The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) Competitiveness for Tourism Development (P146666) AFRICA | Cabo Verde | Finance, Competitiveness and Innovation Global Practice | IBRD/IDA | Investment Project Financing | FY 2016 | Seq No: 7 | ARCHIVED on 12-Dec-2019 | ISR39687 | Implementing Agencies: Ministério das Finanças, Unidade de Gestao de Projectos Especiais (UGPE) Key Dates Key Project Dates Bank Approval Date: 10-May-2016 Effectiveness Date: 15-Nov-2016 Planned Mid Term Review Date: 10-Dec-2019 Actual Mid-Term Review Date: 31-Oct-2019 Original Closing Date: 31-May-2021 Revised Closing Date: 31-May-2021 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective is to create the conditions necessary to increase investment into and diversification of the tourism sector. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Component 1: Enhancing governance framework of the tourism sector:(Cost $2.27 M) Component 2: Diversify tourism sector and increase inclusiveness of tourism-led growth by strengthening the competitiveness of local MSMEs:(Cost $2.24 M) Component 3: Project implementation:(Cost $0.49 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions The Project's implementation progress markedly increased in the last cycle and has now reached a satisfactory level, which is reflected among others by a disbursement rate of 55 percent (by October 31, 2019). One of the key milestones for the project has been the establishment of the Tourism Institute, which is expected to largely address the governance issues which have hindered the sector's coordination and development so far. It will be essential that the Government dedicates adequate funding and resources to operationalize the Tourism Institute, which has a critical mandate to support the sector and coordinate the action of the different stakeholders. In addition, the Project helped develop tourism planning instruments for most of the islands, in the form of Tourism Master Plans (which are island-specific tourism strategies and work plans) and Tourism Zoning Plans (which are zoning plans for some of the designated tourism development zones (ZDTIs) on Santiago and Sal islands so far. These documents represent critical tools to realize the national tourism vision noted 12/12/2019 Page 1 of 6 The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) in the GoPEDS strategic guidelines, and are expected to be strong policy implementation tools in the hands of the Tourism Institute and other stakeholders to frame the development of the sector. In addition, the implementation of the Quality Seal for small accommodations program -- implemented through the Institute for Quality Management and Intelectual Property (IGQPI) -- is also progressing well with a successful pilot during the summer 2019. This activity is now ready to be rolled out in the first quarter of 2020 in selected main islands. This activity is critical in terms of helping locally-owned small accommodations improve standards to compete on the increasingly important independent travelers' market. It is core to the Government's strategy to diversify the sector beyond the all-inclusive hotel type of accommodation. The support of the island and municipal authorities as well as tourism sector stakeholders to this initiative is critical to ensure its success. Finally on the investment climate sub-component, there is encouraging progress as secondary insolvency regulations have been approved, and the overall legal framework is now starting to be effectively used by the judiciary (17 cases have recently entered litigation under the new Law). Further efforts to sensitize businesses and their legal advisors, as well as magistrates about insolvency will be important in mainstreaming such practice in Cabo Verde. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance Moderate Moderate Moderate Macroeconomic Substantial Substantial Substantial Sector Strategies and Policies Moderate Moderate Moderate Technical Design of Project or Program Moderate Moderate Moderate Institutional Capacity for Implementation and Sustainability Moderate Moderate Moderate Fiduciary Moderate Moderate Moderate Environment and Social Moderate Moderate Moderate Stakeholders Moderate Moderate Moderate Other -- -- -- Overall Moderate Moderate Moderate Results PDO Indicators by Objectives / Outcomes Increased investment generated IN00777521 ►Increased investment generated (Amount(USD), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 35.00 Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 IN00777522 12/12/2019 Page 2 of 6 The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) ►Increased bed nights at beneficiary small accommodation establishments (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 18.00 Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 Overall Comments PDO The Project is not yet reporting on the impact in terms of private investment generated in the tourism sector, as a lot of the preparatory work is still underway, including the operationalization of the Tourism Institute, the completion of the land planning in the tourism zones (which will make them "investment-ready"), the completion of the island-by-island tourism master plans, as well as the capacity building for investor outreach. In addition, the MTR mission recommended some changes to strengthen the M&E framework, which would affect PDO-level indicators as follows:  PDO-level Indicator 1 – Increased investment generated ($35 million): According to the original PAD, this indicator means the actual investment made by investors. In reality, the time between the moment the investment license is granted or investment is committed, and the actual groundbreaking, completing construction, fitting the interior, etc. is beyond the control of the project team or its counterparts (MTT). The team recommends revising this indicator to “investment catalyzed” to reflect the nature of the project activities, which enable or catalyze investment. The team further suggests evidence of investment catalyzed to be based on the official records of signed investment conventions or tourism utility licenses, rather than based on actual investment on the ground, as initially assumed. Also, the team suggests breaking down investment by islands to demonstrate the “diversification”.  PDO-level Indicator 2 – Increased bed nights at beneficiary small accommodations (18%): The team further assessed this indicator to be unrealistic because: (i) the first SMEs or small accommodations to get certified with Quality Seal will likely happen in mid-2020 only, leaving limited time before project closure for improvements to take place and translate into additional “bed nights”; and (ii) other efforts to increase the country’s visibility and attract further tourists are also still ongoing and will take time to complete. Therefore, the team suggests either extending the project’s timeline to wait for the outcome to materialize or using a more short-term outcome as a PDO-level indicator. The suggested indicator is “Number of SMES certified with Quality Seal, of which owned or managed by women.” Improving the quality of small establishments or tourism services also speaks for the diversification in terms of accommodation offerings. The team will seek Management endorsement of the proposed changes through Level 2 Restructuring following this MTR in order to adjust the results framework accordingly. Intermediate Results Indicators by Components Component 1: Enhancing governance framework of the tourism sector IN00777523 ►Start-up of operations of the Tourism Institute (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 This indicator has been re-phrased, using the new nomenclature "Tourism Institute" or Instituto do Comments: Turismo, to reflect the new name used by the Govt for the agency in charge of tourism development. IN00777525 ►Development of a national tourism strategy (Yes/No, Custom) 12/12/2019 Page 3 of 6 The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) Baseline Actual (Previous) Actual (Current) End Target Value No Yes Yes Yes Date 10-May-2016 30-Nov-2018 30-Nov-2018 01-Mar-2021 The Govt has adopted the GoPEDS-Turismo (Grandes Opções do Plano Estratégico de Desenvolvimento Sustentável do Turismo no horizonte 2030), which constitutes the Govt's strategy for the development of Comments: the tourism sector. Component 2: Diversify tourism sector and increase inclusiveness of tourism-led growth by strengthening the competitiveness of local MSMEs IN00777524 ►Beneficiaries of the small accommodation quality label that feel project investments reflected their needs (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 75.00 Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 IN00777526 ►Number of MSME representatives trained by private sector organizations (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 17.00 51.00 100.00 Date 10-May-2016 28-Jun-2019 29-Nov-2019 01-Mar-2021 IN00777527 Of which women (%) (Percentage, Custom Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 12.00 42.00 35.00 IN00777528 ►Establishment of a moveable collateral registry (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value No No No Yes Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 IN00777529 ►Number of investor leads receiving improved investment promotion services in the tourism sector (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 18.00 Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 IN00777530 ►Implementation of a formal investor outreach program (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target 12/12/2019 Page 4 of 6 The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) Value No No No Yes Date 10-May-2016 28-Jun-2019 28-Jun-2019 01-Mar-2021 Overall Comments IR Intermediate Indicators. Through the process of developing the results chain, some important intermediate results have been identified which are not yet captured in the Results Framework. The team suggests monitoring these to substantiate that the PDO achievement arose from the activities and outputs of the project. This will strengthen the case and reasonable assessment of plausible attribution. The MTR recommends updating the Intermediate Indicators as follows:  Tourism Master Plans adopted (Number)  Institute of Tourism established and operational (Yes/No)  Tourism Zoning Plans (POTs) adopted (Number)  Investments Forums Organized (Number)  Tourism Code enacted by the Government (Yes/No)  Cruise Tourism Plan approved (Yes/No)  Technical and Feasibility Study of Midelo´s Oceanarium (Aquarium) approved (Yes/No)  Number of national quality auditors accredited (Number)  Legal Framework for Insolvency and collateral registry approved (Yes/No)  Moveable collateral registry established (Yes/No) Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P146666 IDA-58010 Effective USD 5.00 5.00 0.00 2.81 2.30 55% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P146666 IDA-58010 Effective 10-May-2016 17-Jun-2016 15-Nov-2016 31-May-2021 31-May-2021 Cumulative Disbursements 12/12/2019 Page 5 of 6 The World Bank Implementation Status & Results Report Competitiveness for Tourism Development (P146666) Restructuring History Level 2 Approved on 29-Nov-2018 Related Project(s) There are no related projects. 12/12/2019 Page 6 of 6