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33 Pages·2017·1.11 MB·English

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P AFRICAN DEVELOPMENT BANK
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COUNTRY : REPUBLIC OF SENEGAL

PROJECT APPRAISAL REPORT
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RDGW

September 2018

Translated Document
TABLE OF CONTENTS

Project Summary ............................................................................................................................ v
I. Strategic Orientation and Rationale ..................................................................................... 1
1.1 Project Linkages with Country Strategy and Objectives ............................................ 1
1.2 Rationale for Bank Intervention .................................................................................... 1
1.3 Aid Coordination ............................................................................................................. 2
II. Project Description ................................................................................................................. 3
2.1. Description of the first operation of the Emergency Community Development
Programme Phase 2 ................................................................................................................... 3
2.2. Objectives of the first operation of the Emergency Community Development
Programme Phase 2 ................................................................................................................... 4
2.3. Description of the Bank’s Intervention ......................................................................... 4
2.4. Technical Solutions Adopted and Alternatives Considered ........................................ 5
2.5. Project Type ..................................................................................................................... 6
2.6. Project Cost and Financing Arrangements ................................................................... 6
2.7. Project Area and Beneficiaries ....................................................................................... 8
2.8. Participatory Approach to Project Identification, Design and Implementation,
including the private sector and civil society ........................................................................... 8
2.9. Bank Group Experience and lessons learned from Project Design ............................ 8
2.10. Key Performance Indicators ....................................................................................... 9
III. Project Feasibility ................................................................................................................... 9
3.1. Economic and Financial Performance............................................................................ 9
3.2. Environmental Impact .................................................................................................. 10
IV. IMPLEMENTATION .......................................................................................................... 13
4.1. Implementation Arrangements ........................................................................................ 13
4.2. Project Monitoring ........................................................................................................ 15
4.3. Governance..................................................................................................................... 16
4.4. Sustainability .................................................................................................................. 16
4.5. Risk Management .......................................................................................................... 17
4.6. Knowledge Building ...................................................................................................... 17
5. LEGAL FRAMEWORK ..................................................................................................... 17
5.1. Legal Instrument ........................................................................................................... 17
5.2. Conditions for Bank Intervention ................................................................................ 18
5.3. Compliance with Bank Policies .................................................................................... 18
6. RECOMMENDATION ....................................................................................................... 18

Annex 1: Comparative Socio-economic Indicators of Senegal ....................................................... I
Annex 2: Table of Bank Portfolio in Senegal as at 30 June 2018 ................................................... II
Annex 3: Map of Project Area ...................................................................................................... IV
CURRENCY EQUIVALENTS

(July 2018)

UA 1 = XOF 791.41
UA 1 = EUR 1.20
UA 1 = USD 1.41

FISCAL YEAR

1 January – 31 December

WEIGHTS AND MEASURES

1 kilometer (km) = 1 000 m
1 km² = 1 000 000 m²
1 hectare (ha) = 10 000 m²
1 tonne = 1 000 kg
1 kilojoule (kJ) = 1 000 Joule (J)
1 kilovolt (kV) = 1 000 Volt (V)
1 kilovolt-ampere (kVA) = 1 000 Volt – Ampere (VA)
1 kilowatt (kW) = 1 000 Watt
1 Megawatt (MW) = 1 000 000 W = 1 000 kW
1 Gigawatt (GW) = 1 000 000 kW = 1 000 MW
1 kilowatt hour (kWh) = 1 000 Watt hour = 3 600 000 Joules (J)
1 Megawatt hour (MWh) = 1 000 000 Wh = 1 000 kWh
1 Gigawatt hour (GWh) = 1 000 000 kWh = 1 000 MWh
1 tonne of oil equivalent (Toe) = 41 868 Joules = 11 630 kWh
1 million tonnes of oil equivalent (MToe) = 1 000 000 Toe
ACRONYMS AND ABBREVIATIONS

ADF : African Development Fund
AfDB : African Development Bank
AGEROUTE : Road Management Agency
ANCAR : National Rural Agricultural Council Agency
ANRAC : Agence Nationale pour la relance des activités en Casamance
ARD : Regional Development Agency
AVC : Agricultural Value Chain
BD : Bidding Document
CIF : Collective Interest Fund
CSP : Country Strategy Paper
DCFE : Department of Cooperation and External Financing
DEEC : Department of Environment and Classified Institutions
DTS : Deconcentrated Technical Services
FDL : Local Development Fund
FERA : Autonomous Road Maintenance Fund
GIS : Geographic Information System
GVT : Government
IFAD : International Fund for Agricultural Development
IsDB : Islamic Development Bank
ITA : Institute of Food Technology
LA : Local Authority
MAER : Ministry of Agriculture and Rural Equipment
MEFP : Ministry of the Economy, Finance and Planning
MFFG : Ministry of Women’s Affairs, the Family and Gender
MHA : Ministry of Water Management and Sanitation
MSA : Ministry of Health and Social Action
NGO : Non-Governmental Organization
PCGES : Environmental and Social Management Framework Plan
PNDL : Local National Development Programme
PPC : Community Roads Project
PPDC : Casamance Development Pole Project
PRACAS : Senegalese Agriculture Acceleration Programme
PSE : Emerging Senegal Plan
PUDC : Emergency Community Development Programme
PUMA : Emergency Border Highways and Territory Modernization Programme
SF : Saudi Fund
TFP : Technical and Financial Partner
UA : Unit of Account
WFP : World Food Programme

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PROJECT INFORMATION SHEET
COUNTRY : Republic of Senegal
BORROWER : Republic of Senegal

EXECUTING AGENCY : National Directorate of the Emergency Community Development
Programme (PUDC)

PROJECT NAME : Emergency Community Development Programme Support
Project (PA – PUDC)

PROJECT AREA : Ziguinchor, Kolda, Sédhiou, Kaolack, Louga, Thiès, Diourbel,
Fatick, Kaffrine, Tambacounda, Kédougou and Matam regions

1. Financing Plan

Source Amount (EUR Million) Instrument
AfDB 60.00 AfDB loan to the Republic of Senegal

IsDB 55.5 Loan to the Republic of Senegal
Saudi Fund 37.5 Loan to the Republic of Senegal
Government 9.03 Counterpart Contributions
TOTAL COST 162.03

2. Key AfDB Financial Information

Loan currency Euros (EUR)
Loan type Fully flexible loan
Maturity 20 years
Grace period 5 years
Weighted average maturity**: 12.75 years
Repayments Semi-annual payments at the end of the grace period
Interest rate Base rate + Financing cost margin +Loan margin + Maturity premium. This interest
rate must be greater than or equal to zero.
Base rate Floating (EURIBOR 6 Months revised every 1 February and 1 August or any other
acceptable rate). A free option is available to set the base rate
Financing cost margin Bank's funding cost margin revised every 1 January and 1 July and applied every 1
February and 1 August with the base rate
Loan margin 80 base points (0.8%)
Maturity premium - 0.00% for a weighted average maturity of 12.75 years
Opening fee 0.25% of the loan amount payable no later than the date of signature of the loan
agreement
Commitment fee 0.25% per year of the undisbursed amount. It begins 60 days after the date of signature
of the loan agreement and is payable on the interest payment dates.
Base rate conversion option * In addition to the free option of determining the base rate, the Borrower is offered the
option of returning to the floating rate or adjusting all or part of the disbursed amount
of its loan. Transaction fees are payable.
Ceiling or rate tunnel option * The Borrower is offered the possibility of putting a ceiling or tunnel on the base rate
for all or part of the disbursed amount of its loan. Transaction fees are payable.
Loan currency conversion option * The Borrower is offered the possibility of changing the currency of all or part of its
loan, disbursed or not, into another lending currency of the Bank.
Transaction fees are payable.

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Economic Analysis EIRR : 27%; NPV @10%: EUR 49.18 million

Financial Analysis FIRR: 11% ; NPV @ 2 % : EUR 86.77 million

3. Timeframe – Main Milestones (projected)

Stages Periods

Concept Note Approval June 2018
Project Approval September 2018
Effectiveness December 2018
Completion September 2022
Last Disbursement December 2022
Last repayment December 2048

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Project Summary
1. Overview: Drawing lessons from the implementation of two generations of Poverty
Reduction Strategy Papers (PRSPs, PNEDS and SNEDS), the Government of Senegal in 2014
developed a new development model known as Emerging Senegal Plan (PSE). In this new strategy,
emphasis is laid on improving people's living conditions and combating social inequalities.
Furthermore, in order to achieve the PSE objectives, the Government in 2015 developed the
Emergency Community Development Programme (PUDC), which seeks to help improve access to
basic social services for the rural population by building socio-economic infrastructure and
promoting the involvement of local actors in the economic and social development of their areas.
Phase 1 of the programme, to which the Bank contributed with a budget support operation, was
finalized at end December 2017 (the outcomes of Phase 1 are given in Annex A.2.1 of the Technical
Annexes). This project is the Bank's support for the first operation of PUDC Phase 2, which will
be financed along with other donors. It will improve people's living conditions with substantial
support for the development of agricultural value chains and easier access to basic socio-economic
road and energy infrastructure. The project has been coherently designed, drawing lessons from
achievements of Phase 1 of the programme and taking into account interventions planned by other
donors (details of consistency of the operation are given in Annex A.2.1 of the Technical Annexes).
2. The first Phase 2 operation will be implemented over a period of four (4) years. Its total
cost is estimated at EUR 162.03 million. The Bank's contribution, as parallel financing, is estimated
at EUR 60 million, excluding taxes and customs duties. The operation is co-financed with the
Islamic Development Bank (IsDB), the Saudi Fund (SF), and the Government of Senegal.
3. The main expected outcomes of the first operation of Phase 2 include: (i) support for the
establishment of 109 Rural Agricultural Societies (SAR) and 109 farming areas, including
irrigation equipment (5-10 hectares); (ii) the construction of 105 boreholes and drinking water
supply infrastructure ; (iii) the procurement of 799 processing machines for women and young
people; (v) the construction of 710 km of rural roads and 76 solar power stations; (vi) the
installation of 1,023 km of Medium and Low Voltage networks and 190 H61 sub-stations; (vii) the
construction of 70 equipped health posts. The AfDB will finance part of the proposed activities. Its
approach is based on : (i) sustained support for agricultural value chains (tomato, pepper, sweet
potato, onion, etc.) to improve the development of commercial agriculture and help increase
incomes in rural areas; and (ii) the construction of transport and energy infrastructure (rural roads
and rural electrification) and basic socio-economic infrastructure and facilities (water, sanitation
and health) to improve the people's living conditions. The intervention will also lay emphasis on
strengthening community development mechanisms by targeting the involvement of all
stakeholders in the project implementation.
4. The project area will cover several localities in Ziguinchor, Kolda and Sédhiou, Kaolack,
Diourbel, Fatick, Thiès and Kaffrine Tambacounda, Kédougou and Matam regions, and will affect
3 million people. The direct beneficiaries of the project are estimated at 1.5 million people who
live in the project area, as well as people polarized by the localities. The project will help: (i)
increase incomes in rural areas; and (ii) improve people's access to basic social services. As regards
impacts, the development of agricultural activities will help reduce the poverty rate from 67% to
54%, the child mortality rate from 51 to 25%, and the chronic malnutrition rate from 21% to 8%.

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5. Needs Assessment: In Senegal, rural areas have the majority of the population (57%),
who are mainly engaged in agro-pastoral activities. The current trend is for young people to leave
the rural areas and go to the cities in search of jobs, and sometimes even go on illegal emigration.
The country's cereal deficit is huge, and many rural households are vulnerable, with recurrent
rainfall deficits and acute malnutrition rates exceeding the emergency threshold (10%). In addition,
the rural population has poor access to infrastructure (water, health, electrification, transport,
economic services) with large regional disparities. The 187 most isolated rural municipalities are
scattered in 11 of the country's 14 regions. Consequently, access to markets is still limited, and
input and transport costs for agricultural products are still high, with significant post-harvest losses.
In these localities, there are strong regional disparities.

6. Value Added for the Bank: The project design took into account the project document
prepared by the Government for Phase 2, various similar operations of the Bank and other partners in the
country, as well as those provided in the Bank's 2018 lending programme. Given that the PUDC is basically
a multi-sector and cross-cutting programme, the added value for the Bank lies mainly in its intervention
approach based mainly on substantial support for the implementation of value chain activities and provision
of basic infrastructure, equipment and socio-economic services. This operation will therefore complement
those already implemented, ongoing or scheduled under other projects financed by the Bank in areas as
diverse as water and sanitation, rural electrification, rural roads, health and nutrition. In addition, the Bank
will finance technical studies in different sectors, an IEC programme for behaviour change, and capacity
building programmes for stakeholders. Finally, the Bank will be involved in the operation of the Project
Management Unit (PMU), which is in charge of carrying out and monitoring activities.
7. Knowledge Management: The project monitoring and evaluation system will be
common to the other donors involved in the programme, and will generate relevant information on
its impact. It will also be used in monitoring and evaluating the various sectors covered by the
programme. Information from this operation will be discussed and used to fine tune and better plan
the country's development policies and strategies.

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RESULTS-BASED LOGICAL FRAMEWORK
REPUBLIC OF SENEGAL: Emergency Community Development Programme Support Project (PA-PUDC)
Project Goal: Help to develop activities in rural areas and improve people’s access to socio-economic infrastructure
PERFORMANCE INDICATORS
MEANS OF VERIFICATION RISKS/
Indicator Baseline Situation Target
RESULTS CHAIN MITIGATION MEASURES
(2017)
Sustainably improve the socio-economic and health conditions (2030) ANSD Reports
CT of people in rural areas 1. Poverty rate in rural areas 67% 54 % PUDC final evaluation reports/
MPA 23.. CInhfaronnt iacn md aclhniuldtr mitioornt arlaittye rate 5211‰% 285%‰ EDS Report
I CLM Reports

Effect 1: Improved access to basic socio-economic 1.1. Number of additional people, including (In 2025) Risks

infrastructure for people in rural areas and in the programme vulnerable groups, with access to health 0 300 000 with 51% women - Failure to assign health staff to new health
area. infrastructure as a result of the project posts.

1.2. Number of additional people, including
vulnerable groups, with access to safe drinking Sources: M itigation Measures
water and sanitation infrastructure as a result of 800 000 with 51% women Reports of the Ministry of - The Senegalese Government has
the project 0 Health, Reports of the Ministry undertaken to assign the required staff and
of Water Resources include the salaries in the annual budgets
concerned.
PEPAM Annual Reports,
Reports of the Ministry of Risks
Energy - Delays in procurement
Effect 2 : Improved access to road and energy infrastructure 2.1. Number of additional people with access to (In 2025)
SECT f or people in the programme area 2.2. eNleucmtrbiceirt yo fa vs iall aregseusl to opfe ntheed purpo jbeyc tt;h e project 0 3 00 000 with 51% women AAAGNSEDERRS O ARUnenpTuoEar tlAs R. n enpuoarlt sR eports -M- iPt ioDgoaurt rpiionenrgf oPrmhaasnec e1 oof fl otchael bpurosignreasmsems e, the
EFF 0 800 PUDC Management Unit prepared a list of
successful businesses, and will take this into
account during the procurement process.

Effect 3: Improved access to markets and increased incomes 3.1. (In 2025) Sources: Reports of the Ministry
for producers in the programme area. of Energy and Ministry of
3.2. % of the population with access to markets 27.6 50 Transport. ASER, AGEROURE
within one hour Reports, ANSD Annual Reports
3.3. Annual household incomes in rural areas CFAF 684 008 CFAF 730 000

3.4. Number of jobs created or consolidated by the 0 6 000 indirect/ 30 000 direct
programme
jobs, with 30% for women

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Output 1 : Road and energy infrastructure (In 2025) Sources: Quarterly project
A1. Rural roads 1. Km of roads 0 300 progress reports and Bank Mitigation
A2. Rural electrification 2. Number of solar plants 0 30 supervisio n reports
3. Km of MV/LV lines 0 300/300 Sources: Annual reports of the The PUDC Management Unit team acquired
Ministry in charge of PUDC
Output 2 : Water supply, health and education facilities solid experience in procurement during Phase
monitoring.
B.1. Health stations equipped 0 20 1. It will also receive training in AfDB
Reports of sector Ministries
B.2. Boreholes with water towers 1. Number of health posts built 0 40 procurement rules and procedures at project
concerned with the programme
B.3. Drinking water supply systems 2. Number of new boreholes constructed and 0 500 start-up.
Sources: ANSD reports
equipped
3. Km of water systems provided

Output 3. Market Gardening Areas and Agricultural Sources: Project activity and Risks
Equipment Bank supervision reports - Delays in procurement and poor performance
C.1. Farming areas developed 1. Number of farming areas developed 0 40 of businesses
TS C.2. Rural agricultural societies (SAR) 2. Number of SARs created and supported 0 40 - Failure by beneficiaries to assume ownership
PU C.3. Procurement of harvesting machines / SAR 3. Number of machines procured 0 100 Sources: ANSD Reports
UT C.4. Procurement of post-harvest machines 4. Number of post-harvest machines procured 0 500 Mitigation
O - The PUDC Management Unit team will
Output 4 : Studies and capacity building Sources: Project activity and receive training in AfDB procurement
D.1. Development of IEC/CCC 1. Number of people sensitized 0 1 500 000 with 50% women Bank supervision reports procedures at project start-up. In addition, the
D.2. Preparation of business plans for promoters 2. Number of business plans prepared 0 100 project will use AAA option for certain
D.3. Training of Sector Ministry staff 3. Number of Ministry staff trained 0 50 with 30% women procurements.
D.4 Training of Women/Young People’s Groups 4. Number of women and young people trained 0 CFAF 250/day - The various local administrations working in
D.5 Training of local authorities’ workers 5. Number of workers trained 0 2 000 with 30% women community development (sub-prefectures,
D.6. Capacity building for mutual health insurance companies 6. Number of mutual health insurance companies 0 100 ARD, NGOs, etc.) will be involved in the
D.7 Nutritional surveillance (NS) supported 0 3 000 process to ensure proper ownership of the
D.8 Treatment of cases at community level 7. Number of children under NS 0 At least 80% programme by the population.
8. Number of malnourished children under treatment

COMPONENTS OF AFDB’S INTEREVENTION RESOURCES OF THE FIRST OPERATION OF PUDC, PHASE 2

S Components Amounts – EUR Million Donors Amounts – EUR Million
E
VITI A. Value Chains and Infrastructure Development 64.50 AfDB 60.00
TI B. IEC, Studies and Capacity Building 2.31 IsDB 55.50
AC C. Project Management 2.22 Saudi Fund 37.5
Y Total 69.03 Government of Senegal 9.03
KE Total 162.03

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