China - Second University Development Project

Document of The World Bank FOR OFFMCIAL USE ONLY Report No. 14530-CHA PROJECT COMPLETION REPORT CHINA ECOND UNIVERSITY DEVELOPMENT PROJECT (CREDIT 1551-CHA) MAY 19, 1995 Poverty, Population, and Human Resources Operations Division Country Department II East Asia and Pacific Regional Office This document has a restricted distribution and may be used bv recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Name - Renminbi Currency Unit - Yuan (Y) At Appraisal $ 1 = Y 2.80 At Completion $ 1 = Y 7.72 FISCAL YEAR January 1 - December 31 ACADEMIC YEAR September 1 - June 30 ABBREVIATIONS AND ACRONYMS AAPRC - Audit Administration of the People's Republic of China CNTIC - China National Technical Import Corporation CRC - Chinese Review Commission FILO - Foreign Investment and Loan Office IAP - International Advisory Panel MOE - Ministry of Education MOF - Ministry of Finance NAS - National Academy of Sciences SEdC - State Education Committee SOE - Statement of Expenditure SPC - State Planning Commission UDPI - First University Development Project  FOR OFFICIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-General Operations Evaluation May 19, 1995 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on China Second University Development Project (Credit 1551-CHA) Attached is the Project Completion Report on China - Second University Development Project (Credit 155 1-CHA) prepared by the East Asia and Pacific Regional Office. Part II was contributed by the Borrower. The report gives a satisfactory account of project implementation constraints and results. The project supported the first phase of the Government's 1 0-year program to increase the output of high-level technical and managerial manpower through adjustments in enrollment, quality and efficiency related to engineering and economics and finance. To achieve this goal, the project included a program of action on policy and institutional changes supported by equipment, training and technical assistance for 39 of the country's universities. Overall the outcome of the project is rated as satisfactory. All components were substantially implemented and achieved. However, the sectoral actions were less satisfactorily implemented because preparation of the policy content proved to have been inadequate and the design of the operation did not provide for explicit linkages between policy objectives, project actions and monitorable indicators. Nevertheless, institutional development in universities supported by the project is rated as substantial and sustainability as likely. An audit is planned as part of a cluster of related projects. Robert Picciotto by Francisco Aguirre-Sacasa Attachment This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.   FOR OFFICIAL USE ONLY PROJECT COMPLETION REPORT CHINA SECOND UNIVERSITY DEVELOPMENT PROJECT (Credit 1551-CHA) CONTENTS Preface ............................................. i Evaluation Summary ...................................... iii PART I: PROJECT REVIEW FROM IDA'S PERSPECTIVE 1. Project Identity. 1 2. Project Background. 1 3. Project Objectives and Description. 3 4. Project Design and Organization. 4 5. Project Implementation. 5 6. Project Results. 7 7. Project Sustainability. 9 8. IDA Performance. 9 9. Borrower Performance ............................... 10 10. Consulting Services of the IAP and CRC .................... 11 11. Project Documentation and Data ......................... 11 12. Lessons Learned ................................... 12 PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE A. Comments on the Analysis in Part I ....................... 14 B. Adequacy and Accuracy of Factual Information in Part III ... ...... 16 C. Evaluation of IDA's Performance ........................ 16 D. Evaluation of Borrower's Performance ..................... 17 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  PART III: STATISTICAL INFORMATION 1. Related Bank/IDA Loans and/or Credits ........ ............ 18 2. Project Timetables ................................. 20 3. Credit Disbursement ................................ 20 4. Implementation Indicators ............................. 21 5. Project Cost ..22 6. Project Financing ..22 7. Status of Covenants for the Second University Development Project .... 23 8. Staff Input ..25 9. IDA Missions ..25 MAP IBRD 26959  PROJECT COMPLETION REPORT CBINA SECOND UNIVERSITY DEVELOPMENT PROJECT (Credit 1551-CHA) PREFACE This is the Project Completion Report (PCR) for the Second University Development Project for which Credit 1551-CHA in the amount of SDR 148 million or $145.0 million was approved on February 26, 1985 and closed on December 31, 1992 after it had been extended for two additional years. The extensions were requested by the Chinese Govemment in order to further strengthen the economics and finance curriculum development component of the project and procure additional spare parts for project supported equipment. The last disbursement was made on February 10, 1993 and the total disbursements were 100 percent of the credit amount. The PCR was prepared by EA2HR (Preface, Evaluation Summary, and Parts I and Im) except for Part II which was prepared by the Borrower, represented by the State Education Commission. Initial work on the PCR started in mid 1992 by obtaining qualitative and quantitative information from the Borrower during a supervision mission for the Key Studies Development Project. The PCR preparation is based, inter alia, on the Staff Appraisal Report, Credit Document, IDA supervision reports, the Borrower's progress and audit reports, the International Advisory Panel (IAP) and the Chinese Review Commission (CRC) evaluation reports, correspondence between IDA and the Borrower, and internal Bank memoranda.   - iii - PROJECT COMPLETION REPORT CIINA SECOND UNIVERSITY DEVELOPMENT PROJECT (Credit 1551-CHA) EVALUATION SUMMARY Introduction 1. At the time of appraisal, and based on its sector work and dialogue with the Chinese Govemment, the Association had adopted an education lending strategy which consisted of three lines of action: (a) develop technical and vocational education to increase the supply of technicians and skilled workers; (b) strengthen the education of teachers and administrators and improve the quality of teaching materials and management in basic education; and (c) expand higher education and improve its quality and management to provide more high-level manpower. 2. The Government placed a priority within the education sector upon the rapid expansion and improvement of higher education to help reduce the then serious manpower constraints on the country's economic development. It was felt that the imbalance between manpower supply and requirements was particularly acute in the engineering and economics/finance sector which were essential for technological and managerial improvement of the economy, as well as in university post graduate programs. The project therefore included support for expanding enrollment, improving teaching and research programs including curricula reform and teacher training, and improving management. Project Objectives and Scope 3. As the first phase of a ten year program (1985-94) to build up high-level technical and managerial manpower required for national development, the project sought to support adjustments in enrollment, quality, and efficiency related to engineering, economics and finance education. To achieve this goal, the project would implement a program of action on policy and institutional changes which addressed three basic issues of the subsector: low level and imbalanced structure of enrollment, inadequate quality, and inefficient planning and management. 4. To increase enrollment and redress structural imbalance the project sought to expand engineering, economics and finance, and graduate education programs at differential growth rates to adjust the imbalance of the overall university enrollment structure in response to development needs. While increasing enrollments was a project  - 1v - target, decreasing the percentages of engineering students as a percent of total enrollment from 35 percent in 1983 to 30 percent in 1990, and increasing economics and finance enrollments from 6 percent to 7 percent over the same period were also project goals. To improve quality the project sought to broaden undergraduate curricula in engineering, economics and finance by reducing the number of specialties, increasing the proportion of general and basic courses, and introducing new courses to produce graduates who could meet the demands emerging from the modernization program. In addition, the project aimed at revitalizing the teaching force in engineering and economics and finance. Planning and management capabilities were to be increased by introducing new procedures to improve planning and maintenance of facilities; increasing the student/staff ratio, utilization rates of classrooms, laboratories and libraries, and the proportion of commuting students; and establishing a mechanism to monitor and evaluate education development projects by creating a central unit within the Ministry of Education (MOE) and local units in individual universities (see Table 4). The project also planned to include studies to introduce new policies on quality and management. The project sought to support reforms by investments in individual subprojects. Thus the project was conceived of and designed as a sector investment although actual investments were only made to individual institutions of higher education, or "subprojects." Inplementation Experience 5. By the end of the seven-year project implementation period (1986-92) these fundamental goals of the project have been partially achieved. National enrollments in engineering and economics and finance have increased beyond project goals as can be seen in the project indicators (see Table 4 for project target indicators as they appear in the SAR). The goal however, of reducing the share of engineering enrollment in total enrollment from 35 percent to 31 percent was not achieved, instead enrollments increased to 36 percent of the total enrollment. The share of total enrollment for economics and finance surpassed its target increase of 7 percent to 11 percent. 6. The impact of the subprojects on sector or program goals cannot, however, be assumed beyond the development of the economics and finance curriculum (see para. 4.3) This inability to assess the impact of subprojects on the program goals is due in part, to lack of SAR indicators for individual subprojects. The SAR provides sectoral targets only. This lack of SAR subproject indicators was complicated by the apparent lack of full understanding by the borrower of the concept and design of a sector project, an observation borne out in early International Development Association (IDA) mission reports during project preparation. From the beginning of project design the borrower viewed the loan as a project loan and as a result, focused on implementation and supervision of project activities at the subproject or university level, and not national level sector goals. This observation is supported by the succession of IDA supervision mission reports which also focused on progress in implementing the subproject or university activities to the virtual exclusion of comment on sector targets. The State Education Commission (SEdC), in its final reporting on the project provided data only on the 39 subproject institutions and not the full sector.  v 7. Once the focus of supervision shifted away from sector goals, IDA's missions consistently reported smooth implementation of the project within subproject institutions and achievement of subproject or institutional goals. SEdC, responsible for monitoring and supervising the implementation of all aspects of the Project, has been seen to provide good leadership from inception to project completion. To addition, an International Advisory Panel (IAP) and Chinese Review Commission (CRC) were created to provide advice and assistance to SEdC on overall project implementation. The LAP and CRC through their joint policy meetings and site visits ultimately provided substantial supervisory assistance to IDA. Project supervision reports indicate that IDA judged the role of the IAP and CRC to be extremely valuable in the overall supervision of the project. 8. The major portion of the IDA credit was used for equipment procurement. Initial concern was expressed by the IAP over the universities' desire to purchase research equipment that was too sophisticated without proper consideration of adequate and appropriate maintenance. However, by detailed review of procurement technical specifications and their modification, IDA and the IAP eventually agreed that by and large the correct match between teaching and research need and level of instrument complexity was achieved. The IAP, however, repeatedly expressed concern over the need of the project universities to purchase maintenance agreements for the equipment. Many finally did purchase some agreements with the additional IDA credit funds made available through the shifts in the SDR/dollar exchange rates. Despite the effort of the universities to purchase maintenance agreements the IAP continued to be concemed that universities would not be able to contract for maintenance agreements after the life of the project due to lack of necessary funding. 9. The civil works were implemented satisfactorily during the early years of the project and covered construction of new buildings and renovation of physical facilities and fumiture. 10. The implementation of the technical assistance for the most part went smoothly. The only major problem associated with implementation of the project resulted after the events of June 1989 when the dispatch of foreign consultants and specialists to China was disrupted for a period of some six to nine months. However, the number of fellows sent abroad at the end of the project period was more than double the original target and more than 95 percent of project specialists invited by the Chinese universities, over 340 (see para. 5.12) in number, spent up to a month lecturing, consulting, and advising in the fields of engineering and economics and finance. 11. In 1987 the project organized an Economics and Finance Curriculum Development Seminar in Shanghai which included participation by international and Chinese experts in the economics and finance area. This seminar recommended the development and introduction of a new undergraduate minimum core curriculum in the area of economics and finance. This core curriculum was, in fact, introduced to some 250 institutions of higher education in March 1990 when SEdC recommended it for use in Chinese colleges and universities. IDA missions recognized the development and introduction of the new curriculum as the major accomplishment of the project.  - vi - 12. Because of shifts in the SDR/dollar exchange rate late in the project, and the consequent availability of increased US dollar resources which could be used to make purchases of equipment and instrumentation within the originally planned scope of the project, the project was extended for an additional two years. The extension allowed the borrower to complete procurement and provide for increased support in the area of economics and finance in order to assist the Chinese in maintaining the momentum of the implementation of the core curriculum. The project was completed by December 31, 1992. Results and Sustainability 13. The planning for the project took place in the early 1980's and was envisioned as the first phase of a 10-year program to provide China with high-level technical and managerial manpower. The project has helped achieve these goals. The major project objectives to increase high-level technical and managerial manpower through adjustments in enrollment and quality related to engineering and economics and finance have been fulfilled although the specific impact of the project on the increases is difficult to assess. Implementation indicators show that undergraduate enrollment grew significantly during the project period. The national engineering enrollments were 104 percent of the sector targets and economics and finance were 130 percent. The project support for the creation of a new economics and finance curriculum as well as the introduction of the new and broadened engineering courses was a primary element in increasing the quality of both undergraduate and graduate teaching in subproject universities. In addition, staff development has been advanced significantly in project supported institutions through a series of seminars on university management as well as teacher training programs, programs which sent faculty abroad and the invitation of international consultants. Efficiencies achieved as a result of the project are mixed. Student-teacher ratio indicators show that targets were not achieved during the life of the project although they do show slight improvement over base line indicators. On the other hand, the percent of experiments performed in engineering surpassed the targets indicating an increased utilization of equipment in the laboratories (see Table 4). 14. Sustainability of project benefits can be examined in terms of project design, enrollment, and curricula and faculty development. The sectoral approach to project design and the resulting success in development and dissemination of the economics and finance curriculum to more than 250 universities and colleges beyond those covered by the project is testimony to the continuing impact of this project. The enrollment increases that were achieved during the life of the project will continue to provide trained manpower in the two targeted sectors for the next 30 years. Likewise, the faculty training programs which included over 1,500 teachers in science and engineering as well as 1,800 introduced to the new economics and finance curriculum are also excellent indicators of substantial future impact on teaching in these disciplines. 15. The greatest short-term impact of the project was on curriculum development, especially in the areas of economics and finance. The long-term sustainability of these efforts could be a problem, however, unless there is continued  - vii - training, institutionalization of a syllabi compilation mechanism, support for textbook- writing, and organization of end-user seminars to identity specific problems in the economics and finance curriculum. 16. The human resource area of faculty development will have greatest long- term impact. Taking into consideration the continuing problem of the slow return of Chinese students and faculty sent abroad for advanced degrees, the best way to sustain faculty development is for Chinese universities to work out effective ways of upgrading and promoting sufficient numbers of younger faculty. Lessons Learned 17. The main lessons learned from the project experiences are: (a) Reform of the Chinese higher education sector is most possible within a supportive policy environment in which all participants, both within and outside the education sector, are in fundamental agreement on the scope, pace and direction of reform. The project's economics/finance core curriculum work was only possible because a political consensus existed in China in 1985/86 at the start of the project which supported the view that only by reforming the economic system could China obtain sustained growth. The Chinese government recognized that to reform the economy it must change the way it trained its economists and administrators. This consensus existed in all sectors of the economy and throughout the government and facilitated the rapid development of the curriculum. (b) Implementation of a project designed as a sector loan is possible only if there is an understanding on the part of both the borrower and IDA as to how a sector project is designed, developed, and implemented. In this case, the borrower, from the beginning, viewed this loan as a project loan and as a result, implemented and assessed the project on this basis. Likewise, IDA did an inadequate job of working with the borrower to fully explain the differences between and reasons for sector and project loans. This confusion from the very beginning resulted in a credit-supported activity which was described as a sector loan with sector goals but was implemented as a project loan with subproject goals. Accordingly, impact of the project on the overall sector goals (i.e., enrollment, quality and management) is difficult to assess because they were not monitored by either the borrower of IDA during project implementation. (c) The sector approach to project development was not totally a loss but was successful only when the project's impact on the economics and finance curriculum is taken into account. The new curriculum affects 250 institutions, well beyond the nine economics and finance institutions actually supported in the project. The lesson to be drawn from this experience is that sector designed projects can only be successful if the borrower fully  - viii - understands, designs and implements a sector activity from the start. This includes providing project targets that can be used to realistically calibrate success in implementing policy action plan goals. Confusion between IDA and the borrower on the fundamental goals (and thereby the targets) of a project makes the project difficult to assess. (d) The program approach to project design was a useful method to analyze and assess national issues and propose national solutions. In light of the development of a national economics and finance curriculum which continues to be developed and taught well after the project completion, the program approach has some merit. However, IDA and the borrower must both agree on how a program approach can be used to support sustained policy development over a period of time and through small projects. This has not been the case in IDA's the Bank's continuing work in higher education in China. (e) International technical assistance in education projects can provide vital and important educational inputs into a reform process which is underway and is fully supported by the educational policy structure. Major changes in economics and finance curriculum were possible for these reasons. International impact on the engineering curriculum was not as evident, primarily because it was felt by Chinese university administrators and academics that fundamental change in this sector was not critically necessary. The role of the IAP and CRC in preparing, implementing and evaluating education projects in China has been important. Both IDA and the Chinese government have recognized their importance. (f) Continuing efforts should be made to include maintenance contracts with the purchase of sophisticated equipment. Capacity to operate and maintain these major investments should be a main concern.  PROJECT COMPLETION REPORT CIUNA SECOND UNIVERSITY DEVELOPMENT PROJECT (Credit 1551-CHA) PART I: PROJECT REVIEW FROM IDA'S PERSPECTIVE 1. Project Identity Project name : Second University Development Project Credit No. : 1551-CHIA Country : China Sector : Education Subsector : Higher Education 2. Project Background 2.1 Sector Development Objectives. At the time of appraisal, and based on its sector work and its dialogue with the Chinese Government, the Association had adopted an education lending strategy which consisted of three lines of action: (a) develop technical and vocational education to increase the supply of technicians and skilled workers; (b) strengthen the education of teachers and administrators and improve the quality of teaching materials and management in basic education; and (c) expand higher education and improve its quality and management to provide more high-level manpower. 2.2 The Government placed a priority within the education sector upon the rapid expansion and improvement of higher education to help reduce the then serious manpower constraints on the country's economic development. There were two dimensions to the manpower constraint: the low level of overall university enrollment and the imbalance of enrollment structure. Between 1981 and 1983, the government reported that the overall supply of university graduates would meet only about half of the requirements in the national job assignment process. While the development of the economy calls for the expansion of the university sector as a whole, the structure of enrollment needed adjustment to meet the changing pattern of manpower requirement. The imbalance between manpower supply and requirements was particularly acute in engineering and economics/finance, essential for technological and managerial improvement of the economy, as well as in university post graduate programs. In 1983, engineering and economics/finance output would meet only 38 percent and 16 percent of the projected needs respectively, the lowest among the major disciplines. As a result of the serious manpower shortages in those two fields, central agencies in charge of priority industries,  - 2 - and banking and financing services had to function at suboptimal levels with unqualified personnel. Likewise, the university system was further constrained by the limited size of its postgraduate program. Enrollment ratios of 20:1 of undergraduates to postgraduates were not unusual rather than ratios of 5:1 to 10: 1 in advanced countries. 2.3 Policy Context. To address problems of economic inefficiency and structural imbalance, the Government initiated a program of reform and adjustment in 1979 which focussed primarily on invigorating China's rural economy. In 1984 the government reaffirmed and consolidated the positive results of the earlier reform and adjustment program and provided guidelines for the direction of a future, primarily urban, reform program. China's objective of quadrupling the gross output value of industry and agriculture between 1980 and 2000 was also reaffirmed in 1984. The 1984 reform plan emphasized the needs for breakthroughs in many areas, and more specifically in upgrading managerial personnel to meet the new demands on them in a reformed economy, and extending utilization of foreign capital, advanced technology and the fruits of scientific research. Reforms in the system of education and training to develop China's human capital potential were recognized to be crucial. 2.4 As an integral element of the reform and modemization efforts, and within the objectives of expanding access to higher education and improving higher education quality, the govemment adopted three principal policies: (a) to expand enrollment especially in graduate programs; (b) to improve teaching and research programs including curricula reform and teacher training; and (c) to improve the system's management. Government policies included expanding enrollment in existing institutions, establishing new institutions, and developing television universities. More specifically, the government policy planned to (a) increase overall undergraduate enrollment at an average rate of about 10 percent per annum between 1983 and 1990, with rates of 14 percent and 8 percent respectively for economic/finance and engineering. Additionally, postgraduate enrollments would rise at a rate of 17 percent p.a.; (b) improve the quality of engineering and economics/finance education in terms of curricula, teachers, experimental work and academic support services; and (c) increase efficiency through improvements in planning and management related to manpower development, the university entrance examination system, physical facilities, resource utilization, project monitoring and evaluation, and emphasizing expansion of enrollment in existing institutions rather than creation of new ones. 2.5 Linkages between Project, Sector and Policy Objectives. In order to address both the sectoral and policy considerations outlined above, the Association and the Government developed a project which laid out the following objectives: (a) to support faster growth of undergraduate and graduate enrollment in engineering as well as economics and finance education; (b) to broaden overspecialized curricula; (c) to accelerate in-service training and promotion of younger faculty; (d) to strengthen experimental work and academic support services such as computer and audio-visual centers and libraries; (e) to improve longer-term manpower planning, facilities planning and university resource utilization; and (f) to strengthen the process of project monitoring and evaluation. In order to support these objectives, the project was to finance (a) teaching and research equipment  - 3 - for project universities; (b) books journals and computer software; (c) technical assistance in the form of specialist consulting services and the support of an international advisory panel; (d) overseas fellowship and faculty exchange programs; (e) teacher training centers; (f) curriculum development, especially in economics and finance; and (g) institutional management seminars and programs. 3. Project Objectives and Descriptions 3.1 Project Objectives and Scope. The project sought to support the first phase (July 1985-June 1989) of the Government's 10-year program (1985-94) to increase high- level technical and managerial manpower through adjustments in enrollment, quality and efficiency related to engineering and economics and finance. To achieve this goal, the project was to implement a program of action on policy and institutional changes which would address three basic issues of the subsector: low level and imbalanced structure of enrollment, inadequate quality, and inefficient planning and management. 3.2 Project Components (a) Enrollment Level and Structure Adjustment. To increase enrollment and redress structural imbalance, the project sought to (i) expand engineering, economics and finance, and graduate education programs at differential growth rates to adjust the imbalance of the overall university enrollment structure in response to development needs; and (ii) give priority in resources allocation to faculties which have stronger implementation and leadership capacity in engineering and economics and finance to create leading centers for training personnel for and from other institutions and related industries. (b) Quality Improvement. To improve quality the project sought to broaden undergraduate curricula in engineering and economics and finance by reducing the number of specialties, increasing the proportion of general and basic courses, and introducing new courses to produce graduates who could meet the demands emerging from the modernization program. In addition, the project aimed at revitalizing the teaching force in engineering and economics and finance by lowering the average age through enforcement of retirement policy, transferring unsuitable staff to nonteaching jobs through the implementation of a displacement policy, accelerating in-service training as well as postgraduate education as the source for new teachers, promoting outstanding young teachers as replacement for retired and displaced teachers. To improve experimentallresearch work as part of the required engineering and economics and finance curricula, existing laboratories and workshops were to be modernized and new ones built with appropriate equipment. Finally, to strengthen academic support services the project would improve libraries, computer centers, and audio-visual centers.  - 4 - (c) Planning and Management Development. Planning and management capabilities were to be increased through improving the Planning and Research Office within the Ministry of Education (MOE). This was to be achieved by introducing new procedures to improve planning and maintenance of facilities; increasing the student/staff ratio, utilization rates of classrooms, laboratories and libraries, and the proportion of commuting students; and establishing a mechanism to monitor and evaluate education development projects by creating a central unit within MOE and local units in individual universities. (d) Studies. The project planned to include studies to introduce new policies on quality and management. The studies were to deal with university quality monitoring and evaluation, student admission, and the management of universities as institutions and as a system. 4. Project Design and Organization 4.1 To assist in the above policy and institutional development objectives, the project contained (a) initially 36 subprojects and then 39 subprojects in about 20 different ministries and central agencies with financing mainly of instructional and research materials, equipment and civil works including furniture to meet the needs of individual universities; and (b) some four national programs with financing primarily for technical assistance to meet the needs of the whole of the engineering and economics and finance subsector. During the implementation of the Project, the new State Education Commission (SEdC) (which in 1982 replaced MOE) and the Association decided to add three more institutions (Fudan, Xiamen, and Nankai Universities) to strengthen the Project's capabilities to work in the areas of economics and finance. 4.2 The subprojects and national programs under the project were prepared, appraised and implemented by the Government, specifically MOE, with selective review by the Association staff. Each subproject and national program was proposed according to mutually developed and agreed upon procedures, criteria and guidelines. The project took a sectoral approach in dealing with such issues as quality improvement and planning an management development. This design element was included to enhance the impact of the project on institutions well beyond the universities which were directly supported by equipment investment. 4.3 Although there were 39 subprojects within in the project, IDA did not include subproject indicators in the SAR which makes it difficult to assess the impact of subprojects on sector or program goals beyond the development of the economics and finance curriculum (see para. 5.13). The apparent inconsistency of a project designed as a sector project but implemented and supervised as a traditional project with focus on strengthening 39 individual universities is borne out by both IDA's and SEdC's gathering and analyzing only subproject-university-data and not sector data. Even SEdC's provision of data at the end of the project reports only subproject data and not sector data. Between design and implementation the sector focus was, by and large, lost. This is,  however, not to say that the project failed to achieve substantial successes but, in retrospect, the project design cannot be seen as totally successful. 5. Project Implementation 5.1 During the seven-year project implementation period (1986-92), IDA's supervision missions reported smooth and successful implementation of the project within subprojects. The only major problem associated with implementation of the project resulted after the events of June 1989 when the dispatch of foreign consultants and specialists was disrupted for a period of some six to nine months. 5.2 The State Education Commission was responsible for monitoring and supervising the implementation of all aspects of the Project. The line ministries (to which the majority of individual Project universities were responsible) each designated a high- level ministry official to oversee Project implementation in those institutions. Each Project university appointed a vice-president to run the Project on its own campus, under the guidance of SEdC and the line ministry. An implementation unit, the "World Bank Loan Office," was established at various administration levels for running the day-to-day work. 5.3 As part of the Credit Agreement between the Association and the Chinese Government, a Chinese Review Commission (CRC) and an International Advisory Panel (LAP) were established in February 1985 to advise SEdC and the Project universities on a broad range of issues involved in the implementation of the Project. The Panel was appointed by SEdC and comprised a chairman and two vice-chairmen, the latter with more specific responsibility in Engineering and Economics, and Finance. The selection of Panel members was made by SEdC based on nominations from the Association, the US National Academy of Sciences, and the chairman of the IAP of the first University Development Project (see paras. 10.1-10.4). 5.4 Civil Works. The civil works were implemented during the early years of the project and covered construction of new buildings and renovation of physical facilities and furniture. New laboratory buildings were built to house the new laboratories and equipment as well as new libraries or addition to old libraries. The civil works were financed with local counterpart funds, implemented by the universities and supervised by the university loan offices established by SEdC. 5.5 Equipment Procurement. The major portion of IDA credit funds was used for equipment procurement. The first phase procurement process started in 1985 with the review of procurement documents prior to project effectiveness by the IAP. This initial review of the procurement documents by the IAP played an important role in facilitating the large percentage of funds disbursed early in the project. The IAP was able to assist the Chinese and IDA in identifying research equipment that was too sophisticated and to encourage the universities to focus on research equipment of intermediate complexity. In addition, the IAP and CRC encouraged the universities to purchase maintenance agreements and undergraduate laboratory equipment appropriate to support teaching  programs. It was felt that undergraduate laboratory equipment was inexpensive, relatively simple, and provided considerable value added toward the effectiveness of undergraduate teaching. The first bidding proceeded smoothly and there was evidence that certain pieces of equipment were not requested as a result of the IAP and CRC reviews. 5.6 The second and third bids also proceeded smoothly. In supervision missions IDA and the IAP reported that many universities had purchased equipment of intermediate complexity and that there were undergraduate labs that were equipped with project funds. 5.7 During the last year of the project there were additional funds accruing to the project through shifts in the SDR/dollar exchange rate. As a result of this accrual, IDA took the advice of the IAP and CRC and recommended to SEdC, in March 1990, that these funds be used for purchases of spare parts, auxiliary equipment, maintenance of project procured equipment, and further training of economics and finance teachers. The project was extended for an additional two years (to December 31, 1992) to complete the procurement and these final purchases did include spare parts, auxiliary equipment, and maintenance. 5.8 Technical Assistance. Increasing the quantity and improving the quality of faculty were two major goals of the Project for both the Chinese government and IDA. The Project sought to achieve these goals by supporting in-service training for existing teachers and training of young people at home and abroad. The Project supported two kinds of in-service training programs. The first worked with the existing stock of mid- level teachers who already had a good background in teaching and research but whose skills needed to be strengthened and updated. The second type of in-service training worked with key, high-level faculty with strong academic and research backgrounds to strengthen the academic and professional leadership of engineering and economics and finance in Project institutions. To reach these goals the Project established two teacher training centers, at Wuhan and Beijing Normal Universities. These two centers reportedly served the faculty development needs of the Project universities as well as the other Chinese universities, and over the life of the project trained more than 2000 teachers. 5.9 The teacher training centers clearly did good work in creating a system to strengthen the teaching skills and disciplinary knowledge of a large number of teaching staff in China's normal universities and colleges. The imaginative array of training programs, extensive information, and training networks reportedly made a difference in upgrading the teaching staff. The impact of the relatively small amount of project funds on this effort has been, by all accounts, catalytic. 5.10 Faculty members were also sent abroad as short-term visiting scholars and longer-term degree-seeking students. The implementation of the fellowships program was consistently ahead of projections. By December 31, 1992, 1,563 short- and long-term fellows (221 visiting scholars and 1342 graduate students) had been sent abroad, more than double the original target of 707.  5.11 Project specialists from abroad were invited to China to lecture and provide technical assistance and advice on research activities and curricula reform. From the start of the Project in 1985 through December 31, 1992, the project was to support 357 international specialists. The project ultimately supported 343 Project specialists from 20 countries and regions in 39 universities. The IAP and CRC have played a vital role in selecting or screening Chinese nominations to assure invitation of the appropriate foreign experts. The LAP and CRC also played critical roles in designing and implementing management seminars in (a) Graduate Admissions Seminar, (b) University Fiscal Management Seminar, (c) Library Automation Seminar, and (d) Engineering Software. 5.12 The project specialists have been sent to China according to four general categories. The first, the Regular Program, supported 232 short-term specialist in engineering and economics and finance who spent up to a month lecturing, consulting, and advising, generally in a specific discipline or subdiscipline. The second, the National Program for Economics and Finance, supported 80 specialists who lectured, advised on curriculum development, taught semester-long courses, took part in economics seminars, and taught both long- and short-term teacher training programs. The third, the Management Seminars Program, supported 17 specialists to give three-week seminars in computer center management, library automation, graduate entrance examinations, and university fiscal management. The fourth, the Teacher Training Centers Program, supported 14 specialists to lecture in specific disciplines to assist in strengthening the in- service teacher training capabilities at Beijing Normal and Wuhan Universities. 5.13 Curriculum Development. In 1987 the project organized an Economics and Finance Curriculum Development Seminar which included participation by international and Chinese experts in the economics and finance area. This seminar recommended the development and introduction of a new minimum core curriculum in the area of economics and finance. This new eleven course curriculum was the first attempt to systematically introduce an integrated modern curriculum to Chinese undergraduate teaching. In March 1990 SEdC recommended that the 250 Chinese universities and colleges with an undergraduate program in economics and finance to use the newly published teaching syllabi and textual materials for the new minimum core courses. With the March 1990 SEdC recommendation to implement the new minimum core curriculum, the initial steps in the modernization of the economics and finance curriculum was completed. This initial phase included the 1987 Curriculum Development Seminar, drafting syllabi for core courses, discussing and finalizing them in a series of domestic and intemational workshops and finally, holding teacher training classes on these syllabi. IDA missions recognized the development and introduction of the new curriculum as the major accomplishment of the project in the area of economics and finance. 6. Project Results 6.1 Enrollment Level. The major objectives of the project-expanding higher education enrollment, improving quality of teaching methods, improving planning and management and carrying out studies related to the other objectives-have been partially achieved. Implementation indicators show that the project met most of its targets and, in  - 8 - many instances, surpassed them (see Table 4). For example, engineering enrollments were 104 percent of the targets and economics and finance were 130 percent. 6.2 Quality Inprovement. The project's support for the creation of a new economics and finance curriculum and the introduction of new and broadening of existing engineering courses was a primary element in increasing the quality of both undergraduate and graduate teaching. Additionally, the increase in the number of faculty with advanced degrees which occurred during the period of the project, many of them degrees achieved by project-supported overseas study, point to the improvement of the quality of the teaching faculty. New research instrumentation and computational equipment have also allowed new teaching and research courses to be developed. 6.3 Planning and Management Development. The project was to introduce a system to monitor and evaluate policy objectives within MOE and subproject universities and to this end foreign investment and loan offices were established at both levels. Staff in these offices received extensive management training and provided ongoing support to IDA and the IAP and CRC in the implementation of the project. 6.4 The project was also able to achieve a somewhat higher level of efficiency within the project with an increase in the student-teacher ratio and utilization of laboratories and libraries. Student-teacher ratio indicators show that targets were not fully achieved during the life of the project although they do show improvement over base line indicators (see Table 4). The average weekly utilization hours for laboratories in project universities increased from 19.5 in 1983 to 65.9 in 1990 and library hours increased from 36 to 75. Although there was an increase in the number of hours that libraries remained open, they fell short of the project target of 90 hours. 6.5 The project sought to increase the enrollment of commuting students from 3 percent to 10 percent. However, due to transportation difficulties, insufficient study areas, and a common perception that the quality of these students was inferior to that of resident students, it was extremely difficult for project universities to reach the targets established by the project. Although they fell short there was an increase to 5 percent. 6.6 Studies. Project supported studies were either carried out by SEdC, or, as in the case of university financial management, turned into an international seminar given by four rectors of German universities. The proposed study on establishing and maintaining university standards was also turned into an international seminar which focused on graduate entrance examination system. Remaining funds in this category were allocated and partially used for a IDA-SEdC workshop on financing higher education which was subsequently canceled because of the events of June 1989. Remaining unspent funds in this category were ultimately allocated to buy spare parts for project purchased equipment.  -9- 7. Project Sustainability 7.1 The planning for the project took place in the early 1980s and was envisioned as the first of phase of a 10-year program to provide China with high-level technical and managerial manpower. The project has helped achieve these goals through project supported training programs and increased enrollments. 7.2 Sustainability of project benefits can be examined in terms of operation and maintenance of equipment and facilities, enrollment, and curricula and faculty development. Shortage of foreign exchange to purchase spare parts and maintenance has hampered the operation of equipment during the life of the project. Some of these problems have been alleviated in the short run with the increase in project funds; however, problems may arise after the maintenance contracts end. 7.3 Enrollments increased rapidly during the first two years of the project because of the increase in the number of institutions of higher education from 805 in 1983 to 1075 in 1992. There was a strong concern on the part of SEdC that this proliferation of new institutions was at the expense of quality in faculty, teaching, and course offerings. SEdC decided that universities could not sustain this level of growth and that they should stabilize undergraduate enrollment by freezing intake of freshman students. The LAP and CRC felt that it is necessary to maintain a balance between the short- and long-term interests and that reductions in enrollments should occur only after a careful assessment of the potential impact on targeted institutions. The project does not seem to have had an impact, positive or negative, on SEdC's decision to freeze university enrollments, one of the major sectoral decisions taken during the life of the project. 7.4 The greatest short-term impact of the project was on curriculum development, especially in the areas of economics and finance. The long-term sustainability of these efforts could be a problem, however, unless there is continued training on new syllabi, institutionalization of a syllabi compilation mechanism, support for textbook-writing, and organization of end-user seminars to identity specific problems in the economics and finance curriculum. In June 1991, the IAP and CRC presented the Chinese government with their final evaluation report which provided specific long-term recommendations for sustainability of the efforts in the development of the an economics and finance curriculum. 7.5 The human resource area of faculty development will have greatest long- term impact. Taking into consideration the continuing problem of the slow return of Chinese students and faculty sent abroad for advance degrees, the best way to sustain faculty development is for Chinese universities to work out effective ways of upgrading and promoting sufficient numbers of younger faculty. 8. International Development Association (IDA) Performance 8.1 IDA played a major role in defining the objectives of both this project as well as its precursor, University Development Project I. Working with Chinese  - 10- counterparts, IDA preparation teams developed a sectoral approach to the second project, one that would focus on strengthening economics and finance as well as engineering in institutions well beyond the direct impact of project universities receiving equipment and technical assistance. 8.2 Since this was a sector loan, IDA focused on sector targets. However, the borrower viewed the loan as a project loan and as a result, focused on achievements in individual project universities, not national level sector impact. The lesson to be drawn from this experience is that a sector designed project can only be successful if the borrower fully understands, designs and implements a project from the start. 8.3 SEdC, working with IDA, established an IAP and CRC, agreed on their terms of reference, and selected highly qualified professors and specialists to assist SEdC and project universities in the implementation of this project. The establishment of an IAP and CRC contributed substantially to the overall effectiveness of implementation. IDA staff fully cooperated with the IAP and CRC. Difficulties with technical assistance, equipment and book procurement, and other project components were discussed and resolved at semi-annual meetings between the IAP, CRC and IDA. 8.4 The IAP and CRC felt IDA, in the initial design of the project, had not paid adequate attention to the issue of maintenance agreements for the newly purchased-and highly sophisticated-equipment supported by the project. However, close to project completion, IDA did insist that a substantial part of the funds available in the project as a result of the shifts in the SDR/dollar exchange rate be used for maintenance costs associated with the sophisticated research equipment purchased with project funds. 9. Borrower Performance 9.1 The performance of SEdC and the project institutions was excellent, particularly with regard to equipment and book procurement and technical assistance. SEdC drew from their experience with the first university development project in equipment and book procurement and technical assistance and passed it on to the project institutions. 9.2 During the implementation the staff of the Foreign Investment and Loan Office (FILO), SEdC, coordinated the project institutions in procurement and installation of equipment, the technical assistance programs, and preparation of annual progress and audit reports sent to IDA. They collected the necessary data for project preparation, implementation, and completion. 9.3 The Borrower fulfilled its commitment in providing counterpart funds for civil works and the project institutions were able to complete the civil works in time to install the imported and locally procured equipment. However, the allocation of recurrent costs was a problem.  - 11 - 10. Consulting Services of the IAP and CRC 10.1 The LAP and CRC were formed by SEdC and IDA during the preparation stage of the project and consisted of prominent professors and specialists. The IAP and CRC played a major role in project implementation and evaluations. The members and the Secretariat, that supported the IAP, were fully dedicated to the project operations. 10.2 Members of the IAP and CRC and staff of the secretariat visited all project universities to discuss project implementation, to provide advice on a broad range of issues including curricula reform, and to monitor progress. In addition, the IAP and CRC held nine policy review meetings attended by IDA staff and SEdC and other concerned Chinese officials. The meetings discussed a broad range of implementation issues such as equipment procurement and recurrent costs, curricula development, and effective implementation of technical assistance. The last joint policy meetings resulted in a detailed evaluation report, some of which is reflected in this report. 10.3 The IAP played a lead role in the planning and development of the economics curriculum development seminar. It offered many important recommendations to SEdC and the project universities on the overall implementation of the Project. The IAP also played a critical role in sustaining the implementation of technical assistance after the events of June 1989 brought a lengthy hiatus to sending international consultants to China. In addition, it provided a valuable link between the Chinese academic community and the international scientific community. 10.4 The IAP and CRC through their joint policy meetings and site visits, provided substantial supervisory assistance, albeit informal, to the Bank. The role of the LAP and CRC was judged by the Bank to be extremely valuable in the overall supervision of the project. 11. Project Documentation and Data 11.1 Staff Appraisal Report and Other Working Documents. The SAR was prepared as a result of sector work by the Bank Group and feasibility studies carried out by SEdC. The report clearly defined the project objectives and components and provided guidance for project implementation. Cost estimates were relatively accurate. By the end of the project period changes in the foreign exchange rate allowed for an increase in the equipment and technical assistance procurement within the originally planned scope of the project. 11.2 On the other hand, the accuracy of project financing is difficult to determine because the overall financing was defined in terms of the entire engineering and economics sector over the five year project period. The SAR did not provide counterpart financing data for subprojects and since the borrower collected financial data for a project style loan (not a sector loan) a comparison of counterpart funds cannot be made (see Table 6).  - 12 - 11.3 The SAR only provides sectoral targets. Without subproject targets to evaluate the implementation of the project, there is difficulty in assessing any meaningful project impact on the sector goals. This is more so the case when at project completion only subproject data, or aggregates of subproject data are provided for review. These inconsistencies indicate a mismatch during the design period between IDA and borrower goals and perceptions of the project. The sector approach for project design, useful for understanding and diagnosing the issues on which the project should focus was less successful in providing an appropriate mechanism for implementing and supervising the project. 11.4 Evaluation Data. The evaluation activities of SEdC, the LAP, and CRC were based on sample site visits and a select group of qualitative criteria. The IAP and CRC visited 22 sample universities and gathered data according to their criteria. The results of SEdC, the IAP, and CRC investigations were reported in a comprehensive evaluation report that was prepared during the final joint policy meeting in November 1990. The final report was presented to Li Tieying, the Minister of Education, on June 19, 1991. 12. Lessons Learned 12.1 The main lessons learned from the project experiences are: (a) Reform of the Chinese higher education sector is most possible within a supportive policy environment in which all participants, both within and outside the education sector are in fundamental agreement on the scope, pace and direction of reform. The project's economics/finance core curriculum work was only possible because a political consensus existed in China in 1985/86 at the start of the project, which supported the view that only by reforming the economic system could China achieve sustained growth. The Chinese government recognized that to reform the economy it must change the way it trained its economists and administrators. This consensus existed in all sectors of the economy and throughout the government and facilitated the rapid development of the curriculum. (b) Implementation of a project designed as a sector loan is possible only if there is an understanding on the part of both the borrower and IDA as to how a sector project is designed, developed, and implemented. In this case, the borrower, from the beginning, viewed this loan as a project loan and as a result, implemented and assessed the project on this basis. Likewise, IDA did an inadequate job of working with the borrower to fully explain the differences between and reasons for sector and project loans. This confusion from the very beginning resulted in a credit-supported activity which was described as a sector loan with sector goals but was implemented as a project loan with subproject goals. Accordingly, impact of the project on the overall sector goals (i.e., enrollment, quality and management) is  - 13 - difficult to assess because they were not monitored by either the borrower of IDA during project implementation. (c) The sector approach to project development was not totally a loss but was successful only when the project's impact on the economics and finance curriculum is taken into account. The new curriculum affects 250 institutions, well beyond the nine economics and finance institutions actually supported in the project. The lesson to be drawn from this experience is that sector designed projects can only be successful if the borrower fully understands, designs and implements a sector activity from the start. This includes providing project targets that can be used to realistically evaluate success in implementing policy action plan goals. Confusion between IDA and the borrower on the fundamental goals (and thereby the targets) of a project makes the project difficult to assess. (d) The program approach to project design was a useful method to analyze and assess national issues and propose national solutions. In light of the development of a national economics and finance curriculum which continues to be developed and taught well after project completion, the program approach has some merit. However, IDA and the borrower must both agree on how a program approach can be used to support sustained policy development over a period of time and through small projects. This has not been the case in IDA's continuing work in higher education in China. (e) The international technical assistance in education projects can provide vital and important educational inputs into a reform process which is underway and is fully supported by the educational policy structure. Major changes in economics and finance curriculum were possible for these reasons. International impact on the engineering curriculum was not as evident, primarily because it was felt by Chinese university administrators and academics that fundamental change in this sector was not critically necessary. The role of the IAP and CRC in preparing, implementing and evaluating education projects in China has been important. Both IDA and the Chinese government have recognized their importance. (f) Continuing efforts should be made to include maintenance contracts with the purchase of sophisticated equipment. Capacity to operate and maintain these major investments should be a main concern.  - 14 - PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE A. COMMENTS ON THE ANALYSIS IN PART I 1. The Borrower recognizes that the descriptions and the analysis of the background, objectives, design, implementation and results of the project CUDP II contained in Part I, by and large, conform to the actual situation. It also agrees with the comments and recommendations presented in the Evaluation Report by the IAP and CRC, which seem to have no substantial difference from those given in Part I. 2. As indicated in Part I, the Chinese government placed within the education sector a priority upon the rapid expansion and improvement of higher education to help reduce the manpower constraints on national development in two dimensions: the low level of overall enrollment and the imbalance of enrollment structure in higher education. In 1980, the Borrower approached the World Bank proposing an a9sistance plan to strengthen Chinese higher education. The proposal was more extensive than the Bank could consider at that time, so the Borrower decided to stage the programs over a prolonged period of time. Accordingly, MOE [reorganized as the Stated Education Commission (SEdC) in 1985] of the government, working with the World Bank, initiated the first university project (CUDP I) to strengthen science and engineering programs in 28 national level key universities. While it was implemented, IDA and MOE began program work on the project CUDP II in 1983. Immediately before it became effective in mid- 1985, the government announced a "Decision on the Reform of the Educational Structure," which brought about a wide range of educational policy changes to further adapt the national economic reform and development. It was this major reform of the higher education system that set the stage for the CUDP II. 3. The project CUDP II, following the successful experience of the preceding projects, was at first devised as a "project loan" to support the development of about 35 higher education institutions in engineering and economics/finance subsector. Later at appraisal, however, MOE agreed with the recommendation of IDA in dialogue to modify the design to make the project as a "sector loan." At the request of IDA, MOE delivered a signed letter of policy to it, describing the sectoral goal, policies and a program of action for the development of the engineering and economics/finance education subsector and declaring the Borrower's commitment to the execution of the action program. This goal and the program of action were further briefed in the SAR and repeated exactly in Part I of the PCR. 4. Yet there were new problems in the process of project design. It was the first time for the Borrower's project implementing agencies in differential levels to manage  - 15 - a "sector loan," hence, they were unfamiliar with it all. Moreover, MOE, being a functional department of the central government, has only the authority to coordinate implementation and recommend reform of the national education policies, but cannot directly control the administrative management of the majority of higher education institutions. Furthermore, the credit proceeds of the project was allocated only to finance directly 36 (later increased to 39) subproject institutions and some national programs. Therefore, the other nonsubproject universities in engineering and economics/finance subsector would not accept the assignment to implement as project institutions, though they would benefit from the impact of the project. MOE had inquired of IDA about the guidelines of implementation of a "sector loan," yet no adequate explanatory and guiding document but the SAR of the project was available. As a result of consultation with IDA in dialogue, they were instructed: (a) the regular supervision missions of IDA and the field visits of the IAP, and CRC might not cover the nonsubproject institutions of engineering and economics/finance education; (b) the annual progress reports and the audit reports of the project might focus their contents on the subprojects and the national programs; (c) a table of "performance target" indicators was attached to the SAR (Annex 15) and had to be filled at mid-period and completion of the project and should be demonstrated by sectoral indicators; and (d) any change of programs of action and target indicators related to sectoral goals should be approved by IDA before implementation. The actual exercises did accord to the above demands. However, the inconsistency of the project in design and in implementation seems inevitable and having no alternative. The impact of the project on sector goals were indeed difficult to be assessed, not only because of the confusion resulted in a credit-supported activity described as a "sector loan" but implemented more or less as a "project loan," but also because of the complicated situations of the project components. 5. The Borrower acknowledges the conclusion given in Part I based on the reports of IDA supervision missions that the project implementation within the subproject had run smooth and successful. It also deems that the brief descriptions of the project implementation contained in Part I are sufficient to affirm the above conclusion, and no more points but a few clarifications have to be added as supplements. Besides, it should be noticed that over 90 percent of IDA credit and about the equal amount of counterpart local funds was allocated to support the subprojects for procurement of civil works, equipment and teaching and research materials, as well as technical assistance and fellowships. 6. Building on the successful experience of the preceding projects, the Borrower and IDA decided to create an IAP and a CRC to advise on implementation of the project. As a further step in this case, the decision had been written into the Credit Agreement as a part of it. The excellent performance of the IAP and CRC in playing their roles had once more offered evidence of the correctness of the decision. The Borrower would like to highly appreciate the contribution of the two organizations in advising the project implementing agencies and the project institutions, coordinating and directing the activities of the project specialists, and especially in this sectoral project, designing and facilitating implementation of the national programs.  - 16 - 7. The organization of an Economics and Finance Curriculum Development Seminar and thereby the development and introduction of a new undergraduate minimum core curriculum in the area of economics and finance was an unexpected action beyond the original design of the project. In view that the core curriculum had been recommended by SEdC for use in Chinese universities and colleges, it may be recognized as a major accomplishment of the project. Of course, this is not the only achievement. The project also supported for the introduction of the new and broadened engineering courses as well as decrease number of specialty from 500 to some 200, yet the outcome and impact of the latter were smaller because of the wide range and complex structure of the engineering subsector. 8. Being designed as a sector loan and containing some national programs with financing mainly for technical assistance, the project had placed priority upon the specialist services in the project implementation. Thanks to the assistance from the IAP and CRC, the nomination and invitation of the project specialists and the coordination of their work were implemented smoothly in most cases. After the events of June 1989, though the Chinese government made great efforts to eliminate its negative effect, some specialists were still affected by possible misunderstandings and hesitated traveling to China. Anyhow these were over quite soon, and over 95 percent of the invited specialists had carried out their promise to China. As a whole, it seems not a major problem. B. ADEQUACY AND AccuRAcY OF FACTUAL INFORMATION IN PART m 9. Part III of the PCR contains nine tables of statistical information about the evolution and implementation of the project. The Borrower deems that, on the whole, they are adequate and accurate sufficiently for illustrating the major elements relating to the general state of the project. Maybe some supplement or modification to them would make the illustration more complete and understandable. (a) For Table 4, "Implementation Indicators," a few footnotes should be added for clarification. (b) Also for Table 4, it would be interesting for someone to add a table of indicators collected from each of the project institutions. Most of the data had been ready for use. (c) In Table 6, "Project Financing," the two groups of data under the titles "Appraisal Sector Amount" and "Actual Project Amount" are not accounted along the same lines. It would be better to turn the first group into "Projected Sector Amount." C. EVALUATION OF IDA'S PERFORMANCE 10. IDA officials participating in the preparation and appraisal of this project were not only highly professional and qualified with their task, but also quite enthusiastic and sincere in their work. Since many of them had cooperated with the Chinese counterparts in two preceding projects, they were already familiar with the working situation of the Chinese education projects and the working style of MOE/SEdC staff. Although this is the third project of cooperation between IDA and MOE/SEdC, and the first project had just began its implementation in two years, IDA management and officials had already full confidence in the ability and experience of the Chinese staff, so they encouraged the Borrower to design and implement the project as a "sector loan." IDA  - 17 - staff also closely cooperated with the IAP and CRC, attended their joint policy meetings, curriculum development in finance/economics area and other programs. D. EVALuATION OF BORRowER's PERFORMANCE 11. Although MOE had gained certain experiences in the implementation of the preceding projects, it was unfamiliar with a project focusing on sectoral objectives. Moreover, most of the project institutions and their related line ministries had even no experience at all in dealing with an IDA-supported project. However, thanks to the enthusiasm and diligence of the staff of the project participants, most of the difficulties had been overcome in the period of implementation. Some relating departments of MOEISEdC also played vital roles in organizing and holding the seminars or studies in national programs which made impact on the sectoral goals of the project.  PART mII: STATISTICAL INFORMATION 1. Related Bank/IDA Loans and/or Credits Year of Loan/credit title approval Purpose Status Managed by University Development Project 1981 The project sought to strengthen science & engineering in 28 completed 1987 SEdC (Ln. 2021-CHA, Cr. 1167-CHA) leading Chinese Universities. Objectives were to increase the quality & quality of graduates & research, to strengthen the planning & management capabilities & to prepare investments in the education sector. Agriculture Education and 1983 The project was designed to assist agriculture higher education completed 1988 Ministry of Research Project and research in 11 agricultural colleges and 7 institutions. Agriculture, (Cr. 1297-CHA) Animal Hus- bandry and Fishery Polytechnic/Television Univ. 1984 The project sought to increase the number of students & to completed 1989 SEdC Project improve the quality of instruction in China's 17 Polytechnic (Cr. 1441-CHA) Institutions & 28 television Universities. Rural Health and Medical 1984 The education component of this project was designed to completed 1989 Ministry of Education Project enhance the quality of education, training & curriculum. Public Health (Cr. 1472-CHA) Second Agricultural Education 1984 The project sought to improve & assist agriculture education in completed 1991 Ministry of Project 23 agricultural colleges, 12 agrisultural technical schools. Agriculture, (Ln. 2444-CHA) Animal Hus- bandry and Fishery Provincial University Project 1985 The project was to provide direct assistance to 60 provincial completed 1991 SEdC (Cr. 167 1-CHA) universities in 28 province and planning assistance for the higher education subsector. ... continued  1. Related Bank/IDA Loans and/or Credits (cont'd) Year of Loan/credit title approval Purpose Status Managed by Gansu Provincial Development 1988 It is part of a comprehensive plan to attain universal nine-year to be completed Gansu Pro- Project-Education Component basic education and to improve the quality of instruction in in 1993 vincial Gov- (Ln. 2812-CHA, Cr. 1793-CHA) prinary and lower secondary schools in Gansu Province. ernment Teacher Training Project 1989 To promote universal basic education through the expansion to be completed SEdC (Cr. 1908-CHA) and upgrading of in service training for lower secondary school in 1994 teachers. Textbook Development Project 1989 The project supports the textbooks upgrading program by the to be completed SEdC (Cr. 2006-CHA) Chinese Government. Objectives are to improve the educa- in 1995 tional quality of textbooks at al levels of schooling, to increase the variety of available textbooks & to improve the efficiency of textbook production. Vocational & Technical Education 1990 To improve the quality of technical & vocational training in to be completed SEdCC Project China through supporting 59 secondary v/t schools in 1 prov- in 1995 (Cr. 2114-CHA) inces and 3 municipalities. Medium-sized Cities 1990 The project assists the Changzhou, Luoyang Shashi cities to to be completed SEdC Development Project improve overall and sector planning and management, includ- in 1995 (LN. 3286-CHA) ing education. Key Studies Development Project 1991 The project supports the government's plan to reform the to be completed SEdC (CR. 2210-CHA) management of science and technology programs. It consists in 1995 of support for research and graduate training in 133 State Key Laboratories and Special Labs affiliated with Universities and with Chinese Academy of Sciences. Education Development in Poor 1992 The project supports three main goals for the development of to be completed SEdC Provinces education in relatively poor provinces-Shanxi, Shaanix, in 1996 (CR. 2339-CHA) Hubei, Hunan, Guijhou and Yunan. Effective Teaching Service Project 1993 The central aim of the project is to contribute to improved to be completed SEdC (CR. 2471-CHA) learning at the lower middle school level by providing teaching in 1998 services, including instructional methodology, teacher training and management of teacher training and assignment.  - 20 - 2. Project Timetable Item Date planned Date revised Date actual Identification 12/1981 - 1/1983 Preappraisal 6/1983 - 9/1983 Appraisal mission 2-3/1984 - 2-3/1984 Negotiations 1/1985 - 1/1985 Board approval 2/26/85 - 2/26/85 Credit signature 3/15/85 - 3/15/85 Credit effectiveness 6/12/85 - 6/12/85 Project completion 12/31/89 12131/91 12/31/92 Credit closing 12/31/91 12/31/92 12/31/92 3. Credit Disbursement ($ million) IDA FY 1985 1986 1987 1988 1989 1990 1991 1992 1993 Total Appraisal estimate 0.0 1.5 27.5 43.5 36.5 29.0 7.0 0.0 0.0 145.0 Cumulative as % of total 0.0 1.0 20.0 50.0 75.0 95.0 100.0 0.0 0.0 - Actual disbursement 7.7 25.4 76.6 21.0 8.2 32.0 7.1 11.0 1.0 190.0 Cumulative as % of total 4.1 17.5 57.8 68.9 73.2 90.0 93.7 99.5 100.0 - Date of final disbursement: 2/93  - 21 - 4. Implementation Indicators Indicator Appraisal national targets 1983 1990 1990 % actual target actual of target Engineering Intake 131,000 215,000 208,285 97% Output 111,000 180,000 195,841 122% Enrollment 418,000 720,000 745,613 104% Economics/Finance Intake 29,000 68,000 64,446 95% Output 13,000 50,000 66,380 133% Enrollnent 71,000 170,000 220,494 130% No. of Specialty Areas Engineering 500 200 204 Economics/Finance 51 30 31 % of Specialized Courses Engineering 15 10 no data Economics/Finance 20 15 % of Experiments Performed Engineering Basic Training 69 80 84.6 Specialized Training 60 72 84.3 No. of Total teachers recruited, transferred, and retired Engineering Total teachers 104.5 102.9 180.5 Recruited 6.9 9.2 Transferred 0.7 2.8 Retired 0.7 2.8 Economics Total teachers 11.8 17.0 19.2 Recruited 0.8 1.5 Transferred 0.1 0.5 Retired 0.1 0.5 Teacher/Student Ratio Engineering 1:4 1:7 1:5 Economics/Finance 1:6 1:10 1:7 Average Age of Staff Eng/Econ/Fin 45 40 no data Faculty Development: National: % of Faculty with Ph.D., Master's or equivalent Eng/EconlFin 17 30 50 % of Commuting Students Eng/Econ/Fin 3 10 5  - 22 - 5. Project Cost ($ million) Appraisal estimates Actual Component IDA IDA Civil works 0.0 0.00 Equipment 108.0 170.40 Specialists services 4.0 7.30 Exchange programs 1.0 .30 Fellowships 12.0 12.00 Future project, planning studies 4.0 0.02 Other 16.0 0.00 Total- 145.0 190.02 6. Project Fnancing (in $ million) Source Projected SAR amounts Percent- Actual project amounts Local Foreign Total age Local Foreign Total Government 698.0 319.0 1,017.0 87.5 188.8 - IDA - 145.0 145.0 12.5 - 190.02 - Total 698 4L4,Q 1.162.0 100.0 188.8 190.02 378.82  - 23 - 7. Status of Covenants for the Second University Development Project Credit Deadline agreement Subject compliance Status Section 2.02 (b) The Borrower shall maintain in dollars a special account effectiveness compliance in a Bank acceptable to the Association. Section 3.01(a) The Borrower's commitment to fulfill the project objec- effectiveness compliance tives, to carry our the Project through MOE with due diligence and efficiency and in conformity with appropri- ate administrative, financial, and education practices and to provide the need funds, faciLities, services and other resources required for the project. Section 3.01(b) The Borrower shall maintain the Central Coordinating effectiveness compliance Committee established for the purposes of the Project and should include representatives from MOE, Ministry of Finance, and State Planning Commission. The Bor- rower shall also maintain the Chinese Review Commis- sion and the International Advisory Panel established for the purposes of the Project, including experts in engi- neering, economics and finance, with functions and responsibilities acceptable to the Association. Section 3.02 The Borrower shall employ consultants whose qualifica- effectiveness compliance ions, experience and terms and conditions of employ- ment shall be satisfactory to the Association, such con- sultants to be selected in accordance with principles and procedures satisfactory to the Association on the basis of the 'Guidelines for the Use of Consultants by World Bank Borrowers. Section 3.03(a) The Borrower undertakes to insure to make adequate during project compliance provision for the insurance of imported goods to be implementation financed out of proceeds of the Credit against hazards incident to the acquisition, transportation, delivery, and installation. Section 3.03(b) The Borrower shall insure that all goods and services during project compliance financed out of the Credit be used exclusively for the implementation purposes of the Project. Section 3.04(a) The Borrower shall furnish the Association with the during project compliance plans, specifications, reports, contract documents and implementation work and procurement schedules for the Project. Section 3.04(b) The Borrower shall maintain records and procedures during project compliance adequate to record and monitor the progress of the Proj- implementation ect; shall enable the Association's representatives to visit the facilities and construction sites and to examine the goods financed out of the proceeds; and shall furnish to the Association at regular intervals information on cost and, where appropriate, benefits to be derived and the goods and services financed out of the proceeds. Section 3.04(d) Promptly after completion of the Project, the Borrower 12/31/92 compliance shall prepare a report for the Association on the execu- tion of the Project, its cost and the benefits derived, and the accomplishment of the purposes of the Credit. Section 3.05 The Borrower shall acquire when needed aU land and during project compliance rights as required for carrying out the Project, and shall implementation fumish, upon request, satisfactory evidence to the Asso- ciation. continued  - 24 - 7. Status of Covenants for the Second University Development Project (cont'd) Credit Deadline agreement Subject compliance Status Section 3.06(a) The Borrower shall allocate the proceeds of the Credit during project compliance for subprojects and National Programs. implementation Section 3.06(b) Select subprojects. effectiveness compliance Section 3.06(c) Appraise and approve National Programs and subproj- effectiveness compliance ects. Section 3.07 The Borrower shall award fellowships under the Project during project compliance in accordance with selection criteria and procedures implementation agreed with the Association. Section 3.08(a) The Borrower shall carry out studies in accordance with during project see para. 6.1 terms of reference and schedules acceptable to the Asso- implementation ciation. Section 3.08(b) Upon completion, prepare summary and analysis of the during project see para. 6.1 findings of the studies. implementation Section 4.01(a) The Borrower shall maintain records in accordance with effectiveness compliance appropriate accounting practices Section 4.01(b) The Borrower shall maintain separate accounts reflecting during project compliance all expenditures on account of which withdrawals are implementation requested from the Credit Account on the basis of state- ments of expenditure; retain all records for one year after the Closing Date; and enable the Associations representa- tives to examine the records. Section 4.01(c) The Borrower shall have accounts audited each fiscal during project compliance year; supply the Association with certified copy no later implementation than eight months after the audit; furnish the Association with information on accounts, records and expenditures when requested. Section 4.02 The Borrower shall cause facilities and equipment pro- during project compliance vided under the Project to be operated, maintained, implementation renewed and repaired in accordance with sound adminis- trative, financial, engineering and educational policies and practices. Section 4.03(a) The Borrower shall monitor the progress achieved in during project compliance carrying out the Action Program. implementation Section 4.03(b) To assist in carrying out the monitoring and evaluation during project compliance the Borrower shall maintain the central monitoring unit implementation within MOE and the local monitoring unit with each subproject institution. Section 4.03(c) The Borrower and the Association shall hold comprehen- during project compliance sive annual joint reviews by November of each year to implementation evaluate progress in Project implementation. Section 4.03(d) The Borrower and the Association shall also hold a com- 11/30/87 compliance prehensive mid-term joint review by November 30, 1987. Section 4.04 The Borrower shall maintain the Central Coordinating effectiveness compliance Committee; the Chinese Review Commission; and the International Advisory Panel.  - 25 - 8. Staff hiput (staff/weeks) hem 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 Toad Preappraial 6.0 16.2 17.1 - - - - - - - - - - 39.3 Appraird - 5.6 62.1 - - - - - - - - - - 67.7 Negofistioa - - - 7.7 - - - - - 7.7 Superviion - - - 7.3 11.4 4.2 9.3 5.5 7.2 9.0 6.6 - - 60.5 PCR - - - - - - - - - - 1.5 2.0 2.0 5.5 Odiar - - - - - - - - - - - - - - TOW 6.0 21.8 79.2 15.0 11.4 4 2 _ S.S 7.2 9.0 8.1 2.0 2.0 180.7 9. IDA Missions Sage of Project Mooth/ Number of Number of Number of Performance rating year missions peorons days and specialization Type of problem Idenfificafion 1/83 2 2 20 Ed spt PrapRai 9/83 1 3 7 Ed ps, colmang. Apprail 2/84 1 4 26 Ed ap, tch ed, chem -aed, eco/mng. - Podami-I 6/84 2 3 12 Ed aps, tch ad - Sup-rvison 3/85 1 2 7 Gen ed, tch ed no major problems 11185 2 2 11 Geaed,tched nomajorproblems 9/86 1 2 17 Ges e4 tch od oo rjorp prbima 10186 1 1 21 econ no major problems 7/U 1 3 17 Gen ed, tch ed, r.econ no major problems 7/89 1 1 4 enaed Evers of6ll9 3/90 1 2 9 gan ed, r. econ no major problem 10190 1 2 22 gem ad, r. econ no major prob_en. 4/91 1 2 20 gem ad, tch ad no major proble 9/92 1 1 5 gmn ed pcr diwusuions   MAP SECTION   IBRD 26959 '50- 70; ' o80' 90 0 o0, 120',.-"_ 130' 1o0- RUSSIAN -- \AZAKHSTAN .?K...-.. FEDERATION i KAZAKHSTAN _ 2 f , / S -- Horbin f\;,, MONGOLIA - i ! >- > ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~l rCongchun - A m~- 4V ~\. KYRGYZ Nt Uurns K REPUBLIC J ' 1_ M\ONNGOL -N Snyang of JAPAN >TAJIKISTAN - R/. DEREJl. OOE Hohh.rot .SE/JINCS Tun_F KOREA ..r-- .- N r j v r J HEBEI (2 TIA \l SHI5 REP OF O - \ - \ \ ) lnhrin}| Tlycn SIIch ng Z _fn/el KC;REA'_- . The boundarie-s colors. de\onninations - jGANSU) i o / sbrliouhuoeo .KOREA_ andony oher ifSormation sioon on s T :iiot, u S-e Te mop do rat i cmply. on Ire port of -h r-xJ S or ha legal stanuaotony territory. o,r < "nnty;Lx - -A- SA ^ . '\ C',, ~ any-end--serneat or onpor o ouch o-' - a- ' 3 zn OINnHAl( L J -30 ~ ~~~~~~~~~ ~~~~~~~~~ ) _ e" _ >~~ ~ ~~~~ C Chegd jZhongahou4mNn Hesz5 .' HENAZN S - - Est China Hef6~~~~~e ~ . ~N ' Hafe\j0 Shanghai NEPAL K,: P IHAN-1 (. Nonchang . L 8 Chengshe ' ,h-g (D SICHU\ AN,' uao~OCA SECOND UNIVERSITY < > L onr ho- ? J;ANG.--- PACIFIC A 1 - ~~~~~~~~~HUN,;N Fzo-OCEAN CHINA ' \I/NAN SECOND UNIVERSITY j r- ) GUIZHOU ___ DEVELOPMENT PROJECT Kg CL,''C9s - CYa- A \SUNNAN k E ~~~GUANGXI / G-sg h-' ~ ~ C1Ui 0 S Prooinca Capitls - - Procince Boundaries 'NA K N-n-/g / Gnh Sea Natmanal Capital - - International Boundanien g Nni L\SHONG KONG, U K. z L1.<! VIET NAM '-a, Po.t. KliOMETERS 0 200 400C 600 900 VIET MILES 0 100 200 300 U00 500 -70u i) LAO PEOPLE'S .PHILPPINES -7 DEM.REP''' THAILAND ) N HAINA.\3 4/21/1995 E TI3 i 234oabo    IMAGING Report No: 14530 Type: PCR