Liberia Rural Economic Transformation Project Additional Financing

active

The Government of Liberia, in a letter dated May 12, 2021, requested the World Bank to process Additional Financing to the Rural Economic Transformation Project (P175263) in support of a Fast Track Programme for Food and Nutrition Security. The Additional Financing (AF) would be used to consolidate and expand project activities showing strong results to secure a higher level of impact on the Project’s development objectives. The results framework will be updated at project appraisal to capture the additional outputs and outcomes envisaged to be generated during the AF period. The AF will scale up activities to boost farm production, market access, and crisis response in components 1 and 2, and enhance project coordination and management capacity in component 4. A new Component 5 will be added to improve food availability and support community agricultural investments. All scaled-up and new activities will build directly on relevant methods and structures put in place under the parent project. Implementation arrangements, responsible agencies, and partner institutions from the parent project will be retained in full, including the Project Implementation Unit (PIU) within the Ministry of Agriculture.Food insecurity is surging in Liberia. The current WFP hunger map indicates that 1.7 million Liberians (about 37 percent of the population) have insufficient food consumption. Additionally, 4.3 percent of children under five face acute malnutrition while 30.1 percent of these under-five children face chronic malnutrition. Admissions for moderate acute malnutrition in children and nursing women increased by over 10 percent between December 2021 and January 2022 and admissions for severe acute malnutrition in children and nursing women increased by over 3 percent between December 2021 and January 2022 and were 13 percent higher than the January 2021 level. In response to the crisis, a Technical Assessment of the described food insecurity crisis was undertaken to demonstrate eligibility for the Crisis Response Window – Early Response Financing (CRW-ERF). The CRW-ERF Technical Expert Group on Food Security (TEGFS) confirmed that the food security trends, conditions, and projections qualify Sierra Leone for local-based activation for CRW ERF resources. In response to the food and nutrition crisis in the country, the Government of Liberia (GoL) has worked with partners (including the World Bank, UN agencies, and donors) to develop a US$120 million Quick Action Food Security Response Plan (QA-FSRP) that provides a framework for interventions to protect the 1.68 million most vulnerable people. The QA-FSRP focuses on short-term measures that protect the most vulnerable from food shortages and negative food security and nutrition impacts of price spikes while also seeking to create a roadmap for medium to long-term investment to boost agriculture productivity. Specifically, the objectives of the plan are to (i) improve short-term food availability and access (especially for rice) through facilitating the import and distribution of food, efficient management of food reserves, avoidance of policy interventions in food markets, and protecting the purchasing power of poor households; (ii) prepare for and support future rice harvests through agricultural input acquisition and distribution, expanded mechanization, financial, and advisory services for farmers and agricultural small and medium enterprises (SMEs), conditional cash transfers to youth for increased local food production in prioritized areas; and (iii) improve crisis monitoring, evaluation, coordination, and management; and putting in place contingency plans to deal with the impacts of acute shocks.The proposed AF responds to the Government’s request to support the QA-FSRP. The AF will contribute to filling the financing gap, with World bank funds supporting two QA-FSRP objectives: (i) preparing and supporting future harvests, focusing on rice; and (ii) improving crisis monitoring, evaluation, coordination, and management. Aligned with the above, the AF would fund t he following specific additional activities:1. Component 1: Improving the Enabling Environment for Agribusiness Development (original project US$6 million – with restructuring US$3 million): The proposal is to scale down project activities under this component in support of the capacity building of public agribusiness services, value chain coordination, and support to agricultural research and development, and extension. While still relevant to the overall objective of the project, these activities to be scaled down are now being pursued and funded through the ongoing Bank-financed Smallholder Agriculture Transformation and Agribusiness Revitalization Project (STAR-P, P160945) with which coordination will be strengthened to ensure synergy and complementarity. A total of US$3 million earlier committed to these activities under the parent project will now be deployed to productive activities (US$1.5 million) under Component 2 and Project Coordination and Management (US$1.5 million) to finance needed expertise to support the strengthening of early warning systems and food security crisis preparedness planning; and technical assistance (TA) for project coordination, monitoring, and evaluation. 2. Component 2: Enhancing Competitiveness and Market Access through Productive Alliances (original project US$12.5 million; with restructuring US$14 million): Resource allocation to Component 2 has been increased by US$1.5 million. This financing will go towards scaling up pre-investment activities that are designed to support the development of proposals for investment subprojects (i.e., towards services of the Fund Manager), and towards the provision of matching grants to smallholders. As in the parent project, all pre-investment activities will emphasize a better understanding of climate change risks and available adaptation and mitigation options including (i) the use of climate-resilient seed varieties; (ii) investments in climate-resilient infrastructure and the adoption of practices that will prevent soil erosion and retain soil nutrients; (iii) improved water management; and (iv) efficient methods and technologies to manage pests and diseases (see Annex 3 for planned climate change adaptation and mitigation measure planned under the AF). 3. Component 3: Agri-Marketing and Road Infrastructure Investments (original project US$31.5 million): No change is proposed to this component. 4. Component 4: Project Coordination and Management and Contingency Emergency Response (original project US$5 million; with restructuring US$6.5 million): An additional US$1.5 million is proposed for Project Management and Coordination to enhance the technical and organizational capacity of implementing agencies. This will include: (i) strengthening the PIU staffing with the competitive recruitment of a food security specialist to support the strengthening of early warning systems and food security crisis preparedness planning; (ii) the development of a food security crisis preparedness plan after the effectiveness of the project; and (iii) TA for specific activities including preparation of several documents (environmental and social instruments, etc.); monitoring and evaluation (M&E) surveys and studies (baseline, mid-term review, completion report, and impact evaluation); citizen engagement, management of a Grievances Redress Mechanism (GRM), including non-governmental organizations (NGOs) specialized in the prevention and management of SEA/SH risks; a Third-Party Monitoring Agency (TPMA) which will be contracted to monitor project activities. 5. Component 5 (New): Support to Food Security (AF US$30). The proposed AF will introduce a new component, to stimulate a food supply response by deploying emergency production support to affected communities, while also addressing the underlying vulnerability to mitigate any such future shocks to food security. It will finan