Barbados - Human Resources Project

Doct of The World Bank FOR OFFCIAL USE ONLY VAVW No. P-5921-BAR MEMORNDMS AD ATIOON OF THE PRESIDENT OF THE INTENATIONAL BANK FOR SAD P TO THE EECUTJIVE DIRECTORS ON A PROPOSED LOAN IN M AMOUNT EQUIVALENT TO US$7.8 KILLION TO BARBADOS FOR A EDAN RESOURCES PROJECT JUNE 4, 1993 MICROFICHE COPY Report No.:P- 5921 BAR Type: (PM) Title: HUMAN RESOURCES PROJECT Author: SCHNEIDMAN, M. Ext.:39391 Room:I 5177 Dept.:LA3HR This documet has a restricted distibution an any be wsed by recipients only In the performance of tbeir official duties. its contents may not otherwise be disclosed without World Bank aothoriation.  CURRENCY EQUIVALENTS Curnency Unit = Barbados Dollar (BDS$) US$1.00 = BDS$2.00 (Appraisal Rate) FISCAL YEAR April 1 - March 31 ABBREVITIONS AND ACRONYM BAS Business Advisory Service BCC Barbados Community College BNB Barbados National Bank BSSEE Barbados Secondary School Entrance Exam CAICOM Caribbean Community CDB Caribbean Development Bank CE? Common Exteral Tariff EPIU Educao Prect Implemenion Unit ETF Employment and Trmining Fund GOB Government of Barbados MOEn of Education NE National Employment Bureau NTB National Trining Board PEP Public Ependiture Program PPG Public and PubLicly Guaranteed SAL Scbr Adjustment Loan SJPP Samuel Jackman Pecod Polytechnic TVET Technical and Vocadonal Education and Training VAT Vale Added TIx  FOR OMCIL USE ONLY BARADOS HUMAN RESOURCES PROJECT LOA AN<D PEROJECT SUMARY Borrower Barbados Amount US$ 7.8 milion Tem 15 years including a five-year grace period, at the standaid EBRD variable inteest rate. Finanrng Plan Lcal Freign ItaI ........ uS $ Million. Government 7.8 0.0 7.8 IBRD 0.9 J. _U Total 8.7 6.9 15.6 Rate of Return Not Applicable Poverty Category Program of lTrgeted Interntions Staff Appraal Report 11319 - BAR Map BRD 24710 This document has a restricted distribution and may be used by recipients only in the perfornance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  MEMORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPME0NT TO THE EXECUTIVE DIRECTORS ON A PROPOSiD LOAN TO BARBADOS FOR A HUMAN RESOURCES PRO,ECT 1. I submit for your approval the following memorandum and recommendation on a proposed loan to Barbados for the equivalent of US$7.8 million to help finance a Human Resources Project. The loan would be at the Bank's standard variable interest rate for a term of 15 years, including a grace period of five years. PART I. COUNTRY POLICIES AND THE BANK GROUPPS ASSISTANCE STRATEGY A. Economic Policies and Performance Backgound 2. Despite its small size - a populaton of 255,000 and an area of 431 square km.- and a wrlaively nanrow esource base, Barbados established an impressive record of economic and social development since it gained independence from Great Britain in 1966. GNP per capita reached US$6,630 in 1991, the highest among the World Banks active bonowers. Associated with this income growth was a steady and signifct improvement in the distution of income and socia welfare - in educational attainment, housing, and health and nutrition standards; the establishment of a solid social and economic institutional framework and diversification of the country's economic base, from a monoculture exporting sugar, to a services oriented economy based on tourism and busins services. A graduation program was initiated in 1984 which involved a seven-year phase-out period (PY85-91) to be supported by a Bank lending program of around US$9 million per year in new com Ients, ttlling US$63 million over the period. 3. As part of the grduation process, an economic mission visited Barbados at the end of 1990 to report on the state of progress (Barbados: Requirements for Sustained Development, Report No. 9545-BAR). The mission reviewed Babados' development eperience since 1966 and confirmed the country's achievements in tenns of economic and social development, insuional capacity and access to capital markets. However, the mission also found that the economy's dynamism had begun to erode during the 1980s and, that as of end 1990, the economy was registering domestic and external imbalnces of crisis proportions which called for urgent stabiliation. 4. The origin of Barbados' economic difficulties can be traced back to the early to mid 1980s when its external competitiveness began to weaken. Domestic cost factors, stemming from expansionary demand management policies and reinforced by wage pressures, contrbuted to a real exchange rate (RER) appreciation over the 1980s. Moreover, trade and tax policies,  -2- through a complex set of incentives and of government interventions, promoted the development of an inefficient import-substituting sector. Efforts to rise revenues often entailed "quick tax fixes" which compounded the tax system's anti-export bias and made it difficult to administer. By 1986, private investment had begun to decine and manufacturing output had tapered off, while the sugar industry continued its secular decline, draining an increasing volume of finarrial resources from the economy. Moreover, employment growth was unable to absorb newv labor force entants or displaced workers, so that unemployment rose to 15.5% of the labor force by 1989 from about 11% in 1980. Only tourism, aided by the weakening of the US$ vis-k-vis European currencies, continued to prosper. But even here, wealmesses in the industry began to emerge as a consequence of a mismatch between the quality and price of the product offered. 5. By early 1991, the key macroeconomic perfomae indicators - the fiscal deficit, foreign exchange availability, and Central Bank credit to the public sector - had reached unsustainable levels. Nevertheless, the country continued to maintain price stability. The budget presented to Parliament on April 2, 1991 introduced rmvenue measures to reduce the fiscal deficit and included a commitment to implement complementay expendime reducdon meaures to rstore domestic and extenal ba . In September 1991, following discussions with the IMP, the Government introduced a supplementary budget aimed at stabiizhpg the economy, and in February 1992 it entered into a 16 month IM Stand-by Arrangement, supplemented by a purchase from the Compensatory Contingency Fund Facilty (CCF. Stabilization Effots and Outcome 6. The objective of the stabilization program was to regain finncial stabilit wile prepaig stractur.1 reforms to improve conditions for economic growth. In order to maintain the long- snding wexhange rate pariy (Barbados has maiained an exchange rate of BD$2:US$1 since 1975), the adjustment effort centred on a shap improvement in the public finances, and on the pursuit of tight monetary and incomes policies. Specifically, the program aimed at: (i) elimiang the overal fiscd deficit in FY92J93 through a combinatio of ewenitue reduction and re'enue enhancing measures, including lowering the wage bil through an across the board 8% cut in public sector wages and the release of 3800 works ( ng close to 10% of public sector employment) in FY91192 followed by a wage freeze; (ii) implementing a restictive monetary policy and replacing instruments of direct control with a more market-oriented apach; and (ii) ino ng an incomes pohcy which, in addition to the public sector wage cut and subsequet freeze, eailed "wage guideines'" for the private sector caling for a two- year wage free of all contcts, with allowacs for produciity bonuses and profit-sharig arrangements. Structural refoms initiated under the Stand-by included Padiament appwval of a t tax reform, preparain of an indirect tax reform proposal, divestment of tre public enterprises, and restuctrg of the Tourism Board, the sugar industry and the statowned Barbados National Bank NB).  -3- Table 1: KEY MACROECONOMIC INDICATORS, 1986.99 Actl Et. Prectd 198S-89 1990 1991 1992 1994 1997 1999 (avea) (Rased on Adopdion of CompreenveStutr AdjustmentlPrograOl/ Real ODP Growth Rate (%2 3.2 -33 -4.4 -3.7 2.0 3.5 3.5 Invsm t and Saving (% of GDP) Gros Domestic Invetment 16.7 18.7 16.8 14.0 17.6 16.2 16.2 GOs Domestic Saving 17.3 17.3 15.0 13.8 16.9 16.2 16.5 Public Finances (% of GDP)31 cnrl GOv. Ovea Balance -3.8 -7.4 40.7 03 0.3 0.5 1.0 Consldated Public Sector -4.7 -8.3 -1.2 -1.0 .0.5 0.0 0.5 Ovea Balance Dalna. of Payset CurrentAccountGDP4/ -0.3 -2.3 -2.1 .0.8 .0.8 0.3 1.0 For'ipnlE=angeavae 2.3 1.0 2.0 2.4 3.4 3.5 3.5 asm olm of lnos 3t & SI Total DtIGDP 40.8 40.0 38.6 39.3 43.9 38.S 32.5 Total DebtE o (G) 69.7 76.7 77.9 79.1 71.8 60.8 50.7 Toa Debt SevkceBzpIut (10) 10.2 15.8 16.7 14.7 11.0 10.9 7.4 3ORD Exposur MRD DebtP Debt 8.7 7.1 6.8 6.7 9.3 10.6 8.S MBRD Dft S*beMods (GOA) . 0.9 1.1 1.2 1.3 1.0 1.0 0.7 Ptfetred Creditor Debt SUviO/P Debt Srvlco 38.4 22.0 20.S 34.3 40.7 45.7 36.9 U hese proj we illustaive of a posiblo outme combining a ceain set of assumpions In a condsiency fmawo 21 GDP at fclor coat. 3t Ical yea; 1990 for amn fars to April 1, 1990 through Mrch 31,1991. 41 ncudes of c ltransf SJ Rdained Iors. Soures: Cea Bank of Barbados DdF ad Wodd Bank staff oemates and prections 7. The stabilization program was implemented decisively and rapid progress was achieved in resgt fiscal and e nal balance. The tightening of financial polcis, together with inceased pidvate capital inflows and divestment receipts, helped replensh Central Bank gross liquid I national reserves to about two months' import equivalent by end FY92. However, a number of the structural measu and instituonal refoms contained in the program e erienced delays, including the divestment of the argeted public enteipriSs, and the restructgrn of the suar industry, the Tourism Board and the MND.  -4- 8. Meanwbile, the economic recession has continued to deepen because of weak tourism activity and domestic tightening of demand management policies. The decline in real GDP which bean in 1990 continued through 1992, when a decrease of 4% is estimated. This represents a cumulative drop in output of about 12% over the last tbree years. All major sectors (except for non-sugar agriculure and busins services) have continued to record negative growth. Unemployment has continued to rise to about 25% of the labor force by end 1992. 9. Three purchases (totalling SDR 14.7 million) were made under the Stand-by aniangement in 1992. Subsequent purchases have been delayed pending progress on structural measures and agreement with the Govenmment on its medium-tenn policy agenda, in particular its incomes policy, All quanftitve performance targets were, however, observed through March 1993. In its 1993/94 budget, presented in March 1993, the Government reversed the 8% two-year salazy cut of the public sector, but announced a two-year global wage freeze throughcut the economy. An IMF Article IV mission visited Barbados in mid-MAy. The Esteral Environment 10. Barbados' economy depends heavily on the export of tourism and interational business and financial services, and to a much lesser extent on sugar and other manufacrs. Tourism's prorance is critical for Barbados' growth prospects. The sector curendy contributes dirctly 12% of GDP, over 20% of total employment, and 60% of export earnings. Barbados' sugar exports (4% of eipot earings) benefit from preferent market arrangements from the BC and US; however, due to poor sector peiformance, the OUntry bas not been able to meet its combined quota in both marles in recent years. Manufs (9% of eort earnings) have also fllen i recent years and are essentally geared towards the protected CARICOM market. In terms of imports, Barbados is not too vlnemrable to oil price changes since it produces half of its domestc oil consumption and all of its natural gas reqirements. 11. Barbados' oss of competitiveness in tourism during the 1980s was accompanied by increased competiton from other Caibbean desnations. Over the last few years, major competitrs, such as Jamaica, Tridad & Tobago and Guyana, have undertaken far reaching structual adjustment programs, which have improved their comparative advantage vis-k-vis Barbados, both for tourism and other exports. Other tourism destnations, such as the OECS cuntris, have also improved tourism infuctre and sevices, and are increasing their share of the Caribbean markeL As a reslt, while toursm contined to expand by 20% in Jamaica and 15% in the OECS during 1989-91, twrism arzivals inBarbados feliby a similrpewage. The prlonged recssion in North America and in many European countries has exaerbated this decline s 1990. Curent growth projections for indusalize co es imply that the demand for tourism in Barbados will emain sluggish and lag behind that of its competitors untl the country improves its competitive positio. 12. Exchange rate flutuatmons among major currencies have also had an impact on Barbados' tourism perfance. Barados attacts a considerably higher proportion of European tourists  -5- than many Caribbean countries. Close to 40% of all Barbados tourist arrivals originate in the U. K. and continental Europe, as compared to about 20% for the Caribbean as a whole. From the mid to late 1980s, Barbados benefitted from the slide of the US dollar vis-k-vis major European currencies. However, Barbados was negatively affected by the appreciation of the US dollar with respect to a number of European currcies which took place during the last quarter of 1992. While this situation was reversed in early 1993, if a significant appreciation of the US dolLar were to occur in the future, it would further reduce Barbados' regional competitiveness. 13. Barbados' external debt is manageable. In 1992 it amounted to US$656 million or 39% of GDP while its total medium and long term debt stood at 26% of GDP; the interest to GDP ratio was 3%. The total debt service ratio peaked at 17% in 1991, and bas declined since to about 15% in 1992, after Barbados redeemed two yen-denominated bond issues. The Bank's exposure is low; in 1992 the IBRD's share of Barbados' public and publicly guaranteed debt stood at 6.7% and its debt service repsented 1.3% of Barbados' exports of goods and serices. The recent financial improvements have enabled the country to improve its access to pnvate capital markets. It obtained a US$12 million commercial loan in February 1993, repayable over a 3 year period. outlook 14. The oudook for Barbados will depend on the direction of economic policies the Govemment chooses over the next few months. Short term prospects for a rapid tun-around are not promising. Toursm has only improved modestly m the recent winter season and connues to fice increasing competition from other Caribbean desaions. A major reform is required to improve the efficiency of the sugar industry; producton is now at a histoical low. Manufacturing prospects are bleak as the sector is inefficient and highly protected. It produces mostly for the limited CARICOM market, where Jamaica and Trinidad and Tobago have become the most efficient producers. Moreover, egulatory constraints and bureaucratic red tape have inhibited private investment Recent revenue enhancing measures have also compounded the already high domestic costs and excessive tax bue thmugh increases in taxes and import taiffs. The stabination efforts have also resltd in an excessive reduction in public and private investment 15. The Bank, the IMP and the IDB have been engaged for more than a year in discussonms regarding the adoption of a comprehensive structul adjustment program. The Government is cureny reviewing different policy options; however, no agreement has yet been reached with the multilaterals on the tbrust or on the pace of the program required. This decision will affect Barbados' prospects for a sustainable economic recovery. In the short term, there is lite room for enhancing growth through an increase in public expenditures. Such a course would increse the overall public sector deficit and renew foreign exchange presurm. Altematively, if such expendites were to be financed by income or indirect taxes, the incentives for private investment would be reduced and the economy's cost structure would be increased. Thus, strict stabilizaon policies need to continue. Another option would be to continue with the current  -6- stabilization efforts while slowly moving towards structural reform. The country could then arrest the present economic decline and possibly resume very modest growth rates over the next few years. Such a recovery path, however, would be excessively slow and insufficient to rapidly reduce the high unemployment levels. To achieve a rapid recovery and restore growth back to its historica. path, Batbados will need to adopt ? comprehensive structual adjustment program ained at improving its international competitiveness quickly. The key elements of such A program are descrbed below. The Development Agenda 16. To substantially improve its interational competitiveness and reverse the economic deteioration of the past three years, Barbados will need to implement a comprehensive sauctural adjustment program centering on: (i) the establisbment of a growth-oriented macroeconomic and incentive framework; (ii) public sector reform; (iii) improvements in argeting soal assistance to vulnerable groups; and (iv) reform of the sugar and financial sectors. 17. Maeroeconomic and Incenive Framework. The stbizaton progam has succeeded in improving the fiscal accounts and the Centml Bank's foreign exchange position. However, additional shuctal adjustment measures to rapidly reestablish its iaonal competitiveness, i.e. rapidly improving its RER, are needed to provide the basis for retoring growth and reducing unemployment. These include reforming the tre regime, lowering labor costs in real terms, sbteamlinig the tax rgime, and improving the framewoik for privat sector development. 18. Barbados needs to rapidly implement a comprehnsivetrade reform progrm to sharly reduce the economy's cost strut, improve resorce allocation and realign incentives to stmulate exports. The trade regime is extemely distorted and complex and relies heavily on diffent tafiff rates, import surcharges, and qantitatve resticdons. Trade taxes bave aimed at protecting the import-substitutng manufg and agrtual sectors and have generated a strong anti-export bias and a wide dispersion of effective protection. The regme has become progrsvely less hansparent over time; specil provisions and exemptions are applied on a case-by-case basis, leading to a complex and costly t administrion system. The main agenda in trade refom includes rpid movement to reduce the Common Exena Tariff (CET) tariff to a 5-20% band, In line with te recent 0fast tmack" Caribbn Community (CARICOM) agreement, ad elmination of stamp duties and other import surcharges, and of quatitativ restricton. 19. Lowering labor costs in real terms will also be crtcal for the socess of the structural adjustment progim. The stabifization program envisged a gradual realigment of the RER through fiscal, monetary and wage restaint While real wages have fallen slgy, no significant RER depreciation has occurred so far. Therefore, a continued comim.nt by Baradian society to a sti policy of fiscal, monetary and wage retaint remains esseal as well as a consensus on the need to significantly lower real wages. Steps also need to be take  -7- to improve labor mobility and employment generation through a review of the severance payment system, of the existing legal framework and practices governing industrial relations, and through reductions in the level of payroll taxes. 20. Under the current stabiization progm, Batbados has initiated a reform of its direct tax system, which will be implemented gradually over the next three years. The new syste. aims at simplifying and reducing the various payroll aes and levies; lowering the maximum individual tax rate and harmonizing the indtvidual and corporate income taxes and social security schemes; and at broadening the tax base to allow for a reduction in taxes on low-income earners. The maximum tax rate is high (40%) and has to be brought down to the levels prevailing in most of Barbados' CARICOM partners so that Barbados can compete on equal grounds for new investment. In addition, Barbados will need a major simplification of its indirect tax regime and replacement of the various consumption tams by a value added tax. The present consumption and services tax system iq extremely complex and full of anomalies, and the cost of collecdon and of ensuring compliance has been increasing. Ihe VAT implementation is also critica to support the trade reform package by providing a more flexible and less distortional7 revenue source. 21. The climate for private investment has worsened in recent years; private invesUnent has tagnad since the mid 1980s. Enhancing the role of the market as the mechanism for resource alocation by implementing a more neutral incentive framework along the lines discussed above is crucial to improve the envient for private sedor development. However, fiuther streamlinng of procedures and administive barriers wiU also be needed. Key measures include: (i) rvision of the bankruptcy law to facilitate on of companies; (i) revision of the land use policy which places very rigid restictions on the sae of agriculrtual land and allows for a high degree of government discretion; (iii) improvement of the transparency and autmaticity of the fiscal incentives regime; and (iv) simplification of registration procedures for new investments. 22. PubLHc Sector Reform. For more than two decades, the pubfic sector has played an important role in the country's development. Heavy public investment in i cue and social services contted to underpin rapid economic growth, social development, and a favorable distibution of income. However, the progressive extesion of the public sector, including a widespread involvement in commercial and industr activities, contributed to the loss of efficiency of public services, crowding out of private investment, and deterioration of the public finances while increasing the country's levels of taxation. Additionally, over the last two years, the urgency to balance the fiscal accounts resulted in expditure cuts that have further deteriorated the quality of publc services and focused excessively on capital expenditue. A major public sector reform is therefore needed to reduce and reorient the Government's role in the economy. The main objectives of such a reform would be to: (i) epand and accelerate the Government's divestment program to include all industial and commercially oriented enterpnses; (ii) restiucture the level and composition of public expenditure to further reduce transfers and current expendime, and to increase investment; and (di) stemline the  -8- bureaucracy and review its fuctions in line with an increased role for the private sector as the main engine of growth. 23. The quaity of the pubLic sector In Barbados has tdtionally been very high. However, recent layoffs and across the board salary cuts were not desgoe witin a co-prehensive review of the publc sevce. Despite the recent layoffs, some depannts are st1 ovestaffed wbile others have bee losing senior civil servts. Furhr sg of tu administtion is still needed. However, actou to reduce the public sectr wage bi1 wil need to be made wthin a close rview of the futuw role of fte public sector in the economy, and be iplemented in line with salary movements in the private sector to enable the public sector to retain qualified perSOnnel in its core functions. In the meandme, selective technical assisco will b3 required to stengthen the adminisatin's capacity to implement the structurl adjustment program. 24. Socia Dimenlous of Adjustmlt Barbados has achieved sdal indicato compable to those in developed counies. In addition, the ountry managed to substatialy eliminate poverty. Life expecncy at birth is about 75 years. Illitacy is vituay noestent, and the educational level of the labor force is high, with over 70% having at least a secondary education, and about 50% employed in white coBar work The country's impressive past economic peformance, togethe with is liberal and comprehensive soial welfar system and well- developed safety net, contributed to this outcome. However, the welfare system is extremely costly and somewhat infficient, and it is beng stained by rig unemployment and fiscal restaint measres. Barbados' social services priorties need to be redirected to the tmly needy groups, including the newly unemployed, women, especialy those heading households, and chidren under age 16. In addition, productivity needs to be incased by sRengthein fg the educaton system. Moreover, a review of the education ad health sectors, social secuity benefits system, and the socid welfare age s needs to be unden in ordar to achiev a more equitable and cost-effective delivery of services. Improved taget, introducing reasonable user charges to recover costs i education and health, and a more reasonable beneits/contibion ratio in the Socia Security System need to be achieved. The isues related to the education sector are being addrssed by the prposed Human Ruces Project. 25. ur d Fancia Secto Refrm. The main Is conronting the agickult sector is the inceased losses of the sugar industry, which represent 50% of agriculural output. The sugar industry is in a state of crisis and has become one of the least effie in the world; its ouput curty stands at less than half its 1980 level. Production costs are high and the idustry is heavily indebted and poody managed. Furhrmor, sug debts have placed the stte-owned BNB in a perilous financial stae, enting a ti s to public confidence in the financa sector, as BNB holds about a quarter of the baing vstem toWa abieles to the public. Tbe Govenmment has recently begun to implement a bro- Jased plan to rehabilhtat the industry, modify the land use policy - which sverely resticts the conversion of land to other uses - and restructure the BNB. Rapid ip of this program wMi be essential.  -9- 26. Environmental lssues. Protecting the environment is necessary for tha long-term sustnability of Barbados' development, as tourism depends largely on natural resource exploitation. Recent studies point to the degradation of the marine ecosystem, comprising reefs, near-shore fisheries and coastal areas, mainly resulting from soil erosion and household and commercial liquid and solid wastes. The Government has a development plan to eddress these issues and needs to urgently implement an environmental protection policy focussing on the establishment of an integrated national network of protected areas and national park, new enviromental legsation, public investment in waste managment, and regional environmental presevation initiatives. While assistance in these areas is currently provided by the IDB, care will need to be taken to ensure continued focus on the environment, while undertaking the broad-based adjustment program required to resume and sustain growth. B. Bank Assistance and Graduation Stratea 27. Barbados became a member of the Bank in 1974. Since then, it has received, net of cancellatons, US$95.4 million in loans for eleven projects. These include assince in the education, tourism, industry, power, highway and agriculture sectors as well as the financing of technical assistance to support the Ministries of Finance and Planning, and of Agriculture. In addition, the Caribbean Development Bank (CDB) has on-lent US$6.7 million to Barbados from resources provided by the Bank. Since 1984, when the graduation stateg was elaborated, US$35.2 million have been commited for three projects in the areas of secondary education and taning (US$10.0 million), agriculture development (US$4.0 million), and road main nce and fhabilitato (US$21.2 million). These projects, together with the proposed Human Resomurces Project (US$1.8 million) outlined in this report, meet the objectives of the phased grduation progam, viz., to srengt Barbados' institutional capacity so that it can finance and implement f*ture projects on its own. Progress in implementing the graduion program has been slow, however, due to delays in reaching agreement on the scope and objectives of specific operations. As a result, about US$20 miion still remain uncommitted under the program. The Government has requested the Bank to consider uSing the balance under the progrm for a picposed Stctua Adjustment Loan. 28. In general, project implen has been satisfactory, thans to the high quality of the civil service. The ongoing portfolio only includes the three projects aoved by the Board as part of the graduation stategy. The Second Education Project, approved in May 1986, is nearing completion; the Agcultue Development Proect, approved in Febnuy 1987, has progressed satisfctorily, except for slow progress on the credit line due to weak demand; and the Second Road eace and Rehlitation Proect approved in May 1992, has only been made effective recety. 29. In 1992, the Government reuested the assitance of the World Bank and the IDB In the development of a c he strucural adjustment program to complement the DO supported stblization efforL The objective of the program is to identify and address the key structrl issues affecting the economy in order to provide an appriate policy framewok to  -10- reestablish and enhance the country's growth prospects. After a detailed joint review of the issues, it was agreed that the World Bank would focus on the incentive framework (trade/tax reform and labor markets); public sector reform (divestment and public expenditure ionalization) and the social programs; while the IDB would focus on the reform of the agricultural and financial sectors and the reglatory fhamework for private investment. The adjustment program would be supported by two parallel operations by the IDB and the World Bank, and would be based on an DdF funded stabilization program being in place. On this basis, the IMP would provide assistance in elaborating a growth-oriented medium-term economic framework and in monitoring the key macroeconomic parameters under which the adjustment program would be prepared. Possible Bank support would be provided under a proposed Structual Adjustment Loan (SAL), and 1DB support through an Investment Sector Loan. 30. The objective of the proposed Bank SAL would be to assist Barbados in supporting a growth oriented framewozk over the medium-term, to enable the country to arest its economic deterioration and provide expanding employment opportunities to its population on a sustainable basis. Given the close complementarity between stabilization and structural adjustment, within a sdll fragle macroeconomic framework, as well as the balance of payment requirements that a growth oriented framework would entail, the Government was informed that continued Il! fnandal involvement beyond the expiration of the current Stand-by Arrangement at end-May 1993 would be essental as a condition for Bank support. In view of Barbados' relatively high per capita income, primary recourse has to be placed on the use of IMB resources for financing balance of payments gaps and to rebuild extemrnal reserves. The Bank's role would be to provide supplementry financial supo to facilitate the introduction of key strucural reforms, in parcular to meet the exter financig needs asciated with the rapid trade libeion required. In the meantime, the Bank agreed to provide technical assistance funds needed for the preparation of the programs of trade lberaliztion, divestment and public expenditure raionaliation, and development of the VAT proposal through the lpanese Grant Fund and the Bank's Institutional Development Fund. 31. Should the Government decide to proceed with the proposed SAL, it would be the last operation under the Barbados graduation program. It would provide resources to underin a major policy reform progam and help Barbados adjust its economy to the heightened world competitive enviroment. It would also entail a continuing policy dialogue with the authorities over a sufficient period to see the economy turn around. It thus offers the opportuny to see Barbados graduate under the best circumstances. Should the Government docide not to proceed with a SAL, however, or should agreement be delayed beyond a reasonable period, the proposed Human Resources Project would be the last IBRD opeion under the graduation program. DC and MlGA 32. The Inteational Finance Corportion's only investment in Barbados consists of an equity contnbution of US$0.3 million in 1984 in the Caribbean Financial Services Corporation which finances production ventures m the Caribbean region. The Coporation also provided a loan of  -11- US$1.25 million in 1986 for upgrading a tourist hotel. The Business Advisory Service (HAS) of IPC covers the Eastern Caribbean Region from its Barbados regional office. However, recent activities in Barbados itself have been limited to two small projects -- a wildlife reserve in 1991 and the conservation of a plantation as a tourism attraction planned for 1993 - in line with the deterioration of the private investment climate. BAS also acts as fmancial advisor in the ongoing privatization of LAT, the regional airline, in which the Government of Barbados has shares. Barbados became a member of MIGA on April 12, 1988. Relations with the IMF and the D1DB 33. The Bank has been working in close collaboration with the DLF and the MDB in the elabortion of the structural adjustment program required in Barbados. Review of progress and exchanges of views on competitiveness and policy options have been held at regular intervals among the three institutions. The IDB is Barbados' most important donor and has a large ongoing program. The IDB would also complement the Bank's efforts by prepang a technical assistance operation to support improvements in tax adminion and the implementation of the VAT. To be successful, the proposed adjustment program will need to involve continued close cooperation among the hee institutions, in view of the complementarity of the programs supported by each. Sunmmay Assessment 34. Barbados has achieved very high levels of economic and social development, but is cendtly facing major chalenges in its economic policies to adjust to a changing world eIent. The policy agenda faiing the country involves a fundamental review of the incentive framework to improve its competitiveness, and of the role of the public sector in the economy. The country needs to rm e rapid economic growth in order to reduce the prevailing high unemployment, and to improve its proicdvity levels in order to maintain and further improve current standards of living. This requires decisive actions to improve the incentive system for private sector investment and to strengthen the country's human resource base. In the short term, the margin for flexibiity is, however, limited, and the country needs to pursue strict stabilization measures while it undertks the stuctual adjustment program needed. 35. In view of Barbados' economic, social, and institutional achievements, primary recourse for financial and technical assistance should be placed on Fund and market resources. However, a coordinated approach by all multilateral institutions may be required to assist Barbados in its efforts to anrest the present economic decline and to resume a growth path. Thus, flexibility in the graduation program is requred. Should Barbados decide to implement decisively its stwmtu adjusment program, specific targets and objectives covering the whole development agnda would be embodied in the opeations supported by the IM, the DB and the World Bank. The ultimate test of this joint effort would be whether the country succeeds in reestablishing its impressive growth record over the last 25 years on a sustainable basis.  -12- PART H. THE EDUCATION SECTOR AND THE PROJECT A. Education and Trlning Sector 36. In spite of the impressive covere achievements of the post-independence era, the education and training system stil suffers from problems of quality and efficiency. Qualit issues in basic education include: weaknesses in instruction, lack of textbook and instructional mateials/technologies, inadequacies in infstucture, instiutional wealmesses and deflciencies in the examination and certfication system. The current examinations system has adverse effects on the curiculum and instrction, and ultimately on the qualit of edc'cation, and on learming achievement. The Barbados Secondary School Entrance Exam (BSSEE) is sfill used mainly as a selection mechanism for aRlocating secondary school places, even though capacity is now considered adequt. At the primary level, the BSSEE tends to restrict the curriculum in the upper classes to subjects tested on the exam, and to lead to a disproportionate attention devoted to student likely to do well, to the detriment of the less able students. At the secondary level, the ESSEE has a demotivadng effect on schools receiving a high proportion of students with low maris, reinforces the public perception of a pecking order of schools, and results in a substantial amount of remediation, particularly since 50 percent of the primary school children perform poorly on the exam. Moreover, the selection at the age of eleven does not take into account that children develop at different rates. Additional conerms include the relatively low achievement rates and the lmited certificaton of secondary school grdaes. The education system produces a small, highly educated elite, while many young people leave school with no recognized qualificatin and poor functional skldls for coping witb the labor market. 37. Public technical and vocatonal education and training (rVE1 programs at the post- secondary level play a pivotal role in the provision of skilled manpower, particularly as the number and scope of piivate sector training activities are lmited. Ihe qualiy of these programs is especialy poor, as there tends to be a strong focus on acadmi taining. Qualitative deficiencies stem from a virl absence of teacher training progams, ladc of access to instructionlmarials, crculum deficiencies, and lack of pay equity for instuctors. Targeted taning programs, aimed at youths, unemployed worker, and civil servants, are in ned of riizaton to meet growing demand. The National Tining Board WINB) has the legislative mandate for high-level strategic planning and coordiatin of TVET but its activities have been focused on the provision of basic kils training. Managerial weaknesses and the absence of a strong insttinal framework for the TVEI sub-sector are reflected in the lack of a national training pln, dupHLcaon in courses/programs at the post-secondary level, and absene of promotional campaigns to attact competent candidates. During this period of stailon and restucuring, it will be increasingly important to improve the coordinaton of WVET programs and rspiveness to private sector needs. Likewise, complementary efforts are needed to srgh public employment services, which cater mainly to the lower end of the labor market, and to improve the production and dis of labor market information essenial for planing purposes. Cognia of these deiciencies, the Government has recently agreed to limit the activities of the NTB to basic skills training and to establish a Policy Coordinating Council,  -13- which would: (i) formulate TVET policies, plans and investment priorities; (u) establish standards and performance targets for TVEr programs; (iii) coordinate the provision of TVET programs; (iv) advise on the overall resource allocation for TVBT; and (v) administer an Employment and Thining Fund aimed at financing sills upgrading of unemployed workes and in-company taining. 38. Public expenditures on education and training have historically averaged about 20% of the Govemment's recurrent budget, or roughly 6% of GDP, placing Barbados towards the upper end of the spectrum in terms of educational oudays in the Caribbean, and in the developing world. Since the recent economic downturn, the Ministry of Education (MOE) recunent budget dipped to about 16% of the total Government recunent budget. Authorities recognize that in this environment of fiscal austerity it will become increasingly important to address with renewed vigor cost efficiency and cost recovery issues. Student/teacher (SIT) ratios in Barbados are low (20:1 and 18:1 in primary and secondary education, respectively) in comparison to comparable middle-income countries, where they tend to average about 30:1. During the past decade, effofts to raise these ratios have not yielded positive results, even though within the last two years the trend has been improving. At the prmary level, the problem is compounded by the existence of a large number of small schools, while in secondary education the key issue is the wide range of subject options provided, partcularly in technical/vocational programs. To aise S/T ratios, the MOE has now adopted the following remedial strategies: (i) continue the amalgamation of small, uneconomical schools; (ii) intouce multi-gade teaching; (iii) expand pre-primary enollments and accommodate a growing number of secondary school students affected by the closure of private schools; and (iv) concenrte TVET course offerings to upper secondary and/or to a limited number of schools. Lkwise, MOE officias recognize that while Erd3stn Teacher Training College has historically played a pivota role in the prvision of initial teacher taing, its mandate needs to be rvised, in light of the prqjected decline in school enrollments and the adequate pool of tained teachers. Government has therefore suspended intial teacher training at the prmary level and has taken the decision to consolidate all in-sevice teacher taining at Enliston College. 39. As the Government grapples with the deteriorating financial situation, various iniiatives ate also being taken to develop new financing poLcies and mmse cost recovery, which now represents about 3% of the total education rcurrent budget (i.e., texObook rental, petty fees, evening school fees). In the last year, the Barbados Community College (BCC) has ta an active role in elaborating a new cost recovery policy; the Samuel Jackman Prescod Polytechnic (SlPP) has introduced mateials fees; and the MOE has instituted nominal school meal fees and raised the annual textbook rental fee in secondary education from BDS$20 to BDS$75. While the introduction of these measures constiutes an important step in the right direcon, the overal level of revenues generated remains modest, particularly since the GOB has been reluctant to introduce fees at the University, even though from an equity point of view this seems essential. There is now a growing recognition that Barbados will be compelled to join the ranks of countries which have introduced a fee collection system at the tertiay level, even though authorities express concerns over the pace and scope of these policy reforms. The priorities at  -14- this stage are to monitor the impact of the recently introduced fees; to elaborate a comprehensive cost recovery program (with explicit exemption guidelines for the poor); and to carry out public iformation campaigns to foster a broad based national consensus. 40. The Govermment's overall education strategy is to improve quality, cost efficiency and educational opportity. A comprehensive education reform has recently been launched with the following objectives: (i) replace the BSSEE with continuous assessment exams to improve learnng achievement; (ii) permit access to secondary schools from the catchment area, which would lower tansportation costs; (iii) introduce certificates of leaming; (iv) provide a broad based lower secondary education (up to 3rd form) to increase flexdbility and employability; and (v) concentrate/consolidate TVET course offerings in upper secondary and/or in strategically placed schools, which would generate considerable cost savings. The Government's TVET strategy aims to: (a) raise effectiveness, efficiency and responsiveness of public TVEr programs; (b) improve management and panning; and (c) encourag the expansion of private sector training. The centerpiece of this strategy is the establishment of the TVET Policy Cordinatng Council/Employment and Training Fund (MTM. The ETF would form the pillar of the Government's strategy for alleviating the adverse effects of the structural adjustment program, for enabling Barbadian workers to acquire the skills necessary to respond to emerging opportunities resulting from the economic rstructuring, and for contrting to long-term human cpital development. The Govermment also proposes to improve conditions for job-seekers by strenghening public employment services and stining registion procedures, and to enhance the quality and timeliness of labor marcet infonnation. B. The Project Project Objectives 41. The principal objective of the pmposed project would be to strengthen the country's human capital base by expanding the availability of trained manpower. Tbe specific objectives would be to: (i) strengthen the quality and efficiency of basic education, with a view to raising student achievement; (ii) improve the effectiveness, efficiency and responsiveness of TVET; and (iii) reiforce employment sevices and labor maikt information. To these ends, the project would include four components: General Education Support, TVBT Development, Labo Marke Support, and Proect Admintion. Project Description 42. The General Education Support Component (US$4.9 million equivalent, including contingencies) aims to reinforce the basic educaton foundation by improving the quality of services and raising internal efflciency. This objective is also supported by a parallel-funded IDB operation. The upgrading of general education would be accomplished through the provision of: staff taining; textbooks/reference materials (IDB); learning resources; infrastcure upgading (1DB); reinforcement of MOE institonal capabilities (IDB); as well  -15- as design and reform of the national examinatis/certificaton system and costs/fnacing policies. The project would support the expansion of innovative and cost-effective instmctional srategies such as multi-grade teaching and school-based training. The TVET Development Component (US$9.3 equivalent million, including contingencies) aims to increase the effectiveness of 1VET programs tbrough the provision of key inputs to the leaming process (i.e., instructor training, learning resources, curriculum/program development and insitutional reinforcement) and to raise eficiency through increased sharing of facilities, expanded use of program review/evaluation procedures, and introduction of user fees in post-secondary education. Responsiveness would be improved through the introduction of flexible curicula, use of contract training, and increased accountability of institutions. A new multi-certification level teacher training program would be implemented, two teacher resources centers would be established, curiculum development specialists would be traned, and spport for selective TVET training programs for unemployed youths and civil servants, and for the establisment of a BCC industry service unit, which would operate on a cost recoveiy basis, would be provided. Institutional capabilites would be bolstered by providing assistance to the new TVET Policy Coordinating Councl/EI for elborating a National Training Plan, performance targets, and an articulation manual. The Labor Market Support Component (US$0.5 million equivalent, including contingencies) would provide support for compuPtezing the employment information and placement system and strengtheng educational and occupational counselling at the National Employment Bureau, and increasing the capacity of the Manpower Research and Siical Unit to analyze and disseminate labor market information. Tlhe Project Administration Component (US$0.9 million eqpivalent, inchlding coingencies) aims to strengthen the Education Project Implementation Uni (IU) though local consulnces, staff taining, and equipmen. Proect MaEmt nd nplementtion 43. Gien the complexity of the proposed project and the number of miniies involved ducation, Labour, Community Development and Civil Service), and in light of the long standing experience and good track record of the MIU, this unit would coinue handling procuement, accounting, and auditing for all project activities. Each minity would make provisons in its own budgetary alIocation for ependitures relaed to the its respective components. An Itministal committe, cbaired by the head of the MOB Planing Unit and comprised of repntatives of the beneficiary ministe, will oversee and monior the implementation of Xt policy and i nal development activities. The committee would be reonsible for coordinatng the elaboration of reform measur, preparing anal work programs, budgets, and bi-nnual stas reports, and paricpating in annual evalutons. Projec Sudaanbity 44. At project compledon in 2000, the annual incremental recurrent costs ane estmaed to be US$1.3 million equivalent, which would represent about 0.2 percent of the projeced Government recurrent budget, and less than 10 pement of the expected savings from the cost  -16- efficiency (increases in studenttteacher ratio) and cost recovery (introduction of tuition fees) measures supported under the project. The Goverment should be in a position to absorb these modest incremental recunrent costs. Leons Leared from Pevious BDan Involvement 45. The Government of Balbados has received two Bank education loans (representing a total of US$22 milion equivalent), which have contributed to broadening educational oppotuny and raising quality and relevance, but have fallen short of their objective of improving cost efficiency. The key lessons learned from the implementation of these projects, which were integrated into the design of the proposed opezation are: (i) a coherent policy reform agenda with specific quantitative targets must be elaborated and monitored closely by both the Govenment and the Bank, (Ii) likages between technical assistance/fellowships and project goals must be strengthened; and (iii) procurement procedures should be strengthened by involving beneficiary instutions in the elaboation of technical specifications. Rationale for Bank Involvement 46. The rationale for Bank support is that this project would be instrmenl in the design and implementtion ofpivotal reform measures, in addition to providing an essential complement to a parallel IDB-financed project (US$14.5 million, of which MDB funding is US$11.6 million) aimed at improving basic education and isbtionl str ing of the MOB. Moreover, it would consoEdate the achievements of the fir two projects, support the Govemmen's educaton reform initative, and leave in place the framework for improved management of the educadon and triing system. Agreements Reached 47. Diurng negotations, ovel agreement was reached with the Government on the following documents submitted for approval: (i) sandard bidding documents, design plans, implementation schedules, and updated cost esimates for all civil work components; master lists for procurement of equipment, funiture, and books and estimated value of contacts; and terms of reference for coancies and studies; (ii) draft educain deelopment plan (1993-2000), which reflects the Government's policy fiamework; (iii) legal provisions for estabshing the new TVET Policy Coordinating Councl/Bmployment and Tning Fund (MY) and for effecting changes in the National Tning Board's mandate; (iv) the S-year education publc expendir program and the 1993/94 budget esmates, which are consistent with the Goverment's education straty, and reflects adequate levels of counerpat funding and non-salary opeati budgets for the entites supported under the project; (v) fuotre mandate of Biion College; and (vi) iutional amngements for project implemention. 48. As conditons of effectveness, (i) tale all necessary actions for revising the mandate of the NTB, and for establishing the TVEI Policy Coordinating Council/ETP, with an appropriate  -17- structure, mandate, and staff, which is acceptable to the Bank;, (ii) adopt a set of regublions, acceptable to the, Bank for the operation of the ETF; and (fi) appoint an executive director an administrative and financil officer, and an expert in raining fund nagement, al with functions, qualificatons and experience satisfactory to the Bank. 49. As condWdon of disbursement for project activities related to the upgrading of Erdiston College, including acquisition of furnimre and equipment, no funds will be disbursed unless the Bank has received final design plans, cost estimates and technical specifications, all satisfactory to the Bank. 50. The following actions have been agreed upon to ensure successful implementation of the project: (a) submit to the Bank (no later than December 1993) a detailed, time-bound action plan, safatoy to the Bank, fo ructuing of Erdiston College, wbich would provide for: implementation of the revised mandate; adoption of cost-effective teaching modes that take into account the projected demand for in-service taiing; staff reduction targets and discontinuance of iniial teacher tmining at the primary level; and implement agreed upon acton plan; (b) submit to the Bank (no later than December 1993) a time-bound action plan for reducing the unit cost of technical/vocational courses in secondary education through the concentation/consolidation of course offerings in upper secondary education and/or in staegically placed schools; and implement plan accorig to ageed upon timetable; (c) design a program, acceptable to the Bank, (not later than August 31, 1996) for the delivery of flexible training to the private sector at the BCC; and establish a dvision (Industry Services Unit) at the XCC for admnisting theprogram, which would operate on a cost recovery bads; (d) improve the internal efficency of the education and tbrning system by progresdvely raiing S/T rados, so as to reach 23:1 in primary education and 19:1 in secondary education by January 31, 1996, and maining them above these levels thereafter; (e) submit to the Bank (not later than December 31, 1994) a time-bound cost recovery progam for the tertiay institutions (UWI, BCC, SJPP, Enrdiso College), and thereafter implement the program; (f) submit to the Bank through the TVET Policy Cordinating Council (not later than December 31, 1996) a Nation Training Plan, prformance trges for post-secondary TVET programs, and an aricultion manual; (g) submit to the Bank for Its review and approval (not later than January 31 of each year) the proposed rolling five-year public expenditue program (PEP) for the education and raining sector, and the evidence of ack ependiturs incured in the education sector in the previous year (not later han May 31 of each year); and iplement the PEP; (h) submit bi-amuma progress reports to the Bank not later dhan July 31 and December 31 of each year, and an anmal woik program (not ter dthan January 31 of each year); (i) hold anual reviews with the Bank during the first quarter of each year and a mid-term evaluaton in 1997; and G) maintain the TVEr Conil, the EPIU and the ne isti Committee with functions, structure and staff satisfacty to the Bank and opeaoe the ETP in accordance with the regulaions agreed with the Bank  -18 - Envionment impact 51. The project would have a positive environmental impact to the degree that environmental awareness themes are integated in the teacher training program, and TVBT institutions produce trained technicians (i.e., electricians, equipment maintenance speciaLsts) who would represent a source of manpower for industry and enviromental projects. No adverse environental effects are expected from the civil works activities to be funded under the project. Program Objective Categories 52. The project is under the human resources development category. Targeted assistance would be provided to youths, unemployed workers, and civil servants through various training programs. The BTF would serve as the key mechanism for targeting training and retraining activities aimed at vulnerble group (e.g., retrenched workers or those about to become retched). Projet Beneft 53. The principal benefits of the project are the quality, efficiency and equity gains. Reform of the national examinations and certfiation system would broaden educational opportunities and the design/inoducton of cost and financing stategies woudd allow the Ministry of Educaton to cope with the challenge of increasing quality in light of growing fisca presures. The establishment of a Policy Coordinating Council would enhance policy, planning, and coordinating capabilities in the TVET sub-sector wilLe the creation of an Employment and Tmining Fund would allow the Govermment to address the rting needs of the labor force. Strngthened employment services would contibute to accelerating labor absolption and lowering unemployment benfits. Piroject Ris 54. The project faces the following riks: ( uncertaty over the macroeconomic envirnment, which may adversely affect the availability of countear funds, and the reus to investments in the TVET and labor market components; (H) the potental difficulties the Goverment may face in addressing poliically and socially unpopular sector issues, such as redundancy in the teacher corps and user fees; and (iii) the complex and broad scope of the opeaon. To minimze these sks, the opeaon would be phased over a 7-year period, assunces will be sought on the timely availability of Govment funds, sufficient financing would be provided to carzy out workshops aimed at geneting a broad based consensus for policy reforms, and an approprate insiuonal agement for project implementtion would be suported by the project through training and echnical ssisnce.  -19- Rwommendation 55. I am satisfied that the proposed loan would comply with the Articles of Agreement of the Bank, and recommend that the Executive Directors approve it. Lewis T. Preston President Attachments Washington, D.C. June 4, 1993  -20- Schedule A BARBADOS HUMAN RESOURCES PROJECT Estimated Costs and Fiancing Plan US$ Million Estimed Cosb: Local Forein Total A. General Education Support 1.8 2.2 4.0 B. Tocbnical and Vocaionl 4.5 3.1 7.7 Educadon and Trabiing C. Lbor Market Suppo .3 A D. ProjectAdmistratln .8 .1 .9 i. Project Preparation Failt .2 .3 .5 TOTAL BASELiNE COm 24 i I" Physical .3 .3 .6 Price 1.0 .6 1.6 TOTAL PROJECT COSTS L 6.9 liS Note: Columns way not add due to rounding. US$ Million gbnb Prn Local Foreign Total Governmet 7.8 0.0 7.8 IBRD 0.9 6.9 7.8 TOTAL 8.7 6.9 15.6  -21- Schedule B BARBADOS EUMAN nISOUtCS PROJCr Pocurement Methods and Disbusments Procurement Methods (US$ Nolln) Catepry of Expendtu ICE LCB Otherlg N.A. Total Cost CivilWors 1.6 - 31.6 (0.3) - -(0.3) l3Mpm and Trninf, 2.2 0.9 0.1 3.2 ipment and Training (2.2) (0.4) (0.1) (2.7) Furnitue - 0.6 - - 0.6 (0.5) - (05) Boaok Reference Materials - 0.6 - 0.6 -05) - (0.5) Professional Fees - 0.2 -0.2 TochnilAit - - 5.1 - 5.1 - - (2.6) (2.6) Traing 1.1 1.1 - - ~~~(0.5) (0.5) normntalO & M - 2.7 2.7 and Staff Sala - - (0.0) (0.0) PPF - - O0 - 0.5 * - (0.5) - (05) Total 5A Note: ire in pareanthses are do rospecvemounts f ced by the Bank: N.A.- Not Appcable LS o pOIwhmrocu ptoeodurea inclde Inernafional and loe shopping; mnotiated purchases for bookl and joumdsl; and ou comfSuvs. by CatAgory The loa wM disburs the following percentages, by cabtgory of expedtr: o 20 pewant of civil wors o 100 peret of forei xpeditures of dirct Impoed goods and 8S percent of locally proured goods suh as equpme and trainn materials, ritu, books and renc materials o 100 pOrCent of foreign consting sevices * 35 percen of local cnting servs and prfteiond fes (including architectural and engineern fes) e 100 percent of oversea and loal taing and study tus. Estbnated Schedule of kbbursenieb (US$ m0lo) ANNUAL FY FY93 FY94 FY95 FY96 FY97 FY98 FY99 FY2000 Annual 0.5 0.5 0.3 1.8 1.5 1.8 0.9 0.5 Cumulative 0.5 1.0 1.3 3.1 4.6 6.4 7.3 7.8 Noto: FY93 disburenmts refer to the PPF funds.  -22- Schedule C BARBADOS HUMAN RESOURCES PROJECT Tmetable of Key Project Processn Eents (a) Tlme takn to prepare 14 months (b) Pspared by - Ministry of Education - Ministry of Labour, Com er Affairs, and the Environment - Mnistry of Housing, Lands, Community Development and Culture - Minisy of Civil Service (c) First Bank Mission December 1991 (d) Appsal Mission June/July 1992 Pbst-Appra Mission Febray 1993 (e) Date of Negos May 1993 (t) Planned Date of Effectivness November 1993 (g) Relevt PCs and PPARs Fist Education and Tanig Project (Lan 1642-BAR)- PCR, May 4, 1989 PPAR, May 6, 1991  Schedule D STATUS OF DARK GROUP OPERATIONS IN BARBDAOS .. .... ............ ....................... _. A. Statement of Sank Loans as of Aprll 30, 1993 ............................................. *----------USS Millfon.. Amrunt Loan Ffscal (Less Cancellation) No. Year Borrower Purpose Sank Undisbursed ... ........ ........ ....... ............. ..... ..... X. ...... ........ ........... 8 toans closed 52.7 L2680-SAR 1986 Barbados Education Il-A 10.0 1.6 L27820-BAR 1987 Barbados Agricultural Development 4.0 1.6 L34930-BAR 1992 Barbados Road Maintenance and Rehabilitation 21.2 19.5 TOTAL nurmber of loans * 3 35.2 Total 87.9 22.7 of which has been paid 43.6 TOTAL Held by Bank and IDA 44.4 Amount Sold 1.3 of which has been repaid 1.3 0.0 Total now held bv Bank 44.4 _ u=s Total Undisbursed 22.7 a. Statement of IFC investments as of March 31, 1993 Fiseat Type of -- . us- - tMillIfon-...... Year Oblfgator Business Loan Equity Total ...... .......... ............... _ ........ .................. ......... .... 1984 Caribbean Financlst Finance for productive 0.3 0.3 Services Corp. ventures in the Caribbean 1987 Town end Comarciat Tourism 1.3 1.3 Properties (Barbadoi) Lioited Total Gross Commitments 1.3 0.3 1.6 Less Cancellations, terminations, participations, sales and repayments 0.2 0.0 0.2 Total Coamftments now held 1.0 0.3 1.3 - T t su d nspf na Total tndi8bursed (Including participants) 0.0  IBRD 24710 North Point '~'BARBADOS HUMAN RESOURCES PROJECT (/ PRIMARY SCHOOLS 0 'arrison { SECONDARY SCHOOLS Q NTB SKILLS TRAINING CENTERS 4& BARBADOS COMMUNITY COLLEGE A SAMUELi. PRESCOD POLYTECHNIC -~ 11 MOE PEDAGOGICAL /ADMINISTRATtON BUILDING NATtONAL CAPffAL l3e15' o SELECTED TOWNS Rolandi AtPR tEd.rs/ MAlN ROADS Bass \ / S / 9 - t gJt / 5 .Ut. ~~~~~~MtTabor ~ i t3 t Y l // i > ~~~~~~~~~~~~~~~~~~~~~~~~~~~1305 1AW ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~~~4 Queen's ) X BROW:seige, St. \StephenJ . . ~~~~~~~~~~~~~~~~~~~~~R$O 4 . MFsQJA ND 8AS( *[.MX