The World Bank Report No: ISR12238 Implementation Status & Results Burkina Faso BF-Competitiveness & Enterprise Development Project (P071443) Public Disclosure Copy Operation Name: BF-Competitiveness & Enterprise Development Project Project Stage: Implementation Seq.No: 22 Status: ARCHIVED Archive Date: 26-Dec-2013 (P071443) Country: Burkina Faso Approval FY: 2003 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Technical Assistance Loan Implementing Agency(ies): Key Dates Board Approval Date 04-Mar-2003 Original Closing Date 30-Jun-2008 Planned Mid Term Review Date 30-Jun-2012 Last Archived ISR Date 26-Jun-2013 Effectiveness Date 08-Dec-2003 Revised Closing Date 31-Dec-2013 Actual Mid Term Review Date 11-Jun-2012 Project Development Objectives Project Development Objective (from Project Appraisal Document) To contribute to private sector development in Burkina Faso by creating conditions for improved competitiveness, enterprise development, and investment promotion. Has the Project Development Objective been changed since Board Approval of the Project? ● Yes No Component(s) Component Name Component Cost ORIGINAL PROJECT ACTIVITIES (RESTRUCTURED) 8.50 ENTERPRISE DEVELOPMENT, INVESTMENT PROMOTION AND INVESTMENT CLIMATE 12.35 ACTIVITIES PROJECT MANAGEMENT/COORDINATION 1.50 CONTINGENCIES 0.00 ACCESS TO FINANCIAL SERVICES 6.02 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Low Low Implementation Status Overview This is the last ISR being filed for the Project before it closes on December 31, 2013. The original project was approved by the Board on March 4, 2003 (Credit 37330) for SDR 18.7 Page 1 of 6 The World Bank Report No: ISR12238 million (USD 30 million equivalents) and a Grant (IDA H0220) for SDR 4.10 million. The original closing date was on June 30, 2008. The project had two restructurings. The first restructuring (Level II) done in 2008 extended the closing date to December 31, 2010. The Second restructuring (Level I) made available an additional financing (Grant H6370) of USD 20 million and extended the project closing date to December 31, 2013. This additional financing became effective on June 17, 2011. Public Disclosure Copy RELEVANCE: The Competitiveness and Enterprise Development Project (CEDP) was approved on March 03, 2003, with the objective of assisting Burkina Faso to improve the competitiveness of its economy through privatization and utility reform, investment climate improvement and private sector institutional development, and mitigation of constraints to small and medium enterprise development. The objectives remained highly relevant throughout the original project implementation , and the project has at some point been able to adapt to the demands of the economy, especially regarding the privatization and utility reform agenda. In May 2008, at the request of the Government, the Project was restructured (level two) and project closing date extended by a year from June 30, 2008 to December 31, 2010. The project restructuring enabled the scaling up of the enterprise development component after having demonstrated success in the one stop shop for business creation , the investment climate reforms and the provision of effective business development services (BDS), and of microfinance services to micro, small and medium enterprises (SMEs). Further, it enabled the government to attract a strategic international private operator for the public telecommunication entity. There were new activities that were introduced to improve the capacity of the Ministry of Mining to deal with the mining firms in terms of regulations, implementation of the mining code, compliance with the Extractive Industries Initiative as well as build capacity within the Ministry. The project was rated satisfactory for its overall implementation and development objective, satisfactory for the Public Enterprise Component and highly satisfactory for its Enterprise Development Component. In March, 2010, the Government requested another extension for additional financing and a restructuring of the project. The Second restructuring (Level one) made available an additional financing (Grant H6370) of USD 20 million and extended the project closing date to December 31, 2013. The project development objective was adjusted to keep its relevance with the changing country context and new sector policies as well as institutional and capacity issues. The objective became “to contribute to private sector development in Burkina Faso by creating conditions for improved competitiveness, enterprise development and investment promotion.” This additional financing allowed the authorities to scale up enterprises development activities supported by the original project, support investment and export promotion and strengthen investment climate activities. It also helped the Government to start the implementation of the newly approved financial sector strategy developed by the Government with an access to financial services component. The restructuring of Part 1 of the original Project allowed to reflect a change of Government policy on privatization, especially regarding the energy sector institutional reform by supporting the Government to develop a capacity building program for Société Nationale d’Electricité du Burkina (SONABEL) to improve its management and service delivery (after reformulation of this activity). Competitiveness and Enterprise Development continue to be of pivotal importance as expressed in the Government's Strategy for Faster Growth and Sustainable Development for 2011-2015, known as SCADD. The relevance of the project is further demonstrated by the Government's request for further assistance with the aim of building on the reforms initiated in the financial sector under this operation and the shifting of remaining funds to another operation in support of the private sector. EFFICACY: Although the ICR will provide a full evaluation of the project, available evidence indicate that the project progress towards achieving the Project Development Objectives (PDO) remained moderately satisfactory as measured by (i) the number of jobs created by enterprises supported by the project from 2296 at AF inception to 16438 at present (target exceeded) and number of enterprises registered with assistance from the project in the one stop shop from 15 000 to 28 516 (target exceeded); (ii) the credit to private sector as a Public Disclosure Copy percentage of GDP from 16% to 22% target exceeded) in component 2).The PDO level indicator that did not fare well is the one related to number of international firms attracted by the Investment Promotion Agency (IPA) which may not be achieved due to delays in creating and formalizing the agency. However, the project contributed to establishing the agency with technical assistance for the institution's statutes and institutional arrangements as well as capacity building for key staff recruited. The project also supported four annual sessions for CPI (CPI members include 10 local investors, 10 international resident investors and 10 international non resident investors). The last session was held November 7-8,2013. An Investment law was drafted by CPI with support from the project and approved in May 2013. An Investment tracking system was created by CPI with the statistic institute and support from the project . The indicators that were not achieved are those related to decrease in total tax (all taxes paid by an enterprise as % of the profit) and those related to investment code revamping. However studies underway will provide action plans and a roadmap to implement and achieve the overall objective of improving the business environment after the project closed. FIDUCIARY MANAGEMENT: Page 2 of 6 The World Bank Report No: ISR12238 With regard to the Financial Management, the FM rating has been maintained at moderately Satisfactory (MS), The FM risk rating remains the same as Low (L). EFFICIENCY: Although sufficient data is not available at this point, available evidence indicate that the amount of resources allocated to the components was efficient. In the enterprise development component, there has been a reduction in time and cost to create an enterprise not only in the capital city but also the reduction in costs of transportation due Public Disclosure Copy to the one stop shop presence in 8 regional offices. The centralization of the regional registries of commerce through the centralized computerized system (the national RCCM) involved a reduction in costs to archiving and gains in lost licenses reproduction. Sustainability: After project closing , the “Maison de l’Entreprise” will continue to provide business development services and counseling as well as maintain the one stop shops as 85% of it its operating costs are currently covered by its fees activities and its members ‘contribution. Activities undertaken for investment promotion will continue through budgetary resources and capacity building activities for the energy company will be implemented through the company’s own resources due to an increased accounts receivables recovery rate (98.5%). DISBURSEMENT: Overall the project was characterized with slow disbursement. the overall disbursement rate (for both the original project and additional financing) is about 80%. Disbursement improved after the restructuring. PROCUREMENT MANAGEMENT: The project implementation unit (PIU, -- MEBF, Maison de l’Entreprise du Burkina --) has been exerting all the efforts for the successful implementation of the planned procurement activities. The PIU has intensified monitoring of implementation progress of all agreed priority actions and will continue monitoring the finalization and completion of all activities. The Findings of the last Post Procurement Review (PPR) report shows that there were no procedural gaps associated with procurement and the remedial actions of the findings of the former PPR were adequately implemented. The rating of procurement performance was however rated as Moderately Satisfactory (MS) due to delays in procuring contracts in the past and the number of contracts under implementation. Locations Country First Administrative Division Location Planned Actual Burkina-Faso Not Entered Ouagadougou Airport Burkina-Faso Not Entered Bobo Dioulasso Airport Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Number of jobs created by enterprises Number Value 2292.00 14994.00 15792.00 Public Disclosure Copy supported by the project per year. Date 05-Dec-2013 31-Dec-2013 Comments june 2010 number increased from 14994 target reached value for each period to 16438 registered Number of enterprises created with assistance Number Value 15000.00 28516.00 27000.00 from the project Date 30-Sep-2013 31-Dec-2013 Comments june 2010 target reached target reached Page 3 of 6 The World Bank Report No: ISR12238 Number of international firms attracted by the Number Value 0.00 0.00 3.00 CPI and API Date 31-Dec-2013 Comments june 2010 API Created ,functional and API Created ,functional and Public Disclosure Copy operational.Director recruited operational.Director recruited and receiving support from and receiving support from project.For CPI,four annual project.For CPI,four annual sessions were organized with sessions were organized with project support (CPI project support (CPI members include 10 local members include 10 local investors, 10 international investors, 10 international resident investors and 10 resident investors and 10 foreign non resident foreign non resident investors). Last session held investors). Last session held in November 7-8,2013. in November 7-8,2013. Investment law drafted by CPI Investment law drafted by CPI with support from the project with support from the project and approved in May 2013. and approved in May 2013. An Investments tracking An Investments tracking system was created by CPI system was created by CPI with the statistic institute and with the statistic institute and support from the project. support from the project Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Increase in the number of clients and loan Text Value DROPPED portfolio outstanding by registered microfinance Date institions not more than 15% of non-performing Comments INDICATOR DROPPED loans. FROM THE Additional financing and the restructuring Percentage of MEBF operating cost covered by Percentage Value 70.00 85.00 95.00 its fee activities and member contribution Date 30-Sep-2013 Public Disclosure Copy Comments JUNE 2010 end of year percentage will be DEC 2013 know in early 2014 and will feed ICR. Number of additional enterprises receiving Number Value 569.00 1383.00 780.00 support from MEBF Date 30-Sep-2013 Comments ADDITIONAL NUMBER additional number for Target reached. FROM YEAR TO YEAR 2012=1294, number for Q1- Q3 2013=89. Target reached, matching grants fully committed. Page 4 of 6 The World Bank Report No: ISR12238 Increase in the number of enterprises that are Number Value 0.00 83.00 15.00 computerized in the RCCM Date 30-Sep-2013 Comments no RCCM centralized system- 56 582 RCCM data collected End target reached. target is Public Disclosure Copy RCCM transfer decree to in 22 jurisdictions - a 15% increase in the number MEBF signed by Ministry of computerization in the of register of commerce that Justice- Office space national RCCM started and are in the centralized allocated and personel reached 83% of data computerized system (in the seconded collected. nationalRCCM Improvement in SONABEL management ratios Percentage Value 91.16 98.75 98.00 Date 30-Sep-2013 Comments target reached Target reached. Investment promotion agency annual business Text Value Feasibility study and business business plan started to be Business plan implemented plans implemented plan completed implemented, Date 30-Sep-2013 Comments JUNE 2010 API Created , creation act DEC 2013 adopted , Director on board and receiving support from project (capacity building and equipment) Number of mobile banking accounts opened Number Value 0.00 51200.00 50000.00 Date 30-Sep-2013 Comments JUNE 2010 data from telecoms operators Target reached. in burkina. Decrease in MFI non performing loan rate. Percentage Value 4.60 5.22 4.00 Date 30-Sep-2013 Comments JUNE 2010 slight increase in MFIs non performing loans from 4.09% in 2012 to 5.22%. Public Disclosure Copy Data on Financial Performance (as of 09-Dec-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P071443 IDA-37330 Effective 04-Mar-2003 19-Mar-2003 08-Dec-2003 30-Jun-2008 31-Dec-2013 P071443 IDA-H0220 Effective 04-Mar-2003 19-Mar-2003 08-Dec-2003 30-Jun-2008 31-Dec-2013 P071443 IDA-H6370 Effective 20-Dec-2010 21-Feb-2011 17-Jun-2011 31-Dec-2013 31-Dec-2013 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed Page 5 of 6 The World Bank Report No: ISR12238 P071443 IDA-37330 Effective XDR 18.70 18.70 0.00 16.52 2.18 88.00 P071443 IDA-H0220 Effective XDR 4.10 4.10 0.00 4.10 0.00 100.00 P071443 IDA-H6370 Effective XDR 12.80 12.80 0.00 8.68 4.12 68.00 Public Disclosure Copy Disbursement Graph Key Decisions Regarding Implementation The Bank's Implementation Completion Report (ICR) for the project will be prepared, finalized and disclosed following its completion by June 30, 2014. Restructuring History CD Decision on 12-Jun-2008 Public Disclosure Copy Related Projects P123310-BF-Competitiveness & Ent Dev Add Financing Page 6 of 6