The World Bank Report No: ISR9881 Implementation Status & Results Kyrgyz Republic Reducing Technical Barriers for Entrepreneurship and Trade (P087811) Public Disclosure Copy Operation Name: Reducing Technical Barriers for Entrepreneurship and Trade Project Stage: Implementation Seq.No: 11 Status: ARCHIVED Archive Date: 31-Mar-2013 (P087811) Country: Kyrgyz Republic Approval FY: 2007 Product Line: IBRD/IDA Region: EUROPE AND CENTRAL ASIA Lending Instrument: Technical Assistance Loan Implementing Agency(ies): Key Dates Board Approval Date 13-Jul-2006 Original Closing Date 30-Apr-2011 Planned Mid Term Review Date 18-Dec-2009 Last Archived ISR Date 02-Jan-2013 Effectiveness Date 16-Jan-2007 Revised Closing Date 31-Mar-2013 Actual Mid Term Review Date 18-Dec-2009 Project Development Objectives Project Development Objective (from Project Appraisal Document) The overall project development objective is to streamline the compulsory standards requirements for business, develop systems to enhance product quality and safety, and increase enterprise competitiveness in pilot sectors. The key project outcomes will be a decrease in the cost of regulatory compliance for business and, in the longer term, an increase in the share of non-gold trade with WTO partners. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Technical Regulation 1.50 Metrology and Standards 2.20 Accreditation and Quality Enhancement 1.10 Project Management 0.20 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status Overview The RTBET Project made significant progress towards achieving its Development Objectives as illustrated by the accomplishments realized in the areas of technical regulation, metrology/testing and accreditation. A total of 34 Technical Regulations are now in force in various sectors ranging from food and agricultural products to construction and Page 1 of 10 The World Bank Report No: ISR9881 transportation services while the list of products subject to mandatory certification continues to be streamlined. State of the art reference laboratories acquired under the project are now allowing the Kyrgyz Center for Standards and Metrology to provide higher precision measurement and calibration services to various users from public providers (e.g., health services) to private sector companies (producers and manufacturers). The microbiology laboratory under the Ministry of Health is now able to provide testing services in a wide range of fields ranging from food to environment quality based on the radiology and physics equipment procured under the Project. The Kyrgyz Accreditation Center established under the Public Disclosure Copy Project has now entered the final stage of its graduation process to international recognition status by ILAC, which is expected to announce its final decision on full membership of the Kyrgyz Accreditation Center shortly. Notwithstanding the above mentioned progress in the development of the Kyrgyz Republic's quality infrastructure, the adoption of quality management systems by enterprises while increasing remains slow, due to a combination of factors ranging from competing investment priorities for companies that continue to face difficult economic conditions to the relatively low level of sophistication of local companies and buyers’ markets in which they operate. At Project closure, 12 companies in a wide range of sectors had acquired international certification of quality management systems (i.e. ISO) in sectors ranging from agribusiness and foodstuff to manufacturing (cement, bulbs) and services. Of these companies, only two benefited from the support of the pilot Matching Grant Facility set up under the project. As of en February, 2013 disbursement levels stood at 90.47% of Grant funds with a total value of USD 4,523,373 while an additional 4.75% is expected to be disbursed by project closure on March 31, 2013 under signed contracts currently under implementation. Locations No Location data has been entered Results Project Development Objective Indicators Public Disclosure Copy Page 2 of 10 The World Bank Report No: ISR9881 Indicator Name Core Unit of Measure Baseline Current End Target Public Disclosure Copy Public Disclosure Copy Page 3 of 10 The World Bank Report No: ISR9881 Public Disclosure Copy Public Disclosure Copy Page 4 of 10 The World Bank Report No: ISR9881 Public Disclosure Copy Public Disclosure Copy Page 5 of 10 The World Bank Report No: ISR9881 Decrease in cost of regulatory compliance Text Value CODB and BEEPS reports In addition to quantitative Decrease in the cost of highlighted high cost of improvements (i.e. regulatory compliance as regulatory compliance (with improvements in the Global reported by businesses and the 2005 BEEPS report Doing Business rankings - improvement of BEEPS and Public Disclosure Copy suggesting a significant which can be taken as a CODB ratings deterioration in thenumber proxy to measure the quality and length of inspections) of the overall business environment – from 90th position at project design to 70th position today; number of key Technical Regulations adopted in crucial sectors of the economy ranging from agribusiness to construction), a number of noteworthy qualitative improvements can also be highlighted. The introduction of Technical Regulations is for example at the root of a major regulatory reform -- the development of a Risk Based Inspection regime (RBI) -- that is currently being implemented in the country. Technical Regulations are indeed instrumental for the introduction of RBI as they allow categorizing products by Risk-Type. The IFC Investment Climate Advisory Services Project is likewise supporting the Ministry of Economy in its transition to RBI. According to MOE data, Public Disclosure Copy the introduction of RBI already led to a threefold decrease in the number of business inspections carried out in the first three quarters of 2012 in comparison with 2011 data for the same period (from 20,629 inspections in 2011 to 7,427 in 2012). Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments Page 6 of 10 The World Bank Report No: ISR9881 Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Technical Regulations developed and adopted Text Value No Technical Regulations 34 8 new Technical Regulations Public Disclosure Copy in key sectors of the economy Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments Reduction in number of products subject to Text Value 5500 Further gradual decrease in mandatory certification number of products subject to mandatory certification Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments The Government is currently considering a further reduction to 673 categories of goods pending approval of additional Technical Regulations. NISM as a whole certified for Quality Yes/No Value No Yes Yes Management System (QMS) Date 16-Jan-2007 20-Dec-2012 31-Mar-2013 Comments Increase in the percentage of national Text Value 38% 46% 46% documentary standards harmonized with Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 international standards Comments Increase in the number of measurement and Number Value 500.00 800.00 600.00 calibration services with lower level of Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 associated uncertainties. Comments The two state of the art labs in mass and temperature allowed CSM to meet its targets. Moreover, additional high-precision laboratories Public Disclosure Copy are currently being installed and the new labs will further increase CSM’s capacity to provide measurement and calibration services with lower level of associated uncertainties in a wider range of units. Page 7 of 10 The World Bank Report No: ISR9881 Accreditation body compliant with ISO/IEC Text Value Accreditation function carried Accreditation Center 17011 out by NISM under the old compliant with ISO/IEC 17011 Gostandard system opening the road for mutual recognition thereby allowing Public Disclosure Copy products and services tested once tobe accepted everywhere Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments ILAC final decision on KCA recognition is expected by end of March. Following the full audit carried out in September 2012, the KCAaddressed the gaps by providing detailed corrective measures in December 2012. The ILAC Audit Team requested a few integrations in January 2013 that the KCA submitted in February 2013. At least two testing laboratories accredited Number Value 0.00 0.00 2.00 according to international standards ISO/IEC Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 17025 Comments Delays in the procurement and installation of microbiology testing equipment prevented the full accreditation process. Equipment isfully installed and the laboratories will benefit from an international pre-audit that will produce a gap assessment and recommendations for Public Disclosure Copy international accreditation to be completed after project closing. At least 2 certifying bodies accredited Number Value 0.00 0.00 2.00 according to the relevant standard Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments Two certification bodies with approximate compliance have been identified. Nevertheless, the accreditation of two certification bodies will not be Page 8 of 10 The World Bank Report No: ISR9881 achieved by project closing due to timing issues and linkages with the accreditation process of the testing Public Disclosure Copy laboratories. Nevertheless, certification bodies will benefit from an international pre-audit that will produce a gap assessment and recommendations. Companies certified under ISO 9001, ISO Text Value 6 (baseline may have been 12 +10 additional ones 22000 and/or HACCP overestimated and will need to be re-confirmed) Date 16-Jan-2007 01-Mar-2013 31-Mar-2013 Comments (+6 from original baseline). The economic crisis continues to undermine the interest of companies in quality and ISO certification.However, at present, a number of companies in the KR sought and obtained international ISO accreditation: 12 companies representingvarious sectors (service, manufacturing, food processing) have an international ISO certificate. Of these, three are from the food sector; only two companies so far benefited from the Matching Grant Facility envisioned in the RTBET Project. Nevertheless, Public Disclosure Copy there is growing demand among local SMEs – especially in the agribusiness sector – to seek ISO22000 and HACCP certification due to pressures from destination markets such as Russia and Kazakhstan. Data on Financial Performance (as of 21-Feb-2013) Page 9 of 10 The World Bank Report No: ISR9881 Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P087811 IDA-H2470 Effective 13-Jul-2006 18-Oct-2006 16-Jan-2007 30-Apr-2011 31-Mar-2013 Public Disclosure Copy P087811 TF-90641 Closed 10-Mar-2008 10-Mar-2008 10-Mar-2008 30-Apr-2011 10-Mar-2012 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P087811 IDA-H2470 Effective USD 5.00 5.00 0.00 4.61 0.80 92.00 P087811 TF-90641 Closed USD 0.30 0.29 0.01 0.29 0.00 100.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation None Restructuring History Level two Approved on 30-Jul-2010, Level two Approved on 18-Apr-2011, Level two Approved on 17-Sep-2012 Related Projects There are no related projects. Page 10 of 10