ICA Annual Report 2011 - The Infrastructure Consortium for Africa

ICA Annual Report 2011
8.2. Qualitative Information
The questions that were asked about qualitative information were open to encourage donors to describe what they
would see as their normative modalities and financial arrangements.
In the first question, donors were asked to identify risks that led to disbursement delays. The answers given are
listed next to project phases for a better overview.
Identified risks that led to disbursements delays
Project preparation risks:
Insufficient project quality at entry criteria
Insufficient attention to project implementation by facilities
Over optimistic planning during initial planning phases tending to raise wrong
expectations regarding pace of disbursements
Lack of baseline data and consistent indicators delaying project approval
Rapid increases in overall portfolio commitments;
Delays in preparing necessary documents on the part of Ministries/Agencies
concerned of the recipient country related Loan Agreement (L/A), banking arrangements
and invoices for disbursement
Protracted loan negotiations
Complicated co-financing arrangements:
- Cross conditionality with other co-financiers on which donor has no control
- Long Procurement processes due to different procedures for different cofinanciers
Projects sponsors fail to address the conditions for making loans effective and
Obtaining signed Memoranda of Understanding can be time consuming
Project implementation risks:
Project monitoring risks:
Lack of adequate staffing within facilities
Lack of capacity of implementing agencies
Lack of readiness at entry
Cost overrunning during implementation
Conditions Precedent:
- Slow implementation of Conditions Precedent (CPs) of the EIB Finance Contracts
- Little control on a number Institutional related CPs (i.e. tariff increases, Government
bill payments, etc)
- The more complex the projects become (in particular in blending with grants),
the more Conditions Precedent the borrowers have to satisfy, and the slower
the disbursement rate becomes
- Delays in achieving conditions prior to disbursement including Environmental
and social obligations, securing all licences, land titles, etc.
Cross-effectiveness conditions in projects with multiple donors
Delays in tender due to long evaluation processes including financiers’ “no
objection”
Backloaded disbursement profiles for large infrastructure projects (studies and
procurement processes in initial years with civil works and bulk of disbursements
in later years); and
Force majeure
Long procurement procedures, lack of competition, weaknesses in financial,
contractual management of National Authorities (as part of sector specific PFM
issues) and project supervision; and
Weak project management capacities
Sebastian Mogos-Lindemann, November 2012
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