Senegal - National Rural Infrastructure Project

Report No. PID7903 Project Name Senegal-National Rural Infrastructure (@) Project Project ID SNPE57996 Region Africa Sector Other Agriculture Borrower Government of Senegal Implementing Agency Ministry of Agriculture Contact: Ms. Lena Fall Date of PID preparation May 10, 1999 Project Appraisal Date September 13, 1999 Projected Board Date January 15, 2000 Country and Sector Background 1. The last four years have witnessed steady progress in the implementation of economic reforms in Senegal. Notwithstanding these achievements, a sizable unfinished agenda of reforms remains. Despite being one of Africa's most politically stable regimes, the country has been unable to attract appreciable levels of foreign direct investment. This has been attributed in part to cumbersome administrative and judicial procedures and an incomplete privatization process. 2. Senegal relies heavily on its rural sector: agriculture accounts for 20 percent of GDP and 60 percent of employment. In the past decade however, the country's agriculture has stagnated. This stagnation has been due in part to a limited and degrading natural resource base, as well as a low supply response to the CFA devaluation. These difficulties can been traced to key institutional and policy constraints, including limited access to basic infrastructure; continued state involvement in subsectors; poor quality farm support services; and a lack of empowerment of rural populations in planning, financing and managing local development. 3. The 1994 Poverty Assessment Study for Senegal highlights the severity of poverty in the country, with more than a third of the total population living under the poverty line. Moreover, poverty remains an essentially rural phenomenon, with an incidence of 449 for the rural population. High underemployment is prevalent in rural areas, fueling the rural out-migration of the younger generations. It is therefore clear that any poverty alleviation strategy in Senegal needs to squarely address the rural sector. 4. The Government's overall development strategy is articulated in the Ninth Economic and Social Development Plan adopted by the National Assembly in February 1997, following extensive consultations with various segments of the civil society. The Plan's over-arching objective is to reduce the incidence of poverty and create gainful employment opportunities for youth through a significantly higher growth rate, as well as through effective measures to promote social and human development.  5. A countrywide consultative process, undertaken as part of the preparation of the Country Assistance Strategy (CAS), confirmed that the priority needs of the rural population reflect the above-mentioned structural constraints. These needs centered around improved access roads, drinking water, health services and education. During the consultation process, the population also expressed a strong desire to participate in the decision- making for local development and a commitment to assume an increased share in the funding of local development plans. 6. As part of its rural development and poverty-reduction strategy, the Government, with the participation of the civil society, has drafted a Letter of Decentralized Rural Development Policy. This policy letter sets out its long-term strategy for promoting sustainable and equitable economic growth in the rural areas. The strategy focuses on strengthening local governments to assume full responsibility for the competencies devolved from the central government and promoting partnerships between the various actors involved in the participatory local development planning process. 7. Project Objectives: The National Rural Infrastructure Program (NRIP) will contribute to revitalizing the rural economy, reducing rural poverty and improving the living conditions of rural populations in Senegal. To this end, the NRIP will promote decentralized rural development and strengthen local governance through a twelve-year program, using the Adaptable Program Lending instrument. The Project is the first four-year phase of this program. The long-term vision is one of local communities (communautes rurales - CR) and their representative local governments planning and managing their own development programs and mobilizing the necessary resources through increased intergovernmental fiscal transfers and local revenue. To achieve these goals, the program will: (i) support the administrative and fiscal decentralization reform process; (ii) strengthen the capacity of rural communities and local governments to plan, prioritize, manage, and maintain community-based infrastructure; and (iii) provide funding for demand-driven and sustainably managed community-based rural infrastructure. 8. Project Costs and Financing: The total project cost would be US$46 million for the first four-year phase. With respect to sources of financing, in addition to the Government of Senegal and the project beneficiaries, two donors have already expressed an interest in the program: IFAD and IDA. It is probable that other donors, among those presently providing targeted support for decentralization and rural infrastructure, will step forward to help finance subsequent phases of the program. Program cost is estimated at about US$244 million. 9. Project Implementation: Overall implementation and coordination would be carried out by the Ministry of Agriculture, under which an independent Project Coordination Unit will be created. The project would be overseen by a Project Steering Committee, under the presidency of the Prime Minister. Responsibility for implementing individual components would remain with the respective institutions involved (i.e. local governments, Ministry in charge of Decentralization, Ministry of Agriculture). It is important to mention that while overall coordination of the operation will be the responsibility of central government, the execution of the community development plans will be decentralized and rely on the private sector or community work. Close coordination with other ministries will be essential to ensure coherence of sector programs and the NRIP, for example, with the Ministry of Education, -2 -  Ministry of Health, and Ministry of Public Works. 10. Project Sustainability: The sustainability of the project is critically dependent on the degree to which the beneficiaries identify with the initiative and on their ability to organize for operation and maintenance. The process at the CR level is entirely demand-driven and sustainability of rural infrastructure will be promoted by focusing only on those sub-projects that are priorities of the beneficiaries. Experience shows that sustainable local institutions are those that are organized around common interests and tangible benefits. The strong focus on capacity-building will increase the ability of the key actors to get organized to plan, manage and sustain local development efforts. The clarification of the roles and obligations of each party involved in local development will enhance the sustainability of the effort and will serve to improve the interface between decentralized services and civil society. 11. Lessons Learned from Past Operations in the Country/Sector: Experience gained in Senegal and elsewhere over the last two decades shows that, in order to succeed, rural development projects should (i) be designed, formulated and implemented by communities, based on their needs and resources; (ii) be relatively small and build on local social structures; (iii) have strong central political commitment;(iv) transfer resources to local governments; and (v) and ensure local accountability and ownership. The final project design will also reflect the lessons learned from the implementation of pilot operations in four CRs that are carried out as part of preparation activities. 12. Poverty Category P.A. 13. Environmental Aspects: It is expected that the small size infrastructures to be constructed under the program would not generate significant negative environmental effects. Guidelines would be prepared to cost effectively mitigate any possible negative environmental impacts. A procedural manual would include screening criteria to ensure that environmental considerations are taken into account in the selection of the rural infrastructure and the preparation of the community development plans. 14. Project Objective Categories: The program will contribute to poverty reduction objectives by improving access of local populations to basic infrastructure and services in an efficient and sustainable way. It will support decentralization efforts and provide institutional development at community and national levels. Contact Points: The InfoShop The World Bank 1818 H Street, N.W. Washington, D.C. 20433 Telephone: (202) 458-5454 Fax: (202) 522-1500 Susanne Holste Task Manager - 3 -  (202) 473-2128 Note: This is information on an evolving project. Certain activities and/or components may not be included in the final project. Processed by the Infoshop week ending October 22, 1999. - 4 -