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Implementation Completion Report (ICR) Review - Bosnia Forestry Project

1. Project Data:   
ES Date Posted:
Project Name:
Bosnia Forestry Project
Project Costs(US $M)
 20.2  17.8
Loan/Credit (US $M)
 7.0  6.7
Sector, Major Sect.:
Forestry, Central government administration,
Agriculture fishing and forestry; Law and justice and public administration
Cofinancing (US $M)
 13.2  11.2
L/C Number:
Board Approval (FY)
Partners involved
EU, Italy, Norway 
Closing Date
12/31/2000 03/31/2003
Prepared by: Reviewed by: Group Manager: Group:  
John English
Soniya Carvalho Alain A. Barbu OEDST

2. Project Objectives and Components:

a. Objectives
To resume sustainable management of forest resources in Bosnia and Herzegovina (BiH), in order to:

  • ensure the sustainability of the rapid recovery of the wood harvesting and wood processing sectors; and
  • control the potential environmental impact of this recovery.

b. Components
The project was carried out in both the Federation of Bosnia and Herzegovina (FBiH) and the Republika Srpska (RS). It had four components: Support to Forest Management (US$3.3 million- 16.3 percent of project cost). This comprised: (i) support to policy changes, through studies on the institutional, and fiscal and marketing aspects of the forestry sector in FBiH and RS; (ii) forest management planning; (iii) support to resume and secure adequate enforcement of forestry legislation; and (iv) support to the forest inspection service.
Protection and Rehabilitation of Forests (US$3.6 million - 17.8 percent of project cost) This comprised: (i) protection of about 150,000 ha of forests from insect attack; (ii) reforestation of about 500 ha of forests heavily damaged during the war; and (iii) preliminary measures to strengthen the protected areas in BiH.
Rehabilitation of State Forest Enterprise's (SFE's) Operational Capacity (US$ 12.7 million - 62.8 percent of project cost). This aimed to restore the operational capacity of selected SFEs in both FBiH and RS. The component funded (i) equipment to repair and maintain existing roads damaged during the war; and (ii) other forestry equipment to enable normal operations of the SFEs to resume.
Project Management and Monitoring (US$0.6 million - 2.9 percent of project cost). The component funded: (i) incremental staff needed to implement procurement, disbursement, auditing and reporting procedures required under the project; and (ii) technical assistance to undertake studies and set up a monitoring and evaluation system, including monitoring of the environmental impact of the project.

c. Comments on Project Cost, Financing and Dates
The Bank support was drawn from the BiH Interim Trust Fund and was used to support the third component, rehabilitation of SFEs. The initial project timetable (envisaging completion, in 2 1/2 years, by end 2000) was, perhaps, unrealistic. The TA team was not operational until almost a year after effectiveness and the closing date was eventually postponed by 27 months. Final costs were US$17.8 million compared to the estimate of US$20.2 million and Bank financing was US$6.7 million. US$0.3 million of the credit was canceled.

3. Achievement of Relevant Objectives:

Overall, the outcome of the project objectives was satisfactory. It introduced policy changes in forest management, helped resume sustainable forest management planning and harvesting to provide inputs for the wood industry, reduced damaging insect infestation, and provided road maintenance and forestry equipment to enable harvesting and transportation of timber to be carried out in ways that reduce environmental damage.

4. Significant Outcomes/Impacts:

Forest management. The forest inventory and management unit in Sarajevo was re-established and equipped, and (with TA) inventory and management planning methods were enhanced. The Forest Inspection Service was similarly enhanced with provision of vehicles and equipment and training in order to bring new staff up to speed.
Forest protection. The project helped protect about 150,000 has. of forests from insect attack, reforest about 500 has of heavily damaged forests, provide vehicles, equipment, rehabilitate facilities in the main national park in RS and fund preliminary studies for establishment and management of a number of environmentally sensitive areas.
Rehabilitation of SFEs. The rehabilitation of about 300 km of forest roads and 64 culverts, together with construction of about 215 new culverts and 8 bridges was instrumental in improving access to forests. This support, as well as the funding of improved harvesting and logging equipment, allowed access to mature areas and, thus, enabled rational logging and maintenance programs to be reestablished, as well as the use of environmentally satisfactory harvesting techniques.

5. Significant Shortcomings (include non-compliance with safeguard features):

The major shortcoming was that the development of the monitoring and evaluation system lagged and was not in place by completion. This limited the ability of the forest service to monitor production and environmental impact.
  • At the time of project completion, the reforms intended to proceed in parallel with the project, had only started to materialize.

A Forest Development and Conservation Project (FDCP) was approved in June, 2003 and was effective in October, 2003. This was designed to tackle these shortcomings and will (i) assist the government to implement the institutional reforms and improve the transparency of financial flows in the sector; (ii) improve forest management information systems to upgrade monitoring, etc., and; (iii) develop a comprehensive statewide approach to biodiversity conservation.

6. Ratings:ICROED ReviewReason for Disagreement/Comments
SatisfactoryModerately Satisfactory[the ICR's 4-point scale does not currently provide for a "moderately sat." rating]. The M & E system was too weak to ensure satisfactory achievement of the project objective of controlling potential environmental impacts.
Institutional Dev.:
LikelyNon-evaluableRecent measures and the follow-on project could contribute positively to sustainability of the achievements of the project, but the present situation is unclear.
Bank Performance:
Borrower Perf.:
Quality of ICR:

7. Lessons of Broad Applicablity:

The ICR notes three broad lessons:
(a) In a divided country an emphasis on technical investments can achieve quick results on the ground and help build broader-based trust and collaboration between stakeholders;
(b) projects seeking to achieve institutional reform benefit from a mixture of credit and grant funding; and
(c) support for a participatory approach to institutional reform is more likely to be successful than a purely technical approach.

In addition the outcome of the project suggests that a strong M & E system is critical for monitoring and controlling environmental impacts.

8. Audit Recommended?  Yes

          Why?  To verify the ratings

9. Comments on Quality of ICR:

The ICR provides a good discussion of the project's objectives and achievements. The discussion of Bank performance is noteworthy for its coverage of implementation and supervision issues, but discussion of the performance of the SFEs is thin.

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