Document of

The World Bank

Report No: ICR2062

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(TF-95035)

ON A GRANT

UNDER THE GLOBAL FOOD CRISIS RESPONSE PROGRAM

FOOD PRICE CRISIS RESPONSE CORE MULTI-DONOR TRUST FUND

IN THE AMOUNT OF US$7 MILLION

TO THE

GRM INTERNATIONAL LIMITED

FOR A

ZIMBABWE EMERGENCY AGRICULTURAL INPUT PROJECT

March 30, 2012

Agriculture and Rural Development

Sustainable Development Department

Country Department AFCS3

Africa Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective March 26, 2012)

Currency Unit = Zimbabwe Dollar (ZWD)

US$ 1.00 = 250,000 ZWD

FISCAL YEAR

January 1 – December 31

ABBREVIATIONS AND ACRONYMS

A-MDTF Analytic Multi-Donor Trust Fund

ASTRG Agrarian Sector Technical Review Group

BMZ Federal Ministry of Economic Cooperation and Development

(Germany)

CIDA Canadian International Development Agency

CIMMYT International Maize and Wheat Improvement Center

DANIDA Danish International Development Agency

DfID Department for International Development (United Kingdom)

DSS Department of Seed Services (Ministry of Agriculture)

EPP Emergency Project Paper

EU European Union

FAO Food and Agriculture Organization of the United Nations

FPCR Food Price Crisis Response

GDP Gross Domestic Product

GFRP Global Food Crisis Response Program

HIV/AIDS Human Immunodeficiency Virus/Acquired Immune Deficiency

Syndrome

IBRD International Bank for Reconstruction and Development

ICR Implementation Completion and Results Report

ICRISAT International Crops Research Institute for the Semi-Arid Tropics

IDA International Development Agency

ISR Implementation Status and Results

KPI Key Performance Indicator

MDTF Multi-Donor Trust Fund

MoAMID Ministry of Agriculture, Mechanization and Irrigation Development

MoF Ministry of Finance

Mt Metric tons

NGO Non-Governmental Organization

NORAD Norwegian Agency for International Development

O&M Operation and Maintenance

OPV Open Pollinated Variety (maize seed)

PAD Project Appraisal Document

PRP Protracted Relief Program

QAG Quality Assurance Group

RFP Request for Proposal

iii

SADC Southern Africa Development Community

SPF State and Peace Building Fund

STERP Short Term Economic Recovery Program

TOR Terms of Reference

USAID United States Agency for International Development

WFP World Food Program

ZAIP Zimbabwe Agricultural Input Project

ZEAIP Zimbabwe Emergency Agricultural Input Project

Vice President: Obiageli Katryn Ezekwesili

Country Director: Kundhavi Kadiresan

Sector Manager: Karen Mcconnell Brooks

Project Team Leader: David Rohrbach

ICR Team Leader: Pauline McPherson

iv

REPUBLIC OF ZIMBABWE

Emergency Agricultural Input Project

CONTENTS

Data Sheet

A. Basic Information

B. Key Dates

C. Ratings Summary

D. Sector and Theme Codes

E. Bank Staff

F. Results Framework Analysis

G. Ratings of Project Performance in ISRs

H. Restructuring

I. Disbursement Graph

1. Project Context, Development Objectives and Design ............................................. 1 2. Key Factors Affecting Implementation and Outcomes ............................................ 5

3. Assessment of Outcomes ........................................................................................ 11 4. Assessment of Risk to Development Outcome ....................................................... 16 5. Assessment of Bank and Borrower Performance ................................................... 16

6. Lessons Learned...................................................................................................... 18

7. Comments on Issues Raised by Grantee/Implementing Agencies/Donors............. 20 Annex 1. Project Costs and Financing ........................................................................ 21 Annex 2. Outputs by Component................................................................................ 22

Annex 3. Economic and Financial Analysis ............................................................... 24 Annex 4. Grant Preparation and Implementation Support/Supervision Processes ..... 27

Annex 5. Beneficiary Survey Results ......................................................................... 28 Annex 6. Stakeholder Workshop Report and Results ................................................. 29 Annex 7. Summary of Grantee's ICR and/or Comments on Draft ICR ...................... 38 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ..................... 41 Annex 9. List of Supporting Documents .................................................................... 42

MAP ............................................................................................................................ 44

v

A. Basic Information

Country: Zimbabwe Project Name:

Zimbabwe Emergency

Agricultural Input

Project

Project ID: P117212 L/C/TF Number(s): TF-95035

ICR Date: 03/30/2012 ICR Type: Core ICR

Lending Instrument: SIL Grantee: GRM

Original Total

Commitment: US$7.00M Disbursed Amount: US$7.00M

Revised Amount: US$7.00M

Environmental Category: C

Implementing Agencies:

GRM International Limited

Cofinanciers and Other External Partners:

B. Key Dates

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 06/25/2009 Effectiveness: 09/03/2009 09/03/2009

Appraisal: 07/02/2009 Restructuring(s): 10/01/2010

Approval: 08/12/2009 Mid-term Review:

Closing: 06/30/2011 09/30/2011

C. Ratings Summary

C.1 Performance Rating by ICR

Outcomes: Satisfactory

Risk to Development Outcome: Low or Negligible

Bank Performance: Highly Satisfactory

Grantee Performance: Satisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Bank Ratings Borrower Ratings

Quality at Entry: Highly Satisfactory Government: Satisfactory

Quality of Supervision: Highly Satisfactory Implementing

Agency/Agencies: Satisfactory

Overall Bank

Performance: Highly Satisfactory

Overall Borrower

Performance: Satisfactory

vi

C.3 Quality at Entry and Implementation Performance Indicators

Implementation

Performance Indicators

QAG Assessments

(if any) Rating

Potential Problem Project

at any time (Yes/No): No

Quality at Entry

(QEA): None

Problem Project at any

time (Yes/No): No

Quality of

Supervision (QSA): None

DO rating before

Closing/Inactive status: Satisfactory

D. Sector and Theme Codes

Original Actual

Sector Code (as % of total Bank financing)

Crops 100 100

Theme Code (as % of total Bank financing)

Global food crisis response 100 100

E. Bank Staff

Positions At ICR At Approval

Vice President: Obiageli Katryn Ezekwesili Obiageli Katryn Ezekwesili

Country Director: Kundhavi Kadiresan Peter Nicholas (Acting CD)

Sector Manager: Karen Mcconnell Brooks Karen Mcconnell Brooks

Project Team Leader: David Rohrbach David Rohrbach

ICR Team Leader: Pauline McPherson

ICR Primary Author: Pauline McPherson

F. Results Framework Analysis

Project Development Objectives (from Project Appraisal Document) The objective of the project is to increase access to improved seed among 300,000

smallholder farmers farming in targeted food-insecure communal lands of Zimbabwe.

Revised Project Development Objectives (as approved by original approving authority) PDO was not revised

vii

(a) PDO Indicator(s)

Indicator Baseline Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target

Values

Actual Value

Achieved at

Completion or

Target Years*

Indicator 1 : Producers receiving improved seeds

Value quantitative or Qualitative)

0.00 (number) 300,000 (number) 345,000

(number) 365,593 (number)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target indicator was exceeded by 22 % over original target or 6% over revised

target

Indicator 2 : Area cultivated with improved seeds

Value quantitative or Qualitative)

0 (ha) 135,000 (ha) 155,250 (ha) 163,133 (ha)

Date achieved 07/30/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target indicator was exceeded by 21% over original target or 5% over revised

target

(b) Intermediate Outcome Indicator(s)

Indicator Baseline Value

Original Target

Values (from

approval

documents)

Formally

Revised

Target Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 1 : Seeds procured and distributed to farmers

Value (quantitative or Qualitative)

0 (metric ton) 3,000 (metric ton) 3,450 (metric

ton) 3,630 (metric ton)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Performance indicator exceeded by 21% over original target or 5% over revised

target

Indicator 2 : Proportion of seeds distributed planted

Value (quantitative or Qualitative)

0 (%) 90 (%) 90 (%) 90 (%)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target was fully achieved

Indicator 3 : Proportion of seeds distributed to farmers before the end of November

Value (quantitative or Qualitative)

0 (%) 90 (%) 90 (%) 94 (%)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

viii

Comments (incl. % achievement)

Target was exceed by 4% (GRM records)

Indicator 4 : Farmers receiving vouchers

Value (quantitative or Qualitative)

0.00 (number) 25,000 (number) 70,000

(number) 86,193 (number)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target indicator was exceeded by 245% over original target or 23% over revised

target

Indicator 5 : Proportion of vouchers redeemed by farmers in exchange for seeds within 4

weeks of receipt

Value (quantitative or Qualitative)

0 (%) 90 (%) 90 (%) 97 (%)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target indicator was exceeded by 8%

Indicator 6 : Proportion of vouchers paid out by GRM within 3 weeks of receipt

Value (quantitative or Qualitative)

0 (%) 90 (%) 90 (%) 66 (%)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target not achieved due to delays in payouts resulting from late return of

vouchers for reimbursement from seed company

Indicator 7 : Percent of project reports submitted on time

Value (quantitative or Qualitative)

0 (%) 100 (%) 100 (%) 100 (%)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Target was fully achieved

Indicator 8 : Project rated satisfactory during each supervision mission

Value (quantitative or Qualitative)

Yes Yes Yes

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

First mission rated moderately satisfactory; second mission rated satisfactory;

third mission rated highly satisfactory

Indicator 9 : Direct project beneficiaries

Value (quantitative or Qualitative)

0.00 (number) 300,000 (number) 345,000

(number) 365,593 (number)

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments Core indicator added after project was approved; Target indicator was exceeded

ix

(incl. % achievement)

by 22 % over original target or 6% over revised target

Indicator 10 : Female beneficiaries

Value (quantitative or Qualitative)

33 (%)

Date achieved 09/30/2011

Comments (incl. % achievement)

Core indicator added after project was approved; no target set earlier

Indicator 11 : Percent of procurement completed within one month of plan

Value (quantitative or Qualitative)

0 (%) 100 (%) 100 (%) 0%

Date achieved 07/01/2009 06/30/2011 09/30/2011 09/30/2011

Comments (incl. % achievement)

Procurement was delayed as implementing agency learned the Bank's

procurement requirements. However, marginal delays did not affect project

implementation *The closing ISR values for the two PDO indicators and the intermediate indicators on the proportion of

seed planted and number of farmers receiving vouchers were drawn from a preliminary draft of the impact

assessment. These values were updated based on the final impact assessment data.

G. Ratings of Project Performance in ISRs

No. Date ISR Archived

DO IP Actual

Disbursements (US$ millions)

1 04/26/2010 Satisfactory Satisfactory 5.53

2 12/10/2010 Highly Satisfactory Highly Satisfactory 6.99

3 01/15/2011 Highly Satisfactory Satisfactory 6.99

4 07/10/2011 Satisfactory Satisfactory 7.00

H. Restructuring (if any)

Restructuring

Date(s)

Board

Approved

PDO Change

ISR Ratings at

Restructuring Amount

Disbursed at

Restructuring

in

US$ millions

Reason for Restructuring &

Key Changes Made DO IP

10/01/2010 S S 5.77

Budget savings from 2009 seed

purchase allowed for a 2nd year

of seed distribution. Additional

45,000 farmers targeted to

receive 10kg bag of improved

seed for 2010/11 crop season.

x

I. Disbursement Profile

1

1. Project Context, Development Objectives and Design

1.1 Context at Appraisal

1. Country context: At the time of project appraisal in 2009, Zimbabwe was in the

midst of political and economic instability. Hyper-inflation, devaluation of its currency,

negative growth, high unemployment and low agricultural productivity contributed to the

country‘s economic decline. Cumulative real Gross Domestic Product (GDP) was

estimated to have declined over 35 percent since 1999. Over 70 percent of the population

lived below the poverty level and many basic services had collapsed. Health outcomes

were particularly dominated by the decimating effects of HIV/AIDS on the population.

2. In mid-February 2009, a new coalition Government1 was formed with an

immediate mandate of arresting the country‘s deteriorating economy through major

policy reforms. The Short Term Economic Recovery Program (STERP) detailed

Government‘s strategic response for bringing hyper-inflation under control2, improving

economic growth, restoring basic services, and lifting price and trade controls which had

left a negative impact on many sectors, particularly agriculture. The STERP placed

revitalization of the agriculture sector, and in particular, improving food security, among

its top priorities3.

3. Sector context: Agriculture accounts for about 18 percent of GDP, and 70

percent of employment. Yet, agricultural production had been declining since the late

1990s, and was further worsened following implementation of the Fast Track Land

Redistribution program starting in 2000. Household food security declined precipitously,

especially in the rural areas. In 2008, Zimbabwe harvested less than 30 percent of cereal

grain requirements as a result of drought and a shortage of farm inputs. By 2009, upwards

of 7 million people or more than 60 percent of the country‘s population required food aid

due to high international grain prices and the inability of Government to find sufficient

resources to meet the demand.

4. There was no budget provision under STERP4 to fund agricultural inputs as

donors were expected to purchase and distribute inputs using Government or Non-

Government (NGO) channels. A number of donor partners stepped in and committed

investments to support humanitarian efforts under a larger relief program that was

coordinated by the FAO Emergency Coordination Unit. This included DfID through its

1 The Government of National Unity (Zimbabwe‘s coalition Government) was formed on February 13,

2009. 2 As part of the reform in 2009, the country legalized commercial transactions in multiple currencies

(United States Dollar; Botswana Pula; South African Rand) and the Zimbabwe dollar for the most part

disappeared. 3 Under STERP, agricultural inputs in the form of maize seed and fertilizer would be provided to 800,000

vulnerable and food-insecure farming households. Each farmer would receive 10 kg of maize seed, 50 kg

of Compound D basal fertilizer and 50 kg of ammonium nitrate top dress sufficient for 0.5 ha or about 1

acre of land. 4 There is no agreed figure on the funding gap.

2

Protracted Relief Program (PRP)5 which was co-financed by donors such as AUSAID,

the Netherlands, DANIDA and NORAD. Other donor partners included EU, CIDA,

USAID, BMZ and SADC.

5. Rationale for Bank involvement: Zimbabwe had just suffered a severe drought

in which farmers in some areas had lost most of their assets and as a result were unable to

plant the next season‘s crop. Many markets, including fertilizer and seed markets, had

collapsed as a result of hyperinflation. Zimbabwe was becoming increasingly dependent

on expensive food aid for a large portion of the rural population and the political and

economic situation was not conducive to normal channels of outside financial support.

Zimbabwe was in a non-accrual status, as it has been since 2000, and consequently

ineligible for International Bank for Reconstruction and Development (IBRD) and

International Development Agency (IDA) financing. Yet the emergency nature of the

food crisis, exacerbated by the country‘s lack of budgetary resources to finance expensive

food imports, provided the rationale for the Bank to support the STERP, along with other

donor partners, through grant financing allocated through the NGO community. At the

global level, the Bank was already responding to the food crisis through the establishment

of a multi-donor trust fund – Global Food Crisis Response Program (GFRP). Zimbabwe

was eligible for grant support under the GFRP as it satisfied the following criteria: (i)

country negatively impacted by the rising cost of food; and (ii) country with limited

financial resources to address the crisis. The Zimbabwe Emergency Agricultural Input

Project (ZEAIP) was formulated as the Bank‘s response to the crisis securing financing

from the Food Price Crisis Response (FPCR) Core Trust Fund under the GFRP.

6. Linkage to the CAS: ZEAIP is fully consistent with the Bank‘s strategy for

Zimbabwe. The project is aligned with the Interim Strategy Note (ISN; FY08-096) and

supports the broad objectives of collective dialogue with NGOs, particularly in the area

of service delivery, and with development partners, to ensure readiness for future

recovery programs. To ready itself for renewed country engagement, the Bank and donor

partners established the Analytic Multi-Donor Trust Fund (A-MDTF) in 2008 to deliver

on the objectives of the ISN. An agrarian window under the A-MDTF was opened to

support dialogue and analytical work in the areas of agricultural development strategy,

land reform and food security.

1.2 Original Project Development Objectives (PDO) and Key Indicators (as

approved)

7. As stated in the Emergency Project Paper (EPP), the objective of the project was

to increase access to improved seed among 300,000 smallholder farmers farming in

targeted food-insecure communal lands of Zimbabwe.

5 The DfID-led PRP was implemented during the periods: 2004-2007 (PRP I) and 2008-2013 (PRP II).

The objectives of PRP II are to reduce extreme poverty in Zimbabwe and to prevent destitution and protect

and promote the livelihoods of the poor and most vulnerable. PRP II is expected to benefit almost two

million people living in rural and urban areas: ZEAIP Completion Report July 2009-June 2011, Closing

Date September 30, 2011: GRM International; December 2011. 6 ISN FY08-09 runs from July 2007 to June 2009. A new ISN is currently under preparation.

3

8. Project outcome indicators were: (i) Producers receiving improved seeds7

(number); and (ii) Area cultivated with improved seeds (hectares). These performance

indicators were reflected in the Grant Agreement along with a set of intermediate

indicators measuring implementation performance. Table 2 presents the full list of

performance indicators.

1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and

reasons/justification

9. The PDO and key indicators were not revised.

1.4 Main Beneficiaries,

10. Original (as approved). Project beneficiaries consisted of 300,000 smallholder

farmers living on food-insecure Zimbabwe communal lands8 who had not produced

sufficient cereal grain during the 2008/09 summer cropping season to meet household

consumption needs9. Under the project, higher priority was given to: (i) women,

especially those heading households; (ii) households affected by HIV/AIDs or related

health problems; and (iii) households with high dependency ratios. Project beneficiaries

also had no or limited access to draught power. The targeted beneficiaries were spread

across 45 districts.

11. Revised. An additional 45,000 smallholder farmers were targeted as beneficiaries

during a second round of input distribution during the 2010/11 agricultural year.

Unanticipated budget savings of US$1.6 million from the 2009 maize seed purchase

made it possible to extend support to needy farmers for a second year. The beneficiary

profile, as elaborated above, did not change.

1.5 Original Components (as approved)

12. At appraisal stage, the project comprised 2 components:

Component 1: Provision of Improved Seed (US$6.1 million or 87 % of project costs).

The component‘s objective was to purchase and distribute 3,000 mt of improved maize

seed to 300,000 farmers residing in Zimbabwe‘s food-insecure Communal Lands. Each

farmer would receive a 10 kg bag of improved maize seed in time for the 2009/10

summer planting season. Distribution of seeds was carried out using two approaches as

reflected by the following sub-components: (i) direct distribution of maize seed:

approximately 2,750 mt of improved maize seed distributed to 275,000 food-insecure

smallholder farmers; and (ii) voucher-based seeds distribution: approximately 250 mt

of hybrid maize seed distributed to 25,000 smallholder farmers through local rural retail

7 Improved maize seed includes hybrid and Open Pollinated Varieties (OPVs).

8 Communal Land consists of Tribal Trust Land in terms of the Tribal Trust Land Act, 1979. See full

definition in Standard Conditions under Article 1 of Grant Agreement. Seed was not to be distributed in

Zimbabwe‘s newly resettled lands where land rights were being contested. 9 This would comprise farmers who produced less than 1 mt of grain for a family of 6: ZEAIP Post-Harvest

Report, ICRISAT; December 10, 2010.

4

outlets in exchange for vouchers. This market-based distribution approach was

implemented as a pilot program to help rebuild linkages between seed suppliers and local

retail shops.

Component 2: Project Coordination, Monitoring and Evaluation (US$0.9 million or

13 % of project costs): Under this component, the implementing entity was responsible

for all aspects of project management as reflected by the two sub-components: (i) project

coordination and monitoring of seed supply companies and NGOs to ensure timely

tendering and delivery of seeds to farmers; operation of the pilot seed voucher program

to ensure timely distribution of vouchers, stocking of seed in rural retail shops, voucher

redemption and commission payment; and safeguards compliance; and (ii) project

evaluation through an independent entity to carry out an impact assessment, as well as

an independent audit.

1.6 Revised Components (restructuring)

13. ZEAIP was restructured (Level 2/CD approved) on September 28, 2010 and the

Grant Agreement was subsequently amended. Significant budget savings (US$1.6

million) from the lower than expected 2009 seed procurement cost were used to finance a

second round of seed distribution for the 2010/11 season (see Table 1 below). Component

1 was revised to include the purchase and distribution of an additional 450 mt of

improved maize seed to benefit an additional 45,000 smallholder farmers using the

voucher program only. Following the lessons derived from the pilot retail voucher

program in year one, the entire distribution effort was implemented through retail

vouchers in year two. There were no substantive changes in the methods of purchase or

seed distribution. In addition, Component 1 was reduced by US$240,000 with a

corresponding increase under Component 2 to allow for a second year impact assessment

and final audit. Project restructuring included a 3 month extension of the original closing

date from June 30, 2011 to September 30, 2011 to carry out the additional activities. The

results framework was also amended to formally reflect the revised targets.

Table 1: Original versus Revised ZEAIP Budget

US$ millions

2009/10 season 2010/11 season

Components Original

Budget

% Actual

Costs

Savings

Realloca-

tion

Revised

Budget

%

Component 1: Provision

of Improved Seed

6.10 87 4.50 1.60 (0.24) 5.86 84

Component 2: Project

Coordination, Monitoring

and Evaluation

0.90 13 0.87 0.03 0.24 1.14 16

Totals 7.00 100 5.37 1.63 0.00 7.00 100

5

1.7 Other significant changes

14. There were no other significant changes to the project.

2. Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry

15. Bank Process: ZEAIP for US$7 million was processed under OP/BP 8.0 which

allows for flexible and accelerated procedures. An experienced Bank team prepared the

operation in roughly three months (June to August 2009) and followed required due

diligence procedures including GFRP approval in June 2009 followed by the AFR Rapid

Response Committee decision review. ZEAIP was approved by the AFR Vice President

on August 12, 2009 and the grant became effective on September 3, 2009.

16. Project design: ZEAIP‘s design was built on years of experience gained by

Government, donors and NGOs in implementing humanitarian seed distribution programs

in Zimbabwe. The project‘s success was influenced by the following lessons:

seed delivery and planting needs to be timely in order for farmers to benefit from

the summer season rains;

seeds must be certified in line with Zimbabwe‘s agriculture regulatory protocol to

ensure genetic and physical purity, and good germination;

seed distribution should form part of a coordinated approach among all

stakeholders (Government, donors, NGOs) so as to reduce overlapping support to

beneficiaries;

monitoring of seed companies is critical to ensure timely supply of inputs;

provision of complementary inputs such as fertilizers, top dressings, etc., can

contribute to increased seed productivity.

17. PDO: The Bank‘s intervention was straightforward. The PDO was focused as it

reflected the Bank‘s one-time commitment to Zimbabwe‘s national input supply program,

and was not envisaged to support a longer-term agriculture development agenda. The

project‘s two components complimented the focused PDO as its main thrusts would be

the timely delivery of seeds to poor rural farmers for planting thereby contributing to

increased cereal area planted and yields.

18. Preparation/Implementation start-up: GRM International Limited, a private

company registered in the United Kingdom and Wales had been competitively selected to

manage DfID‘s PRP in Zimbabwe for several years. The team‘s decision to use GRM10

as the lead implementing agency was to effectively capitalize on an already established

mechanism for managing donor-supported input programs on-the-ground. In addition,

GRM worked in close collaboration with FAO‘s Emergency Coordination Unit based in

10 GRM International Ltd. was procured by the Bank under single source selection (SSS) on the basis of the

firm‘s competitive selection under the PRP and its extensive experience implementing input distribution

programs in Zimbabwe.

6

Harare and had developed strong relationships with an extensive network of experienced

NGOs operating throughout Zimbabwe11

.

19. Under the PRP II framework, ZEAIP was able to ensure quick implementation

start-up since it was critical to identify beneficiary farm households and provide them

each with a 10 kg bag of improved maize seed in time for the summer planting rains

(November – December). In parallel, the same beneficiaries received complementary

fertilizer and legume seeds funded under the PRP II. In the second year of seed delivery,

a significant share of the top dressing fertilizer was provided by the Zimbabwe

Agricultural Inputs Project (ZAIP) under the Bank-administered State and Peace Building

Fund (SPF).

20. Risks and mitigation. A number of risks were identified during project

preparation. Among them was the risk of elite capture. GRM‘s unfamiliarity with the

Bank‘s fiduciary procedures was identified as a risk since it had no prior experience

implementing Bank-supported operations. Another identified risk was the effectiveness

of piloting a voucher-based distribution system which would depend on the good-will of

rural retailers to stock seed inputs (as well as other inputs from parallel programs) as

many of them were at the initial stages of re-establishing their trading operations and

some had limited experience and/or knowledge of agriculture products. Possible delays

in seed supply by contracted seed providers due to production or import delays were also

highlighted as a major risk. Risk mitigations included strong on-the-ground Bank

supervisory support especially provided to GRM; and training programs/workshops

provided by the seed companies to educate local retailers on inputs, stocking, record-

keeping, etc. Finally, full consultation with the Ministry of Finance (MoF) and Ministry

of Agriculture, Mechanization and Irrigation Development (MoAMID) which resulted in

their strong endorsement and support contributed to effective implementation of ZEAIP

given its alignment to the STERP.

2.2 Implementation

21. Overall, implementation of ZEAIP was carried out as planned. The operation

covered 45 districts under the first year and 14 districts (using the retail voucher program

only) under the second year. Forty-nine rural retail shops participated in the pilot

voucher program in year one (2009/10) and 139 in the second year (2010/11). Highlights

of implementation progress are outlined as follows:

11 These were NGOs that had worked extensively with GRM on previous humanitarian support programs.

GRM had previously undertaken capacity assessments of the NGOs which were shared with the Bank. The

Bank agreed to select the NGOs on the basis of SSS.

7

2009/10 season (original)

22. Provision was made under the project for retroactive financing of up to

US$60,000 to allow GRM and Crown Agents Zimbabwe12

, GRM‘s procurement agent, to

quickly float seed tenders in the interest of time. Sub-contracting of 17 experienced

NGOs was also initiated early to quickly select and register ZEAIP beneficiaries and

identify retail outlets13

. These arrangements ensured timely implementation although

some delays were experienced by the seed company in obtaining OPVs which had to be

imported from Malawi and Zambia.

23. Overall, 3,047 mt of improved seed were accessed by 307,632 beneficiaries14

in

time for the critical planting season thus exceeding the original targets by 25 percent.

Favorable seed prices contributed to an extra 46.7 mt of seed to be procured benefiting

additional farmers. The pilot voucher distribution program was considered a success as

most retailers expressed satisfaction with its implementation. By mid-December 2009,

Seed Co (the contracted seed supplier) presented the redeemed vouchers to GRM.

Following a reconciliation process, Seed Co. invoiced GRM prior to the end of December

2009 and payment to Seed Co. was made in January 2010 due to the holiday break. The

performance target of ―proportion of vouchers paid out by GRM within 3 weeks of

receipt‖ was not achieved although this did not adversely affect achievement of the PDO.

24. Required inspection of maize seed facilities and genetic seed sampling were

undertaken by the Department of Seed Services (DSS) of MoAMID and the International

Maize and Wheat Improvement Center (CIMMYT) respectively. The outcome of these

tests was deemed satisfactory in both cases. An independent impact assessment of the

2009/10 post-planting and post-harvest season and an evaluation of the pilot voucher

program were carried out by ICRISAT.

2010/11 season (restructured)

25. Pannar Seed Company won a seed supply tender and was contracted by GRM to

supply hybrid maize seed under the retail voucher distribution method given the success

of the pilot program during the previous year. Thirteen NGOs were contracted to

distribute vouchers to farmers for a 10 kg bag of improved maize seed. NGOs were also

responsible for monitoring voucher redemption by the farmers.

26. According to GRM‘s completion report, by November 30, 2010, NGOs reported

that 94 percent of farmers had redeemed their vouchers thus exceeding the project‘s 90

percent target. By the end of December 2010, most farmers (99.3 percent) had collected

their inputs and commenced planting. The independent household post-planting report

12 Crown Agents Zimbabwe was procured under single source selection (SSS) as they had an established

working relationship with GRM to carry out procurement activities under the PRP. Crown Agents handled

ZEAIP procurement of maize seed for the 2009/10 season only. However, they provided technical

assistance including several staff to GRM for the 2010/11 season. 13

Participating retail outlets had to be within reasonable walking distance for targeted beneficiaries. 14 ZEAIP Completion Report July 2009-June 2011; Closing Date September 30, 2011: GRM International;

December 2011.

8

similarly estimated that on average 85 percent of the farmers had received their seed by

end-November. This was slightly lower than the 90 percent target because a supplemental

purchase of 133 mt of additional seed required a later, supplementary printing of

additional vouchers. In total, 583 mt of improved maize seed was purchased and

delivered to 57,961 farmers exceeding the year two target of 450 mt and 45,000

smallholder farmers, respectively by 29.6 percent and 28.8 percent, respectively. Pannar

was slow to collect and reconcile all of the seed vouchers with GRM. This delayed the

final payout for this seed. As a result, the performance target of ―proportion of vouchers

paid out by GRM within 3 weeks of receipt‖ was not fully met although this did not

affect achievement of the PDO.

27. The DSS carried out similar inspection of seed facilities as required by Zimbabwe

law. Maize seed was also submitted to CIMMYT for a second round of genetic testing.

In both cases, there were no problems. A 2010/11 household post-planting assessment

and a retail voucher performance evaluation was also carried out by ICRISAT. Due to

the closure of the project, a similar post-harvest assessment was not prepared.

Challenges

28. A few challenges were noted during implementation, but overall did not

materially affect achievement of the project‘s development objectives:

Seed distribution/voucher printing delays: Delays in the supply of a small

quantity of OPV seed during the first season of distribution led to associated

delays in the delivery of seed to targeted beneficiaries. In the second season, a

second supplemental printing of vouchers required in conjunction with a

supplemental purchase of seed made possible by lower than expected prices, led

to late delivery of some vouchers to NGOs for distribution to beneficiary farmers.

Based on the independent post-planting survey, the small number of farmers who

received their seed later than planned kept the seed for planting the following

year15

. These farmers likely accessed their own or locally ―recycled‖ seed or

purchased seed from other sources (NGOs, other farmers, etc.).

Procurement delays: Early procurement delays slowed down some aspects of the

contracting process as both GRM and the local staff of Crown Agents were

unfamiliar with the Bank‘s procurement process. Nonetheless, these delays did

not affect the project adversely. Although the target of ―100 percent of

procurement completed within one month of the plan‖ was not attained, seed

inputs were received by the beneficiaries by the targeted deadline.

Adverse climatic conditions: A dry spell (lasting more than 20 days) affected

most of southern Zimbabwe16

during both years of ZEAIP implementation with

damaging effects on productivity and crop yield. As a result, some crops had to

be written off. Although there were lower yields in the southern region due to the

15 For the few farmers who had maize in stock, 42% of maize from ZEAIP and 33% from other sources

were still in stock because inputs were obtained late in the season: ZEAIP Household Post-Planting Report,

ICRISAT; June 1, 2011. 16

Areas affected included Matebeleland South, Masvingo and southern parts of Midlands and Manicaland

Provinces.

9

drought, this was offset by better yields in the higher rainfall regions in the north.

Despite the dry spells in the south, the 2009/10 post-harvest report indicated that

90 percent of ZEAIP seed was planted contributing to roughly 41 percent of

maize area sown among the targeted households. The post-harvest assessment for

the same season reported that hybrid ZEAIP seed contributed to higher yields

(1,747 kg/ha) compared to non-ZEAIP hybrid seed (1,252 kg/ha). See Table A2.2.

Similarly, the 2010/11 post-planting survey reported 90 percent utilization rate of

hybrid maize seed effectively contributing to 45 percent of maize area sown

among the targeted households (see Table A2.3).

Commission payment delays: Particularly during the 2010/11 season, commission

payments to a number of participating retail outlets were delayed17

. A

contributing factor was that a number of local establishments did not have

banking arrangements to facilitate timely payments of their commissions. In a

few extreme cases, retailers reported that they were forced to go to Harare to seek

their payments personally. While delayed commission payments to retailers were

an issue, it did not adversely affect achievement of the PDO.

2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization

29. M&E design: The key performance indicators were straightforward and

adequate to monitor project implementation and measure progress against the PDO in

order to assess: (i) efficiency of seed distribution; (ii) reach and efficiency of both direct

and voucher seed distribution programs; and (iii) overall quality of project

implementation at component level. Given the emergency nature of the project and the

short implementation period, originally one year, the indicators were appropriately

focused on the efficiency of the delivery of inputs rather than long term impacts.

30. M&E implementation: At the field level, project monitoring was carried out

primarily by the contracted NGOs as they were tasked with ensuring timely delivery of

the seed and vouchers, where applicable, to farmers. GRM also undertook field

monitoring visits and provided quarterly progress reports to the Bank documenting

implementation progress against the project‘s KPIs. These reports were deemed

satisfactory to the Bank. ICRISAT was contracted by GRM to conduct an independent

impact assessment for each agricultural season covered by the project. Surveys were

carried out by ICRISAT to assess ZEAIP‘s implementation, and impact on household

beneficiaries in a number of rural provinces and districts, using structured sampling

methods. Post-planting, post harvest and retail voucher performance assessments were

undertaken and assessed against KPIs.

31. M&E utilization: The Bank team also undertook regular implementation support

missions and progress against the KPIs indicators was discussed and documented in aide

memoires and Implementation Status and Results Reports (ISRs). The project was seen

to be performing well and no changes were made. Utilization of the M&E results

enabled the project to expand the voucher system after the first season.

17 ZEAIP Retailer Voucher Performance Report, ICRISAT; July 17, 2011, cited that 50% of surveyed

retailers (100 retailers) experienced difficulties in receiving commission payments from the seed supplier.

10

2.4 Safeguard and Fiduciary Compliance

32. Environmental Safeguards: ZEAIP was classified as a Category C operation at

appraisal. OP 4.09 Pest Management was triggered as treatments to the seeds (fungicides

and pesticides) prior to distribution to the farmers and/or retail outlets could be

considered hazardous. However, treatment of seed is a common practice as required

under Zimbabwe regulations (Zimbabwe Pesticide Act of 2006). No genetically

modified seed was procured under the project. A Pest Management Plan (PMP) was

prepared and risk mitigation included inspection of seed plant facilities to ensure safe

application, use and storage of seed treatment pesticides. This was confirmed during

supervision missions. Throughout project implementation, there were no safeguard issues

identified by the team.

33. Financial Management: During preparation, the project‘s overall financial

management risk was assessed as Moderate primarily because GRM had no prior

experience implementing Bank-supported projects and also given the unique nature of the

project‘s design (i.e., very limited Government involvement; wide stakeholder spread).

GRM already had in place an adequate accounting/financial system under PRP II. The

Bank‘s requirement for a legal representation letter and guarantee agreement with direct

payment on the large seed contracts made by the Bank helped to mitigate the project‘s

financial risks. Quarterly unaudited IFRs were submitted to the Bank within the required

period.

34. At project closure, 98.6 percent of the grant amount or US$6,905,439 was

disbursed and unused funds of US$94,561 from the project‘s designated account are to be

returned to the trust fund. An independent audit of the project for the period ended June

30, 2010 (2009/10 season) resulted in an unqualified opinion. The audit report for the

period ended September 30, 2011 (2010/11 season) also resulted in an unqualified

opinion. Based on the final aide memoire and ISR (June 2011), financial management

was rated as satisfactory.

35. Procurement: The project‘s procurement requirements were not complicated

given the simple design and objectives of the project. Procurement consisted mainly of

contracting 17 NGOs (2009/10 season) and 13 NGOs (2010/11 season), seed suppliers,

and firms to carry out the impact assessments and financial audit. Initial procurement

delays were encountered on the part of GRM with respect to compliance of terms of

references (TORs) and requests for proposal (RFP) formats in line with the Bank‘s

guidelines. Similarly Crown Agents experienced delays due to miscommunication of

seed supplier payment arrangements for direct distribution tenders. The Bank‘s team

provided considerable guidance to GRM and Crown Agents from the field as well as

during regular implementation support missions.

36. There were no major procurement issues other than the delays noted above during

implementation start-up. Based on the final aide memoire and archived ISR (June 2011),

procurement was rated as satisfactory.

37. Legal Covenants: Apart from the standard financial and implementation

covenants, several conditions of effectiveness formed part of the Grant Agreement such

as: (i) execution and delivery of the Guarantee Agreement between the Bank and GRM in

11

form and substance satisfactory to the Bank; (ii) execution and delivery of the

Representation Letter of the Recipient and Guarantor concerning its legal structure and

financial condition; and (iii) adoption of a chart of accounts acceptable to the Bank. A

letter from the Government of Zimbabwe confirmed its support to the project and

implementation arrangements prior to grant effectiveness.

2.5 Post-completion Operation/Next Phase

38. ZEAIP closed on September 30, 2011 with no follow-on operation under

consideration. As previously stated, the project was formulated as a short-term

commitment in support of Zimbabwe‘s national seeds input program under STERP in

response to the 2008 food crisis. Post assessment reports show that ZEAIP-targeted

smallholder farmers benefitted from an additional year of improved seed inputs instead of

one year, as originally designed. ZEAIP‘s project design did not call for reforms or

institutional capacity building. No significant operation and maintenance (O&M)

arrangements were established over the period of project implementation as an already

well-defined framework of food assistance was in place under the PRP II.

39. However, one of the project‘s innovations was to pilot linkages between rural

retail markets and agricultural seed suppliers through the voucher distribution approach.

A post-evaluation of this activity showed that while local retailers were able to increase

their stock of seed through participation in ZEAIP (i.e., commissions received) and

suppliers increased their knowledge of the rural retail demand for agricultural inputs,

sustaining these market linkages would require a multi-year intervention above and

beyond what ZEAIP was designed to achieve. Nonetheless, a main goal of this project

was to pilot the concept of a voucher scheme and this goal was achieved.

3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation

40. ZEAIP‘s development objective remains highly relevant to Zimbabwe‘s priorities

and the Bank‘s strategy. The project‘s design was in direct response to supporting

Government‘s efforts under its national strategic priority – STERP – to improve food

security for the most vulnerable farming households through emergency relief efforts.

The project‘s contribution to the Bank‘s strategy remains relevant through its

contribution to the strategic/thematic pillars of the ISN. One of the outputs under ZEAIP

was the fostering of agricultural input market linkages between seed suppliers and rural

retail outlets through the voucher redemption program as well as contributing to

increased donor harmonization efforts.

12

3.2 Achievement of Project Development Objectives

41. This objective was fully achieved: ZEAIP fully achieved its development

objectives based on the final assessment against its key outcome indicators:

42. Producers receiving improved seed: Overall, 3,630 mt of improved seed was

distributed in 10 kg packages to 365,593 farm households under both direct and retail

voucher-based programs compared to revised targets of 3,450 mt and 345,000

respectively. On average, 90 percent of farm households were able to effectively plant

the improved seed within the critical summer planting period thereby contributing to their

own food security. Although assessment reports revealed that in a few districts, NGOs

split seed bags into 5 kg packs to benefit more farmers or distributed 20 kg bags to a

small number of farmers practicing conservation agriculture, on average this did not

change the beneficiary profile or affect the PDO. The 2009/10 post-harvest impact

assessment report estimated that the proportion of households that had produced

sufficient grain to meet their household requirements18

increased from 30 percent in

2008/09 to 48 percent in 2009/10 based on its review sample. In addition, it was

estimated that ZEAIP maize seed contributed 118 to 377 days of additional cereal supply

from the 2010 harvest at the household level. Due to the closure of the project, no similar

impact assessment report was prepared following the 2010/11 season harvest.

43. Area cultivated with improved seed: Based on the 2009/10 post-harvest survey,

ZEAIP seed contributed roughly 41 percent of total maize area planted in the targeted

areas resulting in 137,050 ha of area sown19

based on a 90 percent utilization rate.

ZEAIP hybrid maize seed was found to have produced higher yields (1,747 kg/ha)

compared to non-ZEAIP hybrid seed (1,252 kg/ha) (see Table A2.2). It should also be

mentioned that parallel fertilizer input support from other donor programs (ZAIP and

PRP II) would have also contributed to increased cereal yields achieved under the project.

For the 2010/11 season, ZEAIP seed contributed to roughly 56 percent of total area

planted in targeted areas (see Table A2.3) resulting in 26,083 ha of area sown. Total

maize area planted using ZEAIP seed over the two years was estimated at 163,133 ha

which exceeded the revised performance target of 155,250 ha by 8 percent.

44. Farmers receiving vouchers: This intermediate indicator was included in the

Grant Agreement and hence is discussed here. Successful implementation of the piloted

voucher program, which was then exclusively used in the second round, resulted in

86,193 farmers receiving seed under the program. Compared to the revised target of

70,000 farmers, this indicator exceeded the overall target by 23 percent.

45. Table 2 below documents the progress made against each PDO and intermediate

outcome indicators. The project met or exceeded all of its project outcome and

intermediate indicators with the exception of two indicators.

18 Cereal grain requirement of 1 mt for a household of six: ZEAIP Post-Harvest Report, ICRISAT;

December 10, 2010. 19

3,046 mt at 90 percent utilization rate, using a 20 kg/ha seed planting rate.

13

Table 2: Progress of Key PDO and Intermediate Outcome Indicators

Key Indicators Unit 2009/10

Original

Targets

2010/11

Scale-up

Formally

Revised

Targets

Achieved

Over 2 yrs

Comments

Project Outcome Indicators

Producers receiving improved

seed

number 300,000 45,000 345,000 365,593 Revised target

exceeded by 5.9%

Area cultivated with

improved seed

ha 135,000 20,250 155,250 163,133 Revised target

exceeded by 5.0%

Intermediate indicators

Seeds procured and

distributed to farmers

mt 3,000 450 3,450 3,630 Revised target

exceeded by 5.2%

Proportion of seeds

distributed, planted

percent 90 - 90 90 Target achieved

Proportion of seeds

distributed to farmers before

the end of November

percent 90 - 90 94 Target exceeded by

4.4 %

Farmers receiving vouchers number 25,000 45,000 70,000 86,193 Revised target

exceeded by 23.1%

Proportion of vouchers

redeemed by farmers in

exchange for seeds within 4

weeks of receipt

percent 90 - 90 97 Target exceeded by

7.7 %

Proportion of vouchers paid

out by GRM within 3 weeks

of receipt

percent 90 - 90 66 Target not achieved

due to payout delays

resulting from late

return of vouchers

for reimbursement

from seed company

Percent of project reports

submitted on time

percent 100 - 100 100 Target achieved

Project rated satisfactory

during each supervision

mission

Yes/No - Yes/No Yes Target achieved

Percent of procurement

completed within one month

of plan

percent 100 - 100 0 Target not achieved

due to procurement

delays as

implementing

agency learned the

Bank's procurement

requirements.

However, marginal

delays did not affect

project

implementation

Direct project beneficiaries

(of which female)

Number

(percent)

300,000 45,000

345,000

(33)

365,593

(33)

Core indicator added

after project was

approved. Revised

target exceeded by

5.9%.

Female target met;

no target set earlier Source: ZEAIP Completion Report for July 2009-June 2011; Closing Date September 30, 2011: GRM International;

December 2011 and June 2011 ISR: World Bank.

14

3.3 Efficiency

46. The project implemented efficient approaches to address the food security gaps

and yielded incremental benefits for vulnerable households. The project‘s costs were

generally reasonable, given the unique conditions under which this project was

undertaken and given the need to use retail vouchers as a means to revive market linkages

for the distribution of agricultural inputs. An economic and financial analysis was not

carried out during appraisal as this was an emergency operation. In the absence of a

calculated net present value (NPV) or economic rate of return (ERR), this analysis relies

on cost-effectiveness criteria and estimates of measurable benefits relative to costs.

47. In terms of cost-effectiveness, the project‘s costs to deliver maize seeds to

smallholder farmers were very similar to the local retail price of US$22 – US$23 for a 10

kg bag of improved maize seed in rural outlets. Overall, for the first year (2009/10), the

total cost per beneficiary to undertake direct distribution of maize seeds was US$24.09,

inclusive of the costs of seeds, transport and distribution, NGO implementation costs, and

other associated costs. Voucher distribution of seeds was only slightly higher at

US$24.63 per beneficiary. For the second year (2010/11), the cost of voucher

distribution was US$27.31 per beneficiary.

48. The cost-effectiveness findings above are based on an analysis by ICRISAT20

.

ICRISAT examined component costs using four lenses: procurement of ZEAIP inputs;

implementation of ZEAIP by NGOs; management of ZEAIP by the implementing agency,

and beneficiary costs.

49. A benefit-cost analysis, an alternative to the cost-effectiveness measures of

project efficiency, cites a conservative benefit-cost ratio of approximately 1.7. This

finding is based on crude estimates of the incremental benefits to farmers from increased

maize production and increased yields compared to the total project cost of US$7 million.

The value of the increased maize production from this project is estimated at

approximately US$12 million, depending on the assumptions made in the analysis.

Further details of the benefit-cost analysis, including data sources and key assumptions,

are provided in Annex 3.

3.4 Justification of Overall Outcome Rating

50. Rating: Satisfactory. Given the high relevance of the PDO, satisfactory

implementation progress, overall attainment of project targets (with the exception of not

achieving the targets related to timely payout of retail vouchers and procurement not

completed within one month of plan) and the project‘s contribution to increased cereal

production provided by ZEAIP seed, an overall satisfactory rating is fully justified. This

performance was substantiated by independent impact assessments undertaken.

Improved maize seed successfully got into the hands of poor, food-insecure farmers who

expressed satisfaction for the operation on the whole.

20 ZEAIP Retailer Voucher Performance Report, ICRISAT; July 17, 2011.

15

3.5 Overarching Themes, Other Outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development

51. ZEAIP helped 365,593 smallholder farmers improve their household food

security by generating sufficient food to support their households. ZEAIP specifically

targeted households unable to produce enough grain to meet their family consumption

requirements. These were households who were cutting back on meals, and who were

dependent on expensive and often intermittent distributions of food aid costing over

US$500 per mt. The 10 kg of maize seed provided under ZEAIP helped most targeted

households to produce at least 100 kg21

of additional grain contributing directly to the

expansion of household food supplies. Scarce cash resources that did not need to be used

for grain purchases could be reallocated to meet other household needs such as school

fees, medical fees, etc. On the market side, rural retailers who participated in the voucher

distribution program reported that they mainly used their commission for restocking

inventory (primarily groceries) and for consumption purposes.

52. Gender was an important focus in project design and hence targeted beneficiaries

included female-headed households. The project established a female beneficiary target

of 33 percent. Although the impact assessment did not explicitly look at targeting,

including gender, in terms of lessons learned, survey results did confirm that on average,

33 percent of female-headed households22

were served by the project.

(b) Institutional Change/Strengthening

53. As discussed earlier, ZEAIP was designed as a short-term emergency operation

with no institutional development objective. However, the innovative use of retail outlets

(agro-dealers, small grocery stores) to pilot the voucher distribution program was an

attempt to help revitalize market linkages between seed companies and rural retailers.

The success of the 2009/10 pilot program influenced the design of a second year of input

distribution solely using the voucher distribution method. Overall, most ZEAIP

participating retailers expressed satisfaction with the voucher program as they felt that it

helped to strengthen their relationships with seed suppliers and also contributed to

improved knowledge and understanding of agricultural inputs. Despite the voucher

program‘s overall success, achievement of longer-term sustainability was not envisaged

in the two seasons undertaken by project. Nonetheless, the project example, and

associated discussions with key stakeholders contributed to the expanded use of voucher

based input distribution efforts by a range of development partners.

21 This production gain is estimated to be approximately one-third of the total yield gain derived from the

seed distributed under the ZEAIP and the fertilizer distributed under complementary PRP programs. The

remaining 2/3 of the productivity gain is attributed to the use of fertilizer. Larger production gains were

achieved by farmers expanding the area they were able to plant. 22 According to the ZEAIP Household Post Planting Report, ICRISAT; June 1, 2011, on average 33.25% of

beneficiaries were female-headed households.

16

(c) Other Unintended Outcomes and Impacts (positive or negative)

54. None.

3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops

55. The Task Team Leader (TTL) organized one major stakeholder workshop to

discuss alternative strategies for input distribution under humanitarian relief programs

under the auspices of the Agrarian Sector Technical Review Group (ASTRG). This

workshop highlighted several experiments with voucher based input distribution and

encouraged stakeholders (Government and NGOs) to continue to experiment with these

strategies (see Annex 6).

4. Assessment of Risk to Development Outcome

56. Rating: Low. Short-term results that were the goal of this project have already

been achieved.

5. Assessment of Bank and Borrower Performance

5.1 Bank Performance

(a) Bank Performance in Ensuring Quality at Entry

57. Rating: Highly Satisfactory. The Bank was engaged in dialogue on the impact of

the 2008 food crisis with Zimbabwe‘s donor community as early as September 2008.

However, the Bank was unable to support the 2008/09 season given insufficient lead time

and instead focused on the 2009/10 season. This project was prepared in very difficult

country circumstances given the political, economic and social context and the acute

appeal to provide food inputs to poor farmers within a narrow window of opportunity.

ZEAIP was prepared in roughly three months by a highly experienced Bank team who

followed the required due diligence procedures under OP/BP 8.0 including GFRP and

regional reviews. This was an unusual operation as the grantee and implementing agency

was the private sector (GRM International) and not the Government. The Bank team

worked extensively with the Legal department as well as with the Financial Management

and Procurement Units to ensure that compliance with the Bank‘s legal and fiduciary

requirements would be satisfactorily met by GRM. While there was no formal Quality

Assurance Group (QAG) review of the project at entry, the operation was not assessed at

any time as a problem project or a project at risk. Therefore, it is the conclusion of this

ICR review that the project‘s quality at entry was found to be highly satisfactory.

(b) Quality of Supervision

58. Rating: Highly Satisfactory. Five implementation support missions were carried

out by the Bank‘s team fielded from the Zimbabwe Country Office. Based on mission

aide memoires and ISRs filed, the Bank‘s implementation support mission team reviewed

progress against the project‘s objectives and performance indicators and fiduciary and

17

safeguard aspects. GRM‘s unfamiliarity with the Bank‘s procurement procedures led to

some delay in the issuance of no objections because of incomplete or incorrect paperwork.

But this improved over the course of project implementation. Under the Bank‘s strong

supervision effort, implementation bottlenecks were effectively resolved and the quality

of GRM‘s reporting improved to a level satisfactory to the Bank. Finally, the project was

rated satisfactory or higher following each supervision mission undertaken by the Bank.

(c) Justification of Rating for Overall Bank Performance

59. Rating: Highly Satisfactory. Based on the above justifications, the diverse

experience of the Bank team contributed to a well-designed and straightforward operation.

The Bank collaborated fully and in partnership with the multiple stakeholders involved in

the project. ZEAIP was successfully implemented, achieved its development objective

and exceeded all but two of its targets. ZEAIP was awarded a 2010 Africa Region‘s

Award for Excellence in the areas of design, teamwork and first year implementation

achievements.

5.2 Borrower Performance

(a) Government Performance

60. Rating: Satisfactory. This was an unusual operation as the Government was

neither the grant recipient nor key implementing agency, although it was fully committed

to the operation. However, MoMID local extension workers (Agritex) and DSS staff did

play a role in identifying targeted beneficiary farmers and carrying out regulated

safeguard activities. The MoF was kept fully abreast of implementation progress during

regular Bank supervision missions. Aide memoires and management letters were

officially issued to the Ministry of Finance.

(b) Implementing Agency or Agencies Performance

61. Rating: Satisfactory. GRM demonstrated satisfactory performance in

implementing ZEAIP given its experience implementing PRP II. GRM carried out all

aspects of project management including timely submission of quarterly progress reports

to the Bank, procurement, monitoring safeguard aspects and ensuring required impact

assessment and audits were contracted and completed. Although there were initial

procurement delays, GRM collaborated well with the Bank and NGO partners in

resolving implementation bottlenecks such as supplier delays, and quickly helping to

resolve issues related to commission payment delays to ZEAIP retailers.

(c) Justification of Rating for Overall Borrower Performance

62. Rating: Satisfactory: Overall, the performance of the Grantee and Government

was satisfactory as ZEAIP achieved it development objective and fully exceeded its

targets. Targeted smallholder farmers expressed satisfaction as beneficiaries of the

operation.

18

6. Lessons Learned

63. Using Existing Institutional Structures, Particularly the Private Sector,

Reduces Risk in OP 8.00 Operations. This project was prepared at short notice to meet

the needs of a fragile state facing a humanitarian disaster. The risks of the operation were

considerably reduced by building off the experience and institutional arrangements

already operational on the ground. This foundation was most obvious in the operations of

the PRP which had been involved in the distribution of agricultural inputs and related

humanitarian support for several years. The project then identified and made use of the

skills of GRM, a competitively selected lead institution under the PRP. GRM and the

PRP already had well established implementation links with many NGOs who were

already well known by local communities, and who had already been involved in the

identification of farm families in need. The combination of using these existing

institutions, OP 8.00 rules, timely support from a diverse project development team,

timely review and due diligence assistance from Bank lawyers, and retroactive financing

allowed the project to be signed and implementation started quickly at the beginning of

the 2009/10 agricultural season – when the assistance was most needed.

64. Emergency Operations can be Designed to Reestablish the Private Sector

Quickly and Move Away from Expensive Food Aid. The combination of drought and

economic dislocation associated with hyperinflation had created a dependence on free

handouts of food and inputs in Zimbabwe. The needs of smallholders were particularly

acute in 2009 as a result of the high global food and fuel prices. During project design

various constituencies argued for a simple humanitarian design encompassing direct

handouts of inputs to individual farmers. The project team argued that the recent change

in Government, and adoption of hard currencies to replace the Zimbabwe dollar, opened

opportunities for market development, and a path toward the reduction of handout

dependency. After some debate, the project was allowed to pilot a voucher based seed

distribution program during the 2009/10 planting season. The success of this effort

encouraged interest in testing a broader range of market based delivery systems for

agricultural and rural assistance – including open vouchers, electronic vouchers and

retailer credit. The combination of a willingness to take this risk, and close

implementation monitoring, fostered a broader commitment to a humanitarian plus

development model. This was reinforced by seminars on alternative delivery strategies

and discussions about alterative rural assistance models led by a wider range of

development partners.

65. Heavily Subsidized or Free Bulk Input Supply Programs can Destroy Private

Retail Markets and Vouchers are a Useful Tool to Reduce this Problem. To further

develop input markets, the project asked each of the seed companies winning a tender to

supply seed in exchange for vouchers, to also supply seed to the selected agro-dealers for

commercial sale on consignment. In both 2009/10 and in 2010/11 this effort largely

failed for three inter-related reasons. First, many farmers still expected to receive free or

cheap seed directly from one or another distribution program, or from Government.

Many asked why they should purchase seed if they still hoped to receive this as a handout.

Second, many farmers had become so accustomed to seed handouts that they did not

believe observers who argued these were no longer available. Community discussions

were held to discuss exit strategies, but most participants argued, even when the season

19

was known to be favorable, that their poverty still justified free assistance. Finally, the

seed companies faced an incentive to hold and earmark seed for bulk sales to NGO and

Government programs, rather than risk the pursuit of smaller sales on rural retail markets.

In effect, the transition from relief to commercial seed markets takes time and needs to be

consistent. The voucher system used on this project is a useful tool for making this

transition because the vouchers can be subsidized while still maintaining private sector

infrastructure supply systems and incentives. Vouchers also have the advantage that the

level of subsidy can be adjusted over time. The key lesson for future Bank emergency

operations is that NGO or Government bulk delivery input supply programs should only

be used as a last resort in emergency situations because they can reduce incentives for or

even destroy existing private delivery structures. The other lesson is that voucher

systems can avoid this problem if they are used in the first place or gradually repair the

damage if the bulk distribution of inputs has already been introduced.

66. The Competitive Procurement of Seed from One Supplier Limits Seed Choices

to the Farmer and can Dislocate Supply Markets. The ZEIAP procured seed from the

cheapest supplier with varieties (hybrid or open pollinated) known to be suitable for the

targeted environments. As a consequence, the program undermined the capacity of

farmers to choose what variety they preferred. They were effectively given a voucher

redeemable for one variety alone – the one winning the tender for the targeted district.

The project found no evidence of rejection of seed varieties being distributed. However,

this procurement strategy limits the development of competitive markets and probably

limits the introduction of new varieties. This constraint has been partially resolved by the

testing of open-ended vouchers in more recent input distribution programs. However,

questions remain whether open-ended vouchers are viable in outlying areas where input

markets are poorly developed. In summary, the lesson learned from this project is that

open-ended vouchers would better stimulate competitive input supply markets and should

be used whenever possible. Under such as system distributors would be allowed to

exchange vouchers for inputs that they have sourced themselves. One caution in

emergency situations is that distributors may not be able to source inputs because of cash

flow constraints or other logistical issues and the project would need to provide a stock of

inputs to suppliers. In these situations it may be beneficial to procure inputs from more

than one supplier to provide farmers with a choice. Procuring from multiple sources

would also avoid the market dislocation caused by hiring one supplier one year and

another next, as discussed in more detail below.

67. Input Market Development Takes Time – Multi-year Emergency Projects may

be Better. The primary aim of the project was to get maize seed into the hands of needy

farmers quickly and efficiently. This aim was successfully achieved. One spillover,

pursued through the voucher pilot was to also re-build linkages between seed suppliers

and rural retailers. However, it was evident that this objective can only be effectively

achieved with multiple years of support involving a common set of companies. The

simple fact that one seed company won the tender to work with local retailers in 2009/10,

and another won the tender in 2010/11, undermined the development of these commercial

linkages. At best, the relationship was initiated and companies now better understand the

prospects of rural markets. But multiple years of support are necessary to build

sustainable markets.

20

7. Comments on Issues Raised by Grantee/Implementing Agencies/Donors (a) Grantee/Implementing agencies

68. See Executive Summary of the Completion Report prepared by GRM

International (Annex 7).

(b) Cofinanciers/Donors

69. There were no co-financiers.

(c) Other partners and stakeholders N/A

21

Annex 1. Project Costs and Financing

(a) Project Cost by Component (in US$ million equivalent)

Components Appraisal Estimate

(US$ millions)

Actual/Latest

Estimate

(US$ millions)

Percentage of

Appraisal

Provision of Improved Seeds 6.10 5.86

Project Coordination, Monitoring

and Evaluation 0.90 1.14

Total Baseline Cost 7.00 7.00

Physical Contingencies

0.00

0.00

0.00

Price Contingencies

0.00

0.00

0.00

Total Project Costs 7.00 7.00

Project Preparation Costs 0.00 0.00 0.00

0.00 0.00 0.00

Total Financing Required 7.00 7.00

(b) Financing

Source of Funds Type of

Cofinancing

Appraisal

Estimate

(US$ millions)

Actual/Latest

Estimate

(US$ millions)

Percentage

of

Appraisal

Trust Funds 0.00 0.00

Global Food Crisis Response

Program 7.00 0.00 0.00

22

Annex 2. Outputs by Component

Table A.1: Components by Output and Outcome ZEAIP

Component

Project

Specific

Outcome

Indicator End-Project

Status

Percent

Achieved and

Comments

Type of

Indicator

Provision of

Improved Seed

Increased

availability of

improved seed

Seeds procured

and distributed

to farmers (mt)

3,630 mt

hybrid seed

105%

Target exceeded

Intermediate

Outcome

Proportion of

seed distributed

planted

(percent)

90% 100%

Target achieved

Intermediate

Outcome

Proportion of

seed distributed

to farmers

before the end

of November

(percent)

94% 104%

Target exceeded

Intermediate

Outcome

Efficient seed

delivery

mechanism

piloted

Farmers

receiving

vouchers

(number)

86,193 123%

Target exceeded

Intermediate

Outcome

Proportion of

vouchers

redeemed by

farmers in

exchange for

seed within 4

weeks of receipt

(percent)

97% 108%

Target exceeded

Intermediate

Outcome

Proportion of

vouchers paid

out by GRM

within 3 weeks

of receipt

(percent)

66% Actual fell below

target due to

payout delays

between GRM

and seed

suppliers

Intermediate

Outcome

Project

Coordination,

Monitoring and

Evaluation

Improved

project

reporting and

management

Percent of

project reports

submitted on

time (percent)

100% 100%

Target achieved

Intermediate

Outcome

Procurement

completed

within one

month of plan

(percent)

0% Did not achieve

target due to

procurement

delays but this

did not affect

project

implementation

Intermediate

Outcome

Project rated

satisfactory

during each

supervision

mission

Yes Yes

Achieved

Intermediate

Outcome

23

Table A2.2: Maize yield for hybrid versus OPV seed for 2009/10 cropping season

Districts ZEAIP Seed (kg/ha) Non-ZEAIP Seed (kg/ha)

Hybrid OPV Hybrid Improved OPV Recycled

(SC513) (ZM521)

Hwange 1,404 809 1,024 651 461

Masvingo 982 1,068

Gokwe 1,044 955 412 758

Bindura 1,670 1,606 869

Hurungwe 1,567 1,328 1,099 789 573

Zvimba 2,049 1,538 589 497

Total 1,747 1,076 1,252 660 620 Source: ZEAIP Post Harvest Report, ICRISAT; December 10, 2010.

Table A2.3: Contribution of ZEAIP seed to total maize area planted by beneficiaries in

2010/11.

Natural

Region District

Mean area planted

to ZEAIP maize

(ha)

Mean total area

planted to maize

(ha)

Percent contribution

of ZEAIP to total

maize area

NR II Murehwa 0.39 0.79 49.37

Shamva 0.49 0.77 63.64

NR III Gweru 0.45 0.95 47.37

Chirumhanzu 0.46 0.74 62.16

Chikomba 0.44 0.84 52.38

NR IV Zaka 0.45 0.98 45.92

Masvingo 0.44 0.92 47.83

Insiza 0.48 0.85 56.47

Matobo 0.45 0.79 56.96

NR V Nyanga 0.46 0.84 54.76

Chimanimani 0.42 0.65 64.62

Buhera 0.49 0.71 69.01

Average (NR II-V) 0.45 0.82 55.87 Source: ZEAIP Household Post Planting Report, ICRISAT; June 1, 2011.

24

Annex 3. Economic and Financial Analysis

Overview

1. This annex presents results of the economic and financial analysis of the ZEAIP.

The Project Development Objective was to increase access to improved seed among

300,000 smallholder farmers farming in targeted food-insecure Communal Lands of

Zimbabwe.

2. The analysis indicates that the project represented an efficient approach to

addressing food security needs of vulnerable households in Zimbabwe. This conclusion

is based on the findings from two approaches to measuring the project‘s efficiency. The

first approach relies on an analysis by ICRISAT23

of the project‘s cost effectiveness. The

second approach uses a simple benefit-cost analysis. As this was an emergency project, a

conventional economic and financial analysis was not carried out during appraisal to

calculate the net present value (NPV) or economic rate of return (ERR).

Methodology

3. Cost-effectiveness: In ICRISAT‘s cost-effectiveness analysis, the component

costs were examined using four lenses: (i) procurement of ZEAIP inputs; (ii)

implementation of ZEAIP by NGOs; (iii) management of ZEAIP by the implementing

agency; and (iv) beneficiary costs. Procurement costs included bulk seed purchase, cost

of transporting the seed to either NGO delivery points (for direct distribution) or retail

outlets (for voucher program), and other services such as voucher printing, training and

commission handling.

4. Overall, for the first year 2009/10, the total cost per beneficiary to undertake

direct distribution of maize seeds was US$24.09, inclusive of the costs of seeds, transport

and distribution, NGO implementation costs, and other associated costs. Voucher

distribution of seeds was only slightly higher at US$24.63 per beneficiary. For 2010/11,

the cost of voucher distribution was US$27.31 per beneficiary. Including NGO costs but

excluding implementing agency costs brings this cost down to US$23.02. The detailed

breakdown of the costs is presented in Table A3.1. These costs are very similar to the

local retail price of US$22 – US$23 for a 10 kg bag of improved maize seed in rural

outlets. Finally, beneficiary costs were assessed as the opportunity cost of time spent

attending community meetings, and redeeming vouchers where applicable. The

beneficiary households incurred these costs as part of their efforts to obtain the inputs

from this project, and other parallel projects that were distributing agricultural inputs.

This opportunity cost was significantly lower than the value of the total assistance

received by beneficiary households through this project and the other parallel projects.

23 ZEAIP Retailer Voucher Performance Report, ICRISAT: July 17, 2011.

25

Table A3. 1. Project Costs per Beneficiary

Cost Category Year 1 Year 2

Voucher

Distribution

Costs

(US$/Beneficiary)

Direct

Distribution

Costs

(US$/Beneficiary)

Voucher Distribution

Costs

(US$/Beneficiary)

Seed cost, transport &

distribution costs

17.49 19.52 20.31

NGO costs 3.75 2.25 2.71

Other associated costs 2.86 2.86 4.86

Total Costs 24.09 24.63 27.61

Source: ICRISAT24

findings from GRM data and calculations based on seed supplier and NGO contracts

5. Benefit-Cost Analysis: A benefit-cost analysis gives a project benefit-cost ratio

of 1.7. This finding is based on crude estimates of the incremental benefits to farmers

from increased maize production and increased yields compared to the total project cost

of US$7 million. The key assumptions are presented Table A3. 2. The value of the

increased maize production from this project is estimated based on the local retail price

estimated at US$0.28/kg for 2010 and US$0.32/kg for 201125

. The local retail price is

used to estimate the value of maize production because it represents the price at which

the households, being net deficit in food, would have had to purchase grain on the local

market. The retail prices are obtained using the FAO GIEWS Food Price Data and

Analysis Tool26

. The benefit-cost analysis is based on a 14 percent increase in cropped

area27

.

24 ZEAIP Retailer Voucher Performance Report, ICRISAT; July 17, 2011.

25 This is a conservative estimate of the value of this seed to net deficit households. The additional maize

production resulting from the ZEAIP offset the need to import and distribute food aid which was estimated

in the EPP at US$500 per mt implying a local grain value of at least US$0.50 per kilogram given rising

regional grain prices over the period of this project. The additional production might alternatively be valued

in terms of the nutritional gains derived from the consumption of more grain calories, though this gain is

difficult to quantify. 26

Source: http://www.fao.org/giews/pricetool2/ 27

ZEAIP Post Harvest Report, ICRISAT; December 10, 2010.

26

Table A3. 2. Benefit-Cost Analysis

Key Assumptions

Incremental

Value of Maize

Production

Benefit/cost

ratio

Maize production is valued at local retail price of

US$.28/kg in 2010 and US$.32/kg in 2011

Improved seeds led to increased yields of 1747 kg/ha

for hybrid seeds and 1076 kg/ha for OPV compared to

yields of 620 kg/ha for recycled seeds.

Of the yield gains realized, 1/3 can be attributed to the

improved seed varieties while 2/3 can be attributed to

fertilizer.

Farmers increased cropped area by 14 percent

US$11,977,186.95 1.7

6. The analysis of the benefit-cost ratio is subject to some basic assumptions. First,

the analysis assumes that all other inputs (primarily farmers‘ labor) would have been

invested in the project areas in the counterfactual scenario (in the absence of the project).

Second, the analysis assumes that the investment and application of US$7 million in

project costs to distribute improved seed resulted in higher yields and incremental value

of approximately US$12 million. Lastly, the analysis assumes that, given the short

duration of the project, no discounting need be applied to the estimated benefits.

7. Non-Monetary Benefits: In addition to the direct benefits from the project, the

project resulted in two notable indirect benefits. First, the pilot initiative to use vouchers

to distribute hybrid maize seed strengthened the retail distribution system of the national

maize seed industry. By strengthening the linkages between seed companies and rural

retail shops, the project had likely beneficial impacts on reviving the maize seed market.

The project‘s second indirect benefit came from the use of NGOs and extension agents to

engage farmers and ensure the appropriate use of the agricultural inputs. This investment

by the project, if it led to sustained productivity gains from improved farmer knowledge

and practices, would result in higher yields in future seasons.

27

Annex 4. Grant Preparation and Implementation Support/Supervision Processes

(a) Task Team members

Names Title Unit Responsibility/

Specialty

Lending/Grant Preparation

David Rohrbach Senior Agricultural Economist AFTAR Task Team Leader

Watson Caesar Chidawanyika Agricultural Economist AFTAR

Fenwick Chitalu Financial Management Specialist AFTFM

Wedex Ilunga Procurement Specialist AFTPC

Suzanne Morris Senior Finance Officer LOAFC

Nicolette DeWitt Lead Counsel LEGAF

Anthony Molle Counsel LEGAF

Victoria Gyllerup Operations Officer AFTRL

Kristine Schwebach Social Safeguards AFTCS

Lungiswa Thandiwe Gxaba Senior Environmental Specialist AFTEN

Jeffrey Racki Consultant SASDU

Supervision/ICR

David Rohrbach Senior Agriculture Economist AFTAR Task Team Leader

Iain Shuker Program Coordinator AFTAR

Pauline McPherson Operations Officer AFTAR ICR Primary

Author

Omar Lyasse Senior Agriculture Economist AFTAR

Simon Chenjerani Chirwa Senior Procurement Specialist AFTPC

Wedex Ilunga Senior Procurement Specialist AFTPC

Daniel Yaw Domelevo ET Consultant AFTFM

Kwaw Andam Young Professional CFPMI

Hawanty Page Sr. Program Assistant AFTAR

Hope Dickens Lunga

Murombwi Program Assistant AFMZW

(b) Staff Time and Cost

Stage of Project Cycle

Staff Time and Cost (Bank Budget Only)

No. of staff weeks US$ thousands (including

travel and consultant costs)

Lending 2.25 17,880.00

Total: 2.25 17,880.00

Supervision/ICR 29.01 300,282.00

Total: 29.01 300,282.00

Note: The figures reflected for preparation and supervision were charged to a separate Bank-

executed trust fund budget.

28

Annex 5. Beneficiary Survey Results

N/A

29

Annex 6. Stakeholder Workshop Report and Results

Summary Notes

Subsidized Input Delivery and Market Development Workshop

Imba Matombo, April 23, 2010

Workshop organized by the Agrarian Sector Technical Review Group (ASTRG)

of the Multi-Donor Trust Fund

Free or heavily subsidized agricultural inputs have been offered to needy smallholder

farmers most years since the catastrophic drought of 1991/92. These programs have been

run by government and donors consistently over the past five years, and have accounted

for the dominant share of seed and fertilizer sales in the country. This has severely

undermined wholesale and retail trade of these inputs. Despite recent improvements in

the economy, many rural traders remain reluctant to stock seed or fertilizer given the

risks of competing with subsidized deliveries by NGOs or government.

There is broad agreement that these subsidy programs are not sustainable. Commercial

input markets need to be strengthened, and farmers need to be encouraged to regularly

purchase their seed, fertilizer and agro-chemical needs at market rates.

Yet the demand for subsidized inputs remains. These are viewed necessary to strengthen

agricultural productivity in order to help the country meet its basic food needs.

Subsidized inputs appear likely to remain a staple component of drought relief programs.

And free inputs are still viewed necessary to help severely impoverished farm households

to lift themselves out of poverty.

In this context, two questions arise. How can subsidized inputs be delivered in a market

friendly manner? And how can the transition from free handouts to commercial purchases

be achieved?

Purpose of Meeting

In recent years there have been multiple experiments with delivery of subsidized

agricultural inputs in more market friendly ways. The main purpose of this workshop (see

Agenda in Annex 1) was to review lessons drawn from these endeavors, and discuss their

implications for future investments in subsidized input supply.

The presentations started with a historical review of market based input assistance

programs. This led into a more detailed discussion of several input voucher programs

implemented during the 2009/10 summer planting season. One presentation summarized

early lessons relating to the use of input consignment insurance aiming to encourage

flows of seed and fertilizer from wholesalers to rural retail shops. A complementary

presentation reviewed opportunities for linking input supply with the development of

product markets. A presentation examined strategies for linking input supply with public

works. And another highlighted some of the lessons drawn from the larger and more

30

sustained commitment to input subsidies in neighbouring Malawi. Finally, national seed

and fertilizer companies were asked to outline their views of the transition from a

dependence on sales through publicly funded programs to a stronger commercial market.

The workshop participants encompassed a range of government representatives,

development partners, NGO representatives and industry delegates (see participants list

in Annex 2). Under the guidance from an international expert familiar with the evolution

of input delivery under humanitarian auspices throughout Africa, the group completed

these deliberations with a discussion of lessons to be drawn for the next few agricultural

seasons.

Starting Agreement

Stop the direct distribution of free seed and fertilizer (―in-kind‖ distribution)

There is a growing consensus encompassing government, development partners, and

other stakeholders on the need to move away from free handouts of agricultural inputs to

smallholder farmers under humanitarian and development programs. In recent years,

these deliveries have encouraged input suppliers to concentrate their efforts on the pursuit

bulk sales to government and NGO programs. The expansion of these sales, in

combination with capital constraints and hyperinflation, have severely undermined the

operations of wholesale and retail markets for a seed and fertilizer, in particular. Retailers

question whether to stock inputs that may be provided by government or NGOs for free.

This particularly affects sales in outlying rural markets.

Workshop participants were divided about whether direct, free deliveries should be halted

altogether. Some argued that a ‗most vulnerable group‘ of chronic poor (e.g. HIV/AIDS

affected households) may still need such assistance as part of a social protection strategy.

Others suggested the need for continuing support for direct delivery in outlying areas

where input markets, particularly for fertilizer, are least developed. But most agreed that

reliance on direct input distribution to farmers should be sharply reduced, and possibly

eliminated over time.

Strategic Decisions

The Promise of Vouchers

Results of various types of vouchers programs were presented. The overall assessment

was that voucher programs can offer good access to seed and fertilizer and other

productive inputs while stimulating the development of rural retail businesses. These may

encourage farmers to look to retail shops for their broader input needs in the future. Yet

many questions remain about how best to implement these sorts of programmes. Key

considerations include the following:

a) tied input delivery – Most input voucher programs in Zimbabwe have

historically been linked with the subsidized purchase and delivery of a stipulated

31

set of inputs. In effect, vouchers are redeemable at a retail shop for a specific set

of inputs provided by the project investment. This assures the availability of

inputs when farmers seek to redeem their vouchers. But what would happen if

vouchers were provided without the supply of inputs? Are retail markets

developed enough to assure that inputs will be available commercially when

vouchers are presented for redemption? Will seed and fertilizer companies be

willing to compete for voucher based sales? This is already happening in Malawi,

most successfully for seed. But the evidence in Zimbabwe remains limited.

b) top-up payments – In most voucher programs, the external project or input

supplier pays the retail markup. In effect, retailers are paid for their shop space

and time. Farmers may be encouraged to pay a share of their input costs, starting

with the retail markup. In Malawi, for example, farmers regularly pay a share of

the costs of subsidized inputs. In the case of seed, this covers the retailer‘s

margins. In the case of fertilizer, this top-up is returned to the government.

c) flexible vouchers – a more flexible voucher would allow farmers a choice of

agricultural inputs. This includes a choice of seed types, a choice of alternative

inputs (e.g. seed versus fertilizer), and a choice of the quantities of different types

of inputs to be purchased. One farmer may purchase more seed, while another

buys more fertilizer. It also allows more flexibility in different agro-regions rather

than an imposed set of inputs. A significant number of participants saw this as the

most appropriate approach for the coming season. However it was recognized

that it would only be appropriate where it was realistic for an adequate range of

inputs is being stocked to allow farmers a choice.

d) cash transfers – the broadest choice is provided by cash transfers. These allow

farmers to purchase whatever goods or services they most need. A growing range

of literature suggests these offer the highest multiplier effects in cash strapped

communities. There remains the worry that farmers will simply use these

transfers to buy consumer goods such as cooking oil and clothing., Others note

that most poor rural households spend more on agro-inputs than provided by most

donor funded schemes making this concern less significant.

Public Works

There is broad interest in the use of public works programs as a means to help target

input delivery (to households in such need that they are willing to contribute labor to

these programmes) and encourage farmers to ‗pay‘ for their seed and fertilizer.

Practitioners warn, however, that to be meaningful, public works programmes first need

to be carefully organized and funded. In many cases, inadequate investment in preparing

public works leads to poor and unsustainable results. Technical designs are deficient, the

tools for carrying out the works are lacking, or the supervision is inadequate.

One conclusion is that public works programmes should not be established as a means to

deliver subsidized inputs. Rather the main objective should be a quality public works

32

product in and of itself. The means of payment, whether by cash, or inputs, or input

vouchers, is of secondary importance.

Another risk is that targeting is poor because some needy are unaware of the opportunity,

or the opportunity to work is restricted to a subset of households residing in local

communities. A further problem is the difficulty of accounting for public works payments.

It appears there is limited experience with the linkage of public works with input supply

in Zimbabwe. Initial investments in capacity building may help assure these sorts of

commitments offer higher and more sustained payoffs.

Input Consignment Insurance

In the past, seed and fertilizer companies provided retail agents with consignments of

inputs which could be paid for as they were sold. At the end of the season, the input

supplier would to take back unsold stock. However, this practice disappeared with the

rise of capital constraints and hyperinflation. In 2009/10, one project provided insurance

to wholesalers willing to provide seed and fertilizer on consignment to a sub-set of 71

rural retailers. The experience was positive, leading to an expansion of retail sales, while

maintaining a limited insurance liability. Proposals are now on the table to expand the

coverage of this insurance programme to over 500 shops in 2010/11.

Questions remain about the true level of risks underlying this insurance liability. If larger

numbers of retailers participate, and monitoring per retailer declines, will losses sharply

increase? Can the local insurance industry handle the possible liability of millions of

dollars in payouts?

Questions also remain about the appropriate division of responsibility for premium

payments between an external project and the wholesaler.

Nonetheless, most workshop participants agreed on the value of expanding this

programme. If this happens, a stricter independent evaluation of the program may be

useful.

Linking Input Delivery with Output Markets

The main procedure for linking input delivery with output markets is through contract

farming. Farmers are provided with inputs, and sometimes extension advice, in exchange

for a commitment to sell their crop to a particular buyer. These arrangements have a

mixed, and often difficult history. Farmers are prone to side market their crop in order to

obtain higher prices, or avoid repayments for input loans. Buyers provide inputs late, and

farmers commonly worry that buyers pay too little for their crops. The frustration on both

sides of the contract has limited the expansion of these arrangements, though

experimentation with the strengthening of these endeavors continues.

33

Targeting

There seems to be broader agreement on the need to improve the targeting of input

subsidies, than on how this targeting should be pursued. Stakeholders most commonly

perceive three general categories of farmers:

i) those facing a chronic need for assistance because of very severe resource

constraints;

ii) those facing transitory needs, and lesser resource constraints, and

iii) those generally capable of meeting their own needs if markets are functioning.

Questions remain about the relative size of these household classes, and their capacity to

make effective use of input vouchers. Some argue that the poorest households simply

need consumption assistance while others argue that insofar as most of these families

remain active farmers, input assistance should logically remain a component of welfare

support.

A second, and less discussed need for targeting is by market status. Households residing

in areas with better market access are more likely to benefit from more flexible types of

voucher programs. Households residing in outlying areas with less market competition,

or service, risk difficulties in redeeming vouchers – either because inputs are simply not

available, or because local traders are collusive. Unfortunately, the distribution of

competitive, retail trade in agricultural inputs remains largely unknown.

No Single Solution

There was a strong consensus that blanket humanitarian and development responses

should be avoided. Zimbabwe encompasses considerable socio-economic differentiation,

and substantial agro-ecological variation. Different geographic regions are recovering and

growing at different speeds. In these circumstances experimentation with alternative

strategies should be encouraged. But if this experimentation is to be useful, there is also a

need for independent evaluation of the result.

Monitoring, Evaluation and Accelerated Learning

Strong monitoring systems, in real time, as the program unfolds, provide immediate

feedback necessary for refining and re-orienting programs. In complement, independent

evaluation is essential for accelerated learning.

It was noted that implementing agencies are rarely as effective at evaluating their own

efforts. The independence of the assessment increases the chances that problems may be

identified (as well as successes). And a fresh set of eyes can yield insights that would

otherwise remain hidden.

Good monitoring and evaluation requires a clearer articulation of performance criteria.

These include performance indicators specific to the project investment (e.g. quantity of

inputs delivered) as well as indicators of wider impact (e.g. production gains, and

strengthened retail trade). A proper evaluation requires a ―without treatment‖

comparison. Yet many evaluations only consider the beneficiaries of a given investment,

34

and infer that all changes are a result of the project. The inferences drawn from such

assessments will be flawed.

By inference, good monitoring and evaluation must be fully funded when a project is

designed. Proper evaluation is not cheap. But the repetition of mistakes in program

design may be substantially more expensive.

Information Gaps

Several key information gaps are undermining the planning of input delivery and market

development strategies in the short run. Three, in particular, were signaled for immediate

resolution:

a) Cash flow/buying power. How severe are cash constraints among target

populations? Can most farmers now be expected to contribute part of the costs of

buying inputs? How long will it take for most farmers to assume this entire

responsibility? Does there remain a significant population that is so poor that it

cannot even find a dollar as a possible top-up payment for voucher redemption?

How can the severity of cash constraints be monitored?

b) Client population characterization (stratification). What proportion of

Zimbabweans is most severely vulnerable, and will require social welfare-type

programs? What proportion of farmers need partial assistance necessary to expand

their production base? And what proportion of farmers only need improved access

to agricultural inputs in the market? Characterization of the rural populations into

well-defined client groups is a priority task in order to guide continuing

investments.

c) Retailer development. How quickly are retailers able and willing to initiate the

stocking of key agricultural inputs such as seed and fertilizer? What is the

distribution of these input markets? And by corollary, what is the likelihood that

farmers with vouchers will have difficulty finding the seed or fertilizer to

purchase from nearby retail shops?

Goal setting—and devising clear strategies to move towards goals

Finally, it seems evident that some of these programs may benefit from greater clarity in

their objectives. Workshop participants identified a broad range of priority short and

medium term goals encompassing humanitarian support, agricultural recovery and market

development. But if these objectives are not explicitly defined, the success of strategies

proposed to achieve them is difficult to judge. The program goals and objectives need to

be explicit and prioritized. Corresponding sets of performance indicators need to be

defined. Then lessons can be appropriately drawn.

35

List of Participants

No. Organisation Members in attendance Contact details (Address, Telephone, Email)

1. German Development Service

(DED)

Jan Karel Sorgedrager -

Programme Coordinator

Rural Economic

Development

Phone: 741 187

Fax: 741 683

Cell: 0912 264 860

le@dedsim.co.zw

2. Delegation of the European

Union to the Republic of

Zimbabwe

Joost Bakkeren - Attaché

Food Security

1 Norfolk Road, Mt Pleasant

Business Park,

338158/64 (Ext. 163), 338165

joseph.bakkeren@ec.europa.eu

3. Delegation of the European

Union to the Republic of

Zimbabwe

Pierre-Luc Vanhaeverbeke

Food Security Coordinator

1 Norfolk Road, Mt Pleasant

Business Park,

338158/64 (Ext. 162), 338165

Pierre-Luc.vanhaeverbeke@ec.europa.eu

5. French Embassy Charlotte Dementhon 703216 charlotte.dementhon@diplomatie.gouv.fr

6. Netherlands Embassy Joylyn Ndoro 776 701 joylyn.ndoro@minbuza.nl

7. Netherlands Embassy Marchel Gerrmann 776 701 marchel.gerrmann@minbuza.nl

8. DFID Alexis Ferrand 0912 511 372 a-ferrand@dfid.gov.uk

9.

10.

11.

12.

13.

FAO Michael Jenrich

Benjamine Hanyani-Mlambo

Pauline Hobane

Jean Claude Urvoy

Princess Gabayi

253650/3

011 874 864

011 716 673

0912 237 304

0913 588 879

michael.jenrich@fao.org

bmlambo@agric.uz.ac.zw

aphobane@hotmail.com

jeanclaude.urvoy@fao.org

princess.gabayi@fao.org

14. Farm and City Cleophas Mupariwa 0912 900 129, 799100 cleophas@farmandcity.co.zw

15. Red Star Wholesalers Noma Ndlovu 011 618 682 or 668901 – 5 nndlovu@redstar.co.zw

16.

17.

Ministry of Regional

Integration &

Int. Co-op

Irvin Chivaura

Jonathan Mhiribidi

783484/7 or 0913 048 971

783484/7 or 011 503 998

chivaurairvin@yahoo.com

jmhiribidi@yahoo.com

36

18. Munyaradzi Tumbare 783484/7 or 0913 466 391 munyaradzitumbare@gmail.com

19. AusAid Dorothy Mufanechiya 0912 870 171 Dorothy.Mufanechiya@dfat.gov.au

20. USAID Jim La Fleur 0912 565 963 jlafleur@usaid.gov

21.

22.

23.

Ministry of Labour and

Social Services

Sungano Chisina

Mildred Mapani

Elizabeth Chipendo

0913 506 163

0913 057 160

schisina@gmail.com

msmapani@sdf.org.zw

elichips@sdf.org.zw

24.

25.

Ministry of Agriculture,

Mechanisation and

Irrigation Dev.

Admire Jongwe

Ms. Mumera (Agritex)

0912 736 053

0912 967 964/794381

adjongwe@gmail.com

mmumera@gmail.com

26.

27.

Ministry of Economic

Planning and Investment

Promotion

Patience Yakobe

Blessed Mburinga

0915 105 949

pyakobe@gmail.com

bmburinga@gmail.com

28. GRM International Odreck Mukorera 0913 254 988

odreck@grm.co.zw

29. ZFU J. Gwaringa 0914 363 179 jgwaringa@zfu.org.zw

30. Care International Walter Sanchez 0912 277 444 waltersa@carezimbabwe.org

31.

32.

Consultants Katrina Wallace Karenga

Louise Sperling

0912 331 517

+255 682 913 191

katrina@yoafrica.com

l.sperling@cgiar.org

33. World Bank David Rohrbach +265-(0)999-983-100 drohrbach@worldbank.org

34. ICRISAT Kizito Mazvimavi 011 622 581 k.mazvimavi@cgiar.org

35. Swiss Agency for Lawrence Lewis Lawrence.Lewis@sdc.net

37

Development and

Cooperation (SDC)

36.

37.

SNV Rik Overmars

Bart Sijbenga

0912 288 915

0912 288 912

rovermars@snvworld.org

bsijbenga@snvworld.org

38.

39.

Seedco Cassian Manuhwa

Edward Mhandu

011 205 074

0912 240 858

cassiama@seedco.co.zw

edwardmh@seedco.co.zw

40.

41.

42.

Zimbabwe Fertiliser Co.

Vengere Amos

Richard Dafana

Lorraine Rubaba

0912 511 223

0912 410 314

0912 712 033

amosv@zfc.co.zw

dafanar@zfc.co.zw

rubabal@zfc.co.zw

43.

44.

45.

Ministry of Finance

Marcos Nyaruwanga

Chipo Madzwanya

Arina Manyanya

0912 472 215

0912 402 670

011 875 537

marcnyaruwanga@gmail.com

chiposibona2000@yahoo.co.uk

a-manyanya@yahoo.com

46. University of Zimbabwe –

Dept of Economics

Tamuka J. Mukura 0912 287 942 tmukura@social.uz.ac.zw

tmukura@gmail.com

38

Annex 7. Summary of Grantee's ICR and/or Comments on Draft ICR

39

40

Implementing Agency Comments on Draft ICR

On March 21, 2012.

See attached track changes. I have concentrated on the figures reported, some of which

appear to be simple typos, and some which I question.

Hope this helps.

For GRM International Limited

Terry Quinlan

41

Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders N/A

42

Annex 9. List of Supporting Documents

GRM International. ZEAIP Quarterly Report (P117212) for reporting period July to

September, 2009.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period October to

December, 2009.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period January to

March, 2010.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period April to

June, 2010.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period July to

September, 2010.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period October to

December, 2010.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period January to

March, 2011.

GRM International. ZEAIP Quarterly Report (P117212) for reporting period April to

June, 2011.

GRM International. Zimbabwe Emergency Agricultural Inputs Project (P117212):

Completion Report July 2009 to June 2011; Closing Date September 30, 2011; December

2011.

ICRISAT. ZEAIP Post Planting Impact Assessment Report, July 22, 2010.

ICRISAT. ZEAIP Post Planting Impact Assessment Report, August 30, 2010

ICRISAT. ZEAIP Retail Vouchers Assessment Report, August 27, 2010

ICRISAT. ZEAIP Post Harvest Report, December 10, 2010.

ICRISAT. ZEAIP Household Post Planting Report, June 1, 2011.

ICRISAT. ZEAIP Retailer Voucher Performance Report, July 17, 2011.

World Bank. Interim Strategy Note, FY08-09 for the Republic of Zimbabwe, April 12,

2007. Report No. 39128-ZW.

43

World Bank. Emergency Project Paper on a Proposed Grant under the Global Food

Crisis Response Program in the amount of US$7 million to GRM International Limited

for a Zimbabwe Emergency Agricultural Input Project, July 30, 2009. Report No. 49621-

ZW.

World Bank. Restructuring Paper on a Proposed Project Restructuring of Zimbabwe

Emergency Agricultural Input Project Grant (TF95035) to the GRM International

Limited, September 22, 2010. Report No. 56806 v1.

World Bank, various dates. ZEAIP Implementation Status and Results Reports (ISRs).

World Bank, various dates. ZEAIP Aide Memoires of Implementation Support Missions.

M AM A TT A B E L E L A N DA B E L E L A N DN O RN O R T HT H

M AM ATTA B E L E L A N DA B E L E L A N D

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M A S V I N G OM A S V I N G O

M I D L A N D SM I D L A N D S

M A S H O N A L A N DM A S H O N A L A N D W E S T W E S T

M A S H O N A L A N DM A S H O N A L A N DC E N T R A LC E N T R A L

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KanyembaKanyemba

KaribaKariba

KildonanKildonan

NyangaNyanga

MutokoMutoko

MvumaMvuma

KadomaKadoma

ZvishavaneZvishavane

LegionLegionMineMine

ShurugwiShurugwi

ChiredziChiredzi

SangoSango

NyikaNyika

GutuGutu

RutengaRutenga

BeitbridgeBeitbridge

WWestestNicholsonNicholson

MakadoMakado

EsigodiniEsigodini

ThuliThuli

RupisiRupisi

RusapeRusape

ShamvaShamva

Mt. DarMt. Darwinwin

ChirunduChirundu

MakutiMakuti

KaroiKaroi

MhanguraMhangura

MuzarabaniMuzarabani

GokweGokwe

DahliaDahliaDeteDete

HwangeHwange

BulawayoBulawayo

LupaneLupane

ChinhoyiChinhoyi

BinduraBindura

MaronderaMarondera

MutareMutare

GwandaGwanda

MasvingoMasvingo

HARAREHARARE

ZAMBIA MOZAMBIQUE

MOZAMBIQUE

SOUTH AFRICA

BOTSWANA

To Chirundu

To Mazabuka

To Fingoé

To Tete

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To Massangena

To Mapai

To Soutpansberg

To Pietersburg

To Nata

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M A T A B E L E L A N DN O R T H

M ATA B E L E L A N D

S O U T H

M A S V I N G O

M I D L A N D S

M A S H O N A L A N D W E S T

M A S H O N A L A N DC E N T R A L

MA

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Mvuma

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LegionMine

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Rutenga

Beitbridge

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Makado

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Chimanimani

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Marondera

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Sanyati

Zambezi

Mazoe

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Shashe

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26°E 28°E 30°E 32°E

28°E 30°E 32°E

20°S

22°S

18°S

16°S

20°S

22°S

18°S

16°S

ZIMBABWE

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.

0 50 100

0 50 100 Miles

150 Kilometers

IBRD 33515

OCTOBER 2004

Z IMBABWESELECTED CITIES AND TOWNS

PROVINCE CAPITALS

NATIONAL CAPITAL

RIVERS

MAIN ROADS

RAILROADS

PROVINCE BOUNDARIES

INTERNATIONAL BOUNDARIES