The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) SME Competitiveness Project (P147705) EUROPE AND CENTRAL ASIA | Kazakhstan | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2015 | Seq No: 10 | ARCHIVED on 30-Dec-2019 | ISR39952 | Implementing Agencies: REPUBLIC OF KAZAKHSTAN, Ministry of National Economy, Ministry of National Economy Key Dates Key Project Dates Bank Approval Date: 02-Mar-2015 Effectiveness Date: 26-Feb-2016 Planned Mid Term Review Date: 12-Mar-2018 Actual Mid-Term Review Date: 14-May-2018 Original Closing Date: 30-Jun-2020 Revised Closing Date: 28-Feb-2021 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to enhance the competitiveness and capacity of targeted small and medium sized enterprises in Kazakhstan. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name 1. SME Capacity Building Program:(Cost $2.80 M) 2. SME Linkages in Competitive Sectors:(Cost $11.60 M) 3. Impact Evaluations & Monitoring:(Cost $2.20 M) 4. Project Management:(Cost $1.30 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Moderately Unsatisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Substantial Implementation Status and Key Decisions The disbursement is anticipated to increase by the end of 2019, with the release of all pending payments. As of December 2019, the disbursed amount is 24.3% (out of 18 million), with expected disbursement by end of 2019 to reach 35%. The Bank team met the new counterparts at the MNE and reconfirmed their commitment to the project and the components management. While the cluster activities have achieved their objectives, the rest of the activities supported by the project are yet to yield results. Focused efforts and coordination on behalf of all project stakeholders will be needed in the remaining time to make sure the project achieves its development objective. The most pressing issues which the team discussed and agreed with Ministry of National Economy (MNE) are: PIU staff retention: the Bank team expresses concern to the MNE about the PIU staff's turnover and the importance of staff retention by ensuring the budget resources and salary availability. 12/30/2019 Page 1 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) Contract management: for timely disbursement of the allocated budget and fulfillment of the contractual obligations, PIU would benefit from regular meetings with the MNE management. CY20 budget allocation: the MNE will request the Ministry of Finance (MoF) to allocate appropriate budget for the project in 2020, as currently there is a financing gap. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Substantial Substantial Substantial Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Substantial Substantial Institutional Capacity for Implementation and Sustainability Substantial Substantial Substantial Fiduciary Substantial High High Environment and Social Low Low Low Stakeholders Low Low Low Other -- Substantial -- Overall Substantial Substantial Substantial Results PDO Indicators by Objectives / Outcomes Number of SMEs who become accredited suppliers to large companies IN00784173 ►Number of SMEs who become accredited suppliers to large companies (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 100.00 Date 31-Dec-2014 31-May-2019 31-May-2019 28-Feb-2021 TO BE ACHIEVED BY NOVEMBER 2020. The activity is on track. The contract with the selected vendor, Euroconsultants, was signed on July 12, 2019 for USD 7 mln. The vendor has already assessed over 200 Comments: SMEs (out of 270 SMEs that applied to participate in the program). The vendor has already started preparing action plans for 100 SMEs to help them obtain accreditations in the period between April and November 2020. Due to heterogeneity of SMEs, the accreditations are expected to take place in 3 stages, 12/30/2019 Page 2 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) with some SMEs obtaining accreditation within 2 months, the others obtaining accreditation in 4 and 6 months). Number of Cluster Competitiveness Action Plans for which implementation has begun IN00784171 ►Number of Cluster Competitiveness Action Plans for which implementation has begun (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 6.00 6.00 6.00 Date 31-Dec-2014 31-May-2019 31-May-2019 28-Feb-2021 This indicator was increased from 4 clusters to 6 during the project restructuring. The indicator was achieved in 2018 with the launch of clusters' development plans implementation. The government agency Comments: in charge of clusters (the Kazakhstan Center for Exports and Investment) is continuing their implementation, as planned. Percentage of participating SMEs reporting improved management and business practices IN00784172 ►Percentage of participating SMEs reporting improved management and business practices (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 53.00 75.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 This indicator is measured through annual surveys carried out among SMEs benefitting from Subcomponent 1.2 (improved quality of state-funded business development services), Subcomponent 2.1 (SMEs that become suppliers to large enterprises), Subcomponent 2.2 (development of territorial clusters), Subcomponent 2.3 (factoring assessment). Upon completion of the cluster development activities (Subcomponent 2.2) in August 2019, 166 SMEs Comments: (members of 6 clusters - main beneficiaries of the activity) were surveyed on improvements in management and business practices and 53% of these firms reported improved management or business practices. This represents partial fulfillment of the PDO indicator#2. The indicator will be fully measured in December 2020, through the survey of the Supplier Development Program beneficiary SMEs. Intermediate Results Indicators by Components 1. SME Capacity Building Program IN00784174 ►Number of local SME Advisors trained to undertake SME capacity building based on an established competency framework (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 150.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 12/30/2019 Page 3 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) The indicator tracks the progress achieved in implementation of training services for business consultants. Contract for this activity is not signed, pending MNE signature, thus indicator is delayed. It is expected Comments: that if the Consulting Company (Emerging 360) will commence the training of business consultants in January 2020, it will complete the process by July 2020. IN00784177 Percent of Women Advisors trained (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 30.00 IN00784178 ►Percent of training participants who found the training offered as effective and useful to them (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 99.00 99.00 66.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 The indicator outperformed the 66% target for CY 2019. In all, 97 representatives of state agencies took part in training on best practices in cluster development and Monitoring&Evaluation of SME support projects. More than 99% of training participants found the training sessions as effective and useful. The Comments: indicator will be measured again once training events for advisors and SMEs are completed under components 1 and 2. IN00784181 ►Number of candidatees to master trainers, assessors, instructional designers developed and trained in global best practice (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 40.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 The indicator tracks the progress achieved in implementation of training services for business consultants. Comments: Contract for this activity is not signed, pending MNE signature, thus indicator is delayed. 2. SME Linkages in Competitive Sectors IN00784175 ►Number of SMEs who are in the process of becoming "accredited suppliers" to large companies (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 200.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 The activity is on the way, as planned. The contract with the selected vendor, Euroconsultants, was Comments: signed on July 12, 2019. IN00784179 ►Number of Cluster Competitiveness Action Plans that have been developed (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 6.00 6.00 6.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 12/30/2019 Page 4 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) This indicator was increased from 4 clusters to 6 during the project restructuring. The indicator was achieved in 2018 with the launch of clusters' development plans implementation. The government agency Comments: in charge of clusters (the Kazakhstan Center for Exports and Investment) is continuing their implementation, as planned. IN00784182 ►Strategic assessment for supply chain financing program has been completed, including recommendations on design, partners, structure, location, and regulatory requirements. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Strategic assessment completed with clear Assessment with and actionable Activity is new and no The consultant is recommendations on recommendations on Value prior experience is selected and the contract all aspects of the the next steps for available in the country signing is in progress terms of refence development of supply completed chain financing in the country and factoring program installed. Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 This indicator measures progress on subcomponent 2.3. The indicator is on track. The implementing agency signed a contract with Capital Tools Solutions Company in March 2019. The consultant is Comments: currently consulting SMEs, National Bank, commercial banks, payment and clearance operator and other stakeholders about possible factoring platform solutions. The activity will be completed by March 2020. IN00784184 ►Value of increased sales of SMEs facilitated through participation in the project (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 25,000,000.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 This indicator pertains to the supplier development activities and the value of increased sales of SMEs to Comments: large companies. It remains unchanged and is expected to be met by 2020.ON TRACK. IN00784185 ►Direct project beneficiaries (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 230.00 848.00 3,500.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 In addition to the 230 beneficiaries accounted in the years 2016-2018 as part of the cluster development activities, 618 SME managers and employees of government and related institutions (296 of them are women or 47.9%) became direct beneficiaries in the first half of 2019, :  As part of the activities to develop a feasibility study of a factoring platform in Kazakhstan and to improve the competence of stakeholders, Consultant conducted more than 60 seminars for SMEs on factoring, which were attended by representatives of 566 SMEs, including 272 women.  As part of the cluster development initiative's capacity building program in 2019, 52 employees Comments: of government and related institutions, participated in trainings, seminars, and study tours, including 24 women.  Thus, the percentage of female beneficiaries for the 1st half of 2019 was (24+272)/(52+566)*100% = 47,9%.  In cumulative total from 2016 through the 1st half of 2019, the Indicator "Direct Beneficiaries of the Project" was: 230+618=848. IN00784186 12/30/2019 Page 5 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) Female beneficiaries (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 43.50 47.90 30.00 3. Impact Evaluations & Monitoring IN00784176 ►Number of impact evaluations of SME interventions conducted or underway (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 1.00 3.00 3.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 The consulting company Lattanzio already completed the evaluation of the Business Roadmap-2020 and Enbek state program in September 2019 and will complete the assessment of the SME competitiveness Comments: project at the end of December 2019. IN00784180 ►Number of government and associated professionals/staff receiving capacity building through trainings, workshops, study visits, etc. (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 67.00 168.00 125.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Feb-2021 This indicator has outperformed and includes staff of the Ministry of National Economy, National Chamber of Entrepreneurs, Ministry of Investment and Development, Supplier Development Office, Kazakhstan Comments: Center for Industry and Export and other relevant public entities in charge of formulation and implementation of programs to SMEs trained by the Project. IN00784183 ►Beneficiaries reporting that working group decisions represented their views (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 91.00 75.00 Date 31-Dec-2014 31-May-2019 30-Dec-2019 28-Jan-2021 This indicator was introduced during the Project Restructuring in December 2018 to measure the level of citizen engagement in Project activities. It tracks the proportion of beneficiaries reporting that the approaches discussed in the course of the Project discussions reflect their views. In the first half of 2019, as part of the activity to develop a feasibility study of a factoring platform in Kazakhstan and to improve Comments: the competence of stakeholders, the Consultant conducted more than 60 seminars for SMEs on factoring, which were attended by representatives of 566 SMEs. During the seminars, representatives of 91% of SMEs reported that the approaches discussed during the seminars reflected their views. The indicator will be measured again. Data on Financial Performance Disbursements (by loan) 12/30/2019 Page 6 of 7 The World Bank Implementation Status & Results Report SME Competitiveness Project (P147705) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P147705 IBRD-84770 Effective USD 40.00 18.00 22.00 5.86 12.14 33% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P147705 IBRD-84770 Effective 02-Mar-2015 20-Jul-2015 26-Feb-2016 30-Jun-2020 28-Feb-2021 Cumulative Disbursements Restructuring History Level 2 Approved on 28-Dec-2018 Related Project(s) There are no related projects. 12/30/2019 Page 7 of 7