Document of

The World Bank

Report No: 22287-IND

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED CREDIT

IN THE AMOUNT OF SDR3.27 EQUIVALENT(US$4.15 MILLION)

TO THE

REPUBLIC OF INDONESIA

FOR A

LIBRARY DEVELOPMENT PROJECT - LIL

JUNE 7, 2001

Environment and Social Development Sector UnitEast Asia and Pacific Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective May 22, 2001)

Currency Unit = Rupiah (Rp.)Rp.1 = US$0.0001

US$1 = Rp.9.600

FISCAL YEAR2002 -- 2005

ABBREVIATIONS AND ACRONYMSCLT -- Community Library TeamCPMU -- Central project management UnitDL -- District LibraryDLT -- District Library TeamEAP -- East Asia PacificGAAP -- Generally Accepted Accounting PrinciplesGOI -- Government of IndonesiaIDA -- International Development AgencyKPKN -- Government' s Treasury OfficeLGOM -- Library Grant Operation ManualMOF -- Ministry of FinanceNGO -- Non Government organizationNTB -- West Nusa Tenggara BaratPMM -- Project Management ManualPMR -- Project Management ReportPPIU -- Provincial project Management UnitSA -- Special AccountSD/MI -- Primary schoolsSLT -- School Library TeamSOE -- Statement of ExpendituresSPM -- Request for Payment

Vice President: Jemal-ud-din KassumCountry Director: Mark Baird

Sector Manager/Director: Zafer EcevitTask Team Leader: Susiana Iskandar

INDONESIALIBRARY DEVELOPMENT PROJECT

CONTENTS

A. Project Development Objective Page

1. Project development objective 22. Key performance indicators 2

B. Strategic Context

1. Sector-related Country Assistance Strategy (CAS) goal supported by the project 22. Main sector issues and Government strategy 23. Learning and development issues to be addressed by the project 34. Learning and innovation expectations 4

C. Project Description Summary

1. Project components 52. Institutional and implementation arrangements 53. Monitoring and evaluation arrangements 6

D. Project Rationale(This section is not to be completed in a LIL PAD)

E. Summary Project Analysis

1. Economic 72. Financial 83. Technical 84. Institutional 85. Environmental 96. Social 97. Safeguard Policies 10

F. Sustainability and Risks

1. Sustainability 102. Critical risks 113. Possible controversial aspects 12

G. Main Credit Conditions

1. Effectiveness Condition 122. OtherNegotiation Conditions 13

H. Readiness for Implementation 13

1. Compliance with Bank Policies 13

Annexes

Annex 1: Project Design Summary 14Annex 2: Detailed Project Description 18Annex 3: Estimated Project Costs 22Annex 4: Cost Benefit Analysis Summary, or Cost-Effectiveness Analysis Summary 23Annex 5: Financial Summary for Revenue-Earning Project Entities, or Financial Summary 24Annex 6: Procurement and Disbursement Arrangements 25Annex 7: Project Processing Schedule 51Annex 8: Documents in the Project File 52Annex 9: Statement of Loans and Credits 53Annex 10: Country at a Glance 57

MAP(S)

INDONESIA

LIBRARY DEVELOPMENT PROJECT

Project Appraisal Document

East Asia and Pacific RegionEACIF

Date: May 22,2001 Team Leader: Susiana IskandarCountry Manager/Director: Mark Baird Sector Manager/Director: Zafer EcevitProject ID: P068949 Sector(s): EY - Other EducationLending Instrument: Learning and Innovation Loan (LIL) Theme(s):

Poverty Targeted Intervention: N

Program Financing Data[ ] Loan [X] Credit [ ] Grant [ ]Guarantee [ 3 Other:

For LoanslCreditslOthers:Amount (US$m): US $4.15 million

Proposed Terms (IDA): Standard Credit lFinancing Plan (US$m): Source Local Foreign TotalBORROWER 0.38 0.00 0.38IDA 4.15 0.00 4.15

Total: 4.52 0.00 4.52

Borrower: GOVERNMENT OF INDONESIAResponsible agency: THE NATIONAL LIBRARYAddress: JI. Salemba Raya, Jakarta, IndonesiaContact Person: Mr. HemandonoTel: 62-21-3101411 Fax: Email:

Contact Person: Mr. Rahmat NatadjumenaTel: 62-21-34830019 Fax: Email: marsela@indo.net.idEstimated disbursements ( Bank FY/US$m):

FY 2001 2002 1 2003 2004 1 2005Annual 0.00 1.25 1.52 1.06 0.32

Cumulative 0.00 1.25 2.77 3.83 4.15

Project implementation period: 3 yearsExpected effectiveness date: 08/01/2001 Expected closing date: 12/31/2004

OCS $0 Form Re. MVc 2O0

A. Project Development Objective

1. Project development objective: (see Annex 1)

* To develop innovative approaches to increase the use of reading materials in community libraries andSD libraries

* To motivate students and communities to use, enjoy and value books for recreational and informationalpurposes

* To develop a strategy for community and SD library support in the rest of the participating districts,involving local community support, NGO's and local government.

2. Key performance indicators: (see Annex 1)

* Students/community users demonstrate an increase in reading and wider use of library services.* Parliaments, government agencies and donors increase and provide financial and other support to small

libraries.* Other small libraries start to be established or are resurrected.

B. Strategic Context1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex 1)Document number: R2001-0001(IDA/R2001-0003:IFC/R2001-0002)Date of latest CAS discussion: 0 1/30/2001

"Delivering Better Public Service to the Poor. "The overriding objective of decentralization is to bringthe government closer to the people. This enhances local government transparency and accountability aswell as community participation"(para 51) and "The Bank will continue to help empower communities sothat poor everywhere have an opportunity" (para 55).

2. Main sector issues and Government strategy:

Limited use of information in daily life. Increasingly, as daily life becomes more complex, even in ruralareas, reliance on traditional wisdom and knowledge is insufficient. Knowledge of farming techniques, pestcontrol, birth control, disease prevention and cure, and marketing information is now gathered fromtraditional sources and existing wisdom by many people. To gain additional knowledge, however, and tomove to more advanced levels, people need to develop new habits of information gathering, relying moreheavily on printed materials, and on expert sources of information, with skills that should includeapproaching leaming as an interactive, live-long activity, with reading at its core, to acquire information aspart of daily life. These skills are insufficiently developed right now, especially in rural areas.

A publishing industry that has not realized its potentiaL Indonesia possesses a substantial and healthypublishing industry, with a number of large publishers, mostly in Java, who have distribution reachesthroughout the country. School textbooks fonn the largest part of the publishing business, with theremaining titles on sale focusing mainly on the urban, middle-class market. There is also substantialpublishing of religious texts, and especially in the urban areas and with the recent increased freedom of thepress, a vibrant market in newspapers and magazines. Because of the almost nonexistent book purchasingpower of rural and poorer segments of the community, there are almost no books serving thesecommunities. Bookstores exist in most urban areas, but there is very limited access to a good selection ofexisting book titles in all but the largest urban areas. Most bookstores have extremely limited stocks,mostly concentrating on textbooks and related school items (dictionaries, atlases, wallcharts), religioustexts and pulp literature. Bookstores or stalls, can be found in most towns, but of a very rudimentary

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nature, providing testimony to the existing reach of distributors and interests of the population, but alsoindicating the limits of penetration of those books that do exist.

A national public library system exists. A network of provincial public libraries, under the managementof the national library, has been active in providing library services to the public. Provincial libraries aregenerally housed in adequate buildings with significant and appropriate collections; they are well attended.In several provinces, the provincial library has been active in developing district-level libraries which serveas true community and public libraries, with active programs and reading promotion activities. Whilepromising, these initiatives are very limited, because of the limited budgets, although the enthusiasm anddedication of the staff is encouraging.

Limited resources in grassroots libraries. A limited number of grassroots, community initiatives forsmall libraries and book collections can be found in all provinces. These libraries operate largely withvolunteer effort and almost no budgets, and serve small groups of constituents. They can be found inmosques and other places of worship, and are often associated with conmnunity efforts such as youthgroups and farmers' extension groups. While remarkable for their dedication and initiative, these effortsare limited, with extremely small donated book collections and only a limited number of useful titles. Theyshow the limits of what is possible with almost no resources and little training. The challenge will be tobuild on the existing initiatives to make them more effective and to develop a strategy to provide long-ternfinancial support.

Centralized school library supply policy. Number of primary schools with effective libraries is verylimited. In most cases, the schools have only very limited selection, inattractive to students. In general,library book supply policies -- provided by projects -- were detennined centrally and thus took littleaccount of the varied needs of different schools in different localities. It was notable that, in most of theschools librarians and class teachers had little idea as to which titles were most popular with the students.It seems likely that their lack of interest stemmed, in part at least, from the fact that they took little if anypart in deciding which library books should be ordered for their school. The challenge will be to shift theresponsibility for determining library needs down to school and community level, at least the school-clusterlevel. A teacher forum should provide opportunities for teachers to share experience concerning librarybook usage and to agree on approaches to book selection and ordering.

3. Learning and Development issues to be addressed by the project:

The project would build on local initiatives to develop capacity at the lowest levels. The existinginitiatives in some areas show a basic level of dedication and commitment to the importance of books andof the provision of information, although at a limited level. The project would use this existing reservoir,and support those locations that already have shown an interest. With this approach, stakeholderinvolvement is hoped to be high, by supporting those communities that have shown an interest; it is alsoexpected that there will be a greater degree of sustainability resulting from the investments.

The project design will focus on ensuring that community input is maximized at different stages. Theplans for community participation include: (a) assessment and decisions on rules regarding the use andoperation of the library; (b) input into the book selection process, providing information on generalcategories of subjects and specific titles to purchase; (c) decisions on outreach programs fordifficult-to-reach parts of the population (the poor, the old, ensure women's participation, children, andpeople living in more remote parts of the community); (d) inclusion of regular meetings to encouragesharing of experiences and local learning between project beneficiaries.

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Support would be in the form of block grants to give maximum flexibility to each library. Rather thanproviding top-down inputs, with the problems of appropriateness and one-size-fits-all, the project wouldprovide a grant, delivered in installments, to each of the libraries, for them to purchase inputs, depending onthe needs and local situation. Through this approach, the project will also deliver basic skills in planning,resource management and accounting to a group of people working at the grassroots level. It is expected tobuild also the necessary library and infon-nation services skills to provide simple but appropriate access toreading and information sources.

Supportfor a stronger library network, witlh long-term vertical support and expertise down to the locallevel. Although the national library network has been effective in its support and in further developingprovincial and district libraries, it has been constrained by limited resources. While it is important forsmall community and grassroots libraries to be able to manage themselves and address their needs flexibly,they nevertheless need to be linked and supported, especially from the technical side.

At the same time, the project will explore ways of introducing and maintaining these small libraries in away that will be sustainable over the long-term, without necessarily requiring constant infusion ofgovernment funds. This would include financing such libraries from charitable donations or fund-raisingefforts, exploring the possibility of providing tax incentives for people willing to dedicate time andresources, and working with local govermnent as well as the private sectors on awareness raising.

4. Learning and innovation expectations:

L Economic 1 Technical 1 Social 1 ParticipationD Financial 1 Institutional El Environmental O Other

Institutional and Technical Development. The project would provide financial support, technicalexpertise, and training to SD schools and grassroots libraries in the management of a small library and inproviding appropriate infonnation to these communities. In addition, the project would strengthen thevertical links with the district, provincial and national libraries; especially in the areas of training andmonitoring and evaluation.

Participatory Approaches. The block grants will be managed at the local level by the library team,including the people involved in managing the parent organization, the library managers, andrepresentatives of the user community. The continuation and strengthening of existing local arrangements(school committees, informal library management teams) will be encouraged, rather than the establishmentof new structures. In all cases, libraries will need to ensure that adequate representation and involvementfrom the community and users (including teachers and pupils) exists, and would be included in makingdecisions on book selection, procurement of other items such as furniture, library policies, and staffingresponsibilities. Information exchanges between libraries in the same area, to share experiences and to learnfrom each others activities would be encouraged. They will be encouraged to establish cluster-basedmeetings to enable a horizontal leaming network.

While the involvement of the provincial and district libraries will ensure appropriate technical skills andcapabilities, physical and social distance between provincial and kabupaten levels and communities issubstantial, an assurances have to be put in place that allow for adequate community responsiveness. Theproject will provide community facilitators for each library to carry out independent monitoring, troubleshooting, providing assistance to small libraries and providing feedback on problems to implementingagencies.

In addition, the Project will provide selected libraries with technical assistance to introduce innovativeactivities to significantly promote community and student reading habits.

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C. Project Description Summary

1. Project components (see Annex 2 for a detailed description and Annex 3 for a detailed costbreakdown):

The project will find appropriate and effective ways of supporting existing grassroots small libraries, thathave already been put in place by a few dedicated people or institutions and that provide reading materialsto the community around them. Primary schools that already have small libraries will also be included andimproved. The project emphasizes the long-term sustainability of such initiatives, by working with localcommunities and charities and with local government as well as the private sector, to find optimalconfigurations of support and self-initiative. The project will be implemented over a period of 3 years intotal 23 districts in 4 provinces: Central Java (10 districts), West Nusa Tenggara, NTB (7 districts), SouthSumatra (5 districts) and Bangka-Belitung (1 district). The project will cover total 770 small libraries: 25primary school libraries and 10 community libraries in each district. Each library will receive small blockgrants during the three project years, to purchase books and magazines, library materials, library furniture,modest remodeling and to support reading promotion activities. All activities will be supported byappropriate training and be accompanied by a monitoring and evaluation program, to ascertainsustainability and long-term expansion of the program.

Indicative Bank- % ofComponent Sector Costs % of financing Bank-

_(US$M Total (US$M) financingA. Grants to small libraries (School Other Education 2.46 54.4 2.46 63.1library, community library and districtlibraryB. Institutional Development Other Education 0.0 0.01. Strengthening Local Capacity to 1.34 29.6 1.20 30.8Develop School and Communitylibraries2. Project Management 0.72 15.9 0.24 6.2

Total Project Costs 4.52 100.0 3.90 100.0

Front-end fee 0.00 0.0 0.00 0.0Total Financing Required 4.52 100.0 3.90 100.0

2. Institutional and implementation arrangements:

Role of national, provincial and district libraries. The overall project management, monitoring andevaluation would be under the responsibility of the National Library, in which the Central ProjectManagement Unit (CPMU) is established. The CPMN will also responsible for the preparation of theprocedures and criteria for the selection of participating small libraries, development of the trainingmaterials for staff of the small libraries Training. At each project province, Provincial ProjectImplementation Unit (PPIU) have been established at Provincial Library. The PPIU, supported by DistrictLibraries (DL) will be responsible for identification and selection of participating libraries, provision oflibrary grants, carrying out the training, managing the book fairs, and assisting the libraries with bookselection and purchasing, and supervision of project implementation in the small libraries. The PPIUs andDL will work with local authorities, community leaders and with district authorities to develop a long-termmodel of grassroots libraries, relying largely on community contributions and local support.

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Role of Community in the management of the librariesOnce the eligible school library and community library have been identified, facilitator shall conduct ameeting at each eligible library to be attended by library manager and representatives of the usercommunity (i.e. teachers, students, and parents in case of school libraries, and community leaders in case ofthe community libraries). The purpose of the meeting is to inform the library manager and the usercommunity on the library grant scheme and procedures and for the community to elect the membership ofthe School Library Team (SLT) and Community Library Team (CLT). SLT and CLT membership shallreflect the balance of gender and user community. SLT and CLT will be responsible for the preparation ofthe proposal, and if the grant is awarded, it shall manage and control the use of library grant. SLT andCLT will open opportunities for the wide user-community to select books, magazines and other readingmaterial to be purchased for the library. SLT and CLT shall meet regularly, at least once a month, todiscuss ways to improve their library. Minutes of meetings and records of expenditures shall be put in theannouncement board for transparency and encourage greater ownership of the libraries by community.

3. Monitoring and evaluation arrangements:

Three types of monitoring will be done under the project.

* The first type will be performed by the province. The monitoring will start with a baseline surveyand data collected for all libraries as part of the process of selecting participating libraries. Thiswill be followed by random, on-the-spot surveys starting 3 months after the participating librariesreceive the first block grant. It was agreed that each province would draw up a monitoringschedule and would visit 10 sites per month. Over the life of the project, all libraries, includingthose in remote areas, will need to be inspected during monitoring visits; provincial library staffwill be thoroughly trained in carrying out their monitoring tasks. In conducting the monitoring,staff from provincial library will be assisted by district library.

- PPIUs will recruit NGOs, community-based organizations, and/or individuals to assist in thesuccessful implementation of this project. "Community facilitator", each responsible for about10-15 libraries and who would visit regularly to monitor activities, provide feedback to the districtand province, to assist where needed, including participating in the advocacy with local authorities.

* During the project, it is planned to carry out an evaluation study - in the middle and towards theend of the project, to determine project achievements and to develop a plan for large-scaleimplementation. The study will be contracted out and should focus on library use and impact inthe school and the community, the extent to which support and financing is available fromcommunity, local authority and other sources, and the implications, including long-term costimplications, of implementation over a longer period of time and with a much larger number oflibraries.

4. Financial Management and Disbursements

A financial management assessment is be carried out by a Bank Financial Management Officer before theappraisal of the project. During the pre-appraisal of the project it was found that the National Library asthe implementing agency (Central Project Management Unit / CPMU) has limited experience in managingdonor financed project. Therefore, the CPMU is subject to complete the agreed time based action plan (Attachment 6-7) to ensure that CPMU, PPIUs and DLs has sound financial management practice during

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the project implementation. This includes the adoptions of a Project Management Manual, Library GrantManual and provision of training to the CPMU, PPIUs, DLs and the participating libraries staff in therelevant project management aspects. Details of the financial management arrangements, disbursement,special account operations and audit arrangements will be provided in Annex 6.

The CPMU and PPIUs will be responsible for procurement and authorizations of expenditures under theircomponents. Each PPIU shall maintain separate sub-project accounts and CPMU shall consolidate themfor preparation of the project account. DLs shall be responsible for the purchases of their books and otherreading materials and making the arrangements for training of the small libraries, of which advances wouldbe provided by the PPIU to the DLs. The project, through PPIUs will provide library grants to smalllibraries, to be released in five trenches in five semesters. The grants will be channeled through the relevantTreasury Offices (KPKN) who shall make payments upon PPIU's request. The small libraries will open anaccount in local bank, into which the grant trenches will be transferred as the conditions met. The SLT andCLT, formed in the school libraries and community libraries, shall be responsible for uses of the grants andmaintain the accounts following the book-keeping format to be provided in the Library Grant OperationManual. The progress report of the participating libraries shall be put in the library's announcement boardto enable the readers community to exercise controls.

Government of Indonesia will establish a US dollars Special Account (SA) at the Bank Indonesia, under thename of Directorate General of Budget with an authorized ceiling at $500,000. The SA deposit initiallywill be limited to $250,000 until total disbursement reached $1 million. The SA's management isessentially under the responsibility of CPMU, who prepare request for replenishment of SA as required.The replenishment of the Special Account may be based on quarterly PMR only after the production ofPMR satisfactory to the Bank, otherwise traditional SOE and full documentation disbursement will beused.

Given to the small nature of the expenditures, disbursements will be made against statement of expenditures(SOEs) for library grants, training, goods, project management and individual consultants contract valuedbelow $50,000 equivalent each. Documentation for expenditures under the grants will be retained at theparticipating libraries, and docurnentation for expenditures under the PPIUs and CPMU would be retainedat their respective offices. These documents would be made available to auditors during the annual audit,and to the Bank upon request during the supervision mission. Other items would be disbursed with fulldocumentation.

The annual audit of the project accounts, including SA and SOEs, shall be furnished to the Bank no laterthan six months after the end of the government fiscal year. The format of project accounts and the termof reference for the annual audit have been agreed during appraisal. The National Library will appoint theauditor before the negotiation.

D. Project Rationale

[This section is not to be completed in a LIL PAD. Rationale should be implicit in paragraph B: 3.]

E. Summary Project Analysis (Detailed assessments are in the project file, see Annex 8)

1. Economic (see Annex 4):[For LIL, to the extent applicable]

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o Cost benefit NPV=US$ million; ERR = % (see Annex 4)o Cost effectiveness* Other (specify)

During project implementation, the sustainability implications for this investment will be investigated in astudy, focussing on impact and sustainability analysis.

2. Financial (see Annex 4 and Annex 5):NPV=US$ million; FRR = % (see Annex 4)[For LIL, to the extent applicable]

* Schools and community libraries will be provided with a block grant, released in five installments everysix months. Uses of grants would be based on a positive list of expenditure items. Library managerswill receive training in the grant operation procedures including accounting and resource management.Close monitoring of the appropriate use of the funds will be essential.

* Existing budgets for the national and provincial libraries are small. This project represents asubstantial increase of their development budget, with increased financial responsibility and skills thatneed to be acquired, for financial management and procurement.

* While a certain amount of learning on how to use the funds appropriately is to be expected, amonitoring program to ascertain that funds are used well will be put in place, with a clause fortermination of support for those libraries that do not provide an adequate level of service.

3. Technical:[For LIL, enter data if applicable or 'Not Applicable']

* The proposed primary school and community libraries have been managed by people who are nottrained librarians; and would require very basic skills in information management/ services. The projectwill provide training in these skills, with a focus on the management of a small library facility withemphasis on reader services.

* Because of the paucity of book stores in many of the areas where the small libraries are located, accessto a good selection of book titles to be purchase will be one of the main difficulties. Therefore that theproject will provide support by holding mini Book Fair at the district level, giving exposure to librarymanagers and users to a reasonable number of good books.

4. Institutional:

4.1 Executing agencies:

The National Library will be the executing agency, with implementing units in each of the three provincialoffices of the National Library. All institutions have no experience with Bank-financed or otherdonor-agency financed projects and will require substantial assistance at the beginning of the project.

4.2 Project management:

The project will require close cooperation between the national and regional libraries and a willingness toallow the small libraries to carry out their own management and make their own decisions. This representsa departure from the current top-down approach. The regional libraries will need to move from a focus ofimplementation, to one of providing assistance, training and monitoring.

4.3 Procurement issues:

Most of the project costs will be in the library grants. The use of the grants is governed by a positive list ofeligible expenditures, and some threshold for expenditure of each specific item. Libraries will need to keep

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records of their expenditures in an organized fashion, and will be monitored for compliance.

4.4 Financial management issues:

Library Grants Manual spells out the selection process and criteria for the participating libraries, theflow-of-funds mechanism and retrieval of the grants, and the use of the grants funds.

5. Environmental: Environmental Category: C (Not Required)5.1 Summarize the steps undertaken for environmental assessment and EMP preparation (includingconsultation and disclosure) and the significant issues and their treatment emerging from this analysis.

N/A

5.2 What are the main features of the EMP and are they adequate?

N/A

5.3 For Category A and B projects, timeline and status of EA:Date of receipt of final draft:

N/A5.4 How have stakeholders been consulted at the stage of (a) environmental screening and (b) draft EAreport on the environmental impacts and proposed environment management plan? Describe mechanismsof consultation that were used and which groups were consulted?

N/A

5.5 What mechanisms have been established to monitor and evaluate the impact of the project on theenvironment? Do the indicators reflect the objectives and results of the EMP?

N/A

6. Social:6.1 Summarize key social issues relevant to the project objectives, and specify the project's socialdevelopment outcomes.

- The library team should represent an adequate cross-section of community leadership which supportthe community library. They should participate in: (a) assessment and identification of communitylibrary needs; (b) decisions on book selection and procurement; (c) decisions on rules of use andoperation of the library, including outreach activities to difficult-to-reach groups; and (d) sharing ofideas and lessons leamed with other communities.

* Community facilitators at grassroots level and consultants at provincial level would be involved inensuring that the role of the community is taken seriously, and to help in bringing in the communitiesand in setting up the consultation process.

6.2 Participatory Approach: How are key stakeholders participating in the project?

* For the primary school libraries, beneficiaries will be the students and teachers. In each school, alibrary committee, which represent the beneficiary groups, will be responsible for guiding themanagement of the library, including the selection of the books. Teachers will be heavily involved inbook selection.

* For the community libraries, beneficiaries will be the people from the community and from the groupsthat are involved with the community activities (religious organizations, youth groups, farmers' groups,etc.). For each library, a library team which represent the beneficiary groups will provide inputs andoversight to the library's management and book selection.

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* Overall, the beneficiary libraries that are involved in the project will benefit from this new bottom-upapproach.

6.3 How does the project involve consultations or collaboration with NGOs or other civil societyorganizations?

* There are two ways in which NGO could involve in this project. First, local NGO and/or consultantswill be hired to work with a number of libraries to introduce 'innovative' approaches aimed atimproving reading habit. Secondly, NGO and community-based organizations will be involved as"community facilitators" who will be responsible for monitoring, feedback and providing assistancewhere needed. They will ensure that the community needs are adequately addressed and promote theuse of the library in the community, ensuring that marginal groups are not left out, and that thecommunity is aware of the services.

6.4 What institutional arrangements have been provided to ensure the project achieves its socialdevelopment outcomes?

* Provinces and districts will need to ensure, in their selection of the libraries, that library management ishandled by the community and involves representation of the user community.

* In the middle and towards the end of the project, impact and sustainability evaluation will be carriedout, to ascertain the long-term viability of the libraries and their usefulness to the society.

6.5 How will the project monitor performance in terms of social development outcomes?

Commurity involvement and participation for sustainability will be measured as follows: (i) there is anincrease in participation and support from the community to the library; and (ii) local governments areallocating increased budgets to libraries during the project.

7. Safeguard Policies:7.1 Do an of the following safeguard policies apply to the pro ect?

Policy ApplicabilityEnvironmental Assessment (OP 4.01, BP 4.01, GP 4.01) 0 Yes 0 NoNatural habitats (OP 4.04, BP 4.04, GP 4.04) 0 Yes * NoForestry (OP 4.36, GP 4.36) 0 Yes * NoPest Management (OP 4.09) 0 Yes * NoCultural Property (OPN 11.03) 0 Yes * NoIndigenous Peoples (OD 4.20) 0 Yes * NoInvoluntary Resettlement (OD 4.30) 0 Yes * NoSafety of Dams (OP 4.37, BP 4.37) 0 Yes * NoProjects in International Waters (OP 7.50, BP 7.50, GP 7.50) 0 Yes * NoProjects in Disputed Areas (OP 7.60, BP 7.60, GP 7.60) 0 Yes * No

7.2 Describe provisions made by the project to ensure compliance with applicable safeguard policies.

N/A

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F. Sustainability and Risks

1. Sustainability:

This section is not to be completed in LIL PAD.

2. Critical Risks (reflecting the failure of critical assumptions found in the fourth column of Annex 1):

Risk Risk Rating | Risk Mitigation MeasureFrom Outputs to ObjectiveThe conununity library will not be M Membership of Library committees willintegrated into community activities. represent a cross-section of community/school

leadership which actively support the library.Training for library managers will emphasizehow to develop and implement effective readerservices and outreach activities.

Use of library resources will not be M Training materials for school library team willintegrated into classroom teaching and include the use of library resources to supportlearning because teachers will not change classroom teaching and learning.their teaching methods.School library will not be used by M Library staff will be given training in bookteachers and students because the selection and acquisition procedures. The librarymaterials are inappropriate, unattractive, committee will provide input into the selection ofor choice of book titles is limited. books to be purchased for the library. A book

fair mechanism will be designed to insure that awide variety of good books will be available forselection and purchase.

Project model will not be appropriate for M An impact evaluation study will be performed inlarge-scale replication. the third year of the project to ascertain if the

project can be logistically and cost-effectivelyreplicated on a large-scale basis.

The local government does not take up S Indication of sufficient support from locallessons learned from the project to government towards project objectives be useddevelop a strategy for community and as a criteria in the selection of participatingprimary school library support in the rest districts.of the country. This is because library hasnot been a priority of the local Local government personnel are included ingovernment. Moreover, the national project coordination meeting and other selectedlibrary as the project executing agency activities.has neither institutional nor functionalrelationship with the local government.Community, private institution and local M An innovative approach will be introduced togovernment will not respond to the selected libraries in selected districts to promoteinitiatives both reading habits and community, private

organization, and local government participationin the library development.

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The project will end up in delivering M Some initiatives will be introduced: (a) Thebooks and training but fail to promote a training curriculum for community leader,reading culture school heads and librarian will include

techniques on promoting reading habits; (b)Reading habit competitions; and (c) HiringNGOs to introduce innovative approaches topromoting reading habits.

From Components to OutputsSuitable primary school libraries are not M The selection process will use baseline surveysselected for the project. and site visits to make the final selection of

libraries to be included in the project. Site visitsSuitable community libraries are not will be carried out by provincial and districtselected for the project. library staff, accompanied by a provincial

consultant. Provincial and district librarystaff will be trained in carrying out fieldsurveys.

Library staff will receive inappropriate M The training program will be very practical andtraining. specifically designed to meet the needs of library

managers who run very small libraries.Purchasing access to a good selection of M The project will support holding book fairs atbook titles will be one of the main the district level so library managers and usersdifficulties because of the paucity of book can be exposed to good books. Library staffstores in many of the areas where the are given training in book/subscription selectionsmall libraries will be located. and acquisition procedures.Funds will be misused. M Library managers will receive basic skills

training in planning, resource management andaccounting to effectively use grants. Libraryteam will be actively involved in managementoversight. A monitoring program -- coordinatedby Project Management Consultants at CPMUand PPIUs -- to ascertain that funds areappropriately used will be designed andimplemented. Regional library staff will betrained in project monitoring. Training Plan forlibrary managers and team will be agreed at thenegotiation. Status report of the use of thegrants will be posted in announcement boardboth in each library and other local public space.

Overall Risk Rating M

Risk Rating - H (High Risk), S (Substantial Risk), M (Modest Risk), N(Negligible or Low Risk)

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3. Possible Controversial Aspects:

NA

G. Main Credit Conditions

1. Effectiveness Condition

Issuance of Project Management Manual and Library Grant Manual.Selection process of Project Management Consultant and Procurement-Financial Management Consultanthas been completed.

2. Other [classify according to covenant types used in the Legal Agreements.]

Negotiation Conditions* Decrees on establishment of CPMU and PPIUs and appointment of the staff* Draft Project Management Manual* Draft Library Grant Manual* Training plan for community and school librarian, district library and PPIU staff on Library Grant

Manual* Letter to Auditor (agreed during appraisal) confirming the audit arrangements* TOR for Project Management Manual training acceptable to the Bank3 Letter of expression of the participating District Libraries concerning agreement and readiness to assist

with the Project Implementation

Dated CovenantSigning of contracts for Project Management and Procurement-Financial Management Consultant shall notbe later than July 3 1, 2001 .)

H. Readiness for Implementation

O 1. a) The engineering design documents for the first year's activities are complete and ready for the startof project implementation.

O 1. b) Not applicable.

O 2. The procurement documents for the first six months' activities are complete and ready for the start ofproject implementation; and a framework has been established for agreement on standard biddingdocuments that will be used for ongoing procurement throughout the life of LIL

1 3. The LIL's Implementation Plan has been appraised and found to be realistic and of satisfactoryquality.

1 4. The following items are lacking and are discussed under loan conditions (Section G):

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I. Compliance with Bank Policies

0 1. This project complies with all applicable Bank policies.O 2. The following exceptions to Bank policies are recommended for approval. The project complies with

all other applicable Bank policies.

Susiana Iskandar Zafer Ecevit Mark BairdTeam Leader Sector Manager/Director Country Manager/Director

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Annex 1: Project Design Summary

INDONESIA: LIBRARY DEVELOPMENT PROJECTKey Perfonnance

Hierarchy of Objectives Indicators Monitoring & Evaluation Critical AssumptionsSector-related CAS Goal: Sector Indicators: Sector/ country reports: (from Goal to Bank Mission)Delivering better public * Country educationservices to the Poor sector reports

Follow-on DevelopmentObjective:To improve learning for * Value and relevance of * Impact evaluation study Teachers support and adoptchildren and adults community/school teaching methods which

libraries as perceived by approach learning as anchildren, teachers and interactive, live-long activity,members of the with reading at its core.community

Project Development Outcome I Impact Project reports: (from Objective to Goal)Objective: Indicators:To develop innovative * Use of primary school * Impact evaluation study * Use of library resourcesapproaches to increasing the library resources is is integrated intouse of reading materials in integrated into classroom teaching.community libraries and SD classroom teaching andlibraries students use SD

resources forrecreational readingoutside school and takematerials home

To motivate students and * Use of community * Impact evaluation study * Outreach activities willcommunity to use, enjoy and library is integrated into be emphasized in thevalue books for recreational community activities training program forand informational purposes as library managers.part of their naturaldevelopment, and to increasetheir use of SD andcommunity library servicesTo develop a strategy for * Students/ community * Impact evaluation study * Parliaments and govt.community and SD library users demonstrate agencies providesupport in the participating increase in reading and financial supportdistricts. wider use of library

services* Improvements made in * Impact evaluation study * Comnunity /school

primary school and administrations providecommunity libraries are financial and/or othersustainable after the types of supportproject is completed

* Dissemination to * Impact evaluation studynon-project sites

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: X ; f:~Key intfranel70 ; 0 ;; :fHierarchy of bjeies Key Per frmance *M tog A& Evaluation CriboAssumptions

Output from each Output Indicators: Project reports: (from Outputs to Objective)Component:Usage of library increases Community libraries: Library managers employ

* Number of books Library records outreach activities tochecked out increases by motivate students and20% on average per year community to use books forper district and per recreational and informationalprovince purposes

* Number of people visits Library records The project libraries will haveincreases by 20% on purchasing access to goodaverage per year, per selection of book titles.district and per province

School libraries:* At least 75% of teachers Library records

regularly check outbooks by the end of theproject Library records

* Number of booksreadlchecked outincreases by 25% onaverage per year perschool

Appropriate library Community libraries:management * Opening hours at least 3 Supervision reports Library managers receive

hours/day, 6 hours/week basic training in accountingfor all libraries and resource management.

* Clean, orderly library, Supervision reportsvariety of collection andstaffed adequately

School libraries:* Opening hours at least 4 Supervision reports

hours during schooldays (50% during and50% outside class hours)

* In multi-school Supervision reportslibraries: all schoolsparticipate equally

* Clean, orderly library, Supervision reportsvariety of collection andstaffed adequately

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User representation reflects Community libraries:client group * Substantial Library records

representation byage/gender within clientgroup

School libraries: Library records* Students reading/

checking out books areequally represented bygrade and gender

Community involvement and Community libraries: Library managementparticipation for sustainability * Increase in participation Monitoring program represent a cross-section of

(labor, books, money) community/school leadershipfrom community to which actively support thelibrary library.

* New libraries are being Monitoring programestablished in districtsduring the project bycommunity and localgovernment

* Local governments are Monitoring programallocating increasedbudgets during theproject

School libraries:* Student participation in Supervision reports

library operations* Community actively Monitoring program

involved andparticipating in libraryoperations

Provincial and district library Provincial and district Monitoring program If libraries fail to provide ainstitutional capacity is government increase technical worthwhile service, supportincreased and financial support to will not be forthcoming.

non-project libraries

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K_y PerformanceHierarchy of Objectives lndicatos Mnitring & Ealuation Critical Assumptions

Project Components / Inputs: (budget for each Project reports: (from Components toSub-components: component) Outputs)A. Grants to primary school 2.46and community libraries:

B. Institutional Development1. Strengthening Community 1.34Capacity2. Project Management 0.60

Honoraria for project staffamounting USD 0.12 to befunded from counterpartbudget.

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Annex 2: Detailed Project Description

INDONESIA: LIBRARY DEVELOPMENT PROJECT

By Component:

Project Component I - US$2.46 millionGrants to small libraries

Participating libraries. The project will be implemented over a 3 year period in a total 23 districts locations(primary school and village community libraries) in 4 provinces: Central Java (10 districts), West NusaTenggara, NTB (7 districts), South Sumatera (5 districts), and Bangka-Belitung (1 district). The projectwill cover total 770 small libraries: 25 primary school libraries and 10 community libraries in each district.

Selection. Participating libraries will be selected based upon submission of interest from community andschool libraries preceded by a widespread announcement of the availability of these funds. Interestedlibraries will be asked to fill in questioners. In each district, a committee, with balanced membershipbetween representatives of relevant local bureaucrats and private and community-based organization, willbe appointed by head of district (Bupati/Walikota) to be function as selection committee. Based on thereturned questioners, the committee will identify a number of qualified libraries to be verified bycommunity facilitators. The committee will then propose the best 25 primary school libraries and 10community libraries to Provincial Project Implementation Unit (PPIU). The verified data of the selectedlibraries will be used as baseline data.

Criteria for selection. In order to participate, primary school libraries shall have an active schoolcommittee, a staff / teacher who is in charge of the library, sufficient numbers of students to be a viableexample (minimum number would be 100 students for Central Java and 60 students for NTB, SouthSumatera and Bangka-Belitung), sufficient class teachers to adequately teach the students, a library cornerwith at last 9 square meters with minimum collection of 40 titles (non-textbooks), the library should havebeen actively utilized by the students and clear indication of the school head commitment to library use andmaintenance. For several schools located on one site and having connected playing areas, only one of theprimary schools in the complex would receive the support for the library based on above criteria - but willserve the other adjacent schools.

Selection of community libraries will be based on the following criteria: The libraries should have a formalorganization, specific target readers (for example, farmer groups, youth groups, religious groups, womengroups), two staff with minimum junior secondary education, a library room of at last 9 square meters,minimum collection of 40 titles (non-textbooks), a clear indication that the library should have beenactively utilized by the community for at least one year, and indication of local community and authoritysupport (such as availability of small fund and other in-kind support to maintain the libraries).

Each library will receive small block grant - paid twice yearly - during the three project years. Communitylibraries will receive initial grant Rp. 6 million with six-monthly follow up grants of Rp. 4.5 million for theremainder of the project. Initial grant will be Rp. 5 million for single-school library and Rp. 7 million formultiple-school library, with follow up grants of Rp. 3.5 million and Rp. 5.5 million respectively every sixmonths. For total amount received per library, see Table 1. The initial grant will be provided in the firstsemester of 2002 to all selected libraries upon completion of conditions for the contract agreement betweenthe libraries and the PPMU. The subsequent payments will be provided on performance basis. Paymentmechanism and conditions are to be detailed in the Library Grant Manual.

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Table I -- Grant per library

Amount received fIDR '000)Type of Year 2002 Year 2003 Year 2004 Total per

Libraries Smt. I Smt. 2 Smt. I Smt. 2 Smt. 1 library

Single school 5,000 3,500 3,500 3,500 3,500 19,000Multiple School 7,000 5,500 5,500 5,500 5,500 29,000

Community 6,000 4,500 4,500 4,500 4,500 24,000

Communities and schools will be heavily involved in the management of the library and the use of thegrant. The existing library team would be responsible for library management, augmented withrepresentation from the users. This team would meet regularly and make decisions on book selection,procurement of other items such as furniture, library policies, and staffing responsibilities. Library teamwould also meet, on a regular basis, with stakeholders from other community libraries in the same area, toshare experiences and to learn from each others activities.

Project Component 2 - US$2.06 millionInstitutional Development

A. Strengthening local capacity to develop schools and community in developing libraries - US$1.34millionMany of the activities will be new to the communities and school library managers; and to the district andprovincial libraries. The project will provide training and technical assistance for capacity building in theseactivities.

1. Training and workshops. A minimum of library skills will be needed for these libraries, with theemphasis on reader services, rather than on collection organization. Special training programs will bedesigned to help community and school libraries and will be delivered by a team of trainers consistingof expertise from the national library, national consultant and independent trainers. The training will begiven to staff of the provincial and district libraries, who will then be responsible for ensuring thatlibrary managers of the community and school libraries acquire the necessary set of minimum skills.Training curriculum will include techniques on promoting reading habits and community participation.Information dissemination activities. During the project, a series of public forum meetings will beheld, to advertise and make the project known to the media, NGO's and the general public. Thesemeetings will also be used for community libraries within the same area to meet with each other and toshare experiences and learn from each other.

2. Socialization for community, private institution, NGOs and local authorities. Annual meetings willbe held regularly for community, private institutions, NGOs, and local authorities to update them withthe status of the project and to seek for their participation and support for the sustainability of theparticipating libraries and possible adoption of the project approaches to other libraries.

3. Library innovation program. Selected libraries will be given additional inputs in the form of technicalassistance by specialist NGOs who will introduce new approaches to improve reading habits andcommunity participation in library operations. The impact of these additional inputs will be closelymonitored and evaluated for possible wider dissemination. At the same time a series of reading habitcompetitions (including short story writing) will be conducted for all libraries. The best manuscriptwill be compiled and published by CPMU.

4. Studies. Evaluation studies will be carried out during the third year of the project to determine project

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achievements and to develop a plan for large-scale implementation and recommendations forsustainability. The study should focus on library use and impact in the school and the community, theextent to which support and financing is available from different sources, the effectiveness of the grantsapproach, and the implications, including long-term cost implications, of implementation over a longerperiod of time and with a much larger number of libraries. Based on the findings and analysis, thestudies should also develop ways of introducing and maintaining these small libraries in a way that willbe sustainable over the long-term, without necessarily requiring constant infusion of government funds.This would include financing such libraries from charitable donations or fund-raising efforts, andworking with local government as well as private sectors on awareness raising.

5. Bookfor district libraries. District libraries are public libraries run and financed by participatingdistrict local government. The project will finance provision of books and other reading materials forsuch libraries. The budget provided is total Rp. 25 millions (Rp. 15 millions in first semester and Rp.1O millions in third semester of their participation). To provide the district librarian with access toinformation of books available in the market, they will be sent to Jakarta to attend annual national bookfair.

6. Book Fair. Because of the paucity of selection in most districts and rural areas, books fair will bemounted twice by each district libraries during the project life. The participating district libraries willdisplay books they purchased earlier and book catalogues. The book fair is intended to help theparticipating libraries in identifying and selecting books. The book fair will be organized at same timewhen the participating libraries follow the library training. Each district library will receive Rp. 5millions to organize the initial book fair (semester 1) and Rp. 3 millions for follow-up book fair(semester III) for each phase. It is expected that publishers will participate in the book fair.

7. Library Cluster Meeting. The participating libraries in each district will establish cluster meetings. Ineach district there will be one cluster of conmmunity libraries and two clusters of school libraries. Thelibrary team will meet regularly to share experiences. The community facilitators and district librarianwill occasionally join the meeting to provide some technical assistance.

8. Consultants. The CPMU will hire Project Management and Procurement-Financial Management, andTraining consultants. Each PPMU will hire a Project Management consultant. For supervision andmonitoring purpose, the PPMUs will employ 4 to 5 district-based community facilitators for eachdistrict which will be working under coordination of the Project Management consultant.

B. Project Management - US$0.72

1. Monitoring and Evaluation. Two types of monitoring will be done under the project.* The first type will be performed by the project management team and provincial library staff. The

monitoring will be aimed at assuring quality of the implementation of each components (grants andtraining activities). Some beneficiary libraries will be randomly selected for on-the-spot surveysstarting 3 months after the participating libraries receive the first block grant. All libraries,including those in remote areas, will need to be inspected during monitoring visits. Provincialproject management, who is also responsible for monitoring and evaluation, will thoroughlyprepare provincial and district library staff in carrying out their monitoring tasks.

* In each district, "Community facilitators", will be recruited to regularly visit the beneficiarylibraries. They will monitor activities, to assist where needed, including participating in theadvocacy with local authorities, and provide feedback to the district and provincial projectmanagement. They will work under coordination of the provincial monitoring consultant. Theywill receive extensive training on the project knowledge. They will be recruited individually(NGOs, volunteers and/or teachers) and will be paid on activity/visit-base, covering travelallowances.

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2. Operational Cost will cover recurrent cost for project management such as honorariurn for projectstaff, office supplies, travel allowances and utilities.

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Annex 3: Estimated Project CostsINDONESIA: LIBRARY DEVELOPMENT PROJECT

Note: Due to roundina, some figures suppressed to zeros.

_________~~~~~~~t tb%iO4US$m U$rmihion.,

A Grants to Small Libraries 1.71 0.00 1.71B. 1. Strengthening Capacity of School

and Community to develop library 0.97 0.00 0.972. Project Management 0.54 0.00 0.54

Total Base Cost 3.22 0.00 3.22

Physical Contingencies 0.48 0.48Price Contingencies 0.82 0.00 0.82

Total Project Cost 4.52 0.00 4.52

Total Financing Required 4.52 0.00 4.52

Local Foreign TotalProiect Cost by Category USS million US$ million US$ million

I Grants to Small Libraries 2.46 0.00 2.462 Goods 0.12 0.00 0.123 Technical Asistants 0.65 0.00 0.654 Training 0.57 0.00 0.575 Project Management 0.60 0.00 0.606 Honorarium (100% GOI funded) 0.12 0.00 0.12

Total Project Cost 4.52 0.00 4.52

Total Financing Required 4.52 0.00 4.52

Note: Due to rounding, some figures suppressed to zeros

I/Identifiable taxes and duties are 0 (USSm) and the total project cost, net of taxes, is 4.52 (US$m).Therefore, the project cost sharing ratio is 92% of total project cost net of taxes.

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Annex 4INDONESIA: LIBRARY DEVELOPMENT PROJECT

Impact and Sustainability Analysis

The main question to be answered is to investigate the sustainability implications for aninvestment such as this. This can only be done after the project has been in operation for a while.An impact and sustainability analysis, which would include an economic analysis but would gobeyond that in discussing a broader set of factors, will be carried out during the third year of theproject, with Terms of Reference prepared and approved by the Bank during the first year ofproject implementation.

The sustainability analysis would need to provide answers and evidence for the following:

* What set of services will keep the public as active users of the library.* What are the ranges of the costs of such services.* How can revenue be generated over the long run.* What would need to be the minimum contribution provided by government, to sustain the

viability of such initiatives. This would also need to look at and discussother-than-financial contributions, such as setting the right framework for allowing theseactivities to operate.

* What part of the contributions could usefully be provided by the community, and in kind.X What are the factors that would work against long-term viability of these libraries; and

how could they be mitigated. In other words, what would be the factors that would killsuch initiatives.

During project implementation, technical assistance will be provided, to develop ways ofintroducing and maintaining these small libraries, without requiring constant infusion ofgovernment funds. This would include financing such libraries from charitable donations orfund-raising efforts, exploring the possibility of providing tax incentives for people willing todedicate time and resources, and working with local government on awareness raising. thesustainability analysis will review these efforts, assess their impact, and give recommendations onfuture directions and activities.

The focus of the attention of the analysis will be to thoroughly review and discuss the impact ofthe library services provided on the community and on the school. To what extent has the librarybecome integrated into the lives of the people in the community; which section of the community;does it make a qualitative or quantitative difference in their lives. In the school, has the librarybecome a part of the curriculum and of the way teachers teach and children learn in school.

The analysis should also discuss and make recommendations on whether and how to expand andgo to scale with grassroots library activities. To what extent is initial pump-priming bygovernment necessary to get them started; what provides a basic, minimal environment for suchinitiatives to take off, in terms of commitment, skills and resources.

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Annex 5: Financial SummaryINDONESIA: LIBRARY DEVELOPMENT PROJECT

I IMPLEMENTATION PERIODTotal Financing Required Year 1 Year 2 Year 3 Year 4Project Cost

Investtnent cost 0.56 1.67 1.62 0.68Recurrent cost 0.00 0.00 0.00 0.00

Total project cost 0.56 1.67 1.62 0.68Total Financing Required 0.56 1.67 1.62 0.68

FinancingIBRD/IDA 0.48 1.54 1.50 0.65

GovernrmentCentral 0.08 0.13 0.12 0.03Provincial 0.00 0.00 0.00 0.00Co-financiers 0.00 0.00 0.00 0.00Users Fees/Beneficiaries 0.00 0.00 0.00 0.00Others 0.00 0.00 0.00 0.00

Total Financing Required 0.56 1.67 1.62 0.68

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Annex 6: Procurement and Disbursement ArrangementsINDONESIA: LIBRARY DEVELOPMENT PROJECT

Procurement

Procurement Assessment. The last CPAR conducted on Indonesia was in February 2000, and the FinalReport was issued in February 2001. The Assessment on agency's capacity to implement procurement wascarried out by Bank staff, and the Report was issued in March 2001, with the following outcome:

* The proposed implementing agencies do not have the adequate capacity to implement procurement andwill need to hire at least a person with procurement proficient as a procurement officer to support theproject for procurement management and to provide training.

* The clarifications on the agreed procedures to be followed for National Shopping will be included inthe Project Management Manual, to ensure consistencies with the Bank Procurement Guidelines.

* The Assessment also found that the overall procurement risk is high.

1. Guidelines. Procurement of works, goods, and related services funded wholly or partly by theWorld Bank shall follow the Guidelines for Procurement under IBRD Loans and IDA Credits datedJanuary 1995 and revised in January and August 1996, September 1997 and January 1999 (theProcurement Guidelines).Employment of consultants shall be based on the Guidelines for Selection and Employment of Consultantsby World Bank Borrowers of January 1997, revised in September 1997 and January 1999 (the ConsultantGuidelines)

2. Procurement Plan, Strategy, and Standard Documents. The Procurement Plan providing atimeline for each step of the procurement process has been prepared and will be updated annually. Eachupdate of procurement plan will require the Bank's prior no objection. The standard request forquotations/contracts (for works and goods), and the standard request for proposals (for selection ofconsultants) are attached tc the PIP and agreed with the Bank prior to negotiation. Since all consultingservices contracts are expected to be less than USD 200,000, the shortlist may comprise of entirely nationalconsultants, in which case, request for proposals in Bahasa Indonesia (acceptable to the Bank) will be used.This document is the translated version of the Bank's Standard Request for Proposals (SRFP).

3. Goods ,Equipment, and Printing Services (US$ 0.13 million equivalent, includingcontingencies).(a) Contracts for goods and equipment, procured by the National Library (PerpustakaanNasional/Perpusnas - CPMU) and Perpustakaan Nasional Propinsi (Perpusnasprop - PPIJ), to support theoperation of this project include: furniture, air conditions, computers and office equipment, are availableoff the shelf and expected to cost less than USD 50,000 equivalent per contract. These contracts will beprocured through national shopping procedures in accordance with paragraphs 3.5 and 3.6 of theProcurement Guidelines, i.e., written quotations obtained from at least three reputable suppliers on thebasis of a detailed description and quantity of goods, as well as the desired delivery time and place, and theaward will be made to the lowest priced responsive bid. The aggregate for this component is USD 70,000.

(b) Books and other reading materials for District Libraries (up to a maximum aggregate amount of USD67,000 equivalent) are proprietary and expected to cost less than USD 10,000 equivalent per contract.Titles of the books and other reading materials will be identified by the District Library Team through thefollowing activities:

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* Browsing the catalogue* Attending the book fair or other similar events* From list of books at bookstores.

Based on the above selected titles, each library will prepare a purchase plan. Such purchase would beconducted through the following options:

* Purchase from bookstores with verification of prices by comparing with the published price list by thepublishers.

* If such books are not available at the bookstores, then the respective library may have a direct contractwith publishers.

(c) Printing services: The winning titles of the reading habit competition described in paragraph 5.1 belowwill be printed following national shopping procedures.

4. Grants for School and Community Libraries (US $ 2.46 million equivalent, includingcontingencies). The use of the grant will be governed by a positive list, indicating what the money can bespent on. This list has been approved by the Bank, and is in Attachment 6-2 to this Annex. The applicableprocurement procedures under the Grants is described below and will be adopted in The Grant Manualacceptable to the Bank.

The availability of these grants will be announced in the national press, radio, and billboards. Allinterested libraries will be allowed to participate; a shortlist of libraries will be prepared, based on criteriaapproved by the Bank. Each of the shortlisted libraries will be visited by a monitoring team, to ensure theaccuracy of the data provided and to give the baseline data for the project, before the selection is made.Sufficient staff and funds will be provided to support such visit by monitoring team. Grants are Rp 6million (initial) - which is USD 625 equivalent ,and Rp 4.5 million (subsequent) which is USD 469equivalent for community libraries; Rp 5 million (initial) - which is USD 521 equivalent and Rp 3.5million (subsequent) - which is USD 365 equivalent for single schools and Rp 7 million (initial) - which is729 equivalent and Rp 5 million (subsequent) - which is USD 521 equivalent for multiple schools. Thegrants will cover: books and magazines (at least 60% of the grant), library materials (posters, book repairmaterial, paper, writing materials), simple fumiture and furnishings of the library (e.g., bookshelves, bookboxes, tables, display boards, mats, chairs), simple equipment (typewriter, tape recorder, other electricalequipment, provided electricity is available and a budget for its use is provided), money for librarypromotion activities (reading and storytelling hours, activities using the library and dealing with books suchas recipe showing), and minor repairs and improvement to make the library room usable (installation of adoor, locks, adding a window, etc. for not more than 20% of the first grant).

4.1 Procurement of books and magazines under the grants (US$ 1.48 million equivalent,including contingencies). Each Grant recipient will have a maximum of USD 2,000 equivalent topurchase books, magazines, and other reading materials. Most of the libraries especially those inthe rural areas will be far remote from bookstores that have a sufficient selection to provide theright kind of materials to these libraries. Publishers are also not willing to mount district levelbook fairs, with the expectation of relatively small sales. It is, therefore, planned that districtlibraries would be responsible for ensuring that a sufficient selection of the right materials isavailable in a district. District libraries will be required to hold book fairs in their district to beattended by all participating community and school libraries. Each of the participating librarieswould then prepare a detailed description and quantity of books, and purchase directly from the

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bookstores/publishers. Before committing on the prices, the Grant Recipients will verify the pricesto ensure that the prices are reasonable before order is placed by comparing with published pricelist by the publishers. For this purpose, the standard fonn will be developed and included in theGrant Manual.

4.2 Works (USD 0.13 million equivalent, including contingencies). Minor repairs andimprovement are expected to be very small in nature in each library. The maximum grant portionper grant recipient for this work is IDR 2.4 million (USD 320 equivalent). Each library may hirequalified foremen/laborers from within the Community at market unit rates who will be paid ondaily basis. The materials for repair works will be purchased by the respective library directly fromsuppliers/providers with records on comparison of prices to ensure that the prices are reasonable.For this purpose, the standard form will be developed and included in the Grant Manual.

4.3 Goods and Equipment (USD 0.50 million equivalent, including contingencies). Goods andequipment procured under the Grants category may include library materials (posters, book repairmaterial, paper, writing materials), simple furmiture and furnishings of the library (e.g.,bookshelves, book boxes, tables, display boards, mats, chairs), simple equipment (typewriter, taperecorder, other electrical equipment, provided electricity is available and a budget for its use isprovided), with total amount per Grant recipient is not to exceed USD 1,500 equivalent.

Those goods/equipment will be purchased following national shopping procedures. For thispurpose, a standard form, which will be used by the Grant Recipients in obtaining prices, will bedeveloped and included in the Grant Manual.

4.4 Library Promotion Activities (USD 0.35 million equivalent, including contingencies).Library promotion activities include:(a) Hiring of a number of individuals for reading and storytelling hours. These individuals will behired on the basis of qualification of the local people as identified by the Library Team and theCommunity. The Terms of Reference for such individuals are stated in Attachment 6-3.(b) Activities using the library and dealing with books (for example: reading and writingcompetition) are part of incremental operating expenses of each library. Therefore, expendituresfor these activities will follow Govemment procedures acceptable to the Bank.

5. Training and Workshops (US $ 0.57 equivalent, including contingencies). The activities underthis category includes : (a) Information dissemination/orientation to local government, legislative body,private institutions, and other parties, (b) Reading habit competition, (c) Book fair, and (d) Projectmanagement and library training activities.

5.1 Information Dissemination, Reading Habit Competition, and Book Fair (US$ 0.11 miflionequivalent, including contingencies). The dissemination of information on or about this projectwould be conducted through meetings with the stakeholders as well as press release, in whichgovernment procedures acceptable to the Bank will apply.The Project also intends to have a reading habit competition which will be carried out by PPIUand the District Libraries following the govemrnent procedures acceptable to the Bank. As theoutcome of the competition, the winning titles will be selected to be printed (see paragraph 3above).The District Libraries will also conduct a book fair, which expenditures will be spent following thegovernment procedures acceptable to the Bank.

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5.2 Training (US$ 0.46 million equivalent, including contingencies) for provincial and districtlibrarians, community and school library managers, and staff carrying out the monitoring processwill be carried out by trainers from the national library and from the provincial libraries. Suchtrainers will be identified and selected by PPIUs and CPMU. The Terms of Reference andqualification requirements for such trainers are found in Attachment 6-3. After the selection ofthese trainers are completed, then these trainers will be trained by the training consultants (NOTE:the training consultants will be hired under procedures as described in paragraph 7). Since thesetrainers are government officials, the fees for trainers are not eligible for Bank financing and shallbe financed through the Govenmment's own budget. The training related expenditures (such as:staff travel and subsistence allowances, provisions for consumable materials, and othertraining-related activities) would follow government administrative procedures.

6. Project Management (US$ 0.60 million equivalent, including contingencies). Support forproject management activities including travel and subsistence allowances, office support, meeting support,project review and annual plan workshop for local governmenit and community/private institutions, andprovision of consumable materials are incremental operating cost, which would be provided in accordancewith Government administrative procedures acceptable to the Bank.

7. Consultant Services (US$ 0.65 million equivalent, including contingencies). The technicalassistance for impact evaluation and analysis studies (USD 66,010 equivalent) will be selected inaccordance with Selection Based on Consultant Qualification procedures (CQ). The selection process willbe carried out by CPM&U.

8. Procurement Review by the Bank. It is expected that about 14% of total expenditures would besubject to prior review.

The following prior review thresholds have been established':* Works: USD 50,000* Goods: USD 25,000* Consultant Services: USD 50,000 (finns) and USD 25,000 (individuals) and TORs for all

contracts.

All other contracts below the above thresholds are subject to random post review conducted biannually bythe Bank to cover at least 20% of contracts implemented in that period. The sampling should be selectedsuch that priority be given to provinces/implementing agencies with more procurement problems and needmore assistance. In addition to the standard ex post review, specific procurement management reviewshould also be conducted including the assessment of the effectiveness of GOI's monitoring and supervisionimplementation with respect to procurement. The contracts which are subject to prior review shall bedetermined from the procurement plan up front, which is updated annually acceptable to the Bank.

1/ Due to the fluctuation of the Rupiah value to a US Dollar, it would be beneficial to the Project to have a fixed exchange ratein order to determine whether such contract packages are subject to the Bank's prior review. Therefore, the Ministry of Financehas issued a decree to state that the exchange rate to be used for determining the threshold for prior review is at IDRIO,000/USD. This understanding will be updated from time to time with Bank's prior agreement.

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Procurement methods (Table A)

Table A: Project Costs by Procurement Arrangements

(US$ million equivalent)

Expenditure Category Procurement Methodl/

ICB NCB Other2/ NBF Total Cost

1. Goods 0.00 0.00 0.13 0.00 0.13(0.00) (0.00) (0. I 0) (0.00) (0.00)

2. Grants 0.00 0.00 2.46 0.00 2.46

(0.00) (0.00) (2.46) (0.00) (0.00)3. Training 0.00 0.00 0.57 0.00 0.57

(0.00) (0.00) (0.46) (0.00) (0.00)4. Project Management 0.00 0.00 0.60 0.00 0.60

(0.00) (0.00) (0.48) (0.00) (0.00)

5. Consultant 0.00 0.00 0.65 0.00 0.65

(0.00) (0.00) (0.65) (0.00) (0.00)6. Honoraria 0.00 0.00 0.12 0.00 0.12

(0.00) (0.00) (0.00) (0.00) (0.00)

Total 0.00 000 4.53 0.00 4.53________=____________ (0.00) (0.00) 4.15 (0.00) 4.15

1/ Figures in parenthesis are the amounts to be financed by the IDA Credit. All costs include contingencies.2/ Includes civil works and goods to be procured through national shopping, direct contract, community

participation, and consulting services.

Table Al: Project Costs by Procurement Arrangements

(US$ million equivalent)

Consultant Service Selection method

Expenditure Category OCBS OBS SFB LCS CO Other NBF Total Cost 1/A. Firms 0.00 0.00 0.00 0.00 0.07 0.00 0.00 0.07

(0.00) (0.00) (0.00) (0.00) (0.07) (0.00) (0.00) (0.07)

B. Individuals 0.00 0.00 0.00 0.00 0.34 0.24 0.00 0.58(0.00) (0.00) (0.00) (0.00) (0.34) (0.24) (0.00) 0.00

Total 0.00 0.00 0.00 0.00 0.41 0.24 0.00 0.65(0.001 (0.00) (0.00) J0)L 0.0L (0.41) (0.24) 0.00 0.65)

1/ Including contingenciesNote: QCBS = Quality- and Cost-Based Selection

QBS Quality-based SelectionSFB = Selection under a Fixed BudgetLCS Least-Cost SelectionCQ = Selection Based on Consultants' QualificationsOther = Selection of individual consultants (per Section V of Consultants Guidelines)N.B.F. = Not Bank-financedFigures in parenthesis are the amounts to be financed by the Bank Credit.

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Prior review thresholds (Table B)

Table B: Thresholds for Procurement Methods and Prior Review i/

Contract value Procurement Contracts SubjectExpenditure Category Threshold Method to Prior Review

(US$ Thousand)

1. Goods- Office equipment/supplies 25,000.00 National Shopping 0.03and printing

- Books/reading materials 25,000.00 Direct Contract 0.00

2. GrantsCommunity 0.00

Works 50,000.00 ParticipationBooks 25,000.00 Direct ContractOther Goods 25,000.00 National Shopping

3. Training 2/ -- N/A 0.00

4. Project Management 2/ -- N/A 0.005. Consultant- Impact evaluation studies 50,000.00 CQ 0.07

- Innovative approach to reading 50,000.00 CQ 0.00promotion and community parti-pation

- Individual assignments 25,000.00 Individual 0.55

TOTAL _ 0.65

Overall Procurement Risk Assessment

High

Frequency of procurement supervision missions proposed: Once every 6 months (includes specialprocurement supervision for post-review/audits)

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Disbursement

Allocation of credit proceeds (Table C)Table C: Allocation of Loan Proceed

Amount in Amount in FinancingExvenditure Categorv US$ million 1/ USDRmiHlionlL Percentage

I Grants to Small Libraries 2.49 1.96 100%2 Goods 0.10 0.08 80%3 Technical Asistants 0.54 0.53 80%4 Training 0.50 0.35 80%5 Project Management 0.52 0.35 80%

Total Credit 4.15 3.27

11 Excluding expenditures for honoraria of trainers (training) and honorariafor project management staff (project management) which should be fullyfinanced from the GOI counterpart funds.

Financial Management AssessmentAssessment of the financial management capability and control environment were conducted by the BankFMO at the National Library at Jakarta, the Provincial Office of National Library at South Sumatera,District Library of Muara Enim and two community libraries at the respected district. The assessmentfound certain issues and weaknesses and therefore an action plan was agreed to strengthen the financialmanagement capacity (Attachment 64). The objective of the action plan is to ensure that the project willhave a sound financial management system when the project becomes effective.

Following are the financial management risks to be addressed in the project:

1. Risk due to the lack of capacity and understanding on roles and duties of the project management staff isaddress by (i) adoption of a Project Management Manual (PMM) covering the procedures to be followed inthe project; (ii) training on procurement and financial management for the relevant staff within the CPMU,PPIUs and District Libraries (DLs).

2. Risk of misunderstanding on the role of community and school librarian on their participation in theimplementation of the grant provided under project. The risk is addressed by (i) adoption of a LibraryGrant Manual (LGM) covering procedures for the selection of school and community libraries,establishment of SLT and CLT in eligible libraries, flow of grant funds, procurement and uses of grants,book-keeping and reporting procedures to be followed by the participating libraries; (ii) training on theLGM to participating libraries

Financial Management Arrangements

Accounting system and procedures: The accounting system and procedures will follow the governmentaccounting system. The specific accounting procedures for the project will be provided in the PMM. EachPPIU shall maintain separate sub-project accounts and CPMU shall consolidate them for preparation of theproject account.

Project Management Manual (PMM). The PMM will document the system and procedures to be followed

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by CPMU, PPIUs and the DLs (including consultants) to ensure their understandings and roles in theproject. This should help to ensure a sound financial management practice in the project. The PMM shallset out internal control, organization structure and job description, budgeting, procurement, disbursement,accounting, reporting, auditing arrangements. The draft version of PMM is to be provided at negotiationand thefinal PMM shall be issuedprior to the loan effectiveness.

Library Grant Operation Manual (LGOM). The LGM will document the system and procedures to befollowed by SLT and CLT, DLs, PPIUs and CPMU. The LGM shall describe the mechanism of theselection and provision of library grants, including the selection of school and community libraries,establishment of SLT and CLT in eligible libraries, preparation of grant proposal, flow of grant funds,procurement and uses of grants, book-keeping and reporting procedures to be followed by the participatinglibraries. The draft version of LGOMis to be provided at negotiation and thefinal LGOMshall beissued prior to the loan effectiveness.

Book keeping at the small libraries: The SLT and CLT, formed in the school libraries and communitylibraries, shall be responsible for uses of the grants and maintain the accounts following the book-keepingformat to be provided in the Library Grant Manual. Progress Report of the participating library shall beput in the library's announcement board to enable the readers community to exercise controls.

Project Management Report (PMR): On a monthly basis, each SLT and CLT shall submit a progressreport to the DL. DL shall also prepare a monthly report for of its activities and compile it with theprogress reports received from participating libraries into a district PMR. The district PMR should beforwarded to the PPIU, one week after end of the month. PPIU shall prepare a quarterly report for of itsactivities and compile it with the district PMRs received from DLs into a province PMR for submission tothe CPMU, two weeks after the end of the quarter. The CPMU would then prepare the overall consolidatedPMR for the project for submission to the Head of the National Library and the Bank, no later than onemonth after the end of the quarter. The format of the PMR, which cover financial management report,project progress report and procurement management report, have been discussed and agreed during theappraisal. The format will cover financial report, project progress report and procurement managementreport. It is anticipated that the project may not be able to produce satisfactory PMR immediately aftereffectiveness, but after two or three quarters.

Disbursement Arrangements

The CPMU and PPIUs will be responsible for procurement and authorizations of expenditures under theircomponents. DLs shall be responsible for the purchases of their books and other reading materials andmaking the arrangements for training of the small libraries, of which advances would be provided by thePPIU to the DLs. All payments to meet the project expenditures would be channeled through the relevantTreasury Offices (KPKN), against request for payments made by the CPMU or PPIUs.

Immediately after the credit effectiveness, DG Budget shall issue a circular letter to the relevant KPKNOffices providing guidelines and criteria for eligible project expenditures in accordance with the CreditAgreement, including the expenditure arrangement for participating libraries.

Special Account. Government of Indonesia will establish a US dollars Special Account (SA) at the BankIndonesia, under the name of Directorate General of Budget with an authorized ceiling at $500,000. TheSA deposit initially will be limited to $250,000 until total disbursement reached $1 million. The SA'smanagement is essentially under the responsibility of CPMU, who prepare the request for replenishment ofSA as required. The replenishment of the Special Account may be based on quarterly PMR only after the

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production of PMR satisfactory to the Bank, otherwise traditional SOE and full documentationdisbursement will be used.

Use of Statement of Expenditures (SOE). Given to the small nature of the expenditures, disbursements willbe made against statement of expenditures (SOEs) for library grants, training, goods, project managementand individual consultants contract valued below $50,000 equivalent each. Documentation forexpenditures under the grants will be retained at the participating libraries, and documentation forexpenditures under the PPIUs and CPMU would be retained at their respective offices. These documentswould be made available to auditors during the annual audit, and to the Bank upon request during thesupervision mission. Other items would be disbursed with full documentation.

Flow of Funds: The CPMU project manager will responsible for authorizing expenditures under the CPMUcomponents in accordance with the agreed budgets under existing government procedures. Whereas, thePPIU's sub-project manager shall be responsible for their components, including the library grants and therelevant project expenditures to be carried out by the DLs. When expenditures are due for payment, theywill submit payment requests to the relevant Treasury Office (KPKN) who will issue payment remittanceorder (SPM) to Bank Indonesia to credit the payee's accounts at the latter's respective banks and to debitthe project Special Account for the Bank's portion.

The project, through PPIUs will provide library grants to small libraries, to be released in five trenches infive semesters. The grants will be channeled through the relevant Treasury Offices (KPKN) who shallmake payments upon PPIU's request. The PPIU and the participating libraries shall sign a library grantagreement which will also stipulates the term and conditions of the uses of the grants, in addition to thosealready provided in details in the LGM. The small libraries will open an account in local bank, into whichthe grant trenches will be transfer as the conditions met. The flow of fund in summary provided inAttachment 6-6.

Auditing Arrangements

The project audits: The quarterly PMR shall be the basis for preparing the annual project accounts. Thefourth quarter PMR would be the annual project account As for other government projects, audits shall becarried by the government auditors. The annual audit of the project accounts, including SOE and specialaccount, shall be furnished to the Bank no later than six months after the end of the government fiscal year.Prior to negotiation, the CPMU has requested the auditor to audit the project in accordance with Terms ofReference for the audit of special purpose financial statement (as in Attachment 6-5) and Audit Manualfor World Bank financed project (EAP, July 1998). The auditor will also audit, due process and duediligence, on the use of the library grants by community or school libraries and assess the attainment ofobjectives according to the agreed performance indicators.

In the efforts to improve transparency in the project, it was agreed during appraisal for the CPMU to sendcopies of the annual audit reports to a selected mass-media. The CPMU would provide the Bank of theselected list of mass-media and other organizations into which copies of the audit reports would be sent to.

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ATTACHMENT 6-1Terms of References of the Project Management

and Procurement-and Financial Management Consultants

The CPMU will hire a Project Management Consultant (individual) and a Procurement-FinancialManagement Consultant (individual). Each PPIU will hire a Project Management Consultant (individual).

CPMU Consultants

A. Project Management Consultant

1. Qualifications and Experience

a. A graduate in either of the following: Engineering, Economics, Finance or similar advanced degreefrom recognized university;

b. At least 10 years of experience in project management of which about 5 years should be in amanagementposition held in an international or national public or private sector organization,preferably in a developing country;

c. Experience with the World Bank funded Projects would be an advantage;d. Good writing and computer skills; ande. Fluent in English (speaking and writing)

2. Reporting and Counterparts

The Project Management Consultant will report to CPMU Project Manager.

3. Responsibilities

Together with the CPMU Project Manager, the Consultant will manage the whole operations andimplementation of the project and ensure that there is a transfer of expertise to CPMU over the course ofthe project. The consultant will be expected to ensure high quality, transparency, problem solving ofproject management issues and facilitating smooth and speedy implementation of the program. In addition,the consultant will ensure overall integration of plans and reports of all programs of the project.

More specifically, the Project Management Consultant will:a. Prepare detailed overall planning for the implementation of the project.b. Assist the CPMU to supervise and monitor the programs.c. Together with CPMU Project Manager, define policies and plans and problem solving on day-to-day

basis.d. Ensure that information flows smoothly and promptly from and to the field and the CPMU.e. Evaluate whether the project objectives are being achieved.f. Coordinate with other consultants and the CPMU to finalize project manuals and guidelines (Buku

Pedoman) which explain basic criteria for library selection, project requirement, budget and fundingmechanism, administrative requirement, tasks and duties of people concerned.

g. In coordination with Library Training Consultant (the communication expert) and CPMU, designinformative booklets giving details of the project.

h. Assist with organization of information dissemination activities and design infornative bookletsgiving details of the programs.

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i. Assist organization of review workshops.j. Responsible for overseeing the work of the province level consultants, and reporting on progress

regularly.k. Work closely with CPMU staff responsible for each activity.1. Keep the CPMU well informed at all times of project activities at all level.m. Assist the World Bank supervision and/or review mission.n. Assist the Project Director and CPMU to ensure that project covenants (among other, annual plans

and reports) are fulfilled and the World Bank supervision aide memoires are followed up timely).O. Assist the Project Management to effectively control the project organization, among others, provide

inputs about project staff perforrnance.

4. Reports

The consultant shall: (i) prepare quarterly progress reports for the Project Manager; and (ii) assist theProject Manager to prepare quarterly Project Management Reports for the Bank.

B. Procurement-Financial Management Consultant

i. Qualifications and Experience

a. A graduate in either of the following: Engineering, Economics, Finance or similar advanced degreefrom a recognized university.

b. At least 5 years of experience in Procurement and Financial Management.c. Experience with the World Bank funded Projects would be an advantage.d. Good computing skills.e. Fluency in English (reading and writing).

2. Reporting and Counterparts

The Procurement-Financial Management Consultant reports directly to the CPMU Project Manager.Moreover, she/he may have a government counterpart, assigned by the CPMU Project Manager.

3. Responsibilities

The consultant will manage both procurement program and financial management for the Project, provideto others the needed technical support and guidance in all aspects of procurement in accordance with theProject Guidelines as described in the Project documents and Loan Agreement.

The Consultant will be expected to ensure quality, transparency, problem solving of procurement andfinancial management issues, and facilitating smooth and speedy implementation of the program. Inaddition, the Consultant will coordinate with the PPIU Project Management Consultants and treasurers toensure overall integration of plans and reports.

More specifically, the Procurement-Financial Management consultant shall fulfill the following tasks:

On Procurement Management:a. Update the procurement plan on regular basis and implementation of the procurement plans for

grants, goods and consultants agreed with the Bank;

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b. Work with the technical specialist to review and update the procurement schedules;c. Ensure compliance with the World Bank Guidelines that apply to the Project;d. Assist the CPMU Project Manager in ensuring that procurement arrangements are consistent with

project implementation and development objectives and, as needed, discuss options and possiblesolutions with the CPMU Project Manager;

e. Prepare the Request for Proposals, Request for Quotations (including specifications and evaluationcriteria) and processing of evaluations;

f. Prepare the procurement documents required to obtain clearance from the World Bank for awardingof contracts and follow-up actions;

g. Prepare the contracts with selected suppliers/consultants, including follow up for delivery ofgoods/services according to schedule;

h. Organize the receipt of goods at entry, customs clearance, and delivery to the final destination;i. Maintain records of goods received, their quality and quantity, compliance with contract

specifications and accounts for actual deliveries;j. In coordination with the CPMU/PPIU Project Managers handle warranty and insurance claims;k. Maintain a proper filing system for all relevant procurement documents in the Project and prepare

needed reports and documents for the World Bank review missions;1. Coordinate with the CPMU/PPIU Financial Officer on contractual payments;m. Train other parties concerned with procurement, such as: auditing agencies/units, other members of

tender board (if any);n. Carry out other procurement related tasks assigned by the CPMUJ Project Manager.

On Financial Managzementa. Responsible for all financial management and accounting functions and activities;b. Interact effectively (including working level interaction) with agencies of the Government of

Indonesia (GOI) including National Libraries (in the central, province and district level) andMinistry of Finance, community and school libraries and other stakeholders of financial matters;

c. Develop and assisted the implementation of financial management and accounting policies andprocedures for the project consistent with World Bank and government requirements;

d. Ensure adherence to financial management and accounting policies and procedures for the project;e. Prepare budgets and financial projection/forecasts for the project activities, including short term

forecasting. Assist other staff with preparation of annual work programs and budgets;f. Ensure that an effective system of internal controls is operational;g. Ensure timely preparation and distribution of Project Management Reports (PMRs) and financial

statements coordinating with the procurement officer, treasurer and project manager;h. Interact effectively with auditors to ensure effective annual audits in accordance with World Bank

requirements;i. Ensure that supervision (internal audit) system is working satisfactorily;j. Follow-up to issues arising out of the supervision (internal audit) system;k. Coordinating with the Ministry of Finance (MOF) to ensure timeliness of information required for

preparation of Withdrawal Application from the MOF for the project and for submission ofappropriate requests to the World Bank to ensure timely flow of funds to the project;

1. Ensure timely and smooth information and transaction flow on finance and accounting aspects of theproject at all levels;

m. Interact effectively with GOI counterpart who engage to work on financial and accounting aspects ofthe project.

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4. Reports

The consultant shall prepare a quarterly progress report (physical and financial) and assist the CPMUProject Manager in the compilation of the Project Progress Report (Quarterly).

PPIU Consultants

Project Management Consultant

1. Qualifications and Experience

A graduate in either of the following: Engineering, Economics, Finance or similar advanced degree from arecognized universityAt least 10 years of experience in project management of which about 5 years should be in a managementposition held in an international or national public or private sector organization, preferably in a developingcountry.Experience with the World Bank funded Projects would be an advantageGood computing skills.Fluency in English (speaking and writing)

2. Reporting and Counterparts

The Project Management Consultant will report to the PPIU Project Manager.

3. Responsibilities

Together with the PPIU Project Manager, the Consultant will manage the whole operations andimplementation of the project and ensure that there is a transfer of expertise to PPIU over the course of theproject. The consultant will be expected to ensure high quality, transparency, problem solving of projectmanagement issues and facilitating smooth and speedy implementation of the program. In addition, theconsultant will ensure overall integration of plans and reports of all programs of the project.

More specifically, the Project Management Consultant at PPIU will:a. Prepare detailed overall planning for the implementation of the projectb. Assist the PPIU to supervise and monitor the programsc. Together with PPIU Project Manager, define policies and plans and problem solving on day-to-day

basis.d. Ensure that information flows smoothly and promptly from and to the field and the PPIUe. Evaluate whether the project objectives are being achieved.f. Assist implementation of Project Management Training for project management staff, Project

Orientation/Library Grant Manual Training for beneficiary librariesg. Assist with organization of information dissemination activitiesh. Assist organization of review workshopsi. Responsible for overseeing the procurement activities and financial management reportsj. Work closely with PPIU staff responsible for each activityk. Keep thee PPIU well informed at all times of project activities at all level

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1. Assist the World Bank supervision and/or review mission.m. Assist the PPIU Project Manager to ensure that project covenants (among other, annual plans and

reports) are fulfilled and the World Bank supervision aide memoires are followed up timely.

4. Reports

The consultant shall: (i) prepare quarterly progress reports for the Project Manager; and (ii) assist theProject Manager to prepare quarterly Project Management Reports for the Bank.

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ATTACHMENT 6-2Positive List

The Grants MAY BE used as follows:

* At least 60% of each grant shall be used for:* Purchase and delivery of books (maximum 3 exemplar per title)* Purchase and delivery of reference books for teachers (maximum I exemplar per title)* Subscription to journals, newspapers and magazines

Not More than 40% of each grant shall be used for:* Purchase of library materials such as office supplies, book repair materials, typewriter, tape recorder

and tapes, display/announcement board, posters, etc.* Purchase or construction of library furniture (bookshelves, tables, chairs, carpets)* Minor renovation and decoration of the library room (not more than 20% of the initial grant)* Transport allowance for the librarians (not more than 5% of the grant)* Regular reading promotion activities, including writing and story telling competitions, quizzes and

other relevant activities (not more than Rp. 500,000 every six month)

The Grants MAY NOT BE used for:* Payment of honoraria to civil servants* Major construction of library facilities* Cost of extending library* Maintain funds in the bank account for purpose of collecting interesta Any purpose other than specified above

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ATTACHMENT 6-3Terms of Reference and

Qualification RequirementsOf the Trainers and Consultants

1. Library Training Consultants

The project will hire five library training consultants to be based in Jakarta and to implement trainingactivities in Jakarta and in the project districts. They will work for total 16 months (6 in 2001, 4 in 2002, 4in 2003 and 2 in 2004).

Qualiifcation and ExperienceFour training consultants shall have the following qualifications:

* A graduate in library, information and documentation science or similar advanced degree from arecognized university

* At least 5 years of experience in the library management* At least 10 years of experience in library training* Able to write modulese Good computing skillsi Good mastery of Bahasa Indonesia and English

One training consultant shall have the following qualifications:i A graduate in comnmunication or sociology or similar advanced degree from a recognized university3 At least 5 years of experience in working directly with community in subdistrict and village levels,

preferably in library-related activities* At least 10 years of experience as trainer• Able to write modules* Good computing skills* Good mastery of Bahasa Indonesia and Englishv Has great communication skills

Reporting and CounterpartsThe training consultants tean will up with government (CPMU) staff assigned by the Project Manager.They will report directly to the Project Director.

ResponsibilitiesThe training consultant team will be responsible for the quality and implementation of library trainingactivities for the participating district, school and community librarians.

The team will also be responsible to prepare a good quality of the trainers Selected central, provincial anddistrict librarians, in order for them to become effective trainers and facilitators for school and communitylibrary staff.

More specifically, they will:* Prepare library training plan* Prepare training curricula and syllabi and write modules for the training of trainers (TOT), district

librarians, and community librarians.

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* Train the trainers and district librarians* Supervise the delivery of training for school and community librarians by the trainers (TOT graduates)* Write a comprehensive report.Note: In addition, the Communication Training Consultant will assist the CPMU and Project Managementconsultant in designing project information booklets.

Contract Awards and Terms ofPaymentThe consultants will be hired individually. Each of them will be awarded a lumpsum contract for total 16months (6 in 2001, 4 in 2002, 4 in 2003 and 2 in 2004).

2. Innovative Approach to Promoting Reading Habits andCommunity Participation

PPIU of each participating province will select 10 school and 5 community libraries to receive additionaltechnical assistance, i.e., innovative approach to promoting reading habits and community participation inlibrary development. Each PPIU will hire a consultant for two consecutive years, 2002 and 2003.

ResponsibilitiesThe consultant, in cooperation with the local librarian and school/ community committee, will beresponsible for the creation and implementation of innovative approaches to promote reading habits andcommunity participation in library development. They will be required to analyze the applicability of theapproaches for possible adoption by other libraries.

More specifically, they will:3 Formulate and introduce innovative approaches to promote reading habits among the community in the

participating school and community libraries' areas.e Formulate and introduce innovative approach to promote community participation (local authorities,

community figures, private institutions, etc.).3 Test and apply such innovative approaches in the selected libraries and closely monitor the result* Train the local librarian and school/ community committee to maintain the successful approach* Write a comprehensive report and prepare recommendations for possible adoption by other libraries.

ReportingThe consultant will provide to PPIU bimonthly report, Mid-Terrn Report and Final Report (includingevaluation and recommendation)

Qualification and ExperienceThe consultant shall have the following qualifications:* At least 3 years of experience in working with village level community in the library/ education/

extension (penyuluhan) related activities.* Have good networking with private organization, charity foundations, and local government* Willing to work closely with participating school and community libraries.* Have key staff with great communication skills.

Contract Awards and Terms of PaymentThe consultant will be awarded a lumpsum contract for total 16 months (6 months in FY 2002 and 10months in FY 2003)

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3. Community Facilitators

In each district, four to five facilitators will be recruited. Each facilitator will make total 42 to 52 libraryvisits per year, including attending library cluster meeting, when she/he is requested.

Qualification and Experience* Minimun DII education in any subject.* Strong interest in working with cornmunity, experience in library-related activities is an advantage* Good communication skills* Mastery of Bahasa Indonesia* Local resident, does not have any plan to move to other area during the project implementation.

Reporting and CounterpartsThe community facilitators will work under coordination of and report to the PPIU ManagementConsultant.

ResponsibilitiesCommunity facilitators will provide ongoing monitoring and feedback at the grassroots level, and providingon-site assistance where required. The PPIU Project Management Consultant and PPIU Project Managerwill follow up their reports and findings.

More specifically, they will:* Verify the data (as written in the grant application/questioners) of library grant candidate recipients

which were identified by the District Committee;* Process the verified data and forward it to PPIU Project Manager.O Assist the school and community library team in understanding and implementing the Library Grant

Manual.

MOU and Terms of PaymentThe community facilitators will work voluntarily. Travel allowances (for transport and food) will beprovided per trip.

4. Library Promotion Activities

In addition to providing books to the school and community libraries, the project will also provide funds forlibraries to bring in local resource person to lead promotion activities. These activities can include storytelling/ writing, poetry reading/ writing, play and drawing competition.

Qualification:The resource person is expected to:- be locally well-known for his! her expertise/ skill (story telling, poetry reading, drawing, etc.)- have a good conmmunication skill and can interact with the audience- be able to create interactive activity using the library collection

ResponsibilitiesThe resource person will present his/ her expertise/ skills (story telling, poetry reading, drawing, etc.) asrequested by the Library Team/ Community at an agreed schedule.

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Terms of PaymentPayment are made per-activity.Library manager should try to get feedback from the library users on their opinion of the activity -whichwill be used as a basis for developing the program promotion activities.

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Attachment 64Action Plan

At Appraisal/PreparationIssues/ Problems Remedial Action Resp. Member Due Date

A. Project Organizationand StaffingEstablishment and Decrees on GOI Byappointment of CPMU and establishment and NegotiationPPIU appointment of CPMU

and PPIUB. Project ManagementManualA Manual to document Draft Project GOI & WB By Negotiationprocedures to be followed Management Manualby CMU, PMU. covering acceptable to the Bank.job description,procurement, financialmanagement, recordmanagement, fixed assetsand inventory management,bookkeeping, reporting,monitoring, evaluationmechanism for the FMsystem.

Issuance of the Pr,eject GOI ByManaRement Manual Effectiveness

C. Library Grant Manual(LG Manual)A manual to document Draft Library Grant GOI & WB By Negotiationprocedures of community Manual acceptable toand school Grants to be the Bank.followed by community andschool libraries, districtlibrary staff and PMUcovering organizations,roles and responsibilities,proposal processing,funding mechanisms,procurement, book-keeping,and reporting requirement. _

Issuance of the final GOI ByLibrary Grant Manual Effectiveness

D. Training1. Training by which Project Management GOI Immediately aftergovernment staff within the Manual training effectivenessCMU and PMU (includingeverybody who will beinvolve in this project) willacquire the necessary skillsto carry out their respectiveduties as described in theProject ManagementManual.

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Issues/ Problems Remedial Action Resp. Member Due Date2. Training by which Training plan for GOI By Negotiationcommunity and school community and schoollibrarian staff, district librarian staff, districtlibrary staff and PMU will library staff and PPIUacquire the necessary skills on LG Manualto carry out their respectiveduties as described in theLG Manual

Training GOI Immediately aftereffectiveness

E. AuditingArrangement of the project Draft audit GOI & WB By Appraisalaudit in accordance with a arrangements and TORspecific TOR for audit discussed and agreed

Letter to Auditor GOI By Negotiation(agreed duringappraisal) confirmingthe audit arrangements

F. PMR EvaluationEvaluation on the Review on FM system GOI & Periodically - limitimplementation of FM and quarterly PMR WB (TTL/ Jun/ Dec. 2002System in CPMU and within 30 days after the FMO)PPIUs including re- quarter end submittedevaluation on potential for to the BankPMR-based disbursements. .

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Attachment 6-S5TERMS OF REFERENCE

for the Audit of Special Purpose Project Financial Statements

ObjectivesThe overall objectives of the audit are: (i) to enable the auditor to express a professional opinion

on the project financial statements, the operation of the overall financial management system includinginternal controls, and compliance with financing agreements; (ii) to provide project management withtimely information on financial aspects of the project to enable follow-up action; and (iii) to assess onthe achievements of project objectives as measured by performance indicators.

The audit should cover the entire project, i.e. covering all sources and application of funds by allimplementing agencies. The auditor should visit the various implementation units and other agencies asconsidered necessary for the audit.

ScopeThe audit will be carried out in accordance with International Standards of Auditing and with the

Audit Manual for World Bank Financed projects (July 1998). It will include such tests and controls asthe auditor considers necessary under the circumstances. Specific areas of coverage of the audit willinclude the following:

(1) An assessment of whether the project financial statements have been prepared in accordance withconsistently applied Generally Accepted Accounting Principles (GAAP) and give a true and fair viewof the operations of the project during the year and the financial position of the project at the close ofthe fiscal year. Any material deviations from GAAP, and the impact of such departures on the projectfinancial statements as presented would be stated

(2) An assessment of the adequacy of the project financial management systems , including internalcontrols. This would include aspects such as adequacy and effectiveness of accounting, financial andoperational controls, and any needs for revision; level of compliance with established policies, plansand procedures; reliability of accounting systems, data and financial reports; methods of remedyingweak controls or creating them where there are none; verification of assets and liabilities; and integrity,controls, security and effectiveness of the operation of the computerized system (if any), and

(3) An assessment of compliance with provisions of financing agreements, especially those relating toaccounting and financial matters. This would inter alia include verification that:

(a) all external funds have been used in accordance with the conditions of the relevant financingagreements, with due attention to economy and efficiency, and only for the purposes for whichthe financing was provided.

(b) counterpart funds have been provided and used in accordance with the relevant financingagreements, with due attention to economy and efficiency, and only for the purposes of whichthey were provided;

(c) expenditures charged to the project are eligible expenditures and have been correctlyclassified in accordance with the relevant financing agreement;

- 47 -

(d) goods and services financed have been procured in accordance with the relevant financingagreement;

(e) all necessary supporting documents, records, and account have been kept in respect of allproject activities

(i) clear linkages exist between the accounting records including accounts books and the ProjectFinancial Statements;

(g) where Special Account has been used, it has been maintained in accordance with theprovisions of the relevant financing agreement.

(h) statement of expenditures (SOE) used as the basis for the submission of withdrawalapplications accurately reflect expenditures and activities on the project

(i) project expenditures as reported by the project implementation agencies are reconciled withthe amounts withdrawn from the Special Account and the amounts deposited to the specialaccount are reconciled with the amounts disbursed from the IDA Credit.

(4) An assessment on the achievements of the planned results of the projects as measured by theperformance indicators as stipulated in the relevant financing agreement.

Project Financial Statements.Each PPIUs shall prepared its project accounts whereas the consolidated project accounts shall beprepared by the CPMU, and should include (i) Annual Project Expenditures and Financing; and (ii)Cumulative Project Expenditures and Financing. Sources of funds would show IDA, other donors, andGOI counterpart funds separately. Project expenditures would be summarized by main projectcomponents, disbursement categories and by project location (province or kabupaten) both consolidatedfor the current fiscal year and accumulated to date. The consolidated project account shall also includeFinancial Statement of Special Account covering: (i) deposits and replenishments received from theAssociation; (ii) withdrawals from the special account; and (iii) the remaining balances at the end of thefiscal year

The auditor should provide an opinion as to the degree of compliance with the Association'sprocedures and the exactitude of the balance of the Special Account at year-end. The audit shouldexamine the eligibility and integrity of financial transactions during the period under review and fundbalances at the end of the period, the operation and use of the special account in accordance with thefinancing agreement, and the adequacy of internal financial controls.

Special Account: The auditor must assess a reconciliation report between the projectexpenditures made from the special account and the withdrawals from the special account.Reconciliation should also be made with the amounts paid from the pre-financing account and directpayments (if any). The auditor should assess a reconciliation report between the amounts deposited tothe special account and disbursed by the Association to the special account.

- 48 -

Statement of Expenditures: The auditor is also required to audit all SOEs (paid from thespecial account and/or other accounts) used as the basis for the submission of withdrawal applications.The auditor should apply such tests and control as the auditor consider necessary under thecircumstances. These expenditures should be carefully compared for project eligibility with therelevant financing agreements, and with reference to the Project Appraisal Document for guidancewhen considered necessary. Ineligible expenditures identified as having been included in withdrawalapplications and reimbursed by the Association should be noted separately by the auditor. The totalwithdrawals under the SOE procedure should be part of the overall reconciliation of Associationdisbursements described above.

Audit ReportThe audit report shall contain the auditor's opinion on the fairness of the project financial

statements, including an opinion on the Special Account and a separate paragraph commenting on theaccuracy and propriety of expenditures withdrawn under the SOE procedures and the extent to whichthe Association can rely on SOEs as a basis for loan disbursement. The report should refer to theauditor's TOR. The auditor should submit the report to the project executing agency who should thenpromptly forward one copy of the audited accounts and report to the Association. It should be receivedby the Association no later than six months after the end of the project's fiscal year.

Management LetterIn addition to the audit reports, the auditor will prepare a "management letter," in which the

auditor will:

(a) give comments and observations on the accounting records, systems, and controls that wereexamined during the course of the audit; and identify specific deficiencies and areas of weakness insystems and controls and make recommendation for their improvement;

(b) give comments on economy, efficiency, and effectiveness in the use of resources;

(c) report on the achievement of the planned results of the project

(d) report on the degree of compliance of each of the financial covenants on the financing agreementand give comments, if any, on internal and external matters affecting such compliance;

(e) communicate matters that have come to attention during the audit which might have a significantimpact on the implementation of the project, and

(f) any other matters that the auditors considers pertinent.

GeneralThe auditor should be given access to all legal documnents, correspondence, and any other

information associated with the project and deemed necessary by the auditor. Confirmation should alsobe obtained of amounts disbursed and outstanding at the Association.

The auditor should be familiar with the Association's Audit Manualfor World Bank FinancedProjects which provide guidance to auditors conducting audits of Association financed projects.

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Attachment 6-6Library Development Project

Flow of Funds

LIIICentral Auditor. | ~~~~~~~~~audits

/ ^ ~~~~~~~~~~~~aDD Jor replenishment_

v ~~~~~~~~~~counteT' Ian

Bank Indonesia __________copies

Headoffice bank DG BUDGET bank * CPMUSpecial Acct. statement statement

Copies SPMDebit to Copies sup.docsSpecial Account Guidelines PM reports V

Auditor

Provinc & District aud

paymentBank Indonesia _ SPM MOF Treasurv requestBranch office KPKN

District Library

Grant Agreement/ Progress Report

fundstransfer

Community/ School Bank Account 1 eithdraws * Community/ School Librarydeposits

The financial management system would include methods and records established to identify, assemble, analyze, classify,record and report on transactions and to maintain accountability for the related assets and liabilities.

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Annex 7: Project Processing Schedule

INDONESIA: LIBRARY DEVELOPMENT PROJECT

Project Schedule Planned ActualTime taken to prepare the project (months) 12 20First Bank mission (identification) 07/31/99 07/31/99Appraisal mission departure 05/01/2000 05/12/2000Negotiations 07/30/2001 05/22/2001Planned Date of Effectiveness 06/09/2000 08/12/2001

Prepared by:

Brigitte Duces and Susiana Iskandar

Preparation assistance:

NA

Bank staff who worked on the project included:

Name SpecialityKenlee Ray LibrarianSusiana Iskandar Operations Officer (Education)Jerry Strudwick Education SpecialistDorothy Judkins Cost tablesNovira Asra Financial managementRizal Rivai ProcurementAnthony Toft Legal CounselRosfita Roesli Operations Officer (Education)Melanie Yuwono Cost tablesYogana Prasta Senior Didsbursement OfficerNaseer Ahmad Rana Senior Procurement Specialist

- 51 -

Annex 8: Documents in the Project File*INDONESIA: LIBRARY DEVELOPMENT PROJECT

A. Project Implementation Plan

I. Project Implementation Plan*2. Project Costab file*3. Project Management Manual*4. Library Grant Manual*

B. Bank Staff Assessments

Asra, K. Novira (2001), Financial Management CapacityAssessment Report, the World Bank, JakartaRivai, Rizal (2001), Procurement Capacity Assessment Report, the World Bank, Jakarta

C. Other

*Including electronic files

- 52 -

Annex 9: Statement of Loans and Credits

INDONESIA: LIBRARY DEVELOPMENT PROJECTMar-2001

Difference between expectedand actual

Original Amount in US$ Millions disbursements

Project ID FY Purpose IBRD IDA GEF Cancel. Undisb. Orig Frm Rev'dP049545 2000 ID-PROVINCIAL HEALTH I 0.00 3800 0.00 0.00 35.89 1.21 0.00

P059477 2000 ID-WSSLIC II 0.00 77.40 0.00 0.00 75.66 0.00 0.00

P059930 2000 DECENT AGR/FOR EXT 13.00 5.00 0.00 0.00 16.87 2.93 0.00

P055821 1999 IND-URBAN POVERTY PROJECT 0.00 100.00 0.00 0.00 41.96 5.29 0.00

P056074 1999 IND-MUNCIPAL INNOVATIONS PROJECT 5.00 0.00 0.00 0.00 3.22 2.23 0.00

P041895 1999 ID-SULAWESI BASIC EDUC. 47.90 15.93 0.00 0.00 55.24 18.41 0.00

P003967 1999 ID-FIFTH HEALTH PROJECT 44.70 0.00 0.00 5.00 32.07 11.72 0.00

P064118 1999 WATSAL 300.00 0.00 0.00 0.00 250.00 250.00 0.00

P063732 1999 CORPORATE RESTRUCTRG 31.50 0.00 0.00 6.12 20.03 26.15 0.00

P040196 1999 ID-SUMATRA BASIC EDUC 54.50 20.10 0.00 0.00 58.11 10.73 0.00

P036049 1999 ID-EARLYCHILD DEVELOPMENT 21.50 0.00 0.00 0.00 19.89 14.36 14.36

P040061 1998 BENGKULU REG DEV 20.50 0.00 0.00 0.00 19.14 7.14 0.00

P048715 1998 IIDP 34.50 0.00 0.00 8.50 20.31 22.17 17.31

P045337 1998 ID-KECAMATAN DEV FUND 225.00 0.00 0.00 0.00 157.58 56.94 0.00

P040062 1998 CORAL REEF MGMT REHA 0.00 0.00 4.10 0.00 2.57 1.65 1.35

P036956 1998 ID-SAFE MOTHERHOOD 42.50 0.00 0.00 8.00 20.67 10.01 6.59

P003993 1998 SUMATRA REG. ROADS 234.00 0.00 0.00 50.00 157.77 28.77 -3.03

P039644 1998 ID-W. JAVA BASIC EDUC. 103.50 0.00 0.00 3.76 60.01 -20.06 0.00

P055755 1998 BANKING REFORM ASST. 20.00 0.00 0.00 0.90 6.42 7.32 0.00

P036046 1998 CORAL REEF MGM REHAB 6.90 0.00 4.10 0.00 4.38 3.72 3.12

P036053 1997 IND-SULAWESI UDP II 155.00 0.00 0.00 67.05 29.47 87.35 -14.08

P004026 1997 RLWY EFFICIENCY 105.00 0.00 0.00 20.00 79.47 77.81 0.00

P036047 1997 IND-BALI URBAN INFRASTRUCTURE PROJECT 110.00 0.00 0.00 30.06 60.68 27.74 15.12

P040195 1997 ID-QUALITY OF UNDERGRADUATE EDUC (QUE) 71.20 0.00 0.00 9.89 34.31 13.59 4.29

P003700 1997 SOLAR HOMES SYSTEMS 0.00 0.00 24.30 0.00 19.27 13.65 3.45

P003987 1997 ID-CENTRAL INDONESIA SEC. EDU. 104.00 0.00 0.00 0.00 63.73 42.93 0.00

P049051 1997 BEPEKA AUDIT MODER P 16.40 0.00 0.00 0.90 10.58 8.60 6.64

P042540 1997 ID-IODINE DEF. CONTROL 28.50 0.00 0.00 9.00 11.31 11.15 10.35

P041894 1997 ID-SUMATRASECEDUC 98.0o 0.00 0.00 0.03 37.45 0.15 0.00

P037097 1996 ID-E.JAVA SEC.EDUC. 99.00 0.00 0.00 3.63 50.30 26.73 0.00

P039312 1996 IND-EASTJAVAUDPII 117.00 0.00 0.00 53.00 17.79 70.79 9.41

P003978 1996 INO'LTECHNOLOGYDEV 47.00 0.00 0.00 8.54 9.21 17.71 11.73

P003699 1996 KERINCI SEBLAT ICDP 0.00 0.00 15.00 0.00 9.85 4.57 0.00

P004003 1996 ID-SECONDARY SCHOOLTEACHER DEVT 60.40 0.00 0.00 30.00 2.73 32.13 -0.60

P004004 1996 ID-HIGHER EDUC SUP.(DUE) 65.00 0.00 0.00 6.86 7.72 -5.43 -8.92

P004008 1996 NUSATENGGARA DEV. 27.00 0.00 0.00 4.90 6.84 6.71 -1.01

P004021 1996 POW.TRANS&DISTII 373.00 0.00 0.00 110.00 74.87 184.87 18.24

P004016 1996 STRATEGIC URB. RDS I 86.90 0.00 0.00 10.00 24.83 28.33 5.62

P004011 1996 SULAWESI AGRI AREA 26.80 0.00 0.00 3.70 6.53 2.17 -3.58

P004014 1996 KERINCISEBLATICDP 19.10 0.00 15.00 3.00 11.94 10.47 0.00

P003965 1995 ID-HEALTH IV:IMPR HEALT 88.00 0.00 0.00 39.00 1.61 34.77 10.61

P003951 1995 IND-KALIMANTAN UDP 136.00 0.00 0.00 15.00 20.10 35.10 11.10

P039754 1995 IND-TAP41-2 28.00 0.00 0.00 3.00 10.98 13.98 5.12

P003968 1995 ID-BOOK & READING DEV 132.50 0.00 0.00 36.50 42.90 73.06 37 88

P003972 1995 AG. RESEARCH II 63.00 0.00 0.00 22.10 15.28 35.38 4.33

P003984 1995 LAND ADMINISTRATION 80.00 0.00 0.00 33.90 0.25 34.15 17.65

P003988 1995 ID-PHRD 11 69.00 0.00 0.00 12.00 9.77 20.11 11.94

P004001 1995 TELECOM SECTOR MODER 325.00 0.00 0.00 69.67 96.38 166.05 116.05

P003890 1994 IND-SEMARANG SURAKARTA UDP 174.00 0.00 0.00 38.67 34.95 73.61 19.23P003910 1994 SUMATERA & KALIMAN P 260.50 0.00 0.00 56.00 43.68 99.68 99.65P003945 1994 HIGHWAY SECTOR II 350.00 0.00 0.00 46.00 61.94 107.94 30.28

P003954 1994 JAVA IRR IMP & W R M 165.70 0.00 0.00 41.17 19.85 59.91 37.90

P004010 1994 DAM SAFETY 55.00 0.00 0.00 19.80 4.26 24.06 -0.58

P034080 1994 BIODIVERSITY COLLECT 0.00 0.00 7.20 0.00 0.26 0.59 0.00

- 53 -

Difference betweenexpected

Original Amount in US$ Millionsr and actual

Project ID PY Purpose IBRD IDA GEF Cancel. Undisb. Orig Frm Rev'd

P003914 1993 ID-THIRD COMM HEALTH & 93.50 0.00 0.00 19.70 1.34 21.04 5.04

Total: 4B34.50 256.43 69.70 905.35 1990.20 1922.15 502.53

- 54 -

INDONESIASTATEMENT OF IFC's

Held and Disbursed PortfolioMar-200 1

In Millions US Dollars

Committed DisbursedIFC IFC

FY Approval Company Loan Equity Quasi Partic Loan Equity Quasi Partic1997 PT Bank NISP 5.71 0.00 0.00 0.00 5.71 0.00 0.00 0.001997 PT Berlian 9.29 20.00 0.00 27.09 8.15 16.65 0.00 23.571995 PT Bunas Finance 5.54 0.00 0.00 1.45 5.54 0.00 0.00 1.451996 PT Dharmala 20.00 0.00 0.00 10.00 20.00 0.00 0.00 10.001995 PT Grahawita 0.00 0.00 5.00 0.00 0.00 0.00 5.00 0.001995 PT Hotel Santika 3.78 0.00 0.00 0.00 3.78 0.00 0.00 0.001991 PT Indaci 0.00 0.00 1.83 0.00 0.00 0.00 1.44 0.00

PT Indo-Rama 22.00 0.00 0.00 0.00 22.00 0.00 0.00 0.001990/91/93/95/99 PT KIA Keramik 16.51 6.02 0.00 53.49 16.51 6.02 0.00 53.491992/94/96 PT KIA Serpih 15.00 6.35 0.00 49.50 15.00 6.24 0.00 49.501995 PT Kalimantan 20.00 15.00 0.00 6.00 15.56 15.00 0.00 4.671997 PT Makro 0.00 1.22 0.00 0.00 0.00 0.00 0.00 0.001997/00 PT Megaplast 8.75 2.50 0.00 0.00 8.75 2.50 0.00 0.001998 PTNusantara 3.18 0.00 0.00 10.38 3.18 0.00 0.00 10.381993 PT PAMA 0.00 0.71 0.00 0.00 0.00 0.71 0.00 0.001994 PT Pramindo Ikat 25.00 8.18 25.00 59.50 25.00 3.91 25.00 59.501996 PT RIMBA 2.53 0.60 0.00 0.74 2.53 0.60 0.00 0.741991 PT Samudera 0.00 5.00 0.00 0.00 0.00 5.00 0.00 0.001993 PT Sayap 10.00 0.00 0.00 14.00 10.00 0.00 0.00 14.001997 PT Viscose 23.59 0.00 0.00 29.46 23.59 0.00 0.00 29.461992/95 PT Wings 8.68 0.00 0.00 14.92 8.68 0.00 0.00 14.921997 Prudential Asia 0.00 4.80 0.00 0.00 0.00 2.24 0.00 0.001994 SEAVI Indonesia 0.00 1.43 0.00 0.00 0.00 1.43 0.00 0.001991 Semen Andalas 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.001980/87 Ciluluk Village 0.04 0.00 0.00 0.00 0.02 0.00 0.00 0.002000 KDLC Bali 2.08 1.14 0.00 0.00 2.08 1.14 0.00 0.001994 LYON-MLF-lbis 2.01 0.00 0.00 2.01 2.01 0.00 0.00 2.011991 Manulife 0.00 0.32 0.00 0.00 0.00 0.32 0.00 0.001988 POF 5.14 1.93 0.00 6.00 5.14 1.93 0.00 6.001995 PT ABS Finance 0.00 1.31 0.00 0.00 0.00 1.31 0.00 0.001995 PTAdeSAlfindo 10.29 3.53 0.00 17.64 10.29 3.53 0.00 17.641997 PT Agro Muko 0.00 2.20 0.00 0.00 0.00 2.20 0.00 0.001989 PT Alurnindo 18.50 0.00 0.00 16.00 18.50 0.00 0.00 16.001997 PTArgoPantes 9.38 13.00 0.00 11.36 9.38 13.00 0.00 11.361991 PT Astra 0.00 5.82 0.00 0.00 0.00 5.82 0.00 0.001989/91/94 PT AstraGraphia 0.00 2.00 0.00 0.00 0.00 2.00 0.00 0.001997 PT Astra Otopart 0.00 1.07 0.00 0.00 0.00 1.07 0.00 0.001997 PTBBLDharmala 11.35 0.00 0.00 21.40 11.35 0.00 0.00 21.401993/96 PT Bakrie Pipe 17.14 0.00 9.50 0.00 17.14 0.00 9.50 0.001995

Total Portfolio: 275.49 104.13 41.33 350.94 269.89 92.62 40.94 346.09

Approvals Pending CommitmentFY Approval Company Loan Equity Quasi Partic2000 NISP Equity 0.00 0.00 5000.00 0.002000 PT Petrosea 15000.00 8200.00 1800.00 0.00

Total Pending Conmmitment: 15000.0 8200.00 6800 nO o.oo

- 55 -

Annex 10: Country at a Glance

INDONESIA: LIBRARY DEVELOPMENT PROJECTEast

POVERTY and SOCIAL Asti a Low-Indonesia PacifIc income Development diamond*

1999Pnnolaton mid-vyar (trlonql 7it7 (0 I Ait7 2417 Life expectancyGNP tot caDita lAtl/s mothod. US$i SR0 1.000 410rNP (Atlas method. USs btfion0s 120 1 1 8g l 9Rg TAverace annual orowth. 1993-99

Pnnlartion 1/) I 1i 1 9|Labor foire %Y) 2 7 1.3 2 3 GNP < '5 Gross

per rprimaryMost, recent estimate (latest vear available. 1993-991 capita J /nrnllnn

Povertv Y of oooulation bolow national Dovetrlv linroi 20i Irhan non afin,, /% oifofl 1010O0)fiotonl 3, S 4 14Life exoectancv at birth fvears) 65 69 60intent rn,rtAlitv (oer 10G0 five tir7hsti 43 36 77C.hild rralnutrition 1% of (children tundor 51 34 77 43 Access to safe waterAcces to inmoroved water so,rce 0% of,oooulationl 62 84 64IlitPrayv t% of nomlaaion aao 15-- 14 1.S 3e

Gross ornmarv enrollment /% of scrhoo/-aoe DoDulationi 113 11t9 96 fflndonesiaMale 11S 121 102 Low-incomegroupFermale 110 121 RC,

KEY ECONOMIC RATIOS and LONG-TERM TRENDS

1979 19f9 1998 1999 -~ - - -

Economic ratiosGDP (US$ Wlhioosi S6 1 101 5 96 8 1S1 7Gr"oss dnmels8t invostmant/lrtp 24 6 29 1 20 n 19 1 Fvnnrts of rinodr arnd serviore/G3np 306 2 1 2 4t TradeGross domestic savinos/GOP 32 8 32 A 29,4 21 0Cnse natinnat qavinnqI r P 23 i 24 4 13 S

Current account balance/GDP - 16 4 7 4,2 tInterAst navnpntsW/t.fP t i 3 .3 7 4 R InvestlmentTntal dihtGitrP .t3 R 5A S 182 7 97r Savings ¾'-Total debt sorvicelexDorts 37 5 34.7 37 9Pres.nt va- ol- tfdhtitGnp 146i 4Present value of dobt/exoorts . 2649

Indebtedness1979.89 1989-99 199f 1999 1999.03

(average annual orowth)G,n P 5 r1 S R -tn (n 9 3 4 I 8ndonesiaGNP ner ranit. R39 3 4 -17 8 0 4 2 .6 Low-income groupgixrorts of ooods and services 1 4 6 9 11.? -31.6 7.7

STRUCTURE of the ECONOMY1979 1989 1998 1999 Growth of investment and GDP (%)

I% of GDPI 40 Anricrlti,re 27 3 21 7 17 n 17 IIndustrv 37.7 38.3 42.7 431 2 ;

Manifact- rint 117 19.7 24 1 25.4 _2 =Services 35.0 40.0 40.3 39.6 -20 94 s5 9 9 V7

Private nc ntion 57 fi .SR S fiS 1 72 . -40

Genpral r,,vrnmpt rnnr c Mtinlion 9 S A 7 si f S ' * -- GD GDPImoorts of anods and services 22.6 21.4 41 7 26.9

1979-89 1989-99 1998 1999 Growth of exports and imports (%)(averace annual arowthlAnricultuir. 34 2 5 -0 7 2 1 40

Industrv 6.5 7.2 -14.0 1.2 20

Manufar.trinn 13 . 82 7 11 4 2 f -

Servirc.e 7 n 4 7 -1R 4 -1 4 94 95 96 97 4 9920

Private rnncirmninrn 6 s 7 3 -fi 3 3 7 _40General nnv.rnmpnt rcnsi,mrtinn . .3 n 8 -.1 4 0 7Gross domestic investment 6.7 3.9 -34 6 -20 1inOrit nt noons and servir-e 1 6 66 -S 3 -407 -4vpens 7mprtsGross national oroduct 5.9 5.1 -16.5 2 0

Note: 1999 data are preliminary estimates.

The diamonds show tour kev indicators in the countrv (in bold\ comeraed with its income-arouo averaae If data are missina. the diamond willhb inonmnlete

- 56 -

Indonesia

PRICES and GOVERNMENT FINANCE

Domestic prices 1979 1989 1998 1999 Inflation (#)

(% change) 100.Consumer prices .. 6.4 58.5 20.5 75

Implicit GDP deflator 33.6 10.0 81.2 12.8 0o

Govemment flnance 25(% of GDP, includes current grants) 0Current revenue .. 17.1 15.1 18.3 94 95 96 97 9b 9

Current budget balance .. -3.9 0.5 2.8 GDP deflator '*CPIOverall surplus/deficit .. .. -3.2 -1.5

TRADE

(US$ millions) 1979 1989 1908 1999 Export and Import lavels (USS mill.)

Total exports (fob) .. 23,833 48,354 55,546 60,ooFuel .. 9,340 7,424 10,256Rubber .. 952 1,420 1,229 40000Manufactures .. 7.669 23.322 26,281

Total imports (cif .. 19,624 33,778 35,945Food .. 521 1,284 1,787 20000Fuel and energy .. 3,146 3,122 3.958Capital goods .. 5,904 6,388 3,366 W

93 94 95 96 97 98 99ExDort once index (1995=100) .. 83Imoort once index (1995=1001 .. 87 .. .. U Exports *ImportsTerms of trade (1995=100) .. 95

BALANCE of PAYMENTS

(US$ mnit lonsl 1979 1989 1998 1999 Current account balance to GDP (%)

Exports of goods and services .. 25,460 52,722 59,317Imports of goods and services .9419.675 41.080 41,972-Resource balance .. 5,785 11,662 17.345 4 U ,Net income .. -2.920 -8,066 -10,958 2Net current transfers .. -4,464 1.013 -99

Current account balance .. -1,599 4,609 6,288

Financing items (net .. 1,847 -3,140 -2.836 . 99Changes in net reserves .. -248 -1,469 -3,452 .4

Memo:

Reserves includina oold lUSS millionsl .. ). 26.169 31.221Conversion rate (DEC. locallUSSI 623.1 1.770.1 10.013.6 7.405.0

EXTERNAL DEBT and RESOURCE FLOWS1979 1989 1998 1999

(USS millions) CompositIon of 1999 debt (USS mill.)Total debt outstanding and disbursed 18.624 59,402 150,875 147,435 A: 11,578

IBRD 739 8,542 10,692 11,578 G:20,941 B:682IDA 525 854 694 682

0:9,090Total debt service 3,065 9,833 18.967 23,225

IBRD 95 1,134 1,456 1,584 0:9,083IDA 4 15 26 29

Composition of net resource ftlowsOfficial grants 137 214 255Official creditors 555 2,935 2,696 E: 32,054Private creditors 99 80 -3,653 0Foreign direct investment 226 682 -356 F: 64,007Portfolio equity 0 199 250

Worid Bank programCommitments 815 2,007 1,672 1,693 A- IBRD E - BilateralDisbursements 229 1,258 1,212 1,506 B- IDA D -Other mulblateral F - PrvatePrincipal repayments 24 481 754 785 C - IMF G - Short-temNet flows 205 777 458 721Interest payments 76 667 728 845Net transfers 130 109 -270 -124.

Development Economics and EASPR 8125/00

- 57 -

MYANM f OpIAt <,~', r~ Vl*^ 0 1 >< INDONESIA

Andaman ~~~~ -~~ V~~~7~M -~LIBRARY DEVELOPMENT PROJECTAndamon Gulfo f _- . PROJECT PROVINCESSea ! QIIOlU ' - MAIN ROADS

ThAI[ANDd'' I- Su' ' ' ; " ' ' ' ' ' ' "" '' - ' ' ,ib ._, -$ 9 o SELECTED CITIES AND TOWNSo > 'AILASaN-D,, x, PROVINCE HEADQUARTERSSea NATIONAL CAPITAL

...... ). ' .n,, - >.9 qs - '.' ,9\x+? = PROVINCE BOUNDARIES'3 <0' '~~~~~~~~~~~~~~~~~~~~' " ~ ~ ~ ~ ~ ~ ~ ~ ~~~--~~~~INTERNATIONAL BOUNDARIES

'01 / t RIAU ARCIAPELAG ,JAWA TIUR 25 SUDACJ IRSI TENGAHNMs~~~~~~Irm '~~~~~~~~~" 3~0 SIJMATERA BARAT 159A .RAA 2o~ SULAWESI SELATAN

c~~~~.. f 5 J~~~~~~~~AM.I 6 NUSATWG AA ~ SULAWESI TNGR0 '~~~~~~~~SaBENGKULT 131 NUSA TENGGAJLA uTIMU 28 MAWIW UTAPA23 _7 SUMATERA SEaATAN 13 TIMOR 29 MAW;,KO

"-_ ,,< A 1, S ,,MPUNG 10 KALI N ,,,,,,,, 20 'lAN JASALA3

./ "-v / 0 IBANKA 2] DTUN f AMA NTENGA O CR EA AJAY TAEN.22BANTENG KAUMANTAN SENATAN 3 lAN ,AYA TIMUAR

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