China - Gansu Provincial Development Project : Part 2 - Education Component

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 16422-CHA IMPLEMENTATION COMPLETION REPORT CHINA GANSU PROVINCIAL DEVELOPMENT PROJECT (LOAN 2812-CHA/CREDIT 1793-CHA) PART II-EDUCATION COMPONENT March28, 1997 Rural and Social Development Operations Division China and Mongolia Department East Asia and Pacific Regional Office 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.  CURRENCY EQUIVALENTS Currency Name = Renminbi Currency Unit = Yuan (Y) At appraisal: $1 = Y 3.7 At completion: $1 = Y 8.3 FISCAL YEAR January 1 - December 31 ACADEMIC YEAR September I - June 30 ABBREVIATIONS AND ACRONYMS BOE - Bureau of Education EPIO - Education Project Implementation Office FILO - Foreign Investment and Loan Office GEI - Gansu Education Institute GIER - Gansu Institute for Educational Research GPIO - Gansu Project Implementation Office ICB - International Competitive Bidding ICR - Implementation Completion Report LCB - Local Competitive Bidding MOF - Ministry of Finance PBOE - Provincial Bureau of Education SEdC - State Education Commission SOE - Statement of Expenses SPC - State Planning Commission TA - Technical Assistance UBE - Universal Basic Education Vice President : Jean-Michel Severino, EAP Director : Nicholas C. Hope, EA2 Division Chief : Joseph Goldberg, EA2RS Staff Member : Sandra Erb, Consultant (Education), EA2RS  FORWARD FOR OFFICIAL USE ONLY 1. Project Background. The Gansu Provincial Development Project comprises three components for agriculture, education and industrial diversification. The Project was identified based on the findings of a 1986 Bank study, Growth and Development in Gansu Province, carried out to assist the Central and Provincial Governments in developing an overall strategy for income growth and poverty reduction. In the early 1980s, 41 percent of Gansu's population lived in poverty, compared to 13 percent nationally, and rural per capita incomes were the lowest nationwide. The Bank study identified a range of issues facing the province but found three problems acute. First, incomes and living standards in the province's upland region of Dingxi were found particularly low. Dingxi had 30 percent of the provincial population -- almost all employed in agriculture, a larger proportion of rural poor, irrigation of only 13 percent of the cultivated area and a shortage of drinking water, and an urgent need for land rehabilitation to counter erosion of the loess soils and to introduce appropriate agricultural production systems. Second, restrictions on labor mobility combined with unsustainable pressure on the province's fragile natural resource base argued for the development of labor-intensive rural industries relying on low-cost labor. Third, improvement of the educational system, particularly of teacher training in basic education, was identified as critical, in view of international experience showing education's prime role in allowing mobility to more remunerative nonagricultural employment, adoption of improved agricultural technology, and -- for women -- fertility reduction, improvement in family health and retention of children in school. 2. Project Design. To address these problems, three separate projects were prepared and appraised. However, when the amount of Bank Group assistance for education and industrial diversification had to be scaled back to reflect provincial repayment capacity, the three operations in different sectors were processed together as components of a single Gansu Provincial Development Project, financed by Ln. 2812/ Cr. 1793-CHA. The agriculture component received $130 million equivalent of credit proceeds, the education component $20 million equivalent of IDA funds, and an IBRD loan of $20 million and credit proceeds of $500,000 equivalent went to industrial diversification. 3. The project's agriculture component comprised construction of the technically challenging 57,000-ha Yindaruqin irrigation scheme, settlement of the irrigated area by 15,000 poor farm families from nearby resource-poor areas, land improvement over 75,000 ha in Dingxi's Guanchuan River Basin, and institutional support. The education component included upgrading of facilities for training primary school teachers, expansion of facilities for training lower secondary school teachers, increased in-service teacher training via expansion of television training facilities, improved science education in 400 lower secondary schools in poor counties, and support to enhance education administration and management. In support of industrial diversification, the project provided a $20 million line of credit to finance small- and medium-sized subprojects in rural and light industry, as well as training and technical assistance for the enterprises 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.  ii assisted and the project financial intermediary, the Gansu Investment and Trust Company (GITC). While the province assumed the interest rate and exchange rate risks on the Bank loan, GITC bore the commercial risk. 4. Project Outcome. The project's agricultural and education activities were, overall, successfully implemented, although a two-year extension of the credit was required to complete the agriculture component's Yindaruqin Irrigation Subcomponent. That subcomponent, entailing major tunneling works with difficult site conditions and complex engineering, suffered from poor performance by some contractors, lack of counterpart funds, and bureaucratic land settlement processes. Some on-farm works and land settlement activities are still ongoing with local funding. The Guanchuan subcomponent in Dingxi raised farmers' incomes by almost 250 percent three years after completion of works, while net incomes of farmers in the Yindaruqin area have eventually increased by 136 percent for the low-income group and by 55 to 60 percent for others. The land rehabilitation program tested under this and other projects has been subsequently refined and used in the Loess Plateau Watershed Rehabilitation Project (Cr. 2616), among others. 5. The education component, the first Bank Group education operation focused on only one province, increased the number of qualified primary and lower-secondary school teachers, improved the quality of science teachers and education in poor counties, and improved the capabilities of education administrators in the design, development, and implementation of educational programs. The capacity building for educational administrators and managers was important for continued improvement of the system. The administrators and managers trained under this project helped design and implement the subsequent Third Basic Education Project (Cr. 2831 -CHA). 6. The industrial diversification component attempted to raise rural incomes in resource-poor areas with limited agricultural potential and a population surpassing the carrying capacity of the land. Since labor migration in China at the time was allowed only in the context of limited, officially sanctioned programs like the one under this project's agriculture component, the project attempted to provide in-situ assistance to the rural poor by promoting nonagricultural employment. While the provincial study cautioned planners "to look carefully at the policy and institutional environment that would facilitate development of productive nonagricultural jobs in Gansu" (para. 3.01), implying inadequacy in the current environment, the severity of rural poverty in Gansu, where some parts of the population had to rely on government provision of grain, water and fuel relief, was considered adequate justification for piloting limited support to employment diversification. 7. Implementation of the component showed the project's goals in the sector to be overambitious and the study's warning to be justified. While 17 subprojects received funding for modem equipment and technology and small civil works, financial performance of the beneficiaries -- 55 percent of which were non-state rural enterprises -- suffered from many problems. Among these were subborrowers' inexperience in enterprise management, shortages of counterpart funds during implementation and of  iii working capital during production, and economic reforms introduced during the project period that caused enterprise costs to rise significantly and demand for their products to fall. With most project enterprises still producing at less than 50 percent of capacity, their loan repayment to GITC suffered as did GITC's financial condition. Positively, however, technical assistance and training provided under the project introduced provincial planners to the concepts of financial and economic analysis of investments, and this appreciably improved local planning capabilities. 8. Assessment of Project Strategy. The project responded appropriately to provincial needs as identified in the Bank Group study. It also provided experience with various types of sectoral interventions aimed at poverty alleviation. Although this project predates introduction of the current Bank Group poverty alleviation strategy in China, with its targeting of whole operations to specific poor counties identified by the central and provincial governments, the agricultural component was well focused by emphasizing the Dingxi Region. The education component addressed the province's general need for better qualified teachers and did target poor counties for improved science teaching. Moreover, it was followed by the poverty-targeted basic education project series, including the Third Basic Education Project which covers Gansu and six other provinces. The industrial diversification component required about half of the subprojects to be in rural areas. 9. The issues with respect to rural industrial development are its difficulty as well as its value relative to other possible interventions for poverty alleviation. Experience internationally indicates a high failure rate in town and village enterprises, and the ongoing China Southwest Poverty Reduction Project (Ln. 3906/Cr. 2744-CHA), a well planned, integrated multi-sectoral initiative in Guangxi, Guizhou and Yunnan Provinces, has in its first year disbursed little for a small township and village enterprise development component. This suggests the difficulty in using rural industrial development as a poverty alleviation tool. 10. The Gansu Provincial Development Project's highly successful land development component in Guanchuan proved the effectiveness of using a package of measures to improve loess soils. In much of the Loess Plateau, covering 640,000 square kilometers of Gansu, Shaanxi, and Shanxi Provinces and the Autonomous Regions of Inner Mongolia and Ningxia, good new land can be readily and cost-effectively created by mechanized and manual terracing of the soft soil, where slopes are not too steep and population has not yet exceeded carrying capacity. Using the approach tested under this project, the Bank Group-financed Loess Plateau Project (Cr. 2616-CHA) being carried out in several provinces including Gansu, the Shanxi Poverty Alleviation Project (Cr. 2834-CHA) and the Gansu Hexi Corridor Project (Ln. 4028/Cr. 2870-CHA) are raising agricultural productivity and the incomes of very poor farmers over a wide area of the Yellow River basin. 11. Summary. Although the Gansu Provincial Development Project lacked some of the design sophistication now brought to the Bank Group's poverty reduction efforts in China, it significantly improved the incomes of very poor farmers, enhanced educational  iv quality in poor and other areas of the province, and demonstrated the difficulty of rural enterprise development. The land improvement package tested under the project proved a highly effective means of raising agricultural productivity and reducing poverty. The follow-up Loess Plateau, Shanxi Poverty Alleviation and Gansu Hexi Corridor Projects are now replicating and building upon the significant achievement of the earlier initiative.  CONTENTS PREFACE ........................................................ii EVALUATION SUMMARY ........................................................v PART I: PROJECT IMPLEMENTATION ASSESSMENT .................................1 A. Project Objectives .......................................................1 B. Achievement of Project Objectives ....................................................... 4 C. Implementation Record and Major Factors Affecting the Project ...............7 D. Project Sustainability .......................................................8 E. IDA Performance .......................................................9 F. Borrower Performance .......................................................9 G. Assessment of Outcome ...................................................... 10 H. Future Operation ....................................................... 10 J. Key Lessons Learned ...................................................... 10 PART II: STATISTICAL TABLES ....................................................... 11 Table 1: Summary of Assessments .1 Table 2: Related Bank Loans/Credits (Education Component) .12 Table 3: Project Timetable .13 Table 4: Loan/Credit Disbursement: Cumulative Estimate and Actual .13 Table 5: Key Indicators For Project Implementation .14 Table 6: Studies Included in Project .15 Table 7A: Project Costs in $ Million ........................................... 15 Table 7B: Project Costs in Y Million ........................................... 15 Table 8: Key Indicators for Project Operations ........................................... 16 Table 9: Economic Costs and Benefits ............................................ 16 Table 10: Status of Legal Covenants ........................................... 16 Table 1 1: Compliance with Operational Manual Statements ........................ 17 Table 12: Bank Resources: Staff Inputs (All Components) .......................... 17 Table 13: Bank Resources: Missions ............................................ 17 ANNEX A: MISSION AIDE MEMOIRE ................................................. 19 ANNEX B: BORROWER'S CONTRIBUTION TO THE ICR ........................... 22 ANNEX C: BORROWER'S OPERATION PLAN ............................................... 39   - 111 - IMPLEMENTATION COMPLETION REPORT CHINA GANSU PROVINCIAL DEVELOPMENT PROJECT (LOAN 2812-CHA/CREDIT 1793-CHA) EDUCATION COMPONENT PREFACE This is the Implementation Completion Report (ICR) for the Gansu Provincial Development Project: Education Component, for which Credit 1793-CHA in the amount of SDR 15.83 million or $20.0 million equivalent was approved on May 12, 1987 and closed on June 30, 1995, with one extension of a year of the original closing date. The last disbursement was made on July 13, 1994, and the total disbursements were 100 percent of the credit amount. The ICR was prepared by Sandra Erb, EA2RS, of the China and Mongolia Department of the East Asia and Pacific Regional Office and reviewed by Joseph Goldberg, Division Chief, and Yo Kimura, Project Advisor. The borrower provided comments that are included as an appendix to the ICR. Preparation of this ICR was begun during the Bank's final supervision/completion mission September 21-23, 1994. It is based on materials in the project files as well as those received during the completion mission. The borrower participated in preparation of the ICR by contributing views reflected in the October 19, 1994 project completion mission Aide Memoire, preparing their own evaluation of the project's execution and preparation and commenting on the draft ICR.   - v - CHINA GANSU PROVINCIAL DEVELOPMENT PROJECT (LOAN 2812-CHA/CREDIT 1793-CHA) EDUCATION COMPONENT EVALUATION SUMMARY Project Objectives and Description 1. In 1984, the Government of China stepped up its 1979 reform agenda by adopting a plan that emphasized the need for breakthroughs in areas such as upgrading managerial personnel to meet the new demands in a reformed economy; advanced technology and scientific research; and systemic reforms of education and training to develop China's human capital potential. This was followed by a May 1985 "Decision on Reform of the Education Structure," which called for, inter alia, universalizing nine years of basic education and strengthening education management at all levels. In 1986, the Government of China passed the "Compulsory Education Law" under which nine-year Universal Basic Education (UBE) was to be achieved by the year 2000. As decreed by the central government, the Gansu provincial government was then developing action plans to universalize basic education, and then initiated a series of actions designed to support the achievement of UBE and improve the quality of basic education. This component of the Gansu Provincial Development Project supported the Government's efforts to achieve UBE and improve the quality of education in primary and lower secondary schools in Gansu Province chiefly by increasing numbers, qualifications, and status of teachers. To achieve this goal, the project set out to: (a) increase the output of qualified lower secondary school teachers by expanding the capacity of five normal colleges from about 3,500 to 8,200 to accommodate both the preservice and inservice trainees; (b) improve the quality of preservice primary teacher training by upgrading the facilities of 23 normal schools; (c) reduce the number of unqualified teachers by assisting the Gansu TV Education Institute to expand its inservice training program to cover the entire province through the establishment of prefectural and local training centers; (d) improve science instruction in the 400 lower secondary schools in poor counties; (e) improve the quality of education administration through the establishment of a Center for School Administration to train school and government education administrators; and (f) improve the management of education through assistance for continuing the development of a new school supervision system and for planning improvement to the system for managing educational information.  - vi - Implementation Experience and Results 2. During the five-year project implementation period, the overall implementation of the project went well. The total credit amount of SDR 15.83 million ($20 million equivalent) was disbursed and the indicators to monitor overall progress under the project (Table 5) were met or exceeded. The Gansu Implementation Office operated throughout the life of the Project and provided the necessary oversight required for smooth implementation activities associated with each institute such as civil works, procurement of project equipment, purchase of books and training. 3. Achievements of project objectives as measured by the development impact indicators set out in the Staff Appraisal Report (SAR) can be summarized briefly, (a) Normal College regular enrollments were overachieved but inservice targets were not met; (b) Normal School enrollments were not met but graduate targets were overachieved; (c) lower secondary science targets were met; (d) the TV Education Institute targets were met or surpassed; (e) the Training Center for School Administration achieved its enrollment targets; and (f) the technical assistance targets were also met. 4. During the implementation of the project, China suffered considerable inflation in 1993, which increased the costs of building materials substantially, thus having an impact on project-supported civil works. During that period of time, some of the project- supported civil works came to a halt, and it was only after new agreements were reached with contractors in 1994 that it was possible for the full civil works programs to continue. Although this did not have an impact on the final targets of the overall project, there was serious delay for one year in the procurement of project-supported civil works. 5. The project was designed based on close cooperation between IDA and the Gansu Provincial Government. This was the first Bank Group project in education with an individual province and therefore, it was essential to establish good communication channels with the Provincial Government. The Bank Group mobilized a team of qualified experts to work with the Gansu Provincial Education Bureau and the county education bureaus so that the province could be prepared to play a larger role in the preparation of future projects. IDA supervision missions visited Gansu and continuously monitored the implementation of the Project. The overall assessment of IDA's performance was satisfactory. In line with a good record in designing, preparing and implementing the IDA-assisted education projects, Gansu Province demonstrated satisfactory performance in preparing and implementing the first IDA Provincial Loan. 6. Major factors affecting the implementation of the project were: (a) acceleration of the national goals to achieve UBE gave strong impetus to the provincial authorities to move forward their own teacher training goals, especially in the area of science teaching; (b) moderate increases in national categorical funding for poor and minority children's student assistance started to be allocated to Gansu Province, augmenting scarce resources to support education at the provincial level; and (c) the national policy on production of  - vii - TV courses changed from emphasis on provincially produced and recorded programming to nationally produced and satellite transmitted material. Summary of Findings, Future Operations, and Key Lessons Learned 7. Overall Outcome. The overall Project outcome is rated as satisfactory. The Provincial Government was able to increase the number of qualified primary and lower- secondary school teachers, improve the quality of science teachers and science education and improve the quality of education administrators. National education projects developed through the State Education Commission (SEdC) in Gansu Province have shown that the Gansu Education administrators have a high level of capacity for both design, development and implementation. During the preparation of the Third Basic Education Project (Cr. 2831 -CHA), the IDA team was able to use the Gansu Institute for Educational Research (GIER) as well as the staff of the Gansu Education Bureau to conduct analytical work associated with a household survey used in the economic and financial analysis for the project. This illustrates the institution and capacity building that has resulted from the Gansu Education project. 8. Sustainability. Measures of project sustainability are faculty and education administration training and development as well as operation and maintenance of facilities and equipment and enrollment. All of the civil works construction was completed by 1994. The quality of the construction seemed good, with facilities only starting to show signs of wear from normal use. SEdC and the Gansu Provincial Bureau of Education will need to pay particular attention to the maintenance of the facilities constructed under the project and start a regular maintenance program. Large numbers of faculty and staff were trained during project implementation which, no doubt, contributed to improvements in faculty qualifications. However, to sustain the investment, the province will need to allocate the necessary resources to continue the upgrading of staff in both the project and nonproject area. Of particular importance is the provision of science training for nonproject areas so that they can reap the gains in science education that the project areas have gained. The province will need an overall professional development strategy that is continuously updated. 9. Future Operations. The Government and the Association discussed an outline for the attached Operation Plan (Annex C) during the October 1994 implementation completion report mission. The report reflects the decision of the Government to continue the financial support necessary to sustain the gains made in the project as well as ways to further promote the implementation of science education in the nonproject areas. The Operation Plan provides estimated levels of support for maintaining facilities, faculty development, and expanding lower secondary science education. The Government of China, Gansu Province and the Association have negotiated a Third Basic Education project which builds on and expands considerably the experiences of the Gansu Education Project and through the Basic Education III project the Province and the Association will be able to monitor the progress of teacher training institutes as they begin to work toward sustaining the benefits of this project.  - viii - 10. Lessons Learned. The main lessons learned from the component's implementation are: (a) single-province projects demonstrate the advantage of focused Association and provincial attention to a limited number of important provincial goals and bring to implementation the energy and concentration necessary to attain the goals; (b) the education component of this multisectoral project benefited from the high level and continuing attention of a group of provincial policymakers responsible for carrying out the full range of Association-supported project activities; (c) the provincial focus afforded both the province and the Association the opportunity to bring to bear provincial resources, such as GIER, which through its research, added value to both this and subsequent Association activities in Gansu; and (d) for projects carried out during periods of unforeseen inflation, project supervision needs to be increased during the inflationary periods to prevent slippage in attaining goals, especially in the area of counterpart funding.  - 1 - CHINA GANSU PROVINCIAL DEVELOPMENT PROJECT (LOAN 2812-CHA/CREDIT 1793-CHA) EDUCATION COMPONENT PART I: PROJECT IMPLEMENTATION ASSESSMENT A. PROJECT OBJECTIVES 1. Project Objectives and Scope. The project sought to support the Government's efforts to achieve Universal Basic Education (UBE) and improve the quality of education in primary and lower secondary schools in Gansu Province by increasing enrollment ratios and improving the status of teachers. To achieve this goal, the project set out to: (a) increase the output of qualified lower secondary school teachers by expanding the capacity of five normal colleges from about 3,500 to 8,200 to accommodate both the preservice and inservice trainees; (b) improve the quality of preservice primary teacher training by upgrading the facilities of 23 normal schools; (c) reduce the number of unqualified teachers by assisting the Gansu TV Education Institute to expand its inservice training program to cover the entire province through the establishment of prefectural and local training centers; (d) improve science instruction in the 400 lower secondary schools in poor counties; (e) improve the quality of education administration through the establishment of a Center for School Administration to train school and government education administrators; and (f) improve the management of education through assistance for continuing the development of a new school supervision system and for planning improvement to the system for managing educational information. 2. The project development impact indicators' were: (a) increase Normal College preservice enrollments and graduates from 3,291 and 240 in 1986 to 5,800 and 2,400 respectively in 1992, and increase the teaching staff from 635 in 1986 to 1,025 in 1992; (b) increase Normal School enrollments and number of graduates from 14,257 and 3,894 respectively in 1986 to 17,000 and 4,500 in 1992; (c) strengthen lower secondary school science by building 400 labs, training 800 science teachers and 400 laboratory assistants by 1992; (d) expanding, by 1992, the offerings of the TV Education Institute by opening 393 new centers, offering 8 new courses, and enrolling cumulative totals of 36,000 primary school teachers, 29,000 lower secondary school teachers, 7,000 certificate- seeking primary school teachers; and 7,500 lower secondary school teachers; 1 Project development indicators have been extracted from the text of the Staff Appraisal Report and reviewed during the ICR mission.  - 2 - (e) increasing the numbers of students enrolled in and graduated from the Center of School Administration from 50 and 0 respectively, in 1986 to 400 and 200 in 1992, and (f) by providing 300 person-months of domestic and 6 person-months of international technical assistance to improve the educational management information system. 3. Sector Development Objectives. At the time of appraisal, the Bank Group's lending strategy consisted of four lines of action: (a) support for basic education and teacher training; (b) increased emphasis on the education and training needs of economic sectors that the Government and the Bank Group consider priorities for development; (c) support for technical and vocation education; and (d) continued support for higher education. 4. In early projects, the Bank Group focused on the development of higher education, in accordance with the Government's priorities. In addition, the Bank completed sector work in support of the Government's policy to expand the vocational and technical education systems to meet the growing needs for skilled manpower and technical assistance in management education. The Gansu basic education project was the first Bank effort to assist the Government in their efforts to train primary and lower secondary school teachers and improve the quality of educational administration at those levels in one province. This was done in response to the Government's desire to achieve UBE through financial support directed at the expansion and improvement of inservice training of lower secondary school teachers, the provision of textbooks and other learning materials and relevant technical assistance. 5. Policy Context. To address problems of economic inefficiency and structural imbalance, the Government initiated a program of reform and adjustment in 1979 that focused primarily on invigorating China's rural economy. In 1984, the Government reaffirmed and consolidated the positive results of the earlier reform and adjustment program and adopted a reform plan that emphasized the needs for breakthroughs in areas such as: (a) upgrading managerial personnel to meet the new demands in a reformed economy; (b) extending utilization of foreign capital, advanced technology and scientific research; and (c) systemic reforms of education and training to develop China's human capital potential. 6. In May 1985 the Central Committee of the Communist Party announced its "Decision on Reform of the Education Structure." The reform called for universalizing nine years of basic education, expanding vocational and technical education at secondary levels, increasing enrollment and autonomy of higher education institutions, and strengthening education management at all levels. On the basis of the decision to reform the education structure, the Government passed the "Compulsory Education Law" in 1986, under which nine-year UBE was to be achieved in stages: (a) in the cities and coastal areas by 1990; (b) in towns and villages with a medium level of development by 1995; and (c) in the more remote areas, at rates commensurate with the economic development of each area. This policy was reconfirmed in the outline for "Reform and  Development of Education in China" issued by the Central Committee of the Communist Party of China and the State Council in February 13, 1993. 7. As decreed by the central government, the Gansu provincial government developed plans to universalize basic education. (Gansu was and is classified as an economically backward area and thus set its own timetable for achieving UBE.) In the initial stages, the province strove to achieve eight-year basic education, based on five years of primary school and three years of lower secondary school. In his discussion of the then new Compulsory Education Law, Li Peng, then Vice Premier and Chairman of SEdC, noted the difficulty poor provinces would have in financing nine years of compulsory education and stated "we should allow the existence of the five-and-three academic system in the transitional period."2 Thus, provincial plans for achieving compulsory school were consistent with the national policy. Within this framework, the provinces decided to devote a major effort to first achieving universal (five-year) primary education and then expanding access to lower secondary school. Full student participation in a primary education program was to be realized in all but a few remote areas between 1990 and 1995; the net enrollment rate in 1995 was projected to be 95 percent. Full lower secondary participation was to be attained in about half of the counties by 2000 with the remainder reaching this standard subsequently; province-wide, the 1995 enrollment rate was projected to be about 65 percent. The actions taken by the province in reaching UBE and improving the quality of education were to serve as a model for other poor provinces in China faced with similar problems. 8. Between 1985 and the time of project appraisal in late 1986, the province had initiated a series of actions designed to support the achievement of UBE and improve the quality of basic education. These initiatives formed a coordinated action program with three objectives: (a) to increase enrollments in basic education; (b) to assure a supply of well-qualified teachers; and (c) to provide adequate school facilities. To achieve these objectives, the province planned to: (i) assist poor families to pay school fees; (ii) encourage girls to enroll in school; (iii) expand the capacity to train lower secondary teachers; (iv) expand teacher upgrading programs to cover all unqualified primary and lower secondary teachers; (v) reduce the number of minban teachers; (vi) subsidize the salaries of existing minban teachers; (vii) repair dilapidated buildings: (viii) supply school furniture; and (ix) build appropriately located lower secondary schools. 9. Linkages between Project, Sector and Policy Objectives. In order to address both the sectoral and policy consideration outlined above, the Association and the Government developed a project that laid out the following objectives: (a) increase the output of qualified lower secondary school teachers; (b) improve the quality of preservice primary teacher training; (c) reduce the number of unqualified primary and lower secondary schools teachers in the province be assisting the Gansu TV Education Institute 2 Li Peng, "Explanation of the Compulsory Education Law (draft) of the People's Republic of China" made at the fourth session of the Sixth National People's Congress, April 2, 1986.  - 4 - to expand its training programs; (d) improve science instruction at the lower secondary level; (e) improve the quality of educational administration through the establishment of a center for School Administration; and (f) increase the efficiency and cost-effectiveness of provincial level education administration. 10. The major risk perceived at the time of appraisal was the possible delays due to the inexperience of the provincial officials in the implementation of an IDA-financed project. In particular, the provincial officials were not familiar with procurement procedures that conformed to Bank guidelines. However, the risks were seen to be manageable. The project included technical assistance from central government staff experienced in implementing Bank projects. International competitive bidding (ICB) procurement was to be conducted by China National Tendering Import/Export Corporation (CNTIC), the central agency responsible for ICB in China, which had extensive experience with Bank-financed projects. In addition, Bank staff provided training on project implementation through seminars and planned to continue to do so during supervision. B. ACHIEVEMENT OF PROJECT OBJECTIVES 11. Project Development Indicators. Achievements of project objectives can be partially measured by reviewing the development impact indicators found in para. 2. Briefly, (a) Normal College regular enrollments were overachieved but inservice targets were not met; (b) Normal School enrollments were not met but graduate targets were overachieved; (c) lower secondary science targets were met; (d) the TV Education Institute targets were met or surpassed; (e) the Training Center for School Administration achieved its enrollment targets; and (f) the technical assistance targets were also met. More details and additional evaluative materials can be found in the following paragraphs and Table 5, Key Indicators of Project Implementation. 12. Enrollment-Normal Colleges. By the end of the Project, enrollments in the five Normal Colleges were 38.0 percent higher than the SAR targets and the number of graduates was about 11 percent higher than the SAR targets. However, the number of inservice teachers was only 47 percent of the SAR target. The reason put forward by the Gansu authorities for the failure to achieve the inservice teacher training targets was that: (a) the State Education Commission (SEdC), during the implementation of the project, had instituted a policy of improving overall quality of the teaching force in the country by extending the two-year preservice training programs for lower secondary schools to three years at the normal schools. As a result of this policy implementation, the preservice enrollment of the five project normal colleges increased remarkably, as students must now stay on campus for an additional year, and thus occupied a larger proportion of the training capacity of these normal colleges; and (b) at the same time, the alternative inservice teacher training programs have expanded significantly. These programs include: (i) educational colleges that are specialized in inservice training only; (ii) TV universities; (iii) TV teachers colleges, and (iv) correspondence schools. In particular, since 1993, a new inservice teacher training program, which combines the advantages of  - 5 - the three different modes of inservice teacher training-TV instructional courses, correspondence programs, and self study and tutoring-have been developed and enrolled high numbers of lower secondary teachers in Gansu. 13. Enrollment-Normal Schools: Under the project the 23 normal schools were to increase their standards for instructional equipment for science, language laboratories, computers, audiovisual equipment and the arts. During the project, all 23 normal schools purchased 130 percent of the required equipment, thus allowing the schools to meet the SEdC standards for normal schools. By reaching this goal, the normal schools are now better able to upgrade the skills of minban3 teachers as well as gongban4 teachers. Normal schools were also to increase the enrollments of full-time students by approximately 20 percent. As the indicators (Table 5) show, the normal schools have experienced a slight increase (approximately 6 percent) in overall enrollments, lower than originally expected. As a result, by the end of the project, Gansu was considering merging smaller normal schools with larger ones in order to achieve efficiency gains in their normal school system. In addition, normal schools were beginning to upgrade the skills of minban teachers in an effort to convert them to gongban teachers. This is seen as an accomplishment because minban teachers are, in many instances, viewed by local committees as the most dedicated and motivated teachers with many years of experience. Minban teachers are also well adjusted to life in the rural areas and like the children and manage the schools well. 14. Improve Science Instruction in Lower Secondary Schools. The project invested in improving the quality of science education in lower secondary schools by: (a) building one or two laboratories and a storage and preparation room at each school; (b) purchasing equipment of class-three standard for each school; and (c) training all science teachers and laboratory assistants in all 400 schools. As a result of the project, all of the 400 lower secondary schools are able to provide SEdC-prescribed experiments (minimum-level science experiments that are related to specific grade-level curricula taught in secondary institutions) because of the availability of the equipment and the improved abilities of the teachers due to training. In addition, students' science test scores improved during the life of the project. The improvements were measured by Gansu Province in a study conducted under the project, which showd that students' marks on science subjects were higher than those of nonproject schools that lacked teaching aids and special training for science teachers. Because of the improvements experienced in project schools, Gansu has developed a plan to: (a) continue the long-term and short- term training of teachers, (b) support the repair and replacement of teaching aids 3 Minban teachers are locally hired and supported teachers, many of whom have not received formal teacher training before the start of their work. 4 Gongban teachers are government hired and paid teachers with higher levels of initial preservice training than minban teachers.  - 6 - annually; and (c) provide 200 of the remaining 600 lower secondary schools with the necessary equipment to reach the same goals by the year 1999. 15. Gansu TV Education Institute Program. The Project provided equipment and technical assistance for inservice training of teacher who were being trained by the TV Education Institute using video tapes and books. This component was able to reach all the projected targets. The province opened 393 new TV education centers with appropriate equipment, and provided all the required inservice training of primary and lower secondary teachers for certification. This has contributed to improved quality of the teachers in Gansu Province. The original goal of producing 400 programs annually was revised due to the fact that during the life of the project the Beijing-based China TV Normal College, which disseminates programs through a satellite network, decided that production of courses could be shared by all provinces, thereby reducing the need for each province to produce all of its own programming. Rather than have each province produce its own materials, introduction of the national satellite network was seen as a more efficient mechanism for providing the inservice teacher training programming. Therefore, the reduction of this target in the project is seen as an improvement in efficiency for the national training system. The province will continue to support TV education by expanding the number of centers by 75 and providing the necessary funding to maintain the current 1,644 centers. 16. Center of School Administration. The center for school administration was designed to offer training for provincial-, prefecture- and county-level education administrators. The center completed all of the estimated construction and is now providing inservice training for approximately 200 education administrators and middle school principals annually. The Center is also preparing to increase the number of preservice students from 400 to 480 annually and will be training three trainers annually for the next five years. With the unprecedented reform and decentralization of the education system, Gansu education administrators will need continuous training so as to be able to understand how best to utilizes the scarce resources available to education and to cope with the rapid changes occurring in education. As evidenced above, the Gansu Education Bureau has not only completed the project goals but has made a detailed five- year plan to sustain and improve the training system. 17. Civil Works, Equipment and Furniture. The majority of project funds was spent on construction of facilities, equipment and books. Civil works construction was completed by the end of 1994. A total of 265,000 m2 or 94 percent of the total original target in the SAR was constructed. The 400 lower secondary schools laboratories, amounting to 92,000 m or 100 percent of the original target was completed in 1991 with the use of local funds. The remainder of the construction was for the other project institutions of which 173,000 m or 91 percent of the nonlab construction was completed. The reduction occurred as a result of significant cost increases in building materials and labor. The quality of the construction completed seemed good. Now, however, after a few years some of the facilities are beginning to show signs of wear from normal use. In order to sustain this investment, the Provincial Education Bureau will need to pay  - 7 - particular attention to the maintenance of facilities constructed under the project. In an effort to address this issue, the Province will provided a budget allocation for maintenance of all facilities and equipment as indicated in Part II Operation Plan. 18. The equipment and furniture purchased assisted the Normal Colleges, Normal Schools and Lower Secondary Schools in the project to offer all or almost all of the SEdC-prescribed experiments (minimum-level science experiments which are related to specific grade-level curricula taught in secondary and post-secondary educational institutions), improve computer literacy and enhance the libraries. The effectiveness of the equipment will diminish rapidly if funds are not made available for maintenance, consumable and replacement equipment and parts. The Provinces indicated that it will provide a budget allocation in order to maintain the efficiency of the equipment, which can be seen in Part II Operation Plan. 19. Technical Assistance (TA). Improving the quality of school supervision, science teachers and laboratory technicians were major project goals. The project sought to achieve this goal by supporting inservice training for existing teachers and administrators through Normal Colleges and Schools as well as the establishment of the Center for School Administration. In each category (see Project Indicators, Table 5) the project targets for the number of teachers and administrator were exceeded. These teachers and administrators have undoubtedly contributed to improving basic education system of Gansu. In particular, there has been marked improvement in lower secondary science teaching. This assertion was borne out in the findings of the science education study conducted by Gansu Institute for Educational Research (GIER); passing rates in all science subjects improved from between 12 and 14 percent in project schools. However, the Gansu Education Bureau implementation unit did experience difficulties in organizing study tours and visits of foreign experts, thereby prolonging the implementation of these TA activities until the end of the project. Overall, these activities were judged to be useful for the Gansu education administrators, although the full, long-term impact of the activities could not be ascertained due to late implementation. There should have been the more focus during the project implementation of these activities so that benefits could be realized during the life of the project. 20. Studies. During the project the three studies were conducted: (a) forecast of demand and supply of primary and lower secondary school teachers (1990-2000); (b) a cost-effectiveness evaluation of inservice training of lower secondary, and (c) a report on improvement of science experiments in lower secondary schools. The findings of the studies were sent to the Association and were used in the preparation of the five-year completion report plan submitted to the Association. (See Part II.) C. IMPLEMENTATION RECORD AND MAJOR FACTORS AFFECTING THE PROJECT 21. Implementation Record. During the five-year project implementation period, the overall implementation of the project went well. The total credit amount of  - 8 - SDR 15.83 million ($20 million equivalent) was disbursed and the indicators to monitor overall progress under the project (Table 5) were met or exceeded. The Gansu Implementation Office operated throughout the life of the Project and provided the necessary oversight required for smooth implementation activities associated with each institute such as civil works, procurement of project equipment, purchase of books and training. 22. Major Factors Affecting the Project. Major factors affecting the implementation of the project: (a) acceleration of the national goals to achieve UBE gave strong impetus to the provincial authorities to move forward their own teacher training goals, especially in the area of science teaching; (b) moderate increases in national categorical funding for poor and minority children's student assistance started to be allocated to Gansu Province augmenting the scare resources to support education at the provincial level; and (c) the national policy on production of TV courses changed from emphasis on provincially produced and recorded programming to nationally produced and satellite transmitted material. 23. During the implementation of the project, China suffered considerable inflation in 1993, which increased the costs of building materials substantially, thus having an impact on project-supported civil works. During that period of time, some of the project- supported civil works came to a halt, and it was only after new agreements were reached with contractors in 1994 that it was possible for the full civil works programs to continue. Although this did not have an impact on the final targets of the overall project, there was serious delay for one year in the procurement of project-supported civil works. D. PROJECT SUSTAINABILITY 24. Measures of project sustainability are faculty and education administration training and development as well as operation and maintenance of facilities and equipment and enrollment. All of the civil works construction was completed by 1994. The quality of the construction seemed good, with facilities only starting to show signs of wear from normal use. SEdC and the Gansu Provincial Bureau of Education will need to pay particular attention to the maintenance of the facilities constructed under the project and start a regular maintenance program. 25. For project institutions to continue to obtain value from their project-supported investments, they will need to ensure efficient use of the equipment and materials. Project institutions need to provide adequate resources to maintain and service the existing equipment. The best way to sustain the physical plant investment will be for municipal, provincial and prefectural authorities to systematically provide necessary recurrent funding annually for the maintenance. In addition, it will be important for Gansu to assess the costs associated with expanding the lower secondary science component to nonproject schools. The study performed by GIER points to improvements in science scores in project schools that should be replicated in the nonproject areas.  - 9 - 26. Large numbers of faculty and staff were trained during project implementation which, no doubt, contributed to improvements in faculty qualifications. However, to sustain the investment, the province will need to allocate the necessary resources to continue the upgrading of staff in both the project and nonproject area. Of particular importance is the provision of science training for nonproject areas so that they can see the gains in science education that the project areas have seen. The province will need overall professional development strategy that is continuously updated. E. IDA PERFORMANCE 27. The project was designed based on close cooperation between IDA and the Gansu Provincial Government. This was the first Bank Group project in education with an individual province and therefore, it was essential to establish good communication channels with the Provincial Government. The Bank Group mobilized a team of qualified experts to work with the Gansu Provincial Education Bureaus and the county education bureaus so that the province could be prepared to play a larger role in the preparation of future projects either directly with the province or through national projects. IDA supervision missions visited Gansu and continuously monitored the implementation of the Project. 28. The Association also conducted a mid-term review of the project in April 1990 to assess the overall implementation of the project. The mid-term review attempted to strengthen the provincial education bureaus' focus the qualitative aspects of the project through discussions on the overall situation of nine-year compulsory education, technical assistance, education of girls, status of minban teachers and the findings of the three project studies. The overall assessment of IDA's performance was satisfactory. F. BORROWER PERFORMANCE 29. In line with a good record in designing, preparing and implementing the IDA- assisted education projects, Gansu Province demonstrated satisfactory performance in preparing and implementing the first IDA Provincial Loan. 30. Gansu Province Education Bureau coordinated with the County Education Bureaus to carefully develop proposals and collect the necessary data and information for project preparation. Officials from the Province received training on the development of projects during the preparation phase. 31. During implementation the province and counties worked closely together to facilitate the procurement of equipment, technical assistance, preparation of annual progress reports and audit reports sent to the Association. The Borrower also provided the necessary counterpart funds to complete the civil works in time to install and house all of the locally procured equipment in conjunction with the project. This was a particularly difficult responsibility in light of the accelerating inflation and building costs during the early stage of project implementation.  - 10- G. ASSESSMENT OF OUTCOME 32. The Project outcome is rated as satisfactory. The Provincial Government was able to increase the number of qualified primary and lower-secondary school teachers, improve the quality of science teachers and science education and improve the quality of education administrators. Passing grades in science in project schools improved substantially. National education projects developed through SEdC in Gansu Province have shown that the Gansu Education administrators have a high level of capacity for both design, development and implementation. During the preparation of the Third Basic Education Project (Cr. 2831-CHA), the IDA team was able to use GIER as well as the staff of the Gansu Education Bureau to conduct analytical work associated with a household survey used in the economic and financial analysis for the BEIII project. This speaks to the institution and capacity building that has resulted from the Gansu Education project. H. FUTURE OPERATION 33. The Government and the Association discussed an outline for the attached Operation Plan (Annex C) during the October 1994 implementation completion report mission. The report reflects the decision of the Government as to how to sustain the project for a five year period as well as ways to further promote the implementation of science education in the non-project areas. The Operation Plan provides estimated levels of support for maintaining facilities, faculty development, and expanding lower secondary science education. 34. As mentioned above, the Government of China, Gansu Province and the Association have negotiated a Third Basic Education project which builds on and expands considerably the experiences of this earlier project and through the Third Basic Education project the Province and the Association will be able to monitor the progress of teacher training Institutes of Education as they begin to work toward sustaining the benefits of this project. J. KEY LESSONS LEARNED 35. The main lessons learned from the project experience are: (a) single-province projects demonstrate the advantage of focused association and provincial attention to a limited number of provincial important goals and bring to implementation the energy and concentrate necessary to attain the goals; (b) the education component of this multisectoral project benefited from the high level and continuing attention of a group of provincial policymakers responsible for carrying out the full range of Association- supported project activities; (c) the provincial focus afforded both the province and the Association the opportunity to bring to bear provincial resources, such as GIER, which through its research, added value to both this and subsequent Association activities in Gansu; and (d) costing of civil works projects and other project procurement, within an inflationary period, is inherently difficult and therefore, project supervisions needs to be increased during these periods to ensure that there is not slippage in attaining goals, especially in the area of counterpart funding.  - I1 - PART II: STATISTICAL TABLES TABLE 1: SUMMARY OF ASSESSMENTS Achievement of Objectives Substantial Partial Negligible Not Applicable Macroeconomic policies x Sector policies x Financial objectives x Institutional development 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 Project Sustainability Likely Unlikely Uncertain x Bank Performance Highly Satisfactory Satisfactory Deficient Identification x Preparation assistance x Appraisal x Supervision x Borrower Performance Highly Satisfactory Satisfactory Deficient Preparation x Implementation x Covenant compliance x Operation (if applicable) Assessment of Outcome Highly Satisfactory Satisfactory Unsatisfactory Highly Unsatisfactory x  - 12 - TABLE 2: RELATED BANK LOANS/CREDITS (EDUCATION COMPONENT) Year of Loan/Credit Purpose approval Status Preceding Operations University Development Project To strengthen science & engineering in 28 leading Chinese 1981 Completed 1986 (Ln 2021-CHA, Cr. 1167-CHA) Universities. Objectives were to increase the quality & quantity of graduates & research, to strengthen the planning & management capabilities & to prepare investments in the education sector. Agriculture Education and To assist agriculture higher education and research in I1 1982 Completed 1989 Research Project agricultural colleges and 7 institutions. (Cr. 1297-CHA) Polytechnic/Television To increase the number of students & to improve the quality of 1983 Completed 1992 University Project instruction in China's 17 polytechnic institutions & 28 (Cr. 141 1-CHA) television universities. Rural Health Medical Education The educational component of this project was designed to 1984 Completed 1991 Project enhance the quality of education, training & curriculum. (Cr. 1472-CHA) Second Agricultural Education To improve & assist agriculture education in 23 agricultural 1984 Completed 1992 Project colleges, 12 agricultural technical schools. (Ln. 2444-CHA) Second University Development To increase technical & managerial personnel through policy & 1985 Completed 1992 Project institutional changes related to the engineering and (Cr. 1551l-CHA) economic/finance education subsector. Provincial University Project To provide direct assistance to 60 provincial universities in 28 1986 Completed 1992 Cr. 1671-CHA) provinces and planning assistance for the higher education subsector. Following Operations Textbook Development Project To support the textbooks upgrading program by the Chinese 1989 To be completed (Cr. 2006-CHA) Govemment. Objectives are to improve the educational quality 6/30/95 of textbooks at all levels of schooling, to increase the variety of available textbooks & to improve the efficiency of textbook production. Vocational & Technical To improve the quality of technical & vocational training in 1990 To be completed Education Project China through supporting 59 secondary vocational/technical 12/31/95 (Cr. 2114-CHA) schools in 10 provinces and 3 municipalities. Medium-Sized Cities To assists Changzhou, Luoyang and Shashi cities to improve 1991 To be completed Development Project overall and sector planning and management, including 6/30/97 (Ln. 3286-CHA) education. Key Studies Development Project To support the government's plan to reform the management of 1991 To be completed (Cr. 2210-CHA) science and technology programs. It consists of support for 6/30/96 research and graduate training in 133 State Key Laboratories and Special Labs affiliated with Universities and with the Chinese Academy of Sciences. Education Development In Poor To supports three main goals for the development of education 1992 To be completed Provinces in relatively poor provinces-Shanxi, Shaanxi, Hubei, Hunan, 12/31/98 (Cr. 2339-CHA) Guizhou and Yunnan. Effective Teaching Service To contribute to improved learning at the lower middle school 1993 To be completed Project level by providing teaching services, including instructional 12/31/98 (Cr. 2471-CHA) methodology, teacher training and management of teachers training and assignment. Basic Education In Poor And To support the attainment of universal primary education and 1994 To be completed Minority Areas Project expansion of coverage of lower secondary education in poor 12/31/2000 (Cr. 2651-CHA) and minority areas in 6 provinces: Xinjiang, Sichuan, Inner Mongolia, Ningxia, Guangxi, and Jiangxi. Third Basic Education Project To support the attainment of universal primary education and 1995 To be completed (Cr. 283 1-CHA) expansion of coverage of lower secondary education in poor 12/31/2001 and minority areas in 7 provinces: Anhui, Fujian, Gansu, Hebei Henan, Jilin and Qinghai Vocational Education Reform To improve and increase the supply of skilled labor, raise the 1996 To be completed Project quality and efficiency of the VTE system and build up capacity 12/31/2002 (Cr. 4063/Ln. 2898-CHA) for monitoring and evaluation in five high growth provinces and Tianjin municipality.  - 13 - TABLE 3: PROJECT TIMETABLE Date Actual/Latest Steps in Project Cycle Date Planned Estimate Identification (Executed Project Summary) 4/85 4/85 Preparation 3/86 3/86 Appraisal 6/86 9/18/86 Negotiations 3/87 3/23/87 Letter of development policy (if applicable) N/A N/A Board presentation 4/87 4/17/87 Signing 6/87 9/14/87 Effectiveness 8/87 1/19/88 First tranche release (if applicable) N/A N/A Mid-tern review (if applicable) 1990 3/26/90 Second (and third) tranche release (if applicable) N/A N/A Project completion 12/31/93 12/31/96 Loan closing 6/30/94 6/30/96 la /a Extended twice with one-year extensions each time. TABLE 4: LOAN/CREDIT DISBURSEMENT: CUMULATIVE ESTIMATE AND ACTUAL ($'000) FY88 FY89 FY90 FY91 FY92 FY93 FY94 Appraisal estimate 0.5 3.5 9.0 15.0 18.4 20.0 Actual 0.6 3.0 10.0 17.5 19.8 21.0 21.4La Actual as % of 120 86 111 116 107 105 estimate Date of Final 9/21/94 disbursement /a Higher cumulative disbursement in US dollar terms than estimated at appraisal was due to net cumulative depreciation of the US dollar against the SDR.  - 14 - TABLE 5: KEY INDICATORS FOR PROJECT IMPLEMENTATION Project Unit & Content Beginning Target Completion Five Teachers Colleges No. of in-college students (preservice) 3,291 5,800 8,005 No. of in-college students (inservice) 240 2,400 1,130 Graduates of preservice students 915 2,500 2,769 Graduate of inservice students 0 1,200 567 No. of permanent teachers 635 1,025 970 23 Normal Schools No. of in-school students 14,257 17,000 15,047 No. of graduated students 3,894 4,500 5,278 % of equipment purchased 0 100 130 400 Lower Secondary Schools No. of laboratories built 0 400 400 No. of science teachers trained 0 800 1,013 No of lab. technicians trained 0 400 837 % of equipment purchased 0 100 142 TV Education Institute No. of training centers open 101 1,600 1,644 Video tape courses production 2 10 10 Cumulative no. of primary teachers trained 0 36,000 36,467 Cumulative no. of secondary teachers trained 2,500 29,000 34,223 Cumulative no. of primary teachers got qualified 0 7,000 27,202 certification Cumulative no of secondary school teachers got 0 7,500 9,793 qualified certification Training Center of School Administration No. of students trained 89 400 401 No. of graduated students 43 200 195 No. of permanent teachers 19 50 51 Consultation Service Local consulting specialists (person/month) 0 300 350 Overseas consulting specialists (person/month) 0 6 8  - 15- TABLE 6: STUDIES INCLUDED IN PROJECT Purpose as Defined at Study Appraisal/Redefined Status Impact of Study Demand and Supply of Refine the research capacity Completed Research capacity increased Pritnary and Secondary of provincial teacher demand and plans for system decen- Teachers (1990-2000) and supply projections tralization accelerated Cost-Effectiveness Cost comparison of two Completed TV-based inservice proved to Evaluation of Inservice methods of teacher upgrading be a more cost-effective Training of Lower (TV-based and Institution- method of providing inservice Secondary Schools based Inservice Program) training Improvement of Science Study the improvements in Completed Student achievement in sci- Experiments in Lower 400 lower secondary schools ence experiments improved Secondary Schools as a result of the project TABLE 7A: PROJECT COSTS IN $ MILLION Appraisal Estimate Actual/Latest Estimate Item Province IDA Total Province IDA Total Land Acquisition 1.88 0.00 1.88 1.07 0.00 1.07 Civil Works 1.Teachers Colleges and Normal Schools Training Center 4.00 12.00 16.00 6.10 14.32 20.42 2. 400 Lower Secondary Schools 8.84 0.00 8.84 5.00 8.00 5.00 Furniture 1.46 0.00 1.46 1.40 0.00 1.40 Equipment and Teaching Materials 0.00 7.80 7.80 0.00 6.92 6.92 Local Experts 0.07 0.00 0.07 0.00 0.00 0.00 Local Training 0.46 0.00 0.46 0.27 0.00 0.27 Foreign Experts 0.00 0.08 0.08 0.00 0.13 0.13 Training Abroad 0.00 0.12 0.12 0.00 0.09 0.09 Total Project Costs 16.71 20.00 36.71 13.84 21.46 35.30 TABLE 7B: PROJECT COSTS IN Y MILLION Appraisal Estimate Actual/Latest Estimate Item Province IDA Total Province IDA Total Land Acquisition 6.96 0.00 6.96 4.94 0.00 4.94 Civil Works I.Teachers Colleges and Normal Schools Training Center 14.80 44.40 59.20 28.09 67.61 95.70 2. 400 Lower Secondary Schools 32.70 0.00 32.70 23.00 0.00 23.00 Furniture 5.40 0.00 5.40 6.43 0.00 6.43 Equipment and Teaching Materials 0.00 28.86 28.86 0.00 30.91 30.91 Local Experts 0.26 0.00 0.26 0.00 0.00 0.00 Local Training 1.70 0.00 1.70 1.27 0.00 1.27 Foreign Experts 0.00 0.30 0.30 0.00 0.65 0.65 Training Abroad 0.00 0.44 0.44 0.00 0.51 0.51 Total Project Costs 61.82 74.00 135.82 63.73 99.68 163.41  - 16- TABLE 8: KEY INDICATORS FOR PROJECT OPERATIONS Not applicable. TABLE 9: ECONOMIC COSTS AND BENEFITS Not applicable. TABLE 10: STATUS OF LEGAL COVENANTS Agreement Section Covenant Present Original Revised Description of Covenant Comments Type Status Fulfillment Fulfillment Date Date Credit 2.02(b) I C Open and maintain a Special Account Schedule 3, 5 C Use and selection of Section II, consultants to be based I and 2 on "Guidelines for the Use of Consultants by World Bank Borrowers and by the World Bank as Executing Agency, August 1981" Project 2.02(a) 5 C Open and maintain project implementation office 2.07(a) 9 C Submit each year by January I progress report on the policy action program 2.08(b) 10 C Conduct a mid-term review by June 30, 1990 3.01 1 C Submission of audit project accounts and auditor's report to IDA no later than June 30  - 17- TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL STATEMENTS Not applicable. TABLE 12: BANK RESOURCES: STAFF INPUTS (ALL COMPONENTS) Stage of Project Cycle Planned Revised Actual Weeks $ Weeks $ Weeks $ Through appraisal not available not available not available Appraisal-Board not available Board-effectiveness not available Supervision Completion 14.00 34.60 Total 524.60 1,412.20 TABLE 13: BANK RESOURCES: MISSIONS Stage of Project Cycle Month/Year Number of Days in Specialized Staff Performance Types of Problems Persons Field Skills Represented Rating Through appraisal 6/86-10/86 6 17 Gen. Edu., Econ., No major problems Technical Edu. Appraisal through Board 11/86-3/87 3 No major problems approval Board approval through 4/87-8/87 No major problems effectiveness Supervision 11/87 2 5 Sen. Edu., Tech. Edu. I No major problems 7/88 2 4 Sen. Edu., Tech. Edu I No major problems 3/89 3 9 Sen. Edu., Sen. Edu., I No major problems Financial Analyst 4/90 3 10 Sen. Edu., Sen. Edu., 2 Mid-term Review. Financial Analyst Shortages in coun- terpart funds were identified as prob- lem 10/90 2 4 Sen., Eco., Edu. I No major problems 5/92 2 5 Eco., Sen. Eco. 1 No major problems 5/93 4 5 Eco., Sen. Eco., Edu. I No major problems Mgmt., Spec., Adm. Sect. 9/94 2 3 Operations Analyst, Satisfactory ICR mission Sen. Eco.   -19 - ANNEX A ANNEX A: MISSION AIDE MEMOIRE 1. A World Bank mission comprising Ms. Sandra Erb (mission leader) and Mr. Leon Miller (consultant) visited Gansu Province during the period September 21-23, 1994 to review the status of and make preparations for the Implementation Completion Report (ICR) of the education component of the above project. Excellent arrangements and preparations for the mission were made by the Gansu Project Implementation Office (GPIO) and the Education Project Implementation Office (EPIO). Aside from meetings with GPIO and EPIO in Lanzhou the mission traveled to the Qincheng District, Tianshui City to observe the project implementation at the Tianshui Normal College. The mission would like to express its sincere thanks for the cooperation and hospitality it received from the local authorities during its visit to Gansu. The following summarizes the findings of the mission. Unless indicated in a follow-up letter from Bank management, these agreements recorded in the Aide-Memoire are final with the signature of the task manager. 2. Overall Implementation Status. The mission was pleased to learn that, except for four civil works projects, the implementation of the education component of the project was completed by the original closing date of June 30, 1994. As of the new closing date of June 30, 1995, the total credit amount, SDR 15.83 million, is expected to be fully disbursed. Indicators to monitor progress under the Action Plan have been met or exceeded by the project with, the exception of inservice training goals. 3. Civil Works. All civil works construction was expected to be completed by the end of 1993. However, with the very high increases in building material costs in 1993, some construction activities were stopped. Considerable time was lost in resolving the issue of the increased material costs with the contractors. Agreements were subsequently reached with the contractors to enable them to proceed with the construction activities in 1994. Now all civil works activities have progressed and will be completed by the end of 1994. Four contracts at Normal Colleges were effected by these delays. A total of about 2 265,000 m or 94 percent of the original target in the SAR have been constructed under the project. The 400 lower secondary schools laboratories, amounting to about 92,000 mn2 or 100 percent of the original target was completed in 1991 with the use of local funds. The construction for the other project institutions, which will be completed in 1994, will total 173,000 m2.' l The original planned construction for the project institutions of 192,000 m2 was revised downward to 172,000 m2 in 1992. This reduction occurred as a result of significant cost increases in building materials and labor.  -20 - ANNEX A 4. The quality of construction at the not mal college visited is very good. However, when the mission visited the first building constructed at the Tianshui Normal College in 1988, the classroom building, it was already showing signs of wear. The mission therefore, would urge PEdC to pay particular attention to the maintenance of the facilities constructed under the project. PEdC should start a maintenance program for civil works as quickly as possible to protect the investments made during the project. 5. Equipment. All of the equipment has been procured under the project and is in operation. As mentioned above, considerable attention should be given to providing adequate financial resources for maintenance, consumables and replacement equipment that may be lost as are result of normal operation. Otherwise the effectiveness of the equipment will deteriorate rapidly and the equipment could become a total loss in as short a period as 3-4 years. The mission encourages the provincial authorities to systematically provide adequate funding for the maintenance for school equipment. 6. Technical Assistance and Training. In May 1993 there was approximately $60,000 remaining in the Technical Assistance disbursement category. The May mission recommended several possibilities for using the funds on technical assistance activities. The present mission was pleased to learn that the Gansu Provincial Education Bureau had organized several training activities with the remaining funds. The Province used $50,000 to: (a) invite two experts from Hong Kong to give a seminar on education planning and management for lower secondary school principals; (b) hold seminars for middle school and vocational school principals; (c) organize a seminar for primary and lower secondary school teachers on the new teaching program under the nine-year compulsory education system; (d) send principals to Shanghai and Shandong to learn new techniques in education management; (e) hold a seminar on vocational education; (f) hold a seminar for provincial education managers and; (g) commission the Provincial Education Research Institute to evaluate and analyze the affect of the new laboratory equipment in the 400 lower secondary schools on the achievement levels of students. (See Annex 1 for report.) 7. Based on the information provided in the report on TA activities, the mission recommends that the 60 principals who participated in the planning and management seminar, in which new methodologies and techniques were taught, be used as a core group to provide advice in developing future training activities for principals. In addition, the mission recommends that the results of the study conducted by the Provincial Education Research Institute be used to develop a long-range provincial plan to provide training and lab equipment to the remaining 600 nonproject-supported lower- secondary schools in Gansu Province. The mission feels that the report could be used as a basis for approaching the Provincial Finance Bureau for the necessary funds to carry out the implementation of such a program. 8. Inservice Teacher Training. By the end of the project, the total enrollment in inservice teacher training in the Normal Colleges was 1,130 or 45 percent of the target. On the other hand, all the indicators for TV and correspondence inservice training exceed targets by as much as 131 percent. Gansu officials repeated the explanation given in May  -21- ANNEX A 1993 for the difference in the project target indicators which was: (a) the fact that the State Education Commission instituted a policy of improving the overall quality of the teaching force in the country by extending the two-year preservice training programs for lower secondary schools to three years at the junior normal colleges, thereby reducing the potential for increasing enrollment and (b) the fact that alternative inservice teachers training programs, i.e., TV and correspondence courses, were expanded significantly during this time as a alternative to on-campus inservice training. 9. Despite the fact that there were significant increases in TV inservice instruction, the mission is concerned with the quality of these types of training programs, particularly in the remote areas. In an effort to maintain quality in these expanded training programs, the mission recommends that officials consider brief periods of withdrawal training or school-based training to enhance the distance and correspondence courses. The Province could consider establishing special coaching centers or mobile teams of teachers to provide this enhanced service. 10. The mission encourages Gansu to bear in mind that the training of professional and administrative staff is a continuous process and that institutions should have their own staff development plans, which should be continually updated. 11. Transition from PCR to ICR Preparation. PCR preparation was discussed during the May 1993 mission. It was agreed during the May mission that the Borrower's section would be completed by September 30, 1994. This was presented to the current mission and is attached (Annex 2) as Part II of the PCR from the Gansu Provincial Education Bureau. The mission wishes to compliment the provincial authorities for producing a detailed, useful and timely report which, when presented in its final form, will be incorporated in the project's final Implementation Completion Report (ICR). 12. The mission reviewed Part II with the Borrower requesting that changes or modifications be made in both the report and the accompanying statistical table to strengthen the final document. It was agreed that the final copy of Part II would be submitted to the Bank by March 31, 1995. The mission also discussed the new Bank procedures for ICR preparation with the EPIO. The mission explained that the Borrower is now required to prepare an Operation Plan for submission to the Bank along with Part II. Since the ICR procedures are new to the Borrower, the mission provided the EPIO with an outline of topics that the Borrower should consider when preparing their Operation Plan. It was agreed that the Borrower would prepare and submit a draft Operation Plan to the Bank by December 15, 1994 for review and comment back to Gansu by January 1995. It was agreed that the final ICR would be prepared by the Borrower and the Bank by March 31, 1995. Halsey L. Beemer, Jr. Task Manager, EA2HR October 19, 1994 (Original including annexes may be found in the Project Files.)  - 22 - ANNEXB ANNEX B: BORROWER'S CONTRIBUTION TO THE ICR I. Project Summary 1.1 For the purpose of supporting Gansu Provincial Government's efforts in universalizing nine year compulsory education, World Bank decided in 1985 to carry out a basic education project in Gansu as a component of Gansu Provincial Development Project. The aim of the education component was to extend the training capacity for teachers of basic education so as to upgrade the level of basic education in Gansu Province. After two years of thorough discussion and careful preparation, the project began to be implemented in January, 1988. This project was the first basic education project that has been carried out in Gansu and even in China by World Bank Credit Loan. There are two most prominent characteristics in this project. One is that great efforts were made to promote the development of teachers' education in order to solve the quantity and quality problems of teachers for nine year compulsory education. The other is that the project put striking emphasis on supporting the development of nine year compulsory education in poor areas so as to provide equal education opportunity for the disadvantaged population group in rural areas. The two key points showed that specialists of Gansu educational circles and educational experts from World Bank arrived at the unified recognition on the strategic approach for the development of education cause in Gansu Province. 1.2 Main Contents of the Project (a) Extending the training capacity of five teachers' colleges from 3,500 to 8,200 so as to increase the number of teachers' for lower secondary schools; (b) Providing modem electronic teaching equipment for 23 normal schools in order to upgrade the training quality of primary school teachers; (c) Having an Educational Administration Training Center established in Gansu Education Institute with the training capacity of 400 personnel to train educational administrative staff and improve the quality of educational administration; (d) Establishing 430 TV education centers all over the Province to extend the training scale of in-service teachers and reduce the number of unqualified teachers;  - 23 - ANNEXB (e) Providing 400 lower secondary schools in 46 poor counties with science teaching aids to improve the conditions of science subject experiments in lower secondary schools; (f) Inviting foreign educational specialists invited to give technical assistance and consultation; organizing study groups to conduct study tours abroad so as to improve the levels of educational administration and policy decision. 1.3 International Development Association (IDA) provided a credit loan of SDR 15.83 million which is equivalent to US$20 million for the project. Gansu Provincial Government invested local funds of RMB 62 million yuan (including RMB 23 million yuan of construction funds invested in 400 lower secondary schools) . The total investment was RMB 136 million yuan (US$1 = RMB 3.7 yuan). 1.4 The project credit loan was mainly used for construction of new school buildings, procurement of educational equipment and furniture and related personnel training. The implementation period was 7 years and the project would be closed on December 31, 1994. 1.5 After 2 years of preparation and 7 years of implementation, the Project has come into the closing time. The Project has completed the total investment of RMB 163.41 million yuan, of which the credit loan from World Bank were RMB 99.68 million yuan (equal to SDR 15.81 million or US$21.46 million). The construction are of new school buildings were 173,300 m' with total investment of RMB 100.64 million yuan. The investment for equipment procurement were RMB 30.91 million yuan and the spending on furniture and others were RMB 6.43 million yuan. The spending for training were RMB 2.44 million yuan. The building constructed in 400 lower secondary schools were calculated as RMB 23 million yuan (Table I) . 1.6 All the project objectives and monitoring indicators have been fulfilled or over- fulfilled (Table V and VI). At present, the beneficial results of the project have been achieved obviously. The project is now playing an important role in promoting the development of basically universalizing nine year compulsory education in Gansu. II. Project Implementation and Management Project Preparation 2.1 In April 1985, after inspection on the social and economic development in Gansu Province, World Bank pointed out that besides solving the problems of economic development, it would be more important to improving the personnel training and education, particularly the personnel for basic education. In the document "The Growth and Development in Gansu Province," compiled by World Bank, it was pointed out that the employment and transition of labor force, the application of new agricultural technology, the increase of agricultural production and the improvement of women's social status are also depended on the good basic education. In the poor areas of a  - 24 - ANNEX B developing country where the overall level of education is low, the economic beneficial result of investment in basic education would be much higher than investment in other areas (P. 51 of the Document). Based on this recognition, The World Bank delegation put forward a proposal of basic education project which was different from other World Bank project implemented in China before. Gansu Provincial Government reacted immediately to support this suggestion and demanded the related departments to cooperate with World Bank for the project establishment and preparation. 2.2 The project approval and preparation are very important. It is not only connected with the correct areas of investment, but also crucial to whether the designed project could get satisfactory results after the project implementation. Therefor, a perfect project design means half the success of a project. 2.3 Entering the 1980s, the development of basic education in Gansu came across some serious challenges. Poor Schooling conditions and lack of qualified teachers consisted of the main problem that restrained the development of education. Therefore, priority should be given to solve these problems. On one hand, however, it was unrealistic to solve these two problems with the limited credit loan only. On the other hand, if the credit loan was distributed equally to a large scale of education areas, it would be not effective and cause new investment waste, just like "throwing a stone into the sea". So, the important principle for the project preparation must be centralizing the funds to determine the key project points and meet the most urgent necessity. Through serious analyzing, specialists from both side (the lender and the borrower) got the same recognition unanimously that the most urgent task was to enhance teachers, training for basic education. Without good training of teachers, the school could not educate good students with fine schooling conditions. Good teachers, however, can teach students well even in hard situations, for they can make up for the difficult conditions through many ways. Based on this recognition, both the Lender and the Borrower agreed to use the credit loan on the development of teachers' education. This design has been proved correct by the project implementation. After nearly ten years of hard work on the project, the teachers' education bases have been established for the universalization of nine year compulsory education in Gansu Province. 2.4 Besides stressing on the prominent points, the project design also made careful consideration about the technical details of implementation, such as the supplementary of school buildings, equipment procurement, personnel training and estimated expenditure. A practical project implementation plan was made to ensure that there would be no shortage of funds and no deduction of project indicators. With the participation of experts from World Bank and the guidance of provincial government, the project units at all levels spent more than a year in making the estimated expenditures on all parts of the project. Enough contingent funds were prepared according to the suggestion of World Bank experts. After the testing of nine years, implementation, all the project targets and monitoring indicators stipulated in project proposal have been completed without any deduction, though the project experienced twice serious inflation in 1988 and 1993. From this experience, we realized that all the project indicators must be designed properly  -25 - ANNEX B with certain flexible margin, especially for the project of long term. The project preparation time would rather be longer. It seems time consuming, but it can guarantee the smooth development of project implementation. 2.5 Experts from the World Bank played an important role in the project preparation. During the two years of preparation, six World Bank delegations came to Gansu to provide technical guidance on project selection, monitoring indicators determination, the ways of procurement and the financial expenditures. Their involvement greatly helped the project units to understand the project characteristics, principles, procedures and methods. The participation of World Bank Experts is an essential condition for the successful project implementation, particularly at the preparation stage. Project Implementation 2.6 The project were divided into three parts, i.e., civil works, equipment procurement and personnel training. The key point was civil works which took a large amount of credit loan. It was more difficult f than equipment procurement and personnel training because it had complicated procedures, long period of construction, strong policy limits, more unexpected situations and large investment with many management units involvement. It was the major aspect which affects the results of the project. It is also the main indicator for the evaluation of the project. A. Civil Works 2.7 According to the project plan, civil works were arranged at 5 teachers, colleges, 4 normal schools and Gansu Education Institute, In accordance with the national standards of construction area for per student issued by the State Education Commission, enough construction areas and sufficient credit funds were allocated for all these colleges and schools according to their schooling scale. Approved by Gansu Provincial Government, 22 the new schooling construction area was 171,900 m . (It was 190,300 m2 in the proposal report) with a total investment of RMB 55,760,000 yuan. By the end of the Project, the construction area completed is 173,300 mr with a total investment of RMB 100,640,000 yuan (of which the World Bank credit was RMB 67,610,000). Compared with the original plan, the construction area did not go beyond the plan but there was a big overspent of investment funds. The main causes for investment overspent are the followings: (1) 30% of contingence cost and land acquisition cost were not included in the original plan. (2) Due to the long period of implementation, the cost on construction materials was greatly affected by inflation. The overspent, however, has been solved through appreciation of credit and reallocation of funds from equipment procurement. As a result, there is no deduction in construction areas of civil works. 2.8 The main obstacles in civil works (a) The new market economic system is still to be perfected in China. The construction enterprises and traders were not well adaptable to the World  - 26 - ANNEX B Bank regulations on bidding and the contract management. As a result the progress of civil works was delayed because of contract disputes. (b) The long construction period of civil works caused overspending. (c) The unqualified expenditures during the process of disbursements often led to delay in payment. B. Equipment Procurement 2.9 According to SAR, 24,270, 000 yuan were allocated for equipment procurement, and 4,520,000 for furniture. By the end of the project, the equipment procurement was completed for 30,910,000 (100% WB Loan payment) and 6,430,000 was for furniture and others (paid by local funds) (Table III). 2.10 The procurement of teaching equipment was carried out according to the agreement with World Bank through one international competitive bidding and three local competitive bidding. For Gansu educational institutions, it was the first time to use international practice of competitive bidding in procurement of teaching equipment. The competitive bids have many advantages in procurement, such as reasonable price, good quality, less management cost and diminishing of unfair trade. It is an effective way of equipment procurement. 2.11 Due to the differences of this project from other WB projects in China, there are some deficient points existed in equipment procurement. Some competitive bids did not achieve obvious beneficial results because various types of schools needed different equipment and could not form a large quantity, which affects the efficiency of bidding. C. Technical Assistance and Personnel Training 2.12 As an inalienable component of any World Bank Project, technical assistance and personnel training is a prominent indicator which makes it differ from other projects. In this project, 2,340,000 yuan were allocated for personnel training and technical consultation, of which US$200,000 was from World Bank Loan. The major activities are: (a) Foreign specialists were invited to come to Gansu and give lectures; (b) Groups of study tours were sent abroad to study educational development in foreign countries; (c) Local training workshops were conducted. 2.13 Under the supervision and direction of World Bank, clear and detailed training plans were made as the priority of the project implementation. Up to now, all the training work was carried out smoothly according to the plan. Six American educational experts were invited to provide technical consultation in the fields of education supervision,  -27 - ANNEX B management of data and statistics, educational management and distance learning. Three study tours were arranged to America and Germany to study on distance learning, teachers' education and vocational education. The funds remained were used to invite two specialist from Hong Kong Chinese University, who gave lectures on educational management. The total WB Loan spent is US$220,000. 2.14 Using local funds, three training workshops for teachers and laboratory technicians from 400 project lower secondary schools were conducted and another three workshops were also carried out for operation of experiment equipment in normal schools. Long-term and short-term training workshops were arranged for teachers of different subjects and managers of different specialty by project units. The total funds were 1,280,000 yuan (Table IV), which has historic significance in project units. The strengthening of technical assistance and personnel training played an active role in upgrading the personnel quality and management level in project units. It is also an important aspect to let the credit loan achieve long-term benefits. 2.15 Obstacles in technical assistance and personnel training; (a) Due to the difference in the knowledge level between foreign experts and the practical demands of project units, there was some difficulties for trainees in accepting the information from foreign experts. (b) Some individual project units put emphasis on short-term training and were reluctant to conduct long-term training, therefore, the quality of training was influenced, Project Management 2.16 Scientific and strict management is the basic guarantee for the smooth project implementation. As the first educational project conducted by Gansu Provincial Government independently, great emphasis was attached on the project implementation. From the beginning to the end, the provincial government and individual project units have been working hard to fulfill their obligations and duties according to the Project Proposal and the Credit Agreement. Through years of practice, the following points have been summarized for the project management. (a) Specialized organizations have been established from upper level to grassroots units. These organizations with steady personnel have the characteristics of relatively independent, unification of authority and responsibility, connections among project units and cooperation between each other. (b) Training workshops for project personnel were conducted before and during the project implementation. The emphasis was put on some prominent aspects, such as procurement and payment.  -28 - ANNEX B (c) The project implementation strictly followed the rules and regulations of World Bank and Chinese Government. It was not allowed to make impulse changes in the project scope, investment direction and procurement methods. (d) The local project funds were arranged as the first priority, even though the provincial finance was quite limited. (e) Serious and strict examinations were conducted for equipment procurement list and construction standards to prevent overspent. (f) Having worried seriously at the bids for civil works and equipment procurement. (g) Strengthening the contract management to reduce phenomena of payment beyond the contract. (h) Working effectively on the audit and reimbursement and of procurement to prevent unqualified payment on the one hand and accelerate the speed of reimbursement; (i) Making annual project summary report; (j) Working efficiently and cooperatively with World Bank mission to solve the obstacles in the project implementation. Research on Improvement of Science Subject Experiment in 400 Lower Secondary Schools 2.17 Entrusted by the World Bank delegation, Gansu Institute for Educational Research (GIER) undertook the investigation on improvement of Science Subject Experiment in 400 lower Secondary Schools to make a practical evaluation on the beneficial result of the teaching aids distribution and supervise the effective application and management of teaching equipment. A research group was formed and spend five years (89-94) to conduct this research. The research was divided into four stages (Overall investigation, test before teaching aids distribution, Post Distribution test and Summarizing Evaluation). Various methods were used for the research, such as on-the- spot investigation, forum talk, questionnaires and tests. The research results showed that the following objectives have been achieved: (a) The schooling conditions for science subjects teaching have been greatly improved in project schools; (b) The student achievements in learning have been raised obviously. (c) The teachers, initiative has been stimulated.  -29 - ANNEX B (Details in "Evaluation Report on the Improvement of Science Subject Experiment in Lower Secondary Schools" by GIER). The result of this research will make schools and educational administration department at different levels fully recognize the important role of teaching equipment so as to pay attention to the allocation and application of teaching equipment. Moreover, the significance of this research has go beyond itself. It shows that the educational research in our province has made new progress in serving the countryside, serving schools, serving practice. III. Beneficial Results of the Project The Progress of Nine Year Compulsory Education Has Been Enhanced 3.1 By 1993, 54 counties achieved universalization of primary education and 14 counties universalized lower secondary education, but the figures were 33 and 0 respectively in 1986 before the implementation of the Project. The enrollment rate of school-age children in 16 poorest counties has been greatly raised. The area of dangerous school buildings in secondary and primary schools has been reduced from 1,650,000 m2 2 to 448,000 m2. The shortage of schooling furniture has been reduced from 740,000 sets to 100,000 sets. The Qualification Standards of Teachers Has Been Raised 3.2 Five teachers in colleges have reached their training scale more than ten years ahead of time. They can meet the training demands for lower secondary teachers, training for the next ten years or more. The improvement of schooling conditions in 23 project normal schools and the extended ways for teachers, inservice training has greatly bettered the standards and levels of teachers' quality in basic education. Speaking of quantity, the monitoring figures showed a great change in the ratio between teachers and students. The number of students for per teacher in lower secondary and primary schools has been lowered respectively from 21.4 and 22.4 before the project to 14.7 and 19.6 now. It is lower than the standards regulated by the State Education Commission. To a certain degree, there is no insufficiency for demands of teachers now. Speaking of quality, the monitoring indicators showed that the rate of qualified teachers has been raised greatly. The rates of academically qualified teachers in lower secondary schools and primary schools have been raised from 22.8% and 67.6% before the Project to 54.1% and 81.8% respectively. The project implementation not only eased the shortage situation in the past ten years, but also created a sound state to meet the demands for qualified teachers in the future. Science Experiment in 400 Lower Secondary Schools Has Been Improved 3.3 The project provided 400 lower secondary schools in poor districts with whole sets of teaching aids for chemistry, physics and biology, which made all project schools possess the ability to conduct all the experiment demonstration and students experiments in groups. As a result, it improved the teaching of science experiment, stimulated the students, interests in learning science subjects and trained their ability to do experiment  - 30 - ANNEXB by themselves, which upgrades the education quality. Moreover, the distribution of teaching aids enlightened the initiative of local governments in education. Funds for the construction of laboratories and the making of instruments cabinets were collected by local governments before the distribution of teaching aids. Training for teachers and lab technicians were organized at provincial level. The completion of the project is the result of joint efforts made cooperatively by World Bank, Gansu provincial government and local governments. It is a good model for similar projects in the future. Project Management Level Has Been Improved 3.4 During nearly ten years of practice in project implementation, project management departments and project units have learned and mastered the scientific ways of strict management in World Bank projects, such as project establishment, proposal, competitive bidding, contract management, financial disbursement and objective monitoring. This provided helpful experience for raising the management level of educational departments and for disseminating the methods of project management. IV. Project Evaluation A. Experience Striking Key Points and Rational Design 4.1 During the project establishment, both side (the lender and the borrower) realized the priority and imminent necessity for the development of basic education in poor areas. Correct decision was made that the credit loan for education would be used for the development of basic education. 4.2 Teachers' education and training were selected from all the aspects of basic education as the major targets of the project. This represented the principles of World Bank Loan, which is centralizing the investment to solve the prominent problems and achieve the beneficial results so as to avoid the shortcomings of diversified investment. 4.3 After nearly two years of repeated discussion and consultation about the Project Proposal, the most desirable plans were selected for school buildings' locations and equipment distribution. Careful consideration was also taken into account about unpredictable situations which might take place during the project implementation. Sufficient contingent funds were prepared. Although the project implementation took a long period of time and was affected by serious inflation, all the projects have been successfully completed as planned and no deduction occurred in project items because of insufficient funds. The Importance of World Bank Staffs' Participation 4.4 Throughout the project, experts from World Bank have been involving in the project management and playing an important role in project implementation. From the  -31- ANNEX B beginning to the end, 13 World Bank missions made up of specialists on education, civil works, equipment procurement and financial disbursement were sent to Gansu to conduct supervising consultation and provide technical assistance on their own cost. Their rich knowledge, ardent working attitude, scientific approach and practical style are very impressive. Most of their suggestions were practical, constructive and suitable to the reality of project units. we sincerely hope that the cooperative ties between World Bank and the Borrower would be strengthened to further upgrade the efficiency of credit management. Obvious Effect of Project Management 4.5 Through 50 years of practice in various projects implementation, World Bank has accumulated a systematic experience in project procedures, methods and principles, especially about the design of project: proposals, competitive bidding, contract management, financial disbursement and target monitoring. The practice in Gansu Project proved again that these management procedures are scientific and efficient. Gansu Province will sum up the theory and methods of project management and use them in forming rules of project management, which would be disseminated in future projects. Prominent Effect: of Project Supervision by Financial Department 4.6 The smooth development of project establishment, proposal and implementation were closely connected with the involvement and supervision of provincial comprehensive departments, especially Provincial Finance Department. (a) Provincial Planning Commission and Finance Department involved actively in the Project Proposal at the project establishing stage. They enhanced the project establishment by determining the investment scope and scale, the commitment and collection of local project funds. (b) During the project implementation, Provincial Finance Department executed strictly according to the financial regulations of World Bank to supervise the proper use of credit and allocate project funds on time. This ensured the smooth implementation of the project. (c) Although the provincial finance was in a difficult situation, local funds were collected and allocated for project turnover, which accelerated the project progress. (d) Special attention and priority were put on the credit funds for personnel training. It had an distinguished position in the project. (e) Many training workshops on World Bank finance payment and project management were conducted to upgrade the professional level of project management personnel.  - 32 - ANNEX B B. Lessons learned More Funds Should Be Allocated for Civil Works 4.7 The major aspect for developing basic educational conditions in poor areas is the construction of schools buildings. Investment ratio of civil works should be increased respectively according to the lowering of school levels, that is, the lower level of the school is, the higher ratio of investment for civil works should be allocated. In the Project Proposal, however, the credit ratio for civil works confirmed by World Bank was somewhat lower (60%) while the ratio for equipment procurement was higher (39%). As a result, big readjustment had to be made during the project implementation. Nearly US$1,000,000 from equipment were reallocated into civil works, which affected the progress of project implementation. We would like to suggest that the investment ratio for civil works should be increased in future World Bank educational projects, especially in the project for basic education in poor areas. Technical Consultation Should Mainly Rely on Local Specialists 4.8 In every World Bank project, it is regulated that certain number of foreign experts should be arranged to conduct technical consultation. This regulation plays a positive role in raising project-management-level and standards of the Borrower. However, the actual reality of project units should be taken into account so as to raise the beneficial results of the credit support. As a poor province in Northwest China, Gansu has a wide gap in education level, compared with that of advanced foreign countries. It is difficult for trainees to digest what the foreign experts lectured, besides the high cost on foreign experts. Our suggestion is that the ratio of local specialists consultation should be increased during the project implementation in poor areas. While inviting foreign experts, attention should be paid to select them form the countries which leave the similar conditions in educational development with the project areas. In this way, the active role of foreign experts can be put in full play and the beneficial results of consultation can be highly raised.  - 33 - ANNEX B Table 1. Completion Status of Project Investment (unit: Y million, $ million) Items Appraisal Report Actual Completion Local WB Total Local WB Total Land Acquisition 6.96 0 6.96 4.94 0 4.94 (1.88) (0) (1.88) (1.07) (0) (1.07) Civil Works 1. Teachers Colleges and 14.80 44.40 59.20 28.09 67.61 95.70 Normal Schools Training Center (4.00) (12.00) (16.0) (6.10) (14.32) (20.42) 2. 400 Lower Secondary 32.70 0 32.70 23.00 0 23.00 Schools (8.84) (0) (8.84) (5.00) (0) (5.00) Furniture 5.40 0 5.40 6.43 0 6.43 (1.46) (0) (1.46) (1.40) (0) (1.40) Equipment and teaching 0 28.86 28.86 0 30.91 30.91 materials (0) (7.80) (7.80) (0) (6.92) (6.92) Local Experts 0.26 0 0.26 (0.07) (0) (0.07) Local Training 1.70 0 1.70 1.27 0 1.27 (0.46) (0) (0.46) (0.27) (0) (0.27) Foreign Experts 0 0.30 0.30 0 0.65 0.65 (0) (0.08) (0.08) (0) (0.13) (0.13) Training Abroad 0 0.44 0.44 0 0.51 0.51 (0) (0.12) (0.12) (0) (0.09) (0.09) Total 61.82 74.00 135.82 63.73 99.68 163.41 (16.71) (20.00) (36.71) (13.84) (21.46) (35.30) Note: The figures in blanks are  - 34 - ANNEX B Table II. Completion Status of Civil Works (unit: m ; Y'000) Project Unit Appraisal Report Actual Completion Area Investment Area Investment World Bank Total 282,278 78,760 265,349 123,639 67,609 5 Teachers' Colleges 152,251 44,540 136,954 85,549 56,826 Lanzhou 22,300 5,900 19,286 11,416 8,095 Qingyang 29,000 7,540 23,328 12,386 9,017 Tianshui 42,610 13,800 43,303 27,365 17,297 Zhangye 32,120 8,480 26,149 18,432 11,999 Hezuo 26,211 8,820 24,888 15,950 10,418 4 Normal Schools 24,027 6,320 22,815 9,775 7,238 Lanzhou 1,200 420 1,293 1,919 1,509 Qingyang 5,760 1,440 5,870 1,931 1,434 Tianshui 8,567 2,370 7,495 2,910 2,194 Zhangye 8,500 2,090 8,157 3,015 2,101 Training Center 14,000 4,900 13,580 5,315 3,545 Subtotal 190,278 55,760 173,349 100,639 67,609 400 Lower Secondary 92,000 23,000 92,000 23,000 Schools  - 35 - ANNEX B Table III. Implementation Status of Equipment and Furniture (unit: Y'000) Project Unit Appraisal Report Actual Completion Sub. Equip. Furniture Sub. Equip. Furniture Others Total 28,788 24,268 4,520 37,340 30,911 3,954 2,475 Teachers' Colleges 10,625 8,002 2,650 14,092 9,866 3,435 791 Lanzhou 1,550 1,150 400 2,289 1,524 520 245 Qingyang 1,838 1,358 480 2,527 1,790 662 75 Tianshui 3,218 2,32, 890 3,785 2,379 1,122 284 Zhangye 2,214 1,754 460 2,954 2,341 593 20 Hezuo 1,832 1,412 420 2,537 1,832 538 167 Training Center 1,692 1,392 300 2,267 1,762 384 121 Normal Schools 2,950 2,950 3,866 3,866 Lower Secondary 6,001 4,531 1,470 6,703 6,703 Schools TV Ed. Institute 7,493 7,393 100 8,587 8,375 135 77 GPIO 1,545 339 1,206 Cost on Research and 280 280 others  - 36 - ANNEXB Table IV: Completion Status of Technical Assistance and Personnel Training (unit: Y) Project Unit Appraisal Report Cost Actual Completion Cost Total 2,340,000 2,437,485 Local Training 1,530,000 1,279,330 Teachers' Colleges 820,000 634,000 Normal Schools 100,000 60,000 Lower Secondary Schools 400,000 338,000 Training Center 100,000 122,500 TV Education Institute 100,000 100,000 Project Management 10,000 24,830 Training Abroad 440,000 508,155 Local Consultation 70,000 TV Education Institute 30,000 Training Center 40,000 Foreign Consultation 300,000 650,000 Note: Cost on local consultation is included in local training.  - 37 - ANNEX B Table V. Completion Status of Project Monitoring Indicators Project Unit & Content Beginning Target Completion Five Teachers Colleges No. of in-college students (preservice) 3,291 5,800 8,005 No. of in-college students (inservice) 240 2,400 1,130 Graduates of preservice students 915 2,500 2,769 Graduate of inservice students 0 1,200 567 No. of permanent teachers 635 1,025 970 23 Normal Schools No. of in-school students 14,257 17,000 15,047 No. of graduated students 3,894 4,500 5,278 % of equipment purchased 0 100 130 400 Lower Secondary Schools No. of laboratories built 0 400 400 No. of science teachers trained 0 800 1,013 No of lab. technicians trained 0 400 837 % of equipment purchased 0 100 142 TV Education Institute No. of training centers open 101 1,600 1,644 Video tape courses production 2 10 10 Cumulative no. of primary teachers trained 0 36,000 36,467 Cumulative no. of secondary teachers trained 2,500 29,000 34,223 Cumulative no. of primary teachers got qualified 0 7,000 27,202 certification Cumulative no of secondary school teachers got 0 7,500 9,793 qualified certification Training Center of School Administration No. of students trained 89 400 401 No. of graduated students 43 200 195 No. of permanent teachers 19 50 51 Consultation Service Local consulting specialists (person/month) 0 300 350 Overseas consulting specialists (person/month) 0 6 8  - 38 - ANNEX B Table VI. Completion Status of Action Plan Monitoring Indicators in 1993 Items Beginning Target Completion 1. No. of counties popularized primary 33 50 54 education 2. No. of counties universalized nine year 0 8 14 compulsory education 3. Average rate of school enrollment rate in 16 65 75 92.2 poorest counties 4. Percentage of girls students in primary 40 43 44.1 schools 5. Percentage of girls students in lower 33 35 40.5 secondary schools 6. Gap of supply and demand for primary 0 0 -2,579 schools teachers (persons) 7. Gap of supply and demand for lower 7,606 2,000 -3,965 secondary school teachers (persons) 8. Percentage of village or minban teachers 56 45 42.5 9. Monthly income of village or minban 40-50 44-50 43-48 teachers (Yuan/month) 10. Area of dangerous school buildings (10,000 165 90 44.8 m2) 11. Gap of supply and demand for schooling 74 0 10 furniture (10,000 sets)  - 39 - ANNEX C ANNEX C: BORROWER'S OPERATION PLAN The completion of project implementation does not mean the ending of the project. To make the project play an active role continuously and develop further, all the administrative departments of project units have the responsibility to support the project actively and efficiently. Based on the practical needs and the financial possibility, we made an action plan for the next five years (1995-1999). 1 . Five Teachers' Colleges (a) The scale of preservice students in the project colleges will be enlarged further from 8,200 to 9,200, of which 8,200 in teachers' education (1,000 inservice training included) and 1,000 in other specialties. (b) The training funds for per student will be increased from 2,900 in 1994 to 4,400 by 1999. (c) 4% of the college teachers will be arranged annually to undertake advanced studies. There will be 200 teachers trained to get master and doctor degrees or as visiting scholars. (d) 1,200 inservice teachers at lower secondary schools will be arranged to underrate academic training annually, 500 in provincial or prefectural education institutes, 300 in 5 teachers' colleges, 300 for TV education, 100 through corespondent and evening universities. There will be 6,000 personnel trained in five years. The annual training funds is 2 million yuan. For five years, the total funds will be 10 million yuan. (e) The annual maintenance funds of 400,000 yuan will be arranged for the project construction. The total funds for five years will be 2 million yuan. (f) The annual funds of 1 million yuan will be arranged for the maintenance and replacement of teaching equipment. The funds for five years will be 5 million yuan. 2. 23 Normal Schools (a) Since there is no shortage for primary school teachers in Gansu now, the future direction for normal schools development will be keeping the present schooling scale and raising the educational quality. The scale of 23 normal schools will be controlled between 15,000 to 16,000.  -40- ANNEX C (b) The annual training spending for per student will be raised from 1,500 in 1994 to 2,200 by 1999. (c) About 40 normal school teachers (3% of the total number) will be arranged annually to be trained in higher educational institutions inside or outside Gansu Province. The total number will be 200 in five years. (d) 600 inservice Teachers at primary schools will undertake training annually for academic qualification in county teachers' training schools and some normal schools. There will be 3,000 in five years. The annual training funds of 720,000 will be financed by prefectures and counties. It will be 3.6 million yuan for five years. (e) The annual funds of 40,000 will be arranged for the maintenance of project school buildings by responsible department of prefectures, (f) Provincial and prefectural education departments will join together to finance the maintenance and replacement of teaching equipment. The annual funds is 0.9 million yuan, and 4.5 million yuan for five years. 3. TV Education Institute (a) In the next five years, 75 satellite TV education centers as part of the continuous project will be set up in some normal schools, education institutes and teachers training schools. These TV centers will be used to extend the training and advanced studies for inservice teachers. The funds depend mainly on prefectures and counties, with provincial supplementary. (b) Our Province will arranged 400,000 yuan public funds annually to maintain and improve the working level after project implementation, and 100,000 yuan for equipment maintenance, replacement and supplementary parts. 4. Science Experiment Laboratories in 400 Lower Secondary Schools (a) 1,000 yuan will be arranged annually in each school for repair and replacement of the teaching aids, 300 from provincial finance, 300 from prefectures and counties and 400 from school itself. The total for five years will be 2 million yuan. (b) Short-term and long-term training workshops will continue to be used as the main way for science teachers to reinforce and raise their ability of experiment operation.  -41- ANNEX C (c) Among the other 600 lower secondary schools, 200 schools will be equipped with standard teaching aids in five years. By 1999, more than 70% of schools will be equipped. 5. The Center of School Administration (a) The scale of preschool students will be enlarged from 400 to 480. The annual enrollment of education administrative personnel and middle school principals will be 240. (b) The Center will arrange 3 teachers to be trained for academic diploma in each year, altogether 15 for five years. (c) The annual maintenance funds of 40,000 will be arranged for the project civil works, 100,000 for equipment. The annual funds will be 140,000 and 700,000 for five years. 6. Management of Education (a) The system of computer network will be gradually established at provincial, prefectural and county levels in five years to further enhance the dissemination of MIS research at grassroots units. (b) Every educational administration departments of county level and above will be equipped with at least a 386 computer within three years. The annual funds for procurement will be 1.2 million yuan, one third from provincial finance and two thirds from prefectures and counties. The total funds of three years will be 3.6 million yuan. (c) One to two months centralized training workshops will be conducted for grassroots personnel of MIS system in turn, 40 personnel at provincial level, 60 at prefectural level and 200 at county level. The training funds for five years will be 300,000 yuan, mainly financed by the Province.    I