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Implementation Completion Report (ICR) Review - Kh-northeast Village

1. Project Data:   
ICR Review Date Posted:
Project Name:
Kh-northeast Village
Project Costs(US $M)
 6.3  5.4
Loan/Credit (US $M)
 5.0  4.7
Sector, Major Sect.:
Irrigation and drainage, Central government administration, Sub-national government administration, Roads and highways, Water supply,
Agriculture fishing and forestry; Law and justice and public administration; Law and justice and public administration; Transportation; Water sanitation and flood protection
Cofinancing (US $M)
 0.7  0.5
L/C Number:
Board Approval (FY)
Partners involved
Japan PHRD Grant 
Closing Date
04/30/2002 06/30/2004
Evaluator: Panel Reviewer: Group Manager: Group:  
Kavita Mathur
Nalini B. Kumar Alain A. Barbu OEDSG

2. Project Objectives and Components:

a. Objectives
The objectives of the Northeast Village Development Project (NVDP) as stated in the appraisal document were:

"to introduce decentralized, participatory poverty-focused rural development approaches in some of the poorest areas of Cambodia; and to gain the experience in managing such programs needed by the Government of Cambodia for formulating and carrying out a cohesive national strategy for rural development in the post-2001 period."
The objectives of the project were not revised.

b. Components (or Key Conditions in the case of Adjustment Loans):
The project comprised of two components:
A. Participatory Planning and Investment Component(appraisal cost US$4.3 million, actual cost US$3.6 million). The component was to support development of a participatory planning system, starting at the village level with the formation of Village Development Committees (VDC) and progressively reach different levels of local government [referred to as Local Development Process (LDP)]. The project was to finance activities to carry out participatory rural appraisals (PRA) in 120 villages in 27 target communes.
B. Institutional Strengthening and Project Management Component(appraisal and actual cost US$1.8 million). The component was to develop and strengthen the management and development planning, implementation and monitoring skills of the Ministry of Rural Development (MRD), NVDP staff, Provincial Department of Rural Development (PDRD) counterparts and VDC members as well as create capacity for future community development activities outside the scope of NVDP.
Revised components: Following changes were made to the participatory planning and investment component: (a) project area was expanded to include two additional provinces - Battambang and Banteay Meanchey; (b) sub-project menu was simplified; and (c) sub-projects were limited to one in each village.

c. Comments on Project Cost, Financing, Borrower Contribution, and Dates
The project was extended for over two years. The original design underestimated the security limitations and logistical difficulties of implementing a decentralized project in remote provinces in Northeast Cambodia. The significant constraints of the rainy season flooding on the construction of subprojects was also not factored adequately into the original project implementation schedule.
Adjustments in expenditure category allocations were made to accommodate the inclusion of two new provinces in the Northwest as well as to compensate for the extension of 26 months. Government counterpart funds were available on time. Community cash contributions were collected as anticipated but with some difficulty.

3. Relevance of Objectives & Design:

The development objective was consistent with the priorities of the 1999 Country Assistance Strategy (CAS) in place at project appraisal, which included enhancing rural development and natural resource management, improving human resources, reducing poverty and strengthening institutional capacity. It was also consistent with the Royal Government of Cambodia's (RGC's) first Five-Year Socioeconomic Development Plan (SEDP 1996-2000) which committed the government to decentralized rural development using a participatory and bottom-up approach. However the new laws governing the formation and role of Community Councils (CC) and the process for the election of CCs in 2002 affected the institutional structures in which the project operated and indirectly had an adverse impact on project outcome.

The project was designed as a Learning and Innovation Loan (LIL) to help develop and test organizational arrangements, planning and implementation processes and capacity building programs, focused on enabling local institutions to identify, plan, implement, monitor and manage local development activities, with the intention to extend the application of these, once proven effective, under a larger-scale follow-on project.

4. Achievement of Objectives (Efficacy) :

The objective to introduce decentralized, participatory poverty-focused rural development approaches was substantially achieved.The ICR notes that the NVDP village targeting process was satisfactory. VDCs were elected in 120 targeted villages, village level PRAs were completed, Village Action Plans were formulated according to the priorities of the villagers. Training was provided to each community and its VDC. Operation and Maintenance Committees were organized in participating villages. However though VDCs were trained, they used their new skills only once during the project cycle with consequent implications for project sustainability (see section 8 of the ICR Review below).
The objective to gain experience in managing such programs needed by the RGC was also substantially achieved.Technical Guidelines on sub-project implementation and Operations and Maintenance were developed, tested and revised during project implementation. The lessons learned were disseminated through National and provincial level workshops.

5. Efficiency:

It is difficult to make a judgement on efficiency as no economic analysis of the project was carried out during appraisal or completion. Also, no impact assessment was done. However, the ICR notes substantial benefits from the project to village communities. For example, the rehabilitation of rural transportation infrastructure has resulted in savings in vehicle operating costs, travel time and travel costs, thereby increasing access to employment (higher wages and earnings) and business opportunities (higher prices for crops and increased total revenues). The rehabilitation and construction of communal irrigation schemes has increased yields, irrigated area and cropping intensity. It is worth noting that the ICR also reports on the high costs of participation to village communes. It is not clear how far the Bank systematically and realistically assessed the costs and benefits of participation in undertaking the project.
6. M&E Design, Implementation, & Utilization:

At appraisal, it was decided that M&E framework and baseline would be developed at implementation. NVDP M&E system consisted of a Monitoring and Reporting System for all villages. Values for performance indicators were determined through a participatory process. LDP process was adequately monitored and lessons learned were documented in NVDP Lessons Learned document. However, as the ICR itself notes "it would have been useful also to have more M&E indicators on the local development process." (page 11)
7. Other (Safeguards, Fiduciary, Unintended Impacts--Positive & Negative):

The project did not allow for involuntary resettlement. However, voluntary contributions of small amount of land and other assets were allowed.The ICR notes that the compliance with the Bank's policy on involuntary resettlement was satisfactory. To avoid the need for involuntary resettlement, no new roads or irrigation schemes were financed under the project. Also, compliance with Indigenous Peoples policy was also satisfactory.

8. Ratings:
OED Review
Reason for Disagreement/Comments
Institutional Dev.: 
LikelyUnlikelyThe overall sustainability is rated unlikely for the following reasons:
  • Broader sustainability is diminished because there has been no follow-up to the LIL. As the ICR itself notes "NVDP was not originally expected to provide free-standing sustainability of outcomes in its own right." (page 15); and
  • Although VDCs were trained, there are concerns about the sustainability of the participatory approaches. The ICR itself notes that "Since they had not used some of these acquired skills, VDC members could not all clearly explain the skills they had learned in an interval of up to three years earlier, indicating that the capacity would not likely remain if not used further."
Bank Perf.: 
SatisfactorySatisfactoryHowever during preparation, inadequate attention was given to some design aspects such as decentralized fund flow arrangements, drafting of initial Project Operations Manual and development of monitoring and evaluation framework and baseline data.
Borrower Perf.: 
SatisfactorySatisfactoryHowever the new laws governing the formation and role of CC and the process for the election of CCs in 2002 affected the institutional structures in which the project operated.
Quality of ICR: 

- When insufficient information is provided by the Bank for OED to arrive at a clear rating, OED will downgrade the relevant ratings as warranted beginning July 1, 2006.
- ICR rating values flagged with ' * ' don't comply with OP/BP 13.55, but are listed for completeness.

9. Lessons:

Based on the ICR, the following lessons are noted :
  1. The building of adequate community participation requires time and resources. Setting up grass root organizations is just the first step. More time and resources are needed to strengthen and consolidate gains so that their sustainability over the long run is assured.
  2. The Bank should systematically and realistically assess the costs and benefits of undertaking participatory projects. The expereince of the NVDP project shows that there are several key constraints to sustained participation which do not appear to have been taken into account. These include: (a) the high opportunity cost of participation; (b) the low likelihood of significant return on participation in the form of further investment in the village; and (c) literacy and low base-level capacity.
  3. Project experience shows that there are substantial variations in capacity between VDCs of different villages. Poorer and more isolated villagers lacked basic skills and capabilities among VDC members. Therefore, VDC formulation and training in poorer and/or isolated villages requires more intensive facilitation to achieve results.
  4. Local contribution (in form of cash or material/labor) also varied by villages. Therefore, project design should allow for greater flexibility by varying amounts required according to individual households ability to pay, allowing for substitution of labor for cash contribution and including incentives for contributing cash, such as a matching fund formula rather than a fixed percentage of a predetermined amount or project size.

10. Assessment Recommended?  Yes

          Why?  For two reasons: (i) verify project ratings, and (ii) to assess the soundness and sustainability of the participatory approaches developed at the community level.

11. Comments on Quality of ICR:

The quality of the ICR is satisfactory. It provides good information on the project experience and identifies important lessons.

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