Uganda - First Health Project

Docunent of The World Bank FOR OFFICIAL USE ONLY &C/a /43q-t%JfiC Report No. P-4823-UG MEMORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT OF SDR 38.0 MILLION TO UGANDA FOR A FIRST HEALTH PROJECT June 24, 1988 Population and Human Resources Division Eastern Africa Department 2 Thbis document bas a restricted distibution and may be used by rcipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  t'RRy EQUVALWS Currency Unit: - Uganda Shillings (Ush) US$1.00 = 60.00 USh SDR1.00 1US0.721 NRIC MM IVALMWS Metric System AEBRBIAfLONS AIDS Acquired Immune Deficiency Syndrome MCH Maternal and Child Health MOH Ministry of Health MHLG Ministry of Local Government NGO Non-Government Organization SIDA Swedish International Development Agency GOVENRNM OF UGANDA FISCAL ER July 1 - June 30 At April 30. 1988  FOR OFFICIUL USE ONLY UGANDA FIRST HEALTH PROJECT CREDIT AND PROJECT SUMMARY Borrower: Uganda Beneficiary: Ministry of Health Amount: SDR 38.0 million (US$52.5 million equivalent) Terms: Standard, with 40 years maturity Onlenidin Terms: Not Applicable i!ancinP: Plan: Government - US$6.5 million IDA - US$52.5 million SIDA - Us$6.5 million Total: - U million Economic Rate of Return! Not Applicable Staff Appraisal Report: No. 7203-UG Mapt IBRD No. 20861 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 discksed without World Bank autho. '.Ati.,  MEMORANDUM AND RECaMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO UGANDA FOR A FIRST HEALTH PROJECT 1. The following memorandum and recommendation on a proposed development credit to Uganda for SDR 38.0 million (US$52.5 million equivalent) is submitted for approval. The proposed credit would be on standard IDA ternms with 40 years maturity and help finance a first health project. The project would be cofinanced by SIDA (Sweden) for US$6.5 million. 2. Background. The political tu-zmoil and civil strife of the past two decades in Uganda resulted in the almost total collapse of the public sector health services. Facilities have been destroyed and looted and equipment stolen. Staff have remained unpaid for long periods and drug supplies are intermittent. Furthermore, the organization and management of the health sector is weak with lack of clarity in the respective roles and responsibilities of the Ministry of Health (MOH) and the Ministry of Local Government (MLG). Funding of the health sector is inadequate with a decline from estimated expenditures of US$128 million in 1982 to less than US$70 million in 1986. As a result, the health status of Ugandans has deteriorated dramatically: immunization programs now reach only 15-25Z of the population against up to 70 in 1971; there is a resurgence of diseases such as measles and malaria; and there is a growing AIDS epidemic. Host Maternal and Child Health (MCH) programs have been abandoned. The level of mortality in Uganda has become significantly higher than in other major East African countries. This situation needs to be redressed and urgently. 3. With the return of peace to much of the country since 1986, there are fortunately a number of elements of hope upon which it will be possible to build a revitalization strategy for the sector. First of all, non- government organizations (NGOs) and private practitioners, though subject to the same difficult environment as the public sector, have been able to restore a reasonable provision of services in the areas where they are located. Second, a number of community level initiatives are being initiated to effect minimum maintenance and repairs to health facilities. Third, Government has provided for the managerial and financial autonomy of the country's main public hospital. Finally, the Health Policy Review set up by Government in 1986 has just issued its recommendations, which would help put the sector on a sound administrative and financial path. The proposed strategy, to be supported by this project, would be to initiate actions necessary to deal with both immediate problems and longer term challenges. To address the immediate needs of the health sector, urgent action is required to provide drugs, equipment, restore health education programs, and reconstruct damaged health facilities. At the same time, and to achieve a permanent impact, these efforts need to be complemented by measures addressed to the longer term and more fundamental issues of health sector planning and programming, financing, manpower development, and management strengthening.  4. Proiect Objectives. The project has three major objectivess (a) reestablish the provision of health services by physically rehabilitating a number of strategically located hospitals and health centers; (b) promote the population's health status by strengthening preventive health programs; and (c) ensure the long-term sustainability and viability of the health care delivery system. 5. Prolect Description: The proposed project has therefore three major components: (a) essential rehabilitation of Mulago Hospital, eight district hospitals, thirty rural health centers, and the central blood transfusion center, and building of a new hospital in Rakai District (particularly affected by AIDS); (b) a health and hygiene education program using a wide variety of media; a community based distribution program for drugs and supplies; and a program for counselling and managing AIDS patients and their families; and ic) the strengthening of planning and management capabilities In MOH and the hospitals; a study of alternative schemes for financing the health sector; and support to NGOs. 6. Rationale for IDA Involvements IDA has been concerned with the health sector since the early 1980s, initially through a sector report and thereafter through a series of studies financed under a technical assistance project (Credit 1434-UG) which have formed the basis for the current project. The reestablishment of a viable health sector is part of IDA's overall strategy in support of the country's economic recovery. IDA's financial support for the health sector would therefore be intended to generate a momentum towards revitalization of essential programs, institutions, and staff morale within the context of a feasible health development plan, as well as preventing and controllin, the spread of AIDS. It would also aim at attracting coordinated support from bilateral and multilateral agencies. This project is intended to be the first in a series of projects to the health sector. 7. Atreed Actions: During negotiations Government agreed that it would: (a) by credit effectiveness: (i) appoint a qualified and experienced project coordinator; and (ii) prepare an acceptable timetable for finalization of civil works documentation. (b) by December 1, 1988: submit to the Association evidence that it has secured from other donors the equivalent of not less than $6.5 million for the financing of the project. To ensure the sustainability of the project-supported investments, Government would also: (a) by June 1989, prepare a staffing plan for each facility under the project, including proposals to deal with redundant staff; (b) by December 1989, prepare a staffing plan for each of the project-financed workshops; and establish Management Committees for each facility under the project; (c) introdu- :ternate schemes of health financing including cost recovery at facilities rehabilitated under the project; and  -3- (d) by December 31, 1990, carry out a comprehensive mid-term review of progress made in the implementation of the project. The review would focus inter alia on (i) overall financing of the health sector, including recurrent costs, to ensure that adequate funds are made available to sustain health services and' (ii) financial plans of project-financed facilities, with details on alternative schemes for the generation of resources (including cost recovery) to ensure that such schemes are properly established and appropriately implemented. To ensure the sustainability of the health system as a whole, Government has also agreed to: (a) by December 1988, prepare a timetable of actions to improve organization of the health system; and complete the National Health Plan; (b) by December 1989, prepare a proposal and implementation plan to improve the hospital referral system; and (c) by December 1989, prepare a staffing plan for the health sector as a whole. Other covenants are: i?) appointing, by December 31, 1988 a health education coordination committee; (b) providing IDA with the results of studies within six months of their completion; (c) by June 30, 1989 allowing funds generated through community and health-related financing activities, including cost recovery on drugs, to be rechannelled to the respective health facility; and (d) obtaining IDA's agreement to proposals for income generating activities, NGO activities, and related accounting mechanisms prior to their implementation. Disbursement conditions are (a) for funds relating to the construction of a hospital in Rakai district, selection of an acceptable site, and (b) for the hygiene education sub- component, completion of detailed preparation. 8. Benefits: The proposed project would improve the effectiveness and efficiency of the health system by (a) rebuilding health personnel morale and beneficiary trust in its services through rehabilitation of facilities and the provision of essential equipment and supplies; (b) strengthening a number of key preventive health programs; and (c) addressing planning, managerial and financial issues. Several of these interventions at the hospital/health center level and at the community level would help slow down the spreading of HIV infection. 9. Risks. The project faces three main risks. The first relates to the implementation capacity of the MOH which is understaffed and organizationally and managerially weak. The project therefore provides systematic support to the MOH and structures the implementation program so as to avoid overextending the MOH staff. The second risk relates to the feasibility of developing additional methods of financing the health sector. The establishment of hospital and health centers management boards, the launching of local self-help programs to maintain and expand facilities, and the emergence of the Resistance Committees as strong community forces should alleviate this risk. The third risk concerns low  -4- staff motivation due to low levels of pay and poor working conditions. The introduction of new management systems and practices, the rehabilitation of facilities and the increased community involvement should reduce this risk considerably. 10. Recommendation: I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and recommend that the Executive Directors approve the proposed credit and that the Association administer the SIDA grant. Barber B. Conable President Attachments Washington, D.C. June 24, 1988  -5- SCHEDULE A UGANDA FIRST HEALTH PROJECT Estimated Costs Local Forei*n Total US$ million A. Rehabilitation and Construction of Health Facilities 8.9 28.1 37.0 B. Health Education and Community Activities 2.1 8.1 10.2 C. Strengthening Health Care Delivery 1.1 2.4 3.5 Total Base Cost 12.; 38.6 50.7 Total Contingencies 8.4 6.4 14.8 Total P;oject Cost 20.5 45.0 65.5 Financing Plan Government 6.5 -- 6.5 IDA 9.0 43.5 52.5 SIDA 5.0 1.5 6.5 Total 20.5 45.0 65.5  -6- SCHEDULE B Page 1 of 2 UGANDA FIRST HEALTH PROJECT Procurement Method and Disbursements (US$ million) Procurement Method Total ICB LCB Other N.A. Cost Civil Works 22.4 2.5 24.9 (20.2) (2.3) (22.5) Vehicles 0.5 0.5 ( 0.5) ( 0.5) Furniture 2.5 0.2 2.7 ( 2.5) (0.2) ( 2.7) Materials/Supplies 0.7 0.1 2.6 3.4 ( 0.7) (0.1) (2.6) ( 3.4) Equipment 12.3 0.3 12.6 (12.3) (0.3) (12.6) Technical 3.5 3.5 Assistance (3.5) ( 3.5) Monitoring, Research, 2.9 2.9 Evaluation and (2.7) ( 2.7) Mass Media Local Training 1.2 1.2 (0.6) ( 0.6) Overseas Training 0.3 0.3 (0.3) (0-3) Utilities 0.7 0.7 (0.5) (0.5) Materials/Supplies 8.0 8.0 (6.5) (6.5) Fuel, Oil, Lubricants 0.4 0.4 (0.3) (0.3) All maintenance costs 4.4 4.4 (2.9) (2.9) TOTAL 38.4 3.1 24.0 65.5 (36.2) (2.9) (19.9) (59.0)1/ 1/ Includes SIDA contribution of US$6.5 million.  -7- SCHEDULE B Page ;' of 2 Disbursements Catetory Amount x USS Million 1. Civil Works 22.5 100% of foreign expenditures - and 90% of local expenditures 2. Equipment, vehicles 17.8 100% of foreign expenditures materials and supplies and 90% of local expenditures 3. Consultant services 3.5 100% of foreign expenditures and 90% of local expenditures 4. Training 1.4 100% of total expenditures 5. NGO Support 1.1 100% of foreign expenditures and 90% of local expenditures 6. PPF .6 7. Unallocated 5.6 TOTAL CREDIT AMOUNT 52.5 Estimated Credit Disbursements (US$ million) IDA Fiscal Year FY89 FY90 FY91 FY92 FY93 FY94 FY95 Annual 13.1 14.1 11.2 8.0 1.7 2.0 2.4 Cumulative 13.1 27.2 38.4 46.4 48.1 50.1 52.5  -8- SCHEDULE C Page 1 of 1 UGANDA FIRST HEALTH PROJECT Timetable of Key Proiect Processin Events (a) Time taken to prepare: 5 months (b) Prepared by: Government with IDA assistance (c) First IDA mission: November 1987 (d) Appraisal mission departure: January 1988 (e) Planned date of effectiveness: September 1988 (f) List of relevant PCRs and PPARs: None  -9- Schedule D Page 1 of 2 THE STATUS OF RANK CROUP OPERATIONS IN UGANDA A. STATEMENT OF RANK LOANS AND IDA CREDITS (as of March 30. 1988) - -USS Mlllion-- Amount (Lse. Cancellatlons) Loan or Undis- Credit No Year Borrower Purpose Bank IDA bursed One (1) loan and fourteen (14) credits fully disbursed 8.40 283.43 1249-Uc 1982 Uganda Industrial Rehabilitation 35.00 12.21 1328-UC 1983 Uganda Agricultural Rehabilitation 70.00 21.19 1329-UG 1983 Uganda Third Education 32.00 .19 1434-UG 1984 Uganda Second Technical Assist. 1S.00 6.32 144S-UG 1934 Uganda Third Highway S8.00 42.12 lS10-UC 1985 Uganda Water Supply and Sanitation Program 28.00 8.5s 1s39-G 1985 Uganda Agricultural Dovelopment 10.00 8.31 se0o-uG 1985 Uganda Second Power 28.80 26.66 1se5-ua 1986 Uganda Petroleum Exploration Promotion 5.10 4.74 1803-8G 1987 Uganda Fourth Highway 18.13 18.18 1824-uc 1988 Uganda Foroutry Rehabilitation 12.87 12.36 08340-8 1986 Uganda Non-Sector Specific (Econ. Recov. Cr/SAF) 24.01 11.28 1844-4G 1988 Uganda Non-Sector Specific (Econ. Recov. Cr./SAF) 65.00 43.89 1869-U 1988 Uganda South West AS 3ehab. 10.43 10.48 189s-G 1986 Uganda Sugar Rehab. 25.96 25.96 Tot.l 8.40 721.73 252.34 of which has been repaid 6.8b 4.45 Total now outstanding 1.62 117.28 IDA amount sold: 17.50 of which has been repaid 17.50 TOTAL NOW HELD BY ANK AND IDA 1.S2 717.28 TOTAL UNDIS8URSED 0.00 252.34  - 10 - UGANDA Schedule 0 Page 2 to 2 B. STATEMENT OF !FC INVESTMENTS March 30, 1988 Amount in US$ million Flscal Oblipor Type of Business Loan Equity Total 1968 Mulco Textiles, Ltd. Textiles 2.79 .71 3.50 1972 Tourism Promotions Services Tourism 1.11 - 1.11 1983 Toro and Mityans Tea Food and Co., Ltd. (TAMTECO) Food Processing 1.62 - 1.82 1983 Sugar Corp. of Uganda Food and Food Processing 8a09 - 8.00 1984 Uganda Tes Corp. Ltd. Food and Food Processing 2.81 - 2.81 1984 Development Finance Development Finance - 0.38 0.38 Company of Uganda - - Total gross commitments 18.34 1.09 17.42 now held by IFC total undisbursed (including 3.92 0.27 4.19 participants portion) = Source: IFC Disbursements Section  tBRD 208 U G A N D A 0t 32- 330 A UGANDA HEALTH PROJECT s U D A N 4 . Hosp4tal Rehabilitation and Construdion _ ./ - * Roa Disbict Hospital Koab> . O Odw District Hospitals / C MOYG KIT"U A , Moajrt Roa&dsr -- Riilroads 3. ~ zRivwsKOI3 * District Capitals - - District Boundaries _____ti_n _ B_2O oe A oisiV MOROTO r o 2' 0 20 40 60 MILES ORY -2r 2 >A- i.zIR 1trt HOIM/ T A NK) Z A N I A N AKHA K r o. @ RWANDA 5td 31- t }DJ 32 33- (Z|Xw \; A i -1. 0~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ -O 0as0.0 IOA~~~~~TIOI KA/NY MBARAI1A I F 0. I~~~~~~~~~~~~~~~~~~~~~ AR \KAa