Implementation Status & Results Ghana Ghana Commercial Agriculture (P114264)

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1 Public Disclosure Authorized Public Disclosure Authorized Implementation Status & Results Ghana Ghana Commercial Agriculture (P114264) Operation Name: Ghana Commercial Agriculture (P114264) Project Stage: Implementation Seq.No: 4 Status: ARCHIVED Archive Date: 16-Sep-2014 Country: Ghana Approval FY: 2012 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Original Closing Date Planned Mid Term Review Date 19-Jan-2015 Last Archived ISR Date 06-Apr-2014 Effectiveness Date 08-Apr-2013 Revised Closing Date Actual Mid Term Review Date Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective (PDO) is: increased access to land, private sector finance, input- and output-markets bysmallholder farms from private-public partnerships in commercial agriculture in Accra Plains and SADA zone. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) losure Authorized Public Disclosure Authorized Component Name Component Cost Component 1: strengthening investment promotion infrastructure, facilitating secure access to land and project management. Component 2: Securing PPPs and small-holder linkages in the Accra Plains Component 3: securing PPPs and small-holder linkages in the SADA zone Component 4: Project management and monitoring and evaluation Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Satisfactory Moderately Unsatisfactory Overall Risk Rating Moderate Substantial Implementation Status Overview The third Implementation Support Mission which was carried out during June 23-July 11, 2014 consisted of the following activities: (a) review of the status of agreed actions following the second ISM (December 2013) as captured in the latter s aide memoire; (b) review of the procurement plan with the view of speeding up project implementation; (c) assessment of the financial management performance of the project; (d) review of the final report of the pre-feasibility study for the proposed Accra Plains irrigation public-private partnership Page 1 of 7

2 (PPP) and assess the prospects for the proposed investment; (e) assessment of progress on M&E and impact analysis; (f) field visits to the Accra Plains, Northern Region (Nasia- Nabogu valley and Sisili-Kulpawn area) and Upper East region; and (g) assessment of the relevance of the original project design in light of experience gathered thus far, derive conclusions and implications, and recommended appropriate action. The majority of the agreed actions listed in the aide memoire of the second ISM were implemented to different extents. In particular advancements were made with a number of key consultancies, including completion of the pre-feasibility report for the proposed Accra Plains irrigation PPP and preparation of the TORs for the full feasibility study; and progress in the development of a national framework for out-grower and contract farming arrangements, model land lease agreement, strategic plan for promoting agricultural investments, technical feasibility study of land development in the Nasia and Nabogu Valley, and land banks. In addition, a modernization plan for the Ghana Irrigation Development Authority was completed. The first round of the matching grant scheme was also awarded to 31 grantees for a total of USD 9.5 million. Despite the above achievements, the Mission identified a number of serious shortcomings in both the original project design and subsequent project implementation. These shortcomings evolve mainly around the proposed investments in irrigation - which is a fundamental requirement in large-scale commercial agriculture development - and the matching grant scheme. The Accra Plains irrigation PPP investment as proposed in Component 2 of the project remains surrounded by many uncertainties, in particular those related to land access and private investors interest. The PPP as envisaged in the original project document does not seem achievable in the project s remaining implementation period. In addition, there were a number of serious shortcomings in the implementation of the first round of the matching grant scheme. These shortcomings relate to eligibility criteria as advertised in the call for proposals, process followed in evaluating grant applications, and due diligence exercised for awarded proposals. Locations Country First Administrative Division Location Planned Actual Ghana Northern Region Northern Region Ghana Greater Accra Region Greater Accra Region Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Yield per hectare of major crops on nucleus Metric ton Value farms and in out-grower schemes (disaggregated: by crop: maize, rice, soya, and by Accra Plains/SADA zone) Area under formal commercial arrangements Hectare(Ha) Value (disaggregated by nucleus farms and outgrower schemes, Accra Plains/SADA zone, farm size) Page 2 of 7

3 Formal and/or semi-formal marketing Number Value 0.00 arrangements for smallholder farms (disaggregated by Accra Plains/SADA zone, farm size, formal/semi-formal) Gross Margins of selected crops Amount(USD) Value (disaggregated by: Accra Plains, SADA zone) Direct project beneficiaries Number Value The project does not have activities on the ground yet. Female beneficiaries Percentage Sub Type Supplemental Value Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Protocol/framework for dealing with investors at Yes/No Value No No Yes agricultural sector level established (Component 1) The various consultancies that will contribute to the framework are underway. Area entered in the Land bank (Component 1) Hectare(Ha) Value The consultancy for the design of the land bank is currently underway and progressing satisfactorily. Model lease agreement developed Yes/No Value No No Yes (Component 1) Date 22-Mar-2012 The consultancy for the design the model lease Page 3 of 7

4 Framework for out-grower scheme developed (Component 1) Accra Plain PPP transaction is closed (Component 2) Smallholder participation in Accra Plain PPP (% of smallholder project area) (Component 2) Formal jobs directly created in PPP arrangements (disaggregated by storage, agribusiness, nucleus farms, etc.) (Component 2) agreement is underway and progressing satisfactorily. Yes/No Value No No Yes The consultancy for developing a national framework for out-grower and contract farming arrangements is underway and progressing satisfactorily. Yes/No Value No No Yes TORs for the full PPP feasibility study have been developed and an REOI has gone out. This indicator will need to be adjusted as part of project restructuring. Percentage Value Feb Mar-2017 The Accra Plains PPP is unlikely to be implemented during the remaining life of GCAP and therefore this indicator will likely be dropped as part of project restructuring. Number Value contracts with nucleus farm recipients of matching grants only last July. Nine of these are in the Accra Plains and 22 in SADA zone. Page 4 of 7

5 Farmers and others who have applied Percentage Value improved technologies or management practices (disaggregated: Accra Plains/SADA zone, farm size, technology, irrigated/rainfed, sex) (Component 2 and 3) Public-private partnerships closed in SADA Number Value zone (Component 3) The aerial survey of 400,000 hectares is completed. The consultancy regarding selection of the first 20,000 hectares has started. Aconsultant has been selected to carry out the prefeasibility study for PPP in warehouses/storage. Total storage capacity (Component 3) Metric ton Value A consultant has been selected to carry out the prefeasibility study for PPP in warehouses/storage. Total value of private sector participation in Amount(USD) Value PPP as a direct result of GCAP implementation (dis-aggregated by region) (Component 3) Amount GHc Project has not yet reached that stage yet. Value of incremental sales (collected at farmlevel) Percentage Value attributed to GCAP implementation (Component 2 and 3) Baseline under preparation Project has not yet reached that stage yet. Data on Financial Performance (as of 18-Jul-2014) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P IDA Effective 22-Mar Sep Apr-2013 Disbursements (in Millions) Page 5 of 7

6 Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P IDA Effective XDR Disbursement Graph Key Decisions Regarding Implementation Based on the findings of the third ISM, the project is in need of restructuring which is proposed along the following three lines: (i) Re-thinking of strategy towards proposed Accra Plains irrigation PPP (which covers the existing Kpong Irrigation Scheme (KIS) plus the proposed New Development Irrigation Scheme (NDIS)) by dividing the corresponding project component into two parallel phases: (a) rehabilitation/modernization of the KIS, plus restructuring/modernization of the Ghana Irrigation Development Authority (GIDA) including the creation of acceptable management mechanisms before physical investments are made; (b) NDIS full feasibility study to run in parallel with identification of private investors interested in sharing capital costs (market test of investor interest). In addition, immediate measures must be identified to work out modalities for a management entity which would maintain and operate the rehabilitated and modernized KIS. In this regard, the progress achieved so far in developing a modernization plan for GIDA is important - including a proposal to transfer the responsibility of irrigation management to private sector entities including Water Users Associations, and whose implementation will be supported by GCAP. (ii) New focus on rehabilitation of selected smaller irrigation schemes. There exists a number of other non-performing irrigation assets in both the Accra Plains and the SADA zone, rehabilitation and modernization of which presents a profitable entry point for GCAP investment. An inventory of such assets should be undertaken immediately by GCAP, followed by the studies and designs required to rehabilitate/modernize these assets with physical interventions. (iii) Incorporating lessons learnt from the first round of the matching grant scheme. These relate to shortcomings in eligibility criteria as advertised in the call for proposals, process followed in evaluating proposals, and due diligence exercised for awarded proposals. Despite the fact that a number of these shortcomings resulted in part from the considerable time and disbursement pressure faced by the project, they need to be rectified immediately and lessons need to be drawn from the experience gained for future matching grant rounds. GCAP needs to review the grants screening process and due diligence reports on the grantees, and rectify non-compliance with national and/or World Bank safeguards requirements found among a number grant awardees. Restructuring History Page 6 of 7

7 There has been no restructuring to date. Related Projects There are no related projects. Page 7 of 7