Zambia - Second Technical Assistance Project

Docu3ment of The World Bank FOR OFFICIAL USE ONLY Report No. 14502 IMPLEMENTATION COMPLETION REPORT REPUBLIC OF ZAMBIA SECOND TECHNICAL ASSISTANCE PROJECT (TA II) (CREDIT 1679-ZA) MAY 5, 1995 Macro, Industry and Finance Division Southern Africa Department Africa Region 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 Unit = Kwachal Feb. 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 US$1.00 = 7.79 8.89 8.82 12.90 28.90 61.70 171.00 452.76 700.00 830.00 Fiscal Year January I to December 31 ABBREVIATIONS AND ACRONYMS GRZ Government of the Republic of Zambia ICB International Competitive Bidding IDA International Development Association MOF Ministry of Finance NCDP National Commission for Development Planning NCZ Nitrogenous Chemicals of Zambia NIPA National Institute of Public Administration PIP Public Investment Program PIRC Privatization and Industrial Restructuring Credit PSRP Public Sector Reform Program PTC Posts and Telecommunications Corporation RVP Regional Vice President UTH University Teaching Hospital ZCCM Zambia Consolidated Copper Mines ZIMCO Zambia Industrial and Mining Corporation Annual average exchange rate (Kwacha per U.S. Dollar) February figure is end-of-period rate.  FOR OFFICIAL USE ONLY TABLE OF CONTENTS PREFACE EVALUATION SUMMARY ii PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE I A. Background I B. Statement of Objectives 2 Macro-economic Analysis 2 Financial Management 2 Budget and Revenue 3 Training 3 Parastatal Reform, Privatization and Public Sector Management 3 C. Achievement of Objectives 3 Project Design and Organization 4 Project Implementation 4 Studies 6 Consultants 6 Training 7 Equipment 8 D. Major Factors Affecting the Project 8 E. Project Sustainability 9 F. IDA Performance 9 G. Borrower Performance 10 H. Assessment of Outcome 10 I. Key Lessons Learned 12 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  TABLE OF CONTENTS Cont'd PART II: PROJECT REVIEW FROM BORROWER'S PERSPECTIVE 14 PART III: STATISTICAL INFORMATION 15 Table 1. Summary of Assessment 15 Table 2. Related Bank Loans/Credits 16 Table 3. Project Timetable 17 Table 4. Loan/Credit Disbursements: Cumulative Estimated and Actual 18 Table 5. Key Indicators for Project Implementation 19 Table 5A. Key Indicators for Project Implementation (modified indicators) 20 Table 5B. Key Indicators for Project Implementation: training (actual) 21 Table 6. Studies Included in Project 22 Table 7A. Project Costs 23 Table 7B. Project Financing 23 Table 8. Status of Legal Covenants 24 Table 9. Bank Resources: Staff inputs 25 Table 10. Bank Resources: Missions 26  FOR OFFICE USE ONLY CONFIDENTIAL PREFACE This is the Implementation Completion Report (ICR) for the Second Technical Assistance Project (TA II) for Zambia, for which Credit 1679-ZA in the amount of SDR 7.3 million (US$8.0 million) was approved on April 1, 1986 and made effective on August 26, 1986. The dollar equivalent had risen to US$10.4 million by April 30, 1995 due to movements in the exchange rate between the dollar and the SDR. Of this amount, a total of approximately US$8.5 million or 81.7 percent had been disbursed, leaving an undisbursed balance of approximately US$1.9 million. The SDR equivalents are 6.1 million and 1.2 million respectively. The entire undisbursed balance of US$1.9 million was canceled effective April 30, 1995. The original closing date for the IDA credit was December 31, 1992 with two extensions to December 31, 1994 when it finally closed. The ICR was prepared by Gilbert Patrick Uwujaren, Consultant, and Lemma Merid, Task Manager, AF 1 MI, Southern Africa Department. During an ICR mission, which visited Zambia in February 1995, the original draft was shared with the Borrower which was in agreement with the Bank's views and elected not to write a separate report (Part II) but proposed revisions for a joint report. This Report incorporates the Borrower's suggestions and Part II contains the Borrower's letter to that effect. Preparation of this ICR is based on a review of the documentation in the project files, including the President's Report, The Development Credit Agreement, Project Supervision Reports, correspondence between IDA and the Borrower, internal IDA memoranda, interviews with IDA staff involved in the implementation of the project, and interviews with Borrower's staff and beneficiaries in the field during the ICR mission to Zambia in February 1995.   EVALUATION SUMMARY Background and Objectives I. This project was identified in the early 1 980s when Zambia was undergoing a period of acute economic and financial crisis precipitated by the secular decline in copper prices that started in 1975. Key ministries and institutions lacked the macroeconomic analytical capacity and administrative machinery to support needed reform. This project was the second among the self-standing technical assistance (TA) projects, which were approved in 1978 and 1986 and were designed to address these capacity issues. The first was designed to improve the planning and project preparation capacity of government. The development objectives of the second TA project were to improve: the capacity of government to carry out macroeconomic analysis; the planning and budgeting systems to make resource allocations more responsive to government policies and objectives, and management and accounting skills and the availability, speed and accuracy of essential management information. In June 1991, concurrently with a resumption of disbursement after a four year suspension, the project's objectives were expanded to include support of parastatal reform. privatization and public sector management. The attainment of these goals would contribute to macroeconomic stability, restoration of growth, and to structural changes and indeed long-term sustainable development. 2. These objectives were to be achieved through support in the following areas: strengthening the National Commission for Development Planning (NCDP) in carrying out macroeconomic analysis by providing consultants and equipment; strengthening the Data Processing Unit in the Ministry of Finance (MOF) in designing and implementing a computerized financial management system; strengthening the MOF in budget analysis and revenue estimation and forecasting through provision of technical assistance and equipment; training Zambians both on-the-job and through short- and long-term courses and seminars; and by providing assistance in parastatal reform, privatization, and public sector management. Achievement of Objectives 3. The World Bank rates the achievement of the objectives in respect of institutional development and public sector management as partial, and in respect of private sector development (as well as privatization) as negligible mainly because of implementation problems and the lack of sustainability of much of what was implemented. Some improvement in capacity to carry out macroeconomic analysis has taken place in Zambia, partially' as a result of this project, and the short- and long-term training it provided. But this is still a far cry from what is required, so that continued technical assistance in this area is needed. There have also been marginal improvements in public sector  ii management, the planning and budgeting systems, resource allocation, as well as in management and accounting skills. But a lot more needs to be done in this area. By contrast, private sector development and privatization effort has lagged considerably. Implementation and Project Results 4. The project faced several implementation problems. First, the agency responsible for implementation, the Loans and Investments Department of the Ministry of Finance lacked experience with line agency responsibilities. Second. unfamiliarity with IDA procurement and disbursement procedures, led to ex-post rather than ex-ante approval of procurements and granting of "no objection" letters. This delayed implementation. Third, implementation was haphazard and ad hoc. This was because after the lifting of suspension, the project was used more or less as a general-purpose fund. Components were shuffled in and out of this project depending on the availability of funding from alternative project budgets. Also, the implementing agency did not prioritize its implementation to ensure that those activities implemented had the greatest possibility of achieving the objectives of the project. For example, ensuring that short-term training programs selected had the greatest potentials for capacity building and practical applications on the job. 5. Fourth, barely nine months after effectiveness of this credit, disbursements to Zambia were suspended for failure to service her debt to the Bank. This disrupted implementation and created a discontinuity in implementation and its momentum. The result was that the project that was implemented was different from the one that was originally designed, but without the benefit of a thorough revision. Fifth, the Implementation Monitoring Committee was not resuscitated after the suspension to provide direction and long-range planning in terms of consultants, training, and equipment procurement, as originally envisaged. This greatly affected the quality of implementation. Sixth, on-the-job training was inoperative in most cases. This was because of the lack of interest on the part of Zambians to receive training from expatriates due to their reticence, and the reluctance on the part of some experts to train Zambians because of preoccupation with getting the job at hand done with the minimum of distraction. This reduced the potential for capacity building. Seventh. there was lack of transparency in choice of consultants and trainees. This resulted in delays and protracted correspondence between the implementing agency and the Bank on the one hand. and undermined the confidence of the other beneficiary agencies, on the other. And finally, frequent changes in task managers at the Bank and in project managers at the implementing agency were disruptive and created a "memory" problem in terms of implementation. 6. In spite of these problems, the project supported: several useful studies which served as inputs in the design of other loans to Zambia; twelve consultants; fifteen long-  iii term trainees and some sixty-two short-term trainees. and procured over 12 vehicles and more than eighty computers and an even greater number of peripherals (prilters, uninterruptable power supply units, scanners, and network servers) as wvell as software. 7. Two components received about 60 percent of the total disbursements under this credit. First, about 41 percent (US$3.4m) of the total disbursemenits augmenited consultancy for the Nitrogen Chemicals of Zambia (NCZ) Operations Management Services component of Cr. 1662-ZA - Fertilizer Industry Restructuring Project. The Project Completion Report (PCR) on Cr. 1662-ZA dated April 1. 1992 concluded that the project failed to meet its overall objective of improving the domestically produced supply of fertilizers for development of Zambia's agriculture at mininmutmi foreign exchanlge outflow and comparable prices. In addition, the plant is still not operating properly and its extensive need of cash to complete and maintain its rehabilitation projects is a drain on the energy and finances of the country. Second, another 17 percent (LUS$ 1 .4m) went to the Outplacement and Business Development component, with a job search and entrepreneurial development sub-components. The job search sub-component was disappointing. But by contrast, the Business Development or entreprenieurslhip training sub-component has generated significant interest nation-wide to warrant expandinlg it to cover non-retirees and non-civil servants, both within and outside Lusaka. This has helped to overcome implementation problems caused by the slow pace of the Public Sector Reform Program on which the success of the outplacement componient depended. 8. The results of the project are mixed but unsustainable, and for that reason. the outcome is rated unsatisfactory. This is in line with World Bank Operational Manual (OP 13.55, BP 13.55 and GP 13.55) of April. 1994, particularly section G, paragraplh 33 (c and d) of GP 13.55. Key Lessons Learned 9. First. in the event of a hiatus in project implemenitationi, the project should be completely reformulated or canceled at the end of the hiatus. Second, to ensure proper implementation, someone should be deployed full-time to manage the project. Third, project salaries of locally recruited consultants (previously with the civil service) should be such as not to demoralize non-project staff and one that the country can comfortably support even without donor funding, by maintaining a unified, but rewardinig pay structure. Fourth, a monitoring unit working with measurable indicators is essential to guide implementation and ensure success of the project. Fifth, effective project supervision from the Bank (supported by the Resident Mission) is indispensable to project success, by clearly identifying and addressing problems. Finally. capacity building should be an integral part of all projects in Africa.   PART 1. PROJECT REVIEW FROM THE BANK'S PERSPECTIVE. Project Identity Name: Technical Assistance Project II Credit Number: 1679-ZA Project ID: 000003193 RVP Unit Africa Region Country Zambia Sector: Public Sector - Economic Management A. Background I This project was identified in the early 1980s when Zambia was undergoing a period of acute economic and financial crisis precipitated by the secular decline in copper prices that started in 1975. Copper mining provided about 90 percent of foreign exchange eamings and 15 percent of gross value added in the early 1980s. In the wake of the crisis, production in all sectors declined, in large part due to cutbacks in import volumes. Large arrears on debt service accumulated and disbursement of external loans fell sharply. Government had begun preparation for an economic recovery program in 1983, but a foreign exchange constraint threatened to counteract the positive impact of the adjustment program. On top of this, there were severe and intermittent droughts over a number of years that induced higher than usual levels of food imports. These economic difficulties were exacerbated by shortcomings in government policy and economic management. 2. The implementation of Bank-assisted projects in Zambia also deteriorated considerably, resulting in serious implementation delays in most of them. These delays were due to lack of budgetary resources to finance or pre-finance local counterpart expenditures and ineffective and inadequate project management and coordination. This led to a considerable slow-down in the rate of disbursement on Bank Group loans and credits. 3. The Bank recognized that a key element for further reforms would be the government's capacity to sustain the macroeconomic policy environment initiated in the adjustment process. This in turn rested on the ability and effectiveness of the key economic ministries to guide and monitor the process. The adjustment program adopted in the early 1980s put severe strain on the capabilities of the key institutions. The Ministry of Finance (MOF) and the National Commission for Development Planning (NCDP), which were responsible for overall economic management and development planning, lacked the analytical capabilities or administrative machinery to cope with the  2 demands of the economic recovery program. They were poorly staffed and in need of skills upgrading and institutional strengthening to meet the clhallenges of initiating, executing, and monitoring the financial and economic recovery program and to respond quickly in terms of timeliness of available data and analysis. It was against this background that TA II was conceived. B. Statement of Objectives 4. This was the second of the self-standing technical assistance projects to Zambia financed by the Bank. It was approved on April 1 1986 and closed on December 31, 1994. The first was Cr. 873-ZA, '*Zambia Technical Assistance Project" (TA I), which was approved in 1978 and closed in July, 1987. It was designed to help the government improve its planning and project preparation capacity. The development objectives of the second TA project were to improve the capacity of the government to carry out macroeconomic analysis; improve the planning and budgeting systems to make resource allocation more responsive to government policies and objectives, and improve management and accounting skills and the availability, speed and accuracy of essential management information. In June 1991, concurrently with the resumption of disbursements after a four-year suspension, the project objectives were expanded to support parastatal reform, privatization and public sector management. The attainment of these goals would contribute to macroeconomic stability, restoration of growth, and to structural changes needed for long-term sustainable development. 5. These objectives were in consonance with the spirit of self-standing Technical Assistance projects that characterized this period (early and mid-1980s) in Africa. The underlying assumption was that a dose of foreign expertise in critical areas would plug the deficiency in analytical capacity in the short run. In the long run, through on-the-job training provided by foreign experts and formal training courses, the Zambians would acquire the required analytical skills. At the same time, computerization and the provision of equipment would speed information processing. 6. These objectives were to be achieved by supporting: Macro-economic analysis * Strengthening the Investment Department of NCDP in carrying out macro- economic analysis through the provision of both short-term and long-term consultants. vehicles and equipment. Financial Management * Strengthening the Data Processing Unit of MOF and Bank of Zambia in designing and implementing a computerized financial management system through the provision of technical assistance, computer hardware and software, data entry units, terminals and microcomputers.  3 Budget and Revenue Strengthening MOF's capacity in: 1. assessing the program performance and effective budget analysis through the provision of technical assistance, vehicles and equipment; and 2. establishing a system for revenue estimation and projection of future external revenues through the provision of technical assistance, vehicles and equipment. Training I . Training of Zambians by use of seminars, workshops, coaching and provision of fellowships; 2. Training of employees of the government of the Republic of Zambia's (GRZ's) ministries in adminisirative. managerial, and supervisory practices: 3. Carrying out curriculum reform and provision of accounting training for accountants and auditors of GRZ's ministries, and the provision of textbooks, audio visual and other training equipment; 4. Provision of on-the-job and other training for Zambian lawyers in legal drafting and the provision of textbooks, office equipment and vehicles for the Ministry of Legal Affairs. Parastatal Reform. Privatization and Public Sector Management: The 1991 expanded objectives provided for assistance to: * study, rehabilitate and operate the Nitrogen Chemicals of Zambia (NCZ); * review and assist Zambia Industrial and Mining Corporation (ZIMCO) companies under the privatization program; * c.arry out a number of public sector management activities; and * study the viability of the Posts and Telecommunications Corporation (PTC). C. Achievement of Objectives 7. The Bank rates the achievement of project objectives in respect of institutional development and public sector management as partial, and in respect of private sector development (as well as privatization) as negligible (see table 1). The reasons for these ratings are tied up with project implementation experience discussed below. This contrasts with a rating of "satisfactory" in the last Bank supervision report "based on the support it provided for (i) drafting the legal framework for market-led and private sector- based economy; (ii) improving budgeting and expenditure control at the Ministry of Finance; (iii) short and long-term training locally and abroad; (iv) studies to improve Zambia's foreign exchange earnings from the export of emeralds and timber products,  4 public sector reform, prepare a background report to thie upcoming Public Expenditure Review, improve the tracking of food security in the country; and improve national accounting practices; and (v) outplacement and business development services for retrenched staff." The supervision report concluded that the project could not be rated higher than satisfactory due to questions raised regarding the sustainability of the advisory services (national or otherwise); absence of Zambian counterparts understudying foreign advisors; and the ad hoc nature of the training program due to the lack of a human resources development plan. The difference in rating between this report and the supervision report is the result of different rating categories. The supervision report rating is based on the categories: "Highly Satisfactory", "Satisfactory". "Unsatisfactory" and "Highly Unsatisfactory"; while the ICR rating is based on the four categories: "Substantial", "Partial", "Negligible" and "Not Applicable". In addition, the World Bank Operational Directives indicates that any project which is deemed "unsustainable" cannot be rated "satisfactory" or higher. Project Design and Organization 8. The project brief was distributed in March 1985 and the project was appraised in April 1985. Negotiations took place in Lusaka during the period January 28-31. 1986 and the project went to the Board on April 1. 1986. The credit became effective on August 26, 1986. The credit started disbursing soon after, but all Bank disbursement to Zambia, including TA II, was suspended from May 1987 until March 1991. After suspension was lifted, the project components and objectives were amended on June 11, 1991 and a revised budget was prepared on January 15. 1993. The project was originally scheduled to close on June 30. 1992. but due to the hiatus in Bank operations in Zambia, the closing date was extended twice to December 31, 1994. The credit account remained open until April 30, 1995 to allow disbursements against expenditure authorized and made prior to the closing date of December 31. 1 994 9. The management and administration of the credit was assigned to Loans and Investment Department of the Ministry of Finance. A condition for eflectiveness of the credit was the establishment of an Inter-Ministerial Coordinating and Monitoring Committee. The committee was supposed to set criteria for the selection of trainees and consultants, and to provide semi-annual reports on implementation progress. Project Implementation 10. The project suffered from management problems. First. the project administrators and managers (prior to the suspension) were relatively junior staff and lacked the clout to effectively manage the project against the conflicting claims and vested interests of more senior officials and line ministries. Second. the quality of the project managers deteriorated in terms of educational attainments and experience. For example. the highest  5 educational attainment of one of the managers was a high school diploma. The lack of clout referred to above on the part of the project managers was compensated for by the Inter-Ministerial Coordinating Committee that functioned from 1986 until shortly after the suspension of disbursements to Zambia The Committee, was not revived after the resumption of disbursements. 11. The project faced implementation problems. First, the MOF, the agency vested with the management of the project, did not have much experience with line agency responsibility. It was not an "implementing agency" for Bank financed projects like the sectoral ministries. For example, procurement was very new to them. This generated an endless traffic of telexes, faxes and correspondence to and from the Bank throughout the life of the project centering on how to procure, what to procure, what supporting documentation should accompany requests for "no objection" letters or withdrawals. This greatly hampered successful implementation. 12. Second, some of the withdrawal applications were sent to IDA Disbursement Department without first obtaining "no objection" letters from the Task Manager on the components to be financed. This resulted in the approval of the underlying procurements/expenditures being given ex-post rather ex-ante. In some cases the Bank was presented with afait accompli, and in the interest of flexibility, it approved the activity after protracted correspondence. 13. Third, barely nine months after effectiveness, and after a slow start of disbursement, all IDA disbursement to Zambia was suspended between May 1987 and March 1991 for nonpayment of arrears to the Bank. The special account, that had been opened as part of the effectiveness conditions. proved very useful during the hiatus as the means for honoring commitments that were made prior to suspension. One example of this, and a major disbursement item during the period of suspension, involved the purchase of six vehicles for which approval had been given prior to the hiatus.2 Positions advertised to be filled in 1986, such as those of the Macroeconomist and Legal Draftsman were held in abeyance. After the suspension, other developments (including increased assistance from other donors) made it superfluous to appoint a Macroeconomist under this project. Even after the suspension was lifted in March 1991, another suspension that lasted until end-January, 1992 came into effect for failure to continue servicing its debt to the Bank. 14. Fourth, implementation was ad hoc and haphazard for the most part. After the hiatus, a proper structure for successful implementation was not present either in terms of Zambian counterpart project management staff or effective Implementation 2 The borrower found the ICB process cumbersome in this case, and argued that the purchase (which was made from Botswana) should actually be regarded as a local purchase.  6 Steering/Monitoring Committee. The non-revival of the Committee after the resumption of disbursements greatly reduced the transparency of the training and consultant selection processes. It also robbed the Borrower of a chance to review implementation progress and take corrective action. 15. Fifth, the project design did not provide proper monitorable indicators. While difficult to devise for a project of this nature, such quantitative and qualitative indicators as the skills gap; manpower requirement to carry out certain activities; the courses to which staff will be sent abroad; the number of trainees and quality of training received; the quality, timeliness and impact of consultants; the number of on-the-job trainees; and effectiveness of policy advice given or position papers written by staff; could be used for monitoring. 16. Sixth, there was lack of interest on the part of Zambian counterparts to receive needed on-the-job training from foreign experts. either because of reticence, a feeling that there is nothing the expert can impart to them, or because of pay-differential between the consultants and the local counterpart. The reverse was also true in some cases - some of the experts were too concerned with the day-to-day business at hand and in completing the assignment to spend time imparting their skills and expertise to local counterparts. Studies: 17. Studies funded by the project are detailed in Table 6. Some of them were inputs into other projects in the Bank's Zambia portfolio. For example, the NCZ component supplemented the Fertilizers Investment Restructuring Project (Cr. 1 662-ZA). The Revaluation of fixed assets of 10 ZIMCO subsidiaries was designed to benefit the Privatization and Industrial Restructuring Credit (PIRC). The Ghost Workers Study and the Outplacement and Business Development component supported the Public Sector Reform Program (PSRP). Others, such as the Food Security Study and the Export Promotion and Diversification Studies supported aspects of the adjustment program or economic and sector work on Zambia. There is very little in the files about the quality or evaluation of these studies and whether or not they advanced the achievement of the project's objectives. Merely carrying out a study is no guarantee that the resulting report would be a useful one, or that local staff could replicate these studies or utilize them for similar ones in the future.  7 Consultants: 18. There were twelve consultants engaged for the project (see Tables 5a and 6). The process of recruiting consultants was not sutficiently transparent. IDA raised issues with the selection process for some consultancies, including the terms of payment. 19. Much of the resources disbursed as of January 30, 1995 - US$3.4 million or 41 percent - was used to augment and support the consultancy for NCZ's Operational Management component. TA II documents are very sketchy on this component. referring to it only as a "refund" to NCZ. The project managers have also not shed much light on it. However, the Project Completion Report (PCR) on Cr. 1662-ZA dated April 1 1992, while not providing a direct link to TA 11 shows that the payments went to the same consultants under both projects. The PCR concluded in paragraph 6.1 that "The project did not meet its overall objective of improving the domestically produced supply of fertilizers for development of the Zambia's agriculture at minimum foreign exchange outflow and comparable income prices (sic).. .the plant is still not operating properly and its extensive need of cash to complete and maintain its rehabilitation projects must be considered a drain on the energy and finances of the country. At present less than 20% of the country's fertilizer needs are supplied from the cost intensive operation in Kafue." The prognosis has not changed since then, and may have even worsened. 20. On the specific consultancies which formed the bulk of the Bank's support, the PCR concluded in paragraphs I 1.1 and 1 1.2 that "Neither of the consultants seems to have performed fully satisfactory... (their selection) resulted in the sending to Zambia of a team which members in some cases were less highly qualified than the Zambians they displaced... and in some cases they did not seem to possess any experience or knowledge about parts of the technology of the NCZ plants." Furthermore, it concluded that "The insufficient performance led to an extension of NCZ's need for expatriate operational support for several years." 21. Another component of this credit that absorbed substantial resources - 17 percent3 - was the Outplacement and Business Development component, with a job search and entrepreneurial development sub-components. The Bank raised issues concerning the selection process for the consultants and the change in focus and emphasis from outplacement to entrepreneurship training in the TOR for the consultants. These issues were resolved and the component went on. However, the payment plan ran into difficulties because 40 percent of the contract was to be paid on signing of the contract and close to 100 percent of the TA II share within six months of the commencement of the two-years. This created a difficulty because such front-loaded disbursement provided IThe total cost of this component was US$1.8 million, of which US$1.4 million was to be borne by TA 11, and the remaining USS0.4 million by PIRC TA.  8 no recourse to the Bank or the Borrower in case the contractor defaulted. In the end, the disbursement schedule for the project had to be altered. Part of the problem resulted from lack of proper control by the project management over implementing agencies. 22. In addition, the Outplacement and Business Development component, would have been more successful and more useful if the civil service reform and retrenchment exercise had proceeded in accordance with the Public Sector Reform Program (PSRP) of 1993. The PSRP lagged behind, and the Outplacement component lacked candidates for training until it was opened up to the general civil service and even non-civil servants. Government budget has been provided for continuation of this component in 1995. This has made the Outplacemnent and Business Development component sustainable. Training: 23. In all, fifteen individuals were provided long-term training exceeding nine months in duration. Several of these received master degrees in economic development. Sixty- two short term courses were provided to staff of beneficiary agencies. This compares favorably with the nine long-term fellowships and thirty short-term training provided for in the President's Report. While a number of the long-term trainees pursued master degrees in economics, this was not sufficient to build the critical mass of macroeconomists needed to substantially raise the level of local macroeconomic analytical ability in the agencies involved. This is because policy advice is concentrated in the hands of donor-funded foreign technical assistance groups, and the trained Zambians are in other functions. The earlier the Zambians are phased-in. by using them progressively in providing "hands-on" technical policy advice, the better their chances of putting the type of training into practice and internalizing it. The short-term training was too eclectic to raise the level of macroeconomic analytical capability. 24. Taking into consideration the reallocations in the TA budget, the training budget was not fully used. However, the amount spent for training exceeded the original allocation. One area where training was not fully utilized was the Financial Management Systems (FMS) component. This was because of the hiatus and the late start of this component. Much of the training that took place occurred towards the end of the project because of the haphazard and ad hoc implementation of the training component. Proper planning and the revival of the Implementation Monitoring Committee would have focused on the organization rather than the individual. It would have identified and justified deficiencies and training needs in advance and would have sought to identify the staff who would best benefit from this training in order for the organization to reap maximum benefit. The training program would have been presented as a bundle, not piecemeal. This would have been better than identifying individuals and trying to fit whatever training to their needs and would have ensured synchronization of the timing between the availability of consultants and on-the-job trainees.  9 25. From an operational point of view, approval of training was often done ex-post rather than ex-ante. Since the threshold for the documentation of withdrawal claims had been raised from $10,000 in 1986 to $100,000 in July 1992, trainees continued to be identified and sent abroad piecemeal, thereby avoiding the need to obtain "no objection" letters from the Bank and also avoiding the need for additional documentation and scrutiny. Apparently, managers of the project in the borrowing country felt that since the credit was going to be repaid by the country, there was no compelling need to follow the stringent requirements of IDA for disbursement and procurement. Equipment: 26. As with training, procurement of equipment was slow initially. It improved towards the end of the project as the closing date approached, out the equipment acquired was not properly maintained or used in the best way possible, or for the purposes for which it was procured. In particular, vehicles were not always used for the project for which they were meant, they were sometimes used outside office hours and some of them were involved in accidents. Of the six vehicles which were purchased earlier in the project life, one remains on the road. Most of the computers were procured late in the project life, thus delaying achievement of the purpose for which they were bought. Those that were bought earlier are being put to good use. There was difficulty in abiding with IDA procurement procedures in the acquisition of computers. Despite a procurement workshop held in Lusaka for project staff, problems with procedures persisted throughout the project implementation. 27. The FMS component was to finance (i) the design and development of a management system based in the Data Processing Unit (DPU), (ii) the purchase and development of computer hardware and software, and (iii) the training of staff in its operation. The FMS component was time-phased in the President's Report. Yet, there was a lag in putting in place a system that would be responsive to the financial information needs of the government as identified in the project document. D. Major Factors Affecting the Project 28. The first and most important factor that affected this project was the suspension of disbursement to Zambia between May 1987 and March 1991 and again from July 1991 to January 1992. This resulted in very little being done beyond what had been approved in the first nine months. The already precarious capacity to do macroeconomic analysis was further compounded by the fact that the traditional source for augmenting this capacity - foreign experts - ceased as donors cut off disbursement. Capacity was neither built nor augmented during this period. This can be seen from the unsuccessful attempt at a home- grown alternative to adjustment tried during this period.  10 29. Second, instability and frequent changes of project staff both at the Bank and in the country affected implementation. There were at least five task managers for this project at the Bank and six in the implementing agency. In the latter case. the quality of the project managers also tended to decline with the passage of time. The result was that implementation problems kept recurring because new managers had to learn. At the Bank, the frequent changes meant that commitments made by previous task managers on financing studies, were not properly conveyed to succeeding managers or even recollected by past managers. This led in some cases to rejection of the request for payment when the studies in question were completed. E. Project Sustainability 30. The project does not seem to be sustainable because of its piecemeal and ad hoc implementation. There are, at least, four factors that indicate the lack of sustainabilitv. First, not much training of Zambians by the foreign expert advisers has taken place. Consequently, Zambians are ill-prepared to take on the responsibilities required of them under the project. Second, funding for key experts under this project was requested past the closing date. Third, Zambian experts cannot be absorbed into the normal budget without a substantial cut in their project-supported salaries which is higher than the regular civil service salaries. Unless alternative sources of funding are found, most of the personnel will be gone and their slots will be empty. This applies both to foreign experts and Zambians being paid internationally competitive salaries. Finally, some equipment procured with the proceeds of this credit has also not always been put to the best use to ensure sustainability. Computers, on the other hand, are being used to enhalnce productivity and are greatly appreciated by the beneficiaries, even thouglh their arrival was delayed. Question of sustainability for the computers would depend on wlhat arrangements are made for repairs and maintenance and how SOOI1 they are overtaken by technical obsolescence and depreciation. F. IDA Performance 31. The implementation problems identified in this report are the result of failure to redesign the project after the hiatus. The hiatus provided an opportunity to look more carefully at the project and completely redesign it. This would have involved looking at the objectives, reprioritizing, and extending the closing date for the project in order to take account of the period of suspension. Unfortunately, this was not done. When the project was reinstated in 1991/92, the Bank assumed implicitly that funds would fully disburse and the project would close by the original closing date of December 3 1, 1992. This was unrealistic and may have led the borrower to feel that there would be several extensions. Failure to redesign and extend the closing date meant that towards the end of the project. exhortation to disburse as much as possible of the funds focused attention on the quantity rather than quality of implementation. in an attempt to heat the deadline.  I 32. The revision of the project in 1991/92. merely expanded it to cover areas in which the Bank's portfolio was becoming active. This robbed it of focus compared to its original objectives and made it a general purpose fund. The achievement of the objectives of such general purpose fund would be difficult to judge. Supervision should have made up for some of the design flaws, or for the failure to do a mid-term review or redesign and extend the closing date when the project was reviewed for reinstatement.. 33. The effectiveness of some of the supervision missions is questionable. First, they did not always identify implementation problems of the project. Second, even when the problems were identified, required follow-up action to resolve them were not carried out. Third, earlier supervision had glossed over some of the problems that arose, and it became difficult for subsequent managers to take definite stance on project implementation without being regarded as inflexible. Fourth, the ratings for project implementation and achievement of development objectives in the supervision reports during the suspension of disbursements, 1987-1991, were not realistic because ratings were assigned to these variables during that period when nothing vias taking place. Fifth, some of the supervision missions were undertaken incidentally as part of supervision of other projects. robbing the project of the depth of attention it needed to be successful. Sixth, there was inadequate information on implementation progress in some of the supervision reports to fully evaluate the project. Aide-Memoirs and other attachments to Form 590 were often separated and they did not contain sufficient information to allow for a proper evaluation of achievement of objectives. Seventh, the project was not clear in spelling out monitorable yardsticks. Finally, as already mentioned, frequent changes in project staff posed a big problem both for the supervision and for the implementation of the project. G. Borrower Performance 34. The implementation of the project accelerated after the lifting of suspension. Nevertheless, the pace was still too slow. There was inadequate attention to cost effectiveness in terms of use of project funds either for consultancies or for studies and personnel. This lack of attention to cost effectiveness conveyed the impression that in spite of the point made in paragraph 24 above, the project was implemented as if it was a grant rather than a credit that had to be repaid in the future. This led to the subordination of project-wide considerations to individual needs. 35. In spite of the length of the project life, the basics of IDA procurement and disbursement were not mastered. Proper coordination was also absent and progress reporting and use of institutions established for the project were lacking. Project staff were working only part-time on this project and were saddled with other responsibilities that appeared to take more of their time, so that only passing attention could be given to  12 the project. Overall the implementation experience tended to call into question the government's commitment to the objectives of the project. H. Assessment of Outcome 36. The result of this operation is mixed but unsustainable, and for that reason the outcome is rated unsatisfactory. The project resulted in upgrading the education of several beneficiaries. It provided equipment for more efficient delivery of services. It also funded consultants and studies that were important in policy preparation and advice. Its primary objective of capacity building was, at best, partially achieved. Some Zambians received higher education and have improved their capacity for policy analysis. Nonetheless, the training programs have not been based on any systematic analysis of skills needs or deficiencies. However, all who went on training are still within the government. It is not certain how many are applying the skills they acquired and how many of those training courses were actually relevant to the jobs held by the beneficiaries. 37. Although notable progress and improvements have been made in some areas of macroeconomic analysis, findings highlight continued weaknesses in: macroeconomic analysis, particularly in public investment programming and its linkage to the budget process; budgeting and revenue estimation and projections, particularly in accounting for donor funding; and financial management, mainly due to the delay in establishing the computerized Financial Management System. 38. Since improving the budgeting process was one of the objectives, the fact that these problems still persist is symptomatic of the stunted achievement of this project. Moreover, during the Government Feedback Survey meeting held in February 199:5. Zambians pointed to the continued lack of analytical capacity in the key economic ministries - an indication that TA 1I was not successful in removing this constraint to policy-making. 39. The legal component is the most successful. It has provided legal draftsmen who have drafted the legislation required for the reform program and investment laws. This has greatly advanced the adjustment program of Zambia. The legal draftsmen drafted about 43 pieces of legislation, acts and statutory instruments in 1993 and 46 in 1994. The Legal Affairs Ministry's training component. particularly the on-tle-job training. partially eased the constraint posed by shortage of legal draftsmen. At the outset of the project, there was a critical shortage of personnel in the Ministry of Legal Affairs: there were fourteen positions of which four were filled at the outset. The recruitment of two Legal Draftsmen reduced the deficit to some extent.  13 40. There have been improvements, albeit limited. in other areas as well. First. the NCDP has improved its economic policy analysis capability and the quality of its Economic Report and Public Investment Program (PIP) publications. Secondly. the Ministry of Finance is improving its accounting and financial professionals and the standard of training for accountants. Third. some of the studies and sub-projects have met with success. The export promotion study resulted in actual orders for Zambian goods from potential foreign buyers. This will improve exports of non-traditional products, mainly timber and gemstones. After a slow start. th. Business Development and Outplacement component is now enthusiastically embraced nationwide by civil servants and non-civil servants alike. The program has been extended to the regions and provinces using local trainers who will take over the scheme at the end of the consultant's contract. Notwithstanding these successes and apparent sustainability of the Business Development and Outplacement component, sustainabilitv is doubtful for the project as a whole. 41L Despite the weak performance of this TA project. and the shortcomings of self- standing TAs, there is room for further capacity building in Zambia. A well-focused and well-conceived project, under the management of a department very much concerned with macroeconomic issues, could be rewarding, provided the lessons learned from this experience are taken into account. 1. Key Lessons Learned 43. The following lessons emerge from the review of this project: (a) Where there has been a hiatus in project implementation, as was the case between May 1987 and March 1991 in Zambia, the Bank should have done a mid- term review and given careful thought at reinstatement to redesigning it. At a minimum, it was necessary to ensure that there was sufficient time to implement the project by extending the closing date to reflect the time elapsed as a result of the hiatus. (b) Measurable monitoring indicators and a monitoring unit are needed to guide implementation and ensure the success of the project in achieving its objectives. (See paragraph 15 above). (c) The Resident Mission should be intimately involved in the supervision of a project as was the case at the very beginning of this project. The need for both Headquarters staff and the Resident Mission staff to work together cannot be overemphasized. In this connection, as of late, the Resident Mission's role in vetting some of the withdrawal applications,  14 providing a resident procurement officer to act as an adviser, and being easily accessible to the borrower, have greatly improved implementation as well as relations with the Bank. (d) The remuneration of local staff should be such as not to produce a dual salary structure. This can lead to loss of morale among civil servants not benefiting from higher remuneration tied to Bank projects, and is often counter-productive when the objective is to build local capacity. (e) To ensure proper project implementation, a full time staff of the government should be in charge of project management and implementation. The incumbent should be freed from other responsibilities. (f) Systematic analysis of training needs and the formulation of a training program should be undertaken by the government to ensure orderly implementation. (g) Supervision is very important for project implementation. It is critical that supervision missions help identify and address the problems wlhich arise in the implementation of a project. Form 590 should contain sufficient information to permit properjudgment about the project experience. (h) Institution building is important and crucial to development in the countries of Africa. In future projects, whether for institution-building or not, the terms of reference of consultants should include the training of local counterparts who would provide services similar to those provided by the consultants. This should be a condition for final payment of fees. Fulfillment of this condition would be shown by presenting local staff input or allowing them to do similar analysis in areas that are important to the government. (i) Using local consultants should be encouraged. however, care should be taken to avoid demoralizing the other staff who are not being paid internationally competitive salaries. (j) Zambia may benefit from a well-planned and properly implemented Technical Assistance project if these lessons are takeni into account. But a self-standing project may not be the most appropriate vehicle for tlhis.  PART III: STATISTICAL TABLES Table 1: Summary of assessment A. Achievement of Objectives Substantial Partial Negligible Not applicable Macro policies X Sector policies x Financial policies X Institutional policies X Physical objectives X Poverty reduction X Gender issues X Other social objectives X Environmental objectives X Public sector management X Private sector development X Other (specify) B. Project sustainabilitv Likely Unlikely Uncertain x Highly C. Bank performance Satisfactoy Sifacti Deficien Identification X Preparation assistance X Appraisal X Supervision X Highly D. Borrower performance Satisfactory Satisfactory Deficicnt Preparation X Implementation X Covenant compliance X Highly Highly E. Assessment of outcome Satisfactory SatisfactorI Unsafisfactor Unatisifaco x  16 Table 2: Related Bank loans/credits Year of Loan/credit title Purpose Approval Status Comments Zambia Technical Assistanec Project preparation & planning 1978 Fully disbursed. TA 11 was to continue financing of Project (TA l; Cr. 873) Closed 7/31/87 Macroeconomist and Debt Adviser Zambian Program Loan 11 Macroeconomic adjustment 1976 Fully disbursed. (L. 1322) Closed in 1977 Economic Recovery Credit Support of macroeconomic 1986 Fully disbursed. (ERC l; Cr. 1720) stabilization and adjustment Economic Recovery Credit 11 Support of macroeconomic 1991 Fully disbursed (EIRC I: Cr. 2214) stabilization, market Closed 6/30/92 liberalization and adjustment Government Privatization/Ind Privatization and parastatal 1992 Completed Reform Credit (Cr. 2405) reform Govt. Privatization/industrial PIRC technical assistance 1992 Ongoing Continued support for some TA 11 Rcrorm (PIRC TA: Cr.2406) components Govt. Privatization/industrial Privatization and parastatal 1993 Ongoing TA 11 supported project preparation/ Reforn Credit (PIRCIl:Cr.2523) reform studies for this program Zambia Economic and Social Macroeconomic stabilization 1994 Ongoing Adjustnient Credit (ESAC; export promotion. delivery of Cr.2577) vital social services. Fertilizer Industry Restructuring Restore technical integrity/ 1986 Closed 12/31/91 TA II provided support (refund) for Project (Cr. 1662) financial viability of NCZ and the Operations Management timely and cost-effective de- Services for the rehabilitation of livery of fertilizers to farmers the NCZ fertilizer plants  17 Table 3: Project timetable Steps in project cycle Date planned Date actualAatest estimate Status INITIAL EPS Completed PREAPPRAISAL 6/12/85 6/12/85 Completed REVIEW FEPS/IM TO OC Completed DEPART. APPRAISAL 3/17/85 3/17/85 Completed YELLOW COVER 10/16/85 10/16/85 Completed DOCS TO RVP 11/13/85 11/13/85 Completed INVIT. TO NEGOTIATE Completed START NEGOTIATIONS 9/85 1/27/86 Completed BOARD APPROVAL 3/27/86 4/1/86 Completed SIGNING 5/2/86 5/2/86 Completed EFFECTIVENESS 8/26/86 8/26/86 Completed CLOSING DATE 12/31/92 12/31/94 Completed ICR (PCR) DRAFT 3/31/95 3/31/95 Completed GOVT. APPROVAL 5/31/95 3/06/95 Completed ICR (PCR) TO OED 6/30/95 Active  18 Table 4: Credit disbursements - cumulative, estimated and actual DisbL Original Cumulative Actual Cumulative Cumulative Estimate DUE Original Disb. Actual Actual/Est. FY Estimt Disb. Est. $ Disb.$ % by vear 1986 0.4 0.4 0 0 0.00% 1987 1.6 2.0 0.42 0.4 20.00% 1988 2.0 4.0 0.23 0.65 16.25% 1989 1.7 5.7 0 0.65 11.40% 1990 1.2 6.9 0 0.65 9.42% 1991 0.9 7.8 0 0.65 8.33% 1992 0.2 8.0 2.31 2.97 37.13% 1993 0 8.0 1.47 4.44 55.50% 1994 0 0 1.95 6.39 1995 0 0 2.09 8.48 Note: Column 7 is column 5/column 3.  19 Table 5: Key indicators for project implementation L. Key implementation indicators in the SAR/President's Report Estimated Actual Remarks a). Macroeconomist 48 m/m Not appointed under TA II b). Short-term consultants (Investment Plan.) 36 rn/m c). Consultant (computerization) d). Budget Adviser 36 r/mr 24 rn/m e). Revenue Adviser 24 r/rm Not appointed 0. Management training Irish parallel-financed component.- g). Accountancy training/curriculum reform h). On-the-job training of legal draftsmen in Ministry of Legal Affairs 48 n/m 38 nrm i). Economic Adviser (MoF) (extension from TA I) 24 mim Not appointed j). Financial Director (ZIMCO) (extension from TA I) 24 m/m Not appointed k). Training fellowships: 260 m/m NCDP - Economics 3 fellowships 18 n/m each; (See Table 5B below) Masters in Development Economics. - Project Preparation, Evaluation, Data 8 short-term 3 mrm each training. Investment Planning (IP) and Sector Processing, Planning Planning Budget Office - Economics 2 fellowships 18 mrm each; MA In Economics - Financial Analysis, Computing. 3 short-term 3 m/m each training Budget preparationlimplementation Financial Planning staff Loans and Investments - Economics 3 fellowships 18 n/m each; MA in Economics - Debt management, Financial Analysis, 7 short-term 3 mrm each training Debt, revenue, aid staff Computer Programming DPU - Systems Analysis I 1 MS 18 * m FMS staff - Database system; Computer 12 short-term 3 m/m each DPU staff (sotware/programming) Programming. I). Financial Management Systems: - Phase l: Streamlining data flows 9 months Suspension of disbursements to - _Phase II: Training 4 years Zambia delayed and disrupted the -Phase II: Requirements definition/ 6 months schedule. development strategy I -Phase IV: Implementation/integration 127 months - Phase V: Microcomputers in sector 15 months Ministries. I Note: * The Irish Government had an agreement with the Government of the Republic of Zambia to parallel-finance the management training component to the tune of US$1 .00 million. This parallel-financing arrangement appears in the project document, and earlier supervision reports indicate activity in the component during the hiatus. Later supervision reports, however, are silent on this and the project managers profess to be unaware of the component and its implementation.  20 Table 5A: Modified key indicators for project implementation. II. Modified indicators Estimated Actual Remarks 1 Consuttants: $3.350.000 S5,113,936 Credit amounts for consultants & studies a). Budget Advisor (Prof. Ben Mweene) 24 m/m 21 m/m b). Auditor-General (Mr. Nair) 24 m/m 24 m/m c). Financial Adviser (Mr. Dhalabhoy) 6 months d). Financial Director, UTH (Mr. Alam) 36 m/m 24 m/m e). Consultant, CSO (Mr. Kansal - see studies) 60 days f). Legal Draftsman (Mrs. Eva Jhala) 24 mrm 20 m/m g). Legal Draftsman (Mr. Graham) 24 m/mrn 20 mrm 2. Studies: a). ZIMCO study $588,000 No disbursement b). Public sector reform study(phase 1) $15,000 $9,950 c). PTC study $700,000 $334,300 Report expected d). Export promotion/development study $500,000 Also includes study tours & exp. directory - GOPA Timber study $132,750 $82,631 $82,631 of $132,750 to GOPA - Brunelli Engineering Gemstone study $219.750 $191,661 $183,161 paid by IDA a). OutplacementBusiness development $1,800,000 $1,400,000 Remaining S400k from PIRC II TA f). Public expenditure review $10,000 Su cortZambian input into PER g). Matchmaking invitabon (Korean Business- $20,000 Visit of Korean businessmen to Zambia men) _ h). TA procurement study S100,000 Held in Lusaka i). Revaluation of fixed assetsfor 10 ZIMCO $15,000 GBP 14,500; K975,600 companies j). TAIl preparation study (B-M-B) $200,000 $200,000 - k). Food security study (Oxford group) S129,000 S129,000 I). NCZ refund $2,200,000 53,496,013 Revised estimate: $4.6m. ($3.5m paid to EINICHEM AGRICULTURA) m). Audit of NCZ rehab. proj. (SASOL Ind. Ltd) $94,000 $89,628 Physical audit of NCZ rehabilitation proj. n). Census of public employment S500.000 = _ No withdrawal under this project o). Ghost workers study (IRI) $15,000 $9,950 Paid to Harry Sasson (consultants) p). National accounts study (Mr. kansal - CSO) $20400; revised: $64000 $48,523 See Mr. Kansal above. ,3.Equipmejnj S768,000 $1,530,276 Vehicles ___ At least 12 vehicles bought Computen _ _= In addibon to 80 computers and an equal Printers number of printers and peripherals for the Uninterrupted Power Supply _ _ DPU. computers also procured for other Ministries/Agencies (incl. MoF & NCDP)  21 Table 5B: Key indicators for project implementation (training, component - actual) No. |Name I Position Affiliation Counre Univesity/institution Duration 4 TRAININGI A Lona term training (gmonths and over) t Mr. L. Chiinda Economist NCDP M.Sc. (Economics) Manchester Univeristy 2 years 2F. Muwezwa Economist NCDP M.Sc. (Economics) Manchester University 2 years 3 Miss P. Nyirenda Computer Programmer NCDP Dipiploma in Computer studios Gloucester College 2 years 4 Bimbe Simbe Analyst HND Brighton University 2 yeas 5L Chibangula Programmer __HND Brighton University 2 year 8 D. Chizenda Economist Macroeconomic Adjustment Manchester Met Univ. 2 yeam 7 Mr. A. G. Goma Senior Accountant Loans & Investments (MoF) MBA Univemsty of Wales 1 year 8 W. Kasem a Economist M.Sc. (Economics) Universty of Wales 1 year 9 Mrs. G. N oma Senior Economist NCDP M.Sc. (National Dev. & Project Planning) Bradford Univeity 1 year 0 Mr. J Kapai_ Director Budget (MoF) M.Sc. (Economics) Birmingham Univerity 1 year 11 C. Chiwam Accounts Clerk Loans & Investments (MoF) ACP Di plomi in Programming West London CoieLe 1 year 12 K Mubanga Accounts Clerk Loans & Investments (MoF) Programming & computer systems West London College I year 13 Ms. F Zimba Senior Analyst Data Center (MoF) HND (Computer studies) Sheffield Hallam Univerity 1 year 14 M Munumi Economist M.Sc. (National Development University of Bradford 1 year 1 5 E. Musaba Auditor _ACCA III Emile Wolt College gmonths B. Sho t-term training (less than 9 months) _ 1 S. Ndhlovu Principal Accountant NCDP (Macroeconomics) Financial Management Crown Agents, London 5 days 2 B M. Zimba Assistant Secretary Debt Management Crown Agents, London 14 days 3 A. G. Goma Senior Accountant Loans & Investments (MoF) Debt Management Crown Agents, London 14 days 4 A. G. Goma Senior Accountant _ Loans & Investments (MoF) Accounting ADB 14 day S W. D. Musonda Director Loans & Investments (MoO Accounting ADB 14 day 6 J. Chali Accountant Loans & Investments (MoF) Accounting ADB 14 day 7 J. ChaIr Accountant Loans & Investments (MoF) Financial Management Crown Agents 12 days B 6 J. Chah Accountant Loans & Investments (MoF Loan Negotiations Internatonal Law Institute 27 doys 9 J. Chali Accountant Loans & Investments (MoF) Disbursement seminar Nairobi 5 day 10 J. Chali Accountant Loans & Investments (MoF) Financial Analysis Euromoney 8 days 11 L. G Chikopela Accounting Assistant Financial Management ESAMI 30 day 12 J. Mweetwa Economist Budgeting & Planning Harvard Institute 48 days 13 E. Musenge Economist Budgeting & Planning Harvard Insttute 48 days 14 C. Mwango Principal Accountant Computer UNCTAD 7 days 15 V. Ng 'ombe Accounts Clerk Computer UNCTAD 7 days 16 V. Ng ombe Accounts Clerk Financial management Crown Agents 14 do 17 Dr. K Mwamba Director NCDP (Macroeconomics) Financial Management Crown Agents 12 days 18 Dr K Mwemba Director NCDP (Macroeconomics) Management of Stock Exchange Johannesburg Stock Exchange 30 days 19 Dr. K Mwamba Director NCDP (Macroeconomics) Environmental Assessment Aberdeen University 51 days 20 Eddah Phini Accounting Assistant Fiancial Management ESAMI 36 days 21 M Lukwesa Accountng Assistant Debt Management Crown Agents 14 days 22 K. Nkolola Economist Proposal writing for projects Graduate School, USDA 21 days 23 Bede Mphande Principal Economist NCDP (Macroeconomics) Computer systems Faculty Unit I 30 day 24 E. C. Katai Director Investment & appraisal Harvard Insttute 50 days 25 P. Sitwala Economist Financial Planning University of Strathclyde 3 months 26 Ms. F. Sitwala Economist NCDP (Macroeconomics) Financial Planning & Management Univerity of Strathclyde 74 days 27 A. Zulu Economist Public Enterprise HIID 40 days 28 Ms. Eddah Chirwa Economist NCDP (Macroeconomics) Budgeting in the public sector HIID 40 days 29 C M Mwauluka Computer Analyt Structured aytems & analysis ESAMI 30 days 30 Bimbe N Bimbe Computer Analyt Structured systems & analysis ESAMI 30 days 31 K Mwanza Computer Analyt Structured sstems & analyis ESAMI 25 days 32 Mrs. Nvula Prncipal Accountant Donor funded projects ESAMI 30 days 33 W Kalaluka Economist Legal issues in Privatization International Law Institute 14 days 34 G. Nyirenda Clerical Officer Management applications for computers Graduate School, USDA 40 days 35 Mr E Longwe Director Macroeconomic policies Malawi 9 days 36 C Lishomwa Economist Negotiating international joint ventures International Law Insttute 14 days 37 C. Simpasa Planner Macro computers in proect planning Bradford Univesity 52 days 38 Mrs P. K Bwalya Planner NCDP (Macroeconomics) Managing sustainable projects University of Bradford 81 da 39 B Mphande Economist Advanced computer sstems Persona Faculty 29 days 40 Mrs Mwanakaoma Legal Counsellor Negotiating & drafting of agreements International Law Institute 14 day 41 B I Mulens aPrincipal Accountant Ne otiating & drafting of agreements International Law Institute 14 days 42 B I Mulenga Principal Accountant Disbursement seminar Nairobi 5 days 43 F. K Yamba Economist Investment appraisal Harvard University 0 days 44 L M Mwale Economist Analysis & negotation Financ:al Eng 14 days 45 A Musenge Senior Economist NCDP (Macroeconomics) Macroeconomic adjustment Harvard Institute 4E je 48 Mr E Kapwepwe Senior Economist NCDP (Macroeconomics) Environmental economics Harard Insttute 30 days 47 M Lukwesa Assistant Accountant Financial management USDA Graduate School 30 days 48 J K Mwenda Accountant Financial Analyis Euromoney 7 day 49 F. X Ndakola Assistant Secretary nformaton systems USDA lntemational Institute 33 days 50 G R Moono Economist Management applications for computers Intemational Insitute for Development 52 days 51 A Musunga Economist Financial management Crown Agents 16 days 52 M. Ngomalala Economist MA (Economics) Jnivert of Manchester 3 months 53 L Chikopela Assistant Accountant Financial Management _ ESAMI 30 days 54 E Tembo Accounting Assistant Financial Management _ ESAMI 30 days 55 S Chibanda Deputy Director Financial Analysis _Euromoney 8day 58 H Banda Accounting Assistant Financial management Crown Agents 14 days 57 A. 0 Chijungula .Assistant Auditor ACCA level Ill Accountancy Tutors 3 months 58 P Chuungu Accounting Assistant Computer applications Crown Agents 30 days 5S. Muyunda Princip l Analyst Advanced issues in micro-con er' ESAMI 25 days eoLJ M Mwansa Princip l Economist Management applications for cr- nuters International Institut or Devek>pment 52 days 81IN N. Phini Economist Project Analysis Grduate School USDA 87 day 82 F Mushibw Economist _ Economic policy management Universty of Bradford 3 week  22 Table 6: Studies included in project Purpose as defined Study at appraisal/redefinition Status Impact of study I Report of mission to prepare TA II Prepare TA il Completed, 1985 Input in design of TA II 2 Outplacement & Business Train retrenched civil servants On going. Entrepreneur- 4553 attended training. Development Component in entrepreneurial skills and ship training aspect sus- Estimated 25-28% started help with job placement tainable. Funds businesses. About 2% job allocated for 1995. placement rate. 3 Review of parastatal sector Comprehensive review of Not carried out under Input in privatization and (Phase 1) financial, technical & manage- this project public sector reform program ment restructuring of ZIMCO 4 PTC study study of post and telecom. Ongoing Report expected service to restructure or reform 5 Revaluation of fixed assets for Revalue assets of companies Completed. Revaluation of assets group of 10 ZIMCO companies 6 Privatization of ZIMCO subsidiary Privatization/restructuring of Not carried out under Input in privatization program comnpanies(INDECO, National Hotels ZIMCO this project NIEC, & ZCCM) 7 Food security study Evaluate Food security in Completed Policy options and early the face of drought warning system 8 Export promotionidiversification Study export potential, program Completed Resulted in increased orders study: for export development and for non-traditional exports a). Pre-export handling of gemstones export diversification for from Zambia and publication (Brunelli) Zambia. of comprehensive directory b). Timber grading/sustainable of Zambian exporters. exploitation of wood resources (GO PA) c). Publication of Zambia Export Dir. d). Study tours/visits; trade fairs 9 Ghost workers study Identify ghost workers completed Identified ghost workers 10 Census of Public Employment Census of public servants No disbursement under Identified ghost workers. Input this project in PSRP I NCZ (Nitrogen. chemical of Zambia) Management services to Completed. Designed to provide manage- restructure and improve (Supplemented main ment services for NCZ. management, efficiency, and project that financed the Accomplished with some profitability of NCZ. INCZ effort). delay. Not very successful.  23 |Table 7A: Project Costs I I I _ I I ApDraisal Estimate (U $M) Actual/latest estimate (US$M) Item Local costs Foreign costs Total Local costs Foreign costs Total Consultants: 0.41 2.94 3.35 5.114 NCDP - Macroecon Anal. 0.84 0.84 FMS 0.41 1.5 1.91 Budget & Revenue (MoF) 0.6 0.6 Training: 0.29 2.28 2.57 1.719 Management Training 0.16 0.75 0.91 Accountancy 0.09 0.63 0.72 Legal Training 0.04 0.4 0.44 Fellowships & study tours 0.5 0.5 TA I followup 0.44 0.44 Equipment (incl maint.) 0.16 0.6 0.76 1.53 Contingencies/unallocated 0.74 1.54 2.24 0.12 Total 1.6 7.85 9.45 8.483 (b) Undisbursed (as at 4/30/95) 1.914 (b) Table 7B: Project Financing I _ _ _ _ I _ _ I _ I _ _ =__ _ _ Appraisal Estimate (US$M) Actual/latest estimate (U $M) Source Local costs Foreign costs Total Local costs Foreign costs Total IBRD/IDA 1.1 6.9 8 8.483 8.483 (b) Cofinancing institutions Other external sources (a) 0.1 0.9 1 Domestic contribution 0.4 0.4 Total 1.6 7.8 9.4 8.483 8.483 (b) Undisbursed (as at 4/30/95) 1.914 (b) Notes: (a). The project document indicates that the Irish Government agreed to parallel-finance the management training component (US$1.00 million). Earlier supervision reports confirm activity in the component during the hiatus. But later supervision reports and project managers were silent on this component. (See footnote on Table 5 above) (b) Because of exchange rate fluctuations and since the original credit was in SDR, the total estimated amount of the loan as of April 30, 1995 was $10.4 million {excluding the $1.00 million mentioned in note (a) above} of which about $8.5 million was disbursed leaving a balance of $1.9 million which was undisbursed and hence canceled.  24 Table 8: Status of Legal Covenants Agemetnt Section Covenant type Present Original Revised Description Comments Status fulfniment flfilment of Covenant Credit allocation 2.02a Disbursement C Life of Life of Credit disbursementfsector Reallocations were made as project project allocation, project proceeded. Special account 2.02b Disbursement C Aug-86 Aug-86 Special account operation Closing date 203 Project closing date CD 12131l92 1213194 project closing date extended twice to 12/31194 Cornmiftni t to objecbives 3.01 General CP Life of Life of carry out project with due Lack of commitment project project diligence and efficiency with appropriate mgmt. and financial practices Prcject execution 3.02 Procurement CP Procurement pnnciples Did not follow IDA procurement principles Project execution 3.03 Employment of consultants CP Qualified consultants according No transparent method of to principles & procedures engaging consultants satisfactory to IDA Qualified countrpart 3.04 mplEmentation arrangement NC Assigning qualified No qualified counterparts staff assgnment prior to | counterparts to consultants assigned in every case to appointment of oonsultant A ensure capacity building /expert Where assigned, interest in =__________ ___________ __________ _______________________________ receiving training often lacking Fellowships/Training 3.05 Sectoral policy CP _ Institutional/sectoral allocation Original allocation not closely of fellowships by number, type, followed. No prior planning of field, duration, purpose fellowships. Appointment of Natonal 3.06 Implementation arrangement CP Aug-86 Aug-86 Nabonal pro. administrator as Effectiveness condition. Did Administrator Effectiveness condition co-ordinator of project not always prepare progress reports Appointennt of Monitonng 3.07a Monitoring/Review CP Aug-86 Aug46 Appointment & membership Established to fulfill Committee Effecbveness condibon of monitoring committee effectiveness condition. Not _____________________________ revived at the end of _______________________ _____________________________ ~~~~~~~suspension of disbursements to Zambia in 1991. Responsibilites of 3.07b Monitoring/Review NC Life of Life of Duties of monitoring Committee Did not do i) monthly progress Monitonng Committee Effectiveness condition project project reew ii aprov training _programs: iii) approve soware/hardwarestrategyfor =project as required in project ___________________________________________ ________________docum ents. 4_01a Financial CD Life of Life of Keeping appropriate records On one occasion, auditors had project project to assemble financial state- ments themselves, then audit __________________ _______ _____________________ ~~~~~~~~~~~~~records of their own makin i Financial records 4 Olb,c Accountstaudits CD Life of Life of Auditng accounts regularly During suspension, accountsi_ project project and sending copy to IDA went unaudited. There were _ about 5 overdue audits at end ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~of hiatus. Thereafter improved =_______ considerably Legend: C =covenant complied with CD = complied with after delas CP = complied with partially NC = not complied with I I  25 Table 9: Bank Resources Staff inputs Stage of project cycle Planned Revised Actual Weeks US$ Weeks US$ Weeks US$ Through appraisal 34.55 34.55 39.2 T Appraisal - Board 5 5 3.4 ____4_T_ Board - Effectiveness 15.825 15.83 1.3 Supervision 97.775 97.77 95 Completion 8 8 8 Total 161.15 161.15 146.9  26 Table 10: Bank Resources: Missions ________ ______ Perfomance Rating Number of ys Specialized Staff Implementation Development Types of Stage of project cycle Monthtyear persons field skills represented Status Objedives Problems Through appraisal hMar-8 PSM,TA LO Appraisal through Board approval Apr-861 Board approval through effectiveness Aug-8 _6___ Supervision: #1 7/1/86 1 na PSM 2 1 - Lmited legal powers of planning agency to request info from line ministries #2 Mar-87 1 PSM 2 2 nmgmt. performance of NCDP and need to transfer project management to MoF #3 12/1/87 1 5 PSM 2 2 - Suspension of IDA acivities In Zambia #4 Mar-48 I PSM 2 2 15 Jun-89 1 PSM 2 4 #6 Aug-90 1 PSM 2 4 #7 Aug-91 1 Economist 2 2 #8 Mar-92 1 Economist 2 2 #9 Sep-92 1 2 2 #10 Jun-93 2 Country officer, Econ 2 2 Non-compliance with procurement procedures & de"ys in training requests #11 Jun-94 1 Economist S S Completion: Notes:__ _ _ _ _ _ _ _ _ _ _ _ _ PSM Public Sector Management Specialis TA= Technical Assistance Expert LO= Loan Officer I I   A -)I : 9~ 181LI - L IDVN : T ; 1 I E-- c t I I -1 v I - , - il I OF - 'I