Guinea - Socio-economic Development Support Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 15694 IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SOCIO-ECONOMIC DEVELOPMENT SUPPORT PROJECT (CREDIT 1995-GUI) June 6, 1996 Western Africa Department Population and Human Resources Division Africa Region 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.  INIPLENIENTATION CONIPLETION REPORT REPUBLIC OF GUINEA SOCIO-ECONONIIC DEVELOPMENT SUPPORT PROJECT (CREDIT 1995-GUI) CURRENCY EQUIVALENTS Currency uiit: Guinean Franc (GF) Pcriod average. US S I equivalelt) 1988 = GF 474 1989= GF 592 19(0= CGF 660 1991 = GF 754 1994= G CF 902 1993= CF956 1994 = GF 977 I QQ5= GF 991 WEIGHTS AND MlEASURES Metric sstcin FISCAL YrEAR Januar' I - December 31 ABBREVIATIONS AND ACRONYMIS ACDI A*gence CW1no,diom, le D171/eponit IniWrn11tio,1o AtDF!TAF African Development Fund;Technical Assistance Fund BAD Bunqtiue .4fricine cie Developcetnent CIDA Caniadiani Iiternational Development Agency CNPS Commission N\tion/tile dIC Polifiql eSoc ioloe DCA Development Credit Agreemenlt DEIP Diwision des Enqu.;tes ei Indic.s de Prix DNIP Direction NVionMile des Investiysestcnts Plublics DNPE Direotton N.iioommle oct Pl/n et de l Ecomnmie DNSI Diroeciion 2Vniicm:le zle d .Siuisnque ei do leIn/ormatique DRHPS Divion /e.s Ro soturces funtine.s emie la Politique Sociale FIBC Euet lOe Imtliriet/voc volt "Budget ei Consownmtion" FPNI Entlitt3io Portn,inonie uupr/s dos Nitnuges ESIP Enq c/to sur le.s nfinolutitions Prioriocires cle L/iustenment Sructirel FY Fiscal Year IDA International Development Association LPDH Letire de Po/ii/icie dco De//elopoement Hutn,ain NI PC .111iiiisi/-e dill P'/ci7 et di, /i iloopcruiion NN Gt) Noni-GovermnieitLal Organi zatLjot NPl-I Naztioiial Poverty Task Force ON C Organi.satiot :Vont GCocvernnementtule PADSE Pro/et d 4ppui iiu Developpenicnt Socio-Economtique P\ I R Pr ctmmo Ncino/ .ifrcist,uoitires Ruro/es PPF Project Preparation Facility PPM U Pilot Program Management Un it SAR Staff Appraisal Report SDA Social dimensionis of Adjustnseit SDR Special Dravving Rights SEDSP Socio-Economic Development Support Projeet TA Technical Assistance UCPP fita* de Gest on dii Proczrctnmoe Piloie UNDP IJUnited Nations Development Program UNICEF United Nations Children's Emergency Fund  FOR OFFICIAL USE ONLY IMPLEMENTATION COMPLETION REPORT (ICR) REPUBLIC OF GUINEA SOCIO-ECONOMIC DEVELOPMENT SUPPORT PROJECT (CREDIT 1995-GUI) CONTENTS Preface Evaluation Summary..................................... 1. PROJECT IMPLEMENTATION ASSESSMENT ................................................... 1 PROJECT OBJECTIVES ................................................................1I ACHIEVEMENT OF PROJECT OBJECTIVES .................................................................3 IMPLEMENTATION RECORD AND MAJOR FACTORS AFFECTING THE PROJECT ....................................4 PROJECT SUSTAINABILITY .................................................................6 IDA PERFORMANCE .................................................................6 BORROWER PERFORMANCE .................................................................8 ASSESSMENT OF OUTCOME .................................................................8 FUTURE OPERATION .................................................................9 KEY LESSONS LEARNED ................................................................ 10 2. STATISTICAL TABLES ................................................... 12 TABLE 2.1: SUMMARY OF ASSESSMENTS .12 TABLE 2.2: RELATED IDA CREDITS .13 TABLE 2.3: PROJECT TIMETABLE .13 TABLE 2.4: CREDIT DISBURSEMENTS: CUMULATIVE ESTiMATED AND ACTUAL .14 TABLE 2.5: KEY INDICATORS FOR PROJECT IMPLEMENTATION .14 TABLE 2.6: KEY INDICATORS FOR PROJECT OPERATION .14 TABLE 2.7: STUDIES INCLUDED IN PROJECT .14 TABLE 2.8A: PROJECT COSTS ..................................................... 15 TABLE 2.8B: PROJECT FINANCING ..................................................... 15 TABLE 2.9: ECONOMIC COSTS AND BENEFITS ..................................................... 16 TABLE 2.10: STATUS OF LEGAL COVENANTS IN CREDIT AGREEMENT ........................................... 17 TABLE 2.11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS ......................................... 20 TABLE 2.12: BANK RESOURCES: STAFF INPUTS ..................................................... 20 TABLE 2.13: BANK RESOURCES: MISSIONS ................ v ... . 21 APPENDICES ................................................ 22 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.   IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SOCIO-ECONOMIC DEVELOPMENT SUPPORT PROJECT (CREDIT 1995-GUI) PREFACE This is the Implementation Completion Report (ICR) for the Socio-Economic Development Support Project in Guinea, for which Credit 1995-GUI in the amount of SDR 6.9 million was approved on March 28, 1989 and made effective on November 20, 1989. The Credit was closed on December 31, 1995, one year later than the original closing date. Final disbursement took place on May 6, 1996, when the remaining balance of SDR 0.44 million was canceled. Because of the increase in the dollar value of the SDR, disbursements in US dollars totaled 9.43 million compared to the appraisal estimate of 9.0 million. Apart from the government's counterpart contribution of US$0.9 million equivalent (compared with the appraisal estimate of US$0.6 million), cofinancing for the project was provided by the African Development Fund (AfDF) for US$1.3 million equivalent (compared with the appraisal estimate of US$1.9 million), the Canadian International Development Agency (CIDA) for US$1.1 million equivalent (compared with the appraisal estimate of US$0.8 million) and NGOs for US$1.0 million equivalent (compared with the appraisal estimate of US$1.2 million). The ICR was prepared by Mr. Mark Woodward of the Population and Human Resources Division, Western Africa Department of the Africa Region. It was reviewed by Mr. Ok Pannenborg, Chief of the Population and Human Resources Division, and Mr. Emmerich M. Schebeck, Operations Adviser of the Western Africa Department. Preparation of this ICR began with the supervision mission of December 1994. It was completed following a completion mission in May 1996. It is based on material in the project file. The Borrower contributed to the preparation of the ICR by providing views reflected in the mission's aide-memoire (Appendix A), preparing its own evaluation of the project's execution (Appendix B), and commenting on the draft ICR.   IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SOCIO-ECONOMIC DEVELOPMENT SUPPORT PROJECT CREDIT 1995-GUI EVALUATION SUMMARY Introduction. 1. Guinea launched a far-reaching stabilization and adjustment program in late 1985. The first phase of the adjustment program (1985-88) was supported by an IDA credit and extensive financial assistance from other donors, as well as by an IDA-financed Technical Assistance Project for Economic Management. A second phase of the adjustment program was begun in 1988 supported by a second IDA Structural Adjustment Credit and additional financing from other donors. It was also supported by a Second Economic Management Support Credit with cofinancing from several donors. Recognizing that growth of per capita income was a necessary, but not a sufficient, condition to alleviate poverty, Government decided to implement, within the framework of its structural adjustment policy, a comprehensive social policy reform, aimed at fostering the participation of the poor in the benefits of economic growth and at mitigating the transitional impact of adjustment on vulnerable groups (paragraphs 1.2 and 1.4). Project Objectives 2. The objectives of the project were to (i) strengthen the capacity of the Govemment in the areas of social policy design, coordination and implementation; (ii) strengthen the capacity of the Government to identify target poverty groups and to monitor the evolution of living conditions of households throughout the adjustment process and afterwards; and (iii) implement a priority social action program, based on specific sub-projects aimed at upgrading the living conditions of the poor and disadvantaged groups. The objectives were to be achieved through the implementation of three components: (i) a social policy planning component including a program of studies to be conducted within the Ministere du Plan et de la Cooperation (MPC) to strengthen the Government's capacity to design, coordinate and implement a comprehensive social policy consistent with the Structural Adjustment Program; (ii) a living standards monitoring component (including a permanent household survey) to identify target groups and to monitor changes in the living conditions of the population; and (iii) a pilot program-component which would finance, essentially through NGOs and other implementing agencies, priority socio-economic development sub-projects directed at the most vulnerable groups in order to mitigate the social costs of adjustment while growth gradually resumes (paragraph 1. 1). 3. The Development Credit Agreement (DCA) included special covenants to promote the achievement of project objectives. These related to: the establishment of a Pilot Program Management Unit (PPMU) and Screening Committee as well as the  operations of that Pilot Program; the carrying out of the permanent household survey and studies and the use of their results in the formulation of social policies and socio- economic development programs; the establishment and maintenance of a National Commission on Social Policy for coordinating the development and implementation of social policies; the establishment and maintenance of a Technical Committee of Users of the Permanent Household Survey to ensure their active participation in the execution of the survey and the dissemination and use of its results; and the employment of a Socio- Economic Adviser reporting directly to the Minister in charge of Planning to be the Project Coordinator and the Secretary of the National Commission on Social Policy, and to chair the Pilot Program Screening Committee (Table 2. 10). 4. The project was not designed on the basis of a participatory approach to identify problems and define clearly the project objectives and the means of achieving those objectives. Also, the design of the project did not include any performance indicators to monitor the achievement of objectives. Nevertheless, the objectives of the project were clear to the extent that the project was about building government's capacity to make better social policy and to put in place mechanisms to help the poor help themselves. Regarding the Social Policy Planning and the Living Standards Monitoring components, the aim was definitely a better poverty-reducing policy through data collection, analysis and mechanisms for letting that analysis have an impact on public policy. However, it was unrealistic to expect that such analysis would necessarily be used in the formulation of social policies. On the other hand, the objectives of the Pilot Program component were realistic. The objectives were fully consistent with the government's social policy and were important for Guinea. They were also important for IDA's country assistance strategy which was to support the Government's adjustment program (paragraph 1.2). Implementation Experience and Results 5. For the project as a whole, the achievements of objectives were generally "partial". The success of the project can be assessed as satisfactory for the Living Standards Monitoring and the Pilot Program components, much less so for the Social Policy Planning component (paragraphs 1.5 to 1.9, and Table 2.1). The project is not sustainable in the foreseeable future without additional donor support. Generally, the Government remains committed to strengthening its capacity to monitor poverty, developing poverty strategies, and helping the poor help themselves. The proposed Poverty Alleviation and Monitoring Project would continue and expand activities included in the present project. Unfortunately, the Government did not follow the action plan agreed upon with IDA in late 1994, and the approval and the timing of a new IDA credit for that proposed project are uncertain. Therefore, the sustainability of the Socio- Economic Development Support Project can only be rated as "uncertain" (paragraph 1.16). 6. The implementation record is satisfactory (paragraphs 1.10 to 1. 12). The actual project cost was US$13.7 million, about the same as the appraisal estimate. The IDA credit was almost fully disbursed, the contributions of the Government of Guinea and  iii CIDA were slightly higher than the appraisal estimates, and those of AfDF and NGOs slightly lower (Tables 2.8 A and 2.8 B). 7. A number of factors affected the achievement of project objectives. Among those factors not generally subject to government control, the performance of IDA and cofinanciers partially affected the achievement of project objectives. On the positive side, IDA developed a very good relationship with MPC and was very responsive to their needs. On the negative side, IDA was not able to maintain the level of field supervision that was planned and that was actually needed. The fact that the project was cofinanced by AfDB and CIDA did not facilitate the task of the Borrower. Among the factors generally subject to government control, the delays in the availability of counterpart funds and staffing problems (for example, the project suffered from the absence of a full time manager of the Pilot Program Management Unit) were significant. A number of factors generally subject to implementing agency (MPC) control affected the achievement of the project objectives. On the positive side, the project benefited from staff continuity across the board, and from its reliance on technical assistance, which was partially successful. Negative factors that affected the project included a minimal beneficiary participation in program design, the uneven quality of staff, and management problems (paragraphs 1.13 to 1.15). 8. IDA performance on this project was highly satisfactory at the identification stage, deficient in preparation assistance and appraisal, and satisfactory in supervision (paragraphs 1.17 to 1.20). The Borrower's performance can be rated as deficient for preparation, satisfactory for implementation, and deficient for covenant compliance. With regard to operation, the borrower performance cannot be rated, because the concept of operation does not apply to a project of this type (paragraphs 1.21 to 1.24). 9. The project has been successful in putting into place essential tools, such as databases, surveys and studies, which have been made readily available to policy makers. There has been considerable transfer of skills for the household surveys, but unfortunately not for the studies. Despite the wide dissemination of all those data and results of surveys and studies, their policy impact has, so far, been relatively limited, as has capacity building outside MPC. Funding provided to communities through the Pilot program has helped to finance a number of sustainable community-based initiatives, build local capacity to better prepare and implement community-level development activities, as well as greatly improve collaboration between Government, NGOs, and local communities. The Pilot Program Management Unit (PPMU) financed about 150 sub-projects for a total of about GF 6.2 billion, providing funding for much needed services to underserved areas. About 85% of those sub-projects were for infrastructure (essentially primary schools, health centers and health posts, and rural roads and bridges), about 10% for training and about 5% for income generating activities. The sub-projects directly benefited about 200,000 people, and provided employment and revenues of about GF 550 million to about 2,500 skilled workers. In the areas where those sub-projects were implemented, the living conditions of the population were improved through better  iv education, better health, better access to markets and some opportunities for additional income. The project's outcome deserves a rating of "satisfactory" (paragraphs 1.1 1 and 1.25). Summary of Findings, Future Operations, and Key Lessons Learned 10. The project was implemented satisfactorily and has been generally successful. In late 1994, IDA and the Government agreed that a follow-up operation would be appropriate and should strengthen the mechanisms for data analysis and policy impact as well as better focus and target micro-project funding to enhance communities' capacity to prepare and implement sub-projects. The design of any new operation would incorporate all the lessons learned from the experience of this Socio-Economic Development Support Project; in particular, more emphasis would be placed on the policy impact aspect of the proposed operation's activities. Unfortunately, the Government has not been very diligent in carrying out project preparation, so that the timing of the new operation is very uncertain (paragraphs 1.26 and 1.27). 11. The following lessons, which are relevant for future projects both in the social sectors and in Guinea, can be learned from the Socio-Economic Development Support Project (paragraph 1.28): 3 While collecting, analyzing, and disseminating data is relatively easy, making an impact on policy is far more difficult. The idea of using an interministerial committee and commission to ensure ownership and commitment as well as operational follow-up does not always work. There is a need, both at the preparation stage and during project implementation, for a more integrated, participatory approach involving consultation and dialogue between various government departments as well as with NGOs and other members of civil society. Adequate linkages, exchanges and contacts are very important to ensure that studies and surveys lead to policy formulation. * Simply subcontracting studies to foreign consultants does not build any capacity in government departments. Although the work might take longer, an alternative approach more conducive to capacity building would be to have studies undertaken by working groups composed of a mixture of civil servants, local contractual staff and consultants, backed up as necessary by foreign consultants. * Social funds are more likely to achieve their objectives the greater their independence from Government. Social funds cannot be successfully run by civil servants with a civil servant mentality, but should be operated like a private sector organization by managers with business experience. Social funds should not attempt to do everything by themselves, but should sub-contract many activities.  v * Community involvement and support in the design, implementation and management of sub-projects to be financed by social funds are very important to ensure the success of social funds. * In order for a social fund to start operations and finance sub-projects quickly, a number of conditions must be met: (i) the various instruments needed for operations, such as models of feasibility studies/evaluation reports, standard agreements with NGOs and other implementing agencies, standard loan agreements with promoters/beneficiaries, etc., must be available; (ii) adequate attention must be given to communication in order to ensure that potential promoters/beneficiaries are aware of the availability of funds and of the criteria and procedures to have access to those funds; and (iii) mechanisms must be in place to ensure that sub-projects submitted to the social fund for financing are properly prepared. * Mixing credits and grants makes the management and operations of social funds particularly difficult and risky. Credits for income generating activities require knowledge and expertise very different from that required for grants for social projects. Social funds may play an important role in helping promoters/ beneficiaries of income generating activities have access to existing sources of credit.   IMPLEMENTATION COMPLETION REPORT REPUBLIC OF GUINEA SOCIO-ECONOMIC DEVELOPMENT SUPPORT PROJECT CREDIT 1995-GUI 1. PROJECT IMPLEMENTATION ASSESSMENT STATEMENT AND EVALUATION OF PROJECT OBJECTIVES 1.1 There are differences in the presentation of the project objectives between the Staff Appraisal Report (SAR), the Memorandum and Recommendations of the President and the Development Credit Agreement. The presentation in the Staff Appraisal Report (SAR), which mixes together project objectives, approach and description, is unclear; fortunately this is much less so for the 'other two documents which are more consistent and include a definition closer to the summary of project development objectives listed in the supervision form 590. According to the Memorandum and Recommendations of the President, the objectives of the project were to (i) strengthen the capacity of the Government in the areas of social policy design, coordination and implementation; (ii) strengthen the capacity of the Government to identify target poverty groups and to monitor the evolution of living conditions of households throughout the adjustment process and afterwards; and (iii) implement a priority social action program, based on specific sub-projects aimed at upgrading the living conditions of the poor and disadvantaged groups. The objectives were to be achieved through the implementation of three components: (i) a social policy planning component including a program of studies to be conducted within the Ministere du Plan et de la Cooperation (MPC) to strengthen the Government's capacity to design, coordinate and implement a comprehensive social policy consistent with the Structural Adjustment Program; (ii) a living standards monitoring component (including a permanent household survey) to identify target groups and to monitor changes in the living conditions of the population; and (iii) a pilot program component which would finance, essentially through NGOs and other implementing agencies, priority socio-economic development sub-projects directed at the most vulnerable groups in order to mitigate the social costs of adjustment while growth gradually resumes. The objectives were not changed during project implementation. 1.2 The project was not designed on the basis of a participatory approach to identify problems and define clearly the project objectives and the means of achieving those objectives. Also, the design of the project did not include any performance indicators to monitor the achievement of objectives. Nevertheless, the objectives of the project were clear to the extent that the project was about building government's capacity to make better social policy and to put in place mechanisms to help the poor help themselves. The aim was definitely a better poverty-reducing policy through data collection, analysis and mechanisms for letting that analysis have an impact on public policy. The project did a  2 good job of putting together tools, but not in ensuring that those tools would lead to government policy; in that sense, the objectives of the social policy planning and the living standards monitoring components, although correct, were somewhat unrealistic. On the other hand, the objectives of the pilot program were realistic. The objectives were fully consistent with the government's social policy as expressed in the portion of its 1988 Declaration of Development Policy dealing with the social dimensions of adjustment. According to the SAR, the Government was fully committed to growth and poverty alleviation and was aware that the simultaneous pursuit of these two objectives implied (i) the introduction of transitory measures to protect vulnerable groups while growth gradually resumes, and (ii) the development of a comprehensive social policy reform concerned with increasing the participation of the poor in the growth process. The objectives were therefore very important for Guinea. They were also important for IDA's country assistance strategy which aimed to support the Government's adjustment program, particularly the second phase that started in 1988. IDA's important role in the recovery program put it in a leading position vis-a-vis the donor community in supporting the Government's action to alleviate poverty in a manner consistent with the structural adjustment policies. In addition, it was thought that IDA's involvement through this project would provide the financial and human resources necessary for an efficient coordination of governmental and non-governmental social actions which might otherwise be under-funded and fragmented. The project came at a crucial time in the adjustment process. 1.3 The project was complex, not in terms of the number of components which was limited to three, but in terms of the difficulty of implementing it, mainly because communication and coordination between the three divisions involved in the same ministry (MPC) were inadequate. All components were demanding for somewhat different reasons. Both the living standards monitoring and the pilot program components were something new for Guinea, but in addition the pilot program (which was also something new for IDA) was not adequately designed. Regarding the social policy planning component, MPC did not have the human resources to carry out the studies which had to be done by technical assistance, and did not have the capacity to translate the results of those studies into policies. The project was risky, particularly because of (a) the inexperience of Government's staff that would have to manage and implement it and (b) the implementation and coordination difficulties that could occur between the various MPC divisions involved. 1.4 In April 1988, the National Poverty Task Force had produced a report containing a poverty profile of Guinea, the tentative identification of vulnerable groups and proposals for a series of projects. As a next step, the Government intended to establish a National Commission on Social policy (Commission Nationale de Politique Sociale - CNPS) at the ministerial level to oversee social policy reform. It intended also to reinforce MPC to enable it to develop effective socio-economic policies and programs to improve the access to employment and basic services of the poor segments of the population. By supporting those actions, the project was responsive to changes in  3 Guinea's circumstances and priorities. The project was also a reflection of changes in IDA's priorities. ACHIEVEMENT OF PROJECT OBJECTIVES 1.5 The assessment of the project's success in achieving its major objectives should take into account the significant differences between the various components, in terms of both content and relative importance. One has to distinguish between review of the project as a whole (reflected in Table 2.1 of Part II), and more qualified comments that can be made on individual components. An additional difficulty in assessing the project's success is the complete lack of quantified criteria in the SAR for judging the achievement of objectives. Whereas Table 2.1 shows that, for the project as a whole, the achievements of objectives were generally "partial", the discussion below tries to present a more balanced picture of the achievements of the project's three components. 1.6 The achievement of physical objectives is difficult to assess because of lack of reliable data and performance indicators. Nevertheless, the monitoring living standards component achieved its main objective in the sense that two household surveys were carried out, and MPC staff is now capable of carrying out similar surveys. Likewise, the pilot program was implemented; eighty to eighty-five percent of the sub-projects have been successful and have good prospects for sustainability. 1.7 Regarding sector policies and institutional development, the achievement of objectives has been negligible to partial. The Borrower developed a capacity to carry out surveys and to finance micro-projects, but not to carry out social policy studies nor to design and implement social policies. The effect of the project on public sector management has been negligible. On the other hand, the pilot program made a contribution, albeit modest, to private sector development. The achievement of the poverty reduction objectives has been substantial in those communities where the pilot program intervened. Although the Program of Targeted Interventions (PTI) did not exist at the time the IDA credit was approved, the pilot program was targeted, with minimum leakage, and the proportion of the poor among the beneficiaries is greater than the proportion of the poor among the total population. 1.8 The design of the project (which was largely prepared by IDA staff) was generally appropriate for achieving the objectives of identifying target poverty groups and monitoring the evolution of living conditions of households, but much less so for the objectives of institutional strengthening/capacity building and of implementing a priority social action program. The national commission on social policy (CNPS) was not an appropriate mechanism or tool to ensure social policy reform. As to the pilot program, its design was rather naive, in part because, at the time, there was a lack of experience with social funds. Generally, the pilot program was not independent enough: it was to be run by civil servants with a civil servant mentality. Also, the various instruments needed for operations, such as models of feasibility studies/evaluation reports, standard agreements with NGOs and other implementing agencies, standard loan agreements with promoters/beneficiaries, etc. had not been prepared. Finally, more attention should have  4 been given to communication, in order to ensure that potential beneficiaries be aware of the availability of funds and of the criteria and procedures to have access to those funds. 1.9 The quantitative criteria for judging the achievement of objectives were totally inexistant in the SAR. IMPLEMENTATION RECORD AND MAJOR FACTORS AFFECTING THE PROJECT 1.10 The Borrower's report in Appendix B discusses the implementation record for the project, its achievements and the problems encountered. It also includes some suggestions for the future operation of the project, and on improvements which could be incorporated into any follow-up operation. 1.11 In summary, the implementation record is satisfactory. Under the Living Standards Monitoring component, a priority survey and an integrated survey have been completed, and their data have been widely disseminated among potential users. The results of the priority survey have been used by private sector and public sector organizations, as well as international agencies. Under the Social Policy Planning component, a series of seven thematic studies, a macro-economic study, a scheima directeur, and a poverty map have been completed. The poverty map, which delineates the pockets of poverty within the country, has been circulated among policy makers and has made a significant impact on a number of decision makers. The schema directeur is to be used to assist in the prioritizing of poverty reduction activities. The component also influenced urban sewage and drainage activities in Conakry. Unfortunately, limited use has been made of the available data and studies for social policy analysis and planning, and in this respect capacity building within MPC has been relatively weak. The Pilot Program component has been successful in its outreach efforts and has identified several internediaries which it has subcontracted to carry out and manage sub-projects. The Pilot Program Management Unit (PPMU) financed about 150 sub-projects for a total of about GF 6.2 billion, providing funding for much needed services to underserved areas. About 85% of those sub-projects were for infrastructure (essentially primary schools, health centers and health posts, and rural roads and bridges), about 10% for training and about 5% for income generating activities. The sub-projects directly benefited about 200,000 people, and provided employment and revenues of about GF 550 million to about 2,500 skilled workers. In the areas where those sub-projects were implemented, the living conditions of the population were improved through better education, better health, better access to markets and some opportunities for additional income. 1.12 The project had a slow start because it was not fully prepared. During implementation, there were no major procurement problems, but there were procurement delays and some problems with the use of the Special Account (which had a very low ceiling) and disbursements to NGOs. The project took one year longer to complete than expected at appraisal, with one postponement of the closing date of the IDA credit from December 31, 1994 to December 31, 1995. There are two main reasons for these implementation delays. First, the implementation schedule of the Living Standards Monitoring component was far too optimistic: it underestimated the technical difficulties  5 and the time required to set up the program and carry out the surveys (in the end, only two household surveys were carried out instead of the four that were planned). Second, the Pilot Program component had a very slow start, mostly because it was not properly prepared; it also suffered from a lack of capacity, both on the part of NGOs and promoters/beneficiaries to prepare sub-projects, and on the part of its management unit (PPMU) to appraise them and process requests for financing. 1.13 A number of factors affected the achievement of project objectives. Among those factors not generally subject to government control, the performance of IDA and cofinanciers partially affected the achievement of project objectives. On the positive side, IDA developed a very good relationship with MPC and project staff, and was very responsive to their needs. On the negative side, either because of budgetary constraints or because of the priority given to other tasks, IDA was not able to maintain the level of field supervision that was planned and that was actually needed (as an example, there was no supervision mission between August 1993 and December 1994). The fact that the project was cofinanced by AfDB and CIDA did not facilitate the task of the Borrower, who had to adjust to different procurement and disbursement procedures; CIDA contribution was managed by AfDB, and there seems to have been some dissatisfaction on the way funds were handled. 1.14 Among the factors generally subject to government control, the availability of funds and staffing were significant. Every year counterpart funds have been a problem; they were made available, but always with considerable delays, so that the project had to rely more on the Special Account of the IDA credit. The project also suffered from the absence of a full time manager of the Pilot Program Management Unit (PPMU). Cumbersome administrative procedures contributed to delays, and the Government commitment to the project was not obvious, outside of the MPC or those directly involved; however, those two factors were not major problems. 1.15 A number of factors generally subject to implementing agency (MPC) control affected the achievement of the project objectives. On the positive side, the project benefited from staff continuity across the board, and from its reliance on technical assistance, which in the end was successful for the Pilot Program component. The technical assistance for the studies program was also productive, but there was very little capacity building involved. Unfortunately, the technical assistance for the Living Standards Monitoring component fell short of what was planned and expected, especially in terms of intellectual leadership. Negative factors that affected the project included a minimal beneficiary participation in program design (particularly at the beginning of the project), the uneven quality of staff, and management problems. The effectiveness of project management was hampered by a lack of coordination between all three components, and at times tension between the components and the Senior Socio- Economic Adviser (Project Coordinator).  6 PROJECT SUSTAINABILITY 1.16 To the extent that the objectives of the Policy Planning component have not been completely achieved, the question of the sustainability of that particular component does not arise. With the emphasis placed on the coverage of recurrent expenditures for operation and maintenance, the sustainability of most of the micro-projects financed under the Pilot program component is likely. The Pilot Program itself, however, is not sustainable without further inflows of financial resources. Similarly, the Living Standards Monitoring component is not sustainable in the foreseeable future without additional donor support. In any event, the development and strengthening of institutional capacity to monitor poverty and design and implement appropriate poverty reduction policies is a long-term process. However, MPC staff are now capable of carrying out surveys, if they are given the resources to do them. Generally, the Government remains committed to strengthening its capacity to monitor poverty, developing poverty strategies, and helping the poor help themselves. A proposed new operation would continue and expand activities included in the present project, as discussed in the section below on "Future Operation". Unfortunately, the Government did not follow the action plan agreed upon with IDA in late 1994, and the approval and the timing of a new IDA credit for that proposed operation are uncertain. Therefore, the sustainability of the Socio-Economic Development support Project can only be rated as "uncertain". IDA PERFORMANCE 1.17 IDA performance on this project was highly satisfactory at the identification stage, deficient in preparation assistance and appraisal, and satisfactory in supervision. As mentioned earlier, the project was very important for Guinea and for IDA's country assistance strategy, and project identification was on target. The project was innovative and consistent with the Government's development strategy/priorities and with IDA's strategy for Guinea. IDA involvement encouraged also other donors to support the Government's actions to alleviate poverty in a manner consistent with the structural adjustment policies. 1.18 Project preparation was done mostly by IDA (with little participation by Government), and IDA performance can only be rated as deficient. Apart from the inadequacies of design and the overly optimistic implementation forecast mentioned earlier, the project was not fully prepared, so that many activities could not start immediately upon approval of the IDA credit or its effectiveness. For example, the first sub-project under the pilot program component was approved only in September 1990, and by the end of 1991 only ten sub-projects had been approved. It is interesting to note that at the time of appraisal the Senior Operations Adviser in the Office of the Regional Vice-President had expressed concerns about the lack of preparation of the Pilot Program component in particular, and about Government capacity to implement the project in general; those concerns seemed to have been largely ignored by IDA staff. On the other hand, adequate sector work was carried out before and during project preparation; in accordance with the normal approach at the time when poverty assessments did not exist,  7 a SDA CAP (Country Assessment Paper), which included a poverty profile, was undertaken. 1.19 To the extent that the project was essentially prepared by IDA, IDA appraised itself, and the performance of IDA in project appraisal should also be rated as deficient. It was the first operation of this type in Guinea, and it was also a new type of project for IDA, so that there was no previous experience which could be taken into account. The appraisal assessed properly the commitment of MPC, but not of the Government (which may explain the shortcomings of the Policy Planning component). The implementation capacity was overestimated, and the complexity of preparing and appraising micro- projects was underestimated. The first risk was recognized in the SAR, but not the second. Also, the implementation plan was not adequate, and there were no performance indicators. The procurement arrangements for the Pilot Program (which accounted for two-thirds of the IDA credit) were unusually lenient, with no requirement for Local Competitive Bidding (LCB). On procurement for the Pilot Program, there are discrepancies between the wording of the SAR and the stipulations of the Development Credit Agreement (DCA). 1.20 In view of the shortcomings of preparation and appraisal, special efforts had to be made during implementation to remedy those shortcomings, and IDA performance in supervising the project can be rated as satisfactory. At the beginning of the project, IDA helped MPC to complete project preparation. Sufficient attention was paid to the likely development impact, and by and large implementation problems were identified and assessed, including a search for solutions. However, the reporting of project implementation progress was not always as comprehensive as would have been desirable, particularly regarding compliance with covenants. The performance ratings given in Supervision Form 590 may have been too generous, reflecting a certain optimism on how fast improvements could be made. Through regular contacts, IDA staff provided useful advice to MPC, including commenting on drafts of standard model documents and on sub-projects under the Pilot Program component. The persistence with which IDA pointed out the need for adequate arrangements to cover the recurrent costs for operation and maintenance of sub-projects in order to ensure their sustainability is remarkable. IDA showed flexibility in suggesting or approving needed modifications, especially in waiving the requirement that NGOs or public agencies sponsoring sub-projects submit their financial stdtements for the last fiscal year (although Schedule 4 of the Development Credit Agreement was not formally amended), in suggesting that NGOs could be sub- contracted as intermediaries to implement and manage sub-projects (Conventions de Sous-Traitance), in reallocating funds after the idea of a new building for MPC was abandoned and in increasing the ceiling of the Special Account. Generally, IDA, the Government, MPC and cofinanciers worked together successfully. The continuity of IDA staff (same task manager and same statistician) for the supervision of this project must have contributed to the success of the supervision effort. Supervision missions could have been more frequent, since there was a period of eighteen months without field visits. On the other hand, IDA's field office in Conakry made an important contribution by participating in missions and following-up on outstanding issues. It was originally  8 intended that IDA's no objection to sub-projects costing GF15 million or less would be given by the resident mission, but unfortunately the resident mission initially did not agree to do so. There was no requirement for a mid-term review, and country implementation reviews were not particularly helpful. BORROWER PERFORMANCE 1.21 The Borrower's performance can be rated as deficient for preparation, satisfactory for implementation, and deficient for covenant compliance. With regard to operation, the borrower performance cannot be rated, because the concept of operation does not apply to a project of this type. 1.22 The Borrower's performance was deficient for preparation, because the Borrower was essentially not involved and apparently did not make much effort to gain "ownership" by participating at least in the overall design of the project. Government's participation might have improved the project design and helped avoid some of the institutional problems that arose during the course of project implementation. 1.23 The Borrower's performance in project implementation has been satisfactory. Despite some shortcomings, the project has been implemented and the IDA credit basically disbursed. On balance, the quality of management and staff has been acceptable, but some of the staff could not work full time on the project because of other assignments. The performance of contractors and consultants has been mixed; the adequacy and effectiveness of technical assistance has varied over time and from component to component. The level of counterpart funds has been adequate, but they have not been made available in a timely manner. There has been little government interference in operational decisions (even for the Pilot Program), but rather delays because officials did not always act expeditiously when they had to, such as for signing documents. There was no mechanism set up for project monitoring and evaluation. 1.24 A number of covenants of the Development Credit Agreement (DCA) were only partially complied with (a commission or committee was "established", but not really "maintained" thereafter) or complied with after delays (as for the availability of counterpart funds and for audits, for which there were considerable delays - about nine months in the case of the audit of the 1991 accounts). The most serious breach of covenant is the failure of the Borrower to make use of the results of the permanent household survey and other studies in the formulation of social policies and socio- economic development programs (Section 3.05 of the DCA). The Borrower performance on compliance with covenants can only be rated as deficient. ASSESSMENT OF OUTCOME 1.25 The project achieved most of its major objectives and has achieved or is expected to achieve satisfactory development results with only a few shortcomings. Therefore, the project's outcome deserves a rating of "satisfactory". Generally, the project has been successful in putting into place essential tools, such as databases, surveys and studies,  9 which have been made readily available to policy makers. There has been considerable transfer of skills for the household surveys, but unfortunately not for the studies. Despite the wide dissemination of all those data and results of surveys and studies (which allowed for the beginning of a fairly widespread dialogue on issues of social policy and poverty reduction), their policy impact has, so far, been relatively limited, as has capacity building outside MPC. Funding provided to communities through the Pilot Program has helped to finance a number of sustainable community-based initiatives, build local capacity to better prepare and implement community-level development activities, as well as greatly improve collaboration between Government, NGOs, and local communities. However, communities' needs for services, particularly in remote areas in the Upper and Middle Guinea regions, remain vast. FUTURE OPERATION 1.26 The concept of future project operation is not really applicable to a project of this type, particularly to the Social Policy Planning and the Living Standards Monitoring components. However, most of the assets financed under the Pilot Program will continue to be used and "operated"; as for poverty monitoring, its continuation is very much dependent on the availability of foreign financial assistance. In November 1994 IDA discussed with Government the need to continue and expand on the achievements of the present project and agreed with Government on an action plan for the preparation of a new operation. In line with the Government request, the objectives of that new operation would most likely be similar to those of the first project. They would be to: (a) strengthen Government capacity to monitor the poverty situation in the country, undertake social policy analysis, and plan and develop appropriate social programs and interventions; and (b) improve the living conditions of the poor in rural and urban areas by supporting targeted community-level initiatives. 1.27 The design of a new operation should incorporate the lessons learned from the experience of this Socio-Economic Development Support Project (see section below). In particular, to address the issue of lack of policy impact of the present project, mechanisms would need to be established to ensure better coordination among ministries in defining and implementing social policies. Therefore, the proposed operation should adopt an approach emphasizing a more integrated, participatory process of consultation and dialogue. This process should involve complementing the surveys undertaken under the present project with qualitative surveys, such as beneficiaries assessments, and workshops involving Government, NGOs and other members of civil society (such as research institutions). Any new social fund component should be designed to be demand- driven, participatory and autonomous. Unfortunately, the Government has not followed the action plan agreed upon in late 1994 and the preparation of a new operation has been seriously delayed. Therefore, activities may be completely interrupted because of a lack of financing between the last disbursement on credit 1995-GUI and the effectiveness of the new credit for any possible follow-up project.  10 KEY LESSONS LEARNED 1.28 The following lessons, which are relevant for future projects both in the social sectors and in Guinea, can be learned from the Socio-Economic Development Support Project: