The World Bank Report No: ISR9885 Implementation Status & Results Tajikistan Cotton Sector Recovery Project (P098889) Public Disclosure Copy Operation Name: Cotton Sector Recovery Project (P098889) Project Stage: Implementation Seq.No: 10 Status: ARCHIVED Archive Date: 31-Mar-2013 Country: Tajikistan Approval FY: 2007 Product Line: IBRD/IDA Region: EUROPE AND CENTRAL ASIA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 30-May-2007 Original Closing Date 31-Mar-2013 Planned Mid Term Review Date 18-Apr-2011 Last Archived ISR Date 26-Dec-2012 Effectiveness Date 28-Sep-2007 Revised Closing Date 31-Mar-2013 Actual Mid Term Review Date 25-Apr-2011 Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project development objective will be changed to "benefit cotton farmers and create the conditions for sustainablegrowthofcott o n production in low income areas of Tajikistan through improved policy environment an better access to finance". Has the Project Development Objective been changed since Board Approval of the Project? � Yes No Component(s) Component Name Component Cost Debt Resolution 0.00 Support for Policy Analysis and Reform 0.70 Cotton Supply Chain Development 0.00 Project Implementation 1.40 Agriculture Finance and Producer Support 12.90 Public Disclosure Copy Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Satisfactory Moderately Satisfactory Overall Risk Rating Moderate Moderate Implementation Status Overview Overall the project development objective has been achieved in creating an enabling environment for cotton production in low income areas of Khalton Oblast. Important policy reforms have been achieved under the support to policy analysis and reform component that led to substantial progress in cotton farm debt resolution, and agrarian reform Page 1 of 5 The World Bank Report No: ISR9885 discussion. Freedom to farm is now a reality as confirmed by the farmers interviewed during the recent supervision mission. With support of the project a high-level Working Group on Agricultural Reform of Government and Development Partner experts was created to help design a comprehensive agriculture reform strategy, notably in: (i) water and irrigation, (ii) land reform, (iii) new mechanisms for agricultural financing, (iv) rural social development, (v) local government Public Disclosure Copy reform, and (vi) cotton debt write-off. This has led to the acceptance of the need for “freedom to farm� as a further building block for cotton sector reform, and reduction of local government intervention in farmer decisions, has been advanced as a result of project activity along with Land Registration and Cadastral System Project also financed by the Bank. The farmers’ debt write-off is also a considerable progress and constitutes a critical step forward in the development of a more diverse and balanced agriculture sector. The post-harvest financing scheme provided an alternative to government funded credit lines and facilitated government agreement to phase out this publicly funded source of agricultural credit. Previously, ginneries would not have to be open about their pricing as they were tied to the financing provided by cotton fiber exporters. Under this sub- component, subsidiary loans worth USD 10.4 million (100% of available funding) were disbursed through two local participating financial institutions (PFIs) to eleven ginneries in August-September 2011 for seed cotton purchases from farmers in the 2011-2012 season, including the five million USD from the roll-over account of the 2010-2011 cotton season. The loan repayment is 100%. In 2011-2012 season about 13,400 tons of seed cotton was purchased against 7,000 tons in 2010-2011, the first year of implementation of the financing scheme. Also, following the successful implementation of the cotton post-harvest financing scheme in the first two years since project restructuring, the PFIs have started using the roll-over funds to finance other eligible activities, such as production of cotton, potatoes, grains, livestock, poultry, food processing, etc. Despite lower international cotton prices in the recent marketing year compared with 2010-2011, the average seed cotton price paid to farmers actually increased from USD 701 per one ton in 2010-2011 to USD 775 per one ton in 2011-2012 (+11%). This was largely due to increased competition amongst participating ginneries and their anticipation of higher international cotton prices later in the 2011-2012 marketing year. The Producer Support sub-component has also made significant progress with four training information centers (TIC) established, registered as legal entities under the authority of the local khukumats, and operational. In combination with the demonstration plots, the TICs have provided much needed training to farmers. Starting from January I, 2013 the TIC operate independently and are self-financing organizations. The PMU supported TICs in obtaining specific license from the Ministry of Education of the Republic of Tajikistan, to authorize them to provide trainings and give certifications to tractor operators, agronomists and accountants with professional computer user skills. In total, the TICs have been able to accumulate about 40,000 TJS in the last 7 months. Locations Country First Administrative Division Location Planned Actual Tajikistan Not Entered Yavanskiy Rayon Tajikistan Not Entered Vakhshskiy Rayon Tajikistan Not Entered Shaartuzskiy Rayon Public Disclosure Copy Tajikistan Not Entered Parkharskiy Rayon Tajikistan Not Entered Kumsangirskiy Rayon Tajikistan Viloyati Khatlon Bokhtarskiy Rayon Tajikistan Not Entered Kabodiyenskiy Rayon Results Project Development Objective Indicators Page 2 of 5 The World Bank Report No: ISR9885 Indicator Name Core Unit of Measure Baseline Current End Target 20,000 farmers receiving at least 80% of the Number Value 3000.00 12000.00 20000.00 world market price for their cotton output Date 04-May-2007 15-Mar-2013 31-Mar-2013 Public Disclosure Copy Comments The current figure is from the As indicated in the mid-term review assessment comparable farm survey data. of April 2011. Another assessment is being carried out and should be available at the time of ICR. The figure will be consequently revised. Collaborative research/extension sub-projects Number Value 0.00 4.00 4.00 under implementation/completed Sub Type Date 29-Aug-2012 15-Mar-2013 31-Mar-2013 Breakdown Comments Core sector indicator on Four demonstration plots Target achieved. number introduced as per have been established for Management instruction. both research and training Client days of training provided (number) Number Value 0.00 447.00 400.00 Sub Type Date 28-Sep-2012 15-Mar-2013 31-Mar-2013 Breakdown Comments New core indicator introduced Figure from October mission as per Management instruction. Baseline was not available Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Policy Advisor in place, collaborating actively Text Value Policy Advisor not in place Policy was in place and Policy Advisor in Place with staff of President#s Office completed his assigment as planned. However, the project has continued providing assistance for policy reform through the secretariat put in place to oversee the reform Public Disclosure Copy process. Date 04-May-2007 15-Mar-2013 31-Mar-2013 Comments Six working groups have been established and are working on agricultural reform. This has helped move the reform agenda. Page 3 of 5 The World Bank Report No: ISR9885 Termination of the policies that support local Text Value 70% of farmers reporting free The policies of forcing farmers 90% of farmers reporting free processing and marketing monopsonies and Sub Type in their choice of financing to produce cotton and sell to in their choice of financing restrict farmer ability to use their land freely sources; some indicated ginners have sources; Breakdown 65% of farmers report that been terminated. As a result 80% of farmers report that Public Disclosure Copy they are free to choose the freedom to farm, to sell cotton they are free to choose the gin fortheir cotton crop; is now a reality. Most of gin fortheir cotton crop; 52% of farmers report that farmers interviewed during 75% of farmers report that the local government does not the recent mission confirmed the local government does not prescribe what area should be they are free to choose what prescribe what area should be allocated to cotton. crops to plant and to sell the allocated to cotton. seed cotton to the ginners of their choice. Impact evaluation underway will inform on the percentage of these farmers. Date 04-May-2007 15-Mar-2013 31-Mar-2013 Comments This estimate is based on field interviews carried out during the SPN mission. A formal survey has not been done yet. However, it is quite visible that most of the farmers are now free to choose. Improved access to finance through the Text Value Not yet established Credit line is fully operational Credit line fully utilized establishment of a revolving credit line for post with 100% allocation of $10.4 harvest finance for cotton in selected project million used with 100% area recovery rate for the two past cotton harvestseason. The scheme has also been extended to non-cotton activities. Date 14-Dec-2009 02-Nov-2012 31-Mar-2013 Public Disclosure Copy Comments The establishment of the The financing scheme is in credit line was introduced at place and working. The the time of of restructuring of financing scheme has been the project in Dec. 2009 extended to other non cotton activities. The loan repayment is now 100% as of March 15, 2013. Volume of credit lines Amount(USD) Value 0.00 10.40 10.40 Sub Type Supplemental Page 4 of 5 The World Bank Report No: ISR9885 Data on Financial Performance (as of 27-Feb-2013) Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date Public Disclosure Copy P098889 IDA-43140 Effective 30-May-2007 29-Jun-2007 28-Sep-2007 31-Mar-2013 31-Mar-2013 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P098889 IDA-43140 Effective XDR 10.00 10.00 0.00 9.41 0.59 94.00 Disbursement Graph Key Decisions Regarding Implementation Public Disclosure Copy None at this time. Restructuring History Level one Approved on 09-Feb-2010 Related Projects There are no related projects. Page 5 of 5