Madagascar - Economic Management and Social Action Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 16272 IMPLEMENTATION COMPLETION REPORT REPUBLIC OF MADAGASCAR ECONOMIC MANAGEMENT AND SOCIAL ACTION PROJECT (Credit 1967-MAG) February 6, 1997 Country Departnent 8 Africa Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CtJRRENCY AND EQUIVALENT UNITS Currency unit = Malagasv fanc (FMG) (Average In FMG( per US dollar) 1988 1989 1990 1991 1992 1993 1994 1995 i996 1450 1532 1446 1833 1910 1963 3871 4265 4090* Note: The FMG began to float on May 1, 1994. * As of June 30, 1996. WEIGHTS AND MEASlJRES Metric system BORROWER'S FISCAL YEAR January 1 Decernmer 31 ABBREVIATIONS AND ACRONYMS ADB African Development Bank BDE Government Database BNCPP National Bureau for Coordination of the EMSAP project CRESAN Health Sector improvement Project DGGP Government Office in Charge of Privatization DGP Planning Department EMSAP Economic Management and Sociai Action Project EPM Permanent Household Survey FISA Fianakaviana Sambatra (Family Planning NGO) HIMO High Labor Intensity ILO International Labour Organization INSTAT National Institute of Statistics MPARA Ministry of Agriculture and Agrarian Reform NGO Nongovernmental organization PAIGEP Public Management Institutional Support Project PEP Public Expenditure Program PFP Policy Framework Paper PIP Public Investment Programin PRP Redeployment Program (Programime de Reinsertion Professionnelle) PSAC Public Sector Adjustment Credit SECALINE Food Security and Nutrition Project SME Small and medium-sized enterprises TAF Technical Assistance Fund UNDP United Nations Development Programme UNICEF Ulnited Nations Children's Fund WFP World Food Programme WHO World Health Organization Vice President Mr. Callisto Madavo Director Mr. Michael Sarris Manager Mr. Ok Panneniborg Staff Member Mr. Christian Rey, Task Manager  FOR OFFICIAL USE ONLY TABLE OF CONTENTS Introduction ....................................i Project Evaluation Summary .................................... ii 1. EVALUATION OF PROJECT EXECUTION .....................................1 A. Background ........................................I Country Background ................................................................................................................................ .................I The Economic Management and Social Action Project ............................................................................................3 B. Statement/Evaluation of Objectives .4 C. Achievement of Objectives .5 D. Major Factors Affecting the Project .9 E. Project Sustainability ...................9 F. Bank Performance .................................. ... I I G. Borrower Performance ..12 H. Assessment of Outcome ..12 . Future Operation .13 J. Key Lessons Learned .13 2. STATISTICAL DATA .14 TABLE 1: SUMMARY ASSESSMENTS .14 TABLE 2: OTHER BANK LOANS/CREDITS .16 TABLE 3: PROJECT TIMETABLE .17 TABLE 4: DISBURSEMENTS: PLANNED AND ACTUAL .17 TABLE 5: PERFORMANCE INDICATORS .18 TABLE 6: KEY INDICATORS FOR FUTURE OPERATION .18 TABLE 7: STUDIES INCLUDED IN THE PROJECT .19 TABLE 8A: PROJECT COSTS .21 TABLE 8B: PROJECT FINANCING .22 TABLE 9: COSTS AND ECONOMIC BENEFITS .23 TABLE 10: COMPLIANCE WITH LEGAL COVENANTS .24 TABLE 11: COMPLIANCE WITH OPERATIONAL MANUAL DIRECTIVES .26 TABLE 12: BANK RESOURCES - STAFF .26 TABLE 13: BANK RESOURCES - MISSIONS .27 APPENDICES A. Mission Aide-Memoire B. Borrower's Project Evaluation C. Map of Madagascar 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.   REPUBLIC OF MADAGASCAR IMPLEMENTATION COMPLETION REPORT ECONOMIC MANAGEMENT AND SOCIAL ACTION PROJECT (Credit 1967-MAG) INTRODUCTION 1. This document is the Implementation Completion Report (ICR) for the Economic Management and Social Action Project, for which Credit 1967-MAG, in the amount of US$22 million, was approved on December 6, 1988. The credit became effective on March 15, 1989. 2. The credit was closed on June 30, 1996, after the initially established closing date of June 30, 1994 had been extended twice. The last disbursement of the credit took place on December 5, 1996, and the undisbursed amount (US$0.33 million, or 1.36 % of the credit) was canceled on December 15, 1996. The Swiss Development Cooperation Agency contributed US$4.75 million and the United Nations Development Programme (UNDP) contributed US$1.00 million to project financing. Other cofinancing agencies were expected to contribute US$1.80 million (the United Nations Children's Fund [UNICEF]: US$0.3 million; the World Health Organization [WI-HO]: US$0.1 million; France: US$0.7 million; Italy: US$0.5 million; Japan: US$0.2 million). Final figures on the actual amount of other cofinancing are not available. 3. This report was prepared by Mr. Magaye Gaye (Consultant). Christian Rey, the Task Manager (AFMMG), contributed to it, and comments were received from Elaine Hubert (AFTC2) (most recent Country Officer for Madagascar). Preparation of the report began at the time of the last Bank supervision mission (March 11-16, 1996). Another mission visited Madagascar (October 1-18, 1996) to gather data and collect information for this report, which is based on the Staff Appraisal Report, the Development Credit Agreement, supervision reports, the public expenditure review report dated November 10, 1995, the Bank's Country Assistance Strategy (June 20, 1994), correspondence between the Bank and the Borrower, and other documents concerning the project. The Borrower participated in the preparation of the ICR, commented on the draft and prepared its own project evaluation, which the Bank received on November 11, 1996 (Appendix B).   PROJECT EVALUATION SUMMARY Country Background 1. Since independence in 1960, Madagascar's economic record is one of modest growth to 1970 followed by stagnation from 1970 to 1980. The disappointing growth performance of the 1970s stemmed largely from inappropriate economic policies emphasizing a much increased public sector role. Between 1978 and 1980, the Government embarked on an "all-out" public investment policy which included large and economically non-viable projects and resulted in a large debt accumulation. These policies, combined with deteriorating terms of trade, led to an 11 % decline in GDP from 1980 to 1982. During the 1983-1985 period, the Government carried out a generally successful stabilization program with IMF support which succeeded in halting the economic decline, and GDP grew by 1.4 % p.a. on average between 1983 and 1987. 2. In 1985, when the fiscal deficit and the inflation rate had been reduced to manageable levels, the Government turned its attention to structural adjustment efforts with the support of the Bank and other donors. The main thrust of the adjustment program was to correct the large currency overvaluation, reduce price controls, streamline and reform the inefficient parastatal sector and state-owned banking system, liberalize domestic and external trade and trim sharply Government interference in private economic activity. The Bank provided assistance to the program through four IDA adjustment credits: (i) the Industrial Assistance Credit (1985-US$ 60 million), which supported some initial price liberalization; (ii) the Agriculture Sector Adjustment Credit (1986-US$ 100 million including cofinancing), which mainly supported liberalization of rice marketing; (iii) the Industry and Trade Policy Adjustment Credit (1987-US$ 100 million including cofinancing), which mainly supported reform in the tariff and exchange regime; and (iv) the Public Sector Adjustment Credit (PSAC, 1988-US$ 180 million including cofinancing), whose objectives were to improve budget procedures and the preparation of public investments, reform the civil service, improve the effectiveness of the public enterprise sector, and liberalize and reform the public banking sector. The Economic Management and Social Action Project (EMSAP) was designed to accompany and support the PSAC. 3. In mid-1991, political turmoil swept the country, accelerating the pace of transition towards a more open society, but disrupting economic activity and, together with a policy backtrack in 1990, derailing the adjustment process. A transitional power- sharing arrangement was negotiated and a new coalition government was put in place in January 1992. Presidential elections took place in February 1993, legislative elections were held in June and in August the National Assembly chose its leadership and the prime minister, who announced most of his cabinet at the end of August 1993. The political transition was peaceful, but political factionalism and ambiguous commitment to economic reform adversely affected the economy and the adjustment process. In 1990-  93, GDP fell 4 % a year on average. Tax revenues were low and combined with lax management of expenditure, led to a budget deficit of 11 % of GDP. Foreign investment collapsed, and external arrears continued to grow. 4. Against this background, the PSAC, which was signed on July 18, 1988, never got back on track, and the credit was closed on September 30, 1993. The results of the project were considered unsatisfactory, their sustainability was regarded as uncertain and institutional development was viewed as negligible (ICR dated March 14, 1995). 5. More recently, economic management has haltingly improved. Stabilization measures contributed to growth in real GDP of 2 % and a drop in the budget deficit to 9 % of GDP in 1995. In parallel, the consensus for reform has gradually increased and the government has made progress on the adjustment agenda. A Policy Framework Paper (PFP) for 1996-99 was signed in September 1996, the IMF approved an ESAF in October 1996 and the Bank expects to be able to finalize a SAC in FY97. The Project 6. EMSAP was a multisector technical assistance project addressing needs related to: health, population, agriculture, nutrition, employment, infrastructure, nongovernmental organizations and economic/financial management. Such a project was considered crucial as an accompaniment to the PSAC, both to address the social dimensions of development, as well as to provide support for policy and institutional reform. 7. The objectives of the EMSAP were to: (a) initiate a program of emergency actions to reach the poorest and most vulnerable groups; (b) improve the government's capacity to monitor economic and social conditions and design the social programs and policies needed to respond to them; and (c) facilitate implementation of the structural adjustment program by strengthening key institutions responsible for economic management. 8. The project comprised the following three major components: Part A - Priority Social Action Program: malaria control; family planning; food security; studies on development of irrigation and smallholder livestock; survey on targeted food distribution; targeted job creation; coordination of nongovernmental organizations (NGOs) engaged in development activities; redeployment program (PRP); Part B - Actions Related to the Social Dimensions of Adjustment: creation and operation of a studies unit; permanent household survey (EPM); Part C - Economic Management: budget reform; reform of the Government Office in Charge of Privatization (DGGP); establishment of a study fund for the preparation, analysis and supervision of programs and projects designed to improve the economic and social database, implement economic adjustment policy, develop social policies and ensure economic growth. The content of these components is discussed in more detail in paragraph 1.10.  iv 9. The Staff Appraisal Report did not define performance indicators for monitoring implementation or achievement of objectives. 10. The project financing plan called for the African Development Bank (ADB) to cover part of the costs of the economic management component, up to US$4 million (Section 2, Table 8b). This financing was subsequently canceled, but sufficient financing was available under the IDA credit to cover all required expenditures. Achievement of Objectives 11. To assess the achievement of objectives, the project should be considered over two distinct periods: the time from effectiveness (March 1989) to October 1992 (when the project was reorganized), and the subsequent period until closing. During the first period, the rate of disbursements on the credit was low (20% of total funds disbursed) and little was achieved, owing to the following factors: (a) the confusion created, for both project and Bank staff, by the many expenditure categories; (b) the sluggish pace of procurement; and (c) the lack of a central agency for coordinating project activities. As a result of this last factor, nobody took the initiative or responsibility for setting up an accounting system, carrying out the initial audits, or forwarding to the Bank the annual status reports and work plans. The 1991 political turmoil blocked the economy during 12 months, further impeding project implementation. The second period started in November 1992, after the project was reorganized to improve implementation. The number of expenditure categories was cut from 42 to 28, and a National Project Coordination Bureau (BNCPP) was established for EMSAP with a national coordinator at its head. Meanwhile, efforts were made to improve procurement procedures for all Bank- financed projects in Madagascar. Project supervision, which had been coordinated by the AF3CO Division up to that point, was entrusted to AF3PH. This division stepped up the pace of supervision. The rate of disbursement jumped from 20 % to 99 % as of December 5, 1996 (date of last disbursement), and the main achievements of the project were obtained during this second project period. 12. Despite the difficulties encountered at the beginning, an important number of the project's objectives were achieved. Based on their targets, some activities could be considered as highly successful. These included primarily the emergency malaria control program, family planning, the cereal banks (under the food security component), labor- intensive road work, coordination of NGOs, the permanent household survey, budget reforn, and the study fund. The programs relating to rural saver groups and food for pre- school age children (under the food security component) both showed slow implementation under EMSAP, but were subsequently taken up by other Bank-financed projects. The PRP and DGGP components were problematic, due in part to the uncertain political and economic climate, but their objectives are now being pursued in other contexts. The poultry farming and marketing of subsidized food through canteens were both unsuccessful. Certain activities scheduled under the project proved not to have a committed constituency or were impossible to implement under the country circumstances and were never carried out. These included the promotion of new  v cropping opportunities and new nutritional foods in the food security component, and most of the studies component (Part A4). A detailed analysis of the results obtained, by component, is presented in paragraphs 1. 16 to 1.32. Sustainability and Future Operation 13. The results achieved during project execution will be sustained under certain projects currently under way and by ensuring maintenance for -- and improvements on -- what has been accomplished. EMSAP provided a basis for starting up a number of sectoral projects in the fields of health, rural finance and food security, and activities scheduled to take place as part of the original project are being carried out under these new projects. At the end of December 1993, the malaria control component was transferred to the new and more specialized CRESAN (Health Sector Improvement project). As a result, it has been possible to train people in the timely use of medication and to make them aware of the need to take responsibility for buying medicine. The nutritional interventions for pre-school age children under the food security component were incorporated into SECALINE (Food Security and Nutrition project, 1993). Work with rural saver groups is being carried out under the Rural Finance project (1993). The quality of the rehabilitation of rural roads under EMSAP was good. About 900 km were rehabilitated in 10 sub-prefectures located in the Toliary and Fianarantsoa Regions. However, maintenance of these roads is a critical problem that needs to be solved in the short term to prevent rapid deterioration, especially of those country roads that will eventually become national routes. Under the Malagasy road charter, local governments and others, including villages, NGOs and crop companies, are responsible for maintaining rural roadways. Four villages have joined forces to introduce tolls applicable to plows and vehicles. One of these villages has been collecting tolls on vehicles since January 1996. This initiative should be encouraged, and villages should be made aware of the need to maintain roadways. In view of the limited resources of local governments, other supplementary funds from the central government are needed in the forn of budget allocations. A National Fund is to be set up for road maintenance with resources coming from taxes on petroleum products. 14. Although the PRP and DGGP components of EMSAP suffered problems, due in part to the uncertain political and economic climate, the gradual development of a consensus around the need to undertake reform has revived commitment to privatization. With the completion of EMSAP, a decision was made by the Governrment to keep the PRP Implementation Unit in existence and to continue its activities using Government funds, in order to support the new program of privatization in preparation. To ensure a successful and effective economic development program, starting in 1997 the Government will launch a program for the gradual privatization, over a five-year period, of public enterprises, based on the schedule established in the PFP. Following the overall household survey (EPM), a series of specific surveys is planned, such as one already done on the poverty profile. These surveys will be conducted under the Public Management Institutional Support project (PAIGEP), for which Credit 291 1-MAG was signed in September and became effective in December 1996. The results achieved under the  vi budget reform component of EMSAP are being maintained with the preparation of the public investment and public expenditure programs (PIPs/PEPs) for 1997-99 and the work on the 1997 budget, which was completed in January 1997. Local capacity has been strengthened so that these outputs are produced by the planning and budget departments themselves. The various documents to be published in this connection are produced regularly, and improvements in their content and structure have been made. PAIGEP will continue to provide support to the planning and budgeting processes. 15. Overall, the long-term sustainability of the project's achievements will depend to a great extent on political and economic stability, and on the government's political will and its allocation of sufficient funds to operate the national services in question and to maintain rural roads. After a considerable period of political transition and consensus building, the Government is now showing its commitment to take economic reform measures. With a PFP signed and an ESAF approved, we expect that a SAC can be finalized during FY97. The Government has also shown its desire to continue capacity building, and pushed strongly for the Bank to proceed quickly with PAIGEP. These developments augur well for the EMSAP project achievements to be sustainable. Lessons Learned 16. The primary lessons to be drawn from this project are as follows: 17. Project structure and design should be simple and manageable. It proved to be unrealistic to undertake such a diverse project and complicated project structure. In their haste to attenuate the adverse effects of the structural adjustment program, the Bank and the Government designed an overly ambitious, multisectoral project that was difficult to appraise and implement, and costly to supervise. In view of the weak institutional capacity, the project should have been designed in a simpler fashion, and should have concentrated on those areas where the political climate and the institutional capacity were most conducive to success. 18. Project preparation should be participatory. Greater participation by the stakeholders (including the beneficiaries) at the design and preparation stages would have helped to make some objectives more realistic. Taking into account the interests of the persons concerned during the design process helps guarantee that they will take responsibility for the project, that the results will be lasting, and that the project will be better implemented. This lesson was applied in developing PAIGEP, which was prepared with broad-based beneficiary participation. 19. Rural roads rehabilitation should be accompanied by commensurate arrangements to ensure funding for maintenance. 20. As regards privatization, the Bank should realistically evaluate the Government's political will to undertake this action and carry it to a successful conclusion. It should also make sure that a framework for the privatization process is in place, that there are institutional mechanisms for ensuring transparency and strict compliance with the law  vii during the Government's divestiture, and that recovery of privatization proceeds will be managed rigorously. 21. Performance indicators should be defined by the Bank and the Government during project preparation, and they should be monitored during implementation. 22. During project preparation, the Bank should make sure that the Government's executing agencies, and especially any newly established ones, have effective financial management and accounting systems to guarantee that project funds are well managed and that financial statements are produced promptly. 23. Finally, operations financed by cofinancing agencies should be reflected in the project's financial statements, even if the funds in question are not managed by the Bank. Failure to record these operations is contrary to the principle that records be comprehensive, with all project resources and expenditures entered in the accounts. In future, arrangements should be made so that cofinanced operations can be recorded in the accounts by the project executing agency.  REPUBLIC OF MADAGASCAR IMPLEMENTATION COMPLETION REPORT ECONOMIC MANAGEMENT AND SOCIAL ACTION PROJECT (Credit 1967-MAG) 1. EVALUATION OF PROJECT EXECUTION A. BACKGROUND Country Background 1.1 Madagascar is one of the poorest countries in the world, with a per capita income of $230 in 1995. It covers an area of 587,000 km2, and, according to the 1993 census, its population is 12.7 million and is growing at a rate of 3% per year. Agriculture contributes nearly 33% of the gross domestic product, and accounts for 80% of employment and 60% of export revenues. The industrial sector accounts for 14 % of GDP. 1.2 Since independence in 1960, Madagascar's economic record is one of modest growth to 1970 followed by stagnation from 1970 to 1980. The disappointing growth performance of the 1970s stemmed largely from inappropriate economic policies emphasizing a much increased public sector role, with import substitution in industry as the central objective and agriculture in a support role and pervasive controls on private economic activity. Between 1978 and 1980, the Government embarked on an "all-out" public investment policy which included large and economically non-viable projects and resulted in a large debt accumulation. These policies, combined with deteriorating terms of trade, led to an 11 % decline in GDP from 1980 to 1982. 1.3 During the 1980s, the focus of economic management moved from the urgent need for financial stabilization with IMF assistance in the first part of the decade to supply-oriented measures supported by the Bank and the Fund in the second part. Between 1983 and 1987, the economic decline of the preceding three years was arrested and the economy grew at a modest rate of 1.4 % per annum. The improved policy environment contributed to an acceleration of economic growth starting in 1988, when GDP grew faster than population at 3.4 %. The economy continued to grow by another 4.1 % in 1989 and by 3.1 % in 1990. In 1990, however, lax credit policies led to increased inflation and to the depletion of external reserves. 1.4 In 1985, when the fiscal deficit and the inflation rate had been reduced to manageable levels, the Government turned its attention to structural adjustment efforts with the support of the Bank and other donors. The main thrust of the adjustment program was to correct the large currency overvaluation, reduce price controls, streamline and reform the inefficient parastatal sector and state-owned banking system, liberalize domestic and external trade and trim sharply  2 Government interference in private economic activity The Bank provided assistance to the program through four IDA adjustment credits: (i) the Industrial Assistance Credit (1985-US$ 60 million), which supported some initial price liberalization; (ii) the Agriculture Sector Adjustment Credit (1986-US$ 100 million including cofinancing), which mainly supported liberalization of rice marketing; (iii) the Industry and Trade Policy Adjustment Credit (1987-US$ 100 million including cofinancing), which mainly supported reform in the tariff and exchange regime; and (iv) the Public Sector Adjustment Credit (PSAC, 1988-US$ 180 million including cofinancing), whose objectives were to improve budget procedures and the preparation of public investments, reform the civil service, improve the effectiveness of the public enterprise sector, and liberalize and reform the public banking sector. 1.5 There is widespread, extreme poverty in Madagascar, even by the standards of Sub- Saharan Africa. Social conditions are poor: life expectancy is 51 years of age, the mortality rate for children under the age of 5 is 15%, the malnutrition rate in some areas is 40%, and certain infectious diseases, such as malaria and tuberculosis, proliferate. The rate of underemployment in the country is high, with only 2.7% of the population working in the non-farm sector. Budget cuts in current expenditures have affected the Government's management and planning, as well as its capacity for gathering and analyzing key economic data. These circumstances were already well-recognized by the Government at the time of the adjustment dialogue during the late 1980s, and it is in this setting that the Government asked for the Bank's assistance both to address the social dimensions of development, as well as to provide support for the preparation and implementation of policy and institutional reform. The Economic Management and Social Action Project (EMSAP) was designed in 1988 to accompany and support the PSAC. EMSAP was a multisector technical assistance project addressing needs related to: health, population, agriculture, nutrition, employment, infrastructure, nongovernmental organizations and economic and financial management 1.6 In mid-1991, political turmoil swept the country, accelerating the pace of transition towards a more open society, but disrupting economic activity and, together with a policy backtrack in 1990, derailing the adjustment process. A transitional power-sharing arrangement was negotiated and a new coalition government was put in place in January 1992. Presidential elections took place in February 1993, legislative elections were held in June and in August the National Assembly chose its leadership and the prime minister, who announced most of his cabinet at the end of August 1993. The political transition was peaceful, but political factionalism and ambiguous commitment to economic reform adversely affected the economy and the adjustment process. In 1990-93, GDP fell 4 % a year on average. Tax revenues were low and combined with lax management of expenditure, led to a budget deficit of 11 % of GDP. Foreign investment collapsed, and external arrears continued to grow. 1.7 Against this background, the PSAC, which was signed on July 18, 1988, never got back on track, and the credit was closed on September 30, 1993. The results of the project were considered unsatisfactory, their sustainability was regarded as uncertain and institutional development was viewed as negligible (ICR dated March 14, 1995).  3 1.8 More recently, economic management has haltingly improved. Stabilization measures contributed to growth in real GDP of 2 % and a drop in the budget deficit to 9 % of GDP in 1995. In parallel, the consensus for reform has gradually increased and the government has made progress on the adjustment agenda. A Policy Framework Paper (PFP) for 1996-99 was signed in September 1996, the IMF approved an ESAF in October 1996 and the Bank expects to be able to finalize a SAC in FY97. The Economic Management and Social Action Project 1.9 The objectives of the project were to: (a) initiate a program of emergency actions to reach the poorest and most vulnerable groups; (b) strengthen the Government's capacity to monitor economic and social conditions and design the social programs and policies necessary for responding to them; and (c) facilitate implementation of the structural adjustment program by building the capacity of key institutions responsible for economic management. 1.10 The project comprised the following components: (a) Part A1 - Malaria control: A whole series of measures, ranging from improved distribution of chloroquine to other essential drugs, to put an end to the sharp increase in mortality and morbidity caused by this disease in recent times. (b) Part A2 - Family planning: Communication of family planning messages to 30% of the population, increase in both the quality and the quantity of the family planning services provided, ensuring that people were educated and informed as to clinical aspects of family planning, and support for the introduction of a long-term population policy. (c) Part A3 - Food security: Pilot operations and studies to ensure the provision of foodstuffs and an adequate, stable income for the poorest segments of the population. (d) Part A4 - Studies: Various studies in the areas of developing irrigation, promoting small livestock farmers, developing sub-sector industrial strategy, debt conversion including the feasibility of debt/environment swaps, definition of a structure to coordinate the identification, appraisal and financing of small socially-oriented projects, and a survey of targeted distribution of food products. (e) Part A5 - Targeted job creation: Construction or repair of rural roads using labor- intensive methods. (f) Part A6 - Coordination of nongovernmental organizations (NGOs): Improvement of the database on NGOs active in Madagascar, and creation and operation of a coordination and information system on NGOs.  4 (g) Part A 7 - Redeployment Program: A redeployment fund and a reemployment program to assist employees of public enterprises affected by the divestiture of this sector by accelerating payment of severance benefits and helping prepare for alternative employment. (h) Part B] - Studies unit: Creation of a studies unit in the Directorate of Social Planning of the Planning Department (DGP) to support the various ministries in designing and monitoring social programs. (i) Part B2 - Permanent household survey: A permanent survey of households to measure their living conditions, identify target groups requiring assistance, and evaluate the impact of that assistance. (I) Part C1 - Budget reform: Assistance in the preparation of sector strategies, triennial public investment programs (1989-91 and 1990-92) and public expenditure programs (1989 and 1990-92), and review of budget procedures. (k) Part C2 - DGGP: Implementation of the Government's action program for the public enterprises that it intended to liquidate or privatize, and support for the Government's agency for monitoring, rehabilitating and restructuring public enterprises. (1) Part C3 - Study Fund: Undertaking of studies for the preparation, analysis, and supervision of programs and projects designed to improve the economic and social database, implement economic adjustment policy, develop social policies and ensure economic growth. 1.11 The project was to be implemented -- under the general coordination of the DGP -- by nine executing agencies, including six ministries. B. STATEMENT/EVALUATION OF OBJECTIVES 1.12 The project's objectives were consistent with the Government's strategy, supported by the Bank, to promote sustainable economic growth as a means of improving living standards, while at the same time undertaking targeted programs to protect the disadvantaged, and with the Government's letter of development policy, in support of which the Executive Directors had approved the PSAC in June 1988. However, the project's design was complicated, since in a single operation it provided for action in several sectors in order to achieve short-term results (i.e. malaria control, food security, targeted job creation, redeployment, and studies), as well as medium-term results (institutional development, the household survey, coordination of NGOs, and budget reform). The food security component alone contained seven different programs, which were sometimes not clearly defined. There were 42 expenditure categories, but there were no plans to set up an independent structure to coordinate activities under the project. As for the PRP, grants of equipment were not initially provided for, and it was not until implementation that it was realized that they were needed.  5 1.13 The tools proposed in the Staff Appraisal Report (SAR) for monitoring achievement of the objectives were the accounts, audits and annual status reports. No specific performance indicators were defined. C. ACHIEVEMENT OF OBJECTIVES 1.14 To assess whether objectives were achieved, the project is divided into two periods: the time prior to October 1992; and the period subsequent to that date. During the first period, the disbursement rate was low (20%), owing to the following factors: (a) the confusion created, for both project and Bank staff, by the many expenditure categories; (b) the sluggish pace of procurement; and (c) the lack of a central agency for coordinating project activities. As a result of this last factor, nobody took the initiative or responsibility for setting up an accounting system, carrying out the initial audits or forwarding to the Bank the annual status reports and work plans. In October 1992, the project was reorganized to improve implementation. Among other things, the number of expenditure categories was reduced to 28 and a National Project Coordination Bureau (BNCPP) was established for the project, with a national coordinator at its head. 1.15 Despite the difficulties encountered at the beginning, an important number of the project's objectives were achieved. In general terms, the project has been crucial to the Bank's ability to pursue economic reform issues in a difficult and changing political situation in Madagascar, as well as to develop important programs for assistance to the poor. Based on their targets, some activities could be considered as highly successful. These included primarily the emergency malaria control program, family planning, the cereal banks (under the food security component), labor-intensive road work, coordination of NGOs, the permanent household survey, budget reform, and the study fund. The programs relating to rural saver groups and food for pre- school age children (under the food security component) both showed slow implementation under EMSAP, but were subsequently taken up by other Bank-financed projects (the Rural Finance and SECALINE Projects, respectively -- both 1993). The PRP and DGGP components were problematic, due in part to the uncertain political and economic climate, but their objectives are now being pursued through preparation for the Private Sector Capacity Building Project and macroeconomic dialogue. The poultry farming and marketing of subsidized food through canteens were both unsuccessful. Certain activities scheduled under the project proved not to have a committed constituency or were impossible to implement under the country circumstances and were never carried out. These included the promotion of new cropping opportunities and new nutritional foods in the food security component, and most of the studies component (Part A4). A detailed analysis of the results obtained, by component, is presented below. 1.16 Part Al: Malaria Control. This component was to be financed in large part by the Swiss Development Cooperation Agency, and to a lesser degree by UNDP and UNICEF. The Swiss Agency financed the purchase of 300,000 boxes of chloroquine containing 1,000 pills each and essential drugs, in the form of balance of payments assistance. Italy financed the purchase of 45 tons of DDT. IDA defrayed the cost of training trainers of chloroquine dispensers and of paying the persons responsible for spraying the insecticides. Activities under this component ceased on  6 December 31, 1993, when the new CRESAN project (effective in 1992) assumed responsibility for them. 1.17 Part A2: Family Planning. This part of the project was to be financed completely by UNDP, with FISA -- a nongovermmental organization -- acting as executing agency. Most of the targeted objectives were attained: (i) with 166,000 clients already registered for family planning, 14,000 new clients were added, as compared to the projected 15,000; (ii) three of the four laboratories planned were prepared and equipped; (iii) 407 health students and professionals were trained, compared with the intended 750. 1.18 Part A3: Food Security. Of the seven programs in this component, the most successful one was the cereal bank. Fourteen collective village granaries were built in various parts of the country, and of those eleven are still in operation. The other three were destroyed by cyclone Geralda. The rural saver groups component was implemented under the Rural Finance project (with World Bank financing, 1993), after a study conducted by WCOCU (the World Council of Credit Unions). The program to market subsidized food through canteens, ten of which were located in Tananarive and two in Fianarantsoa, operated from 1989 to 1992, before being shut down. This effort to diversify the nutritional base of the poor failed, among others, due to the strong preference of the target group for the traditional rice diet and to the higher cost of alternative foods, even when subsidized. The urban poultry farming component was stopped after the first grant of laying hens in 1989, following a high death rate. The nutrition-related initiatives component (children's feeding and promotion of new cropping opportunities) was in operation only during the first half of 1991. It was impossible to implement the children's feeding program after that due to the insecurity created by the political situation in the country -- demonstrations and general strikes. Mothers feared to go out with their under-five-year-old children to get nutritional food. Finally, this component was incorporated into the Bank's SECALINE project, which was put into operation in 1993. The promotion of new cropping opportunities and new nutritional foods never became operational. 1.19 Part A4. Studies. The survey on the targeted distribution of food products was conducted in late 1990. However, studies on developing irrigation, promoting small livestock farmers, developing a sub-sector industrial strategy, debt conversion and coordinating small socially-oriented projects were never carried out. 1.20 Part A5: Targeted Job Creation. HIMO road work is believed to have had a positive socioeconomic impact. About 900 km of rural roads were rehabilitated, compared to the 700 km initially planned, certain regions were opened up, jobs (50,719 man-months) and income (FMG 3.5 billion) were created, and 158 small and medium-sized businesses were trained in road construction and repair. 1.21 Part A6 Coordination of NGOs. The objective was to make an inventory of the NGOs participating in the country's economic and social development, so as to improve the database in the Population Ministry. Records were established, and are updated periodically. A liaison bulletin is published quarterly. In addition, a law on the status of NGOs has been prepared in consultation with donors and NGOs and is awaiting adoption by the National Assembly.  7 1.22 Part A 7. Redeployment Program. The specific objectives of the PRP were to help workers who had lost their jobs (as a result of either staff cuts or the shutdown of goverrnent enterprises) to find gainful employment elsewhere The privatization process was followed by the distribution of resources from a redeployment fund to be supplied by the Government. The fund consisted of payments for workers in receipt of advance notice, severance pay, accumulated leave, one month's wages, and any remaining unpaid wages. These entitlements were meant to be paid by the Government prior to any recourse to the PRP, which then financed grants and equipment to set workers up in new jobs Out of' the estimated cost of this component (US$7.49 million), IDA was to provide US$4.17 million in financing (56 %), while the Government was expected to contribute US$2.88 million (38 %)! and UNDP US$0.44 million (6 %). 1.23 From 1989 to 1996. the number of people who lost employment rose to 6,590 in 23 enterprises. The amounts paid for these lay-offs totaled FMG 8.8 billion, or about US$806,000. Of the 6,590 persons dismissed (initial estimates put the number of eligible employees at 7,000), 4,948 persons were covered by the PRP. Only 26% of all recipients were successful in finding remunerative self-employment, and the remaining 74% did not manage to find lasting gainful employment. 1.24 Part B]. Studies Unit. This unit was established in the Planning Department (DGP), but was neglected once BNCPP was established and took responsibility for the studies. 1.25 Part B2. Permanent Household Survey. The main report of the survey, dated December 1995, was issued in January 1996. Three workshops were organized in January, March and April 1996 to analyze the data from the survey and disseminate the results Another report entitled "Training of' Malagasy Women in the Struggle Against Poverty" was published in June 1996, The original goals of the survey were achieved, in that it increased the institutional capacity of the Government Database (BDE/INSTAT) bv setting up a database on households that could be used to prepare a number of specific studies for the Government and lenders. A general document was published, in addition to theme papers on various subjects such as Women and Development, Agriculture, Education, Health, Employment and Food Security. 1.26 Part Cl] Budget Reform. The results accomplished in this area are satisfactory, and include the following: (i) preparation of annual PIPs starting in 1989 through the present (last PIP produced covered 1996-98), and PEPs for the same period, using revised methodology; (ii) revision of budget procedures beginning with the 1993 budget: a new budget and functional nomenclature was put into practice and budget preparation and execution procedures were revised, and (iii) preparation of a handbook for budget execution. The Bank's assistance took the form of financing office furniture and computer hardware, training costs, and the cost of four technical assistants, two of whom were expatriate and two local. The PIPs, the PEPs and budgets are published annually, and the Report on Financial and Physical Execution and the Report on Foreign Aid Disbursements (parts of the PlPs) are published quarterly. In addition, in order to have information on the status of commitments., settlements, and payment orders under the operating budget, a budget performance chart is published monthly. This portion of the project has helped realize major improvements in public finance reform (improved planning and  8 budgeting procedures and composition of expenditures), providing an important underpinning to the economic dialogue and pursuit of the adjustment agenda. 1.27 The project financing plan called for the African Development Bank (ADB) to cover part of the costs of the economic management component (budget reform and economic studies), up to US$4 million (Section 2, Table 8b). This financing was subsequently canceled, but sufficient financing was available under the IDA credit to cover required expenditures. 1.28 Part C2. DGGP. The objective of this component was to conduct financial, legal and economic studies to assess the viability of public enterprises, and determine whether to privatize or restructure them. The objectives were not achieved, since, of the 90 enterprises to be covered, only 52 were privatized or liquidated, and 22 liquidations that had been announced either have not been completed or have not begun. After the Government brought the process to a halt in June 1993, the Bank stopped the line of credit in November 1993. DGGP was dissolved in 1994 and replaced by a Committee for the Refonn of the Public Enterprise Sector. This Committee could not be operational before the adoption of a privatization law (August 1996) as required by the new Constitution. In conjunction with preparation of the proposed Private Sector Capacity Building Project (FY97), an independent privatization committee was set up on November 22, 1994. It was given the task of reviewing the enterprises that had been privatized so far and the obstacles and problems they had encountered, and of proposing structures and methods that would guarantee maximum transparency and efficiency to all parties concerned in the privatization program that the Government intends to resume. This committee was also asked to draft framework legislation on the privatization of public enterprises, which had never been done before. 1.29 Part C3: Study Fund. This fund made it possible to carry out various studies important to the portfolio of projects in Madagascar; several studies also supported the economic dialogue underway between the Government and the Bank. Among the studies undertaken were: a participatory assessment of poverty in Madagascar; an evaluation of the socioeconomic impact of AIDS in Madagascar; a study of national accounts; restructuring of JIRAMA (the water and electricity company); and evaluation of the beneficiaries of the HIMO and PRP programs. This last study was truly innovative, since the executing agencies of the two components concerned took the initiative in evaluating themselves in order to improve the services provided to beneficiaries. 1.30 Certain activities which were not originally scheduled to take place under the project were financed out of EMSAP funds. For instance, additional funds were needed to ensure the transportation of emergency aid, i.e. 15,000 tons of rice, in southern Madagascar. Other examples are the work to repair the infrastructure destroyed by cyclones Daisy and Geralda, the farm rehabilitation work following the damage caused by cyclones in Toamasina, and the program to place farmers on new plots of land, which was cofinanced by UNDP and FAO. 1.31 During implementation of the project, the Bank and UNDP financed the services of seven technical assistants: four for the budget reform component (a total of 74 months), two for the HIMO component (16 months), and one for the PRP component (15 months). This technical  9 assistance staff included specialists in: government planning and finance, management, procurement, public works, engineering and labor organization. Generally speaking, the technical assistance was beneficial to the project, since nationals gradually took over and continued the work under the program. 1,32 In the area of training, 111 civil servants received training abroad in the following fields: government budget preparation; enterprises in difficulty; procurement; project management; road maintenance; survey techniques; processing survey data; and national accounts. The duration of seminars and courses ranged from one week to three months. Several employees in the Ministries of Budget and Planning received local training in computers and the use of hardware and software. D. MAJOR FACTORS AFFECTING THE PROJECT 1.33 Project implementation was affected by a number of factors, both general (i.e. affecting the entire project) and specific to individual components of the program. General factors include: (a) poor project design (see para. 1.14.), making it necessary to restructure the project in October 1992; (b) lack of strong project leadership initially, which was reflected in a lack of accountability; (c) the Government's failure to provide sufficient counterpart funds; (d) problems encountered by project managers in gaining access to IDA funds deposited in special accounts opened with the Central Bank, as any movements in these accounts required a Treasury signature; and (e) sluggish procurement procedures, as a result of repeated controls by various central agencies. The situation became worse in July 1991 as the political situation grew unstable. Large demonstrations and general strikes (which were not predictable) paralyzed the Government and seriously disrupted the economy. 1.34 In addition to these general factors, there were specific problems that affected some of the components. In the case of the PRP, a long period of time, up to a year, would sometimes go by between the time persons were eligible for PRP compensation and the time they actually received grants of equipment so that they could start up their chosen work. In some cases, the equipment granted did not match the requests, and added to that were delays in delivery. The PRP, which was under the authority of the Ministry of Employment, went through a period of floating from one institution to the next from August 1993, when that Ministry disappeared, until February 1994, when the PRP was placed under the Ministry of Economy and Planning. The DGGP was beset by financial and legal problems. Financially, recovery of privatization proceeds was not managed rigorously, and the monitoring and control of liquidators or receivers were especially lax. From a legal standpoint, the inadequate legal basis for privatization operations and the weakness of the institutional system for carrying out the process deprived the first round of privatizations of its legitimacy. No law was passed to establish the rules and the institutional framework. More importantly, the political commitment was missing. E. PROJECT SUSTAINABILITY 1.35 The results achieved during project execution will be sustained under certain projects currently under way and by ensuring maintenance for -- and improvements on -- what has been  10 accomplished. EMSAP provided a basis for starting up a number of sectoral projects in the fields of health, rural finance and food security, and activities scheduled to take place as part of the original project are being carried out under these new projects. At the end of December 1993, the malaria control component was transferred to the new and more specialized CRESAN. As a result, it has been possible to train people in the timely use of medication and to make them aware of the need to take responsibility for buying medicine. The nutritional interventions for pre-school age children under the food security component were incorporated into SECALINE (1993). Work with rural saver groups is being carried out under the Rural Finance project (1993). The quality of the rehabilitation of rural roads under EMSAP was good. About 900 km were rehabilitated in 10 sub-prefectures located in the Toliary and Fianarantsoa Regions. However, maintenance of these roads is a critical problem that needs to be solved in the short term to prevent rapid deterioration, especially of those country roads that will eventually become national routes. Under the Malagasy road charter, local governments and others, including villages, NGOs and crop companies, are responsible for maintaining rural roadways. Four villages have joined forces to introduce tolls applicable to plows and vehicles. One of these villages has been collecting tolls on vehicles since January 1996. This initiative should be encouraged, and villages should be made aware of the need to maintain roadways. In view of the limited resources of local governments, other supplementary funds from the central government are needed in the form of budget allocations. A National Fund is to be set up for road maintenance with resources coming from taxes on petroleum products. 1.36 Although the PRP and DGGP components of EMSAP suffered problems, due in part to the uncertain political and economic climate, the gradual development of a consensus around the need to undertake reform has revived commitment to privatization. With the completion of EMSAP, a decision was made by the Government to keep the PRP Implementation Unit in existence and to continue its activities using Government funds, in order to support the new program of privatization in preparation. To ensure a successful and effective economic development program, starting in 1997 the Government will launch a program for the gradual privatization, over a five-year period, of public enterprises, based on the schedule established in the PFP. Following the overall household survey (EPM), a series of specific surveys is planned, such as one already done on the poverty profile. These surveys will be conducted under PAIGEP (effective in December 1996). The results achieved under the budget reform component are being maintained with the preparation of the PIPs/PEPs for 1997-99 and the work on the 1997 budget, which was completed in January 1997. Local capacity has been strengthened so that these outputs are produced by the planning and budget departments themselves. The various documents to be published in this connection are produced regularly, and improvements in their content and structure have been made. PAIGEP will continue to provide support to the planning and budgeting processes. 1.37 Overall, the long-term sustainability of the project's achievements will depend to a great extent on political and economic stability, and on the government's political will and its allocation of sufficient funds to operate the national services in question and to maintain rural roads. After a considerable period of political transition and consensus building, the Government is now showing its commitment to take economic reform measures. With a PFP signed and an ESAF approved, we expect that a SAC can be finalized during FY97. The Government has also  11 shown its desire to continue capacity building, and pushed strongly for the Bank to proceed quickly with PAIGEP. These developments augur well for the EMSAP project achievements to be sustainable. F. BANK PERFORMANCE 1.38 The project was initially scheduled to be implemented over five years. The closing date of the credit was postponed on two occasions, which had the effect of prolonging the life of the project by two and a half years. The Bank devoted considerable resources to the various stages of the project cycle, for a total of 351 staff weeks (sw) and a cost of about $842,500 (see Section 2, Table 12). The cost of these resources accounts for 3.6% of the funds disbursed ($23.24 million). In terms of time, the Bank's contribution can be broken down as follows: (i) 28 sw for project preparation; (ii) 61 sw for appraisal; (iii) 25 sw for negotiation and approval by the Board; (iv) 231 sw for project supervision, spread out over seven years, at the rate of 33 sw per year in the field and at headquarters; and (v) 6 sw for project completion. 1.39 Project identification and preparation began in February 1988. The Bank's performance during identification is considered satisfactory overall, because of the efforts to make the project's objectives consistent with the Government's strategy and letter of development policy in the relevant sectors. The Bank's performance during preparation is deficient for the following reasons: a) it did not define indicators for monitoring implementation or achievement of objectives; b) it did not anticipate the need for a more solid and transparent framework for the privatization process; c) it designed a project that was too complex; and d) it underestimated the coordination and management capacity needed to implement such a complex project. Although the Bank identified three major risks (related to the complexity of the project, the accuracy of the targeting used in designing the social interventions, and the ability of the Government to ensure that the assistance went only to the intended beneficiaries), it underestimated their magnitude and the scope of the measures needed to remedy them. 1.40 The Bank's project appraisal was inadequate because it failed to recognize or address the above deficiencies in preparation. 1.41 The Bank's performance during the first period of supervision, i.e. before the reorganization of the project, was unsatisfactory. Due to the multifaceted nature of the project, the Bank followed a decentralized supervision strategy, using the talents of different divisions/departments. While this approach had its advantages (flexibility, use of best expertise), it led to a failure to focus on and resolve the project's problems in a timely fashion. In addition, project ratings did not reflect the seriousness of the project's problems. When project management was given to AF3PH, a mission (including an implementation specialist) was sent to the field to make an assessment of the situation and recommendations to improve project implementation. As a result, the project was restructured in October 1992. In view of the Government's inability to provide the counterpart funds in the amounts and at the times required, the Bank amended the Credit Agreement on June 10, 1993, increasing its share of the financing for expenditures on roads (Category 4e) from 85% to 100% (net of taxes). Beginning in July 1994, the Resident Mission played an important role in monitoring activities because the task  12 management for EMSAP was assigned to the field. Based on the positive results after project restructuring, the Bank's performance during the supervision phase was satisfactory overall. G. BORROWER PERFORMANCE 1.42 The Borrower's performance during the project identification and preparation phase was considered satisfactory, in view of the role it played and the initiative it took in identifying the components of the project. However, greater participation by the stakeholders (including the beneficiaries) at the design and preparation stages would have helped to make some objectives more realistic. 1.43 During implementation, the Borrower's performance was considered unsatisfactory during the first period, due to the problems the project encountered before it was restructured (October 1992). Once the BNCPP was established, the situation improved: an operational, computerized system of accounts was set up; audits pending for the years 1989, 1990 and 1991 were completed, and continued for later years; a quarterly audit of statements of expenditures was introduced in January 1993; nine news bulletins on EMSAP were published by the media; and the disbursement rate of the IDA credit increased from 20% as of September 30, 1992 to 99% at the end of the project. Moreover, by using savings realized due largely to the depreciation of the Malagasy franc, the Government was able to finance a large part of the work to restore the infrastructure destroyed by cyclones Daisy and Geralda and the work to rehabilitate farmlands. Overall, the performance of the Borrower was satisfactory during implementation. 1.44 In view of the dynamic nature and the performance of the BNCPP team, the decision was made to entrust it with managing PAIGEP. 1.45 The Government's performance fell short with respect to the payment of counterpart and redeployment funds, and to submitting audit reports at the required times. Audit reports for the fiscal years from 1991 to 1995 were sent to the Bank late, except for the 1993 report (Section 2, Table 10). Moreover, operations financed by cofinanciers were not entered in the accounts, contrary to the principle that all resources and expenditures relating to a project should be reported in its financial statements. H. ASSESSMENT OF OUTCOME 1.46 In reference to the summary assessments (Section 2, Table 1), most of the physical objectives were achieved and even in some cases surpassed: malaria control, cereal banks under the food security component, labor-intensive road work, and coordination of NGOs. The objectives linked to institutional development were achieved in the areas of budget reform and production of the permanent household survey. The objectives in the area of sector policies were either partially realized or transferred to other projects (including rural saver groups, food for pre-school age children, public sector management [DGGP] and development of the private sector [PRP]), or in a few cases were unrealized (poultry farming and the promotion of subsidized food through canteens). The project had a substantial impact on financial objectives (disbursements) and helped provide some protection to vulnerable groups during difficult economic times (poverty objective). The results are likely to be sustainable. The performance of  13 the Bank and the Borrower was satisfactory, except for the Government's failure to comply with certain conditions and the poor performance of the Bank during the first period. All things considered, the performance is evaluated as generally satisfactory. I. FUTURE OPERATION 1.47 To ensure the long-term sustainability of the reforms initiated under EMSAP, the Government is committed to building its economic management capacity and the capacity of its public administration. It has requested the Bank's assistance under PAIGEP to continue to strengthen and develop these capacities. In the area of economic management, PAIGEP will improve the Government's ability to design and implement an economic reform program, as well as to target public expenditures in the fight against poverty. As regards public administration, PAIGEP will help the administration, the civil service, and the judicial system to develop and start implementing a new vision of government. In addition, some elements of EMSAP are being carried out under the CRESAN, SECALINE and Rural Finance projects. J. KEY LESSONS LEARNED 1.48 The primary lessons to be drawn from this project are as follows: 1.49 Project structure and design should be simple and manageable. It proved to be unrealistic to undertake such a diverse project and complicated project structure. In their haste to attenuate the effects of the structural adjustment program, the Bank and the Government designed an overly ambitious, multisectoral project that was difficult to appraise and implement, and costly to supervise. In view of the weak institutional capacity, the project should have been designed in a simpler fashion, and should have concentrated on those areas where the political climate and the institutional capacity were most conducive to success. 1.50 Project preparation should be participatory. Greater participation by the parties involved (including the beneficiaries) at the design and preparation stages would have helped to make some objectives more realistic. Taking into account the interests of the persons concerned during the design process helps guarantee that they will take responsibility for the project, that the results will be lasting and that project implementation will be more effective. This lesson was applied in developing PAIGEP, which was prepared with broad-based beneficiary participation. 1.51 Rural roads rehabilitation should be accompanied by commensurate arrangements to ensure fimding for maintenance. 1.52 In the area of privatization, the Bank should realistically evaluate the Government's political will to undertake this action and carry it to a successful conclusion. It should also make sure that there is a proper framework for the privatization process and institutional mechanisms for ensuring transparency and strict compliance with the law during the Government's divestiture, and that recovery of privatization proceeds will be managed rigorously. 1.53 Performance indicators should be defined by the Bank and the Government during project preparation, and monitored during implementation.  14 1.54 During project preparation, the Bank should make sure that the government executing agencies, and especially newly-established ones, have reliable financial management and accounting systems to ensure effective planning and procurement procedures, sound management of the project's resources, and the prompt production of financial statements. 1.55 Finally, operations financed by cofinancing agencies should be reflected in the project's financial statements, even if the funds in question are not managed by the Bank. Failure to record these operations is contrary to the principle of comprehensive reporting, according to which all the resources and expenditures of a project are to be entered in the accounts. In future, arrangements should be made so that cofinanced operations can be recorded in the accounts by the project executing agency. 1.56 In the Government's assessment of the project (Appendix B), it confirmed many of the above lessons learned, and added a few more: (i) assess and agree on clear roles and duties of each entity involved in the project, including arrangements for project coordination and organization (the experience with a national coordination bureau has been positive); (ii) use a more participatory approach during project preparation and implementation; (iii) continue the labor-intensive works initiative; (iv) take other donor financing into account in the project accounts and evaluation of the project; (v) maintain Bank decentralization through a resident specialist in project implementation; and (vi) strengthen seminars on procurement and disbursement, and portfolio reviews through participation of NGOs, decentralized government entities and beneficiaries in addition to government ministries and project coordinators. 2. STATISTICAL DATA Table I. Summary Assessments A. Achievement of Objectives Substantial Partial Negligible Not applicable Macroeconomic . Sector policies I Financial objectives / Institutional development / Physical objectives / Poverty alleviation Gender concerns Other social objectives Environmental objectives Public sector management  15 Private sector development |l Other(indicate) l l I l l B. Project Sustainability Likely Unlikely j Uncertain C. Bank Performance Highly Satisfactory Deficient Satisfactory_ Identification / Preparation assistance . Appraisal Supervision D. Borrower Performance Highly Satisfactory Deficient ___________ ___ _ _ Satisfactory_ ______ ____ ____ Preparation Implementation Compliance with covenants Operation E. Assessment of Outcome Highly Satisfactory Unsatisfactory Satisfactory If  16 Table 2: Other Bank Loans/Credits i ? - -E; i - R X X X : i:: :Y~~eariot:: : : Loan/Credit Objective Appi roval Status Parallel Operations * Credit 1941-MAG To strengthen procedures relating to the 1988 Closing date: Public Sector Adjustment Project budget and preparation of public capital 1993 investment; reform public services, streamline the public enterprise sector; liberalize and reform the banking system, * Credit 2251-MAG To support the Borrower in the execution of 1991 In progress Health Sector Improvement the Health Sector Program in order to Project reduce mortality, morbidity and fertility levels, increase the efficiency of public health service delivery, and improve the responsiveness of the health sector policy framework to the needs and conditions prevailing in Madagascar. * Credit 2459-MAG To help rural groups to develop into 1993 In progress Rural Finance Technical savings and loan associations which, over Assistance Project time, may federate and make links with formal financial institutions. * Credit 2474-MAG To reduce food insecurity and malnutrition: 1993 In progress Food Security and Nutrition preparation and execution of subprojects, Project provision of short-term food transfers, and implementation of a community nutrition program and an Information, Education and Communication program. * Credit 2591-MAG To rehabilite infrastructure in Antananarivo 1994 In progress Antananarivo Urban Works and promote small and medium-sized Project entreprises in the areas of construction and engineering. Future Operation * Credit 2911-MAG To help the Government strengthen its 1996 Effective Public Management Institutional capacity for executing economic reforms Dec.18, 1996 Support Project and improving public administration.  17 Table 3. Project Timetable Stage of Project Cycle Planned Date Actual Date Identification n.a. n.a. Preparation n.a. February 1988 Appraisal March 1988 April 5-19, 1988 Negotiation April 1988 October 6-15, 1988 Board approval May 1988 December 6, 1988 Signature n.a. December 15, 1988 Effectiveness February 1989 March 15, 1989 Midterm review Not planned Project completion December 31, 1993 June 30, 1996 Credit closing June 30, 1994 December 15, 1996* * Date of cancellation of undisbursed balance. Table 4: Disbursements: Planned and Actual (in thousands of US$) FY 1988 1989 1990 1991 1992 1993 1994 1995 1996 Planned (SAR) - 5,500 12,000 18,500 21,000 22,000 - Actual - 6,445 10,889 14,597 19,619 23,287 Actual/Planned - % % % 31% 49% - Date of last disbursement: December 5, 1996  18 Table 5: Performance Indicators The Staff Appraisal Report did not define performance indicators for monitoring1 |implementation.l Table 6: Key Indicators for Future Operation Perforrnance indicators have been identified under PAIGEP that will facilitate the monitoring of the proposed measures (strengthening of the Secretariat Technique de l'Ajustement, training, information campaign) with respect to the objectives they are expected to achieve (improved quality of technical reports, dissemination of information on economic development and policies within the Government, and internalization of the adjustment program).  19 Table 7: Studies Included in the Project Study Purpose Status Impact 1. Studies on the profile of poverty in Poverty reduction Studies made between July and Identification of new poverty indicators various regions of Madagascar December 1993 2. Survey of beneficiaries of the HIMO and Improvement of services Study completed in October Increased awareness of the importance of the PRP components of EMSAP 1995 lessons to be learned from experience 3. Preparation of national accounts for 1993, Improvements in government In progress To be fmalized under PAIGEP 1994 and 1995 finances 4. Preparation of annotated sector guides for Improvements in project Implementation: January 1996 Harmonization of accounting systems for all IDA- maintaining and monitoring accounts relating accounting and auditing fianced projects to projects financed by the World Bank 5. Draft plan for the establishment in Strengthening of the judicial Study completed in April 1996 School opened in December 1996 Madagascar of a National School for Judges system and Clerks (ENMG)  20 6. Study of the socioeconomic impact of AIDS control Study completed in April 1996 A plan for the dissemination of the study's AIDS in Madagascar findings has been prepared, but has not yet been implemented 7. Audit of support measures for structural Mitigation of the negative Completed in May 1996. The findings are currently being applied in the adjustment effects of structural adjustment health and education sectors. To be finalized under PAIGEP 8. Study of the impact of macroeconomic Poverty reduction Completed in June 1996 Enhanced understanding of the impact and sector policies on poor households in Madagascar 9. Study of spending and the structure of Poverty reduction Completed in June 1996 Enhanced understanding of the impact of taxation consumption vis-a-vis tax liability on household living standards 10. Survey on targeted food distribution Food security improvement Conducted in late 1990 Unknown 11. Study on development of irrigation Food security improvement Not carried out 12. Study on development of smallholder Food security improvement Not carried out livestock 13. Study on industrial sub-sector Industrial performance Not carried out development strategy improvement 14. Study on debt conversion Indebtedness reduction to Not carried out commercial banks 15. Study on small socially-oriented projects Poverty reduction Not carried out  21 Table 8a: Project Costs (in millions of US$) Planned (SAR) Actual Local Foreign Total Local Foreign Total Exchange Exchange Part Al: Malaria control 2.18 7.32 9.50 1.30 4.34 5.64 Part A2: Family planning 0.47 0.36 0.83 0.16 0.12 0.28 Part A3: Food security 1.00 1.50 2.50 1.19 1.79 2.98 Part A5: Job creation in 4.05 2.48 6.53 8.13 4.99 13.12 targeted areas Part A6: Coordination of 0.05 0.15 0.20 0.08 0.26 0.34 NGOs Part A7: Employee redeployment program 6.65 0.84 7.49 5.13 0.64 5.77 Part B2: Permanent household 1.01 1.10 2.11 0.98 1.07 2.05 survey _ C Part C I: Budget reform 1.94 6.53 8.47 0.48 1.62 2.10 Part C2: Government divestiture and privatization 0.86 1.60 2.46 0.46 0.85 1.31 PartC3: Studyfund 0.47 0.40 0.87 3.18 2.71 5.89 TOTAL 18.68 22.28 40.96 21.09 18.39 39.48  22 Table 8b: Project Financing (in millions of US$) Planned ActualC WSourc Loeal$Sti-f>00 i;0if Forcign;f Tot-al ; Local Foreign Total Ehsge Excange IDA 11.01 10.99 22.00 11.63 11.61 23.24' Government 4.60 - 4.60 4.60 - 4.60 ADB 3.07 0.93 4.00 - - 2 Swiss - 4.75 4.75 - 4.75 4.75 Cooperation UNDP 3.80 3.80 - 1.00 1.00 Other3 - 1.80 1,80 - 0.13 0.134 TOTAL 18.68 22.27 40.95 16.23 17.49 33.72 1 IDA disbursements were larger than planned because of SDR/US$ fluctuations. 2 The ADB contribution (partial financing of budget reforms and economic studies) was canceled and removed from the PIP in 1994. 3 Including UNICEF (US$0.3 million), WHO (US$0.1 million), France (US$0.7 million), Italy (US$0.5 million), Japan (US$0.2 million) 4 i.e. UNICEF; information on other cofinancing not available  23 Table 9: Costs and Economic Benefits Because no attempt was made at Appraisal to calculate a net present value (NPV) or an economic rate of return (ERR), there are no reference data on which to base a reestimation for the purposes of evaluation. Moreover, no parameters were provided from which cost- effectiveness could be calculated.  24 Table 10: Compliance with Legal Covenants Seti i ion oft 00 xSubject Compliance Date Date as Description UmarksO Credit Amnended 3.01 (a) Execution Yes Commitment to the objectives; carrying out the Project with due diligence and efficiency and in conformity with appropriate administrative, financial and engineering practices. 3.01 (b) Execution Yes Carrying out the Project in accordance with Schedule 4 to the Agreement. 3.02 Procurement Yes Procurement of goods, works and Except for one case of vehicle consultants' services govemed by purchases, the cost of which was the provisions of Schedule 3 to the reimbursed by the Government. Agreement. 4.01 (a) Accounts/Audits Yes Maintaining records and accounts No record was kept of cofinancing adequate to reflect the operations of the Project. 4.01 (b)(i) Accounts/Audits Yes Annual audit of records and No separate financial statements were accounts. prepared for FY89 & FY90. The FY91 audit covers these two periods, in addition to 1991.  25 Table 10: Compliance with Legal Covenants (continued) Seetion of Subject Complianee Date Date as Description Remarks Credit Amended Agreement 4.01 (b)(ii) Accounts/Audits Partial Furnishing to the Association, not later than six months after the end Only the 1993 report was forwarded on time of each year, a copy of the audit report. 4.01 (b)(iii) Accounts/Audits Yes Furnishing such other infornation concerning accounts and the audit thereof as the Association shall request. 4.01 (c)(i) Accounts/Audits Yes Maintaining records and accounts reflecting expenditures. 4.01 (c)(ii-iv) Accounts/Audits Yes Retaining accounting records until From January 1993, a quarterly audit of at least one year after the audit; statements of expenditure was introduced, enabling the Association to examine such records; ensuring that annual audits contain a separate opinion as to whether the statements of expenditure, together with the internal controls involved in their preparation, can be relied upon. Annex 4.3 Execution Yes Submitting an annual work program to the Association by August 31 each year. Annex 4.4 Execution Yes Each year, by June 30 at the latest, submitting to the Association a report on the previous year's activities.  26 Table 11: Compliance with Operational Manual Directives Dvirective Number andl Title Remarks 1. O.D. 13.05: Project Supervision (para. 4) Performance ratings were not recorded for 20 of the Bank's 27 supervision missions. Table 12- Bank Resources - Staff (weeks) StageofGtProjectt, Cle tlanned Amended Act al Weeks US$ Weeks US$ Weeks US$ (thousands) (thousands) (thousands) Up to appraisal (preparation - 28.3 70.5 and preappraisal) Appraisal - 60.8 139.1 Negotiation -+ Board - - 25.4 59.6 Supervision 36.0* 98.5* 41.9** 92.4** 231.0 550.9 Completion - - - 6.0 22.4 Total 36.0 98.5 41.9 92.4 351.5 842.5 * For FY95 and FY96. ** For FY95, FY96 and FY97.  27 Table 13: Bank Resources - Missions Performance Rating Stage of Project Month/ No. of No. of Specialties Status Development Type of Cycle year persons daysin (effetiveness) problem field Up to appraisal 04/88 11 15 CO,C,E Appraisal - 07-08/88 l t9 CO,C,E Board Supervision 02-03/89 6 21 CO,C,DC No rating No rating F,M Supervision 06/89 5 18 CO,C 2 1 M Supervision 10-11/89 5 37 E,PHS,DC No rating No rating Supervision 03/90 2 21 E,C No rating No rating Supervision 11/90 4 5 CO,S/D 2 2 M Supervision 02-03/91 2 7 ENG No rating No rating M Supervision 07/91 3 10 E,D No rating No rating M Supervision 02/92 4 Is E No rating No rating M Supervision 03/92 2 n.a. ENG No rating No rating - Supervision 06/92 1 n.a. FA No rating No rating M Supervision 07/92 1 S/D No rating No rating Supervision 09/92 3 21 E,C No rating No rating M Supervision 10/92 1 9 ENG No rating No rating F Supervision 11-12/92 2 21 C,S/D No rating No rating M Supervision 03/93 I 8 ENG No rating No rating - Supervision 05-06/93 1 10 PIS 2 2 - Supervision 06-07/93 2 12 OA No rating No rating - Supervision 09-10/93 2 18 S/D,C No rating No rating - Supervision 10/93 1 6 PHS No rating No rating - Supervision 11-12/93 3 8 PIS,S/D,E 1 2 - Supervision 03-04/94 1 15 S/D No rating No rating - Supervision 04/94 1 8 PIS 1 2 - Supervision 07/94 17 S/D No rating No rating -  28 Table 14: Bank Resources - Missions (continued) Performance Rating ~:Stage of ~Month/ NO. Of NO. of Specialties status Development Type of ProjectUCycle year persons days in (effectiveness) problem field Supervision 10- 1 8 S/D No rating No rating 11/94 Supervision 04/95 1 6 PIS HS HS Supervision 05/95 3 II FA,OA No rating No rating Supervision 03/96 2 6 PIS,DO HS HS Completion 10/96 1 18 C S S TYPES OF PROBLEM C CONSULTANT F = FINANCING CO = COUNTRY OFFICER S = STUDIES D = DOCTOR DC = DIVISION CHIEF M = MANAGEMENT DO = DISBURSEMENT OFFICER 0 = OVERALL E = ECONOMIST ENG = ENGINEER TA = TECHNICAL ASSISTANCE FA FINANCIAL ANALYST PERFORMANCE RATINGS: OA OPERATIONS ASSISTANT 00 OPERATIONS OFFICER PHS = PUBLIC HEALTH SPECIALIST I = NO PROBLEMS, OR MINOR PIS = PROJECT IMPLEMENTATION SPECIALIST 2 = MODERATE PROBLEMS 3 = MAJOR PROBLEMS; SOLUTION IN S/D = STATISTICIANIDEMOGRAPHER 4 = MAJOR PROBLEMS; NO SOLUTION IN (NONE IN THIS PROGRAM) HS = HIGHLY SATISFACTORY S = SATISFACTORY  APPENDIX A: Mission Aide-Memoire   R6publique de Madagascar Mission de Suivi du Projet PASAGE (Cr. 1967-MAG) du 11 au 16 mars 1996 1. Une mission de la Banque mondiale a supervise le projet PASAGE (Cr.1967 MAG) dans la semaine du II au 16 Mars 1996. La mission etait composee de M. Christian Rey, charge du projet et responsable du portefeuille des projets a la Mission Residente de la Banque mondiale a Antananarivo. Mine Michele Rajaobelina, charg6e des deboursements a la mission r6sidente, a particip- a la mission pour les aspects de verification des procedures comptables du projet. 2. Les principales conclusions de la mission sont les suivantes: (a) le projet sera cl6ture cormme convenu le 30 Juin 1996; (b) le management du projet est performant et la cellule ereee servira au projet d'Appui Institutionnel; (c) la finalisation d'un cadre juridique des ONGs depasse l'objectif initial du projet; (d) l'enquete aupres des beneficiaires initiee conjointement par la Banque et l'Emprunteur, sur les composantes HIMO et PRP, a permis de deceler des imperfections d'execution qui sont en cours de rectification, et perrettra une meilleure evaluation a posteriori de ces deux composantes; (e) les resultats de l'Enquete aupres des Menages ont 6te publies et sont en cours de discussion et de dissemination; et, (f) 1'enquete sur la seroprevalence du SIDA pour 1'ensemble des villes principales de Madagascar a jet6 les bases coherentes et necessaires a tout projet ulterieur dans ce domaine. 3. Les activites demandant un suivi particulier sont les suivantes: (a) terminer les travaux HIMO en cours avant la date de cl6ture; (b) preparer un rapport d'execution du projet; et (c) finaliser la loi sur les ONGs et'la presenter a l'Assemblee Nationale lors de la session de Mai 1996. Situation des composantes ou volets d'activites: 4. Partie A5 -du projet:-Ttfavaux routiers H-IMO: La situation des travaux est la suivante: (a) DAOI: 161 kin, 142 kmn ont ete receptionnes, le reste est en cours de finition; (b) DAO2: 33 kin, les 33 km (plus 6 km supplementaires) ont ete realises et receptionnes; (c) DAO3: 191 kin, 124 km ont ete r6ceptionn6s et le reste est en cours de finition; (d) DAO4: 168 kin, 135 km ont ete r6ceptionn6s et le reste est en cours de finition; (e) DAOS: 163 kin; 63 km ont ete r6ceptionn6s et le reste est en cours de finition; (f) DAO6: 7km, 5 km en cours de reception; (g) DAO7: 56 kin, 13 kin ont ete receptionnes et 30 sont en cours de reception; (h) DAO8: 85 kin, 70 km ont ete receptionnes et le reste est en cours de reception; (h) DAO9 et 10: 37 km en cours de realisation. Un total de 902 km de routes aura ete rehabilite a la fin des travaux. L'enquete aupres des beneficiaires a permis de reveler des problemes qui sont en train d' tre resolus dans les contrats en cours, notarnment en ce qui conceme: (i) les delais de  paiement, (ii) le contr6le des quantites joumalieres de travaux demandees aux ouvriers, et (iii) la qualite technique des travaux. 5. Partie A6: Coordination des ONGs: le projet de loi portant statut des ONGs n'ayant pas ete soumis en 1995 a l'Assembl6e Nationale, une serie d'ateliers a ete organis6e par le projet pour le discuter en profondeur. Cette large concertation permettra d'amender le texte et de le proposer pour ratification a I'Assemblee Nationale lors de la prochaine session. Quatre ateliers ont ete planifies: administration centrale, bailleurs de fonds, ONGs intemnationales et ONGs nationa-W L- ^a r-L p ticiper aux trois premiers ateliers. L'atelier avec les ONGs nationales est prevu au debut du mois de Mai, afin d'integrer les cornmentaires issus des discussions entre l'USAID et les ONGs travaillant dans leurs projets. A cette occasion, une etroite collaboration s'est instaur6e entre 1'USAID, les ONGs et le projet finance par la Banque mondiale. Un large concensus s'est degage pour joindre nos efforts et obtenir un projet de loi arnende pour fin Mai afin de le transmettre a l'Assemblee Nationale. Une comrnission de lecture comportant une large majorite de representants des ONGs et des administrations concemees, sera chargee de finaliser le projet de loi. La Banque de son c6te fera participer une specialiste du siege pour la finalisation de la loi et expliquer la strategie de la Banque vis-a-vis des ONGs. 6. Partie A7: Programme de'Reinsertion Professionnelle: le programme continue son activite aupres de la Regie Nationale'des Chemins de Fer Malgache (RNCFM), de la societe Sarnangoky et Betampona pour un total de 503 personnes en cours de traitement. Sur un total de 6093 personnes eligibles, 5098 ont ete effectivement traitees. Une population de 800 personnes a traiter pour la RNCFM et une partie du personnel du port de Toamasina ne pourra etre traite que si un financement complementaire, au dela de Juin 1996, sera assure. La Banque mondiale a entame des discussions avec les responsables d'un fond suedois pour tenter d'assurer ce frnancement. Compte tenu des resultats de l'enquete aupres des beneficiaires, 1'equipe a ete renforcee et la rapidite de traitement des dossiers s'est amelioree. Les recommendations de l'enquete sont egalement prises en compte pour ameliorer la qualite des relations, dotations et formations. 7. Partie B2: Enquete aupres des menages (EPM): le rapport final de l'enquete a ete finalise et publie fin Janvier 1996. Les seminaires d'analyse des donnees et de dissemination des resultats de 1'enquete ont demarre et s'6taleront jusqu'a fin Mai 1996. Un premier atelier a ete organ.ise en F6vrier demier sur les themes de l'emploi et du secteur infornel. La mission regrette que le sp6cialiste en donnees sociales n'ait pu etre recrute pour aider a l'interpretation des resultats de l'enquete dans ces secteurs. Cependant, une specialiste en statistique de la Banque mondiale assistera l'organisation de l'atelier sur les femmes organise debut Avril prochain. Un demier atelier a ete programme fin Mai sur le profil de la consommation et le calcul d'indice des prix. Les resultats de cette enquete ont ete tres utiles pour finaliser le Rapport sur la Pauvrete a Madagascar dont un atelier de discussion est prevu en Juin 1996 a Antananarivo.  8. Partie Cl: Reforrne Budgetaire: le consultant national recrute sur cette composante a vu son contrat renouvelle jusqu'a fin Juin 1996, date de la fin du projet. Ce volet sera poursuivi dans le cadre du Projet d'Appui Institutionnel a la Prograrmnation et a la Gestion des Depenses Publiques. 9. Partie C2 (i) et (ii): Privatisation des Entreprises et DGGP: la CIP (Commission Independante de Privatisation) qui avait ete mise en place a la fin de la DGGP, a e1abore et finalise le projet de loi sur les privatisations. Le projet a particip6 au financement des activites de la CIP, ce qui a facilite les travaux de cette derniere. Ce projet de loi fait partie des mesures a mettre en place, dans le cadre des discussions en vue du financement par la Banque mondiale d'un credit d'ajustement structurel. 11 est pret pour etre presente au Gouvernement, pour approbation. 10. Partie C3: Fond d'etudes: le fond d'etudes s'est av6re au fil des mois un outil indispensable pour le portefeuille des projets a Madagascar. En effet, plusieurs etudes ont pu etre engagees, et en particulier l'etude sur la prevalence du SIDA. Celle-ci permettra d'avoir une bas- sr'information _ohide s:- !aq 1l le Gouvernement et les bailleurs de fonds pourront se baser pour la preparation d'activites dans ce secteur. L'excellent travail realise par les consultants du FUTURES Group et les homologues nationaux a permis de mener a bien des enquetes de seroprevalence dans toutes les villes importantes de Madagascar (Tui6ar, Majunga, Tamatave, Antsiranana, Fianarantsoa et Antananarivo) et d'equiper le laboratoire central de r6f6rence situe a Antanananivo. D'autre part, une publication dans la revue scientifique Lancet (annexe 1) a donne l'occasion a 1'equipe malgache de publier au riveau mondial. Sur cette base, le projet financera la participation d'une 6quipe malgache a la prochaine Conference Intemationale sur le SIDA qui se deroulera a Vancouver en Juin 1996. Coordination Gen6rale du 2rojet. Evaluatian !i. Management du projet: Compte tenu de la continuite des activites de la cellule dans le cadre du projet d'Appui institutionnel, la mission a discute les ameliorations a apporter a l'organisation de la cellule de projet. En particulier il est important que la cellule complete son equipement inforrmatique avec: trois ordinateurs de bureau avec microprocesseur Pentium et un ordinateur portable suppl6mentaires et les versions recentes des logiciels utilises. En particulier, la personne chargee de la planification des activites et des passations de marche doit posseder un logiciel de planification de projet type Microsoft Project. 12. Finances, Audits, . Une situation financiere du projet au 15 Mars 1996 est annex6e a l'aide-memoire (annexe 2). La situation des decaissements au 15 mars 1996 est de 86,5 pour cent. Une prevision de depense pour les trois derniers mois du projet est egalement annexee. It est previsible que le projet sera cloture au 30 juin 1996 avec une balance positive de 0,8 million de USD environ qui devra etre annulee. La mission a v6rifi6 par sondage les depenses dont la documentation est retenue au niveau du projet et a pu constater que toutes les pieces justificatives etaient presentes. Les audits sont faits  sur une base trimestrielle et ['audit annuel pour l'annee 1994 a ete remis avant le 30 Juin 1995. 13. Date de Cl6ture, Rapport de Fin de Projet: la date de cl6ture du projet a ete arrete au 30 juin 1996. Le projet PAIGEP qui devrait etre negocie en mai 1996 et entrer en vigueur en octobre 1996 continuera, entre autres, le renforcement administratif entame a travers le projet PASAGE. Comme il l'a ete mentionne dans le precedent aide-memoire, la cellule de coordination sera conservee pour assurer un demarrage efficace de ce projet, ai partir d'une equipe en place deja rodee et connaissant parfaitement les procedures de la Banque et malgaches. Un rapport de fin de projet sera elabore conjointement par la partie malgache et la Banque. A cette fin, la partie malgache preparera sa propre evaluation du projet sur: execution, coats et benefices, performance de la Banque et de la partie malgache en fonction des obligations contractuelles respectives telles que decrites dans l'Accord de Credit. Cette evaluation sera annexee a l'evaluation faite par la Banque de son c6te, lors d'une mission d'achevement du projet qui se tiendra en juillet 1996. 14. Enquete aupres des beneficiaires: Les rapports de l'enquete aupres des beneficiaires ont ete transmis au projet fin 1995. Les principales reconmmendations pour les travaux HIMO sont: (i) faciliter la comprehension des dossiers par les petites entreprises; (ii) encourager la participation de la main-d'oeuvre locale dans les travaux; Ciii) ameliorer les conditions de travail des ouvriers et leur paiement; et, (iv) arneliorer la qualite technique des travaux. Pour le PRP, les recommendations sont: (i) amrliorer les contacts entre la cellule PRP et les personnes traitees; (ii) ameliorer les formations; et, (iii) arneliorer la qualit6 des dotations; Certaines de ces recommendations sont deja en cours d'execution dans les volets concemes. L'ensemble des le,ons tirees de cette etude sera utile pour le design de nouveaux projets. Fait a Antananarivo, le 16 Mars 1996. Christian Rey  APPENDIX B: Borrower's Project Evaluation   REPUBLIQUE DE MADAGASCAR RAPPORT DE FIN D'EXECUTION Novembre 1996 Projet d'Actions Sociales et d'Appui b la gestion Economique (1 967-MAG) PREFACE 1. Le present document constitue le rapport de fin d'execution du Projet d'Actions Sociales et d'Appui a la Gestion Economique(PASAGE) dont l'Accord de Credit a ete signe entre la Republique de Madagascar et l'Association Internationale de D6veloppement (IDA) en date du 15 D6cembre 1988. 2. Initialement, la date d'achevement du projet est fixe au 31 Decembre 1993., mais deux prorogations ont et accordees ce qui a renvoye la date de cloture au 30 Juin 1996. Un credit d'un montant de 17.1 millions de DTS a ete mis a la disposition du Projet PASAGE. 3. Ce rapport a e etabli conjointement par les consultants M. RAJOELISON Henri Roger, Ingenieur en travaux Publics, et, Mr. RATSIMBAZAFY Eric, Economiste, avec la contribution de Mr. RAPELANORO-RABENJA, Economiste, Coordonnateur National du Projet PASAGE, et Mr. RATSIMBAZAFY Philibert, Responsable Administratif et des Marches Publics charge de l'Admnistration des programmes au Bureau National de Coordination du Projet. Ce rapport est base sur le rapport d'evaluation initial, I'Accord de Credit, les rapports des differentes agences d'execution, les enquetes et interviews entrepris par les consultants.  RESUME DE L'EVALUATION SITUATION MACRO-ECONOMIQUE 1. D'une superficie de plus de 587 000 kilometres carres, Madagascar a un environnement naturel diversifie. L'economie de production est constituee par trois secteurs d'activites classiques: le primaire, pour 39% environ du PIB et employant plus de 85% de la population active., le secondaire pour 11% et le tertiaire pour 50%. Avec une population de plus de 12 millions d'habitants, ayant un accroissement annuel de pres de 3% et un revenu per capita de US$250. Madagascar fait partie des pays les plus pauvres du monde. Cette situation resulte de la mise en oeuvre d'une politique economique inappropriee depuis les annees 1970 avec des nationalisations massives, un important secteur public, un contr6le excessif des activites du secteur prive. 2. Depuis les annees 1980, Madagascar, avec l'aide du F.M.I., a mis en oeuvre des mesures drastiques pour tenter de resorber les desequilibres aussi bien externe qu'interne. Le deficit budgetaire est passe de 15% A 4% du PIB de 1981 a 1986, le taux d'inflation passe de 30% A 13% sur la meme periode. Bien que le PIB accuse des taux positifs ceux-ci se trouvent en de,A du taux d'accroissement de la population, sauf pour les annees 1989 et 1990 oui ces taux sont respectivement de 4,1% et 3,1%. Cette tendance positive a ete annihilee par les evenements politiques de 1991, oui une baisse de (-)6,4% a et enregistree pour stagner autour de 1% les autres annees. Actuellement, Madagascar est tombe dans un marasme economique intense, le phenomene de pauperisation est present au sein de la societe et s'amplifie d'annee en annee. 3. Les ajustements structurels entrepris dans chaque secteur de l'6conomie mettent plusieurs annees pour etre implantes et avoir les effets escomptes, entre temps la situation des groupes vulnerables continuent A pericliter. Des mesures s'imposent donc pour aider ces categories de gens. II est indeniable que seule une augmentation substantielle du PIB reel par tete serait la solution pour sortir les malgaches de la pauvrete, augmentation qui dependra du succes qu'aurait les programmes d'ajustement du Gouvemement. Ces reformes requierent des changements au niveau des instruments de gestion macro-economique, y compris le systeme de programmation des depenses publiques, la gestion des investissements au niveau des societes d'Etat et la restructuration du secteur financier. Au vu de ces besoins, le Gouvemement decida de preparer un programme pour soutenir le processus d'ajustement en adoptant des politiques sociales transitoires et en renforcant ces capacites institutionnelles pour etre en mesure de mener a bien ces trains de reformes. De lA est ne le Projet d'Actions Sociales et d'Appui A la Gestion Economique (PASAGE). IDENTIFICATION DES GROUPES VULNERABLES 4. Le Gouvernement et l'IDA avec la cooperation d'autres organismes intemationaux ont etudie l'evolution du secteur social, particulierement l'impact de la politique economique sur la population, la sante, la securite alimentaire et l'emploi. Ces etudes ont permis d'identifier les groupes les plus touches. 5. En matiere de sanX, 2,5 millions de personnes sont atteints du paludisme, premiere cause de morbidite a Madagascar. Les causes de la recrudescence du paludisme sont complexes et inclus le probleme d'acces de la population aux medicaments (prix et distribution) l'insuffisance des informations concemant la maladie et son traitement, et l'abandon de la pulverisation periodique d'insecticide. 6. En matiere de sdcuritd alimentaire, plus de 11 000 personnes (enfants abandonnes, handicapes...) sont totalement depourvus. Malgre les succes de la liberalisation du riz, des poches de malnutrition subsistent toujours. A cela s'ajoutent les familles du Sud de Madagascar qui souffrent de secheresse chronique.  7. Pres de 7 000 employvs du secteur public seraient au chomage suite au train de reformes. Des formations et des stages de reconversion ainsi qu'une assistance sur le plan materiel leur sont necessaires pour leur reinsertion professionnelle. 8. En sus de ce qui a ete dit plus haut, notons que le taux d'accroissement de la population de 3% est un serieux handicap pour un relevement rapide du revenu par tete. LES OBJECTIFS DU PROJET 9. Les objectifs du projet: (i) d'entreprendre un programme d'actions d'urgence pour les groupes defavorises, (ii) de renforcer l'aptitude du Gouvemement a suivre les conditions sociales et a elaborer les politiques et programmes sociaux appropries, (iii) de faciliter l'ex6cution du programme d'ajustement en renfoncant les institutions responsables pour sa mise en oeuvre. 10. Pour la realisation de ces objectifs, le projet comprend trois parties: (i). le programme d'action sociale prioritaire qui comprend: a) un programme d'urgence de lutte contre le paludisme, b) I'amelioration et l'expansion des programmes et services de planning familial; c) les operations pilotes pour ameliorer la securite alimentaire; d) la rehabilitation de routes selon des techniques a haute intensite de main d'oeuvre; e) I'appui au Minist&e de la Population pour la coordination et l'information des ONGs; f) le programme de redeploiement pour les salaries du secteur des entreprises publiques ayant perdu leur emploi a la suite de la rationalisation du secteur; (ii) les actions liees a la dimension sociale de l'ajustement qui sont compos6es de: a) la creation d'une cellule d'analyses a la Direction Generale du Plan pour appuyer les differents minist&res dans la conception et le suivi des programmes sociaux; b) la realisation d'une enquete permanente sur les menages afin de mesurer leurs conditions de vie; d'identifier les groupes cibles necessitant des interventions et evaluer les effets de ces dernieres; (iii) I'appui a la gestion dconomique dans le but de faciliter la realisation des programmes d'ajustement en finan,ant des etudes, des formations, I'assistance technique et les supports logistiques relatifs a : a) la revision des procddures budgetaires, y compris, la preparation de strategies sectorielles, de programmes d'investissements publics triennaux glissant et de programmes des ddpenses publiques; b) la reforme des entreprises publiques; c) la mise en place d'un fonds d'etudes pour la preparation , I'analyse et la supervision de programmes et projets visant a l'aamelioration de la base de donnees economiques et sociales, a l'execution de la politique d'ajustement economique, au ddveloppement de politiques sociales et a la croissance economique. 11. L'accord du credit PASAGE (1967-MAG) a ete signe entre la Republique de Madagascar et l'Association Internationale de Developpement (IDA) en date du 15 D6cembre 1988. Initialement, la date de l'achevement du projet est fixee au 31 Decembre 1993, mais deux prorogations ont e accordees ce qui a renvoye la date de cl6ture au 30 Juin 1996. Un credit d'un montant de 17,1 millions de DTS a e mis a la disposition du projet PASAGE. Les ministeres, departements et institutions ci-apres sont charges initialement de l'execution des differentes parties du Projet: - Ministere de la Sante: Partie A. I - Ministere de l'Agriculture: Parties A.3 et A.4 - Ministeres des Travaux Publics: Partie A.5 - Ministere charge de la Population: Parties A.2 et A.6 - Ministere charge du Travail: Partie A.7 - Ministere charge des Finances: Partie C. I - Primature: Partie C.2  - Direction Generale du Plan: Parties B.l et C.3 - Banque de Donnee de I'Etat: Partie B.2 EVALUATION DE L'EXECUTION TECHNIQUE ET FINANCIERE 12. Pour le volet Sante, les objectifs du projet ainsi que les moyens a mettre en oeuvre sont clairement definis et r6pondent aux priorites du Gouvernement qui veut eradiquer au plus vite F'epidemie de paludisme. Ainsi, I'achat de 300 000 boites de 1000 comprimes de chloroquine a ete entrepris sur fonds Suisse, tandis que le projet supporta l'achat de 45 tonnes de DDT., I'acquisition de materiel de pulverisation au nombre de 500, de materiel bureautique, de 10 camionnettes tout terrain et de 14 motocyclettes. Le recrutement et la formation des agents benevoles parmi la population a ete entrepris pour la distribution des medicaments et pour informer la population sur 1'evolution de la maladie et les formes de lutte contre celle-ci. Le recrutement d'un expert pour diriger les campagnes de pulverisation et d'agents pulverisateurs a ete entrepris. 13. Le resultat de la campagne de lutte anti-paludique a e probant, les cas de maladie ont sensiblement diminue apres seulement deux a trois annees d'effort, baissant ainsi les taux de mortalite et de morbidite. Grosso modo, les objectifs ont et atteints. Le point fort du programme a et6 cette implication de la population dans la lutte contre la maladie par le recrutement des agents au niveau meme des villages ce qui permet un acces plus facile aux medicaments et une facile diffusion des messages. Pour une allocation de 540.000 DTS, le montant decaiss6 s'eleve a 418.855 DTS soit un taux de decaissement de 77.6%. 14. Le volet azriculture conceme la mise en place de l'operation pilote pour la securite alimentaire par la creation des banques de cereales, I'etablissement d'associations d'epargnants ruraux et petits elevages avicoles en milieu urbain pauvre, la commercialisation d'aliments subventionnes, l'intervention nutritionnelle en faveur des enfants d'age prescolaire, la promotion de nouvelles possibilites de cultures, l'etude sur le developpement de l'irrigation. Certaines realisations ont eu les impacts voulus comme la creation des banques de cereales, l'appui semencier dans le Sud de Madagascar (85 tonnes de haricots et 42 tonnes de mais). D'autres ont moins reussi comme l'etablissement d'associations d'epargnants ruraux , I'aviculture en milieu urbain pauvre, l'intervention nutritionnelle en faveur des enfants d'age prescolaire, les cantines populaires. Certaines composantes de ce volet n'ont pu etre realisees comme la promotion de nouvelles possibilites de culture, la promotion de la fabrication d'aliments nutritionnels, des etudes sur le developpement de l'irrigation et sur la promotion des petits eleveurs, 1'enquete sur la distribution ciblee de produits alimentaires. Pour une allocation de 1.170.000 DTS, le montant decaisse est de l'ordre de 1.153.139, soit un taux de 98,6%. 15. Concernant le volet HIMO, les objectifs de rehabiliter 700km de pistes rurales, la formation des P.M.E. dans le domaine des travaux publics et gestion des entreprises et la creation d'emplois temporaires ont et largement atteints puisque 902 km de routes ont 6te r6habilites. 1 545 900H/j d'emplois temporaires ont ete crees, 189 P.M.E. ont et form6es et ont realise ces 902 kilometres. Ce volet HIMO a permis aussi la rehabilitation d'infrastructures de base detruites par les cyclones dont 16 a Antananarivo, 7 A Fianarantsoa, 6 a Toamasina. Le projet a aussi finane6, a partir de ce volet, un projet PNUD/FAO/MAG./88/014 concemant l'insertion professionnelle sur des terres nouvelles de quelques 900 Ha de 114 Jeunes entrepreneurs. D'une maniere generale, le volet HIMO a eu des impacts positifs, d'abord sur la qualite des travaux qui sont nettement superieurs par rapport aux autres de memes contenances, sur le desenclavement des zones isolees, sur la creation d'emplois temporaires et de distribution de revenu (3,5 milliards de FMG), sur la participation des collectivites d6centralisees dans l'identification et mise en oeuvre des pistes ainsi que sur le m6canisme d'entretien apres la rehabilitation, sur l'effet d'entrainement du projet HIMO, sur la formation des petites entreprises de travaux publics. Le montant alloue A ce volet est de 7.210.000 DTS, les decaissements s'el&ves a 5.760.365,88 DTS, soit un taux de 79,89%.  16. Le volet Coordination des ONGs a pour objectifs l'amelioration de la base de donnees sur les Organisations Non Gouvemementales operant a Madagascar et la creation et mise en fonctionnement d'un systeme de coordination et d'informations des ONGs. Ces objectifs ont ete atteints au vu des rdalisations qui concement la publication de manuel d'elaboration et gestion de projet (500 exemplaires), la publication de manuel de procedure de creation d'ONGs (100 exemplaires), la publication de bulletin de liaison trimestriel pour les ONGs, la mise A jour du repertoire des ONGs, l'elaboration de texte relatif aux lois sur les ONGs qui sera ratifie par l'Assemblee Nationale en Novembre 1996. Sur un montant de 175.000 DTS, les decaissements s'elevent A 164.888 DTS soit un taux de 93,9%. 17. Le volet Programme de Reinsertion Professionnelle (PRP) prevoit l'etablissement et la mise en oeuvre d'un fonds de redeploiement pour les 7000 salaries du secteur des entreprises publiques ayant perdu leur emploi par la rationalisation du secteur, la creation et la mise en service d'un centre charge d'offrir les services d'orientation, de placement d'information sur les possibilites de formation pour ces salaries, et la mise en oeuvre de programmes de formation pour les travailleurs cibles. Le programme a touche 22 entreprises publiques. Sur un public eligible de pres de 6393, 5125 salaries furent inscrits au programme, 3673 individu ont recu une formation technique, 4219 personnes ont re,u des dotations en materiel, I'auto-emploi realise est de 4219, tandis que l'emploi salarie ne concerne que 188 personnes. En ddfinitif, 26% de l'ensemble ont reussi A creer un auto-emploi remunerateur, le reste n'ont pas reussi A creer une activite remuneratrice durable. le transfert de competence du projet d'appui MAG 88/015 qui a forme les services d6centralises du Ministere de l'Emploi en matiere de reinsertion professionnelle a et effectif. Dans le processus de traitement de ces salaries, 36 differents Centres de formation repartis dans tout Madagascar (agricole, elevage...) ont travaille avec le PRP pour ameliorer la connaissance et le savoir-faire de ce public. La creation de la cellule de gestion autonome du PRP , rattache au BNCPP , a permis de regler positivement le probleme de rattachement institutionnel de cette composante. L'allocation de credit pour ce volet est de l'ordre de 2.270.000 DTS, le montant decaisse est de 2.593.637,23 DTS soit un taux de decaissement de 114,26%. 18 Le volet Enquete permanente aupres des menages (EPM) est une composante de la partie B: "Actions liees aux dimensions sociales de l'ajustement" du projet PASAGE. L'objectif etant de doter le Gouvernement d'une capacite autonome et permanente de collecte, de traitement et d'analyse statistique des donnees concernant le niveau et les conditions de vie des menages, permettant d'identifier les groupes-cibles qui necessitent des interventions et evaluer les effets de ces demieres, et d'observer le profil de la pauvrete. En matiere de realisation l'enqu8te sur terrain a ete terminee en Septembre 1994. Les activites d'apurement de la base des donnees de l'EPM ont ete executees et les donnees sont disponibles. Pour l'etude du panier de la menagere 1993, pour le calcul de l'indice des prix de detail A la consommation familiale A Antananarivo et les autres centres urbains les travaux ont ete confies au projet MADIO (DIAL/ORSTOM). En Novembre 1995, la Direction de l'EPM a proced6 a la mise en forme du Rapport principal de l'Enquete puis trois ateliers se sont succedds pour disseminer les resultats. Notons la participation au siege de la Banque A Washington, de deux techniciens malgaches (Directeur national et le Chef de Service traitement et analyse) de l'EPM pour la finalisation du rapport d'evaluation de la pauvrete a Madagascar et la preparation du seminaire national sur la pauvrete. Sur un montant alloue de 560.000 DTS, le montant decaisse est de 508.454 soit un taux de 90,8 %. 19 Le volet R6forme Budge taire a pour objectif l'obtention d'un outil de gestion fiable, efficace et exploitable sur le plan international et qui permet d'avoir le maximum d'informations sur la gestion financiere et budgetaire de l'etat. La nouvelle circulaire budgetaire, lan,ant la reforme budgetaire, a ete diffusee en 1992. L'ensemble des gestionnaires a ete forme aux nouvelles techniques de gestion en Novembre 1992. Des seances d'evaluation ont et organisees au cours de l'annee 1994 pour detecter les eventuelles defaillances, erreurs ou incomprehensions rencontrees par les utilisateurs et  pour redresser ces defaillances. Sur le plan organisation des services d'ordonnancement, l'ouverture de trois nouvelles circonscriptions financieres. La mise en application de la Reforme Budgetaire a necessite une revision du cadre reglementaire regissant les Finances Publiques. Le systeme est actuellement fonctionnel. II reste son application sur les Fonds de Contre valeur, les dons et aides, et la mise en place d'un tableau de bord devant permettre son exploitation rationnelle. Son extension sur les collectivites et les etablissement publics est envisagee. Le montant alloue A ce volet est de l'ordre de 1.600.000 DTS les decaissements s'61kvent a 1.153.673 DTS soit un taux de 72 %. 20 le volet Delegation Generale du Gouvemement A la Privatisation a pour objectif la rehabilitation et la restructuration des entreprises publiques. Une premiere campagne de privatisation a ete menee jusqu'en fin 1993, mais l'absence de transparence et de politique recherchant l'adh&sion du public a entache cette campagne. Sur les 90 entreprises publiques prevues, seulement 52 ont ete privatisees ou liquidees et 22 liquidations annoncees ne sont pas encore closes ou meme entamees A ce jour. Sur 42 milliards de FMG de produits attendus de la privatisation, 21 milliards de FMG restent A recouvrer aupres des debiteurs; 21 milliards de FMG ont et verses aux liquidateurs, sur lesquels 4 milliards ont e reverses au Tresor Public. L'insuffisance de fondement legal des operations de privatisation et les faiblesses du systeme institutionnel de mise en oeuvre n'ont pas permis de legitimer cette campagne. Les activites de la DGGP ont ete suspendues en Decembre 1993. La Commission Independante de Privatisation a pris le relais A partir de Novembre 1994., elle a pour mission de faire une revue des privatisations dejA realisees, des obstacles et des problemes rencontres, de proposer les structures et les methodes qui garantiraient A toutes les parties concemrs la plus grande transparence et Y'efficacit6 maximale dans le programme de privatisation que le gouvernement entend reprendre. Leurs travaux ont abouti sur des textes de loi relatifs A la privatisation que l'Assemblee Nationale a ratifie en Juin 1996. Le montant alloue A ce volet est de l'ordre de 755.000 DTS. Le montant decaisse s'eleve A 714.931 DTS soit un taux de 94,69 %. 21. Le volet Fonds d'Etudes concerne la creation et la mise en fonctionnement d'une cellule d'analyse a la Direction Generale du Plan pour appuyer les differents Ministeres dans la conception et le suivi des programmes sociaux, la preparation de strategies sectorielles, de programmes d'investissements publics triennaux glissants et de programmes de depenses publiques, I'appui A l'unite chargee de la mise en oeuvre du programme de depenses publiques et au service charge des deboursements au sein du Ministere charge des Finances, I'etude, I'analyse et la supervision des programmes et projet, et la formation. Les activites entreprise au niveau de ce volet pourrait &re classer en cinq categories: (i) les activites liees au fonctionnement meme du projet PASAGE; (ii) les travaux d'inventaire et d'audit realises pour le compte de divers institutions et organismes (BFV, inventaire du stock de vanille...) (iii) les etudes proprement dites, embrassant plusieurs domaines et secteurs d'activites; (iv) l'assistance technique et l'appui materiels pour le montage d'un programme d'investissements publics et de programmes des depenses publiques; (v) les activites de formation ou l'on distingue aussi bien les complements de formation acquis A l'exterieur que les programmes de formation dispenses localement. 22. Malgre les difficultes rencontre dans 1'execution du volet "Fonds d'etudes", des realisations aux impacts positifs indeniables ont ete accomplies: la rationalisation du programme des Investissements publics a ete effective; la programmation amelioree et le mecanisme de gestion et de suivi du programme plus performant, en outre la diffusion de nombreux manuels pedagogiques ont permis aux differents services de programmation des ministeres d'amnliorer la qualite de leur travail; par ailleurs, la confection des programmes de Depenses Publiques a permis l'organisation d'une gestion plus saine et plus rigoureuse des ressources publiques par la Direction Generale du Plan et la Direction du Budget ; le programme de formation et de perfectionnement a connu un succes dans le sens oui il a et concu et realise de facon minutieuse de maniere A ce que les connaissances acquises  puissent servir immediatement de base operationnelle aux travaux confies. Notons que 111 personnes ont re,u une formation A l'etranger et que leurs acquis ont grandement contribue a la realisation des objectifs du projet. D'une maniere generale, l'assistance technique a ete benefique au projet puisque le transfert de connaissance a e effectif, les nationaux ont progressivement pris la releve et continuent les activites du projet. Le montant de credit alloue au volet "Fonds d'Etudes est de l'ordre de 2.190.000 DTS, le total des montants d6caisses est de 3.267.148,15 DTS soit un taux de decaissement de' I'ordre de 149, 2 %; 23 Notons que des programmes prevus ont e partiellement ou totalement delaissees: -(i) la partie B 1 relative A la creation et A la mise en fonctionnement d'une cellule charge de la conception, de la coordination et du suivi des programmes sociaux A la Direction de la planification sociale dont les raisons de la non-realisation ne sont pas mentionnees; -(ii)le programme d'amdlioration des comptes nationaux a pris un retard considerable dans son demarrage compromettant ainsi son execution; -(iii)la privatisation de la BTM, malgre un contrat d'etude en cours de finalisation en 1992 n'a pas ete suivi de realisation; -(iv)de meme pour 1'etude relative A la liberalisation du transport aerien, les termes de reference du projet ont etd transmis A la Banque Mondiale pour avis depuis 1992. EVALUATION DE LA PROGRAMMATION ET DE LA STRUCTURE DE GESTION 24 Bien que l'evaluation initial du Projet a su cemer les differents problemes qui prevalent au niveau de la societe malgache et que les objectifs du projet sont claires et precis, la conception et la preparation du programme ont ete jugees moins satisfaisantes du fait de sa complexite, on denombre 9 agences d'execution, 35 composantes, 42 categories de depenses mais suites aux erreurs frequentes commises dans les imputations des depenses par categories celles-ci furent reduites a 28. Certains r6alisations sont decides en cours d'execution comme les dotations en materiels du volet PRP, la rehabilitation des infrastructures de base detruites par les cyclones, le financement des projets d'appui au PNUD , MAG/88/014 et MAG/88/015 sur l'insertion professionnelle sur des terres nouvelles et la formation des services decentralises du Ministere de l'emploi. 25 Initialement, la gestion du projet a ete confie au Directeur General du Plan, mais vu ses attributions habituelles et la complexite du projet, il n'a pu assurer pleinement la coordination des actions des differents agences d'execution. Apres une suspension de quelques mois (Janvier A Mai 1992), le Bureau National de Coordination du Projet PASAGE (BNCPP)fut cree, il assure la coordination des differents volets du Projet suivant les methodes administratives, financieres et techniques appropriees, ainsi que la mise en place du systeme de gestion prive du projet. La creation du BNCPP a entraine une nette amelioration de la gestion du projet aussi bien dans son execution physique que dans son rythme de decaissement. Des reunions periodiques ont ete tenues avec les differentes agences d'execution afin de mettre au point la coordination des actions A entreprendre et d'evaluer l'avancement du projet en gendral. Un systeme comptable informatise a etd mis en place' au BNCPP en 1993, mais ce systeme gagne A etre perfectionne. Un audit des comptes est faite chaque annee. Un audit trimestriel des etats certifies de toutes les depenses engagees dans le cadre du projet, appuie cet audit annuel. 26 Des le depart, le Projet s'annonce delicat et complexe du fait de sa vocation multisectorielle et sa diversite dans les actions et dans 1'espace . Mais parmi les facteurs qui ont affecte l'execution du projet, on peut mentionner , premierement, le contexte politique qui prevalait durant la phase de demarrage du projet. Des periodes de troubles, marqu6es par des mouvements de contestations populaires et de greves generales ont illustres I'annee 1991; une periode de transition s'en suivait de 1991 A 1993. Deuxiemement, la lenteur dans les procedures de passation de marche public. Troisiemement, la defaillance de certains ex6cutants comme ces quelques entrepreneurs en travaux  publics (volet HIMO) et ces fournisseurs de materiels (volet PRP). Quatriemement, le manque de vonlonte politique et de transparence pour le volet DGGP. Cinquiemement, I'application du flottement de la monnaie a apporte quelques difficult6s au niveau des partenaires du projet. Pour le volet HIMO, en particulier, des contraintes dans le mise oeuvre ont e enregistrees comme la dispersion des axes rehabilites engendrant des problmes de contr6le, l'insuffisance de formation des PME sur la methode HIMO, la difficulte dans la gestion des materiels ou engins face au nombre des PME et la disparite des travaux dans l'espace, les difficulte de recrutement de main d'oeuvre dans certaines regions, le probleme d'insuffisance de materiels et d'equipements des PME; pour le volet PRP, le marasme economique a affecte la rentabilite des micro-projets des publics trait6s en auto- emploi, la disparite dans l'espace des publics traites rend difficile le contact et le suivi de ces publics. 27 Les forces du Projet PASAGE sont de divers ordres. Premierement, les agences d'execution respectifs sont responsables des composantes du Projet qui leur sont attribuees, de l'identification des travaux a la realisation, ce qui facilite la mise en oeuvre, le contr6le et le suivi. Deuxemement, 1'existence d'antenne dans les localites decentralises facilite la mise en oeuvre du projet (Directions Regionales des Travaux Publics a Fianarantsoa et Toliara, cellules du PRP,. au niveau provincial). Troisiemement, la qualite des prestations du Coordonnateur National du Projet et de son equipe qui ont su faire face aux differentes contraintes et difficultes, des la creation du Bureau National de Coordination des changements notables ont ete enregistrees tant sur le plan organisationnel que technique, permettant le rattrapage des deux annees de retard. 28 D'une mani&re gen&ale, l'assistance technique a eu un impact positif puisque les nationaux ont progressivement pris la releve et continuent les activites du projet. Neanmoins quelques problmes meritent d'etre souleves. Premierement, certains experts se comportent comme des etres superieurs en terres conquises et souvent des frictions apparaissent. Deuxiemement, le systeme de remuneration des consultants nationaux en comparaison aux expatries est assez frustrant, a competence egale, I'ecart des remunerations est phenomenal pour ne pas dire honteux, ce n'est pas parce que le pays est pauvre et que les salaires y sont les plus bas du monde que des responsables de projet se permettent d'imposer des derisoires remunerations, d6motivant ainsi les competences nationales qui souvent abattent le gros du travail. RECOMMANDATIONS 29 Sur le plan structurel et organisationnel, la definition prealable des missions, la stabilite de la structure de l'unite de management, ainsi que l'organisation strict du projet lui meme sont indispensables pour une gestion saine et efficace. La formule Bureau National de coordination s'il existe plusieurs agences d'execution est assez positive. Le renforcement de la capacite de gestion des responsables de volets serait benefique au projet. 30 Sur le plan technique, en ce qui conceme le volet HIMO qui merite d'etre maintenu vu les impacts positifs qu'il a obtenu, l'integration de la demarche participative dans la conception et la mise en oeuvre des travaux pourrait resoudre bien de probleme socio-culturels et techniques, la capacite de gestion et de travail des PME gagne a etre ameliore, I'assistance aux collectivites locales pour l'entretien des pistes rehabilites doit etre renforcee. Pour le volet PRP, le partenariat avec les entreprises est a developper pour ameliorer la forrnation-emploi, la mise en reseau du PRP avec d'autres partenaires (autres projets, ONGs) est a renforcer 31 Les operations financees par d'autres organismes (PNUD, Cooperation Suisse, FAO...) devraient etre refletees dans les etats financiers du Projet meme si ces fonds ne sont pas geres directement par la Banque Mondiale. A l'avenir, des dispositions seront a prendre pour que les operations financees conjointement avec les autres organismes puissent &re comptabilisees par l'agence d'execution.  32 La mise en place d'un expert de la Banque mondiale responsable de l'execution des projets et residant A Madagascar a ete benefique au projet , bien de problemes ont ete resolus sur place sans se referer systematiquement au siege de la banque a Washington .Cette decentralisation est a recommandee pour les projets futurs . De plus, les seminaires thematiques organises par la Banque, dont la pertinences n'est plus A demontrer pour ameliorer la qualite des prestations, sont A renforcer. II en est de meme pour les revues de portefeuille qui impliquent les experts de la Banque, les responsables du projets, les agences d'executions , les ministeres et les collectivites decentralisees, ainsi que les ben6ficiaires et les ONGs.   IBRD 20035RI -12- ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~12' 2 - Antsiranana MADAGASCAR Pov*d roads Fovtes govoronrJes ' __ _AiI.aottr.r noods |N I l R a,d., eccwsib/le. e tof,e seiso. tOSY4Brq< h rbilobe No__ -p.rnon-.nt roads Hei..o | . 4 + Vshino,no Roiitoodt Abos A,"/#. soAoobohre - ~Rivers K /e-0res it rIe ' N I r ANANA 4 Airport vso, Ailroots f-fu- SJbv m Notiosol copitol ln - Chef-fiotv de feritelv n ho> . noD FoUonitoy borooritso cpi J Asot Antal'oh I iomsl , oy,i .sO ' _ _ In,ernotond.Sbol jnis X . 2) t < Mo rgonts.tro Mahola'nao* ' Pm, )I dK ' n 6 ~Berg. . Mondrirsoro r