRPIMAIIDSFI OAAI RFYSF19I19FF -MINI110010 RF'PEDYST 0ON I t RO" K ISOIIONY311 T 4 H9RIIF' MI101FF ERRREDIIEL ON TFFINE WIJEATH HIGH TIR FOTEL976 FFK H01IF 1 OF AFNL .FRTAT H FLIL1R50 GIIHTVT NSIFFUCONE/ ALUNESC0 I'FE MAR ELLLI IL I Il LIETI 101 TI EG= E HE F1,)EE S1 01' LEEROO F) 1111ALN010 T O L CSCSE T DOE RIEOOLIR OF 001 EPOARDLEIS OP TEll (F I 1101101 TF 1001CM. AI,RIF 1FF X 11U10011 A C IF) L 191010 RTI I ElIF Al RF S HTE 011 NF'7 IIMEILIIT1U91'.1a00 ELDUBI HE R ONLY ONROL IR EAIN ONE II IIITIIL HA RO R] 01 1F 111JO 0~99 ' TNT E ~IMElFJD101FF'R01 A01 ' ET N EST IIJK LAF LIIITElF FLI IJL N L'FE 10 IFE 0AL L' 9 ', I PL AL CHIL EXLE001' 1FF WAI ATN EN L SRVIE O FOYIINN COMFADRTLL LDUHONEO RATIOA AF11E 7, 1'. OINl101 OIALUIATION 100 PVARIAOL EDUATIOTNF FYSEMSOANDE IFNELYSISL7FE CLTIVEO SAESE OFEULLA-IMEA LATL0911LOF1-UL Il COF ROT A FDI I TSOI FINEIL TA CRO 711 0 WLIDE) P03A IFB SERI IN TBE P REVELD01000 P101TN110 I OETHI 10I RI110E I BE V AOl CN 0L ElA I1 I YAL T'HE SI AIEII IS 011 F0 000 EOR VLFFNTI .ENTRSOURCES1 THE0 FEAI FE OIL 4STF 0OI ES DOER TOS ON IA H. NFM k i OF TIEFiL ORE I ILAI 1 0E 1MA HFIT. IL NDRAIZ0 1D1F RENITS INHDI A HL WITHI EL MITE CATE RHEC TH FR6 110110SFELY 011CAN 1101 TOSTEE TOWONE NLALSIATIDISIUD E RN I MND - 35 -- UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT Structure of the Education and Training System ANNEX 2 UNIVERSITIESS I NST ITUTES { } ~~~~~~~~~~PROFESSIONAL CECATAAGRCULTURAL TRAINNG C SNG STAFF OTHERS_ TEACHEARAIDR{ TRAINING ENAMACT _I ENAMACTrA CECATI INDUSTRIAL TRAINING CENTEF;S LE{}{ * BEING ELIMINATED EDUCATION CCTI SHORT COURSES IN INDUSTRIAL PREPARArcRY TRAINING { { : CCH HIGH SCHOOLS FOR THE SCIENCES AND HUMANITIES CCH CB ACADEMIC HIGH SCHOOLS CECYT CENTERS FOR SCIENTIFIC AND TECHNOLOGICAL STUDIES CB CETA CENTERS FOR STUDIES IN AGRICULTURE/LIVESTOCK CECYTEM CENTERS FOR STUDIES IN CECYT OCENOGRAPHY AND MARITIME AND SCIENCES AND L CETA _- IT-ECHNICIANS CECYTEM I I I~~~~~~~~-TEO L- ~ rET I~~ ~ I CECATI CONALEP L LABOR ~ ~ UPE rSECONDARY EDUCATION !89 Ii, CCCT i i | & ~~~~~~~~~~~~~~~~~~~~~~~~SEMII-SKILLED) I | ! | ! ~~INDUSTRIALTICNLG LABOR _ PRE 1 PRIMARY EDCTOU I AGRICULTURLERLIVESTOCK TECHNOLOGY SCOO SECONDARY ~' ' SECONDARY UCTN GRDAEFCEYTM I I l l I WORKERS l l l I l {}{1s{} \ ~~~~~~~ ~ ~~~~~~LABOR |& EDUCATN E NEOUCATTON GRADE l 2 3 4 S 6 7 a B 10 11 12 13 14 1 15 16 17 18 IW 20 AGE 4i 5 I 7 9 10 11 12 113 114 115 116 117 118 119 20 211 22 232 215 26 |PRE- I PRIMARY EDUCATION I LOWER UPPER HIGHER POST- LABOR EDUJCATION1 SCHOOL SECONDARY SECONDARY EDUCATION GRADUATE FORCE SYSTEM EDUCATION EDUCATION World B-nk -22872 - 36 - ANNEX 3 UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT CONALEP ORGANIZATION A. NATIONAL ANED REGIONAL LEVEL BOARD OF _ AVSR GOVE INQHSCOMTE EXTERNAL AUDITING GENERAL __ | ~ACADEMIC DIRECTORATEIRCTOAT OF _PROMOTION AND OFFICEOF ~~~~~~~~~~~PUBLIC RELATIONS OFFICE OF THE PRIVATE SECRETARY _ ~~~~~~~~~~~~INTERNAL _AUDITING DIRECTORATE OF DIRECTORATE OF DIRECTORATE OF DIRECTORATE OF EVALUATION AND DIRECTORATE OF DIRtECTORATE OF OPERATIONS AND ADMINISTRATION BUILDINGS AND CERTIFICATION LEGAL MATTERS PLANNING INSTRUCTION AND FINANCE EQUIPMENT OF STUDIES REGIONAL COORDINATING OFFICES S. LOCAL LEVEL | DIRECTORS OF | p ADVISORY | CENTERS GMIIIt I TRAINING l | ACTIVITIES I AMNISTRATION| World Bank --22873 - 37 - ANNEX 4 Page 1 of 2 Criteria for Determining the Location and Size of New Training Centers and Programs of Training The Board of Governors of CONALEP would approve the establishment of new training centers on the basis of their economic relevance, feasibility, and economic efficiency. These criteria should be utilized in the feasibility study of each new Center and should be the basis of the Board's decision. The weight assigned to individual factors may vary to fit the Mexican situa- tion. Detailed consideration of criteria is expected to include factors such as: (a) Economic Relevance Criteria. New training programs would be established on the basis of the following factors: (i) Economic Demand: Proposals for the establishment of new training programs, or the expansion of existing ones, should be based on an analysis of the relationship between national employment needs and the output from current training programs; (ii) Gainful Employment: The establishment of a Center in a particular location where sustained employment opportunities for skilled workers and technicians exist should have priority over the locations where local employment opportunities do not exist. (b) Feasibility Criteria. The feasibility analysis would include the following socioeconomic factors: (i) Social Demand and Geo-Demographic Factors: Proposals for the establishment of a Center in a given location should include the availability of sufficient number of ninth-grade graduates in the Center's area of influence and the lack of appropriate training opportunities beyond such grade in the proposed area; (ii) Instructor Availability: The proposal should also determine whether a sufficient number of instructors are available locally for the training specialties offered; otherwise, it should include specific recommendations as to how the required teachers could be obtained. (iii) Cooperation of the Productive Sector: Explicit interest of local authorities and leaders of the productive sector is a determining factor in the success of the program. Thus, offerings of a constructin site, building, equipment, partial release of instructors, or any other physical or moral assistance would be important factors in deciding on the establishment of new Centers or training programs. - 38 - ANNEX 4 Page 2 of 2 (c) Economic Efficiency Criteria. In addition to the above criteria, the analysis would include the following efficiency factors: (i) Economic Size: Proposals for the opening or expansion of training centers with less than 600 students should specify that per-student recurrent costs would not be unreasonably high. CONALEP's Board would fix the maximum acceptable ratio of these t costs in relation to CONALEP average unit costs. (ii) Minimum Class Size: CONALEP should establish the minimum num- ber of students allowed to run a program or course economically. It would inquire periodically about the Centers' compliance with this criterion and elicit remedial actions to avoid excessive unit costs resulting from the operation of very small classes. (iii) Other Efficient Alternatives: Training unit costs could also be reduced by establishing shorter training courses and by expanding existing Centers with ad-hoc training activities as required by the local productive sector. CONALEP would also consider these alternatives periodically. (d) Transitional Criteria. Project files contain a list of the 99 Cen- ters that would be, or are, partially operational in accordance with the above feasibility criteria, including agreements made with local authorities and the productive sector. These 99 Centers, which include 61 Centers with only 400 students, represent a total capacity of 69,500 students in two shifts. For the purpose of the present project: (i) the training centers with 400 students could be consolidated into larger, more economically efficient units, as long as the total capacity of the project is maintained at 69,500 students, and new locations meet all the above criteria; and (ii) the long-term plan (1984/88) would also address the means by which the smaller Centers could be transformed into more economically efficient units. - 39 - ANNEX 5 UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT Disbursement Plan Category Amount % of Expenditures (Including Ptice Increases) to be Financed (US$ millions) Construction I/ US$6.20 100% under ICB Equipment - 76.80 100% of total costs under ICB and LCB and 85% local expenditures for off-the-shelf purchases Unallocated 7.00 -S$90.00 1/ Instructional and Administrative Support Complex. 2/ Total costs, less US$6.3 million (plus price increases), being purchased with local funds. UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT ContinRencv Allowjances Construction Purniture Equiument Total Project Cost Local Foreign Local Foreign Local Foreign Local Foreign Total Contingencies (as a % of Project Cost) Physical 5.0 5.0 5.0 5.0 10.0 10.0 Price Increase 28.0 10.0 28.0 10.0 13.0 13.0 Project Cost (Without Contingencies) Millions US$ 81.90 17.98 1.69 0.37 7.35 66.14 90.94 84.49 175.43 Millions Pesos 1,924.65 422.53 39.72 8.69 172.73 1,554.29 2,137.10 1,985.51 4,122.61 % Foreign 18.0 18.0 90.0 48.2 Contingencies (Amounts) I Physical Millions US$ 2.86 0.63 0.06 0.01 0.74 6.61 3.66 7.25 10.91 Millions Pesos 67.21 14.81 1.41 0.23 17.39 155.33 86.01 170.37 256.38 Price Increase Millions US$ 14.45 3.17 0.30 0.07 1.05 9.46 15.80 12.70 28.50 Millions Pesos 339.58 74.49 7.05 1.64 24.67 222.31 371.30 2q8.45 669.75 Subtotal Millions US$ 17.31 3.80 0.36 0.08 1.79 16.07 19.46 19.95 39.41 Millions Pesos 406.79 89.30 8.46 1.88 42.06 377.64 457.31 468.82 926.13 Total Project Costs (With Contingencies) Millions US$ 99.22 21.78 2.04 0.45 9.14 82.21 110.40 104.44 214.84 Millions Pesos 2,331.44 511.83 48.18 10.57 214.79 1,931.93 2,594.41 2,454.33 5,048.74 % Foreign 18.0 18.0 90.0 48.6 Total Contingencies: As % of total project costs = 18.3%. As % of project costs without -ontingencies - 22.4% - Physical and price increase contingencies on consLruction and furniture are calculated only for the buildings to be constructed after the end of appraisal mission (2-4-81) and which comprise 701 of totaL cost of all construction and furniture. Price increases on buildings and furniture are calculated fron January 1981 and on equipment from the time of negotiations (June 1981). *Base costs are calculated accordingly. Price Increase - annual rate in %: 1981 1982 1983 1 F L F L F Construction and furniture 25 9 20 8 15 7 Equipment 12 12 10 10 8 8 Exchange Rate US$ = 23.5 Pesos - 41 - ANNEX 7 UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT Implementation Schedule CY 1980 1981 1 1982 1983 1984 Activities T III I II I I I\ I II III IV I II III IV I II All Institutions Institutions Requiring furni- ture and Equipment only __ Institutions in Phase A un. Institutions in Phase B Institutions in Phase C Support Centers Civil Works: Site Acquisition _ _ e _ _ Preparation of Plans and Bidding Documents Advertising and Tendering u ii _1A111 Construction X z X *g _ va _ liii! Equipment and Furniture: Completion of Lists and _ Specifications 11 111111 Completion of Bidding r Documents 'U' i Advertising of Tenders and Issuing of Bidding iln Documents Analysis of Bids and Contract Awards 'I Manufacturing and Delivery Installai. i c r_ - 42 - ANNEX 8 Page 1 of 2 UNITED MEXICAN STATES A TECHNICAL TRAINING PROJECT Related Documents and Data Available in the Project File A. Reports and Studies Relating to Educatian Descripci6n del sistema educativo nacional, Secretarla de Educacion Publica, octubre 1980. Plan global de desarrollo 1980-1982, Secretar
Groupe de la Banque mondiale · Staff Appraisal Report
Mexico - Technical Training Project
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