Grant Assistance Report
Project Number: 40037 November 2007
Proposed Grant Assistance Papua New Guinea: Lae Port Livelihood and Social Improvement Project (Financed by the Japan Fund for Poverty Reduction)
CURRENCY EQUIVALENTS (as of 31 October 2007 )
Currency Unit – kina (K) K1.00 = $0.357 $1.00 = K2.797
ABBREVIATIONS
ADB – Asian Development Bank IPBC Independent Public Business Corporation JFPR – Japan Fund for Poverty Reduction NGO – nongovernment organization MPA – Morobe Provincial Administration MPG – Morobe Provincial Government PMU – project management unit PNG – Papua New Guinea PPCL – PNG Ports Corporation Limited SOE – statement of expenditures
NOTES
(i) The fiscal year (FY) of the Government of Papua New Guinea ends on 31 December. FY before a calendar year denotes the year in which the fiscal year ends, e.g., FY2007 ends on 31 December 2007.
(ii) In this report, “$” refers to US dollars.
Vice President C. Lawrence Greenwood, Jr., Operations Group 2 Director General P. Erquiaga, Pacific Department (PARD) Director I. Bhushan, Pacific Operations Division, PARD
Team leader L. Cai, Infrastructure Specialist, PARD Team members K. Schmidt-Soltau, Social Development Specialist (Safeguards),
Regional and Sustainable Development Department
International Dateline
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PAPUA NEW GUINEA
LAE PORT LIVELIHOOD AND
SOCIAL IMPROVEMENT PROJECT
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JAPAN FUND FOR POVERTY REDUCTION (JFPR) CITY OPapua NJFPR Grant Proposal
I. Basic DataName of Proposed Activity Lae Port Livelihood and Social Improvement
Project
Country Papua New Guinea
Grant Amount Requested $1.5 million
Project Duration 3 years
Regional Grant Yes / No
Grant Type Project / Capacity building
II. Grant Development Objective(s) and Expected Key Performance Indicators
Grant Development Objectives:
The key objective of the JFPR Project is to extend the benefits of the Asian Development Bank’s (ADB) Lae Port Development Project to some of the poorest communities in Lae in Papua New Guinea, and to strengthen the port Project’s impact on poverty reduction. The JFPR Project will provide: (i) enhanced social infrastructure and services to people resettled from a swamp and other poor communities, (ii) income-generating opportunities to three Labu villages that live on subsistence agricultural and fishery, (iii) livelihood enhancement training for women and men, and (iv) independent monitoring by a nongovernment organization (NGO). Expected Key Performance Indicators :
(i) Three schools and one health clinic expanded; (ii) Microcredit provided to up to 200 families; (iii) Training provided for 700 women and 150 men in health and vocational skills; (iv) Training and assistance given for home food processing, agricultural demonstration
plots with marketing support for the raising of chickens, pigs and rabbits and the cultivation of vegetables, and assistance and demonstration trials provided for floating fish cages in lagoons for the Labu villages; and
(v) Independent monitoring reports produced.
III. Grant Categories of Expenditure, Amounts, and Percentage of Expenditures
Category Amount of Grant Allocated in $
Percentage of Expenditures
1. Civil works 695,218 46
2. Goods 69,450 5
3. Consulting services 400,290 27
4. Training 152,071 10
5. Contingency 182,971 12
Total 1,500,000 100
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JAPAN FUND FOR POVERTY REDUCTION
JFPR Grant Proposal Background Information
A. Other Data
Date of Submission of Application
1 June 2007
Project Officer Cai Li, Infrastructure Specialist Project Officer’s Division, E-mail, Phone
PAHQ, [email protected], 632-5254
Other Staff Who Will Need Access to Edit/Review the Report
Cecile Bantugon, Neille-Ann Aurora Villanueva, Elizabeth Li
Sector Education; health, nutrition, and social protection; agriculture and natural resources
Subsector Basic education, health programs, fishery Themes Inclusive social development, gender and development Subthemes Human development, gender equity in opportunities Targeting Classification Targeted intervention (non-income MDGs [TI-M]) Was JFPR seed money used to prepare this grant proposal?
Yes [ X ] No [ ]
Have SRC comments been reflected in the proposal?
Yes [ X ] No [ ]
Name of Associated ADB Financed Operation(s)
Lae Port Development Project
Executing Agency Morobe Provincial Administration Grant Implementing Agency Morobe Provincial Administration
Mr. Patilius Gamato Phone: (675) 473 1822 [email protected]
B. Details of the Proposed Grant
1. Description of the Components, Monitorable Deliverables/Outcomes, and Implementation Timetable
Component A Component Name Improving Social Infrastructure and Services for the Poor
CommunitiesCost ($) 649,048Component Description A1. Expanding School and Health Facilities
Education and health are basic social services, and are important for poverty reduction. The relocation of 482 households with a population of 2,912 to Malahang as part of the Lae Port Development Project will stretch existing school and health facilities in that area. The component will expand
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the Bowali elementary and primary schools, Malahang Technical School, and Malahang clinic to accommodate 473 more pupils and additional demand for health services.
A2. Providing Community Infrastructure for All
Urban populations in the resettlement area do not have community infrastructure. This component will build a sports area and a community center, and will provide a roof, and water and electrical service to improve an existing market.
Monitorable Deliverables/ Outputs
A1. Expanding School and Health Facilities for Children’s Education
1. Four hundred seventy-three additional children enrolled in the schools.
2. Six class rooms built for three schools. 3. Ten houses for teachers constructed at the schools. 4. Additional teachers provided by the government. 5. Malahang clinic expanded.
A2. Provision of Community Facilities
1. A 200-square-meter community center and a sports areaprovided.
2. A roof provided for the existing market. 3. Service utilities provided for the community center.
Implementation of Major Activities: Number of months for grant activities
36 Months
Component B Component Name Income Improvement Cost ($) 430,471Component Description B1. Agricultural Extension for Resettlers
Income generation is fundamental to alleviating poverty. This component will assist in small-scale agricultural and animal husbandry. It will set up demonstration plots for the husbandry of chickens, ducks, rabbits, and fish, and provide training and extension services to the communities in home processing of food products for sale, including chips, jam, dried fruits, snacks, fruit juices, and cookies. The National Agricultural Research Institute will provide most of these services.
B2. Agricultural Extension for Labu Villages
The people of the three Labu villages, about 2 kilometers from the project area, are poor. The crops they cultivate and the animals they raise are used mostly for subsistence. Their
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productivity can be increased to respond to high demands for vegetable and meat products through improved cultivation and husbandry techniques and the marketing of their products to provide them with cash income. The National Agricultural Research Institute will provide most of these services.
B3. Community-Based Floating Fish Cages for Labu Villages
The Labu people are primarily engaged in fishing. The component will help them increase their incomes by establishing community fish cages in the lagoons near their villages. Activities will include: (i) construction and operation of the demonstration floating fish cages, (ii) provision of resources to set up 10 community-managed floating fish cages, and (iii) assistance in fish processing and marketing. A fishery specialist with the appropriate technical knowledge will be engaged to provide assistance.
B4. Microcredit Program for Resettlers and Labu People
Microcredit has proved to be an effective means to alleviate poverty. Wau Microbank Limited is the only bank in Lae providing microcredits. Under this component, the Morobe Provincial Administration (MPA) will provide a grant to the bank as a deposit to ensure that applicants from the two communities to be affected can access credits to set up and finance businesses without collateral. An NGO will be engaged to give business training and help applicants fill in the necessary bank forms and documents with the extensive information required. Wau Microbank Limited will be required to target women applicants from the two communities for 3 years. After 3 years, it will be allowed to open the program to poor applicants from other communities to increase the impact on poverty reduction. The exit strategy will be spelled out in the memorandum of understanding that will be signed between the Morobe Provincial Administration and Wau Microbank Limited.
Monitorable Deliverables/ Outputs
B1. Income Improvement for the Resettlers
1. Demonstrations for animal husbandry and demonstration plots for vegetable production.
2. Demonstrations and training in the small-scale home processing of food products.
3. Volume of pigs, chickens, rabbits, and vegetables sold monthly.
B2. Agricultural Extension for Three Labu Villages
1. Demonstrations for animal husbandry and vegetable production.
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2. Volume of pigs, chickens, rabbits, and vegetables sold monthly.
B3. Community-based Floating Fish Cages for Labu Villages
1. Aquaculture extension assistance. 2. Ten community-managed floating fish cages for
community operation. 3. Advice and assistance in processing fish for sale. 4. Assistance to the communities to market these fish
products.
B4. Microcredit Program
1. Wau Microbank Limited in Lae determining eligible borrowers, providing credit to small-scale businesses from the targeted communities with no collateral and no individual deposits, and monitoring the businesses and repayment.
2. NGO providing business training and assisting in completing the required bank forms.
Implementation of Major Activities: Number of months for grant activities
36 Months
Component C Component Name Livelihood Enhancement Training for the ResettlersCost ($) 87,510Component Description C1. Livelihood, Health, and Nutrition Training for Women
Women have an important role in families and society. The component will give women skills training and short courses on child care, HIV/AIDS awareness, health, nutrition, sanitation, community responsibilities, sewing, and cooking. Activities will include livelihood and skills training for female trainers in a 1-year program to be carried out by the Catholic Women’s Association. The women will take courses in sewing, tourism, basic English, and basic math. The trained women will assist others. Women will also receive 6-week courses at the community center on HIV/AIDS awareness, health, nutrition, sanitation, sewing, cooking, child care, and community responsibilities.
C2. Vocational Training for Men
Based on market demand, the component will equip men with vocational skills so that they can contribute to their families and society. Activities will include (i) vocational training of 1
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year for young men at the Youth Development Center at 3-Mile, and (ii) technical training lasting 1 year for men at the St. Joseph Technical School in the metal work, motor mechanics, carpentry and joinery trades.
Monitorable Deliverables/ Outputs
Livelihood Training 1. Candidates selected by the communities. 2. Skills training provided to 40 women each year for 2
years.3. Twenty-four short training courses conducted for
women—26 women at a time. 4. Three 1-year vocational training courses provided to 75
young men at the Youth Development Center. 5. Three 1-year vocational training courses for 75 men
provided at the St. Joseph Technical School. Implementation of Major
Activities: Number of months for grant activities
36 Months
Component D Component Name Monitoring of Resettlement and Livelihood Improvement Cost ($) 150,000Component Description External independent monitoring is a good way to enhance
project effectiveness. JFPR offers an opportunity for ADB to engage a monitoring agency directly, which will ensure independent monitoring and evaluation, and timely identification and correction of problems. Under monitoring financed by an ADB loan, the contract would be between the Executing Agency and the monitoring agency, which could subject monitoring and evaluations to the Executing Agency’s influence.
Monitorable Deliverables/ Outputs
Monthly and quarterly monitoring reports, and a final evaluation report to the Implementing Agency, and to ADB for review and disclosure on ADB website.
Implementation of Major Activities: Number of months for grant activities
36 months
2. Financing Plan for Proposed Grant to be Supported by JFPR
Funding Source Amount ($)
JFPR 1,500,000
Government 271,000
Community Contribution 19,000
Total 1,790,000ADB = Asian Development Bank, JFPR = Japan Fund for Poverty Reduction, HIV/AIDS = human immunodeficiency syndrome/acquired immune deficiency syndrome, NGO = nongovernment organization.
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3. Background
1. At the request of the Government of Papua New Guinea (PNG), and in line with the Asian Development Bank’s (ADB) country strategy and program (CSP) for PNG 2006–2010,1
ADB is preparing the Lae Port Development Project (the Loan Project) to relieve a key infrastructure bottleneck. The Project involves construction of new port facilities in a swamp area now occupied by 482 households with a population of 2,912 from various provinces of PNG. They are among the poorest of PNG’s people and have lived in an unhealthy environment for more than two decades. They will be relocated under the Loan Project, and are qualified as directly affected people, according to ADB’s Involuntary Resettlement Policy (1995).
2. The Labu people with a population of about 3,000 live about 2 kilometers (km) from the project area, existing mainly on subsistence agriculture and fishery. They will lose a canoe landing site and a nearby fish market under the Loan Project, and are qualified as indirectly affected people, according to ADB’s Involuntary Resettlement Policy.
3. The Loan Project will provide 700 square meters of land and a basic one-bedroom house for each resettled household. It will also compensate Labu people with an alternative landing site and a fish market. The land for resettlement will be leased by the Government of PNG (the Government) from the Ahi people at full replacement costs.
4. The JFPR Project will target the resettlers and the Labu people. It is linked closely with, and complements, the resettlement program of the Loan Project to ensure livelihood sustainability for resettlers, and to help the Labu people transform their production system and move from a subsistence to a cash-based economy. It will have positive externalities, and spread benefits to contractors, consulting firms, training institutes, and communities. It will also reduce social tensions.
5. The Project’s design is based on broad consultations. Although education and health care are basic social services, schools and health facilities in the resettlement site area are already overcrowded. To accommodate 482 resettled households, and provide better social services to the surrounding communities, they will be expanded. To improve living standards and give people opportunities to participate in economic development, the Project also includes training in agriculture and animal husbandry, a microcredit program, the establishment of a community fish culture enterprise, and vocational training for women and men.
4. Innovation
6. The JFPR Project will engage a NGO to document the effort of ADB’s Loan Project to enhance the living condition of landless populations in the project area. This innovation will reinforce the effort of the Loan Project to introduce international best practices in resettlement programs to PNG and enable the Government to formulate laws and regulations on resettlement. The resettlement in Lae could serve as a model for the Government’s administration of development projects, and for its management of the growing problem of landlessness in the country.
7. A second innovative feature will be the introduction of floating fish cage aquaculture as a new approach to improve the livelihood of poor fishermen in the country.
1 ADB. 2006. Papua New Guinea: Country Strategy and Program for Papua New Guinea, 2006–2010. Manila.
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8. Independent external monitoring is also an innovation, and important to ensure that the intervention programs under the Loan and JFPR Projects are executed properly and funds are spent on the intended purposes. The JFPR financing will allow the monitoring agency to be accountable, and report, directly to ADB and the Government of Japan, and to provide unbiased implementation assessment.
5. Sustainability
9. The JFPR Project will be sustainable because it is built on the Five-Year Development Plan (2003–2007) of the Morobe Provincial Government. The plan’s goals include:
(i) Increasing the number of farmers involved in organized cash crop farming and livestock activities, and expanding marketing facilities;
(ii) Increasing commercial small-scale fishing activities by people in coastal and inland areas;
(iii) Increasing small-scale industry development in all districts, and implementing microfinance schemes;
(iv) Reducing maternal and child mortality rates, and the incidence of five diseases common in the province;
(v) Increasing the number of health facilities, including aid posts and rural hospitals; (vi) Increasing health awareness in district and local government health programs; (vii) Improving access to education for all, and increasing appropriate skill
development training, based on employment needs in the public and private sectors; and
(viii) Increasing organized activities for women.
10. The provincial government has agreed to partner with ADB to provide teachers and health workers to sustain the social services. With knowledge transfer and virtuous cycles established, livelihood training and income enhancement components will be self-sustainable.
6. Participatory Approach
11. The JFPR Project was based on wide consultation with a broad range of stakeholders, including provincial government agencies, resettlers, and the Labu people. Three meetings were held with the people to be resettled, and their leaders, during visits to the affected communities of Maus Markham, Wara Tais and Sodas. A public hearing attended by 200 members from the three resettling villages and the three Labu villages was held in January 2007. Consultations with the leaders of Ahi and Labu people occurred on a daily basis.
12. ADB missions and the project preparatory technical assistance consultants met more than 30 times with the NGOs, including Soroptimist International, Habitat for Humanity, Morobe Provincial HIV/AIDS Council, Catholic Education Center, Adventist Development Relief Agency, Lae Chamber of Commerce and Industry, Save the Children, the Young Women Christian Association, and the Wau Microbank Limited.
13. Frequent meetings were held with officials from the Morobe Provincial Administration, Morobe Planning Board, Lae District Administration, Department of Police (community liaison unit and the community policing unit), Department of Education, Provincial Administration’s community development unit, and others.
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Primary Beneficiaries and Other Affected Groups and Relevant Description
Other Key Stakeholders and Brief Description
(i) The resettlers: 482 households with a population of 2,912 from the three settlements of Maus Markham, Wara Tais, and Sodas.
(ii) The Labu people with a population of 3,000 living on the western side of the Markham River.
(i) Morobe Provincial Administration and Lae District Administration, who have the responsibility to provide social services, and promote economic and social development in the province and Lae city.
(ii) Independent Public Business Corporation (IPBC), the Executing Agency for the Loan Project.
(iii) PNG Ports Corporation Limited (PPCL) that has the mandate to manage port infrastructure.
(iv) The Government of PNG.
7. Coordination
14. In the process of preparing the Loan and JFPR Projects, ADB project team coordinated and consulted closely with major agencies to coordinate and complement the efforts and maximize the comparative advantages of the organizations. At an early stage, the ADB Mission made a joint presentation about the Project, with Australian Agency for International Development, to a wide range of agencies, and sought their insights. They included World Bank, International Monetary Fund, Japan International Cooperation Agency, World Health Organization, and UNDP.
15. Consultation meetings with Mr. Tomonori Mashita, Third Secretary from the Japanese Embassy in PNG, were held three times. Mr. Koki Okawa, First Secretary, joined once. At the meetings, the Mission briefed on the progress of the Loan Project, the preparation of the JFPR Project, and its rationale and components. The Mission also sought guidance on eligible costs. The draft Memorandum of Understanding of ADB’s Loan Fact-Finding Mission, which included a draft JFPR program, was sent to the Japanese Embassy for prior review and comments.
8. Detailed Cost Table
16. Please refer to Appendix 2 for the detailed cost estimates, and Appendix 3 for the Fund Flow Arrangement.
C. Link to ADB Strategy and ADB-Financed Operations
1. Link to ADB Strategy
17. PNG is an island nation in the Pacific region. Its territory comprises the eastern half of New Guinea and 600 offshore islands, with a landmass of 462,000 square kilometers. It accounts for more than 80% of the total land area in the South Pacific, and has the largest fishing zone in the Pacific, formed by more than 17,000 km of coastline and 17 million hectares of reef-covered coastal waters. Of its 20 provinces, 15 are located on the coast. More than 60% of its 6 million people are widely dispersed across islands, coral atolls and along the banks of major rivers. There is no national rail or road network. Although 46 airports and many airstrips serve a network of scheduled, charter, and missionary air services, including some to very remote communities, the costs of air transport prohibit all but emergency trips.
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18. The port sector plays a crucial role in the social and economic development of PNG. It is important not only for adequate and efficient handling of exports and imports, but also for the efficient movement of goods and people between the centers of economic activities and the country’s remote and sparsely populated areas, both on the mainland and on the islands. Lae port is PNG’s largest, busiest, and most important port. It handles about half of the total throughput of the 22 declared ports and more than 60% of the total international and coastal trade registered in the ports managed by PPCL, and generates over 50% of PPCL’s total revenue. It serves as a gateway linking the world market with a large hinterland comprising the city of Lae, which is PNG’s industrial and commercial center, Morobe province, and five resource-rich Highlands provinces. The region is home to about half of PNG’s population and represents 50% of PNG’s territory.
19. Since 1995, Lae port has experienced rapid annual growth in containerized cargo of more than 5%. General cargo has increased by 2.5% per annum. Cargo volume reached 2.4 million revenue tons in 2005, stretching Lae port to its limits. With PNG’s economic prospects remaining strong, and the region experiencing a boom in development, the problem is expected to get worse. Unless capacity is expanded and management efficiency is improved, the bottleneck in Lao port will stifle PNG’s economic growth.
20. ADB’s CSP for PNG 2006–2010 focuses on four strategic areas: (i) public financial management, (ii) private sector development, (iii) the transport sector, and (iv) health and HIV/AIDS. It recognizes that the maritime subsector is critical to PNG’s economy, and that ADB should continue to focus on road and maritime subsectors. Specifically, ADB would support the Highlands Highway Rehabilitation Project and Lae Port Development Project.
Document DocumentNumber
Date of Last Discussion Objective(s)
ADB Country Strategy and Program(CSP) 2006–2010
Sec. M58-06
June 2006 Key objective is to help the Government to meet its Mid-Term Development Strategy goals of (i) good governance, (ii) export-driven economic growth, (iii) rural development, poverty reduction, and human resource development.
Five-YearDevelopment Plan 2003–2007 of MorobeProvincialGovernment
Five key objectives:
(i) To improve the health of the people, (ii) To increase access to educational
services and provide more appropriate education and better operated schools in the province,
(iii) To encourage and promote opportunities for income earning and business development in the communities,
(iv) To improve and increase agriculture and livestock production, and
(v) To promote development of fisheries and marine resources for income-earning opportunities for both coastal and inland fishing populations.
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2. Link to Specific ADB-Financed Operation
Project Name Lae Port Development Project
Project Number 40037
Date of Board Approval 18 December 2007
Loan Amount ($ million) $100 million
3. Development Objective of the Associated ADB-Financed Operation
21. ADB’s Loan Project will aim at promoting trade and industrial and commercial development by relieving a key port infrastructure constraint for PNG. It will finance new port facilities that will bring long-term benefits to the Government, local communities, and the business sector. Resettlement and JFPR activities will extend benefits to settlers and other segments of society, and improve the impact of the Loan Project on poverty reduction.
4. Main Components of the Associated ADB-Financed Operation
No. Component Name Brief Description 1. Port Infrastructure Construction of: a tidal basin (700x400 meters [m])
located to the northwest of the existing port facilities with a dredged depth of 13 m below Chart Datum; a multi-purpose berth (240 m long and 45-50 m wide); and terminal works including all buildings, storage area, roads, drainage, water, electrics, and sewerage services. The tidal basin and berth are designed to accommodate vessels with an overall length of 200 m, beam of 32.2 m, and fully laden draft of 12 m. Flexibility has been built in for: (i) extending the berth by another 150 m without incurring dredging cost, (ii) introducing rail-mounted quayside gantry cranes, heavy mobile cranes, and heavier handling equipment, and (iii) fufure deepening of depth to 15 m below Chart Datum.
2. Resettlement Resettlement site preparation, house provision, relocation, and alternative landing site preparation.
3. Project Management International and national consulting services forproject implementation, financial management, construction supervision, resettlement, and socioeconomic impact monitoring.
5. Rationale for Grant Funding versus ADB Lending
22. PNG is a poor country with limited debt repayment capacity. For sound macroeconomic management, the Government is continuing with its debt reduction strategy and limiting its borrowing for strategic projects only. Resettling landless urban dwellers is not the Government’s priority and execution is generally below international standards. Based on an extensive policy dialogue, the Government is willing to finance the resettlement costs from the ADB loan; however, it wishes to receive grants to finance activities that it considers luxuries but which, in
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ADB’s view, are necessities. Without the JFPR grant, livelihood restoration and income generation activities are at risk, and the number of beneficiaries will be reduced.
D. Implementation of the Proposed Grant
1. Provide the Name of the Implementing Agency
Morobe Provincial Administration
23. All procurements under the JFPR grant will be conducted in accordance with ADB’s Procurement Guidelines (2007, as amended from time to time). Local NGOs and consultants will be contracted by Morobe Provincial Administration in accordance with ADB’s Guidelines on the Use of Consultants (2007, as amended from time to time).
2. Risks Affecting Grant Implementation
Type of Risk Brief Description Measures to Mitigate the Risk
Procurement and Construction Risks.
The Implementing Agency may not be familiar with ADB’s procurement policies.
(1) Procurement training; (2) Appropriate packaging of
contracts;(3) Using the standard bidding
documents and contracts developed by the Implementing Agency, to the extent possible. The standard bidding documents need to be approved by ADB; and
(4) Using consulting services for construction supervision.
3. Incremental ADB Costs
24. No incremental ADB costs are expected.
4. Monitoring and Evaluation
Key Performance Indicator Reporting Mechanism Plan and Timetable for M&E
1. Expansion of school facilities and health center.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
2. Government’s provision of additional teachers and nurses, and operation and maintenance budget.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
13
Key Performance Indicator Reporting Mechanism Plan and Timetable for M&E
3. Attendance at schools by children from the resettled families.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB
4. Provision of skills training for women, short course for women, vocational training for young men and technical school for men.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
5. Provision of funds to Wau Microbank Limited to set up an account to provide micro credits.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
6. Provision of agricultural, animal husbandry, and food process training, demonstration trials, and extension assistance.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
7. Provision of assistance and demonstrations for the floating fish cages in the lagoons near the Labu villages.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
8. Construction and operation of 10 community-based floating fish cages, and fish marketing.
Progress reports by the Implementing Agency.
NGO’s independent monitoring reports.
Monthly progress report.
Monthly monitoring and reporting to ADB.
5. Estimated Disbursement Schedule
Fiscal Year (FY) Amount ($)
FY2008 0.7 million
FY2009 0.5 million
FY2010 0.3 million
Total Disbursements 1.5 million
----------------------------------------------------------------------------- Appendixes
1. Summary Cost Table 2. Detailed Cost Estimates and Contract Packages 3. Fund Flow Arrangement 4. Implementation Arrangements
SU
MM
AR
Y C
OS
T T
AB
LE
14 Appendix 1
($)
Co
mp
on
ent
A:
Im
pro
vin
g S
oci
al
Infr
astr
uct
ure
an
d
Ser
vice
s fo
r th
e P
oo
r C
om
mu
nit
ies
Co
mp
on
ent
B:
Inco
me
Imp
rove
men
t
Co
mp
on
ent
C:
Liv
elih
oo
d
En
han
cem
ent
T
rain
ing
fo
r th
e R
eset
tler
s
Co
mp
on
ent
D:
Mo
nit
ori
ng
of
Res
ettl
emen
t an
d
Liv
elih
oo
d
Imp
rove
men
t
To
tal
(Inp
ut)
1. C
ivil
Wo
rks
602,
218
93,0
0069
5,21
8
2. E
qu
ipm
ent
and
Su
pp
lies
31,0
0023
,250
15,2
0069
,450
3. T
rain
ing
, Wo
rksh
op
s, S
emin
ars,
an
d P
ub
lic C
amp
aig
ns
79,7
6172
,310
152,
071
4. C
on
sult
ing
Ser
vice
s15
,830
234,
460
150,
000
400,
290
5. G
ran
t M
anag
emen
t 0
6. O
ther
Inp
uts
0
Su
bto
tal J
FP
R G
ran
t F
inan
ced
64
9,04
843
0,47
187
,510
150,
000
1,31
7,02
9
7. C
on
tin
gen
cies
(0–
10%
of
tota
l est
imat
ed g
ran
t fu
nd
):
Use
of C
ontin
genc
ies
requ
ires
prio
r a
ppro
val f
rom
AD
B.
182,
971
To
tal J
FP
R G
ran
t F
inan
ced
1,
500,
000
Go
vern
men
t C
on
trib
uti
on
(sa
larie
s fo
r go
vern
men
t sta
ff)27
1,00
0
Co
mm
un
ity
Co
ntr
ibu
tio
n19
,000
To
tal E
stim
ated
Co
sts
1,79
0,00
0
Sou
rce:
AD
B e
stim
ates
.A
DB
= A
sian
Dev
elop
men
t Ban
k, J
FP
R =
Jap
an F
und
for
Pov
erty
Red
uctio
n.
Inp
uts
/ E
xpen
dit
ure
Cat
ego
ryGra
nt
Co
mp
on
ents
DE
TA
ILE
D C
OS
T E
ST
IMA
TE
S A
ND
CO
NT
RA
CT
PA
CK
AG
ES
($
)
Appendix 2 15
834
,218
Sho
ppin
g
2.
Co
nsu
ltin
g S
ervi
ces
a.C
onst
ruct
ion
supe
rvis
ion
10,4
05S
SS
B. C
om
po
nen
t A
2: P
rovi
din
g C
om
mu
nit
y In
fras
tru
ctu
re f
or
All
Su
bto
tal
222,
425
222,
425
00
0
1.
Civ
il W
ork
sa.
Spo
rt a
rea
131
,000
.00
31
,000
Sho
ppin
gb.
Mar
ket
1
62,0
00.0
0
62,0
00S
hopp
ing
c.C
omm
unity
cen
ter
(200
squ
are
met
ers)
193
,000
.00
93
,000
Sho
ppin
g
2.
Eq
uip
men
t an
d S
up
plie
sa.
Ser
vice
util
ities
ye
ar31
,000
3.
Co
nsu
ltin
g S
ervi
ces
a.C
onst
ruct
ion
supe
rvis
ion
5,42
5S
SS
C. C
om
po
nen
t B
1: A
gri
cult
ura
l Ext
ensi
on
fo
r R
eset
tler
sS
ub
tota
l96
,906
96,9
06S
SS
00
0
1.
Trai
nin
g, W
ork
sho
ps,
an
d S
emin
ars
a.B
roile
r an
d ve
geta
ble
prod
uctio
n, d
uck,
rab
bit h
usba
ndry
, aqu
acul
ture
, an
d fo
od p
roce
ssin
gpr
ogra
m7
5,81
4.00
40,7
01
2.
Co
nsu
ltin
g S
ervi
ces
a.E
xten
sion
/out
reac
h pr
ogra
m a
nd a
ssis
tanc
e in
mar
ketin
g pr
oduc
tsye
ar1
56,2
05
D. C
om
po
nen
t B
2: A
gri
cult
ura
l Ext
ensi
on
fo
r L
abu
Peo
ple
93
,000
93,0
00S
SS
00
0
1.
Trai
nin
g, W
ork
sho
ps,
an
d S
emin
ars
a.B
roile
r an
d ve
geta
ble
prod
uctio
n, d
uck
and
rabb
it hu
sban
dry,
aq
uacu
lture
, and
foo
d pr
oces
sing
39,0
60
2.
Co
nsu
ltin
g S
ervi
ces
a.E
xten
sion
/out
reac
h pr
ogra
m a
nd a
ssis
tanc
e in
mar
ketin
g pr
oduc
ts53
,940
Co
sts
Co
ntr
ibu
tio
ns
Co
de
Su
pp
lies
and
Ser
vice
s R
end
ered
JFP
RG
ove
rnm
ent
Oth
erD
on
ors
Co
mm
un
itie
sU
nit
Qu
anti
tyC
ost
Tota
lU
nit
sP
er U
nit
$A
mo
un
tM
OP
A. C
om
po
nen
t A
1: E
xpan
din
g S
cho
ol a
nd
Hea
lth
Fac
iliti
esS
ub
tota
l42
6,62
342
6,62
30
00
1.
Civ
il W
ork
sa.
Sch
ool e
xpan
sion
3
382,
000
NC
Bb.
Exp
ansi
on o
f Mal
ahan
g C
linic
1
34,2
134
,218
.00
16 Appendix 2
Qu
anti
tyC
ost
Tota
lU
nit
sP
er U
nit
$A
mo
un
tM
OP
E. C
om
po
nen
t B
3: C
om
mu
nit
y-B
ased
Flo
atin
g F
ish
Cag
es f
or
Lab
u V
illag
esS
ub
tota
l18
8,46
518
8,46
5IC
S0
00
1.
Civ
il W
ork
sa.
Sin
gle
cage
floa
ting
fish
cage
sca
ge30
3,10
0.00
93,0
00
2.
Eq
uip
men
t an
d S
up
plie
sa.
500
finge
rling
s pe
r ca
geca
ge30
310.
009,
300
b.F
ish
food
pro
duce
d in
Lae
kg15
,000
0.93
13,9
50
3.
Co
nsu
ltin
g S
ervi
ces
a.In
itial
sur
vey
to d
eter
min
e fis
h sp
ecie
sS
urve
y1
5,25
5.00
5,25
5b.
Aqu
acul
turis
t for
fish
cag
e cu
ltiva
tion
day
6062
0.00
37,2
00c.
Per
die
m fo
r aq
uacu
lturis
tda
y60
108.
506,
510
d.F
ish
mar
ketin
g sp
ecia
list
day
2562
0.00
15,5
00e.
Tec
hnic
al s
taff
for
exte
nsio
n as
sist
ance
day
100
46.5
04,
650
f.P
er d
iem
for
tech
nica
l sta
ffda
y10
031
.00
3,10
0
F. C
om
po
nen
t B
4: M
icro
-Cre
dit
Pro
gra
m f
or
Res
ettl
ers
and
Lab
u P
eop
leS
ub
tota
l52
,100
52,1
00S
SS
00
0
1.
Co
nsu
ltin
g S
ervi
ces
a.N
GO
ass
istin
g ap
plic
ants
for
cred
itm
onth
3630
0.00
10,8
00
2.
Oth
er P
roje
ct In
pu
ts (
Sp
ecif
y)a.
Gra
nt to
Wau
Mic
roba
nk L
imite
d fo
r re
volv
ing
fund
gran
t1
41,3
00.0
041
,300
G. C
om
po
nen
t C
1: L
ivel
iho
od
, Hea
lth
, an
d N
utr
itio
n f
or
Wo
men
Su
bto
tal
56,3
9056
,390
SS
S0
00
1.
Trai
nin
g, W
ork
sho
ps,
an
d S
emin
ars
a.S
kills
trai
ning
(T
OT
) fo
r 1-
year
pro
gram
for
wom
en o
ver
3 ye
ars
wom
en12
020
1.00
24,1
20b.
Fou
r sh
ort c
ours
es o
n ch
ild c
are
for
wom
en fo
r 6
wee
ks o
ver
2 ye
ars
wom
en10
462
.29
6,47
8c.
Fou
r sh
ort c
ours
es o
n H
IV/A
IDs
for
wom
en fo
r 6
wee
ks o
ver
2 ye
ars
wom
en10
462
.00
6,44
8d.
Fou
r sh
ort c
ours
es o
n he
alth
, nut
ritio
n, a
nd s
anita
tion
for
6 w
eeks
w
omen
104
62.0
06,
448
e.F
our
shor
t cou
rses
on
sew
ing,
coo
king
, and
chi
ld c
are
for
6 w
eeks
w
omen
104
62.0
06,
448
f.F
our
shor
t cou
rse
on c
omm
unity
res
pons
ibili
ties
for
6 w
eeks
ove
r 2
wom
en10
462
.00
6,44
8
Co
de
Su
pp
lies
and
Ser
vice
s R
end
ered
Un
it
Co
sts
Co
ntr
ibu
tio
ns
JFP
RG
ove
rnm
ent
Oth
erD
on
ors
Co
mm
un
itie
s
Appendix 2 17
Qu
anti
tyC
ost
Tota
lU
nit
sP
er U
nit
$A
mo
un
tM
OP
H. C
om
po
nen
t C
2: V
oca
tio
nal
Tra
inin
g f
or
Men
S
ub
tota
l31
,120
31,1
20S
SS
00
0
1.
Eq
uip
men
t an
d S
up
plie
sa.
Por
tabl
e w
eldi
ng m
achi
nes,
han
d dr
ills,
grin
der,
etc
. (yo
uth
cent
er)
tool
s1
3,20
0.00
3,20
0b.
Por
tabl
e w
eldi
ng m
achi
nes,
han
d dr
ills,
grin
der,
etc
. (te
chni
cal s
choo
l)to
ols
112
,000
.00
12,0
00
2.
Trai
nin
g, W
ork
sho
ps,
an
d S
emin
ars
a.V
ocat
iona
l tra
inin
g fo
r 1
year
ove
r 2
year
sm
en52
57.0
02,
964
b.T
echn
ical
trai
ning
in m
etal
wor
k, m
echa
nics
, car
pent
ry fo
r 1
year
ove
r 2
year
sm
en52
249.
1612
,956
I. C
om
po
nen
t D
: M
on
ito
rin
g o
f R
eset
tlem
ent
and
Liv
elih
oo
d Im
pro
vem
ent
Su
bto
tal
150,
000
150,
000
CQ
S0
00
a.C
onsu
lting
Ser
vice
s15
0,00
0
Co
mp
on
ents
A t
o D
= S
ub
tota
lS
ub
tota
l1,
317,
029
Co
nti
ng
ency
(M
axim
um
12%
of
tota
l JF
PR
Co
ntr
ibu
tio
n)
182,
971
Tota
l1,
500,
000
1,50
0,00
027
1,00
019
,000
Co
ntr
ibu
tio
ns
Co
de
Su
pp
lies
and
Ser
vice
s R
end
ered
Un
itJF
PR
Go
vern
men
tO
ther
D
on
ors
Co
mm
un
itie
s
Co
sts
CQ
S =
con
sulta
nts’
qua
lific
atio
ns s
elec
tion,
ICS
= in
divi
dual
con
sulta
nt e
lect
ion,
JF
PR
= J
apan
Fun
d fo
r P
over
ty R
educ
tion,
MO
P =
met
hod
of p
rocu
rem
ent,
SS
S =
sin
gle
sour
ce
sele
ctio
n (ju
stifi
ed e
ither
bec
ause
the
amou
nt is
less
than
$10
0,00
0 or
bec
ause
the
expe
rtis
e is
onl
y w
ith a
spe
cific
org
aniz
atio
n or
an
indi
vidu
al),
TO
T =
trai
ning
of t
rain
ers.
S
ourc
e: A
sian
Dev
elop
men
t Ban
k es
timat
es.
18 Appendix 3
FUND FLOW ARRANGEMENT
1. The Asian Development Bank (ADB) will channel the Japan Fund for Poverty Reduction (JFPR) funds directly to a JFPR imprest account, which will be opened and maintained by IPBC’s project management unit (PMU), at a bank endorsed by IPBC and acceptable to ADB, to facilitate day-to-day local expenditures of the JFPR Project. The imprest account will be established, managed, replenished and liquidated in accordance with ADB’s LoanDisbursement Handbook (2007, as amended from time to time). IPBC will keep records of all transactions, prepare all financial statements, and have them audited. The JFPR imprest account will be managed by the PMU on the principles of a co-signatory arrangement with Morobe Provincial Administration for withdrawal applications, initially based on the first 6-month activity plan and the related budget, and afterwards based on the approved annual work plan and budget.
2. Interest earned on the JFPR imprest accounts can be used for the Project, subject to ADB's approval, within the approved total amount of JFPR. Upon completion of the JFPR Project and before closing of the JFPR imprest account, any unutilized interest should be returned to the JFPR fund account maintained at ADB. If the remittance fee and other bank charges are higher than the amount of interest earned, there will be no need to return such interest to the JFPR account maintained at ADB.
3. The initial amount deposited into the imprest account as advance for day-to-day project implementation during the inception period will be 10% of JFPR amount, or equivalent to 6- month expenditure, whichever is lower. The imprest account will be replenished every 3 to 6 months, based on the replenishment requests from the PMU in accordance with ADB’s statement of expenditures procedure. The statement of expenditures (SOE) procedure will apply for all payments and transactions under $10,000 to ensure speedy project implementation. The payment in excess of the SOE ceiling will be replenished based on full supporting documentation. Detailed implementation arrangements, such as the flow, replenishment, and administrative procedures, will be detailed in the grant implementation manual and be established between ADB and the Government of Papua New Guinea through the JFPR Letter of Agreement. The schematic fund flow for the JFPR Project is shown in Figure A3.
Appendix 3 19
Figure A3: Fund Flow Arrangement for the JFPR Project
Asian Development Bank
NGO for Independent Monitoring
JFPR Imprest Account Managed by PMU, IPBC
Morobe Provincial Administrationa
Component A Improving Social
Infrastructure and Services for the Poor Communities
Component C Livelihood Enhancement
Training for the Resettlers
Component B Income Improvement
$150,000
$649,048 $87,510
$430,471
JFPR = Japan Fund for Poverty Reduction, NGO = nongovernment organization, PMU = project management unit, IPBC = Independent Public Business Corporation. a Only for the co-signature purpose. The actual money will flow straight to beneficiaries.
20 Appendix 4
IMPLEMENTATION ARRANGEMENTS
1. The Japan Fund for Poverty Reduction (JFPR) Project will be implemented by the Morobe Provincial Administration (MPA). MPA is the administrative arm of the Morobe Provincial Government (MPG). MPG was established under The Organic Law on Provincial Governments and Local-level Governments in 1995. It has political and administrative structures, between which, there is a clear demarcation of responsibilities. The two structures and their relationship are indicated in Figure A4.1.
2. In the past, MPA has successfully implemented other donor-funded projects without political interference, such as Kamlawa Water Supply, Malahang Health Centre, Lae City Water Supply, Lae City Roads Rehabilitation, and Mutzing Water Supply. The implementation of the JFPR Project will come directly under the office of the provincial administrator. A project management committee headed by the deputy provincial administrator will be established to organize and carry out various activities, including bidding, contract awards, and progress monitoring and reporting. The project coordinator will be the manager of the management of information unit, who is a development economist by background. Professional assistance will also be drawn from the planning, works, tenders board, health, education, Lae district and Lae urban local-level-government divisions of MPA. Regular project progress reports will be provided to the MPG, Independent Public Business Corporation, and Asian Development Bank. The organizational structure for implementing the JFPR Project is in Figure A4.2
3. The JFPR Project will be implemented over a period of 3 years from 2008 to 2010. Procurement of goods, services, and works will follow ADB’s Procurement Guidelines (2007, as amended from time to time). The contract packages and procurement methods are indicated in Appendix 2. Recruitment of consulting services will follow ADB’s Guidelines on the Use of Consultants (2007, as amended from time to time).
4. The JFPR Project is an integral part of ADB’s package for the Lae port development. It complements ADB loans and efforts of the OPEC Fund for International Development, which will co-finance civil works, and Cooperation Fund for Fighting HIV/AIDS in Asia and Pacific which will finance HIV/AIDS interventions. To show the totality of ADB’s Loan Project, ensure internal coordination between activities funded by different sources, and strengthen financial management, financial management will be centralized in Independent Public Business Corporation’s PMU, the Executing Agency for the Loan Project. PMU will open an imprest account for the JFPR Project with a commercial bank with an initial amount equivalent to 10% of JFPR amount or 6-month expenditure, whichever is lower. It will disburse funds to MPA, maintain records and supporting documents, replenish the imprest account, and arrange auditing. The auditor’s report will include the certified copies of the audited accounts and financial statements, with separate auditor’s opinion on the use of the imprest account and a statement of expenditures authorized under the JFPR Project. They will be submitted to ADB within 6 months after the end of each fiscal year.
Appendix 4 21
Source: Morobe Provincial Administration, Papua New Guinea.
Figure A4.1: Provincial Political and Policy Implementation Structure Figure A4.1: Provincial Political and Policy Implementation Structure
PROVINCIAL ASSEMBLY
SECTOR COMMITTEE
JOINT PROVINCIAL PLANNING AND BUDGET PLANNING COMMITTEE
PROVINCIAL EXECUTIVE COUNCIL
LOCAL GOVERNMENT COUNCIL
WARD COMMITTEE
P E O P L E
PROVINCIAL ADMINISTRATOR
PROVINCIAL PROGRAM MANAGEMENT TEAM
LOCAL GOVERNMENT MANAGER AND PROJECT MANAGER
JOINT DISTRICT PLANNING AND BUDGET PLANNING
COMMITTEE
DISTRICT PROGRAM MANAGEMENT TEAM
PROJECTS
22 Appendix 4
PR
OV
INC
IAL
AS
SE
MB
LY
DE
PU
TY
PR
OV
INC
IAL
AD
MIN
IST
RA
TO
R,
CO
RP
OR
AT
E A
FF
AIR
S
DE
PU
TY
PR
OV
INC
IAL
AD
MIN
IST
RA
TO
R A
ND
D
IST
RIC
T A
DM
INIS
TR
AT
OR
MA
NA
GE
R, M
AN
AG
EM
EN
T O
F
INF
OR
MA
TIO
N U
NIT
LAE
CIT
Y
CO
UN
CIL
E
NV
IRO
NM
EN
TLA
ND
SW
OR
KS
ED
UC
AT
ION
HE
ALT
HP
RO
VIN
CIA
LT
EN
DE
RS
B
OA
RD
Fig
ure
A4.
2: P
roje
ct Im
ple
men
tati
on
Org
aniz
atio
nal
Str
uct
ure
Sou
rce:
Mor
obe
Pro
vinc
ial A
dmin
istr
atio
n, P
apua
New
Gui
nea.
