Document o f The World Bank

FOR OFFICIAL USE ONLY

Report No: 42 17 1 -ET

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED GRANT

IN THE AMOUNT OF SDR 18.8 MILLION (US$30 MILLION EQUIVALENT)

TO THE

FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

FOR A

NUTRITION PROJECT

April 1,2008

Human Development I11 Country Department East 3 Africa Region

This document has a restricted distribution and may be used by recipients only in the performance o f their off icial duties. I t s contents may not otherwise be disclosed without World Bank authorization.

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CURRENCY EQUIVALENTS

B C C BCR BF BPR CAS CBN CF CHD CIDA CGP CMM CPAP C P A R CQS CSA cso C T C DA D H S D P DPPAiDPPBiDPPO DSS EHNRI E M C P ENA ENCU EOS ESHE E S W ETB E W S FA FHD FM FMOH FSP GDP GOE HEEC H E P HEW H M I S HR

Exchange Rates (Effective February 29, 2008) Currency Unit Ethiopian Birr (ETB)

US$ 1 = SDR0.6269 ETB9.50 = US$ 1

Ethiopian Fiscal Year (EFY)

ABBREVIATIONS AND ACRONYMS

Behavior Change Communication Benefit-Cost Ratio Breastfeeding Business Process Re-engineering Country Assistance Strategy Community-Based Nutr i t ion Complementary Feeding Community Health Day Canadian International Development Agency Child Growth Promotion Community Management o f Malnutr i t ion Country Program Act ion Plan Country Procurement Assessment Report Consultant Quality Selection Central Statistical Agency Civil Society Organization Community-based Therapeutic Care Development Agent Demographic and Health Survey Development Partner Disaster Prevention and Preparedness AgencylBureadOff ice Demographic Surveillance Site Ethiopian Health and Nutr i t ion Research Inst i tute Expenditure Management and Control Sub-program Essential Nutr i t ion Actions Emergency Nutr i t ion Coordination Unit Enhanced Outreach Strategy for chi ld survival Essential Services for Health in Ethiopia Economic Sector W o r k Ethiopian Birr Early Warning System Fiduciary Assessment Fami ly Health Department Financial Management Federal Ministry o f Health Food Security Project Gross Domestic Product Government o f Ethiopia Health Extension and Education Center Health Extension Programme Health Extension Worker Health Management Information System Human Resources

FOR OFFICIAL USE ONLY

HSDP IA IBEX ICB IDA IDD I D S R I E C IFR IMCI IMR IRT JBAR JICA LBW LIC L C S M&E MI MDG MDTF MERET

MOE MOFED NCB NI IS NGO NMR NNCB N N P N N S NRD Nu OFAG OR ORS OTP P A D PASDEP PBS P D O P E M P F M PFSA P I M P L W PPA PPD P P M PPT PSCAP PSNP PRSP QBS QCBS

Health Sector Development Programme (currently in 31d phase) I r o n Deficiency Anaemia Integrated Budget and Expenditure International Competitive Bidding International Development Association Iodine Deficiency Disorder Integrated Disease Surveillance and Response Information Education Communication In ter im Financial Report Integrated Management o f Childhood Illness Infant Mortal i ty Rate Integrated Refresher Training Joint Budget and Aid Review Japan International Cooperation Agency L o w Birth Weight Letter o f Credit Least-Cost Selection Monitoring and Evaluation Micronutrient Init iative Mi l lennium Development Goal Mult i-Donor Trust Fund Managing Environment Resources to Enable Transition to more sustainable livelihoods (WFP) Ministry o f Education Ministry o f Finance and Economic Development National Competitive Bidding Nutr i t ion InformatiodSurveil lance Non-Governmental Organization Neonatal Mortal i ty Rate National Nutr i t ion Coordinating B o d y National Nutr i t ion Program National Nutr i t ion Strategy Nutr i t ion Research Department Nutr i t ion Unit Off ice o f the Federal Auditor General Operational Research Oral Rehydration Salts Outpatient Therapeutic Programme Project Appraisal Document Plan for Accelerated and Sustained Development to End Poverty Protection o f Basic Services Project Development Objective Protein-Energy Malnutr i t ion Public Financial Management Pharmaceutical Fund and Supply Agency Program Implementation Manual Pregnant and Lactating Women Public Procurement Agency Planning and Programming Department Project Preparation Manual Project Preparation Team Public Sector Capacity Building Project Productive Safety Ne t Program Poverty Reduction Strategy Paper Quality -Based Selection Quality Cost-Based Selection

restricted distribution and may be used by recipients only in the performance o f their off icial duties. I t s contents may not be otherwise disclosed without Wor ld Bank authorization.

RHB S B D S I L SNIiS SNNPR SOE SSA SWAP TFP TFU TSF UNICEF U S A I D us1 USMR VAD V C H P W A S H WFP WHO W M S WODPPO WOHO

Regional Health Bureau Standard Bidding Document Specific Investment Loan Strengthening Nutr i t ion InformatiodSurveil lance Southern Nations, Nationalities and Peoples Region Statement o f Expenditure Sub-Saharan Afr ica Sector Wide Approach Therapeutic Feeding Program Therapeutic Feeding Unit Targeted Supplementary Food United Nations Children’s Fund Uni ted States Agency for International Development Universal Salt Iodization Under-5 Morta l i ty Rate Vi tamin A Deficiency Volunteer Community Health Promoter Water, Sanitation and Hygiene W o r l d Food Programme W o r l d Health Organization Welfare Monitoring Survey Woreda Disaster Prevention and Preparedness Off ice Woreda Health Off ice

Vice President Obiageli Kat ryn Ezekwesil i Country Director: Kenichi Ohashi

Sector Director: Y a w Ansu Act ing Sector Manager: John Elder

Task Team Leader: Andrew Sunil Rajkumar

ETHIOPIA Nutrition Project

CONTENTS PAGE

I. STRATEGIC CONTEXT AND RATIONALE ........................................................................... - 1 - A. COUNTRY AND SECTOR ISSUES .......................................................................................... B. RATIONALE FOR BANK INVOLVEMENT .................................................................................. c. HIGHER-LEVEL OBJECTIVES TO WHICH THE PROJECT CONTRIBUTES ...............

11. PROJECT DESCRIPTION ........................................................................................................... - 5 - A. LENDING INSTRUMENT ..................... ............................................................................ B. PROJECT DEVELOPMENT OBJECTIVE KEY INDICATORS ................................................ C. PROJECT COMPONENTS ........................................................................................................ D. LESSONS LEARNED AND REFLECTED IN THE PROJECT DESIGN ........................................................... 7 - E. ALTERNATIVES CONSIDERED AND REASONS FOR REJECTION ...................................................

111. IMPLEMENTATION ............................................................................................................... - 9 - A. PARTNERSHIP ARRANGEMENTS ,. .............................. ............................................................ - 9 - B. INSTITUTIONAL AND IMPLEMENTATION ARRANGEMENTS ................................................................... 9 - D. SUSTAINABILITY ............................................................ ............................................................... 10 - E. CRITICAL RISKS AND POSSIBLE C ~ N T R ~ V E R S ~ A L ASPECTS ............................. ...................... - 11 - F. GRANT CONDITIONS AND COVENANTS ......................................... ...................................

IV. APPRAISAL SUMMARY ...................................................................................................... - 15 - A. ECONOMIC AND FINANCIAL ANALYSES ............................................................................................ 15 - B. TECHNICAL ....................................................................................................................................... 15 - C. FIDUCIARY ........................................................................................................................................ 16 - D. SOCIAL .................................................................................................... ................................... 17 - E. ENVIRONMENTAL ............................................................................................................................... 17 - F. SAFEGUARD POLICIES ....................................................................................................................... 18 - G. POLICY EXCEPTIONS AND READINESS ................................................................................................. 18 -

L i s t o f Annexes

Annex 1: Country and Sector or Program Background ................................................. 19 - Annex 2: Major Related Projects Financed by the Bank and/or other Agencies .........- 27 - Annex 3: Results Framework and Monitoring ............................................................ - 29 - Annex 4: Detailed Project Description ........................................................................ - 32 - Annex 5: Project Costs ................................................................................................. - 38 - Annex 6: Implementation Arrangements ..................................................................... - 39 - Annex 7: Financial Management and Disbursement Arrangements ........................... - 45 - Annex 8: Procurement Arrangements ........................................................................... 59 - Annex 9: Economic and Financial Analysis ................................................................ - 66 - Annex 10: Description o f National Nutr i t ion Program ................................................ - 70 -

Annex 12: Safeguard Policy Issues .............................................................................. - 96 - Annex 13: Project Preparation and Supervision .......................................................... - 97 -

Annex 11 : Key Performance Indicators for National Nutr i t ion Program .................... - 90 -

Annex 14: Documents in the Project F i le .................................................................... - 98 - Annex 15: Statement o f Loans and Credits ................................................................. - 99 - Annex 16: Country at a Glance ................................................................................... 100 - Annex 17: M a p IBRD 33405 R1 ................................................................................ 102 -

ETHIOPIA NUTRITION PROJECT

FY Annual Cumulative

PROJECT APPRAISAL DOCUMENT

FY08 FY09 FYlO F Y l l FY12 3.0 8.0 8.0 7.0 4.0 3.0 11.0 19.0 26.0 30.0

Africa Region Office AFTH3

Date: April 1,2008 Country Director: Kenichi Ohashi Acting Sector Manager: John Elder Project ID: P106228 Lending Instrument: Sector Investment Lending

Team Leader: Andrew Sunil Rajkumar Sectors: Health Themes: Nutrit ion Environmental screening category: C

For Loans/Credits/Others: Total Bank financing (USsm.): 30.00 Proposed terms: Standard Grant

Borrower: Ministry o f Finance and Economic Development Federal Democratic Republic o f Ethiopia P. 0. B o x 1037 Addis Ababa, Ethiopia Tel: 011-122-6698 Email: ifdid@,ethionet.et

Responsible Agency: Federal Ministry o f Health P. 0. Box 1234 Addis Ababa, Ethiopia Tel.: 01 1-551-701 1 Email: fhd fmoh@,ethionet.et

Expected effectiveness date: July 8, 2008 ExDected closing date: Januarv 7.2014

[ ]Yes [XINO

[ ]Yes [XINO

[ ]Yes [XINO [XIYes [ ] N o [XIYes [ ] N o

Does the project depart f rom the Country Assistance Strategy (CAS) in content or other significant respects? Does the project require any exceptions f rom Bank policies?

I s approval for any pol icy exception sought f rom the Board? Does the project include any critical r i sks rated “substantial” or “high”? Does the project meet the Regional criteria for readiness for implementation? Project development objective:

Have these been approved by Bank management? [ ]Yes [ IN0

T o improve chi ld and maternal care behavior, and increase utilization o f key micronutrients, in order to contribute to improving the nutritional status o f vulnerable groups. Project description:

Component 1 : SUPPORTING SERVICE DELIVERY. This component will provide support to: (i) Community-Based Nutr i t ion which wil l strengthen and support the provision o f community-based nutrition and health services, fully uti l izing the existing Health Extension Program outreach and model household service provision structure; and (ii) Micronutrient Interventions which wil l enhance the appropriate utilization o f key micronutrients, especially iodine, iron, Vi tamin A and zinc.

Component 2: INSTITUTIONAL STRENGTHENING AND CAPACITY BUILDING. This component will provide support to: (i) Strengthening Human Resources and Capacity Building which will support coordination mechanisms for nutrition at different levels, institutional capacity building for implementing units and activities at different levels o f Government (including human resources strengthening) and training and capacity building o f research and training institutions; (ii) Advocacy, Social Mobil ization and Program Communication which will support a well-functioning communications strategy, identification o f priority behavioral change messages and systematic incorporation o f these into the communications systems in the health sector and in other sectors and use o f media to bring about nutrition-related behavior change; and (iii) Strengthening Nutr i t ion InformatiodSurveillance, Monitoring and Evaluation and Operational Research which will address the need to set up a proper nutritional surveillance system in Ethiopia. The activities supported will build o n existing data collection structures, wi l l undertake overall monitoring and evaluation for the National Nutr i t ion Program (NNP), and will also cover relevant operational research for the National Nutrit ion Program.

Which safeguard policies are triggered, if any? None Significant, non-standard conditions, if any. for: None Board presentation: none Conditions o f Effectiveness

Retention or assignment o f a financial management specialist for the Federal Ministry o f Health to support project financial activities, with qualifications, experience and terms o f reference satisfactory to IDA.

Adoption o f a Program Implementation Manual (including the Project financial management manual and Project chart o f accounts to report on Project activities, samples o f the formats for the interim financial reports, and terms o f reference for annual audits o f the Recipient’s Financial Statements, as wel l as the Project procurement manual) a l l in form and substance satisfactory to IDA.

Retention or assignment for the project o f two procurement specialists, one each at PFSA and EHNRI, with qualifications and experience satisfactory to IDA.

Legal Covenants

Financial covenants are the standard ones as stated in the Financing Agreement Schedule 2, Section I1 (B) on Financial Management, Financial Reports and Audits and Section 4.09 o f the General Conditions.

Dated Covenants

Establish, by July 7, 2009, the National Nutrit ion Coordinating Body;

Retain or recruit, by October 7, 2008, an external auditor for the Project, in accordance with terms o f reference satisfactory to IDA;

Furnish to IDA by July 7, 2010, evidence satisfactory to IDA, demonstrating that universal salt iodization (USI) regulations contemplated to be adopted and put in force for the proper implementation o f Proclamation No. 200/2000, have been adopted and are effectively in force in the country;

Complete the process for the official registration o f zinc as an essential drug with the Drug Administration and Control Authority, by July 7, 2010;

Joint reviews conducted, in conjunction with IDA and other NNP partners, not later than March o f each year, to review a l l matters relating to the progress o f the project and NNP.

I. STRATEGIC CONTEXT AND RATIONALE

A. Country and Sector Issues

1. Ethiopia has become inexorably l inked with images o f severe drought and large-scale starvation since the famine o f the mid-1980s. As the result o f national program efforts and a boost in GDP growth averaging 6.4% annually in recent yearsl, there have been some improvements in the indicators o f malnutrition among children under 5. While wasting remained unchanged at 1 1%, stunting among children under 5 years o f age declined from 52% in 2000 to about 47% in 2005. Underweight prevalence in under-5 children fel l f rom an estimated 45% in 1995 to 38% in 2005, a reduction o f 0.8 percent per year.

2. High population growth rates have contributed to a decline in farm sizes, while environmental degradation has deepened. Climatic variability i s high. Rainfall data for the period 1967 to 2000 indicates that annual variability in rainfall across different zones in Ethiopia ranged from a l o w o f 15% to a high o f 81% - among the highest in the world. The larger the coefficient o f variation in rainfall, the lower i s household income and consumption (Poverty Assessment, Wor ld Bank 2005). In addition to the failure o f the rains, health r isks - including both malaria and H IV /A IDS - exacerbate the vulnerability o f the poor, driving many thousands o f people into poverty traps. However, Ethiopia needs at least a 1.5 percentage points reduction in underweight prevalence per year - about double the present rate - to reach the 2015 target for MDG 1. And, despite the recent improvements, Ethiopia s t i l l has among the highest rates o f malnutrition in Sub-Saharan Africa. Protein-Energy Malnutrition (PEM) i s responsible for 13 7,000 child deaths a year. Stunting, one o f the markers o f PEM and largely irreversible after age 2, afflicts 47% o f children under 5. This i s very high by developing country as wel l as regional standards. Stagnation in wasting rates for urban children, in particular, i s also o f concern.

3. The prevalence o f malnutrition imposes significant costs o n the Ethiopian economy as wel l as society. The high mortality due to malnutrition leads to the loss o f the economic potential o f the child. Malnourished survivors require additional health care services, increasing the costs o f hospitalization and outpatient care in a country. In addition, there are productivity losses arising f rom impaired cognitive development and stunted physical stature. Ethiopia loses hundreds o f mill ions dollars o f productivity every year due to i t s comparatively high rates o f malnutrition. I t i s estimated that Ethiopia will lose approximately 144 b i l l ion ETB ($15.2 billion) between 2006-20152 or about 10% o f GDP, due to I ron Deficiency Anemia (IA), Iodine Deficiency Disorder (IDD) and stunting alone.

4. Micronutrient deficiencies are some o f the most prevalent disorders in Ethiopia. IDD, Vitamin A Deficiency (VAD) and IA affl ict a high proportion o f the population and cause bil l ions o f ETB in lost earnings to the poorest households. VAD, which damages the immune system o f a child and lowers resistance to common infections and leads to about 80,000 deaths a year, affects 61% o f under-5 children. IDD robs 3.5 mi l l ion Ethiopian children o f as many as 15 IQ points, reduces their abil ity to learn and concentrate, causes high drop-out rates in primary schools and substantially reduces the benefits o f Ethiopia’s large investments in schools and education. IA has far-reaching effects on labor productivity among adults and intellectual development o f children, in turn affecting learning ability and schooling success. Anemia affects 54% o f children under 5 and 27% o f women.

5. A very large proportion o f women do not practice appropriate breastfeeding (BF) and complementary feeding (CF) behavior. About a third o f babies do not BF within one hour o f birth and only one in three children age 4-5 months i s exclusively breastfed. There are also an increased number o f

F r o m 200212003 to 2004/2005, according to the Plan for Accelerated and Sustained Development to End Poverty, 1

2006.. ’ Ethiopian PROFILES.

- 1 -

children aged 6 to 9 months who are not breastfed at all. The result i s that about 50,000 infant deaths or 18% o f al l infant deaths a year are estimated to be caused by poor BF habits. Much o f the inappropriate BF behavior i s due to lack o f knowledge rather than practical or financial constraints in practicing such behaviors. This i s supported by the fact that there i s no evidence o f a positive relationship between wealth and optimal BF behavior. Therefore, education and introduction o f appropriate BF and CF practices are key to chi ld survival.

6 . Current BF behavior illustrates the critical importance o f factors other than economic growth for reducing malnutrition. Malnutrit ion indicators in Ethiopia are generally high for higher-income as wel l as lower-income households, and for some indicators there i s l i tt le difference between the two.

7 . Another key fact to consider when formulating pol icy against malnutrition i s that food insecurity i s only one o f the reasons for malnutrition. As demonstrated in recent Economic and Sector Work (ESW) done by the Wor ld Bank3, food security i s only one o f the factors affecting nutritional status. Ethiopia’s high malnutrition rates are also attributable to a range o f other non-food factors, including appropriate breastfeeding, other feeding and child care practices, hygiene, health status and health interventions, immunizations, the perceived status o f women in society and adequate water and sanitation. This points to the importance o f addressing malnutrition using a multi-sectoral approach.

8. Until recently, the broad multi-sectoral factors contributing to malnutrition had been insufficiently emphasized, with the focus placed on addressing food security as the primary means to address nutritional insecurity. Traditionally, there has been a food-biased approach towards combating malnutrition in Ethiopia, but there has recently been a growing understanding o f the multidimensional and multi-sectoral characteristics o f nutrition among policy makers in Ethiopia.

9. Based o n a thorough assessment and analysis o f the situation, the National Nutrit ion Strategy (NNS) was formulated during 2005/2006. The N N S assessment showed the importance o f a multi-sectoral approach addressing food as wel l as non-food factors including, in particular, those related to health.

10. In September 2006, the Government o f Ethiopia (GOE) adopted i t s second five-year Plan for Accelerated and Sustained Development to End Poverty (PASDEP) covering 2005-20 10. The Ethiopia PASDEP explicitly called for the implementation o f the N N S and an Act ion Plan to achieve the Mi l lennium Development Goal (MDG) for halving poverty and hunger by 20 15.

1 1. Although nutrition i s recognized in the N N S as being multi-sectoral, overall responsibility for i t has been given to the Federal Ministry o f Health (FMOH). The National Nutrit ion Program (NNP) was developed in order to implement the N N S . FMOH i s taking the lead role in overseeing the NNP and implementing key aspects o f it, but other ministries and sectors are also involved in the process. The importance and critical need for a multi-sectoral approach, with committed involvement f rom al l relevant sectors, i s stressed in the N N S .

12. The N N S was officially approved and launched on February 7 , 2008 in a high-profile ceremony presided over by the Deputy Prime Minister and Minister for Agriculture and Rural Development H.E. A to Adissu Legesse, as wel l as the Minister for Health H.E. Dr. Tedros Adhanom. Bo th gave speeches stressing the importance o f a multi-sectoral approach to combating malnutrition in the country. Speeches were also given by the State Ministers o f Education and Water Resources, as well as by the Director- General o f the Disaster Prevention and Preparedness Agency. Also present was the State Minister o f

See “Malnutrit ion in Ethiopia: Current Interventions, Successes, Cost-Benefit Analysis, and the W a y Forward” 3

Draf t Report, W o r l d Bank. December 2007.

- L -

Finance and Economic Development, underlining the critical role played by the Ministry o f Finance and Economic Development in the entire process.

13. The NNP i s a long-term program, with the f i r s t phase spanning the five years f rom July 2008 to June 2013.4 The NNP i s multi-sectoral; NNP interventions that are relevant to the health sector are incorporated in the Health Extension Program (HEP), a flagship government program that began in 2003. The HEP involves the training and placement o f female Health Extension Workers (HEWs) in basic curative and preventive health care services as wel l as education on various health topics in every community. The a im i s to place two HEWS in each kebele (community), and at the same time to expand the physical health infrastructure by building one health post in each kebele. T o support the HEWS in their work, community volunteers will be trained and work in the kebeles. HEWS are given extensive training in 16 health topics as wel l as personal development training. By December 2007, 24,600 HEWS had been trained and deployed. It i s planned that a l l 30,000 HEWs will be trained by 2009.

14. One key aspect that the N N S emphasizes i s the need for proper nutrition informatiodsurveillance (NUS). In Ethiopia, i t i s currently impossible to obtain localized information on nutritional indicators at the kebele or even the woreda levels, except on a sporadic basis. Reviews o f Ethiopia’s nutrition situation and programs consistently end in recommendations to establish a proper and comprehensive NYS. Such a system would be able to track localized nutritional indicators at a large number o f focal points, so that the nutritional status o f households in different localities could be tracked over time, at the woreda and kebele levels. A properly functioning NUS can identify constraints, determine i f project objectives are being met, provide information to improve targeting, assess quantity, quality and timeliness o f project inputs and inform decision making at each level o f government.

B. Rationale for Bank Involvement

15. The NNP represents a partnership between the GOE and development partners (DP) and i s the main vehicle for implementing the N N S . The NNP harmonizes various nutrition-focused programs and interventions into an integrated program. The harmonization and coordination aspects are key because there are already several programs in the country - some o f them quite large - affecting nutrition, but these operate largely independently o f each other. The present proposed International Development Association (IDA) project would finance critical activities in support o f the NNP, as further described below.

16. The forthcoming Ethiopia Country Assistance Strategy (CAS) covering the period 2008-201 1 wil l a im to support Ethiopia in sustaining i t s emerging ‘dual take-off in economic growth and basic services delivery. The strategy includes nutrition as a key element o f the Bank’s support on both growth and services, due to i t s impact on productivity and health. As such, the proposed project i s seen as a critical building block o f the CAS lending program.

17. The Bank’s role in this proposed NNP i s key, for a number o f reasons:

0 The proposed nutrition project would be in support o f implementation o f the N N S which i s a key action o f PASDEP 2005-2010, the GOE’s latest Poverty Reduction Strategy Paper (PRSP).

0 The GOE has asked the Bank for technical assistance and a contribution in support o f the NNP.

See Annex 10 for a description o f the NNP. 4

- 3 -

0 The proposed nutrition project in Ethiopia i s consistent with the Afr ica Act ion Plan, which calls for scaling-up nutrit ion actions in at least eight countries with the worst nutrition indicators

0 The Bank i s best placed to take the lead role in the efforts to strengthen coordination and linkages among different programs and sectors. This i s because o f the Bank’s involvement in a range o f different programs, sectors and multi-donor operations in Ethiopia (e.g. in agriculture, water, infrastructure and others; and involving the public as well as private sector). The Bank currently plays the main leadership and coordination role in other multi-donor operations l ike the Productive Safety Nets and Protecting Basic Services operations, as well as the coming Education Quality Improvement Program (FY09).

0 The Bank can play a key role as a catalyst for the participation o f other donors, for the adherence to a harmonized and integrated approach with the aim o f implementing the N N S , and to ensure the implementation o f key policies.

0 Nutrit ion interventions have extremely high benefit-cost ratios (BCR), as has been demonstrated by the recent ESW on Malnutrition’ in Ethiopia.

C. Higher-Level Objectives to which the Project Contributes

Achievement of the Goals o f the National Nutrition Strategy (NNS) and the Health Extension Program (HEP)

18. The proposed project will fund critical activities in support o f the NNP, spanning the period July 2008 to June 201 3. The NNP will be the vehicle to implement the N N S , which was officially approved in February 2008. Implementation o f the N N S i s explicitly called for in the government’s second five-year PASDEP 2005-20 10.

19. Nutrit ion i s multi-sectoral and i s affected by interventions and programs in several sectors including health. The project largely supports a subset o f the interventions relevant to the health sector. These interventions, and others that are a part o f the NNP and relevant to the health sector, are a part o f the GOE’s Health Extension Program (HEP). This i s a flagship program and i s an integral part o f the government’s third Health Sector Development Program (HSDP-111).

Progress Towards the Millennium Development Goals (MDGs)

20. The project will help achieve several o f the MDGs. Among other things, progress regarding the f i rs t MDG (eradicate extreme poverty and hunger) will be measured by tracking the percentage o f under- 5 children that are underweight6. This i s a Higher-Level Indicator for the project; the activities o f the project and o f the NNP as a whole aim to have a significant impact o n this indicator.

21. The focus o f the project (and NNP) interventions i s mostly on under-5 children and o n pregnant and lactating women. In this regard, there will be a significant boost to achieving M D G 4 (reduce chi ld mortality) and M D G 5 (improve maternal health). The expected impact o n chi ld mortality i s especially

See “Malnutrition in Ethiopia: Current Interventions, Successes, Cost-Benefit Analysis, and the Way Forward”.

Children whose weight-for-age i s below minus two standard deviations from the median of a WHO-chosen

5

Draft Report, World Bank. December 2007.

reference population are classified as underweight.

6

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high, given that about ha l f o f a l l child deaths are estimated to have arisen fkom malnutrition. About 20% o f infant deaths are estimated to be attributable to sub-optimal breastfeeding behavior, which the project and NNP aim to change through behavior change communication (BCC) activities.’ Improvements in nutritional status will also help to address outcomes relevant to HIV/AIDS, malaria and other diseases (MDG6).

22. There wil l be a significant impact on M D G 2 (achieve universal primary education), and in general on educational outcomes, given the well-demonstrated link between malnutrition and educational outcomes. As an example, the project and NNP aim to achieve universal salt iodization (USI). A nationwide survey conducted in 20058 concluded that only 4% o f Ethiopian households used adequately iodized salt, even though inadequate iodine intake has been shown in studies worldwide to result in a reduction o f about 10 to 15 points in IQ.

11. PROJECT DESCRIPTION

A. Lending Instrument

23. The Bank will utilize a Specific Investment Loan (SIL) instrument to provide an IDA Grant o f 18.8 mi l l ion SDR or US$30 mi l l ion equivalent for the project. This will be allocated across two components: Component 1 (Supporting Service Delivery) and Component 2 (Institutional Strengthening and Capacity Building). The proposed project implementation period i s five (5) years with a proposed effectiveness date o f July 8, 2008 and expected closing date o f January 7, 2014.

B. Project Development Objective and Key Indicators

24. The Project Development Objective (PDO) i s to improve chi ld and maternal care behavior, and increase utilization o f key micronutrients, in order to contribute to improving the nutritional status o f vulnerable groups.

25. Progress in terms o f achieving the PDO will be measured by tracking: (i) the percentage o f infants aged 0-5 months exclusively breastfed; (ii) the percentage o f households using adequately iodized salt; and (iii) the percentage o f pregnant women receiving i ron and folate supplementation.

C. Project Components

Overview

26. The GOE i s embarking on a NNP with the support o f DPs. The first phase o f the NNP spans five years (2008-2013), and i s described in detail in Annex 10. The proposed IDA Nutrit ion Project i s a self- contained project that would finance critical activities in support o f the NNP. The success o f these critical activities i s expected to be the foundation for the development o f the rest o f the NNP. The proposed project will consist o f two main components: a Supporting Service Delivery component (Component 1) and an Institutional Strengthening and Capacity Building component (Component 2) to support the service delivery. T h e amounts to be provided to these two components wi l l be $14 mi l l ion and $16 mi l l ion respectively.

’ These estimates are f r o m the Ethiopian PROFILES, and they are in accordance with estimates from other poorer countries.

Conducted by the Ethiopian Health and Nutr i t ion Research Institute (EHNRI) 8

27. The description o f activities immediately below and in Annex 4 applies only to the proposed IDA project. The implementation, fiduciary and procurement arrangements described in Annexes 6, 7 and 8 o f this document also apply only to this project. A full description o f the NNP as a whole i s given in Annex 10.

Component 1 of Proposed IDA Project: Supporting Service Delivery ($14 million from IDA)

28. Component 1 will support two areas: Community-Based Nutrition (CBN) and Micronutrient Interventions. The focus o f the supported CBN activities will be on Health Extension Workers (HEWs) and supervisors o f HEWs. The government i s ro l l ing out a program nationwide whereby 30,000 HEWs will be deployed - two in every kebele (community) - by the end o f 2009. The government will soon introduce a program whereby supervisors o f HEWs will be deployed at health centers, totaling 3,200 by year 2009.

29. Providing C B N services i s a part o f the HEWs’ function, and will be supported by HEW supervisors. The project will strengthen and support this role, especially by supporting relevant training activities and materials. The focus will be to provide C B N services through outreach to the community and using model households identified in the community as an integral part o f the HEP. C B N will expand geographically in a manner consistent with HEP expansion.

30. CBN activities will a im at: (i) building community capacity for assessment, analysis and action specific to preventing child malnutrition (Triple-A approach - Assess, Analyze and Act ion - involving sensitization efforts at woreda, kebele and gotte (village) levels, followed by community mapping, community-based action and participatory assessments o f progress); (ii) promoting improved caring practices for children and women to prevent malnutrition; (iii) improving referral linkages to relevant chi ld health and nutrition services and other linkages for addressing non-health causes o f chi ld malnutrition; (iv) developing and implementing a strong advocacy and communicatiodmobilization strategy to support a l l C B N activities; and (v) enhancing capacity for C B N implementation at region and woreda levels.

3 1. Component 1 will also support selected Micronutrient Interventions, focusing on critical activities to enhance the appropriate utilization o f key micronutrients, especially iodine, iron, Vi tamin A and zinc. Regulation and procedures to prohibit the production or distribution o f salt that i s not iodized, or inadequately iodized, wi l l be enacted and enforced. Zinc will be registered as an essential drug so that health workers and HEWs can administer it for therapeutic purposes, especially in conjunction with the use o f Oral Rehydration Salts (ORS) therapy in cases o f child diarrhoea. The project will also support the purchase and operations/delivery costs for key micronutrients. The above inputs will be complemented by appropriate technical assistance.

Component 2 of Proposed IDA Project: Institutional Strengthening and Capacity Building ($16 million from IDA)

32. Component 2 will Strengthen Human Resources and Capacity Building through various means. First, i t will support multi-sectoral coordination mechanisms, addressing both pol icy and technical aspects, including the establishment o f a National Nutrit ion Coordination Body (NNCB) with high-level membership f rom different nutrition-related sectors. Implementing entities for the NNP and for the IDA project will also be strengthened in line with their additional functions. The strengthening will take the form o f human resources strengthening as wel l as logistics support. Component 2 also aims at strengthening (through training and capacity building) the capacity o f fkontline workers, mid-level managers working on nutrition-related areas (those working at woreda health offices and regional health bureaus); clinical nutritionists; and higher-level “supernutritionists” (e.g. those working at higher-level

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institutions). EHNRI has been selected to strengthen the local research capacity, as it i s the leading institution for undertaking health and nutrition research.

33. This component will also support Advocacy, Social Mobilization and Program Communication activities, with the following overall aims: (i) generate ownership o f the country’s nutrition agenda by government and non-government decision makers, stakeholders and the public at large; (ii) identify the highest priority nutrit ion messages in need o f dissemination and the constraints and resistance points presently limiting changes in practices; (iii) incorporate these messages systematically into various communications channels including mainstream media, community radio, “community conversations” and materials o f the health sector and other sectors; and (iv) complement the efforts o f HEWS and Volunteer Community Health Promoters9 (VCHPs)/model households to promote appropriate caring practices among care providers, communities and service providers through CBN with behavior change messages in various communications media.

34. Finally, this component will support Strengthening Nutrition InformatiodSurveillance (SNUS), Monitoring and Evaluation (M&E), and Operational Research (OR). These activities will provide information for M&E activities regarding the various NNP interventions and will also strengthen nutritional surveillance. They will provide information to support other programs and enhance understanding o f their impacts o n nutrition, including the HEP, EOS and PSNP, as wel l as various food security programs and programs affecting disastedepidemic prevention, preparedness and response. They will work by strengthening existing systems including the Health Management Information System (HMIS), Integrated Disease Surveillance and Response system (IDSR) and Demographic Surveillance Sites (DSS). The various sources o f data collected, in particular surveys with national coverage, wi l l be used for the overall evaluation o f the NNP. The diverse sources o f available data wil l be consolidated and analyzed to produce outputs that will be useful for policymakers and specifically for decisions about program design. In addition, relevant operational research for the NNP will be supported.

D. Lessons Learned and Reflected in the Project Design

3 5 . Good experience in previous projects with micronutrient and behavior change interventions; both have very high-benefit cost ratios (BCR), but particularly the former. Previous nutrition projects have generally provided good experiences in improving indicators o f access to micronutrients and related interventions. When wel l designed, they have also achieved significant success in improving knowledge and practice o f optimal nutrit ion behavior (e.g. regarding exclusive breastfeeding and complimentary feeding), although there usually remains some gap between knowledge and practice. Regarding the latter, recent experience in Ethiopia with the Essential Services for Health in Ethiopia project” has been very good in terms o f promoting optimal breastfeeding behavior and handwashing (according to midline survey results), with these interventions determined to have benefit-cost ratios o f 26 and 7 respectively (using project-specific figures) in the recent ESW produced by the Wor ld Bank (2007). This same ESW calculated the benefit-cost ratios for micronutrient interventions in Ethiopia as even higher, exceeding 50.

36. Mixed experience with demonstrating change in Protein-Energy Malnutrition (PEM) Indicators. The experience with improving PEM in nutrition projects, as measured by indicators such as stunting, wasting and underweight, has been more mixed. This i s because these indicators are affected in part by a range o f factors (e.g. droughts, health access, water and sanitation access) outside the control o f such projects. P E M indicators should thus be excluded from the set o f Project Outcome and Intermediate Indicators, which are typically used to determine the success or failure o f the project. The Project

In some o f the documentation, these are referred to as Volunteer Community Health Workers. lo This i s a USAID-funded bilateral project focused on strengthening health workers’ skills and improving community and household practices.

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Outcome and Intermediate Outcome Indicators should instead focus on measures that are more directly under the control o f the project, such as indicators o f access, utilization and behavior change, or measurable indicators o f appropriate policy or process changes. However, i t i s appropriate and desirable to include P E M Indicators among the Higher-Level Objective Indicators.

37. Other lessons learned from previous projects can be summarized as follows:

(i) Community based nutrition and early childhood development activities should, in particular, target children below two years of age andpregnant women; this i s critical since the major damage caused by malnutrition takes place in the womb and during the f i rst two years o f l i fe, and this damage i s mostly irreversible. Early childhood education and cognitive development have also proved to be key in enhancing educational outcomes; interventions should begin at the under-2 stage.

(ii) A strong orientation towards management for results strengthens the sense of ownership and performance o f a l l stakeholders involved in project implementation. A well-designed nutritional surveillance and monitoring and evaluation framework i s critical for achieving outcomes.

(iii) Continuous capacity building at al l levels i s crucial for the success o f malnutrition reduction efforts.

(iv) Development of inter-sectoral coordination and collaboration i s very important for the establishment o f a coherent national program.

(v) Activities need to be suflciently broad and to have suflcient intensity, including adequate ratios of community volunteers to households in the case o f community based nutrition, and sufficient length and intensity o f init ial and refresher training which should be periodic.

E. Alternatives Considered and Reasons for Rejection

38. The team considered the possibility o f a program-based approach with other DPs included in the “program” via pooled financing arrangements or v ia parallel financing arrangements with Memorandums o f Understanding signed between partners. However, it was recognized that this would entail a significantly longer process than one focused on a stand-alone project (a projectized approach). Furthermore, complications arise f rom the fact that several partners are s t i l l in the process o f concretizing the nature and size o f their contributions.

39. Thus, the Bank has agreed with the GOE and DPs that, for now, the most appropriate lending instrument to fund the NNP would be a project-based Bank operation that would support a set o f more focused activities for which implementation can start quickly. This approach would enable the Bank to quickly process the proposed project to support more immediate and critical activities including institutional and capacity building activities. The proposed operation would also help jump start priority program activities that can be more easily measured and monitored.

40. During implementation, the Bank will continue to harmonize with other DPs through regular jo in t reviews, consultations and other collaborative mechanisms to ensure that the activities under the proposed project remain consistent with the GOE’s comprehensive and holistic approach as reflected in their program design. At mid-term, the Bank would assess progress achieved and re-evaluate conditions on the ground. Given positive results, i t would strongly consider the possibility o f providing more funds to support further achievement o f the objectives o f the NNP.

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111. IMPLEMENTATION

A. Partnership Arrangements

41. implemented by the GOE, with support f rom various DPs.

The proposed IDA project will fund critical activities in support o f the NNP. The NNP wil l be

42. The NNP will be administered through a multi-partner approach, with the proposed IDA project being harmonized with the NNP interventions funded by other DPs and by the GOE under a common co- ordination mechanism. Several DPs will use their own mechanisms (including financing and procurement) for contributing to the NNP, but others may wish to contribute through a Multi-Donor Trust Fund (MDTF) administered by the Wor ld Bank, in which case one or more such MDTFs will be set up, and a pooled funding approach may also be adopted.

B. Institutional and Implementation Arrangements

43. NNP i s the vehicle to implement the NNS, and the Federal Ministry o f Health (FMOH) has been designated as the lead implementation agency in this regard. Accordingly, the FMOH will be the lead agency overall in charge o f the NNP, but other agencies in other sectors will also play key implementing roles, which i s critical given the multi-sectoral nature o f the problem.

44. The FMOH will also be the lead implementing agency for the proposed IDA project, which will fund critical activities within the NNP. The FMOH will also be the lead implementing agency for the proposed IDA project, which will fund critical activities within the NNP. Key activities will be implemented by the Ethiopian Health and Nutrit ion Research Institute (EHNRI), which i s under FMOH but i s an autonomous agency that typically handles i t s own procurement and financial management (financial reporting etc.). Further details o f responsible agencies within FMOH are given in Annex 6.

45. Bureaus (RHBs) and the Woreda Health Offices (WOHOs).

FMOH will be supported for purposes o f implementation o f this project by the Regional Health

46. The GOE, including FMOH, i s currently undergoing a Business Re-engineering Process (BPR) which may lead to some restructuring o f certain agencies, or shifting o f some agencies within the government structure. This process i s not yet complete. During implementation o f the project, F M O H may engage the services o f other agencies that have expertise in specific project activities (such as the Emergency Nutrit ion Coordination Units for emergency nutrition surveillance activities, or the Central Statistical Agency (CSA) for statistics- or survey-related activities.

47. At the federal level, the government will establish: (i) a National Nutrit ion Coordinating Body (with high-level representation f rom different key ministries) that deals with policy issues; and (ii) a multi- sectoral National Nutrit ion Technical Committee that deals with technical issues. At the regional level, similar structures will be in place as for the federal level. The existing Woreda Development Committee i s proposed to oversee the coordination and implementation o f the NNP at the woreda level. All o f these bodies should have clear terms o f reference with details including the frequency o f meetings, key performance indicators (outcome and process indicators) as wel l as progress on policy formulation that should be monitored on a regular basis.

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C. Monitoring and Evaluation of Outcomes/Results

48. Monitoring and Evaluation (M&E) activities for the proposed IDA project as wel l as for the NNP as a whole are covered by Component 2 o f the proposed project. Primary responsibility for M&E will l ie with the EHNRI, which i s technically under the F M O H but has an autonomous designation. Among other things, there will be a baseline and endline survey carried out under the supervision o f EHNRI. EHNRI will oversee/manage the survey and evaluation activities, but will not implement them itself; the activities wil l be implemented by an independent bodybodies contracted by EHNRI.

49. Information f rom the surveys mentioned above will be supplemented by data sources as described in Annex 4, including: (i) Demographic and Health Surveys and Welfare Monitor ing Surveys, as wel l as other surveys including the micronutrient surveys with nationwide coverage conducted by EHNRI; (ii) routine data collected as part o f the Health Management Information System (HMIS); (iii) data from DSS managed by universities; (iv) data collected through the Emergency Nutr i t ion Coordination Units (ENCUs); and (iv) data collected through EOS/TSF activities.

50. These various data sources wil l provide a r i ch base with which to conduct M&E activities for the NNP and also to provide overall monitoring o f key indicators relevant to NNP as wel l as to other related programs in different sectors (e.g. those that address mostly food security). The data collected will enable analysis to be carried out to enhance understanding o f the various actors affecting nutrition and the impacts o f various interventions in different sectors. EHNRI will be overall in charge o f these activities, but i t will contract out some o f the work to outside bodies. The capacity o f EHNRI to undertake these additional responsibilities wil l be strengthened as an integral part o f the proposed IDA project.

5 1. Regular jo in t reviews involving the government and NNP DPs will take place. These will occur semi-annually before the project Midterm Review and annually thereafter. The project Midterm Review will coincide with the Midterm Review o f the f irst five-year phase o f the NNP. These jo int reviews will examine progress made and challenges faced regarding the project as wel l as the NNP and will make recommendations regarding next steps. Partnership arrangements will be examined, with a view to ensuring harmonization between the contributions o f the government and various DPs in terms o f technical, fiduciary and M&E aspects. Modifications to existing arrangements will be made as needed, based on these reviews.

52. The GOE team wil l produce an annual report for the project and for the NNP. This report will provide details and available evidence on progress, challenges and on overall implementation o f the project and the NNP.

D. Sustainability

53. The r isk o f lack o f sustainability i s minimal due to the following factors:

A key focus o f the project (and the NNP) i s on appropriate policy legislation and establishment o f appropriate inter-sectoral coordination mechanisms. These institutional changes are not dependent on the continued f low o f funding, and yet the impact on outcomes i s expected to be substantial.

M u c h o f the focus o f the project (and the NNP) i s on behavior change. This i s largely a question o f institutionalization o f appropriate knowledge and attitudes (and also institutionalization o f the communication o f appropriate knowledge and attitudes), which if done properly should be self- sustaining,

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The project mostly funds health aspects o f the NNP, and these are designed as a part o f the flagship Health Extension Program (HEP) managed by FMOH. There i s strong government ownership o f this program, and thus there i s minimal risk o f lack o f sustainability due to lack o f funding from the government andor i t s development partners. The Supporting Service Delivery Component (Component 1) i s designed to be harmonized with the ongoing rollout o f the HEP.

Part o f the burden o f malnutrition in Ethiopia will be reduced through economic growth. Ethiopia appears n o w to be on a sustainable growth path, registering real GDP growth rates o f 11.6% in EFY98 (FY06) and 11.4% (projected) in EFY99 (FY07) according to International Monetary Fund reviews, with a high rate also expected in EFYOO (FY08). (It should be noted, however, that economic growth alone would not suffice, since a substantial component o f malnutrition i s independent; e.g. certain malnutrition indicators are high even among higher-income households in Ethiopia.)

E. Critical Risks and Possible Controversial Aspects

The following i s a detailed l i s t o f critical risks, mitigation measures and r i sk ratings for the project. The overall risk rating for the project i s Moderate.

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Risk factors risk

I. Sector Governance, Policies and Institutions

Rating of Description of risk riswresidual Mitigation measures

Linkages with other ministries

Commitment o f GOE officials

Delay in passing agreed legislative/polic y actions

A key aspect o f a successful nutrition program i s to ensure effective linkages between different sectors, ministries and programs that affect or are affected by nutrition. These linkages need to be strengthened and coordination o f a l l related programs needs to be improved (including with programs that are not nominally in the NNP). There i s a r i sk o f this not happening in practice. Success o f the project and also NNP i s dependent o n the commitment o f key GOE personnel, especially at the higher levels, f rom the FMOH as wel l as other key ministries.

There are two key legislative/policy actions needed for the NNP to move forward, and both have been given timelines. Zinc needs to be registered as an essential drug by year 2, and Universal Salt Iodization (USI) policy needs to be adopted and enforced by year 2. There may be a risk o f delay in

S / M

M/M

M/L

The GOE has agreed on the need to establish a high-level National Coordinating Agency for nutrition activities to ensure coordination o f the various relevant government agencies. This i s stated in PASDEP as a key action to be taken. In addition, the project will support other mechanisms for inter-sectoral coordination (see Annex 6). F M O H will play an active leadership role in ensuring coordination, and providing strategic guidance/direction in the implementation the N N S . An entire sub-component o f the NNP wil l be devoted to strengthening linkages and coordination between key players. There are also provisions to ensure that appropriate M&E mechanisms are in place to monitor and evaluate outcomes, including those relevant to different sectors (see section on Monitoring and Evaluation o f OutcomesResults).

There has been strong commitment and competence shown by key FMOH staff including the Health Minister and State Minister for Health. K e y ministers and high- level personnel f rom other ministries have also expressed strong support for the N N S and the NNP. This support was shown by the presence o f several ministers including the Deputy Prime Minister at a high-level ceremony where the N N S was officially approved and launched in February 2008. From the beginning, i t has been made clear that these actions need to be taken by the GOE, and the GOE has indicated firm commitment regarding them. There i s a lo t o f international pressure to legalize zinc in Ethiopia, and this wil l add to l ikely success. US1 would mandate that al l salt produced and distributed in the country has to be adequately iodized. However, there i s fear that the small salt producers may not al l conform immediately. The large salt producers, accounting for at least 50% o f the salt, are already in place to start iodization. Despite the possible delay in fully implementing USI, a

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Intra-sectoral coordination

11. Operation-SI Technical/design

Donor coordination

Lack o f :ompliance in Laking drugs

these actions.

There i s also the risk o f poor intra-sectoral coordination among relevant agencies within the FMOH and within the health sector.

cific Risks Reporting f rom different implementers might not be timely, complete and relevant.

Harmonization and donor coordination issues can be challenging with a multi-donor operation l i ke the NNP.

There i s always a risk that despite government efforts to get vitamin and mineral supplements

M/L

M h 4

L/L

M/L

large percentage o f the salt will l ikely be iodized anyway (because o f the production by the large producers). The strong commitment and involvement o f the Minister and State Minister for Health wi l l minimize this risk. Stewardship o f the NNP and o f nutrit ion activities in the country has been explicitly given to the F M O H and in general the health sector. This i s in the approved N N S and has been widely publicized. Allocation o f tasks among the key intra-sectoral agencies has been done in an explicit and clear manner, and these agencies are accountable to the Minister and State Minister, and the latter has been very involved in the process, playing a strong supervisory and coordination role.

A good monitoring and reporting mechanism i s being designed, including co l lect ionhe o f appropriate baseline, midterm and endline data. Capacity to carry out M&E will be strengthened through training and mentoring, e.g. o f EHNRI which will bear overall responsibility for M&E o f the NNP and project. Indicators o f the proposed operation are aligned with the broader PASDEP indicators where applicable. The proposed IDA project i s self- contained and does not depend on donor coordination issues, but the success o f the NNP overall i s dependent on donor harmonization and coordination. Discussions have taken place regularly at various fora related to the NNP, and the State Minister o f Health has been very proactive in coordinating overall donor participation and response for activities related to the NNP including the IDA project. These discussions will continue regularly, and have proven to be a key element for resolving various coordination issues. Other elements that will support harmonization are jo in t reviews and consolidated reporting, among others. Studies in Ethiopia show that compliance to irodfolate regimen i s higher than in surrounding countries. The often-made claim o f bad side effects was rarely reported by pregnant women. Even when side effects have

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Social and environmental safeguards

supplements for pregnant women. The project has a C rating because no environmental or adverse social impacts will arise f rom project activities.

(including Reputational Risks)

L/L

M/M 111. Overall R i s k

Safeguard colleagues are in the wider team and will be constantly involved.

stopped women, simple education on how to mitigate these effects by health workers can solve the problem. Health Extension Workers have been educated on this topic.

I I

H = High; S = Substantial; M= Moderate; L = Low

F. Grant Conditions and Covenants

Board Presentation. None

Conditions of Effectiveness

Retention or assignment o f a financial management specialist for the Federal Ministry o f Health to support project financial activities, with qualifications, experience and terms o f reference satisfactory to IDA. Adoption o f a Program Implementation Manual (including the Project financial management manual and Project chart o f accounts to report on Project activities, samples o f the formats for the interim financial reports, and terms o f reference for annual audits o f the Recipient’s Financial Statements, as wel l as the Project procurement manual) a l l in form and substance satisfactory to IDA. Retention or assignment for the project o f two procurement specialists, one each at PFSA and EHNRI, with qualifications and experience satisfactory to IDA.

Legal Covenants

Financial covenants are the standard ones as stated in the Financing Agreement Schedule 2, Section I1 (B) o n Financial Management, Financial Reports and Audits and Section 4.09 o f the General Conditions.

Dated Covenants

Establish, by July 7, 2009, the National Nutrit ion Coordinating Body; Retain or recruit, by October 7, 2008, an external auditor for the Project, in accordance with terms o f reference satisfactory to IDA; Furnish to IDA by July 7, 2010, evidence satisfactory to IDA, demonstrating that universal salt iodization (USI) regulations contemplated to be adopted and put in force for the proper

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implementation o f Proclamation No . 200/200011, have been adopted and are effectively in force in the country; Complete the process for the official registration o f zinc as an essential drug with the Drug Administration and Control Authority, by July 7,20 10; Joint reviews conducted, in conjunction with IDA and other NNP partners, not later than March o f each year, to review al l matters relating to the progress o f the project and NNP.

IV. APPRAISAL SUMMARY

A. Economic and Financial Analyses

54. The project incorporates interventions that have substantially high benefits relative to costs. A benefit-cost analysis was recently undertaken for several interventions affecting nutritional outcomes in Ethiopia as part o f an ESW done by the Wor ld Bank.” The analysis computed three types o f benefits: (i) the benefit f rom reducing child and maternal mortality, measured as the value o f a l i f e saved, or o f a death averted (assumed to be equal to the discounted value in the child’s lifetime earnings); (ii) the benefit f rom increasing economic productivity; and (iii) the benefit f rom enhancing child ability. In each case, a benefit-cost ratio (BCR) was computed. The total B C R i s equal to the sum o f the BCRs from reducing chi ld and maternal mortality, increasing economic productivity, and enhancing chi ld ability.

55. The benefit f rom increasing economic productivity comes from the fact that many o f the analyzed interventions address the detrimental effects that come entirely or partly through stunting and L o w Birth Weight (LBW). These two outcomes result in significant economic losses throughout l i fe, leading in turn to reduced economic productivity.

56. The benefits f rom increased mental ability can be seen in particular with some micronutrients. The effects o f some micronutrients on the mental ability o f a chi ld can be quite dramatic. Iodine deficiency, for example, leads to the I Q o f a child being reduced by 10 to 15 points.

57. The analysis covers most o f the service delivery interventions in the NNP, and each one i s shown to have benefits that are several times or more o f the cost. Although the analysis did not provide BCRs for preventative Community-Based Nutrit ion (CBN) due to lack o f data on this new program, figures are provided for several interventions that are currently a part o f existing community volunteer programs. These also have high BCRs. Promotion o f optimal breastfeeding and o f handwashing, analyzed as part o f the ongoing community volunteer program o f Essential Health Services for Health in Ethiopia, were found to have benefits that are several times the costs. These interventions will also be a part o f the C B N activities supported by the project.

B. Technical

58. Past experience with nutrition programs, especially those implemented at a national level, provide substantial guidance and lessons in terms o f technical design vis-a-vis service delivery as wel l as institutional strengthening. Both have shown to be vital to ensuring a maximum impact on

The relevant section o f this Proclamation says that “any person that produces or distributes salt for II

human consumption shall ensure that i t meets the standard requirement o f iodine content”. l2 See “Malnutrit ion in Ethiopia: Current Interventions, Successes, Cost-Benefit Analysis, and the W a y Forward”. Draft Report, Wor ld Bank. December 2007.

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outcomes. Experience with localized programs on the ground in Ethiopia have also provided a basis f rom which to learn, both in terms o f what should be stressed and what should be avoided.

59. In order to draw the most f rom this body o f experience, the wider preparation team for the NNP and the IDA project involved persons with a broad range o f international as wel l as local experience. A project preparation team was formed and staffed by local experts with technical assistance from well-known international experts with diverse experience in nutrit ion programs in other countries. Many o f the same people wi l l continue to provide guidance and technical assistance even in the implementation stages.

C. Fiduciary

60. Procurement. Public sector procurement in Ethiopia follows the federal structure o f the government. Procurement at federal level i s governed by proclamation no. 430/2005, Determination procedures o f public procurement and establishing i t s supervisory agency proclamation o f the Federal Democratic Republic o f Ethiopia dated January 12, 2005 and the Federal Public Procurement Directive o f July 2005. The proclamation has been reviewed by the Wor ld Bank and found to be satisfactory. Procurements at regional and woreda level are governed by their respective regional code. Subsequent to the Federal Government enactment o f the code, Addis Ababa and Di re Dawa City Administrations and all the regions except Harari and Afar enacted their respective codes based on the model law prepared by the Federal Public Procurement Agency. Harari and Afar regional states are expected to prepare and ratify their respective codes shortly.

61. Procurement for the proposed project wi l l be carried out in accordance with the Wor ld Bank's "Guidelines: Procurement Under IBRD Loans and IDA Credits" dated M a y 2004 Revised October 2006, and "Guidelines: Selection and Employment o f Consultants by Wor ld Bank Borrowers" dated M a y 2004 Revised October 2006, and the provisions stipulated in the Financing Agreement. For each contract to be financed by the Grant, the different procurement methods or consultant selection methods, estimated costs, prior review requirements, the time frame and the corresponding implementing agency would be agreed between the FMOH/EHNRI and the Bank project team in the Procurement plan. T h e agreed procurement plan for the first 18 months i s attached in the Project Appraisal Document (PAD) and i s available at FMOH, EHNRI and Image Bank. The procurement plan wil l be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

62. The procurement procedure applicable to the project shall be outlined in the Project Procurement Manual (PPM). The Bank's Standard Bidding Documents (SBD) shall be used for a l l International Competitive Bidding (ICB) procurements. The Bank's Standard Request for proposals shall be used for al l selection o f consultants estimated to cost more than US$200,000. The SBDs issued by the Federal Government, revised as per the comments provided and found acceptable by the Bank, may be used for the procurement o f Goods and Works using the National Competitive Bidding method (NCB). The SBDs that are acceptable to the Bank (for N C B bids) would be provided to implementing agencies with the PPM.

63. The overall project risk for procurement i s high. The r isks identified during procurement capacity assessment, the risk mitigation measures, the responsible body and the time frame are agreed between the Federal implementing agency and the Bank's task team, and are part o f the procurement annex - Annex 8.

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64. Financial Management. The country’s discipline in executing budget and compliance with the existing government rules and regulations are the major strengths in implementing this project. FMOH, ENHRI, RHBs and woreda finance offices will be involved in processing most o f the project financial transactions. All o f the implementing agencies will strictly follow the government rules and regulations in processing, recording and reporting the project financial transactions.

65. The government system o f accounting will be used for budgeting, recording, reporting and auditing o f the project’s financial transactions. The major r i sks for the implementation o f the project are the high number o f implementing agencies involved in the implementation and the l o w capacity at a l l levels. In order to mitigate these risks, additional staff will be recruited at FMOH to strengthen the existing capacity and extensive training will be provided to al l regional and woreda staff.

66. A Designated Account will be opened in the National Bank o f Ethiopia to transfer funds f rom the Grant Account. From the Designated Account funds may be transferred to the local ETB accounts and f rom the local ETB account to various implementing agencies.

67. On the basis o f financial reports received from the relevant implementing agencies at the federal, regional and woreda levels, FMOH will submit a consolidated Interim Financial Report to IDA within 45 days after the end o f each quarter

68. conduct the audit o f the project financial transactions.

The Federal Auditor General will assign external auditors, acceptable to the Bank, to

69. The overall conclusion from the financial management assessment i s that the existing government system could be used for the implementation o f the project and al l the required financial management staff (or equivalent) should be recruited at the FMOH. . Furthermore, the required training should be provided by FMOH to a l l staff o f the implementing agencies on recording and reporting o f the financial transactions o f the project. A detailed financial management assessment i s given in Annex 7.

D. Social

70. The project and the NNP recognize the considerable importance o f social and cultural beliefs and practices that influence maternal and chi ld care, and eventually nutrition and health outcomes. Particular attention i s being and wil l be paid to these issues in the design and implementation o f the Community-Based Nutrit ion activities (Component 1) as wel l as the Advocacy, Social Mobil ization and Program Communication activities (Component 2) o f the project, which deal with BCC. Culture-sensitive information and communication strategies will be developed and used for these B C C activities. The culture-sensitive information will include beliefs surrounding breastfeeding behavior and i t s implications for nutritional outcomes. The adoption o f simple implementation strategies wi l l encourage participation and inclusiveness and create ownership and sustainability through behavioral change. I t i s also essential to take into account cultural and social beliefs in the promotion o f improved diets.

E. Environmental

7 1. category i s “C”.

There are n o potential negative impacts f rom this project and therefore the environmental

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F. Safeguard Policies

SafePuard Policies Tr iggered by the Proiect Yes N o X Environmental Assessment (OP/BP/GP 4.0 1)

Natural Habitats (OPBP 4.04) X Pest Management (OP 4.09) X Cultural Property (OPN 1 1.03, being revised as OP 4.11) Involuntary Resettlement (OPBP 4.12) X Indigenous Peoples (OD 4.20, being revised as OP 4.10) Forests (OPBP 4.36) X Safety o f Dams (OPBP 4.37) Projects in Disputed Areas (OP/BP/GP 7.60) Projects o n International Waterways (OPBP/GP 7.50)

X

X

X X X

G. Policy Exceptions and Readiness

Policy Exceptions.

72. N o policy exceptions are being sought.

Readiness.

73. The government has put together a preparation team for the NNP and the IDA project. The team has worked wel l with the help o f technical assistance from international consultants and with the strong support and also participation o f the State Minister for Health. A detailed draft Program Implementation Manual (PIM) has been prepared and was presented at a workshop involving stakeholders from various government and donor agencies, and inputs from participants were factored into the PIM. The P I M also includes details on fiduciary arrangements for the proposed IDA project. The PIM has been appraised and found to be satisfactory. To ensure a smooth start to implementation, at least two members o f the program preparation team will stay o n wel l into the implementation phase. Critical activities related to implementation will take place starting immediately f rom the time o f project approval, before project effectiveness, including hiring o f Financial Management and Procurement specialists as specified in Annexes 7 and 8 and development o f Terms o f Reference and bidding documents for activities to be conducted upfront (see the Procurement Plan).

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Annex 1: Country and Sector or Program Background Ethiopia: Nutrit ion Project

I. County Background

Ethiopia has experienced recurrent shocks including droughts, floods and unrest, which cause starvation and destitution. Despite a recent high rate o f economic growth (averaging 11 -8% annually in the period o f 2004-07) and i t s abundance o f natural resources, poverty i s s t i l l widespread, with 39% o f the population estimated to live below the poverty l ine in 2004/0513. Due to i t s relatively poor human development and economic indicators, Ethiopia i s ranked 169 out o f 177 countries on the United Nations Development Programme’s Human Development Index.

Currently, Ethiopia has a population o f 80 mill ion. The population growth rate i s high and i t i s estimated to increase to 93.8 mil l ion by 2015. Almost 85% o f Ethiopians l ive in rural areas, with the majority relying on rain-fed agriculture and livestock rearing for their livelihoods. Ethiopia’s varied climate and diverse agro-ecological zones provide the country with a variety o f agricultural products. Although Ethiopia should be able to produce enough food for i t s e l f and even for export, i t imports food to feed i t s people.

In 1994, the new Ethiopian constitution introduced a federal government structure. The federal structure i s composed o f nine regional states and two city administrations. Each region i s divided into zones, then woredas, then kebeles or peasant associations. There are 80 zones, 710 woredas, and about 15,000 kebeles (5,000 in urban and 10,000 in rural areas) respectively. The country has instituted a vigorous process o f decentralization to lower levels; decentralization to the woreda level began in 2002. Delivery o f basic services i s now largely carried out at a decentralized level, with the regions and woredas playing principal roles in this regard.

II. Sector Background

Policy Background

Administrative Structure and Policy Development: The Government o f Ethiopia’s (GOE) health policy puts strong emphasis on supporting poor and vulnerable people, especially in rural areas. Accordingly, health sector development i s designed and implemented in line with the country’s decentralization policy.

Decision making on the development and implementation o f the health policy i s shared among the Federal Ministry o f Health (FMOH), the Regional Health Bureaus (RHBs) and the Woreda Health Offices (WOHOs). Whi le the FMOH and the RHBs are responsible for policy management and technical support, the WOHOs play vital roles on managing and coordinating the operation o f the health care services at the woreda and below.

Third Health Sector Development Programme (HSDP-III) and Health Extension Program (HEP): The GOE recently introduced HSDP-111, covering the period 2005 to June 2010. An integral part o f the HSDP-I11 i s the innovative Health Extension Program (HEP). The objectives o f the HEP are as follows: (i) improve practices related to proper hygiene; (ii) improve reproductive health and nutritional status; (iii) control common infections; and (iv) bring equity in health services. The HEP gives priority to the prevention and control o f communicable diseases

According to the Plan for Accelerated and Sustained Development to End Poverty, 2006. 13

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through promoting active community participation. In order to provide health care services efficiently, the program i s expanding physical health infrastructure by building one Health Post in each kebele.

The HEP i s placing two government-salaried female Health Extension Workers (HEWs) who wil l provide preventative and promotive as wel l as some basic curative health care services, and also education on various health topics, in every community. T o support the HEWs in their work, Volunteer Community Health Promoters (VCHPs) will be trained and work in the kebeles. HEWs are given extensive training in 16 health focus areas as wel l as personal development training. By December 2007, 24,600 HEWs had been trained and deployed. I t i s planned that al l 30,000 HEWs will be trained by 2009.

Nutrit ion i s recognized by the government as being multi-sectoral (see below); the HEP incorporates the nutrition interventions that are relevant to the health sector.

National Nutrition Strategy (NiVS): GOE developed a N N S during 2005/2006 based on a thorough assessment o f the country’s problems and issues. The N N S has been officially approved and launched at a high-level ceremony on February 7, 2008. Although nutrition i s recognized in the N N S as being multi-sectoral, overall responsibility for i t has been given to FMOH.

In September 2006, the GOE adopted i t s second five-year Plan for Accelerated and Sustained Development to End Poverty (PASDEP) covering 2005-2010. The PASDEP explicitly calls for the implementation o f the N N S to help achieve the MDG for halving poverty and hunger by 2015.

National Nutrition Program (NNP): The NNP i s being formulated in order to implement the N N S . The FMOH i s taking the lead in this process, but other ministries and sectors are also participating in view o f the multi-sectoral nature o f the problem as recognized by the N N S . The NNP i s a long-term program, with the f i r s t phase spanning the five years f rom July 2008 to June 2013.

Status and Trends of Health, Nutrition and Related Indicators

Health Indicators: Several key indicators show that Ethiopia i s facing severe health and nutrition problems, despite signs recently o f progress in some areas. According to the 2005 Demographic and Health Survey (DHS), the maternal mortality ratio i s considerably high at 673 per 100,000 l ive births. Infant and under-5 mortality ratios are 77/1,000 and 123/1,000 respectively. Incidence o f l o w birth weight (LBW) i s also high, with 14% o f babies weighing less than 2.5 kg at birth. One major contributing factor to LBW i s a poor nutritional status o f woman both before and during pregnancy.

Malnutrit ion i s a contributing factor to more than hal f o f a l l chi ld deaths. Nine out o f ten child deaths in Ethiopia are attributable to only five conditions: pneumonia, malaria, diarrhea, neonatal problems and measles.

Trends in Stunting, Wasting and Underweight: In recent years, there have been improvements in some o f the standard malnutrition indicators. According to the successive Welfare Monitoring Surveys (WMS), while wasting remained unchanged, stunting and underweight prevalence among children under 5 have improved significantly over the last ten years (Table Annex Al-1).

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Table Al-1: Prevalence of Wasting, Stunting, and Underweight by Gender, Place of Residence and over Time

National Level 1996 1998 2000 2004 Rural 1996 1998 2000 2004 Urban 1996 1998 2000 2004

Wasting Stunting Underweight

Source: Central Statistical Agency (2004).

Despite these encouraging improvements, Ethiopia s t i l l has one o f the highest chi ld malnutrition rates in the world. Almost ha l f o f all Ethiopian children remain stunted. Although stunting rates have fallen substantially, they remain very high by developing country as wel l as regional standards. Stagnation in wasting rates for urban children in particular i s also o f concern.

Table A1-2 shows traditional nutrition and health indicators for various countries and regions. The neonatal mortality rate (NMR) and stunting rate are substantially higher in Ethiopia compared to i t s neighbors and other developing countries. Wasting, o n the other hand, i s below the levels o f Somalia, Sudan and Eritrea, but above levels in Sub-Saharan Afr ica (SSA) and developing nations as a whole. The under-5 mortality rate (U5MR) and infant mortality rate (IMR) are higher than al l neighbors aside form Somalia and on par for SSA.

Source: CSA & ORC Macro (2006).

Micronutrient Deficiencies: Micronutrient deficiencies are some o f the most prevalent disorders in Ethiopia. Iodine Deficiency Disorders (IDD), Vitamin A Deficiency (VAD), and I ron Deficiency Anemia (IA) affl ict a high proportion o f the population and cause bil l ions o f ETB in lost earnings to the poorest households. Due to i ron deficiency, iodine deficiency disorders, and

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stunting alone, Ethiopia will lose an estimated 144 b i l l ion ETB between 2006 and 2015 or an estimated 10% o f GDP.14 Table A1-3 shows some o f the indicators used to evaluate Ethiopia’s progress as wel l as providing a nutritional snapshot o f i t s current situation comparing rural and urban populations. This data was collected as part o f the 2005 DHS.

Indicator Urban Adequately iodized salt in the home 21%

Rural 19.7%

Y

Ate vitamin A-r ich foods in the previous 24 hours Ate I ron r i ch foods in the previous 24 hours

44.2% 24.5% 28.7% 9.9%

Women with children aged <3 years who: Ate vitamin A-r ich foods in the previous 24 hours Ate I ron r i ch foods in the Drevious 24 hours

IDD i s a particularly serious problem in Ethiopia. IDD decreases mental abilities permanently, resulting in an estimated IQ loss o f 10 to 15 points. Yet the prevalence o f adequately iodized household salt i s very l o w in Ethiopia, as seen from Table A1-3. About 685,000 babies born annually in Ethiopia - over one for every five births - are estimated to suffer f rom a certain degree o f mental retardation due to IDD in their mothers.

54.4% I 31.5% 3 1.5% I 12.8%

Suboptimal Breastfeeding Practices: BF i s nearly universal in Ethiopia, with 96 percent o f children being breastfed at some point. However, a very large proportion o f women do not practice appropriate BF and complementary feeding (CF) behavior. About a third o f babies do not receive BF within one hour o f birth, and only one in three children aged 4-5 months i s exclusively breastfed. There are also an increased number o f children, aged 6 to 9 months who are not breastfed at all.

Women who reported night-blindness in previous pregnancyI5

Women with Anemia Children aged 6-59 months with Anemia

About 50,000 infant deaths or 18% o f all infant deaths a year are estimated to be caused by poor BF habits in Ethiopia. M u c h o f the inappropriate BF behavior i s due to lack o f knowledge, rather than practical or financial constraints in practicing such behaviors. This i s supported by the fact that there i s n o evidence o f a positive relationship between wealth and optimal BF behavior.16 Therefore, education and introduction o f appropriate BF and CF practices i s key to chi ld survival.

3.1% 6.4% 46.8% 54% 17.8% 28.2%

Links between Food Security Status and Malnutrition

As i s commonly believed, food security, which i s the availability, access, and utilization o f sufficient food by a l l people at a l l times, affects the nutritional status o f a population. However, Ethiopia’s high malnutrition rates are attributed to a range o f other non-food factors, including appropriate breastfeeding; other feeding and child care practices; hygiene; health status and health interventions; immunizations; the perceived status o f women in society; and adequate water supply and sanitation.

l4 See Ethiopian PROFILES. Sign o f Vitamin A deficiency.

l6 See CSA & ORC Macro (2006).

15

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Data from the 2004 W M S show a clear and strong positive relationship between the wasting rates among under-5 children - both moderate and severe - and the self-reported number o f months o f food shortage experienced by a household within the previous 12 months (see Table A1-4). This shows the importance o f providing food through properly targeted programs as one vital category o f interventions against wasting. But wasting rates are s t i l l very high among children from households who experienced n o food shortage within the previous 12 months, underlying the vital importance o f interventions that do not provide food. Note that the data on stunting rates, as shown in the table, show l i t t l e correlation between stunting rates and food shortage within the previous 12 months, but the relationship between food shortage and stunting (a more long-term phenomenon) i s more complex than between food shortage and wasting (a more short-term phenomenon).

Number o f

Children in

Sample

Table A1-4: Malnutrition Rates in 2004 Among Under-5 Children From Households with

Stunting Rate in 2004

Moderate and Severe

Severe Only Among Under-5 Children From Households That Experienced N o Food Shortage In Previous 12 Months Among Under-5 Children From Households That Experienced 1 to 3 Months o f Food Shortage In Previous 12 Months Among Under-5 Children From Households That Experienced 4 to 6 Months o f Food Shortage In

Households That Experienced 7 to 12 Months o f Food Shortage In Previous 12 Months

826

311 Source: Calculations using data fkom

54.2% 28.8%

46.3% 22.0%

1.634

Wasting 20

Moderate and

Severe

7.7%

9.4%

12.0%

15.5%

tate in 4

Severe Only

1.4%

2.3%

2.0%

3.7%

Need for a Strengthened Nutrition Information/Suweillance System

In Ethiopia, i t i s not currently possible to obtain localized information on nutritional indicators at the kebele or even the woreda levels, except on a sporadic basis. Virtually the only woreda-level data that are available come from localized nutrition surveys conducted in woredas in emergency situations as part o f the system overseen by the Emergency Nutr i t ion Coordination Unit (ENCU), described below. Surveys with broad geographical coverage such as the W M S and the D H S are conducted, but only once every three years, and these are only representative at the zonal level (for the WMS) or the regional level (for the DHS). This means that these surveys cannot be used to provide accurate values for nutritional indicators for individual woredas. Furthermore, they do not cover al l areas o f the country; for example, the D H S does not cover nomadic areas.

Ethiopia currently does have the Early Warning System (EWS) o f the DPPA, but this i s focused more on collecting indicators o n food insecurity than on nutritional insecurity. A basic premise o f

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the NNP i s that addressing food insecurity i s not the same as addressing nutritional insecurity, since the two are only partly related. Furthermore, i t does not track such nutritional indicators as stunting, wasting and goiter rates. Also, the EWS data collection efforts are relatively weak in pastoral areas, non-famine prone areas, areas o f non-sedentary populations and areas where people have been historically marginalized. The EWS also excludes urban areas. There are also routine data reported regularly through the Health Management Information System (HMIS), but these provide data at present only on selected indicators relevant to nutrit ion (e.g. percentage o f children who are underweight and clinical cases o f severe malnutrition) and currently only at the facility level.

The E N C U directs NGOs to conduct rapid assessment and nutrition surveys in woredas where an emergency situation appears to be developing, as determined by the EWS. I t collects and records the data f rom these surveys, but these are the only nutrition data that i t collects. These data are l imi ted to the woredas where a potential emergency situation i s occurring f rom a food security viewpoint, and does not focus o n other woredas where there could be chronic food security, or where there could be nutritional insecurity with poor nutritional indicators even without food insecurity. The E N C U also cannot be used for the purposes o f monitoring and evaluation, since it does not collect data f rom an unbiased sample o f woredas. In addition, i t cannot be used for the purposes o f program targeting or o f the selection o f woredas for individual programs, because o f i t s l imited coverage o f woredas.

Because o f a l l this, reviews o f Ethiopia’s nutrition strategy, programs and situation consistently end in recommendations to establish a proper comprehensive nutrition informatiodsurveillance ( N U S ) system. This i s a key recommendation o f the N N S . Such a system would be able to track localized nutritional indicators at a large number o f focal points, so that the nutritional status o f households in different localities could be tracked over time, at the woreda and even the kebele levels. An NUS system can identify constraints in particular areas, help determine if project objectives are being met, provide information to improve targeting, assess quantity, quality and timeliness o f project inputs and inform decision making at each level o f government.

Need to Improve Linkages and Targeting of Programs Affecting Nutrition, and the Importance in this Regard of a Good Nutritional I n formation/Suvveillance (NI/S) System

There are already a number o f different programs in different sectors in Ethiopia that affect nutrition. But targeting and coordination among programs could clearly be improved. Programs tend to use geographical targeting procedures (among others) to select the woredas (districts) o f focus, which in principle i s correct. However, in large part because o f a lack o f adequate information and a lack o f tracking o f localized nutrition-related indicators (i.e. because o f a lack o f a properly functioning NUS system), i t i s diff icult to properly implement geographical targeting. More generally, the lack o f proper NUS makes it diff icult to implement targeting using any type o f targeting procedure and also makes it diff icult to engage in proper program design.

M a p Al-1 depicts the tendency o f the major programs affecting nutrition - food aid i s not included as a “program” here - to focus on certain preferred woredas. The map also shows that there i s a high degree o f overlap between the woredas where the major food-providing programs occur and the woredas that regularly receive food aid.

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Map Al-1: Concentration of Major Programs' Affecting Nutrition and Location o f Woredas Regularly Receiving Food Aid, 2006

1. The programs included in themap are: EOS, TSF, PSNP, MERET, School Feeding, ESHE, the CGP component o f FSP and Pathfinder.

Maps A1-2 and A1-3 reflect the prevalence o f stunting and wasting in different parts o f the country according to data f rom the WMS collected in 2004, when several o f the major programs affecting nutrition had not yet begun. The three maps together show that there are large parts o f the country - the west o f the country for example - that have high malnutrition rates but a l o w concentration o f programs affecting nutrition. The overall picture i s one where targeting o f programs could be clearly improved.

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M a p Al-2: Stunting Prevalence in 2004

Map A1-3. Wasting Prevalence in 2004

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Annex 2: M a j o r Related Projects Financed by the Bank and/or other Agencies Ethiopia: Nutr i t ion Project

s1. N o Pro jec t ID Name Objective DO IPratings

ratings Bank Financed

1. PO74015 Protection o f Protect and promote the delivery o f basic S S Basic Services services by sub-national governments while Project deepening transparency and local

accountability in service delivery

2. P106559 Additional Protect and promote the delivery o f basic NA NA Financing - Protection o f Basic Services Project

services by sub-national governments while deepening transparency and local accountability in service delivery

3. PO50383 Food Security Build the resource base o f poorer rural Project households, increase their employment and

incomes, reduce their real costs o f food, and improve nutrit ion levels for their children under five years o f age, and pregnant and lactating mothers

S S

4. PO69886 Multi-Sectoral Help accelerate implementation o f the Federal S S HIV/AIDS Project and Regional Multi-Sectoral H N / A I D S

Strategic Plans, particularly through the provision o f H IV /A IDS prevention, care and treatment services at a l l levels and in a number o f sectors

5. PO9803 1 Second Multi- Increase access to prevention services for Sectoral H IV /A IDS Project

youth, in particular females aged 15-24, and other most-at-risk groups and sustain access to care and support for P L W with H IV /A IDS and orphans undertaken in EMSAP I

6. PO74020 Public Sector Improve the scale, efficiency, and Capacity Building Program Support Project

responsiveness o f public service delivery at the federal, regional, and local level; to empower citizens to participate more effectively in shaping their own development; and to promote good governance and accountability

S S

S S

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7. PO87707 Productive Safety N e t Project

8. PO98093 Productive Safety Net Program APL I1

9. PO76735 Water Supply and Sanitation Project

10. P101473 Urban Water Supply and Sanitation Project

Assist the Government to shift fkom a relief- oriented to a productive and development- oriented safety net by (i) providing predictable, multi-annual resources, (ii) replacing food with grants as the primary medium o f support, and (iii) making resources available for critical capital, technical assistance, and administrative costs

Improve the efficiency, effectiveness and fairness o f the program in terms o f ensuring: (i) timely, well-targeted transfers, (ii) the quality and environmental impact o f the public works, (iii) the complementarity between the PSNP and other food security interventions, (iv) the local accountability dimensions o f the program, and (v) Ethiopia’s ability to respond to drought

Increase access to sustainable water supply and sanitation services, for rural and urban users, through improved capacity o f stakeholders in the sector

S S

S S

S S

Increase access to sustainable water supply S S and sanitation services in Addis Ababa and four secondary cities

S=Satisfactory U=Unsatisfactory

M a j o r ongoing projects o f other development agencies

1.

2.

3. 4.

5. 6.

7 8. 9.

Food Security Project

Second Multi-Sectoral H IV /A IDS Project

Productive Safety Ne t Program APL I1 Public Sector Capacity Building Program Support Project Water Supply and Sanitation Project Enhanced Outreach Strategy for Child Survival Community based nutrition project School Feeding Program Essential Nutrit ion Actions

Financed by CIDA, DFID and Italian Development Cooperation Financed by PEPFAR, Global Fund and Italian Development Cooperation Financed by CIDA, DCI, DFID, EC, WFP and U S A I D Financed by CIDA, SIDA and other donors

Financed by DFID Financed by UNICEF and WFP

Financed by UNICEF Financed by WFP Financed by U S A I D

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Annex 3: Results F r a m e w o r k and M o n i t o r i n g Ethiopia: Nutrition Pro jec t

1

Higher Level Objectives

status o f vulnerable groups, especially young children and pregnant women

T o improve ch i ld and maternal care behavior, and increase uti l ization o f key micronutrients, in order to contribute to improving the nutrit ional status o f

T o enhance delivery o f key nutr i t ion services, in terms o f quantity and quality, through community-based nutrit ion interventions and supply o f key micronutrients

- Percentage o f operational research studies contracted out o f a target o f 10 to be achieved by project completion

capacity to deliver improved nutrit ional

- Percentage o f under-5 children with weight-for-age less than two standard deviations below the median o f the reference population (MDG- 1 indicator)

- Percentage o f under-5 children with height-for-age less than two standard deviations below the median o f the reference oooulation

me In r s

- Percentage o f infants aged 0-5 months exclusively breast fed2

- Percentage o f households using adequately iodized salt3

- Percentage o f pregnant women receiving i ron and folate supplementation2

curriculum4: percentage out o f a target o f 30,000 to be achieved by project completion

- Universal Salt Iodization pol icy adopted and put in force, supporting Proclamation 200120005;

- Zinc registered as an essential drug and included in the Health Post package;

- Percentage o f iodization machines functioning out

- Establishment o f inter-sectoral National Nutr i t ion Coordination Body with high-level membership f r o m different nutrition-related sectors

- Percentage o f households receiving nutr i t ion information in past year that indicate a radio program discussion or community conversation as a source o f information

- Percentage o f nutrit ional surveillance sites operating and providing periodic data out o f a target o f 20 to be achieved by project completion

us Obje n

T o monitor trends in key indicators which the project expects to impact significantly

T o monitor progress towards improving chi ld and maternal care behavior related to nutrit ional outcomes and towards increasing uti l ization o f key micronutrients

itoring

To monitor progress towards strengthening service delivery through community based nutrit ion and micronutrient interventions

To monitor progress towards strengthening institutional capacity with the a im o f delivering improved nutrit ional services

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s E: 8

s E: 8

I

0 m

I

z 2 4

x x 2 z 3 z s. g 0 2 2

s. 0 2 g 0

g g N VI

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I

Annex 4: Detailed Project Description Ethiopia: Nutrit ion Project

The proposed IDA project will fund critical activities in support o f the multi-partner National Nutrit ion Program (NNP). I t wil l have two components: Supporting Service Delivery (Component 1) and Institutional Strengthening and Capacity Building (Component 2). The project will provide $14 mi l l ion and $16 mi l l ion to these two components, respectively.

Component 1: Supporting Service Delivery ($14 million from IDA, and $5.3 million from GOE)

Component 1 o f the proposed IDA project will support two areas: Community-Based Nutrition (CBN) and Micronutrient Interventions. The focus o f the CBN activities supported by the project will be on Health Extension Workers (HEWs) and supervisors o f HEWs. The government i s ro l l ing out a program nationwide whereby 30,000 HEWS wil l be deployed - two in every kebele (community) - by the end o f 2009. By December 2007, 24,600 HEWS had already been deployed. The government will soon introduce a program whereby supervisors o f HEWS wil l be deployed at health centers, totaling 3,200 by year 2009.

Providing C B N services i s a part o f the function o f the HEWs, which will be supported by HEW supervisors, in accordance with the government’s flagship Health Extension Program (HEP). The project will strengthen and support this role, especially by supporting relevant training activities and materials. The focus will be to provide CBN services through outreach to the community and the use o f model households identified in the community as an integral part o f the HEP. C B N wil l expand geographically in a manner consistent with HEP expansion.

The C B N activities will a im at: (i) building community capacity for assessment, analysis and action specific to preventing chi ld malnutrition (Triple-A approach - Assess, Analyze and Action - involving sensitization efforts at woreda, kebele and gotte levels, followed by community mapping, community based action and participatory assessments o f progress); (ii) promoting improved caring practices for children and women to prevent malnutrition; (iii) improving referral linkages to relevant chi ld health and nutrition services and other linkages for addressing non-health causes o f child malnutrition; (iv) developing and implementing a strong advocacy and communicatiodmobilization strategy to support a l l CBN activities; and (v) enhancing capacity for C B N implementation at regional and woreda levels.

The specific activities include improvement o f caring practices for maternal and child care through: (i) Essential Nutrit ion Actions (ENA) and Chi ld Growth Promotion (including promoting ENA for children and pregnant and lactating women through interpersonal and group communication, promoting other relevant chi ld care practices by incorporating available Behavioral Change Communication (BCC) materials, promoting adequate growth o f every chi ld under two years o f age, establishing quarterly Child Health Days and maintaining the coverage and quality achieved through EOS, and building a capacity o f reporting and feedback to support effective follow-up actions); and (ii) maternal care (including promoting maternal care through interpersonal and group communications, establishing pregnancy weight gain monitoring activities, providing outreach services for pregnant and lactating women by HEWs, including i ron and folate supplementation - complementing existing HEW/HEP efforts - and deworming); and (iii) adolescent care (including promoting adolescent nutrition and care through interpersonal and group communications).

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Under the supervision o f the HEW supervisors and the WOHOs, HEWs will be in charge o f weighing children and providing appropriate counseling at the outreach sites. Considering the work burden o f the HEW and the manageable number o f children to be weighed at one outreach, there wi l l be one outreach per month for every 125 target households (30 under-2 children per outreach). With regard to data utilization and reporting, the HEW will collect the weight data f rom the outreach register and report to the H M I S . The bulk o f the data will be used at the community level for Triple A and “community conversation” activities. “Community conversations” aim at creating supportive environments at family and community levels through community dialogues and collective actions. In “community conversation” sessions, community members analyze causes o f nutrition problems in the local context using localized data (e.g. f rom the child weighing sessions) and discuss how they can take action at the family and community level by creating supportive environments for child care.

For C B N costing purposes, the cost o f goods, materials and orientation workshops are included under Component 1. The costs related to training and development o f HEWs and HEW supervisors are included in Component 2. In practice, a l l these activities are complementary and are al l essential in order to achieve the desired outcomes.

Component 1 wil l also support selected Micronutrient Interventions, focusing on critical activities to enhance the appropriate utilization o f key micronutrients especially iodine, iron, Vitamin A and zinc. (The description here does not cover operational research on micronutrients, nor communication activities to cause appropriate dietary modifications, both o f which are covered by Component 2 o f the IDA project as described below.)

In order to ensure appropriate levels o f utilization o f iodine especially among children and pregnant women, a key goal o f the project will be to support the government to achieve Universal Salt Iodization (USI). Regulation and procedures to prohibit the production or distribution o f salt that i s not iodized, or inadequately iodized, will be enacted and enforced. The appropriate US1 regulatiodprocedures will be officially approved by the end o f the second year o f the project.

Because zinc has not been officially registered as an essential drug, i t cannot be administered by health workers or HEWs for treatment o f diarrhoea. Zinc will be registered as an essential drug by the end o f the second year o f the project so that health workers and HEWs can administer i t for therapeutic purposes, especially in conjunction with the use o f Oral Rehydration Salts (ORS) therapy in cases o f children having diarrhoea. (The optimal regimen for diarrhea treatment i s ORS sachets for two days followed by crushable zinc tablets for 7 to 14 days.)

The project wi l l support relevant operational costs incurred for the delivery o f key micronutrients. It wi l l also support the purchase o f key micronutrients, including purchases at scale o f i ron and folate as wel l as zinc tablets. Health workers and HEWs in Ethiopia are currently authorized to distribute i ron and folate tablets and will also be authorized to give out zinc tablets after the registration o f zinc as an essential drug as mentioned above. The CBN activities will focus, among other things, o n proper compliance regarding utilization o f these tablets.

The above inputs will be complemented by technical assistance as wel l as human resources and institutional strengthening so that the project can achieve i t s goals o f adequate utilization levels as wel l as appropriate utilization patterns for the key micronutrients, especially among children and pregnant women.

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Component 2: Institutional Strengthening and Capacity Building ($16 million from IDA, and $4.3 million from GOE)

Component 2 o f the proposed IDA project will support three areas: (i) Strengthening Human Resources and Capacity Building; (ii) Advocacy, Social Mobilization and Program Communication; (iii) Strengthening Nutrition InformatiodSurveillance (SNI/S), Monitoring and Evaluation (M&E); and Operational Research (OR).

The f i rst area, Strengthening Human Resources and Capacity Building, will cover the following activities:

Coordination Mechanisms for Nutrition at Different Levels

Inter-sectoral coordination mechanisms, addressing both policy and technical aspects, wi l l be supported, as detailed in Annex 6.

Institutional Capacity Building for Implementing Units at Different Levels (Including Human Resources Strengthening)

The Nutrit ion Unit at the Federal Ministry o f Health (FMOH) under the Family Health Department i s new and will need capacity building and expansion to support a multi-sectoral and multi-partner NNP. Other key agencies that will play a key role in implementing the NNP include the Health Extension and Education Center (HEEC), the Ethiopian Health and Nutrit ion Research Institute (EHNRI) and the Nutrit ion Units (or equivalents) o f the regions. These will also be strengthened in line with their additional functions. The strengthening wil l take the form o f human resources strengthening as wel l as logistics support.

Training and Capacity Building of Research and Training Institutions

Component 2 wil l cover capacity building and training o f four categories o f personnel: (i) “frontline” workers (e.g. HEWS and HEW supervisors); (ii) midlevel managers working o n nutrition-related areas (those working at WOHOs and RHBs); (iii) clinical nutritionists; and (iv) higher-level “supernutritionists” (e.g. those working at higher-level institutions). For strengthening the local research capacity, EHNRI has been selected as it i s the leading institution for undertaking health and nutrition research. These training and capacity building activities (including for the “supernutritionists”) will occur in-country, since this will provide the most value added in terms o f in-country capacity building.

The activities to be carried out include:

Strengthening universities and regional health colleges regarding nutrition and HEP-related training (for pre-service and in-service training) Linkages with foreign universities and academics Strengthening nutrition departments and programs at universities and colleges Strengthening EHNRI in terms o f human resources as wel l as by availing necessary support in various areas including purchase o f laboratory equipment and supplies and funding short- term visits and training Training needs assessment, curriculum revision and development, procurement o f educational materials, as wel l as technical assistance with certain sk i l ls

- 34 -

Component 2 will also support Advocacy, Social Mobilization and Program Communication activities with the following overall aims: (i) generate ownership o f the country’s nutrition agenda by government and non-government decision makers, stakeholders and the public at large; (ii) identify the highest priority nutrition messages in need o f dissemination and the constraints and resistance points presently limiting changes in practices; (iii) incorporate these messages systematically into various communications channels including mainstream media, community radio, “community conver~ations”~’ and materials o f the health sector and o f other sectors; and (iv) complement the efforts o f HEWs and VCHPs/model households to promote appropriate caring practices among care providers, communities and service providers through CBN with behavior change messages in various communications media.

Finally, this component wil l support Strengthening Nutrition Information/Surveillance (SNI/S), Monitoring and Evaluation (M&E), and Operational Research (OR). This set o f activities will provide information for M&E activities regarding the project interventions as wel l as, more broadly, many o f the overall NNP interventions. I t will also provide information to support various other programs and enhance understanding o f their impacts on nutrition, including the HEP, EOS and PSNP, as wel l as various food security programs and programs affecting disastedepidemic prevention, preparedness and response. I t wil l work by strengthening existing systems including the HMIS, IDSR and DSS systems. Table A4-1 summarizes the various activity categories, roles and responsibilities for the various SNI/S and M&E activities.

Routine HMIS monitoring data: With the current reformed HMIS, routine data are collected only at health facilities and health posts and are transferred to WOHOs and onwards. These include nutrition-related data such as on growth monitoring and clinical cases o f malnutrition. With the introduction o f C B N (in Component l), HEWs will register weight and age data when they take charge o f monthly outreach weighing sessions, and these data will be channeled through the HMIS. Thus, i t will be possible to monitor selected community-level nutrition-related indicators, rather than having them monitored at the facility level as i s currently done, thereby improving the coverage and representativeness o f the data. Data on clinical cases o f malnutrition will also be collected and may be reported in the same way depending on the diagnostidmanagement capabilities o f the HEWs.

Surveillance sites: Currently, universities” operate four Demographic Surveillance Sites (DSS), where demographic and related data are routinely collected. The current DSS sites do not collect information on nutrition, but under the NNP, FMOH will contract these universities to build on the existing efforts to collect additional data including on relevant nutritional indicators. The number o f sites wi l l also be expanded, with new sites started in different geographical areas, and other universities will also be involved. The surveillance sites wi l l help to validate data collected through the routine H M I S system. They will also generate detailed information which will be very useful for understanding trends in key variables and interactions among them and will also help strengthen program managemenb‘design and early warning responses.

I t i s essential that each surveillance site collect the same data and in exactly the same manner so that i t can be analyzed by EHRNI. I t i s particularly important in Ethiopia that surveillance data be collected in the same seasons in each year. A l i s t o f key indicators to be monitored has been included in the Program Implementation Manual for the project. EHNRI will assume responsibility for assuring that the data collection at each site i s consistent and o f uniformly high

At “community conversation” sessions, community members analyze causes o f nutr i t ion problems in the local context, using localized data (e.g. f r o m chi ld weighing sessions), and discuss h o w they can take action at the family and community level by creating supportive environments for ch i ld caring. ’* Addis Ababa, Gonder, Jimma and Alemaya Universities.

17

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quality and will provide supervision for the init ial rounds o f the expanded data collection. All data will be sent to EHNRI for analysis and rapid reporting to key stakeholders.

National surveys: Various existing surveys with national coverage, each conducted once every few years, provide very useful data for M&E and related purposes. These include: (i) the Demographic and Health Surveys (DHS) implemented by the Central Statistical Agency (CSA) and EHNRI; (ii) the Welfare Monitoring Surveys (WMS) implemented by CSA; and (iii) various micronutrients surveys implemented by EHNRI. In addition, there wil l be a baseline and endline NNP survey conducted as part o f the NNP, which will provide additional useful data; these will be overseen by EHNRI.

Other data sources: Data for timely early warning (EOS/EWS), currently f lowing through the DPPA and F M O H /UNICEF/ENCU, would continue in the same way. The emergency healthhutrition unit o f the FMOH will monitor rates o f malnutrition through the IDSR protocol and HMIS . Whi le these are a l l existing sources o f data (with enhanced data to come through the IDSR protocol, which will be strengthened), under the project enhanced efforts will be undertaken to better understand and utilize these data (as wel l as other data sources).

Evaluation of the I D A project and the NNP, and the Overall Use and Analysis of Available Data: The various sources o f data mentioned above, and in particular the surveys with national coverage, will be used for the overall evaluation o f the proposed IDA project as wel l as more broadly the NNP as a whole. EHNRI will take charge o f the evaluation, contracting the evaluation work out to an independent body. In addition, EHNRI will take charge o f overall consolidation and analysis o f the diverse sources o f data listed above to produce outputs that will be useful for policymakers and specifically for decisions about program design. These efforts will include t r i ang~ la t i on '~ o f the data to be able to better interpret routine monitoring data. The consolidated data will enable r ich analysis to be carried out to enhance understanding o f the various factors affecting nutrition and the impacts o f various interventions. Some o f this consolidation and analysis work will be done by a separate agency contracted by EHNRI.

Operational Research (OR)

As part o f this component, various types o f operational research will be conducted regarding ongoing and potential nutrition-related interventions, including M&E activities. A preliminary l i s t o f topics on which such research will be conducted has been developed, and includes: (i) operational research to identify optimal means o f operationalizing Community-based Therapeutic Care (CTC) services at the health post and community levels; and (ii) research on optimal means o f increasing the timely introduction o f complementary food for infants. In the f i rs t year o f the project, a workshop will be held to concretize the topics that will be the focus o f the operational research.

EHNRI wil l oversee/manage the execution o f the identified types o f research and will coordinate the further identification, formulation and execution o f research questions that may arise in the process o f the implementation o f the NNP. Among other things, a fund will be set up for small- scale research projects with funding to be awarded on a competitive basis o n proposals evaluated by independent reviewers selected by the government. A portion o f the funding will be reserved to support research conducted as part o f academic theses. This fund will be managed by EHNRI.

Triangulation determines the bias o f facility-level data by comparing i t to population-level data. Since facil i ty data i s collected frequently and population (Le. national surveys) data less so, this bias can be used to determine population-level values in years without large and expensive national surveys.

19

- 36 -

c 0

c m 5

;g rl

I

t- m I

e,

I

U 3

t 2. .- D O

.e t! Yd +I

Annex 5: Project Costs Ethiopia: Nutrition Project

Project Cost By Component Local Foreign Total

Supporting Service Delivery 10.4 6.0 16.4 Institutional Strengthening and Capacity Building 14.2 3.0 17.2 Total Baseline Cost 24.6 9.0 33.6 PhysicaVPrice Contingencies 4.3 1.7 6.0

U S $million U S $million US %million

Total Project Costs 28.9 10.7 39.6

~ ~~

Project Cost By Component (IDA Only) Local ~

Foreign Total U S $million U S %million U S $million

Supporting Service Delivery 5.9 6.0 11.9 Institutional Strengthening and Capacity Building 10.6 3.0 13.6 Total Baseline Cost 16.5 9.0 25.5 Physical/Price Contingencies 2.8 1.7 4.5 Total IDA Contribution 19.3 10.7 30.0

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Annex 6: Implementation Arrangements Ethiopia: Nutrit ion Project

Activity Category Community-Based Nutr i t ion (CBN)

Micronutrient Interventions

Implementation Arrangements for Proposed IDA Project

Implementing Agencies FMOH (mainly FHD and HEEC); RHBs; WOHOs FMOH (mainly FHD and HEEC); RHBs; WOHOs

The proposed IDA-supported project will have two components. Component 1 (Supporting Service Delivery) o f the proposed IDA project will fund critical activities within the areas o f Community-Based Nutrition (CBN) and Micronutrient Interventions, which are both a part o f Component 1 o f the NNP. Component 2 o f the proposed project (Institutional Strengthening and Capacity Building) will fund critical activities within Component 2 o f the NNP.

Activity Category Strengthen Human Resources and Capacity Building Advocacy, Social Mobil ization and Program Communication Strengthening Nutr i t ion Information' Surveillance (SNVS), Monitoring and Evaluation (M&E) and Operational Research

The lead implementing agency for the proposed IDA project will be the Federal Ministry o f Health (FMOH). Within FMOH, the main implementing units will be the Family Health Department or FHD (especially the Nutrit ion Unit) and the Health Extension and Education Center (HEEC), as wel l as the Ethiopian Health and Nutrit ion Research Institute (EHNRI). Although EHNRI i s under FMOH, i t i s an autonomous agency that typically handles i t s own procurement and financial management (financial reporting etc.).

Implementing Agencies FMOH (mainly FHD, HEEC and EHNRI); RHBs; WOHOs FMOH (mainly FHD and HEEC); RHBs; WOHOs FMOH (mainly FHD and EHNRI); RHBs; WOHOs

Within the health sector, F M O H wil l be supported for purposes o f implementation o f this project by the Regional Bureaus o f Health (RHBs) and the Woreda Health Offices (WOHOs). The activities o f the IDA project can be divided into five (mutually exclusive and exhaustive) categories, as described in Annex 4, and the implementing agencies for each o f these five categories are listed in Table A6-1:

Component 2 o f Project: Institutional Strengthening and Capacity Building 1

t I

Component 2 will involve, among other things, contracting out to local universities for the universities to conduct training, and also for the universities to manage nutritional surveillance sites (as part o f the Demographic Surveillance Sites or DSS). Component 2 will also involve contracting out o f some surveys and operational research activities. All o f this contracting wi l l be handled by EHNRI. Some o f the specific responsibilities o f the various implementing agencies regarding the proposed IDA project are listed below.

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(a) Federal Ministry o f Health (FMOH): FHD (especially Nutrition Unit), HEEC and HMIS unit

Act as the secretariat for the National Nutrit ion Coordinating Body (NNCB), undertake tasks such as drafting the agenda and notes for N N C B meetings and reporting regularly to the NNCB on implementation o f the NNP Monitor, coordinate and supervise the implementation o f NNP Coordinate linkages regarding NNP with other ministries/sectors and also among different agencies within FMOH Supportive supervision and follow-up o f activities undertaken by other ministries which are relevant to NNP Coordinate meetings and jo in t planningheviews with other sectors Help coordinate with other agencies’ funding going to interventions in NNP sectors other than health (e.g. for Agricultural Extension Workers) Suggest and monitor nutrition-relevant indicators for other related projects (in other nutrition-related sectors) Prepare annual plans and projects including budget plan Prepare contracts and terms o f reference o f services Develop/draft N N S related policy, legislation, technical guidelines, procedures and ensure enforcement o f these Provide technical input into the planning and implementation o f NNP interventions Undertake training needs assessment regarding NNP Develop training packages and standards Follow, monitor and supervise implementation as per set standards Organize external support for the NNP, both technical and financial Assist the regions (e.g. by providing technical support) in the implementation o f NNP Advocacy and NNP launching workshops at a l l levels Develop/revise existing heal thhut i t ion communication strategy, channels, messages and materials Oversee quality assurance monitoring o f nutrition components o f key field services Integrate routine nutrition data collected by HEWS at the community level into H M I S

(b) Federal Ministry o f Health (FMOH): Ethiopian Health and Nutrition Research Institute (EHNRI):

House different data sources and studies o n nutrition (including datalstudies f rom different localized government, donor and NGO programs) and analyze accordingly Interpret and reconcile different data items from different sources Support capacity building at different levels Triangulate different sources o f data to use facility level data to estimate trends o f population- or community-level indicators Provide overall M&E support for the NNP Oversee National and small-scale surveys Oversee the Baseline, Midterm and Final evaluations for the NNP Oversee nutritional surveillance for the NNP Provide analysis on the impacts o f different interventions and different factors o n nutrition indicators Provide data-based analysis useful to policymakers to decide where and how to target interventions in different sectors (food, health, water, etc.)

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0

0

Help identify areas for operational research Oversee/manage operational research for the NNP

(c) Regional Health Bureaus

0

Monitor, coordinate and supervise the implementation o f NNP at the regional and woreda levels Develop/draft technical guidelines and procedures Responsible for financial management and allocation o f budgets in the region Responsible for institutional capacity development in the region Organize advocacy, social mobilization and communication activities in the region

(d) Woreda Health Offices

0

0

Prepare woreda annual plan and budget for NNP activities Compile, analyze and disseminate nutrition-related routine data at the woreda level to the relevant bodies and assist in the appropriate use o f these data to address nutrition Provide technical assistance, coordinate and monitor the activities o f the HEP with regard to the functions o f NNP Organize Community Health Days in the woreda. Conduct regular review meetings within and involving those outside the health sector

(e) Hospitals

0

0

Training o f health professionals Undertake nutrition-related research

Inpatient treatment o f severe malnutrition Implement the Baby-Friendly Hospital Initiative Provide Vi tamin A and deworming Ini t ia l immunization at birth and fol low up doses to those coming for other services and from catchment area

( f ) Health Centers

Promotion o f ENA Treatment o f moderate and severe malnutrition (supplementary and therapeutic feeding as outpatient and inpatient) Provide Vi tamin A for children between 6 months and 5 years and i ron and folate supplementation for pregnant women Providing deworming tablets for children above 2 years and for pregnant women during the second and third trimester o f pregnancy Undertake training on nutrition for HEW Immunization services at Health Center and management o f common childhood illnesses using Integrated Management o f Chi ld Illness (IMCI) algorithm

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(g) Health Extension Workers (at Health Post Level)

Implement the following nutrit ion service packages (of the HEP) for children and women: e

e e

e

e

e

e

e

e

e

e

Promote ENA for children and pregnant and lactating women Undertake monthly growth monitoring for children under 3 years Provide Vi tamin A for children between 6 months and 5 years and i ron and folate supplementation for pregnant women at health post and during outreach, EOS/CHD

Provide deworming tablets for children above 2 years and for pregnant women during the second and third trimester o f pregnancy at health post and during outreach, EOS/CHD days Demonstrate preparation o f complementary for children between 6 months and 24 months. Basic antenatal care, including treatment o f anemia, malaria and hook worm in pregnancy Immunization o f mothers and children Prenatal care with counseling on ENA, family planning and treatment o f anemia. Treatment o f childhood illnesses using I M C I algorithm and promotion o f community I M C I Mobi l ize the people for a l l types o f community and health post level actions in collaboration with the kebele health committees Conduct M&E o f community resource personsNCHPs by HEWs

days,

The project will provide funds mostly at the federal and regional bureau levels. T h e woreda-level expenditures will account for a relatively small percentage (8%) o f the total budget for the project. However, many activities wi l l in practice take place at the woreda level, even though expenditures for these activities are made through Federal or regional accounts. (About 13% o f the total budget for the project will be accounted for by expenditures made through regional accounts.)

A plan has been developed for implementation starting f rom the period before project effectiveness, with particular focus on the details o f implementation in the f i r s t year. A program preparation team (PPT) has been in place for about six months; to ensure a smooth start to implementation, at least two members o f this team will stay on we l l into the implementation phase. Critical activities will also take place starting immediately f rom the time o f project approval (or before), before project effectiveness, including: (i) actions as specified in Annexes 7 and 8 regarding Financial Management and Procurement; (ii) conducting a workshop in order to discuss project implementation in detail, including development o f work plans, as wel l as training on procurement, financial management and disbursement issues; (iii) development o f Terms o f Reference and bidding documents for activities that are to be conducted upfront (see the Procurement Plan), in particular regarding the baseline survey, given i t s size and complexity, and given also the need for minimum delays in conducting this survey. I f the project i s approved as planned, a review mission i s planned for around June 2008, with a particular focus on M&E activities for the project and the NNP (including appropriate planning for the baseline survey).

Training Arrangements

The proposed project will support both pre-service and in-service training activities relevant to nutrition for the four main categories o f workers: (i) “frontline” workers (e.g. HEWs and HEW

- 42 -

supervisors); (ii) midlevel managers working on nutrition-related areas (those working at WOHOs and RHBs); (iii) clinical nutritionists; and (iv) higher-level “supernutritionists” (e.g. those working at higher level institutions).

The relevant activities wi l l include working with universities and regional health colleges regarding nutrit ion and HEP-related training (for pre-service and in-service training). Within the health sector, the project will work with existing arrangements for training, as described below.

FMOH has a human resource and training department which wil l play a key role. This department i s responsible for the development of: standards; staffing needs; planning, monitoring and analysis regarding the available and future healthhutrition workforce; and negotiationdarrangements with higher-learning institutions regarding curriculum design and on the type and number o f graduates. The RBHs also have a similar arrangement.

In-service training, planning, implementation and supervision are primarily the responsibility o f the program departments at the federal, regional and woreda levels. The FMOH in most cases takes the leadership in the development and revision o f technical standards and training guidelines for in-service training and organizes national Training o f Trainers for regional trainers. The RHBs in turn use the national guidelines to r o l l out trainings to the woredas, health facilities and community based programs.

HEEC and i t s RHB counterparts assume total responsibility for the pre-service training o f HEWs and their instructors at the Technical and Vocational Educational Training institutes and for the in-service training o f the HEWs and their supervisors at the zone and woreda health offices. They, with technical input from the various departments o f FMOH or RHBs, direct the development o f training guidelines and the production and distribution o f various training, job-aid and communications/BCC materials for the HEP.

The management o f funds for in-service training follows a more or less similar procedure throughout the public health sector. Training funds will be allocated to the respective level (federal, regional or woreda) according to a prepared work plan and budget proposal. The funds will then be transferred to the accounts at the implementing level (accounts o f FMOH, RHBs or woredas) to effect payment for all training-related costs.

Inter-sectoral Coordinat ion

The NNP recognizes the critical importance o f inter-sectoral coordination to achieve good and sustainable improvements in nutrition outcomes for the country. One step towards this end wil l be to establish coordination bodies at the federal, regional and woreda levels to take charge o f ensuring inter-sectoral and inter-program coordination.

At the national level, two coordinating structures will be set up: (i) a National Nutrit ion Coordinating Body (NNCB), which i s a jo int Steering Committee that deals with pol icy issues; and (ii) a National Nutrit ion Technical Committee that deals with technical issues.

An action plan will be submitted by the government for the establishment o f an NNCB by the time o f Negotiations; the establishment o f this body i s a requirement stated in the officially approved N N S . This body will include high-level participation f rom different ministries that work o n sectors that affect nutrition. The body wi l l :

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0

0

0

0

0

0

0

Provide vision and general leadership Provide policy guidelines and coordination directives A c t as an advocate on nutrition matters Coordinate nutrition programs within participating ministries, other government institutions, development partners (DPs) and C iv i l Society Organizations (CSOs) Update the NNP based o n changing needs o f Ethiopia Mobil ize resources from government and development partners to support nutrition programs Review performance o f the NNP and give feedback

At the regional level, similar structures will be in place as for the federal level. Each region will have: (i) a Regional Nutritional Coordination Body that deals with policy issues, and (ii) a Regional Nutrit ion Technical Committee that deals with technical issues. The existing Woreda Development Committee i s proposed to oversee the coordination and implementation o f the NNP at the woreda level.

All of these bodies should have clear Terms o f Reference with details including the frequency o f meetings, key performance indicators (outcome and process indicators) as well as progress on policy formulation that should be monitored on a regular basis.

Institutional Arrangements

Please see Annex 10 for a description o f institutional arrangements for the proposed IDA project as wel l as the NNP.

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Annex 7: Financial Management and Disbursement Arrangements Ethiopia: Nutrit ion Project

Introduction

The financial management (FM) assessment i s conducted in line with the Financial Management Practice Manual issued by the FM Board o n 3 November 2005. The objective o f the assessment i s to determine whether the implementing entities have acceptable financial management arrangements, which will ensure: (i) the funds are used only for the intended purposes in an efficient and economical way; (ii) the preparation o f accurate, reliable and timely periodic financial reports; and (iii) safeguard the entities’ assets. As part o f the FM assessment, the team visited the Ministry o f Health (FMOH) and Ethiopian Nutrit ion and Health Research Insti tute (ENHRI), and used i t s cumulative knowledge and experience about the country and existing projects implemented by FMOH. This assessment was conducted during the months o f February and March 2008.

An effective financial management system i s vital for the project because o f the need to deliver services quickly to a wide variety o f stakeholders. The objectives o f the project’s financial management system are to: (i) ensure that funds are used only for their intended purposes in an efficient and economical way while implementing agreed activities; (ii) enable the preparation o f accurate and timely financial reports; (iii) ensure that funds are properly managed and f low smoothly, rapidly, adequately, regularly and predictably to implementing agencies at all levels (federal, regional and woreda); (iv) enable project management to monitor the efficient implementation o f the project; and to (v) safeguard the project’s assets and resources.

Summary Project Description

The Project Development Objective (PDO) i s to improve chi ld and maternal care behavior, and to increase utilization o f key micronutrients, in order to contribute to improving the nutritional status o f vulnerable groups.

The project will be implemented by the GOE and consists o f two components: Supporting Service Delivery (Component 1) and Institutional Strengthening and Capacity Building (Component 2) to support the service delivery. The total funds provided to Components 1 and 2 from the proposed IDA project will be $14 mi l l ion and $16 mi l l ion respectively. A detailed project description i s given in annex 4.

Country Issues

The recently completed Joint Budget and Aid Review (JBAR) and the Fiduciary Assessment (FA) show that Ethiopia has made significant progress in strengthening public financial management in recent years. The JBAR, which was conducted by the Bank in collaboration with other donors, reviewed the Public Financial Management (PFM) system using the Public Expenditure and Financial Accountability framework. Out o f the sixteen indicators covered under this review, fourteen were on government’s systems for public expenditure planning, budgeting and reporting. T h e remaining two indicators are means to assess donor performance. Ethiopia scored high on seven o f the fourteen indictors, i.e. macroeconomic management, including aggregate fiscal discipline and minimizing fiscal r isks. The JBAR observes satisfactory progress in budgeting and accounting reform but notes that the adequacy and quality o f budget reporting leaves room for improvement and remain a key concern.

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The status o f P F M reform and performance varies between regions. Southern Nation and Nationalities Peoples (SNNPR) and Tigray regions have been the beneficiaries o f investment and local initiatives to support PFM reform. They both show improvement in the overall public finance function and a consequential reduction in fiduciary risk. A few other regions, such as Amhara and Oromoia, have also exhibited significant progress in public financial management while others are at an earlier stage o f investment in PFM. However, there continues to be capacity and staffing issues in areas such as audit in al l the regions. An additional concern i s that while there have been improvements in the financial discipline associated with government funds, the increasing use o f other funding mechanisms such as in the Food Security Program has the potential to increase fiduciary risk. This i s because the use o f alternative funding mechanisms creates additional workload in areas where capacity i s already stretched. I t must be noted that there i s a shortage o f qualified accountants and auditors in the country.

Ethiopia’s public financial management reforms have been carried out through the Expenditure Management and Control Sub-program (EMCP) o f the government’s c iv i l service reform program. E M C P has developed a revised strategic plan to implement the nine components o f the sub-program. Mobil ization behind the EMCP (in terms o f financial and human resources) i s a key component o f the Public Sector Capacity Building Program (PSCAP) and has now been considered a priority in order to achieve further improvement in al l aspects o f financial management,

Overview of the PEFA assessment report

An evaluation o f Public Financial Management (PFM) performance in Ethiopia has been conducted in early 2007 based on an international reference framework -the Public Expenditure and Financial Accountability framework. The assessment was done at the federal and regional levels and two separate reports were issued. Seven regions were included in the assessment.

The draft assessment report issued in April 2007 observed significant improvement in the area o f financial management at regions, including budgetary transparency in recent years, robust budget preparation, regular internal audit scrutiny and fol low up o f internal audit recommendations, timeliness o f in-year and annual financial reports and mutual supportiveness o f the federal and regional Auditor Generals. Nonetheless, the report noted that the quality and nature o f internal audit i s uneven among the regions. I t also reported untimely clearance o f suspense accounts and that some regions are s t i l l experiencing significant delays in producing timely in-year and end o f year information. The report further identified capacity limitations in reviewing annual budgets.

The report for the assessment conducted at the federal level shows that the classification o f the budget meets international standards and the information included in the budget documentation i s o f good quality. The fiscal relations between the federal government and the regions are transparent. The report also noted that the budget process i s wel l ordered with the existence o f a budget calendar generally adhered to and a budget circular issued to budgetary institutions. Payroll and procurement controls are identified as being satisfactory while control for non-salary expenditure shows some weaknesses. Internal audits are also improved over recent years although the department does not share i t s work with the Federal Auditor General. The report indicated that the quality o f in-year budget reports and annual financial statements i s satisfactory and delays in submitting financial statements to the Office o f the Federal Auditor General (OFAG) have been significantly reduced. However, the report also noted that the cash f low management i s not fully established and the public has limited access to key fiscal information, though the government posts the required information on i t s website.

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The federal government report also shows that the OFAG adheres to International Organization o f Supreme Audit Institutions auditing standards and focuses on significant issues. OFAG forwards audited accounts on time and these are reviewed by the parliamentary Public Accounts Committee.

The report also looked at the status o f the government reform processes. It i s highlighted that the f i rs t phase o f the reform (transaction platform) has taken place through budgeting, planning, accounting, and information systems. The second phase o f the reform, pol icy platform, i s continuing at the sub-national level with reforms to the block grant mechanisms and a move towards more performance-based budgeting. The government leadership and ownership regarding ongoing P F M reform efforts are both high. The report however observed challenges in carrying out these reforms: diff iculty in accessing the PSCAP funds into which the Expenditure Control and Management Program i s tied to, qualified professional staff are thin at the sub- national level, particularly at the woreda level, and lack o f some basic office infrastructure.

Risk Assessment and Mitigation

Inherent risk Country

level

Entity level

Project level

S

S

FM manual

S

S N

-T- (Effectiveness)

The risk arises mainly f rom weak capacity, including shortage o f qualified accountants and auditors, and weaknesses in the country’s P F M system. I t i s being addressed by the GOE outside this project through the ongoing Expenditure Management and Control Program which i s supported by the Public Sector Capacity Building Project (PSCAP). Also, the Private Sector Capacity Development Project i s supporting some private sector initiatives. The number o f accountants at every level i s l o w and this i s aggravated by high turnover o f staff. Preparation o f clear FM manual and recruitment o f additional accountants wi l l

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Control Risk

Budgeting

Accounting

Internal Control

Funds Flow

Financial Reporting

Auditing

S

M

M

M

M

S

S

recruitment o f additional accountant (or equivalent)

The government accounting system will be revised to accommodate the needs o f the project

Formats o f un- audited Interim Financial Reports (IFRs) were developed and agreed during negotiation FMOH will close the project accounts within three months after

M

M

M

M

M

M

M

N

Y (Effectiveness)

N

N

N

N

implementing entities.

All implementing agencies prepare annual budgets, mainly following the government budget system. The existing chart of accounts will be revised in light o f the project specific needs.

The internal audit departments at a l l levels w i l l perform internal audits on the project financial transactions. Moreover, the F M manual will set out important control procedures. The financial management manual wi l l clarify the fund flow arrangement for the sroj ect. Regular financial reports o f :he ongoing projects :implemented by FMOH) lave not been submitted to [DA.

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Risk Rating

the end o f each fiscal year so that the audit wi l l be completed by the due date. Moreover, early notification and follow-up will be exercised to ensure that audit i s completed within the due date

Residual

M 1 Overall I S I RiskRating I H-High, S-Substantial, M-Moderate, L -Low

Strengths

The country’s discipline in executing budget and complying with the existing government regulations are the major strengths indicated in most o f the PFM diagnostic works conducted so far. FMOH has previous experience in implementing donor-financed projects, including Bank- financed projects. The FMOH i s currently implementing Component 2 o f the Protection o f Basic Services (PBS). FMOH was implementing Health Sector Development Programme, which was closed in June 2006.

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Signifcant Weaknesses

Lack o f adequate staff at the Finance Departments o f FMOH and RHBs

Action

Recruitment or assignment o f additional accountant (or equivalent) at the

Lack o f submission o f

Responsible Person

- FMOH

FMOH - Prepare IFR formats - FMOH

- FMOH regular IFR andor l o w quality IFR

Delay in submitting audit reports

- WB, FMOH

- Organize continuous training for finance staff o f a l l implementing entities - Closer follow-up on the submission o f IFR - Prepare audit TOR - Early recruitment o f auditors

FMOH

Completion Date

Before effectiveness

- Before effectiveness - Regular

- Regular

- Before negotiation - Within 3 months after effectiveness

Implementing Entities

FMOH has been designated as the lead implementation agency for the project. Accordingly, FMOH will be the lead agency overall in charge o f the project. However, other implementing agencies such as the RHBs and the Woreda Health Offices (WOHOs) will also be involved in the implementation o f the project.

Other ministries, programs and sectors will also play a key role in the project as i s essential given the multi-sectoral nature o f the malnutrition problem. I t i s envisaged that the Ethiopian Nutrit ion and Health Research Institute (ENHRI), an autonomous research institute under FMOH, will carry out a number o f activities financed by the project.

The finance unit at FMOH will be responsible for the financial management o f the project. I t i s envisaged that there will not be separate project implementing unit for the project at any level.

Budgeting

The Ethiopian budget system i s complex, reflecting the fiscal decentralization structure. Budget i s processed at federal, regional, zonal (in some regions), woredas and municipality levels. The federal budgeting process usually begins by issuing the budget preparation note to the Budgetary Institutions. Based on the budget manual, the Budgetary Institutions prepare their budgets in line with the budget ceilings and submit these to MOFED within six weeks following the budget call. The budgets are reviewed at f irst by MOFED and then by the Council o f Ministers. The final recommended draft budget i s sent to Parliament around early June and expected to be cleared at the latest by the end o f the fiscal year.

FMOH, RHBs and ENHRI prepare annual budgets based on their respective strategic plans following the government budget processes. FMOH’s and ENHRI’s annual budget i s included in the annual budget proclamation o f the federal government and the annual budgets o f the RHBs are included in the regional budget proclamation. Each o f the implementing agencies prepares

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regular reports comparing actual and budget and submit the same for management and donors for information and decision making.

Accounting

All implementing entities use MOFED’s system o f accounting - modified cash basis o f accounting o n a double entry accounting system. Manuals, formats and guidelines o f M O F E D are being used in recording and reporting o f financial transactions.

F M O H i s using Integrated Budget and Expenditure (IBEX) accounting software for government funds. All donor financed funds are also captured in IBEX. However, as IBEX does not allow reporting o f expenditures o n activity levels and by donor types, the Finance and Supply Department in the Ministry maintains separate records for each donor using Peachtree accounting software. The same accounting software wi l l be used for this project.

ENHRI has a finance department which i s organized in two divisions: a Project account division and Regular Government accounts division. The Project account division i s responsible for account reporting o f donor financed projects. The division uses Peachtree accounting software to prepare accounts.

RHBs have their own project accounts units, which look after the financial transactions o f donor- financed projects. The project accounts units use their own formats and chart o f accounts so as to fulfill donors reporting and auditing requirements. Pursuant to the government pooled accounting system at woreda level, woreda health offices will manage their funds through the woreda finance offices.

In order to get uni form reports f rom al l the implementing agencies, i t i s necessary for F M O H to develop a standardized reporting format and chart o f accounts to be used by al l agencies. Thus, the existing accounting system, including chart o f accounts, needs to be revised to accommodate the recording and reporting o f the project transactions. This wil l be an effectiveness condition for the project.

F M O H wil l develop the financial management manual for the project in line with the government accounting system. The accounting systems and policies for this project wi l l be documented in this manual. This manual wi l l be used by (i) the project staff, including FMOH, RHBs, woreda finance offices, and ENHRI, as a reference guide; (ii) IDA to assess the acceptability o f the project accounting, reporting and control systems; and (iii) the auditors to assess project accounting systems and controls and to design specific project audit procedures.

Specific procedures will be documented in the manual for each significant accounting function. They will be written to depict document and transaction flows, and will cover, among others, the following aspects: f l ow o f funds; record keeping and maintenance; chart o f accounts; formats o f records and book o f accounts; accounting procedures for authorization, recording and custody controls; planning and budgeting; financial reporting (including formats, linkages with Chart o f Accounts and procedures for reviewing these); internal controls; and auditing arrangements.

Following the recently completed Business Process Re-engineering (BPR) in the FMOH, procurement and finance departments were merged as Finance and Supply Department. This new Department has 7 accountants working on revenue and disbursement matters, while 5 accountants

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work on accounting and recording. The qualification and experience o f these accountants vary f rom certificate holders to BA in accounting graduates (4).

The overall assessment o f staffing arrangement at FMOH revealed that the existing accountants are overstretched in managing various donor funds. In order to strengthen the staffing capacity at FMOH, a Financial Management Specialist (or equivalent) will be recruited. The finance department in the ENHRI has a relatively better capacity and experience in financial management o f donor funds. The finance department o f ENHRI has f i f teen accountants o f which two have a first degree in accounting and three has college diploma in accounting. The project accounts units in the RHBs do not have adequate and experienced staff to handle the project transactions. The capacity o f these implementing agencies should be strengthened with support f rom FMOH. The woreda finance offices will use their regular finance staff to look after this project. Accountants to be assigned for the project by the RHBs are expected to build the capacity of woreda finance offices through regular visits.

The hiring or assigning o f one additional accountant (or equivalent) at FMOH, with the required educational background and experience, will be an effectiveness condition for the project.

Each o f the implementing agencies i s responsible for maintaining the project’s records and documents for a l l financial transactions that occur in i t s office. These documents and records will be made available to the Bank’s regular supervision missions and to the external auditors.

Internal Control and Internal Auditing

Internal control comprises the whole system o f control, financial or otherwise, established by management in order to: (i) carry out the project activities in an orderly and efficient manner, (ii) ensure adherence to policies and procedures, (iii) ensure maintenance o f complete and accurate accounting records, and (iv) safeguard the assets o f the project

All implementing agencies are using those control procedures prescribed ,by the government. These procedures are adequate to ensure authorization, recording and custody controls. The project financial management manual will further clarify other important control procedures peculiar to the project, such as procedures for periodic accountability, fund f low arrangement, auditing, etc.

FMOH has an internal audit unit o f 10 staff with varied qualifications and experience. The unit performs internal audits (performance and financial audits) on donor-financed projects. The unit i s involved in the month-end and year-end cash counts, conducting post-audit on government and donors funds, and reviewing financial reports sent to MOFED. The internal audit unit i s currently performing post-audit on the EFY 99 (2006/07) project financial transactions. ENHRI has an internal audit unit with three staff and i t s capacity to audit donor-financed projects i s limited. Similarly, RHBs have their own internal audit units. However, they are not providing a l l the required audit services to donor-financed projects due to understaffing.

The government C iv i l Service Reform Program i s building the capacity o f internal audit in the country. So far, internal audit manuals have been issued and training has been provided to internal auditors. The improvement in internal audit has been recognized in recent diagnostic works, e.g., the FA assessment.

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The internal audit units at each o f the implementing agencies will include the project in their annual audit work programs and perform the necessary internal audit on the project financial transaction.

Funds Flow and Disbursement Arrangements

The proposed IDA-supported project will provide funding to FMOH which wil l be the main implementing agency together with the ENHRI, RHBs and WOHO (who will receive funding channeled through the FMOH).

Disbursement Mechanism

The project may fol low one or a combination o f the following disbursement methods: Designated Account, Direct Payment, Reimbursement and Special Commitment.

Designated Account and Disbursement Method:

T o facilitate project implementation and reduce the volume o f withdrawal applications, FMOH will open a Designated Account denominated in U S Dollars in the National Bank o f Ethiopia on terms and conditions acceptable to IDA. A corresponding local account in ETB will also be opened in FMOH to receive transfer f rom the U S D account. FMOH will manage the U S D and ETB accounts.

The local account in ETB would finance al l eligible project expenditures at the respective offices and would be used by FMOH to transfer funds to other implementing agencies. The authorized ceiling o f the Designated Account would be US$3 mi l l ion. The amount has been calculated to cover approximately four months expected expenditures o f the project.

Each o f the other implementing agencies, such as RHBs, ENHRI and woreda finance offices, wi l l open an ETB account to receive funds from FMOH. Advances to these agencies f rom FMOH will be based on the approved work plan. The init ial advance will cover four months expected expenditures and the subsequent transfer will be based on actual expenditures justif ied through statements o f expenditures, and will only be made to those agencies that provide regular financial reports to FMOH. Before transferring any money to the lower levels, FMOH will ensure that separate bank accounts have been opened and there are adequate financial management systems including financial management staff capable o f producing the required financial deliverables.

Disbursement o f IDA funds to the Designated Account opened at the National Bank o f Ethiopia will init ially fo l low Transaction-Based Disbursement through the use o f a statement o f expenditures (SOE). Thereafter, the option o f using the Report-Based Disbursement method could be considered subject to the quality and timeliness o f the consolidated IFR and audit reports submitted to IDA by FMOH. In this case, cash forecast will be included in the quarterly IFRs (see reporting section below) submitted to IDA.

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The fund f low arrangement for the project i s summarized in the following chart.

ETB account at FMOH

IDA Grant Account '4'

4 - 7 * 1

DesigGted Account in US$ atIFMOH

I

A I I I I

I I

I 1 I I

ETB account at ENHRI

I + ETB account at woreda finance offices

The allocation o f IDA Grant Proceeds will be based o n the project components. Such an option will facilitate the monitoring o f the project performance indicators as wel l as financial aspects since expenditures are directly allocated to components. Request for replenishment o f the Designated Account for expenditures incurred under each component will be based on expenditures incurred at the implementing agencies for which justification o f utilization has been provided.

FMOH will be responsible for paying to contractors, service providers and suppliers for all works done, goods procured and services obtained in i t s Ministry. Likewise, RHBs, ENHRI and WOHOs will be responsible for effecting payments for a l l services obtained and goods procured in their offices.

Reporting on use of Grant Proceeds and SOE limits

Disbursements for a l l expenditures should be made against full documentation except for contracts valued at less than (i) US$ 150,000 for goods; (ii) U S $ 100,000 for consulting f i r m s and (iii) US$ 50,000 for individual consultants as wel l as operating costs which will be claimed on the basis o f SOEs. All supporting documentation for SOEs wil l be retained at the FMOH and each o f the other implementing agencies where financial transactions occurred. They will be kept in a manner readily accessible for review by regular IDA missions and internal and external auditors. The statement o f expenditures will be included in the Withdrawal Applications that will be submitted to IDA o n a monthly basis.

The supporting documentation for reporting eligible expenditures paid f rom the Designated Account will be summary reports and records evidencing eligible expenditures for payments against contacts valued above the SOE thresholds defined above. The supporting documentation

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for direct payment requests should be records evidencing eligible expenditures (i.e., copies o f receipts, suppliers' invoices, etc.). The project will submit a bank statement and a reconciliation o f the Designated Account together with the Withdrawal Application on a monthly basis.

Expenditure Category Supporting Service Delivery

Minimum Value of Applications

Amount in U S $ Financing Percentage 1 1,900,000 100%

The minimum value o f applications wi l l be set according to the Disbursement Letter to be sent for the Project.

(component 1) Institutional Strengthening and Capacity Building (Component 2) Unallocated Total

Counterpart Funding

13,600,000 100%

4,500,000 30,000,000

The government's contribution will include: (i) the time o f Health Extension Workers and other health sector personnel (including at FMOH and EHNRI) going into nutrition activities (this has been costed by valuing their time on a proportional basis, based on total salary); and (ii) the use o f health facilities and related equipment for nutrition activities.

Allocation of Grant Proceeds

Financial Reporting

Financial reports will be designed to provide quality and timely information on project performance to project management, IDA and other relevant stakeholders. The existing accounting and reporting systems o f FMOH, ENHRI, RHBs, and woreda finance offices are capable o f producing the required information regarding project resources and expenditures. Duties o f each implementing entity in the preparation o f the regular financial reports are explained below.

Based on the regular reports received from RHBs and ENHRI, it i s the responsibility o f FMOH to prepare consolidated quarterly Interim unaudi ted Financial Reports (IFRs) and consolidate annual accounts and facilitate the external audit o f the consolidated accounts.

RHBs and ENHRI will each be responsible to submit regular financial reports to F M O H on a quarterly basis.

Woreda finance offices will be responsible to prepare and submit to RHBs quarterly reports. RHBs will consolidate these reports and submit the consolidated reports to FMOH.

Formats o f the interim financial reports for this project were developed by FMOH and were with IDA during project negotiation. In addition, these formats wi l l be included in the financial management manual o f the project.

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On the basis o f financial reports received from the relevant implementing agencies, including RHBs and ENHRI, FMOH will submit a consolidated IFR to IDA within 45 days after the end o f each quarter. As explained above, submission o f regular financial reports to the higher tiers will be conducted within the timeframe prescribed in the FM manual. T h e consolidated IFR by FMOH shall include, at a minimum, the following: statement o f sources and uses o f funds; statement o f expenditures classified by Project components and or disbursement category (with additional information on expenditure types and implementing agencies as appropriate) showing comparisons with budgets for the reporting quarter and cumulatively for the project l i fe ; cash forecast; explanatory notes to the IFR; and Designated Account activity Statements.

Audit Report The project audit report - by FMOH

In compliance with International Accounting Standards and IDA requirements, FMOH wil l produce annual financial statements. These include: (i) a Balance Sheet that shows Assets, Liabilities and fund balance; (ii) a Statement o f Sources and Uses o f Funds showing al l the sources o f Project funds, expenditures analyzed by Project component and or category; (iii) a Designated Account Act iv i ty Statement; (iv) a Summary o f Withdrawals using SOE, listing individual withdrawal applications by reference number, date and amount; and (v) Notes related to significant accounting policies and accounting standards adopted by management and underlying the preparation o f financial statements. These financial statements will be submitted for audit at the end o f each year.

Due Date By January 7 o f each year (starting 2010)

FMOH has submitted quarterly IFRs up to January 8, 2008 for the ongoing PBS Component 2. However, a statement o f expenditures analyzed by project components or category i s not included in the reports and explanatory notes for major variances (actual expenditures vs. budget) are not given.

Auditing

The Office o f the Federal Auditor General (OFAG) i s responsible for carrying out the audit o f a l l the financial transactions o f the federal government and subsidies to the regions. Each o f the regions has a regional Auditor General responsible to audit financial transactions in the region. OFAG usually delegates i t s responsibility mostly to the Audit Services Corporations, the government owned audit firm and in some cases to private audit f i r m s to carry out the audit o f donor-financed projects. For this project, OFAG will assign external auditors acceptable to IDA. FMOH prepared an audit TOR and the audit TOR was agreed to. In addition, the project auditors should be recruited within 3 months after the project effectiveness.

According to the audit policy o f IDA, F M O H will prepare consolidated project annual accounts, including al l the statements explained above, and the auditors will express a single opinion on each o f these consolidated accounts. FMOH wil l submit to IDA audit reports six months after the end o f each fiscal year, which ends o n 7 July o f each year. The external auditor for the project should be recruited or retained within 3 months after project effectiveness. Audit reports to be submitted for the project are summarized below.

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Conditionality

1. The adoption o f a Financial Management Manual i s an effectiveness condition to the project. The manual should incorporate an adequate financial management system to record and report the financial transactions o f the project.

2. As a condition for effectiveness o f the project, the required Financial Management Specialist (or equivalent) should be recruited at the FMOH.

Supervision Plan

Financial management supervision missions will be conducted over the project’s lifetime. Due to the fiduciary r isks associated to this project, more o f each supervision mission’s budget wi l l be allocated in order to increase the frequency o f controls. At least three supervision missions are planned during the f i r s t two years o f the project implementation to ensure that adequate and effective financial management systems are set up and maintained for the Project throughout i t s lifetime.

Joint FM-procurement missions shall be envisaged to facilitate logistics and strengthen the Bank fiduciary control and support. A review o f the project expenditures will also be carried out during the regular supervision missions with a view to ensuring that expenditures incurred by the project at a l l levels are eligible for IDA funding. The Implementation Status Report will include a financial management rating for the project.

Financial Covenants

1. FMOH will submit the audited project accounts to IDA 6 months after the end o f each fiscal year. The fiscal year ends on 7 July o f each year.

2. FMOH, after receiving the financial reports f rom a l l implementing agencies, will submit un- audited IFR to IDA forty-five days after the end o f each quarter.

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Item

1

2

3

4

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Action to be taken Expected completion Responsible date body

Preparation o f a Financial Management Before Effectiveness FMOH Manual for the project and training provided on the manual Recruitment o f Financial Management Before Effectiveness F M O H Specialist (or equivalent) at FMOH

Organize a workshop for finance staff at a l l levels to equip them with the financial Effectiveness management arrangement o f the project Recruitment o f external auditor for the new project (contract signed) effectiveness (dated

Within 1 month after FMOH

3 months after project

covenant)

F M O H

Annex 8: Procurement Arrangements Ethiopia: Nutrit ion Project

Procurement Environment

Public sector procurement in Ethiopia follows the federal structure o f the government. Procurement at federal level i s governed by proclamation no. 430t2005, 'Determination procedures o f public procurement and establishing i t s supervisory agency proclamation o f the Federal Democratic Republic Government o f Ethiopia' dated January 12, 2005 and the Federal Public Procurement Directive o f July 2005. The proclamation has been reviewed by the Wor ld Bank and found to be satisfactory.

Fol lowing the proclamation and directive the Public Procurement Agency o f the Federal Government prepared Standard Bidding Documents (SBD) for procurement o f works, goods and selection o f consultants and distributed to Federal and Regional Government bodies.

Procurements at regional and woreda level are governed by their respective regional code. Subsequent to the Federal Government enactment o f the code, Addis Ababa and Di re Dawa City Administrations and al l the regions except Harari and Afar enacted their respective code, based on the model law prepared by the Federal Public Procurement Agency (PPA). Harari and Afar regional states are expected to prepare and ratify their respective codes shortly. The codes proclaimed by the regions or c i ty administration needs to be followed by directive, and establishment o f the independent regulatory agency for effective implementation. I t i s noted that, though the codes ratified by the regional states and city administration were prepared on the basis o f the model law provided by the Federal Public Procurement Agency (PPA), the code ratified by some o f the regions has not had the provisions for establishment o f independent regulatory agency.

The Country Procurement Assessment Report (CPAR) done in 2002 identified weaknesses in the country procurement system. The Government has taken the aforementioned actions based on the recommendation o f the CPAR. The main outstanding issue in public procurement at all levels i s the lack o f capacity. The main areas o f concern include: (i) building procurement capacity including having trained and qualified procurement officers in place and an appropriate institutional and decision making structure; (ii) ensuring that awareness i s created on the applicable procedures and ru les at each woreda, including availability o f standard procurement documents; (iii) establishing and/or strengthening federal and regional public procurement agencies; and (iv) Monitoring and Evaluation o f procurement activities including procurement review staudit.

General

Procurement for the proposed project would be carried out in accordance with the Wor ld Bank's "Guidelines: Procurement Under IBRD Loans and IDA Credits" dated M a y 2004 Revised October 1, 2006; and "Guidelines: Selection 'and Employment o f Consultants by Wor ld Bank Borrowers" dated M a y 2004 Revised October 1, 2006, and the provisions stipulated in the Legal Agreement. The various items under different expenditure categories are described in general below. For each contract to be financed by the Grant, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, the implementing agency, and time frame are agreed between the Borrower and the Bank in the Procurement Plan. The Procurement Plan wil l be updated at least annually or as

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required to reflect the actual project implementation needs and improvements in institutional capacity.

Procurement o f Works: N o works procurement envisaged under this project.

Procurement o f Goods: Goods procured under this project would include: laboratory equipment; adults scales and infant scales; vehicles and motorcycles; printing o f educational materials and family health cards; and micronutrients (irodfolate and zinc tablets); deworming tablets; furniture; and office equipment (computers, printers, etc.). The procurement will be done using the Bank’s SBD for al l I C B and National SBD agreed with or satisfactory to the Bank. To the extent practical, contracts shall be grouped into bid packages estimated to cost the equivalent of US$ 150,000 or more and would be procured through international competitive bidding (ICB) procedures. Goods and Equipment contracts estimated to cost less than US$ 150,000 per contract may be procured using national competitive bidding (NCB) and national SBD agreed with or satisfactory to the Bank. Limited International Bidding can be used for procurement o f goods and equipment following paragraph 3.2 o f the Guidelines. Direct Contracting for goods and equipment may be used in exceptional cases, under circumstances consistent with paragraphs 3.6 and 3.7 o f the Guidelines. Shopping may be used for contracts with estimated values o f less than US$50,000 in accordance with paragraph 3.5 o f the Guidelines.

All procurements following I C B and N C B would be done at the FMOH and/or EHNRI. RHBs and WOHO may procure goods approved for shopping methods.

Procurement f rom United Nations Agencies may be used in accordance with Paragraph 3.9 o f the Guidelines. The Bank shall prior review and agree for each individual contract before engaging UN Agencies

Procurement o f non-consulting services: Procurement o f non-consulting services may be done using the Bank’s Sample Bidding Document for the Procurement o f Non-Consultant Services December 2002, Revised April 2007 for al l I C B & N C B bids or other National SBD agreed with or satisfactory to the Bank. Commercial methods o f common use in Ethiopia may be used for smaller contracts (such as transportation, publishing advertisements and IECs in gazettes, domestic journals, etc) estimated to cost less than US$ 50,000 and whenever competition for the contract would be very limited.

Selection o f Consultants: Consultant services under the project would include: development of educational and training materials; review o f communication strategy; surveys; technical assistance; project evaluation; development o f standards for data quality control; and audits. Most contracts with f i r m s will be awarded through the use o f the QCBS described under section I1 (2.1-2.31) o f the Consultant Guidelines, using the Bank’s Standard Request for Proposals. When appropriate, Quality-Based Selection (QBS) or selection under a Fixed Budget would be used in accordance with paragraphs (3.2 - 3.4) and 3.5, respectively. Consulting Services for audit and other contracts o f a standard or routine nature may be procured under the LCS method described under paragraph 3.6 o f Consultant Guidelines. Consulting assignments costing less than US$ 100, 000 may be procured using CQS described under paragraph 3.7 o f Consultant Guidelines. Single source selection can be used to contract f i r m s for assignments that meet the criteria set out under paragraphs 3.9 to 3.13 o f the Consultant Guidelines. Contracts for international consultants will be done by comparing the qualifications o f at least three candidates, in accordance with Section V o f the Consultant Guidelines. The consulting services to be provided by individuals required for the project include technical Assistance to the FMOH in the

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areas of: Communication specialist; Nutritionist; Project Financial Management Specialist; Project Procurement Specialist and Monitoring and Evaluation Officer.

Hiring o f government-owned enterprises and institutions, including universities and/or research centers, to provide consulting services should meet the criteria set out under paragraph 1.1 1 o f the Consultant Guidelines.

Short l i s t s o f consultants for services estimated to cost less than US$ 200,000 equivalent per contract may be composed entirely o f national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines. All selections o f consultants involving foreign f irms or for assignments with estimated cost exceeding US$200,000 would be carried out at the FMOH or EHNRI, as appropriate, following the implementation arrangement.

Operating Costs: Expenditures made for operational costs such as fuel and vehicle maintenance costs; stationery and sundries; and other similar office operation costs will fo l low Ethiopian Government practices in accordance with the Federal Public Procurement code and Directives released on July 2005 or, whenever those Directives do not apply, commercial practices commonly used for the same purposes.

Standard Bidding Documents and Manual: The procurement procedures and SBDs to be used for each procurement method, as wel l as model contracts for works and goods procured, are presented in the Project Procurement Manual. The Bank’s SBDs will be used for al l tenders for procurement o f goods and works under ICB. Domestic preference would be applicable under I C B in accordance with paragraphs 2.55 and 2.56 o f the Bank’s guidelines. The Federal Government’s SBDs for procurement o f goods and works for NCB were reviewed by the Bank and found to be generally consistent with the Bank’s guidelines and procedures. However, some provisions in the Government’s SBDs need to be adjusted to ensure that the documents are fully compatible with the Bank’s guidelines. The standard documents o f the government can be used for procurement o f goods and works provided that: (i) the standard documents are used for NCB without pre-qualification only; (ii) margin o f preference i s not applicable; (iii) use o f merit points for evaluation o f bids i s not allowed; (iv) foreign bidders are not excluded from participation; and (v) results o f evaluation and award o f contract are published.

The procurement procedures applicable to the project shall be outlined in the Project Procurement Manual (PPM). The SBDs to be used for procurement o f goods and works using N C B that are revised as per the comments provided and found to be acceptable by the Bank would be provided to each implementing agencies in the PPM.

Assessment of the agency’s capacity to implement procurement

The Federal Ministry o f Health (FMOH) i s the lead implementation agency and would be responsible for the overall coordination o f project implementation. Procurement activities o f the project will be carried out by FMOH and EHNRI at federal level and by Regional Health Bureaus (RHBs) and Woreda Health Offices (WOHO) at regional levels.

FMOH and EHNRI wil l be responsible for their respective goods procurements and selection o f consultants. In addition, FMOH will be responsible to carry out RHBs and WOHOs procurements following I C B goods procurement and selection o f consultants involving foreign f i r m s or for assignments with estimated cost exceeding US$200,000. RHBs and woredas would only procure goods using shopping method.

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Procurement Management capacity assessment o f the FMOH and EHNRI to implement procurement actions for the project has been carried out by Abiy A. Temechew on January 3 1 and Feb 1, 2008 respectively. The assessment reviewed the organizational structure for implementing the project and the interaction between the project’s staff responsible for procurement Officer and the agencies relevant central unit for implementing procurements.

FMOH

The FMOH i s the lead agency responsible for the overall implementation as well as coordination o f procurement activities. The Ministry directly and through the RHBs would implement procurements for Component 1 and part o f Component 2 o f the project. The Family Health Department o f the Ministry wil l be the focal point to organize and coordinate annual procurement demands o f RHBs, woredas and the Ministry’s internal units. The newly established Pharmaceutical Fund and Supply Agency (PFSA) - under the Ministry, for the procurement storage and supply o f pharmaceuticals - will be responsible for the day-to-day procurement activity o f the project. The office i s currently staffed with two procurement specialists and a consultant hired under the PBS project. Moreover, hiring o f a procurement agent i s being finalized to carry out the procurements under Component 2 o f the PBS. One o f the tasks o f the procurement agent i s to provide capacity building o f the PFSA staff on procurement, supply and distribution o f Pharmaceuticals. The Training among others should also focus on selection o f consultants and procurement records management, which i s one o f the weak areas o f the agency. F M O H would take the lead for the preparation o f PPM. The manual would layout detailed procurement processes and procedures applicable to the project covering FMOH and EHNRI down to the woreda level. The manual among others should define the linkage between the Ministry and PFSA including their individual role and responsibility, mechanism for proper information f low and monitoring and other pertinent links for effective implementation o f procurements.

EHNRI

EHNRI was established under the Regulation o f the Council o f Ministers - Regulation 411995. The Board o f Directors i s the highest body o f the institution where the Minister o f Health i s the Chairman. Finance, Procurement and Property Management Department, which i s answerable to the Deputy Director, i s the responsible body to execute the institution’s procurement. At the time o f conducting this assessment EHNRI i s in the process o f organizational reform and one o f the planned structural changes i s to organize and structure the department to a higher hierarchical level led by a Deputy Director, accompanied with additional responsibilities.

The department has n o procurement staff except two purchasers for shopping purposes. However, it i s reported that whenever there i s a need for procurement through open competition the department head together with the legal officer would normally prepare bidding documents. In this arrangement, the institution handled few I C B goods procurements packages - procurement o f lab equipment; and several NCBs. Neither the institution nor the staff responsible for procurement has experience in Wor ld Bank or other donors’ procurement procedure. It i s also noted that the department had very few experiences in the selection o f national consultants, but has not had experience on selection o f consultants involving foreign f i r m s . The staff are familiar with the SBD’s issued by the federal PPA and started using these SBDs. Procurement Records management o f the institution i s weak and documents are not f i led systematically.

Most o f the issues/risks concerning the procurement component for implementation o f the project have been identified and include: (i) weak capacity and non availability o f specific procurement

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staff accountable for the day-to-day project procurement activities; (ii) loose organizational linkage between the project coordinating office and the departments responsible to carry out procurements (FMOH); (iii) experience on donor- or Wor ld Bank-financed procurements i s very l imited (EHNIU); (iii) poor records management - documents are available but not f i led systematically; (vi) the salary structure i s not attractive enough to get/retain qualified staff, (vii) delays in evaluation o f bids and consultants proposals (FMOH); and (viii) the links between EHNRI and FMOH should be defined for smooth procurement operation when involving foreign currencies - since only FMOH has access to the foreign currency account payments that would be made in foreign currencies including opening and amendment o f L/Cs, the link to facilitate payments should be properly laid.

24. The corrective measures which have been agreed are:

I tem No. 1

6

Activity

Assigdrecruit a procurement staff person who has the necessary s h l l to handle goods and selection o f consultants (minimum educational level - f i r s t degree) Define linkage and responsibilities and lay out a monitoring system that would enable FMOH to fol low up f l ow o f the project’s procurement activities at PFSA. - Procurement Manual Assign a specific procurement staff person from PFSA who i s responsible for the day-to-day procurement activities o f the project. Conduct orientation workshop for procurement staff at FMOH, EHNRI, RHBs, including people involved in the procurement decision making process and tender committee members. Provide checklist o f relevant procurement documents for proper records management; devise a proper procurement management, evaluation and decision making system. The applicable procedure should be defined in the Procurement Manual. Define the linkage and their individual responsibilities between F M O H and EHNRI, with regard to foreign payment - Procurement Manual

Responsible

EHNRI

FMOH

FMOH

FMOH/EHNRI, organize in consultation with the WB C O FMOH/EHNRI

FMOH/EHNRI

The overall project risk for procurement i s high.

The Project team would ensure that in reviewing P P M the above issues are addressed.

Procurement Plan

Expected Completion Date

Before effectiveness

Before effectiveness; Procurement Manual Before effectiveness

Project launch

Before effectiveness; Procurement Manual

Before effectiveness; Procurement Manual

The Borrower, at appraisal, will develop a procurement plan for project implementation which will provide the basis for the procurement methods. This plan will be agreed between the Borrower and the Project Team and will be available at the FMOH and EHNRI. It will also be available in the project’s database and in the Bank’s external website. The Procurement Plan will be updated in agreement with the Project Team annually or as required to reflect the actual

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project implementation needs and improvements in institutional capacity. FMOH would preparehpdate a consolidated annual plan for al l procurements that would be carried out at all levels o f implementing offices, except for EHNRI. In the same manner EHNRI will prepare the procurement plan covering i t s own procurements.

1 2 3 4 5 6 7 8

Prior/ Post Bid Invitation

Review

Estimated Procure- Domestic ment P-Q Preference Date Activity Cost in Activity

Code USD Method

Frequency o f Procurement Supervision

9

Comm- ents

Procurement o f I ron folate and Deworming

tablets

F M O H IOO3IIC B-NUT FMOH 100511c B-NUT F M O H IOO6IIC B-NUT F M O H IOO8IIC B-NUT FMOH IOO9IIC B-NUT EHNFU IOO2IIC B-NUT F M O H

10 1 1 ILC B-NUT

352,705 ICB N o Yes Prior

Prior Procurementofadult 1 ~ ICB 1 No ~ Yes ~ 442,500 scales and infant scales

Procurement o f Vehicles and Motorcycles

1,055,500 ICB No Yes Prior

1 403,924 1 ICB 1 N o 1 Yes 1 Prior Procurements o f computers and printers

I 205,228 I ICB 1 N o I Yes I Prior Procurement o f educational materials

1 420,000 1 ICB 1 N o 1 Yes 1 Prior Procurement o f Laboratory Equipment

Publication o f special issue onnutr i t ionin 1 6,000 1 LCB 1 N o 1 Yes 1 Prior

local journal (EPHA)

Nov 2,2008

Nov 2,2008

Jan 2,2009

Sept 25,2008

Nov 25,2008

Sept 0 1,2008

Sept 25,2008

(b) I C B contracts estimated to cost above US$ 150,000 per contract and all direct contracting will be subject to prior review by the Bank.

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Consulting Services

1

(a) L i s t o f consulting assignments with short-list o f international f i r m s .

2 3 4 5 6 7

Estimated Cost in USD

Contract Identificaton

No.

Procure- Prior/Post Shortlist Comment

Method ment Review Date S

Activity

EHNRI/04/ QCBS- NUT EHNRI/06/ QCBS- NUT

Baseline survey 349,650 QCBS Prior Jul 01, 2008

Operational study on 150,000 QCBS Prior JulO1, community 2008 management o f malnutrition

(b) Consultancy services estimated to cost above US$ 100,000 per contract and single source selection o f consultants (f irms) for assignments estimated to cost above U S $ 50,000 will be subject to prior review by the Bank.

(c) Short l i s t s composed entirely o f national consultants: Short l is ts o f consultants for services estimated to cost less than U S $ 200,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines.

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Annex 9: Economic and Financial Analysis Ethiopia: Nutrit ion Project

The project incorporates interventions that have substantially high benefits relative to costs. A benefit-cost analysis was recently undertaken for several interventions affecting nutritional outcomes in Ethiopia, as part o f the Economic and Sector Work done by the Wor ld Bank.”

The analysis computed three types o f benefits, where this was enabled by the available data: (i) the benefit f rom reducing chi ld and maternal mortality, measured as the value o f a l i f e saved, or o f a death averted (assumed to be equal to the discounted value in the child’s lifetime earnings); (ii) the benefit f rom increasing economic productivity; and (iii) the benefit f rom enhancing chi ld ability. In each case, a benefit-cost ratio (BCR) was computed. The total BCR i s equal to the sum o f the BCRs from reducing chi ld and maternal mortality, f rom increasing economic productivity and from enhancing chi ld ability.

The benefit f rom increasing economic productivity comes from the fact that many o f the analyzed interventions address the detrimental effects that come entirely or partly through stunting and L o w Birth Weight (LBW). These two outcomes result in significant economic losses throughout life, leading in turn to reduced economic productivity. The benefits f rom increased mental ability can be seen in particular with some micronutrients. The effects o f some micronutrients on the mental ability o f a chi ld can be quite dramatic. Iodine deficiency, for example, leads to the IQ o f a chi ld being reduced by 10 to 15 points, as much previous research has shown.

A number o f assumptions had to be made for the benefit-cost analysis. These are spelt out in detail in the Wor ld Bank report mentioned above. T h e findings are summarized in Table A9-1 and Figure A9-1

These cost-effectiveness and B C R estimates should be interpreted with caution. I t should not be assumed that interventions with lower estimates for the cost-per-death-averted should be advocated at the expense o f other programs. It i s critical to also use other indicators to evaluate and compare programs. For example, Community-based Therapeutic Care (CTC) programs are expensive, high-cost-per-death-averted interventions. However, at present in Ethiopia, CTC programs are the foremost way o f treating severe malnutrition, and there i s n o low-cost substitute. I t should be emphasized that each o f the interventions included in this analysis has been found to have a B C R above one, usually well above one, and each one serves an important purpose.

See “Malnutrit ion in Ethiopia: Current Interventions, Successes, Cost-Benefit Analysis, and the W a y 20

Forward”. Draft Report, Wor ld Bank. December 2007.

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1 1 1 1

111

v) E

3

4

E

0

2 c 5

1 $ 1 1 w m

a a a ?

$! z z z

0

1 1 1

1 1 1

ri N m a v

m a a a a a c 9 z z z z z 0

Figure A9-1. Benefit-Cost Ratios for Current and Potential Interventions

Intervention

Note: Graph shows total BCRs for current and potential interventions, f rom reducing childmaternal mortality, increasing economic productivity and enhancing chi ld abil ity. Deworming medication to pregnant women, with a BCR o f 829, has been omitted to show more detail for the other interventions.

Figure A9-2 compares the per capita cost o f an intervention with the number o f under-5 lives the intervention would save were i t to be scaled-up nationwide. Some o f the lowest cost per capita interventions are able to save the most lives. T o make the numbers o f lives saved comparable among interventions, they were scaled-up to assume that they were implemented nationwide. The analysis covers most o f the service delivery interventions in the NNP, and each one i s shown to have benefits that are several times or more o f the cost. Although Table A9-1 and Figure A9-1 do not provide B C R figures for preventative Community-Based Nutrit ion (CBN), due to lack o f data on this new program, figures are provided for several interventions that are currently a part o f existing community volunteer programs. These also come out to have high BCRs. Promotion o f optimal breastfeeding and o f handwashing, analyzed as part o f the ongoing Essential Services for Health in Ethiopia’s (ESHE) program, was found to have benefits that are several times the costs. These interventions will also be a part o f the new C B N activities.

Benefit-cost analysis has not been done for Component 2, due to lack o f available data on benefits or impacts. But, even if one assumes that Component 2 provides zero benefits, the BCRs for the Component 1 (Supporting Service Delivery) interventions are so high that the total benefits for Components 1 and 2 combined would s t i l l exceed the total costs for Components 1 and 2 combined. In other words, the total benefit for the proposed IDA project (which provides $14 mi l l ion and $16 mi l l ion for Components 1 and 2 respectively) would s t i l l exceed the total cost o f the project, even if one assumes that the benefits f rom Component 2 are zero. (For the

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overall NNP program, similarly, the total benefits would exceed the total costs, even i f one assumes that the benefits f rom Component 2 o f the NNP are zero.)

Figure A9-2: Number of Under-5 Deaths Averted and Cost Per Capita for Various Interventions

2.50

CI a 2.00 ‘E 8 1.50

ll 1.00

8 0.50

0.00

180 Z 160 8 140 120 9, 100 a. 80 60 cn

$, T -_ 9 40

20 Q 0 E

Note: The baseline for under-5 deaths represents the number from 2005. Each o f the possible scenarios i s based on a scenario o f scaling the program up nationwide.

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Annex 10: Description o f National Nutrition Program Ethiopia: Nutrit ion Project

I. Overview and Component Description

In order to implement the National Nutrit ion Strategy (NNS), which has just been officially approved, the GOE i s embarking on a National Nutrit ion Program (NNP) with the support o f donor partners. The f i rs t phase o f the NNP which spans five years (2008-2013) consists o f two main components: a Supporting Service Delivery component (Component 1) and an Institutional Strengthening and Capacity Building component (Component 2) to support the service delivery. Each o f these two main components has four sub-components, as detailed below.

Component 1: Strengthening Nutrition Service Delivery

Sub-Component l(a): Sustaining Enhanced Outreach Strategy (EOS) with Targeted Supplementary Food (TSF) and Transitioning of EOS into the Health Extension Program (HEP)

The ongoing EOS/TSF program i s an interim or “bridging” strategy focusing o n enhancing chi ld survival by reducing mortality and morbidity in children less than 5 years o f age and pregnant and lactating women, transitioning into the Health Extension Program (HEP) in the longer term. Health Extension Workers (an integral part o f the HEP) are already actively taking part o f the EOS/TSF. The NNP will seek to maintain the high coverage rates o f EOS/TSF as it transitions into HEP, including Community Health Days (CHDs) and Community-Based Nutr i t ion (CBN) as part o f HEP, the principle being to keep high service coverage with three-monthly or six-monthly events organised at kebele level.

The specific objectives o f EOS (services provided every six months), and, post-transition to proposed CHDs (full package every six months, reduced package - only screening and referral - quarterly) are to provide: (i) Vitamin A supplementation to at least 90% o f children 6-59 months old; (ii) deworming tablets to at least 90% o f children 2-5 years old; (iii) screening for acute malnutrition to at least 90% o f children 6-59 months old and 90% o f pregnant and lactating women; and (iv) referral o f the malnourished children and women to appropriate selective feeding programme (TSF and/or therapeutic feeding). The TSF programme i s jo int ly programmed with the EOS/CHD and aims to: (i) rehabilitate moderately malnourished under-5 children, as wel l as pregnant and lactating women who are identified during EOS/CHD screening in food-insecure woredas; (ii) enhance basic nutrit ion knowledge o f mothers and other women in communities targeted by EOS/CHD/TSF; (iii) incorporate TSF functions into the HEP including C B N to prevent moderate and severe malnutrition among under-2 children through CBN, as wel l as rehabilitate moderately malnourished under-2 children and pregnanvlactating women through a TSF-type mechanism. Full details o f the EOS/TSF as currently being implemented are given in the UN Country Program Action Plan for Ethiopia.

The HEWS will continue to provide the essential child survival package at the kebele level once every 6 months. Where the C B N programme i s developed, the screening will be done by the HEW every 3 months for early detection o f acute malnutrition and prevention o f severe malnutrition.

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Sub-component l(b): Management of Severe Malnutrition

The overall objective o f the ongoing Therapeutic Feeding Program (TFP) i s to enhance child survival by reducing mortality and morbidity in individuals affected by severe (acute) malnutrition. The specific objectives include: (i) creation o f TFP capacity at health center and hospital levels (increasing from 31% at baseline to 50 % in Year 5), thus integrating TFP into routine health delivery at these levels (ii) ensuring proper referral mechanisms from EOS/CHD to TFP and between the Therapeutic Feeding Unit (TFU) and the Outpatient Therapeutic Program; (iii) ensuring a proper referral mechanism for children discharged from TFP and returned to TSF- type feeding; (iv) integrating a national protocol for the management o f severe (acute) malnutrition into the curricula o f medical universities and nursing schools.

The in-service objectives o f this activity are: (i) cure rate to exceed 75%; (ii) defaulter rate to be less than 15%; and (iii) mortality rate to be less than 5%. The information system utilized by the program will track the proportion o f children who “default” in the referral mechanism and provide feedback to the concerned administrative entities in an effort to optimize referral and discharge mechanisms. Full details o f the TFP as currently being implemented are given in the UN Country Program Action Plan for Ethiopia.

Sub-component 1 (e): Community Based Nutrition (CBN)

This sub-component seeks to provide community-based nutrition and health services, fully uti l izing existing HEP outreach and model household service provision and seeking to build on these with additional community-based resources and activities in the most efficient and effective manner. This sub-component’s activities can be broadly classified into two categories:

(A) C B N activities relevant to HEWs and supervisors o f HEWs (based at health centers), especially training and provision o f relevant materials; and (B) CBN activities relevant to Voluntary Community Health Promoters (VCHPs)/model households, especially training and provision o f relevant materials.

These ultimately (once the full program i s fully rolled out) will be administered nationwide by HEWs, HEW supervisors and VCHPs/model households.

The preventative C B N package includes community mobilizatiodconversation through the Triple-A approach (Assessment-Analysis-Action), community-driven growth monitoring and promotion, promotion o f Essential Nutrit ion Actions and other chi ld and maternal caring practices, pregnancy weight gain monitoring, referral to health facilities, and multi-sectoral linkages using the HEWs supported by community volunteers and model households. In order for the C B N to work effectively, i t should identify and address both the immediate and underlying causes o f malnutrition. Thus, the rollout o f C B N will consider also the presence o f other programs l i ke Targeted Supplementary Feeding programs (TSF), Therapeutic Feeding Programs (TFP) and Productive Safety N e t Program (PSNP) and food security programs in order to address some o f the underlying causes o f malnutrition.

Preventative C B N will build community capacity through instilling the above-mentioned Triple A approach, which will focus on assessment, analysis, and action specific to preventing chi ld malnutrition. This will involve sensitization efforts at woreda, kebele and gotte levels, followed by community mapping, community based action and participatory assessments o f progress. Preventative C B N also aims to promote improved nutrition-related caring practices for children and women; to improve referral linkages to relevant child health and nutrition services and other

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linkages for addressing non-health causes o f child malnutrition; to develop and implement strong advocacy and a communicatiordmobilization strategy to support a l l C B N activities and to enhance capacity for C B N implementation at the regional and woreda levels.

The specific activities o f preventative C B N include improvement o f caring practices for maternal and child care through: (i) Essential Nutrit ion Actions and Chi ld Growth Promotion (including promoting ENA for children & pregnantllactating women through interpersonal and group communication, promoting other relevant child care practices by incorporating available B C C materials, promoting adequate growth o f every chi ld under 2 years o f age, establishing quarterly CHDs and maintaining the coverage and quality achieved through EOS, Community Management o f Malnutrit ion in the 31d to 5th year and building a capacity o f reporting and feedback to support effective follow-up actions); and (ii) maternal care (including promoting maternal care through interpersonal and group communications, establishing pregnancy weight gain monitoring activities, providing outreach services for pregnantllactating women by HEWs, including i ron and folate supplementation - complementing existing HEW/HEP efforts - and deworming); and (iii) adolescent care (including promoting adolescent nutrition and care through interpersonal and group communications).

The HEWs, supervised by HEW supervisors, will take charge o f the above activities, but as VCHPs/model households are trained and deployed, the HEWs will be supported by the VCHPs. Because o f the interdependence o f this program and health post/HEW services, NNP will seek to assure that the implementation o f C B N i s wel l coordinated with HEP expansion planning.

C B N will utilize existing HEP model household members, building o n these initiatives in ways most likely to achieve NNP and health sector objectives. Additionally, VCHP/model household training will include health topics as wel l as those explicitly nutrition-related.

C B N will place a primary focus on young children under the age o f 2, and wil l include 6 sets o f activities (ENA and growth promotion, targeted food supplementation, micronutrient supplementation, parasitic control, hygiene and sanitation) o f which nutrition i s centrally involved in 3 and closely l inked to the others. The C B N also will fo l low basic I M C I principles at the community level (this with the understanding that the primary growth monitoring wi l l take place at the community level rather than at the health post). Special attention will be focused on addressing the problem o f very late (and sometimes too early) introduction o f complementary food to young children.

The C B N sub-component will seek to assure referral to health posts o f severely malnourished children identified at CHDs (initially under age 5, subsequently under age 2) and through monthly growth monitoring (children under age 2 experiencing two consecutive months o f growth faltering and/or health problems identified through community based IMCI counseling). So far the full Community Management o f Malnutrition (CMM) package has been implemented as a project and in emergency context. M u c h o f C M M inpatient and outpatient care i s currently provided within FMOH health facilities. However, the geographical coverage s t i l l coincides largely with the 2003 NGO emergency response area. Moreover, CMM implementation in the routine health system includes only a part o f the full C M M package (mainly the screening, Outpatient Therapeutic Program, and inpatient care), and it i s not currently done at the health postlHEP level. The NNP envisages undertaking an operational study (see the operational research section o f the SNUS sub-component) to identify optimal means o f integrating C M M into the health post and community service delivery mode for the f i rs t two years, and then to scale up during year three to five as part o f the C B N sub-component. I t s implementation plan and scale will be developed after the outcome o f the operational research.

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Linkages wil l also be made with Water Sanitation and Hygiene and PSNP programs to address the sanitation, hygiene and poverty determinants o f malnutrition.

HEWS will take charge o f the weighing at the outreach site. In areas where VCHPs/model households are fully rolled out and fully trained with appropriate capabilities, each HEW wil l be supported by 4-5 VCHPs at each outreach site who will support the HEW in weighing activities, to mobilize the community; facilitate “community conversations” and growth promotion sessions; and provide follow-up support for families and women’s groups in need. The VCHPsimodel households will be provided skills-based training to undertake their j o b function efficiently. The HEWS will also be supported by model households.

CBN aims to integrate ENA counseling with “community conversation”/Triple-A processes, based on the data generated through the monthly chi ld weighing. The child weighing and recording makes invisible malnutrition problems visible to the community’s eyes (Assessment). HEWS (supported by VCHPs/model households in areas where the VCHPs/model households are fully rol led out), will provide counseling for care-takers based on the ENA/BCC and individual chi ld growth pattern recorded in the Family Health Card o f the child. Through multiple studies conducted in Ethiopia, i t i s known that causes o f inadequate child care practices often go beyond individual behavior; for example, a mother’s heavy workload and lack o f time i s one o f the major causes o f inadequate breastfeeding and complementary feeding. FMOH i s therefore developing a strategy, called “community conversations” to create supportive environments at family and community levels through community dialogues and collective actions. In CBN, periodic “community conversation” sessions will be organized by HEWs (and VCHPs/model households in areas where the VCHPs/model households are fully rolled out) who will receive skill-based training o n the use o f “community conversation” tools, such as community visioning/mapping and community growth chart (an enlarged community growth chart with growth data o f all children in the community), with support f rom local administrators and leaders. Facilitated by HEWS (and VCHPs/model households in areas where the VCHPs/model households are fully rolled out), community members will use the tools and information to jo int ly analyze causes o f the problems in the local context and discuss how they can address the problems in the family and community as a whole.

HEWs, being a member o f the kebele administration, will share the information in the kebele review meetings where Triple-A discussion wil l help them come up with a practical support plan for the communities. HEWS will also report to their respective WOHO, which i s responsible for providing supportive supervision and for sharing the information with the Woreda Administration. The progress will be repeatedly re-assessed through monthly weighing and Community ConversatiodTriple-A processes at each level.

With regard to utilization o f the weight data within W O H O as part o f the HMIS, skills-based training for VCHPs/model households needs to be carried out while the major existing training opportunities in HEP (e.g. Integrated Refresher Training) should be utilized for maximum results (currently Integrated Refresher Training for HEWS only allocates 2 days for al l nutrition interventions),

The proposed preventative C B N activities are similar in some ways to those o f the Community Growth Promotion (CGP) component o f the ongoing IDA-supported Food Security Project (FSP), although implementation arrangements differ. The FSP-CGP i s expected to continue until FY 10, and it will slowly be phased into the C B N activities o f the NNP.

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The effectiveness o f community-based services increases the effectiveness o f health posts and health centers with a high proportion o f needs taken care o f within the community i tse l f . With a significant part o f C B N focusing on preventative measures, the burden on the health system of dealing with severe malnutrition also will be decreased.

Sub- Compon ent I (d) : Micronutrient I n tewen tions and High -Impact Com m odities

The four main micronutrients o f concern, and those that will be the focus o f the NNP, are iodine, vitamin A, iron, and zinc. The focus will be on chronic problems, but also on acute outbreaks o f deficiency diseases as they occur (most importantly outbreaks o f goiter resulting f rom severe iodine deficiency).

Addressing Iodine DeJiciency Disorders (IDD)

IDD prevalence, affecting roughly 3.5 mi l l ion children in Ethiopia, i s dangerously high in parts o f the country with serious outbreaks o f goiter. The goal o f the GOE and NNP i s to achieve universal salt iodization (USI) in the country. In moving toward USI, efforts are underway to resolve issues and reach agreements at the federal, regional and producer level.

In 1994, standards were set for salt iodization, and these were enforced starting in 1995. At the time, most o f the salt in Ethiopia was being imported from Eritrea, and most o f the salt production was in government hands. Enforcement o f the iodization standards was therefore relatively easy at the time.

Then war broke out between Eritrea and Ethiopia. Ethiopia turned to new sources o f salt and i t s own domestic production capacity began to increase rapidly. Many new private salt producers entered the business, especially in Afar; these were mostly small producers. The Ministry o f Trade and Industry l i f ted the salt iodization standards in 1997, thereby removing any impediment to the production or importation o f non-iodized salt.

In 2000, Public Health Proclamation 200/2000 was issued by the Parliament. This stated, among other things, that “any person who produces or distributes salt for human consumption shall ensure that i t meets the standard requirement o f iodine content”. But the proclamation was not backed by appropriate measures to enforce it. In 2006, the Ministry o f Health issued a directive saying that this proclamation should be enforced by November 9, 2006. But this directive, again, did not have teeth without proper supportive measures o f enforcement.

Steps to implement necessary measures for enforcement have moved slowly because o f the local situation in the salt producing areas o f Afdera, with many producers (especially smaller ones) having fears o f being put out o f business in an already over-supplied market. A consultation with small, medium, and large salt producers has occurred and i s o n going. The consensus i s to provide iodization machines to medium and large salt producers as wel l as groups o f small salt producers who are forming cooperatives. Donors and involved parties are procuring the machinery, and training and technical support will be provided in the Afar region where the salt i s produced. Quality control will be carried out in salt producing areas and in each region. A mass communication plan prepared by Population Services International (an NGO) in response to government request will provide the population with information on the value o f the new salt.

One o f the agreements o f the NNP (and o f the proposed IDA project) i s for the adoption and enforcement o f Universal salt Iodization (USI), by the end o f the second year. Meanwhile, iodized o i l capsules will be used to meet urgent goiter outbreaks in “hotspot” areas, and there i s

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also the option o f providing iodized salt packets to l o w income households through other programs such as the PSNP.

Addressing Vitamin A DeJciency

High coverage o f Vi tamin A capsules to children aged 6-59 months has been achieved through the EOS program. Sub-component I d i s planning to facilitate transition o f EOS activities to the HEP, uti l izing HEWs, VCHPs, and using locally determined community health days. There i s some evidence that the popular appeal and understanding o f the Vi tamin A component o f EOS i s far less than with the deworming component. This i s common in many countries, and this sub- component will accordingly cover increased advocacy in this regard.

Addressing Iron Deficiency Anemia

Improving i ron and folate tablet supply i s a priority need in efforts to decrease i ron deficiency anemia (IA). This sub-component seeks to assure a constant supply o f i ron and folate tablets to a l l HEWS for provision to pregnant women. This action will take place through antenatal care visits as wel l as through outreach visits by the HEWs in collaboration with their VCHPs. The program will also incorporate systematic efforts to promote nutrition and care for adolescent girls. This will involve not only counseling but also weekly i ron supplementation both for girls enrolled in secondary school and those not. Pilot studies are planned to examine alternative means o f reaching non-school attending girls.

Zinc Supplementation in Cases of Diarrhea

The project’s and N N P ’ s interest in zinc relates to i t s proven effectiveness in decreasing the severity and duration o f diarrhea in children and, possibly, i t s effectiveness in reducing child stunting. Priority actions involve government registration o f zinc as an essential drug and inclusion in the essential drug package for HEWs. Zinc21, provided with ORS to children with diarrhea has been accepted as part o f the HEP and should be initiated once zinc i s registered. NNP will work closely with other partners on food fortification efforts and with private sector partners who may be particularly useful in the production o f Sprinkles-type products.

Component 2: Institutional and Knowledge Base Strengthening

Sub-Component 2(a): Strengthening Human Resources and Capacity Building

This sub component will support: (i) coordination mechanisms for nutrit ion at different levels; (ii) institutional capacity building for implementing units and activities at different levels o f Government (including human resources strengthening); and (iii) training and capacity building o f research and training institutions.

Sub-Component 2 (b): Advocacy, Social Mobilization and Program Communication

N N P ’ s success in achieving i t s objectives will require a wel l functioning communications strategy. Such a strategy will be geared in part to enlist the active participation o f a large number o f stakeholders at different levels, to raise consciousness o f the importance o f the problems being

At present there i s a charge for ORS in health centers. ORS also i s commercialized under the brand name “Lem lem.” The optimal regimen for diarrhea treatment i s ORS sachets for two days followed by crushable zinc tablets for 7 to 14 days.

21

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addressed and the current efforts underway in the country to address them. At the same time, priority behavioral change messages will be identified and systematically incorporated into the communications systems functioning in the health sector and in other sectors. The major activities include:

1. T o generate ownership o f the country’s nutrition agenda by government and non-government decision makers, stakeholders and the public at large

- H o l d individual meetings and group discussions with these key stakeholders to articulate clearly the nutritional problems facing the country and the means by which these problems are being addressed systematically in the NNP. Suggestions and cooperation will be actively solicited. Carry out national and regional events (sometimes as part o f government identified “National Days”) Sponsor discussion forums targeted at the country’s professional communities Submit NNP-related newspaper articles and journal articles Enlist or purchase other media time Organize visits (for groups o f stakeholders and from service providers f rom others geographic areas) to NNP woredas demonstrating best practices

-

- - - -

2. To identify the highest priority nutrition messages in need o f dissemination and the constraints and resistance points presently limiting changes in practices

- Systematically review existing nutrition messages being utilized by the government and by NGOs and the success o f these messages in changing behaviours, and identify those which should receive priority status within NNP Systematically pre-test a l l messages which have not undergone such pre-testing previously H o l d a workshop with key NNP stakeholders to review findings from the above activities, and reach consensus on priority nu t i t i on messages to be disseminated in the NNP

-

-

3. T o incorporate these messages systematically into the communications channels and materials o f the health sector and o f other sectors

- Review existing health sector communication strategies, channels, messages and materials and identify specific opportunities for including the priority nutrition messages Examine opportunities to incorporate the priority messages into the communications strategies o f other sectors and into educational curricula (working closely with the linkage activities described in 2(d) below Review educational curricula to incorporate key nutrit ion messages and actions in primary schools (both for school going and non-school going children) and into DNagricul tural vocational training institutes Print nutrit ion B C C materials and counseling aids based on the priority messages and distribute to HEWs and VCHPs/model households

-

-

-

4. To strengthen the capacity o f HEWs and VCHPs/model households to promote appropriate caring practices among care providers, communities and service providers to improve nutrit ion o f children, adolescents and women, and to complement these efforts with B C C messages in other media.

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- Purchase air time and transmit nutrition radio programs via national, regional and community radio stations HEWs and VCHPs/model households form and facilitate nutrition Community Radio Listening groups Training o f HEWS and VCHPs/model households on nutrit ion BCChegotiation ski l ls with special attention to the constraints and resistance points limiting adoption o f these practices Training o f HEWs and VCHPs/model households on organizing and facilitating C B N community conversations

- Nutrit ion community conversations conducted during CBN sessions - Organize annual community festivals to celebrate achievements in CBN - Recognize model VCHPs/model households, kebeles/HEWs and woredas through

community festivals and other means - Develop print materials (Family Health Card with a growth monitoring and

promotion chart, poster and leaflets) and counseling aids for individual and group counseling The behavioral change sk i l ls o f fkont l ine workers (HEWs, VCHPs/model households and Das) will be strengthened in relation to the priority nutrition messages being disseminated

-

-

-

-

Sub-Component 2 (e): Strengthening Nutrition Information/Suweillance (SNIAS), Monitoring and Evaluation and Operations Research

The amount o f data needed for monitoring the nutrition situation, i.e., information for planning and managing nutrition service delivery and program i s vast and includes service-based data (health facility or community including disease/malnutrition surveillance data), early warning data, surveillance (sentinel) sites, emergency assessments, surveys, operational research and other data inputs. For this reason, sub-component 2 (c) o f NNP will redefine the information needindicators and mechanisms for data collection, analysis and use by way o f strengthening the existing Health Management Information SystedIntegrated Disease Surveillance and Response (HMISDDSR), Demographic Surveillance Sites (DSS) as wel l as the functions undertaken by the Emergency Nutrit ion Coordination Units (ENCU) which are part o f the Early Warning System (EWS). I t wi l l strengthen the abil ity o f the existing system to provide appropriate data to enable proper nutritional surveillance, addressing gaps in this regard in the existing system. In addition, this sub-component wi l l undertake overall M&E for the NNP and wil l also cover relevant operational research for the NNP.

The activities to be undertaken include those related to emergency nutrition situations. These include coordination o f emergency nutrition information and assessments, coordination o f emergency nutrition response, emergency nutrition information management and analysis (including database), follow-up o f the impact/performance o f emergency nutrit ion interventions, and coordination o f operational research on the data linkages between the EOS and the EWS. These activities would be implemented by the ENCUs, which are part o f the EWS, given the current government structure.

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Sub-Component 2 (d): Strengthening Multi-sectoral Nutrition Linkages

This sub-component o f the NNP addresses in particular the inter-sectoral nature o f nutrition, i.e. the fact that i t i s affected by a range o f different interventions in different sectors. The sub- component aims to strengthen the linkages to other relevant programs and sectors, with the overall goal being to enhance the nutritional impact o f programmatic activity in these sectors, and thus to combat malnutrition through a multi-sectoral approach.

Whi le there are many valuable linkage possibilities, the NNP has decided to init ially concentrate o n linkages between the NNP and five other categories o f programs/projects, as shown in Table A10-1. These are under discussion with the programs and sectors involved.

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Table A10-1. Key Linkages Planned With NNP Linkages with the Productive Safety Net Program (PSNP) and the Food Security Project (FSP) Ensure that the young children and the pregnant and lactating women in families receiving a id are being

1 nutrit ionallv monitored Uti l ize contact points as opportunities for nutrit ion BCC counseling (on breast feeding and complementary feeding practices, on optimal pregnancy practices and on iodized salt) and for i ron and folate distribution to pregnant women Include nutrit ional status (nutritional anthropometry) and food security score in the evaluation o f the PSNP and FSP Linkages with the Water, Sanitation and Hygiene (WASH) Program Ensure that the young children and the pregnant and lactating women in families receiving W A S H assistance are being targeted for nutrit ional services. W A S H volunteers, HEWS and VCHPs should interact closely to permit extension services which are

I benefited f r o m extended longevity

In addition to the above, inter-sectoral coordination mechanisms, addressing both policy and technical aspects, wi l l be set up as part o f the NNP as detailed in Annex 6.

The design o f this sub-component i s ongoing (particularly the HIV/AIDS aspects), and the costing may be modified accordingly. W h i l e the various agencies under the FMOH, RHBs and WOHOs will work to implement the above linkages, other agencies under other ministries will need to play a vital role as well. The NNP wil l provide funding to other agencies (under other ministries) to support their role.

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11. Implementation of NNP

The lead agency for the NNP i s the FMOH, as designated by the government o f Ethiopia. Within FMOH, the main units that wi l l take charge o f implementation will be the Nutrit ion Unit under the Family Health Department; the Health Extension and Education Center; the Health Management Information System unit; and the Ethiopian Health and Nutrit ion Research Institute (EHNRI). Within the health sector, a key role will be played by the RHBs and the WOHOs .

But given the multi-sectoral nature o f nutrition, the role o f ministries and agencies outside the health sector i s vital. As mandated by the N N S which has now been officially approved, agencies outside the health sector with key nutrition-related interventions will also play a key implementing role in the NNP. This includes, at the federal level, the Disaster Prevention and Preparedness Agency (DPPA); the Ministry o f Agriculture and Rural Development (including the Food Security Bureau); the Ministry o f Education; and the Ministry o f Water Resources. The equivalent bodies at the regional and woreda levels wi l l also implement key NNP activities. The role o f DPPA and the equivalent at the regional and woreda levels will be key in order to implement the TSF program which i s a key part o f the NNP. K e y services in the areas o f nutritional information and coordination o f emergency nutrition responses will be provided as part o f the NNP by the Emergency Nutr i t ion Coordination Units at the federal and regional levels, under the DPPA and i t s regional equivalents. The following table specifies the implementation responsibilities for the NNP:

lementary Food (EOS OS into the Health

Education, Ministry o f Water Resources, and equivalents in a l l cases at regional and woreda

otes: 1. FMOH = Federal Ministry o f Health; RHBs = Regional Bureaus of Health; WOHOs = woreda Health Offices; HMIS = Health Management Information Systems unit (under FMOH); HEEC = Health Extension and Education Centre (under FMOH); IDSR = Integrated Disease Surveillance and Response unit (under FMOH); EHNRI = Ethiopian Health and Nutrition Research Institute (under FMOH); DPPNDPPBsiDPPOs = Disaster Prevention and Preparedness AgencyiBureaudOffices; ENCU = Emergency Nutrition and Coordination Unit (under DPPNDPPBs).

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111. Institutional Arrangements for NNP Regarding Health Sector at Federal Level

Malnutrit ion needs to be addressed in a multi-sectoral manner, as has been stressed in various places in this document. However, the government has given the health sector overall responsibility for the NNP. This section therefore focuses on the institutional arrangements regarding the health sector at the federal level in implementation and overall management o f the NNP.

Given i t s critical role in addressing malnutrition in Ethiopia, there are presently two entities dedicated to nutrition within the health sector at the federal level. One i s the Nutrit ion Unit (NU) o f the Family Health Department (FHD) o f FMOH, and the other i s the Nutrit ion Research Department (NRD) o f the Ethiopian Health and Nutrit ion Research Institute (EHNRI). Both will be centrally involved in the implementation o f the proposed IDA project, as wel l as the NNP, working in close collaboration with the Health Extension and Education Center (HEEC) under FMOH which i s responsible for training o f HEWS.

Figure A10-1 shows the relationships between the departments o f the FMOH. The NU i s the youngest o f the four FHD units. I t was created as a result o f a series o f Health Sector Development Programme reviews and recommendations. The NU currently has four regular full- time staf f a team leader and three nutrition experts. These are currently supplemented by one full-time nutrit ion staff hired by UNICEF and seconded to the NU o f the FMOH. F M O H units typically rely on the Planning and Programming Department (PPD) for the preparation and monitoring o f donor projects funds. But i t i s the technical experts of the implementing department that identify, negotiate and draft the project, and submit it to the PPD according to PPD procedures and formats. The individual departments are also responsible for the implementation o f the projects, and supplying the PPD with the information i t needs to follow up on the project.

For the purposes o f preparation o f the proposed IDA project as wel l as the NNP, a Program Preparation Team (PPT) was set up, and housed at the NU. This team consists o f three full-time consultants, and has been in place for about six months.

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Figure A10-1: Federal Ministry o f Health Organogram

Pharmaceutical Administration and SuDDlv Service

Minister

Audit

Organization & Management Service

Administration and Finance Service ~

-

I Women’s Affair Department

Elderly Care Nutrition

2 Nutrition Experts

Maternal/ Adolescent Child Health 1 Team Leader Health

Disease Prevention & Control Department

Figure A10-2 focuses o n EHNRI, which i s an autonomous organization with i t s own financial and auditing departments. The NRD o f EHNRI has substantially more full-time regular staff than the NU, including 10 senior researchers and 10 junior staff. Since it i s autonomous, EHNRI i s responsible for the approval and monitoring o f i t s own projects; the PPD o f FMOH i s not involved in this area.

The NNP will rely o n this government structure throughout i t s implementation. However, with the ratification o f the N N S and the development and approval o f the NNP, the GOE has made a commitment to fill critical gaps in the structure by hiring full-time staff in the medium to longer run as needed, and to f i l l these gaps via targeted technical assistance in the shorter run, paid for largely by the proposed IDA project as wel l as Development Partners (DPs). This includes PPT members; in the shorter run, i t i s planned that at least two members o f the present PPT will stay on for the implementation phase.

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Figure A10-2: Ethiopian Health and Nutrition Research Institute Organogram

Planning/Programming

I Board of Directors I

Audit

Public Relations

I Social

Nutrit ion

I Clinical

Nutrit ion

I Food Science and Dietetics

I Deputy Director I

- 4 senior 3 junior researchers

- 3 senior 2 junior researchers

- 3 senior 5 junior researchers

1 I

The development o f the necessary full-time regular structure in the medium to longer run i s one o f the topics being addressed during the business process re-engineering (BPR) which i s currently taking place, with the HR-BPR (Human Resources-BPR) team o f the FMOH taking the lead in this area. The structure will be adapted to fit the l i s t o f identified core functions in Table A10-3. It i s even possible that the new structure will include the elevation o f the NU to the level o f a full department within the FMOH.

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Ta Function Category

Function Category I Leading the Nutrition Coordinating Body at all levels

Function Category I1 Planning, programming, coordinating

Manuals, standards, etc. Training

Developing

Function Category I11 Data management and analysis Surveys and evaluation of NNP

Research Operations

le A10-3. Categories o f Core NNP Functions Activities

- - -

Draft agenda and issues for the meeting o f the Nutr i t ion Coordinating Body; Advise the Nutr i t ion Coordinating Body; Report biannually to the Nutr i t ion Coordinating Body o n implementation, finance and achievement o f the N N P

Prepare routine plans and projects including budget p lan and tracking Leads and organizes coordination o f the NNP within the ministry and in other l i n e min is t r ies or sectors Prepare contracts and Terms o f Reference Review and redesign programs Supervision and technical support t o other u n i t s o f FMOH and other sectors Prepare project documents f r o m the NNP Prepare P I M for donors

Provide technical input into planning and implementation o f programs Develop policy, legislation, technical guidelines, procedures and norms Enforce strategy, and legislations Undertake HRD needs assessment and specify the necessary organizational structure and staffing in line with NNP Prepare training guideline, manuals, standards and materials Manage, supervise and undertake training at a l l levels Monitor the quality o f trainings Prepare report for the review/supervision mission Integrate routine nutrit ion data into HMIS , Compile, analyze, and disseminate the nutr i t ion data Provide feedback to implementers and pol icy makers for decision making and reprogramming Capacity bui lding at different levels Development o f norms, standards and quality control procedures for the data collection, management and analysis Provide analysis useful to policymakers to decide where and h o w to target interventions (food, health, water, etc.) Undertake national and small scale surveys Conduct Baseline, M id te rm and Final evaluation Interpret and reconcile the several different data

Proposed Staffing Structure The composition o f this body at different levels i s shown in the N N P Program Implementation Manual; FMOH will be the Secretariat o f the body. These activities are to be undertaken mainly by the Federal Nutr i t ion Unit and HEEC as well as the Nutr i t ion Units or equivalent at the regional level (under the Regional Health Bureaus). The proposed staffing structure at this

includes one nutritionist and one training expert with nutr i t ion background. I t has also been proposed that there should be four professionals for regional support based on a need basis.

These functions are to be mainly undertaken by H M I S and EHNRILDSR. However, to support data management and analysis as wel l as guiding surveys, one M&E expert wil l be required as part o f the proposed structure.

22 The proposed staffing structure i s at the Federal level and i s in addition to the existing Nutr i t ion Unit staff.

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Function Category I V Surveillance, and response to nutrition emergency

Function Category V

Advocacy and social Mobil ization

Function Category V I Procurement of Goods, Services and Consultants

items f rom different sources - Merge data f rom different sources, matching codes

as needed (given that coding systems and woreda boundaries differ between different sources o f data and across time) Triangulate different sources o f data so that one can use facil i ty level data to provide trends o f population- or community-level indicators Provide analysis o n the impacts o f different interventions and different factors o n nutr i t ion indicators

- House different data sources and studies on nutrit ion (including dataistudies f r o m different localized government, donor and NGO programs), and analyze accordingly Coordination o f emergency nutr i t ion information,

-

-

assessments Coordination o f emergency nutr i t ion response Conduct quality control o f nutr i t ion data and information ( f rom nutr i t ion surveys and EOS screening) Emergency nutr i t ion information management and analysis including data base Fol low up o f performances o f emergency nutrit ion interventions based o n Sphere standards and national emergency intervention guidelines Capacity strengthening o f Early Warning Department and Partners at federal and regional levels (training o n S M A R T programme, quality control, standards) Supervision, provision o f technical support and follow-up o f implementation o f planned activities for regional ENCUs in SNNPR, Oromia, Tigray, Amhara and Somali regions Coordinate operational research on EOSiEWS linkages Produce and disseminate emergency Nutr i t ion bul let in on quarterly basis

strategy, channels, messages and materials and develop a revised communication strategy Organize nutr i t ion events, discussion forums Coordinate and supervise nutrit ion radio programs and publications Advocate the N N P for donors support Advocate for support overseas f rom donors and private organizations in US, Japan, etc. Facilitate the formation o f Community Radio Listening Group by HEW and VCHPs Training o f EHWs and VCHPs on organizing and facilitating Community Conversation session Identify l i s t o f commodities and prepare specification Prepare bidTOR for procurement o f goods and services (Shopping, NCB, ICB)

- Review existing healtldnutrit ion communication

- -

- -

-

-

- -

These functions would be undertaken by the ENCUs which are currently under DPPA/DPPBs, although there may some rearrangement as a result o f the g o v e m e n t B P R currently under way

These functions are to be mainly undertaken by H E E C in collaboration with the Nutr i t ion Unit. However, one additional communication specialist i s required as part o f the proposed structure to support the NNP.

T w o procurement specialists are to be recruitedassigned for PFSA and EHNRI,

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Func t ion Category

F inancia l VI1

Management

Func t i on Category VI11

L inkage with other sectors and uni ts o f M i n i s t r y

- Follow-up o f the procurement and logistics

Moni tor f l ow o f funds Fol low up o n account opening and closure Timely SOE Prepare financial reports every quarter Prepare reportlupdate for every mission

Perform internal auditing Prepare documents for external auditing

Follow-up with a l l implementing agenciesiorganizationsidepartments regarding fund release, uti l ization and t imely reports, etc.

- -

Prepare an MOU and liaise with other ministries Supportive supervision and follow-up o f activities undertaken by other ministries and u n i t s o f the ministry which are relevant t o N N P Coordinate meetings and jo in t planningireviews with other sectors Help coordinate with other agencies’ funding going to interventions in N N P sectors other than health (e.g. Agriculture Extension Workers) Develop, monitor and follow-up o n linkages with other programsisectors Monitor and suggest nutrition-relevant indicators for other related projects Broaden N N P M&E and Results Framework to incorporate indicators relevant to other programsisectors

-

-

-

-

-

before effectiveness, to strengthen the present structure o f the FMOH and EHNRI procurement systems. A Financial Management specialist for the project (and the NNP) i s to be recruitedassigned before effectiveness, to strengthen the present structure o f the FMOH and EHNRI finance departments. These functions are to be coordinated undertaken by the National Nutr i t ion Coordinating Body and the Nutr i t ion Unit

IV. Cost and Financing of National Nutrition Program

Detailed costing o f the NNP has been undertaken. The estimated costs at the time o f writing are summarized in Table A10-4, for the f i r s t five-year phase o f NNP (July 2008 to June 2013). The estimated cost o f NNP without Targeted Supplementary Food (TSF) and without HIV-related nutrition interventions i s $205 mi l l ion over the five years, excluding the total government contribution which i s estimated at $96 mil l ion. The five-year cost o f TSF i s $1 13 mi l l ion.

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Components

1. STRENGTHENING NUTRITION SERVICE DELIVERY

l a . EOSITSF and EOS Transitioning into H E P

l b Management o f Severe Malnutr i t ion

1 c. Communitv-Based Nutr i t ion

Government Total Financing Total Financing Contribution Requirement f r o m Requirement f rom (Salaries, Pre-Service Development Development Partnersl Training and Partners1 Without With TSF Included (US$ Operational Cost, TSF (US$ millions) mill ions) etc.) (US$ mill ions)

$176 $289 $67

$63 $176 $8

$32 $32 $25

$6223 $62 $3 1

Notes: 1. Includes IDA. 2. The operational cost o f delivering Vi tamin A has been included under Sub-Component l a in this table.

1 d. Micronutrient Interventions 1 2. I N S T I T U T I O N A L AND KNOWLEDGE B A S E STRENGTHENING 2a. Capacity Building, Program Implementation

2b. Communication and advocacy

Surveillance and Operations Research 2c. Nutr i t ional Information System,

2d. Strengthening Inter-sectoral Nutr i t ion

The above costs are the latest figures at the time o f writing. The NNP will shortly be officially approved and adopted by the government, and some changes may be made to the costing and framework o f the NNP in the interim. In particular, discussions are under way as to whether HIV-related nutrition interventions should be incorporated in the NNP in a different manner f rom what i s reflected above. Even after official approval and adoption, the NNP framework (including the costing) will be modified by the government as needed if new information comes in (e.g. f rom the results o f the NNP operational research), or after jo in t reviews. Joint reviews for the NNP (involving the government and development partners) will be conducted twice a year before the Midterm Review o f the first five-year phase o f the NNP, and annually afterwards.

$19 $19 $3

$29 $29 $30

$17 $17 $19

$2 $2 $5

$8 $8 $3

One important reason for adopting this type o f flexible approach i s that the NNP will be conducted in a knowledge-based manner, with a strong focus o n conducting relevant operational research, much o f i t financed by the proposed IDA project. N e w methods or new types o f interventions may be introduced at scale in response to promising operational research results.

23 The Training cost o f CBN i s included under capacity building. The cost o f CBN also includes management o f 90 % o f severely malnourished children for the last two years o f the NNP.

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In addition, very crucially, the “Strengthening Inter-sectoral Linkages” sub-component will be developed further, focusing on non-health sector interventions. Accordingly, the costing for this critical sub-component will l ikely be modified. A detailed framework for implementation arrangement/modalities will also be developed.

Strong interest has been shown by development partners in the NNP, especially after the official approval o f the N N S in February 2008, in a high-profile ceremony presided over by the Deputy Prime Minister and Minister for Agriculture and Rural Development H.E. At0 Adissu Legesse, as wel l as the Minister for Health H.E. Dr. Tedros Adhanom and the Director-General o f the DPPA, A to Simon Machale. This interest i s coming not just from donor partners that are already committed to supporting nutrition interventions in Ethiopia, but also - especially - from new donors.

This interest i s being reinforced by a renewed interest in the development community (including the Wor ld Bank) in nutrition, labeled as the “forgotten MDG”. A number o f donor partners overseas have shown strong interest in starting or scaling up programs supporting nutritional interventions in countries which fulfill a number o f requirements, especially: (i) suffering f rom a high malnutrition burden; and (ii) showing strong commitment to large-scale efforts to combat malnutrition. With the approval o f the N N S and the development o f the NNP, Ethiopia - which has for a long time has manifested high rates of malnutrition - i s wel l placed to qualify for large amounts o f support f rom these development partners.

Partly for these reasons, Ethiopia was one o f only five developing countries chosen for the launch o f the recent Lancetz4 series highlighting nutrition and nutritional interventions. This launch was supported by the Bill & Melinda Gates Foundation, which i s scaling up i t s support for nutrition interventions in developing countries.

Especially since the approval o f the N N S occurred only very recently, some time will be needed for the interest f rom various donor partners to be concretized, and for approvals to be obtained. The Wor ld Bank i s well placed to play a leadership role in coordinating this process, and in ensuring harmonization o f the various contributions within the framework o f the NNP. Ongoing discussions have been taking place along these lines. Several o f the potential donor contributors to the NNP have stated a preference for contributing using Multi-Donor Trust Funds (MDTFs) administered by the Bank, and one or more MDTFs will thus be set up. At the same time, other donor partners would use parallel financing arrangements.

T o date, the donors that are already committed to supporting nutrition interventions in Ethiopia, and that have already obtained approval f rom their headquarters in this regard (or are close to obtaining approval) are UNICEF, the Wor ld Food Program (WFP), Micronutrient Initiative (MI), the Government o f Japan (including a contribution f rom the Japan International Cooperation Agency), U S A I D and the Wor ld Health Organization (WHO). Some o f these NNP partners are considering scaling up their contributions. Several other donor partners have been involved in the discussions and are l ikely NNP contributors, but their potential commitments cannot be stated publicly at this stage. However, once their commitments are crystallized, they will be reflected in calculations o f the NNP costing and financing gaps. Updated figures will be provided on a regular basis, especially just after the NNP jo in t reviews.

24 This i s a well-known medical journal.

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UNICEF’s financial support for the nutrition program i s already agreed with the government under their approved Country Program Act ion Plan (CPAP) for 2007-20 1 1. A similar statement also applies to WFP. Although these UN agencies will be using parallel fiduciary mechanisms as agreed under the CPAP, programmatically a l l NNP activities will come under one planning and coordination mechanism.

The selection o f the activities to be funded by the proposed IDA project were based largely on the consideration o f the need for some startup funding for critical “ready-to-go” activities that will underpin the development and evolution o f the NNP over the next f ive years, while delivering some expected “quick wins”. The chosen m i x o f activities i s a combination of: (i) interventions with high expected returns relative to costs (community-based nutrit ion and micronutrient interventions); and (ii) institutional strengthening and capacity building activities which would l ikely take a longer time to bear fruit but are critical to the medium- and long-term success o f the broader NNP.

As additional funding comes in f rom other development partners or through additional IDA resources, these would build on the base established by the present IDA project, also taking into account the activities to be funded f i o m other donor commitments. As shown in the analysis o f Annex 9, these additional resources would be funding activities that have very high benefit-to- cost ratios.

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Annex 12: Safeguard Policy Issues Ethiopia: Nutrit ion Project

There are n o potential negative impacts f rom this project and therefore the environmental category rating i s “C”.

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Annex 13: Project Preparation and Supervision Ethiopia: Nutrit ion Project

Planned Actual P C N review 09/27/2007 09/27/2007 In i t ia l P I D to P IC 1010212007 1010212007 In i t ia l ISDS to P I C 10/03/2007 1010312007 Appraisal 01/28/2008 0212612008 Negotiations 03/17/2008 03/17/2008 B o a r d R V P approval 04/29/2008 Planned date o f effectiveness 07/08/2008 Planned date o f mid-term review 01/07/2011 Planned closing date 0 1/07/20 14

Key institutions responsible for preparation o f the project: -Government: Ministry o f Health, Ministry o f Finance and Economic Development -Development Partners: UNICEF, WFP, Micronutrient Initiative

Bank staff and consultants who worked o n the project included: Name Tit le Unit

Andrew Sunil Rajkumar Economist, TTL AFTH3 Mar i to Garcia Lead HD Economist AFTH3 Endeshaw Tadesse Senior Operations Off icer AFTH3 Samuel Hai le Selassie Senior Procurement Specialist AFTPC Richard Olowo Senior Procurement Specialist AFTPC

AFTPC Abiy Admassu Temechew Procurement Analyst Mu la t Negash Tegegn Consultant FM Specialist AFTFM Tafesse Freminatos Abrham Financial Management Specialist AFTFM Teklehaimanot M o l l a Consultant FM Specialist AFTH3 Mar ie Khoury Consultant FM Specialist L O A F C Luis M. Schwarz Senior Finance Off icer L O A F C Jonathan Pavluk Senior Counsel LEGAF Ngozichukwu Njemanze ET Consultant Lawyer L:EGCF Nadeem Mohammad Senior Operations Off icer AFTHV Arianna Legovini Senior Economist AFTRL Basma Ammar i ET Consultant AFTRL Norbert Mugwagwa Operations Adviser AFTHD Surendra K. Agarwal Operations Adviser AFTQK Soheyla Mahrnoudi Operations Officer AFTRL Nevena Alexieva Operations Officer AFTRL Cecile Ramsay Operations Advisor A F T Q K Southsavy V. Nakhavanit Program Assistant AFTH3 Eleni Albejo Team Assistant AFC06 Chie Ingvoldstad Consultant AFTH3

Bank funds expended to date on project preparation: 1. Bank resources: US$50,000 2. Trust funds: US$O 3. Total: US$50,000

Estimated Approval and Supervision costs: 1. Remaining costs to approval: us$10,000 2. Estimated annual supervision cost: us$80,000

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Annex 14: Documents in the Project File Ethiopia: Nutrition Project

1. 2. 3.

4.

5. 6. 7. 8.

9.

FMOH, Program Implementation Manual for NNP, Draft Report, March 3,2008 UNICEF, Country Programme Action Plan, 2007-20 1 1 World Bank, Ethiopia: Plan for Building on Progress A Plan for Accelerated and Sustained Development to End Poverty, September 2006 World Bank, Economic and Sector Work, Malnutrition in Ethiopia: Current Interventions, Successes, Cost-BeneJit Analysis, and the Way Forward, Draft Report, December 2007 World Bank, Aide-mCmoire: Pre-Appraisal mission, October 8-3 1, 2007 World Bank, Project Concept Note September 27,2007 World Bank, Aide-mCmoire: Identification mission, May 1-30, 2007 FMOH, National Protocol for the Management o f Severe Acute Malnutrition, March 2007 GOE, Plan for Accelerated and Sustained Development to End Poverty (PASDEP, 2005- 2010), 2006

10. Central Statistical Authority (Ethiopia) & ORC Macro, Ethiopia Demographic and Health Survey 2005. Addis Ababa, Ethiopia and Calverton, Maryland, U.S.A. 2006

1 1. Ethiopian PROFILES Team & AED/Linkages, Why Nutrition Matters. PowerPoint presentation on the Ethiopian PROFILES analysis. Addis Ababa: AED/Linkages 2005

12. World Bank, Well-Being and Poverty in Ethiopia: The Role of Agriculture and Agency, July 2005

13. Ethiopia Welfare Monitoring System Report 2004 14. Central Statistical Authority. The 1994 Population and Housing Census o f Ethiopia,

Addis Ababa, 1998 15. EOS/TSF Technical Working Group, Strategy Paper - Enhanced Outreach

Strategy/Targeted Supplementary Food Programme - 2007-1 0 and Beyond, 2007 16. FMOH, Health Sector Development Plan (HSDP) I11 2005/06-2009/10, Draft Report,

2005 17. FMOH, National Strategy for Child Survival in Ethiopia, 2005 18. World Bank, Guidelines: Procurement Under IBRD Loans and IDA Credits, May 2004

19. World Bank, Guidelines: Selection and Employment o f Consultants by World Bank (Revised October 2006)

Borrowers, May 2004 (Revised October 2006)

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Annex 16: Country at a Glance Ethiopia: Nutr i t ion Project

Ethiopia a t a glance 1/28/08

Key Development Indicators

(2006)

Population. mid-year (millions) Surface area (thousand sq km) Population growth (Oh) Urban population (% of total population)

GNI (Atlas method, US$ billions) GNI per capita (Atlas method, US$) GNI per capita (PPP. international $)

GDP growth ( O h ) GDP per capita growth (Oh)

(most recent estimate, 2000-2006)

Poverty headcount ratio at $1 a day (PPP. %) Poverty headcount ratio at $2 a day (PPP, %) Life expectancy at birth (years) Infant mortality (per 1,000 live births) Child malnutrition (% of children under 5)

Adult literacy. male (Yo of ages 15 and older) Adult literacy. female (% of ages 15 and older) Gross pnmary enrollment, male (Oh of age group) Gross pnmary enrollment, female (Oh of age group)

Access to an improved water source (% of population) Access to improved sanitation facilities (Oh of population)

Ethiopia

72.7 1,104

2.0 17

14.3 200

1,190

10.9 8.6

78 43 80 38

50 23 99 84

36

Sub- Saharan

Africa

770 24,265

2.3 36

648 842

2,032

5.6 3.2

41 72 47 96 29

69 50 98 86

56 37

Low income

2,403 29,215

1.8 30

1,562 650

2,698

8.0 6.1

59 75

72 50

108 96

75 38

Net Aid Flows

(US$ miNions) Net ODA and official aid Top 3 donors (in 2005)

United States Italy United Kingdom

Aid (Oh of GNI) Aid per capita (US$)

Long-Term Economic Trends

Consumer prices (annual % change) GDP implicit deflator (annual % change)

Exchange rate (annual average, local per US$) Terms of trade index (2000 = 100)

Population. mid-year (millions) GDP (US$ millions)

Agnculture industry

Services

Household final consumption expenditure General gov't final consumption expenditure Gross capital formation

Exports of goods and services Imports of goods and services Gross savings

Manufactunng

1980

21 1

19 7 4

3.4 6

12.5 4.3

2.1 131

37.7 7,269

60.3 10.5 4.9

29.2

80.0 9.8

14.5

7.6 11.9 10.8

1990 2000

1,009 688

50 130 169 26 35 11

8.4 8.5 20 11

5.2 6.2 3.3 6.9

2.1 8.1 151 100

51.2 64.3 12,083 8,180

(% of GDP) 54.0 49.4 11.1 12.2 4.8 5.5

34.9 38.4

77.2 73.8 13.2 17.9 12.9 20.3

5.6 12.0 8.8 23.9

11.9 16.2

2006 '

1,937

825 87 75

15.8 27

12.3 11.6

8.7 79

72.7 15,166

47.5 12.6 4.5

39.9

86.4 12.1 24.2

13.8 36.5 15.1

Age distrlbutlon, 2006

Femle

I 2o ' O percent O ' O 2c

Jnder-5 mortality rate (per 1,000)

250 1 2w

150

IO0

50

0 I990 1995 2000 2005

0 Ethiopia USubSaharan Ahica

Growth of GDP and GDP per caplta (Ye) Iz0 T

15 10

5 0

5

-10

90 85 00 05

GDP per capita I +GDP -

1980-90 1990-2000 2000-06 (average annual growfh %)

3.1 2.3 2.0 2.2 4.5 6.7

0.8 3.8 5.1 3.2 4.6 8.7 2.9 4.0 5.5 4.3 5.3 7.5

1.2 3.4 8.4 4.0 9.0 0.4 4 9 6.5 8.0

3.2 7.0 13.9 3.2 5.8 13.0

Note: Figures in italics are for years other than those specified. 2006 data are preliminary .. indicates data are not available. a. Aid data are for 2005.

Development Economics, Development Data Group (DECDG).

- 100-

Ethiopia

Balance of Payments and Trade 2000 2006

(US$ millions) Total merchandise exports (fob) Total merchandise imports (cif) Net trade in goods and services

Current account balance as a % of GDP

466 1,000 1,611 4,592 -976 -3,443

-335 -1,366 -4.1 -9.1

Workers’ remittances and compensation of employees (receipts) 53 174

ReSeNeS, including gold 349 1,156

Central Government Finance

(“A of GDP) Current revenue (including grants)

Current expenditure

Overall surpiusldeficit

Highest marginal tax rate (%)

Tax revenue

Individual Corporate

15.7 16.0 9.5 10.6

20.6 11.6

-9.4 -6.3

35 30

External Debt and Resource Flows

(US$ mllllons) Total debt outstanding and disbursed 5,463 2,326 Total debt service 137 163 Debt relief (HIPC, MDRI) 2,264 1,383

Total debt (% of GDP) Total debt service (% of exports)

Foreign direct investment (net inflows) Portfolio equity (net inflows)

67.0 15.3 13.1 7.6

135 0 0

Composltlon of total external debt, 2006

Private Sector Development 2000 2006

Time required to start a business (days) - 16 Cost to start a business (% of GNI per capita) Time required to register property (days) - 43

- 45.9

Ranked as a major constraint to business (% of managers surveyed who agreed)

Tax rates 72.2 Tax administration 59.2

SiocK mamet cap taiizai on ( % of GDP) Ban6 capital to asset ratio (%)

IGovernancs Indicators, 2000 and 2006

Voice and accountability

Political stability

Regulatory quality

Rule of law

Control of corruption

0 25 50 75 I W

0 2006 Country’s percentile rank (0-100) 0 2000 higher values impiy bsner rallngs

Technology and Infrastructure 2000 2005

Paved roads (% of total) Fixed line and mobile phone

High technology exports subscribers (per 1,000 people)

(% of manufactured exports)

12.0 19.1

0.1 0.2

Environment

Agricultural land (%of land area) Forest area (% of land area) Nationally protected areas (% of land area)

Freshwater resources per capita (cu. meters) .. 1,712 Freshwater withdrawal (% of internal resources)

31 32

4.6

C02 emissions per capita (mt) 0.09 0.11

GDP per unit of energy use (2000 PPP $ per kg of oil equivalent) 2.8 2.9

Energy use per capita (kg of oil equivalent) 291 303

(US$ millions)

IBRD Total debt outstanding and disbursed Disbursements Principal repayments Interest payments

0 0 0 0 0 0 0 0

IDA Total debt outstanding and disbursed 1,779 553 Disbursements 137 95 Total debt service 34 39

IFC (fiscal year) Total disbursed and outstanding portfolio 0 0

of which IFC own account 0 0 Disbursements for iFC own account 0 0 Portfolio sales, prepayments and

repayments for IFC own account 0 0

Gross exposure - - New guarantees - -

MiGA

Note: Figures in italics are for years other than those specified. 2006 data are preliminary. 1/28/08 .. indicates data are not available. -indicates observation is not applicable.

Development Economics. Development Data Group (DECDG).

- 101 -

Annex 17: Map IBRD 33405 R1 Ethiopia: Nutrition Project

- 102-

Ras DashenRas DashenTerara (4620 m) Terara (4620 m)

E t h i o p i a nE t h i o p i a nP l a t e a uP l a t e a u

De

na

ki l D

es

er

t

Gr

ea

t

R

if

t

V

al l

ey

O g a d e nO g a d e n

T I G R AYT I G R AY

A FA RA FA RA M H A R AA M H A R A

S O M A L IS O M A L I

O R O M I YAO R O M I YAG A M B E L AG A M B E L A

DIRE DAWADIRE DAWA

SOUTHERN NATIONS,SOUTHERN NATIONS,NATIONALITESNATIONALITESAND PEOPLESAND PEOPLES

ADDIS ABABAADDIS ABABA

BENSHANGULBENSHANGUL

HARARIHARARI

Dinder

Tekeze

Atbara

Blue Nile

Aw

ash Akobo

Genale

Dawa

Baro

Abay

Hang

er

Didesa

W

abe Shebele

Ramis

Wabe G

estro Wabe Shebele

WeldiyaWeldiyaDebraDebraTaborTabor

AxumAxum

AdigratAdigrat

SodoSodo

NegeleNegele

MegaMega

ImiImi

DoloDoloOdoOdo

Degeh BurDegeh BurAwareAware

WarderWarder

DomoDomo

MoyaleMoyale

YavelloYavello

WendoWendo

ShashemeneShashemene

NazretNazret

WelkiteWelkite

HosainaHosainaBongaBonga

GimbiGimbiAwashAwash

DodolaDodola

HumeraHumera

Kebri DeharKebri Dehar

GonderGonder

DeseDese

DebreDebreMarkosMarkos

AselaAsela

GobaGoba

GoreGore

NekemteNekemte

JimaJima

HarerHarerDire DawaDire Dawa

Bahir DarBahir Dar

MekeleMekele

GambelaGambela

AwasaAwasa

AsosaAsosa

AsayitaAsayita

JijigaJijigaADDISADDISABABAABABA

SUDANSUDAN

ERITREAERITREA

SOMALIASOMALIA

UGANDAUGANDA KENYAKENYA

DJIBDJIB

REP.REP.OFOF

YEMENYEMEN

To To KerenKeren

To To GedarefGedaref

To To MarsabitMarsabit

To To WajirWajir To To

MogadishuMogadishu

To To MogadishuMogadishu

To To HargeysaHargeysa

WeldiyaDebraTabor

Axum

Adigrat

Sodo

Negele

Mega

Imi

DoloOdo

Degeh BurAware

Warder

Domo

Ferfer

Moyale

Yavello

Wendo

Shashemene

Nazret

Welkite

HosainaBonga

GimbiAwash

Dodola

Humera

Kebri Dehar

Gonder

Dese

DebreMarkos

Asela

Goba

Gore

Nekemte

Jima

HarerDire Dawa

Bahir Dar

Mekele

Gambela

Awasa

Asosa

Asayita

JijigaADDISABABA

T I G R AY

A FA RA M H A R A

S O M A L I

O R O M I YAG A M B E L A

DIRE DAWA

SOUTHERN NATIONS,NATIONALITESAND PEOPLES

ADDIS ABABA

BENSHANGUL

HARARI

SUDAN

ERITREA

SOMALIA

UGANDA KENYA

DJIBOUTI

REP.OF

YEMEN

Dinder

Tekeze

Atbara

Blue Nile

Aw

ash Akobo

Genale

Dawa

Baro

Abay

Hang

er

Didesa

W

abe Shebele

Ramis

Wabe G

estro Wabe Shebele

INDIANOCEAN

LakeTana

LakeTurkana

R e d S e a

G u l f o f A d e n

To Keren

To Gedaref

To Marsabit

To Wajir To

Mogadishu

To Mogadishu

To Hargeysa

E t h i o p i a nP l a t e a u

De

na

ki l D

es

er

t

Gr

ea

t

R

if

t

V

al l

ey

O g a d e n

Ras DashenTerara (4620 m)

14°N

36°E 40°E 44°E

46°E 48°E

42°E32°E

34°E 36°E 38°E 40°E 44°E 46°E 48°E42°E32°E

12°N

14°N

12°N

10°N

8°N

6°N

4°N

10°N

8°N

6°N

4°N

ETHIOPIA

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World BankGroup, any judgment on the legal status of any territory, or anyendorsement or acceptance of such boundaries.

0 50 100 150

0 50 100 150 Miles

200 Kilometers

IBRD 33405 R1

JUN

E 2007

ETHIOPIASELECTED CITIES AND TOWNS

REGION CAPITALS

NATIONAL CAPITAL

RIVERS

MAIN ROADS

RAILROADS

REGION BOUNDARIES

INTERNATIONAL BOUNDARIES