metadata: authors: 0: author: PHN
docna: 0: docna: Population, health, and nutrition : fiscal
            1990 sector review
docty: Policy Research Working Paper
subtopic: Health Care Services Industry,Public Sector Management and Reform,Nutrition,Social Development & Poverty
teratopic: Poverty Reduction
abstracts: cdata!: World Bank lending in the population,
            health and nutrition (PHN) sectors increased significantly
            in fiscal 1990. Over the past five years, PHN lending has
            grown rapidly both in the number of projects and in the
            amounts of loans and credits. The future lending portfolio
            indicates continued growth. Bank support of nutrition
            activities, both within the PHN sectors and as components of
            projects outside the PHN sectors, has expanded
            significantly. However, the Bank still faces important
            challenges in its effort to improve the effectiveness of its
            interventions in the PHN sectors. The review suggests a
            number of recommendations for further improving performance.
            On the technical side, the Bank should: (1) continue to
            focus and improve its interventions at the policy level; (2)
            address management and institutional development issues more
            rigorously and comprehensively through project, sector and
            research work; (3) squarely address and encompass the role
            of the private sector and NGOs in the design and delivery of
            PHN interventions; and (4) continue efforts to address and
            resolve PHN financing issues, given its comparative
            advantage in this regard. Internally the Bank should: (1)
            address the need to expand staff to accommodate continued
            growth likely in Bank work; and (2) encourage greater use of
            experts from developing countries and the participation of
            beneficiaries in Bank work.
repnme: repnme: Population, health, and nutrition : fiscal
            1990 sector review
display_title: Population, health, and nutrition :
            fiscal 1990 sector review
listing_relative_url: /research/1991/06/699948/population-health-nutrition-fiscal-1990-sector-review
topicv3: Human Resources m1326304 1211,Nutrition m1326779 644,Social Development m1327660 134,Population, Aging and Health m1327736 640,Health m1504661 3480
publishtoextweb_dt: 2010-07-01T00:00:00Z
historic_topic: Poverty Reduction
origu: Policy, Research & Ect Affairs
no_of_pages: 79
model_extractions: **Poiy; Research, and Exernal AHar**

<!-- Start of picture text --> k1A I~~~~~~~~~~~~~~~~~~~~<br><!-- End of picture text -->

**Population, Health, and Nuirition**

# **WPS 707**

This paper -a product of **the** Population, Health, and Nutrition Division, Population and Human Resources Department-is part of a largereffort in PRE to increase awareness of the lessons learned from the Bank's operational work. Copies are available free from the World Bank, 1818 H Street NW, Washington, DC 20433. Please contact Otilia Nado-a, room S6-065, extension 31091 (69 pages, with tables).

World Bank lending in the populatior., health, and nutrition (PHN) sectors increased significantly in fiscal 1990. Over the past five ycars, PHN lending has grown rapidly both in the number of projects and in the amounts ot loans and credits. T- future lending portfolio indicates continued growth. Bank support of nutrition activities, both within the PHN sectors and as components of projects outside the PHN sectors, has expanded significantly.

The content and focus of PHN lending and sector work during fiscal 1990 respond to the needs of borrowing countries and to the Bank's emphasis on human resources development and poverty, and reflects the pertinent issues that PHN sector development work poses today. PHN work now focuses much more on the policy level than it did in the past. Health financing issues continue to be rigorously addressed as a priority. The use of local consultants and the participation of beneficiaries in Bank work is on the rise. Increased attention has been focused on NGOs in recognition of the important role they play in the PHN sectors. Social sector development operations, a new feature of PHN lending, have presented challenges to the Bank because of the streamlining and coordinating of roles and responsibilities in the Bank and at the national level that they require. Efforts to raise cofinancing and coordinate aid are being intensified because of the acute shortages of resources for the sectors in many borrower countries.

The Bank still faces important challenges in its effort to improve the effectiveness of its interventions in the PHN sectors. First and most important, the Bank has not yet comprehensively addressed all facets of the population issue, which encompass full and rigorous consideration by country operations and senior management staff, as well as effective and efflicient delivery of family plaining services. Second, while most PHN staff appreciate the importance of addressing management and institutional development issues, the quality and depth of PHN interventions in this rcgard vary.

The review suggests a number of recommendations for further improving the Bank's performance in the PHN sectors. On the technical side, the Bank should (1) continue to focus and improve its interventions at the policy level; (2) address management and institutional development issues more rigorously and comprehensively through project, sector, and research work; (3) squarely address and encompass the role of the private sector and N0Os **in** ihe design and delivery of PHN interventions; and (4) continue efforts to address and resolve PHN financing issues, given its comparative advantage in this regard.

Internally the Bank should (1) address the need to expand staff io accommodate continued growth likely in Bank work in the PHN sectors and (2) encourage greater use of experts from developing countries and the participation of beneficiaries in Bank work.

Because a population strategy paper is at an advanced stage of preparation, this review withholds suggestions for improving the effectiveness of the Bank's work in the population sector.

**The** PRE Working Paper Series disseniinates thc findings of work under way in the Bank's Plolicy, Rcsearch, and External AffairsComplex. Anobjectiveoftheseries is to get these findings out quickly, even ifpresentations are Iess than fully 1x)lished. The findings, interpretations, and conclusions in these papers do not necessarily represent official Bank policy.

Produced by the PRE Dissemination Centcr
i

# TABLE OF CONTENTS

||Page No.|
|---|---|
|EXECUTIVE SUMMARY|iii|
|CHAPTER I.<br>INTRODUClION: PURPOSE AND SCOPE OF REVIEW|1|
|CHAPTER II. FY90 OPERATIONS: LENDING AND SECTOR WORK|2|
|OVERVIEW OF LENDING|2|
|Lending Statistics|2|
|PHN Projects|2|
|<br>Social Development Projects|4|
|SECTOR WORK STATISTICS|6|
|CHAPTER III. A PERSPECTIVE ON PHN WORK<br>||
|ACCOMPLISHED IN FY90: SPECIAL FEATURES,||
|ACCOMPLISHMENTS, TRENDS, AND ISSUES|8|
|POPULATION, HEALTH AND NUTRITION|8|
|Policy/Program Approacit|8|
|<br>Management/Institutional Development|9|
|PHN Financing|10|
|<br>Roles and Responsibilities in the Management of Social||
|<br>Development Projects|11|
|Non-governmental Organizations|11|
|<br>Methods of Carrying Out Project Design and Implementation||
|<br>and Sector Work|13|
|Co-financing and Aid Coordination|13|
|POPULATION|15|
|HEALTH|18|
|NUTIRITION|20|
ii

# 'APIER IV. THE PHN RESEARCH AND SPECIAL GRANTS PROGRAMS: A FOCUS ON ISSUES AND CHALLENGES IN PHN SECTORS

|24|
|---|

POPULATION 24 HEALTH 24 NUTRITION 25

# CHAPTER V PROSPECTUS

26

# FY91-94 LENDING PROGRAM

26

|Continued Growth|26|
|---|---|
|Nature and Focus|26|
|SUES AND SUGGESTIONS FOR FUTURE WORK|27|
|chnical Issues|27|
|Internal Bank Issues|28|

ISSUES AND SUGGESTIONS FOR FUTURE WORK

# TEXT TABLES:

1. PHN Projects Approved in FY90 2. Co-financing in PHN Projects Approved in FY90

3. Social Development Projects with PHN Components, FY9Q 4. PHN Sector Work Completed by Region, FY81-90

|3<br>4<br>_5_<br>7|
|---|

# ANNEXES

1. PHN Lending, FY86-90 32 2. Major Sectoral Components of Social Development Projecs, FY90 33 3. Description of Selected Sector lbsks Undertaken During FY90 34 4. Summary Desciptions of PHN Projects Approved in FY90 39 _5._ Highlights of Innovative Project Work Undertaken During FY90 42 6. Lending for Population in FY90 Projects 49 7. Population Lending in PHN Projects, FY90 So & Nutrition Components in PHN Sector, Population, Health and WID Operaticns, Approved FY89-90 51

9. Description of Work Undertaken by PHRHN During FY90 58 10. PHRHN Publications During FY90 68
iii

# EXECUTIVE SUMMARY

1. The volume of lending in the PHN sectors showed continued and significant growth in FY90: 18 PHN operations were approved during the fiscal year, valued at US$933.4 million-a 64 percent increase in the number of projerts approved over the FY89 level of 11, and a 70 percen* increase over the FY89 iending volume of USS550 million. In fact, both in terms of number of projects and loan/credit amounts, the volume of PHN lending has grown rapidly over the past five years. The significant reduction in lending volume, which occurred in FY87, was a teniporary phenomenon, largely attributable to slippage in the lending program caused by the reorganization. The growth since that year, however, permitted a rapid recovery FY90 figures exceed those of FY86, the year prior to reorganization, by an o-verall increment of seven projects and by a virtual doubling in the -lue of lending program. Of the 18 operations approved in FY90, 12 are stre;ght PHN projects and six are social development projects--multisectoral operations encompassing the PHN and education sectors, and, in some cases, other sectors, as well, such as water and sanitation, urban, agriculture, women in development. The distribution of FY90 operations by region reveals that almost one half of them (eight) were in the Africa region, six in LAC and two each in the Asia and EMENA regions. The volume of sector work is also on the rise. In FY90, 32 PHN sector reports were completed, three more than the FY89 level, of which 15 were for the Africa region, 8 for Asia, 5 for EMENA, and 4 for LAC.

2. The future lending portfolio indicates a continuation of the growth in lending. The FY91 program is comprised of 20 projects valued at US$940 million, reflecting a growth in numbers of operations of 11 percent and in loan/credit amounts of 1 percent over FY90 The FY92 program indicates further increase over the FY91 program by 45 percent in tenns of projected numbers of operations and by 43 percent in terms of projected loan/credit amoiints. Such anticipated growth, even when discounted by a pipeline factor, is significant. About one-half of operations planned for FY91-92 are in the Africa Region, with the balance being rather evenly distributed across the remaining three regions. The FY91-94 Sector Work Program also shows a continued, strong emphasis on the Africa region: of the 77 sector reports planned over the next four years, 52 (or 67 percent) will be focused on Africa.

3. There are a number of reasons for the momentum in actual and forecasted growth in PHN lending. First, while population has been accorded high priority by the Bank for many years, efforts are currently being intensified to stimulate a demand for and a consequent increase in operations in this sector. Second, the demand for family planning and other population interventions is expected to continue to grow, as more governments, particularly those in Africa, come to fully appreciate the negative impact of population growth on development prospects, as well as the health benefits of family planning services. Third, human resource development i9 accorded very high priority, in the context of overall economic reform and development objectives, by both the Bank and national policy makers, witose dialogues have culminated oftentimes in human resource development strategies. These strategies, in turn, seek the support of various types of Bank interventions, including PHN operations, and PHN components in social development, SAL/SAC and SECAL operations. Fourth, many countries' health sectors, in particular, are currently poorly organized and financed, and face both rapidly escalating service costs and expanding consumer demand. Fifth, the growth in nutrition activities, which began just after reorganization, has accelerated during FY90 and is expected to continue in terms of its presence in PHN lending (including free-standing and integrated projects), as well as its presence in other multi-sectoral and structural adjustment operations.

4. The content and focus of PHN lending and sector work undertaken during FY90 responds to the Bank's emphasis on human resources development and on poverty, and is reflcctivc of
iv pertinent issues and challenges posed by PHN sector development work today. Salient features and some shortcomings in project and sector work undertaken during FY90 to address sector issues are highlighte( elow:

- (a) The categorization of population as a sector and its grouping in the Jank with the health and nutrition sectors have clouded an important issue, which has constrained the Bank's potential for making urgently needed gains on the population front. Rapid population growth has a dramatic impact on the economic development prospects of many countries. As such, not only must the issue of population growth be fully apprecialed by staff who carry the responsibility for macroeconomic and structural adjustment dialogue and operations, it must be rigorously addressed by them as a crucial and integral part of their responsibilities. Pamily planning, while an obvious and important iniervention in support of abating population growth, is not the only intervention at hand. Levels of education, employment, urbanization, the status of women, to name a few, constitute some of the other fectors, which determine actual and desired family size. These determinants of population growth, therefore, need to be more rigorously addresswd by staff responsible for macroeconomic dialogue and operations, as well as by the sectoral staff, whose policy and operational interventions could have some impact ..n these factors.

- (b) A second challenge, which the Bank *- PHN staff in particular -- is facing is to increase the volume and effectiveness of family planning programns in the face of their various stages of development (from well-established programs, whose gains are beginning to plateau, as in some Asian countres, to new Dr nascent programs, some of which are not vet effectively meeting demand, which are in need of basic organizational and design assistance, and which are emerging with, and sometimes without, officially pronounced population policies, as in most African countries.) The growing numbers of governments providing family planniag services, and the growing number of women of reproductive age, taken together with USAID's warning that it cannot continue to underwrite contraceptive supply indefinitely, implies increased demand for Bank resources in this area. In faict, the larger question, within which the commodity issue lies, is that of the almost inevitable demand for increasing Bank support, given the stagnant level of funding from other sources.

- (e) The Bank has made some stiides in the population sector in FY90. In summary, the encouraging news in FY90 lies more in the number and geographical range of lending for population than in the amount of lending alone, though this too was up, and more projects showed substantial support to population than was evident last year. The stimulus to population activities given by cofinancing, particularly in social development projects, has also been very encouraging. The report's overview of the population sector has concentrated on themes that have run through the FY90 program -- increased donor coordination, increased use of NGOs, and increasing integration of population into country development strategies.

- (d) PHN work is focussed much more now at the policy and program levels than in the p3st. Sector dialogue is increasingly carried out in the context of broader, oftentimes, multi-sectoral initiatives or dialogues between the Bank and national governments. Bank investments are more strategic and programmatic in nature, supporting a portion of broader and longer-term policies and programs, and provide for capacity building in policy reform, investment planning, program design, implementation and evaluation.
v

- _(e'_ itforts to coordinate aid, whether through formal<sup>cofinancing arrangements, or less</sup> formal means, are- being intensified, given acute shortages<sup>in resources for the</sup> sectors, and ale being facilitated by the policy/program<sup>approach mentioned above.</sup>

- ff) Key managernentAnstitutional development issues<sup>in the PHN sectors ara numerous</sup> and complex and are crucial to achieving improvements<sup>in PHN sector perfonnance.</sup> There is, however, some variance in the degree to which<sup>Bank interventions have</sup> attempted to address these issues. A number of interventions<sup>to strengthen the</sup> managen.ent of an institution or part of an institution<sup>are limited to the provision</sup> of training, technical assistance, additional staff and equipment,<sup>and have not</sup> addressed in depth more difficult and sensitive issues<sup>such as: the orgarnizational</sup> structure of ministries and of the programs and<sup>service delivery systems; the extent</sup> to which such organizational structu.es respond to<sup>decentralization policies;</sup> problems of inter-agency coordination and territorial issues.<sup>There are, howeve'</sup> notable examples of FY90 projects which have addressed<sup>these issues fully and</sup> squarely.

- (g) The use of local consultants and the participation<sup>of beneficiaries in project design,</sup> development and implementation is on the rise.;

- (h) Health financing issues continue to be rigorously addressed<sup>as a priority through</sup> lending, sector and research work;

- (i) Multi-sectoral operations, in the form of social development<sup>operations, a new</sup> feature of PHN lending, have presented new challenges<sup>to Bank staff in streamlining</sup> and coordinating roles and responsibilities within the<sup>Bank and at the national level;</sup>

- (J) In recognition of the important role NGOs play<sup>in the PHN sectors, increased</sup> attention has been focused on them both through project<sup>and sector work.</sup>

- (k) The momentum in nutrition activities which began following<sup>Reorganization has</sup> continued, and in some ways accelerated, during FY90.<sup>Lending has increased and</sup> the pipeline (or future nutrition operations is strong.<sup>Nutrition's linkages with</sup> sector operations outside of PHN including agricuiure,<sup>educat ion, women in</sup> development, and others, as well as with adjustment<sup>activities, have grown stronger</sup> during the year. Staff capacity has been strengthened through<sup>nutrition training</sup> courses and the recruitment and hiring of additional<sup>technical nutrition staff in</sup> three of the four Bank regions. Nevertheless, many<sup>departments still do not have</sup> staff experienced in nutrition operations. The Bank<sup>needs to develop more</sup> institutional capacity to respond to management's commitment<sup>to nutrition and the</sup> many emerging opportunities.

_5._ PHRHN's policy and research program focussed<sup>on a number of the salient issues</sup> outlined above. lbvo studies in process on fertility determinants<sup>and on family planning</sup> effectiveriess will assist Bank staff and national policymakers<sup>alike in the design and targeting of</sup> appropriate family planning programs and policies. Six other studies focus<sup>ont various health</sup> sector issues, including AIDS and adult mortality,<sup>safe motherhood, health policy in Africa,</sup> hospital resource use, disease control priorities and<sup>adult health. A micronutrient study is also</sup> in process, whose results should contribute to improvements<sup>in the effectiveness of nutrition</sup> interventions. PHRHN also manages a portfolio of<sup>eight Special Grants Programs, of which five</sup> target health sector issues, two population and one nutrition.<sup>During the year PHRHN</sup> produced 20 publications, including 2 books, 2 technical<sup>papers, 15 working papers and one</sup> other paper.
vi 6. While the nature and focus of PHN work carried out during FY90<sup>are well placed, in</sup> general, and show great potential for impacting on the<sup>three sectors, there is scope for</sup> improving its quality and impact. The report, therefore,<sup>makes several suggestions for improving</sup> the Bank's work on the PHN sectors which are summarized below.<sup>It does qualify, however,</sup> that it will withhold suggest;Lns particular to the population<sup>sector, pending the completion by</sup> the Population Adviser, PHR, of a population strategy paper, currently<sup>in draft.</sup> 7. With rcspect to technicbi issues, which confront lank staff<sup>working on PHN sectors, this</sup> report suggests that particular eilort in future work bc focussed on the following:

- (a) The increased focus of Bank PHN interventions at the policy<sup>and program levels has</sup> proven an effective means of achieving PHN sector objectives Future<sup>Bank work</sup> should intensify and improve the quality of efforts undertaken<sup>thus far in this area.</sup> Sector dialogue should provide comprehensive and rigorous policy<sup>analysis, which</sup> fully reflects the wisdom and experience of experts residing<sup>in the country/region, as</sup> well as the socio-po;itical context of the country in question.<sup>Decentralization</sup> policies should be fully explored with regard to their practical<sup>application in the</sup> PHN sectors. Project design should provide for capacity building<sup>in policy</sup> formulation, planning and program development, and implementation.<sup>It should</sup> also provide for pilot testing and replication of innovative proposals<sup>for policy</sup> reform. Provision also should be made for the ongoi ig review and<sup>revision of</sup> health sector policies and priorities in the face of eve lving epidemiological profiles.

- (b) Management and institutional development issues need to be addressed<sup>more</sup> rigorously and comprehensively through project and sector work<sup>Particular</sup> emphasis should be placed on: (i) organizational analysis;<sup>(ii) coordination between</sup> institutions and agencies which share responsibility for one or<sup>more of the PHN</sup> sectors; (iii) clear definition of roles and responsibilities of agencies<sup>and staff</sup> involved in the sectors; and (iv) management capacity-building at<sup>every level of</sup> programs and services through practica! training, supervision, limited<sup>and carefully</sup> selected technical assistance, aimed at developing the capacity<sup>of a clearly designated</sup> counterpart, and monitoring and evaluation of targets and performance.

- (c) The role of the private sector and NGOs in the design and delivery<sup>of PHN</sup> interventions is great and growing. Bank interventions in the PHN<sup>sectors must,</sup> therefore, encompass these vital resources as well as the public sector<sup>in order to</sup> maximize the individual strengths and contributionis of all<sup>actors in the PHN sectors,</sup> as well as their collective efficiency and effectiveness. This<sup>strategy is essential and</sup> has great impact potential, given the increasing assistance<sup>and attention accorded by</sup> the Bank to the policy/program arena.

- (d) PHN financing issues will continue to be crucial to the success<sup>a.,d sustainability of</sup> any PHN intervention, whether financed by the Bank<sup>or not. Given its comparative</sup> advantage (in terms of expertise in economics and finance,<sup>as well as the leverage it</sup> possesses at the macroeconomic level), the Bank should continue<sup>its efforts to</sup> address and resolve PHN financing issues, which call for (i) mobilization<sup>of</sup> resources for the sectors (through a number of activities such as co-financing<sup>and</sup> aid coordination; reallocation of public resources within and across<sup>sectors; cost</sup> recovery schemes...), and (ii) effecti-e utilization of<sup>resources (through such activities</sup> as cost containment, investment and financial planning<sup>and management,</sup> decentralized budget decision-making and accountability).<sup>It is particularly</sup> important in addressing this issue to build national capacity<sup>in these disciplines.</sup> Aid coordination, while currently being undertaken in many instances<sup>by the Bank,</sup> should ultimately become the responsibility of governments, whose<sup>plicies and</sup>
vil priorities sheuld drive the content and foccs of external assistance to the secors, rather than the reverse.

& A number of suggestions are also made with rerArd to internal Bank issues, some of which emanate from this report's findings (a - g) wthers of which were suggested by operational staff on the occasion of commenming on this report, in particular suggestion (h):

- (a) PHR lbchnical Diisions have demonstrated their potential for underaking sector work, which has provided a regional dimension to PHN issues and succeeded in enhancing dialogues with, and the involvement of, key staff in the Bank (eg., CODs), as well as regional experts and pollcymakess, in the development and implementation of Bank and national policies, bis contuibution has assisted in the achie.ement of progress in the sectors and should be continued.

- (b) With the growth in numbers and complecity of PHN work, the need to expand staff capacity is evident. Gains have already been made in FY90, both through training and recruitment, but these are unlikely to be sufficient, given continued growth in the sectors as reflected in the FY91-94 lending program. Budget decisions in the Bank should consider this issue carefully, particularly given the high priority accorded to PEHIN sectors. The upcoming Population Strategy Paper will address this issue for the population sector, where a shortage of senior population experts is felt to be critical.

- (c) Efforts should be intensified to employ developing countty experts in all aspects of the Bank's work in PHN and to involve beneficiaries in the design, development and implementation of PHN interventions. The idea of establishing a special fund for internships by the Bank, to provide opportunities for developing country experts to work with the Bank for the first time, should be vigorously pursued.

- (d) Roles and responsibilities in all work related to Social Sector Development Projects should be dearly delegated and streamlined.

- (e) Models and methods 'or co-financing and aid coordination should be further developed and improved, including a full consideration of the costs and benefits of Bank staff involvement.

- (f) Examples of successful coordination with CODs on human resources development aspects of microeconomic dialogue and operations (SAL/SAC) should be built upon and expanded.

- (g) Promotion and expansion of nutrition activity in a wide variety of Bank lending and sector work (SAL/SAC, agriculture, food see, ity, PHN, education...) should be continued, given the success achieved thus far.

- (h) PHRHN should intensify its efforts to improve: (i) communications and exchange of information among staff in the Bank involved in PHN work; and (ii) processes and systems for information collection and analysis.
# CHAP1T:R I. INTRODUCTIION: PURPOSE AND SCOPE OF REVIEW

1. The purpose of this PHN Annual Sector Review is **to** examine and evaluate lending and sector work undertaken during FY90, and the degree to which it contributeA 10 the fulfillment of Bank objectives overall. The report: (a) provides relevant data on the volume and mix of lending and sector work accomplished during the year, (b) undertakes a qualitative assessment of strengths and weaknesses of the work; (c) identifies special features, trends and issues pertaining to such work which may have implication for future strategies and choices in the PHN sectors; and (d) makes suggestions for possible improvements and refinements, which -'ould contribute to the relevance and effectiveness of Bank interventions in the PHN sectors lThe report also describes research and policy work undertaken by PHRHN and its relevance to issues and information gaps identified.

2. The scope of the report has its limits, which should be made explicit in order to %ualify the observations and suggestions made. The report reviews and evaluates lending and sector work; its coverage of projects under implementation is limited, however, to an integration of the major conclusions of ARIS reports, prepared thus far by PHR technical divisions, into this report's analysis of PHN work, contained in Chapter IIL Furthermore, this report's analysis of lending work draws heavily from the 12 PHN projects and six social development projects with important PHIN components approved in FY90. While recognizing that lending work undertaken during FY90 actually encompasses a larger sampling of projects (i.e., those at the preparation, appraisal and negotiation stages at the end of FY90), time and staff available did not permit a complete and rigorous review of all projects being developed during the FY.
2 CHAPTER I. FM OPERAIN: LG AND SEC WORK

## OVERVIEW OF LENDING

# L&pding Statistics

3. In FY90 a total of 18 PHN projects were approved by the Board, valued at US$933.4 million. This reflects significant increase in lending volume over FY89 levels. As stowvn In Annex 1 the number of FY90 operations increased over those in FY89 (11) by 7, or 64 percent; and the value of FY90 lending increased over that of FY89 (USS550 million) by US$383 million or 70 percent. The PFIN share of total Bank lending continues to grow. In FY87, PHN lending accounted for 0.3 percent of total Bank lending for that year. In FY88 and FY89, PHN's share of Bank's lending grew te 1.6 percent and 2.6 percent, respectively. In FY90, this level has, reached a high of 4.5 percent, a 42 percent increase over that of FY89, and is targeted for continued growth over the next few years, as illutrated by an ever-expanding pipeline (paras. _158-159)._ 4. Of the 18 operations categorized under the PHN portfolio, 12 were straight PHN projects, valued at US$813.5 million, and arother six were social development projects, valued at US$119.9 million. Statistics on th-- i2 straight PHt. projects are presented in 13Ibles 1 and 2 and discussed in the section immeliately below, entitled *PHN Projects.! Statistics on the six social development projects are presented in Tbble 3 and discussed in the section of this chapter, entitled 'Social Development Projects."

## PHN Projects

5. lIbble 1 shows the countries, project titles, and loan amounts for straight PHN projects, by region, with regional comparisons for FY89. Africa, with four projects again, doubled its loan volume. Asia went from four projects to two and was the only region with lower loan volume. EMENA, with a very large loan to Morocco, increased its lending by 50 percent with no increase in the number of projects. LAC went from one pruject to four, with a large increase in lending volume, attnbutable, in large part, to the Northeast Brazil Basic Health project. Of the 11 countries on the FY90 list, three were also on the FY89 list (Nigeria, India, and Brazil). Seven of the 12 projects were funded by IDA, four by IBRD, and one jointly.

6. In five of the 12 FY90 PHN projects Bank funds were supplemented by external funds of cofinanciers in the amount of US$32.9 million. lbldng the five cofinanced projects in aggregate, cofinancing -mounted to 16 percent of total project costs or an additionality to Bank's funds of 25 percent. Broken down by region, these levels amount to 18 and 29 percent, respectively, for Africa and 12 and 18 percent, respectively, for LAC, 7. A comparison of the approvals for FY90 with the FY90 lending program table included in the FY89 Review shows the fluidity of the lending program for straight PHN projects, even at the start of a fiscal year. At the start of FY90 the program called for 16 Board presentations. Seven of these were not in fact approved during FY90 (Ghana H/P II, Mali P/H, Senegal P/H II, lbgo P/H, Jordan H, Argentina H and M n H/N). All of these are now programmed for FY91 with the exception of Argentina, which is included in the FY92 lending program. The nine remaining projects were supplemented by three that had not been included **q** the original program: two were advanced (India P VII and Morocco H) and the Kenya P IV was a quickresponse operation (Annex 5, paras. 5-11).
3 <!-- Start of picture text --> Tabl 1 PBHM PROJECTS ;PPUCD ID V190<br>(In US$ millions)<br>Y90 n 90 FYW9 MF9<br>COOURkY PROJECT AEO?U REoGIW RCIOu RWCIO Ru6:<br>TOTAL $ * TOTAL 9<br>AFRICA<br>Kenya Population IV 35.0 IDA<br>Lesotho Population, Health &<br>Nutrition XX 12.1 IDA<br>NiLeria National Easential Drugs 68.1 IBRD<br>Tanzania Health and Nutritlon 47.6 IDA<br>162.8 4 81.3 4<br>ASIA<br>India Population VII 96.7 IDAIIBRD<br>IndLa Tamil Nadu Nutrition 1I 95.8 IDA<br>192.3 2 290.2 4<br>DHENA<br>Morocco Health Sector Developent 104.0 IBRD<br>Ymen A. R. Health IT 15.0 IDA<br>119.0 ? 79.5 2<br>LAs<br>Rollvia Intageated Health Development 20.0 IDA<br>Brazil Northeast Ba,Lc Health IX 267.0 IBRD<br>Colombia Child Care and Nutrition 24.0 IBRD<br>Ha'tL Health nd Population 28.2 IDA<br>3SS2 4 99.0 L<br>GRAND TOTAL 813.5 12 550.0 11<br><!-- End of picture text -->
4 Table 2. COPIRUNCING IN PEN PROJECTS APPRDVED IN FY90 (La US$ millions)

||**_L_**|**_OJIa.OMIT_**|TOTAL<br> **PRDJRC**||||
|---|---|---|---|---|---|---|
|UNTuT|PRojTr<br>A|NGUT|cms|AMOUT|XOF<br>TOTAL<br>**Pi**<br>**COST**|Z OF<br>**_LhNICRED_**ANY<br>**(ADDITIONALIT)**|
|APR!CA|||||||
|Kenya|Population IV|35.0|S.3|<br>2.2|5.3|6.3|
|Lesotho|Population, Health &||||||
||<br>Nutrition II|12.1|22.1|7.1|32.1|58.7|
|Nigeria|National Essential Drugs|68.1|85.1|0.0|0.0|0.0|
|Tanzania|Health and Nutrition|47.6|70.0|15.0|21.4|31.5|
|||162.8|21865|24.3|11.1|14.9|
|ASIA|||||||
|Indla|Population VII|96.7|141.5|0.0|0.0|0.0|
|India|Tamil Nadu Nutrition It|95.8|139.1|0.0|0.0|0.0|
|||192.5|280.6|0.0|0.0|0.0|
|EKO U|||||||
|Morocco|BealthSector Development|104.0|171.3|0.0|0.0|0.0|
|Yemen A.**)U.**|Health II|13.0|19.1|0.0|0.0|0.0|
|||119.0|190.4|0.0|0.0|0.0|
|LAC|||||||
|Bolivia|Integrated Health Developmen|t 20.0|38.6|6.2|16.1|31.0|
|Braail|Northeast Basic Health II|267.0|610.6|0.0|0.0|0.0|
|Colombia|Child Care and Nutrition|24.0|40.2|0.0|0.0|0.0|
|Halti|Health and Populstion|28.2|33S|2.4|7.1|8.5|
|||339.2|723.1|6.6|1.2|2.5|
||GAHDTOTAL|813.5|1,412.6|32.9|2.3|4.0|

# Social Development Projects

& In concert with the increased emphasis on human resource development as an essential part of the develooment process, subscribed to by national governments as well as by the Bank, and facilitated by the merger in 1987 of the PHN and education sectors into human resources divisions, six social development projects, all containing substantial PHN components, were approved during the year. Of these, four were from the Africa Region and two from LAC 9. As ibble 3 indicates, Bank funds approved for these PHN components increased the amount of Bank-approved funds for PHN in FY90 by US$31.6 million, or about 4 p)ercent over the US$813.5 million in approved PHN projects, for a total of US$845.1 mill-on or 4.1
# Table Si SOCIAL DEVELI^KENT PROJECTS WITH PMN COMPONENTS, FY90 (in US$ millions)

||PROJECT|TOT<br>PROJECT<br>COST|OFWBI<br>FINANC<br>BY BA<br>IBRD|Ca<br>ED<br>NK<br>IDA|ANOUNT<br>_PEN Is_<br>TOT PROJ|AMOUNT<br>BANK PHN|PH AS<br>I OF<br>OT PR|C<br>Z<br>P<br>A<br>-|OFINANC<br> OF TOT<br>ROJECT<br>COST -AD|ING<br>xOF<br>LOANICREDIT<br>AMOUNT<br>DITIONALITY)|
|---|---|---|---|---|---|---|---|---|---|---|
|AFRIC&<br>|||||||||||
|C--eroon<br>|Social Dimen.<br>of AdjhButmn Res.<br> <br>|85.7|21.5||23.8|0.0|27.8|53.4|62.3|<br>248.4|
|Chad<br>|Social<br>Development<br>Action<br>|26.9||13.4|6.9|1.6|25.7|12.2|45.4|<br>91.0|
|Ganbia|Womenin<br>Development|151||70|||||||
||<br>|.||.|1.6|0.5|10.6|7.3|48.3|<br>104.3|
|Uganda|Poverty & Social<br>Costs|370||280|||||||
|||.<br>||.<br>|7.8<br>|5.5|21.1|2.2|5.9_|._|
|||164.7|21.5|48.4|40.1|1.6|24.3|75.1|45.6|<br>107.4|
|**LAC**<br>||UC|||||||||
|Bolivia<br>|Soclal<br>Investment<br>Fund<br>|95.6||20.0|57.9|9.2|60.6|43.6|45.6|218.0|
|Jmica|Social Sector<br>_hund_|670|300||||||||
|||.<br>|.<br>||25.7<br>|14.8<br>|36.4|0.0*|0.0*|<br>0.0*|
|||162.6|30.0|20.0|83.6|24.0|51.4|43.6|26.8|87.2|
||GRAD**TOTAL**|327.3 -|51.5|68.4|123.7|31.6|37.8|110.7|36.3|9.0|

*** WhlIl** Is upportlng this project in part **has no** through thls cofinancing, project it is attractLng (paras. 31-33).the **parallel** financing of tho Humn Resources Department Program which the Bank
6 percent of total Bank lending. T'he World Bank Annual Report 1990 categorize social development projects under the PHN sectors and attributes the total value of Bank loans/credits for these projects (US$119.9 million) as commitments to the PHIN sectors, rather than just the value of these operations' PHN components (USS31.6 million), as identified in lhble 3. The World Bank Annual Report 1990 therefore, reflects a higher level of Bank-approved funds for FY90: USS933.4 million or 4.5 percent of total Bank lending for that year. iTble 3 highlights the major contribution of cofinancing to the value of social development projects. lbtal cofinancing for social development projects amounts to USS119 million, virtually doubling the contribution of Bank loans/credits for the six, and constituting over one-third of total project costs. For those five social development projects which received cofinancing, such contribution constituted almost half (46 percent) of total project costs and adds 132 percent to the Bank's contribution. It is significant to note that the USS31.6 million of Bank funds in PHN components represents only one quarter of total costs of PHN components of social development projects implying substantial success in raising large amounts of comnancng for Bank-supported PHN operations.

10. Of these six social development projects, four were managed by PHR divisions (Chad, Gambia, Bolivia and Jamaica) and two were managed outside of PHR divisions: by AF2CO, in the case of Uganda, and by the SDA division, in the case of Cameroon. Of the four PHRmanaged projects, two (Bolivia and Jamaica) focussed on sectors for which PHR is formally responsible (health, nutrition and education) and two (Chad and Gambia) spanned sectors incremental to PHR responsibilities, including agriculture/rtral development, the informal sector, women-in-development, water and sanitation and urban sector, which warranted coordination with other sector divisions. The two externally managed operations focussed on sectors inside and outside PHR's mandate. Annex 2 provides a breakdown of the major sectoral components of these operations. An assessment of the management and coordination challenges posed by such inter-sectoral operations is presented in Chapter III (paras. 21-22), which suggests ways of streamlining roles, responsibilities, proceses and practices based on the lessons learned thus far in our experience in social sector lending.

# SECTOR WORK STATISTICS

11. PHN sector work continues at a high level of activity. As 'lhble 4 below and the lhble in Annex 3 indicate, 32 white through grey cover reports were completed in the past year. The Africa region produced 15 sector reports, laying the foundation for continued expansion of lending in the region. Some of them provide the first overviews of one or more of the PHN sectors in the countries concerned, while others concentrate on subsectors and/or issues in countries, which have already received Bank attention and assistance. Stil others have regional focus. In Asia, with several mature programs, most reports focus on issues emerging in the sectors -- NGOs, financing and poverty, to name a few. In EMENA, the work has concentrated on the development of human resource strategy and the integration of PHN in social development programs. In LAC, the main effort last yenr was in Brazil, with a study addressing issues related to the epidemiological transition, and another on women's reproductive health. Annex 3 contains descriptions of selected sector tasks in an effort to provide some insight on the range and nature of sector work undertaken during FY90.
7 lbbk 4. PHN SECTOR REPOR1S COMPLETED BY REGION, FY8I190 Number of Reports FY1 EY82 U E E FY88 O **E-9** AFRICA I S 6 8 8 6 4 7 9 1S ASIA 1 1 4 4 3 2 0 1 9 8 EMENA 0 0 0 5 1 1 1 2 5 S _[AC_ 0 0 3 . 2 4 2 6 6 4 TOTAL 2 6 13 20 14 13 7 16 29 32
## CHAPTER III: A PERSPECllVE ON PHN WORK ACCOMPLISHED IN FY90. SPECIAL FEATURES. ACCOMPLISHMENTS. TRENDS AND ISSUES

12. This chapter analyzes strengths and weaknesses of PHN work undertaken during FY90, and identifies special features, trends and issues pertaining to this work, which may have implication for future strategies and choices in the PHN sectors. Some of these are common to all three sectors, while others are particular to only one. Brief descriptions of: (i) selected sector work carried out during FY90; (ii) FY90-approved PHN operations; and (iii) other innovative lending work undertaken during FY90 are presented in Annexes 3. 4 and 5, respectively.

# POPULATION. HEALTH AND NUTRION

## Policv/Program Approacn

13. The marked emphasis at the macroeconomic level on human resources development and social sector reform, increasingly supported by the Bank and national governments alike, has set the stage for more prominent and promising Bank interventions in the PHN sectors. An increasing number of SALJSAC discussions and operations have culminated in the development of human resource development programs and strategies, which are supported directly by SAL/SAC operations and/or by PHN or social development projects. SALs for Poland and Hungary, each include PHN sectoral conditionality -- a direct result of the PHR strategy for Eastern European countries in transition to incorporate the issues of the social safety net and PHN policy reform into SAL discussions. Cameroon Social Dimensions of Adjustment/Human Resources, Chad Social Development Action, Uganda Poverty and Social Costs, to name a few SAL/SAC operations, have significant PHN components based on comprehensive human resource development programs and priorities established under these operations. The response of some PHN and non-PHN staff to this relatively new enabling environment is evident in the evolution of the quality, scope and outcome of sector dialogue. Whether initiated by sector work or project identification, sector dialogue is increasingly carried out in the context of broader, oftentimes multi-sectoral initiatives or dialogues between the Bank and national governments. Bank investments emanating from such dialogue are more strategic and programmatic in nature than before and support a portion of broader and longer-term policies and programs, which are more reflective of and appropriate to national issues and needs in the PHN sectors. Tb cite a few examples, the India Population VII Project supports a sector strategy, which emanated from a joint review of the population sector undertaken in 1987 by the government and the Bank. The Nigeria Essential Drugs Project supports the implementation of the Essential Drugs Policy adopted in 1988 by all 21 states. The Jamaica Social Sector Development Project finances a portion of a multi-year Human Resources Development Program, which the Government of Jamaica developed with Bank assistance.

14. Many Bank investments provide for capacity building in policy reform, investment planning, program design, implementation, and evaluation. ',he Bolivia Integrated Health Development Project will support and guide the government in the rationalization of health sector planning, policy making and investment planning and in the development of a plan of action, which will permit an annual review of program performance using specific indicators and targets. Under the Lesotho Population Health and Nutrition II Project, the government will be supported in the development of a national population policy and in the development of policy reforms in health financing and the role of PVOs in service provision. The Thnzanian Government will strengthen its capacity in planning, policy formulation and implementation under the Health and Nutrition Project.
9 15. In addition to benefitting from direct project support, capacity building and policy reform also occurs as an outcome of the process of sector dialogue and project implementation. For example, the Morocco Health Sector Investment Project is building on studies of financing and hospital administration, which were financed under the first Health Development Project. Follow-up by the government includes a major decentralization of hospital administration, financial control and fee collection, and wide-ranging reforms of the entire sector. These will be discussed at the government's second annual National Conference on Health Financing, where the potential reforms to be discussed are expected to include greater use of private sector health insurance, changes in the role of the social security system and that of the public health services in the provision of care, and modification of the investment code (linked to the Bank's economic work) to facilitate investments in private sector practice. Successful policy reform, which may occur as a result of this process, will provide a useful model for other countries and regions in the world.

# Management/lnstitutional Development

16. Recent Bank investments reflect an increasing appreciation of the unequivocal importance of developing institutional capacity and sound management skills and practices in achieving PHN sector objectives. Virtually all PHN projects approved in FY90 include some provision for improving efficiency of programs and services through management strengthening interventions. Accompanied by the program approach described above (paras. 13-15), there has been a further and much-needed evolution towards a program (vs. project) management approach in Bank investments in the PHN sectors. In other words, Bank-financed management interventions are less concentrated than in the past on ensuring the effective implementation of a Bank-financed project in isolation, and more concentrated on the effective and efficient implementation of major policies and programs, whether Bank-supported or not. Virtually aU projects have taken great care to ensure that the overall responsibility for project management and implementation rests with the appropriate line Ministry. The Yemen Health II SAR emphasizes this point by noting the very difficult and problem-ridden implementation of the Yemen Health I Project, which was attributable in part to the isolation from the Health Ministry of that project's management unit. Responsibility for oversight and coordination of the Morocco Health Sector Development Project is placed under the Planning Division in the Ministry of Health.

17. Key management/institutional development issues in the PHN sectors are numerous and complex and are crucial to achieving improvements in PHN sector performance. Salient management topics which should be addressed through Bank's project and sector work include: policy implementation and management; implementation of decentralized policies within the health sector, management and organization of services of the MOH; use and maintenance of MIS; management capacity building; inter-ministerial/inter-agency coordination; cofinancing and aid coordination; budgeting and financial management; management and delivery of services at the periphery, supervision; management and coordination of private sector and NGO activities. The list is not exhaustive, but iUustrates the complexity of needs analysis work and of the design and implementation of appropriate interventions in this area. There is some variance in the degree to which Bank interventions have attempted to address these issues. A number of interventions to strengthen the management of an institution or part of an institution are limited to the provision of training, technical assistance, additional staff and equipment, and have not rigorously addressed more difficult and sensitive issues such as: the organizational structure of ministries and of the programs and service delivery systems; the extent to which such organizational structures respond to decentralization policies; problems of inter-agency coordination and territorial issues. There are, however, notable examples of projects which have addressed these issues fully and squarely. The Nigeria Essential Drugs Project is supporting O!ic restructuring and consolidation of institutions responsible for the pharmaceutical sector at the
10 federal and local levels. The institutional development component of the Haiti Health and Population Project makes provision for the restructuring of the Ministry of Health and Population for the effective implementation of decentralization policies. An organizational analysis and support for decentralization of the Colombia Institute for Family Welfare will be supported under the Colombia Child Care and Nutrition Project.

18. In order to encourage and guide a more comprehensive and successful intervention in the management/institutional development of PHN, efforts should be made by PHRHN to undertake an in-depth review of PHN projects with this focus in mind to document successes and failures, develop guidelines and provide for exchange of knowledge and experience in this area through seminars or workshops.

# PHN Financine

19. Bank investments in the PHN sectors are supporting in general much larger proportions of rer!urrent cost components than they have in the past. This shift has most certainly been influenced by the nature and scope of recent PHN dialogues, which address economic austerity issues and acute budget constraints seriously jeopardizing the sustainability of new investments. The focus of Bank work has been on improving the effectiveness and efficiency of priority activities and services, while expanding them prudently when their financial sustainability could be reasonably assured. Consequently, the content of PHN operations approved in FY90 reveals the allocation of significant proportions of Bank funds to recurrent costs, particularly drugs, contraceptives, supplies and salaries, and relatively small proportions to investment costs (civil works and equipment). A sampling of such projects is documented below:

- (a) Over one-half of the total cost of the Thnzania Health and Nutrition Project is for recurrent costs, of which 80 percent is for pharmaceuticals and medical supplies.

- (b) Recurrent costs, comprised mainly of nutrition supplements, salaries and drugs, account for about two-thirds of the total cost of the Second Thmil Nadu Nutrition Project;

- (c) For the Morocco Health Sector Investment Project, drugs and supplies constitute a larger cost item than civil works;

- (d) As its name indicates, the Nigeria Essential Drugs Project is dedicated entirely to ensuring a constant and affordable supply of essential drugs in support of the government's newly pronounced Essential Drugs Policy. Sixty percent of the total project cost or US$39.7 mil;'-n will provide for a drug seed stock.

20. A formidable challenge posed by Bank investments in the PHN sectors lies in ensuring their financial sustainability, i.e. (i) minimizing the PHN recurrent cost burden through efforts to rationalize services in order to achieve cost-effectiveness and promote cost containment; and (ii) mobilizing resources through newfimproved cost recovery mechanisms and through cofinancing and aid coordination activities channelled into national policies and programs. In addition to the recurrent cost financing issues raised above, rapidly escalating investment costs also present a major financing issue, especially with respect to the hospital subsector. The Bank continues to address these issues actively in a search for optimal solutions, as evidenced by the regional and national targeted sector work undertaken and ongoing in FY90 (paras. 11 and 4445), and project components dedicated to such issues as cost-effectiveness of health investments, health flnancing, financial management, cost recovery, and the like. There are numerous examples of such project-supported efforts. Morocco Health II supports an increase in cost recovery for curative care; mobilization of additional resources; streamlined arrangements for
11 services funded by public and private insurance funds. The Haiti Population and Health Project provides for the rationalization of cost recovery mechanisms; containment of salary expenses; further study of cost recovery policies. Under the Tbnzania Heath and Nutrition Project, a plan of action will be prepared on the long-term financing of the health sector and a reallocation of the public budget to health will be undertaken. The Lesotho Population, Health and Nutrition II Project will support policy reform to increase cost recovery activity and revenues and to improve expenditure efficiencies. Given the Bank's advantage in terms of expertise in economics and finance, scope and quality of dialogue with governments, and the leverage it possesses at the macroeconomic level, particularly with SALJSAC operations, it should continue to take the lead in researching and resolving health financing issues, both through practical experience in operations and through research work at the national, regional and worldwide levels.

# Roles and Responsibilities in the Manaeement of Social Development Projects

21. The collective experiences of Bank staff involved in the six social development projects approved in FY90 (paras. 8.10) have provided useful insight on issues regarding task management and coordination of projects with a multi-sectoral focus, which are an emerging trend in addressing human resources development issues. Projects which integrate PHN and Education sectors often emanate from human resources development dialogues initiated at the macroeconomic level. The coordination of education and PHN inputs is easily managed by PHR divisions, according to experienced PHR staff, particularly if the Bank-Government dialogue has resulted in the elaboration of a human resources development strategy or program on which such a project is based. Staff do state, however, that, in order to sustain and streamline the necessary communication with several line ministries in the design and implementation of such a program, it is advisable to appoint an agency in the country (planning institute, for example), responsible for human resources development, to coordinate and facilitate the dialogue between the Bank and the various line ministries.

22. Social development projects, which focus on sectors both within and outside of PHR divisions' responsibilities, can be successfully managed and coordinated by PHR divisions and by non-PHR divisions, alike, based on FY90 experience. Staff involved in such operations insist that the key to successful project design, development and implementation lies not only in consulting and communicating with various sector divisions, but by intimately involving them in, and making them responsible for, the full range of tasks for the appropriate sector component(s) (i.e., policy dialogue, program and project design, and supervision). An example of such coordination which has proven to be particularly successful is the Uganda Poverty and Social Costs Project, which is managed overall by the COD (the resident representative, in fact) but sectoral components are fully and clearly delegated to the sector divisions. Anything less than such full involvement and clearly delegated responsibilities of key staff can result in conflicting and/or confusing dialogue; Bank investments which are not fully supportive of sector strategies; poorly designed projects; and suspicion or even cynicism among staff about future collaboration. It should be qualified that the observations above emanate from experience gained thus far in the processing of social development projects. Careful monitoring of the execution of these projects is in order to ensure that coordination among the various divisions remains optimal and effective.

# Non-Govemmental Organizations

23. Another welcomed feature of the FY90 projects is the considerable effort to involve NGOs and local institutions in the design and implementation of PHN operations. In the past, NMOs were typically involved in activities such as information, education and communication (IEC), and very often this component was financed by a grant from a cofinancier, e.g., Sri Lanka, FY88. In some regions their role has evolved further, and NGOs are now playing an
12 important role in service delivery. This is the case in Bank-financed projects in the Africa region, and in the India project. In Haiti, health NGOs were involved in the consultations leading to project preparation. While a number of NMOs have worked in the EMENA region for many years, particularly in the Levantine countries and the Yemen Arab Republic (where one was involved in the Bank's first health project), tb.--. ave not, traditionally, been a common, or well-accepted, part of the political or social pocess. NGOs linked to the distribution of food aid did make a valued contribution until recently, but these programs have been much reduced or phased out in the last few years, partly because food aid is now handled primarily by the World Food Program. NOOs indigenous to the area are relatively new and smaii, and the Bank has not yet found ways to involve them in Bank-assisted projects.

24. In the Africa region, where government health services may reach less than half the population, NGOs have long played an important part in providing health, and more recently, family planning services. Recognition of this contribution has led the Bank to greater efforts to involve NGOs in Bank projects, efforts which have necessitated dialogue with governments to overcome some of the difficulties involved in this process. NGOs play an integral role in a number of FY90 approved projects in the Africa region, with substantial population components. In lbnzania, the Ministry of Health and UMATI, the family planning association of Tanzania, take joint responsibility for population and family planning activities. In Kenya, wl'ere the recent Demographic and Health Survey revealed that NGOs and other nongovernment providers account for almost 30 percent of family planning services delivered, government support for NCOs has been strot.6, and the project again finances improvements in service delivery and quality through NGOs. In Lesotho, two health and family planning NGOs are identified as beneficiaries of the project, together with the MOH. In The Gambia and Cameroon, too, NGOs are assisted through the project: in The Gambia to strengthen community-based distribution, and in Cameroon by way of cofinancing from USAID. In India, the government has for some time recognized the contribution of NGOs, and has put in place a system for grant assistance. The seventh project contains a very substantial component to strengthen NGO involvement (Annex 4, para. _5)._ 25. The Population NGO Special Grants Program (para. 38), administered by PHRDR, has complemented this process by its strategy of stimulating collaboration in Africa between governments and NGOs, and strengthening technical and administrative capacity in NGOs. Other questions regarding the increased use of NGOs are being addressed by research in the regions and in PHRHN. For example, a study of the sustainability of NGOs is being undertaken through the Third Kenya Population Project -- an important issue in Kenya, and in other African countries, since the major part of NGO funding is coming from external sources. The issue will also be addressed in the sector work on alternative channels for family planning being done in many of the Africa sector operating divisions. In India, a study of NGOs produced jointly by the National Institute for Health and Family Welfare, and the Bank', addresses questions of technical capacity in NGOs, the organizational arrangements for managing collaboration with NGOs at the government level, the administration of grants, and alternative mechanisms for channelling technical and financial support to NGOs. The policy paper now underway in PHRHN, addressing Family Planning Program Effectiveness, is also examining the role of NGOs, and the implications for national programs. (This study is described more fully in Annex 9 paras. 9-13).

> t *Strengthening the Role of Non-Governmental Organizations in the Health and Family Welfare Program", produced in Green Cover, June 1990
13

# Methods of Carrvine Out Project Desi,en and Implementation. and Sector Work

26. Experience has shown that the involvement of regional experts, practitioners and beneficiaries in needs assessment and in project design and implementation contributes to a significantly improved product, which is more responsive to needs and priorities and more appropriate to the political, cultural, traditional, logistical and economic context of the country in question. In addition, the success and sustainability of initiatives emanating from such a prceess are much more likely, with the commitment and sense of ownership such a strategy stimulates, which are otherwise difficult, if not impossible to elicit. Notwithstanding the often strongly country-specific nature of wonsumer preferences (and hence of appropriate programmatic and institutional solutions to PHN problems), the employment of experts coming from the same region but not the same country, can be extremely useful. Not only might they supplement a possible short supply of local expertise and/or strong community institutions, they also permit an exchange of regional expertise and experience, which has great potential for resolving country-specific issues which may be comrnmon to a region and for stimulating a regional dialogue from which all participants could benefit. The Africa region, in particular, should be cited for having fruitfully employed this strategy in the course of its work. AFTPN's success in establishing and effectively utilizing a Population Advisory Committee comprised of African experts is noteworthy, and has resulted in a commitment and partnership between the Bank and key Africans in the promotion and expansion of population activities in Africa. The initiative of AFTPN and PHRHN to elicit the input of African health experts in the African Health Policy Study, through a series of regional workshops, also deserves mention. The Lesotho Population, Health and Nutrition II Project is innovative in its successful efforts to involve service providers in the project design; and the efforts to .1rengthen community participation in the design and management of PHN interventions in Benin, Guinea, Cameroon and Togo are noteworthy and provide useful examples upon which other such efforts could be built.

27. Given tight schedules and constrained budgets, it is understandable that, while appreciating the benefits of such a strategy, staff might be inclined to avoid this approach, the costs and risks of which are perceived to be hign. Wider employment of this strategy in PHN is recommended by such means as: the producticn of case studies and/or guidelines to facilitate its implementation; creation of rosters of developing country PHN experts; a change in incentive structures to reward this approach, such as the acknowledgement and reward of such efforts through the PPR process; the creation of special funds from the Bank's administrative budget to cover the costs of very well designed and defined, short- or medium-term internships for Third World experts who never have worked with the Bank, to name a few.

# Cofinancin, and Aid Coordination

28. In an effort to ensure full implementation of human resources deveiopment policies, sttdtegies and programs, Ba1ik staff are making greater efforts to attract, consolidate and rationalize the flow of external resources into the PHN sectors, in direct support of program implementation to maximize cost-effectiveness of such investments as well as to mobilize more resources for the sectors. Some efforts to this effect have resulted in formal, and sometimes expansive, cofinancing arrangements for projects/programs initiated by the Bank (e.g. Bangladesh Population I, 11 and III Projects), while others culminated in much less formal and looser (no guarantee) agreements with donors for parallel or complementary financing of strategies or programs. As discussed in paras. 6 and 9, the Bank has had some success in attracting the support of aid donors for the PHN sectors. This demonstrated potential for raising cofinancing should be exploited, given the great need for increased financial resources for PHN sectors, as weil as the equally important need to ensure a rational allocation of resources flowing into the
14 sectors within the context of a sound policy framework and well-organized and targeted programs. On the other hand, the costs (in staff time, particularly) of coordinating such aid can be significant. The development of governments' capacity to assume cofinancing and aid coordination responsibilities has not always been given due emphasis in such sector/program investments. While it is beyond the scope of this report to assess cost and benefits of various approaches to cofinancing and aid coordination by the Bank, it is an issue which warrants further scrutiny, given the urgent need, at least for the medium-term, for an increased flow of external resources into the PHN sectors. In the meantime, cofinancing and aid coordination activity in the population sector, described immediately below, illustrate the benefits of such efforts.

29. The Bank, led by AFTPN, and other donor agencies are joining together to support the efforts of African countries in population. This initiative, the "Agenda for Action to Improve the Implementation of Population Programs in Sub-Saharan Africa in the 1990s' is now underway, and will produce a program for the 1990s and beyond. Cosponsors of the initi. tive are the Bank, UNFPA and IPPF, and it is also supported by WHO anti thc African Development Bank. The involvement of this last institution is especially encouraging. Since the Berelson Report of 1976 on the Bank's Population Activities, the suggestion has been made that the Bank might draw the regional development banks into the process of population policy development - their close ties with their own regions making their support potentially very influential - but these are probably the first steps in this direction. In addition, not only will the Bank be working with other agencies on this initiative, but every effort is being made to involve African experts, and government representatives. These developments at the regional level are reflected in the design and financing of projects. The FY90 projects in Africa all involve a high degree of coordination among donors in support of population and family planning activities. In some cases the Bank has taken the lead in mobilizing and coordinating support, e.g., in Lesotho; in others it plays a supportive role, e.g., Kerya, Tbnzania and Cameroon. Several donors have come in as cofinanciers of the FY90 Bank projects. Indeed, in several cases, it is their grant assistance that has made a population component possible, or has increased the range of population activities financed under the project, particularly with respect to policy development -- in Cameroon, The Gambia and hnzania, for example. In Chad, too, birth spacing will be supported as part of the strengthening of health services, partly under the Bank loan, and partly under a donor grant.

30. Considerable donor coordination on population matters is also evident in the FY90 projects in other regions, though there are fewer cofinanced projects. In India, several multilateral and bilateral donors have provided support for many years to the Family Welfare Program. The Bank supports some states, for example, and other donors provide support in other states. In EMENA, the Morocco project seeks to strengthen basic health services, including MCH and family planning, and, in order to ensure complementarity and reduce duplication, has been designed in close collaboration with USAID's US$30 million Family Planning and Child Survival Project, begun one year ago. It also seeks to complement UNFPAs annual expenditure of US$3 million on population activities. In the Yemen Arab Republic the government's population activities are primarily supported by UNFPA and USAID. In the LAC Region, the Haiti project seeks to strengthen family planning and MCH by equipping institutions, providing training and IEC. UNFPA provides the government program with contraceptives. Population policy development is being assisted by UNFPA and USAID.

31. In addition to facilitating donor coordination, cofinancing offers several other advantages, as described in Annex _5._ paras. 17-22 in relation to the Bangladesh population program. The impact of Bank lending is increased by its association with other donors, most of which offer grant assistance to population, and some of which do not have the technical resources to
_15_ provide independent population support, but welcome the opportunity to contribute through a Bank-managed project. The project, too, often contains population modules that otherwise - might be difficult to lend for especially the kind of consensus-building activities, workshops etc., apd setting up of population units and coordination mechanisms -- that are so important in policy and program development, but which, in countries where there is little existing demand, must precede the expansion of family planning delivery services.

# POPULATION

32. The categorization of population as a sector and its grouping in the Bank with the health and nutrition sectors have clouded an important issue, which has constrained somewhat the Bank's potential for making urgently needed gains on the population front. Rapid population growth has a dramatic impact on the economic development prospects of many countries. As such, not only must the issue of population giowth be fully appreciated by staff, who carry the responsibility for macroeconomic and structural adjustment dialogue and operations, it must be rigorously addressed by them as a crucial and integral part of their responsibilities. Family planning, while an obvious and important intervention in support of abating population growth, is Pot the only intervention at hand. Levels of education, employment, urbanization, the status of women, to name a few, constitute some of the other factors, which determine actual and desired family size. These determinants of population growth, therefore, need to be more rigorously addressed at the macroeconomic levels, as well as by the sectoral staff, whose policy and operational interventions could have some impact on these factors. A second challenge, which the Bank -- PHN staff in particular -- is facing L to increase the volume and effectiveness of family pianning rrograms in the face of their various stages of development (from wellestablished programs, whose gains are beginning to plateau, as in some Asian countries, to new or nascent programs, which are not yet effectively meeting demand, which are in need of basic organizational and design assista.ice, and which are emerging with, and sometimes without, officially pronounced population policies, as in most African countries). The Bank has not yet reached its full potential for effectively and comprehensively addressing all facets of the population issue. It has, however, made notable strides during the fiscal year to this effect, which are described below.

33. While most regions are moving towards the drawing up of regional strategies for population, the Africa region has progressed furthest, and last year produced its short-term program for FY90-92z, and for the longer term is collaborating with other donors and governments on 'nThe Population Agenda" mentioned above. The Task Force was established by the Africa Regional Management Tbam at the end of 1988. The Country Departments (CDs), in consultation with the Task Force, prepared Country Action Plans for discussion with the national governments. The CDs identified a group of countries for priority activities on the basis of selected criteria and pending further discussion with governments. The actions proposed and their objectives are determined by the demographic situation and status of the population and family planning program in each country. The Bank's future operations, within the Action Program, will be guided by "(i) a broad definition of a population program, which would include measures to change attitudes towards family size, such as through improved education, changing taxation and inheritance laws, and cost sharing for social services; raising age at marriage; reducing infant and child mortality, and regulating population distribution and migration: (ii) a distinction between a population and family planning program, the latter being 2 Report of the Africa Region Task Force on Population FY90-92, Volumes I and II, November 1989
16 only one element of a population program; (iii) provision of high quality family planning services as widely as possible through well-developed health systems and other channels; and (iv) suppora for elements of a population program in countries which do not yet have an official population policy or program"<sup>3</sup> . The country action plans set out programs for policy dialogue, economic and sector work that include more rigerous treatment of population issues, integraticn of population activities into SALS and SACs, into social development projects and non-PHN projects, as well as for traditional investments in the PHN sector, 34. An interesting feature of the process of developing the Program of Action is the extensive discussions which took place among the Country and Sector Operating Divisions, a dialegue which has helped the integration of population issues into the development of country strategies. Another interesting feature of the TAsk Force's work is its liaison with outside agencies, many of which were represented at Task Force meetings -- USAID, the Population Coundcl, and Fahmily Health International, for example. Third, the Task Force took into account views on population issues expressed by the Population Advisory Committee at a meeting in mid-April 1989. This committee, comprised of a group of African population experts and senior policvmakers, has been formed to advise on the development of "The Population Agenda', the multi-donor initiative mentioned above.

35. In Asia, a Population Sector Study will be produced in FY91. A preliminary note<sup>4</sup> has suggested that the Bank is maintaining its program in the region with its major borrowers -- India, Indonesia and Bangladesh -- but must prepare itself to meet the changing demands of those countries, and could be doing more to generate demand in countries where family planning programs are at an early stage of development. In these latter countries there is a need for more targeted economic and sector work, to explore the economic-demographic relationships in those countries, and the possibilities of donor coordination. In the wellestablished programs, budgets are not increasing fast enough to keep pace with demand for family planning; USAID's role in contraceptive supply is at best stable, and may be reduced, resulting in increased demand for Bank resources for contraceptive procurement. The note classifies countries in the region according to their demographic chaiacteristics and program history and suggests a differentiated Bank strategy.

36. In EMENA, family planning in Bank projects has been carried out through the health system. In some parts of the Middle East this reflects traditional attitudes towards population and family planning issues. In the Maghreb countries, however, there is growing acceptance of the need to consider demographic variables in economic and human resource developmenL The Maghreb division produced two reports in FY90 which provide this movement with important theoretical underpinning.<sup>5</sup> In LAC, many countries remain very sensitive on population matters, but have accepted the importance of family planning as a health intervention. Sector work in the region does much to reinforce this importance, the FY90 Brazil study on Women's Reproductive Health being a case in point.

37. Research work currently underway in the PHRHN division will help to inform some of the issues that the operating divisions and TDs in the regions are grappling with in the 3 Ibid, Executive Summary, para. 3.

4 "Asia Region: Discussion Note on the Population Sector" June 29, 1990 5 "Morocco. Reaching the Disadvantaged: Social Expenditure Priorities in the 1990s", and for the Maghreb, MThe Dcmographic Challenge to Sustainable Economic Development"
17 formulation of country strategies. Work on the Determinants of Fertility Decline and Contraceptive Prevalence will help evaluate the place of family planning programs in human resource development; the extent and nature of the secial development that affects demand for family planning, and the interventions that would be mutually reinforcing. The research on FPmily Planning Effectiveness, already mentioned in connection with NGOs, will also address issues of what structures and implementation mechanisms are most appropriate at different stages of a country's program development and fertility transition.

38. In LAC, EMENA, and Asia, regional strategy is develop;ng more slowly than in Africa. Mechanisms such as the Task Force are not emerging. One reason might be that Africa is the one region which has a separate PHN lbchnical Division, whereas the others do not. Unless there is a sufficient number of peaple experiencad in population in the TDs to promote and monitor the development of regional strategies and priority action programs, with all that this involves for economic and sector work and policy dialogue, it is unlikely that this will happen - SOD PHN staff being too involved in their own country work. At present, population professionals in the TDs are all too often so much engaged In providing support in the appraisal and supervision of country projects, and in country ESW, that there is very little opportunity left to draw back and take a regional view.

39. lbtal Bank lending for population amounted to just under $170 million in FY90, an increase of _35_ percent over the previous year (Annex 6). 'Iwo projects were "free-standing" population projects -- Kenya Population IV and India Population VII, and six others made substantial provision for family planning (Annex 7). The two "free-standing* projects accounted for 78 percent of population lending, indicating the heavy deper.dence of the program, in dollar terms, on this type of project. In FY89 and FY88 the proportions were 99 percent and 88 percent respectively. The lesser proportion in FY90 is due to the larger number of combined projects. Including the "free-standing" projects, eight out of 12 PHN projects contain a population component in FY90, compared with 4 of 11 in FY89 and 5 of 8 in FY88. While there has been ar increase in lending for population, its share of PHN lending is slightly down, from 23 percent to 21 percent.

40. Lending in the Asia Region, where the Bank has long been supporting large-sca!e national family planning programs formed, as usual, the mainstay of the population lending program. Here, the convention by which such projects are considered 100 percent population tends to overstate somewhat lending in the sector. In India, for example, there has been a major effort to make maternal and child health services a more equal partner in the Plmily Welfare Program -- both as essential in their own right, and as an important contributor to reducing fimily size desires. In the Africa region, where, with the exception of Kenya, the Bank has been involved in PHN only since the early 1980s, the strength of effort being put in is beginning to be show results. The only project without a family planning component is the Nigeria Essential Drugs project, and population lending represents nearly one third of PHN lending in the region. The Fourth Kenya Population Project, which primarily supports contraceptive supply, entered the FY90 program as a quick Bank response to the dramatic, and unexpected, acceleration in demand for family planning. In the second PHN project in Lesotho, the family planning component is valued at 10 percent of the total credit as compared with 3 percent in the first project. In Thnzania, the Bank is making its first investment in the sector. In LAC and EMENA, the Bank approach continues to be to ensure the provision of family planning within health services, and is reflected in the solid showing of family planning lending in these regions' FY90 PHN programs.

41. While defining the India project as totally "population" inflates the estimates of population slightly, this tendency is more than offset by the fact that many other features of the
18 combined PHN projects support the provision and management of family planning services -- joint costs incurred in training, building management and information systems, supplying equipment and drugs, constructing and rehabilitating clinics, and so on -- features not fully accounted for in the estimates for population lending given here. In addition, social development projects in Cameroon, Chad and The Gambia include population components,. The assistance given by the Bank has, moreover, been greatly magnifled by increasing coordination with other donors at many levels of aid -- from cooperation in the design of assistance to a region, to division of labor in support to country programs, to cofinancing of projects.

42. The encouraging news for the population sector in FY90 lies more in the number and geographical range of the projects than in the amount of lending alone, though this too was up, and more projects showed substantial support to population than was evident last year. The stimulus to population activitics given by cofinancing, particularly in social development projects, has also been .ery encouraging. This overview of the population sector has concentrated on themes that have run through the FY90 program - increased donor coordination, increased use of NMOs, and increasing integration of population into country development strategies. As stated earlier in this section, the full and rigorous treatment of population as a macroeconomic issue remains a challenge for the Bank. Another emerging issue is that of meeting the increased demand for contraceptive supply. The growing numbers of governments providing family planning services, and the growing number of women of reproductive age, taken together with USAID's warning that it cannot continue to underwrite contraceptive supply indefinitely, implies increased demand for Bank resources in this area. In fact, the larger question, vithin which the commodity issue lies, is that of the almost inevitable demand for increasing Bank support, given the stagnant level of funding from other sources.

# HEALTH

43. Sector work and PHRHN research make clear that the following factors, among others, present a formidable challenge to Bank staff responsible for health sector development work in the Bank in the 1990s:

- (a) Demand for health projects is great and growing, stimulated by the high priority placed on human resources development objectives by national govemments and the World Bank;

- (b) Weak institutional capacity severely constrains the potential of govemments to translate policy into appropriate programs and to effectively manage their financing and implementation.

- (c) The epidemiological and demographic profiles of countries are evolving (albeit at various stages of evolution, depending on the country/region) towards a disease burden, whose composition is shifting away from infectious and parasitic diseases and undernutrition, whose main victims are children, to non-communicable disease (e.g. cardiovascular disease and cancer), which largely affect adult populations. The emergence of AIDS has also significantly affected national and regional epidemiological profiles and priorities. Thus the choice of target populations, as well as of priority interventions for Bank investments, is not an easy one.

- (d) Constrained resources for the health sector render priority-setting crucial, and call for efforts to maximize sector efficiency and to mobilize additional resources for
19 health (through cost recovery schemes, aid coordination/cofinancing efforts, and rationalization of national nealth budget allocations and expenditures).

- (e) The involvement of private sector and NOOs in the delivery of health care is increasing in many countries, calling for efforts on the part of national governments to coordinate and regulate this essenti ll contribution to health sector development, with a view to maximizing its utility.

- (f) Hospitals and lower-level urban health facilities are increasingly (and correctly) appreciated as an integral part of a viable primary health care (PHC) system, rather than being perceived as competitors for resources with rural PHC facilities, resulting in the devotion of some Bank time, effort and resources to improving the management and efficiency of hospitals and to the strengthening of urban PHC facilities. Over and above an appreciation of the role of hospitals in PHC, Bank involvement in the hospital sector has sought to increase their internal efficiency, contain costs and restrain unjustified growth, given that hospitals, in many settings, consume a large proportion of scarce resources.

- (g) Increased interest and attention is being accorded to the poor state of maternal health and to the need for cost-effective Safe Motherhood initiatives, resulting in a growth in demand for assistance in this domain.

- (h) Chronic shortages of essential affordable drugs continue to constrain the quality and credibility of public health services.

44. Project and sector work undertaken during FY90 made a noteworthy effort to meet these challenges. In addition to the growing numbers of reports and operations produced to effectively meet a growing demand for health operations (Chapter II), the content and focus of lending and sector work addressed these issues in a number of ways, as discussed below.

_45._ A significant proportion of sector work undertaken during the year (including tasks still in process as well as completed tasks) accorded some of these issues a single focus, in an effort to further understanding of these issues and an appreciation of how to address them effectively in operations. Seven sector tasks focus exclusively on AIDS, nine on financing issues, three on women issues/Safe Motherhood, one on long-term health issues, one on NOOs. In addition, these and other pertinent issues raised above were addressed in the 20-plus sector tasks, which were more broadly focused on population, health and/or nutrition sectors. The relatively recent creation of Technical Departments has encouraged and facilitated the production of sector work with a regional focus. Such work has provided valuable insight and perspective on current sectoral issues and challenges. Examples produced or initiated during FY90 include: (a) for Africa: AIDS Resource Allocation (Phase I); Africa Health Policy Paper, Health Financing; and Review of Pharmaceuticals; (b) for Asia: Financing of Social Services; and Poverty and Health Services; (c) for EMENA. Demographic Challenge to Sustained Economic Development; and (d) for LAC: Social Security in Latin America: Issues and Options for the World Bank.

46. Project work was equally responsive to many of these issues, including:

- (a) special components on AIDS (e.g. Haiti Health and Population; Tbnzania Health and Nutrition; Lesotho Population, Health and Nutrition II);

- (b) explicit and widespread (across projects) focus on reproductive health intcrvcntions (most notably the MCH component in the Brazil Health Project which draws heavily
20 on the FY90 sector report on Women's Reproductive Health in Brazil, and also the Bolivia Integrated Health Development Project, India Population VII and Nutrition 11, to name only a few);

- (c) investments to improve hospital management and efficiency and strengthen urban services (Lesotho Population, Health and 1.utrition IIL Yemen Health 11);

- (d) significant Investment in drug supplies (Nigeria Essential Drugs);

- (e) emphasis on institution building (e.g., Haiti Population and Health, Nigeria Essential Drugs, India Population VII, and Morocco Health);

- (f) important resource allocation and mobilization initiatives (e.g., Tanzania Health and Nutrition, Haiti Population and Health, and Morocco Health); and

- (g) coordination with NOOs (e.g., Lesotho Population, Health and Nutrition II).

47. Research and policy work undertaken in PHRHN during FY90, as descnbed in Chapter IV, also contributes to the exploration and resolution of salient health issues outlined above.

# NUTRMON

48. Bank support of nutrition activities, both including and in addition to PHN operations, has expanded significantly. Lending in FY90 totaled approximately $150 million for four operations in which nutrition was the principal focus (India ibmil Nadu Nutrition II, bnzania Health and Nutrition, Colombia Community Child Care and Nutrition, Jamaica Social Sector Development). This compares to $50 million and two operations during the ten year period FY80 to FY89. In addition to these four significant operations, seven of the other nine PHN and four of the other five Social Sector projects, approved in FY90, support nutrition components. Other FY90 approved Bank operations which provide for nutrition activities include: three agriculture sector adjustment operations (Mala-wi SAC, Mali Agriculture SECAL, Mauritania Agriculture SECAL); three education operations (MaIdagascar Education Sector Reinforcement, Bangladesh General Education, Pakistan Sind Pr;maqy Education Development); and five structural adjustment operations (Sao Tbme & Principe SAC III, Senegal SAL IV, Sri Lanka Economic Restructuring Credit, Algeria Economic Reform Loan, Thnidad & Tobago SAL 1). The pipeline for future ope,rations is strong, as well. Nutrition lending is expected to approach $200 million for three major projects in FY91, and exceed $500 million for at least six major projects in FY92. When counting nutrition components in projects in other sectors and the nutrition portion of adjustment projects, lending for nutrition for the period FY90-92 is expected to exceed $1 billion.

49. India continues to account for the largest volume of free-standing nutrition lending. Tamil Nadu Nutrition II will extend the successful Tamil Nadu pioneer project from the original 9,000 villages to all of that State's 20,000 villages. A new project tied to India's Integrated Child Development Services (ICDS) program (approved in September, 1990, $106 million) will extend Bank nutrition assistance to two new states, Orissa and Andra Pradesh. Also in the region are free-standing nutrition projects (or projects in which nutrition will be a main theme) in various stages of preparation, for Bangladesh, Indonesia, the Philippines, Sri Lanka and, again, India.

_50._ LAC has the most broad-based nutrition program of the Bank's four regions. Most significant in FY90 are the innovative Colombia Chi.d Care and Nutrition project and the
21 Jamaica Social Sector Development project. Smaller nutrition components are supported in the two Bolivia projects (Social Investment Fund and Integrated Health Development credits), Brazil Northeast Basic Health II, and Haiti Health I. An Argentine request for a $200 million Social Emergency and Adjustment project (85% nutrition) may result in the Bank's largest nutrition operation to date. The Venezuela Social Development and Nutrition project prepared in FY90 ($105 million) will support food and nutrient supplementation programs through health centers, and targeted nutrition programs for primary and preschools. Projects in which nutrition will play a major role also are being prepared for Brazil, Ecuador, Guatemala and Mexico.

51. In addition to the Tbnzania Health and Nutrition project, FY90 lending in Africa supports nutrition components in Lesotho PHN II, Chad Social Development Action, Gambia Women in Development, and Uganda Poverty and Social Costs. One of the largest nutrition activities in Africa has been the Bank's food-security initiative. In FY90 food security studies were completed for Kenya, Mozambique, Malawi, Benin and the Sudan. The first of this group of studies was Kenya's Food and Nutrition Policy Sector Study. In addition to analyzing malnutrition and food insecurity at both the household and individual levels, this study proposes several options for direct nutrition interventions including targeted fortification in specific regions at high risk for micronutrient deficiencies. The first free-standing food security operation in the Bank will be undertaken in Cameroon in early FY91. Included is a nutrition education program linked to efforts to improve the purchasing power of high risk households. Also under preparation is a free-standing Food Security and Nutrition project for Madagascar.

_52._ The two PHN projects approved in EMENA in FY90 also address nutrition. A significant portion of the Morocco Health Sector Investment project will support nutrition activities including growth monitoring and food and micronutrient supplementation, while the Yemen Health II project will significatnty increase human resource capacity in nutrition through training. In the pipeline, a large nutrition operation is under discussion as part of a forthcoming Social Costs of Adjustment credit in Egypt, and a proposed Safety Net Program for Morocco will emphasize improving food and nutrition programs. EMENA has taken an active role in the recent Bank effort to design ways to improve primary school performance through alleviating malnutrition and hunger in students. The FY90 Pakistan Sind Primary education project will test whether a school feeding program can improve nutrition status, increase enrollment and enhance student achievement. Nutrition components in primary education projects designed to address the "teachability of children in an effort to improve education efficiency arc also under preparation in Africa (Mozambique, Burkina Faso) and LAC (Brazil, and the Dominican Republic).

53. Nutrition was featured in several PHN sector studies and addressed in numerous other Bank documents published during the year. Refer to Annex 8 for the complete list of nutritionrelated sector and research work. Below are some of the highlights from this broad range of work.

54. Both the Thnzania and Mozambique PHN sector reviews induded detailed analyses of the nutrition situation in these countries. In TInzania the call was to adopt a national nutrition policy to elevate nutritior. considerations in agricultural policy and for interventions to change infant and child feeding practices talkng into account women's domestic labor burden. For Mozambique, recommendations were for growth monitoring, well-targeted food distribution and nutrition education programs, as well as for improvements in the targeting of food aid to vulnerable groups. Subsequent, significant nutrition operations are currently underway in each of these countries. In China, a Bank study of that Government's general urban food subsidy program showed how costly it has been and how its basic objectives could be met, at far lower cost, through a revised program based on targeting. Also on targeting, tle Morocco Poverty
22 Study devoted chapters to both nutrition and food subsidies, and concluded that the food subsidy program is not targeted to groups at high nutrition risk, and policy reforns will at best protect the income of some beneficiaries of current policies but wiU not do anything about structural nutrition problems. The Social Safety Net project is expected to flow from this analysis.

_55._ A Bank Discussion paper on nutrition published during the year, 'Improving Nutrition in India," identifies that, despite substantial progress towards evolution of a nutrition policy in India, the distribution of nutrition expenditures has been insensitive to the observed regional variations in malnutrition. Adoption of a regional approach to nutrition planning is called for, as well as efforts to strengthen the nutrition data bases to encourage the design of interventions - appropriately molded to accommodate regional variations. The report *Fighting Malnutrition An Evaluation of Brazilian Food and Nutrition Programs' reviews Brazil's long and varied experience with emergency nutrition programs, and suggests that many of the constraints to effective nutrition interventions are operational rather than conceptuaL A Bank lbchnical Paper also published during the year, "Helping Women Improve Nutrition in the Developing World: Beating the Zero Sum Game, draws attention to the linkages and competition among women's life roles, and suggests that women's time constraints may partially explain poor participation rates in many developmcnt projects. The report offers suggestions for using an analysis of women's roles to address nutrition problems in developing countries. Another technical paper 'A Case for Promoting Breastfeeding in Projects to Limit Fertility' points out that actions to promote breastfeeding have generally not been a significant part of Bank population projects even though more women are protected from pregnancy in many countries through breastfeeding than through all family planning contraceptive methods combined.

56. A major bottleneck in Bank nutrition work in earlier years has been a shortage of staff knowledgeable in the field. FY90 saw a change on this front. Africa has hired two new nutrition experts (and is recruiting a third), LAC two, and Asia one. Three of she four Technical Departments now have full-time nutrition experts and one, ASTPN, has recruited a second. In addition, PHRHN conducted a three-day workshop on *Nutrition for Nonnutritionists'; more than twice as many Bank staff applied than could be accommodated. PHR repeated the course in early July 1990 and a special course for agriculture staff is scheduled for April 1991. Increasingly, the Bank is taking advantage of other donor, particularly UNICEF, presence and knowledge in nutrition to compensate for limited staff capacity. For example, the lhnzania Health and Nutrition Project expands a program that UNICEF and WHO successfully mounted with Italian government resources in 1984. Similarly, the Colombia Community Child Care and Nutrition Project is based on a model developed and tested by UNICEF and other non-governmental organizations. Also, Bank missions are receiving more help from UNICEF in the preparation of projects. An identification mission for a nutrition project in Bangladesh and preparation of the Argentina Social Emergency and Adjustment project have been carried out in collaboration with UNICEF.

57. The momentum in nutrition activities which began following Reorganization has continued, and in some ways accelerated, during FY90. Lending has increased and the pipeline for future nutrition operations is strong. Nutrition's linkages with sector operations outside of PHN including agriculture, education, women and development, and others, as well as with adjustment activities, have grown stronger during the year. Staff capacity has been strengthened through nutrition training courses and the recruitment and hiring of additional technical nutrition staff in three of the four Bank regions.

_58._ Nevertheless, most departments still do not have staff experienced in nutrition operations. The Bank continues to need to develop more institutional capacity to respond to managemcnt's
23 commitment to nutrition and the many emerging opportunities. With this additional capacity the Bank will be in a position to:

- (a) ensure that the quality of nutrition operations continues to improve;

- (b) ensure that a comprehensive effort is undertaken to assess the effects of adjustment on nutrition, and that effective compensatory actions are put into place;

- (c) ensure that sector work undertaken through the African food security initiative generates appropriate nutrition operations;

- (d) expand efforts to include nutrition components in primary education projects;

- (e) strengthen the now still weak links between agriculture sector work and operations in the Bank and nutrition issues;

- (f) incorporate breastfeeding promotion components in projects with fertility control objectives;

- (g) explore and act upon other potential links between Bank operations -- e.g. worker productivity issues in infrastructure projects, forestry projects -- and nutrition; and

- (h) direct attention to nutrition issues of increasing visibility and importance, e.g. diet quality issues, especially micronutrient deficiencies.
24

# CHAPTER IV. THE PHN RESEARCH AND SPECLAL GRANTS PROGRAMS: A FOCUS ON ISSUES AND CHALLENGES IN PHN SECTORS

59. During FY90 PHRHN dedicated its resources to the research and support of many PHN sector issues raised in Chapter III. While Chapter IV will limit itself to the assessment of PHRHN's FY90 accomplishments, a more detailed description of PHRHN's work is presented in Annex 9 and a list of publications produced by PHRHN during FY90 is contained in Annex 10.

# POPULATION

60. lNo population research tasks will provide direction both to staff within the Bank, and to government officials on the development of appropriate policy and programs to facilitate an efficient reduction of fertility. The task entitled 'Impediments to Contraceptive Use and Fertility Decline" will build upon previous studies to explore both demand and supply impediments with a view to recommending more effective targetting and design of FP services. "Effective Family Planning Programs" seeks to: (a) demonstrate the effectiveness of property managed family planning programs at increasing contraceptive use; (b) provide a concise synthesis of the major factors that contribute to program effectiveness; and (c) recommend appropriate national policies and donor policies for strengthening family planning programs. The Safe Motherhood Initiative activities described below under the Health section, and in more detail in Annex 9, paras. 17-22, have sought to promote demand for and availability of family planning services in support of maternal health. Special Grant Programs, managed by PHRHN, support research on Population NGOs and on Human Reproduction.

# HEALTH

61. Three PHRHN research tasks aim at assisting in the establishment of national health sector priorities (target groups and cost-effective interventions) in the face of an evolving epidemiological profile and constrained resources: "Adult Health", "Disease Control Priorities in Developing Countries" and "Economic Impact of Adult Mortality in Sub-Saharan Africa". Safe Motherhood activities undertaken by the division have successfully promoted, inside and outside of the Bank, the importance of this issue and continue to explore and promote the most costeffective interventions in this regard.

62. The Africa Health Policy Study, targetted at government officials, Bank staff, and the donor community, will facilitate the development of appropriate health policy for Africa by Africans, by identifying the need for capacity building in this regard, assessing strengths and weaknesses of existing health policies in Africa, and encouraging donors to support the refinement of policy with more resources and greater flexibility. The International Health Policy Program, an initiative supported by two private American foundations, and undertaken in cooperation with the Bank and WHO, also supports the development of local capacity in health policy analysis.

63. The "Hospital Resource Use' study addresses both financing and management issues, exploring ways to increase hospital efficiency and cost-recovery efforts, which would permit reallocation of a significant amount of scarce resources for health away from hospitals to lower level facilities, whose services are suffering from lack of recurrent financing.
25 64. Several health issues are being addressed through special grant programs dedicated to the following topics: ltopical Diseases, AlDs, Riverblindness, Child Survival and Safe Motherhood.

# NUTRMTION

65. A research project on micronutrients will seek to improve information on how dietary quality changes with increased income and on the most cost-effective interventions for improving nutritional status. A Special Grants Program supports the United Nations/Administrative Coordination Committee (UN/ACC) Subcommittee on Nutrition.
26

# **CHAPTER V** PROSPECTUS

# FY91-94 LENDING AND SECrOR WORK PROGRAMS

# Continued Growth

66. Both in terms of number of projects and loan/credit amounts, the volume of PHN lending has grown rapidly over the past five years, as indicated in Annex 1. The significant reduction in lending volume, which occurred in FY87, was a temporary phenomenon, largely attributable to slippage in the lending program caused by the reorganization. The growth since that year, however, permitted a rapid recovery: FY90 figures exceed those of FY86, the year prior to reorganization, by an overall increment of seven projects and by a virtual doubling in the value of the lending program. The future lending portfolio indicates a continuation of the growth in lending. The FY91 program is comprised of 20 projects valued at US$940 million, reflecting a growth in numbers of operations of 11 percent and in loan/credit amounts of 1 percent over FY90. The FY92 program indicates further increase over the FY91 program by 45 percent in terms of projected numbers of operations and by 43 percent in terms of projected loan/credit amounts. Such anticipated growth, even when discounted by a pipeline factor, is significant About one-half of operations planned for FY91-92 are in the Africa Region, with the balance being rather evenly distributed across the remaining three regions. The FY91-94 Sector Work Program reflects, as well, a strong emphasis on the Africa region; of the 77 sector reports planned over the next four years, 52 (or 67 percent) will be focused on Africa.

67. There are a number of reasons for the momentum in actual and forecasted growth in PHN lending. First, while population has been accorded high priority by the Bank for many years, efforts are currently being intensified to stimulate a demand for and a consequent increase in operations in this sector. Second, the demand for family planning and other population interventions is expected to continue to grow, as more governments, particularly those in Africa, come to fully appreciate the negative impact of population growth on development prospects, as well as the health benefits of family planning services. Third, human resource development is accorded very high priority, in the context of overall economic reform and development objectives, by both the Bank and national policy makers, whose dialogues have culminated oftentimes in human resource development strategies. These strategies, in turn, seek the support of various types of Bank interventions, including PHN operations, and PHN components in Social Development, SAL/SAC and SECAL operations. Fourth, many countries' health sectors, in particular, are currently poorly organized and financed and face both rapidly escalating service costs and expanding consumer demand. Fifth, the growth in nutrition activities, which began just after reorganization, has accelerated during FY90 and is expected to continue in terms of its presence in PHN lending (including free-standing and integrated projects), as well as its presence in other multi-sectoral and structural adjustment operations.

# Nature and Focus

68. In addition to the projected rapid growth in the volume of PHN lending, several emerging trends in the nature and focus of PHN operations will have implications for the Bank's future work in these sectors. First the high priority accorded to human resources development by both the Bank and national governments alike, coupled with the merger in the Bank of population, health and nutrition and education sectors into population and human resources divisions, will sustain the emergence of social sector development operations, which encompass sectors within and outside of the rcsponsibilities of PHR divisions. Social sector developmcnt projects comprise one quarter of all operations in the FY91-94 program. Second, PHN sector
27 adjustment operations are another emerging feature of PHN activities. Rather than the design, development and supervision of a project, whose activities are well defined, these operations will focus on broader policies and strategies, and will accommodate the design and implementation by govemments of programs and activities that fall within broad parameters and that fulfill conditions defined under the operation.

# ISSUES AND SUGGESTIONS FOR FUTURE WORK

69. PHN work has contributed significantly to the achievement of the Bank's overall development objectives. First, PHN, as an integral part of human resource development and poverty alleviation activities, figures prominently among the Bank's priorities. Second, PHN objectives have been effectively advanced through a variety of Bank activities: PHN project and sector work; the development and implementation of social development operations, encompassing the integration of education, and often other sectors into a multi-sectoral operation, targeted at poor and vulnerable segments of national populations; and the integration of PHN dialogue and activities into the Bank's macroeconomic work, most particularly, SAL/SAC and SECAL operations. Third, while PHN continues to be a most challenging and difficult field, a positive change in the environment is emerging. The Bank and national governments, alike, are according PHN high priority and the impact of Bank interventions is much greater, now that it is increasingly focussed at the policy and program levels, and meeting with increasingly receptive governments, whose growing appreciation of iS. value of policy reform has culminated in ongoing development and implementation of policies and programs, reflective of and much more appropriate to national PHN sector needs. Declines in TFR and increase in contraceptive use are being observed, as well as significant improvements in health status.

70. This report offers the following suggestions for more effectively carrying out future work in the PHN sectors. While most of the suggestions below address issues common to all three sectors, specific suggestions for improving the Bank's work in population will not be put forward by this report. They will, rather, be withheld pending the production of a population strategy paper, which is currently under preparation by the Population Adviser in PHRDR.

# Thchnical Issues

71. With respect to technical issues which confront Bank staff working on PHN sectors (discussed in Chapter III), this report suggests that particular effort in future work be focussed on the following:

- (a) The increased focus of Bank PHN interventions at the policy and program levels has proven an effective means of achieving on PHN sector objectives. Future Bank work should intensify and improve the quality of our work undertaken thus far in this area. Sector dialogue should provide comprehensive and rigorous policy analysis which fully reflects the wisdom and experience of experts residing in the country/region, as well as the socio-political context of the country in question. Decentralization policies should be fully explored with regard to their practical application in the PHN sectors. Project design should provide for capacity building in policy formulation, planning and program development, and implementation. It should also provide for pilot testing and replication of innovative proposals for policy reform. Provision also should be made for the ongoing review and revision of health sector policies and priorities in the face of evolving epidemiological profiles.
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- (b) Management and institutional development issues need to be addressed more rigorously and comprehensively through project and sector work. Particular emphasis should be placed on: (i) organizational analysis; (ii) coordination between institutions and agencies which share responsibility for one or more of the PHN sectors; (iii) clear definition of roles and responsibilities of agencies and staff involved in the sectors; and (iv) management capacity-building at every level of programs and services through practical training, supervision, limited, carefully selected technical assistance, aimed at developing the capacity of a clearly designated counterpart, and monitoring and evaluation of targets and performance.

- (c) The role of the private sector and NGOs in the design and delivery of PHN interventions is great and growing. Bank interventions in the PHN sectors must, therefore, encompass these vital resources as well as the public sector in order to maximize the individual strengths and contributions of all actors in the PHN sectors, as well as their collective efficiency and effeciveness. This strategy is essential and has great impact potential, given the increasing assistance and attention accorded by the Bank to the policy/program arena.

- (d) PHN financing issues will continue to be crucial to the success and sustainability of any PHN intervention, whether financed by the Bank or not. Given its comparative advantage (in terms of expertise in economics and finance, as well as the leverage it possesses at the macroeconomic level), the Bank should continue its efforts to address and resolve PHN financing issues, which calls for: (i) mobilization of resources for the sectors (through a number of activities such as cofinancing and aid coordination; reallocation of public resources within and across sectors; cost recovery schemes...), and (ii) effective utilization of resources (through such activities as cost couitainment, investment and financial planning and management, decentralized budget decision-making and accountability). It is particularly important in addressing this issue to build national capacity in these disciplines. Aid coordination, while currently being undertaken in many instances by the Bank, should ultimately become the responsibility of governments, whose policies and priorities should drive the content and focus of external assistance to the sectors, rather than the reverse.

# Internal Bank Issues

72. PHR lbchnical Divisions have demonstrated their potential for undertaking sector work, which has provided a regional dimension to PHN issues and succeeded in enhancing dialogues with, and the involvement of, key staff in the Bank (e.g., CODs), as well as regional experts and policymakers, in the development and implementation of Bank and national policies. This contribution has assisted in the achievement of progress in the sectors and should be continued.

73. With the growth in numbers and complexity of PHN work, the need to expand staff capacity is evident. Gains have already been made in FY90, both through training and recruitment, but these are unlikely to be sufficient, given continued growth in the sectors as reflected in the FY91-94 lending program. Budget decisions in the Bank should consider this issue very carefully, particularly given the high priority accorded to PHN sectors. The upcoming Population Strategy Paper will address this issue for the population sector, where a shortage of senior population experts is felt to be an issue.

74. Other suggestions for changing the Bank's internal working environment to improve the effectiveness of PHN operations are explored in Chapter III and summarized below:
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- (a) Efforts should be intensified to employ Third World experts in all aspects of the Bank's work in PHN and to involve beneficiaries in the design, development and implementation of PHN interventions. The idea of establishing a special fund for internships by the Bank, to provide opportunities for Third World experts to work with the Bank for the first time, should be vigorously pursued.

- (b) Roles and responsibilities in all work related to Social Sector Development Projects should be clearly delegated and streamlined.

- (c) Models and methods for co-financing and aid coordination should be further developed and improved, including a full consideration of the costs and benefits of Bank staff involvement.

- (d) Examples of successful coordination with CODs on human resources development as, ects of microeconomic dialogue and operations (SAL/SAC) should be built upon and expanded.

- (e) Promotion and expansion of nutrition activity in a wide variety of Bank lending and sector work (SAL/SAC, agriculture, food security, PHN, education...) should be continued, given the success achieved thus far.

- _(f)_ PHRHN should intensify its efforts to improve: (i) communications and exchange of information among staff in the Bank involved in PHN work; and (ii) processes and systems for information collection and analysis.
31 ANNEXES
PHN Lending, FY86-90 Commitmcnt in US$ Millions (Numbcr of Projects)

|Region|<br>1*|FY86<br>2|3|1|Fv8T<br>2|3|<br>1|FY88<br>2|3|<br>1|F89<br>2|3|1|FM<br>2|3|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|AFRICA<br>ASIA<br>EKA<br>LAC|82<br>242<br>0<br>96|20X<br>582<br>OX<br>_23%_|(5)<br> (4)<br>(0)<br>(2)|31<br>0<br>13<br>10|57X<br>0X<br>242<br>192|(4)<br>(0)<br>(1)<br>(1)|121<br>74<br>0<br>109|402<br>242<br>OX<br>36X|(5)<br>(2)<br>(0)<br>(1)|81<br>290<br>80<br>99|15X<br>53X<br>142<br>182|(4)<br>(4)<br> (2)<br>(1)|232.7<br>192.5<br>119.0<br>389.2|25<br> 21X<br> <br>13X<br>412|(8)<br>(2)<br>(2)<br>(6)|
|TOTAL|420||(11)|54||(6)|304||(8)|550||(11)|933.4||(18)|

^1 - Lending in USS millions 2 - percent of PH1 lending 3 - number of projects
ANSNEX 2 33

# MAJOR SECTORAL COMPONENTS OF SOCIAL DEVELOPMENT PROJEC7TS FY90 (As % of Total Base Costs)

|County|PHN|Education|Employment<br>Training<br>Skills Dev.|Sanitation|Agiculture|Other'|
|---|---|---|---|---|---|---|
|Cameroon|28.0|12.0|38.0|-|---|22.0|
|Chad|31.0|-|18.0|34.0|-|17.0|
|The Gambia|10.0|...|22.0||26.0|42.0|
|Uganda|23.0|38.0|--|9.0|-|30.0|
|Bolivia|61.0|30.0||--|-.|9.0|
|Jamaica|47.0|49.0|--|---||4.0|

1 "Other" = predominantly cross-sectoral activities such as institutional developmcnt; community development; women in development; infrastructure; IEC and project management.