The World Bank Report No: ISR15704 Implementation Status & Results Bangladesh BD Private Sector Development (P120843) Public Disclosure Copy Operation Name: BD Private Sector Development (P120843) Project Stage: Implementation Seq.No: 7 Status: ARCHIVED Archive Date: 23-Oct-2014 Country: Bangladesh Approval FY: 2011 Product Line: IBRD/IDA Region: SOUTH ASIA Lending Instrument: Specific Investment Loan Implementing Agency(ies): Key Dates Board Approval Date 01-Mar-2011 Original Closing Date 30-Jun-2016 Planned Mid Term Review Date 22-Jun-2014 Last Archived ISR Date 15-Mar-2014 Effectiveness Date 03-Aug-2011 Revised Closing Date 30-Jun-2016 Actual Mid Term Review Date 01-Jul-2014 Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objective (PDO) is to facilitate investment in growth centers in the emerging manufacturing and services sectors of the economy with the aim of generating employment. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) Component Name Component Cost Technical Assistance and Capacity Building 12.70 Public Investment Facility (PIF) 29.50 Business Linkages and Product/Process Improvement 9.99 Overall Ratings Previous Rating Current Rating Public Disclosure Copy Progress towards achievement of PDO Moderately Unsatisfactory Moderately Unsatisfactory Overall Implementation Progress (IP) Moderately Unsatisfactory Moderately Unsatisfactory Overall Risk Rating Substantial Substantial Implementation Status Overview The IDA Credit for the Private Sector Development Support Project (PSDSP) became effective in August 2011, and the project was restructured in June 2013 to address lessons learned during the first two years of implementation. The project is being implemented by the Bangladesh Economic Zones Authority (BEZA), Bangladesh Export Processing Zones Authority (BEPZA), and the Bangladesh Hi Tech Park Authority (BHTPA) and coordinated by a central unit (Central Coordination Unit – CCU) housed in the Economic Relations Division (ERD). Page 1 of 5 The World Bank Report No: ISR15704 A mid-term review was carried out in July 2014 which found that: the Project Development Objective is still relevant and is aligned with the current CAS and GoB priorities; the technical design of the project, as revised in July 2013, remains appropriate; and capacity constraints at the implementing agency level, while of concern, are being addressed by contracting transaction advisors. Safeguards and fiduciary issues have been identified and a plan established to deal with the issues; both third-party monitoring and M&E services will soon be contracted. Public Disclosure Copy At this mid-point in implementation, achievement of the Project Development Objective is considered to be at an elevated risk level within the current time frames of the project. Activities under the Hi-Tech Park Authority (HTPA) have made progress and are showing encouraging signs of licensing the first SEZs/Hi-Tech Parks. This will be an important step towards registering new private investments in zones and creating jobs. Significant delays related to activities managed by BEZA may lead to further restructuring of project scope and reallocation of funds in the coming months. Locations Country First Administrative Division Location Planned Actual Bangladesh Not Entered Gazipur District Bangladesh Not Entered Chittagong Bangladesh Not Entered Kaliakoir Hi-Tech Park Results Project Development Objective Indicators Indicator Name Core Unit of Measure Baseline Current End Target Direct private investment in new zones Amount(USD) Value 0.00 0.00 10.00 (cumulative) Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments US$ Million US$ Million US$ Million The private investment in zones was always expected to be towards the very end of a 5 year infrastructure project. $10mil end target is still very achievable even with 1 zone Public Disclosure Copy under development. Number of jobs created (No.) & of which Percentage Value 0.00 301.00 2000.00 female employment (%) Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments 2000 job placements by FY16 Of which Female employment are very plausible given that % (min target 30%) the project has already begun the process to "train with placement" 2200 candidates Page 2 of 5 The World Bank Report No: ISR15704 in the next 9 months. 29% of these are female. Direct private investment by zone tenant Amount(USD) Value 0.00 0.00 10.00 companies located within new zones Public Disclosure Copy Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments Tenant investment is at the very end of the project and $10mil is possible with just 2 modest tenants investing in plant, equipmentand fit outs in 1 zone. At this point this DO is the most challenging, but still achievable in Jessore. Intermediate Results Indicators Indicator Name Core Unit of Measure Baseline Current End Target Cumulative number of firms receiving a license Number Value 0.00 0.00 5.00 to develop an economic zone Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments The target in FY14 was 1 and FY15 is 3. Two licenses are expected to be issued by Dec 2014 and 4 by end FY15. Completed site assessments, master plans, Number Value 1.00 4.00 6.00 EIAs, and SIAs for new zones Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments The baseline is the feasibility This RI is on track and project study for Kaliakor directly end target also expected to funded by DFID TF in 2010. be achieved (and exceed) by FY16. Time (days) to process business registration in Number Value 44.00 8.00 9.00 a zone. Date 03-Aug-2011 15-Jul-2014 30-Jun-2013 Comments Baseline number represents According to IFC DB Pub BEPZA will monitor quarterly Public Disclosure Copy the prevailing norm outside 2014 countrywide average is what tangible difference their zone regime as per IFC DB, 10.5 days. BEPZA facilitation new IT systems and 2010 plus 1 day is 8 days for facilitation is bring to reduce companies within BEPZA Co. registration "burden" EPZs. NOTE: This improvement is not entirely attributable to automation from PSDSP. Development of new economic zones or tech Number Value 0.00 1.00 3.00 parks (in progress) Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Page 3 of 5 The World Bank Report No: ISR15704 Comments Jessore tech park At least 1 zone will be open construction has begun. OI on for business (even partially track. complete) and tenancy Kaliakoir enabling works are agreement signed Public Disclosure Copy underway but not accounted for above. Cumulative number of people receiving Number Value 0.00 1513.00 2000.00 industry specific training or certification Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments 1513 have been trained as compared with a total 2000 target by project end. This has exceeded target by a significant margin. Cumulative number of firms located in Number Value 0.00 0.00 15.00 economic zones complying with relevant Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 environmental standards (ISO 14000 or Comments BEPZA has commenced this equivalent) activity and are expected to complete 10 certifications by End December 2014, which is the full FY15 target. Cumulative number of firms complying with Number Value 19.00 20.00 30.00 Quality standards (ISO 9001 or equivalent) Date 03-Aug-2011 15-Jul-2014 30-Jun-2016 Comments The number of companies in Target for FY14 was 23 the ICT sector in Bangladesh (Cumulative) however only 1 with ISO 9001 or equivalent has ISO 9001 certification certification already (20 Cumulative). End FY15 we expect to record 47 actual certifications compared to a target of 27 cumulative. Data on Financial Performance (as of 03-Jun-2014) Public Disclosure Copy Financial Agreement(s) Key Dates Project Ln/Cr/Tf Status Approval Date Signing Date Effectiveness Date Original Closing Date Revised Closing Date P120843 IDA-48660 Effective 01-Mar-2011 22-May-2011 03-Aug-2011 30-Jun-2016 30-Jun-2016 P120843 TF-99730 Effective 08-Jul-2011 08-Jul-2011 08-Jul-2011 31-Dec-2014 31-Dec-2014 Disbursements (in Millions) Project Ln/Cr/Tf Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P120843 IDA-48660 Effective USD 120.00 42.79 77.21 13.92 27.19 33.00 Page 4 of 5 The World Bank Report No: ISR15704 P120843 TF-99730 Effective USD 17.41 17.41 0.00 4.97 12.44 29.00 Disbursement Graph Public Disclosure Copy Key Decisions Regarding Implementation An action plan has been agreed with the three implementing agencies to get the project on a more positive performance trajectory; progress will be assessed in October to determine whether further adjustment of project design is warranted. The October 2014 stock-taking will also contribute to DFID’s decision whether to approve a no-cost extension for its co- financing grant. Key actions in the action plan are: (i) GoB to ensure that key management positions in the implementing agencies are assigned to appropriately qualified professional personnel at the earliest point in time; (ii) BEZA Board of Governors to approve the EZ Policy for the licensing of 100% private economic zones (after vetting is completed); (iii) BEZA to grant the first license for a private sector-led zone; and (iv) HTPA to grant at least one license to a developer for Kaliakor HTP and to a management company for Jessore multi-tenanted building. Restructuring History Public Disclosure Copy Level two Approved on 20-Jul-2013 Related Projects There are no related projects. Page 5 of 5