Project Management of World Bank Projects

Nov 30, 2009

CONTENTS

The Banks Overview The Project Cycle The Challenges

World Banks Overview

The World Bank Group, among the worlds largest development institutions, is a major source of financial and technical assistance to developing countries around the world. Finances international projects on trade, finance, health, poverty, education, infrastructure, governance, climate change etc In fiscal 2009, the World Bank Group sponsored 767 projects with a total commitment of $58.8 billion, distributed in financial assistance.

The Banks Objectives

Reduce poverty, and Stimulate economic growth Provide Capital and Knowledge Services Manage resources (trust funds) Invest in people Build client capacity Promote economic reform Stimulate private sector growth Protect the environment Fight corruption

Lending by Sector
FY70 and FY09

FY70
Infrastructure 58% Human Development 4%

FY09

Finance/PSD 15% Multisector 3% Agriculture 20%

Todays Lending Context

IMF Financial instruments Loans Guarantees Bank Knowledge instruments Analytic/ESW Advisory/TA

International capital markets

Domestic private sector & capital markets

Country
Civil Society Organizations Bilateral s

Multilaterals

The Banks Current Business Approach

Client in drivers seat Partnerships Comprehensive diagnosis, strategic selectivity Concentration on poverty

Accountability and focus on outcomes/results

The Banks Business Products

Lending Products Manage financial resources (trust funds) and provide grants Donor Coordination

Knowledge Products & Services

Research products Technical assistance

Functions of Knowledge Services

Analytical/strategic basis for Bank/country dialogue & lending Technical advice Knowledge dissemination Lending Project preparation Country capacity building

Banks projects follow a predefined life cycle

CONCEPTUAL

CAS

Identification and Preparation

Appraisal and Negotiation

Supervision

Evaluation

Board

The Country Assistance Strategy spans a period of 3 4 years with defined goals and means
REAL EXAMPLE

Starts from a country-owned development vision and strategy

Includes a diagnosis of the countrys development situation, carried out in consultation with the Government and other partners, and drawing on their work Sets out a selective Bank Group program, reflecting the role that the Government requests the Bank to take with respect to its other partners
Provides a monitoring and evaluation framework to assess results

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Functions of the CAS

A business plan
REAL EXAMPLE

A summary assessment and diagnostic of the country

A precise internal covenant to manage creditworthiness and exposure A memorandum of understanding on the Banks work between the Bank and the government

An accountability tool to measure whether results have been achieved

An instrument for disseminating and advertising the Banks role

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During the Identification and Preparation phase, CAS goals are translated into a Project Concept Note

CAS

Identification and Preparation

Appraisal and Negotiation

Implementation and Supervision

Evaluation

Board

Translation of the Country Assistance Strategy into

actionable projects

Intensive discussions with the Countrys Government

officials to define projects scope, length, and specific components

Initial preparation of a Project Concept Note (PCN),

Concept-stage PID with the participation of internal peer reviewers (3 to 5 per project) and circulated within the Bank
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The Appraisal and Negotiation phase further details the project in order to go to the Board

CAS

Identification and Preparation

Appraisal and Negotiation

Implementation and Supervision

Evaluation

Board

Components of the PCN are further decomposed into activities,

each activity is scheduled for its length and its cost appraised

The project is evaluated by the Quality Assurance Team, and

environmental, social protection and indigenous people safeguards are applied

The overall project is detailed in a Project Appraisal Document

(PAD) of 100+ pages, the base of the project from now on

The Loan Agreement is negotiated with the Countrys

Government
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In the Bank, the Board is the key decision instance

CAS

Identification and Preparation

Appraisal and Negotiation

Implementation and Supervision

Evaluation

Board

The Board represents the Governments of the countries

that are members of the Bank (~150) through the different Chairs

All projects go through the Board, some on fast-track and

some require intensive discussion

A typical Board session will take 1 hour where the Chairs

make questions that are answered by the Task Manager of the project
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After Board and Government Approval, the project becomes effective and it is actively supervised by the Bank

CAS

Identification and Preparation

Appraisal and Negotiation

Implementation and Supervision Board

Evaluation

After Board Approval, the project is signed by the

Countrys high authorities and then locally approved, typically by the Congress, a process that takes 6 to 12 months

When all conditions in the PAD are satisfied, the project

becomes effective and begins to disburse

The Task Manager supervises the project making sure that

Bank policies are fulfilled, particularly in procurement of goods and consulting services

During the life of the project, it is periodically evaluated

through the Implementation Status Reports (ISR)
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After closing of the project, it is independently evaluated and the results are included in the ICR

CAS

Identification and Preparation

Appraisal and Negotiation

Implementation and Supervision Board

Evaluation

When project closes, it is independently evaluated to

assess at which degree the goals have been attained

The independent evaluation is consolidated into an

Implementation Completion Report (ICR)

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In summary, the Project Cycle in the Bank has some distinctive characteristics

Lengthy preparation involving the Government as well as

many internal areas of the Bank

The Board is actively involved in project decisions Projects are actually carried out by the Countries, the
World Bank supervises compliance with its rules

Major effort is underway to reform the Banks investment

lending model so that it responds better to borrowers needs and the changing global environment (e.g. single, flexible instrument that can encompass rapid response and emergency operations)
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CONTENTS

The Region The Project Cycle The Challenges

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Implementation of Bank Projects poses challenges compared to typical private sector projects

Private Sector

The Bank

Clearly defined:
Goals
Client satisfaction for generation of income

Poverty reduction
and development, difficulty in measurement

The client
Partners

The client
Government and its internal institutions, Developed countries, NGOs, several internal bodies
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Implementation of Bank Projects poses challenges compared to typical private sector projects (Cont.)

Private Sector

The Bank

Streamlined
Organization
towards achievement of the goal

10,000+ people,
matrix structure with multiple internal bodies

Streamlined
Processes towards achievement of the goal

Multiple internal
processes

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Lessons Learned

Clear identification of the problem

Project concept and objectives are based on stakeholder consensus and Borrower priorities obtained through stakeholder assessments and national working groups

Complexity of clients institutional structure (# of players, organizational structure)

Identify the roles of the various players in the clients intergovernmental framework Serious consideration of/and planning for the coordination necessary for successful implementation.

Incentives

Incentives (rewards) more important than punishments for noncompliance

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Lessons Learned

Pilot interventions

Implementation procedures are tested under pilot interventions with limited scope prior to expansion of the program to nationwide implementation

Absorptive capacity of client Implementation of socio-economic reforms requires large range of government institutions, and are highly technical (requiring specialized information) Overall governmental institutions skills set & ability to implement policies is essential for understanding and implementation Dedicated funding for capacity-building , or follow-on activities.

Linguistic Distance (from English) There are cases where language differences do not matter as much

This emphasizes the prevailing English-based global cultures, especially in technical domains
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Lessons Learned

Resource capacity, cost of implementation

Project should be built on a realistic assessment of implementation capacity is essential

One TTL described the difficulty in aligning the necessary parts: the right resources, the right project timing, the right team.

Political considerations

Political change can slow down and even paralyze project implementation Continuous and wide public dissemination of project objectives and gains might provide a partial insulation from political and budgetary fluctuations.

Actionable Information

Actionable information (or guides) refers to knowing how to do something through description of a task or procedures steps.

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Main Lending Instruments: Investment and Development Policy

Investment Lending
Provides financing for specific expenditures, activities, or outputs Finances capital investment, institutional development, sectoral and local capacity building Appropriate when achieving objectives requires inputs to be linked to outputs

Development Policy Lending

Provides quick disbursing policy-based financing in support of a borrowers program of policy and institutional actions Provides funding directly into the countrys overall budget