the world bankdocuments.worldbank.org/curated/en/603601468197957929/...20-dec-2016 senior global...

Document of

The World Bank

FOR OFFICIAL USE ONLY

Report No: PAD1591

INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT

PROJECT PAPER

FOR AN

ADDITIONAL LOAN

IN THE AMOUNT OF US$66.7 MILLION

TO THE

REPUBLIC OF AZERBAIJAN

FOR THE

IDP LIVING STANDARDS AND LIVELIHOODS PROJECT

June 17, 2016

Social, Urban, Rural and Resilience Global Practice Europe and Central Asia Region This document is being made publicly available prior to Board consideration. This does not imply a presumed outcome. This document may be updated following Board consideration and the updated document will be made publicly available in accordance with the Bank’s policy on Access to Information.

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CURRENCY EQUIVALENTS

(Exchange Rate Effective May 20, 2016)

Currency Unit = New Azerbaijani Manat (AZN) AZN 1.49 = US$1

US$0.71 = SDR 1

FISCAL YEAR January 1 – December 31

ABBREVIATIONS AND ACRONYMS

AF Additional Financing CPF Country Partnership Framework ESMF Environmental and Social Management Framework FM Financial Management GoA Government of Azerbaijan GRM Grievance Redress Mechanism GRS Grievance Redress Service IDP Internally Displaced Person IFR Interim Financial Report O&M Operations and Maintenance OM Operational Manual PDO Project Development Objective PIU Project Implementation Unit RAP Resettlement Action Plan RPF Resettlement Policy Framework SFDI Social Fund for the Development of IDPs

Vice President: Cyril E Muller Country Director: Mercy Miyang Tembon

Senior Global Practice Director: Ede Jorge Ijjasz-Vasquez Country Manager: Larisa Leshchenko Practice Manager: Nina Bhatt

Task Team Leader: Michelle P. Rebosio Calderon

REPUBLIC OF AZERBAIJAN ADDITIONAL FINANCING TO IDP LIVING STANDARDS AND LIVELIHOODS

PROJECT (P155110)

CONTENTS Project Paper Data Sheet i

Project Paper

I. Introduction 1

II. Background and Rationale for Additional Financing 1

III. Proposed Changes 3

IV. Appraisal Summary 12

18

V. World Bank Grievance Redress

Annexes

Annex 1: Revised Results Framework and Monitoring Indicators

19

ADDITIONAL FINANCING DATA SHEET

Republic of Azerbaijan

Additional Financing to IDP Living Standards and Livelihoods Project (P155110)

EUROPE AND CENTRAL ASIA

SOCIAL, URBAN, RURAL AND RESILIENCE

Basic Information – Parent

Parent Project ID: P122943 Original EA Category:

B - Partial Assessment

Current Closing Date: 31-Dec-2016

Basic Information – Additional Financing (AF)

Project ID: P155110 Additional Financing Type (from AUS):

Scale Up

Regional Vice President:

Cyril E Muller Proposed EA Category:

Country Director: Mercy Miyang Tembon Expected Effectiveness Date:

20-Dec-2016

Senior Global Practice Director:

Ede Jorge Ijjasz-Vasquez

Expected Closing Date:

31-Dec-2020

Practice Manager/Manager:

Nina Bhatt Report No: PAD1591

Team Leader(s):

Michelle P. Rebosio Calderon, Nijat Valiyev, Rebecca Emilie Anne Lacroix

Borrower

Organization Name Contact Title Telephone Email

Republic of Azerbaijan 994-124938103

Project Financing Data - Parent (IDP Living Standards and Livelihoods Project-P122943) (in US$, millions)

Key Dates

Project Ln/Cr/TF

Status Approval Date

Signing Date

Effectiveness Date

Original Closing Date

Revised Closing Date

ii

P122943 IBRD-80960

Effective 27-Oct-2011

16-Nov-2011

09-Feb-2012

30-Jun-2016 31-Dec-2016

Disbursements

Project Ln/Cr/TF

Status Currency Original Revised CancelledDisbursed

Undisbursed

% Disbursed

P122943 IBRD-80960

Effective

US$ 50.00 50.00 0.00 48.57 1.43 97.14

Project Financing Data - Additional Financing Additional Financing to IDP Living Standards and Livelihoods Project (P155110)(in US$, millions)

[X] Loan [ ] Grant [ ] IDA Grant

[ ] Credit [ ] Guarantee [ ] Other

Total Project Cost: 78.53 Total Bank Financing:

66.70

Financing Gap: 0.00

Financing Source – Additional Financing (AF) Amount

Borrower 11.83

International Bank for Reconstruction and Development 66.70

Financing gap 0.00

Total 78.53

Policy Waivers

Does the project depart from the CAS in content or in other significant respects?

No

Explanation

Does the project require any policy waiver(s)? No

Explanation

Team Composition

Bank Staff

Name Role Title Specialization Unit

Michelle P. Rebosio Calderon

Team Leader (ADM Responsible)

Senior Social Development Specialist

GSU03

iii

Nijat Valiyev Team Leader Senior Infrastructure Specialist

GTI03

Rebecca Emilie Anne Lacroix

Team Leader Social Development Specialist

GSU03

Sandro Nozadze Procurement Specialist (ADM Responsible)

Procurement Specialist

GGO03

Tural Jamalov Financial Management Specialist

Financial Management Specialist

GGO21

Daniel P. Owen Team Member Senior Social Development Specialist

GSU03

Geoffrey John Kurgan

Team Member E T Consultant Infrastructure specialist

GTI02

Gohar Grigorian Team Member Senior Program Assistant

GSU03

Gulana Enar Hajiyeva

Safeguards Specialist

Senior Environmental Specialist

Environmental safeguards

GEN03

Jimena Garrote Counsel Senior Counsel LEGLE

Jose Janeiro Team Member Senior Finance Officer

WFALA

Nigar Sadikhova Team Member Executive Assistant ECCAZ

Sarah G. Michael Team Member Program Leader ECCU3

Victoria Ahlonkoba Bruce-Goga

Team Member Program Assistant GSU03

Extended Team

Name Title Location

Locations

Country First Administrative Division

Location Planned Actual Comments

Azerbaijan Beylagan Rayon X X

Azerbaijan Beylaqan Beylagan Rayon X Khocavend settlement

Azerbaijan Beylaqan Beylagan Rayon X Harami area

Azerbaijan Beylaqan Beylagan Rayon X Yeni Khocavend settlement

iv

Azerbaijan Beylaqan Beylagan Rayon X Guneshli settlement

Azerbaijan Beylaqan Beylagan Rayon X Imamverdili village

Azerbaijan Beylaqan Beylagan Rayon X Kebirli village

Azerbaijan Beylaqan Beylagan Rayon X Tezekend village

Azerbaijan Beylaqan Beylagan Rayon X Shefeq settlement

Azerbaijan Beylaqan Beylagan Rayon X Tugh village

Azerbaijan Beylaqan Beylagan Rayon X Turkler village

Azerbaijan Zangilan X

Azerbaijan Yardymli Rayon X X

Azerbaijan Şuşa Rayonu X X

Azerbaijan Imisli Shakh-Verdylyar X

Azerbaijan Salyan Rayon X X

Azerbaijan Sabirabad Rayon X X

Azerbaijan Saatly Rayon X

Azerbaijan Bilasuvar Rayon X X

Azerbaijan Bilasuvar Rayon Bilasuvar Rayon X Settlement #5 Settlement #6

Azerbaijan Neftchala Rayon X X

Azerbaijan Masally District X X

Azerbaijan Lerik Rayon X X

Azerbaijan Lankaran Rayon X X

Azerbaijan Lankaran Rayon X

Azerbaijan Laçın Rayonu X X

Azerbaijan Aghjabadi Rayon Aran X Aran village

Azerbaijan Qubadli Rayon X X

Azerbaijan Xocalı X X

Azerbaijan Fuezuli Kerimbeyli X

Azerbaijan Imishli Rayon X X

Azerbaijan Imisli Imishli Rayon X Govektala village

Azerbaijan Imisli Imishli Rayon X Yeni settlement

Azerbaijan Imisli Imishli Rayon X Galinchaq village

Azerbaijan Imisli Imishli Rayon X Hacirustemli village

Azerbaijan Fizuli X

Azerbaijan Fuezuli Fizuli Rayon X Gayidish-3 settlement Gayidish-5 settlement Gayidish-6 settlement

v

Azerbaijan Fuezuli Fizuli Rayon X Zobucuq 5 settlement

Azerbaijan Fuezuli Fizuli Rayon X Gazakhlar village

Azerbaijan Fuezuli Fizuli Rayon X Shukurbeyli village

Azerbaijan Jebrail X

Azerbaijan Jalilabad X

Azerbaijan Fuezuli Boyuk Bahmanli X

Azerbaijan Fuezuli Bala Begmenli X

Azerbaijan Astara District X X

Azerbaijan Imisli Alikulular X

Azerbaijan Aghjabadi Rayon Aghjabadi Rayon X Aghgol area

Azerbaijan Aghjabadi Rayon Aghjabadi Rayon X Takhta Korpu area

Azerbaijan Aghjabadi Rayon Aghjabadi Rayon X Ashaghi Avshar Village

Azerbaijan Aghdam Rayon X X

Azerbaijan Agdam Aghdam Rayon X Kichikli village

Azerbaijan Agdam Aghdam Rayon X Guzanli settlement

Azerbaijan Agdam Aghdam Rayon X Seferli settlement

Azerbaijan Agdam Aghdam Rayon X Gasimbeyli settlement

Azerbaijan Agdam Aghdam Rayon X Tezekend Settlemetn

Azerbaijan Agdam Aghdam Rayon X Ergi area

Azerbaijan Agdam Aghdam Rayon X Ahmedaghali village

Azerbaijan Agdam Aghdam Rayon X Tezekend village

Azerbaijan Beylaqan Orankala X

Azerbaijan Beylaqan Yeni Mil X

Azerbaijan Fuezuli Horadiz X

Azerbaijan Imisli Oruclu X

Azerbaijan Beylaqan Yukhary-Chemenli

X

Azerbaijan Beylaqan Mayak X

Azerbaijan Beylaqan Bolsulu X

Azerbaijan Ali Bajramly X X

Azerbaijan Shirvan Shirvan X

Azerbaijan Şuşa Şəhəri X X

Azerbaijan Tartar Rayon X

Azerbaijan Zardab Rayon X X

Azerbaijan Qabala Rayon Zaragan X

vi

Azerbaijan Qabala Rayon Zaragan X Zaragab 2 settlement

Azerbaijan Zaqatala Rayon X X

Azerbaijan Agdam Birinci Yuzbasili X

Azerbaijan Yevlakh Rayon X X

Azerbaijan Goranboy Yengikend X

Azerbaijan Oguz Yaqublu X Yaqublu village

Azerbaijan Oghuz Rayon X X

Azerbaijan Oguz Oghuz Rayon X Boyuk Soyudlu settlement

Azerbaijan Oguz Oghuz Rayon X Jalud village

Azerbaijan Oguz Oghuz Rayon X kerimli village

Azerbaijan Ujar Rayon X

Azerbaijan Goygol Rayon Uchtepe X

Azerbaijan Tovuz Rayon X

Azerbaijan Barda Rayon Tagilar X

Azerbaijan Sumqayit Sumqayit X

Azerbaijan Shamakhi Rayon X X

Azerbaijan Shaki Rayon X X

Azerbaijan Shamkir Rayon X

Azerbaijan Abseron Saray X Saray Settlement

Azerbaijan Barda Rayon Saatli X

Azerbaijan Agdam Rzalar X

Azerbaijan Goranboy Rus Borisi X Rusborisi village

Azerbaijan Qazax X

Azerbaijan Qax X

Azerbaijan Qutqashen X

Azerbaijan Agdam Orta-Karvend X

Azerbaijan Barda Rayon Mollali X

Azerbaijan Barda Rayon Mollagyullar X

Azerbaijan Barda Rayon Mirzadzhafarli X

Azerbaijan Mingacevir City Mingelchaur X

Azerbaijan Agdam Mahrizli X

Azerbaijan Abseron Masazir X

Azerbaijan Qobustan X

Azerbaijan Kurdamir Rayon X X

vii

Azerbaijan Kurdamir Rayon Kurdamir Rayon X

Azerbaijan Qabala Rayon Qabala Rayon X Gabala city

Azerbaijan Qabala Rayon Qabala Rayon X Kurd village

Azerbaijan Qusar Rayon X X

Azerbaijan Quba Rayon X X

Azerbaijan Abseron Khirdalan X

Azerbaijan Khodzhavend X X

Azerbaijan Aghjabadi Rayon Khodzhavend X

Azerbaijan Goygol Rayon X X

Azerbaijan Goygol Rayon Goygol Rayon X Chaykend village

Azerbaijan Goygol Rayon Goygol Rayon X Garabulaq village

Azerbaijan Goygol Rayon Goygol Rayon X Mollacelilli village

Azerbaijan Goygol Rayon Goygol Rayon X Shehriyar village

Azerbaijan Goygol Rayon Goygol Rayon X Murovdagh settlement

Azerbaijan Goygol Rayon Goygol Rayon X Yeni Gizilca settlement

Azerbaijan Goygol Rayon Goygol Rayon X Balchili village

Azerbaijan Goygol Rayon Goygol Rayon X Jumshudlu village

Azerbaijan Goygol Rayon Goygol Rayon X Murovdagh village

Azerbaijan Goygol Rayon Goygol Rayon X Keremli village

Azerbaijan Goygol Rayon Goygol Rayon X Gizilqaya settlement

Azerbaijan Khankendi X X

Azerbaijan Khachmaz Rayon X X

Azerbaijan Kurdamir Rayon Karrar X

Azerbaijan Barda Rayon Kerimbeyli X

Azerbaijan Kəlbəcər Rayonu X X

Azerbaijan Goranboy Rayon X X

Azerbaijan Goranboy Goranboy Rayon X Kohne mesheli village

Azerbaijan Goranboy Goranboy Rayon X Ashaghi Aghcakend village

Azerbaijan Goranboy Goranboy Rayon X Irevanli village

Azerbaijan Goranboy Goranboy Rayon X Gazanchi village

Azerbaijan Goranboy Goranboy Rayon X Yeni kochkun settlement

Azerbaijan Goranboy Goranboy Rayon X Yeni Veyisli settlement

Azerbaijan Goranboy Goranboy Rayon X Kohne Veyisli village

Azerbaijan Goranboy Goranboy Rayon X Mesheli settlement

viii

Azerbaijan Goranboy Goranboy Rayon X Yeni yol village

Azerbaijan Goranboy Goranboy Rayon X Garachinar village

Azerbaijan Goranboy Goranboy Rayon X Gakhtut village

Azerbaijan Goranboy Goranboy Rayon X Gazanbulaq village

Azerbaijan Goranboy Goranboy Rayon X Ashiqli village

Azerbaijan Goygol Rayon Yeni Zod X

Azerbaijan Ismayilli Rayon X X

Azerbaijan Ismayilli Ismayilli Rayon X Kelbend village

Azerbaijan Ismayilli Ismayilli Rayon X Galinchaq village

Azerbaijan Ismayilli Ismayilli Rayon X Kelbend village

Azerbaijan Barda Rayon Guloglular X

Azerbaijan Barda Rayon Gulgazli X

Azerbaijan Barda Rayon Gulgazli X

Azerbaijan Goychay Rayon X X

Azerbaijan Ganja X X

Azerbaijan Ganja City Ganja X

Azerbaijan Kyadabek X X

Azerbaijan Goranboy Erkec X

Azerbaijan Davachi Rayon X X

Azerbaijan Dashkasan Rayon X X

Azerbaijan Dashkasan Rayon Dashkasan Rayon X Zaylik village

Azerbaijan Dashkasan Rayon Dashkasan Rayon X Gushchu village

Azerbaijan Goranboy Veyisli X

Azerbaijan Barda Rayon Boyuk Goyuslu X

Azerbaijan Agdam Benevshelyar X

Azerbaijan Balakan Rayon X X

Azerbaijan Oguz Bayan X

Azerbaijan Barda Rayon Barda Rayon X X Hesenqaya village

Azerbaijan Barda Rayon Barda Rayon X Kober village

Azerbaijan Barda Rayon Barda Rayon X Bacirevan village

Azerbaijan Barda Rayon Barda Rayon X İkinci Garademirchi village

Azerbaijan Barda Rayon Barda Rayon X Jicimli village

Azerbaijan Barda Rayon Barda Rayon X Jumalar village

Azerbaijan Barda Rayon Barda Rayon X Gazakhlar village

ix

Azerbaijan Barda Rayon Barda Rayon X Gayali viillage

Azerbaijan Barda Rayon Barda Rayon X Jeyirli village

Azerbaijan Barda Rayon Barda Rayon X Gerene village

Azerbaijan Barda Rayon Barda Rayon X Gerene village

Azerbaijan Barda Rayon Barda Rayon X Memmedli village

Azerbaijan Barda Rayon Barda Rayon X Tehle village

Azerbaijan Barda Rayon Barda Rayon X Hesenli village

Azerbaijan Barda Rayon Barda Rayon X Garademirchi village

Azerbaijan Barda Rayon Barda Rayon X

Azerbaijan Barda Rayon Barda Rayon X Gehremanli - Miressefli village

Azerbaijan Barda Rayon Barda Rayon X Yeni Aghali village

Azerbaijan Barda Rayon Barda Rayon X Yeni koshkun settlement

Azerbaijan Barda Rayon Barda Rayon X Lek village

Azerbaijan Barda Rayon Barda Rayon X Meshediibishli village

Azerbaijan Barda X

Azerbaijan Barda Rayon Barda X Barda city

Azerbaijan Baku City X X

Azerbaijan Baki Baku X

Azerbaijan Agdam Baharli X

Azerbaijan Agdam Ayakh-Karvend X

Azerbaijan Absheron Rayon X X

Azerbaijan Abseron Absheron Rayon X Pirekushkul settlement

Azerbaijan Abseron Absheron Rayon X

Azerbaijan Abseron Absheron Rayon X Jeyranbatan settlement

Azerbaijan Abseron Absheron Rayon X Nubar Settlement

Azerbaijan Qakh Rayon Amirdzhan X

Azerbaijan Barda Rayon Aliyanly X

Azerbaijan Aghsu Rayon X

Azerbaijan Agsu Aghsu Rayon X Gurcuvan village

Azerbaijan Aghdash Rayon X

Agdzhabedy X Aghgol area

Azerbaijan Agdzhabedy X Aghgol area

Azerbaijan Qazax Bol'shoy Khanuklar

X

Azerbaijan Aghjabadi Rayon Muganli X

x

Azerbaijan Agdam Uchoglan X

Azerbaijan Kurdamir Rayon Pirili X

Azerbaijan Barda Rayon Yenidashkend X

Azerbaijan Aghstafa Rayon X

Azerbaijan Mingacevir City X

Azerbaijan Naftalan City X

Azerbaijan Samukh Rayon X

Azerbaijan Şəki Şəhəri X

Azerbaijan Siazan Rayon X

Azerbaijan Sumqayit City X

Azerbaijan Khizi Rayon X

Azerbaijan Yevlakh City X

Azerbaijan Hajigabul Rayon X

Azerbaijan Beylaqan Mil X

Azerbaijan Beylaqan Sarisu X

Azerbaijan Barda Rayon Shakhvelilar X

Institutional Data

Parent (IDP Living Standards and Livelihoods Project-P122943)

Practice Area (Lead)

Social, Urban, Rural and Resilience Global Practice

Contributing Practice Areas

Cross Cutting Topics

[ ] Climate Change

[ ] Fragile, Conflict & Violence

[ ] Gender

[X] Jobs

[ ] Public Private Partnership

Sectors / Climate Change

Sector (Maximum 5 and total % must equal 100)

Major Sector Sector % Adaptation Co-benefits %

Mitigation Co-benefits %

Health and other social services Other social services 72

xi

Public Administration, Law, and Justice

Public administration- Other social services

10

Finance SME Finance 6

Education Vocational training 6

Finance Microfinance 6

Total 100

Themes

Theme (Maximum 5 and total % must equal 100)

Major theme Theme %

Social dev/gender/inclusion Conflict prevention and post-conflict reconstruction

76

Financial and private sector development

Micro, Small and Medium Enterprise support

15

Social protection and risk management

Improving labor markets 9

Total 100


Practice Area (Lead)

Social, Urban, Rural and Resilience Global Practice

Contributing Practice Areas

Cross Cutting Topics

[ ] Climate Change

[X] Fragile, Conflict & Violence

[X] Gender

[X] Jobs

[ ] Public Private Partnership

Sectors / Climate Change

Sector (Maximum 5 and total % must equal 100)

Major Sector Sector % Adaptation Co-benefits %

Mitigation Co-benefits %

Health and other social services Other social services 100

xii

Total 100

I certify that there is no Adaptation and Mitigation Climate Change Co-benefits information applicable to this project.

Themes

Theme (Maximum 5 and total % must equal 100)

Major theme Theme %

Social dev/gender/inclusion Conflict prevention and post-conflict reconstruction

40

Social dev/gender/inclusion Participation and civic engagement 20

Financial and private sector development

Micro, Small and Medium Enterprise support

20

Rural development Rural services and infrastructure 10

Urban development Other urban development 10

Total 100

Consultants (Will be disclosed in the Monthly Operational Summary)

Consultants will be required

1

I. Introduction

1. This Project Paper seeks the approval of the Executive Directors to provide an additional loan in the amount of US$66.7 million to the Republic of Azerbaijan for the scale-up and restructuring of the IDP Living Standards and Livelihoods Project (P122943, IBRD-80960). This is in response to a letter from the government dated December 11, 2015, requesting Additional Financing (AF). The proposed AF loan would extend support for the social and economic infrastructure in beneficiary internally displaced person (IDP) communities and further strengthen IDP livelihoods. The closing date of the AF would be December 31, 2020.

2. The AF activities would be fully consistent with the project development objective (PDO) of the project. The original PDO “to improve living conditions and increase the economic self-reliance of targeted internally displaced persons” remains relevant and would remain unchanged. The Results Framework and Monitoring indicators have been revised to reflect changes in the scope of project activities as well as to improve the clarity of data gathered through the project monitoring and evaluation systems. There are no changes to the implementation arrangements. The AF scales up and restructures a well-performing project, which has been rated Satisfactory for implementation progress and development objectives since November 2013 (and Moderately Satisfactory between project inception and November 2013).

II. Background and Rationale for Additional Financing in the amount of US$66.7 million

3. Strategic context. Azerbaijan has made great strides in economic growth and poverty reduction during the last decade. However, while Azerbaijan has been very successful in reducing poverty—poverty declined from 49 percent in 2001 to 5 percent in 2014—pockets of poverty still remain. The poor remain vulnerable to economic shocks.

4. Azerbaijan is currently facing economic challenges due to falling oil prices. Low oil prices could make it more difficult for the government to continue to invest in pro-poor public investment and thus, affect the quality and coverage of infrastructure provision, including water supply and sanitation and local roads. Understanding this problem, the government continues to prioritize investments in infrastructure with the support of international financial institutions.

5. IDPs constitute one of the most vulnerable segments of the population in Azerbaijan. Approximately 7 percent (around 628,000 people) of Azerbaijan’s population is displaced—forced to leave their homes and places of origin in response to the armed conflict with Armenia—making it one of the countries with the highest share of IDPs in the population. This group is particularly affected by circumstance-driven inequalities and is overrepresented among the poor. The reasons for continued vulnerability of IDPs lie both in their precarious living conditions, an issue addressed by this parent project and by substantial other government investments, as well as in the lack of opportunities for IDPs to make a living. In many cases, IDPs do not have the skills to work in the urban areas where they have resettled. In other cases, IDPs do not have the land to be able to use skills in cattle-breeding and agriculture. In yet other cases, IDPs live in remote areas with no access to markets. These constraints need to be addressed to reduce the vulnerability of this population.

6. Performance of the parent project. The World Bank and the government of Azerbaijan (GoA) have been working in partnership to assist IDP communities in Azerbaijan since the post-conflict period in the mid-1990s when the Bank provided financing for the Pilot Reconstruction Project and the IDP Economic Development Support Project. The original IDP Living Standards and Livelihoods Project loan in the amount of US$50 million was approved by the Bank on October 27, 2011, and became effective on February 9, 2012. The project is currently on track to achieve its development objective through provision

2

of funds for demand-driven community microprojects, improving housing conditions of IDPs, livelihoods support activities, and building opportunities for rural employment.

7. Implementation of the project is rated Satisfactory. To date, the project has disbursed 90 percent of loan funds (US$45.1 million) out of the total IBRD loan of US$50 million. A total of 199,601 people have benefited from the project (out of which 50 percent are women). Under Component A, 196 communities have implemented microprojects through community-driven processes. Project indicators show that over 93 percent of beneficiaries now have access to all-weather roads (96.1 percent), 24-hour water (93.3 percent), 24-hour electricity (97.5 percent), and community centers (94 percent). Under Component B, 83 collective center renovations are complete or near completion, with an additional 20 in the pipeline, out of a total of 103 planned renovations. These beneficiaries have improved access to water (91.9 percent had access to water 24 hours per day) and electricity (99.9 percent had access to 24-hour electricity), and problems with dampness and humidity have been reduced for all but 12.7 percent of households. Under Component C, the livelihoods activities have been very effective across the subcomponents. All targeted youth (1,300) have graduated from or have participated in training programs; all income-generating groups (200 communities comprising 2,239 individuals) have been formed and have already received grants; and microloans are fully disbursed (1,608 direct beneficiaries). The impacts to date are very encouraging and, among beneficiaries who are earning an income, the average increase in monthly income is 43 percent. Microfinance activities also greatly support livelihoods in IDP communities, and the repayment rate on loans is currently 100 percent.

8. Under the current project, the target of ensuring the project benefits an equal number of male and female beneficiaries has been achieved (50 percent of beneficiaries are women). This reflects dedicated and sustained efforts to reach out to women specifically across all components; these efforts will be continued under the AF. The community-driven nature of the project also lends itself well to citizen engagement activities. All microprojects are selected as a result of community engagement, priority rankings, and development of a community action plan. Under the parent project, several indicators already ensure monitoring and progress on gender targets as well as community engagement activities, such as share of female beneficiaries for various subcomponents, beneficiary satisfaction with access to and quality of investments, and percentage of beneficiaries who feel able to influence development decisions.

9. Fiduciary aspects of the project are rated Satisfactory. Procurement administration is satisfactory and procurement activities are being implemented as planned. Issues raised by the Bank are quickly addressed and no known complaints have been brought to the Bank’s attention. Similarly, financial management (FM) and disbursement arrangements are satisfactory. The project is in compliance with FM covenants: the quarterly unaudited Interim Financial Reports (IFRs) and project audit are being submitted to the Bank on time and have been found to be satisfactory. In April 2015, the Bank FM and procurement teams conducted a joint review of post review contracts under the project and no deficiencies were noted. The project has also complied with environmental safeguards policies, although capacity to manage safeguards within the project was lacking over the past year. However, a full-time safeguards specialist has now been hired and capacity to manage and supervise safeguards is now satisfactory.

Rationale for Additional Financing

10. In a letter to the Bank dated December 11, 2015, the GoA requested AF for the project. An amount of US$50 million was initially requested; this was subsequently revised to US$66.7 million in the light of additional needs identified during the appraisal process. In response to this request, this loan will provide an additional US$66.7 million to the GoA and would extend the project for four additional years, until December 31, 2020. The amount of $66.7 million includes the full financing of project activities, and does not include the $11.83 million in taxes that will be funded directly by the GoA.

3

11. The proposed AF supports scaling-up of activities initiated under the original project. Various options were considered during the preparation phase to identify the best framework for meeting the development objectives and responding to the government’s request, including preparation of a new project, financing from the state budget, and the proposed AF. Preparation of a new project was not found justifiable or necessary given that the proposed additional activities are closely related to the ongoing activities and represent a natural continuation and scale-up of the ongoing project. The scale-up has been deemed necessary given the needs of vulnerable IDPs in Azerbaijan, especially their continued need for infrastructure and livelihoods support to improve their living standards.

12. Alignment with the Bank and government strategies. The AF is included in the Azerbaijan Country Partnership Framework (CPF) FY2015–20 (Report Number: 95860-AZ) and is fully consistent with the CPF Focus Area 1: Public Sector Management and Service Delivery as well as the CPF Focus Area 2: Economic Competitiveness. The project contributes directly to Objective 1.2: Support access to, and satisfaction with, public services; Objective 1.3: Improve access to water, sanitation, and communal services; and Objective 2.2: Support enhanced access to finance for micro, small, and medium enterprises. Azerbaijan’s development strategy, ‘Azerbaijan: Vision 2020’, specifically emphasizes the need to improve housing conditions and social infrastructure for IDPs and to enhance employment opportunities for them as one of the strategic priorities of the government.

13. The proposed AF is also well aligned with the Bank’s corporate agenda of reducing poverty and enhancing shared prosperity. The project will directly improve living standards and livelihoods of IDPs, a strata of society predominantly falling into the bottom 40 percent of population. Benefits would also accrue to non-IDP populations living in proximity to IDPs, who will use social and economic infrastructure provided by the project. The gains resulting from the project can hence become a powerful tool for alleviating poverty, improving job opportunities, and boosting the incomes of the bottom 40 percent.

III. Proposed Changes

Summary of Proposed Changes

The main changes proposed in the AF are (a) additional support to construct and/or rehabilitate physical infrastructure in new IDP housing areas; (b) providing funding to operate and maintain infrastructure financed by the project; (c) increasing the scope of livelihoods activities; and (d) supporting an impact evaluation. These activities contribute to the current objective of the project. There will be an effort to consolidate the geographic scope of activities to maximize synergies between project components.

Change in Implementing Agency Yes [ ] No [ X ]

Change in Project's Development Objectives Yes [ ] No [ X ]

Change in Results Framework Yes [ X ] No [ ]

Change in Safeguard Policies Triggered Yes [ X ] No [ ]

Change of EA category Yes [ ] No [ X ]

Other Changes to Safeguards Yes [ ] No [ X ]

Change in Legal Covenants Yes [ ] No [ X ]

Change in Loan Closing Date(s) Yes [ ] No [ X ]

Cancellations Proposed Yes [ ] No [ X ]

4

Change in Disbursement Arrangements Yes [ ] No [ X ]

Reallocation between Disbursement Categories Yes [ ] No [ X ]

Change in Disbursement Estimates Yes [ X ] No [ ]

Change to Components and Cost Yes [ X ] No [ ]

Change in Institutional Arrangements Yes [ ] No [ X ]

Change in Financial Management Yes [ ] No [ X ]

Change in Procurement Yes [ ] No [ X ]

Change in Implementation Schedule Yes [ X ] No [ ]

Other Change(s) Yes [ ] No [ X ]

Development Objective/Results PHHHDO

Project’s Development Objectives

Original PDO

The objective of the Project is to improve living conditions and increase the economic self-reliance of targeted internally displaced persons.

Change in Results Framework PHHCRF

Explanation:

The Results Framework has been updated to better capture the results of new activities as well as to improve the clarity of results of ongoing activities. Some indicators have been simplified, while some (that have not been yielding useful data) will be retired. The AF will fund a firm to carry out more complex monitoring and evaluation activities, which will also design and carry out an impact evaluation covering the AF period. Because of this, the method of data collection may vary for several existing indicators. To make it possible to assess the overall impact of the project, some data may therefore be collected in two different ways: once by existing methods and once by the consulting firm. Although this involves some additional expenses, this will make it possible to gauge results for the life of the project.

Compliance PHHHCompl

Change in Safeguard Policies Triggered PHHCSPT

Explanation:

Involuntary Resettlement - OP 4.12. In the AF, Component B will support multiple infrastructure investments in selected IDP settlements constructed by the government since 2005 (so-called ‘New Settlements’). Because this may lead to increased pressure on land in communities with little landavailability, the project will trigger OP 4.12 as part of the AF. Although state-owned land is expected to be available to municipalities for these investments, informal occupants or minor impacts upon livelihoods cannot be ruled out. The Project Implementation Unit (PIU), the Social Fund for the Development of IDPs (SFDI), has developed a Resettlement Policy Framework (RPF) that has been consulted and disclosed in-country and in the Operations Portal. The SFDI will screen proposed project investments for potential impacts covered under OP 4.12 and will prepare Resettlement Action Plans (RAPs) where necessary.

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International Waterways - OP 7.50. The project will support implementation of microprojects on water supply and sanitation systems for beneficiary communities. However, the scale of the investments will be limited and will mostly consist of rehabilitation and repair of existing infrastructure (ongoing schemes). Although new connections to existing water supply systems may occur for a limited number of new investments, these are not of a nature to have adverse impacts on the quality and quantity of water flows to riparian states. An exception from OP 7.50 had been issued by the Regional Vice President for Europe and Central Asia for the original project. As the AF will continue to support the investments of the same nature and scale, such exception for the AF was also issued on January 13, 2016.

Current and Proposed Safeguard Policies Triggered:

Current (from Current Parent ISDS)

Proposed (from Additional Financing ISDS)

Environmental Assessment (OP) (BP 4.01) Yes Yes

Natural Habitats (OP) (BP 4.04) No No

Forests (OP) (BP 4.36) No No

Pest Management (OP 4.09) No No

Physical Cultural Resources (OP) (BP 4.11) No No

Indigenous Peoples (OP) (BP 4.10) No No

Involuntary Resettlement (OP) (BP 4.12) No Yes

Safety of Dams (OP) (BP 4.37) No No

Projects on International Waterways (OP) (BP 7.50)

Yes Yes

Projects in Disputed Areas (OP) (BP 7.60) No No

Covenants - Additional Financing ( Additional Financing to IDP Living Standards and Livelihoods Project - P155110 )

Source of Funds

Finance Agreement Reference

Description of Covenants

Date Due Recurrent Frequency Action

IBRD Schedule 2, Section I, Paragraph 1.

All the Borrower’s obligations referred to in Section I of Schedule 2 to the Original Loan Agreement shall apply to the execution of the Project.

CONTINUOUS

New

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Without limitations upon the provisions of paragraph 1 of this Section, prior to the carrying out of any activities to be financed with the proceeds of the Loan, the Borrower shall and shall cause the Project Implementing Entity to: (a) amend the Subsidiary Agreement, and (b) update the Operational Manual, all for purposes of this Loan and in a manner satisfactory to the Bank

New


The Borrower shall ensure that Part B.2 of the Project is carried out in accordance with the provisions of the RPF

CONTINUOUS

New

Conditions PHCondTbl

Source Of Fund Name Type IBRD Condition of Effectiveness Effectiveness Description of Condition The Project Agreement has been amended

PHCondTbl

Source Of Fund Name Type IBRD Condition of Effectiveness Effectiveness

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Description of Condition The Subsidiary Agreement has been amended in a manner acceptable to the Bank

PHCondTbl

Source Of Fund Name Type IBRD Condition of Effectiveness Effectiveness Description of Condition The Operational Manual has been updated in a manner acceptable to the Bank

Risk PHHHRISKS

Risk Category Rating (H, S, M, L)

1. Political and Governance Moderate

2. Macroeconomic Moderate

3. Sector Strategies and Policies Moderate

4. Technical Design of Project or Program Low

5. Institutional Capacity for Implementation and Sustainability Low

6. Fiduciary Moderate

7. Environment and Social Moderate

8. Stakeholders Moderate

9. Other Moderate

OVERALL Moderate

Finance PHHHFin

Loan Closing Date - Additional Financing ( Additional Financing to IDP Living Standards and Livelihoods Project - P155110 )

Source of Funds Proposed Additional Financing Loan Closing Date

International Bank for Reconstruction and Development

31-Dec-2020

Change in Disbursement Estimates (including all sources of Financing)PHHCDE

Explanation:

Expected disbursements of the AF loan are indicated below.

Expected Disbursements (in USD Million)(including all Sources of Financing)

Fiscal Year 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Annual 5.00 15.35 30.80 15.55 0.00 0.00 0.00 0.00 0.00 0.00

Cumulative 5.00 20.35 51.15 66.70 66.70 0.00 0.00 0.00 0.00 0.00

Allocations - Additional Financing ( Additional Financing to IDP Living Standards and Livelihoods Project - P155110 )

Source of Fund

Currency Category of Expenditure

Allocation Disbursement %(Type Total)

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Proposed Proposed

IBRD USD

Goods, works, non-consulting services, and consultant services (including audits), Small Grants, Micro-Credits, Training

66,533,250.00 100.00

IBRD USD Front-end Fee 166,750.00 0.00

Total: 66,700,000.00

Components PHHHCompo

Change to Components and Cost PHHCCC

Explanation:

The project will continue to have four components, with some changes made to each component as described below:

Component A: Microprojects (AF: US$16.5 million; parent project: US$15 million). This component will continue to finance demand-driven economic and social infrastructure investments in communities with a significant proportion of IDPs. Microprojects may include (a) repair or rehabilitation of physical infrastructure (for example, water supply, power supply, access roads, drainage systems) and (b) repair or rehabilitation of social infrastructure, such as schools and health centers. The component will also continue to finance community mobilization and outreach for micro-project proposal development. The key changes to component design are the following: (a) the component will expand in geographic scope and (b) while the ceiling for the value of infrastructure supported will remain at US$250,000, the SFDI board approval will be sought for projects above US$150,000. In the parent project, the ceiling for the SFDI board approval is US$100,000. Increasing the size of projects requiring board approval will help avoid delays resulting from a high volume of reviews and enable the board to focus on the largest investments. Community contributions will continue to be set at 3 percent of the total value for the component. Operations and maintenance (O&M) activities will be significantly strengthened under the AF as will community engagement throughout the subproject implementation cycle.

Component B: Housing Renovation and Social and Economic Infrastructure for IDP Settlements(Original Component Title: Housing Renovation. AF: US$22.53 million; parent project: US$33 million). Component B will undergo the most changes in scope during the AF stage. In the parent project, the component financed the renovation of IDP collective centers that were in a state of disrepair. The GoA, however, is now aiming to resettle a large number of people currently living in IDP collective centers to ‘New Settlements’ and has therefore asked for this component to change focus. The GoA will be financing the ‘New Settlements’ using other financing but has stated that there is a great need to rehabilitate social and economic infrastructure in the ‘New Settlements’ built before 2005. Component B under the AF will therefore finance multiple small to medium-size infrastructure investments in each of approximately 30 locations, as contrasted with Component A where only one investment is possible at any one time. While any community with a significant share of IDP population is eligible for Component A, under Component B, only investments in the ‘New Settlements’ are eligible for funding. Investments under Component B will include repair of social infrastructure (for example, schools, health care centers) and repair of other physical infrastructure (for example, access roads, water supply). Selection will be based on an infrastructure needs assessment analyzing (a) the extent of infrastructure needs in each settlement and (b) whether addressing

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specific infrastructure needs is likely to promote economic development. During project implementation, the SFDI will create or revitalize community groups, present to them the assessment of infrastructure needs in their community, and then, help them develop a final priority list of infrastructure investments to be supported by the project. Although communities will be part of the process of defining the final list of infrastructure, investments will be selected from a needs assessment generated menu, contrary to Component A where communities self-select microprojects.

Component B will also finance ongoing O&M of all infrastructure supported by the project. In parallel, this component will also provide technical assistance and training to strengthen the GoA’s capacity to operate and maintain IDP-focused infrastructure, including all investments financed under the project. The inclusion of these new activities is based on lessons learned during the implementation of the parent project, where maintenance that took place was not of optimal quality.

Component C: Livelihood Support (AF: US$20 million; parent project: US$11 million). This existing component will be scaled up and expanded geographically. Targeting for the component will also be modified to be more integrated with Components A and B—the component will specifically target communities benefitting from infrastructure investments. In addition, a new subcomponent will be added to Component C that will focus on providing integrated economic support to beneficiaries. The component will,therefore, comprise four subcomponents: (a) Youth Training and Business Development; (b) Income Generating Activities; (c) Provision of Microcredit for IDPs; and (d) (new) Integrative Economic Support Pilot. Activities under each subcomponent are as follows:

(a) Youth Training and Business Development: This subcomponent will continue to provide skills training (technical and computer skills) to young people. The subcomponent supports skills training graduates with tools that allow them to start income generating activities. To promote integration of IDPs into host communities and expand business opportunities, an annual youth workshop will be organized to bring together beneficiaries of the project with other youth entrepreneurs from around the country for mutual learning and exchange.

(b) Income Generating Activities: This subcomponent will continue to support vulnerable IDPs to form groups to carry out income generating activities. Income generation groups that have been successful in developing activities with previous project financing will also be encouraged to apply for a second round of support, which can finance groups to add value to their products or to be able to benefit from more complex technology for income generation.

(c) Provision of Microcredit for IDPs: Microfinance institutions that carry out activities under this subcomponent currently select IDP and non-IDP beneficiaries (80 percent IDP) to receive up to US$3,000 per group or US$1,000 per individual in initial microfinance funds to be used toward productive business activities. The repayment rate for these microloans is currently 100 percent, which indicates both that microfinance institutions have been able to successfully select viable enterprises as well as that there is scope to encourage microfinance institutions to take greater risk by targeting more vulnerable individuals. Under the AF, this subcomponent will focus increasingly on vulnerable individuals. Microfinance institutions will be required to ensure that at least 50 percent of the recipients of microloans have not received a loan in the past, and that they have an annual income that does not exceed US$1,200. Additional technical advice on micro and small businessdevelopment will be offered to these vulnerable loan takers to ensure sound utilization of loans and promote business development. About 80 percent of recipients of microloans will continue to be IDPs. These changes are expected to significantly increase the poverty reduction impacts of this subcomponent, which although currently performing well, may not be benefitting the core target group for this project.

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(d) Integrative Economic Support Pilot: This subcomponent will work in the ‘New Settlements’supported under Component B and will provide beneficiaries’ access to integrated economic support. Under this subcomponent, residents of the ‘New Settlements’ will be eligible to apply for training and business development support to benefit from income generating activities and the beneficiaries of these two activities will also be eligible to receive microcredit. This pilot will be carefully evaluated to make it possible to see whether integrated support significantly boosts income generation and sustainability of livelihoods.

Component D: Project Management, Implementation Support, and Capacity Building (AF: US$7.5 million; parent project: US$7 million). This component will finance project management and capacity building as well as monitoring and evaluation activities. The only change expected under this component is the financing of an impact evaluation. Currently, the project has successfully gathered data on outputs, but there are indications that broader outcomes and impacts of the project are not being successfully captured. Because of this, a firm will be competitively selected to carry out an impact evaluation. The firm hired to carry out this evaluation will also take over some of the more complex monitoring and evaluation activities currently carried out by the PIU, also making it possible for the PIU staff currently carrying out these activities to focus on other aspects of project implementation.

The following breakdown does not include the front-end fee of US$166,750. (Note: The actual total cost for the infrastructure support to IDP communities component is US$22,533,250, rounded to US$22.53 million).

Current Component Name

Proposed Component Name

Current Cost (US$M)

Proposed Cost (US$M)

Action

Micro-projects Microprojects 15.00 16.50 Revised

Housing Renovations

Housing Renovation and Social and Economic Infrastructure for IDP Settlements

33.00 22.53 Revised

Livelihood Support Livelihood Support 11.00 20.00 Revised

Project Management and Capacity Building

Project Management, Implementation Support, and Capacity Building

7.00 7.50 Revised

Total: 66.00 66.53

Other Change(s) PHHHOthC PHImplemeDel

Implementing Agency Name Type Action

Change in Implementation Schedule PHHCISch

Explanation:

The Project closing date is extended until 31 December 2020. In line with this, an additional mid-term review will be rescheduled at implementation mid-point.

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Appraisal Summary PHHHAppS

Economic and Financial Analysis PHHASEFA

Explanation: The analysis carried out for the preparation of this AF indicates significant positive economic and financial impacts over a period of 15 years. The summary of the analysis is as follows:

Component A: The overall costs of Component A are US$36.31 million. The component will benefit 314,401 IDPs and host community residents. In its most likely scenario, and including the AF, the net present value of Component A is expected to be US$122.65 million.

Component B: The overall costs of Component B are US$64.77 million. The component will benefit 73,717 people. Under the parent project, the net present value of Component B was calculated to be negative, at −US$19.89 million. However, once the AF activities are added, the net present value of this component rises to US$20.12 million.

Component C: The overall costs of Component C are US$39.92 million. The component will benefit 16,233 people. The net present value of Component C is US$216.15 million under the most likely scenario.

Overall, under the most likely scenario, the project’s net present value is US$393.95 million.

The sensitivity analysis carried out found that changes in +/−10 percent of the value of only three assumptions led to a change in net present value of over 5 percent. The same change in other assumptions rendered a change of less than 4 percent (not critical).

The full economic and financial analysis is included in the project file.

Technical Analysis PHHASTA

Explanation:

Systems are currently being strengthened under the parent project to boost the quality of construction, supervision, and O&M of infrastructure investments. These systems will continue to ensure the quality and sustainability of infrastructure supported by the project during the AF stage.

Social Analysis PHHASSA

Explanation:

OP/BP 4.12 - Involuntary Resettlement is triggered on a precautionary basis as the type and location of new project activities under Component B are not yet known, and the type and scale of civil works and land acquisition are still to be determined. An RPF has, therefore, been prepared and RAPs will be prepared as needed. To mitigate social risks and help improve project outcomes, the AF places renewed emphasis on participatory decision making, beneficiary feedback mechanisms, and entry points for citizen engagement.

Environmental Analysis PHHASEnvA

Explanation:

The environmental due diligence procedures and processes envisaged under the original Environmental and Social Management Framework (ESMF), will remain relevant for the scope of AF. However, the

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ESMF has been updated to accommodate extended geographical coverage and address anticipated impacts of new income generating activities proposed under the AF.

Risk PHHASRisk

Explanation:

The overall risk rating for the project is Moderate. It remains unchanged from the parent project. Despite the recent devaluation of the New Azerbaijani Manat, strong support from the GoA for livelihoods and employment will help ensure continued investments into this sector. The parent project implementation has also been rated as Satisfactory for over two years and the AF builds on the successful experience of this project. The implementation review of the parent project indicates that the maintenance that took place was not of optimal quality. Component B will therefore also finance ongoing O&M of all infrastructure supported by the project and provide technical assistance and training to strengthen the GoA’s capacity to operate and maintain IDP-focused infrastructure.

IV. Appraisal Summary

A. Economic Analysis

14. An analysis carried out as part of preparation of this AF indicates significant positive economic and financial impacts. As part of the analysis, the project costs were identified and these were compared to the expected benefits of investments over a period of 15 years, starting in 2013, when parent project activities began and ending in 7 years after the completion of activities under the AF. The analysis used existing project monitoring and evaluation data and other project records to determine actual project costs, identify actual accrued benefits from 2013 to 2015, and then, make assumptions about other benefits that are linked to project activities. The key assumptions applied to the analysis include the following:

A 6 percent discount rate

Income generated and savings would grow at a rate of 10 percent. (This assumption comes from the 18 percent compound average growth rate of income in Azerbaijan between 2004 to 2014, as reported by the State Statistical Committee (http://www.stat.gov.az), and the fact that the interest rate of savings saved as deposits is between 10–12 percent.)

15. The results of the analysis are as follows:

Component A: The overall costs of Component A are US$36.31 million. The component will benefit 314,401 IDPs and host community residents over 15 years. Benefits of this component accrue because of time savings, lower travel costs, lower repair costs, and improved health resulting from infrastructure investments. In its most likely scenario, and including the AF, the net present value of Component A is expected to be US$122.65 million.

Component B: The overall costs of Component B are US$64.77 million. The component will benefit 73,717 people over 15 years. Calculations for Component B differ for the parent project, which funded the renovation of collective centers, and for Component B under the AF, which funds infrastructure investments in the ‘New Settlements.’ Under the parent project, the net present value of Component B was calculated to be negative, at −US$19.89 million. This is because IDPs in collective centers are mostly economically inactive, so savings in time do not bring about economic benefits, and because savings in the cost of energy or water do not accrue for this population, as these IDPs do not pay for utilities. However, once the AF activities are added, the net present value of this component rises to

13

US$20.12 million. This was calculated using the same assumptions as for Component A because infrastructure investments are likely to bring about similar benefits to those living in mixed communities or in the ‘New Settlements.’

Component C: The overall costs of Component C are US$39.92 million. The component will benefit 16,233 people over 15 years. For this component, there are three additional important assumptions: (a) a 30 percent increase in assets for those making a living from livestock, (b) a 30 percent increase in income for income generation groups, and (c) a 25 percent increase in income for microcredits. These assumptions are expected to be conservative because the project monitoring data indicates that the income generation groups saw their income rise by 43 percent and beneficiaries of microcredits saw their income rise by 52.9 percent. More modest assumptions would not make sense as the income generated for both income generation groups and microcredit beneficiaries come mainly from livestock, which increase incrementally. The more conservative estimate for microloans comes from the potential effect of the credit burden on increases in income. The assumption for the skills development subcomponent is that the AF will achieve the same results as the parent project. Using these assumptions, the net present value of Component C will be US$216.15 million under the most likely scenario.

16. The following table summarizes the results of the analysis for the three components over 15 years:

Project Component

Project Costs* (US$,

millions)

Project Benefits

(US$, millions)

Net Present Value (US$,

millions)

Internal Rate of Return

(%)

Number of Beneficiaries,

current project as of January 7, 2016 (persons)**

Number of Beneficiaries, including AF

(persons)

Component A 36.31 280.79 122.65 28 164,401 314,401 Component B 64.77 167.95 20.12 9 28,717 73,717 Component C 39.92 613.55 216.15 30 6,483 16,233 Total 156.92 1,062.29 393.95 20 199,601 404,351 Note: *Project costs are the sum of the allocated funds for the current project and requested costs for the new one; ** Beneficiaries are IDP households and their members, as well as neighbors in areas affected by the project. Direct beneficiaries of microprojects having access to project's products are considered as a project community (this can be part of the village, not necessarily the whole village if not reached by the project resources). *** The project also bears administrative (management) costs (US$8.42 million under the parent project and US$7.50 under the AF), which are not included under the Components A, B and C.

17. A sensitivity analysis was carried out to determine what would happen if key assumptions were not to hold true. The net present value changed over 5 percent only for three assumptions, when 10 percent was added to or subtracted from them. The same change in other assumptions rendered a change of less than 4 percent (not critical).

Variable (Variation in Assumptions by 10%)

Variation of NPV due to +/− 10% change in assumption

% change Impact

Discount rate +10 −8.27 Critical

−10 8.90 Critical

Annual increase in assets (livestock) for Subcomponent C(b): Income Generation Program (IGP)

+10 8.12 Critical

−10 −6.17 Critical

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Variable (Variation in Assumptions by 10%)

Variation of NPV due to +/− 10% change in assumption

% change Impact

Impact of the IGP on increase of income +10 6.77 Critical

−10 −5.57 Critical

Note: NPV = Net Present Value.

18. The analysis also points out that the AF contributes 62 percent to the project benefits in the most likely scenario. In addition, the effect of AF covers only 11 years (15 years minus 4 years of the current project). The benefits of the project would be higher if calculated for an additional 4 years due to impact of incremental growth.

19. Finally, the analysis points to unquantified potential benefits. Increases in growth and profits of businesses as an effect of improved access to 24-hour electricity, water, and road infrastructure have not been calculated and neither have the impacts of improved schools and kindergarten facilities on learning of children, and consequently, better productivity in the labor market, and so on. Quantifying these benefits would increase the value of the project as well.

B. Technical

20. Systems are currently being strengthened under the parent project to boost the quality of construction, supervision, and O&M of infrastructure investments. These systems will continue to ensure the quality and sustainability of infrastructure supported by the project during the AF stage. This is essential considering the large number of infrastructure subprojects expected to take place during the AF.

21. Technical scope of works. By the close of the current loan agreement, the project will have financed more than 196 microprojects that support the living standards of IDPs, particularly those living in rural areas of the country. The AF will support an additional 200 microprojects under Component A and approximately 120 investments in 30 or so ‘New Settlements’ under Component B. These investments will mainly consist of rehabilitation works but may also include some new construction. In the past, microproject types have included roads (and accompanying drainage structures), potable water facilities, schools and kindergartens, community centers, health points, irrigation facilities and on-grid electricity facilities. Similar projects are expected to be financed in the AF, with the caveat that Component B projects are more likely to be larger in scale and that economic infrastructure (roads, irrigation, energy) is more likely to be financed. The AF will also allocate funds for O&M of infrastructure supported under the project, which will require some technical supervision.

22. Technical staffing. A technical team within the SFDI will oversee all planning and engineering aspects of the project. The technical team will be headed by a senior technical manager reporting directly to the deputy director. A senior technical specialist will report to the senior technical manager and will supervise four regional technical coordinators (based outside of Baku) as well as the appraisal team. The regional technical coordinators will be responsible for the work of site supervision engineers, who will in turn be responsible for quality of civil works and work zone safety. Together, the team will be responsible for overseeing the individual project feasibility studies, the design process, tendering of works contracts, and civil works. The team will also be responsible for implementing comprehensive O&M strategies for all socioeconomic infrastructure supported by the project.

23. Contracting. To ensure technical quality, the tendering process will involve the development of detailed bills of quantity that specify work needs and performance expectations to the greatest extent

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possible. Each contract will have a minimum six-month defects and liability clause, which will be leveraged by using an initial punch list inspection before the release of the 95th percentile payment, a three month inspection once the asset is in service, and a final inspection before the final payment and release of any bank guarantees.

C. Financial Management

24. The current project has a strongly performing PIU, and the AF proposes to use the same implementation, procurement, and FM arrangements. The proposed AF would not require changes in the FM arrangements. The FM functions under the proposed AF, including flow of funds, staffing, accounting, reporting, and auditing, will remain under the responsibility of the PIU at the SFDI, as under the parent project. FM arrangements of the parent project have been reviewed periodically as part of project supervision and have been found satisfactory. The last implementation support mission, including FM review, was held in April 2015. Sound internal control procedures are in place. The client is in compliance with the FM covenants: unaudited IFRs have been submitted on a regular and timely basis, the project audit reports have been received by their due date, and the auditor has given an unqualified opinion on the project financial statements with no serious internal control issues in the management letters. The overall FM risk for the project remains Moderate.

25. Audit arrangements similar to the arrangements under the parent project will be adopted for the proposed AF. The audit will be conducted by an independent private auditor in accordance with terms of reference acceptable to the Bank and procured by the PIU. The current format and components of the project financial statements will remain the same. The annual audited project financial statements will be submitted to the Bank within six months after the end of each reporting period. The audited financial statements will be posted on the SFDI website within one month of the receipt of audited reports from the auditor. In addition, following the Bank’s formal receipt of the financial statements from the recipient, the Bank will make them available to the public in accordance with the Bank Policy on Access to Information for Bank-financed operations. The cost of the audit will be financed from the proceeds of the loan. Project management oriented unaudited IFRs will be used for the proposed AF monitoring and supervision. The existing IFR formats will be used and the PIU will produce a full set of IFRs every quarter throughout the life of the project and will submit them to the Bank no later than 45 days after the calendar quarter end.

26. Disbursement. The proposed AF will follow the flow of funds and disbursement arrangements established under the original project, that is, reimbursement, direct payment, advances, and special commitments, including the use of Statement of Expenditure procedures. A separate designated account for IBRD funds under the AF loan will be opened in a commercial bank on terms and conditions acceptable to IBRD. It was agreed to set the Ceiling of Advances to the designated account at US$6 million to ensure quick and efficient disbursements for the proposed AF.

D. Procurement

27. Procurement risk assessment. A procurement assessment carried out by the Bank’s procurement specialist found three potential risks: (a) the procurement environment may be affected by problems related to governance and corruption; (b) as the project involves participation of communities in Component C, addressing procurement issues at that level may be challenging due to lack of capacity among communities; and (c) procurement capacity might not be sufficient to accommodate new packages under the AF.

28. Risk mitigation. The following measures were agreed to mitigate the remaining risks and maintain the implementing team’s capacity. The project procurement risk following application of mitigation measures is Moderate. Risk mitigation measures were discussed with the SFDI during project appraisal and it was agreed that they will be included in the project Operational Manual (OM).

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(a) The procurement section of the OM will be updated by the SFDI to meet the specific needs of the new project, which, among other things, will elaborate on the roles and responsibilities in the management and coordination of the procurement process, including procurement arrangements regarding community participation in procurement, preparation of terms of reference and technical specifications, evaluation, establishment and appointment of evaluation committees, conflict of interest mitigation measures, record keeping, contract management, a complaint handling mechanism, and so on.

(b) The Bank’s procurement specialist assigned to the project will provide the team with a full set of the most recent procurement documents, including but not limited to Procurement and Consultant Guidelines, standard and sample bidding documents, proposal, evaluation report documents, and so on.

(c) The SFDI will hire an additional procurement assistant with adequate experience in procurement in the Bank-financed projects. The assistant will be hired on a full-time basis for maintaining and further streamlining procurement transactions under the upcoming project. The selection will be based on procedures outlined in the Consultant Guidelines.

E. Social (including Safeguards)

29. The social impacts of the project are expected to be positive. The project will improve community infrastructure and services for IDPs through microprojects targeting urgent basic needs and its livelihood support component, which will also be expected to contribute to improved living standards for beneficiaries.

30. Safeguards. OP/BP 4.12 - Involuntary Resettlement is triggered on a precautionary basis as the type and location of new project activities under Component B are not yet known, and the type and scale of civil works and land acquisition are still to be determined. This would likely occur on publicly owned land but might entail private land acquisition. An RPF has, therefore, been prepared and will be followed by all project activities. The RPF was consulted with stakeholders and disclosed publicly, in-country on the SFDI website on December 18, 2015, and through the Bank’s Operations Portal on January 4, 2016. Site-specific RAPs will be prepared and implemented before commencement of works at any site where resettlement, land use, or acquisition is required. Potential impacts are limited to Component B since, as was the case under the parent project, under Component A, no microprojects that involve land acquisition (permanent or temporary) or resettlement will be approved, and no civil works are planned under Components C and D. Screening is carried out for all physical investments to ensure impacts covered under OP 4.12 are identified. As the SFDI does not have significant experience with oversight of OP/BP 4.12 (Involuntary Resettlement), additional capacity has been retained for the project in the form of a dedicated full-time safeguards consultant (combining environmental and social safeguards) and safeguards will be closely supervised and supported by the Bank.

31. Citizen engagement. To mitigate social risks and help improve project outcomes, the AF places renewed emphasis on participatory decision making, beneficiary feedback mechanisms, and entry points for citizen engagement in the current project. The OM will be updated by effectiveness to reflect the lessons learned to date. Key changes include the following:

(a) Community consultations to determine the priority microprojects will be conducted, wherever possible, separately with women and men, and reports will include the priority rankings of both groups. Communities will be eligible to apply for more than one microproject to ensure potentially different needs are met. Furthermore, proposed microprojects will also need to demonstrate proactive steps to ensure inclusion of the elderly, youth, and people living with a disability in the consultation process (for example, at times and in forms and places that

17

enable participation). Proposed investments should include measures to facilitate access of people with limited mobility and/or with a disability, where relevant.

(b) The periodic surveys measuring impact will include open-ended questions to capture feedback on the project as a whole and on the relevant specific investment/subcomponent in particular.

(c) The existing grievance redress mechanism (GRM) will further be strengthened and its use as a monitoring tool systematized. Questions, comments, and complaints will continue to be proactively collected during interactions with communities and beneficiaries under all components. These will be centrally analyzed by a dedicated staff member within the SFDI to facilitate monitoring of the project and the reporting back to communities regarding the impact of their feedback. For example, the GRM will be aggregated at the project level and quarterly reports shared with beneficiaries through the SFDI website and through leaflets during community mobilization activities.

(d) A communication strategy will be developed to systematize the ongoing and planned outreach activities and ensure these are tailored to the needs and interests of different stakeholder groups. This includes mechanisms for two-way communications (for example, web portal, brochures with contact details, and information about the GRM) and for closing the feedback loop (that is, reporting back on the result of feedback to beneficiaries).

32. Gender. The efforts to ensure effective participation of women in the decision-making process and access to the benefits of the project will be continued. Overall, women represent 50 percent of total project beneficiaries (breakdown by component is 50.4 percent, 47.2 percent, and 56.5 percent for Components A, B, and C respectively). Opportunities to further improve the gender sensitivity of the project were identified during a workshop with the SFDI and implementing partners, through the preparatory studies (on Component B and livelihoods), through a report on Gender and Sustainable Livelihoods that focused on providing recommendations to this project, and through consultations with beneficiaries themselves. Gender norms and gendered structural inequalities were identified that prevent women from benefitting equally from the project. Key areas that the project will support to address these inequalities include (a) systematic and meaningful participation of women in community consultations across all components; (b) strengthening of female role-model and leadership roles in community consultations and livelihood activities; and (c) specific support to female entrepreneurs as part of the microfinance subcomponent. Credit unions will have to demonstrate that lack of collateral is not a hindrance to lending to women and a target of 20 percent of loans going to women has been set. To facilitate monitoring of gender impacts, all indicators are disaggregated by gender whenever possible as part of the project quarterly reports, as well as in key indicators related to participation as part of the Results Framework.

F. Environment

33. The environmental aspects of the original project have been governed by the provisions of the ESMF. The environmental due diligence procedures and processes envisaged under the original ESMF will remain relevant to the scope of AF. However, the ESMF has been updated to accommodate extended geographical coverage and address anticipated impacts of new income generating activities proposed under the AF. The updated ESMF has been redisclosed in selected locations of the project area and on the SFDI website on January 5, 2016. The detailed minutes of public consultation meetings have been duly recorded and enclosed in the updated ESMF.

34. The capacity of the SFDI PIU has been recently reinforced though hiring a full-time designated safeguards specialist who will be responsible for ensuring proper environmental and social management of the project and will undertake regular monitoring and reporting to PIU management and the Bank.

18

G. Implementation Arrangements

35. Implementation arrangements during the AF will stay the same. However, small changes will be made to staffing to improve the clarity of roles and the quality of supervision. During the AF, the staffing structure will be as follows:

SFDI’s director will have overall authority over project activities and be supported by a deputy director.

A chief accountant and a senior technical coordinator will report directly to the deputy director.

A procurement team, consisting of a deputy manager for procurement and two assistants, will report to the deputy director.

A senior technical specialist will report to the senior technical coordinator and will supervise four regional technical coordinators (based outside of Baku) as well as the appraisal team. Two additional senior manager positions will be created, reporting to the deputy director: (a) A senior community mobilization manager will be responsible for information sharing, community mobilization, monitoring and evaluation, and safeguards activities and (b) a senior livelihoods manager will be responsible for implementation of all activities under Component C. Four regional community mobilization coordinators will report to the senior community mobilization manager and will be responsible for supervising all nontechnical aspects of the project.

V. World Bank Grievance Redress

36. Communities and individuals who believe that they are adversely affected by a Bank supported project may submit complaints to existing project-level GRMs or the Bank’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed to address project-related concerns. Project affected communities and individuals may submit their complaint to the Bank’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of Bank’s noncompliance with its policies and procedures. Complaints may be submitted at any time after concerns have been brought directly to the Bank's attention and the Bank management has been given an opportunity to respond. For information on how to submit complaints to the Bank’s corporate GRS, please visit http://www.worldbank.org/GRS. For information on how to submit complaints to the Bank’s Inspection Panel, please visit www.inspectionpanel.org.

19

Annex 1: Results Framework

Project Name:


Project Stage: Additional Financing Status: DRAFT

Team Leader(s):

Michelle P. Rebosio Calderon Requesting Unit:

ECCU3 Created by: Rebecca Emilie Anne Lacroix on 17-Aug-2015

Product Line: IBRD/IDA Responsible Unit:

GSU03 Modified by: Rebecca Emilie Anne Lacroix on 19-May-2016

Country: Azerbaijan Approval FY: 2017

Region: Europe and Central Asia Lending Instrument:

Investment Project Financing

Parent Project ID: P122943 Parent Project Name:

IDP Living Standards and Livelihoods Project (P122943)

Project Development Objectives

Original Project Development Objective - Parent:

The objective of the project is to improve living conditions and increase the economic self-reliance of targeted internally displaced persons.

Proposed Project Development Objective - Additional Financing (AF):

No change

Results

Core sector indicators are considered: Yes Results reporting level: Project Level

Project Development Objective Indicators

Status Indicator Name Core Unit

of Measure

Baseline Actual

(Current) End Target

Revised Direct project beneficiaries

Number Value 0 199,601 371,000

Date 09-Feb-2012 15-Oct-2015 31-Dec-2020

Comment – – End target and date modified to reflect AF

No Change Female beneficiaries Percentage

Value 0 50.10 50 Sub Type

20

Supplemental

New

Percentage of households with increased access to basic rural infrastructure

Percentage Value 77.00 95.60 30.00

Date 15-Apr-2011 15-Oct-2015 31-Dec-2020

Comment – – Improvement in relation to the new baseline to be established as part of the impact evaluation

Revised

Percentage of households who are satisfied with the quality of basic rural infrastructure


Date 15-Apr-2011 15-Oct-2015 31-Dec-2020


Marked for Deletion Percentage increase in access to all-weather rural roads


Sub Type Date 15-Apr-2015 15-Oct-2015 30-Jun-2016

Breakdown Comment – – Original target exceeded

Marked for Deletion Percentage with access to 24-hour water




Marked for Deletion Percentage with access to 24-hour electricity




Marked for Deletion Percentage with access to community centers


Sub Type Date 25-Sep-2014 15-Oct-2015 30-Jun-2016


Revised Changes in housing deficiencies: satisfaction with housing condition


Date 25-Sep-2014 15-Oct-2015 31-Dec-2020

Comment – – Original target exceeded

Marked for Deletion Percentage Value 93.50 15.20 25.00


21

Percentage of households suffering from dampness


Marked for Deletion

Percentage of households with energy-efficient doors and windows




Marked for Deletion Percentage with access to 24-hour water




Marked for Deletion Percentage with access to 24-hour electricity




New

Improvement in the quality and sustainability of IDP livelihoods


Date 15-Oct-2015 31-Dec-2020


Marked for Deletion

Targeted beneficiaries whose main source of household income is self-generated


Date 15-Apr-2015 15-Oct-2015 30-Jun-2016

Comment – – Original target exceeded

Intermediate Results Indicators

Status Indicator Name Core Unit of

Measure Baseline

Actual (Current)

End Target

Revised Number of completed subprojects (disaggregated by type)

Number Value 0 196 490

Date 09-Feb-2012 15-Oct-2015 31-Dec-2020

Comment – – –

Revised

Number of people benefitting from access to improved infrastructure

Number Value 0 153,512 313,000

Date 09-Feb-2012 15-Oct-2015 31-Dec-2020

Comment – – –

22

(disaggregated by type; also disaggregated by direct and indirect)

Revised Number of collective centers that have been renovated by the project


Date 09-Feb-2012 11-Jan-2016 31-Dec-2020

Comment – – –

New

Grievances registered related to delivery of project benefits addressed (percentage)

Percentage Value – 100.00 100.00

Date 15-Apr-2015 15-Oct-2015 31-Dec-2020

Comment – – –

New

Grievances registered related to delivery of project benefits that are addressed (number)

Number

Value 0 15 60 Sub Type

Supplemental

Revised Increase in income of direct project beneficiary households


Date 15-Apr-2011 15-Apr-2015 31-Dec-2020

Comment – – –

New Increase in income of direct project beneficiary households

Number Value – – –

Date – – 31-Dec-2020

Comment TBD – TBD + 20% (in AZN)

Revised Number of targeted beneficiaries who gain employment

Number Value 0 3,906 9,600

Date 15-Apr-2011 15-Oct-2015 31-Dec-2020

Comment – – –

New Number of targeted beneficiaries who gain employment - female


Sub Type Date 15-Apr-2011 15-Oct-2015 31-Dec-2020

Breakdown Comment – – –

Revised Increased value of assets owned by direct beneficiaries


Date 09-Feb-2012 15-Apr-2015 31-Dec-2020

Comment – – TBD + 10%

New Percentage Value 0.00 – 20.00

23

Percentage increase in profit of microloan beneficiary businesses

Date 15-Apr-2011 – 31-Dec-2020

Comment – – –

Revised Number of active loan accounts - microfinance


Date 09-Feb-2012 15-Apr-2015 31-Dec-2020

Comment – – –

New Percentage of active loan accounts held by vulnerable IDPs

Percentage

Value 30.00 30.00 50.00 Sub Type

Supplemental

New Percentage of active loan accounts held by women

Percentage

Value – – 20.00 Sub Type

Supplemental

Revised

Percentage of project-supported institutions that are reporting on this indicator

Percentage

Value 0.00 100.00 100.00 Sub Type

Supplemental

Marked for Deletion Community contribution in the total project costs (%)


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Revised Total community contribution (US$)

Amount(US$)

Value 0.00 531,546.66 500,000.00 Sub Type

Supplemental

Marked for Deletion

Conflict-affected people receiving benefits in 1st year of project effectiveness

Number Value 0 34,285 25,000

Date 9-Feb-2012 17-Apr-2014 17-Apr-2014

Comment – – –

Revised

Conflict-affected people receiving benefits in 1st year of project effectiveness - female

Number Value 0 16,663 12,500

Sub Type Date 9-Feb-2012 17-Apr-2014 17-Apr-2014

Breakdown Comment – – –

Marked for Deletion Percentage Value 0.00 41.00 35.00

24

Percentage of active loans to women - microfinance

Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Revised


Percentage

Value 100.00 100.00 100.00 Sub Type

Supplemental

Marked for Deletion Number of active microsavings accounts


Date 09-Feb-2012 15-Oct-2015 30-Jun-2017

Comment – – –

Revised


Percentage

Value 0.00 100.00 100.00 Sub Type

Supplemental

Marked for Deletion Number of active loan accounts - microfinance


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion

Increase in targeted beneficiaries rating housing conditions as good


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion Percentage of active loans to women - microfinance


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion Number of new social institutions formed under the project


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion

Percentage of targeted beneficiaries who feel able to influence development decisions


Date 11-Apr-2014 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion Number Value 0 2,178 1,500

25

Note: TBD = To be determined.

Number of new businesses and microenterprises created under the project, which are generating profit after one year

Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion

Percentage of targeted beneficiaries who feel socially excluded in the wider society


Date 11-Apr-2014 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion Number of members of social institutions


Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion

Beneficiaries rating access to service/utility/infrastructure as good


Date 11-Apr-2014 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion

Beneficiaries rating quality of service/utility/infrastructure as good


Date 11-Apr-2014 15-Apr-2015 30-Jun-2016

Comment – – Moved to PDO indicator section

Marked for Deletion

Percentage of targeted beneficiaries whose social map of trusted relations includes IDPs as well as non-IDPs


Date 11-Apr-2014 15-Apr-2015 30-Jun-2016

Comment – – –

Marked for Deletion Amount of monthly household income

Amount (US$) Value 0.00 1,558.00 1,000.00

Date 09-Feb-2012 15-Apr-2015 30-Jun-2016

Comment – – –

26

Project Development Objective (PDO): To improve living conditions and increase the economic self-reliance of targeted internally displaced persons

PD

O L

evel

Res

ult

s In

dic

ator

s

Cor

e

Un

it o

f M

easu

re

Bas

elin

e O

rigi

nal

Pro

ject

S

tart

(20

11)

Pro

gres

s to

Dat

e (2

015)

Cumulative Target Values

Fre

qu

ency

Dat

a S

ourc

e/

Met

hod

olog

y

Res

pon

sib

ility

for

D

ata

Col

lect

ion

Com

men

ts

YR1 YR2 YR3 YR4

1(a). Number of direct project beneficiaries

Num

ber

0 199,601 220,000 260,000 325,000 371,000

Quarterly and annual project reports

Project MIS


1(b). of which female

% NA 50.1 50 50 50 50


Project MIS


2. Percentage of households with increased access to basic rural infrastructure

% 77 95.6

30% improvement on new IE baseline




3 times during project (baseline, midterm, final)

Randomized impact evaluation; ex post evaluation

Consulting firm (to be hired)

Change from original wording which stated: Change in access to improved quality of services, infrastructure and utilities. Definition of basic rural infrastructure will include water supply, roads, utilities,

27

health centers, schools, and irrigation.

3. Percentage of households who are satisfied with the quality of basic rural infrastructure

% 3.6 92.7








New. During the AF, this information will be collected by a consulting firm as part of the impact evaluation and not by the project team.

4. Changes in housing deficiencies: satisfaction with housing condition

% 33 96 75 75 75 75




This indicator has been modified. In the AF, only maintenance of housing will be carried out. The indicator will therefore measure the satisfaction with housing improvements and maintenance. Originally, the indicator read: Changes in housing deficiencies:

28

% decrease in households suffering from dampness; % increase in households with energy; efficient doors and windows; % increase in access to 24-hour water; % increase in access to 24-hour electricity

5. Improvement in the quality of IDP livelihoods

% 0 43

20% improvement in relation to the new baseline to be established as part of the impact evaluation

20% improvement from new IE baseline






New. Original PDO level indicator for livelihoods activities (% of targeted beneficiaries whose main source of household income is self-generated) will be tracked as an Intermediate Results indicator. Quality and sustainability of IDP

29

Note: IE = Impact Evaluation. 1. For new indicators introduced as part of the AF, the Progress to Date column is used to reflect the baseline value. 2. Target values should be entered for the years data will be available, not necessarily annually. Target values should normally be cumulative. If targets refer to annual values, please indicate this in the indicator name and in the ‘Comments’ column.

livelihoods will be measured through an index, including IDP increased incomes, assets, access to services.

Intermediate Results and Indicators

Inte

rmed

iate

R

esu

lts

Ind

icat

ors

Cor

e

Un

it o

f M

easu

re

Bas

elin

e O

rigi

nal

Pro

ject

S

tart

(20

11)

Pro

gres

s T

o D

ate

(201

5)

Target Values

Fre

qu

ency

Dat

a S

ourc

e/

Met

hod

olog

y

Res

pon

sib

ility

for

D

ata

Col

lect

ion

Comments YR1 YR2 YR3 YR4

Intermediate Result 1: Improved IDP living standards

1. Number of completed subprojects (disaggregated by type)

Number 0 196 270 340 410 490


Project MIS

SFDI

Type = water supply, electricity, irrigation, road, health centers, schools, and so on for Components A and B.

2. Number of people benefitting from access to improved

Number 0 129,512 170,000 230,000 270,000 313,000


Project MIS

SFDI

Changed wording. Original reads: Number of people provided access to services/utility/inf

30

infrastructure (disaggregated by type; also disaggregated by direct and indirect)

rastructure. Type = water supply, electricity, irrigation, road, health centers, schools, and so on.

3. Number of collective centers renovated by the project

Number 0 66 103 103 103 103


Project MIS

SFDI

Changed wording. Original reads: Number of collective centers having full-scale renovation

4(a). Grievances registered related to delivery of microproject benefits that are addressed (number)

Number 0 15 30 45 60 75


Project MIS

SFDI –

4(b). Grievances registered related to delivery of microprojects benefits that are actually addressed (%)

% 0 100 100 100 100 100


Project MIS

SFDI –

Intermediate Result 2: Improved IDP livelihoods 5. Increase in income of direct project

Percent

age 0 43 20 20 20 20

3 times during project (baseline,

Randomized impact evaluation


Change in wording from: ‘Amount of monthly

31

beneficiary households

midterm, final)

; ex post evaluation

household income’

6. Increase in income of direct project beneficiary households

Number 0 TBD TBD + 20% (in AZN)

TBD + 20% (in AZN)

TBD + 20% (in AZN)

TBD + 20% (in AZN)




New

7(a). Number of targeted beneficiaries who gain employment

Number 0

3,906 6,000 7,200 8,400 9,600




In the AF, tracking also self-employment. Will also track # of hours of employment.

7(b). Number of targeted beneficiaries who gain employment - female beneficiaries

Number TBD 2,661 3,000 3,600 4,200 5,400




New.

8. Increased value of assets owned by direct beneficiaries

Number TBD – TBD + 10%

TBD + 10%

TBD + 10%

TBD + 10%




Change in wording from: ‘Number and type of assets acquired by IDP as a result of the project’

9. Percentage increase in profit of microloan beneficiary businesses

Percent

age 0 – 20 20 20 20




New

This will be measured through an index including

32

IDP risk and dependency on state assistance, number of successive months in which beneficiaries’ income exceeds state assistance.

10. Number of active loan accounts – microfinance

Number 0 1,608 2,100 2,500 2,900 3,300


Project MIS

SFDI

10(a). Percentage of active loan amounts held by vulnerable IDPs

Percent

age 0 30 30 40 50 50


Project MIS

SFDI

New. Vulnerable IDPs will be defined as IDPs living in remote rural communities or those living under the poverty line.

10(b). Percentage of active loan amounts held by women

Percent

age 0 0 10 10 15 20


Project MIS

SFDI New

10(c). Percentage of project-supported institutions that are reporting on this indicator

Percent 0 0 100 100 100 100


Project MIS

SFDI –

33

Note: 1. Please indicate whether the indicator is a Core Sector Indicator (for additional guidance – please see http://coreindicators). 2. For new indicators introduced as part of the AF, the Progress to Date column is used to reflect the baseline value. 3. Target values should be entered for the years data will be available, not necessarily annually. Target values should normally be cumulative. If targets refer to annual values, please indicate this in the indicator name and in the ‘Comments’ column.

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