Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) MW: Mining Governance and Growth Support Project (P120825) AFRICA | Malawi | Energy & Extractives Global Practice | IBRD/IDA | Specific Investment Loan | FY 2011 | Seq No: 9 | ARCHIVED on 29-Dec-2016 | ISR26286 | Implementing Agencies: Ministry Of Natural Resources Energy and Mining Key Dates Key Project Dates Bank Approval Date:31-Mar-2011 Effectiveness Date:23-Aug-2012 Planned Mid Term Review Date:01-Dec-2014 Actual Mid-Term Review Date:05-Dec-2014 Original Closing Date:30-Sep-2016 Revised Closing Date:31-Mar-2018 Project Development Objectives Project Development Objective (from Project Appraisal Document) To improve the efficiency, transparency and sustainability of mining sector management Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Managing Mineral Rights and Operations:(Cost $6.50 M) Generating and Managing Mineral Revenue:(Cost $1.55 M) Promoting the Mining Sector:(Cost $17.00 M) Project Management:(Cost $2.72 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Moderately Satisfactory Overall Implementation Progress (IP)  Moderately Satisfactory  Moderately Satisfactory Overall Risk Rating  Moderate  Moderate 12/29/2016 Page 1 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) Implementation Status and Key Decisions The MGGSP has been effective since August 23, 2012, with a current disbursement rate of 77%. Overall project implementation is rated as Moderately Satisfactory. Implementation Progress: A Strategic Environmental and Social Action Plan was completed in 2015 and its Action Plan was adopted by Government in May, 2016. As a result, the Covenant to the Finance Agreement regarding the SESA has been met. The 1981 Mines and Minerals Act has been reviewed and the Bill and associated regulations have been finalized. The activity suffered a number of delays and is now expected to be tabled in the February 2016 seating of Parliament. Work is in progress to establish a modern computer-based cadastral system with efficient and transparent management of mineral exploration and mining rights. A contract has been awarded and the Consultants have already started implementation. Some of Malawi’s mining licenses are already visible online. The amendments to the Income Tax Act were passed by parliament in June 2016 except for the VAT act. The Bank Team congratulates the EITI Multi Stakeholder Group (MSG) for progress made towards EITI validation. The group is on track to release the first report by April 2017. The MSG has prepared a Scoping Study to define the scope for the first Malawi Extractive Industries Transparency Initiative (MEITI) report and in preparation of the work of the Independent Administrator, who will be assigned to do the reconciliation and write the report. In the first year the focus will be kept on larger companies in order to minimize costs of running MEITI. MEITI funding will be covered by GIZ until early 2017, including 3 Secretariat staff who have now been recruited (a Technical Manager, Communications Officer and Accountant). Additional support is provided under Component B-3 (Building Mineral Revenue Transparency) of MGGSP, including capacity building, consultations and launch of the EITI in Malawi. The Bank team discussed future post-2017 support through the new EGPS (Extractives Global Programmatic Support) Trust Fund, and stressed that Malawi should integrate sustainability of the EITI into Government structures and the budget. Work on establishment of the Geo-Data Management Center commenced with the selected Consultant, GAFAG of Germany. The initial deliverables done in August 2016 were training of officers and presentation of a prototype system. The geo-database will be located in the Geological Survey Department (GSD) library, which has been refurbished under the project. Several activities continue to take place to encourage investment in artisanal and small-scale mining (ASM) such as training, attendance at International ASM Indaba, Skills development, and formation of cooperatives. Other activities under this project include training the police, the Malawi Revenue Authority (MRA) and immigration officials in identification of gemstones. The ASM policy has been developed and is now awaiting approval by cabinet committee. Courses have been introduced at The Malawi Polytechnic and MUST in the mining related fields such as Mining Engineering and Geology. A curriculum review is also underway at Chancellor College to ensure that the courses offered by these institutions meet the potential market demand for the skills in the mining sector Procurement under the project has been rated as Satisfactory as many contracts have been signed, are being implemented and deliveries have been made for goods and services. Financial Management arrangements for the project have been rated Satisfactory and risk has been assessed as substantial. The accounting package that the project is using for processing transactions and producing reports has now been configured and customized. The project is now current on all IFRs as well as audited financial statements, the latest audited accounts being for the year ended June 30, 2015 which were submitted late on January 14, 2016 after the dead line date of December 31, 2015. 12/29/2016 Page 2 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  Substantial  Substantial Macroeconomic  --  Moderate  Moderate Sector Strategies and Policies  --  Moderate  Moderate Technical Design of Project or Program  --  Moderate  Moderate Institutional Capacity for Implementation and Sustainability  --  Substantial  Substantial Fiduciary  --  Moderate  Moderate Environment and Social  --  Substantial  Substantial Stakeholders  --  Moderate  Moderate Other  --  --  -- Overall  --  Moderate  Moderate Results Project Development Objective Indicators 12/29/2016 Page 3 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) PHINDPDOTBL  Efficiency - Days taken to issue mineral rights (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 90.00 94.00 94.00 45.00 Date 23-Aug-2012 02-Jun-2016 02-Jun-2016 23-Aug-2017 PHINDPDOTBL  Transparency - Annual public reporting of mineral sector tax revenues (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Value no Yes Yes yes Date 23-Aug-2012 02-Jun-2016 02-Jun-2016 30-Mar-2018 PHINDPDOTBL  Sustainability - Percentage of mining operations subjected to environmental certification (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 50.00 100.00 100.00 90.00 Date 23-Aug-2012 02-Jun-2016 02-Jun-2016 30-Mar-2018 Overall Comments Intermediate Results Indicators PHINDIRITBL  Modern mining legislation in place (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The Draft Mines and The Mines and Minerals Minerals bill has been Act has been reviewed Mining Policy in place but finalized. The draft bill and the Bill and new mining act and New mining is being reviewed by associated regulations regulations, amended regulations Ministry of Justice and have been finalized. The Value mineral taxation legislation submitted to is expected to be activity suffered a and model mining relevant tabled in Parliament in number of delays and is agreement still under authorities June 2016. now expected to be development The Mining Law tabled in the February regulations have been 2016 seating of 12/29/2016 Page 4 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) drafted and are under Parliament. review (and expected to be completed after the bill is approved). Date 23-Aug-2012 02-Jun-2016 06-Dec-2016 30-Mar-2018 PHINDIRITBL  Modern computerized mining cadastre in use (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target A contract has been Selection for the awarded and the Consultant to develop Consultants have the Mining Cadastre is already started Minerals licensing underway, as is implementation. Some Computerized Value conducted using slow and procurement for of Malawi’s mining cadastre in use paper based system building refurbishments licenses are already at the Cadastre Office. visible online. Building refurbishment works have commenced. Date 23-Aug-2012 02-Jun-2016 05-Dec-2016 30-Mar-2018 PHINDIRITBL  Multi-stakeholder forum on mining sector established with civil society participation (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Multi-stakeholder The EITI Multi consultations were Stakeholder Group delivered as part of the (MSG) has made Regular SESA. progress towards EITI meetings of Ad hoc and reactive As a Candidate EITI validation. The group is multi- Value arrangements for country, the Multi on track to release the stakeholder stakeholder dialogue Stakeholder Group first report by April forum taking (MSG) has been 2017.The MSG place formed and is meeting continues to meet on a on a quarterly basis. quarterly basis. Date 23-Aug-2012 02-Jun-2016 06-Dec-2016 30-Mar-2018 12/29/2016 Page 5 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) PHINDIRITBL  Health, safety, environmental and social management policies and monitoring systems completed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The Policy Framework for Safety, The Policy Framework Policy Gaps exist in policy environmental and for Safety, framework framework and monitoring Value social management environmental and complete and systems are in need of has been delivered social management has monitoring significant strengthening under the Action Plan is in place. system in place from the SESA. Date 23-Aug-2012 02-Jun-2016 06-Dec-2016 30-Mar-2018 PHINDIRITBL  Standardized fiscal regime (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Standardized royalty Standardized royalty Standardized Royalty and tax terms and tax laws and and tax laws and royalty and tax Value open to negotiation and regulations drafted. regulations drafted. laws and selective concession Target Achieved. Target Achieved. regulations drafted Date 23-Aug-2012 02-Jun-2016 02-Jun-2016 30-Mar-2018 PHINDIRITBL  Mineral tax administration and revenue management developed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The mineral tax administration and revenue management manual & model have The tabling in parliament been developed and has delayed. The next are in use. Policies to session of parliament No specialized The development of address now is February 2017. arrangements for minerals related policies revenue Value The Ministry of Justice is tax administration and (Standardized royalty volatility and incorporation EITI revenue management and tax laws and savings issues. regulations) are introduced drafted. They are expected to be debated in Parliament during the June 2016 sitting. Date 23-Aug-2012 02-Jun-2016 06-Dec-2016 30-Mar-2018 12/29/2016 Page 6 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) PHINDIRITBL  Geo-data management center providing online access (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Up-to-date geo-data is The Consultant, GAFAG in place. and can be has made initial accessed manually at deliverables: training of Geo-data GSD. officers and presentation management A Firm is delivering the Only old and insufficient of a prototype system. centre in Value design and installation geo-data available The geo-database will operation and of the on-line be located in the GSD accessible on- geological database library, which has been line that will be housed at refurbished under the the refurbished project. Geodata Center. Date 30-Aug-2012 02-Jun-2016 02-Jun-2016 30-Mar-2018 PHINDIRITBL  Number of students newly enrolled in mining-related tertiary education programs in Malawi (with breakdown by gender) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 42.00 262.00 262.00 150.00 Date 31-Dec-2010 02-Jun-2016 02-Jun-2016 30-Mar-2018 Comments 68 female and 192 male beneficiaries PHINDIRITBL  Number of public service personnel trained in sector-relevant fields (with breakdown by gender) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 199.00 199.00 115.00 Date 23-Aug-2012 02-Jun-2016 02-Jun-2016 30-Mar-2018 Comments 37 female, 162 male beneficiaries Overall Comments Data on Financial Performance 12/29/2016 Page 7 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P120825 IDA-49010 Effective USD 25.00 25.00 0.00 19.18 4.02 77% P120825 TF-12935 Closed USD 3.10 3.10 0.00 2.88 0.66 93% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P120825 IDA-49010 Effective 31-Mar-2011 02-Nov-2011 23-Aug-2012 30-Sep-2016 31-Mar-2018 P120825 TF-12935 Closed 13-Aug-2012 22-Aug-2012 23-Aug-2012 17-Nov-2015 17-Nov-2015 Cumulative Disbursements Restructuring History Level Approved on 04-May-2012 ,Level 2 Approved on 11-May-2016 12/29/2016 Page 8 of 9 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report MW: Mining Governance and Growth Support Project (P120825) Related Project(s) There are no related projects. 12/29/2016 Page 9 of 9 Public Disclosure Copy