The World Bank Emergency Operation for Development (P155732) REPORT NO.: RES41602 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF EMERGENCY OPERATION FOR DEVELOPMENT APPROVED ON JULY 7, 2015 TO MINISTRY OF FINANCE URBAN, RESILIENCE AND LAND MIDDLE EAST AND NORTH AFRICA Regional Vice President: Ferid Belhaj Country Director: Saroj Kumar Jha Regional Director: Ayat Soliman Practice Manager/Manager: Jaafar Sadok Friaa Task Team Leader(s): Ibrahim Khalil Zaki Dajani, Nadwa Rafeh, Nafie Mohammed Mofid The World Bank Emergency Operation for Development (P155732) I. BASIC DATA Product Information Project ID Financing Instrument P155732 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 07-Jul-2015 31-Dec-2022 Organizations Borrower Responsible Agency Ministry of Health,Ministry of Electricity,Ministry of Construction, Housing, Municipalities and Public Works,Reconstruction Fund for Areas Affected by Terroristic Operations, C/O Dr. Mustafa Hiti,Ministry of Agriculture - C/O Dr. Hamid Ali Hadwan, Director General of Plant Protection Department,Ministry of Education, C/O Mr. Sabah Khalaf Jebur, Director General,Ministry of Ministry of Finance Water Resources,Anbar Governorate,Diyala Governorate, C/O Muthanna Ali Mahdi al-Tamimi, Governor,Nineveh Governorate, C/O Ameen Ibrahim Fanash, Deputy Governor for Planning,Salah Ad-Din Governorate,Roads and Bridges Directorate @ Ministry of Construction, Housing, Municipalities and Public Works,Ministry of Transport Project Development Objective (PDO) Original PDO The Project is to support the Republic of Iraq in the reconstruction of damaged infrastructure and the restoration of public services delivery in Targeted Municipal Areas. Summary Status of Financing Ln/Cr/Tf Approval Signing Effectiveness Closing Net Disbursed Undisbursed The World Bank Emergency Operation for Development (P155732) Commitment IBRD-87930 31-Oct-2017 05-Jul-2018 21-Aug-2018 31-Dec-2022 400.00 22.14 377.86 IBRD-85200 07-Jul-2015 12-Jul-2015 18-Sep-2015 30-Jun-2021 350.00 261.90 88.10 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES PROJECT STATUS: The project continues to progress towards achieving its objectives, i.e. "to support the Republic of Iraq in the reconstruction of damaged infrastructure and the restoration of public services delivery in Targeted Municipal Areas." The performance of the project is currently rated Moderately Satisfactory. Many of the services are being restored with benefits reaching over 3 million people in the areas in five governorates liberated from ISIS. Commitments have reached US$ 290 million (or 83% of loan proceeds) while disbursements reached US$ 262 million (or 74.8% of the loan proceeds). The project is already contributing to (a) restoring electricity connectivity with an average of 35% increase in the hourly electricity supply in 27 targeted cities and towns in four governorates (Anbar, Diyala, Ninawa and Salah ad-Din) with a total beneficiary of 1 million people; (b) restoring essential municipal services including regular municipal waste collection, functioning water purification compacts to about 1.7 million people in 30 towns and villages in three governorates (Anbar, Diyala and Salah ad-Din); (c) restoring access through the repair and reconstruction of roads and bridges with 25 essential and strategically located bridges have been reconstructed and 400 kilometers of essential road corridors have been rehabilitated serving about 3 million people in 30 cities and towns in four governorates of (Anbar, Diyala, Ninawa and Salah ad-Din); (d) restoring health services through the supplied 82 ambulances with communication equipment, and 14 mobile clinics, serving 1 million people in 20 cities and towns in two governorates (Diyala and Salah ad-Din). In addition, based on the Government of Iraq’s (GOI) request, the project and through the uncommitted funds under loan Category 4b(ii) is suppling essential medical equipment and supplies for COVID-19 preparedness and response. The support specifically aims to strengthen intensive care unit (ICU) capacity at public hospitals for improved COVID-19 case management. The supply is being achieved through an agreement between the Ministry of Health (MOH) and United Nations Office for Project Services (UNOPS) signed on April 30, 2020 in the amount of US$ 7.8 million. Equipment and supplies will be delivered to designated sites in four to eight weeks; and (e) the emergency repair of water control, infrastructure and irrigation schemes activities have been substantially delayed as the counterpart was focus on activities being financed under the EODP Additional Financing as well as the delays in approving the national 2020 budget which hindered the registration of any new activities to be financed under EODP including that under this category. The project is also achieving good progress in implementing state/citizen trust-building and reconciliation promotion initiatives. Led by the communication expert at the Reconstruction Fund - Project Coordination Unit (PCU), 31 trust- building and reconciliation workshops and training sessions have been carried out in five governorates liberated from The World Bank Emergency Operation for Development (P155732) ISIS. 79 NGOs and just over 1,000 individual participants of which 40% are women participated in train-the-trainer workshops to promote community internal dialogue and reconciliation and to rebuild trust between the societies and the government. Furthermore, five WhatsApp groups have been established to communicate with the RF communication expert and World Bank TTL about the progress in implementing the EODP activities and other areas of priorities. A previously announced one hour connections are being held on weekly basis bringing about 88 men and women (youth leaders) to this exchange platform. Disbursement has been improved as a result of close monitoring of payments to contractors and suppliers. The Third- Party Monitoring Agency (TPMA) who has been retained by the Bank continues to provide the needed support to verify contractual compliance with technical, fiduciary, and safeguards aspects of the project. In addition, technical and financial audits are being performed by independent consultants whose services are procured by the Reconstruction Fund and in accordance to Terms of Reference (TORs) cleared by the Bank's task team and based on Bank's procurement guidelines. The audits aim to provide another layer of verification of implementation of the activities being financed by EODP and their compliance with the various requirements. The compliance with the safeguards policies requires greater attention. While there is a general compliance with construction site management, attention needs to focus on workers safety to ensure full compliance with the Occupational Health and Safety measures identified under the Environmental and Social Management Plans. Similarly, there is a general compliance with social safeguards with an exception of one case of temporary land a cquisition that is currently in the final stages of documentation. COVID-19 in Iraq. The first COVID-19 case was reported in Iraq on February 24, 2020. As of May 5, 2020, Iraq has reported 2,431 confirmed cases and 102 reported deaths. COVID-19 has now spread to all governorates in Iraq, while majority of the cases are in Baghdad and Basra. The MOH has expanded in-country diagnostic capacity with around 3,000 tests per day at the central health laboratory in Baghdad (Medial City), Erbil (Kurdistan region), Najaf and Basra. Despite MOH’s efforts, and funding through external grants and in-kind support (personal protective equipment, testing kits, basic hygiene items etc.) from China, France, Kuwait, Netherlands, UNHCR, and USAID, Iraq still faces a threat posed by COVID-19 outbreak and has limited health system capacity to address increase demand due to rising COVID-19 cases. PROPOSED CHANGES The proposed restructuring aims to reallocate US$ 25.825 million to Category 4b(ii) to support the MOH to respond to the COVID-19 pandemic. These funds will be reallocated from Categories: (i) 4b(i) provision of repair to the damaged health services (US$ 5 million); (ii) 6 (Unallocated) (US$ 0.825 million); and (iii) 7 (Emergency Repair of Water Control, Infrastructure and Irrigation Schemes) (US$ 20 million) as presented in the “Reallocation between Disbursement Categories” table below. Rationale for restructuring. The proposed restructuring will support the government prevent, detect and respond to the COVID-19 pandemic in Iraq. The restructuring responds to a request from the GOI dated May 4, 2020 to reallocate funds towards COVID-19 preparedness and response that will allow for immediate support to finance the procurement of medical equipment and consumables and supporting training of health workers and front-line responders. In particular, the restructuring aims to provide financial support to the MOH to: (a) procure beds, furniture, ventilators, CT machines, PCR machines, testing kits, equipment for intensive care units, and other equipment and supplies for COVID-19 case management; and (b) train medical staff on the use of these equipment. The World Bank Emergency Operation for Development (P155732) Procurement Arrangements. Procurement for the project continues to be carried out in accordance with the World Bank’s Procurement Regulations for IPF Borrowers for Goods, Works, Non-Consulting and Consulting Services, dated July 1, 2016 (revised in November 2017 and August 2018), and the World Bank’s Anticorruption Guidelines, dated October 15, 2006, revised in January 2011, and as of July 1, 2016. There are no changes to risk assessment and mitigation measures. The procurement approach continues to prioritize fast track emergency procurement for the emergency procurement of required goods, works and services. Procurement of medical equipment will build on the successful experience with UNOPS (who are already procuring similar medical equipment under the project) to procure the additional needs. UNOPS will use its emergency "fast track" procurement procedures for expedited supply of emergency equipment. The procurement transactions will continue to use the Systematic Tracking of Exchanges in Procurement (STEP) to plan, record and track procurement transactions. Financial Management. The new allocated amount of category 4(b)(ii) is US$ 25.825 million. The Project Management Team (PMT) of Category 4(a) is responsible for implementing this new category of 4(b)(ii) and for submitting the interim un-audited financial statements on quarterly basis. This restructuring is occurring in IBRD85200 (Parent EODP) thus, the Borrower will have audited financial statements based on the current signed contract with Ernst and Young. It is possible to submit the audited financial statements, auditor report and management letter along with the package of 4a category, because it is implemented by the same Implementing Agency (IA) and PMT. Safeguards. The EA Category of the Project is “B”. A Bank-cleared and disclosed Environmental and Social Management Framework (ESMF) and Resettlement Policy Framework (RPF) are in place for both EODP and EODP-AF. For the activities under the Health Component (4), Bank-cleared site-specific ESMPs and Medical Waste Management Plans (MWMPs) are in place for all the health centers and mobile clinics. The scope of the instruments under Component 4 already covers the scope of purchasing medical equipment which is the exact scope to be financed under this restructuring. No additional impacts from this restructuring are expected to require updating the ESMF. No change in the Project EA Category will take place and no land acquisition is anticipated as a result of the restructuring. No new safeguards policies will be triggered by this restructuring. II. DETAILED CHANGES REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Current Current Actuals + Proposed Disbursement % Ln/Cr/TF Expenditure Allocation Committed Allocation (Type Total) Category Current Proposed IBRD- CW G 85200-001 NCS;CS;IOC 70,000,000.00 67,242,178.55 70,000,000.00 100.00 100.00 Currency: Parts1&6a USD Project The World Bank Emergency Operation for Development (P155732) GD;NCS;CS;IOC Parts2;5a,d&6b 62,000,000.00 50,587,509.58 62,000,000.00 100.00 100.00 Projct GD;NCS;CS;IOC Parts3;5b,c&6c 137,000,000.00 108,685,262.40 137,000,000.00 100.00 100.00 Projct GD;NCS;CS;IOC; 18,000,000.00 14,952,698.40 18,000,000.00 100.00 100.00 P4a, 5e, 6d GD;W, NCS;CS;IOC; 12,100,000.00 0.00 7,100,000.00 100.00 100.00 P4bi GD;W, NCS;CS;IOC; 10,000,000.00 500,000.00 35,825,000.00 100.00 100.00 P4bii GD;NCS;CS;IOC; TRG;WSH 5d,i& 9,200,000.00 4,720,571.70 9,200,000.00 6e Pjct UNALLOCATED 825,000.00 0.00 0.00 G W NCS CS IOC 30,000,000.00 0.00 10,000,000.00 100.00 100.00 P7 Total 349,125,000.00 246,688,220.63 349,125,000.00