Tanzania - Poverty Reduction Support Credit (PRSC) Project

ISDS THE WORLD BANK GROUP AWorld Frfe 01 lro1Vtort H z- -=- -=- -- InfoShop Report No AC11 Integrated Safeguards Data Sheet (Updated) Date ISDS Prepared/Updated: 04/02/2003 Section I - Basic Information A. Basic Project Data Country: TANZANIA Project ID P074072 Project TZ PRSCI Task Team Leader: Benno J Ndulu Authlorized to Appraise Date: February 13, 2003 IBRD Amount ($in). Bank Approval. May 27, 2003 IDA Amount ($m) 100 00 IDA GRANT FOR DEBT VULNERABLE 32 Managing Unit: AFTP2 Sector General public administration sector (100%) Lending Instrument: Poverty Reduction Support Credit Theme: Other finanicial and private sector (PRC) development (P) Status. Lending I.A.2. Project Objectives This Poverty Reduction Support Grant (US$ 32 0 millioni equivalenit) and Credit (US$ 100.0 millioni equivalent) (PRSCI) provides a single-tranche facility to the United Republic of Tanzania in the total amount of US$132 million equivalent to support the implementation of the Tanzaniia PRS, as set out in the Poverty Reduction Strategy Paper (PRSP) and subsequent updates in the first and second PRS progress reports. The PRSC for Tanzania will deepen the reforn agenda supported by the Programmatic Structural Adjustment Credit I and include new areas of activity mainly aimed at scaling up growth and broadening its impact onl poverty reduction, and a sharper focus on achieving results from public spending Continuity and deepening of the PSAC agenda will include furtlher improvemenits in the business environmenit, including for the rural economy, enhanicilg public service delivery by focusilng on effectiveness and quality of public service delivery; and a focus on expenditure tracking to leverage onigoling efforts to improve the public financial management and accountability 1 A.3 Project Description: The proposed Credit and Graiit operation of US$132 million is a Poverty Reduction Support Credit (PRSC) that would build on recent reforms undertaken by the United Republic of Tanzania and support the implementation of Tanzania's Poverty Reduction Strategy (PRS) as summarized in the Poverty Reduction Strategy Paper (PRSP) and subsequent updates undertakeni with aninual progress reports. The first PRSC would focus Onl private sector development and public sector management to complete and deepen the reform agenda defined under the Programmatic Structural Adjustment Credit (PSAC) arid lay  2 ISDS the ground for attacking income poverty more aggressively. It is envisaged that there will be at least two further single-traniche PRSCs (each LIp to US$ 150 million equivalent) in FY04 and FY05 The credit/grant will support the implementation of Tanzania's Poverty Reduction Strategy by. (i) Accelerating growth: After nearly a decade of macro stabilization, structural reform and liberalization, the rate of growth of the Tanzanian economy remains low relative to the requirements for effective poverty reduction and the achievemilent of the Millenniulim Development GoalsA key target therefore is to raise growth to between 6 and 7 percent in the medium term by promoting higher private investment, reducing the cost of doing business, and enilanicinig the efficiency of the Tanzanian economy. (ii) Broadening the impact of growth About half of Tanzania's output derives from the rural economy and more thanl 70 percent of its population depends on it for its livelihood. Most of the GoT reforms to date have had a stronger impact in the urban and service sectors. Hence the program of PRSCs will support efforts to spread the impact of both reformis and resultant growthi to the rural income poor througlr * Enhancemilent of the profitability of agriculture broadly and export products of rural origin in particular, through better quality, higher productivity, reduced marketing cost and improved access to markets. * Removal of remaining institutional constraints on rural activities, and * Correcting the disincentives arising from the overall tax regime, specially those resulting from the overbearing/multiplicity of local taxes affecting income earinig activities in rural areas. (iii) Aligning public investment with PRS goalk addition to contilued efforts at improving the private investment climate, there is now a need to bring the development budget of the GoT in line with the strategic public investmienit requirements to meet the PRS targets and support the growthi of private sector contributioll to the economy and livelihoods. (iv) Increasing efficiency of public service delivery: Building on processes that have been put in place to enhance the strategic allocation and impact of public resources for poverty reductioll, increase the efficiency of public resource use through measures to furthier strengtheni accountability mechaniisms combined with capacity building at the local and central governimient level l.A.4. Project Location: (Geographic location, inforiliationi about the key environimenital and social characteristics of the area and population likely to be affected, and proximity to any protected areas, or sites or critical natural habitats, or any other culturally or socially sensitive areas.) The macro and governanice programs are coulitrywide. B. Clheck Environiental Classifi-cation: C (Not Required) Comments There are no potential large scale, signilficanit and/or irreversible impacts directly related to the operation PRSC I is a macro economic and budget reforn program. Environmenltal as well as social issues may arise from specific project activities in several sectors that are considered beyond the scope of this specific operation Many of these activities are part of parallel Bank sponsored programs, as well as other donor supported initiatives, and there will be assurances made that provisions are in place for addressing any significant environimiental arid social issues in accordance with Bank safeguard policies. A permanenit environimenital specialist has recently been assigned to the COultlry office in Dar es Salaam assuring  3 ISDS appropriate safeguard adherence by the Bank Althoughl the original PRSP contained limited discussionis regarding environiment and poverty linkages, subsequent forums and documlienlts have progressively expanded upOnI these issues A report by the Vice Presidents office in 2001 higilighited the key Issues in integrating environment into the PRSP process The PRSP progress report Issued in August 2001 added discussions about environimiental cross CUttilng issues. More recently (July 2002), GOT in collaboration with UNDP organized a workshop for the formulation of a program on the integrationi of environment into the PRSP process Another signilficant initiative is the synergy among GOT, UNDP and DFID in sponsoring an international environmental poverty expert to wvork in the poverty reduction program for a 3 year period beginninig in late 2002 Mainstreamiiing of environment into the PRSC process will be carried out by the Tanzania Vice-President's Office (VPO) with the support of UNDP, the Bank, the donor community and other stakeholder groups. This builds on the substanitial grounlidwork on the institutionial framework already done. It is envisaged that the PRSC process will operationalize highi priority activities already identified by the GOT for mainstreaminiig environmenit into the PRS beginning with PRSC2. These include: increasing the knowledge base on poverty - enviro-nmenit linkages and evaluationi of the impact of PRS interventionis on the environment and poverty and government performance in meeting PRS targets. The goal of the latter activity is to strengthen the existing Poverty Monitorinig System through linking it with environimiental informilatioln systerns supported under the PRSC process. The key actions that will be carried out under the PRSC I and 2 cycle would include (a) Development of targets which are consistenit xvith sectoral aiid district plans and identify and agree on timelinies and threslholds which will be used to evaluate PRS implemenitation, and (b) Agreement on the action plan for development of an effective institutional framework for the integration and management of the poverty-environiment indicators in the existing Poverty Monitoring System. C. Safeguard Policies Triggered Policy Applicability Environmental Assessment (OP/BP/GP 4.01) 0 Yes * No C TBD Natural Habitats (OP/BP/GP 4.04) tC Yes * No C; TBD Forestry (OP/GP 4 36) C Yes * No O' TBD Pest Management (OP 4.09) ' Yes * No C, TBD Cultural Property (OPN 11 03) ID Yes * No I TBD Indigenious Peoples (OD 4.20) C Yes * No C TBD Involuntary Resettlement (OP/BP 4.12) 0 Yes * No ' TBD Safety of Dams (OP/BP 4 37) G Yes *No D TBD Projects in Interniationial Watervays (OP/BP/GP 7 50) 0 Yes * No C TBD Projects in Disputed Areas (OP/BP/GP 7.60)* C Yes * No 0 TBD *By supporting the proposed project, the Bank does not intend to prejuidice thefinal deternnination of the parties' claimis on the dispzuted areas Section 11 - Key Safeguard Issues and Their Management D. Sumnmary of Key Safegutard- Issues. Please fill in all relevant questions. If information is not available, describe steps to be taken to obtain necessary data II D Ia Describe any safeguard issues and impacts associated with the proposed project Identify and describe any potential large scale, significanit and/or irreversible impacts The followving environmenltal issues are flagged at this stage to be addressed in future PRSC operations  4 ISDS * Actions for improvimg the business environmenit should take into account issues relating to environmenital risk and liability. These issues may be addressed in specific sectors such as miniing, agriculture, roads, or water. The PRSC can liaise withi relevant sectors to ensure that proper monitorinig is carried out * Actions for improving the business environmenit also target legal reforms on property rights In enforcement of property rights, due regard should be given to existing uses of land and righits of communIities to earn a livelihood. * A GOT process to decentralize public sector management and administration to the District level posses enormous challenges for effective environmiental managemenit Assessmenit of provisions and procedures that ensure adequate EA need to be documented T1.D. Ib. Describe any potential cumulative impacts due to application of more than one safeguard policy or due to multiple project componenit. None II.D. Ic Describe any potential long term impacts due to anticipated future activities in the project area. None 11 D.2 In light of 1, describe the proposed treatmenit of alternatives (if required) Not applicable Il.D 3 Describe arrangemenit for the borrower to address safeguard issues Although PRSCI has no potential large scale, significant, and/or irreversible impacts directly related to this operation, strengthieniing Tanizanila's institutionial capacity to carry out environmental assessments will be an objective during PRSCI implemenitationi to ensure that appropriate mechanisms are in place that will allow future PRSCs to address sectoral issues. Fulidiig for such activities is provided through a PHIRD grant as well as support from other donors such as UNDP in addition to government's own resources. Specific use of Strategic Environmental Assessments (SEA) will be made for sectors included In future PRSCs A continuilng program by the donor commun1ity Is supporting environmental management and regulation at the central government level as well as at several key sectors The National Environmenit Managemenit CouLIcil and the Department of Environimienit have been attempting to harmonize their respective roles and responsibilities. Environimilenital legislation is pendinig approval. ETA capacity bulilding Is supported through government, paristatal, NGO and donor involvement II.D 4 Identify the key stakeholders and describe the mechaniisms for consultationi and disclosure on safeguard policies, with an emphasis on potentially affected people. The poverty reduction program of GOT is an inclusive stakeholder consultative process and will continue to be so throughout the PRSC programming. E. Safegumards Classification Category is determined by the highest impact in any policy. Or on basis of cumulative impacts from multiple safeguards Whenever an individual safeguard policy is triggered the provisions of that policy apply Si. - Significant, cumulative and/or irreversible impacts; or significant techniical and institutionial risks in managemenlt of one or more safeguard areas [ ] S2. - One or more safeguard policies are triggered, but effects are limited in their impact and are technically and institutionally manageable  5 ISDS [X] S3. -No safeguard Issues [ ] SF. - Fianicial intermediary projects, social development funds, community driven developmenit or similar projects whichi require a safeguard framework or programmatic approach to address safeguard issues  6 ISDS F. Disclosiure Requirements Environmental Assessment/Analysis/Mancagem?ient Plan. Expected Actual Date of receipt by the Bank Not Applicable Not Applicable Date of "in-country" disclosure Not Applicable Not Applicable Date of submission to InfoSlhop Not Applicable Not Applicable Date of distributing the Exec. Summary of the EA to the ED Not Applicable Not Applicable (For category A projects) Resettlement Action Plan/Franiework Expected Actual Date of receipt by the Bank Not Applicable Not Applicable Date of "in-country" disclosure Not Applicable Not Applicable Date of submission to InfoShop Not Applicable Not Applicable Indigenous Peoples Development Plan/Framnework: Expected Actual Date of receipt by the Bank Not Applicable Not Applicable Date of "in-country" disclosure Not Applicable Not Applicable Date of submission to InfoSlhop Not Applicable Not Applicable Pest Managenment Plan. Expected Actual Date of receipt by the Bank Not Applicable Not Applicable Date of "in-country" disclosure Not Applicable Not Applicable Date of submission to InfoSlhop Not Applicable Not Applicable Dam Safety Management Plan: Expected Actual Date of receipt by the Bank Not Applicable Not Applicable Date of "in-country" disclosure Not Applicable Not Applicable Date of submission to lnfoShlop Not Applicable Not Applicable If in-country disclosure of any of the above documents is not expected, please explain why Signed and submitted by Name Date Task Team Leader: Benno J. Ndulu 03/06/2003 Project Safeguards Specialists I Kennetlh M. Green/Personi/World Bank Project Safeguards Specialists 2: Indumathie V. Hewawasamil/Persoin/World Bank Project Safeguards Specialists 3: Approved by: Name Date Regional Safeguards Coordinator: Charlotte S. Binghanm 03/20/2003 Sector Manager/Director: Frederick Kilby 03/20/2003 For a list of World Bank news releases on projects and reports, click here E A Rr , FEE84C..( | E MAP ------- I