AFRICAN DEVELOPMENT FUND

THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

SOUTHEAST RANGELAND DEVELOPMENT PROJECT

PROJECT COMPLETION REPORT

AGRICULTURAL AND RURAL DEVELOPMENT DEPARTMENT NORTH, EAST AND SOUTH REGIONS ONAR

TABLE OF CONTENTS List of Tables and Annexes i - vii Currency, and Abbreviations Basic Project Data Logframe Matrix Executive Summary Page 1. INTRODUCTION 1 2. PROJECT OBJECTIVE AND FORMULATION 2 2.1 Project Objective 2 2.2 Project Description 2 2.3 Project Origin and Formulation 4 3. PROJECT EXECUTION 4 3.1 Effectiveness and Start-up 4 3.2 Modifications 5 3.3 Implementation Schedule 7 3.4 Reporting 8 3.5 Procurement 8 3.6 Financial Sources and Disbursement 9 4. PROJECT PERFORMANCE 9 4.1 Overall Assessment 9 4.2 Operational Performance 10 4.3 Institutional Performance 14 4.4 Management and Organisation Effectiveness 15 4.5 Staff Recruitment, Training and Development 15 4.6 Performance of Contractors, Consultants and Suppliers 16 4.7 Management Consultants 16 4.8 Conditions/ Covenants 17 5. FINANCIAL PERFORMANCE 17 6. SOCIAL AND ENVIRONMENTAL IMPACT 17 6.1 Social Impact 17 6.2 Environmental Impact 18 7. PROJECT SUSTAINABILITY 18 8. PERFORMANCE OF THE BANK AND THE BORROWER 18 8.1 Performance of the Bank 18 8.2 Performance of the Borrower 19 9. OVERALL PERFORMANCE AND RATING 20 10. CONCLUSIONS, LESSONS LEARNT ANDRECOMMENDATIONS 20 10.1 Conclusions 20 10.2 Recommendations 10.3 Lessons Learnt 21

This report was prepared by Mrs. M.W. Karuri, Principal Financial Analyst (Mission Leader) and Mr Chi L.Tawah, Senior Livestock Officer and Mr A. Eskendir, Engineer, Ethiopia Country Office (ETCO) following their mission to Ethiopia . Enquiries should be directed to Mr. L. I. Umeh, Manager ONAR.1 (Ext. 4133) or the authors on Ext. 4689.

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CURRENCY EQUIVALENT

1989 December 2001

1 FUA = 2.56568 ETB N/A 1 UA = 2.3604 ETB 10.5444 ETB

LIST OF TABLES

Table - Sources of Financing

LIST OF ANNEXES:

1 - Map of Ethiopia showing the Project area 2 - Actual Cost and Financing by category of expenditure and/or by component 3 - Yearly disbursement by Source of Funds 4 - Performance Evaluation and Rating 5 - Matrix of Recommendations and Follow-up action 6 - Borrowers PCR 7 - Sources of Information

BASIC PROJECT DATA

1. Loan Number - F/ETH/AGR/89/27 2. Borrower - The Democratic Republic of Ethiopia 3. Guarantor - The Democratic Republic of Ethiopia 4. Beneficiary - Pastaralist and agro-pastaralist Communities in the

Somali Region 5. Executing Agency - Ministry of Agriculture

A. LOAN APPRAISAL ACTUAL ESTIMATE Amount (UA) UA 23.45 million UA 18.3 million Interest Rate 0.75% per annum on the amount disbursed and outstanding Repayment Period 50 Years including Grace Period 10 Years Grace period Date Approved 23/08/1989 Date Signed 01/12/89 Date of Entry Into Force 20/10/90 Closing Date 31/12/2000 B. PROJECT DATA 1. Total Cost (UA/Million) Appraisal Estimate Actual UA 29.45 Million UA 29.45 Million UA 24.30 million 2. Financing Plan (UA/Million) Appraisal Estimate Actual ADF 23.45 18.30 Government 6.00 6.00 TOTAL 29.45 24.30

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Effective Date of First Disbursement - 12/10/1990 Effective Date of Last Disbursement - 18/08/2000 Commencement of Project Implementation Activities - 1990

Date of Completion of Project Implementation Activities - 2000 C. PERFORMANCE INDICATORS 1. Cost under run - UA 5.15 2. Time overrun - 5 years - Slippage on Effectiveness - 8 Months - Slippage of Completion Date - 5Years - Slippage on Last Disbursement - 5 Years - Number of Extensions of Last Disbursement Date - Two Project Implementation Status: Completed/Incomplete - Complete List of verifiable indicators and levels of achievement (expressed as %of planned levels): Institutional Performance: Unsatisfactory Contractors Performance: satisfactory Consultants Performance: satisfactory D. MISSIONS No of Persons Composition Man-days Identification - Not Known Preparation - Consultant - Appraisal - Veterinary officer, Agric. Economist Civil Engineer, Range-Management Specialist & Country Economist 75 Re-appraisal - Veterinary Officer & Agric. Economist Supervision - 1992 - Livestock Officer 10 21 Oct/04 Nov. 1995 - Livestock Officer & Agric. Economist 28 27 May/14 June 1998 - Agric. Economist, Livestock Expert

Civil Engineer 57 7-21 Nov.1999 - Agric. Economist, Livestock Officer &

Financial Analyst 45 13-19 March 2000 - Agric. Economist & Livestock Officer 14 E. DISBURSEMENT APPRAISAL ACTUAL PERCETAGE ESTIMATE DISBURSED Total Disbursement 23.45 18.28 78 Amount Cancelled - 5.17 22 Total 23.45 23.45 100

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Yearly Disbursement in UA Millions: Year Opening Total Amount Un-disbursed Cancellation Balance Disbursed Amount Amount 1/12/1989 23,449,984.00 1,117,896.92 1990 22,332,087.08 218,708.60 1991 22,113,378.48 862,801.61 1992 21,250,576.87 2,083,793.36 1993 19,166,783.51 1,880,765.54 1994 17,286,017.97 1,406,138.61 1995 15,879,879.36 1,149,059.77 1996 14,730,819.59 3,906,773.14 1997 10,824,046.45 1,974,752.30 1998 8,849,294.15 3,025,783.56 1999 5,823,510.59 657, 148.21 2000 5,215,571.55 2001 5,166,362.38 18,283,621.62

F. SUPPLIERS: See attached list Annex: 2 G. CONTRACTORS: See attached Annex list: 2 H. CONSULTANTS: See attached list Annex: 2

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ACRONYMS ADF - African Development Fund ADB - African Development Bank ILCA - Livestock Centre for Africa ICB - International Competitive Bidding JIRDU - Jijiga Rangelands Development Unit LOGs - List of Goods and Services MoA - Ministry of Agriculture NERDU - North-eastern Rangelands Development Unit NCB - National Competitive Bidding PAs - Pastoralist Associations PAHAs - Network of Pastoral Animal Health Assistants PCR - Project Completion Report PMU - Project Management Unit PSC - Project Steering Committee SERP - South East Rangelands Project SORDU - Southern Rangelands Development Unit SMSs - Subject Matter Specialists SCs - Service Cooperatives WEDU - Women’s Extension Development Unit

v RETROSPECTIVE LOGFRAME MATRIX COUNTRY: ETHIOPIA PROJECT NAME: SOUTHEAST RANGELAND DEVELOPMENT PROJECT

Narrative summary (NS)

Objectively Verifiable Indicators (OVI) Means of Verification (MOV)

Assumption /Risk

At Appraisal At implementation At Completion Sector Goal: To raise the living standards of Pastoralist populations.

Increased incomes of Pastoralist populations

Increased incomes of Pastoralist populations

Project Objective Improving productivity of their livestock and ensuring sustainability of their natural resource base.

1. Productivity of

livestock enhanced 2. Sustainability of

natural resource base ensured

1. Productivity of

livestock enhanced 2. Sustainability of

natural resource base ensured

Outputs: 1. Infrastructure 1.1. Road 1.2. Project buildings; development centre, grain store, laboratories, vet clinics, herbarium hall, offices, sheds, garage, staff housing, guest house, livestock market place, shelter for market technicians, loading ramps. 1.3. Water development; birkas, ponds, shallow wells and boreholes construction. 2. Extension and Community Development 2.1 Agricultural inputs distributed 2.2 Agricultural technologies introduced 2.3 Community-based development institutions set-up 2.4 Studies, proposals and reports prepared 2.5 Training and workshops organized 3. Animal Health, Production and

1.1 Road [RR30 -545km, RR10 –1265km], 1.2 Project Buildings: development centre [8 new and 7 rehabilitation], grain store [ 119], laboratories [3], vet clinics [0], herbarium hall[1], offices[2], sheds [2], garage [1],staff housing [91], guest house [1], dormitory [2], livestock market place [no target], shelter for market technicians [no target], loading ramps [no target]. 1.3. Water Development; birkas [40], ponds [50], shallow wells [75], boreholes [2]

2.1 Seedlings (2,052,000); grain/fodder seeds (756); and farm tools (300) 2.2 Biogas plants (2) and micro-projects 769) 2.3 Pastoral ssociations (32); Service coop. (2); Degaan Councils (45); Contact Farmers’ groups (2,014); Women Development Groups (1,232) 2.4 Planned studies (26) and planned proposals & reports (132) 2.5 Home Economics training (819); extension workshops (30); sensitisation workshops (28); study tours (8); field days (2,653) and farm demonstrations (1,403) 3.1 Mobile teams (2)

1.1 Road [RR30 -96km, RR10 –301km], 1.2 Project buildings; development centre [25 new and 11 rehabil.], grain store [ 0], laboratories [2 completed and one 55%], vet clinics [3], herbarium hall [1], offices [1 complet & 1 at 80%], sheds [2], garage [1], staff housing [17], guest house [1], dormitory [2], livestock market place[10 new and 8 improvements],shelter for market technicians [5], loading ramp [5] 1.3 Water development; birkas [19], ponds [42], shallow wells [68], boreholes [1] 2.1 Seedlings (570,237); grain/fodder seeds (756) and farm tools (250) 2.2 Biogas (1) and micro-projects (272) 2.3 Pastoral Associations (5); Service Cooperatives (1); Degaan Councils (37); Contact Farmers’ Groups (1,399); Women Development Groups (789) 2.4 Planned studies (26) and planned proposals & reports (132) 2.5 Home Economics training (434); extension workshops (15); sensitisation workshops (15); study tours (5); field days (486) and farm demonstrations (6,723)

1. Supervision

Mission Reports 2. PCR 3. Project Reports

1. Adequate counter part fund by GOE 2 Recurrent budget by GOE 3 Effective community participation 4.Availability of construction material and skilled manpower in the region 5.Experience of carrying out similar nature of work within the previous projects 6.Collaboration with other government institution and NGO’s 7.Peace and Security in the area 8.Drought and famine

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Marketing 3.1 Mobile field teams set-up 3.2 Livestock diseases brought under control .3.3 Animal husbandry and feeding improved 3.4 Middle-level cadre trained 3.5 Efficient and transparent livestock marketing 4. Land Use and Range Management 4.1 Referenced Herbarium set-up 4.2 Range management technologies developed 4.3 AgroPastoral and water harvesting techniques developed 4.4 Agroforestry techniques developed Activity: 1. Extension and Community Development 2. Animal Health, Production and Marketing 3. Land Use and Range Management 4. Infrastructure Development 5. Management and Administration

Resources: Original Comp. In UA Civil Works - 6.56 m Veh/Mach - 3.60 m Equip/Supp - 4.61 m TA - 1.85 m Train. - 0. 96 m Op. Costs - 4.28 m Horses/carts - 1.34 m Total - 23.45 m

3.2 Vaccinations (11,605,153); sick cases reported (9,696,143) 3.3 Castrations (no targets) 3.4 Lab technicians (no targets); trainers (no targets) and PAHAs (no targets) 3.5 Livestock market reports (33); Livestock movement reports (55); rehabilitated livestock markets (17); construction of new livestock markets (12) 4.1 Herbarium (1) 4.2 Meteorological stations set–up (19); plant seeds collected (8,654); range regeneration enclosures (42) range regeneration demonstrations (18); wind and water erosion control demonstrations (62), (see annex) 4.3 Small-scale irrigation training (NS); water harvesting trials (NS); adaptability trials (44); agroPastoral studies (16); field days (24) (see annex) 4.4 Multipurpose nurseries (6); tree nurseries (7); plant seedlings distributed (2,862,000); vegetable seeds distributed (210,686) (see annex)

3.1 Mobile teams (2) 3.2 Vaccinations (6,037,490); sick cases reported (5,804,990) 3.3 Castrations (21,401) 3.4 Lab technicians (8); trainers (3) and PAHAs (190) 3.5 Livestock market reports (33); Livestock movement reports (55); rehabilitated livestock markets (17); construction of new livestock markets (12) 4.1 Herbarium (1 with 6,500 plant species collected) 4.2 Meteorological stations set–up (3); plant seeds collected (2,600); range regeneration enclosures (8) range regeneration demonstrations (10); wind and water erosion control demonstrations (34), (see annex) 4.3 Small-scale irrigation training (74); water harvesting trials (11); adaptability trials (40); agroPastoral studies (9); field days (15) (see annex) 4.4 Multipurpose nurseries (4); tree nurseries (6); plant seedlings distributed (2,043,136); vegetable seeds distributed (224,796) (see annex) Resources: Actual Expd. Comp. Civil Works - 5.60 m Veh/Mach - 3.72 m Equip/Supp - 4.04 m TA - 1.54 m Train. - 0. 83 m Op. Costs - 2.57 m Horses/carts - 0.00 Total - 18.28

vii EXECUTIVE SUMMARY

1. Introduction: The rangelands of Ethiopia, which cover an area of some 590,000 km2, are mostly found in the central, western and northern parts of the country. The major activity of its inhabitants is nomadic pastoralism although crop cultivation is increasingly becoming important in areas with relatively better rainfall patterns and especially along the seasonal rivers. There is thus a tendency towards settled agropastoralism with the increasing scarcity in grazing land. The rural economy in the rangelands is still highly dependent on livestock production and marketing. 2. The Project: 2.1 Objective: The objective of the Project was to raise the living standards of pastoralist populations in the southeast rangelands of Ethiopia by improving the productivity of their livestock, increased food security while ensuring sustainability of their natural resource base. 2.2 Project Description: The loan agreement between the Bank and the Federal Government of Ethiopia for the loan of UA 23.45 million to fund the SERP was signed on 01/12/1989 and declared effective on 12/10/1990. As at the close of the project in December 2000 a total of UA18.28 million had been disbursed and another UA5.17 million cancelled. The Project objective was to be achieved through the implementation of five major components: i) Extension and Community Development; ii) Animal Health, Production: and marketing; iii) Land Use and Range Management; iv) Infrastructure Development: and v) Project Management and Administration 3. Project Implementation: There was a slippage of 14 months from loan approval to effectiveness. There were delays caused by changes of Government, the project was reformulated twice, and there were delays in the procurement of goods and services. All these culminated in the delays in the implementation of the project. Delays were compounded further by frequent conflicts in the project area and the neighbouring countries of Somalia and Eritrea. The influx of refugees and returnees into the project area, exerted heavy demands on the limited resources of the project, especially project staff time and vehicles, which were frequently mobilised to deliver emergency relief supplies. The sweeping policy and political changes introduced by the new government (1992) had considerable implications (economic, social, financial, institutional, relationships, etc.) on the project and its implementation schedule, resulting in delays in its operational activities, including procurement of goods, works and services. There were frequent changes in management and the project was re-formulated twice (1992 and 1995) causing further delays. 4. Conclusions: Overall, from the assessments carried out by the PCR mission, the project only achieved about 50%-60% of the targeted activities against a disbursement rate of 78%. Failure to achieve the set target in project implementation could be attributed to amongst others: the change in Government in 1991 and the reformulation of the project in 1992 and 1995 with related delays; the civil strife within the region and the conflict with Eritrea and in Somalia. The project was however a much-needed intervention in these marginal areas and its achievements would have been much better had the political and civil environment been more conducive. The project won the support and confidence the local pastoralist and agro-pastoralist communities, and was viewed by the NGOs in the region as a reliable and rapid vehicle for channelling development resources into the rural communities within the project area.

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1. INTRODUCTION 1.1 Agriculture is the main stay of the Ethiopian economy, and in 1998/99 the sector employed 85% of the countries labour force, contributed 48% of GDP, 90% of export earnings and 70% of raw materials requirements of the agro-based industries. Crop production accounted for 60% of the sectors output, livestock accounted for 30%, while forestry contributed the remaining 10%. Peasant farm holds are the backbone of the sector, cultivating 96% of the cropped area and producing 90%-94% of all the cereals, pulses, and oilseed. The rangelands of Ethiopia cover an area of about 590,000 km2, which represents about 48% of the entire country. They are mostly located in the drier lowlands of the central, western and northern parts of the country and are generally unsuitable for cropping due to inadequate and highly variable and unpredictable rainfall pattern. Hence, nomadic pastoralism is its principal mode of economic activity. However, crop cultivation is increasingly gaining importance in areas with relatively better rainfall patterns and especially along seasonal rivers. There is therefore a tendency towards agro-pastoralism with settled farmers. Nonetheless, the rural economy in the rangelands is still heavily dependent livestock production and marketing. The livestock population in the project area was estimated to be approximately six million cattle, six million sheep, four and half million goats and one million camels. Despite the economic potential of the rangelands, they did not attract development efforts of the Governments of Ethiopia until the mid-sixties. 1.2 The first rangelands development programme was initiated in 1965, by the then Ministry of Agriculture (MoA) with financial support from USAID. The programme, which was formulated to develop an area of some 2,300 km2 of southern rangelands, included introduction of water development and range management practices. This was followed in 1973 by the second Livestock Development Project, which was financed by the World Bank. The aim of the second livestock project was to develop an integrated marketing and stock route system in the southern rangelands and to increase the livestock off-take as well as provide watering points for livestock and better marketing opportunities for the pastoralists. 1.3 The experiences and lessons learned from these two livestock projects were vital inputs into the formulation of the Rangelands Development Project, which was also known as the Third Livestock Development Project (TLDP). The TLDP was launched in 1975 with financial assistance from the African Development Fund (ADF) and the World Bank. It was designed to rehabilitate and develop the three rangelands of the Southern, North-eastern and Eastern lowlands of Ethiopia. Three subprojects were therefore formulated, namely, the North-eastern Rangelands Development Unit (NERDU), the Southern Rangelands Development Unit (SORDU) and the Jijiga Rangelands Development Unit (JIRDU). The ADF financed SORDU, while the World Bank funded NERDU and JIRDU. Of the three subprojects, JIRDU was located within the present South East Rangelands Project (SERP) area. 1.4 As at December 2001, the Bank Group had in all 25 operations in the agricultural sector in Ethiopia valued at UA 301 million equivalent to 30.4% of the total lending to Ethiopia of UA971.97 million including SERP. Other bank-funded projects in the agricultural sector have included coffee, tea, sugar, irrigation, livestock, and fertiliser. The first Bank financed project in Ethiopia was in 1975. 1.5 The South Eastern Rangelands Project (SERP) was identified in 1983 during the preparation of the follow-up proposals for the SORDU and JIRDU projects. It was prepared in 1984 by an external consultant contracted by the Animal and Fishery Resources

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Development Main Department of MOA. The final preparation report was produced in December 1985 and in 1986, the Government of Ethiopia requested the Bank to finance this project. The Bank fielded an appraisal mission in July 1987. Following the appraisal of the project, the Bank prepared and submitted its Appraisal Report to the Government for review and preparation for negotiation. The Government advised the Bank to modify certain aspects of the project so as to strengthen its long-term sustainability. These included revision of project area to take into account changes in the country’s administrative regions, introduction of dry land farming, inclusion of a feasibility study of small-scale irrigation, changes in the amount of technical assistance and revision of costs to take into account local and international inflation. As a result, the Bank mounted a re-appraisal mission in March 1989 to incorporate these revisions. The ADF Board of Directors approved the revised SERP project on 23 August 1989 and the loan was signed on 01 December 1989. The project however did not become effective until 20 October 1990. 1.6 The purpose of the Project Completion Report was to undertake a post-mortem assessment of project implementation in order to determine lessons learned and to make recommendations for the future. The PCR was based on data and information collected from various sources including the Appraisal Report, Bank Project Files, Borrower’s PCR, Borrower’s financial, audit and technical reports and available quarterly progress reports. Interviews with Project staff and Regional Officers as well as on-site inspections of project achievements during the PCR visit to the Project area provided useful information. At the time of the PCR mission however, the SERP PMU had been dissolved and the staff were in the process of being integrated into the Regional Agricultural Bureau. Availability of data and information was constrained by lack of personnel at the project site and the poor morale of those available. This limited the type of analysis that could be undertaken by the mission. 2. PROJECT OBJECTIVE AND FORMULATION 2.1 Project Objective: The long-term development objective of SERP was to raise the living standards of Pastoralists of the southeast rangelands of Ethiopia by improving the productivity of their livestock while ensuring the sustainability of their natural resource base. There were no changed in the original objective of the project. In April 1992 however with the ushering in of a new Government it was agreed that the project objective would lay greater emphasis on improving the food security position, while ensuring the sustainability of the natural resource base of the region. The project would also adopt a more democratic community-based approach to development than envisaged at appraisal so as to ensure acceptability of the interventions by the local communities. 2.2 Project Description At appraisal, the project activities were to be implemented under seven components namely: i) Cooperatives Development; ii) Animal Production and Health; iii) Infrastructure Development; iv) Land Use and Range Development; v) Livestock Marketing; vi) Management and Administration; and vii) Technical Assistance. Following the 1995 reformulation, the project was consolidated into five major components described below: i. Extension and Community Development: The original focus of this component was the development of Pastoralist Associations (Pas) to the extent of serving as supply and marketing cooperatives. However, the 1992 re-structuring, changed the focus to using extension personnel and local traditional “degaan” councils as the focal entry point for the project. The degaan councils were thus instituted, developed and empowered to serve the needs of both the

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pastoralists and the agro-pastoralists. Activities included field days and demonstrations, seedling production contracts and distribution, and establishment of women’s groups, women’s micro-projects, and extension systems. The goal of the component was to develop an effective mechanism for engaging both pastoralists and agro-pastoralists in the development of their communities. The component comprised of three units, namely, extension, community development planning and women extension development. ii. Animal Health, Production and Marketing: The overall objective of this component was to increase livestock production and productivity while ensuring environmental stability by investigating, monitoring and reporting any disease outbreaks, controlling livestock disease spread through vaccination campaigns and treatments, introducing modern animal husbandry techniques and appropriate technologies and improving the efficiency of livestock marketing as well as training of field staff. Modifications to this component after the 1992 restructuring included the construction of 7 additional animal health centres and the training and deployment of private community veterinary technicians (paravets). The main activities under livestock marketing included the development of a market information system and marketing infrastructure. iii. Land Use and Range Management: This component was essentially the core of the project with an objective to improve agricultural productivity while sustaining the natural resource base by introducing appropriate drought-tolerant crops and fodder species and developing technologies/techniques suitable for the rangelands in an extremely fragile environment. The component was responsible for planning, executing, and monitoring range development and management activities including collection of baseline data, preparation of resource inventories and relevant maps, and determination of production parameters. It was divided into four sub-components, namely, range monitoring and evaluation, range management, strengthening of Alemaya University, and water development. This component included most of the technical assistance, post-graduate training, agro-Pastoral studies and research, adaptive trials, provision and conservation of water and soil, forage trials and forestry development, species identification and aerial surveys. It was also charged with testing of drought-resistant crops and forage species, improvement in water resource management, establishing model ranches, co-ordinating all land use activities and conducting feasibility studies for a possible irrigation scheme at Mustahil in the project area. In addition, it was expected to assist Alemaya University in the development of a Range and Land use Department as well as linking with the then the International Livestock Centre for Africa (ILCA) on field research and training. iv. Infrastructure Development: This was the largest component of the project, comprising 36.7% of the original appraisal base cost. This component was designed to respond to the absence of infrastructure facilities such as roads, water points, grain stores, staff houses and offices within the project area. At appraisal, all civil works were confined to the Project Construction Brigade, which was to be equipped with required equipment, heavy machinery and vehicles needed to carry out their duties. It was assumed that sufficient experience for this type of construction works already existed within JIRDU, which could be absorbed by SERP. It was also assumed that the Brigade was going to work in close collaboration with the Rural Infrastructure Development Main Department of the MOA and the ETCA to ensure adherence to building and road construction norms. In terms of targets, the component was to build 8 and rehabilitate 7 development Centres, construct 119 grain stores, 91 staff houses of three different types, 1 guest house, 2 dormitories, 2 water tanks, 1 fuel tank, 2 sheds, 1 garage/workshop, 2 offices, 1 store, 1 main laboratory, and 1 satellite laboratory and to upgrade a veterinary

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laboratory in Jijiga. In addition, the project was to finance the construction of a total of 1,810 km road network including 545 km of RR30 roads and 1,265 km of RR10 roads, 2 boreholes, 50 ponds, 75 shallow wells, and 40 concrete cisterns known traditionally as birka.. The component was also responsible for road maintenance and construction of water diversification canals. v. Project Management and Administration: At appraisal, the project implementation was to be administered by an autonomous Project Management Unit (PMU) under the supervision of the General Manager of Rangelands Department, erstwhile TLDP, and the Office of the Vice Minister, AFRDMD of MOA. The responsibility for policy guidance and leadership directives was vested with the Project Steering Committee (PSC) under the chair of the Vice Minister of MOA. The PSC was also responsible for coordinating any other Government and donor activities in the project area, while the PMU was in charge of direct management and administration of the project. The PMU was to be headed by a Project Manager, based at the project Headquarters in Jijiga and assisted by two Field Directors at the two major project field sites, Jijiga and Gode, and six Section/Component Heads. In addition, the project was to maintain an office within MOA in Addis Ababa to deal with procurement and coordination matters as well as various maintenance facilities and office equipment. Training and information were added to this component during the restructuring. The establishment of the PSC was a condition of the loan. Project management was required to undertake a mid-term review. Project Management and Administration was designed to provide the necessary support services to the various technical sections of the project in order to ensure their efficient operation and effective execution of the project. 2.3 Project origin and Formulation: After the first three livestock projects, the Fourth Livestock Project was aimed at developing the livestock sub-sector in the highland regions of the country. In 1988 a small rangeland pilot project in the southern rangelands commenced as a subsidiary part of the Fourth Livestock Project. Results and experiences from this pilot project were used in designing SERP. The project identification of SERP came with the preparation of proposals for follow-up of the two sub-units of the Third Livestock Development Project, namely SORDU and JIRDU. A consultant prepared the detailed project study and proposal for the South Eastern Rangelands Development Project (SERP) in 1984/85 and the proposal was submitted to the African Development Bank for consideration of financing in 1986. The Bank Appraisal mission was fielded in July 1987, whose draft report was submitted to the Ethiopian Government for comments. The government reviewed this report and recommended a number of modifications necessary to enhance the sustainability and long-term development impact of the project. Accordingly, the Bank fielded a re-appraisal mission in March 1989. 3. PROJECT EXECUTION 3.1 Effectiveness and Start-up 3.1.1 The conditions for entry into force of the project set by the Bank required the

Borrower to have: i) Given an undertaking to make regularly adequate allocations in its annual budget to

finance its share of the cost of the project as set out in the financing plan; ii) Given an undertaking to assume responsibility to meet all cost overruns of the project; iii) Given an undertaking not to use the proceeds of the loan for the payment of the

various duties and taxes relating to goods and services required for the execution of the project;

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iv) Appointed a project manager, whose qualification and experience shall be acceptable to the fund;

v) Set up a project management unit consisting of the project manager, two fields managers and heads of sections, to coordinate the implementation of the project. and,

vi) Given an undertaking that adequate supply of material will be made available for carrying out the construction of the project infrastructure

3.1.2 The loan conditions set at appraisal were appropriate for the type of project and activities that were to be undertake. The project however experienced start-up delays due to difficulties in finding the right personnel to fill in the management positions spelt out in conditions (iv ) and (v) of the loan. Consequently, it took 14 months for the borrower to fulfil the loan conditions instead of the 3 months (180 days) stipulated by the Bank. The loan was approved on 23/08/1989 and declared affective on 20/10/1990, resulting in 11 months slippage. 3.2 Modifications 3.2.1 A few months after commencement of the project in 1990 there was a change in Government in Ethiopia, which introduced new policy orientations and the liberalisation of the economy. This was a drastic shift from the centralist system of the previous Government. As a result, in April 1992 a major workshop was held in Jijiga and attended by representatives of the Ethiopian Government, SERP, Third Livestock Development Project (TLDP), African Development Bank Group (ADB) and local pastoral community elders aimed to re-structure SERP to conform with the new dispensation. This workshop was preceded by a series of consultative workshops and meetings with elders and local administrators throughout the project area. With the insistence of the Bank, the participants at the workshop agreed not to drastically modify the objectives of the project but to lay greater emphasis on improving livestock productivity and increasing food security while ensuring the sustainability of the natural resource base of the region. The workshop participants agreed to maintain the seven components of SERP but to re-formulate the Cooperative Development component into the Extension and Institution Development component and the Livestock Marketing into Livestock Marketing and Economics. 3.2.2 The Government and the Bank approved the re-formulated SERP and the revised List of Goods and Services (LOGS) in March 1993 and in August 1994, respectively. In September 1995, the Government again decided to revise SERP. In this case, a detailed re-formulation document including new LOGS was prepared and submitted to the Bank by the Government. This included recommendation to extend the deadline for final disbursement for another one and a half years (till mid 1998) to enable the project to effectively and efficiently utilise its outstanding resources. Following the 1995 reorganisation of SERP, the following components and activities were retained: 3.2.3 Extension and Community Development: Cooperative Development became Extension and Community Development because of its new role of extension and institutional building in the rural communities. Also the role of junior development agents was assumed by the District Extension Officers with improved technical skills while the technical staff at the branch offices became the Subject Matter Specialists (SMSs) whose responsibilities involved serving the needs of regional offices and development centres. The extension experts and technical personnel at the regional office were made in charge of supervision and training. The large size of the project area (35 districts) and the poorly

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developed communications infrastructure underscored the need for the project organisation to have both a high degree of operational autonomy, and presence at the District level, in order to ensure effectiveness. This required additional staff and other resources and a better-defined organisational structure. The re-structuring also noted that the 15 development centres originally planned for the project area, i.e. at least one development centre per 16,333 km2, were grossly inadequate for the entire project area. The organisation of Peasant Associations and service cooperatives was dropped in favour of degaan councils. 3.2.4 Animal Production, Health and Livestock Marketing: The Animal Production and Health component was merged with the Livestock Marketing component to form the Animal Production, Health and Livestock Marketing component. The seven mobile control teams were cancelled in conformity with the community participatory strategy and the full integration of animal health services with the revised extension programme. A network of Pastoral Animal Health Assistants (PAHAs) replaced veterinary scouts in order to enable the development of a sustainable community-based animal health delivery system and encourage the privatisation of animal health delivery services. The three issues that necessitated changes in the activities of the former livestock marketing section were the adoption of free market policies, the termination of stocker-feeder programme and the overlap in functions between the marketing section in MOA and SERP. It was decided that the objective of increasing livestock off-take in the project area could best be achieved by directing project resources to improving livestock husbandry and animal health by strengthening the extension services. It was also agreed that the physical improvements to stock routes, holding grounds and markets be the responsibility of the Infrastructure Development Component. Hence, these activities were transferred to the latter. It was also felt that the project should neither intervene in livestock trading because of free trade nor provide credit to project beneficiaries because of the existence of commercial Banks in the country. 3.2.5 Infrastructure Development: The component was charged with implementing all civil works under force account using the Project Construction Brigade. However, a decision was later taken to contract out some parts of the civil works by National Competitive Bidding in order to release staff and equipment for other rural development activities. In addition, the infrastructure development section was to undertake the construction of rural roads and rural water supplies using force account. This was because the adoption of the community participatory approach, whereby individual communities would identify and prioritise their development needs and also participate in their execution, would reduce staff time and lessen the cost of road construction and water supplies development. The construction of type C houses was cancelled while the number of type D houses was raised from 53 to 62. Funds allocated for two boreholes in Jijiga and Gode were to be used for the development of two full water supply systems for SERP premises at both field sites. The construction of 119 grain stores was cancelled and replaced with the erection of grain/seed stores in each development centre. 3.2.6 Land use and Range Management: The re-designed project did not modify the objectives of this component. However, the study of the feasibility of developing an irrigation scheme at Mustahil, the establishment of model ranches, the liaison with the then ILCA for research and training, and the assistance to Alemaya University to establish a Range and Land use Department and strengthen its capacity to undertake range and land use work were dropped during project implementation period. The reasons were mainly lack of skilled manpower and willingness on the part of the University authority to push for this.

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3.2.7 Management and Administration: The restructuring created two branches and delegated more authority to the field managers and regional office co-ordinators. This was designed to improve the efficiency of service delivery in the project area, because of the poor communication infrastructure and vastness. The Project headquarters at Jijiga was re-organised to have (i) financial services, (ii) audit and inspection unit, (iii) legal services, (iv) personnel services, (v) staff development and training unit, (vi) information and public relations services, (vii) planning and programming unit, (viii) procurement and stores services, (ix) workshop services, and (x) transport services. The re-organisation was meant to provide for a more effective and efficient use of project resources and delivery of services to the project’s clientele. However, this resulted in more staff requirement than was envisaged at appraisal. 3.3 Implementation Schedule 3.3.1 According to the appraisal report, the project was to be implemented over a six-year period. The project was approved in August 1989, signed on 01 December 1989 and was declared effective on 11 October 1990, resulting in a slippage of 8 months. At appraisal in 1989, it was envisaged, that the first year of the project would be devoted to the recruitment of staff (both local and foreign), procurement of equipment and vehicles, construction of project infrastructure, and provision of training. Actual project activities only started in 1992. The mid-term review scheduled for December 1992, was never carried out and instead the supervision mission of 1998 was mandated to review the project and make recommendations for smoothening project implementation, especially as the project was having some financial problems at the time. The initial disbursement deadline for the project was December 1996. The project implementation however continued up to year 2000, a total of 11 years instead of the initial 6 years. 3.3.2 The sweeping policy and political changes introduced by the new government had considerable implications (economic, social, financial, institutional, relationships, etc.) on SERP and its implementation schedule, resulting in delays in its operational activities, including procurement of goods, works and services. Following the restructuring of SERP it took the Bank and the government from April 1992 to August 1994 for the reformulation to be approved. As a result, the project did not benefit much from the expertise of the Technical Assistance team, which was already in the field. The TA team and staff of the project were frequently subjected to the repeated restructuring of SERP, which continued until late October 1995. The influx of refugees and returnees into the project area also put a lot of demand on the limited resources of the project. Other factors that led to delays included the frequent conflicts in the neighbouring Somalia and the civil strife within the project area, which created insecurity for implementation of project activities. As a result of the border conflict with Eritrea several contractors were deported leaving behind unfinished works 3.3.3 Other factors which contributed to delay in implementation of the project activities include: the shortage in skilled manpower, poor financial management, delays in disbursement and project suspension, frequent changes in project management, political interference in project management, delays in procurement, etc. In addition, the project design itself required the civil works to be implemented by force account using staff of the infrastructure development component, which was not realistic, considering the complexity of some of these works and the skills mix in the region. Hence, the change during implementation into a combination of National Competitive bidding (NCB) and force account. Consequently, the procurement of the necessary materials, which were stipulated, to

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be acquired within the first year of the project were not effected until the third year. The construction of the buildings with other planned civil works commenced after more than three years delay. These delays inevitably affected the operational performance of the project in all aspects. The acquisition of necessary supplies such as veterinary drugs by SERP was also problematic. There was a conflict between the Government’s policy on free distribution of drugs and vaccines, and that the cost recovery mechanism put in place by the project. There were delays in the implementation of all project activities and most remained incomplete by the closure of the project in December 2000. 3.4 Reporting The PCR mission was informed that Audited accounts had been submitted to the Bank up to June 1999. An un-audited draft copy of the June 2000 accounts was given to the mission. Although progress reports were submitted to the Bank these were not timely. The borrower’s PCR was prepared with assistances from consultants hired through Bank funding. The PCR did not adhere to the format provided by the bank and lacked most of the essential information. With assistance from the TA, the project implemented 9 out of 26 planned studies and prepared 123 out of 132 planned proposals and reports. These studies and reports provided the project with the opportunities to look critically at issues like land tenure, rural development institutional arrangement, community development planning, community needs assessment and prioritisation and the socio-economics of the rural communities. These studies will form a good base for any follow-up projects in the region. 3.5 Procurement 3.5.1 According to the appraisal report, the procurement of plant equipment, vehicles and farm machinery, veterinary drugs, were to be procured through ICB. The recruitment of Technical Assistance and Short-term consultancies was to be done through limited competition among qualified consultants in accordance with Bank rules. Efforts were to be made to obtain such technical assistance through a consulting firm. The Government was also expected to establish twinning arrangements between SERP and appropriate Institutions or Universities abroad. Office equipment, furniture and miscellaneous items were to be procured locally as needed. The Project Construction Brigade was to have undertaken all project civil works including buildings, roads and water developments through force account using machinery and equipment to be procured under the project and experience gained from previous projects (e.g. JIRDU). Borrower’s preference was to apply on the selection of Institutions for training of project staff. 3.5.2 Plant equipment, vehicles and farm machinery and veterinary drugs were procured through International Competitive Bidding (ICB) as stipulated in the Appraisal report. The construction of civil works by the project’s Construction Brigade by force account was however changed partly to contracting out to local construction firms. Staff houses, offices, development centres and other project buildings were constructed by contractors, while the Project Construction Brigade executed all other civil works. This was compliant and in-line with Bank procedures. The first two years of project’s implementation incidentally coincided with the time when the country was experiencing political instability. Consequently, the procurement of machinery and equipment was delayed up to the third year of project implementation. All items procured under the project have been supplied and delivered to the respective project sites except for seven containers comprising generators and laboratory equipment that were still at the Addis Ababa office pending delivery to the Project

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Headquarters in Jijiga. The mission was informed at the time that the Regional Government was keeping the containers in Addis Ababa awaiting the finalisation of the transfer of the SERP staff to the Regional Bureaux. The government feared loss and pilferage, as most staff had not been paid for almost six months at the time of the PCR. As the civil works on most of the laboratories and community centres were completed, the mission urged the Regional government to ensure the equipment was transported to the various destinations for the intended purposes. 3.6 Financial Sources and Disbursement A total of UA 18.29 million (78%) of the total loan of UA 23.45 million was disbursed, while UA 5.17 million (22%) was cancelled. The Government contribution to the project amounted to Birr 69.61 million equivalent to UA6.60 million (PCR time exchange of 1 UA: Birr 10.5444). At appraisal, it was envisaged that the Government would contribute UA 5.99 million at the then rate of UA: Birr2.360. Effectively this means that the government contribution exceeded that envisaged at appraisal. The annual disbursements by the GOE and ADF are given in Annex 2 of the report. The Bank suspended disbursement to the project so several times due to the application of financial resources on non-eligible items. In an effort to deal with the problem, the Bank organised a visit to the Bank by senior staff of the project in an effort to familiarise them with the Bank documentation and procedures. Project financing by category of expenditure and planned and actual sources of financing is given in annex 3. 4. PROJECT PERFORMANCE 4.1 Overall Assessment: The implementation of the SERP project coincided with the most difficult period in the history of Ethiopia, in general and the Somali Region in particular. Shortly after the commencement of project, there was a change in government in May 1991. The new Government introduced sweeping policy and political changes such as regionalisation, democratisation and free market practices. Consequently, the project was reformulated twice in 1992 and in 1995 although the project concept was never modified. In 1992, the original proposal to set-up Pastoralist Associations (PAs) and Service Cooperatives (SCs) in the project area was cancelled, thereby giving the individual communities the freedom to join or form associations of their choice. The frequent conflicts in neighbouring Somalia and the civil strife within the project area also created insecurity problems, which made the supervision and monitoring of project activities impossible, especially in the Ogaden area. The influx of refugees and returnees into the project area, pressed a lot of demands on the limited resources of the project, especially project staff time and vehicles which were at times mobilised to deliver emergency relief supplies. The border conflict with Eritrea also resulted in the sudden deportation of people who had received contracts and payments to undertake civil works for the project, leading to incomplete works. Frequent changes in project management (8 in all) also did not augur well for the smooth implementation of the project. Overall, from the assessments carried out, the project only achieved about 50%-60% of the targeted activities. The project however earned the support and confidence of the local Pastoralists and agro-Pastoralists communities and was viewed by the NGOs in the region as a reliable and rapid vehicle for channelling development resources into the rural communities within the project area.

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4.2 Operational Performance: The performance of the project by components was as follows: Extension and Community Development: 4.2.1 The achievements of this component are summarized in Annex 5. The highlights of the component included the distribution of about 570,237 seedlings, 756 kg grain/fodder seeds and 250 farm tools out of planned 2,052,000, 756 and 300, respectively to the project beneficiaries. These inputs combined with the provision of irrigation facilities have had positive impact on the beneficiaries involved in cultivation of cereal, fruits and vegetables. These achievements have contributed to enhancing the income-earning power of the rural communities. The project also installed one out of two planned biogas plants at Elbahay and built energy-saving stoves for returnees and refugees in collaboration with UNHCR. Both developments are supposedly appropriate low-input technology substitutes for fuel-wood consumption. The biogas technology however turned out to be a failure because of (a) lack of a qualified engineer in the field, (b) high cost of setting and operating the gadgets, (c) lack of after-service back-up, (d) inadequate water in a drought-prone environment, and (e) availability of a cost-free alternative (dry cow dung). The project also introduced 272 micro-projects, comprising vegetable gardening, goat breeding, poultry rearing, bee-keeping and handicrafts-making, out of 769 planned to various segments of the community (degaan), including rural women and returnees. These micro-enterprises provided the communities with employment opportunities and broadened their sources of income. 4.2.2 The project succeeded in establishing five out of the 32 PAs planned and one out of two SCs before the activity was cancelled in the 1992 reformulation. Still, in order to adhere to the community-centred development approach, the project opted to use a traditionally existing approach of community elders, known as Degaan Councils. Hence, the formation of 37 out of 45 planned Degaan Councils in the project area. In due course, the project observed that channelling development through these councils was time consuming and not quite effective. Consequently, it was decided to experiment with the formation of contact farmers’ groups, of which 1,399 were set-up out of the 2014 planned. The project under its women extension development unit (WEDU) also formed about 789 out of 1,232 planned women’s development groups to specifically target the rural women, although women were also members of the Degaan Councils, PAs and Contact Farmers’ Groups. The project also built 25 Development Centres and rehabilitated 12 others for the Extension Unit. 4.2.3 The project implemented nine out of 26 planned studies and prepared 123 out of 132 planned proposals and reports. These studies and reports provided the project with the opportunities to look critically at issues like land tenure, rural development institutional arrangement, community development planning, community needs assessment and prioritisation and the socio-economics of the rural communities. The project also was successful in organizing home economics training for women (434 out of 819 planned), training workshop for extension staff (15 out of 30), community sensitisation workshops for the Degaan Councils, and local development groups (15 out of 28), local study tours for project staff (5 out of 8), community field days (486 out of 2653) and on-farm demonstrations in animal traction (one out of 8) and agronomic (farming) techniques (6722 out of 1395). Shortages of inputs (funds, agricultural inputs, skilled manpower, etc.) were partly responsible for the shortfalls. Other activities implemented under this component included the recruitment of 34 staff in the Extension Unit, rendered 22 out of 25 extension services and coordinated the preparation of 11 out of 16 community development plans, and carrying out

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of 20 out of 42 needs assessment studies of the Degaan Councils. The project bought 2 out of 8 camera/video equipment planned and 20 mobile radios. Animal Health, Production and Marketing: 4.2.4 The achievements under this component are summarized in Annex 6. Two mobile field teams were set-up and equipped with collection/preservation equipment, camping gear, vehicles and computer facilities. These teams were responsible for collecting blood and faecal specimens in the field for laboratory analysis in the rehabilitated Veterinary Laboratory in Jijiga. The project was able to investigate and bring under control PPR and camel respiratory disease outbreaks in the project area. Vaccination campaigns in the project area resulted in 6,037,490 out of 11,605,153 planned livestock vaccinations. About 5,804,990 out of 9,696,143 reported sick cases were treated during the project period. These achievements were attained through the training of about 190 out of 250 planned Community Animal Health Care Workers, PAHAs. The PAHAs were trained and equipped with veterinary kits and ETB1,500 worth of drugs each. Four mobile veterinary clinics have been established in the project area. The project also established a drug revolving fund for sustaining the availability of drugs and vaccines in the communities. This fund has not functioned efficiently since its creation because of poor financial management. Besides, the component has limited achievements because of shortages in funds, drugs and vaccines, transport, etc. Unfortunately the construction and equipping of Dire Dawa Veterinary Laboratory and Gode Satellite Laboratory were not complete by the time of the mission. . 4.2.5 Under the Animal Husbandry and Feed Improvement activities, about 21,401 such animals were castrated and goats, birds and bee-keeping facilities were distributed to various communities in collaboration with the Extension and Community Development Component. In all 8 laboratory technicians, 3 trainers and 190 PAHAs were trained in collaboration with Save the Children (UK). The training of PAHAs had the advantage of sustaining the delivery of animal health services (treatment and advice) most needed by the pastoralists and agropastoralists. Under this component, the project produced 30 reports out of the 33 planned on collection and dissemination of livestock market information and 28 reports out of 55 planned on livestock movement studies. It has rehabilitated 8 out of 17 planned livestock markets and established 10 out of 12 planned new livestock markets. Within the livestock markets, the project has constructed 5 out of 7 loading ramps and 5 out of 7 shelters (offices) for market technicians. About 8 workshops on improving hides and skins and 7 out of 8 workshops on livestock marketing were organised. Land Use and Range Management: 4.2.6 The achievements under this component are summarized in Annex 7. Under this component, the project was responsible for conducting field trials on water harvesting (irrigation) techniques, and drought-tolerant and improved grain crops and fodder varieties, seed distribution, forage conservation, development and utilization of fodder banks and testing, demonstration and utilization of proven range management practices. One reference herbarium has been built and equipped with various plant species collections in the SERP Head Office in Jijiga. To date, about 6500 plant species have been collected and identified. The project set-up 3 out of 19 meteorological stations for monitoring range weather conditions (temperature, rainfall, dew point, evaporation, etc.), which are essential for practical range management. For range regeneration, the project collected 2,600 out of 8,654 plant seeds and conducted 8 out of 42 range regeneration enclosures and 10 out of 18 range

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regeneration-training demonstrations. For sustainability of the range natural resources, the project conducted 34 out of 62 wind and water erosion control demonstrations, 4 out of 9 tree cutting studies, 1 out 2 weed control studies, 21 out of 111 range conditions and control vegetation stands studies, 4 range conditions mapping, 289 out of 370 plant use and ranking studies, 14 range management and soil conservation workshops and 17 out of 26 range management and soil conservation demonstrations. The project also administered 345 out of 437 palatability and plant use questionnaires and carried out 4 rangeland fodder studies, 3 out of 11 range trend monitoring site selections, 60 out of 98 livestock watering site surveys, 8 out of 24 livestock water development training demonstrations and 19 out of 44 gully erosion controls. It established 2 dry-land grazing reserves, 1 range monitoring system and 2 out of 11 thematic maps as well as selected 5 monitoring and enclosure study sites and 16 out 138 planned water development sites. The project also implemented jointly with WFP Food for Work Programme hill terracing and tree planting operations in the project area. 4.2.7 For the Agro-Pastoral and Water Harvesting techniques, the project conducted 74 training courses in small-scale irrigation, 11 water harvesting trials, 40 out of 44 grain /fodder crops adaptability trials, 9 out of 16 agro-Pastoral system studies, 2 out of 3 water harvesting and spreading demonstrations, 15 out of 24 extension training field days, 12 out of 25 water harvesting erosion control demonstrations and 2 out of 9 surveys and management of Yicib. The project has also established 10 out of 100 crop, fodder and water harvesting trails centres, 18 seed multiplication centres, and 1 out of 2 fodder banks. Under the agro-forestry developed activities, the project established 4 out of 6 multipurpose nurseries, 6 out of 7 tree nurseries, conducted 2 out of 3 multipurpose trees trials and provided technical assistance for the establishment of private nurseries. The project had distributed to project beneficiaries 2,043,136 out of 2,862,000 plant seedlings, 3,604 kg grain seeds, 1,800 gm of fruit seeds and 224,796 out of 210,686 vegetable seeds for the development of agro-forestry. Achievements under this component were limited by shortages in funds, skilled manpower, transport, etc. Infrastructure Development: 4.2.8 The infrastructure component was the largest in terms of investment. The achievements under this component are summarized in Annex 8. The implementation of this component started in early 1994/95 due to the late arrival of construction machineries for the project. The project established its own force account construction brigade to undertake the construction of access roads, stock routes, water ponds, shallow wells and various buildings for residential houses, offices, development centres, etc. The original assumption for force account was the existence of sufficient experience of the type within the previous project [JIRDU] and its predominance within the country as the government was socialist oriented at the time. However contracting out was later adopted as a strategy to reflect the change of socio-political environment of the time and in view of the magnitude of the workload on the brigade. Therefore, building works were contracted out while other civil works were executed by force account. 4.2.9 Roads: The project constructed 96km of RR30 type and 734km of RR10 type roads by force account representing 47% of the target, 1810km of both RR30 and RR10 type roads. In addition, the project maintained and cleared roads covering a total of 472km. These achievements exclude those constructed under the support of UNHCR through food for work program, which is about 1145km of RR10 type road. The roads constructed are generally village to market giving the community the opportunity to trade their products. Other services like health and veterinary were improved in the area where the roads were constructed. It

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encouraged also the opening up of more farmland in the area and served to access the communities for other development works. The roads construction focused on the remote areas of the region in the Ogaden part where access was a major problem. 4.2.10 The roads were in general in good shape and condition until end of year 2000. After year 2000 however, it was observed that the roads started wearing and degrading mainly due to surface runoff eroding the road and absence of routine maintenance. For the last one year the roads have not been maintained as the institutional set up, after phase out of SERP, has not been finalised. The earth moving machineries are in good shape and those broken needs only minor repairs. It is therefore important to sustain the investment by routinely maintaining the roads either with the formerly SERP construction brigade in collaboration with the communities, or with the Regional Rural Roads Authority where these roads have changed classification. For the long-term sustainability and upgrading of the roads, formal institutional and collaborative arrangements with the Regional Rural Roads Authority should be initiated. 4.2.11 Buildings: The project constructed or rehabilitated about 37 development centres around seven zones of the Somali Region. Five development centres are not yet operational although the buildings are erected. Final handover has not taken place as the contractors have outstanding payments with the project. The target set in the appraisal report was to construct or rehabilitate a total of 15 development centres. The level of achievement in this regard is 247%. The increase is attributed to the revision of the program and the need to have more centres to cover the vast project area with seven zones out of nine. The latter need was consistent with the policy of community-based development adopted by the project. 4.2.12 A total of 28 staff and guest houses, dormitories and tukuls were constructed against the target 94 at appraisal. Project staff members were given the staff residences built by the previous JIRDU project. Each development centre built under the project has staff residential quarters, thereby reducing the total number of houses required. The project built 2 offices at Jijiga and Gode branches, operational centres of SERP. However the office at Gode is incomplete. The laboratory at Jijiga was upgraded, 3 new veterinary clinics were built and made operational, the laboratory at Diredawa was expanded and one herbarium was built and made operational at Jijiga. A total of 21 livestock markets were established or rehabilitated, and 5 shelters for market technicians and 11 cattle crushes were built. Other structures built by the project include store, car shed, garage, fuel tank, cattle loading ramps, etc. 4.2.13 The overall construction of buildings for the various activities stands at about 54% against the appraisal target. This low level of achievement is attributed to the fact that the project abandoned the construction of 132 grain stores and less number of staff housing constructed.. It should be noted that a number of building structures are not in use either because they have not been handed over by the contractors or not completed. This will definitely reduce the achievement level.. 4.2.14 Water Development: With regard to water development the project delivered 21 birkas, 42 ponds, 62 shallow wells, 1 borehole, 2500m of water line and 16 km of diversion canals. A total of 43 rehabilitations of shallow wells and ponds were carried out. The level of achievement in the new development is about 75% of the appraisal, however the additional work in rehabilitating existing water points and spring development compensate for the shortfall. Considering the achievements not targeted in the appraisal, the overall water development achievement stands at more than 100% of the appraisal. However, the figures reach 92% of achievement with the revised targets. The mission noted that some of the outputs such as water ponds are not regularly maintained.

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4.3 Institutional Performance 4.3.1 In order to effectively implement the project given its low capacity, as a condition of the loan, the GOE was required to set up a Project Management Unit. The unit was to have a manager who would oversee the day-to-day management and direction of project assisted by two Field Directors and Heads of Sections. The institutional arrangements put in place by the GOE did not strictly adhere to that advocated by the Bank in that the overall execution responsibilities of the project were vested in the Ministry of Agriculture, under the General Manager of the Third Livestock Project. The day-to-day responsibility of the project was assigned to the Project Manager stationed at Jijiga, assisted by the administrative units and two field managers at Gode and Jijiga. The project also had an office in Addis Ababa to deal with procurement, clearance and delivery of goods, personnel movement and liaison in with government ministries and other organizations. With the decentralisation and the transfer of the project responsibilities to the Somali Regional Government, the project headquarter was moved to Jijiga. It was not clear to the PCR mission the point at which the position of Project Manager was converted to that of a General Manager. By the time of the dissolution of SERP, the project had a General Manager in Jijiga and two executive branch offices at Jijiga and Gode. In addition to these the project had established a total of 31 development centres under zonal offices in the region. The project also had a coordination office at Addis Ababa and a liaison office at Dire Dawa. 4.3.2 In view of the weak human capacity in the country at the time, the project also put in place a project technical assistance component to provide institutional and managerial support. Under the 166.3 man- month contract with the International Richard Woodroofe and Associates, the project management and implementation capacity was enhanced. The professionals supplied under the consultancy included: Range Management, System Analysis, Dry land Agronomy, Range Monitoring and Evaluation, Animal Health Epidemiology, and Socio Economic and Cooperative Development. Unfortunately, the consultancy services all came to an end by end of 1995 before project activities had fully taken off. The non-availability of qualified counterpart staff during these early stages of the project was a missed opportunity for the transfer of expertise. The project did not therefore benefit from the technical assistance to the extent envisaged. 4.3.3 Before their departure, the consultants had prepared several studies and produced various reports, technical reports, training leaflets, and guidelines with recommendations for effective implementation of the project. The Technical Consultants were also assigned the task of studying and restructuring the project in line with the new government's policy in 1992. The reformulation recommended a revision in the staffing structure of the project in order to provide the administrative and support services required by the project to implement the revised project. The consultants were also responsible for several project-funding proposals to support the project, which were successful in securing funding from the World Food Programme, UNCHR, OXFAM, and SCF (UK).

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4.4 Management and Organisational Effectiveness: 4.4.1 During the life of the project, there were frequent changes in the top management. The project had in all eight General Managers over the eleven years of implementation. Due to its importance to the Somali Region State the position of General Manager and other key management position were highly politicised. The Somali Region was extremely unstable throughout project implementation and there were frequent changes in Regional Presidents, which corresponded with changes in the person occupying the position of SERP General Manger. The situation only stabilised with the last General Manager who remained on the project for three years after the Bank imposed a condition requiring all changes in management to be cleared with the Bank. This however was towards the end of the project when the damage to the project had already been done. These frequent changes in top management resulted in uncertainty and instability for staff and disrupted project implementation. It is the mission’s view that this frequent change in top management impacted negatively towards the project, and the project would have achieved a lot more had there been stability and less interference from the politicians. 4.4.2 The 1992 reformulation of the project was also accompanied by a revision in the organisational and staffing structure to provide the administrative and support services required to implement the revised project design. The financial services unit was required to report directly to the project manager, the Audit and inspection service reported to the project administrator, the Administrative Service Unit was headed by the project administrator, the Planning and Programming Service was headed by the project economist and reported directly to the project manager, and the Training and Information Service was headed by the information officer reporting of the project administration. Several other re-organisations were undertaken after 1992. 4.5 Staff Recruitment, Training and Development At the point when SERP was dissolved it had a personnel strength of 792 employees, most of whom were employed on contract basis. In 1998 when the supervision mission visited the project, SERP had a staffing level of 566. While the project should have been rationalising on staffing, as it drew to a close, the project was instead expanding. One area where the project has made significant achievement has been in the training, upgrading and development of local professional and qualified staff to be able to fill the skill and knowledge gap in the project. In the last ten years of the project, a total of 464 personnel of the project received short and medium term trainings and advanced education abroad and locally. A total of 17 staff members received overseas training for MSc degree in various relevant fields. Inland training was given to 292 staff members while 5 member of SERP's top management visited Bank headquarters in Abidjan and 20 staff members benefited from overseas tours. A total of 26 educational workshops were conducted for staff training locally and 128 staff member made inland educational tours during the period. Unfortunately, a good number of those trained by the project have since left including 10 staff members trained abroad and 11 locally trained. Although this is a loss to the project, their loss will be no loss if they stay in the country and it will be a gain to the overall economy. The detailed breakdown of staff training under the project is given in table below. The table 4.1 shows that although the project made lots of gains in staff training, this still fell short of the total programmed training by the project as only 77.25% of the target was achieved.

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Table 4.1:Training and Manpower development Total Activities Unit Weight. Plan Perform.

Perf. % age

Weighted % age

Over seas training No. 20 37 17 45.95 9.19 Inland Training No. 15 290 292 100.69 15.10 Staff Workshop No. 5 24 26 108.33 5.24 Over seas training No 5 1 1 100.00 5.00 Local tour No 5 207 128 61.84 3.09 Over seas tour No. 15 20 20 100.00 15.00 Local tour (PAstorist) No. 15 120 95 97.17 11.88 Management trip to ADB No. 10 5 5 100.00 10.00 Local consultancy service received No. 10 2 2 100.00 10.00 Training Total Performance 100 84.68 Training contribution to the project performance

5 4.23

Over all performance 100 77.25 4.6 Performance of Contractors, Consultants and Suppliers 4.6.1 Contractors: The works contracted out included the construction of building facilities for various purposes. The overall performance of contractors was less than satisfactory. The major weakness observed with the contractors was the use of poor quality of materials and poor workmanship. On several occasions contractors were forced to replace items of substandard and poor workmanship. In some cases payments were withheld to force the contractors to deliver their work according to specification. The major problem contributing to poor performance of contractors was the inefficiency of the project office to undertake the supervision work properly given the fact that the area covered was vast. The other major problem contributing to poor performance of contractors was delayed payments to contractors, which in turn delayed project implementation. In terms of schedule all contracted out civil works showed significant slippage against original completion duration of 60 to 180 days. Some sub-projects contracted out in 1999 had not been completed due to disbursement problems. It was noted that two contractors with Eritrean background abandoned 4 projects and left the country during the war between Ethiopia and Eritrea. The estimated value of these contracts was about 2.4 million birr and the projects were about 70% complete. Three of the contracts were awarded in 1995 and one in 1999. These works had not been re- awarded to other contractors to complete them at the time of the PCR mission. 4.6.2 Civil Work Consultant: On advise of Bank supervision missions, a local consultant was recruited to supervise the contract administration of the remaining civil works. The consultant was employed in September 2000 to supervise a total of 27 sites. The performance of the consultant was rated satisfactory. The consultant in its 10 months of operation brought to near completion or completion the works under its contract. There was a marked improvement in terms of adherence to specification and standards. There were however problems with the documentation of contracts and supervision reports. 4.6.3 Performance of Suppliers: The performance of suppliers was satisfactory. All goods and other items procured were delivered timely and there were no marked problem with the quality of items supplied. 4.7 Management Consultants: A total of 166.3 person-months contact with the International Richard Woodroof and Associates a consultancy service was to assist in project management and in improving the project's implementation capacity and performance The

17

consultancy professionals fields supplied by the consultancy included: Range Management, System Analysis, Dry land Agronomy, Range Monitoring and Evaluation, Animal Health Epidemiology, and Socio Economic and Cooperative Development. The consultants prepared several studies and produced various reports, technical reports, training leaflets, and guidelines with recommendations for effective implementation of the project. The Technical Consultants were also assigned the task of studying and restructuring the project in line with the new government's policy in 1992. The consultants were also instrumental for soliciting additional funding and preparation of the proposals to support the project, which were successful in securing funding from the World Food Programme, UNCHR, OXFAM, and SCF (UK). Overall their performance was satisfactory. Unfortunately, the consultancy services all came to an end by end of 1995 before project activities had fully taken off. The project did not therefore fully benefit from the available technical assistance. The non-availability of qualified counterpart staff during these early stages of the project was a missed opportunity for the transfer of technology. 4.8 Conditions/ Covenants : The conditions set at appraisal were appropriate and were fulfilled with no difficult (see section 3.1.2). These served the Project adequately except for risks of war and civil strife, which could not be avoided. 5. FINANCIAL AND ECONOMIC PERFORMANCE The financial analysis of the project undertaken at appraisal was based on a model that assumed the establishment of Pastoralist Associations in accordance with the approach adopted by the government at the time. A total of 237 PAs were to be established over the project life. A representative PA was assumed to comprise of 100 families and to have in all 684 camels, 3384 cattle, 4464 sheep and 3414 goats. At full development with the project the model assumed that there would be an output of 175,141 Birr per PA or 1,750 Birr per family. This model was later abandoned in 1992 when the project was reformulated, and there was a drastic shift in favour of free market. As at the time of the PCR, the PA model used in financial analysis was no longer in place and no alternative models had been put in place at the time of reformulation. As indicated in the report, the project area and communities also suffered frequent displacement due to drought, frequent internal and external social conflict with neighbouring Somalia and Eritrea. The project did not establish a monitoring and evaluation mechanism by which the impact of the project on the incomes and livelihood of the pastoral families could be measured. With its limited achievements however, the project had some positive developmental impact on the communities through its various intervention described in section 4.2 of the report on the operational performance. 6. SOCIAL AND ENVIRONMENTAL IMPACTS 6.1 Social Impact: The project adopted a community-based approach to development which involved the individual communities in decisions about their future, encouraged local participation in development by involving them in assessing their needs and proposing solutions to addressing them. This fostered a sense of responsibility and belonging within the communities in order to ensure sustainability of development within project area during the post-project period. The individual communities not only participated in their needs assessment but also contributed to the development of various community initiatives through provision of labour, land, food, etc as well as participating in their maintenance depending on the arrangements with the project. For example, the formation of Degaan Councils, Pastoralist Associations, Women’s Development Groups and Contact Farmers’ Groups were considered as

18

avenues for identifying community needs and conduits for channelling development initiatives into the communities. The project also established a Women’s Extension Development Unit (WEDU), which was responsible for addressing development concerns affecting especially women in the different communities within the project area. Also established were Women Development Groups who benefited from the introduction of various income-generating enterprises like the goat breeding, bee keeping, vegetable gardening, poultry rearing and handicraft making. Women participated in various training activities including training in home economics. Women Development Agents were trained and deployed in the Development Centres in the regions. The movement of goods and animals was enhanced through interventions under the infrastructure component. 6.2 Environmental Impact: As part of the Land use and Range Management component and following the reformulation in 1995, the project was to improve agricultural productivity while sustaining the natural resource base. In that regard, the project mobilised the community to participate in hill terracing and tree planting with the support of the WFP Food for Work Programme, in order to control soil erosion and conserve water. The project also implemented many measures to control gully erosion (e.g. check dams) and reduce loss of trees through harvesting for fuelwood and construction (biogas production and cement-built energy-saving stoves). The project conducted awareness campaigns against the felling of trees in the project area. The communities were mobilised to development catchment protection like tree planting around the water points (ponds, shallow wells known as “birkas” etc) to control soil erosion and water evaporation. The activities where very successfully implemented. 7. PROJECT SUSTAINABILITY During the last Supervision mission of the project in March 2000, the mission was advised that the Regional Government had agreed to sustain SERP as a development institution by converting its 792 contract staff into regular civil servants and to seek funding for it from the donor community. The PCR mission however noted that this idea had been abandoned and that the Regional Government, after examining a number of scenarios, decided to transfer the staff and activities of SERP over to the restructured Regional LECDB Bureau. The PCR mission observed that the amalgamation exercise was underway although the bulk of the SERP staff of 792 was still awaiting new postings. This will ensure employment for the staff of the project and continuity in overseeing the achievements under SERP. Unfortunately, the Revolving fund account that was to ensure the availability of drugs, vaccines in the communities collapsed due to mismanagement and lack of consistency in policy by the GOE. The sustainability of activities under the animal health, production and marketing activities will face difficulties unless the GOE initiates new measures. The GOE will also have to ensure sufficient budgetary allocation to the Agricultural Bureaux to ensure that the infrastructure development including: access roads, stock routes, water ponds, wells, residential housing, offices, development centres etc are maintained and serviced. 8. PERFORMANCE OF THE BANK AND THE BORROWER 8.1 Performance of the Bank 8.1.1 Project Appraisal and Reformulation: The project design adopted by the Bank AT APPRAISAL was found to faulty by the GOE as it did fully address the pertinent issues of project sustainability. The project did not take into consideration the administrative changes

19

in the country. The GOE had to request for revision of the project to include changes in the administration regions, dry land farming, feasibility study of small-scale irrigation, technical assistance and also to adjust the cost in line with local and international inflation. The inclusion of the Biogas technology was also inappropriate for an arid environment where water is scarce. Even though the Bank participated in the 1992 revision of the project, it took the Bank close to two years to finally approve the new strategy and restructured components. In the meantime all project activities stalled delaying further project implementation. 8.1.2 Project Supervision: According to available information, the project was supervised in 1992, 1995 and then 1998, 1999 and 2000. There is no evidence that the project was supervised in between October 1990 and 1992, and 1992 to 1995. The project should have been supervised more often at the critical time when implementation activities were being initiated particularly after the project reformulation. This would have enabled the bank to take appropriate remedial action to streamline management weaknesses and accounting procedures. Because of the prevailing insecurity in the project area, the supervision missions were limited to the Jijiga area. The change in Government in 1991 it was also not possible for Bank missions to visit the country at the time. In addition Bank Group internal policies did not put much emphasis on supervision. However, the situation improved following the restructuring in 1995 and supervision mission became more regular. Although the 1995 supervision mission raised the issue of frequent changes in project management, the Bank did act on this until 1997, when they issued a directive requiring future changes to be cleared with the Bank. 8.1.3 Financial Performance: One of the factors that impacted negatively on the project was the frequent suspension of disbursement by the Bank due to financial irregularities and the application of resources on non-eligible expenses. Lack of proper record keeping and documentation of project activities is also an issue, which was mentioned by all Bank supervision missions and even by the external auditors. This compromised the credibility and accountability of the project management in the use of resources. The mission is of the opinion that a strict financial management manual with clearly stipulated financial guidelines would have enhanced accountability and speeded up project implementation. 8.2 Performance of the Borrower: 8.2.1 The project life was marked by various forms of political instability and uncertainty, which affected its performance. Civil strife and unrest throughout the region prevented smooth operation of the project. The change in government brought about a major shift of strategy and economic policy, i.e., mainly from a socialistic and highly centralized to a liberal and more market oriented. The government's administrative structure similarly drastically shifted its emphasis from highly centralized to decentralization giving more and greater power and responsibility to local and regional governments. A total of 14 regional administrative regions with a high measure of autonomy from the central government have been formed. Of these SERP fell within the Somali Regional State. 8.2.2 The SERP area was the scene of war with neighbouring Somalia in 1977/78. The economy of the area is highly linked with that of Somalia. The customary migration routes of Pastoral nomads traverse the international boundaries between the two countries i.e., Ethiopia and Somalia. Most of the trade of seasonal off take from livestock and livestock products has been traditionally conducted in and/or through Somalia partly being exported through her ports of Berbera and Mogadishu. War, disputes and conflicts on both sides of the

20

border affected the economy of the region in various ways though its extent is not well assessed. The effect includes: interruption of patterns of seasonal movement of the nomads and disruption of trade. The other one major phenomenon as a result of the political strife prevailing in the region within and across border to Somalia is the influx of refugees from Somalia and Ethiopian returnees from it. The resultant consequence is a significant increase of pressure on existing natural and economic resources of the region. 9. OVERALL PERFORMANCE AND RATING The overall rating of the project was unsatisfactory as given in the attached Annex 10 of the report. The implementation performance of the project was unsatisfactory with most of the activities achieving between 50% and 60% of the target against a disbursement rated of 78%. The performance of the Bank in appraising the project and identifying the needs of the communities was satisfactory. The Bank however failed in ensuring adequate supervision of the project and taking appropriate remedial measures whenever problems were identified. Had it not been to the difficult environment within which the project was implemented, this project had the potential to perform well, and would have had the desired impact on the people of the Somali Region. 10. CONCLUSIONS, RECOMMENDATIONS, AND LESSONS LEARNT 10.1 Conclusions: Overall, from the assessments carried out by the PCR mission, the project only achieved about 50%-60% of the targeted activities against a disbursement rate of 78%. Failure to achieve the set target in project implementation could be attributed to amongst others: the change in Government in 1991 and the reformulation of the project in 1992 and 1995 with related delays; the civil strife within the region and the conflict with Eritrea and in Somalia. The project was however a much-needed intervention in these marginal areas and its achievements would have been much better had the political and civil environment been more conducive. The project won the support and confidence the local pastoralist and agro-pastoralist communities, and was viewed by the NGOs in the region as a reliable and rapid vehicle for channelling development resources into the rural communities within the project area. 10.2 Lessons Learnt: 10.2.1 Despite the autonomy enjoyed by the PMU it was still ineffective in implementing the project because of inability to take appropriate decisions, slowness to act on decisions, lack of innovativeness and pro-activeness. This was largely due to the fact that the project was located in an area characterised by poor communication infrastructure and weak human capital. Project staff trained by the project were absent from the project for long durations with their positions unattended to. In designing future projects, the Bank should ensure that a detailed institutional and capacity analysis of the project area are carried out and proper measures incorporated in the project design. 10.2.2 The project was designed to cover a vast area with seven components and no defined targets. In addition, the project did not have a logframme matrix, which was to guide its implementation. The project also failed to undertake an in-depth and comprehensive analysis of the institutions both at the Federal and Regional levels in order to ascertain their capacity to

21

deliver the expected results. The impact of the poor communication infrastructure on the project was also not well analysed. The financial model used was based on pastoral associations that are unstable institutions. In future the scope of projects should take into consideration these limiting factors, which are critical ingredients to the successful implementation of the projects. Financial models should be based on farm households 10.2.3 The political instability in the country resulted in two reformulations in the project. The insecurity in the project area made it difficult to closely supervise project activities in the field and posed high risk to project staff and assets. The insecurity in neighbouring Somalia affected marketing of livestock and resulted in an influx of refugees and returnees into the project area, putting additional pressure on the project. The conflict with Eritrea resulted in sudden departure of contractors and abandonment of some civil works. The political interference in the project management in the region resulted in 8 managers over the 11 years of the project. Irregular and insufficient flow of counterpart funds further compounded the inefficiencies in the project. In future governance issues should be critically analysed and taken into consideration in the design of Bank funded project. In countries where there is a high risk of political interference in the management of Bank funded projects, a loan condition should be put in place requiring the borrower to clear all changes in senior project management staff with the Bank. This would act as a deterrent to frequent changes in management. Appropriate sanction measures should taken. 10.2.4 The lack of adherence to the sound financial and accounting principles was a cause of frequent suspension of the project. Although the key staff of the project were in place, their capacity to follow and adhere to Bank Rules and Procedures was limited. The Bank missions did not propose any training for project staff to resolve the accounting problem. To assist project staff in adhering to proper accounting and financial management systems, the Bank should consider introducing simple accounting and financial manuals for use by project management. Appropriate training should also be provided. 10.2.5 In case of projects with long duration, or where there are implementation delays, as was the case with SERP, there is a tendency for high staff turnover. There is also likelihood that the staff at the project in its final stages are not the same as those who started off the project. In such cases, the Bank should carry out a retraining of project staff to instill or update skills as well as familiarize project staff with any changes in Bank Group rules and procedures. 10.2.6 The SERP was supervised twice in the first six years of its implementation. Effective and regular supervision in ensuring loan conditions and guidelines are adhered to, and for the successful implementation of all Bank funded projects. Supervision missions should be more frequent in the early stages of the project implementation to ensure that proper procedures are followed, and where necessary for appropriate remedial action to be taken early enough. 10.3 Recommendations: For GOE: 10.3.1 The government should ensure that the Livestock, Environment, and Crop Development Bureau receives sufficient budgetary allocation, to be able to carry out adequate follow-up, maintenance and completion of all outstanding activities funded under the project including access roads, stock routes, water ponds, wells, residential houses, offices, development centres, etc. The Bureau should also continue to sensitize the communities on the importance of maintaining the infrastructures at their disposal (section 7)

22

10.3.2 The regional government should ensure that the seven containers comprising generators and laboratory equipment that were still at the Addis Ababa office are delivered to the laboratories and community centers that they were intended for. (3.5.2) 10.3.3 The Regional Government should expedite the amalgamation of the SERP staff of 792 into Livestock, Environment and Crop Development Bureau. The Bureau should utilize the technical skills and expertise from SERP to ensure sustainability of the developments achieved under the project. (Sect. 7) 10.3.4 At the time of the PCR mission, the roads had not been maintained as the institutional set up, after phasing out of SERP, had not been finalised. The earth moving machineries were in good shape and those broken down needed only minor repairs. The Regional Government should ensure the routine maintenance of these roads either with the formerly SERP Construction Brigade in collaboration with the communities, or with the Regional Rural Roads Authority where these roads have changed classification. For the long-term sustainability and upgrading of the roads, formal institutional and collaborative arrangements with the Regional Rural Roads Authority should be initiated. (4.2.5)

For the Bank: 10.3.5 In future the Bank should avoid funding programmes and projects in conflict prone areas because of the inherent risk to the investments and to those charged with the implementation responsibility. The supervision and close follow-up of projects in such areas by Bank staff is very difficult due to the associated high risks. Where conflict erupts after the project is underway, the Bank should revisit the situation and where the risk of the project achieving the intended objectives is high, appropriate measures to discontinue the project should be taken. 10.3.6 Adherence to sound financial and accounting principles is critical to the success of Bank funded projects. The Bank should develop an accounting and financial manual, which should be launched during launching missions. The manual would be useful in guiding project staff in accounting and financial management of project. 10.3.7 In case of projects with long duration, or where there are implementation delays, as was the case with SERP, the Bank should carry out a retraining of project staff to instill or update skills as well as familiarize project staff with any changes in Bank Group rules and procedures. 10.3.8 Effective and regular supervision is essential in ensuring successful implementation of all Bank funded projects. The Bank should ensure there are regular supervision missions of projects especially in the early stages of the project implementation.

ANNEX 1 ETHIOPIA

SOUTHEAST RANGELAND DEVELOPMENT PROJECT

ADMINISTRATIVE MAP BY REGIONS SHOWING THE PROJECT AREA

ERITREA

SUDAN

KENYA

SOMALIA

TIGRAY

AFAR

AMHARA

BENISHANGUL

GAMBELLA

SOUTHERNOROMIA

SOMALI

HARARI

DIRE DAWA

ADDIS ABABA

Project Area

This map was provided by the African Development Bank exclusively for the use of the readers of the report to which it is attached. The names used and the borders shown do not imply on the part of the Bank and its members any judgement concerning the legal status of a territory nor any approval or acceptance of these borders.

ANNEX 2

Page 1 of 2 SOUTHEAST RANGELANDS PROJECT

LIST OF CONTRACTS

Contract n° Contract Title Currency Amount % Amount in

UAC 5000003229 2 UNITS OF WHEEL LOADERS USD 210.171,56 100,00 156.068,765000003230 1 UNIT WHEELED EXCAVATOR FRF 591.316,99 100,01 72.940,055000003231 TRUCKS JPY 31.298.600 100,02 211.611,435000003232 TRUCKS SEK 5.681.900,00 100,03 522.022,345000003233 1 UNIT ROLLER SEK 478.600,00 100,04 45.961,785000003234 MOTOR VEHICLES JPY 85.098.199 100,05 575.353,265000003235 COMMUNICATION EQUIPMENT USD 13.349,00 100,06 9.332,165000003236 44 YAMAHA MOTOR CYCLE JPY 9.884.105 100,07 55.477,885000003237 TRUCK FRF 531.416,55 100,08 69.802,095000003238 TRAINING GBP 164.790,00 100,09 218.542,48 USD 89.500,00 100,10 62.536,255000003239 TUTION FEE & LIVING ALL. USD 78.000,00 100,11 52.484,615000003240 TRAINING GBP 14.760,00 100,12 19.574,535000003241 TRAINING FOR 10 CANDIDATES GBP 138.610,00 100,13 145.389,975000003242 AGRI-VISUAL EQUIPMENT GBP 16.756,00 100,14 18.023,975000003243 TECHNICAL ASSISTANCE USD 1.622.769,00 100,15 1.205.336,775000003244 AUDIO VISUAL EQUIPMEMT USD 89.438,00 100,16 66.414,695000003245 MOTOR VEHICLES DKK 969.864,00 100,17 114.371,705000003246 TOYOTA LAND CRUISER DKK 1.188.544,00 100,18 144.639,63 GBP 6.130,65 100,19 8.308,305000003247 AUDIO VISUAL EQUIPMENT GBP 50.445,00 100,20 52.473,305000003248 TRAINING NLG 19.680,49 100,21 7.990,78 USD 50.900,00 100,22 35.565,365000003249 TRAINING NLG 96.710,00 100,23 39.266,705000003250 21 SET OF COMMUNICATION RADIO ITL 237.190.000 100,24 99.350,345000003251 WANG COMPUTERS USD 35.840,00 100,25 25.267,915000003252 44 UNITS WIND SHIELDS ITL 2.112.000 100,26 884,64

5000003253 4 UNITS GRINDING MILL WITH SPARE ENGINE NLG 96.376,66 100,27 35.327,39

5000003254 SPARE PARTS FOR CONST.EQUIP. USD 47.536,00 100,28 31.806,235000003255 1 UNIT MOTOR GRADER FIAT-HITACHI USD 142.435,47 100,29 105.769,445000003256 1 UNIT BULLDOZER FIAT-HITACHI USD 209.872,26 100,30 155.846,515000003257 ONE UNIT OF BULLDOZER TRACTOR USD 221.374,48 100,31 141.114,315000003258 ARTICULATED MOTORGRADER USD 142.745,61 100,32 90.992,645000003259 LABORATORY EQUIPMENT FRF 1.101.553,00 100,33 144.690,075000003260 20 UNITS OF DIESEL GENERATORS ITL 375.800.000 100,34 157.409,085000003261 MOBILE EQUIPMENT GBP 85.487,28 100,35 86.862,665000003262 COMPUTING & COMPUTING EQUIPMENTS NLG 77.684,0 100,36 28.475,50

ANNEX 2

Page 2 of 2

Contract n° Contract Title Currency Amount % Amount in

UAC 5000003263 AIR CONDITIONER USD 26.500,00 100,37 16.892,32

5000003264 CONSTRUCTION OF NEW VETRINARY CLINIC AT ETB 311.904,69 100,38 31.986,19

5000003265 CONSTRUCTION OF THREE PACKAGED LIVESTOCK ETB 347.701,68 100,39 35.657,21

5000003266 CONSTRUCTION OF SIX PACKAGED CATTLE CRUS ETB 144.223,80 100,40 14.790,32

5000003267 CONSTRUCTION OF NEW DEVELOPMENT CENTRE A ETB 468.835,87 100,41 48.079,66

5000003268 CONSTRUCTION OF VETRINERY CLINIC AT DARO ETB 306.923,69 100,42 31.475,38

5000003269 CONSTRUCTION OF HERBARIUM HALL AT JIJIGA ETB 199.706,34 100,43

20.480,

12

5000003270 CONSTRUCTION OF VETRINARY CLINIC AT ARAB ETB 267.951,67 100,44 27.478,76

5000003271 CONSTRUCTION OF DEVELOPMENT CENTRE AT BO ETB 486.938,03 100,45 49.936,06

5000003272 CONSTRUCTION OF DEVELOPMENT CENTRE AT DA ETB 450.924,05 100,46 46.242,79

5000003273 CONSTRUCTION OFDEVELOPMENT CENTRE AT DIH ETB 458.639,12 100,47 47.033,98

5000003274 CONSTRUCTION OF DEVELOPMENT CENTER AT FE ETB 522.307,75 100,48 53.563,27

5000003275 CONSTRUCTION OF FOUR PACKAGED LIVESTOCK ETB 568.829,76 100,49 58.334,15

5000003276 CONSTRUCTION OF FIVE PACKAGED CATTLE CRU ETB 96.459,00 100,50 9892,03

ANNEX 3

ETHIOPIA

SOUTHEAST RANGELANDS PROJECT (In million UA)

ACTUAL COSTS AND FINANCING OF PROJECT BY CATEGORY OF EXPENDITURE

Expenditure by Category Loan Allocations Actual Utilization Un-disbursed/Cancelled

1. Civil Works 6,560,056.00 5,576,050.47 984,005.532. Vehicles/Machinery 3,858,902.05 3,725,228.90 133,673.153. Equipment/Supplies 4,605,384.61 4,045,250.82 560,133.794. Tech Assistance 1,851,769.17 1,541,362.83 310,406.345. Fellowship/Training 956,743.04 825,509.74 131,233.306. Operating Costs 4,277,129.13 2,570,218.86 1,706,910.277. Horses & Carts 1,340,000.00 0.00 1,340,000.008. Others 0.00 0.00 0.00Total 23,449,984.00 18,283,621.62 5,166,362.38

ANNEX 4

ETHIOPIA

SOUTHEAST RANGELANDS PROJECT ANNUAL DISBURSEMENT IN BIRR

IN MILLION BIRR Project Year GOE Contribution ADF Contribution Total Investment Cost

1990/91 7,922 3,222 11,144 1991/92 1,475 3,564 5,039 1992/93 10,000 1993/94 4,752 27,386 32,138 1994/95 8,336 6,111 14,447 1995/96 11,911 13,288 25,199 1996/97 11,610 29,204 40,814 1997/98 5,972 10,000 15,972 1998/99 9,230 17,128 26,358 1999/2000 8,410 17,909 26,319 Total 69,618 137,812 207,430 % of Total 35.20% 64.80% 100

ANNUAL DISBURSEMENT ADF LOAN IN million UA Year Opening Total Amount Cancellation Balance Disbursed Amount 1/12/1989 23,449,984.00 1,117,896.92 1990 22,332,087.08 218,708.60 1991 22,113,378.48 862,801.61 1992 21,250,576.87 2,083,793.36 1993 19,166,783.51 1,880,765.54 1994 17,286,017.97 1,406,138.61 1995 15,879,879.36 1,149,059.77 1996 14,730,819.59 3,906,773.14 1997 10,824,046.45 1,974,752.30 1998 8,849,294.15 3,025,783.56 1999 5,823,510.59 657, 148.21 2000 5,215,571.55 5,166,362.38 18,283.621.62

ANNEX 5

Implementation Status of the Extension and Community Development Component:

Outputs Appraisal targets

Revised targets Achievements Performance (%)

Agricultural inputs distributed: Seedlings (no) Seeds (kg) Farm tools (no)

NS NS NS

2,052,000 300 756

570,237 250 765

Agricultural technologies introduced: Biogas production Micro-projects

NS NS

1 769

1 272

Community-based institutions organized: Degaan Councils Women Development Groups Contact Farmers’ Groups Community Development Centres Service Cooperatives Pastoralist Associations (PAs)

NS NS NS NS NS 45

45 1232 2014 ?? 2 32

37 789 1399 25 1 5

Studies, Proposals and Reports Prepared: Proposals for organizing development institutions (written & implemented) Proposals for community development planning system Proposal for establishing district extension systems Reports on patterns & impact of returnees Reports on women needs assessment Review of JIRDU PAs Studies on land tenure Conduct of socio-economic studies Assessment of cooperative establishments

NS NS NS NS NS NS NS NS NS

62 36 2 22 10 1 5 4 16

67 33 2 14 7 1 1 4 3

Training and workshops conducted: Training of women in home economics Workshops for extension staff Local study tours Community sensitisation workshops On-farm demonstration of farming techniques On-farm demonstration of animal traction Community field days

NS NS NS NS NS NS NS

819 30 8 28 1,395 8 2,653

434 15 5 15 6,722 1 486

Other activities implemented: Recruitment of staff Render of extension services Coordination of preparation of community development planning Coordination of degaan needs assessment Mobile radios Camera/video

NS NS NS NS 7 20

34 25 16 42 8 20

34 22 11 20 2 20

*NA = Activities were either discontinued or figures were not available *NS= Not Specified

ANNEX 6

Implementation Status of the Animal Health, Production and Marketing Component:

Outputs Appraisal targets

Revised targets

Achievements Performance (%)

Disease investigation & monitoring implemented: 1.1 Mobile field teams set -up

2

2

2

Diseases controlled: Animals vaccinated Animals treated Drug revolving fund established Jijiga vet. Lab rehabilitated Dire Dawa vet. Lab constructed Gode Satellite lab constructed Mobile vet clinic set-up

NS NS 1 1 1 1 2

11,605,153 9,696,143 1 1 1 1 2

6,037,490 5,804,990 1 1 1 1 2

Animal husbandry an d feeding improved: Castration Goat breeding introduced for women (No. beneficiaries) Bee-keeping organized Poultry farming introduced

NS NS NS NS

21,401 NA NA NA

21,401 836 830 birds

Middle-level cadre trained: Laboratory technicians Trainers Pastoral Animal Health Assistants (PAHAs)

NS NS NS

NA NA 350

8 3 250

Livestock marketing efficiency improved & transparent: Livestock markets rehabilitated Livestock markets built Loading amps built Staff offices constructed Livestock marketing information collected and disseminated Livestock movement studies conducted Workshop on improving hides & skins conducted Workshop on livestock marketing conducted Cattle scales procured Stocker-feeder program implemented Steers purchased Steers sold

NS NS NS NS NS NS NS NS 13 2,000 1,584

17 12 7 7 33 reports 55 reports 8 8 NA* NA NA

8 10 5 5 30 28 8 7

*NA = Activities were either discontinued or figures were not available *NS= Not Specified

ANNEX 7 Page 1 of 2

Implementation Status of the Land Use and Range Management Component:

Outputs Appraisal targets Revised targets Achievements Performance (%)

Reference herbarium established Herbarium built Plant species collected & identified (no)

1 NS

1 6,000

1 6,500

Range management technologies developed and tested: Meteorological stations established Plant seeds for range regeneration collected Range regeneration enclosure demonstrated Range regeneration training demonstrated Wind & water erosion control demonstrated Over-cutting of trees studies conducted Rangelands weed control studies conducted Palatability & plant use questionnaires administered Range conditions & control vegetation stands studies conducted Plant use and ranking implemented Range conditions mapping conducted Range management & soil conservation demonstrated Range management & soil conservation workshop organized Dry-land grazing reserves established Rangelands fodder farm studies conducted Range trend monitoring sites selected Livestock watering site surveys conducted Range monitoring system set-up Monitoring & enclosure study sites select4ed Gully erosion control implemented Water development sites selected Livestock water development training demonstrated Thematic maps printed

NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS NS

19 8,654 42 18 62 9 2 437 111 370 4 26 14 2 2 11 98 1 3 44 138 24 11

3 2,600 8 10 34 4 1 345 21 289 4 17 14 2 4 3 60 1 5 19 16 8 2

ANNEX 7 Page 2 of 2

4

Agro-Pastoral and water harvesting techniques developed: Training courses in small-scale irrigation organized Crop, fodder and water harvesting trial centres established Water harvesting and spreading measures demonstrated Water harvesting trials conducted Agro-Pastoral system study conducted Grain and fodder adaptability trials conducted Seed multiplication centres established Fodder banks established Extension training field days organised Yicib survey and management implemented Water harvesting erosion control measures demonstrated

NS NS NS NS NS NS NS NS NS NS NS

26 100 3

16 44 16 2 24 9 25

74 10 2 11 9 40 18 1 15 2 12

Agro-forestry promoted: Multipurpose nurseries established Multipurpose tree trials conducted Technical assistance to private nurseries provided Tree nurseries developed Seedlings distributed (no) Seeds distributed (kg) Fruit seeds distributed (gm) Vegetable seeds distributed (gm)

NS NS NS NS NS NS NS NS

6 3 32 7 2,862,000 3,604 1,800 210,686

4 2 53 6 2,043,136 3,604 1,800 224,796

*NA = Activities were either discontinued or figures were not available *NS= Not Specified

ANNEX 8

Page 1 of 2 Implementation Status of the Infrastructure Development Component:

Infrastructure Facility Appraisal Target Revised Target

SERP-achieved

Performance against appraisal

Performance against revised program

Road Construction Road RR-30 545 545 96 18% 18% Road RR-10 1265 1265 734 58% 58% 1810 1810 830 46% 46% Maintenance Road Clearing 168 168 100% Road Maintenance recurrent/routine 240 278 116% 408 446 109% Building Construction Development center construction 8 19 25 313% 132% Development center rehabilitation 7 10 11 157% 110%

Grain store construction 132 0 0 0% 0% Satellite laboratory construction - Gode 1 0 0%

upgrading laboratory-Jijiga 1 1 100% Laboratory-Diredawa 1 1 100% Veterinary clinics 3 3 100% Herbarium hall 1 1 100% office construction 2 2 1 50% 50% store construction 2 1 50% car shed construction 2 2 2 100% 100% Guarage construction 1 1 1 100% 100% Fuel tank construction 2 1 50% Fencing work 14 18 129% Staff housing type B 21 8 7 33% 88% Staff housing type C 17 0 0 0% 0% Staff housing type D 53 18 10 19% 56% Guest house 1 1 1 100% 100% Dormitory 2 2 3 150% 150%

Tukul house Const. 6 6 100% Staff cafeteria 1 0 0% Cattle crashes 11 Livestock market place 12 10 83% Livestock market place improvement 17 8 47% Shelter for market technicians 7 5 71% Loading ramp 7 5 71% 246 246.00 138 132 54% 96%

ANNEX 8

Page 2 of 2 Infrastructure Development Component:

Water Development Birkas 40 12 19 48% 158% ponds 50 37 42 84% Pond rehabilitation 36 33 92% shallow wells 75 75 68 91% 91%

Shallow well rehabilitation 24 10 42% Boreholes 2 1 1 50% 100% Spring Development 5 5 100%

Diversion channel construction 18 16 89% Water Trough 6 2 33% 167.00 214 196 117% 92% overall performance with each subcomponent carrying equal weight 72% 86%

ANNEX 9 Page 1 of 2

ETHIOPIA SOUTHEAST RANGELANDS PROJECT

Implementation Performance

Component indicators Score (1-4) Remarks 1) Adherence to time schedule 1 Delay of 11 months 2) Adherence to cost schedule 2 Disbursement about 78% 3) Compliance with loan covenants 2 Most covenants fulfilled 4) Adequacy of monitoring and evaluation and reporting

2 quarterly progress reporting irregular; audit reporting poor; PSC ineffective

5) Satisfactory operations (if applicable) 1 Total 8 Overall assessment of implementation performance

1.6 Unsatisfactory

Bank Performance Component indicators Score (1-4) Remarks 1) At identification 3 Pilot study, consultant prepared a study and proposal for the project 2) At preparation of project 2 Project did not take into consideration issues of sustainability and

long-term impact 3) At appraisal of project 2 Project did not take into consideration issues of sustainability and

long-term impact 4) At re-appraisal 2 Project was complex 5) At supervision of project 1 6 supervisions in 10 years. The project was supervised every year in

the last four years which revived the project, no mid-term review Total 10 Overall assessment of Bank performance 2.0 Satisfactory

Project Outcome Component indicators Score (1-4) Remarks 1) Relevance and Achievement of Objectives (i) Macro-economic policy 1 Change of government which led to changes in policies affecting the

project design and scope (ii) Sector policy 1 As above (iii) Physical (inc. production) 3 Project made substantial achievements on the ground (about 70% of

objectives achieved) (iv) Financial 2 Disbursement disrupted by frequent suspensions and counterpart

funding not adequate and timely (v) Poverty alleviation & social & Gender 3 Social institutions were built, women were empowered, communities

were provided with access roads, markets, watering points etc. (vi) Environment 3 The project provided Tree planting, erosion control, trained the

communities on range management etc (vii) Private sector development 2 Not all the services e.g seed nurseries were privatised as envisaged. (viii) Other (specify) - 2) Institutional Development (ID) (i) Institutional framework & restructuring 3 The project was instrumental in establishing community

organizations such as the Degaan councils, women’s groups etc (ii)Financial & Management information systems including audit systems

1 Record keeping was not according to internationally acceptable accounting standards

(iii) Transfer of technology 3 Project effectively introduced erosion control techniques, energy saving technology, Pastoral animal health care workers, micro-enterprises etc

(iv) Staffing by qualified persons (incl. turnover), training & counterpart staff

3 TA & counterpart staffing were however not well phased with project activities

3) Sustainability (i) Continued Borrower commitment 3 Most project staff were absorbed by the civil service, GOE indicated

interest in a second phase (ii) Environmental policy 1 The policy exists but sustainability doubtful (iii) Institutional framework 1 Problematic, the institution built as a result of the project has been

dismantled. (iv) Technical viability and staffing 1 Doubtful, technically qualified staff exist but morale is low and GOE

ability to retain them low (v) Financial viability including cost recovery systems 1 Doubtful – the community associations ability to service and

maintain the facilities weak (vi) Economic viability 2 The infrastructure established has stimulated local economy and the

ANNEX 9 Page 2 of 2

availability of services to the local communities (vii) Environmental viability 2 Terracing established, trees planted, water points protected , there is

potential for erosion along the built roads (viii) O&M facilitation (availability of recurrent funding, foreign exchange, spare parts, workshop facilities, etc.)

1 All vehicles procured under the project are grounded due to lack of spare parts

4) Economic Internal Rate of Return N/A Total 37 Overall assessment of outcome 1.9 Unsatisfactory

ANNEX 10

RECOMMENDATIONS AND FOLLOW-UP MATRIX

Main findings & conclusions Lessons learned Recommendations

Follow-up actions

Responsibility

Formulation and Project Rationale: Project formulation did not take in accountant political realities (e.g. governance & stability)

Governance is now incorporated in all project designs

None Bank Group/ Government of Ethiopia

Project Implementation: Weak coordination because of independent institutions authorized to management technical and financial components of the project Cost under-utilization because of inefficient disbursement and poor utilization of project funds

Fragmented Project Implementation arrangements should be avoided. Frequent changes in management impacts negatively on project implementation and impact Where projects have difficulties following Bank Group procedures, The Bank should intensify training and exposure

None Future Projects

Bank Group/ Government of Ethiopia Bank Group/ Government of Ethiopia

Compliance with Loan Conditions & Covenants: Loan conditions are not realistic and often do not consider the reality of the country

Project Appraisal should tune into the reality on the ground and set conditions accordingly

Future Projects

Bank Group/ Government of Ethiopia

Sustainability: subsidized credit facilities

Provision of credit on a subsidized basis is not sustainable and should be avoided

Future Projects Bank Group/ Government of Ethiopia