Skills and Employability Enhancement Project (RRP TAJ 51011)

DETAILED ECONOMIC ANALYSIS

A. Rationale

1. Tajikistan is a mountainous, landlocked country. It is the smallest in Central Asia in terms of land area. Tajikistan became an independent sovereign nation when the Soviet Union disintegrated in September 1991. A civil war ensued almost immediately after independence, lasting from 1992–1997. The country’s economy grew steadily after the end of the civil war, attributed mainly to the newly established political stability, growth in the country’s main export items of cotton and aluminum resulting from favorable world prices over the period. 2000-2008, and large remittances from Tajik migrant workers in the Russian Federation. As a consequence, the country’s gross domestic product (GDP) expanded at an average rate of 8.0% over the period, 2001–2013. From 2014-2017, the country’s economy continued to grow, albeit at a slightly lower rate of 6.8%, thereby further improving Tajikistan's position among the Central Asian countries.1

2. Due to lack of job opportunities in Tajikistan, many job seekers tend to migrate to other countries, mainly to the Russian Federation, which hosts over 90% of Tajik migrant workers, to find employment. The country continues to be heavily dependent on remittances. However, due to the economic slowdown in the Russian Federation and the implementation of stringent new work visa requirements, more than 200,000 migrant workers had to return to Tajikistan in 2014.2 In 2014, remittances were estimated at about $3.3 billion, a decrease of about $0.4 billion from $3.7 billion in 2013. In 2017, remittances further decreased to $2.2 billion, about 31.3% of the country’s GDP.3 Migration from Tajikistan and the consequent remittances have been unprecedented in their magnitude and economic impact.

3. Tajikistan has transitioned from a planned to a market economy without substantial and protracted recourse to aid and by purely market-based means, simply by exporting its main commodity of comparative advantage, i.e., cheap labor. Although remittance-driven growth since the early 2000s has led to a steep decline in the poverty rate, poverty remains high. In 2007, the country’s poverty incidence rate was 53.5%,4 which dropped significantly to about 32% (footnote 1) in 2014 and decreased further to 29.5%5 in 2017. Strong economic growth in the last decade, however, has not resulted in structural transformation to sustain improvements in the population’s standard of living. Jobs have been created, but these have been mainly in low-productivity activities, often in the informal sector. In addition, major inequalities currently exist in terms of labor market outcomes between population groups and across regions.6 For example, women have limited employment opportunities compared with men and are either unemployed or are employed in the informal sector, i.e., in jobs that do not require special skills, are labor intensive, and with low productivity.

1 The World Bank Group. 2020. World Development Indicators. https://datacatalog.worldbank.org/dataset/world-

development-indicators 2 ADB.. 2015. Sector Assessment (Summary): Education. Strengthening Technical and Vocational Education and

Training (RRP TAJ 46535-001). Manila. 3 Remittances data from http://www.worldbank.org/en/topic/migrationremittancesdiasporaissues/brief/migration-

remittances-data; contribution to GDP from https://data.worldbank.org/indicator/BX.TRF.PWKR.DT.GD.ZS?locations=TJ

4 ADB. 2016. Poverty Analysis (Summary). Tajikistan: Country Partnership Strategy 2016-2020. Manila. 5 ADB. Undated. Poverty Data: Tajikistan. https://www.adb.org/countries/tajikistan/poverty 6 The World Bank Group. 2017. Jobs Diagnostic – Tajikistan.

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4. Exacerbating the problem of employment in low-productivity activities are the low unemployment and underemployment rates, which mask the real picture because official statistics are based mainly on those who register for unemployment benefits. Actual unemployment and underemployment could be much higher, particularly for women and youth. The situation has worsened with the recent return of more than 200,000 migrant workers from the Russian Federation in 2014 due to stringent new work visa requirements, and with another 200,000 at risk of being deported. Combined with an estimated 150,000 new entrants into the labor force every year, the unemployment situation in Tajikistan has become a serious issue and is now being given high priority by the government.7 It is in this regard that the government is implementing a comprehensive program for job creation, which is supported by structural changes to further enhance the technical skills of the country’s labor force and increase opportunities for employment at home and abroad. The government has given high priority to the improvement of the quality and delivery of technical and vocational education training (TVET) to allow a greater number of skilled laborers to participate in the labor market and sustain the country’s economic growth and current development trends.

B. Tajikistan’s TVET Sector

5. The government’s TVET system is composed of 63 lyceums and 30 adult learning centers (ALCs) run by the Ministry of Labor, Migration and Employment (MOLME). In addition, there are 49 technical colleges (TCs), largely managed by different ministries and state-owned enterprises, including the Ministry of Education and Science (MOES) (20), Ministry of Culture (MOC) (6), Ministry of Agriculture (MOA) (2), Ministry of Health (MOH) (15), Ministry of Energy (MOE) (3), Tajik Aluminum Plant (1), Hydropower Station of Rogun (1), and the Committee for Youth, Sports, and Tourism (CYST) (1). Lyceums offer one- and two-year diploma courses designed to produce skilled workers, craftspersons, and operators while TCs offer three- and four-year courses designed to develop technicians, foremen, and supervisors. ALCs offer short courses of one-, three-, and six-month duration for basic skills training and skills upgrading. Most lyceums also offer a limited number of shorter courses.8

C. Issues Affecting Sector Performance

6. The overriding characteristic of TVET in Tajikistan is the lack of a clear vision, mission, and strategy for a comprehensive and congruent development of this sector. Subsequently, investment in skills enhancement training and adult learning is mostly ad hoc, lacking a strategic direction and relevance to the existing market requirements. These have contributed to the perception that TVET is a poor optional extension of the general education system which has, in turn, resulted in the system’s inability to attract students.

7. Without an overarching policy and a well-defined delineation of responsibilities, constraints in the TVET sector remain unaddressed, resulting in poorly defined responsibilities for sector planning and administration and leading to MOLME’s weak accountability and limited role in providing more comprehensive and inclusive skills training.

8. Also contributing to the underperformance of the sector is the fragmented governance structure of the TVET system. Different groups of providers of skills enhancement training (i.e.,

7 ADB. 2015. Report and Recommendation of the President to the Board of Directors. Strengthening Technical and

Vocational Education and Training (STVET). RRP TAJ 46535-001. Manila. 8 ADB. 2015. Sector Assessment (Summary): Education. Strengthening Technical and Vocational Education and

Training (RRP TAJ 46535-001). Manila.

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public and private institutions, enterprise training centers, and non-government organizations [NGOs]) operate independently of each other. Even within the same groups, coordination is limited. Linkages with employers exist in some institutions but, in general, engagement between the TVET system and the private sector is very weak. Managed by different ministries, agencies, and private organizations, no central entity coordinates sector work to respond effectively to the needs of individual vocational education students and the labor market. Moreover, there is no established mechanism linking vocational education courses to market signals to guide course planning, delivery, and performance monitoring (footnote 9).

9. The vocational education system remains largely supply-driven, under-funded, and faced with many difficulties in the overall education system reform effort. Other specific issues have likewise contributed to the system’s underperformance. These include: (i) acute shortage of industrial training specialists and qualified teachers; (ii) lack of methodical literature and equipment; (iii) poor system to attract private sector investments in vocational education and staff training; (iv) physically and pedagogically obsolete training and production facilities; and (v) minimal uniformity in occupational training plans.9

D. Weak Pre-departure Services for Migrant Workers

10. Due to the lack of job opportunities in Tajikistan, many workers migrate to other countries (e.g., Russian Federation) to find employment. Only a small percentage of Tajik migrants are able to collect relevant information before going overseas and many are unaware of the risk of migration.10 Compared with the Philippines and Sri Lanka, which have more advanced pre-departure services, the migration service centers operating in the country have limited capacity to advice and provide information on which skills are in demand in the labor markets of destination countries and are, therefore, unable to guide prospective migrants. The centers are also not equipped nor staffed to be able to provide short-term pre-employment skills training, which could enhance the ability of migrant workers to find employment in a host country, as well as counselling on how to use remittances to improve the future of the family, rather than spending on consumer goods and family events. Reintegration of returning migrants remains a serious economic and social challenge as there is not enough support being provided to help address the issue of limited job opportunities in the areas where returning migrants reside.

E. Government’s Education Sector Strategy

11. The government introduced its National Development Strategy (NDS), 2016-2030, which outlines the country’s long-term strategies and plans. The NDS 2016-2030 serves as a logical continuation and further development of priority areas of national development, which were laid down in the NDS 2015, namely: (i) public administration reform; (ii) private sector development and investment raising; and (iii) human development. The NDS 2016-2030 envisions the transformation of Tajikistan from a primarily agriculture-based economy to an industrial-based economy.11

9 Hoover, Jones. 2014. Tajikistan Background Study. https://www.agrilinks.org/sites/default/files/resource/files/Tajikistan-Background-Report-Final-9.181.pdf

10 Murakami, Enerelt, Eiji Yamada, and Erica Sioson. 2019. The Impact of Migration and Remittances on Labor Supply in Tajikistan. JICA Research Institute. Tokyo.

11 Government of Tajikistan. 2016. National Development Strategy 2016-2030. Dushanbe.

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12. The development of the education sector is the government’s priority social policy to meet the strategic objectives in NDS 2016-2030, with high accord given to TVET.12 With the recognition of a well-functioning TVET system as an important element for economic development, cohesion, and social inclusion, the government increased budget allocations for the sector starting from 2012, although they remain at a low level, estimated at below 0.1% of GDP.13 To achieve higher growth, Tajikistan is implementing a structural reform agenda designed to: (i) reduce the role of the state and enlarge that of the private sector in the economy through a more favorable business climate, thus increasing private investment and generating more productive jobs; (ii) modernize and improve the efficiency and social inclusiveness of basic public services; and (iii) enhance the country’s connectivity to regional and global markets.14

F. Rationale for Investing in TVET

13. Tajikistan has a large working age population, accounting for about 61.3% of the country’s total population. As the country’s economy continues to grow and the associated demand for skilled labor increases, each of the economic sectors will require new job-specific skills to sustain growth and improve competitiveness. Against this background, the government will have to further increase investments in TVET to ensure that the growing young working population is well-equipped to participate in the job market and has the required skills for increasing labor productivity. The government also has to exert greater effort to improve coordination with, and participation of, private firms so that the vocational education courses offered are consistent with, and relevant to, the requirements of the job market. At the same time, the government will have to provide incentives to encourage greater private sector investments. This is in light of an underdeveloped formal private sector, which is currently operating in an environment with economic and institutional barriers, resulting in the low entry rate of new firms. In a market-driven and open economy, government incentives and actions to remove these barriers encourage the private sector to increase investments to modernize its operations. This will, in turn, facilitate the establishment of a thriving and robust formal private sector that can keep pace with the global economic mainstream, thereby creating more jobs and increasing employment opportunities for the country’s workforce.

14. The current low quality and ineffective technical vocational education is an issue that the government needs to resolve. Such a strategy will allow the government to achieve its goal of improving the country’s human resources, meet the skills requirements of a modernized and industrialized economy, and improve worker productivity. This is in response to the growing difficulties being faced by domestic and foreign firms in Tajikistan in filling job positions due to the lack of qualified candidates.

G. Demand and Supply Analysis

15. Labor supply. Tajikistan’s population in 2017 was estimated at 8.9 million. The population growth rate increased steadily from 1.8% in 2001 to 2.2% in 2016 but slightly decreased to 2.1% in 2017. About 73% of Tajikistan’s population resides in rural areas while the

12 Government of Tajikistan. 2011. Annual Message of the President of the Republic of Tajikistan. Dushanbe as cited

in ADB. Sector Assessment (Summary): Education. Strengthening Technical and Vocational Education and Training (RRP TAJ 46535-001). Manila.

13 ADB. Sector Assessment (Summary): Education. Strengthening Technical and Vocational Education and Training (RRP TAJ 46535-001). Manila.

14 Government of Tajikistan. 2016. National Development Strategy 2016-2030. Dushanbe.

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other 27% lives in urban areas. Urban population growth rate increased over the past years, from 2.24% in 2010 to 2.59% in 2017,15 while rural population decreased slightly by 0.3% over the same period – from 2.23% in 2010 to 1.93% in 2017.16

16. In 2017, Tajikistan’s working age population (i.e., population 15-74 years old) accounted for about 60% of its total population. It increased from 3.45 million in 2001 to 5.23 million in 2015 and further to 5.3 million in 2017, amidst high fertility rates. However, labor force participation in 2017 was estimated at about 43.6%, implying that more than 50% of working age adults was not in the labor force. In the same year, the female labor force participation rate was just 29.3%, compared to 62.4% among males.17 The low participation rate, according to a World Bank (WB) report, has resulted in significant underutilization of Tajikistan’s most valuable resource, its human capital. Many working age youth and adults, especially women, are neither employed nor looking for work and, therefore, are not contributing to economic growth.18 The majority of women who are working are mainly employed in low quality jobs in the informal sector, which represents a large and growing source of jobs.19 The WB report indicated that between 2007 and 2013, the proportion of all wage employees in the informal sector increased from 28% to 39%.

17. The same report also indicated that youth who are idle (i.e., those who are neither employed nor in school [NEET]) represent 40% of the total youth population (within the age of 15-24 years), which is high by international standards. Between 2003 and 2013, NEET rates among youth increased from 37% to 41%, despite relatively favorable economic conditions. Moreover, the NEET rate for female youth is considerably higher than for male youth. While youth are more likely to work in private sector wage jobs than adults, almost a third of employed young people are in unpaid (informal) jobs compared to 15% of adults. Youth are also significantly less likely to be self-employed (5% compared to 11% among adults).

18. The report further indicated that a large percentage of young cohorts of women are unable to complete secondary special/technical education compared with men. Moreover, employment opportunities for women have remained limited as the high disparity in employment rates among men and women continues to widen. Over the period 2003-2013, the disparity between male and female employment rates increased significantly. In 2003, the gap between male and female employment rates was 21 percentage points which increased to 35 percentage points in 2013. Employed women are somewhat more likely to work in the public sector, but almost 25% of women are involved in unpaid employment in family businesses compared to 13% among men. Women are also less likely to be self-employed (7% compared to 12% among men) or working with family in agricultural activities. Greater effort will have to be made to ensure that women have increased access to the training they need to participate in the formal agriculture sector.

19. Labor migration from Tajikistan to Russia, which accounts for about 99% of total migration, is dominated by male (92%) who are mostly married (71%). The majority of migrants are from rural areas of Tajikistan (71%) and do not have any professional education (71%). In general, the migrants choose to accept jobs that require unskilled labor, which pay significantly

15 https://www.ceicdata.com/en/tajikistan/population-and-urbanization-statistics/tj-urban-population-growth 16 https://www.ceicdata.com/en/tajikistan/population-and-urbanization-statistics/tj-rural-population-growth 17 https://datacatalog.worldbank.org/dataset/world-development-indicators 18 The World Bank Group. 2017. Jobs Diagnostic – Tajikistan. 19 Informal sector workers are those wage and salaried workers who lack an employment contract and unpaid family

workers excluding those who are self-employed.

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more than what skilled workers are paid in Tajikistan. This large wage differential has led to the rejection of professional education by many young Tajik citizens who expect to migrate to Russia to find employment.20

20. Demand for labor. The government is cognizant of the fact that Tajikistan needs a continuous stream of skilled workforce to sustain the country’s economic growth. There is now also a realization that the shortage of skilled labor/workforce in agriculture, industry, and services could derail the country’s development goals. Sustaining economic growth at the current level of about 7% requires assigning high priority to the development of the country’s human resources through policy reform and effective implementation of planned strategies for the TVET system and the education sector, in general. Tajikistan’s transition to a market-based and industrial economy will need to be matched by a shift in the skills pattern of its labor force. The maturing economy will demand a shift from the current predominantly low-skilled workforce to one with higher level skills.

21. More specifically, demand for skills related to complex communication and non-routine cognitive tasks is expected to continue to increase, while demand for routine and manual skills is expected to decline. With increased demand for skilled labor for specialized jobs, and shifting significantly from unskilled to skilled labor, the wages of highly skilled workers are expected to dramatically improve. As highly skilled workers seek employment in sectors that provide higher wages, a significant shift (or preference) is likely to occur in employment – from traditional, informal agriculture to more modern agricultural activities (e.g., postharvest, processing, packaging, transport, etc.) and to other sectors (e.g., industry and service sectors). As a result, returns to education and professional skills (i.e., their value in the marketplace) will sharply increase during the transition to a market-based economy. Increases in employment and wages will accrue to a shift in demand, rather than supply, as the main cause of these trends.

22. By sector, the largest demand for labor is observed to be in agriculture, at 51.1% in 2017 compared to 53% in 2010.21 As the economy grows, and as the services and industry sectors attract labor away from agriculture, the sector will continue to shrink. However, greater investments in less labor-intensive and high labor productivity are likely to occur to make the sector more efficient and meet the food requirements of the growing population. This, in turn, will increase demand for specialized labor skills required for certain agricultural activities within the modern value chain covering production, postharvest, processing, packaging, transport, etc. The proportion of the population employed in the services sector increased slightly from 31.2% in 2010 to 32.2% in 2017, while that in the industry sector increased from 15.8% in 2010 to 16.7% in 2017 (footnote 22). Further expansion of the services and industry sectors will likewise increase demand for better skilled workers in these sectors.

H. Labor Productivity

23. Annual labor productivity or annual value added per worker grew at an average of 5.2% over the period, 2001-2014, and by 5.8% from 2015-2017. Labor productivity levels in all sectors likewise grew steadily. From 2001 to 2017, labor productivity in agriculture and industry both grew at an average of 4.9% per year, while the services sector grew at an average of 4.7% per year (Fig. 1). A breakdown of labor productivity during the period, 2001-2017, indicated that about 90% of

20 Japan International Cooperation Agency. 2018. Migration, Living Conditions and Skills: Panel Study – Tajikistan

(unpublished). 21 https://datacatalog.worldbank.org/dataset/world-development-indicators

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aggregate growth came from industry (about 53%) and the services sector (about 36%), with agriculture accounting for about 11%.22

Figure 1: Productivity Trends by Sector 2001-2017

24. Despite recent increases, labor productivity levels remain very low by international standards, e.g., compared with that of Kazakhstan, Turkmenistan, India, Sri Lanka, Lao PDR, and Cambodia, among others (Fig. 2).23

Figure 2: Comparative Labor Productivity Levels by Country, 2018

I. The Challenge Ahead

25. The challenge for Tajikistan’s TVET sector is to generate a well-trained workforce with technical skills that meet the requirements of a rapidly growing and modernizing economy. As the country’s economic sectors (i.e., agriculture, industry, and services) become more modern and industrialized, the demand for technically skilled workers will continue to increase. This will, in turn, exert pressure on the government to improve the performance of the country’s TVET

22 https://datacatalog.worldbank.org/dataset/world-development-indicators 23 The World Bank Group. 2017. Jobs Diagnostic – Tajikistan.

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1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

2000 2005 2010 2015 2020

Agriculture value added perworker (constant 2010 US$)

Industry value added per worker(constant 2010 US$)

Services, value added per worker(constant 2010 US$)

-

10,000

20,000

30,000

40,000

50,000

60,000

In Constant 2011 $

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sector. To meet this challenge, the government must conduct a sound analysis of the changing conditions and requirements of the labor market. Simultaneously, the government will need to exert more effort to improve its governance and management of the TVET sector to establish clear and doable policy reforms to facilitate improvements in the country’s TVET system. In particular, government must clearly define its responsibilities and accountabilities in delivering and increasing access to improved quality TVET in various areas of the country. Enhancing the quality of TVET, improving the delivery of TVET-related services, and increasing equitable access to TVET opportunities are key enabling factors that will increase the labor participation rate of the country’s young working population. Moreover, improvement of TVET will benefit the poorest families as this will enable them to: (i) gain greater access to employment opportunities; (ii) participate in economic mainstream activities and further increase labor productivity; (iii) move out of poverty; and (iv) improve their overall social well-being.

J. The Program

26. ADB has been a major development partner of the government of Tajikistan in the skills sector. The planned project is in line with ADB’s Country Partnership Strategy with Tajikistan, which focuses on TVET as a means for developing the skills of the country’s workforce, including migrant workers and women.24 The Skills and Employability Enhancement Project (SEEP) will address the needs of the skills sector of Tajikistan and support youth and women who seek job opportunities in the domestic labor market as well as those who seek job opportunities in overseas labor markets. The SEEP is consistent with and supports the government’s NDS, 2016-2030, which articulates the country’s long-term strategies and plans for improving the country’s education sector, including TVET, and its role in the transition from a planned to a market economy.

27. The project will target the tourism, agriculture, and energy sectors, which are considered to have the greatest potential for increased productivity (i.e., agriculture) or the greatest potential for growth (i.e., tourism and energy). Due to the labor market demand in the Russian Federation, short-term training in the construction sector will be supported for migrant workers. Also, based on the need of migrant workers to be somewhat technologically literate, basic training on information and communication technology (ICT) has been identified as a core competency to be strengthened for both domestic and foreign job seekers.

28. The impact of the project, productive employment expanded, is also in line with the government’s NDS, 2016-2030. The project’s outcome is skills and employability of youth,25 women, and labor migrants for both the domestic and overseas labor market improved. This is envisioned to be achieved through three interrelated outputs, as described below.

1. Output 1: More Inclusive and Targeted Support Provided

29. Interventions under Output 1 will include: (i) new migration service centers for job seekers in overseas labor markets and migrant returnees established and equipped; (ii) more comprehensive pre-departure orientation (PDO) program to enhance the living conditions of migrants provided; (iii) new pre-employment training program to help migrants find better jobs provided; (iv) financial literacy and basic IT communication skills training for safe remittance transmission and better access to social welfare information provided; (v) behavior change

24 ADB. 2016. Tajikistan – Country Partnership Strategy 2016-2020. Manila. 25 For the project, youth is defined as labor force population age 15-29. The Labor Force Surveys of Tajikistan

provide statistics for age categories for 15-19, 20-24, and 25-29.

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initiative for migrants and migrant families piloted; and (vi) new job counselling services for returning migrants and banned migrations provided.

2. Output 2: Access to, and Relevance of, Public Employment Services Enhanced

30. Output 2 interventions will cover: (i) new model job centers that will provide job seekers with competency-based short-term training established and equipped; (ii) childcare centers provided and stipend program for female job seekers piloted; (iii) soft skills targeting conscientiousness and agreeableness piloted; (iv) job counselling using IT tools provided; and (v) ICT skills and knowledge of job center graduates improved to enhance their productivity.

3. Output 3: Planning and Management of Migration and Employment Services Strengthened

31. Interventions under Output 3 are: (i) International Labour Organization (ILO) International Standard Classification of Occupations (ISCO-08) introduced and used for the labor market database; (ii) skills and employment survey for the tourism sector piloted; (iii) labor market portal expanded and client tracking survey conducted; (iv) internationally good practices for migration and employment services introduced and disseminated; (v) awareness of the services of migration centers and job centers promoted; and (vi) adult learning centers’ capacity for skills training certification strengthened.

32. The interventions proposed under each output are envisioned to produce additional members of the labor force, who will be equipped with better technical, cognitive, and behavioral skills. Quantified economic benefits are envisioned to be mainly generated by Outputs 1 and 2. The establishment of three new migration service centers (Output 1) is expected to increase the number of migrant workers going through PDO and short-term skills enhancement training. These are envisioned to increase their opportunities for employment, at higher wages. This will, in turn, encourage migrant workers to increase their annual remittances, as a proportion of their annual income, to their respective families in Tajikistan. The construction of new job centers (Output 2) will also increase the number of trainees that may be accommodated for skills enhancement training. The development of training materials and strengthening of the capacity of job center staff on how to provide job guidance and training for short-term skills training in tourism, agriculture, and energy will improve the quality and relevance of technical education training. The improved access to, and relevance of, public employment services (Output 2) will encourage more workers to attend technical education training to improve their skills and eventually join the labor force and increase their income-earning capacity.

33. Project interventions under Output 3 to strengthen planning and management will efficiently and effectively mobilize resources for technical education training to meet the requirements of the labor market, particularly in the industry, agriculture, and services sectors. The enhanced capacity of planners and managers will result in the improved administration of training institutions and better delivery of quality technical education, thus, facilitating the achievement of Outputs 1 and 2.

34. The project will be funded by: (i) an ADB/ADF grant of $30.0 million; (ii) a Japan Fund for Information and Communication Technology (JFICT) grant of $1.5 million; and (iii) a government counterpart of $3.15 million, for a total project cost of $34.65 million.

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K. Cost-Benefit Analysis26 1. Assumptions Applied in the Economic Analysis

35. The following assumptions were applied in estimating incremental benefits generated by the migration service centers and job centers:

Table 1: Assumptions for Migration Service Centers and Job Centers Item Without

Project With

Project Increment

A. (i) (ii) (iii) (iv) (v) B. (i) (ii) (iii)

Migration Service Centers Migrant workers availing of pre-departure orientation services (workers/year) Number of migrant workers undergoing 5-day PDO Number of migrant workers receiving pre-departure training (PDT) Employment rate of migrant workers (%) Earnings of an employed migrant worker with 5-day PDO (TJS/year) Earnings of an employed migrant worker with 5-day PDO ($/year) Earnings of employed migrant worker with PDT (TJS/year) Earnings of employed migrant worker with PDT ($/year) Annual remittance as % of annual earnings of migrant worker (%) Job Centers Number of job center enrollees (enrollees/year): Tourism Agriculture Energy Employment rate of job center graduates (%) Annual earnings of an employed job center graduate ($/year) Tourism Agriculture Energy

25,872 a 23,285 2,587 95 a 21,383 b 2,206 b 17,841 b 1,820 b 50 c

763 444 e 175 e 144 e 40 a 1,604 f 630 f 2,270 f

35,200 a 31,680 3,520 97 a 24,558 b 2,534 b 20,287 b 2,093 b 55 d

2,808 1,744 e 584 e 480 e 55 a 1,765 f 693 f 2,497 f

9,328 8,395 933 2 3,174 328 2,646 273 5 2,045 1,300 409 336 15 160 63 227

a TRTA consultant’s estimate as discussed with the Project Administration Group, SEEP.. b International Organization for Migration (IOM). 2015. Diaspora – Partnership in the Development of Tajikistan. The

document provided values of average remuneration for skilled Tajik migrant workers in Russia which were expressed in 2015 terms which, in turn, were adjusted to 2019 terms.

c International Labor Organization. 2010. Migrant Remittances to Tajikistan. More than 60% of households in Tajikistan remittances account for more than 50% of their incomes.

d Assumed to be 5 percentage points higher than the annual remittances of a migrant worker under the “without project” situation.

e TRTA consultant’s estimate of enrollees in the technical education target courses under the “with” and “without’ project situations.

f TRTA consultant’s estimate based on discussions with key industry staff.

36. The migration service centers and job centers are envisioned to start operation by the third quarter of 2024. Therefore, benefits are expected to start streaming by then. Benefits were estimated using the world price numeraire method. Thus, remittances made by migrant workers, expressed in 2019 prices, were treated as tradables and their economic value assumed to be equal to their financial value. Benefits from increased incomes of job center graduates finding work in Tajikistan were also in constant 2019 prices, and their economic value was derived by applying a standard conversion factor (SCF) of 0.90.27 Incremental economic benefits were based on estimates derived from “with project” versus “without project” situations. The economic life of the project was assumed to be 25 years.

26 The economic analysis was carried out in accordance with ADB's Guidelines for the Economic Analysis of Projects (2017, as amended from time to time).

27 An SCF of 0.90 was applied in the economic analysis for ADB. 2015. Report and Recommendation of the President to the Board of Directors. Strengthening Technical and Vocational Education and Training (STVET). RRP TAJ 46535-001.

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2. Valuation of Benefits

37. Output 1 (more inclusive and targeted migration support provided) will provide a new PDO program, including counselling for migrant workers, individually or in groups, regarding the labor markets in the host countries by working with employers and employment agencies in these countries. The five-day PDO provided by the project will inform migrant workers on the cultural, legal, and social settings of the country, where they have chosen to find work, so they may be able to adjust to a foreign environment, avoid the risk of experiencing culture shock, and be more productive in their work. The PDO will increase migrant workers’ awareness of their rights as employees in a foreign country. This is essential for protecting themselves from potential mistreatment (e.g., lower wage provided compared with what was indicated in their contract) and abuse (e.g., long work hours and confiscation of passport) by employers as well as by placement agents who have facilitated their employment abroad (i.e., charging exorbitant placement fees and other fees). The PDO will likewise strengthen the capacity of migrant workers in making knowledge-based decisions regarding employment opportunities in the country they have chosen to work in. A short-term pre-departure training for migrant workers will also be provided covering identified occupations, e.g., construction. Technical training on general workplace skills will also be provided (such as health and safety, use of hand tools, and preparation and cleaning of workplace) adapted to the needs of the host country. Modular technical classroom trainings, which are adapted to the needs of the selected occupations in the construction sector, will also be provided. Language and basic ICT training, as well as family counselling on behavioral change regarding planning and organizing issues related to migration, will likewise be given. Overall, interventions to further improve technical skills and behavior among departing migrant workers will enhance their efficiency and productivity in the workplace, which will contribute to increased income-generating capacity of migrant workers abroad.

38. The interventions under Output 2 will improve the access of disadvantaged youth and females to job centers where they will be trained by capable and qualified trainers on soft skills and skills enhancement courses relevant to the existing requirements of the tourism, agriculture, and energy labor markets. This is envisioned to result in increased numbers of job center training graduates with better skills and greater opportunities for employment. Consequently, the training graduates will be able to apply their acquired knowledge and skills to work-related activities, thereby enhancing their competitiveness and productivity. Improved skills will also allow the new training graduates (or new skilled workers) to receive higher wages compared with those who are unskilled or less skilled due to the lower quality of technical education training they have received. A new skilled worker with minimal experience is expected to realize an annual wage, which is 10% higher than the minimum wage for specific jobs in the target sectors. The project interventions designed for Output 2 (i.e., access and relevance of skills training enhanced) are, therefore, expected to increase the returns to technical education among TVET graduates in Tajikistan.

39. Interventions to strengthen planning and management support in job and migration service centers (Output 3) will facilitate the achievement of Outputs 1 and 2 by effectively mobilizing resources for the centers to meet the skills requirements of the domestic and international labor markets. The improved capacity of center planners and managers will consequently result in the improved administration of job and migration service centers and more effective delivery of high-quality technical education and pre-departure orientation services.

40. Based on the above, the quantified economic benefits are based on: (i) benefits accruing to the newly developed PDO in the form of increased remittances made by migrant workers from

12

abroad (Russian Federation); and (ii) benefits from improved future income-generating capacity of employed job center graduates in jobs in Tajikistan.

3. Quantification of Benefits due to Increased Remittances by Migrant Workers

41. Incremental number of migrant workers. Under “with project” situation, a total of 649,443 skilled migrant workers are expected to undergo the five-day PDO program in the migration service centers compared with 477,338 migrant workers under the “without project” situation, over the period, 2024-2044. The incremental number of skilled migrant workers having gone through the five-day PDO is estimated at 172,105 for the period (Table 2).

Table 2: Projected Number of Migrant Workers at Migration Service Centers

42. Technical skills of some 3,520 migrant workers in the construction trades will also be enhanced annually under the project through pre-departure training (PDT). The training will also improve their behavior and attitude at work, thereby increasing their efficiency and productivity in the workplace and, consequently, increasing the wages that they may receive. Over the period, 2024-2044, a total of 72,160 migrant workers are envisioned to have undergone pre-departure training to improve their construction skills, compared with 53,038 migrant workers under “without project” situation, for an incremental number of 19,123 migrant workers. The project will produce a total incremental number of 191,228 skilled migrant workers over the period, 2024-2044 (Table 2).

Without Project With Project Without Project With Project

Number of Skiled Migrant Workers with 5-day Pre-

departure Orientation at

Service Centers

Number of Skiled Migrant Workers with 5-day Pre-

departure Orientation at

Service Centers

Number of Skilled Migrant Workers

with Pre-departure Job Training at Service Centers

Number of Skilled Migrant Workers

with Pre-departure Job Training at Service Centers

(Migrant Workers/Year)

(Migrant Workers/Year)

(Migrant Workers/Year)

(Migrant Workers/Year)

(Migrant Workers/Year)

(Migrant Workers/Year)

(Migrant Workers/Year)

20202021202220232024 11,642 15,840 4,198 1,294 1,760 466 4,664 2025 23,285 31,680 8,395 2,587 3,520 933 9,328 2026 23,285 31,680 8,395 2,587 3,520 933 9,328 2027 23,285 31,680 8,395 2,587 3,520 933 9,328 2028 23,285 31,680 8,395 2,587 3,520 933 9,328 2029 23,285 31,680 8,395 2,587 3,520 933 9,328 2030 23,285 31,680 8,395 2,587 3,520 933 9,328 2031 23,285 31,680 8,395 2,587 3,520 933 9,328 2032 23,285 31,680 8,395 2,587 3,520 933 9,328 2033 23,285 31,680 8,395 2,587 3,520 933 9,328 2034 23,285 31,680 8,395 2,587 3,520 933 9,328 2035 23,285 31,680 8,395 2,587 3,520 933 9,328 2036 23,285 31,680 8,395 2,587 3,520 933 9,328 2037 23,285 31,680 8,395 2,587 3,520 933 9,328 2038 23,285 31,680 8,395 2,587 3,520 933 9,328 2039 23,285 31,680 8,395 2,587 3,520 933 9,328 2040 23,285 31,680 8,395 2,587 3,520 933 9,328 2041 23,285 31,680 8,395 2,587 3,520 933 9,328 2042 23,285 31,680 8,395 2,587 3,520 933 9,328 2043 23,285 31,680 8,395 2,587 3,520 933 9,328 2044 23,285 31,680 8,395 2,587 3,520 933 9,328 Total 477,338 649,443 172,105 53,038 72,160 19,123 191,228

Incremental Number of

Skilled Migrant Workers with Pre-departure

Job Training at Service Centers

Year

Incremental Number of

Skilled Migrant Workers with 5-

day Pre-departure

Orientation at Service Centers

Construction Migrant Workers With Pre-departure Training

Total Incremental Number of Skilled Migrant Workers with 5-day Pre-

departure Orientation and

Pre-departure Job Training at Service

Centers

Skilled Migrant Workers With 5-day Pre-departure Orientation

13

43. Economic benefits from migrant worker remittances. For “with project” and “without project” situations, the economic annual earnings generated were estimated based on the number of Tajik migrant workers employed abroad (in the case of this analysis, Russia) multiplied by the average annual wage earnings of a skilled worker in the Russian Federation.28 The resulting value served as the basis for estimating the annual economic value of remittances made by migrant workers to their families in Tajikistan, which is assumed at 55% and 50% of their annual income under “with project” and “without project” situation, respectively (Table 3).29

Table 3: Economic Benefits from Remittances of Migrant Workers with Five-day PDO

28 It is assumed the migrant workers will be employed in the Russian Federation. 29 For more than 60% of households in Tajikistan, remittances account for more than 50% of their incomes. Source:

ILO. 2010. Migrant Remittances to Tajikistan. Remittances under the "with project" situation is assumed to increase by 5% from that the “without project” situation of 50%.

Year

Number of Migrant

Workers with 5-day Pre-

departure Orientation

Number of Migrant

Workers with 5-day Pre-departure

Orientation Finding

Employment Abroad

Annual Income of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

Annual Remittance of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

Cumulative Remittance of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

Number of Migrant

Workers with 5-day Pre-

departure Orientation

Number of Migrant

Workers with 5-day Pre-departure

Orientation Finding

Employment Abroad

Annual Income of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

Annual Remittance of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

Cumulative Remittance of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

(Migrant Workers/Year)

(Migrant Workers/Year) ($ million) ($ million) ($ million)

(Migrant Workers/Year)

(Migrant Workers/Year) ($ million) ($ million) ($ million) ($ million)

20202021202220232024 11,642 11,060 24.40 12.14 12.14 15,840 15,365 38.93 19.38 19.38 7.24 2025 23,285 22,121 48.80 24.28 36.41 31,680 30,730 77.86 42.63 62.01 25.60 2026 23,285 22,121 48.80 24.28 60.69 31,680 30,730 77.86 42.63 104.64 43.95 2027 23,285 22,121 48.80 24.28 84.97 31,680 30,730 77.86 42.63 147.28 62.31 2028 23,285 22,121 48.80 24.28 109.24 31,680 30,730 77.86 42.63 189.91 80.67 2029 23,285 22,121 48.80 24.28 133.52 31,680 30,730 77.86 42.63 232.54 99.02 2030 23,285 22,121 48.80 24.28 157.80 31,680 30,730 77.86 42.63 275.18 117.38 2031 23,285 22,121 48.80 24.28 182.07 31,680 30,730 77.86 42.63 317.81 135.74 2032 23,285 22,121 48.80 24.28 206.35 31,680 30,730 77.86 42.63 360.44 154.09 2033 23,285 22,121 48.80 24.28 230.63 31,680 30,730 77.86 42.63 403.07 172.45 2034 23,285 22,121 48.80 24.28 254.90 31,680 30,730 77.86 42.63 445.71 190.80 2035 23,285 22,121 48.80 24.28 279.18 31,680 30,730 77.86 42.63 488.34 209.16 2036 23,285 22,121 48.80 24.28 303.46 31,680 30,730 77.86 42.63 530.97 227.52 2037 23,285 22,121 48.80 24.28 327.73 31,680 30,730 77.86 42.63 573.61 245.87 2038 23,285 22,121 48.80 24.28 352.01 31,680 30,730 77.86 42.63 616.24 264.23 2039 23,285 22,121 48.80 24.28 376.28 31,680 30,730 77.86 42.63 658.87 282.59 2040 23,285 22,121 48.80 24.28 400.56 31,680 30,730 77.86 42.63 701.50 300.94 2041 23,285 22,121 48.80 24.28 424.84 31,680 30,730 77.86 42.63 744.14 319.30 2042 23,285 22,121 48.80 24.28 449.11 31,680 30,730 77.86 42.63 786.77 337.66 2043 23,285 22,121 48.80 24.28 473.39 31,680 30,730 77.86 42.63 829.40 356.01 2044 23,285 22,121 48.80 24.28 497.67 31,680 30,730 77.86 42.63 872.03 374.37

Total 477,338 453,471 1,000.50 497.67 5,352.95 649,443 629,960 1,596.22 872.03 9,359.84 4,006.89 Assumptions:Employment rate of migrant workers (without project) = 95%Employment rate of migrant workers (with project) = 97%Wage of migrant worker ($/year; economic; without project) = 2,206 Wage of migrant worker ($/year; economic; with project) = 2,534 Incremental wage of employed migrant worker ($/year) = 328 Remittance as % of earnings (without project) = 50%Remittance as % of earnings (with project) = 55%Number of remittances made each year = 4 Cost per remittance ($ per remittance) = 2.85 Note:Under the "without project" scenario, migrant workers availing of pre-departure services (PDS) in service centers are assumed to be unskilled while thoseavailing of PDS under "with project" scenario are skilled.

With ProjectWithout Project Incremental Remittance of Migrant Workers

with 5-day Pre-

departure Orientation (Economic)

14

44. Incremental economic benefits accruing to migrant workers who had taken the five-day PDO and found employment abroad were calculated by estimating the difference between the economic value of remittances made by employed migrant workers (who have taken the PDO) under the “with project” and “without project” situations. Incremental remittances by employed migrant workers who completed the PDO was estimated at $4,006.89 million (Table 3). Incremental economic benefits accruing to migrant workers who had undergone a short-term pre-departure training for improving construction skills and found employment in Russia were calculated by estimating the difference between the economic value of remittances made by employed migrant workers (who completed short-term PDT) under “with project” and “without project” situations. Incremental remittances by employed migrant workers who took the short-term pre-departure training were estimated at $368.18 million (Table 4). Total incremental remittances made by migrant workers (i.e., those who have taken PDO and PDT) were estimated at $4,375.07 million over the period, 2024-2044.

Table 4: Benefits from Remittances of Migrant Workers with Pre-departure Training

Year

Number of Construction

Migrant Workers with Pre-departure

Training

Number of Construction

Migrant Workers with Pre-departure

Training Finding

Employment Abroad

Annual Income of

Construction Migrant

Workers with Pre-

departure Training

(Economic)

Annual Remittance of Construction

Migrant Workers with

Pre-departure Training

(Economic)

Cumulative Remittance of Construction

Migrant Workers with

Pre-departure Training

(Economic)

Number of Construction

Migrant Workers with Pre-departure

Training

Number of Construction

Migrant Workers with Pre-departure

Training Finding

Employment Abroad

Annual Income of

Construction Migrant

Workers with Pre-

departure Training

(Economic)

Annual Remittance of Construction

Migrant Workers with

Pre-departure Training

(Economic)

Cumulative Remittance of Construction

Migrant Workers with

Pre-departure Training

(Economic)(Migrant

Workers/Year)(Migrant

Workers/Year) ($ million) ($ million) ($ million)(Migrant

Workers/Year)(Migrant

Workers/Year) ($ million) ($ million) ($ million) ($ million)20202021202220232024 1,294 1,229 2.24 1.11 1.11 1,760 1,707 3.57 1.78 1.78 0.67 2025 2,587 2,458 4.47 2.22 3.33 3,520 3,414 7.15 3.91 5.69 2.35 2026 2,587 2,458 4.47 2.22 5.56 3,520 3,414 7.15 3.91 9.60 4.04 2027 2,587 2,458 4.47 2.22 7.78 3,520 3,414 7.15 3.91 13.51 5.73 2028 2,587 2,458 4.47 2.22 10.00 3,520 3,414 7.15 3.91 17.42 7.41 2029 2,587 2,458 4.47 2.22 12.23 3,520 3,414 7.15 3.91 21.32 9.10 2030 2,587 2,458 4.47 2.22 14.45 3,520 3,414 7.15 3.91 25.23 10.79 2031 2,587 2,458 4.47 2.22 16.67 3,520 3,414 7.15 3.91 29.14 12.47 2032 2,587 2,458 4.47 2.22 18.89 3,520 3,414 7.15 3.91 33.05 14.16 2033 2,587 2,458 4.47 2.22 21.12 3,520 3,414 7.15 3.91 36.96 15.85 2034 2,587 2,458 4.47 2.22 23.34 3,520 3,414 7.15 3.91 40.87 17.53 2035 2,587 2,458 4.47 2.22 25.56 3,520 3,414 7.15 3.91 44.78 19.22 2036 2,587 2,458 4.47 2.22 27.79 3,520 3,414 7.15 3.91 48.69 20.91 2037 2,587 2,458 4.47 2.22 30.01 3,520 3,414 7.15 3.91 52.60 22.59 2038 2,587 2,458 4.47 2.22 32.23 3,520 3,414 7.15 3.91 56.51 24.28 2039 2,587 2,458 4.47 2.22 34.45 3,520 3,414 7.15 3.91 60.42 25.97 2040 2,587 2,458 4.47 2.22 36.68 3,520 3,414 7.15 3.91 64.33 27.65 2041 2,587 2,458 4.47 2.22 38.90 3,520 3,414 7.15 3.91 68.24 29.34 2042 2,587 2,458 4.47 2.22 41.12 3,520 3,414 7.15 3.91 72.15 31.03 2043 2,587 2,458 4.47 2.22 43.35 3,520 3,414 7.15 3.91 76.06 32.71 2044 2,587 2,458 4.47 2.22 45.57 3,520 3,414 7.15 3.91 79.97 34.40

Total 53,038 50,386 91.71 45.57 490.15 72,160 69,996 146.52 79.97 858.33 368.18 Assumptions:Employment rate of migrant workers (without project) = 95%Employment rate of migrant workers (with project) = 97%Wage of migrant worker ($/year; economic; without project) = 1,820 Wage of migrant worker ($/year; economic; with project) = 2,093 Incremental wage of employed migrant worker ($/year) = 273 Remittance as % of earnings (without project) = 50%Remittance as % of earnings (with project) = 55%Number of remittances made each year = 4 Cost per remittance ($ per remittance) = 2.85 Note:Under the "without project" scenario, migrant workers availing of pre-departure services (PDS) in service centers are assumed to be unskilled while those

Without Project With ProjectIncremental

Remittance of Construction

Migrant Workers with

Pre-departure Training

(Economic)

15

4. Quantification of Benefits from Improved Income-generating Capacity of Job Center Graduates

45. Incremental number of job center graduates. The project is expected to produce an additional 2,544 training graduates (or new skilled workers) per year, who successfully complete the training courses at the job centers, compared with 763 graduates per year under the “without project” situation, or an incremental number of 1,781 graduates every year from 2025- 2044. Over the period, 2024-2044, the cumulative incremental number of job center graduates due to the project was estimated at 36,506. This is broken down as follows: (i) graduates with skills in tourism jobs: 21,238; (ii) graduates with skills in agricultural activities: 8,380; and (iii) graduates with skills in the energy sector: 6,888 (Table 5).

Table 5: Projected Incremental Number of Job Center Graduates

46. Incremental number of employed job center graduates. These new graduates are envisioned to have acquired better skills derived from improved skills enhancement training at job centers and will successfully join the county’s workforce, seek employment, and receive higher wages. Of the total 36,506 job center graduates, 22,425 graduates are expected to find employment, broken down as follow: (i) tourism: 13,046; (ii) agriculture: 5,148; and energy: 4,231 (Table 6).

Tourism Agriculture Energy Total Tourism Agriculture Energy Total Tourism Agriculture Energy Total(Trainees) (Trainees) (Trainees) (Trainees) (Trainees) (Trainees) (Trainees) (Trainees) (Graduates) (Graduates) (Graduates) (Graduates)

20202021202220232024 222 88 72 382 740 292 240 1,272 518 204 168 890 2025 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2026 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2027 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2028 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2029 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2030 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2031 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2032 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2033 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2034 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2035 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2036 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2037 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2038 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2039 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2040 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2041 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2042 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2043 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 2044 444 175 144 763 1,480 584 480 2,544 1,036 409 336 1,781 Total 9,102 3,592 2,952 15,646 30,340 11,972 9,840 52,152 21,238 8,380 6,888 36,506

Incremental Number of Trainees who Completed the Training CourseYear

With ProjectWithout Project

Number of Trainees Number of Trainees

16

Table 6: Projected Employed Job Center Graduates

47. Economic benefits from improved income-earning capacity of job center graduates. The economic benefits (or annual economic earnings) generated were estimated based on the number of job center graduates who are assumed to successfully find employment multiplied by the average annual wage earnings of a skilled worker and adjusting the resulting value by an SCF of 0.90 for both “without project” and “with project” situations. Incremental economic benefits accruing to job centers were calculated by estimating the difference between the economic benefits generated by employed job center graduates under “with project” and “without project” situations. Annual income generated by employed job center graduates in the three economic sectors, from finding employment under the “with project” situation is envisioned to generate an annual incremental income of $1.04 million, $0.16 million, and $0.48 million from tourism, agriculture, and energy, respectively, for a total annual incremental income of $1.67 million, starting in 2025 till 2044. Incremental income is expected to increase from $0.84 million to $34.29 million over the period, 2024-2044.30 Total cumulative incremental income (economic benefits) is estimated at $368.84 million (Table 7).

30 Of the $34.34 million incremental income generated by employed job center graduates, about $10.01 million (or

about 29.2%) are attributed to women graduates.

Tourism Agriculture Energy Total Tourism Agriculture Energy Total Tourism Agriculture Energy Total(Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates) (Graduates)

20202021202220232024 89 35 29 153 407 161 132 700 318 126 103 547 2025 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2026 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2027 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2028 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2029 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2030 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2031 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2032 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2033 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2034 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2035 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2036 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2037 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2038 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2039 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2040 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2041 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2042 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2043 178 70 58 305 814 321 264 1,399 636 251 206 1,094 2044 178 70 58 305 814 321 264 1,399 636 251 206 1,094 Total 3,641 1,437 1,181 6,258 16,687 6,585 5,412 28,684 13,046 5,148 4,231 22,425

a "Without project" employment rate 40%b "With project" employment rate 55%

YearWithout Project With Project Incremental Number of Employed Job Center

GraduatesNumber of Employed Job Center Graduatesa Number of Employed Job Center Graduatesb

Skills and Employability Enhancement Project (RRP TAJ 51011)

Table 7: Economic Benefits from Incremental Income of Job Center Training Graduates

5. Valuation of Costs

48. Investment cost. Project investment costs are at constant 2019 prices and measured using the world price numeraire method. Local cost components, such as non-traded and labor cost components, were converted into economic values applying an SCF of 0.9. Foreign cost components are mainly traded components, and their financial values were assumed to be equal to their respective economic values. The total financial capital investment cost is at $34.65 million, from which all price contingencies of $2.59 million were excluded.31 The resulting financial value of $32.06 million served as basis for arriving at an economic investment cost of about $30.06 million spread over seven years.

31 Obtained from detailed cost tables.

Tourism Agriculture Energy Total Tourism Agriculture Energy Total Tourism Agriculture Energy Total Incremental

($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)20202021202220232024 0.13 0.02 0.06 0.21 0.65 0.10 0.30 1.04 0.52 0.08 0.24 0.84 0.84 2025 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 2.51 2026 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 4.18 2027 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 5.85 2028 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 7.53 2029 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 9.20 2030 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 10.87 2031 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 12.55 2032 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 14.22 2033 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 15.89 2034 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 17.56 2035 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 19.24 2036 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 20.91 2037 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 22.58 2038 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 24.26 2039 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 25.93 2040 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 27.60 2041 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 29.27 2042 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 30.95 2043 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 32.62 2044 0.26 0.04 0.12 0.41 1.29 0.20 0.59 2.09 1.04 0.16 0.48 1.67 34.29 Total 5.26 0.81 2.41 8.48 26.50 4.11 12.16 42.78 21.25 3.29 9.75 34.29 368.84

a "Without project" wage/year:Tourism 1,604 $/yearAgriculture 630 $/yearEnergy 2,270 $/year

b "With project" wage/year:Tourism 1,765 $/yearAgriculture 693 $/yearEnergy 2,497 $/year

Standard conversion fact 0.9

Cumulative Economic

IncomeYear

Without Project With ProjectIncremental Economic Imcome of Employed

Job Center GraduatesProjected Economic Income of Employed Job Center Graduates

Projected Economic Income of Employed Job Center Graduates

18

49. Periodic capital cost. Periodic capital cost, amounting to $2.16 million, is projected to be incurred every ten years, mainly to replace some equipment starting in 2033.

50. Incremental annual recurrent cost. Incremental recurrent cost for each service center and job center is based on the estimated annual cost of operating each of these centers based on the ADB TRTA consultants’ estimates with concurrence from the government (Table 8).

Table 8: Recurrent Cost of Migration Service and Job Centers

51. Foregone earnings of migrant workers. The value of foregone financial wage earnings of migrant workers, had they worked in Tajikistan instead of working overseas, was estimated at about $1,929/migrant worker/year and $1,787/migrant worker/year for “with project” and “without project” situation, respectively. The projected foregone earnings of migrant workers are presented in Table 9.

Year Number of Service Centers

Recurrent Cost of All 4 Service Centers

Recurrent Cost of All 4

Service Centers

(Financial)

Recurrent Cost of All 4

Service Centers

(Economic)a

Number of Job

Centers

Recurrent Cost of All 3 Job Centers

Recurrent Cost of All 3 Job Centers (Financial)

Recurrent Cost of All 3 Job Centers (Economic)a

($) ($ million) ($ million) ($) ($ million) ($ million)20202021202220232024 4 91,585 0.09 0.08 3 162,899 0.16 0.15 2025 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2026 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2027 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2028 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2029 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2030 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2031 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2032 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2033 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2034 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2035 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2036 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2037 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2038 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2039 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2040 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2041 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2042 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2043 4 183,169 0.18 0.16 3 325,797 0.33 0.29 2044 4 183,169 0.18 0.16 3 325,797 0.33 0.29

Total 3.38 Total 6.01 Notes: Notes:Total number of service centers = 4 Total number of job centers = 3Annual recurrent cost service centers 183,169 Recurrent cost of job centers 325,797 a Adjusted by SCF = 0.9 a Adjusted by SCF = 0.9

Recurrent Cost of Service Centers Recurrent Cost of Job Centers

19

Table 9: Projected Foregone Earnings of Migrant Workers

52. Incremental pre-departure cost of migrant workers. Pre-departure costs refer to the typical costs incurred by migrant workers, such as cost of international travel, passport application, contract signing with employer, domestic transportation, other fees, language training, recruitment fees, skills certificate, and visa application. Total pre-departure cost was estimated at $942/migrant worker.32 The projected incremental pre-departure and pre-employment costs of migrant workers are presented in Table 10.

32 Japan International Cooperation Agency. 2018. Migration, Living Conditions and Skills: Panel Study – Tajikistan

(unpublished).

Year

Number of Migrant Workers Finding

Employment Abroad

Annual Earnings of a

Migrant Worker

Working in Tajikistan

(Economic)

Total Annual Foregone

Earnings of Migrant Workers

Had They Worked in Tajikistan

(Economic)a

Cumulative Annual

Foregone Earnings of

Migrant Workers Had

They Worked in Tajikistan

Number of Migrant Workers Finding

Employment Abroad

Annual Earnings of a

Migrant Worker

Working in Tajikistan

(Economic)

Total Annual Foregone

Earnings of Migrant

Workers Had They Worked in

Tajikistan (Economic)a

Cumulative Annual

Foregone Earnings of

Migrant Workers Had

They Worked in Tajikistan

(Migrant Workers/Year)

($/Migrant Worker/Year) ($ million) ($ million)

(Migrant Workers/Year)

($/Migrant Worker/Year) ($ million) ($ million) ($ million)

20202021 - 202220232024 12,936 1,608 20.80 20.80 17,600 1,736 30.56 30.56 9.76 2025 25,872 1,608 41.60 62.40 35,200 1,736 61.11 91.67 29.27 2026 25,872 1,608 41.60 104.00 35,200 1,736 61.11 152.78 48.78 2027 25,872 1,608 41.60 145.61 35,200 1,736 61.11 213.89 68.29 2028 25,872 1,608 41.60 187.21 35,200 1,736 61.11 275.00 87.80 2029 25,872 1,608 41.60 228.81 35,200 1,736 61.11 336.12 107.31 2030 25,872 1,608 41.60 270.41 35,200 1,736 61.11 397.23 126.82 2031 25,872 1,608 41.60 312.01 35,200 1,736 61.11 458.34 146.33 2032 25,872 1,608 41.60 353.61 35,200 1,736 61.11 519.45 165.84 2033 25,872 1,608 41.60 395.22 35,200 1,736 61.11 580.56 185.35 2034 25,872 1,608 41.60 436.82 35,200 1,736 61.11 641.68 204.86 2035 25,872 1,608 41.60 478.42 35,200 1,736 61.11 702.79 224.37 2036 25,872 1,608 41.60 520.02 35,200 1,736 61.11 763.90 243.88 2037 25,872 1,608 41.60 561.62 35,200 1,736 61.11 825.01 263.39 2038 25,872 1,608 41.60 603.22 35,200 1,736 61.11 886.13 282.90 2039 25,872 1,608 41.60 644.83 35,200 1,736 61.11 947.24 302.41 2040 25,872 1,608 41.60 686.43 35,200 1,736 61.11 1,008.35 321.92 2041 25,872 1,608 41.60 728.03 35,200 1,736 61.11 1,069.46 341.43 2042 25,872 1,608 41.60 769.63 35,200 1,736 61.11 1,130.57 360.94 2043 25,872 1,608 41.60 811.23 35,200 1,736 61.11 1,191.69 380.45 2044 25,872 1,608 41.60 852.83 35,200 1,736 61.11 1,252.80 399.96

Total 530,376 852.83 9,173.17 721,603 1,252.80 13,475.21 4,302.04 Earning (financial) of migrant worker ($/year; without project) = 1,787 Earning (financial) of migrant worker ($/year; with project) = 1,929 Earning (economic) of migrant worker ($/year; without project) = 1,608 Earning (economic) of migrant worker ($/year; with project) = 1,736 a Financial direct cost adjusted by SCF = 0.9

Without Project With ProjectIncremental Foregone

Annual Earnings of

Migrant Workers

(Economic)

20

Table 10: Projected Pre-departure Cost of Migrant Workers

53. Incremental annual direct cost of job center trainees. The direct cost of trainees in job centers refers to the typical expenditures (i.e., food, transportation, and other training-related expenses) incurred by trainees while undergoing training. The direct cost per trainee was estimated at $629/trainee/year. The projected incremental annual direct cost of job center trainees is presented in Table 11.

Year

Number of Migrant Workers

Served by Service Centers Finding

Employment Abroad

Pre-departure Cost per Migrant Worker

(Financial)

Total Annual Pre-

departure Cost of Migrant

Workers (Financial)

Total Annual Pre-

departure Cost

Migrant Workers

(Economic)a

Number of Migrant Workers

Served by Service Centers Finding

Employment Abroad

Pre-departure Cost per Migrant Worker

(Financial)

Total Annual Pre-

departure Cost of Migrant

Workers (Financial)

Total Annual Pre-departure

Cost Migrant Workers

(Economic)a

(Migrant Workers/Year)

($/Migrant Worker) ($ million) ($ million)

(Migrant Workers/Year)

($/Migrant Worker) ($ million) ($ million) ($ million)

20202021202220232024 12,936 942 12.19 10.97 17,600 942 16.59 14.93 3.96 2025 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2026 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2027 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2028 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2029 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2030 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2031 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2032 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2033 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2034 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2035 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2036 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2037 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2038 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2039 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2040 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2041 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2042 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2043 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91 2044 25,872 942 24.38 21.94 35,200 942 33.17 29.86 7.91

Total 530,376 499.85 449.86 721,603 680.07 612.06 162.20 a Adjusted by SCF = 0.9Notes:Pre-departure cost ($/worker) = 942

Without Project With Project

Incremental Pre-

departure Cost of Migrant Workers

(Economic)

21

Table 11: Projected Incremental Direct Cost of Job Center Trainees

54. Incremental opportunity cost of job center trainees. The value of the foregone financial wage earnings or opportunity cost of job center trainees undertaking training in tourism, agriculture, and energy courses was based on the lowest annual wage rate for unskilled workers observed in the tourism, agriculture, and energy sectors: tourism – $1,604/trainee/year; agriculture – $630/trainee/year; and energy – $2,270/trainee/year. The opportunity cost of one job center trainee was estimated at 50% of the lowest annual wage for tourism, agriculture, and energy since job center trainees are expected to enroll in short-term courses lasting up to six months. The resulting value represents the wage earnings of a job center trainee over a six-month period had he/she not enrolled in a training course. The opportunity cost estimated for the "with project" scenario was the same as that of the "without project" situation. The projected incremental economic opportunity cost of job center trainees is presented in Table 12.

Tourism Agriculture Energy Total Tourism Agriculture Energy Total Tourism Agriculture Energy Total($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

20202021202220232024 0.05 0.02 0.02 0.09 0.23 0.09 0.07 0.40 0.18 0.07 0.06 0.31 2025 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2026 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2027 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2028 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2029 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2030 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2031 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2032 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2033 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2034 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2035 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2036 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2037 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2038 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2039 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2040 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2041 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2042 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2043 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 2044 0.10 0.04 0.03 0.17 0.46 0.18 0.15 0.79 0.36 0.14 0.12 0.62 Total 2.06 0.81 0.67 3.54 9.45 3.73 3.06 16.24 7.39 2.91 2.40 12.70

a "Without project" direct cost/year:Tourism 629 $/yearAgriculture 629 $/yearEnergy 629 $/year

b "With project" direct cost/year:Tourism 629 $/yearAgriculture 629 $/yearEnergy 629 $/year

Standard conversion fact 0.9

YearWithout Project With Project Incremental Direct Cost of Job Center

Trainees

22

Table 12: Projected Incremental Opportunity Cost of Job Center Trainees

6. Calculation of Economic Internal Rate of Return (EIRR) and Net Present Value (NPV)

55. EIRR calculation. The project, through the implementation of various interrelated interventions, will be able to effectively and efficiently utilize the invested non-financial and financial resources as it is expected to realize an EIRR of 11.5% at a discount rate of 9%.33 The project will likewise generate an NPV of $12.8 million over the 25-year project life. The project is deemed efficient as the project benefit-cost ratio (BCR) is 1.6 (Table 13).

33 According to the ADB Guidelines for the Economic Analysis of Projects (2017), a lower discount rate ranging from

6% to 9% can be applied as the minimum required EIRR for social sector projects. Application of a lower social discount rate to these projects is justified on the ground that social sector projects and poverty-targeting projects often have many unquantifiable benefits.

Tourism Agriculture Energy Total Tourism Agriculture Energy Total Tourism Agriculture Energy Total($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

20202021202220232024 0.06 0.01 0.03 0.10 0.29 0.05 0.13 0.47 0.23 0.04 0.11 0.37 2025 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2026 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2027 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2028 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2029 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2030 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2031 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2032 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2033 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2034 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2035 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2036 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2037 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2038 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2039 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2040 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2041 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2042 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2043 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 2044 0.13 0.02 0.06 0.21 0.59 0.09 0.27 0.95 0.46 0.07 0.21 0.74 Total 2.63 0.41 1.21 4.24 12.05 1.87 5.53 19.44 9.42 1.46 4.32 15.20

a "Without project" opportunity cost/year:Tourism 802 $/yearAgriculture 315 $/yearEnergy 1,135 $/year

b "With project" opportunity cost/year:Tourism 802 $/yearAgriculture 315 $/yearEnergy 1,135 $/year

Standard conversion fact 0.9Note: Since trainees are expected to enroll in short-term training courses (at most 6 months) the opportunity cost of one TVET trainee is

estimated at 50% of the annual wage for tourism, agriculture, and energy under the "without project" situation. The opportunity cost estimated for "with project" situation is the same as that of the "without project" situation.

YearWithout Project With Project Incremental Opportunity Cost of Job Center

Trainees

23

Table 13: Calculation of Project EIRR

L. Sensitivity Analysis

56. The sensitivity analysis indicates that the EIRR is sensitive (i.e., sensitivity indicator [SI] >1) to separate individual changes in project cost, number of migrant workers, and job center enrollees/graduates as the estimated SI for each change variable is either greater than or close to 1. The EIRR is most sensitive to: (i) a change in migrant workers (SI=1.4); (ii) change in job center graduates (SI=1.2); (iii) simultaneous change in migrant workers and job center graduates (SI=1.4); (iv) simultaneous change in project cost, migrant workers, and job center graduates (SI=1.9); and (v) change in wage earnings of job center graduates (SI=1.3) (Table 14).

57. The switching value analysis supports the findings of the sensitivity analysis as it indicates that the project EIRR will remain at the acceptable economically viable level despite significant changes in the change variables. For example, the EIRR remains economically viable (i.e., EIRR = 9%) despite: (i) 54% increase in project costs; (ii) 15% decrease in the number of migrant workers availing of pre-departure services; (iii) 17% decrease in number of job center trainees undergoing training; (iv) 15% simultaneous decrease in the number of migrant workers and job center trainees; (v) 12% simultaneous increase in project cost and decrease in number of migrant workers and job center trainees; (vi) 15% decrease in remittances made by migrant workers; and (vii) 17% decrease in wage earnings of employed

Remittance of Migrant Workers

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 0.39 (0.39) 2021 1.15 1.15 (1.15) 2022 5.15 5.15 (5.15) 2023 5.38 5.38 (5.38) 2024 12.18 0.08 0.15 3.96 0.31 16.67 (1.85) 0.47 (1.38) (18.06) 2025 5.00 0.16 0.29 7.91 0.62 13.99 (1.32) 1.77 0.45 (13.53) 2026 0.81 0.16 0.29 7.91 0.62 9.80 (0.78) 3.44 2.66 (7.15) 2027 0.16 0.29 7.91 0.62 8.99 (0.25) 5.11 4.86 (4.13) 2028 0.16 0.29 7.91 0.62 8.99 0.28 6.79 7.07 (1.92) 2029 0.16 0.29 7.91 0.62 8.99 0.81 8.46 9.27 0.28 2030 0.16 0.29 7.91 0.62 8.99 1.35 10.13 11.48 2.49 2031 0.16 0.29 7.91 0.62 8.99 1.88 11.80 13.68 4.69 2032 0.16 0.29 7.91 0.62 8.99 2.41 13.48 15.89 6.90 2033 1.94 0.16 0.29 7.91 0.62 10.93 2.94 15.15 18.09 7.16 2034 0.16 0.29 7.91 0.62 8.99 3.48 16.82 20.30 11.31 2035 0.16 0.29 7.91 0.62 8.99 4.01 18.50 22.51 13.52 2036 0.16 0.29 7.91 0.62 8.99 4.54 20.17 24.71 15.72 2037 0.16 0.29 7.91 0.62 8.99 5.08 21.84 26.92 17.93 2038 0.16 0.29 7.91 0.62 8.99 5.61 23.51 29.12 20.13 2039 0.16 0.29 7.91 0.62 8.99 6.14 25.19 31.33 22.34 2040 0.16 0.29 7.91 0.62 8.99 6.67 26.86 33.53 24.54 2041 0.16 0.29 7.91 0.62 8.99 7.21 28.53 35.74 26.75 2042 0.16 0.29 7.91 0.62 8.99 7.74 30.20 37.94 28.95 2043 1.94 0.16 0.29 7.91 0.62 10.93 8.27 31.88 40.15 29.22 2044 0.16 0.29 7.91 0.62 8.99 8.80 33.55 42.35 33.37

EIRR = 11.5%12.8

Benefit-cost ratio (BCR) = 1.6

Income of Employed

Job Center Graduates

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Total Cost

Recurrent Cost of Job

Centers

Net present value (NPV @9%) ($ million) =

Net BenefitsYear

Incremental CostTotal

BenefitsTotal

Project Cost

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of

Job Center

Trainees

Incremental Benefits

24

job center graduates. A delay of one year in project implementation will result in an EIRR of about 9.1% (Table 14).

Table 14: Results of the Sensitivity Analysis

M. Benefit Distribution Analysis 58. Benefit distribution analysis is based on the assumption that the clients of migration service centers and job centers mainly come from poor households. The analysis is, therefore, carried out to determine how the benefits generated by the project are distributed among the poor households, i.e., “near poor”, “poor”, and “very poor”. “Near poor” households refer to those that survive within a budget of $5.50 a day, “poor” households refer to those that survive on $3.20 a day, and “very poor” households refer to those that survive on $1.90 a day.

Table 15: Benefit Distribution Analysis

Percent Change Recalculated Sensitivity Switchingin Variable EIRR Indicator Value

1 Increase in project costs 10% 10.9% 0.5 54%2 Decrease in number of migrant workers 10% 9.9% 1.4 15%3 Decrease in job center enrollees/graduates 10% 10.1% 1.2 17%4 Decrease in number of migrant workers and job center enrollees/graduates 10% 9.8% 1.4 15%5 Increase in costs and decrease in migrant workers and job center enrollees/graduates 10% 9.3% 1.9 12%6 Decrease in remittances made by migrant workers 10% 9.9% 1.4 15%7 Decrease in wage earnings of employed job center graduates 10% 10.0% 1.3 17%8 Delay in benefits by one year 9.1%

Base EIRR = 11.5%Base ENPV @9% = 12.8 $ million

Change Variable

Financial Economic Difference

Present Value ($ million@9%)Net

PresentNet

Present Government Total

(1) (2) (1) -(2)Malea Femalea Maleb Femaleb

Male Household

Headc

Female Household

Headc

Incremental Benefits From 141.67 127.50 14.17 8.56 3.67 - - 0.10 1.84 - 14.17 Improved income-generating capacity potential of job center graduates 122.26 110.04 12.23 8.56 3.67 12.23

Remittance of migrant workers 19.41 17.47 1.94 0.10 1.84 1.94 Incremental Costs 43.44 39.94 3.50 0.94 0.40 - - - 2.16 3.50 Project investment cost 21.79 20.45 1.33 1.33 1.33 Periodic capital expenditure 3.80 3.42 0.38 0.38 0.38 Recurrent cost of service centers 1.62 1.46 0.16 0.16 0.16 Recurrent cost of job centers 2.88 2.59 0.29 0.29 0.29 Direct cost of job center trainees 6.08 5.47 0.61 0.43 0.18 0.61 Opportunity cost of job center trainees 7.28 6.55 0.73 0.51 0.22 0.73 Net Benefits 98.23 87.56 10.67 7.62 3.27 - - 0.10 1.84 (2.16) 10.67 Proportion of near poord 34% 34% 34% 34% 34% 34% 10%Net benefits to the near poor 2.59 1.11 - - 0.03 0.63 (0.22) 4.15 Poverty Impact Ratio 0.39 Proportion of poore 15% 15% 15% 15% 15% 15% 0%Net benefits to the poor 1.14 0.49 - - 0.01 0.28 - 1.92 Poverty Impact Ratio 0.18 Proportion of very poorf 5% 5% 5% 5% 5% 5% 0%Net benefits to the very poor 0.38 0.16 - - 0.00 0.09 - 0.64 Poverty Impact Ratio 0.06 a The project will target 30% of job center clients to be female.b Of the total migrant workers, 95% are male. Sourced from ILO. 2010. Migrant Remittances to Tajikistan . Geneva. c About 95% of households receiving remittances are assumed to be headed by women.d "Near poor" poverty incidence is calculated as follows: Poverty headcount ratio at $5.50 a day at 2011 PPP (54%) minus poverty headcount at $3.20 a day at 2011 PPP (20%) equals 34%.World Bank.e "Poor" poverty incidence is calculated as follows: Poverty headcount ratio at $3.20 a day at 2011 PPP (20%) minus poverty headcount at $1.90 a day at 2011 PPP (5%) equals 15%.World Bank.f Poverty incidence among "very poor" is based on poverty headcount ratio at $1.90 a day as of 2015 derived from World Bank.

Distribution of Benefits and CostsJob Center Graduates Migrant Workers Migrant Workers'

Household

25

59. The WB estimated that 5% of the population live on $1.90 a day, while about 20% (including those living on $1.90 a day) survive on $3.20 a day. To estimate the proportion of the population considered as “poor”, the difference between the percentage of households surviving on $3.20 a day (20%) and those surviving on $1.90 a day (5%) was calculated to arrive at 15% as the percentage of the poor population living above $1.90 a day but below $3.20 a day. To estimate the proportion of the population considered as “near poor”, the difference between the percentage of households surviving on $5.50 a day (54%) and those surviving on $3.20 a day (20% as estimated by WB) was calculated to arrive at 34% as the percentage of the “near poor” population living above $3.20 a day but within $5.50 a day (Table 15). 60. Benefits and costs were distributed among job center graduates (male and female), migrant workers (male and female), migrant workers’ families (male-headed and female-headed households), and government. The distribution analysis indicated that 39% of net benefits are shared by the “near poor” while 18% of net benefits are shared by the “poor”, and about 6% by the “very poor” (Table 15).

26 Annex 1

RESULTS OF THE SENSITIVITY ANALYSIS – OVERALL PROJECT Table A1: Increase in Project Costs by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

BenefitsNet Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.43 - - - - - 0.43 - - - (0.43) 2021 1.26 - - - - - 1.26 - - - (1.26) 2022 5.66 - - - - - 5.66 - - - (5.66) 2023 5.91 - - - - - 5.91 - - - (5.91) 2024 13.40 - 0.09 0.16 3.96 0.31 17.92 (1.85) 0.47 (1.38) (19.30) 2025 5.50 - 0.18 0.32 7.91 0.62 14.53 (1.32) 1.77 0.45 (14.08) 2026 0.90 - 0.18 0.32 7.91 0.62 9.93 (0.78) 3.44 2.66 (7.27) 2027 - - 0.18 0.32 7.91 0.62 9.04 (0.25) 5.11 4.86 (4.17) 2028 - 0.18 0.32 7.91 0.62 9.04 0.28 6.79 7.07 (1.97) 2029 - 0.18 0.32 7.91 0.62 9.04 0.81 8.46 9.27 0.24 2030 - 0.18 0.32 7.91 0.62 9.04 1.35 10.13 11.48 2.44 2031 - 0.18 0.32 7.91 0.62 9.04 1.88 11.80 13.68 4.65 2032 - - 0.18 0.32 7.91 0.62 9.04 2.41 13.48 15.89 6.85 2033 2.14 0.18 0.32 7.91 0.62 11.17 2.94 15.15 18.09 6.92 2034 - 0.18 0.32 7.91 0.62 9.04 3.48 16.82 20.30 11.26 2035 - 0.18 0.32 7.91 0.62 9.04 4.01 18.50 22.51 13.47 2036 - 0.18 0.32 7.91 0.62 9.04 4.54 20.17 24.71 15.68 2037 - - 0.18 0.32 7.91 0.62 9.04 5.08 21.84 26.92 17.88 2038 - 0.18 0.32 7.91 0.62 9.04 5.61 23.51 29.12 20.09 2039 - 0.18 0.32 7.91 0.62 9.04 6.14 25.19 31.33 22.29 2040 - 0.18 0.32 7.91 0.62 9.04 6.67 26.86 33.53 24.50 2041 - 0.18 0.32 7.91 0.62 9.04 7.21 28.53 35.74 26.70 2042 - - 0.18 0.32 7.91 0.62 9.04 7.74 30.20 37.94 28.91 2043 2.14 0.18 0.32 7.91 0.62 11.17 8.27 31.88 40.15 28.98 2044 - 0.18 0.32 7.91 0.62 9.04 8.80 33.55 42.35 33.32

EIRR = 10.9%Net present value (NPV @9%) ($ million) = 10.4

1.1

Incremental Cost Incremental Benefits

27 Annex 1

Table A2: Decrease in Number of Migrant Workers by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - - - (0.39) 2021 1.15 - - - - - 1.15 - - - (1.15) 2022 5.15 - - - - - 5.15 - - - (5.15) 2023 5.38 - - - - - 5.38 - - - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.31 16.67 (1.74) 0.47 (1.27) (17.95) 2025 5.00 - 0.16 0.29 7.91 0.62 13.99 (1.40) 1.77 0.36 (13.62) 2026 0.81 - 0.16 0.29 7.91 0.62 9.80 (1.07) 3.44 2.37 (7.44) 2027 - - 0.16 0.29 7.91 0.62 8.99 (0.74) 5.11 4.37 (4.61) 2028 - 0.16 0.29 7.91 0.62 8.99 (0.41) 6.79 6.38 (2.61) 2029 - 0.16 0.29 7.91 0.62 8.99 (0.07) 8.46 8.39 (0.60) 2030 - 0.16 0.29 7.91 0.62 8.99 0.26 10.13 10.39 1.40 2031 - 0.16 0.29 7.91 0.62 8.99 0.59 11.80 12.40 3.41 2032 - - 0.16 0.29 7.91 0.62 8.99 0.93 13.48 14.40 5.41 2033 1.94 0.16 0.29 7.91 0.62 10.93 1.26 15.15 16.41 5.48 2034 - 0.16 0.29 7.91 0.62 8.99 1.59 16.82 18.42 9.43 2035 - 0.16 0.29 7.91 0.62 8.99 1.93 18.50 20.42 11.43 2036 - 0.16 0.29 7.91 0.62 8.99 2.26 20.17 22.43 13.44 2037 - - 0.16 0.29 7.91 0.62 8.99 2.59 21.84 24.43 15.44 2038 - 0.16 0.29 7.91 0.62 8.99 2.93 23.51 26.44 17.45 2039 - 0.16 0.29 7.91 0.62 8.99 3.26 25.19 28.45 19.46 2040 - 0.16 0.29 7.91 0.62 8.99 3.59 26.86 30.45 21.46 2041 - 0.16 0.29 7.91 0.62 8.99 3.93 28.53 32.46 23.47 2042 - - 0.16 0.29 7.91 0.62 8.99 4.26 30.20 34.46 25.47 2043 1.94 0.16 0.29 7.91 0.62 10.93 4.59 31.88 36.47 25.54 2044 - 0.16 0.29 7.91 0.62 8.99 4.92 33.55 38.47 29.48

EIRR = 9.9%Net present value (NPV @9%) ($ million) = 4.3

1.1

Incremental Cost Incremental Benefits

28 Annex 1

Table A3: Decrease in Job Center Enrollment by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - - - (0.39) 2021 1.15 - - - - - 1.15 - - - (1.15) 2022 5.15 - - - - - 5.15 - - - (5.15) 2023 5.38 - - - - - 5.38 - - - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.28 16.64 (1.85) 0.42 (1.43) (18.07) 2025 5.00 - 0.16 0.29 7.91 0.56 13.92 (1.32) 1.59 0.27 (13.65) 2026 0.81 - 0.16 0.29 7.91 0.56 9.74 (0.78) 3.10 2.31 (7.43) 2027 - - 0.16 0.29 7.91 0.56 8.93 (0.25) 4.60 4.35 (4.58) 2028 - 0.16 0.29 7.91 0.56 8.93 0.28 6.11 6.39 (2.54) 2029 - 0.16 0.29 7.91 0.56 8.93 0.81 7.61 8.43 (0.50) 2030 - 0.16 0.29 7.91 0.56 8.93 1.35 9.12 10.47 1.54 2031 - 0.16 0.29 7.91 0.56 8.93 1.88 10.62 12.50 3.58 2032 - - 0.16 0.29 7.91 0.56 8.93 2.41 12.13 14.54 5.61 2033 1.94 0.16 0.29 7.91 0.56 10.87 2.94 13.63 16.58 5.71 2034 - 0.16 0.29 7.91 0.56 8.93 3.48 15.14 18.62 9.69 2035 - 0.16 0.29 7.91 0.56 8.93 4.01 16.65 20.66 11.73 2036 - 0.16 0.29 7.91 0.56 8.93 4.54 18.15 22.69 13.77 2037 - - 0.16 0.29 7.91 0.56 8.93 5.08 19.66 24.73 15.80 2038 - 0.16 0.29 7.91 0.56 8.93 5.61 21.16 26.77 17.84 2039 - 0.16 0.29 7.91 0.56 8.93 6.14 22.67 28.81 19.88 2040 - 0.16 0.29 7.91 0.56 8.93 6.67 24.17 30.85 21.92 2041 - 0.16 0.29 7.91 0.56 8.93 7.21 25.68 32.89 23.96 2042 - - 0.16 0.29 7.91 0.56 8.93 7.74 27.18 34.92 26.00 2043 1.94 0.16 0.29 7.91 0.56 10.87 8.27 28.69 36.96 26.09 2044 - 0.16 0.29 7.91 0.56 8.93 8.80 30.20 39.00 30.07

EIRR = 10.1%Net present value (NPV @9%) ($ million) = 5.4

1.1

Incremental Cost Incremental Benefits

29 Annex 1

Table A4: Decrease in Number of Migrant Workers and Job Center Enrollment by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - - - (0.39) 2021 1.15 - - - - - 1.15 - - - (1.15) 2022 5.15 - - - - - 5.15 - - - (5.15) 2023 5.38 - - - - - 5.38 - - - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.28 16.64 (1.66) 0.42 (1.25) (17.89) 2025 5.00 - 0.16 0.29 7.91 0.56 13.92 (1.18) 1.59 0.41 (13.52) 2026 0.81 - 0.16 0.29 7.91 0.56 9.74 (0.71) 3.10 2.39 (7.35) 2027 - - 0.16 0.29 7.91 0.56 8.93 (0.23) 4.60 4.38 (4.55) 2028 - - 0.16 0.29 7.91 0.56 8.93 0.25 6.11 6.36 (2.57) 2029 - - 0.16 0.29 7.91 0.56 8.93 0.73 7.61 8.35 (0.58) 2030 - - 0.16 0.29 7.91 0.56 8.93 1.21 9.12 10.33 1.40 2031 - - 0.16 0.29 7.91 0.56 8.93 1.69 10.62 12.32 3.39 2032 - - 0.16 0.29 7.91 0.56 8.93 2.17 12.13 14.30 5.37 2033 - 1.94 0.16 0.29 7.91 0.56 10.87 2.65 13.63 16.29 5.41 2034 - - 0.16 0.29 7.91 0.56 8.93 3.13 15.14 18.27 9.34 2035 - - 0.16 0.29 7.91 0.56 8.93 3.61 16.65 20.26 11.33 2036 - - 0.16 0.29 7.91 0.56 8.93 4.09 18.15 22.24 13.31 2037 - - 0.16 0.29 7.91 0.56 8.93 4.57 19.66 24.22 15.30 2038 - - 0.16 0.29 7.91 0.56 8.93 5.05 21.16 26.21 17.28 2039 - - 0.16 0.29 7.91 0.56 8.93 5.53 22.67 28.19 19.27 2040 - - 0.16 0.29 7.91 0.56 8.93 6.01 24.17 30.18 21.25 2041 - - 0.16 0.29 7.91 0.56 8.93 6.49 25.68 32.16 23.24 2042 - - 0.16 0.29 7.91 0.56 8.93 6.97 27.18 34.15 25.22 2043 - 1.94 0.16 0.29 7.91 0.56 10.87 7.44 28.69 36.13 25.26 2044 - - 0.16 0.29 7.91 0.56 8.93 7.92 30.20 38.12 29.19

EIRR = 9.8%Net present value (NPV @9%) ($ million) = 4.1

1.1

Incremental Cost Incremental Benefits

30 Annex 1

Table A5: Increase in Project Cost and Decrease in Number of Migrant Workers and Job Center Enrolment by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.43 - - - - - 0.43 - - - (0.43) 2021 1.26 - - - - - 1.26 - - - (1.26) 2022 5.66 - - - - - 5.66 - - - (5.66) 2023 5.91 - - - - - 5.91 - - - (5.91) 2024 13.40 - 0.09 0.16 3.96 0.28 17.88 (1.66) 0.42 (1.25) (19.13) 2025 5.50 - 0.18 0.32 7.91 0.56 14.47 (1.18) 1.59 0.41 (14.06) 2026 0.90 - 0.18 0.32 7.91 0.56 9.87 (0.71) 3.10 2.39 (7.48) 2027 - - 0.18 0.32 7.91 0.56 8.97 (0.23) 4.60 4.38 (4.60) 2028 - 0.18 0.32 7.91 0.56 8.97 0.25 6.11 6.36 (2.61) 2029 - 0.18 0.32 7.91 0.56 8.97 0.73 7.61 8.35 (0.63) 2030 - 0.18 0.32 7.91 0.56 8.97 1.21 9.12 10.33 1.36 2031 - 0.18 0.32 7.91 0.56 8.97 1.69 10.62 12.32 3.34 2032 - - 0.18 0.32 7.91 0.56 8.97 2.17 12.13 14.30 5.33 2033 2.14 0.18 0.32 7.91 0.56 11.11 2.65 13.63 16.29 5.17 2034 - 0.18 0.32 7.91 0.56 8.97 3.13 15.14 18.27 9.30 2035 - 0.18 0.32 7.91 0.56 8.97 3.61 16.65 20.26 11.28 2036 - 0.18 0.32 7.91 0.56 8.97 4.09 18.15 22.24 13.27 2037 - - 0.18 0.32 7.91 0.56 8.97 4.57 19.66 24.22 15.25 2038 - 0.18 0.32 7.91 0.56 8.97 5.05 21.16 26.21 17.24 2039 - 0.18 0.32 7.91 0.56 8.97 5.53 22.67 28.19 19.22 2040 - 0.18 0.32 7.91 0.56 8.97 6.01 24.17 30.18 21.21 2041 - 0.18 0.32 7.91 0.56 8.97 6.49 25.68 32.16 23.19 2042 - - 0.18 0.32 7.91 0.56 8.97 6.97 27.18 34.15 25.18 2043 2.14 0.18 0.32 7.91 0.56 11.11 7.44 28.69 36.13 25.02 2044 - 0.18 0.32 7.91 0.56 8.97 7.92 30.20 38.12 29.15

EIRR = 9.3%Net present value (NPV @9%) ($ million) = 1.7

1.0

Incremental Cost Incremental Benefits

31 Annex 1

Table A6: Decrease in Annual Remittances of Migrant Workers by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - - - (0.39) 2021 1.15 - - - - - 1.15 - - - (1.15) 2022 5.15 - - - - - 5.15 - - - (5.15) 2023 5.38 - - - - - 5.38 - - - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.31 16.67 (1.74) 0.47 (1.27) (17.95) 2025 5.00 - 0.16 0.29 7.91 0.62 13.99 (1.40) 1.77 0.36 (13.62) 2026 0.81 - 0.16 0.29 7.91 0.62 9.80 (1.07) 3.44 2.37 (7.44) 2027 - - 0.16 0.29 7.91 0.62 8.99 (0.74) 5.11 4.37 (4.61) 2028 - 0.16 0.29 7.91 0.62 8.99 (0.41) 6.79 6.38 (2.61) 2029 - 0.16 0.29 7.91 0.62 8.99 (0.07) 8.46 8.39 (0.60) 2030 - 0.16 0.29 7.91 0.62 8.99 0.26 10.13 10.39 1.40 2031 - 0.16 0.29 7.91 0.62 8.99 0.59 11.80 12.40 3.41 2032 - - 0.16 0.29 7.91 0.62 8.99 0.93 13.48 14.40 5.41 2033 1.94 0.16 0.29 7.91 0.62 10.93 1.26 15.15 16.41 5.48 2034 - 0.16 0.29 7.91 0.62 8.99 1.59 16.82 18.42 9.43 2035 - 0.16 0.29 7.91 0.62 8.99 1.93 18.50 20.42 11.43 2036 - 0.16 0.29 7.91 0.62 8.99 2.26 20.17 22.43 13.44 2037 - - 0.16 0.29 7.91 0.62 8.99 2.59 21.84 24.43 15.44 2038 - 0.16 0.29 7.91 0.62 8.99 2.93 23.51 26.44 17.45 2039 - 0.16 0.29 7.91 0.62 8.99 3.26 25.19 28.45 19.46 2040 - 0.16 0.29 7.91 0.62 8.99 3.59 26.86 30.45 21.46 2041 - 0.16 0.29 7.91 0.62 8.99 3.93 28.53 32.46 23.47 2042 - - 0.16 0.29 7.91 0.62 8.99 4.26 30.20 34.46 25.47 2043 1.94 0.16 0.29 7.91 0.62 10.93 4.59 31.88 36.47 25.54 2044 - 0.16 0.29 7.91 0.62 8.99 4.92 33.55 38.47 29.48

EIRR = 9.9%Net present value (NPV @9%) ($ million) = 4.3

1.1

Incremental Cost Incremental Benefits

32 Annex 1

Table A7: Decrease in Annual Wage Earnings of Employed Job Center Graduates by 10%

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - - - (0.39) 2021 1.15 - - - - - 1.15 - - - (1.15) 2022 5.15 - - - - - 5.15 - - - (5.15) 2023 5.38 - - - - - 5.38 - - - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.31 16.67 (1.85) 0.42 (1.43) (18.11) 2025 5.00 - 0.16 0.29 7.91 0.62 13.99 (1.32) 1.59 0.27 (13.71) 2026 0.81 - 0.16 0.29 7.91 0.62 9.80 (0.78) 3.10 2.31 (7.49) 2027 - - 0.16 0.29 7.91 0.62 8.99 (0.25) 4.60 4.35 (4.64) 2028 - - 0.16 0.29 7.91 0.62 8.99 0.28 6.11 6.39 (2.60) 2029 - - 0.16 0.29 7.91 0.62 8.99 0.81 7.61 8.43 (0.56) 2030 - - 0.16 0.29 7.91 0.62 8.99 1.35 9.12 10.47 1.48 2031 - - 0.16 0.29 7.91 0.62 8.99 1.88 10.62 12.50 3.51 2032 - - 0.16 0.29 7.91 0.62 8.99 2.41 12.13 14.54 5.55 2033 - 1.94 0.16 0.29 7.91 0.62 10.93 2.94 13.63 16.58 5.65 2034 - - 0.16 0.29 7.91 0.62 8.99 3.48 15.14 18.62 9.63 2035 - - 0.16 0.29 7.91 0.62 8.99 4.01 16.65 20.66 11.67 2036 - - 0.16 0.29 7.91 0.62 8.99 4.54 18.15 22.69 13.70 2037 - - 0.16 0.29 7.91 0.62 8.99 5.08 19.66 24.73 15.74 2038 - - 0.16 0.29 7.91 0.62 8.99 5.61 21.16 26.77 17.78 2039 - - 0.16 0.29 7.91 0.62 8.99 6.14 22.67 28.81 19.82 2040 - - 0.16 0.29 7.91 0.62 8.99 6.67 24.17 30.85 21.86 2041 - - 0.16 0.29 7.91 0.62 8.99 7.21 25.68 32.89 23.90 2042 - - 0.16 0.29 7.91 0.62 8.99 7.74 27.18 34.92 25.93 2043 - 1.94 0.16 0.29 7.91 0.62 10.93 8.27 28.69 36.96 26.03 2044 - - 0.16 0.29 7.91 0.62 8.99 8.80 30.20 39.00 30.01

EIRR = 10.0%Net present value (NPV @9%) ($ million) = 5.00

1.06

Incremental Cost Incremental Benefits

33 Annex 1

Table A8: Delay in Project Benefits by One Year

Year

Total Project Cost

Periodic Capital

Expenditure

Recurrent Cost of Service Centers

Recurrent Cost of Job

Centers

Pre-departure

Orientation Cost of Migrant

Workers

Direct Cost of Job Center

Trainees

Total Cost Remittance of Migrant Workers

Income of Employed

Job Center Graduates

Total Incremental

Benefits Net Benefits

{1} {2} {3} {4} {5} {6} {7} {8} {9} {10} (11) = (10) - (7)($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million) ($ million)

2020 0.39 - - - - - 0.39 - (0.39) 2021 1.15 - - - - - 1.15 - (1.15) 2022 5.15 - - - - - 5.15 - (5.15) 2023 5.38 - - - - - 5.38 - (5.38) 2024 12.18 - 0.08 0.15 3.96 0.31 16.67 - (16.67) 2025 5.00 - 0.16 0.29 7.91 0.62 13.99 (1.85) 0.09 (1.75) (15.74) 2026 0.81 - 0.16 0.29 7.91 0.62 9.80 (1.32) 1.77 0.45 (9.35) 2027 - - 0.16 0.29 7.91 0.62 8.99 (0.78) 3.44 2.66 (6.33) 2028 - 0.16 0.29 7.91 0.62 8.99 (0.25) 5.11 4.86 (4.13) 2029 - 0.16 0.29 7.91 0.62 8.99 0.28 6.79 7.07 (1.92) 2030 - 0.16 0.29 7.91 0.62 8.99 0.81 8.46 9.27 0.28 2031 - 0.16 0.29 7.91 0.62 8.99 1.35 10.13 11.48 2.49 2032 - - 0.16 0.29 7.91 0.62 8.99 1.88 11.80 13.68 4.69 2033 1.94 0.16 0.29 7.91 0.62 10.93 2.41 13.48 15.89 4.96 2034 - 0.16 0.29 7.91 0.62 8.99 2.94 15.15 18.09 9.11 2035 - 0.16 0.29 7.91 0.62 8.99 3.48 16.82 20.30 11.31 2036 - 0.16 0.29 7.91 0.62 8.99 4.01 18.50 22.51 13.52 2037 - - 0.16 0.29 7.91 0.62 8.99 4.54 20.17 24.71 15.72 2038 - 0.16 0.29 7.91 0.62 8.99 5.08 21.84 26.92 17.93 2039 - 0.16 0.29 7.91 0.62 8.99 5.61 23.51 29.12 20.13 2040 - 0.16 0.29 7.91 0.62 8.99 6.14 25.19 31.33 22.34 2041 - 0.16 0.29 7.91 0.62 8.99 6.67 26.86 33.53 24.54 2042 - - 0.16 0.29 7.91 0.62 8.99 7.21 28.53 35.74 26.75 2043 1.94 0.16 0.29 7.91 0.62 10.93 7.74 30.20 37.94 27.01 2044 - 0.16 0.29 7.91 0.62 8.99 8.27 31.88 40.15 31.16

EIRR = 9.1%Net present value (NPV @9%) ($ million) = 0.6

1.0

Incremental Cost Incremental Benefits