World Bank Document · Document of The World Bank Report No: 25968 IMPLEMENTATION COMPLETION REPORT (TF-26044; COFN-04260) ON A LOAN/CREDIT/GRANT IN THE AMOUNT OF US$8 MILLION

Document of The World Bank

Report No: 25968

IMPLEMENTATION COMPLETION REPORT(TF-26044; COFN-04260)

ON A

LOAN/CREDIT/GRANT

IN THE AMOUNT OF US$8 MILLION

TO THE

WEST BANK AND GAZA

FOR

THE SECOND COMMUNITY DEVELOPMENT PROJECT

June 18, 2003

Water, Environment, Social and Rural GroupMiddle East and North Africa region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective June 2003)

Currency Unit = New Israeli Shekel 1NIS = US$ 0.22US$ 1 = 4.40

FISCAL YEARJanuary 1 to December 31

ABBREVIATIONS AND ACRONYMS

BIA Beneficiary Impact AssessmentCDP Community Development ProjectCDPII Second Community Development ProjectDORA Department of Refugee AffairsEEGP Emergency Employment Generation ProgramEIB European Investment BankEHRP Education and Health Rehabilitation ProjectICR Implementation Completion ReportIDA Internation Development BankICB International Competitive BiddingICDP Integrated Community Development ProjectIAs Implementing AgenciesLGU Local Development AssociationMOF Ministry of FinanceMOLG Ministry of Local GovernmentNCB National Competative BiddingNGO Non Government Organization OPEC Organization for Petroleum Exporting Countries O&M Operation and MaintenancePA Palestinian AuthorityPECDAR Palestinian Economic Council for Developemnt and ReconstructionPCD Project Concept DocuemntPDS Project Document SystemPLO Palestine Liberation OrganizationQAG Quality at EntrySWEMP Solid Waste and Environmental Management ProjectUNRWA United Nations Relief and Works AgencyWBG West Bank and Gaza

Vice President: Jean Louis SarbibCountry Manager/Director: Nigel Roberts

Sector Manager/Director: Letitia Obeng Task Team Leader/Task Manager: Kanthan Shankar

WEST BANK AND GAZASECOND COMMUNITY DEVELOPMENT PROJECT

CONTENTS

Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 24. Achievement of Objective and Outputs 35. Major Factors Affecting Implementation and Outcome 106. Sustainability 127. Bank and Borrower Performance 128. Lessons Learned 149. Partner Comments 1510. Additional Information 20Annex 1. Key Performance Indicators/Log Frame Matrix 24Annex 2. Project Costs and Financing 25Annex 3. Economic Costs and Benefits 27Annex 4. Bank Inputs 28Annex 5. Ratings for Achievement of Objectives/Outputs of Components 30Annex 6. Ratings of Bank and Borrower Performance 31Annex 7. List of Supporting Documents 32

Project ID: P058684 Project Name: GZ-COMMUNITY DEV. IITeam Leader: Kanthan Shankar TL Unit: MNSREICR Type: Core ICR Report Date: June 18, 2003

1. Project Data

Name: GZ-COMMUNITY DEV. II L/C/TF Number: TF-26044; COFN-04260Country/Department: WEST BANK AND GAZA Region: Middle East and North

Africa Region

Sector/subsector: Other social services (88%); Sub-national government administration (10%); Central government administration (2%)

Theme: Social risk coping (P); Civic engagement, participation and community driven development (P); Conflict prevention and post-conflict reconstruction (P); Social risk mitigation (P); Social risk reduction (P)

KEY DATESOriginal Revised/Actual

PCD: 09/21/1998 Effective: 04/30/1999 04/30/1999Appraisal: 01/25/1999 MTR: 02/02/2001 02/15/2001Approval: 03/10/1999 Closing: 10/31/2002 10/31/2002

Borrower/Implementing Agency: Palestinian Liberation Organization for the benefit of the Palestinian Authority/ Palestinian Economic Council for Development and Reconstruction (PECDAR)

Other Partners: Ministry of Local Government (MOLG), Department of Refugee Affairs (DORA)

STAFF Current At AppraisalVice President: Jean-Louis Sarbib Kemal DervisCountry Director: Nigel Roberts Joseph P. SabaSector Manager: Petros Aklilu Sonia HammamTeam Leader at ICR: Kanthan Shankar Kingsley O. RobothamICR Primary Author(s): Kanthan Shankar; Husam Abu

Dagga; Hisham Labadi

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: S

Sustainability: UN

Institutional Development Impact: SU

Bank Performance: S

Borrower Performance: HS

QAG (if available) ICRQuality at Entry: S S

Project at Risk at Any Time: Yes

3. Assessment of Development Objective and Design, and of Quality at Entry

3.1 Original Objective:The objective of the Second Community Development Project (CDP II) was to rehabilitate community infrastructure through labor-intensive microprojects, while improving their targeting towards poor and marginalized areas, including refugee camps. The objective responded to the need identified in the Palestinian Development Plan the 1999-2003 which called for investments into physical infrastructure targeted at social sectors. The objective also responded to the Bank's strategy for West Bank and Gaza which stressed the need for increased job opportunities through an equitable development process. Finally, the objective was based on lessons learned from it's successful predecessor, the first Community Development Project (CDP I).

3.2 Revised Objective:The project objectives were not revised.

3.3 Original Components:

Component: CostCivil Works – Infrastructure Improvements $13,500,000Technical Assistance – capacity building for LGUs/contractors $600,000Project Management Support $900,000Total $15,000,000

The project components were similar to CDP I with the main portion of funds (90%) targeted at labor intensive civil works. The large portion allocated to infrastructure rehabilitation was justified due to the great need that existed in villages and small municipalities for building their capital stock and creating local employment. The experience gained by the implementing agencies under the CDP I was also a justification for continuing with a tried and tested model in CDP II.

3.4 Revised Components:When the project became effective in late 1999, only US$8 million (IDA) of the total US$15 million project costs had been identified. Subsequently, the OPEC Fund and the EIB joined the program by providing parallel financing of US$8 million and 10 million Euro, respectively. With the onset of the Intifada, however, EIB suspended funding of its WBG programs. Nevertheless, some US$20 million of financing was disbursed towards the overall CDP II project – US$5 million over cofinancing estimates during project design. Consequently, the amount of funding available to the components changed with over 90% of the additional funding allocated towards civil works. The additional funding and focus towards physical work responded to needs for economic activities and employment generation in poor and marginalized communities.

3.5 Quality at Entry: The quality of entry is rated satisfactory. The project responded to a clearly identified need for infrastructure rehabilitation in poor and marginalized areas through a beneficiary assessment conducted on CDP I. Due to the replicative nature of the project, the preparation time from identification to Board was less than six months. Consequently, project preparation costs were less than US$50,000. The first batch of microprojects were identified, appraised and readied for

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implementation even before the project was declared effective. The successful completion of CDP II on schedule under the most trying conditions is evidence of the quality of project preparatory activities. CDP II was the first project in MNA to develop an Environmental Management Plan (EMP) for a community-driven development (CDD) project and since then, has been replicated in other similar programs. Finally, risks were realistically identified during preparation. For example, adequate budgets for Local Government Units (LGUs) for Operation and Maintenance (O&M) was rated high risk and has now turned out to one of the major issues affecting sustainability.

The project was subjected to QAGs “quality at entry” review and the nine categories for which it was reviewed, the ratings ranged from "satisfactory" to "highly satisfactory" with an overall “satisfactory” rating. The poverty focus, social aspects, and readiness for implementation earned the project a “highly satisfactory” rating. QAG ratings have been justified by the continued poverty focus, the adaptability of the design and completion of the project on schedule.

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective:The ICR concludes that CDPII has met its objectives satisfactorily. The basis for this conclusion can be explained through the following outcomes:a) improved access by poor communities to services through the rehabilitation/reconstruction of

community assets and basic infrastructure;b) responsiveness to community priorities;c) targeting of the poor and marginalized communities; andd) beneficiary satisfaction with project results and services.

It should also be noted that the project was adaptable to conditions of the Intifada and continued to be relevant during the socio-political unrest. The project had limited impact on employment creation and delays in implementing the technical assistance component reduced the institutional capacity building impact.

Infrastructure Rehabilitation and Protection of Community Assets: About 200 infrastructure projects – road rehabilitation, water and sanitation systems, school and classroom upgrading and construction – were completed, well above the initially envisioned 125 infrastructure microprojects. While the funding for subprojects increased due to parallel financing received from EIB and the OPEC Fund, the number of subprojects completed was still surpassed a proportional estimate of 168 subprojects. About one million people benefited through these projects. While internal road rehabilitation projects were important prior to the Intifada the rehabilitation/upgrading of access and link roads during the Intifada became even more critical and proved to be the only lifeline for inter-community travel and commerce.

Responsiveness to Community Needs: A beneficiary needs assessment was conducted as part of the conclusion of CDP I and while preparing the follow-on CDP II. When reviewing the projects by sector, it appears that for the most part the project responded to community needs, especially in meeting their desire for road projects. While roads were a high priority from the beginning, the Intifada increased this need. Education was the second highest priority and again

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this correlated with projects funded under CDP II. While water supply and sanitation is shown as a third priority, CDP II did not focus on this sector since other donors were already involved and licenses to dig wells were difficult to obtain. The response of CDP II to a project in Quttana highlights the responsiveness to community needs. The beneficiaries were very complimentary of the speed and efficiency shown by the Implementing Agencies (IAs) in rehabilitating the main water distribution lines serving the village which had been badly damaged during the conflict.

Sub-project Distribution Verses Community Priorities

0

10

20

30

40

50

60

Roads

Water

Waste

Water

Commun

ity Cen

ters

Health

Center

s

Educa

tion Fa

cilities

Electric

ity

Telep

hone

Others

Local communities priorities

Actual project distribution by Sector

Impact of Intifada Resulting in Changes in Local PrioritiesAccording to community surveys undertaken by the University of Geneva, local priorities changed during the Intifada. When respondents were asked what was important to them during the social and political turmoil, humanitarian aid, including food and employment generation, surpassed infrastructure rehabilitation as the top priority. Many of these requests were met through emergency programs. However, CDP II also observed a change in project priorities. Labor intensive works such as classroom construction in the West Bank and road rehabilitation in Gaza using locally manufactured interlocking tiles became the most requested projects.

Poverty Targeting: One of the lessons learned from CDP I was that systemized targeting is required to prioritize and meet the needs of the poorest communities. CDP II required the preparation of a poverty map for West Bank and Gaza. This was the first project in which the Bank aimed to prioritize interventions based on poverty. The poverty map was developed by the Palestinian Center Bureau of Statistics (PCBS) using public expenditure reviews conducted in 1997. The resulting poverty report and maps showed that the northern West Bank (Jenin and surrounding districts), southern West Bank (Hebron and surrounding areas) and the refugee camps had the greatest concentrations of poor people (defined as people earning less than US$2 per day). In Gaza, the refugee camps and the northern and southern areas were the poorest.

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Most of the locations of projects selected prior to the Intifada correlated well with the poverty map. However, the analysis and definition of ‘poor area’ was brought into question during the Intifada when unemployment rates in the Palestinian territories jumped from 20 percent to 60 percent. The poverty map prepared prior to the Intifada, therefore, lost some of its relevance.

Beneficiary Satisfaction with Services Provided: The response to CDP II during and following implementation has been uniformly positive, as illustrated through three beneficiary impact assessments and participatory workshops conducted during the life of the project. The table below provides a sample of benefits as described by communities.

Beneficiary FeedbackSector Perceived Benefits by Community Members

Roads • Easier access to clinics, schools and markets since unpaved roads are difficult to travel on during the wet winter months.

• Cleaner, paved streets benefit communities overall, though those living near once dusty streets benefit the most.

• Women’s access to primary health care centers and more distant clinics and hospitals has been facilitated.

• Travel for girls/women to schools/colleges/jobs has been eased and the number of women attending colleges and universities has increased.

• Ease of movement between villages increases social interaction. • Most important of all – inter-village roads provide alternate routes for travel during

the frequent closure and destruction of main access roads.Water and Sanitation

Running water reduces time spent collecting water and also increases personal lhygiene. Some people mentioned that children can now be bathed more frequently than the normal 7-10 day intervals.Women do not need to walk at night to collect water.lImproving the quality of well and spring water has reduced cross-contamination of lwater and will reduce waterborne diseases.There has been a reduction in uncontrolled disposal of sewage sludge from tankers ldue to the new sewer connections. Some sewage tanker drivers used to empty their loads in agricultural lots.

Multi-purpose Centers

Multi-purpose centers provide space for social services, especially health care and lkindergartens, in small villages.Centers provide a forum for local government units to conduct public meetings and lother community business.In Salfeet, the multi-purpose centers include services for handicapped people.l

Schools and Additional Classrooms

New facilities are healthier and conducive to studying.lLess crowded classrooms.lProvides a saving for the schools since they do not have to rent additional classrooms.lReduces the need for classes to be scheduled in shifts.lIncreases educational services and activities since libraries and game rooms are lincluded. Improves hygiene among school children by providing them access to separate and lrehabilitated restroom facilities. For example, at one school more than 700 students shared four restrooms while 35 teachers shared another.

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Relevance of the Project Before and During the Intifada: CDP II was one of the few Bank-funded projects that was able to absorb the shocks of the Intifada and continue to implement and maintain the relevance of the project’s original development objectives. The Intifada resulted in a flood of emergency employment generation schemes, including a series of Bank-funded projects. Nevertheless, due to the success of CDP II is implementation, the Bank viewed the project as one of its few medium-term development program and consequently, has financed a follow-up project called the Integrated Community Development Project (ICDP) based on a similar design.

4.2 Outputs by components:1. Infrastructure Improvements in poor communities: This output has been rated "highly satisfactory". About 200 microprojects were implemented against 125 planned during project appraisal.

Road rehabilitation comprised the majority share (52%) of microprojects funded through CDP II, even though the list of possible projects included social sector projects in health and education. Nearly 325 km of roads were rehabilitated and reconstructed under the project. There were many underlying reasons for this focus on road rehabilitation and the following provide a rationale for their selection for implementation:

• The health, education and power sectors are addressed at the national level through line ministries. However, there is no national road authority with dedicated funding, and this has a particularly negative impact on villages and small municipalities. In some cases roads have not been rehabilitated since the British mandate period over sixty years back.

• CDP II was the first Bank-financed project in WBG to fund activities in refugee camps. However, its interventions did not include projects in the health and education sectors, as these activities fell under the mandate of the United Nation Works and Relief Agency (UNWRA). CDP II projects, therefore, were selected to supplement UNWRA’s work, and road rehabilitation was often the obvious choice.

• While access to villages and small municipalities was challenging due to roadblocks even before the Intifada, it became increasingly difficult during the crisis. Most of the main roads have been blocked and the only way to move between villages and towns has been via village access roads which has led to a dramatic rise in community requests for such roads. As one Palestinian taxi driver said while driving on a CDP II-funded access road linking the villages of Abween and Aroura, “These link roads are like a divine intervention for us”. Eight villages and 20,000 people benefitted from this particular sub-project.

• In Gaza, road rehabilitation projects were often more labor intensive than those in the West Bank. Since asphalt was difficult to obtain from Israel, inter-locking tiles were used for road reconstruction. These tiles are manufactured locally, thus providing additional employment and income generation serving to dampen the impacts of WBG closure periods (in 2001 alone, Gaza was closed for more than 200 days).

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Developing Jouron Road - Jabalia Camp, Gaza (before and after)

School Rehabilitation Projects accounted for 25 percent of all CDP II-funded projects. Though most school and classroom building took place in the West Bank, this complemented UNWRA’s funding of all schools in refugee camps in Gaza. Furthermore, other Bank funded projects such as the Emergency Health Rehabilitation Project (EHRP), funded many schools both in Gaza and the West Bank. Also, in the West Bank, village councils played a more prominent role than the line ministry in providing educational facilities, and the limited budget available from the central government thus resulted in frequent requests for funding of school rehabilitation projects. In the West Bank alone, more than 235 classrooms were constructed.

Co-educational school in Khirbet Barta’a – Jenin area

The water and sanitation sector comprised 8 percent of the projects implemented through CDP II. Donor and other Bank programs in the water sector and difficulties in obtaining permits for digging wells resulted in requests for projects that focussed on upgrading water distribution and sewage networks. Approximately 10 kilometers of water lines and 23 kilometers of sewage lines were rehabilitated through the project. Beneficiary surveys have shown that these projects have contributed significantly to improved environmental conditions and human health, particularly in the densely populated areas of Gaza where waterborne diseases are the main cause of mortality and morbidity among children under five years of age. Furthermore, road projects, particularly in Gaza, have water supply and sanitation components as part of an overall neighborhood development program. Feedback from men and women at the Al Shaaf area in Gaza "Establishing sewage lines in our community made fundamental changes to our daily life. Our

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houses are cleaner, children can play safely in the streets, our household expenditures decreased due reduced expenditures for cleaning septic tanks".

Two health sector projects were implemented in the West Bank in Ramallah and Deir Razeh village. The reason for the relatively low requests for health centers was partly due to such requests being addressed through UNWRA in all refugee camps. Furthermore, the Bank and donors have addressed this sector through other programs such as the EHRP and other Emergency health projects. Additionally, as a condition of project selection, communities needed to obtain commitment from the Ministry of Health to staff and equip the centers and this was difficult to obtain due to the dire financial situation of most ministries. Finally, clinics and hospitals in the West Bank and Gaza tend to be funded by bilateral donors and NGOs such as CARE and Save the Children and as such, communities did not seek funding from CDP II. Nevertheless, it should be noted that few of the multi-purpose centers constructed through CDP II provided basic health services.

2. Employment Generation: This output is rated "satisfactory". While CDP II generated over 250,000 person days of employment, the average employment created over the life of the project was 20 percent, less than the original estimate of 25 percent. Considering that one of the project’s objectives was employment generation through labor intensive sub-projects, the implementation of a large number of non-labor-intensive road projects pushed down employment generation averages. It should be noted that prior to Intifada, most roads were rehabilitated with heavy equipment. During the Intifada, however, more labor intensive interlocking tile road projects were implemented in Gaza. Nevertheless, CDP II had limited impact on employment creation.

Employment Generated by Project Type

0 5 10 15 20 25 30 35 40 45

Public buildings

Schools and clinics

Retaining walls

Roads

Roads including Sewage

Roads including sidewalks

Waste Water

% of employment generation

3. Capacity Building : This output is rated "satisfactory" (Please refer to section 4.5)

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4. Increase in Economic Activity: This output is rated "satisfactory". While the Intifada and the resulting impact of closures devastated the Palestinian economy, CDP II projects were one of the few interventions that brought much needed relief to small villages and municipalities. While the economic impact was not significant, it generated local employment and assisted suppliers.

Other outputs achieved by the project are described below:5. Community Contribution to Project Costs: This output is rated "satisfactory". While the requirement for community contribution to project costs was a minimum of 10%, the dire economic situation during the Intifada made it very difficult for IAs to continue to require cash contributions. Nevertheless, it is remarkable that overall, the project was able to mobilize over USD1 million in counterpart contributions averaging about 6% for each project. Approximately 8% community contributions were recorded for IDA component and less for OPEC and EIB funded projects. As part of the Mid-term Review (MTR), due to the severe economic situation and high unemployment rates averaging 50%, mandatory contributions were suspended.

6. Impact on Gender: This output is rated "satisfactory". One of the main objectives of the project was to target the poor and marginalized. Beneficiary Impact Assessments (BIAs) in the past had revealed that women fall into the marginalized category. Hence, under CDP II, girls' schools in particular were targeted for rehabilitation and improvement. Nearly 40% of all schools rehabilitated under CDP II were girls and co-educational schools. Furthermore, even the economic infrastructure – mainly roads – benefitted women through greater access to health centers, improved hygiene conditions for their children and opportunities to participate in social activities through travel. Women and girls also benefitted through training programs – in particular programs on health and environment, motherhood and child care. The training facility for women constructed in Gaza also provided training programs in sewing and curtain design through the Ministry of Social Affairs.

4.3 Net Present Value/Economic rate of return:Since CDP II consists of small demand driven works, no detailed economic analysis could be taken ex-ante. However under CDP I, a cost effectiveness model was developed and used with the objective of establishing cost ratios as one of the criteria for project selection. One indicator which shows that projects were cost effective is the higher number of projects per unit cost (USD100,000 per project) as compared to estimates made during appraisal (USD 120,000 per project). Details of the model are provided in Annex 3.

4.4 Financial rate of return:Not applicable

4.5 Institutional development impact:The output is rated "satisfactory". The capacity built within PECDAR during the implementation of CDP I was consolidated under CDP II. In addition, the project built capacity within the other two partnering implementation agencies – Ministry of Local Government (MOLG) and Department of Refugee Affairs (DORA). In particular, DORA coordinated the submission of project proposals from refugee camps and also worked closely with UNWRA to prevent duplication of requests. In the CDP I, one of the shortcomings identified was the lack of cooperation between PECDAR and the line ministries. CDP II provided the opportunity for

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PECDAR, MOLG and DORA to work together to implement the program. The project provided the three agencies the opportunity to solidify their cooperation through an implementation agreement and responsibility matrix. The restrictions in movement made regular meetings among the implementing agencies challenging. In this regard, the installation of internet facilities to DORA through the project has been of major assistance. The project, for the first time, provided opportunities for the Local Government Units (LGUs), in particular village councils and camp services committees to assess their needs, develop proposals, seek funding and implement projects. The restrictions in movement and closures during the Intifada enhanced the role of the local government units. Projects were implemented using simplified procurement procedures including direct contracting implemented directly through LGUs. While these projects built the capacity of the LGUs, they also assisted suppliers and were a source of local employment.

While the capacity building program through training workshops was considerably delayed, the achievement of PECDAR in providing a series of demand-driven training courses for LGUs was very impressive. There were 67 training workshops held in the West Bank and Gaza which benefited over 1160 participants. Due to movement restrictions, two regional training centers were established to conduct regular training courses. Local universities and consulting firms were contracted to provide training in project management, public administration, financial and procurement management and computer skills. Training programs also targeted gender and women - training courses ranged from mother and child care to sewing and curtain design.

5. Major Factors Affecting Implementation and Outcome

5.1 Factors outside the control of government or implementing agency:The start of the intifada in September 2000 is seen as the major factor impacting project implementation. Communities and implementing agencies adapted themselves rather quickly to the new environment, although, the following factors did impact on the project:

Reduction in Donor Financing: While approximately USD18 million of parallel financing was made available shortly after project effectiveness, EIB suspended funding of the project due to the Intifada after disbursing only USD3 million of the total loan amount of over USD10 million. Impact on Suppliers and Contractors: The frequent closures experienced from the start of the Intifada severely restricted movement of construction materials and labor. The resulting reduced inventories and cash flows had a disproportionate effect on small contractors, many of whom were unable to sustain their operations. Over 23 projects in Gaza were temporarily stopped due to contractors inability to fulfill their obligations and demanding compensation/price revisions from the implementing agencies. However, disputs were solved amicably through negotiations with the implementing agencies. Also, many small suppliers were forced out of business due to contractors inability to pay their bills and shortage of inventory during sustained periods of closure, particularly in Gaza which has only one entry point for the supply of materials.

Increase in Poverty Rates and Related Impacts: The dramatic increase in poverty rates from 20% to 60% during the Intifada made it difficult to enforce community contributions of 10% (ranging from USD5000 to USD15,000) as a prerequisite for project selection. Hence, community ownership through participation in project costs, a requirement institutionalized under

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CDP I, was likely to be impacted. Furthermore the high poverty rates also severely inhibited the ability of the communities to sustain their projects in the medium term.

Impact on Institutions: Restrictions on movement made organizing meetings between the three implementing agencies very difficult. For example: the project coordinator in MOLG was unable to leave or receive anyone in Nablus for four months due to closures. Hence the objective of strengthening the partnership between PECDAR, MOLG and DORA was to some extent compromised. However, on the positive side, the closures and difficulties in movement resulted in the IAs decentralizing decision making to the LGUs and thereby providing greater opportunity for village councils to implement projects using local labor and materials.

5.2 Factors generally subject to government control:Considering the socio-economic context under which most of the project was implemented, there was very little government control on the outcome of the project. Furthermore, movement restrictions within agencies resulted in the government/line ministries transferring responsibilities to LGUs. Nevertheless, the government, and in particular MOF should be given credit for continuing to service the loan and in some cases contributing on behalf of communities who had difficulties in meeting their financial obligation.

5.3 Factors generally subject to implementing agency control:The IAs could have been better planned and implemented the capacity building component earlier in the project to maximize institutional development impact. However, PECDAR did successfully launch a demand driven training program during the last eight months of the project. The IAs were initially slow to respond to contractor disputes due to price escalations and non-availability of materials due to the Intifada resulting in stoppage of 23 projects during early 2001. On the positive side, the IAs adapted well to the prevailing situation on the ground. PECDAR was able to use its local offices in the districts to conduct the supervision of the works and also used LGUs through direct contracting methods. PECDAR also rented houses close to its main offices so that staff could stay the whole week without worrying about the travel restrictions and closures. The financing of internet connections for DORA offices in Ramallah helped in keeping the three IAs connected.

5.4 Costs and financing:When CDPII was presented to the Board, the cost of the project was USD15 million, of which only USD8 million from the Bank had been identified. The success of the first CDP attracted parallel financing offers from both OPEC and EIB. Hence, by the time the project became effective there was commitments of USD8 million from OPEC and 10 million euros from EIB. Unfortunately, due to the socio-political unrest, EIB suspended all its operations after disbursing about 3.5 million euros. The OPEC Fund has disbursed 90% of its commitment and is scheduled to close in December 2003.

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Component Disbursements at Project Closure

Component DisbursementsCivil Works – Infrastructure Improvements $18,160,000Technical Assistance – capacity building $ 300,000Project Management Support $ 1,190,000Counterpart contribution $ 1,165,283Total $20,815,283

6. Sustainability

6.1 Rationale for sustainability rating:The sustainability of the project is rated "unlikely". Under the present sociopolitical conditions and high poverty rates, the sustainability of completed projects with particular reference to operation and maintenance is questionable due to severe budget constraints faced by the central government, municipalities and village councils. While donor programs continue to provide budget support to municipalities to sustain their operations, it is unlikely they will be continued in the long term. However, continuation of donor funding for similar projects is highly likely. The Bank is already financing a follow-up project – the ICDP which is under implementation. Furthermore, nearly USD100 million of donor funded projects are under various stages of implementation as indicated in the table below.

Donor AmountBank - ICDP USD 10 millionFrance - Community Development Project 7 Million EuroUSAID-Community Services Program USD 75 million Islamic Development Bank – Community Projects USD 19 million Germany KFW – Employment Generation Program USD 7.4 millionCIDA- Employment Generation Program USD 3 millionArab Fund- Community Development Project USD 10 millionDFID –Community Development Project USD 2.0 million

6.2 Transition arrangement to regular operations:While continuation of community development projects is assured in the short-term through donor financing, the likelihood of government taking over the funding of similar programs is unlikely under the current sociopolitical climate. Nevertheless, capacity is being built within the government to prepare and implement community development projects. If, in the future, the government establishes its own social programs, then capacity would exist in-house in order to carry out the implementation of such program.

7. Bank and Borrower Performance

Bank7.1 Lending:The performance under this category is considered "satisfactory". The Bank recognized and responded to an urgent need form the client under a difficult environment (border closures) and

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prepared the project in less than 6 months. Furthermore the total cost for project preparation from identification through Board was less than USD50,000. The project was one of the first to promote the use of poverty maps to target interventions in the West Bank and Gaza. The Bank was also able to partner with UNWRA to address the needs of refugee camps which had previously been left out of Bank lending operations.

7.2 Supervision:The rating of Bank supervision is considered "satisfactory". The presence of the country office staff in both the West Bank and Gaza ensured consistent supervision of the project in the field. The close working relationship built through the long association with the implementing agencies under the previous Holst and CDP I projects, greatly enhanced follow-up and constructive feedback between the client and the Bank. The Bank team was also seen as very responsive in times of crisis - in particular the advice and facilitation provided during the dispute between PECDAR and contractors in Gaza which resulted in an amiable solution. The Bank team also pursued a good monitoring and evaluation strategy - there were regular assessments - both technical (1 technical assessment including progress on the (EMP) and social (3 beneficiary surveys) to gauge community responses to the project. Lessons learnt were incorporated into follow-up ICDP projects.

7.3 Overall Bank performance:The Bank performance is judged "satisfactory". The project was prepared quickly, adapted well to the sociopolitical crisis due to the flexibility in its design and closed on schedule after meeting its objectives. The Bank's effort in preparation and supervision have been both time and cost efficient. The total budget for preparation and supervision of the project was around USD300,000. The Bank has maintained a good working relationship with the client.

Borrower7.4 Preparation:The borrower's performance is rated as "satisfactory". Following the success of CDP I, the Government used its consultations with the Bank's President to request an immediate follow-up project. The Government and in particular the Ministry of Local Government, DORA and the MOF played a major role in facilitating the rapid preparation, appraisal and negotiations of the project.

7.5 Government implementation performance:The Government's performance is judged "satisfactory". The project was implemented without any suspension or major delays even though the Government was under severe political and financial crisis. MOF continued to make payments on service charges and ensured that the Government's financial obligations were met.

7.6 Implementing Agency:The Implementing Agency's performance is rated "highly satisfactory". An area of concern under CDP I was the limited cooperation between MOLG - the line agency responsible for municipalities and villages and PECDAR. However, under CDP II, three agencies - PECDAR, MOLG and DORA have worked very well together from preparation through implementation. This cooperation was institutionalized through an implementation agreement and responsibility matrix signed by the heads of all three organizations. The division of responsibilities and good

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working and personal relationships between the project coordinators of the three implementing agencies ensured smooth project implementation. Monthly portfolio meetings were held where new projects and implementation of on-going projects were discussed. Monthly progress reports were a norm throughout project implementation and all independent financial audits conducted on CDP II have given PECDAR a clean bill of health. The implementing agencies were also able to adapt to the Intifada and continued to perform under very trying circumstances. For example: PECDAR provided lodging for their staff close the office in order to reduce the uncertainty of travelling daily from their homes.

7.7 Overall Borrower performance:The overall rating of the borrower's performance is "highly satisfactory" based on its ability to work well, implement the project on schedule, meet and in some cases surpass performance indicators. All these achievements were accomplished under the worst possible sociopolitical conditions.

8. Lessons Learned

1. Flexibility in Design: Interventions designed in a post-conflict/in-conflict area should have a certain amount of flexibility in design in order to absorb shocks due to the conflict and still be relevant in meeting the projects development objective. Furthermore, having the ability to fine tune the design to respond to rapid changes on the ground – such as removing the requirement for community cash contributions when the poverty rates had risen over 50% - ensured that the poorest, who the project was designed to serve, were not the ones left out due to stringent requirements. Based on this lesson, the follow-up project, ICDP, continues with a flexible demand-driven design.

2. Development Objective: It is important to have a clearly focused development objective. Projects which have multiple objectives and are very broad tend to make monitoring and measurement of achievements very difficult. Furthermore, in a post-conflict situation there are multiple priorities and a hunger for quick results. There is a propensity to design projects that encompass both short-term emergency priorities as well as long-term development. Hence under ICDP, the project design has one development objective and does not address short-term emergency impacts.

3. Targeting Strategy: Limited funding coupled with huge needs requires a well designed targeting strategy. The development and use of the poverty map for identifying project areas assisted the IAs to target the resources for maximum impact. Moreover, the poverty map and targeting strategy provided the IAs with a clear and transparent rationale for project selection and reduced concerns over favoritism in project selection.

4. Attracting Cofinancing: Establishing and maintaining a successful and transparent partnership with donors contributed significantly in leveraging high amounts of cofinancing for CDP II. The OPEC fund had a very successful experience in parallel financing CDP I and hence was eager to repeat the partnership. EIB had a successful working relationship with the Bank on the Solid Waste Management Project (SWEMP) and looks forward to working together on additional interventions.

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5. Decentralization: Having a local and decentralized presence both within the implementing and donor agencies contributes to efficiency and empowerment, particularly in a conflict environment. The full closures and movement restrictions forced the IAs to rethink their mostly centralized approach to project management. Similarly, having the presence of Bank country offices in both West Bank and Gaza with local project coordinators, greatly enhanced the supervision and advisory role provided by the Bank to the client.

9. Partner Comments

(a) Borrower/implementing agency:

PALESTINIAN AUTHORITYPALESTINIAN ECONOMIC COUNCIL

FOR DEVELOPMENT ANDRECONSTRUCTION

(PECDAR)

Mr. Kanthan ShankerTask ManagerWest Bank & GazaThe World Bank

Date: 6/2/2003Ref. : PMO-A/305/03

Subject: Second Community Development ProjectCDPII, Implementation Completion Report (TF 26044)

Dear Kanthan,

Following the completion of all activities of the Second Community Development Project (CDPII) and discussion held to present PECDAR’s input and comments in preparation of the Implementation Completion Report (ICR), this is first to express our great grateful and appreciation to yourself and to the World Bank resident team, who have participated in the implementation of the CDPII for their commendable work and assistance during the implementation of this program.Micro-projects were implemented in accordance with the Guidelines and responsibility matrix agreed upon in the project documents, the community contribution in identification of their priorities and needs, and the cash or labor contribution to the cost of microprojects have built ownership on the ground and self-confidance of the community. Moreover it has increased the likelihood that the project could be maintained and sustained in long term. Most of the projects have always reflected the most urgent needs and priorities of the communities.

A socio – economic impact assessment on selected microprojects has been conducted by a socio-economic expert. The assessment aimed to evaluate the socio-economic impact of the micro projects on the communities, to find out how the beneficiary communities participated in the

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different phases of the projects; whether they were satisfied with the micro-projects and the institutional impact of the micro projects on their local government units and other local institutions. Special attention was given so that the samples represent the different sectors and geographical areas of the microprojects.

The flexibility and wide sector targeting the strategy of the CDP II allowed the beneficiaries to gain economic and social development. The sectors covered the implementation of more than 200 micro-projects in the education, health care, water and wastewater, roads and other construction projects. The implementation of the micro-projects was in a short time horizon, thus ensuring the commitment of the donor countries and the Palestinian National Authority towards alleviating poverty and economic situation in the current period.

In general, Beneficiaries are satisfied with the positive impact of microprojects on their living conditions. Micro-projects which were tendered and contracted by PECDAR had high involvement of the LGU’s during implementation. The LGU’s were informed about strategy and procedures of the project and were directly involved in procurement of goods, works, and services especially for microprojects implemented under direct hire procedure, however, the finding shows weakness in informing and involvement of the community in project. Through the finance of $8 million US Dollars from IDA, $8 million from OPEC and about $3 million from EIB. It was possible to create short and long-term job opportunities. An average of 25% labor content was observed as originally envisioned during the design of the project.

The designs of the CDPII procedure come from prior experience gained through CDPI program. It has provided opportunities for more interactions between beneficiaries and the implementing agency and closer coordination among the beneficiaries themselves and involved parties during the different stages of microprojects implementation.

The approval of funding of the Integrated Community Development Project (ICDP) and the Employment Generation for Social Development (EGSD) is a good indicator for the success of the CDPII program and all parties involved in the appraisal, implementation, and monitoring of the activities. Other donors have showed interest in co-financing to this program.

I am confident that the second community development project has reached its target. In our view, the World Bank, Ministry of Local Government Department of Refugee Camp (Dora), benefited Local Government Units (LGU’s) were co-operative and showed magnificent interest in implementing the program to their best, which in turn resulted to a successful construction of the fund achieving all Predrawn objectives and goals.

Best regards,

Dr. Hisham ShkoukaniPMO – Director

CC: Mr.M.Basisy, MOLG : Mr.A.Hanoun, DORA

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Letter from MOLG

Mr. Kanthan ShankarTask Team LeaderWest Bank & Gaza

Subject: Implementation Completion Report –Feedback on the Second Community Development Project (CDPII)

Dear Kanthan;

In reference to the above mentioned subject, we thank you for your great efforts for the success of the project which set the rails for the development of the Integrated Community Development Project, which we hope to be very successful through the full cooperation of all parties.

As for the feedback you requested in your letter dated January 28, 2003 We’d like to point out the following:-

I - Bank’s Performance

1) Great efforts have been done by the World Bank staff which contributed to the success of the project especially your efforts and Hisham Labadi, Husam Abu Dagga and Fifi Antar as well.

2) Field visits done by MLG, PECDAR, DORA and the World Bank to the projects had a great influence on the success of the project despite the difficult conditions encountered during the last two years.

II - Obstacles Faced

1) Restriction of movement made steering committee meetings very difficult which caused some difficulties in project approvals.

2) Continuous closures caused difficulties in communications with the involved parties that caused some delays in project implementation especially road projects.

3) Increased poverty and lack of jobs made the collection of community participation in cash, initially set at a minimum of 10%, very difficult.

4) Setting the project upper limit at US$150,000 caused some projects to remain incomplete, we think that flexibility is needed to cope with any increase in the project cost.

5) After the intifada, National Competitive Bidding became useless in some areas as only a limited number of contractors could reach the new projects. The other choice of simplified biddings was increasingly used.

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III - Lessons Learnt

1) The local authorities must have more responsibilities so that they can build up their capacities in Management and financial issues of the projects which in turn lead to the development of their community.

2) Emphasis on local community participation is important so that their recommendations regarding need for the project can be materialized..

3) More comprehensive training courses or workshops should be given to the community representatives to enhance their capabilities.

4) A site engineer is always important for quality of the project and also to create jobs for unemployed engineers

IV - Social and Economical Impacts

1) The projects implemented helped to develop the Local Governments and the society especially in projects aimed at children, women, schools and school roads.

2) The economical impact may be noticed in the following:-a- Road pavements: Decreases veihcles maintenance costs and increases the effective time of people in all aspects of life.b- Maintenance of water network decreases the water losses and in turn saves money,

moreover, income-generating projects become much easier to establish.

3) Social and environmental impacts:-a- Developing the infrastructure develpos the environment in general. Paved roads

are clear, potable water is important for drinking, electricity changes life entirely. Thus, the society is developed to healthier enviroment, less diseases and more relaxation.

b- Schools: The program improved access for education and helped students, girls and boys, in providing new classes and better roads to reach schools in easier and cleaner way along paved school roads.

Unfortunately many communities are still in bad need for projects. We hope that the Integrated Community Development Project will further rehabilitate the infrastructure, develop the Palestinian communities, improve the environment and contribute effectively to social development.

With Best Regards

Hani KayedDirector of Project Department

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Letter from DORA

Mr. Khanthan Shankar April 22, 2003Task managerWest Bank & GazaThe World Bank

Feedback on the CDPII implementation completion report

Thank you for your interest to understand Dora's feedback on the implementation completion report.

In reference to the feedback that you received from our colleagues in the coordination committee in PECDAR and the Ministry of Local Government. I would like to reaffirm their comments and I hereby express my appreciation to the efforts of the World Bank and our partners in the CDPII especially Dr. Saab Areikat and Dr. Mohamad Shtaieh and their team who have shown excellent cooperation in facilitating the implementation of the project.

Our Feedback:

1. The Department of Refugee Affairs - project department achieved high efforts to aim strengthen coordination and cooperation with our partners in order to achieve the best possible results.

2. The share that the refugee camps received from the projects is very minimal when compared to their real needs in the refugee camps. This result is considered an input in the operation manual for the ICDP.

3. There is a need for special training for the coordinating committee to improve reporting skills and to exchange experiences with other countries.

Ahmad HanounProject CoordinatorCDPIIThe Department of Refugee Affairs

C.C. Director General DORA

(b) Cofinanciers:Ms. Bettina Muscheidt, Task Manager for EIB funding wrote: "In 1998/99 the EIB became closely involved in the small scale infrastructure program by the World Bank targeted at poorer areas of Gaza West Bank, including refugee camps (after a process of social mapping). The basic

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design and a first phase of this program had been led by the World Bank. The second phase benefitted from the experience of the first phase and the World Bank developed institutional aspects and the social targeting furthermore. The EIB contributed to this second phase of the program with a loan of EUR 10m. The new institutional arrangements with a sense of enhanced "ownership of the Palestinian Authority" helped with the smooth disbursements of this loan. Further implementation came to a halt due to the outbreak of the second Intifada". Mr. Al-Turki of OPEC Fund indicated that they were very satisfied with CDP II and in particular appreciated the World Bank's effort in administering their funds. He indicated that they are interested in continuing the cooperation on the follow-up Integrated Community Development Project.

(c) Other partners (NGOs/private sector):

10. Additional Information

Lists of Projects IDA- Gaza Projects

# Project Code Project Name Town/Village

Area Sector Project Value US$

1 CDP2/IDA/024.GZ Developing Road No. 3,4 & 5 Gaza City North Roads 38,2912 CDP2/IDA/038.GZ Developing 1st phase of internal Roads Gaza City Middle Roads 83,8253 CDP2/IDA/023.GZ Developing Road No. 1 & 2 Gaza City North Roads 57,2674 CDP2/IDA/022.GZ New sewage line for different Streets Gaza City North Sewage 82,9085 CDP2/IDA/039.GZ Developing the 2nd phase of internal

Roads Gaza City Middle Roads 84,110

6 CDP2/IDA/040.GZ Developing the 1st phase of internal Roads

Gaza City Middle Roads 118,338

7 CDP2/IDA/011.GZ Developing Road No. 02 at Al-Amal area


8 CDP2/IDA/041.GZ Developing the 2nd phase of internal Roads


9 CDP2/IDA/010.GZ Developing the area behind Al-Abas mosque

Gaza City North Roads 54,244

10 CDP2/IDA/027.GZ Developing the extension of Charles De Gaulle Street

Gaza City North Roads 20,437

11 CDP2/IDA/004.GZ Developing the eastern Road (Ex. Sakia)

Khan Younis South Roads 113,535

12 CDP2/IDA/019.GZ Developing of Senati internal Road Big Abassan South Roads 115,05713 CDP2/IDA/017.GZ Developing Road No. 02 at a refugee

CampKhan Younis South Roads 86,882

14 CDP2/IDA/009.GZ Developing Sad El Ali Street at a refugee Camp

Khan Younis South Roads 113,726

15 CDP2/IDA/018.GZ Developing of internal Roads Khan Younis South Roads 130,76616 CDP2/IDA/003.GZ Developing of internal Roads Khan Younis South Roads 141,26017 CDP2/IDA/037.GZ Installing rain water pipes- S. Abbasan Khan Younis South Water 37,50018 CDP2/IDA/036.GZ Installing sewage pipes at Block 4 Bureij Camp Middle Sewage 37,49119 CDP2/IDA/033.GZ Developing of internal Road Bureij Camp Middle Roads 149,26320 CDP2/IDA/026.GZ Side walks for Madares Street Maghazi

CampMiddle Roads 113,880

21 CDP2/IDA/008.GZ Construction of public services building Msadar area Middle Public Building

38,247

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22 CDP2/IDA/032.GZ Developing of internal Road Nusairat Camp

Middle Roads 112,394

23 CDP2/IDA/035.GZ Installing water pipes for Western Abu Salim

Nusairat Camp

Middle Water 35,812

24 CDP2/IDA/006.GZ Construction of the second floor of the services building group

Wadi El Salka

Middle Public Building

55,356

25CDP2/IDA/044.GZ (EIB/009.GZ )

Paving Salah Khalaf Street Zawaida village

Middle Roads 103,638

26 CDP2/IDA/043.GZ (EIB/003.GZ )

Paving the connecting entrance to the main Road

Beit Lahia City

North Roads 99,983

27 CDP2/IDA/007.GZ Developing the cemetery Road (Ex. Adjacent Road)

Beit Lahia City

North Roads 54,673

28 CDP2/IDA/042.GZ (EIB/001.GZ )

Developing the access Road to Tal Ezzatar area

Jabalia Camp North Roads 140,948

29 CDP2/IDA/013.GZ Developing Khazan Street Jabalia Camp North Roads 149,87830 CDP2/IDA/034.GZ Installing water pipes for Abed Rabou

areaJabalia Camp North Water 37,465

31 CDP2/IDA/012.GZ Developing Daher Street Jabalia Camp North Roads 81,59032 CDP2/IDA/016.GZ Sewage network-Phase III at Shaboura

CampRafah Camp South Sewage 87,807

33 CDP2/IDA/014.GZ Developing Road No. 01 at Shaboura Camp

Rafah Camp South Roads 112,998

34 CDP2/IDA/015.GZ Developing Road No. 02 at Shaboura Camp

Rafah Camp South Roads 148,718

IDA - West Bank Projects# Project Code Project Name Town/Village Area Sector Project

Value US$35 CDP2/M/022 Construction of 4 classrooms for

elementary schoolKufur Malik Middle Education 40,000

36 CDP2/M/016 Construction of 3 classrooms for co-educational school

Ain Senia Middle Education 34,753

37 CDP2/M/006 Rehabilitation of internal Roads Ain Sultan Camp

Middle Roads 66,373

38 CDP2/M/019 Construction of 2 classrooms Al Mazra’ Sharqia

Middle Education 50,000

39 CDP2/M/011 Construction of 2 classrooms Al Mughayer Middle Education 29,14840 CDP2/M/008 Rehabilitation of access Road Beit Dukko Middle Roads 107,32841 CDP2/M/014 Construction of 3 classrooms Dair Amar Middle Education 20,00042 CDP2/M/020 Construction of 2 classrooms Khirbat Abu

FalahMiddle Education 29,596

43 CDP2/M/015 Rehabilitation of school playground Jabaa Middle Education 49,65044 CDP2/M/005 Rehabilitation of internal Roads Jericho Middle Roads 81,49045 CDP2/M/010 Rehabilitation of access Road Karbatha

MosbahMiddle Roads 80,309

46 CDP2/M/018 Construction of 6 classrooms for co-educational school

Mazarea Nobani

Middle Education 118,038

47 CDP2/M/001 Construction of 9 classrooms for boys school

Ne’leen Middle Education 104,656

48 CDP2/M/004 Rehabilitation of access Road Deir Qiddies Middle Roads 91,27449 CDP2/M/009 Finishing 8 classrooms for girls school Qarawat Bani Middle Education 109,577

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Zaid50 CDP2/M/012 Rehabilitation of water network Qatanna Middle Water &

Sewage19,392

51 CDP2/M/026 Rehabilitation of public center and kindergarten

Beit Reema Middle Community Center

5,000

52 CDP2/M/013 Finishing works of hospital Ramallah Middle Health 14,65053 CDP2/M/024 Maintenance of the legislative court Ramallah Middle Community

Center 26,933

54 CDP2/M/027 Finishing of 5 classrooms at intermediate boys’ school

Ramallah Middle Education 29,000

55 CDP2/M/003 Rehabilitation of access Road Shebteen Middle Roads 116,18056 CDP2/M/021 Construction of classroom Sour Baher Middle Education 22,10857 CDP2/N/041 Rehabilitation of internal Roads Talouza and Al

Bathan North Roads 78,000

58 CDP2/N/010 Construction of rain water main lien Ain Al maa Camp

North Water & Sewage

68,606

59 CDP2/N/033 Construction of sanitary facilities at girls’ school

Al Mughayer North Education 32,184

60 CDP2/N/013 Rehabilitation of internal Roads Asera Shamalia North Roads 134,33961 CDP2/N/003 Rehabilitation of main Road Balata Camp North Roads 126,72062 CDP2/N/022 Rehabilitation of link Road Boureen - Iraq

BoureenNorth Roads 44,800

63 CDP2/N/015 Construction of 4 classrooms Burqeen North Education 63,90064 CDP2/N/030 Finishing works of 3 classrooms at

boys’schoolDair Ballout North Education 30,000

65 CDP2/N/023 Rehabilitation of access Road Deir El Hatab North Roads 107,47066 CDP2/N/034 Construction of 4 classrooms at girls’

schoolDeir Ghsoon North Education 85,000

67 CDP2/N/001 Rehabilitation of internal Roads Faquaa North Roads 113,51968 CDP2/N/017 Rehabilitation of internal Roads Hablah North Roads 75,00069 CDP2/N/028 Finishing works of 3 classrooms Hewara North Education 33,75470 CDP2/N/008 Rehabilitation of internal Roads Immateen North Roads 83,96771 CDP2/N/014 Construction of 6 classrooms Irtah North Educations 133,70872 CDP2/N/006 Construction of 6 classrooms Jureesh North Education 127,28773 CDP2/N/007 Rehabilitation of internal Roads Kufur Haris North Roads 65,96474 CDP2/N/009 Construction of 6 classrooms at a primary

schoolKufur Labad North Education 95,565

75 CDP2/N/040 Asphalting of main Street - Al Ma’ajeen Nablus North Roads 53,97876 CDP2/N/005 Rehabilitation of internal Roads Nassarieh North Roads 114,85777 CDP2/N/004 Rehabilitation of main Road New Askar

CampNorth Roads 109,998

78 CDP2/N/012 Construction of 6 classrooms Qusra North Education 135,88779 CDP2/N/032 Construction of handicapped center Salfeet North Public

Building29,942

80 CDP2/N/018 Construction of 6 classrooms Sanoor North Education 105,89081 CDP2/N/016 Rehabilitation of internal Roads Sarta North Roads 91,40482 CDP2/N/029 Construction of 2 school halls Shuwekeh North Education 15,79083 CDP2/N/011 Rehabilitation of internal Roads Talouza North Roads 41,33084 CDP2/N/031 Construction of retaining walls Tammoun North Roads 13,45985 CDP2/N/002 Construction of 7 classrooms at boys’

schoolTayaseer/Tubas North Education 125,928

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86 CDP2/N/027 Finishing works of 3 classrooms Zaboba North Education 20,25487 CDP2/S/002 Rehabilitation of access Road Bateer South Roads 111,37288 CDP2/S/014 Rehabilitation of court building Beit Lehem South Public

Building9,795

89 CDP2/S/012 Finishing works of health clinic Deir Razeh South Health 30,00090 CDP2/S/008 Rehabilitation of public garden Hebron South Public

Building44,770

91 CDP2/S/004 Rehabilitation of access Road Jala South Roads 61,18792 CDP2/S/005 Construction of service building Janata South Public

Building102,830

93 CDP2/S/003 Rehabilitation of internal Roads Sureef South Roads 133,00794 CDP2/S/006 Rehabilitation of access Road Tafouh South Roads 73,60095 CDP2/S/001 Construction of 5 classrooms Wadi Nees South Education 101,47296 CDP2/S/007 Construction of 7 classrooms Yata South Education 93,44897 CDP2/S/013 Finishing 3 classrooms Yata South Education 20,000

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Annex 1. Key Performance Indicators/Log Frame Matrix

Outcome / Impact Indicators:

Indicator/Matrix

Projected in last PSR1

Actual/Latest Estimate

- Indicators of improved access of affected population to services, such as roads, water supply and sanitation, clinics, schools.

- Indicators of improved access to the services such as roads, water supply and sanitation, clinics , schools etc.

All three BIAs and the ICR workshop indicated satisfaction with the improvement with the infrastructure services.

Indicators of beneficiary satisfaction with services provided.

Beneficiary Impact Assessment confirms beneficiary satisfaction with CDP II

All the BIAs conducted and the stakeholders workshop reflect clearly that the communities were satisfied with the project objectives, projects implemented and expressed interest in project continuation

Output Indicators:

Indicator/Matrix

Projected in last PSR1


More than 100 microprojects implemented in first 18 months of credit.

Over 150 projects implemented, A total of 200 infrastructure projects implemented in 153 communities benefiting over 1 million people.

a minimum of 4 seminars/workshops for small contractors,

4 seminars provided for small contractors 67 seminars/workshops for members of communities

7000 full time job equivalents over the life of the project

5000 full time job equivalents generated, over 10500 full time job equalivalents

95% of labor and 60% of materials procured locally

100% of labor and over 60% of materials procured locally

100% of labor and over 60% of materials procured locally

1 End of project

Project Outputs and Achievements by Activity TypeOBJECTIVE TARGET (Indicator) ACHIEVEMENT

i. Roads & SidewalksRehabilitation & improvement of networks

Roads (km) Sidewalks (km)

325 km of roads upgraded/rehabilitated26 km of sidewalks completed.7 seminars/workshops for members of communities

ii. Water & SanitationRehabilitation & improvement of water & wastewater networks

Sewage (km) 23 km of sewer lines10 km of water supply lines

iii. Multi-purpose Public Buildings Area (m2) 8000 m2 rehabilitated & constructed9 Multiple service centersMaintenance of 2 courtsConstruction of handicapped centerConstruction of community hall Construction of new market at Jabalia cityConstruction of 2 youth centers Construction of training centerRehabilitation of public garden in Hebron

EducationRehabilitation & construction of schools

Classrooms (no.) 250 classrooms constructed and 3 kindergartens

HealthRehabilitation of medical centers

Area (m2) 820 m2 rehabilitated(2 health centers and primary health care units in community service centers).

Training Seminars to increase capacity among LGUs

Numbers - Four seminars provided Equipment Provided

67 training workshops organized 1162 participants attended various training sessions. 2 training center in villages established 57 local government units and DORA were supplied with surveying/engineering equipment, computers and printers.

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Annex 2. Project Costs and Financing

Project Cost by Component (in US$ million equivalent)AppraisalEstimate


Percentage of Appraisal

Component US$ million US$ millionCivil Works 12.30 19.33 157Goods, Vehicles and Equipment 0.10Consultancies, Studies and Training 0.60 0.20 33.3Incremental Operating Expenses 0.80 1.19 149

Total Baseline Cost 13.70 20.82 Physical Contingencies 0.50 Price Contingencies 0.80

Total Project Costs 15.00 20.82Total Financing Required 15.00 20.82

Project Costs by Procurement Arrangements (Appraisal Estimate) (US$ million equivalent)

Expenditure Category ICBProcurement

NCB Method

1

Other2 N.B.F. Total Cost

1. Works 0.00 10.00 3.50 0.00 13.50(0.00) (5.20) (1.80) (0.00) (7.00)

2. Goods 0.00 0.00 0.10 0.00 0.10(0.00) (0.00) (0.10) (0.00) (0.10)

3. Services 0.00 0.00 1.40 0.00 1.40(0.00) (0.00) (0.90) (0.00) (0.90)

4. Miscellaneous 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

5. Miscellaneous 0.00(0.00)

0.00(0.00)

0.00(0.00)

0.00(0.00)

0.00(0.00)


0.00(0.00)

0.00(0.00)

0.00(0.00)

0.00(0.00)

Total 0.00 10.00 5.00 0.00 15.00(0.00) (5.20) (2.80) (0.00) (8.00)

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Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ million equivalent)

Expenditure Category ICBProcurement

NCB Method

1

Other2 N.B.F. Total Cost

1. Works 0.00 16.80 1.36 1.17 19.33(0.00) (6.30) (0.90) (0.00) (7.20)

2. Goods 0.00 0.00 0.10 0.00 0.10(0.00) (0.00) (0.10) (0.00) (0.10)

3. Services 0.00 0.00 1.39 0.00 1.39(0.00) (0.00) (0.70) (0.00) (0.70)

4. Miscellaneous 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)


0.00(0.00)

0.00(0.00)

0.00(0.00)

0.00(0.00)


0.00(0.00)

0.00(0.00)

0.00(0.00)

0.00(0.00)

Total 0.00 16.80 2.85 1.17 20.82(0.00) (6.30) (1.70) (0.00) (8.00)

1/ Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingencies.2/ Includes civil works and goods to be procured through national shopping, consulting services, services of contracted staff

of the project management office, training, technical assistance services, and incremental operating costs related to (i) managing the project, and (ii) re-lending project funds to local government units.

Project Financing by Component (in US$ million equivalent)

Component Appraisal Estimate Actual/Latest EstimatePercentage of Appraisal

Bank Govt. CoF. Bank Govt. CoF. Bank Govt. CoF.Civil Works 7.00 1.50 5.00 7.21 1.17 11.00 103.0 78.0 220.0Technical Assistance 0.40 0.00 0.20 0.30 0.00 0.00 75.0 0.0 0.0Project Management 0.60 0.00 0.30 0.50 0.00 0.69 83.3 0.0 230.0

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Annex 3. Economic Costs and Benefits

The cost effective model is based on a simple scoring system using seven indicators: village/town size, community contribution, labor content, cost per beneficiary, cost per worker, cost per person day of employment and cost per construction day. Each of these indicators were allocated scores from 0 to 4. Individual scores were decided based on experience and studies by local researchers on employment generation programs. Example of two indicators:

Labor Content Score Community Contribution

Score

0 to 10% 0 0 to 10% 010 to 20% 1 10 to 20% 120 to 30% 2 20 to 30% 2Over 30% 4

The data for the seven indicators were obtained from the project appraisal forms and input into an excel spread sheet. A scoring system was developed for acceptance or rejection of the proposed project based on aggregate scores. The maximum score was 25 and the minimum was 2. Projects with scores above 10 were acceptable. This model was used as part of project appraisal and was one of several criteria used for project selection.

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Annex 4. Bank Inputs

(a) Missions:Stage of Project Cycle Performance Rating No. of Persons and Specialty

(e.g. 2 Economists, 1 FMS, etc.)Month/Year Count Specialty

ImplementationProgress

DevelopmentObjective

Identification/Preparation09/21/98 3 2 engineers and 1 social scientist

Appraisal/Negotiation02/01/99 5 2 engineers, 1 procurement

specialist, 1 financial management specialist, 1 social scientist

Supervision

10/30/1999 3 roads/procurement (1); operations analyst (1); TTL/environment (1)

S S

06/07/2000 3 operations officer (1); Task Team Leader (1); operations analyst (1)

S S

11/17/2000 3 operations analyst (1); env. egr /TTL (1); operations officer--STC (1)

S S

04/20/2001 4 social scientist(1) operations officer (1);Task Team Leader (1);operations analyst (1)

S S


S S


S S

ICR04/22/2003 3 operations officer (1);

Task Team Leader (1); operations anaylst (1)

S S

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(b) Staff:

Stage of Project Cycle Actual/Latest EstimateNo. Staff weeks US$ ('000)

Identification/Preparation 10 36,000.00Appraisal/Negotiation 4 12,158.74Supervision 62.4 224,471.67ICR 10 36,000.00Total 86.4 308,630.41

Assumptions: one staff week costs USD 3,600. Please also note Trust Funds of USD 23,132.75 were used in preparation.

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Annex 5. Ratings for Achievement of Objectives/Outputs of Components(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)

RatingMacro policies H SU M N NASector Policies H SU M N NAPhysical H SU M N NAFinancial H SU M N NAInstitutional Development H SU M N NAEnvironmental H SU M N NA

SocialPoverty Reduction H SU M N NAGender H SU M N NAOther (Please specify) H SU M N NA

Private sector development H SU M N NAPublic sector management H SU M N NAOther (Please specify) H SU M N NA

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Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performance Rating

Lending HS S U HUSupervision HS S U HUOverall HS S U HU

6.2 Borrower performance Rating

Preparation HS S U HUGovernment implementation performance HS S U HUImplementation agency performance HS S U HUOverall HS S U HU

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Annex 7. List of Supporting Documents

- Beneficiary Impact Assessment, 1998- Social Impact Assessment October 2002- Beneficiary Impact Assessment BIA, February 2003- Minutes of Beneficiary Workshop, May 1, 2003- Environmental Management Plan- Poverty Map- Procurement Audit- Social, Technical, Institutional and Environmental Assessment- Cost Effectiveness Model- Operational Manual

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