AFRICAN DEVELOPMENT BANK

TOGO

TOGO AGRO-FOOD PROCESSING PROJECT (PTA-TOGO)

ADDITIONAL FINANCING FROM THE NIGERIA TRUST FUND (NTF)

RDGW/AHFR DEPARTMENTS

April 2019

Translated document

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Table of Contents

Currency Equivalents, Fiscal Year, Weights and Measures, Acronyms and Abbreviations, Project Profile i-v

I. SUMMARY OF THE INITIAL PROJECT (PTA-TOGO) APPROVED ON

18/07/2018................................................................................................................................ 1

1.1 Strategic Framework ................................................................................................1

1.2 Objectives ..................................................................................................................1

1.3 Expected Outcomes ...................................................................................................1

1.4 Brief Description of Project Components ................................................................2

1.5 Cross-Cutting Issues .................................................................................................2

1.6 Implementation Arrangements.................................................................................3

1.7 Status of the Initial Project Approved on 18 July 2018 ...........................................3

II. RATIONALE AND PURPOSE OF THE NTF LOAN ............................................... 4

2.1 Rationale for NTF Financing ....................................................................................4

2.2 Purpose of the NTF Funding ....................................................................................4

III. MAIN ACTIVITIES TO BE FINANCED FROM THE NTF LOAN ........................ 4

3.1 Description of Activities to be financed from the NTF Loan ...................................4

3.2 Expected Outcomes ...................................................................................................5

3.3 Compliance of Additional Activities with Environmental and Social Provisions ...5

3.4 Procedure for Implementing the Additional Funding .............................................6

IV. COST OF THE ADDITIONAL LOAN AND REVISED FINANCING PLAN ......... 8

4.1 Breakdown of the Cost of the NTF Additional Financing .......................................8

4.2 Revised Cumulative Financing Plan of the PTA-Togo (including NTF funding) ...8

V. LEGAL FRAMEWORK OF THE NTF ADDITIONAL FINANCING .................. 10

5.1 Legal Instrument ..................................................................................................... 10

5.2 Conditions Associated with Bank Involvement ...................................................... 10

5.3 Compliance with Bank Policies............................................................................... 12

VI. RECOMMENDATION ............................................................................................. 12

ANNEXES

Annex I: Letter from His Excellency the Minister of Finance of Nigeria, dated 31 ...

August 2018, confirming the allocation of UA 4 million for the PTA-Togo. I

Annex II: Detailed Description of the Revised Project (including the NTF) ............... II

Annex III: Revised Results-based Logical Framework of PTA-Togo (including the ....

NTF-funded components) .......................................................................... VII

Annex IV: Provisional Revised Project Implementation Schedule ............................... X

Annex V: Procedures for Procurement from NTF Loan Resources ........................ XIV

Annex VI: Map of the Project Location (including the NTF components) ............... XIX

i

CURRENCY EQUIVALENTS – February 2019

Currency Unit : CFAF

UA 1 : CFAF 799.78869 EUR 1 : CFAF 655.957

FISCAL YEAR

1 January – 31 December

WEIGHTS AND MEASURES

Metric System

ii

ACRONYMS AND ABBREVIATIONS

ADF African Development Fund (of the Bank Group) ANGE National Environmental Management Agency

APA Advance Procurement Action

APD Detailed Engineering Design

APS Preliminary Engineering Design AUSEPA Drinking Water and Sanitation Users’ Association

AUSI Irrigation Water Users’ Association

CRP Comprehensive Resettlement Plan CSP Country Strategy Paper (of the Bank)

CTA Agro-Processing Centres (Village Centres)

DCE Bidding Documents DPA Agricultural Policy Document (2016-2030)

DREHV Regional Directorate of Water and Village Hydraulics

DWS Drinking Water Supply

ECOWAS Economic Community of West African States ERR Economic Rate of Return

ESIA Environmental and Social Impact Assessment

ESMP Environmental and Social Management Plan HDI Human Development Index

HIMO Labour Intensive

HOP Human-Operated Pumps

ICT Information and Communication Technologies INDC Intended Nationally Determined Contribution

ISS Integrated Safeguards System

ITRA Togo Institute for Agronomic Research NTF Nigeria Trust Fund

PDA Public Development Assistance

PGPP Pests and Pesticides Management Plan PMU Project Management Unit

PPF Project Preparation Fund

RAP Resettlement Action Plan

SESA Strategic Environmental and Social Assessment/ SME Small and Medium-Sized Enterprise

TFP Technical and Financial Partners TSF Transition Support Facility

VRD Roads and Sundry Networks

WB World Bank

WSC Water and Soil Conservation ZTA Agro-Food Processing Zone

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PROJECT INFORMATION SHEET

Client Information

_____________________________________________________________________

BORROWER : Republic of Togo

EXECUTING AGENCY : Agency for Promotion and Development of Agropoles in

Togo (APRODAT), established by Decree No. 2018-

036/PR of 27 February 2018

Revised Financing Plan (including NTF funding)

Source Amount (UA

M.)

Amount

(CFAF M.)

Amount

(USD M.) Instrument

ADF (including PPF) 4 635.00 3.619.700 Grant

ADF 8 040.00 6.278.830 Loan

TSF (Pillar I) 8 320.00 6.497.500 Loan

BOAD 12 804.92 10 000 000 Loan

Saemaul Globalization Foundation (South Korean)

3 524.19 2.752.220 5 000 Grant

Nigeria Trust Fund 4 000.00 3 199.160 Loan

Government 7 741.95 6.046.080 Budget

TOTAL COST 49 066.07 38 393.490

*PPF advance: UA 995 000

Financial Information on the NTF Additional Loan

Maturity (years) 27

Grace Period (years) 7

Principal Amount Amortisation Annual rate. Applies to the undisbursed amount. Effective 120

days from the signing of the loan agreement, with half-yearly

payments on payment Dates

Service Commission (%) 0.75

Payment of Commitment Fee Annual rate. Applies to the outstanding amount disbursed.

Half-yearly payments on payment dates

Commitment Fee (%) 0.5

Payment of Commitment Fee Annual rate. Applies on the undisbursed amount. Effective

120 days from signature, with half-yearly payments on

payment dates

Interest Rate (%) NA

Payment of interest amounts NA

Concessionnality (%) 51.4%

NPV (baseline scenario) CFAF 56 959 375

ERR (baseline scenario) 23.23% Timeframe – Key Milestones (expected)

Concept Note Approval March 2018

Project Approval July 2019

Approval of the NTF Financing April 2019

Effectiveness May 2019

Last Disbursement December 2023

Completion September 2023

Last reimbursement December 2046

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RECOMMENDATION OF THE BANK MANAGEMENT TO THE BOARD OF

DIRECTORS CONCERNING A PROPOSED NTF ADDITIONAL FINANCING FOR

THE TOGO AGRO-FOOD PROCESSING PROJECT (PTA-TOGO)

Management hereby submits this memorandum and recommendation concerning the grant of

additional funding from the Nigeria Trust Fund (NTF), not exceeding UA 4 million, to finance the

activities of the Togo Agro-Food Processing Project (PTA-Togo). These supplementary financial

resources will be used to develop 600 ha of irrigated areas with full water control downstream of

the B1 dam, build 4 mini-drinking water supply (DWS) networks fed by the new boreholes that will

be drilled and equipped, drill 30 boreholes equipped human-operated pumps and rehabilitate 8

boreholes equipped with human-operated pumps. These additional activities will be perfectly

feasible in the current planning of PTA-Togo implementation, which will help increase the

outcomes of this project, especially by boosting the resilience of the agro-pastoral production system

to climate change, and by improving access to drinking water for rural households and small and

medium-sized enterprises (SMEs) engaged in the processing activities planned for 10 agricultural

processing centres (CTA).

I. SUMMARRY OF THE INITIAL PROJECT (PTA-TOGO) APPROVED ON 18/07/20181

On 18 July 2018, the Board of Directors of the Bank Group approved for the Togo Agro-Food

Processing Project (PTA-Togo) a total amount of UA 20.95 million, broken down as follows: (i)

ADF loan: UA 8.04 million (17.8%); ADF grant: UA 4.046 million (10.3%); and TSF loan: UA

8.32 million (18.5%). The amounts mobilized under a co-financing arrangement are

approximately UA 12,804,920 (28.4%) coming from the West African Development Bank

(BOAD) and UA 3,524,190 (7.8%) from the Saemaul Foundation for Globalization (Korea). The

total amount is about UA 45,066,070 (nearly CFAF 35,194 billion) upon which UA 7,741,950

(17.2%) from the Togolese State as counterpart funding. The project, which covers the Kara

region, is planned to span a five-year period (2019-2023).

1.1 Strategic Framework

1.1.1 The Togo Agro-Food Processing Project (PTA-Togo) is a pilot project implemented as

part of the Togo Agropoles Strategic Development Plan 2017-2030 and the Feed Africa Initiative

2016-2025. The project is in line with the Bank’s Country Strategy Paper (CSP) 2016-2022, Pillar

1 of which concerns the development of inclusive growth and agribusiness competitiveness poles,

through the development of agro-industrial processing zones.

1.2 Objectives

1.2.1 The overall objective of the project is to promote inclusive agricultural growth that

creates jobs and reduce food imports thanks to incentive measures for private investment in key

areas. The specific objectives of the project are to: (i) facilitate private investments in key areas

thanks to policy support, governance and incentive measures; (ii) promote the development of

priority value chains through the establishment of infrastructure to support production, storage

and processing; and (iii) build the capacity of stakeholders in priority agro-industrial areas.

1.3 Expected Outcomes

1.3.1 The main expected outcomes are as follows: (i) increase in the productivity and

agricultural production of import substitutes (rice, maize, soybean, broiler meat) and exports

(cashew nuts and sesame); (ii) increase in the share of agricultural products processed in situ

1 See Board Resolution No. B/TG/2018/35 - F/TG/2018/53

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(from 19% to 40%) through private investment in the Agro-park (90,000 tonnes/year of paddy

rice, 15,000 tonnes/year of maize, 10,000 tonnes/year of soybean, 20,000 tonnes/year of feed,

10,000 tonnes/year of cashew nuts and 10,000 tonnes/year of sesame, production of 3 million

chicks per year, slaughtering of 2 million broilers/year); (iii) strengthening of the people’s food

and nutritional security; and (iv) creation of wealth and employment, including for young people

and women.

1.4 Brief Description of Project Components

1.4.1 This project was prepared on the basis of reports of feasibility studies conducted with

financing granted from the Project Preparation Fund (PPF) by the Bank. PTA-Togo is a pilot

project consisting of 4 components: (a) Support policies, governance and incentive measures:

incentive measures, land security, standardization and metrology, single window, agro-park

management, support for financial and non-financial institutions, etc.; (b) Support infrastructure

for processing, production and access to inputs and agricultural services: servicing of the agro-

industrial park, construction of storage dams, design study on irrigated areas, rehabilitation of

rural roads, creation of 10 agricultural processing centres, etc.; (c) Capacity building for agro-

industrial actors: primary storage, access to agricultural inputs and services, training of actors,

implementation of the Strategic Environmental and Social Assessment (SESA) (compensation,

resettlement, ESMP, etc.), support for the implementation of priority sub-projects, etc.; and (d)

Steering, Coordination, Management and Monitoring and Evaluation.

1.5 Cross-Cutting Issues

1.5.1 Environmental and Social Safeguards (Annex B5 of the PAR): In accordance with the

requirements of the Integrated Safeguards System (ISS), the project was classified in Category 1. A

strategic environmental and social assessment (SESA) was conducted to ensure that the incidence

of the future activities carried out in the project area have already been taken into account and

possible mitigation measures identified. The SESA was approved by the Togo National

Environmental Management Agency (ANGE) on 23 February 2018. A summary of the assessment

was published on the AfDB website on 27 February 2018. Lastly, in implementing the SESA,

account will be taken of AfDB and BOAD safeguards policies and the environmental laws of the

Republic of Togo complied with for each activity to be developed on the site.

1.5.2 Involuntary Resettlement (Annex B5 of the PAR). Resettlement action plans are being

prepared for the Agro-park and rural infrastructure. Based on the estimated land area that will be

affected and the value of the land in the area, a provision of CFAF 800 million has been earmarked

for the compensation of affected persons. A resettlement master plan (RMP) will also be prepared

as part of the project. Although it is not a tool proposed by the Bank’s ISS, the RMP is required as

a precaution, to specify the procedure by which land that is not currently affected by the project will

be developed subsequently.

1.5.3 Climate Change: Togo and the Kara region are facing severe deforestation related to tree-

cutting for farming and alternative income-generation needs. The rate of deforestation is about

15,000 hectares/year, compared with a reforestation rate barely exceeding 3,000 hectares/year. This

situation compounds the problem of climate change by depleting carbon stock. The PTA also has

the potential to contribute to greenhouse gas emissions, owing to tree-cutting for farmland

development, rice production and building of dams.

1.5.4 Gender: The initial project is classified in Category 2, according the Gender Marker

System. The detailed gender analysis of the entire value chain has been made and measures

recommended to address the main constraints faced by women, including land insecurity, access to

improved seeds, access to equipment, and outlets for the marketing of agricultural products. The

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budget for the implementation of the gender promotion and women’s empowerment component

stands at UA 7.2 million. Details on gender mainstreaming support activities are provided in Annex

B.7 of the PAR.

1.6 Implementation Arrangements

1.6.1 The PTA-Togo will be implemented by the Agency for the Promotion and Development

of Agropoles in Togo (APRODAT), which was established by Decree No. 2018-036/PR of 27

February 2018 to develop 10 agropoles over the next 15 years and promote private investment. The

Ministries responsible for Agriculture and Industry respectively will provide joint supervision of

APRODAT which has two organs: (i) a Board of Directors, chaired by the Prime Minister, and

comprised of seven active members (public and private) and observer members, and which meets

twice a year; and (ii) a Directorate-General (DG). The essential staff necessary for the proper

functioning of the DG was identified at appraisal and its profile predefined.

1.6.2 Procurement. The procurement of goods (including non-consultancy services), works and

consultancy services, financed by the Bank as part of the project, will be carried out in accordance

with the Procurement Framework for Bank Group-Funded Operations, October 2015 edition

and the provisions set out in the Financing Agreements. The mission has defined the procurements

to be carried out according to the Borrower's Procurement System and those to be made following

the Bank's procurement methods and procedures. Details concerning procurements financed with

TSF and ADF resources are provided in Annex B5.

1.6.3 Financial Management. The mechanism required for the operationalization of an

APRODAT financial management system was defined in the Project Appraisal Report (PAR),

taking into account the assessment of fiduciary risks that was deemed high. Despite finalization of

the organization chart and recruitment of key personnel, some of the specific measures envisaged in

the PAR are yet to be carried, including the following: (i) development of the administrative,

financial and accounting procedures manual, on which its internal oversight system, covering all

management cycles; (ii) development, where appropriate, of an operations manual for facilitation

and financial intermediation activities); (iii) establishment of an integrated multi-project and multi-

user management system to ensure the keeping of budgetary, analytical and general budget accounts

of the project; and (iv) establishment of internal audit mechanisms, with the recruitment of an

Internal Auditor on a competitive basis. Details of the financial management of the initial project

are provided in Annex B4 of the PAR.

1.6.4 Disbursements: The three types of Bank financing (ADF Grant, ADF Loan and TSF

Loan) approved for the initial project will be mobilised in accordance with the rules and procedures

of the Bank Disbursement Manual through the three disbursement methods: (i) direct payment (for

the procurement of works, goods and services and other relatively high-cost expenditure...); (ii) the

special account (mainly for operating expenditure); and (iii) reimbursement, where appropriate.

1.7 Status of the Initial Project Approved on 18 July 2018

1.7.1 The Board of Directors of the Project Executing Agency (Agency for the Promotion and

Development of Agropoles of Togo - APRODAT) is in place, key personnel are already available

and start-up activities are ongoing. The signing of the three financing agreements (ADF grant,

ADF loan and TSF loan) on 27 August 2018 preceded the effectiveness of the said agreements

on 11 October 2018. Also, the conditions precedent to the first disbursements were fulfilled on

18 January 2019 and first disbursement was made on 1 March 2019. Lastly, the official launch

of the initial project is scheduled for March 2019.

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II. RATIONALE AND PURPOSE OF THE NTF LOAN

2.1 Rationale for NTF Financing

2.1.1 As part of the PPF-financed project preparation studies, comprehensive studies had been finalized to enable the setting up of (i) 4 mini-drinking water supply (DWS) networks in four village

centres, and; (ii) manually operated pumps (MOPs) in other locations in the project area. In addition, the initial project, as approved, also incorporates detailed design studies on two storage dams and 1,200 ha of

irrigated land (for rice and maize/soybean crops). Due to lack of resources, a financing request had been submitted to the NTF during the project preparation process. Given that the NTF's formal response did

not reach the Board before Board presentation, no provision was made for these infrastructure components

(irrigated areas and DWS) in the approved initial funding.

2.1.2 That is why this NTF additional financing is fully justified, since it allows for the development of part of the irrigated areas (for sustainable increase in agricultural productivity) and also helps to

guarantee access to drinking water for households and small and medium-sized enterprises (SMEs) located in village centres, particularly those involved in the processing of agricultural products and related

service delivery. The NTF funding is, therefore, intended to finance the implementation of these two

essential components that would increase the resilience of agro-pastoral production systems and boost

agricultural processing capacities to ensure the achievement of the project’s expected outcomes.

2.2 Purpose of the NTF Funding

2.2.1 This additional funding from the Nigeria Trust Fund (NTF) is intended to finance the

development of irrigated areas and drinking water supply systems in certain localities in the

initial project area (Kara region). The specific objective of the NTF loan is (i) to develop gravity

irrigated areas (about 600 ha) downstream of the agro-park dam; (ii) provide drinking water

supply (DWS) to four village centres and secondary localities to meet the needs of households

and agro-entrepreneurs.

III. MAIN ACTIVITIES TO BE FINANCED FROM THE NTF LOAN

3.1 Description of Activities to be Financed from the NTF Loan

3.1.1 The activities planned to be financed by the NTF additional financing were included in

the Concept Note approved by the Country Team of 28 February 2018 and the Operations and

Quality Assurance Committee (SNOC) of 9 March 2018. These activities were then removed

from the PTA-Togo financing plan to cope with the lack of resources noted at appraisal. Thus,

some investments were deferred, including those relating to irrigated areas and drinking water

supply for households and agro-processing SMEs. As such, the summary design report on the

irrigated areas is available and the detailed design studies are planned under the initial financing

of the project (ADF and TSF). For DWS, detailed design reports are already available. Thus, the

proposed activities to be financed by the NTF additional loan dovetail smoothly with the

components initially defined in the PTA-Togo (see the table below, and the revised description

of the components and logical framework in annex – shown in bold).

5

Component/Sub-Component (same

as original project) Cost

(UA M)

Summary Description

Component 2: Support

infrastructure for processing,

production and access to

agricultural inputs and

services /

Sub-component 2.3: Support infrastructure for agricultural

productions

2 405 (i) Development of 600 ha of gravity irrigated area with full water control (canals Ia and IIa covered, works and

equipment) downstream of the agro-park dam for rice

cultivation (30%), maize/soy (60%) and market gardening

(10%); the labour intensive (LI) approach will be

preferred;

(ii) Control and supervision of works on the development of 600 ha of irrigated land (comprehensive studies are already

planned under the initial project).

Component 3: Capacity building for

actors in priority agricultural sectors /

Sub-component 3.2: Capacity building for communities

1 595 (i) Works on the establishment of four mini-drinking water supply (DWS) networks (detailed design study already done by PPF), including the drilling of high-flow boreholes

for four localities (Agbassa, Agounde, Kadjala and Leon);

the labour-intensive approach will be preferred;

(ii) Drilling of 30 boreholes equipped with manually operated pumps, including the construction of superstructures

(detailed design study already done);

(iii) Rehabilitation of eight boreholes (blowing, pumping tests, equipment replacement, water quality);

(iv) Control and monitoring of DWS works (the detailed design report is already available)

TOTAL NTF LOAN 4000

3.2 Expected Outcomes

3.2.1 This NTF additional financing should specifically help to achieve the following outcomes:

(i) increase irrigated rice production (2,000 T/year), maize/soybeans (3,000 T/year), and market

gardening (4,000 T/year), thus securing the supply of raw materials for the Broukou Agro-Park and

the 10 agricultural processing centres; (ii) increase drinking water access rates for households

(numbering 2,195 in total) to 75% (compared to 52% currently); (iii) secure access to drinking water

for processing SMEs (around 100).

3.3 Compliance of Additional Activities with Environmental and Social Provisions

3.3.1 Environmental safeguards. In accordance with the requirements of the Integrated

Safeguard System (ISS), the Project (including NTF-funded activities) has been classified in

Category 1. A Social and Environmental and Strategic Assessment (SESA) has been prepared (see

Annex B8 of the initial project report) in order to taken into account the impact of future activities

in the project area, and the mitigation measures have been identified. The SESA was approved by

the National Environmental Management Agency (ANGE) of Togo on 23 February 2018. A

summary of the assessment was published on the AfDB website on 27 February 2018. In this regard,

the Environmental and Social Impact Assessments (ESIAs), Resettlement Action Plans (RAPs) and

Pest and Pesticide Management Plans (PIPs) that are being prepared (including as part of the DWS

component) or planned in the additional studies, funded from the initial project resources, will make

it possible to implement SESA recommendations (see PAR II, Annex B8, volume II). Thus, the

measures planned in the initial project completely cover the potential impacts of the development

of the irrigated areas and drinking water supply systems envisaged under the NTF, including the

effects of waterborne diseases (schistosomiasis, bilharzia, etc.).

3.3.2 Social Safeguards. The additional benefits of the NTF funding relate to: (i) the

development of intensive agricultural activities; (ii) the creation of direct and indirect jobs,

especially for young people; (iii) the increase in farmers' gross income; and (iv) increase in the

6

people’s purchasing power, resulting in an improvement in the nutritional intake and living

conditions of households. Moreover, the NTF will support the construction of social

infrastructure to improve the people’s living conditions by: (i) financing the creation of mini-

drinking water supply (DWS) networks, drilling new boreholes equipped with human-operated

pumps, and rehabilitating boreholes, using the labour-intensive approach; (ii) carrying out

capacity-building and IEC activities centred around this infrastructure, particularly to combat

waterborne diseases (including bilharziasis).

3.3.3 Involuntary Resettlement. Resettlement Action Plans was prepared for the entire project

that was initially designed, including for the irrigated areas and the drinking water supply networks

financed from the NTF loan. Based on an estimate of the areas that will be affected and the value of

land in the area, a total of CFAF 800 million was allocated for the compensation of affected persons.

Also, a Comprehensive Resettlement Plan (CRP) will be prepared as part of the initial project.

Although the CRP, as an instrument, is not proposed by the AfDB Integrated Safeguards System

(ISS), it is required as a precaution to specify the process through which land that is not currently

covered by the project will be subsequently developed.

3.4 Procedure for Implementing the Additional Funding

3.4.1 The project financed from the NTF additional funding will be implemented by the same

entity currently implementing the PTA-Togo, namely the Agency for the Promotion and

Development of Agropoles in Togo (APRODAT), which was established by Decree No. 2018-

036/PR of 27 February 2018 to develop 10 Agropoles over the next 15 years and promote private

investment. The Ministries responsible for Agriculture and Industry, respectively, will jointly

supervise APRODAT which has two organs: (i) a Board of Directors, chaired by the Prime Minister,

and comprised of seven active members (public and private) and observer members; and (ii) a

Directorate-General (DG). The essential staff necessary for the proper functioning of the DG was

identified at appraisal and its profile predefined. The recruitment of key staff has just been

completed. This staff is sufficient to implement the activities planned to be financed from the NTF.

3.4.2 Implementation Schedule and Supervision. The implementation of activities financed

from the NTF loan will run from April 2019 to the deadline for the last disbursement of the

additional loan which will be set for 31 December 2023, the same date as for the initial Bank Group

loans (ADF and TSF agreements). Therefore, approval of the additional funding will not delay the

completion of activities by 2023. Upon approval of the NTF additional loan, the Bank will undertake

supervision missions every 6 months, concurrently with those provided for under the initial project

financing agreements, in accordance with the Bank's Operations Manual.

3.4.3 Procurement for Additional Activities Financed from the NTF Loan: The

procurement of goods (including non-consultancy services), works and consultancy services,

financed by the NTF as part of the project, will be carried out in accordance with the Procurement

Framework for Bank Group-Funded Operations, October 2015 edition, and the provisions set

out in the Financing Agreement. More specifically, procurements will be carried out as follows: The

mission has defined the procurement to be carried out according to the Bank's procurement methods

and procedures and those to be for which the Borrower's Procurement System. Regarding the latter,

a waiver will be requested from the Bank’s Board of Directors so that the Rules of Origin of the

ADB Window (applicable to NTF resources) may be aligned, for the circumstance, with the Rules

of Origin governing public contracts under Togolese law, and applicable to the NTF-financed

contracts that will be concluded using the national system. Also, the Procurement Plan for activities

covered by the additional financing was prepared by the national party and approved by the Bank

(see Annex IV).

7

3.4.4 Financial Management. The management system provided for in the initial project for

the financial management of APRODAT is the same as the one that will be used to implement the

NTF loan, as outlined in the project appraisal report (PAR) of the initial project (see Annex B4).

The measures that were planned in the initial project and have already been implemented are:

completion of the organization chart and recruitment of key personnel (coordinator, administrative

and financial officer, accountants, internal auditor, etc.). The processes currently being implemented

by APRODAT include (i) the recruitment of the consultant in charge of preparing the administrative,

financial and accounting procedures manual; (ii) the ongoing selection of an integrated multi-project

and multi-user management system provider to ensure the keeping of budgetary, analytical and

general budget accounts; and (iii) the ongoing recruitment of independent external auditors on a

competitive basis. Specific needs related to the additional financing from the Nigeria Trust Fund

will now have to be incorporated into these procedures manuals, management systems and software.

3.4.5 Disbursements. The resources of the NTF Loan will be mobilized in accordance with the

rules and procedures of the Bank’s Disbursement Handbook through the following two

disbursement methods: (i) direct payment (for the procurement of works, goods and services and

other relatively high-cost expenditure...); (ii) reimbursement, where appropriate with the Bank’s

prior approval. The special account method was not chosen because the operating expenses are

entirely covered by the other funds of the initial project.

3.4.6 Sustainability. The project is part of a sustainable development effort and its sustainability

is based on the fact that most of the activities to be financed were identified in collaboration with

stakeholders. The technical assistance provided for in the initial project will build the capacity of

national and regional institutions to clarify and better assume their responsibilities in terms of the

sustainable management of rural infrastructure. The initial project already comprises operations

such as capacity building in entrepreneurial culture, farmer organizational dynamics and the

empowerment of communities through the Irrigation Water Users’ Association (AUSI) in the

management/maintenance of infrastructure (including irrigated areas), which guarantees the

sustainability of project outcomes and impacts. Also, national provisions will be implemented for

the operation and maintenance of the planned DWS systems funded from the NTF loan, as follows:

In rural areas, boreholes equipped with manually operated pumps will be managed at the village level by works management committees, while mini water supply

systems will be managed by the Drinking Water and Sanitation Users’ Association

(AUSEPA). The establishment of these bodies is a prerequisite for benefiting from

the water point.

These Committees and AUSEPA will be controlled by the Regional Directorate of Water and Village Water Supply (DREHV), whose personnel includes support

staff (training agents, 1 sociologist, and 1 mechanic in charge of training local

repairmen);

Communities are also required to meet the following conditions:

‒ Mobilize CFAF 150,000 per borehole equipped with a manually operated pump and CFAF 200,000 per standpipe;

‒ Open an account with a microfinance institution into which this amount and - after the commissioning of the works - the proceeds of water sale are

deposited to ensure the security of resources; and

8

‒ Provide a certificate donation of the works right-of-way.

3.4.7 Potential Risks and Mitigation Measures. The potential risks are the same as those

identified in the initial project (see paragraph 4.5.1 of the PAR). The mitigation measures

proposed in the initial PAR remain valid for this additional NTF financing (see revised logical

framework in Annex II)

IV. COST OF THE ADDITIONAL LOAN AND REVISED FINANCING PLAN

4.1 Breakdown of the Cost of the NTF Additional Financing

4.1.1 The estimated cost, exclusive of taxes and customs duties, of the additional financing

provided by the Nigeria Trust Fund (NTF) stands at UA 4 million, of which UA 2.821 million

will be in foreign exchange (70.5% of the cost) and UA 1.179 million in local currency (29.5%

of the cost). These costs were established on the basis of the unit prices of similar contracts

recently executed, and include unallocated resources.

4.1.2 Breakdown by category of expenditure of the additional NTF financing. The breakdown

of the NTF loan of UA 4 million, exclusive of taxes and customs, by expenditure category is

presented in the table below:

LIST OF GOODS AND SERVICES NTF Loan (in UA million)

Local Currency Foreign Exchange Total

A. WORKS 1 111.45 2 593.38 3 704.83

Developments 671.55 1 566.94 2 238.49

Infrastructure 439.90 1 026.43 1 466.34

C. SERVICES 23.33 132.19 155.51

2. TECHNICAL ASSISTANCE 23.33 132.19 155.51

Unallocated 43.73 95.93 139.66

TOTAL 1 178.51 2 821.49 4 000.00

4.2 Revised Cumulative Financing Plan of the PTA-Togo (including NTF funding)

4.2.1 Financing Mechanism: The project financing comprises: (i) the initial financing for the

PTA-Togo Project namely, an ADF loan and grant, a TSF loan, funding from BOAD and the

Korean Fund, to the tune of UA 8.04 million (116.7%), UA 4.635 million (9.6%), including the PPF

refund of UA 995,000; UA 8.32 million (17.2%), CFAF 10 billion (UA 12.8 million or 26.5%),

USD 5.068 million (UA 3.52 million (UA 12.8 million or 26.5%), respectively, and the Togolese

Government to the tune of CFAF 6.046 billion; and (ii) the NTF additional financing, which is the

subject of this Note to the Board, to the tune of UA 4 million (6.6%). The breakdown of the revised

cumulative costs (including NTF funding), by source of funding, is as follows (see table).

Summary of project cost by source of financing (including the NTF funding)

SOURCES OF

FINANCING

(CFAF Million) (UA '000) %

L.C. F.E. Total L.C. F.E. Total

ADF Loan 1 887.43 4 391.41 6 278.83 2 416.84 5 623.16 8 040.00 16.4

TSF Loan 2 250.64 4 246.86 6 497.50 2 881.93 5 438.07 8 320.00 17.0

ADF Grant 2 374.41 1 245.30 3 619.70 3 040.41 1 594.59 4 635.00 9.4

BOAD 3 331.70 6 668.30 10 000.00 4 266.21 8 538.71 12 804.92 26.1

Korean Fund 2 122.27 629.95 2 752.22 2 717.55 806.64 3 524.19 7.2

NTF (new) 942.56 2 256.60 3 199.16 1 178.51 2 821.49 4 000.00 8.2

State of Togo 3 288.99 2 757.09 6 046.08 4 211.52 3 530.43 7 741.95 15.8

Total 16 198.00 22 195.51 38 393.51 20 712.97 28 353.09 49 066.06 100.0

9

4.2.2 The breakdown of the revised cumulative costs (including the NTF funding) by component

and sub-component is provided in the following table.

Summary of revised project costs by component (including the NTF funding)

COMPONENTS (CFAF Million) (UA ‘000 ) %

F.E.

%

CB. L.C. F.E. Total L.C. F.E. Total

A. SUPPORT POLICY, GOVERNANCE &

INST. CAPACITY BUILDING 2 379.97 1 457.20 3 837.17 3 047.53 1 865.94 4 913.47 38 11

improvement of ZTA operational framework 633.97 583.20 1 217.17 811.79 746.79 1 558.58 48 4

Establishment of ZTA governance system 488.00 672.00 1 160.00 624.88 860.49 1 485.37 58 3

Strengthening of State and non-State public

institutions 1 258.00 202.00 1 460.00 1 610.86 258.66 1 869.52 14 4

B. DEVT. OF PROCESSING AND ACCESS

INFR 7 762.79 16 771.49 24 534.28 9 923.67 21 436.13 31 359.80 68 67

Agro-park infrastructure 2 150.81 4 896.06 7 046.87 2 754.10 6 269.37 9 023.46 69 21

Infrast. for access to inputs agric services 1 279.64 2 975.84 4 255.48 1 638.57 3 810.54 5 449.11 70 13

Production support infrastructure /b 4 332.34 8 899.59 13 231.93 5 531.00 11 356.23 16 887.23 68 36

C. STAKEHOLDER CAPACITY BUILDING 2 785.56 1 885.18 4 670.74 3 556.04 2 387.84 5 943.88 30 10

Producers of key sectors 2 144.77 657.45 2 802.22 2 746.36 841.86 3 588.22 23 8

Rural communities 449.74 955.78 1 405.52 565.04 1 197.76 1 762.80 80 1

Central and decentralised services 191.05 271.95 463.00 244.64 348.23 592.87 59 1

D. PROJECT MANAGEMENT &

COORDINATION 2 797.70 1 244.84 4 042.55 3 582.44 1 594.01 5 176.45 31 12

TOTAL BASE COST 15 726.03 21 358.71 37 084.74 20 109.68 27 283.92 47 393.60 57 100

Physical contingencies 187.83 380.95 568.78 239.97 486.52 726.49 67 2

Financial contingencies 284.13 455.84 739.96 363.31 582.67 945.98 62 2

TOTAL PROJECT COST 16 198.00 22 195.51 38 393.51 20 712.97 28 353.09 49 066.06 58 104

4.2.3 The breakdown of the revised cumulative project costs (including NTF funding) by

category of expenditure is as follows:

Summary of revised project costs by expenditure category (including NTF funding)

EXPENDITURE CATEGORIES

(CFAF Million) (UA ‘000)

%

Dev.

%

C.B.

Local

Currency

Foreign

Exchange Total

Local

Currency

Foreign

Exchange Total

I. INVESTMENT COSTS 13 279.38 20 847.12 34 126.49 16 976.77 26 628.82 43 605.59 60 92

A. WORKS 7 059.13 16 471.30 23 530.43 9 012.35 21 028.81 30 041.16 70 60

Dams and development schemes 3 537.10 8 253.22 11 790.32 4 513.02 10 530.39 15 043.41 70 29

Infrastructure 3 312.03 7 728.08 11 040.11 4 230.42 9 870.98 14 101.40 70 29

Construction and rehabilitation 210.00 490.00 700.00 268.90 627.44 896.34 70 2

B. GOODS 431.97 867.38 1 299.35 553.14 1 110.67 1 663.81 67 4

Vehicles 57.00 171.00 228.00 72.99 218.96 291.95 75 1

Equipment. materials and inputs 374.97 696.38 1 071.35 480.15 891.71 1 371.86 65 3

Equipment 374.97 696.38 1 071.35 480.15 891.71 1 371,86 65 3

Agricultural materials a inputs - - - - - - -

Sub-Total

C. SERVICES 3 460.93 3 508.44 6 969.37 4 431.13 4 489.34 8 920.47 50 19

1. Training 1 149.52 766.35 1 915.87 1 471.95 981.30 2 453.25 40 5

2. Technical assistance 232.41 1 316.97 1 549.38 297.03 1 683.18 1 980.21 85 4

3. Studies 1 160.25 1 088.87 2 249.12 1 485.69 1 394.29 2 879.98 48 6

Various studies 641.70 784.30 1 426.00 821.69 1 004.29 1 825,98 55 4

Preparation advance 518.55 304.57 823.12 664.00 390.00 1 054,00 37 2

4. Contractual services 885.00 295.00 1 180.00 1 133.24 377.75 1 510.98 25 3

5. Audit 33.75 41.25 75.00 43.22 52.82 96.04 55 0

D. Miscellaneous 2 327.35 - 2 327.35 2 980.15 - 2 980.15 - 6

II. RECURRING COSTS 2 446.65 511.60 2 958.25 3 132.92 655.10 3 788.01 17 8

A. PERSONNEL 1 572.00 - 1 572.00 2 012.93 - 2 012.93 - 4

B. TRAVEL EXPENSES 407.43 - 407.43 521.70 - 521.70 - 1

C. MAINTENANCE. OPERATION &

REPAIRS 295.10 454.22 749.32 377.87 581.63 959.50 61 2

Vehicles 148.65 276.06 424.70 190.34 353.49 543.83 65 1

Equipment 145.40 177.72 323.12 186.19 227.57 413.76 55 1

Infrastructure 1.05 0.45 1.50 1.34 0.58 1.92 30 0

D. OVERHEAD EXPENSES 172.13 57.38 229.50 220.40 73.47 293.87 25 1

TOTAL BASE COST 15 726.03 21 358.71 37 084.74 20 109.68 27 283.92 47 393.60 57 100

Physical contingencies 187.83 380.95 568.78 239.97 486.52 726.49 67 2

Financial contingencies 284.13 455.84 739.96 363.31 582.67 945.98 62 2

TOTAL PROJECT COST 16 198.00 22 195.51 38 393.51 20 712.97 28 353.09 49 066.06 58 104

10

V. LEGAL FRAMEWORK OF THE NTF DDITIONAL FINANCING

5.1 Legal Instrument

5.1.1 The additional loan from the Nigeria Trust Fund (NTF), for the implementation of

activities deemed essential for the PTA-Togo concerns a total of UA 4 million. Thus, a Loan

Agreement will be signed between the Republic of Togo and the African Development Bank for the

mobilization of the said NTF loan.

5.2 Conditions Associated with Bank Involvement

5.2.1 The grant of the NTF loan will be subject to the following conditions:

5.2.2 Conditions precedent to effectiveness: The effectiveness of the NTF Loan Agreement will

be subject to the fulfilment by the Borrower, to the satisfaction of the Bank, of the conditions set

forth in Section 12.01 of the General Conditions Applicable to the African Development Fund Loan

Agreements and Guarantee Agreements (Non Sovereign Entities), as may be amended periodically.

5.2.3 Conditions precedent to first disbursement. The disbursement of the loan resources shall be subject to effectiveness of the NTF Loan Agreement.

5.2.4 Conditions precedent to disbursements relating to works involving resettlement. Subject the effectiveness of the Loan Agreement, the disbursement of the loan resources by the Bank for

works involving resettlement shall be conditional on the fulfilment, by the Borrower, and to the

satisfaction of the Bank, of the following conditions:

(a) Submit a works and compensation schedule prepared in accordance with the Resettlement Plan (RP) and the Bank's Safeguard Policies satisfactory in substance

and form to the Bank detailing: (i) each project works area; and (ii) the timeframe

for compensation and/or resettlement of all project-affected persons (PAPs) for each

area; and

(b) Provide to the Bank satisfactory evidence that all project-affected persons (PAPs) in the works area have been compensated and/or relocated in accordance with the

Environmental and Social Management Plan (ESMP), Resettlement Plan (RP)

and/or the works and compensation schedule, as agreed and the Bank’s Safeguard

Policies, prior to the commencement of such works and in any event prior to

relocation of the PAPS and/or appropriation of their land and/or related assets; or

(c) In lieu of paragraph (b) above, provide satisfactory evidence that the resources allocated for the compensation and/or resettlement of the PAPs have been deposited

in a dedicated account in a bank acceptable to the Fund (or deposited with a trusted

third party acceptable to the Fund), where the Borrower can demonstrate, to the

satisfaction of the Bank, that the compensation and/or resettlement of the PAPs, in

accordance with paragraph (b) above, could not be achieved in whole or in part, for

the following reasons:

(i) the identification of PAPs by the Borrower is not feasible or possible;

(ii) there are ongoing disputes involving PAPs and/or affecting the compensation and/or resettlement exercise; or

(iii) any other reason beyond the Borrower’s control, as discussed and agreed with the Bank

11

5.2.5 Undertakings: The Borrower undertakes to comply with the project objectives. In this regard, the Borrower shall implement the project and ensure that its contractors and/or agents do

likewise, in accordance with the provisions of the provisions of the NTF Loan Agreement and

Article IX (Project Implementation - Cooperation and Information) of the General Conditions.

5.2.6 Environmental and Social Safeguards The Borrower shall undertake and ensure that the Executing Agency and each of its contractors, subcontractors and workers also undertake to:

(a) submit to the Bank prior to the start of works the reports of environmental and social studies (Environmental and Social Impact Assessment, Environmental and Social

Management Plan, Population Resettlement Action Plan and Pests and Pesticides

Management Plans) for the NTF-financed components of the project, validated by

the National Environmental Management Agency (ANGE)

(b) implement the Project in accordance with the ESMP, the Bank's Safeguard Policies and the applicable national legislation in a manner satisfactory to the Bank, in form

and substance

(c) Prepare and submit to the Bank, as part of the Project Report mentioned in the NTF Loan Agreement, quarterly reports on the implementation of the ESMP, including

identified shortcomings and corrective measures taken;

(d) Refrain from any action that would prevent or hinder the implementation of the ESMP, including any modification, suspension, waiver and/or cancellation of any

provision related thereto, in whole or in part, without the prior written consent of the

Bank; and

(e) Cooperate fully with the Bank in the event that the implementation of the Project or any change in its scope results in unforeseen displacement and/or resettlement of

populations; and undertake to commence works in the area affected by the

implementation of the Project only if all project-affected persons (PAPs) are

compensated and/or resettled in accordance with the Resettlement Plan (RP)

prepared.

5.2.7 Other conditions. The Borrower undertakes to:

(a) Submit to the Bank, no later than two (2) months after the effectiveness of Loan Agreement, for information purposes, the Administrative, Financial and Accounting

Procedures Manual of the Project, updated and taking into account the activities to

be financed from the Loan resources; and

(b) Incorporate the specific needs of the Loan into the integrated multi-project and multi-user management system to ensure the keeping of budgetary, analytical and general

budget accounts of the project.

5.2.8 Integrity: The Borrower shall implement the project and ensure that the Executing Agency and each of its contractors and/or agents implement it in accordance with the provisions of anti-corruption

policies.

12

5.3 Compliance with Bank Policies

5.3.1 The NTF addition financing will contribute to three of the Bank's High-Fives, namely: (i)

"Feed Africa"; (ii) "Industrialise Africa"; and (iii) "Improve the quality of life for the people of

Africa". It is also be consistent with the Bank's environmental and social management policies,

guidelines and procedures.

VI. RECOMMENDATION

Management recommends that the Board of Directors of the Bank approve: (i) the loan of additional

funding from the Nigeria Trust Fund (NTF) amounting to UA 4 million to the Republic of Togo for

the Togo Agro-Food Processing Project (PTA-Togo); and (ii) that procurements of goods, works

and services financed from the loan resources using the procurement procedures and methods of

Togo be open to non-Member States of the Bank.

ANNEXES

I

Annexe I: Letter from His Excellency the Minister of Finance of Nigeria, dated 31 August

2018, confirming the allocation of UA 4 million for the PTA-Togo

II

Annex II: Detailed Description of the Revised Project (including the NTF-funded

components)

The overall objective of the project is to promote inclusive agricultural growth that creates jobs and

reduces imports thanks to incentive measures for private investment in key areas (rice, maize, soybean, sesame, broiler meat and cashew nuts).

The specific objectives of the project are to: (i) facilitate private investments in key areas thanks to

policy support, governance and incentive measures; (ii) promote the development of priority value

chains through the establishment of infrastructure to support production, storage and processing;

and (iii) build the capacity of stakeholders in priority agro-industrial areas.

1. Description of the Components of the Initial Project

1.1 Project preparation was largely informed by the conduct of several PPF-funded studies,

including the following: (i) Studies on priority agricultural sectors, potential markets, and the

business environment; (ii) Study on the development of the agro-industrial park master plan; (iii)

design study of dams, irrigation schemes, DWS and electrification of 6 villages; (iv) detailed

designed study of electrification and access to the Agro-park ICT network. Thus, these studies

underpinned the design of this pilot project which is developed as the first Agro-food Processing

Zone (ZTA) in the Kara region and in the country. It includes measures to support political,

regulatory and institutional reforms with a view to attracting private investment, as well as measures

to improve rural infrastructure in the project area and build the capacities of stakeholders in priority

areas in terms of import substitution (rice, maize, soybean, broiler meat) and exports (cashew nuts

and sesame). Specifically, the project has a multidimensional approach:

1.2 At the institutional level, several measures in favour of private investment are planned

under the project, including:

Capacity building for the Agency for the Promotion and Development of Agropoles in Togo (APRODAT), established by Decree No. 2018-036/PR of 27

February 2018 to achieve the objective of implementing ten agropoles in the next 15

years (see paragraph 4)

Support for the future semi-public company for the promotion and management of the Kara Agro-Park, to promote private investment in agro-processing and input

supply. and agricultural services

Improvement of the regulatory and institutional framework for private investment in agribusiness, in particular through:

The operationalisation of land reform through technical assistance for the drafting of implementing decrees relating to agricultural and rural land law

voted by the National Assembly on 5 June 2018, including the establishment

of a single land tenure office;

Support to the Directorates and Agencies of the Ministry of Industry in charge of the implementation of ongoing reforms in standardization and metrology,

through provision of equipment (including laboratory equipment) and training;

Improvement of access to financing, particularly for SMEs and cooperatives, by setting up a guarantee fund with financial institutions and by providing ad

hoc support (IT equipment and training);

III

The study to be carried out by the TA firm for the development of the Agro-park business plan taking into account the targeted markets (national, regional

and international), the business environment, and possible desirable

incentives;

Measures to build the capacities of universities and other research, training and advisory support institutes operating in the agro-industrial sector (IT and

laboratory equipment, training, etc.)

1.3 At the physical level, the infrastructure development works planned under the project to

improve the private sector intervention environment will concern three major entities, namely:

A central portion or Agro-park composed of developed land with roads and sundry networks (drinking water supply, sanitation, electricity, ICT, etc.),

logistical support and specialized facilities and services (cold chain, laboratory

and certification, business services, waste treatment, single window, etc.); a joint

savings company will be responsible for promoting and managing the Agro-park,

where private companies invest in the processing of agricultural products and the

provision of services and inputs.

Agro-processing centres (CTAs), located in 10 village centres, are multipurpose platforms for use by agricultural operators comprising: (i) a collection, sorting and

primary storage centre; (ii) an input distribution centre; (iii) a service centre

(agricultural credit, business centre, farm equipment rental and maintenance, zoo-

sanitary clinic, etc.); (iv) a food quality control and seed certification service; (v)

an education and training centre for producers.

Agricultural production zones: They cover zones targeted to provide agricultural products to the Agro-park through the CTAs. They will benefit from public

investments (dams, irrigated areas, roads, etc.) that will help to boost agricultural

productivity for the selected areas. Thus, the NTF loan will finance the

development of 600 ha of irrigated areas downstream of the Agro-park dam (B1),

as well as the costs of the works supervision firm.

1.4 Concerning the strengthening of value chain actors to favour greater inclusion, the project

will support implementation of the following measures:

Support the establishment and capacity building of consultation frameworks of the main targeted sectors, to facilitate business relations with the private sector;

Enhance the capacities of the Agricultural Production Organisations (OPA) of the ten (10) Agricultural Processing Centres identified in the three agricultural zones

(irrigated, lowland and rain-fed) with the Saemaul Foundation for Globalization;

Improve the capacity of village communities in participatory diagnosis, participatory local planning, and the formulation and implementation of community projects

(Saemaul Foundation for Globalization). In this regard, the NTF will specifically

finance the construction of four mini-DWS networks for four village centres, the

drilling of 30 boreholes equipped with human-operated pumps, the rehabilitation of

eight boreholes, to meet the needs about 2 195 households, and 100 SMEs /producer

organizations (POs) involved in the processing of agricultural products (CTA) and

the provision of local services;

IV

Support capacity building of government services and other partners involved in the implementation of project activities;

Support the implementation of priority sub-projects in support of agricultural sectors identified by two CTAs (Saemaul Foundation for Globalization);

Support for the implementation of risk mitigation measures as identified in the Environmental and Social Strategic Assessment (SEA): compensation of

displaced/affected persons, compensation, protection of sensitive sites, etc.

1.5 The components, sub-components and activities of the project are presented in the

following table.

Components Cost CFAF M) Description of the Components

A/ Support policy,

governance and

incentive measures

4.98

A1/ Improvement of the policy, regulatory and operational framework

Technical assistance for the preparation of instruments for implementation of the Land Code (voted by the National Assembly on 5 June 2018), the

specifications of the Agro-park management company and

operationalisation of the single window

Support for the development of a legal, regulatory and operational framework for the Strategic Environmental and Social Assessment (SESA)

Support for the national departments responsible for quality, standards and metrology (facilities, training) at the Ministry of Industry

Technical assistance for the implementation of private investment promotion measures in the Agro-park (including instruments and

incentives), financial and management procedures and support for project

management (APRODAT)

Convening of an investment promotion forum for the ZTA (2)

A2/ Establishment of the ZTA governance system

Institutional support for APRODAT’s capacity building (staff, legal, technical and management assistance, training, etc.)

Support for the preparation of the specifications of the Agro-park management company, its recruitment (CAT) and monitoring of

performance quality

Feasibility study for two new ZTAs (OTI and Haut Mono regions)

A3/ Strengthening State and non-State public institutions

Support for non-financial institutions (computer and laboratory equipment and training): research institutes (Togo Institute for Agronomic Research

(ITRA)), consulting (Technical Advice and Support Institute (ICAT)),

training (CIDAP, INFA-Tové), Technical Advice and Support Institute

(ICAT), universities, etc.) and seed control/certification

Support for financial institutions: Establishment of a risk insurance fund, procurement of equipment (computer hardware and software), and capacity

building for banks and financial institutions (including in agribusiness)

V

Components Cost CFAF M) Description of the Components

B/ /

Infrastructure

for processing

and accessing

agricultural

inputs and

services

30.91

B1/ Agro-park development infrastructure (Broukou)

Architectural, detailed engineering design/bidding documents studies and supervision of construction work

Site development works & roads and sundry networks (roads, drinking water supply, sanitation, electricity, telecommunication, fencing, etc.);

drinking water supply station, water treatment, etc.

Construction of buildings: (i) administrative and residential block; (ii) services block (training centre, conference centre, laboratories, etc.); (iii)

socio-collective infrastructure block (school, health centre, hotel, etc.); (iv)

etc.

MV electricity supply (CEET) and fibre optic telecommunication work

Assistance for the establishment of a business incubator (provider)

B2/ Infrastructure for aggregation and access to agricultural inputs and services

Establishment of basic infrastructure for 10 CTAs located in 10 village centres covering the three agricultural production areas (irrigated, lowlands,

rain-fed), under the ADF:

- Technical studies and supervision of the construction of CTAs

- Construction works on 10 CTAs (harvest storage stores, input storage hangars, cooperative offices)

- Procurement of agricultural, cleaning and logistical equipment

Detailed design study of the main road (100 km) and secondary roads (50 km):

Work on the rehabilitation of roads (100 km) including ancillary structures

Control and supervision of rehabilitation works on the main road

B3/ Support infrastructure for agricultural production

Detailed engineering design/bidding documents studies for three mini-dams and irrigated areas (1 500 hectares)

Supervision of the construction of two mini-dams (Vol>15 Mm3)

Full technical and economic studies on the B9 dam with irrigated areas

Construction of two mini-dams for agricultural use (potential of 1,500 hectares) and industrial use (4,000 - 5,000 m3/day for the Agro-park);

Development of 600 ha of irrigated land downstream of agro-park dam No. 2, NTF

C/ Capacity

building for

actors in

priority

agricultural

sectors

4044

C1/ Capacity building for agricultural producers (with the Foundation)

Networking of sub-sectors (rice, maize, soybean, sesame, cashew nuts and broiler meat) and development of consultation frameworks (Foundation)

Building of the technical and management capacity of 10 CTAs of villages situated in the three agricultural zones (irrigated, lowlands, rain-fed) -

Foundation

Establishment of an information system for use by FOs (e-farmers, e-aggregation, e-inputs, e-services, etc., ADF)

Increased access to financing by FOs (guarantee fund)

Training and TA of state workers on the Saemaul Foundation approach

VI

Components Cost CFAF M) Description of the Components

C3 / Capacity building for village communities

Restoration of vegetation cover, protection of natural habitats around dams and hydro-agricultural structures AFD);

Manufacture of 5 000 improved stoves (fight against deforestation, ADF)

Facilitating access to vital civil status documents (approximately 50,000 people, including at least 70% women and young people, ADF)

Construction of 4 mini-DWS networks, 30 new boreholes equipped with

manually operated pumps, and rehabilitation of 8 boreholes (households and SMEs/producer organizations - OPs), for about 2,195 households, on

NTF resources

Support for the implementation of priority sub-projects for 2 CTAs: (i) acquisition and input management (see ITRA/OCP soil survey); (ii) input

procurement and management of equipment; (iii) crop storage and

management; (iv) agricultural services (Saemaul Foundation); etc.

C2/ Strengthening central and decentralised services

Training and technical assistance from State services (with ICAT) in the participatory, gender, nutrition and local development approach

Implementation of the safeguards included in the SESA: (i) Preparation of a resettlement policy framework; (ii) Preparation of a wastewater and solid

waste management blueprint; (iii) Preparation of an environmental best

practices manual; (iv) Implementation of the Environmental and Social

Impact Assessment Plan (ESMP) and pesticide management plan; (v)

Environmental and social baseline situation

Monitoring implementation of the Environmental and Social Management Plan ESMP (ANGE), RAP (ANGE) and PGPP (ANGE)

Procurement of motorcycles and computer equipment (agricultural regional administration)

D/Coordination

management,

monitoring and

evaluation

5.30 Steering and coordination

Procurement

Administrative, financial and accounting management

Monitoring and evaluation (M&E)

VII

Annex III: Revised Results-based Logical Framework of PTA-Togo (including the NTF-funded components)

NAME: Togo Agro-food Processing Project (PTA-Togo)

GOAL: Contribute to inclusive agricultural growth, which will create wealth and jobs, and to the reduction of food imports through increased private investment in priority value chains, including agricultural processing and

the supply of inputs and agricultural service.

RESULTS CHAIN PERFORMANCE INDICATORS MEANS OF

VERIFICATION

RISKS AND MITIGATION

MEASURES Indicators

(including SCI)

Baseline situation Target

IMP

AC

T

1. Contribute to reducing the volume of food imports per

capita

2. Contribute to reducing the poverty rate (especially in

rural areas)

1. Value of food imports in USD / per capita

2. % of population living below the poverty line

(less than USD 1.90/Day)

2.1 Increase in household food security levels

2.2 Decrease in % of children affected by

chronic malnutrition (including girls)

21.3 (2014)

49.1% (2015)

32.1% (Kara region)

16 (2030)

25% (2030)

28.9% (2025)

National Statistics,

Statistics of the United

Nations System

Demographic and Health

Survey 2013-2014

(Baseline situation)

OU

TC

OM

ES

1. The share of locally processed agricultural products has

increased

2. The living conditions of rural inhabitants of the project

area have improved

1.1 Share of agricultural production of the

project region processed in situ

1.2 Private investments catalysed in

agribusiness in the Kara region (USD

million)

2.1 Rate of household access to basic

social services in the project-affected

villages has improved: (i) Electricity;

(ii) all-weather roads (within 5 km));

(iii) drinking water for households

2.2 Number of direct and indirect jobs created /

enhanced (of which 50% are held by women)

2.3 Crop yields of crops t/ha: (i) Irrigated rice

(double-cropping); (ii) lowland rice; (iii)

rain-fed rice; (iv) Corn; (v) soybeans; (vi)

sesame; (vi) cashew nuts;

2.4 % of children aged 6-23 months with a

minimum acceptable diet

19%

0

(i) 16%; (ii) 11%;

(iii) 52%

0

(i) 2; (ii) 1.5; (iii) 1;

(iv) 1.2; (v) 0.5 ; (vi) 1; (vii) 0.5

10.5% (Kara region)

36%

>100

(i) 43%; (ii) 22%; (iii)

75%

39,000

(i) 10 ; (ii) 4; (iii) 2; (iv) 3; (v) 1; (vi) 1; (vii) 1

(i) 43% ; (ii) +10%

20%

Baseline Survey

and End-of-Project

Reports

National statistics

Demographic and Health

Survey in Togo 2013-

2014

Risk 1: Land security is not

enough to attract the private

sector and protect farmers

Mitigation 1: SESA has

identified mitigation measures,

including decrees to implement

the Land Code and

establishment of the Kara one-

stop-shop

Risk 2: Inadequate attention to

the needs of women and youth

Mitigation 2: The Foundation's

SESA (including RAP, ESIMP and PDC), and gender and

nutrition-sensitive participatory

approach will have positive

effects on the population

Risk 3: Climate change and

harmful population practices

could degrade natural resources

(NR)

Mitigation 3: Integrated NR

management and the

development of alternative

livelihoods should scale up the

project impacts.

VIII

OU

TP

UT

S

A / Support Policies, Governance and Incentives

1. Support to improve the institutional framework of the

ZTA

2. Establishment of the ZTA Governance System

3. Support to non-financial and financial institutions

B / Support infrast. for processing, production and

access to agricultural inputs and services

4. Implementation of Agro-Park development

infrastructure

5. Infrastructure for production aggregation and access

to agricultural inputs & services

6. Establishment of agricultural production support

infrastructure

C / Capacity building of sector actors

7. Capacity building of priority value chain POs

8. Capacity building for communities

9. Strengthening access to state services

D / Coordination, management and monitoring and

evaluation

Steering and Coordination, Procurement, Financial

Management

Audit, Monitoring and Evaluation

1.1 Land Code implementing regulations are

enacted

1.2 SSEA-related implementing legislation is

enacted

1.2 The national directorates of the Ministry of

Industry in charge of food quality are equipped

and trained

2.1 APRODA's capacities are built

2.2 The Agro-park management company is

operational

3.1 The capacity of training, advisory support

and certification structures is built

3.2 Percentage of partner FI portfolios invested

in agriculture: (i) Banks; (ii) MFIs

4.1 Area of the Agro-park and developed

(VRD+BC)

4.2 Annual capacity of Agro-park industrial units

(x1000): (i) Rice; (ii) Corn; (iii) Soybean; (iv)

Sesame; (v) Cashew nuts; (vi) Feed; (vii) Broiler

chicken; (viii) Chicks

5.1 No. of CTAs built and equipped

5.2 Total length of rehabilitated roads

6.1 Number of small dams built (capacity in m3)

6.2 Area covered by studies (i) FEED of

irrigation schemes; (ii) Lowlands developed (ha)

6.3 Irrigated area developed downstream of the

dams

7.1 No. of CTAs with capacity built

7.2 No. of key OPAs trained and supported

7.3 Number of farmers with access to services

provided by CTAs (inputs, harvest management,

e-farming, etc.)

8.1 Number of OPA support sub-projects

completed (2 CTAs)

8.2 Number of improved stoves installed

8.3 Number of civil status documents established

through the project

8.4 DWS (i) small networks (ii) boreholes and

HOPs; (iii) boreholes rehabilitated.

9.1 Capacity building of state services in

participatory approach, gender, health and

nutrition, etc.

0

0

0

0

0

0

(i) 0.3%; (ii) 10%)

0

(i) 0 ; (ii) 0 ; (iii) 0 ;

(iv) 0 ; (v) 0 ; (vi) 0 ;

(vii) 0 ; (viii) 0

0

0

0

0

0

0 ha

00

0

0

0

0

0

0

0

0

0

0

0

0

0

1

1

1

1

1

1

(i) 3% ; (ii) 15%

46 ha

(i) 90T; (ii) 15T; (iii)10T;

(iv) 10T; (v)10T; (vi)20T;

(vii) 2000; (viii) 3000

10

100 Km

2 (Vol. >15 M.m3)

(i) 1500 ha; (ii) 1500 ha

600 ha

10

50

10 000 (incl. 30%

women.) 10 000 (incl.

30% wom.)

6

5000

850 000

(i) 4; (ii)30; (iii) 8

1

(i))

1

1

1

5

10

Baseline and Project

Completion Surveys

Reports

Baseline data: year 2017

Project semi-annual

activity reports

Bank Supervision Reports

Risk: Lack of private sector

interest could limit investment in

the Agro-park

Mitigation: (i) Meetings have

been held with the private sector

(including the Kalyan Group, a

key investor), and their needs

taken into account;

(ii) The Project will finance

infrastructure for the

development of the Agro-park site and production areas; (ii)

support for the implementation

of PI reforms is planned (land,

standards and quality control,

PPPs, etc.); and (iii) Technical

assistance (legal, technical,

management, PPPs, etc.) will be

made available to APRODAT.

Risk 5: Project delays due to

APRODAT's lack of control

over the Bank's procedures)

Mitigation 5: Substantial institutional support (see action

plans) is planned for APRODAT

within the framework of the

project.

IX

9.2 Capacity building for SESA implementation

9.3 Monitoring of ESIA, ESMP, RAP and PGPP

(ANGE)

Financial management /accounting/procurement

procedures and systems prepared and

implemented

Number of PM Plans submitted on time and

approved

Annual audit report submitted on time

Number of semi-annual progress reports

submitted on time Project baseline and completion surveys

conducted

1

2

KE

Y

AC

TIV

IT

IES

Components: (1) Support Policies, Governance and

Incentives; (2) Support Infrastructure for Processing,

Production and Access to Agricultural Inputs and Services

(3) Capacity Building for Agro-industrial Sector Actors; (4)

Coordination, Management and Monitoring and Evaluation

Resources by component: (1) Component A: UA

4.983 million (11%); (2) Component B: UA 30.339

million (67%); (3) Component C: UA 4.440 million

(10%); (4) Component D: UA 5.304 million (12%)

Sources of funding: (i) ADF loan: UA 8.04 million, ADF Grant (with PPF): UA 4.635 million; (ii) TSF: UA 8.32

million; (iii) BOAD: UA 12.80 million; (iv) Saemaul Foundation: UA 3.52 million; (v) State: UA 7.74 million; (vi)

NTF: UA 4million.

X

Annex IV: Provisional Revised Project Implementation Schedule Year 2018 2019 2020 2021 2022 2023

Quarter 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4

Preparatory activities

Project appraisal

Loan, grant negotiations and approval

Signing of loan/grant agreements and compliance with conditions precedent to first disbursement

Publication of General Procurement Notice

Finalisation of selection of key staff and project launch

A / Support policies, governance and incentives

Recruitment of the technical assistance firm at APRODAT and delivery of services: preparation of procedures manual,

legal instruments, specifications of the management company, Assistant to the Contracting Authority (ACA), training, etc.

Procurement of equipment and capacity building for: APRODAT, Quality Directorates in charge of quality (Min.industry),

Agricultural Technical Services, Agro-Park Management Company, etc.

Recruitment of firms and feasibility study for two new ZTAs (OTI and Haut Mono)

Selection of and capacity building for non-financial and financial institutions (equipment and training): guarantee funds,

IT equipment and agribusiness-oriented training

II/ Support infrastructure for processing, production and facilitating access to agricultural inputs and services

(i) Architectural Studies and project design and bidding documents (APD/DCE) for the Agro-park; (ii) APD/DCE for

small dams and irrigated areas; (iii) complete studies on dam B9; (iv) Access roads and Agro-Processing Centres (10)

Development of the Agro-park including roads and sundry networks (drinking water, electricity, sanitation, roads, etc.),

DWSS, WTP and BC: selection of service providers and works implementation

Development works on irrigated areas (600 ha, NTF): selection of service providers and works implementation

Rehabilitation of access roads (national budget)and construction of 10 CTAs (ADF/TSF) selection of service providers

and works implementation

III/ Capacity building for actors in agricultural sectors

Capacity building for 10 CTA (sector structuring, technical and management training, support for input

procurement/management, agricultural services including e-farmers platform, etc.)

Support for the implementation of priority sub-projects in the key sectors of 2 pilot CTAs (Saemaul Globalization

Foundation)

Capacity building for rural communities: local planning, environmental management, nutrition manufacture of improved

stoves, civil status documents, etc.)

Capacity building for central and decentralise services (local development approach, action plans for protected areas and

pesticides, ESMP/RAP, missions and training, etc.)

IV/ Project coordination and management

Implementation of the financial, administrative and accounting management system

Establishment of the baseline situation and implementation of the monitoring and evaluation system

Coordination and management, monitoring and evaluation and communication

Technical assistance to APRODAT (procedures manual, engineering, legal matters, etc.)

Annual audit reports

Mid-term review

Completion report

XIV

Annex V: Procedures for Procurement from NTF Loan Resources

The activities of the Agro-Food Processing Project (PTA) to be financed by the NTF will be

implemented in the same environment as the initial project and by the same entities in charge of

activities financed from the ADF loan, the ADF grant and the TSF loan. Thus, the evaluations, risks

identified and action plans proposed under the project for activities financed from the resources of the

ADF loan, ADF grant and TSF loan shall be applicable to the NTF component of the project.

A) Details of Procurement Methods and Procedures (PMPs) to be used for activities funded from the NTF loan under the Project

Additional project procurements funded from the additional NTF Loan will be made according to

the following procurement systems and procedures:

1. Togo's Procurement System (PS)

Eligibility

The Bank's resources earmarked for financing the project's activities come from the ADB window

that provides NTF resources. Thus, the rules of origin specific to the ADB window are a priori

applicable. Following the assessment of the risks and procurement capacities, it was decided that

the National Procurement System could be used for part of this project. Given that the rules of

origin applicable to public contracts under Togolese law are not the same as those of the ADB

window, practical incompatibility should be avoided. In that regard, a waiver will be requested

from the Bank's Board of Directors so that the rules of origin of the ADB window (applicable

to NTF resources) may be aligned, on an ad hoc basis, with those laid down for public

contracts under Togolese law, and applied to the contracts that will be concluded according

to the national system and financed by the NTF. Thus, national eligibility rules will be

applicable to all contracts concluded under this project using the Togolese Government

Procurement System. However, if in using the national system the Borrower decides to award a

contract to an entity that is subject to Bank sanction or under sanction pursuant to Chapter VII of

the United Nations Charter, the resources of the Bank loans would not be used to finance such a

contract. The list of companies under sanctions is available at http://www.afdb.org/debarred.

Methods and Procedures

The following contracts will be awarded following the procurement system of Togo (PS), in

accordance with either Law No. 2009-013 of 30 June 2009 and Implementation Decree No. 2009-

277/PR of 11 November 2009 relating to the Public Procurement Code and several subsequent

decrees and implementing legislation, using standard national competitive bidding documents

(SNCBDs) or a request for quotation file (Section 16 of the Public Procurement Code and Articles

9, 10 and 12 of Decree No. 2011-059 of 4 May 2011 relating to thresholds for the award,

publication, control and approval of the public contracts):

Works

These contracts concern the construction of 30 boreholes, equipped with manually operated pumps (MOPs), and the rehabilitation of eight boreholes, for an estimated cost of UA

281 253. The works will be procured through open competitive bidding.

http://www.afdb.org/debarred

XV

2. Bank Procurement Methods and Procedures (BPM)

Eligibility

The eligibility rules applicable to NTF-financed procurements will be those described in paragraph

5 of the Bank's Procurement Policy Document.

Methods and Procedures

The following contracts will be awarded using the Bank’s procurement methods procedures, in

accordance with the "Procurement Policy and Methodology for Bank Group-Financed Operations",

dated October 2015, and the provisions set forth in the Financing Agreement, using the appropriate

standard solicitation documents (SSDs) of the Bank.

Works

These are contracts related to (i) the development of irrigated areas downstream of the agro-park dam (UA 2,313,614); and (ii) the construction of mini-drinking water supply networks,

including the boreholes to be drilled and equipped, broken up into four lots (UA 1,225,199).

The works will be procured through open competitive bidding (OCB) as described in

paragraphs 8.5 (a) and (c) of the Bank's Procurement Policy Document.

Consulting Services

They comprise the following services offered by consulting firms: (i) supervision of irrigated areas (UA 92,096); and (ii) monitoring and control of works relating to the drilling of

boreholes and the construction of mini-DWS networks (UA 67,848). All these services will

be procured following a selection of consulting firms using the Quality- and Cost-Based

Selection (QCBS) methodology, as defined by paragraph 8.6 of the Bank's Procurement

Policy Document.

The summary table of procurement procedures for NTF-funded components of the project is as

follows:

Table 1: Summary of procurement procedures

1. WO RKS

1.1. Construction of thirty (30) boreholes equipped with HMPs

and rehabilitation of eight (8) boreholes 0,281 [0,281] 0,281 [0,281]

1.2 Development works on irrigated areas downstream of the

agro-park dam 2,314 [2,314] 2,314 [2,314]

1.3. Work to build mini DWS networks including boreholes to

be constructed and equipped in four lots 1,245 [1,245] 1,245 [1,221]

Total Works 3,840 [3,840]

2.CO NSULTANCY SERVICES

2.1. CO NSULTING FIRMS

2.1.1. RecruItment of a consulting firm for monitoring of

works on irrigated areas 0,092 [0,092] 0,092 [0,090]

2.1.2. Recruitment of a consulting firm in charge of the

supervision and control of boreholes and mini-DWS

construction works

0,068 [0,068] 0,068 [0,068]

Total

Consulting firms0,160 [0,160]

Total 4,000 [4,000]

Total

Expenditure Categories

UA Million

National procurement methods and

procedures

Bank's procurement methods and procedures

O CB RFQ O thers O CB Shortlisting O thers

XVI

B/ Review of contracts awarded by the Borrower

(a) Control relating to the use of the Borrower’s procurement system (PS)

The use of the country's procurement system for procurement purposes will be subject to control and

regulation, in accordance with the laws and regulations of the country. Audits will be conducted by

the Public Procurement Regulatory Authority or by any other institution set up by the State. In

addition, the audit of procurements planned for the TSF and ADF components of the project will be

extended to the NTF component of the project

(b) Control relating to the Bank's procurement system

Procurements made in accordance with the Bank's methods and procedures will be subject to prior

or ex-post review by the Bank as follows:

No. Procurement method Prior review thresholds

(in UA))

Ex-post review

thresholds (in UA)

Frequency of reviews

1. Open competitive

bidding

Equal to or greater than

UA 1,200,000

All contracts

Less than

UA 1 200 000

The initial contract

2. Direct agreement All contracts

Prior review thresholds (consulting services): Decisions on procurements subject to the Bank's

prior review:

Selection method Review thresholds

(in UA))

Ex-post review

thresholds (in UA)

Frequency of

reviews

1. Competitive selection (Firm) Equal to or greater

than UA 200,000

All contracts

2. Competitive selection

(Individual)

Equal to or greater

than UA 100,000