Document o f The World Bank

FOR OFFICIAL USE ONLY

Report No: 35446-RW

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED GRANT

IN THE AMOUNT OF SDR 6.9 MILLION (US$lO MILLION EQUIVALENT)

TO THE

GOVERNMENT OF RWANDA

FOR AN

eRWANDA PROJECT

August 3,2006

Public Sector Reform and Capacity Building (AFTPR) Country Department 9 Africa Region

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

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CURRENCY EQUIVALENTS

(Exchange Rate Effective July 25,2006)

ACGF ACBF ADB AfDB AFTEG AFTFM AFTPC AFTPR AFMRW APL ARV ARTEL BBS CAP CAS CEPEX CITPO CPAR CPRGS DAF DfID DCA DISC DO DPT1/3 ELECTROGAZ e M I S EU F A F A 0 F M U FMR FMS FR GDLN

Currency Unit = Rwandan Franc

1 USD = SDR0.69 552.74RwF = USD 1

FISCAL YEAR January 1 - December 31

ABBREVIATIONS AND ACRONYMS Africa Catalytic Growth Fund African Capacity Building Foundation Asian Development Bank African Development Bank Africa: Energy Unit Africa: QK Financial Management Africa: QK Procurement Africa: Public Sector Reform and Capacity Building Unit World Bank Office in Kigali, Rwanda Adjustable Program Lending AntiRetroViral Africa Regional Telecommunications Bulletin Board Systems Community Access Point Country Assistance Strategy Central Public Investments and External Financial Bureau Policy Division (IBRD Telecom and Informatics) Country Performance Assessment Report Comprehensive Poverty Reduction and Growth Strategy Directorate o f Finance and Administration (of RITA) UK Department for International Development Development Credit Agreement District Information Services Centers District Office DiptheriaPertussis/Tetanus (vaccine) Power company Education Management Information System European Union Financing Agreement (formerly the DCA) Food and Agriculture Organization Financial Management Unit Financial Monitoring Reports Financial Management Specialist Financial Report Global Development Learning Center

FOR OFFICIAL USE ONLY GDP GIS GoR GTZ HIDA HIPC HRD IADB IAS ICB ICT ICT4D IDA IEC IFAD IFMIS I F C ISGEA IRC ISP IXP JFICT JICA KIST LAN LCS LEGAF LIB M A P M&E MDA MDG MDRI MIFOTRA MINEDUC MINESANTE MNINFRA MSCBP MTEF MTN NCB N I C I NTB NUR OBA OPCPR

Gross Domestic Product Geographic Information Systems Government o f Rwanda German Technical Cooperation Human Resources and Institutional Capacity Building Agency Heavily Indebted Poor Countries Human Resource Development Inter-American Development Bank International Accounting Standards International Competitive Bidding Information and Communication Technology Information and Communication Technology for Development International Development Association Information, Education, and Communication International Fund for Agricultural Development Integrated Financial Management Information System International Finance Corporation Information Solutions Group Enterprise Architecture International Red Cross Internet Service Point Internet Exchange Point Japan Fund for Information and Communications Technology Japan International Cooperation Agency Kigal i Institute o f Science and Technology Local Area Network Least Cost Selection Africa Practice Group Legal Vice Presidency Limited International Bidding Multi-Sectoral HIVIAIDS Project Monitoring and Evaluation Ministries, Departments, and Agencies Millennium Development Goals Multi-lateral Debt Relief Initiative Ministry o f Public Works Ministry o f Education Ministry o f Health Ministry o f Infrastructure Multi Sector Capacity Building Program Medium Term Expenditure Framework Telephone company National Competitive Bidding National Information and Communication Infrastructure National Tender Board National University o f Rwanda Output Based Approach Procurement Policy and Services Group

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

PA PRSC PEARL, PFM PFMRP PMCA PMU POM PPF PRS PPP PRSP PSCBP PSO QCBS RDGG RIEPA RINEX RITA RURA RVP RWANDACELL RWANDATEL SA SBCQ SEDP SFB SIDA S I L Smart Gov SME SNV SOE SWAP TA TABMIS TAL TERRACOM TOR TracNet UAF UERP UNDB UNFPA USAID VSAT

Project Agreement Poverty Reduction Strategy Credit Public Enterprise Administration and Reform Loan (US AID) Public Financial Management Public Financial Management Reform Project Procurement Management Capacity Assessment Project Management Unit Program Operations Manual Project Preparation Facility Project Status Report Public Private Partnership Poverty Reduction Strategy Paper Public Sector Capacity Building Project Public Service Organization Qualifications/Cost Based Rwanda Development Gateway Group Rwanda Investment and Export Promotion Agency Rwanda Internet Network Exchange Rwandan Information and Technology Authority Rwanda Utility Regulatory Agency Regional Vice Presidency Telephone company Telephone company Subsidiary Agreement Selection based on Consultant Qualifications Socio-Economic Development plan Selection under Fixed Budget Swedish International Development Agency Specific Investment Loan Software for public finance Small and Medium sized Enterprises Netherlands Development Organization Statement o f Expenditure, State-Owned Enterprise Sector Wide Approach technical assistance Treasury and Budget Management Information System Technical Assistance Loan Telephone company Terms o f Reference Treatment and Research AIDS Center Network Universal Access Fund Urgent Energy Rehabilitation Project United Nations Data Base United Nations Fund for Population Activities US Agency for International Development Very Small Aperture Terminal

WAN Wide Area Network

Vice President: Gobind T. Nankani Country Managermirector: Pedro Alba

Sector Manager: Helga W. Muller Task Team Leader: Guenter Heidenhof

Co-Task Team Leader: Arleen Cannata Seed

RWANDA eRwanda Project

CONTENTS

Page

A . STRATEGIC CONTEXT AND RATIONALE .................................................................. 1 Country and sector issues .................................................................................................... 1

Rationale for Bank involvement .......................................................................................... 3

Higher level objectives to which the project contributes .................................................... 4

1 . 2 . 3 .

B . PROJECT DESCRIPTION .................................................................................................. 4 Lending instrument .............................................................................................................. 4 1 .

2 . 3 . 4 . 5 . 6 .

Project development objective and key indicators .............................................................. 5

Project components .............................................................................................................. 5

Results framework ............................................................................................................... 8

Lessons learned and reflected in project design .................................................................. 8

Alternatives considered and reasons for rejection ............................................................... 9

C . IMPLEMENTATION ......................................................................................................... 10 1 . Partnership arrangements .................................................................................................. 10

2 . Institutional and implementation arrangements ................................................................ 11

3 . Monitoring and evaluation o f outcomes and results .......................................................... 12

4 . Sustainability ..................................................................................................................... 12

5 . Critical risks ....................................................................................................................... 13

6 . Board conditions and covenants ........................................................................................ 15

7 . Grant effectiveness conditions and covenants ................................................................... 15

D . APPRAISAL SUMMARY .................................................................................................. 15 1 . 2 . 3 . 4 . 5 . 6 . 7 . 8 .

Economic ........................................................................................................................... 15

Financial ............................................................................................................................ 15

Technical ........................................................................................................................... 16

Institutional ........................................................................................................................ 16

Social ................................................................................................................................. 17

Environmental ................................................................................................................... 18

Safeguard Policies ............................................................................................................. 18

Policy Exceptions and Readiness ...................................................................................... 18

Annex 1: Country and Sector or Program Background ................................................................. 19 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies .......................... 26

Annex 4: Detailed Project Description .......................................................................................... 32

Annex 6: Implementation Arrangements ...................................................................................... 42 Annex 7: Financial Management and Disbursement Arrangements ............................................. 46 Annex 8: Procurement Arrangements ........................................................................................... 57 Annex 9: Economic and Financial Analysis .................................................................................. 64 Annex 10: Safeguard Policy Issues ............................................................................................... 66

Annex 3: Results Framework and Monitoring .............................................................................. 28

Annex 5: Project Costs .................................................................................................................. 41

Annex 1 1 : Project Preparation and Supervision ............................................................................ 67 Annex 12: Documents in the Project File ...................................................................................... 68 Annex 13: Statement o f Loans and Credits ................................................................................... 69 Annex 14: Projects with an eGovernment Component ................................................................. 70 Annex 15 : N IC I Activities ............................................................................................................. 76 Annex 16: L i n k s with other projects ............................................................................................. 92 Annex 17: Possible Projects for a Phase I1 if supplementary funding i s secured ......................... 98 Annex 18: Telecommunication Infrastructure and markets in Rwanda ........................................ 99 Annex 19: Rwanda Universal Access Fund ................................................................................ 103 Annex 20: Country at a Glance ................................................................................................... 108 Annex 21: Letter o f Sector Policy ............................................................................................... 110

Map IBRD 33471

RWANDA ERWANDA PROJECT

PROJECT APPRAISAL DOCUMENT AFRICA AFTPR

Date: August 3,2006 Country Director: Pedro Alba Sector Managermirector: Helga W. Muller

Team Leader: Guenter Heidenhof Sectors: General information and communications sector (50%); General public administration sector (50%) Themes: Other public sector governance (P); Public expenditure, financial management and procurement (S);Technology diffusion (S) Environmental screening category: Not Required

Project ID: PO98926

Lending Instrument: Technical Assistance Grant

[ ] Loan [ ] Credit [XI Grant [ ] Guarantee [ ] Other:

For Loans/Credits/Others: Total Bank financing (US$m.): 10.00 Proposed terms: N /A

Financing Plan (US$m) Source Local Foreign Total

BORRO WERRECIPIENT 0.00 0.00 0.00 IDA Grant 10.00 0.00 10.00 Total: 10.00 0.00 10.00

Borrower: Government o f Rwanda Rwanda

Responsible Agency: Ministry o f Infrastructure BP24 Kigali Rwanda RITA (Rwanda Information Technology Authority) Telecom House, 3rd Floor Boulevard de L'Umuganda, P.O. Box 7229 Kigali Rwanda Tel: +250-583222 Fax: +250-583222 info@rita.rw www.rita. gov.rw

Estimated disbursements (Bank FY/US$m) Y innual lumulative

FY07 FY08 FY09 FYlO F Y l l 0 0 0 0 3.44 3.12 1.72 1.24 .48 0.00 0.00 0.00 0.00 3.44 6.56 8.28 9.52 10.00 0.00 0.00 0.00 0.00

The Project will complement existing activities by the World Bank and other development partners, in particular in the social sectors and in rural development. It draws heavily from the fundamental building blocks lain in the Public Sector Capacity Building Project (PSCBP) in the areas o f basic support o f government functions, improvement o f service delivery, and capacity building.

Project description [one-sentence summary of each component] Ref: PAD B.3.a, Technical Annex 4 The project supports four components (see Annex 4 for a detailed description o f the components) which focus on the use o f technology as an enabler to growth and development. While there are many activities which rely on ICT, in al l cases the anticipated results relate to selected improvement o f government’s internal functions, i t s ability to deliver services and information to i t s citizens, and strengthening o f the private sector for economic growth and poverty reduction.

Given the complex nature o f this cross cutting project, it would not be in the interest o f the government to jump directly into high profile applications for government or citizens. As with other large scale projects, it behooves the government and the project team to pay close attention to the building blocks o f infrastructure before adding upper layers, that is, applications and information. Thus, the f i rs t and third components are primarily concerned with the foundation for eGovernment (the basic infrastructure to link the ministries and other government offices, the strengthening o f the government’s district offices, and the underlying computer systems which will form the basis o f the operating system). Upon that, component two, which focuses on services and information for citizens, can be built. Component four i s not an application; rather it i s a means o f building capacity within RITA to undertake a major project.

Which safeguard policies are triggered, if any? Re$ PAD D.6, Technical Annex 10 The Environmental category assessed for this project i s C. There are no major environmental issues associated with the eRwanda, which i s a public sector reform project which relies heavily on I C T and applications to improve government efficiency and effectiveness.

As part o f i t s N I C I plan, the Government has already financed the development o f a government network (GovNet) which l i n k s key Ministr ies and provides them with high speed communications and office automation software. The eRwanda project will extend this backbone to District Offices, but will not lay additional fiber optics cables, which will be lain by the telecommunications incumbent. Significant, non-standard conditions, if any, for: Re$ PAD C. 7 Board presentation: 1. Subsidiary Agreement 2. Project Implementation Plan

Loadcredit effectiveness: 1. Core staffing for eRwanda (Project Manager, Procurement Specialist, Finance Specialist) 2. Project Operations Manual (including the Procurement Manual and the Finance Manual)

Covenants applicable to project implementation:

A. STRATEGIC CONTEXT AND RATIONALE

1. Country and sector issues Country Background: Rwanda i s a small, landlocked country with about 9 mil l ion inhabitants. With a per capita GDP o f USD 230, and with 60 percent o f the population living below the poverty line, i t i s one o f the world’s poorest countries. I t s population density o f 340 inhabitants per square kilometer i s one o f the highest in the world; about 85 percent o f the population lives in rural areas. Rwanda’s economy i s largely agriculture based, accounting for about 41 percent o f GDP but over 80 percent o f the population. Services make up 38 percent and consist mainly o f wholesale and resale trade in various products, transportation and public administration. Industry accounts for 21 percent o f GDP o f which manufacturing accounts for 8 percent and construction 11 percent.

GDP growth has recovered from 0.9 percent in 2003 to 4 percent in 2004, despite significant energy shortages, mainly driven by growth in construction, transport and information and communications sectors. According to the Ministry o f Finance’s statistics and as reported at the Development Partner’s Meeting in February 2006, GDP growth has reached 6 percent in 2005 with inflation decreasing from around 10 percent in 2004 to 6 percent by end 2005 and 3-5 percent per year in the medium term. The country recently benefited from HIPC debt re l i e f which led to a reduction in the debt to export ratio to 150 percent by end-2003. Additional debt re l ie f will be forthcoming under the Multi-lateral Debt Relief Initiative (MDRI). Rel ie f from both the World Bank and IMF under the MDRI has resulted in a fwther reduction o f Rwanda’s debt to export ratio to 58.5 percent by end 2005. Despite these initiatives, the country remains vulnerable to debt distress given its l o w export base, and wil l continue to need grant financing for the foreseeable future.

The main challenges in the social sectors o f health and education are related to the difficulties in serving a poor and decentralized rural population, the lack o f skilled medical staff and educators, the difficulty in obtaining and distributing materials for clinics and educational institutions, and the lack o f reliable electrical and water supplies. This coupled with a high illiteracy rate amongst adults makes reaching vulnerable families al l the more difficult. It i s estimated that nearly 50 percent o f the adult rural population are illiterate in their native language, Kinyarwanda. The private sector i s nascent but rapidly growing, particularly in the fields o f construction, telecommunications infrastructure, and ICT. Rapid increases in service activities (including the financial sector, media, commerce and exports) are also fueling economic growth. I C T companies in Rwanda have reported that over 80 percent o f their work relates to contracts with the Government.

The Country’s Development Strategy: In i t s Vision 2020 statement, the GoR envisions a transformation from a largely agriculture-based economy to one based on knowledge and information, in an effort to reach middle income status by 2020. The Vision 2020 document was endorsed by Cabinet in 2000, after consultations with civ i l society and the private sector. The Government has emphasized i t s intention to use investment in I C T as the key driver for this transition and as a vehicle for improving the delivery o f public and private services, particularly in the rural areas. The Vision 2020 document, which has been made ‘operational’ through the National Information and Communication Infrastructure (NICI) Plans, lays out how this

1

transformation i s to be achieved. The N I C I Plans are broken down into four 5 year plans, and Rwanda i s currently implementing N I C I 11.

The NICI Plans: The first N I C I Plan was budgeted at USD 500 mi l l ion but was only partially funded and implemented. During i t s evaluation in June 2005, the Government recognized the country's shortcomings: lack o f sufficiently skilled staff to implement the projects, lack o f infrastructure to support the activities, insufficient understanding o f the role of I C T in development; insufficient attention paid to the needs o f local communities and rural areas, and lack o f leadership. Nevertheless, investments in technology have achieved some success (such as installation o f GovNet to link the Ministries, the initiation o f the TracNet' system for health, the provision o f computers to primary and secondary schools, the installation and use o f the African Virtual University site) and they have provided a good foundation for eGovernment (such as the improvement o f office automation for the ministries, the hiring and training o f I C T Directors for the Government, and the creation o f some rudimentary websites) and for future investments in ICT. The N I C I I1 plan has addressed many o f the shortcomings o f the N I C I I plan; in particular, i t i s more development focused and establishes more realistic results. The plan also enjoys a larger endorsement by Rwandan society.2

In June 2005, the GoR approached the World Bank to fund an eRwanda Project, as a subset o f the N I C I I1 Plan. This project focuses on the core activities o f the N I C I I1 Plan which will bring the greatest positive results for Rwanda: the development o f the eGovernment platform and applications which have the greatest development impact for the citizens. For example, while the project necessarily focuses primarily on the eGovernment pillar - with classic eGovernment applications such as improvements in content management, citizen's services, and internal government infrastructure - other activities address the need to develop the human capacity o f Rwandans to manage and use technology, provide for direct funding o f infrastructure within the Government offices, and create opportunities for the improved growth in the I C T industry and the larger Rwandan economy. Collectively, these activities will have a direct impact on the social fabric o f society by addressing the service delivery and information needs o f the rural populations, and strengthening the underlying legal and regulatory framework for development o f Vision 2020.

Readiness for eGovernment: Before the genocide in 1994, Rwanda was characterized as having a weak infrastructure and was not considered to be attractive to investments. This lack o f readiness to accept technology was offset by the Vision 2020 and the N I C I plans which achieved a remarkable leve l o f computerization in the twelve years since the genocide. Currently, al l ministries in Kigal i have reached some level o f office automation, with the Ministries o f Health, Education and Finance being the most developed, Fiber optics link most o f the ministries but there i s no shared email service, no government document database, and the I C T skills found

' TracNet: TracNet i s a dynamic information technology solution designed to collect, store, retrieve, disseminate and facilitate the analysis o f critical program, drug, and patient information related to HIV/AIDS. In this context, it i s an inexpensive and easy to use system which employs simple text messages from a mobile phone to help the AntiRetroViral (ARV) clinics report their activities to the Ministry o f Health. Clinicians cal l a tol l free number and are led through a series o f questions - answers are typed into the phone - about their delivery o f services. Data i s then aggregated at the Ministry and available through the internet from any location. Reports can be generated by clinic, by district or for the program as a whole. This technology can be replicated for other activities.

See Annex 15 for a full discussion of the N IC I Plans.

2

amongst ministerial staff are weak. Few ministries have properly functioning Local Area Networks (LANs) and there i s no standard for application development. While many o f the ministries have computer equipment, this equipment was primarily donated by development partners and i s o f different makes and models, making support and maintenance difficult. In early 2000, the Government had the foresight to create the Rwandan Information and Technology Authority (RITA), specifically to coordinate al l I C T investments and to ensure their viability.

According to the 2005 African e-Index, penetration o f and access to telecommunications (including fixed telephone lines, internet and mobile) in Rwanda i s amongst the lowest in the world, especially in rural areas, and prices for services, notably mobile telephones, are very high. The I C T infrastructure such as telecommunications and electricity i s weak; yet, through projects such as the laying o f fiber optics cables and various energy projects, the GoR i s addressing this as a national priority. Another serious impediment to I C T development i s the lack o f human resources, both in technical areas as well as in policy-making, which i s being addressed by the Public Sector Capacity Building Project (PSCBP) and Human Resource Development (HRD) project.

Yet, the African e-Index concludes that demand for communications services i s high. Coupled with strong commitment for promoting I C T for development at the highest level o f government, there are significant opportunities for business development if the Government can create the necessary policy and regulatory environment and address energy shortages. For the Government it i s not a matter o f a choice between the development o f I C T OY investments in the social sectors such as health and education. It i s the recognition that the combination between I C T development and investments in the social sectors, while recognizing tradeoffs, will potentially yield the greatest benefit. I C T i s emerging as a significant opportunity or niche that Rwanda can leverage.

For the GoR to successfully accomplish i t s development goals, it must focus o n the drivers o f growth. A significant driver o f growth in Rwanda is I C T development, and the GoR is fully committed to capitalize on it, and incorporating I C T as a vital part o f i t s development strategy. The GoR has achieved a significant level o f computerization in the last twelve years since the genocide, and i s continuing to do so with i t s strong commitment to further I C T development.

2. Rationale for Bank involvement

Comparable eGovernment projects in other countries such as Sr i Lanka and Ghana, as well as in Vietnam, Armenia, and Mexico have demonstrated the World Bank’s competitive advantage in harnessing technology to more effectively implement development reforms and the delivery o f services. The Bank has further recognized that I C T i s a tool o f increasing importance in i t s arsenal o f offerings to support public sector reform. Several other donors have also recognized the potential o f using I C T to assist Rwanda in reaching i t s development goals and have indicated their willingness to coordinate their efforts and contribute to the N I C I Plan.

The Bank’s engagement i s based on the understanding that I C T i s not an end in i t se l f but a means for better service delivery, greater transparency, effectiveness and efficiency o f government operations and private sector growth. The project reflects this understanding.

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3. Higher level objectives to which the project contributes Rwanda’s PRSP, discussed by the boards o f the World Bank and the IMF o n August 12, 2004, sets out the Government’s vision for achieving the MDGs, including reducing poverty by half by 2015. I t articulates a medium-term program (2002-07) as a f i rs t step toward the GoR’s “Vision 202077.

I C T is explicitly stated as an area o f intervention under “economic infrastructure”, which is one o f six broad priority areas. In addition, eGovernment i s seen as a cross-cutting intervention which equally benefits the other five priority areas: eRwanda seeks to support agriculture transformation and rural development by providing farmers with ready access to vital information on crops, market prices etc.; it contributes to private sector development by creating new business opportunities for local I C T f i r m s ; i t seeks to improve human resource development and the quality o f l i f e by broadening access to information o n health issues, education, government services, HIV/AIDS etc.; it also offers an opportunity to specifically reach out to vulnerable groups (orphans, widows, people affected by HIV/AIDS) and finally, eRwanda i s expected to contribute significantly to good governance as it improves public sector transparency and accountability through the development o f service delivery directories as well as specific applications to increase the efficiency and effectiveness o f the public sector in critical areas such as public financial management.

The last Country Assistance Strategy (CAS) for Rwanda was discussed by the Board in December 2002. Consistent with PRSP priorities, the CAS articulates the Bank’s support around four themes: (i) revitalization o f the rural economy; (ii) private sector development and employment creation; (iii) human and social development; and (iv) improvement in governance and effectiveness o f the public sector. While I C T or eGovernment has not been explicitly addressed in the 2002 CAS, eRwanda presents an important tool for accelerating progress in al l four areas as outlined above. The GoR has clearly stated i t s understanding that I C T i s a key enabler for better service delivery, for the stimulation o f the private sector and the growth o f the economy, and for more effective public sector functions. eGovernment will be presented as an integral part to the Bank’s strategy in the upcoming Interim Strategy Note (covering FY07-08, thus extending the program outlined under the 2002-06 CAS for a period o f one and a hal f years) as well as the new CAS, to cover FY08-12.

B. PROJECT DESCRIPTION

1. Lending instrument

Support to the Government will be provided through an operation o f which the World Bank i s offering initial funding o f USD 10 mi l l ion from World Bank resources. The eRwanda Project will have a total duration o f 4 years, during which additional funding will be sought (e.g., other development partners, Trust Funds, and supplementary funding). The project, which i s a subset o f the N I C I I1 plan, foresees interventions that would gradually transform the delivery o f public and private services based on the use o f modern technology. The initial elements o f the project will focus on the implementation o f fundamentals o f the overall government strategy which are outlined in more detail below and subsequent activities will build upon these improvements. This approach provides a flexible instrument for the implementation o f the Government’s strategy which can be adjusted according to implementation progress: it also represents a long-term

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commitment on the part o f the Government and i t s cooperating development partners for the implementation o f the intended reforms.

The overall cost o f an eGovernment solution i s estimated at much higher than the World Bank contribution to the project o f USD 10 million. The Government i s in the process o f mobilizing additional funding for other aspects o f the N I C I plan which are not funded by eRwanda.

2. Project development objective and key indicators

The key objective o f the project i s to improve: (i) efficiency and effectiveness o f some internal processes o f the Government o f Rwanda; and (ii) the delivery o f applications and services in selected key sectors including better access to information through the use o f technology.

Key indicators include the percent increase in the government institutions which demonstrate improved delivery o f services and information to citizens and the number o f citizens which express satisfaction with the improved services and access to information.

3. Project components

The project supports four components (see Annex 4 for a detailed description o f the components) which focus on the use o f technology as an enabler to growth and development. While there are many activities which rely on ICT, in al l cases the anticipated results relate to selected improvements o f government’s internal functions, i t s ability to deliver services and information to i t s citizens, and strengthening o f the private sector for economic growth and poverty reduction.

Given the complex nature o f this cross-cutting project, i t would not be in the interest o f the Government to jump directly into high profile applications for government or citizens. As with other large scale projects, i t behooves the Government and the project team to pay close attention to the infrastructure building blocks before adding upper layers, that is, application, services and information. Thus, the first and third components are primarily concerned with the foundation for eGovernment (the basic infrastructure to link the ministries and other government offices, the strengthening o f the Government’s district offices, and the underlying computer systems which will form the basis o f the operating system). Upon that foundation, component two - which focuses on the services for citizens - can be built. Component four i s not an application; rather it i s a means o f building capacity within RITA to undertake a major project.

Component 1 - Strengthening government effectiveness and efficiency (USD 3.80 million)

This component aims at improving key internal systems o f the Government which are considered critical elements for the implementation o f the overall development strategy o f the Government. The main focus o f this component will be support for (i) the harmonization o f the basic technology for the Ministries, the District Offices and the Provincial Offices; and (ii) the implementation o f a government portal and intranet which l i n k s central ministries and district offices, and which provides availability and easy access to a variety o f innovative applications and information services. Support for some o f these reforms i s already programmed under the World Bank’s PSCBP and under the European Union - DfID Trust Fund for Public Financial Management.

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The project will build on these reforms and assist the Government in (i) developing standards for the deployment o f the new system to central ministries, provincial and district offices, (ii) equipping Ministr ies and district offices, (iii) putting in place a network infrastructure (WAN) that connects al l relevant institutions at the national and sub-national levels, (iv) establishing a cyber-security system which will ensure data accuracy, integrity and interoperability, (v) establishing a maintenance and support infrastructure for the I C T applications, and (vi) I C T training and capacity building activities.

Building upon that base, support under the project will also include the implementation o f ‘quick wins’ or early results, in particular in government services with a direct interface to the population. For example, one application which was urgently requested by the Government was a system to track market prices for agricultural goods. A simple cell phone data entry and query system, backed up by databases at the Ministry o f Agriculture, can be designed and implemented within the first year o f the project. At a later stage, it i s also envisaged to include the modernization o f other government services, in particular online access to public tenders and a pi lot payment system using mobile cell phone technology and the postal system.

Since Component 1 i s so fundamental to the entire project, it i s envisioned to cost about USD 3.8 million, o f which nearly USD 2.0 mi l l ion are c iv i l works and goods/equipment. An additional USD 1 mi l l ion i s allocated to training, capacity building and consulting services, about USD 0.3 mi l l ion i s reserved for security and other internet governance activities, and hal f a mi l l ion i s allocated for operations and maintenance costs.

Component 2 - Improving service delivery to citizens and the private sector (USD 3.51 million)

This component will assist the Government to deliver improved services to citizens and the private sector. I t will target primarily the service applications in health, agriculture, environment, and education. These services will be subjected to a re-engineering process with the goal o f improving quality, access and service standards. A key element o f the reforms will be to improve access to information about basic (health, education, agriculture, environment, judicial) services and to disseminate much needed information that i s important for the livelihood o f citizens. To achieve this, the project will support the provision o f public access points in urban and rural areas, and the dissemination o f information geared primarily towards vulnerable groups, such as women, children, and farmers. Specific interventions will include the dissemination o f ‘Citizen’s Guides’ and other crucial information o f key government services (e.g., health, education, agriculture, and environment) to districts and local communities. This information will be provided through public access points (see below) or through other means such as the internet, radio, brochures, street theatre, etc. The intervention will complement ongoing PSCBP activities. The project will also provide assistance for the involvement o f communities in content development and dissemination mechanisms to better focus public services and to determine what information i s essential for local communities.

The project will fund the development and maintenance o f public access points in both urban and rural areas so that the services and information can be made available to the public. During the first year o f the project, a variety o f kiosk models will be explored (public, private, public-private

6

partnerships) as well as a range o f mechanisms for the ‘care and feeding’ o f the kiosks. Training for kiosk operators (technical, financial, IT applications) will also be included.

Component two i s estimated to cost USD 3.51 million, which i s primarily divided amongst application development, public access technologies, information dissemination, and training and capacity building.

Component 3 - Improving access to services through enhanced infrastructure in energy and telecommunications (USD 0.82 million)

This component will assist government in promoting access to competitive and affordable telecommunications services in remote areas. To this end, the project will strengthen the capacity o f the regulatory agency for the telecommunications sector (RURA) and implement funding mechanisms to improve access in rural areas.

The project will support:

Strengthening RURA’s operational efficiency. In this context, technical assistance will be provided to improve the capacity o f RURA to effectively regulate and monitor the sector. I t will also reinforce the policy and regulatory framework for the use o f modern technology and the implementation o f eGovernment applications.

Improving basic access infrastructure in financing connectivity to a set o f provinces and district offices, and linking public access points in rural areas to effectively disseminate and exchange information.

Component three i s heavily dependant on strengthening and operating costs o f infrastructure (such as fiber optics or energy systems) and thus i s estimated at USD 0.82 million, o f which about hal f will be used for support to strengthen R U M .

Component 4 -Project management (USD 1.47 million)

The component will assist the Government to establish a project management system for the change process triggered by the implementation o f aforementioned reforms. Support will focus primarily on the Ministry o f Infrastructure which will lead the implementation o f eGovernment reforms and on i t s implementing agency RITA. The project will also cover the establishment o f an adequate quality assurance mechanism to accompany the implementation o f the reforms as well as the development o f a monitoring and evaluation system for the eGovernment reforms. Funds wil l also be available for technical assistance and analytic studies and to cover the salaries o f those RITA staff who are employed as consultants solely dedicated to the project (for a period o f 18 months).

This component i s envisioned to cost approximately USD 1.4 million, o f which about USD 300,000 i s allocated for staff salaries, USD 150,000 for M&E and USD 200,000 for studies and other technical assistance to RITA. The balance i s allocated for audits, training and operating costs.

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Component Indicative Costs

1. Strengthening government 3.80 effectiveness and efficiency

2. Improving service delivery to 3.51 citizens and private sector

3. Improving access to services through 0.82 enhanced infrastructure in energy and telecommunications

USD million

4. Project Management 1.47 Unallocated 0.38 TOTAL FINANCING REQUIRED I 10.00 I 100% I

Percent of total

38.0

35.1

8.2

14.7 3.8

4. Results framework

The results framework and the intended project outcomes were developed through a participatory process involving al l major stakeholders: Government staff have contributed greatly to the development o f the resul ts framework and have also benefited from a World Bank workshop in February 2006 which focused three days specifically on M&E. A small team was created who both attended the workshop and a special eRwanda M&E meeting to f lesh out the indicators. During the eGovernment workshop in November 2005, groups representing the Government, the Private Sector and the C iv i l Society suggested indicators they believed would best demonstrate success and these fed into matrix. In addition, the Information, Education, Communication (IEC) staff member from the eRwanda team has conducted extensive consultations with communities in rural areas. These communities have been given the opportunity to comment directly on what would directly affect the outcomes o f the eRwanda project. Table 2 provides a summary o f key outcomes and indicators. A detailed results framework for the project i s presented in Annex 3.

Table 2 - Outcomes and Indicators

Outcome More efficient delivery o f government services and information to citizens and the urivate sector Improved infrastructure o f government offices

Indicator (i) Service standards for delivery o f sectoral services have significantly improved (ii) Core information in the areas o f health, education and agriculture are made available through public access points (i) Information exchange within government (central government, provinces and districts) improved based on the use o f IT (ii) Government services use modern technology to deliver services in a timelv and transuarent manner

5. Lessons learned and reflected in project design

The proposed project reflects the need to better coordinate government reforms that imply the use o f modern technology. I t builds o n international experiences with the implementation o f

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eGovernment reforms. These experiences call for (i) a clear operational focus o f the eGovernment agenda that emphasizes improving services rather than merely introducing ICT, (ii) clearly identifying reform priorities to avoid implementation problems, (iii) adjusting eGovernment interventions to the absorptive capacity within government and the private sector; (iv) providing adequate training and capacity building activities to conceptualize and institutionalize the intended reforms, and (v) establishing project management arrangements with clear and decisive leadership at the technical and political levels.

Rwanda has particularly benefited from the experience o f eGovernment projects in Sr i Lanka and Ghana; implementation teams in these countries have been consulted and their recommendations are reflected in the project design. The operational agenda o f the project has been extensively discussed with various stakeholders, in government, in the private sector and in civ i l society. These consultations have shaped and influenced both project design and sequencing. A key recommendation from these consultations i s to establish an adequate quality assurance mechanism that i s able to monitor the implementation o f the reforms. It i s also envisaged to discuss implementation progress and concerns in the context o f regular workshops with al l relevant stakeholders. Regular impact assessments and independent reviews o f the implementation progress will be conducted, findings will be discussed and the recommendations will be integrated into a revised implementation plan.

The Government has put in place a project implementation mechanism that reflects international experience and which ensures that the reforms are owned by the administration: project implementation will be enacted by an implementing agency (RITA) under the Ministry o f Infrastructure. In this agency, staff wil l be embedded in the overall structure, but assigned to the project. Oversight and coordination will be ensured by the RITA Management Team and the Board o f Directors, who may be supplemented, on occasion, by relevant persons from the Government, private sector and c iv i l society. The Minister o f State for Energy and Telecommunications will report to the Cabinet quarterly on the activities o f the project, and there will also be a quality assurance mechanism, comprising external parties, who will periodically review the project.

O f particular importance i s the coordination o f the project with other ongoing reforms, for example with the PSCBP. This will be ensured through regular management meetings that are aimed at harmonizing and coordinating the various reform agendas.

6. Alternatives considered and reasons for rejection

Traditional investment loan vs. phased approach

eRwanda i s set up as a traditional sector investment project which also intends to lay the ground for future investments by the Bank and other development partners. In view o f the rapidly changing I C T environment in Rwanda, an APL-approach which would require definition now o f potential triggers and performance benchmarks for the next phase, was not considered to be an adequate instrument. The Government i s moving very quickly on a variety o f fronts and it would be premature to make firm long-term decisions at this juncture.

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Investment loan vs. budget support

In principle, support to the Government could also be provided through budgetary assistance. Such assistance, however, would require well-functioning public financial management and procurement systems that are yet to be developed with the support o f th is and other projects. Furthermore, the GoR has not yet gained sufficient expertise in executing large scale I C T projects to implement eRwanda without considerable input from experts in the area.

Broad vs. narrow focus

The range and the scope o f the project were given substantial consideration during preparation. Although eGovernment reforms are by their very nature broad in impact and implication, it was decided to focus the project on establishing the basic foundations for ICT-supported delivery o f public services. The reforms proposed under the project are the necessary conditions for the success o f a longer-term program o f improving the efficiency and effectiveness o f government services through the use o f ICT.

Integration into PSCBP

The project team originally considered modifying the PSCBP to address the issues targeted under the proposed project. Component 5 o f the PSCBP i s primarily concerned with I C T - and i t s three subcomponents form the rudimentary background for an eGovernment project. I t was decided, however, to propose a stand alone project, eRwanda, mainly because o f the complexities inherent in such an eGovernment project, and o f the special sk i l l s that are required to implement the eRwanda reform agenda.

Furthermore, because the eRwanda Project i s a fundamental part o f the N I C I I1 Plan, the Government has requested that implementation o f the Project be closely aligned with RITA, which i s the implementing agency for the N I C I I 1 Plan.

C. IMPLEMENTATION

1. Partnership arrangements

The Government o f Rwanda’s goal, as expressed in the Vision 2020 Statement, i s focused on transforming society from being agriculturally based to one which i s based on knowledge and information. The Government’s strategy has been made operational in the N I C I Plans, which specify the judicious and systematic use o f ICT.

Several development partners have been particularly forthcoming in their support for I C T in Rwanda. The Swedish International Development Agency (SIDA) provided logistic and staffing support to RITA, the Rwanda Information Technology Authority for over two years, has funded the creation o f the National Computing Centre and has contributed substantially to the infrastructure needs o f ministries. Additional support to RITA has been given by the Swiss Embassy in Kigali, U N D P and the EU. The EU has further provided sizeable support to office automation and a document management system for Parliament. USAID has contributed USD 1 mi l l ion for the Ministry o f Justice network system in 2003 and has financed connectivity as well as other I C T activities in schools and farmer’s collectives as part o f the Public Enterprise Administration and Reform Loan (PEARL).

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DfID has been a substantial contributor to ICT, especially in the field o f education - they have funded the Education Management Information System (eMIS) at the Ministry o f Education (MINEDUC) and have contributed to the development o f eLearning materials. They have also computerized the Rwanda Revenue Authority.

During pre-appraisal, discussions with the Japan International Cooperation Agency (JICA) yielded the offer to contribute two staff for two years to work on eRwanda. The GoR i s presently seeking additional support for the implementation o f i t s eGovernment strategy and action plan from i t s development partners. The African Development Bank (AfDB), the EU and DfID have indicated a strong interest to support this agenda.

2. Institutional and implementation arrangements

The eRwanda Project will be implemented by the RITA, which operates under the Ministry o f Infrastructure (MININFRA). RITA i s the Government body mandated to coordinate al l ICT projects. Working closely with RITA i s the autonomous Human Resource and Institutional Capacity Development Agency (HIDA) which i s the coordinating agency o f the Government’s umbrella program for capacity building , the Multi-Sector Capacity Building Program (MSCBP), which i s being supported by the World Bank’s PSCBP, amongst others.

The day-to-day operations o f the project will be ensured by a dedicated eRwanda implementation team headed by a full-time Project Manager. The team i s composed o f RITA staff fully integrated into RITA’S organizational structure. It has been agreed with the GoR that the eRwanda implementation team will be primarily development focused, although it i s recognized that significant ICT skills will also be required. Thus, the team will be multidisciplinary, with experts in institutional development, business process reengineering, training, capacity building, ICT, content development, financial management, and procurement. Additional assistance in change management, training and capacity building will be provided by HIDA. The work o f the implementation team will be complemented both conceptually and technically by other teams in RITA and in other institutions, in particular by the N IC I I1 Implementation team and the National Computing Centre.

The eRwanda team’s work will be guided by the Project Operations Manual (which includes the Procurement Procedures Manual and the Finance Manual), and i s supplemented by the Procurement Plan. This documentation i s further enhanced by the Project Implementation Plan.

I t i s envisaged that the project will finance salaries o f the eRwanda implementation team during a transition period within which the GoR will integrate the salaries into the annual budget. The transitional funding would also allow government to work out an incentive scheme -- consistent with existing salary ru les and regulations -- that i s able to attract qualified personnel into the public sector. It i s programmed to fully integrate the costs o f project implementation into the budget for the year 2008.

Oversight over the project will be provided at three different levels:

0 Technical oversight will be provided by the RITA Management Team comprising al l Heads o f Departments and by the RITA Board o f Directors comprising representatives from the government, the private sector and civil society. The Management Team meets

11

on a bi-weekly basis; the RITA regulations foresee up to twelve meetings o f the Board o f Directors per year. Technical discussions will be based on a monthly progress report prepared by the eRwanda implementation team.

Political oversight will be ensured by the Minister o f State for Energy and Telecommunications, who reports to Cabinet about the implementation o f eGovernment reforms on a quarterly basis. The reports to Cabinet are based o n quarterly status reports prepared by RITA.

0 Quality assurance will be ensured by a team o f international experts (Quality Assurance Group) who will be invited to provide conceptual and technical guidance for the implementation o f eGovernment reforms. This team will consist o f practitioners from other countries which have implemented similar reforms. This group will review the implementation status o f eRwanda every six months; it will make recommendations to facilitate the implementation o f the reforms. The report o f the group will be discussed at the technical and political levels.

3. Monitoring and evaluation of outcomes and results The project will be integrated into the GoR's comprehensive M&E system framework which has been set up to monitor the implementation o f the different reform programs initiated by the GoR.

For the M&E o f the project itself, the RITA implementation team will work very closely with KIST3 to put in place a dedicated M&E system with clear indicators and a standardized methodology for collecting and analyzing information. In addition to this, external evaluations (including a quality assurance mechanism, see above) and impact assessments will be carried out on a regular basis to assess progress and impact o f eGovernment reforms.

The project will also institute regular client feedback and survey mechanisms. An early social impact assessment will be performed and this will be repeated at mid term. Similarly, a baseline survey for the I C T industry was initiated during project preparation and will be repeated two years after effectiveness. Economic and financial analysis studies were also undertaken during project preparation, forming a basis for evaluating the effects o f the project.

4. Sustainability

Critical factors for the sustainability o f project benefits are:

Degree o f government's commitment during project implementation Despite the high risk to implement such a complex reform program, continuous government commitment i s expected because o f the broad consensus within government about the need to use I C T as an enabler for the development o f the country.

I t i s also recognized that commitment to a policy or strategic direction i s insufficient to realize success. The init ial eGovernment strategy (NICI I) did not achieve i t s objective due to many factors, including lack o f sufficient funds, unclear targets, lack o f skilled

The management o f KIST has welcomed the idea o f establishing a center for M&E o f the ICT sector, to both monitor the eRwanda and NICI I1 Plans, as well as to help foster a culture o f M&E throughout the country.

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personnel, insufficient project management, a weak infrastructure and a slow start. Nevertheless, the GoR has made significant progress in strengthening RITA and gearing up the entire government towards the achievement of the new eGovernment action plan (NICI 11).

Capacity to effectively manage the project implementation

Significant efforts have been made to address potential implementation bottlenecks: project implementation will be based on a carefully sequenced action plan with clearly identified milestones which will be independently monitored and evaluated. To assess project implementation team's performance, a particular emphasis will be placed on tangible results to be achieved within a specific timeframe which would allow necessary adjustments in case o f delays and other implementation difficulties.

0 Capacity and incentives to institutionalize the project The project will put some burden on the administrative capacity o f government machinery to effectively deal with the significant changes triggered by the introduction o f modernized business processes supported by ICT. The targeted institutions will need to dedicate a substantial amount o f their (rather limited) administrative capacities to integrate the new approach into the existing institutional structures and procedures. To address these challenges a significant amount o f training and capacity building has been built into the project to ensure that the changes introduced by the reforms can be adequately dealt with. The complementary PSCBP will provide additional assistance in the areas o f business process reengineering, change management and capacity building.

Degree o f government's commitment beyond the implementation o f the project The Government will need to ensure sustainability o f the reforms beyond the implementation o f the project. To this end, it i s envisaged to progressively integrate the costs for modernization, further equipment, training and capacity required to maintain and sustain the intended reforms into the annual budget.

Building enduring ownership and support While ownership and support for the different components o f the project are strong, the Government must ensure that this support i s adequately maintained during and beyond the implementation o f the project. Complex systemic and institutional changes which are part o f the reform *agenda will only be effective if they are widely publicized, accepted and integrated into day-to-day operations. The Government will monitor the effectiveness o f the reforms triggered by the project on a regular basis - based on periodic independent evaluations. At the institutional level feedback mechanism and opportunities for process innovations (quality circles, focus groups etc.) will be established to guarantee ownership and provide upward feedback to management about the viability o f the reforms.

5. Critical risks

The program carries substantial risk (see detailed risk assessment below); it poses a significant challenge for the Government because o f the complexity o f the changes triggered by the project and the substantive capacity building needs to ensure success and sustainability o f the reforms.

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To mitigate the risks, the project foresees significant upfront investments in training and capacity building.

The Government o f Rwanda i s aware o f the risks o f undertaking a project such as this in an environment o f weak infrastructure and capacity but i s undertaking mitigation measures, as indicated below.

Risks Political commitment and leadership i s not maintained Too much emphasis on ICT rather than on capacity building and institutional development Lack o f sustainability in a country with huge budgetary pressures and low income levels

Low uptake o f the concepts o f eGovernment and lack o f behavior change, particularly in the rural areas

Poor electricity supply i s a major problem

Capacity (managerial, staff, administrative, technical) to implement reforms not adequate Lack and retention o f ICT Staff to handle complex applications: the current public sector pay scheme does not provide sufficient incentives to retain qualified ICT staff within the country Coordination with other reforms (e.g. PSCBP) i s not effective; other reforms do not sufficientlv contribute Absorptive capacity, due to weak procurement mechanisms, can cause substantial delays in implementation

Overall risk rating Legend: L = Low, S= Substanti

Rating L

S

H

S 1, H=Hil

Mitigation Continued high-level dialogue with GoR to reconfirm commitment Emphasize role o f ICT as an enabler for development and not an end it itself. Ensure close link to other development activities and projects, in particular the PSCBP. Over time, a variety o f interventions will collectively generate sustainable jobs and growth. Government will integrate recurrent cost requirements into the annual budget, as well as salaries after an initial period. Specific focus on the needs o f women and families in rural communities will help to achieve acceptance. Local language content, in voice and pictures, will be used to improve access and understanding. There i s an urgent electricity rehabilitation project and plans for methane extraction from Lake Kivu, which will contribute to solving supply problems in the long run. To mitigate the risk the project will develop a mix o f energy solutions for the public access points, in particular in rural areas. Reforms (eRwanda and complementary reforms under PSCBP) envisage comprehensive training, capacity building, coaching and specialized technical assistance. Public sector pay reforms are underway. Private sector institutions will be strengthened to provide programming for applications and continued support and maintenance o f technology. This project envisions a twinning arrangement between IT experts and Rwandans, leading to a cadre o f well- developed IT management staff to complement technicians. Continued high-level dialogue with GoR to ensure reform coordination beyond eRwanda, and alignment o f interventions.

Considerable efforts are being made to increase the number and quality o f procurement staff who are qualified to handle the rigors o f WB procurement. I t i s recommended that a separate procurement unit in RITA, reporting to the Executive Director, be established.

1

6. Board conditions and covenants

Conditions for Board Presentation -- The following conditions have been fulfilled: 0 Adoption o f a satisfactory Project Implementation Plan by the Recipient and the Project

Implementing Entity; and

Execution o f a satisfactory Subsidiary Agreement by the Recipient and the Project Implementation Entity

0

7. Grant effectiveness conditions and covenants

Conditions for Effectiveness 0 A Project Operations Manual (financial procedures manual, procurement procedures

manual) acceptable to the Association prepared and adopted;

0 RITA implementation team staffed (appointment o f Project Manager, a financial management specialist and a procurement specialist); and

Financial Management System satisfactory to the Association installed and capable o f producing Financial Monitoring Reports acceptable to the Association.

0

D. APPRAISAL SUMMARY

1. Economic

This project i s expected to have important economic returns in both urban and rural areas. The economic benefits o f the project however are difficult to quantify at this stage not only in Rwanda but other countries as well. This i s because economic costbenefit analysis o f eGovernment projects i s in an incipient state, with various approaches taken by different governments in both developed and developing countries. Methodological approaches include assessing monetizable economic efficiency gains, non-monetary gains, and such benefits to citizens as time and cost savings (e.g., transportation costs). Many social effects as well as benefits that accrue from public administration activities stem from increased coverage and penetration using digital communication over telephonic and optical networks penetration.

Data for measuring effects o f eGovernment i s a key constraint in Rwanda as well as in many other countries. Much o f the data will be generated during the project to form a baseline by which to begin to measure the economic effects. These data include number o f staff working in eGovernment versus total number o f staff, cost o f respective staff, cost savings on staff (fewer staff, higher efficiency implications), cost o f hardware and software, global investment needed to deliver improved services and share o f eGovernment, time efficiency, time savings (e.g., average waiting times), integration o f services effect, and cost o f training and related consulting services over time.

2. Financial

As in the economic assessment, the financial returns o f the eRwanda Project cannot be easily quantified but are expected to be significant. One o f the important impacts o f the project would be to reduce the transaction costs for citizens to access basic government services. In addition, information needed to access services in this mostly rural country would be made available using

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innovative approaches including strategically located kiosks in different geographic regions as well as incrementally developing eGovernment coverage across the country. This should increase the capacity o f local government as well as the efficiency o f services provided and reduce government procurement costs. The private sector can also be expected to benefit by the provision o f technical services to public and private sector beneficiaries. Another substantial benefit to the private sector will be increased opportunities to bid on the various contracts which will be generated by the project.

The fiscal impact will result from the use o f public investment funds to implement I C T reforms and to develop appropriate infrastructure in rural and urban areas as a part o f a phased I C T development strategy. Additionally, the recurring cost o f operations and maintenance (assumed to be at least USD 1 mi l l ion per year) will affect the public budget.

3. Technical

The project will support the development o f a common IT architecture fi-amework commensurate with national I C T policy. Government capacity will be built to select, design, and implement I C T programs and participate in eGovernment activities. Additional capacity building opportunities activities will be provided to manage I C T investments and deployments consistent with this architecture. I C T infrastructure will also link to the implementation o f a national infrastructure network in collaboration with ongoing regional infrastructure initiatives.

4. Institutional

The project, which builds on the PSCBP, will be implemented by the Rwanda Information Technology Authority (RITA) which i s tasked with overall responsibility o f the National Information and Communications Infrastructure Plan (NICI), under the direction o f the Ministry o f Infrastructure (MININFRA). Within RITA an embedded team, dedicated eRwanda, will be headed by a full-time Project Manager. The team comprises existing RITA staff; additional staff will be hired to cover other competence areas. The Project Manager i s integrated into RITA’S management structure and reports to the Executive Director. The Executive Director i s accountable to the RITA Board o f Directors which ensures oversight and comprises major stakeholders, including representatives from the Government, c iv i l society and the private sector. Political oversight will be provided by the Minister o f State for Energy and Telecommunications who reports to Cabinet about the activities o f RITA including progress in implementing eRwanda on a regular basis. Details about the implementation arrangements are summarized in Annex 6.

Procurement: Procurement will be carried out by a dedicated Procurement Specialist, currently being recruited by RITA, following the project’s Procurement Plan, and in l ine with World Bank Procurement Guidelines. The Procurement Specialist will report to the eRwanda Project Manager and be permanently housed in the Administration and Finance Unit o f RITA. Transitional arrangements have been put in place to build relevant capacity within RITA and to ensure adequate implementation o f the eRwanda procurement plan. Details about the procurement arrangements can be found in Annex 8.

Financial Management: A financial management assessment has been carried out to determine if the Bank’s financial management requirements would be met under the project. It i s

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anticipated that the accounting, reporting and internal control systems o f RITA which are presently being revised will meet the Bank’s minimum requirements for financial reporting. RITA will hire a Financial Management Specialist for the financial operations o f eRwanda. A comprehensive financial management system and manual i s under preparation to ensure adequate financial management capacity within RITA. Details about the financial management arrangements are summarized in Annex 7.

5. Social

One o f the key project objectives i s to ensure that government services are delivered effectively and equitably to all Rwandans, especially the poor and disadvantaged. T o this end, the project focuses on the vulnerable population in rural areas. These include women, farmers, and traders o f a l l ethnicities and backgrounds. When viewed within socio-cultural, institutional and political contexts, the projected rural impact areas pose potential constraints and opportunities. These include key poverty, legacy, gender and other demographic and institutional factors. The project aims at ensuring transparency and an equitable allocation o f project benefits to al l social groups based on need.

Rural demography: Over 90 percent o f Rwanda’s population live in rural areas where the Government’s technical and infrastructure capacity i s limited and varies widely across the country. This resource deficiency in the public sector i s further exacerbated by “rural poverty,” which hinders adequate access, social and economic mobility, and participation by citizens in government programs. Furthermore, illiteracy, which i s estimated at 50 percent o f adults in rural areas, creates additional challenges for ensuring equitable access to public services for all. Finally, the degree o f variance in local capacities across the country points to the need for equitable benefit allocation, especially in those geographic areas with perceived high socio- cultural sensitivities.

Gender: Women o f rural Rwanda are especially vulnerable to poverty and health risks, as indicated by small-scale household, maternal mortality and AIDS epidemic indicators. The project objectives are guided by the Government’s ambitious target to increase significantly female representation in decision-making capacity and roles for ensuring adequate attention to pertinent policies and plans and to foster gender equity in public service delivery.

Government Decentralization: In the institutional context, the project’s role in supporting the decentralization process o f government functions may potentially amplify the challenges inherent to government restructuring that involve the interests o f both the civ i l servants and citizens/stakeholders. The project aim i s to mitigate this potential risk through regular participatory collaboration with the Government and public stakeholders, and by ensuring that the benefits provided to both groups are equitably allocated.

History: The legacy, ethnicity-based ideology and the genocidal war cannot be ignored when assessing public perception and the Government’s culture and composition in relation to the objectives o f eRwanda and the respective allocations of the project benefits. The project’s aim i s to ensure transparency and monitor the representation o f diverse social groups, as well as plan for their needs.

17

Participatory approach: Extensive stakeholder workshops were held during preparation o f the project and are planned during implementation to regularly monitor project results and impact.

Consultations and coordination with NGOs and donors: SIDA i s providing support to RITA, i s working closely with the Government o f Rwanda, and has asked to be kept informed about the development for the eRwanda Project for possible funding support. Additionally, UNDP has launched two initiatives directly supporting ICT development in the country: (i) support for the development o f ICT policies and standards at the ministerial level; and (ii) a study o f public information kiosks. UNDP i s also funding the document delivery system and other key applications. The project team i s working closely with UNDP to coordinate activities to maximize synergies. Consultations were also held with USAID, which i s funding the Last M i l e Initiative for the coffee cooperatives and private sector strengthening.

6. Environmental

There are no major environmental issues associated with the eRwanda Project which i s an ICT and e-applications project and focuses on institution-building activities including computerization and IT enabled management systems to facilitate public sector reform

7. Safeguard Policies

Safeguard Policies Triggered by the Project Yes N o Environmental Assessment (OP/BP/GP 4.01) [I [XI Natural Habitats (OPBP 4.04) [I [XI Pest Management (OP 4.09) [I [XI Cultural Property (OPN 11.03, being revised as OP 4.1 1) [XI Involuntary Resettlement (OPBP 4.12) [I [XI Indigenous Peoples (OD 4.20, being revised as OP 4.10) [XI Forests (OP/BP 4.36) [I [XI Safety o f Dams (OPBP 4.37) [I [XI Projects in Disputed Areas (OP/BP/GP 7.60)" [ I [XI Projects on International Waterways (OP/BP/GP 7.50) [I [XI

[I

[I

8. Policy Exceptions and Readiness There are no policy exceptions required.

* By supporting the proposedproject, the Bank does not intend to prejudice the final determination of the parties' claims on the disputed areas

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Annex 1: Country and Sector o r Program Background RWANDA: eRwanda Project

A. Introduction and Macro-Economic Situation

Country Background: Rwanda i s a small, landlocked central African country which has about 9 mi l l ion inhabitants4. With a per capita GDP o f U S D 230 and with-60 percent o f the population living below the poverty line, it i s one o f the world’s poorest countries. I t s population density o f 340 inhabitants per square kilometer i s one o f the highest in the world; about 85 percent o f the population lives in rural areas which are characterized by marginally productive lands. Rwanda’s economy i s largely agriculture based, accounting for about 41 percent o f GDP but over 80 percent o f the population. Services make up 38 percent and consist mainly o f wholesale and resale trade in various products, transportation and public administration. Industry accounts for 21 percent o f GDP o f which manufacturing accounts for 8 percent and construction 11 percent. There i s a small but growing I C T industry, and this primarily serves the Government, which i s the largest employer.

GDP growth has recovered from 0.9 percent in 2003 to 4 percent in 2004, despite significant energy shortages, mainly driven by growth in construction, transport and information and communications sectors. According to the Ministry o f Finance’s statistics and as reported at the Development Partner’s Meeting in February 2006, GDP growth has reached 6 percent in 2005- 06 with inflation decreasing from around 10 percent in 2004 to 6 percent by end 2005 and 3-5 percent per year in the medium term. The country recently benefited from HIPC debt re l ie f which led to a reduction in the debt to export ratio to 150 percent by end-2003. Additional debt re l i e f will be forthcoming under the Multi-lateral Debt Rel ie f Initiative (MDRI). Relief from both the Bank and IMF under the MDRI has resulted in a further reduction o f Rwanda’s debt to export ratio to 58.5 percent by end 2005. Despite these initiatives, the country remains vulnerable to debt distress given the l o w export base.

Recovering from War and Genocide: Rwanda has made the remarkable transition from reconstruction to development. In the twelve years since the genocide, close to one mi l l ion people were killed, two mi l l ion were driven into exile, over 100,000 people were imprisoned, and thousands were handicapped physically and mentally. However, the legacy remains and the country i s likely to depend on significant levels o f external assistance for years to come.

B. The Country’s Development Strategy

In i t s Vision 2020 statement, the GoR envisions a transformation from a largely agriculture- based economy to a knowledge and information based economy, and to reach middle income status by 2020. This document was endorsed by Cabinet in 2000, after consultations with civ i l society and the private sector. The Government has emphasized i t s intention to use investment in I C T as the key driver for this transition and as a vehicle for improving the delivery o f public and private services, particularly in the rural areas. The Vision 2020 document, which has been made ‘operational’ through the National Information and Communication Infrastructure (NICI) Plans,

NOTE: Recent census indicates that the population i s growing rapidly, due to a high birth rate and returning diaspora. It i s expected that the population may double by the year 2020.

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lays out how this transformation i s to be achieved. The N I C I Plans are broken down into four 5 year plans, and Rwanda i s currently implementing N I C I 11.

The National Information and Communication Infrastructure (NICI) Plan: The f i rs t N I C I Plan was budgeted at USD 500m but was only partially funded and implemented. The Plan was primarily developed by U N E C A and was based on similar plans for other African countries. During i t s evaluation o f the plan in June 2005, the Government recognized the country’s shortcomings: lack o f sufficiently skilled staff to implement the projects, lack o f infrastructure to support the activities, insufficient understanding o f the role o f I C T in development; insufficient attention paid to the needs o f the communities and rural areas, and lack o f leadership. Nevertheless, investments in technology have achieved some success (such as the TracNet system for health, the provision o f computers to the primary and secondary schools, the installation and use o f the African Virtual University site) and they have provided a good foundation for eGovernment (such as the improvement o f office automation and linking o f the Ministries, the hiring and training o f I C T Directors for the Government, and the creation o f some rudimentary websites) and for future investments in ICT. The N I C I I1 Plans i s based on seven major pillars o f development (human capacity development; infrastructure, equipment and content; economic development; social development; eGovernment and eGovernance; private sector development; rural and community access; legal, regulatory and institutional provisions and standards). The N I C I I 1 plan has addressed many o f the shortcomings from the N I C I I plan; in particular, it i s more development focused and establishes more realistic results. The plan also enjoys a larger endorsement by Rwandan society.

C. Development Challenges in Selected Sectors

Public Sector Challenges: The genocide had a detrimental impact on the institutional and human capacity in the public sector. Even before the tragic events, institutions in the public sector lacked the capacity to fully promote equitable growth and access to services. Today, despite many efforts to strengthen capacities, i t s acute lack i s particularly pervasive in the public sector, where only 6.5 percent o f public servants have some university education and 2.7 percent have a university degree. Refugees, or descendants o f refugees, who returned to Rwanda since 1994 and found employment in the public sector have not fully compensated for lost skil ls. The substantial inf low o f outside, mostly Anglophone Diaspora has led to a gradual transformation o f formerly Francophone administrative system to increasingly Anglophone structures, thus adding an additional layer o f complexity. Many managerial, professional, and technical positions are s t i l l vacant or filled by expatriates or unqualified staff.

Public administration reforms: Initiated in 1998, the f i rs t phase (1 998-2000) o f reforms concentrated on asserting control over the establishment and the payroll, streamlining staffing and functions, improving and rationalizing remuneration, and reducing the size o f the civ i l service. Key achievements include: (i) eliminating ghost-workers following the 1998 civ i l service census; (ii) monetizing c iv i l service benefits and, increasing salaries by over 40 percent in 1999; (iii) initiating computerization o f human resource management and payroll systems; and, (iv) developing competitive and streamlined recruitment procedures.

First strides were made to rationalize ministerial functions, including the adoption o f new organizational structures, j ob descriptions and grading and the realignment o f public servants to

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new positions and grades. The introduction o f new organizational structures was partial and results were mixed. Realignment o f staffing to new positions and grades led to the retrenchment o f some 6,000 mostly unqualified and contractual staff at the central level, in addition to the removal o f some 6,500 ghost-workers from the payroll, reducing the staffing complement in the c iv i l service, including provinces and districts to about 9,500 compared to 15,000 in 1997.

The second phase o f reforms seeks to further previous achievements and transform the public service into a more accountable, transparent, efficient and responsive instrument in i t s size, structure, systems, procedures, practices, knowledge, skills, and attitude, on which the state can rely to achieve the will o f the people o f Rwanda. Rwanda's new public service law (July 2002) and Public Sector Reform Strategy, approved in December 2003 emphasize the following five strategic objectives: (i) realigning government functions and institutions in light o f the changing role o f the central government and local governments in service delivery, (ii) promoting public- private-civil society partnerships in service delivery, (iii) improving the capacity and performance o f public officials, including redeployment and retrenchment, (iv) establishing an autonomous Public Service Commission to introduce and manage merit-based recruitment and promotions and career development, (v) completing ongoing analytical work on pay reform and adoption and implementation o f a new pay policy, and (vi) promoting results-oriented management. These reforms also necessitate the promotion o f a culture o f information management and sharing within the Government. Two local training institutes were established to provide training o f public servants locally: the Rwanda Institute o f Administration and Management (RIAM) and the School o f Finance and Banking.

Implementation o f the Government's Public Sector Reform Strategy to date has included: retrenchment o f 2,000 c iv i l servants at the center and about 2,000 at provincial and district levels; reorganization o f al l central ministries, reducing them to 40-50 staff per ministry, hiving o f f al l service delivery and policy implementation functions to districts and secteurs, public agencies and private firms; an adoption o f principles underlying pay reform and an increase in pay by 10 percent by 2006; a drastic reform o f the management and financing o f the Government vehicle fleet which i s estimated to save the Government about RwF 6 bi l l ion per year and the establishment o f a Public Service Commission in M a y 2006. Changes are s t i l l ongoing and refinement o f policies needs to occur to help mature reforms and adjust for negative consequences. For instance, the reduction o f ministerial staff without a proper change management strategy in place leaves ministries unable to cope with regular work loads and lacks the capacity to devise, implement and monitor and evaluate reforms. The new strategic plan for MIFOTRA provides an opportunity to readjust and mature where necessary.

Public expenditure management reforms: In 1998 the prioritization o f budget allocations was introduced, mandating increasing allocations for identified budget priorities, initially education and health. Budget management has been de-concentrated, as l ine ministries became actively involved in budget preparation, and consultations with c iv i l society on the budget are now carried out. New institutions promoting good governance have been created since 1994 to foster accountability and transparency in budget execution and financial control, such as the Office o f the Auditor General, National Tender Board, the Rwanda Revenue Authority, and CEPEX, the Central Public Investments and External Financial Bureau.

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Key challenges include: (i) strengthening the legal and regulatory framework, including enactment o f the new Organic Budget L a w and the issuance o f financial instructions; (ii) introduction o f a comprehensive and integrated accounting system; (iii) production o f annual financial statements o f the Government and reduction o f the number o f government bank accounts, (iv) improving budget coverage to include al l donor-financed expenditures and spending agencies’ own revenues; (v) establishment o f an effective internal audit; and (vi) mobilizing and training accountants and auditors.

To take stock o f improvements in public expenditure management and to identify key areas for further improvements, the GoR undertook in 2002-2003 a financial accountability review (FARAP) with key donors (DFID, the World Bank, and UNDP).4 Key issues identified in the FARAP include: prevailing weaknesses in the country’s legal, institutional and regulatory framework, leading to incongruent financial management practices across government agencies; weak capacities, and lack o f clarity regarding the roles o f different institutions. The institutional characteristics o f government financial management are centralized rather than decentralized, making cost-center management more challenging. The failure to produce consolidated government accounts undermines the credibility o f achievements made thus far in financial accountability.

To operationalize FARAP recommendations the GoR i s preparing a Public Financial Management Capacity Building and Technical Input Plan with support from the European Commission, to identify activities, financial requirements, responsibilities, a timetable, and performance indicators. The donor community, including the World Bank, i s committed to supporting efforts in developing capacities for sound financial accountability. This support focused primarily on establishing a modern budget management and accounting system.

Public procurement reform: The public procurement system i s presently not in l ine with international standards although public procurement reforms are well underway. A new draft procurement code has been prepared which reflects the recommendations o f the Rwanda Country Procurement Assessment Review (CPAR) o f June 2004.

Key challenges for the next phase o f the reform include improving procurement capacity at all levels o f government (central, provincial, and district), including the Community Development Committees, and to develop national training capacity on, among others, processing o f standard bidding documents, guidelines, and manuals.

Decentralization and recent terr i tor ial reforms: The Government o f Rwanda adopted a National Decentralization Policy in M a y 2000 to promote good governance; pro-poor service delivery; and sustainable development. The decentralization process has gathered speed in 2005 through the decision to reduce the number o f administrative entities and devolve responsibility for service delivery, thus drastically changing the current set-up o f . territorial administration. Effective January 2006, there are 4 provinces; Kigal i City Council; 30 districts; 416 sectors; and 9 165 cells. Under the reform, sectors have acquired main responsibility for service delivery; they

Other main diagnostic activities include the Public Expenditure Management Review (PEMR) and the I M F Report on the Observance o f Standards and Codes. The GoR also prepared a diagnostic report on decentralization, “Appraisal of the Decentralization Process in Rwanda”, issued in September 2003.

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will ensure coordination and the management o f several basic services such as local development planning, local tax collection, statistics, education and social affairs, land planning, housing, and local infrastructures, etc. Districts, as a legal decentralized entity, are responsible for overall coordination o f economic development, and ensuring the coordination o f planning, financing and implementation o f service delivery at sector levels as well as promoting cooperation with other local governments.

The territorial reforms present a unique opportunity for realizing Rwanda’s vision o f better and more accountable services, especially for the poor and vulnerable. The streamlining o f Rwanda’s provinces and local governments (districts, secteurs, cells) means that roles and responsibilities at al l levels, and within al l sectors, are clarified and that adequate financing and staffing arrangements are put in place. To support districts in their new roles, component one o f this project provides support to the District Offices to enable them to perform their functions. The GoR i s currently in the process o f preparing and refining the regulatory framework that governs the relationships between central and decentralized authorities.

Challenges in social sectors: The main challenges in health and education are related to the difficulties in serving a poor and decentralized rural population, the lack o f skilled medical staff and educators, the difficulty in obtaining and distributing materials for clinics and educational institutions, and the lack o f reliable electrical and water supplies. This coupled with a high adult illiteracy rate makes reaching vulnerable families al l the more difficult. It i s estimated that nearly 50 percent o f the adult rural population are illiterate in their native language, Kinyanvanda. The private sector i s nascent but rapidly growing, particularly in the fields o f construction, telecommunications infrastructure, and ICT. Rapid increases in service activities (including the financial sector, media, commerce and exports) are also fueling economic growth, much o f which i s occurring in the private sector to support government programs. Investments in both education and health have yielded substantial benefits.

Gross enrollment in primary education has r isen rapidly to 13 1 percent and net enrollment i s at 95 percent. The target o f universal primary education by 2015 seems feasible, but the primary education completion rate needs to improve to keep Rwanda on track for the Millennium Development Goals. Rwanda has been able to achieve these rapid results through the Government’s policy on free primary education, which was initiated in 2004. The gross enrollment rate at the secondary level, however, i s quite l o w at 15 percent. The Government i s actively tackling these concerns through policy commitments to fee-free nine-year basic education (aiming to double the transition rate from primary to first year o f secondary by 2010), and by adopting measures to improve the quality o f education through reforms in teacher training (approved by Parliament in 2005) and updated curricula to provide stronger incentives for learning. Parliament passed the Ministry o f Education’s new National Science, Technology and Innovation Policy in 2005. This will eventually change curricula at al l levels o f education, to support Rwanda’s move toward a knowledge-based, technology-led economy. The Science policy i s systematically linked with the objectives o f the Poverty Reduction Strategy, to maintain the viability o f rural areas, and Vision 2020. At tertiary education level, the Higher Education Bill was passed in 2003, and the Students Financing Agency for Rwanda and the National Council for Higher Education were established.

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In health, Rwanda’s immunization program i s considered one o f the best in sub-Saharan Afr ica with a coverage rate o f 85 percent for DPT3, relatively l o w drop out (DPTlDPT3) and limited inequities. Infant and under five mortality have dropped gradually and have now reached pre- genocide levels. Access to other basic health services (e.g. assisted deliveries, family planning) i s also improving. However, much more needs to be done to address chronic malnutrition (Le. which affects 45 percent o f children under five) as well as other childhood i l lnesses (i.e. only about hal f o f children who had a respiratory infection or fever consulted a medical personnel and only a quarter o f those who had diarrhea, 2005 DHS). The Ministry o f Health in collaboration with stakeholders has revised the Health Sector Policy as part o f the process to move towards sector-wide approach (SWAP). A Health Sector Strategic Plan i s under preparation which, together with the Poverty Reduction Strategy, represents a sound basis for addressing disparities in health outcomes and service provision. Performance based payment schemes, where health providers are encouraged to improve performance o f their services, have been successfully piloted in two provinces. The 2005 APR points out that reducing the maternal mortality rate towards the MDG in 2015 i s a major challenge for Rwanda due to the high cost o f delivering quality obstetrical services.

D. eRwanda and ICT Readiness

Request for eRwanda: In June 2005, the GoR approached the World Bank to fund an eRwanda Project, as a subset o f the N I C I I1 Plans. While eRwanda cannot fund the entire plan, this project focuses on the core activities which will bring the greatest positive result for Rwanda. The project described herein i s a microcosm o f the entire N I C I Plan, for it has activities which address al l seven pillars o f the Plan. For example, while the project necessarily focuses primarily on the eGovernment pillar - with classic eGovernment applications such as improvements in the financial management, content management, citizen’s services, and internal government infrastructure - other activities address the need to develop the human capacity o f Rwandans to manage and use technology, provide for direct funding o f infrastructure within the Government offices, create opportunities for the improved growth in the I C T industry and the larger Rwandan economy, have direct impact on the social fabric o f society by addressing the service delivery and information needs o f the rural populations, and strengthens the underlying legal and regulatory framework for development o f the Vision 2020.

Rwanda’s Readiness for eGovernment: To fully maximize and exploit the inputs, the Government understands that it must provide for a sound foundation upon which future investments can achieve their maximum benefit. According to the 2005 African e-Index, penetration o f and access to telecommunications (including fixed telephone lines, internet and mobile) i s amongst the lowest in the world, especially in rural areas, and prices for services, notably mobile telephony, are very high. The I C T infrastructure such as telecommunications and electricity i s weak. The single most serious impediment to I C T development i s the lack o f human resources, both in technical areas as well as in policy-making.

Yet, the African e-Index concludes that demand for communications services i s high. Coupled with strong commitment for promoting I C T for development at the highest level o f government, it presents a significant opportunity for business development if the Government can create the necessary pol icy and regulatory environment and address energy shortages. For the Government it i s not a choice between the development o f I C T or investments in the social sectors such as

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health and education. I t i s the recognition that the combination between I C T development and investments in the social sectors will potentially yield the greatest benefit, for technology will enable the Government to reach i t s goals in the most efficient and effective way possible.

Prior to the genocide in 1994, Rwanda was characterized as having a weak infrastructure and was not considered to be attractive to investments. This lack o f readiness to accept technology was dramatically turned around by the Vision 2020 and the N I C I plans which achieved a remarkable level o f computerization in the twelve years since the genocide. Currently, al l ministries in Kigal i have reached some level o f office automation, with the Ministr ies o f Health, Education and Finance being the most developed. Fiber optics link most o f the ministries but there i s no shared email service, no government document database, and the sk i l l s within the ministerial staff are weak. Few ministries have properly functioning LANs, there i s no standard hardware or software (the vast majority o f computer equipment was donated by development partners, causing a support and maintenance nightmare), and no standard pol icy for application development. Yet, the Government created RITA, the Rwandan Information and Technology Authority, in the early 2000s, specifically to coordinate all I C T investments and to ensure their viability. RITA i s actively working with al l facets o f government and there i s every indication that the N I C I I1 Plan will be better funded and implemented than N I C I I.

'

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Annex 2: Major Related Projects Financed by the Bank and/or other Agencies RWANDA: eRwanda Project

I

Key: U=Unsatisfactory;

A. Major Related World Bank Projects

_I

MS=Moderately Satisfactory; S=Satisfactory; HS=Highly Satisfactory

Sector Issue Project

Integrated Management o f Critical Ecosystems Project Multi-Sectoral HIV/AIDS Project Rural Sector Support Project Human Resources Development Project Urgent Electricity Rehabilitation Project Competitiveness and Enterprise Development Project Decentralization and Community Development Project Public Sector Capacity Building Proiect

I Bank-financed

Latest Supervision ISR Ratings

(Bank financed only) Implementation Development Progress Objective

S S

S S

S S

U U

MS MS

S MS

S S

S MS

Environment

Health

Rural Sector

Education

Energy & Mining

Private Sector Development

Social Protection

Public Sector

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B. Donor Support to Public Sector Reforms and ICT

Sector Issues Public financial management and monitoring and evaluation Human resource development

Institutional development and agency

Donor Agencies DfID, UNDP, AfDB, EU,

DfID, UNDP, AfDB, EU, Netherlands, SIDA, USAID, ACBF, GEF, FAO, SNV, IRC, UNFPA, French Cooperation, USISS, IFAD, Norway, CAREKanada DfID, UNDP, Netherlands, SIDA, USAID,

performance Support to Parliament

UNICEF, AfDB DBD, UNDP, AfDB, Netherlands, USAID,

ICT

I development Source: PSCBP PAD, June 2004 and discussions with development partners

SNV, Italian Cooperation UNDP. SIDA, USAID.

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Public private partnerships Legal and judicial reform Governance and anti-corruption Decentralization and community

DfID, EU, SIDA, USAID, UNDP, GTZ, Canada, Netherlands, UNDP, Netherlands, USAID, UNDP, Netherlands, SIDA, USAID,

Annex 3: Results Framework and Monitoring RWANDA: eRwanda Project

Table 1: Results Framework

PDO

I The key objective o f the project i s to improve (i) efficiency and effectiveness of some internal processes o f the Government o f Rwanda, and (ii) the delivery o f services in selected key sectors including better access to information through the use o f technology.

Intermediate Outcomes ; Component One: a) Extension o f and improvement in the physical infrastructure to support effective delivery o f such applications

b) Establishment and improvement o f robust Government Portal which links targeted institutions

Project Outcome Indicators

Number o f targeted government institutions5 which demonstrate improved internal efficiency in the delivery of services and information to citizens.

Intermediate Outcome Indicators

Number o f targeted institutions6 who participate in Government Portal with well developed internal and external websites.

Use o f Project Outcome Information

To determine whether the project achieved what it set out to achieve and in order to substantiate the results To be able to take corrective actions and plan To evaluate the performance and effectiveness o f the intervention To assess against other benchmark cases To identify and integrate good practices

Use o f Intermediate Outcome Monitoring

Indicates the change in the ICT penetration, deployment and use within government including:

Whether intervention contributed to the use o f ICT by government employees

Whether there was a change in the data availability and transparency within government

Whether the officials access and use the additional data

Whether there was a measurable increase in digital content

Whether the internal systems have the capacity to support the citizen services

Maximum number o f Ministries who could be targeted i s 27. Maximum number o f institutions who could be targeted i s 27.

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Intermediate Outcomes

Component Two: a) More efficient delivery o f government services to citizens and the private sector through the use o f ICT applications

b) Provision o f relevant information to targeted population, through a variety o f dissemination methods

c) Provision o f public access points (kiosks) distributed throughout Rwanda which provide access to information and to government services

Component Three: Improved ability o f RURA to regulate the telecom and energy sector

Improved telecommunications and energy reliability to the Ministries, District Offices, Provincial Offices and Kiosks.

Component Four: Project management

Intermediate Outcome Indicators

Number o f targeted public services (applications, maximum 4) available through improved delivery mechanisms which are functional and easy to use

Percent of users who express satisfaction with the services and information provided by the Government Portal.

Improved ability o f RURA to monitor and evaluate the telecom and energy operators’ adherence to regulations as evidenced by percent completion o f work plans

Percent targeted District offices, provincial offices and kiosks with reliable telecoms and energy during regular office hours

Percent increase in communication and data exchange within the Government (central government, provinces and districts) as measured by the number connections and/or amount o f data transferred as measured against the baseline

Percent adherence to fiduciary requirements o f World Bank (by RITA) with respect to project management

Ability o f RITA to use M&E information for better project management.

Use o f Intermediate Outcome Monitoring

Quality improvement (time, money) o f electronic government services over paper and manual transactions.

Level o f demand for eGovernment services indicating successful implementation o f eGovernment

Level o f reliability and acceptance o f community to electronic services

Determination o f locations o f future kiosks

Feedback to Ministries so that they can better target their information services.

Shows if the project’s interventions were successful in strengthening RURA’s ability to manage the sector.

Shows if investments in telecoms yield benefits beyond the sector.

Shows that training programs in finance, procurement and M&E adequately prepared the project team to undertake World Bank project work.

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Arrangements for results monitoring

Rwanda does not currently have a comprehensive M&E mechanism in place, nor i s there a culture o f monitoring o f the use o f investment funds. Therefore, i t i s not feasible to employ government staff for this purpose, nor i s i t possible to find a firm who can handle M&E for the project. Instead, the project wishes to take an innovative approach to M&E, namely, to build this capacity into an existing institution, KIST. While the immediate requirement i s to establish a good monitoring and evaluation system for the eRwanda project, it behooves the GoR to establish one for the entire N I C I I1 plan. If possible, the GoR would like to establish this capacity within KIST, which already has a good educational system in place and which trains the future leaders o f the country. eRwanda will use standard and innovative monitoring tools to track progress against specific objectives and indicators, and has proposed to establish a function within KIST for this purpose, and use the KIST students to gather, analyze and report on the data, which would achieve a number o f very positive outcomes, including:

a) building the capacity o f the students to perform this important function;

b) providing RITA and the eRwanda team with the reports for which it can report on progress o f N I C I and eRwanda;

c) providing KIST with verifiable data for i t s own publications;

d) fostering a culture o f measuring results against objectives; and

e) developing a new curriculum l ine for the organization, thus strengthening i t s already impressive offerings.

This proposal has received favorable response from the Rector and Vice-Rector o f KIST, who are keen to establish an M&E center within the organization.

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I

g

g

g

3 -

3 -

3

J 1 % r- N

3 m s

3

s VI r- s vr N

g 0 3 3 0 0

Annex 4: Detailed Project Description RWANDA: eRwanda Project

A. Introduction

In the early 1990s, Rwanda’s telecommunications operations relied primarily on telex and telephone. The telex system, a 1850s technology, used a slow but reliable network which was pervasive in Eastern and Southern Africa until very recently. There was a telephone system which served the capital and several larger towns, but it was very unreliable and limited in scope. The genocide o f 1994 destroyed the country’s main telephone switch and also damaged electricity and water systems, crippling basic infrastructure for most o f the country. These systems were reestablished shortly after the conflict, but the late 1990s were s t i l l characterized by systems failures and lack o f pervasiveness throughout the country.

In 2000, a new development strategy for Rwanda was approved, the Vision 2020. It aims at transforming the country from an agriculturally based economy to one based on knowledge and information, bypassing the ‘industrial age’. The Vision 2020 was made operational through the N I C I Plans. Based on these plans, the Government started to actively invest in technology and to encourage development partners to support these activities. The Government also provided funding for the establishment o f the Rwanda Development Gateway Group,’ which promotes the use o f technology at al l levels o f the society.

The development partners, such as DBD, USAID, SIDA and others have supported Rwanda’s vision through a variety o f investments such as installing computers in schools, establishing rural connectivity for coffee collectives, strengthening RITA with staffing and expertise, and developing a management information system for education. In the process, a lot o f technology was introduced to Rwanda, and people have been trained in how to use it. While these investments made some difference in the targeted areas, their impact was limited because they lacked integration with other I C T developments; an overall I C T development strategy with clearly articulated I C T policies and standards was lacking, too. In addition, serious infrastructure and capacity constraints hindered the rapid deployment o f I C T throughout the country. To address some o f these issues the World Bank’s Public Sector Capacity Building Project i s providing support for the development o f a consistent I C T policy, the establishment o f I C T standards as well as for training and capacity building.

In essence, the combination o f technology inputs in a variety o f sectors and the support provided by development partners and private sector investors has resulted in an incoherent set o f activities, which form an incomplete basis for efficacious future investments.

To address these issues and to develop a systematic approach to current and future investments in technology i s one o f the main functions o f RITA. In this context, the eRwanda Project will assist RITA and the Government in implementing a development oriented approach to investments in technology that i s aimed at putting in place basic infrastructure and adequate capacity. The project aims at putting in place the basics for sound I C T investments, such as the establishment o f standard and equitable infrastructure, including proper support and

The Rwanda Development Gateway Group, RDGG, was founded in 2002 to promote the use o f the internet amongst all facets o f Rwandan society. The RDGG, which i s fhnded solely through the GoR’s own resources, has a three year budget o f USD 5 million. The RDGG, which i s a project under the Ministry o f Education, has three subprojects: the Rwanda ICT Training Center at KIST, the GIS Center at the NUR, and the Rwanda Development Gateway, at NUR.

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8

maintenance, for ministries and districts and at training their staff to have the capacity to fully utilize all systems. In addition, underlying mechanisms for the development o f a common set of data structures and systems will be established. RITA will also be strengthened to effectively coordinate al l I C T related activities. After these fundamental building blocks have been put in place, further investments will have a better chance o f reaching their full potential. O n top o f covering the basics in ICT, the project will further support the piloting o f a number o f eGovernment applications in various sectors. The goal here i s to establish credibility of eGovernment by showing tangible results within a two year time frame. Applications are chosen to be feasible and realizable within this two year time period and to have an impact on the l ives o f ordinary Rwandans. Once this credibility established, it i s anticipated that additional funding can be mobilized to further the use o f I C T as an engine for national development.

B. Potential impact o f the eRwanda Project

The eRwanda Project i s not about the use o f I C T for the sake o f technology, nor will it divert scarce resources to inconsequential activities. The project i s primarily concerned with the thoughtful use o f I C T to foster the implementation o f the Government's development agenda. In this context, eRwanda will contribute to the following MDG goals and objectives:

a) eRwanda will help improve the economic outlook in the country by providing opportunities for the I C T industry to thrive. By increasing the number o f contracts available to the private sector and by actively creating opportunities for an increase in technology related jobs, the project will help to reduce poverty by a small margin.

b) eRwanda will contribute to the goals o f improving the education system in Rwanda. While there are other projects which focus on achieving universal primary education and a reduction in illiteracy, the eRwanda Project can substantially contribute to these goals. One o f the targets o f the project i s to link district offices to ministries in Kigali. The Ministry o f Education, for example, intends to use this link to send electronic materials (curriculum, materials, etc.) to the districts where they can be printed and distributed to schools, thus obviating the need to purchase expensive books'. Documentation can also be placed online for direct access by schools linked to the internet, and the Ministry can use technology similar to the one used by TracNet" for monitoring school performance. eRwanda will also scan a special collection o f documents in Kinyarwanda and create an online full text database, both to preserve this national treasure and also to encourage reading o f the national language.

c) By encouraging and providing incentives for women's and youth groups to run kiosks or tele- centers, the eRwanda Project will help to promote gender equality and economic growth amongst vulnerable groups. An added activity could be the creation o f anti-AIDS clubs in the kiosks or high schools, combining activities and employment for youth with education in the prevention o f AIDS. Bringing these two concepts together, and working closely with the M A P Project, eRwanda can contribute to the joint goals o f AIDS prevention through information and computer literacy through computer clubs for students in high school.

Attention will be paid to ensuring that copyright laws are enforced in the distribution o f materials. 9

10 TracNet, an easy to use monitoring tool, i s being used to track the delivery o f service in the Anti-Retro Viral health clinics in Rwanda. This technology, which uses a simple ce l l phone and a back end database in the Ministry o f Health, employs text messages and can also be accessed by the Internet.

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d) The eRwanda Project will strengthen the Ministry o f Health’s ability to directly monitor service delivery o f clinics and hospitals through using a mobile cell phone based technology to collect data.

e) The eRwanda Project will encourage environmental sustainability and protection by making content on agriculture and the environment available to al l citizens. A pi lot project will be started in the first year o f project implementation which will develop specific content from the Ministry o f Agriculture and disseminate it through a variety o f channels targeted at communities, such as brochures, radio broadcasts, street theatre or online through the kiosks. Another example o f how the project could encourage environmental sustainability would be the collection, processing and dissemination o f environmental and weather conditions in various parts o f the country.

C. Project Components

Component 1 - Strengthening government effectiveness and efficiency (USD 3.80 million)

This component aims at improving government’s key internal systems to enhance effectiveness and efficiency. Ma in focus o f this component will be complementary support for three subcomponents: (i) strengthening Rwanda’s basic government intranet and portal offerings; (ii) upgrading o f facilities at the central ministerial and district leve l to improve the Government’s ability to deliver services and content to i t s citizens; and (iii) training and capacity building within ministries and District Offices. The project will build on already programmed support for P F M reforms under the World Bank Public Sector Capacity Building Project and i t s Multi Donor Trust Fund for P F M Reforms, by providing the infrastructure for the ministries and district offices to allow them to use it.

The project will support the continued development o f the Government Portal, which will provide a vehicle for ministries to develop and maintain their websites, offering important information to i t s citizens. This Portal will bring together, in one convenient place, l i n k s to al l government ministries, services and information. In addition to organizing the information in an easy-to-use platform, the Portal will also provide features which will be most useful to citizens, such as ‘frequently asked questions’, ‘frequently needed numbers’, and so on. The Portal will be available in English, French, and Kinyanvanda.

Specifically, the project will (i) develop I C T standards for the public administration, (ii) equip the core ministries, provincial and district offices with the basic minimum and equivalent infrastructure, (iii) put in place a network infrastructure (WAN) that connects all relevant institutions at the national and sub-national levels, (iv) establish a maintenance and support infrastructure for I C T applications and hardware, (v) complement training and capacity building activities in particular at the provincial and district levels; (vi) develop the framework for internet governance, covering intellectual property rights protection, electronic commerce, electronic signatures, and digital signatures. The project will also establish a minimum standard skill set for I C T workers in government.

Furthermore, to support the implementation o f the Government’s new decentralization agenda, a particular focus o f the project will be the improvement o f the efficiency o f district offices through business process reengineering, capacity building and the use o f modern technology. As the government intends to roll-out the public financial management system to al l districts, the integration o f this system into the operations o f the district offices will be supported. Building capacity at the district leve l will also facilitate the establishment o f a comprehensive monitoring

34

and evaluation system, because the district offices will be the collection points for al l data - modern technology and adequate training will help district staff to aggregate the data more easily and send it for additional processing to the central government.

A considerable amount o f training i s envisioned. Training will take place at three levels: a) for the I C T staff in each o f the Ministries and Districts; b) for the public access pointkiosk operators; and c) for the communities themselves in how to use the public access points.

A pi lot system allowing citizens to use their mobile phones to transfer funds and redeem them through post offices would enhance commerce and trade” and could possibly be used to pay bills as well.

Project funding would focus on technical assistance for business reengineering and back end system design (USD 0.4 million), on minor rehabilitation o f government offices (USD 0.6 million), on training and capacity building (USD 0.35 million), on upgrading systems and facilities (USD 2.0 million), as well as on operating costs (USD 0.4 million).

Since Component 1 i s so fundamental to the entire project, it i s envisioned to cost about USD 3.8 million, o f which nearly USD 2.0 mi l l ion are c iv i l works and goods/equipment. An additional USD 1 mi l l ion i s allocated to training, capacity building and consulting services, about USD 0.3 mi l l ion i s reserved for security and other internet governance activities, and hal f a mi l l ion i s allocated for operations and maintenance costs.

Component 2 - Improving service delivery to citizens and the private sector (USD 3.51 million)

This component will assist government to deliver improved services and information to citizens and the private sector. I t i s divided into three sub-components: (i) applications and services for citizens and the private sector; (ii) content creation, customizing and dissemination; and (iii) public access information points.

(i) Applications and services for citizens and the private sector: This subcomponent will address the public’s basic need for improved services in selected sectors. To this end, the project will support sector ministries in identifying specific services to be improved through the use o f I C T and business process re-engineering to make them more efficient and effective.

The project will also provide some seed funding to experiment with innovative approaches to improve delivery o f services in key sectors through the use o f ICT, such as eHealth12, eEducation’ , or eAgriculture :

This pilot application would use mobile phone text messages to transfer ‘airtime’ from one phone to another - a way o f facilitating the flow o f cash from one individual to another in an environment where few citizens have bank accounts let alone credit cards and banks are rarely found in rural areas. The phone could be used to transfer funds to a shop keeper, to pay a bill, to advance funds to an individual and so on. The Post Office, which has distribution points throughout the countryside, could be enlisted to ‘encash’ excess airtime, thus enriching its offerings and providing a stable, reliable environment for support o f the system.

eHealth uses ICT to facilitate the canying out o f a whole range o f functions in the health sector, from the doctor to the hospital or clinic manager, via nurses, data processing specialists, social security administrators and patients. Tools for health authorities and professionals as well as personalized health systems for patients and citizens are frequently deployed. Examples include health information networks, electronic health records, telemedicine services, personal wearable and portable communicable systems, health portals, and other tools assisting disease prevention, diagnosis, treatment, health monitoring and lifestyle management.

I 1

12

35

eHealth: The Ministry o f Health has requested that two o f i t s rural hospitals be connected to a central telemedicine system. The project can provide for this, including the training and capacity building requirements to maintain the remote system.

eEducation: The Ministry o f Health currently has a mobile phone based system which tracks delivery o f services and distribution o f drugs in antiretroviral clinics. A similar technology could be used by the Ministry o f Education to enable it to better track i t s delivery o f educational services.

eAgriculture: Another innovative approach supported by the project i s the use o f mobile applications to enhance the Government’s ability to collect and process crucial data related to food security, market prices and environmental use.

(ii) Content creation, customizing and dissemination: The main focus o f this subcomponent will be to improve the quality o f information that i s generated by the administration and to disseminate this information to beneficiaries and target audiences. The PSCBP i s supporting the development o f ‘Citizen’s Guides’ to various institutions to improve knowledge about and access to public services. The eRwanda Project will complement these efforts in two ways: first, i t will assist key government services (e.g., health, education, agriculture, and environment) to create and customize information that i s relevant to the population (e.g. information about prices for agricultural products, fertilizer use, environmental protection strategies and proposals as well as basic health and nutrition issues). Second, it will assist in the dissemination o f the Citizen’s Guides and the additional information to districts and local communities through public access points (see below) or through other means such as the internet, radio, brochures, etc. It i s envisaged to involve beneficiaries in content development and dissemination mechanisms to better focus public services and to determine what information i s essential for local communities.

Two other l ow costkigh impact projects which could contribute substantially to content development and dissemination are:

1) The conversion o f existing documents in Kinyanvanda into a format which i s accessible online. Discussions with the librarians at the NUR resulted in the request to preserve a unique collection o f books, manuscripts and articles which are, truly, Rwanda’s national treasure. This collection o f about 200 documents i s in poor physical condition but could be preserved electronically and made available through the eRwanda portal14.

2) The project can take advantage o f the Open Access Movement”, which can provide, free o f charge, online access to scientific and scholarly research texts to developing countries. Links to these journals, which number in the hundreds, would be provided through the Government Portal.

(iii) Public access information points: The project will fund the development and maintenance o f public access points in both urban and rural areas so that electronic services and information

l3 In eEducation, the Government has asked that the Ministry o f Education publish the results o f the national examinations o f the secondary schools online.

These materials can be converted to PDF, and placed online in full text so that they may be reused without damage to the originals, may be accessed from any location, and which would provide a useful link to the diaspora. There i s a short window o f opportunity for Rwanda to preserve these materials before they are destroyed by dust, microbes and mis-use.

14

For an overview o f Open Access, see http://www.earlham.edu/-peters/fos/overview.htm 15

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can be made available to the public. A variety o f business models will be explored (public, private, PPP) as well as different mechanisms for the ‘care and feeding’ o f the access points. Training for the public access point custodians (technical, financial, IT applications) will also be included. It i s envisaged to situate some public access kiosks in district offices as that would require very l i t t le additional investments, beyond providing such services to the district offices themselves, to ensure access to government services and to other information relevant for local communities. Other sites, not part o f the District Office model, will also be chosen for serve as comparators to help measure impact o f the intervention. In certain cases, some modest assistance for payment o f telecommunications charges can be offered.

Component two i s estimated to cost USD 3.51 million, which i s primarily divided amongst application development, public access technologies, information dissemination, and training and capacity building.

Component 3 - Improving access to services through enhanced infrastructure in energy and telecommunications (USD 0.82 million)

The Government has made significant strides in privatizing the telecommunications sector and establishing the Rwanda Utility Regulation Authority (RURA), a multi-sectoral regulatory agency.16 Bidding for the privatization o f RwandaTel was launched in April 2004, and the transaction was completed in October 2005. RURA has been established and the telecommunication department has been operational since the beginning o f 2003. Furthermore, the Government has made progress in improving legislation for and control over the telecommunication sector with the adoption o f a new sector law in 2001 (Law N044/2001 o f 30/11/2001) and a regulatory framework progressively liberalizing the telecommunication sector (e.g. Presidential Order N004/01 o f 15/03/2004, Ministerial Order No2/DC/04 o f 07/06/2004, Ministerial Order N09/DC/04 o f 07/06/2004).

However, structural issues s t i l l abound. In 2005, Rwanda s t i l l lacks decent infrastructure networks, connectivity, and effective enforcement o f the legal and regulatory regime. The penetration rate o f telephone services per 100 inhabitants i s very low, at 2.9 percent in late 2005 (0.3 percent for the fixed network and 2.6 percent for the mobile network). Telephone services in 2005 have been supplied by three operators: TERRACOM-RWANDATEL, incumbent operator, recently privatized, operates in the field o f fixed telephony; MTN R W A N D A C E L L has been supplying mobile telecommunication services since 1998 and ARTEL ensures satellite communication network (VSAT) in the rural areas since 2002. However, Rwanda i s moving from a monopoly to more competition. In 2005, the end o f monopoly status in fixed, mobile, and internet markets was announced: TERRACOM-RWANDATEL and MTN RWANDACELL will now compete in both mobile and fixed telephony. Electricity shortages continue to pose a challenge to provision o f telecommunications: only 6 percent o f the population has access to the electricity grid (20 percent in urban area and 2.5 percent in rural area) and 1 percent o f the consumers use 56 percent o f the available electricity.

To date, R U M has very limited human resources and i s not yet fully functional. This weakens RURA’s ability to monitor and enforce license obligations o f operators (quality o f service, coverage) and i t s role in ensuring efficient outcomes under the Universal Access Fund (UAF). See Annex 17 for a full explanation o f the UAF.

Technical assistance was provided to the Rwandan telecommunications sector under the Competitiveness and 16

Enterprise Development Project (Cr.3499).

37

This component will assist government in promoting access to competitive and affordable telecommunications services in remote areas. To this end, the project will strengthen the capacity o f the regulatory agency for the telecommunications sector (RURA) and improve access in rural areas.

Specifically, the project will support:

0 Strengthening RURA as well as the policy and regulatory framework

The UAF i s an important mechanism for extending connectivity throughout the country. However, in order to be effective, it needs to be managed properly and i t s ru les need to be enforced. The project will therefore strengthen RURA’s technical capacity to effectively monitor and enforce operators’ obligations and tasks related to the UAF. It will also reinforce the policy and regulatory framework for the use o f modern technology and the implementation o f eGovernment applications. To this end, eRwanda will finance the fol lowing activities:

(i) Staffing and Training plan for RURA

eRwanda will fund TA to put in place a training plan to allow RURA to effectively use technologies to supervise universal access and enforce operators’ obligations to provide agreed coverage. eRwanda will finance additional technical assistance (TA) to strengthen the capacity o f RURA, including. the preparation and implementation o f a human resource development plan for RURA (identification o f staffing requirements and qualifications and training plans for existing staff). Specific training and study tours will be organized for RUM’S staff working on the rural program or for the UAF members. To the degree possible, RURA staff should be empowered to carry out the work themselves; however, additional mentoring support and advice from an international consultant might be necessary to assure quality and continuous progress against agreed milestones.

(ii) Design and implementation o f a database to map telecommunications networks in Rwanda

This sub-component will help (a) Design a map o f current and planned telecommunication infrastructures (including fiber optic, mobile networks, rural access, electricity grid) in the country, (b) Identify access connectivity gaps and the country’s needs in terms o f nationalhackhaul l i n k s (in km) in l ine with the national IT plan and regional infrastructure, and (c) Assess and rationalize the different national backbone initiatives (fiber optic, wireless, electricity grid) to address the backbone and access gap in Rwanda.

(iii) Piloting an Output Based Approach for Private Operators in Rural Areas

Due to the anticipated l o w financial returns in rural areas, an Output Based Approach (OBA) seems most appropriate to encourage private operators to provide access in the selected regions. Under an OBA, the Government subsidizes operators who deploy access infrastructure. In the first phase o f the project, the program will be piloted in 12 public access information points at district offices and at least 5 access points or kiosk outside o f district offices (such as in post office, markets, schools, etc.) in remote rural

38

areas. eRwanda will finance TA for RURA to successfully auction the licenses including organization o f road-shows, packaging o f the tender document, and advertisements.

0 Financing the improvement o f basic access infrastructure for select provincial and district offices in rural areas

This sub-component seeks to link up provincial and districts offices in selected rural areas to the telecommunications network. The UAF would be used to subsidize private operators to lay the ‘last mile’ to public access points. The project would provide seed capital17 needed for the UAF to launch this O B A mechanism. The least cost subsidies will be used for the operators to provide access in selected areas and encourage private participation in the sector. The capital subsidy will be paid according to the compliance with network roll-out and service obligations. The disbursement o f the World Bank resources will be conditional on the satisfactory and efficient management o f the UAF. RURA will be in charge o f monitoring and enforcing operators’ compliance with licensing agreements at the time o f the award.

Component three i s heavily dependant on strengthening and operating costs o f infrastructure (such as fiber optics or energy systems) and thus i s estimated at USD 0.82 million, o f which about hal f will be used for support to strengthen RURA.

Component 4 - Project management (USD 1.47 million)

The component will provide support for the management o f eRwanda and the implementation o f intended reforms. Support will focus primarily on MININFRA which will lead the implementation o f eGovernment reforms and on i t s implementing agency RITA. Embedded within the RITA structure will be dedicated staff for the implementation o f eRwanda. These staff wil l be responsible for (i) procurement and financial management under the project, including contracting o f a l l works and purchases, and the hiring o f consultants, (ii) project monitoring, reporting and evaluation, (iii) the contractual relationship with the World Bank, (iv) financial record keeping, the Designated Account and the disbursements, and (v) implementation o f eRwanda activities. Project funds will be provided for salaries and operating costs o f the unit for eighteen months; it i s expected that the staff will be mainstreamed into the Government’s salary structure at the end o f this period.

The project will also cover the setting up o f an adequate quality assurance mechanism to accompany the implementation o f the reforms, the organization o f workshops and other feedback mechanisms for users o f public services supported by the project, as well as the development o f a monitoring and evaluation system for the eGovernment reforms.

This component i s envisioned to cost approximately USD 1.4 million, o f which about USD 300,000 i s allocated for staff salaries, USD 150,000 for M&E and USD 200,000 for studies and other technical assistance to RITA. The balance i s allocated for audits, training and operating costs.

Contribution to rural installations. 17

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Box 1: Leveraging the District Office to deliver Public Information Services and Content

Background

The Government i s in the process o f a major administrative restructuring which wil l create thirty new territorial districts. Each district wi l l be manned by professionals and support staff, including district health, education, finance, agriculture, M&E, and other staff. These local government staff will likely be housed in one building, or in facilities within close proximity to one another and comprise a new local administrative body called District Office (DO) The DO staff will a l l need basic equipment and connectivity. Furthermore, the financial management system (SmartGov) wi l l be deployed to the district level, and the staff in these locations wi l l need consistent, real-time access to financial data, both to extract information as wel l as to input expenditures.

The eRwanda Project i s an opportunity to leverage technology investments in each sector and in the Ministry o f Local Government, to provide full technology access (including operations, support, and maintenance) to the new district offices (DO). Ultimate goal i s that DO staff would have fully connectivity, full access to their ministerial databases and be able to both produce reports and send information to parent ministries. Since the project wi l l provide the requisite infrastructure and support to the DOs, these locations can also serve as sites for the ‘public access’ component o f eRwanda. The project can maximize this investment by co-locating the ‘public access’ points with the new district office and equipping them to become District Information Services Centers or DISCS’~.

DISCs

DISCs are the proposed community access points into eGovernment services. In addition to access to the services themselves, the DISC can also be a mechanism for providing the information and communication gateway to enable universal G2C, C2G, computer and Internet services to local communities. eRwanda proposes a shared approach in setting up and operating a DISC that leverages the DOs according to the ‘public access’ concept identified by eRwanda.

Similar in concept to the Wor ld Bank Office and the Public Information Center (the PIC), a district could implement a shared local network which separates the private areas (the districts’ private network with a l l i t s back office functions, databases and intranet) f rom the public areas (where the community can have access to the services and content o f eRwanda as well as the internet as a whole). This technology architecture and operating approach enables several significant benefits.

Minimal initial investment in physical infrastructure

The DISCs could be run by community members, women, or youth groups, and would be provided with the space, requisite equipment and telecom connections, as an extension to the Government’s DO.

Shared operating, support and maintenance costs

Furthermore, the DO wil l init ially cover the electricity, internet connection and other ongoing costs o f the DISC facilities, network and computer infrastructure support and maintenance.

Nationwide DISC network and access to eRwanda content and services

Sharing the computer infrastructure further enables a seamless access to the nationwide DO network essentially interconnecting a l l DISCs into one infrastructure. This further enables to access applications and data that resides or can be efficiently accessed through an integrated nationwide DO and DISC network infrastructure. As such, it eliminates the additional cost measured in both money and quality o f service that would have been otherwise imposed by a third-party implementation.

Promote G2C interaction and better service

Co-locating the DOs and DISCs wil l further enable the c iv i l servants to deliver services and additional information to supplement the local DISC services and multiply the benefit to the community.

DISC i s used in this document synonymously with ‘public access point’ 18

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Annex 5: Project Costs RWANDA: eRwanda Project

Project Costs by Component (in USD million) 1. Strengthening government effectiveness and

2. Improving service delivery to citizens and the efficiency

World Bank Contribution (in USD ‘000) 3,800

3,516 private sector

3. Improving access to services through enhanced 825

NOTE: Government wil l contribute substantially to the eRwanda Project by funding the Project Manager, by providing office space in the I T Park; and by contributing sites for the public access kiosks.

4. Project Mgmt Unallocated

Total Project Cost

1,475 3 84

10,000

Civil Works are rehabilitation and extensions to buildings 2o Goods and equipment are ICT equipment and installations

Consultant services include studies, reports, surveys and development o f computer applications (software programs) as well as the interim salaries o f the eRwanda project team in RITA.

*’ Operating costs refer to telecom bills, energy bills and rent, etc and subsidies to kiosks.

21

41

Project Costs by Category (in USD million) 1. Civil Works” 2. Goods, Equipment, 2”

3. Consultant Services21 4. Training 5. Operating costs22 6. Contingency Total Project Cost*

World Bank Contribution (in USD ‘000) 650

3,300 4,430

370 866 3 84

10,000

Annex 6: Implementation Arrangements RWANDA: eRwanda Project

The eRwanda Project will be implemented by the Rwanda Information Technology Authority (RITA), which operates with financial autonomy by the Law establishing RITA. RITA i s the Government body under the Ministry o f Infrastructure (MININFRA) mandated to coordinate al l ICT projects. At present, RITA has only limited capacity to implement the ambitious eGovernment reforms o f the Government (RITA has presently about 25 staff). The Government, therefore, intends to substantially strengthen institutional capacity and operational efficiency o f RITA. As part o f these efforts RITA i s recruiting additional staff in key competence areas such as ICT and business reengineering. At the final stage it i s anticipated for RITA to comprise in total 50 staff before the end o f 2006. In addition, the ability o f RITA to manage and monitor implementation o f complex eGovernment reforms will be reinforced. To this end, RITA i s putting in place a comprehensive management information system to monitor and track implementation progress and to ensure adequate reporting. In addition, a financial management system will be set up in l i ne with international standards.

In order to formally outline the arrangements between the Government o f Rwanda and RITA, the two organizations will sign a Subsidiary Agreement (SA) regarding the provision o f proceeds o f the grant. Furthermore, the World Bank will sign a Project Agreement (PA) with RITA as the implementing body.

Working closely with RITA i s the autonomous Human Resource and Institutional Capacity Development Agency (HIDA) which i s the coordinating agency o f the PSCBP.

RITA staff are fully integrated into the Government structure. In the past, it has proven difficult to attract high quality staff with relevant skills in ICT, financial management, procurement and other areas for the public sector. As a consequence, Government has put in place special arrangements with salaries above the normal public sector salary levels for priority areas and for skills that are considered critical for the implementation o f the Government program. These salaries require approval by the relevant authorities. In the case o f RITA, it i s anticipated that a substantial number o f staff will fall under these special arrangements. In the interim period o f 18 months, the eRwanda Project will cover the salaries o f the team, with the exception o f the Project Manager, whose salary i s covered by the government.

A. Organization of RITA and eRwanda implementation

RITA i s currently undergoing a reorganization and the proposed organogram, with the addition o f the eRwanda staff, i s presented below:

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I -

As indicated in the organizational structure the day-to-day operations o f the project will be ensured by a dedicated (full-time) eRwanda Manager. The Manager i s supported by a team o f specialists that i s composed o f RITA staff. The team comprises full-time experts in some critical areas with other RITA staff providing temporary support for the implementation o f eRwanda. Within RITA, the full time experts will be seconded to the eRwanda implementation team; they include: the Chief Technology Officer, the Private Sector Development Specialist, the M&E Specialist, the Financial Management Specialist, the Procurement Officer and dedicated support staff. The composition o f the core team i s based on the agreement with the Government that the eRwanda implementation team should be primarily development focused, although it i s recognized that significant ICT ski l ls will also be required. Additional RITA staff will be drawn in on a case-by-case basis if their sk i l ls are required for the implementation o f the project. Additional assistance in change management, training and capacity building will be provided by HIDA.

In l ine with the operational guidelines o f the World Bank it i s envisaged that the project will finance incremental contracts o f project implementation staff who are employed as consultants during a transition period within which the GoR will integrate the salaries into the annual budget. The transitional funding would also allow the Government to work out an incentive scheme that i s able to attract qualified personnel into the public sector. It i s envisaged to fully integrate the costs o f project implementation into the Government’s budget for the year 2008.

B. Oversight and reporting arrangements

The eRwanda Manager i s responsible for the implementation o f the project. The Manager i s supported by the core team which includes the Procurement Officer and the Financial Management Specialist who directly report to the Manager. The Manager i s accountable to the Executive Director o f RITA.

Oversight over eRwanda will be provided at three different levels:

Technical oversight will be provided by the RITA Management Team comprising al l Directors o f Units. The Management Team i s chaired by the Executive Director o f RITA. Its main function i s to provide quality assurance and to discuss implementation progress. The team meets on a bi-weekly basis. The discussions o f the team are based on progress reports prepared by the eRwanda Manager. Additional technical oversight will be provided by the RITA Board o f Directors. The main function o f the Board i s to monitor and facilitate implementation o f the RITA annual work program. The Board comprises representatives from the Government, the private sector and civil society; its composition i s outlined in the regulatory framework for RITA23. The Board i s chaired by the Rector o f the Kigali Institute o f Science and Technology (KIST). RITA regulations foresee up to

. twelve meetings o f the Board o f Directors per year. For the implementation o f eRwanda it i s anticipated to co-opt, to the Board meeting, other stakeholders including representatives from the Ministry o f Finance and from sector ministries targeted under eRwanda, as well as representatives from HIDA, MIFOTRA, and the Rwanda Utility Regulatory Agency (RURA). Technical discussions will be based on a monthly progress report prepared by the eRwanda implementation team.

23 According to the regulatory framework the Board o f Directors comprises: the Rector o f the Kigali Institute for Science and Technology (KIST), representatives from the private sector, from Telecom operators and from civil society, representatives from the Office o f the President, the Ministry o f Infrastructure, the Ministry o f Local Government and the Ministry o f Education.

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Political oversight will be ensured by the State Minister o f Charge o f Energy and Communications who reports to Cabinet about the implementation o f eGovernment reforms on a quarterly basis. The reports to Cabinet are based on quarterly status reports prepared by RITA and approved by the Board o f Directors.

Quality assurance will be ensured by a team o f international experts (Quality Assurance Group) that will be hired to provide conceptual and technical guidance for the implementation o f eGovernment reforms. This team will consist o f practitioners from other countries that have implemented similar reforms. This group will review the implementation status o f eRwanda every six months; i t will make recommendations to facilitate the implementation o f the reforms. The report o f the group will be discussed at the technical and political levels.

hersight and reporting arrangements are summarized below:

Quarterly reports

,

I Telecommunications

1 Quarterly reports

Quarterly reports

Quality assurance: RITA Management Team and Quality Assurance Group

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Annex 7: Financial Management and Disbursement Arrangements RWANDA: eRWANDA PROJECT

FY07

Financial Summary

FYOS FY09 FYlO F Y l l TOTAL

Investment Costs Recurrent Costs

(percent o f Total)

Note: Figures in total may not add up due to rounding

A. Introduction and Executive Summary

An assessment o f the financial management arrangements for the project was carried out with the aim o f determining whether they are suitable for the project and to determine whether the CGPT and the RMF have acceptable financial management arrangements. This annex contains the results o f this assessment.

1. Country Issues The recently concluded Country Financial Accountability Assessment documents the evaluation o f the Public Financial Management (PFM) environment in Rwanda. I t reveals that despite continuing weaknesses in the P F M system, the GoR has made tremendous strides towards improving accountability. The preparation o f the Organic Budget L a w (OBL), the adoption o f accompanying Financial Instructions and continuing efforts to adapt GoRs institutional arrangements are some o f the tokens o f GoR resolve to strengthen P F M in the country. The Office o f the Auditor General prepared i t s 2003 report and submitted it to Parliament, and there i s evidence o f Government action to address issues identified in previous reports. The budget preparation process has been strengthened with the introduction o f the Medium Term Expenditure Framework (MTEF). The process i s much more structured, with increased levels o f stakeholder participation, particularly o f c iv i l society and development partners.

However, continuing weaknesses in the financial accounting and auditing systems pose a major fiduciary risk. The biggest challenge facing the Government i s the severe human resource capacity constraint. The ability to attract and retain technically trained and qualified financial management personnel i s central to the sustainability o f P F M reforms. There s t i l l exists a strong disconnect between national strategic planning, the MTEF and resource allocation through annual budgets. The enormous strides made with the introduction o f the MTEF are mitigated by the lack o f sufficiently elaborated plans in many sectors. GoR i s also not yet able to meet i t s constitutional obligation o f preparing a consolidated set o f financial statements for submission to the Office o f the Auditor General, and subsequently, to Parliament.

GoR has adopted a number o f measures to address the shortcomings indicated above. These mainly center on the creation o f suitable capacity to implement the provisions o f the new legal

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and regulatory framework, ensuring the availability o f sufficient guidance to PFM personnel, and commencing the regular preparation o f financial statements. GoR has taken measures to enhance the procedures for budget preparation (strengthening the alignment o f budgets with strategies) and the control over it s treasury resources. The GoR carried out a needs assessment that identified the financial management sk i l l s required in government, including for accountants and internal auditors. The Government has embarked on a recruitment exercise to fill the vacancies in this area. GoR has also recently launched the process o f clearing the backlog accounts in l ine ministries, local governments and other public institutions. This move will help the Government prepare consolidated accounts starting with 2006. These will be submitted to the Auditor General. The roles o f the audit institutions have been clarified to remove previously existing redundancies. It has adopted International Public Sector Accounting Standards for accounting and financial reporting.

2. Summary project description

The project aims to promote the use o f technology as an enabler to the achievement o f development goals. The key objective o f the project i s to improve the efficiency and effectiveness o f government operations in key sectors through the use o f technology.

The project components are as follows:

0 Component 1 (USD 3.800 million) - Strengthening o f government effectiveness: support for an IFMIS and the establishment o f a Government portal

Component 2 (USD 3.516 million) - Service delivery improvements for citizens and the private sector, targeting business licensing, and citizen’s l i f e cycle events

Component 3 (USD 0.825 million) - Improving Physical Access to Services through enhanced Infrastructure in Energy and Telecommunications.

Component 4 (USD 1.475 million) - Project management

0

0

e

NOTE: The sum o f 384,000 i s unallocated, yielding a total o f USD 10 million.

3. Risk Assessment and Mitigation

The objectives o f the project’s financial management system are to: (i) ensure that funds are used only for their intended purposes in an efficient and economical way while implementing agreed activities; (ii) enable the preparation o f accurate and timely financial reports; (iii) to ensure that funds are properly managed and f low smoothly, adequately, regularly and predictably to implementing agencies; (iv) enable project management to monitor the efficient implementation o f the project; and to (v) safeguard the project’s assets and resources.

Furthermore, in order to ensure a strong financial management system, RITA should have an adequate number and mix o f skilled and experienced staff, the internal control system should ensure the conduct o f an orderly and efficient payment and procurement process, and proper recording and safeguarding o f assets and resources. The accounting system should support the project’s requests for funding and meet i t s reporting obligations to fund providers including the GoR, the World Bank, other donors, and local communities. The system should also be capable o f providing financial data to measure performance when linked to the outputs o f the project. Lastly, an independent, qualified auditor should be appointed to review the project’s financial statements and internal controls.

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Risk Rating Summary

Risk Rating

Risk Mitigating Measures

INHERENT R I S K S GoR i s highly committed to a reform program

Countrv Level Budget classification Periodic budget reports Preparation of public accounts Audit reports and follow up o f findings Priority accorded to improving PFM

M M M H L

that includes the strengthening o f the budget classifications, full ro l l out o f a new IFMIS in 2006, preparation o f first set o f consolidated accounts. New legal framework has already been adopted and GOR continues to strengthen

’ its accounting and internal audit capacity. Audit reports are prepared annually by the Auditor

I General and follow up i s satisfactory. , I RITA i s established through a legal and

Entitv Level Legal and institutional Monitoring and enforcement Accounting, financial reporting

M M M S

institutional framework that supports i t s oversight and implementation o f the project. The ministry recently appointed internal auditor. I t i s installing a new information system that should enable the preparation o f timely

Proiect Level Complexity o f project Architecture o f spending units

Relative number o f transactions Experience with WB Projects

Overall Inherent Risk

CONTROL RISKS

I accounts. I The project i s composed o f components that are

M M M S

al l financed by the same donor using similar modalities. Al l payments will be made by RITA. Its transactions are relatively low volume and direct payments will be possible for the biggest component. However, RITA has no experience in implementing World Bank projects. In mitigation, it will work closely with the Bank financed PSCBP in developing the financial management arrangements.

M

Budgeting Definition o f Budgeting process

M M

RITA’s Financial Management Manual will be revised to reflect the FM arrangements applicable to the project, including budgeting,

I _ _ Budgetary control and monitoring

M

I Budget revisions I I

budgetary control and the requirements for budgeting revisions

Accounting Documentation o f policies and procedures

Clarity o f accounting standards

Staffing o f accounting function

Clarity o f chart o f accounts

48

M M

L

M

H

RITA’s chart o f accounts will be revised top reflect the project transactions. RITA’s accounts are prepared using international accounting standards, and its accounting procedures and policies will be documented in the FMM.

Timeliness o f financial reports

Form and content o f the reports T T n donors.

Review o f management reports M

management reviews financial information and follows up. However, it will be important to prepare a format o f reporting that i s suitable for RITA, Government, the World Bank and other

Auditing Adequacy o f auditors

Acceptability o f auditing standards

Acceptable terms o f reference

M

M

The project’s institutional arrangements allow

auditors. International auditing standards are followed in the industry. RITA’S audit reports are generally timely, and management letters contain issues that assist management to ensure the continuing adequacy o f the financial

- for the appointment o f adequate external

I Quality o f management letters I I Timeliness o f audit reports

Overall Control Risk M M

49

OVERALL RISK RATING M

Weaknesses and action plan: However, some actions are yet to be undertaken to strengthen these arrangements, including the: - revision o f the FMM; - revision o f the Chart o f Accounts; - preparation o f the formats o f financial reports; and - the preparation and agreement o f the audit Terms o f reference

4. Project management structure and staffing

The Rwanda Information Technology Authority (RITA) will be responsible for the overall coordination and implementation o f project activities. RITA i s an autonomous institution that was established under the responsibility o f the Ministry o f Infrastructure (MININFRA) with the mandate to coordinate al l I C T projects.

RITA’S accounting function i s headed by the Director o f Administration and Finance who i s a qualified accountant. The daily supervision o f the financial management activities under eRwanda will be carried out by eRwanda Financial Management Specialist, recruited from the central government in accordance with agreed terms o f reference. The Financial Management Specialist will work under the existing Directorate o f Finance and Administration (DAF). An accounting function will be put in place to oversee the activities. It will be the responsibility o f DAF to ensure that adequate financial management system has been established within RITA to implement the eRwanda Project. There will thus be dedicated staff resources for FM for the project, but these will be integrated within the RITA structure.

An internal audit function i s established in RITA that will also ensure strong supervision and quality assurance at various stages o f the project.

5. Oversight and reporting arrangements

The eRwanda Manager i s responsible for the implementation o f the project. The Manager i s supported by the core team which includes the Procurement Officer and the Financial Management Specialist who directly report to the Manager. The Manager i s accountable to the Executive Director o f RITA.

Oversight over eRwanda will be provided at three different levels:

0 Technical oversight will be provided by the RITA Management Team comprising all Heads o f Departments. The Management Team i s chaired by the Executive Director o f RITA. I t s main function i s to provide quality assurance and to discuss implementation progress. The team meets on a bi-weekly basis. The discussions o f the team are based on progress reports prepared by the eRwanda Manager. Additional technical oversight will be provided by the RITA Board o f Directors. The main function o f the Board i s to monitor and facilitate implementation o f the RITA annual work program. The Board comprises representatives from the Government, the private sector and c iv i l society; i t s composition i s outlined in the regulatory framework for RITA24. The Board i s chaired by the Director o f the Kigal i Institute o f Science and Technology (KIST). RITA regulations foresee up to twelve meetings o f Board o f Directors per year. For the implementation o f eRwanda it i s anticipated to invite to the Board meeting other stakeholders including

According to the regulatory framework the Board o f Directors comprises: the Director o f the K iga l i Institute for 24

Science and Technology (KIST), representatives f rom the private sector, from Telecom operators and f rom c iv i l society, representatives f rom the Off ice o f the President, the Ministry o f Infrastructure, the Ministry o f Local Government and the Min is t ry o f Education.

50

representatives from the Ministry o f Finance and from sector ministries targeted under eRwanda, as well as representatives from HIDA and the Rwanda Utility Regulatory Agency (RUM). Technical discussions will be based on a monthly progress report prepared by the eRwanda implementation team.

Political oversight will be ensured by the Minister o f Infrastructure who reports to Cabinet about the implementation o f e-Government reforms on a quarterly basis. The reports to Cabinet are based on quarterly status reports prepared by RITA and approved by the Board o f Directors.

Quality assurance will be ensured by a team o f international experts (Quality Assurance Group) that will be hired to provide conceptual and technical guidance for the implementation of eGovernment reforms. This team will consist of practitioners from other countries that have implemented similar reforms. This group will review the implementation status o f eRwanda every six months; it will make recommendations to facilitate the implementation o f the reforms. The report o f the group will be discussed at the technical and political levels.

0

0

Oversight and reporting arrangements are summarized below:

Quarterly reports

Quarterly reports

Quarterly reports

Quality assurance: RITA Management Team and Quality Assurance Group

6. Planning, Budgeting, and Budgetary control

A project budget and a disbursement schedule will be drawn up and included in the project Appraisal Document and the Program Operations Manual (POM) from which annual budgets will be developed.

51

The annual budget will be prepared based on the policy guidelines issued by Ministry o f Finance. Annual budget estimates will reflect financial requirements o f the project. The Executive Director o f R I T A will be responsible for supervising the preparation o f an annual budget, reflecting financial plans for project activities. The annual estimates will be presented to the RITA Board by the Director for approval three months prior to the beginning o f the respective financial year (January-December).

The budget will serve as a planning, management and control tool. It will be regularly monitored, and material variances between budgeted and actual amounts will be investigated. The results o f the monitoring process will be fed back into the budgeting process to ensure proper fol low up o f key issues identified.

AccountinP System Internal Controls: The project’s internal controls will include al l the means by which RITA will ensure that i t s operations are carried out efficiently and effectively. In addition, this system will be used to ensure that project transactions are correctly made, recorded and reported upon. The accounting systems will be used to track, record, analyze and summarize financial transactions relating to the components for which they are responsible.

The project’s accounts will be prepared on a cash basis in accordance with International Accounting Standards. RITA will maintain an accounting system that allows for the proper recording o f project financial transactions, including the allocation o f expenditures in accordance with the respective components, disbursement categories, and sources o f funds. Appropriate controls over the preparation and approval o f transactions should be put in place to ensure that all. Proper books and accounts will be kept at al l levels o f the project on double entry principle using a cash-based system.

Financial Management Manual: RITA has a Financial Management Manual in place. I t will be revised to reflect the procedures for accounting for project transactions. The project’s accounting policies will specify the guidelines for the project’s financial transactions and will constitute basic principles designed to ensure that the accounting records are complete and reliable and that international accounting practices are followed consistently. Specific procedures will be documented for each accounting function, delineating document and transaction flows, the appropriate filing o f project documents, management approvals, and organizational duties and responsibilities.

Recording o f Transactions: Project accounts will be prepared on a cash basis in accordance with International Accounting Standards (IAS).

Controls over the preparation and approval o f transactions should be put in place at al l levels o f the project to ensure that al l transactions are correctly made, recorded, and reported.

RITA’s Chart o f Accounts will be revised to include codes that will permit the recording o f project specific transactions. Such a l i s t o f codes will be a useful tool in ensuring that RITA’s general financial reports include information that i s relevant to identify project specific transactions. It will also allow project costs to be directly related to specific activities and outputs o f the project.

Books o f Accounts: A computerized accounting system will be put in place. The P M U should ensure that proper books o f accounts are kept. This will be achieved through a well defined filing system that allows authorized users easy access to accounting and supporting documents on a permanent basis.

52

Integrated Financial Management Information System: RITA has installed an information technology systems platform which it will use to monitor and track implementation o f i t s activities and to ensure adequate reporting. This system i s based o n an open source Canadian software package, SQL ledger. A team i s currently working on i t s adaptation to the requirements o f the project. A financial management module will thus be designed to cover the budgeting, accounting and reporting functions o f the system. This will be developed in close consultation with the PSCBP financial management specialist. Accounting staff will be adequately trained to maintain the system and appropriate controls will be instituted to safeguard the confidentiality, integrity, and availability o f the data. The accounting system will be able to automatically generate financial monitoring reports.

7. Reporting Arrangements

Financial Monitoring Reports (FMRs): These will be produced on a quarterly basis. These will include: (i) a statement o f sources and application o f funds by project categories and components; (ii) output monitoring reports; and (iii) procurement monitoring reports. The reports will closely fol low sample formats that are provided in the World Bank Guidelines for Borrowers on FMRs. They will enable the comparison between project expenditures and the physical progress o f the project.

Financial Statements: RITA’s financial reporting system will be used to the extent possible. It will thus prepare a single set o f institution-wide financial statements in compliance with IAS and World Bank requirements. Transactions specific to eRwanda will be included in the overall financial transactions o f RITA. These transactions will be indicated in an attached schedule which will contain sufficient information on the sources and uses o f funds associated with eRwanda. The financial statements will also indicate the significant accounting policies and standards adopted by management and underlying the preparation o f financial statements.

The format, content, reporting periodicity and deadlines for submission o f reports will be prepared before and agreed at negotiations.

8. Audit Arrangements

Internal Audit: RITA’s organizational structure provides for an internal auditor who reports directly to the Executive Director, and i s thus assured o f a degree o f independence. Staff within this department will be competent and well-trained, and will have a clear understanding o f their roles and responsibilities. The role o f the Internal Auditor will be to review, appraise and report to the Management the soundness and adequacy o f the project’s internal controls.

The Internal Auditor will be responsible for planning and performing internal audits relating to project activities. The frequency and extent o f internal audits will be consistent with the nature, complexity, and risk associated with the project’s activities. The internal audits will be designed to ensure that internal controls remain adequate to provide assurance that project funds are spent in accordance with agreed objectives and relevant laws and regulations. In addition, they will entail the evaluation o f the effectiveness o f RITA’s risk management, control and governance processes. They will assist management by providing independent and objective analyses o f activities and controls and appropriate recommendations where deficiencies are identifies as a result o f those analyses.

Internal audit reports will address internal control strengths and deficiencies, and how effectively policies or procedures are implemented. RITA will put in place measures to address any issues identified and implement any recommendations made during the course o f the internal audits.

53

Management will be responsible for ensuring proper follow-up to the issues identified in these reports, and that the Internal Audit procedures continue to be adequate to fulfill its role.

External Audit: RITA i s required to prepare a set o f annual financial statements. This set, which will reflect the transactions o f RITA, including those o f eRwanda, will be subjected to a single audit.

The Office o f the Auditor General has the mandate to audit al l state revenues and expenditure, and the audit o f eRwanda thus falls within this mandate. However, institutions including RITA are allowed to contract auditors to whom this responsibility i s delegated. The auditor will thus be selected on the basis o f TORS, qualifications and experience acceptable to the World Bank and will be expected to be independent.

RITA’S financial statements will be audited on an annual basis. A copy o f the audit report will be submitted to the Bank within 6 months after the end of the financial year (1 January to 31 December). Terms o f Reference for the audit will be prepared by RITA and agreed with donors, including the World Bank.

In addition to the audit report, the auditor will be required to prepare a Management Letter, which will highlight internal control weaknesses and recommendations for improvements. A single audit opinion will be issued on project income and expenditures, Designated Accounts and FMRs. The audit reports, along with Management Letters, will be sent to the World Bank and al l other financing partners no later than four months after the end o f each preceding period.

9. Supervision

Financial Management Supervision will be done by the project World Bank Financial Management Specialist over the project’s l i f e to ensure the implementation o f strong financial management systems. Statement o f Expenditure (SOE) reviews will be undertaken, when necessary, in compliance with World Bank requirements. The Project Status Report (PRS) will include a financial management rating.

10. Disbursement Arrangements Banking Arrangements: RITA will open a Designated Account in the Central Bank o f Rwanda (Banque Nationale du Rwanda - BNR). World Bank project funds destined for the project will be deposited on this will be deposited on this U S dollar-denominated account.

Disbursement o f World Bank Funds to the eRwanda project: After satisfactory financial management arrangements have been established for the project, the disbursement o f World Bank funds to RITA for project activities will be made on the basis o f Financial Monitoring Reports (FMRs) that integrate financial reporting, procurement, and contract management with physical implementation progress. Under this system (report based), an advance will be made into the Designated Account at the inception o f the project. The advance will cover project expenditures for six (6) months as indicated in the initial six-month cash flow forecast. After every subsequent quarter, the project will submit FMRs that include a cash-flow forecast for the following six-months. The cash request at the reporting date will be the amount required for the forecast period, as shown in the approved FMRs, less the balance in the Designated Account at the end o f the quarter. Subsequent disbursements o f World Bank BANK funds will be made based on this request.

It i s expected that the report based disbursement method.wil1 be adopted six months after project effectiveness. Before then, the World Bank grant will be disbursed using traditional (transaction) methods. An advance will be made into the Designated Account at the effectiveness date o f the

54

project. This advance will be estimated to cover four months o f expenditures. Subsequent replenishments will be made on the basis o f withdrawal applications and Statement of Expenditures (SOEs). During this period, FMRs that are required under FMR-based disbursements will be prepared by the PMU and submitted to World Bank for review. They will be used to access progress towards meeting the requirements o f FMR-based disbursement methods. At the time o f conversion, the FM unit will prepare a reconciliation o f project expenditures, disbursements received, and Designated Account transactions up to the proposed date o f conversion. Other details for the conversion will be worked out closer to the time o f conversion between the project team and World Bank.

The option o f disbursing funds through direct payments from World Bank on contracts above a pre-determined threshold also will be available. Withdrawal applications for such payments will be accompanied by relevant supporting documents, such as copies o f the contract, contractor invoices, and appropriate certifications.

Allocation of Grant Proceeds

Expenditure Category

Civil Works

Goods, Equipment & Vehicles Consultants Services & Audits * Training

Operating Cost

PPF Refunding

Unallocated

Amount in USD million

0.650

3.300

4.430

.370

.866

0.000

.3 84

Total 10.000 1

Financing Percentage

100%

100%

100%

100%

100%

includes salaries o f the consultants, the portal, applications and information development.

The diagram below illustrates the funds flow arrangements for the project:

55

4 I Direct payments I *

11. Financial Management Action Plan

The financial management assessment identifies a moderate risk for the project. In order to mitigate the identified r isks and to ensure a smooth implementation o f eRwanda, the following actions are envisaged:

Issue

Financial Management Manual

Financial Accounting system

Remedial Actions Required

The RITA FMM will be revised to include procedures for accounting for project funds; this will form part o f the Project Operations Manual

The installation o f the information system, including the accounting component, will be completed.

Due Date

Before effectiveness

Before effectiveness

Recommended actions before effectiveness also include:

a) Reporting Arrangements: Formats o f financial statements, including FMRs, should be determined and agreed with the World Bank.

b) Audit o f project financial statements: Terms o f Reference for the audit o f the financial statements o f the project updated and agreed with the World Bank, indicating the scope and coverage o f the audit.

12. Conclusion o f the Assessment

The current financial management arrangements, subject to the improvements foreseen after the implementation o f the Financial Management Action Plan, enable the project to meet the minimum requirements for financial management as defined in O P B P 10:02. The Action plan contains areas that require strengthening, as identified by the assessment. This plan will be agreed between the World Bank, GoR and RITA during negotiations.

56

Annex 8: Procurement Arrangements RWANDA: eRwanda Project

A. General

1. Procurement Environment A Country Procurement Issues Paper (CPIP) was completed in June 2004; recommendations were incorporated in an action plan for procurement reform, discussed with and adopted by the Government. Despite the fact that Rwanda has followed pragmatic procurement practices under the National Tender Board (NTB, created in 1997), the legal, regulatory and institutional framework need to be modernized to bring its procurement system to international standards as developed by OECD-DAC with the participation and agreement o f the Government o f Rwanda. As part o f the action plan, the Procurement Code i s currently in the Lower House o f Parliament and i s expected to be adopted shortly. The various institutions created by the Code will have to be established and audit and appeals mechanisms to be implemented for better control o f the procurement system. Regulations, namely standard bidding documents, guides and manuals will have to be developed, adopted and disseminated. These measures are included in the PRSC triggers approved by the Board and by the Government. Their implementation i s underway and i s subject to high risk.

2. Guidelines Procurement for the proposed project would be carried out in accordance with the World Bank's "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004; and "Guidelines: Selection and Employment o f Consultants by World Bank Borrowers" dated May 2004, and the provisions stipulated in the Legal Agreement. The various items under different expenditure categories are described in general below. For each contract to be financed by the Grant, the different procurement methods or consultant selection methods, the need for pre- qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrower and the Bank in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

Procurement o f Works: Works procured under this project would include: Some small works w i l l be required to equip the Ministries and Distr ict Offices wi th secure computer rooms and telecommunications access. The procurement will be done using the Bank's Standard Bidding Documents (SBD) for al l ICB and National SBD agreed with or satisfactory to the Bank.

Procurement o f Goods: Goods procured under this project would include: equipment intended for: (a) upgrading o f LAN equipment in ministries and districts and remote community offices; (b) equipping the eGov portal system, post office payment system and various information kiosks in the country; and (c) providing office automation equipment to beneficiaries. A small number o f motor vehicles will also be procured. Also included are goods and equipment such as computers, office furniture, and equipment. Procurement will be done using the Bank's SBD for al l ICB and National SBD agreed with or satisfactory to the Bank.

Procurement o f non-consulting services: I n this categov, some transportation services may be procured, as well as some telecommunications. The procurement will be done using the Bank's Standard Bidding Documents (SBD) for al l ICB and National SBD agreed with or satisfactory to the Bank.

57

Selection o f Consultants : Consultants services from firms and individual cover: (a) pi lot applications for connecting two hospitals to Telemedicine system; (b) mobile applications (like health, education, agriculture, crime system and Environment); (c) policies and processes development for the implementation o f RURA’s mandate and restoration o f policy dialogue between private sector and authorities; (d) development o f back office systems (security, data dictionary, interoperability o f data); and (e) development o f training module to build capacity for technical support under the project. Shortlists o f consultants for services estimated to cost less than USD100,OOO equivalent per contract may be composed entirely o f national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines. It i s envisaged to engage universities, government research institutions, public training institutions, NGOs, and other special organizations.

Operating Costs: Operating costs include: fue l and vehicle maintenance for project vehicles, stationery, communication expenses, and subsistence allowances for authorized travel. They wi l l be procured using RITA administrative procedures which were reviewed and found acceptable by the Bank.

Other: The project will also fund the cost o f workshops, study tours and various consultations with stakeholders regarding the project. Salaries o f the eRwanda Project staff (except the Project Manager) will be funded for an interim period. The training, workshops, conference attendance and study tours will be carried out on the basis o f approved annual programs that will identify the general framework o f training and similar activities for the year, including the nature o f training/study tours/workshops, the number o f participants, and cost estimates.

B. Assessment o f the agency’s capacity to implement procurement

Procurement will be conducted by RITA. An assessment o f the capacity o f RITA to implement procurement activities has been carried out by the World Bank during the appraisal mission. At the time the procurement capacity assessment was conducted, RITA didn’t have the adequate level o f human resources to carry-out procurement activities. The recruitment o f one procurement officer i s now on-going.

The capacity assessment focused on the organizational chart, the technical ability and expertise in procurement as well as on the functional interactions with Ministries and other public institutions. Many issues and areas o f concern have been identified:

RITA does not possess for the moment the overall capacity to conduct good quality procurement. Developing the right procurement environment i s a major challenge RITA has to undertake in the very short term. The procurement group i s within the RITA Finance and Administration Unit and has no solid expertise in procurement, expertise that i s required to implement the project. Lessons from experience indicate that the procurement function must be given an adequate level o f autonomy as to avoid external influence on the procurement process. It should report to the highest level o f management as to avoid interference in the process. Another lesson o f experience i s that there must be the right level o f people with the right level o f skills, expertise and experience to obtain good quality procurement. The procurement group must be given an adequate number o f qualified people (or people who can quickly reach an acceptable level of expertise). RITA does not yet have the tools to manage properly the procurement process. Procurement Procedure manual i s to be finalized, standard bidding documents and evaluation report also need to be developed and finalized. Once finalized, project documents will cover procurement activities from procurement planning to contract management. A training program will be developed.

58

0 Another challenge RITA faces i s to establish priorities. Recently the Government entrusted RITA with the task o f procuring al l ICT related equipment and supplies needed by the Government and public institutions. It i s fair to say that in the current circumstances, RITA i s not in a position to accomplish successfully that mission.

0 Another difficultly that needs to be addressed i s the new overall procurement environment in Rwanda. A new code i s being debated in Parliament. Once promulgated, Ministries and public entities will have to adapt their structure to the legal requirement. Most likely this will require extensive training.

As a result, the overall procurement risk rating for eRwanda i s high.

Activities designed to mitigate this risk are outlined below:

Agency

RITA

RITA

RITA

RITA

Risk Factor

Lack o f an approved Procurement Manual Lack o f adequate staffing for procurement function

Placement o f the procurement function within the RITA Administration and Finance Unit

RITA’S priorities are numerous and complex.

Action to mitigate risk

Manual has been drafted and will be edited and finalized Recruitment i s underway for Procurement Specialist and Procurement Coach

It i s suggested that the procurement group be given an adequate level o f autonomy and be on the same level as the RITA Administration and Finance Unit, reporting directly to the Executive Director o f RITA. Recruitment o f an expert to assist RITA to prioritize actions and deliver on projects in implementation.

Deadline for Completing Action Before Effectiveness Before Effectiveness (for Specialist); Suggested to take place during project implementation (for Coach) Suggested to take place during project implementation

Suggested to take place during project implementation

C. Procurement Plan

The Borrower, at appraisal, developed a Procurement Plan for project implementation which provides the basis for procurement methods. The Procurement Plan for the first 18 months o f the eRwanda Project has been finalized. The Procurement Plan will be updated in agreement with the project team annually or as required to reflect the actual project implementation needs and improvements in institutional capacity.

59

D. Frequency o f Procurement Supervision In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment o f RITA has recommended that supervision missions visit the field once every six months to carry post review o f procurement actions.

Goods and Works and Non-Consulting Services Prior Review Thresholds: Procurement Decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Guidelines for Procurement:

Procurement Method

ICB (Goods)

LIB(Goods)

NCB (Goods)

International Shopping (Goods)

National Shopping (goods, works and non- consulting services)

ICB (Works)

Ceiling

Equivalent o f USD 250,000 and above per contract

N / A

Less than USD 250,000 equivalent per contract

Less than USD 25,000 equivalent per contract

Less than USD 25,000 equivalent per contract in accordance with National Tender Board Procedures and thresholds (see comments) Equivalent o f USD 500,000 and above per contract

Prior Review Threshold

Equivalent o f USD 150,000 and above per contract Equivalent o f USD 150,000 and above per contract

(i) Equivalent o f USD 150,000 and above per contract (ii) The first three contracts for Goods procured on the basis o f NCB. The first three contracts for Goods procured on the basis o f Shopping The first three contracts for Goods procured on the basis o f Shopping

Equivalent o f USD 200,0OOs and above per contract

Comments

Appropriate method where (i) There i s only a limited number o f suppliers (ii)Others exceptional reasons may justify departure from full ICB procedures. Purchasing Agency shall seek bids from a l i s t o f potential suppliers broad enough to assure competitive prices, such l i s t to include all suppliers when there are only a limited number.

Related to the nature o f Goods

For National Shopping (pro-forma invoices from at least 3 different suppliers/ contractors) RITA and beneficiaries project i s subjected to National procedures

60

Procurement Ceiling

500,000 equivalent per contract

Selection Method Ceiling

Prior Review

Prior Review Threshold (in

USD) 100,000

Threshold (i) Equivalent o f

Comments

Consultants w i l l be selected on quality and cost ( Q C W basis

USD200,OOO and above per contract

Quality and Cost Based Selection (Firms)-short l i s t shall comprise o f firms with a wide geographic spread

(ii) The first three contracts for works procured on the basis o f N C B (i) Equivalent o f USD 150,000 and above per contract

Equivalent o f USD 100,000 and above per contract

(ii) The first three contracts for Goods procured on the basis o f N C B (i) Equivalent o f USD 150,000 and above per contract

Quality and Cost Based Selection (Firms)-short l i s t may comprise entirely o f national consultants

(ii) The first three contracts for Goods procured on the basis o f United Nations Agencies

Less than USD 100,000 equivalent per contract

Comments

Selection o f Consultants

Prior Review Threshold: Selection decisions subject to Prior Review by the Bank as stated in Appendix 1 to the Guidelines Selection and Employment o f Consultants.

Prior Review o f TOR

Yes

Yes

61

3.

4.

5.

6.

7.

8.

Short list comprising entirely of national consultants: Short l i s t o f consultants for services, estimated to cost less than USD 100,000 equivalent per contract, may comprise entirely o f national consultants in accordance with the provisions o f paragraph 2.7 o f the Consultant Guidelines.

E. Details of the Procurement Arrangements Involving International Competition

1. Goods, Works, and Non Consulting Services

(a) List o f contract packages to be procured following ICB and direct contracting:

Selection Method Ceiling Prior Review of Prior Review Comments TOR Threshold (in

USD) Quality Based selection Equivalent o f USD Yes 100,000

Least-cost Selection (for N o ceiling Yes 100,000 financial and technical indicated audit services) Consultant Qualifications Less than USD Yes 100,000

200,000 and above per contract

100,000 equivalent per contract

Single Source (Firms) or N o ceiling Yes ALL Individual Consultant Single Source ( local N o Ceiling Yes ALL NGO’s and other organisations) Individual Consultants Less than USD Yes 50,000

50,000 equivalent per contract

1

Ref. No.

6

Cl IG1 L 1

ClIG1 L 2

C2lG3 L 1

7 8

Contract (Descriptio

4

Domestic Preferen

ce (yedno)

Yes L A N equipment for Ministries (upgrade)

Review Expected by Bank Bid- (Prior / Opening Post) Date

Prior 28-Feb-07

LAN equipment for 5 Regions,l2 District offices, and 5 remote communities (upgrade)

Equipments to DISCS with kiosks - Photocopier

3

Estimate d

cost

750,000

6 0 0,O 0 0

1,500,000

7 Method

ICB

Prior 28-Feb-07 Yes

9

Commen ts

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(b) ICB contracts estimated to cost above 150,000 for goods and 200,000 for works per contract and all direct contracting will be subject to prior review by the Bank.

2. Consulting Services

(a) List o f consulting assignments with short-list o f international f i rms.

1

Ref. No.

ClIS3

c2 /s 10

C2/S9

C1/S7

2

Description o f

Assignment

Back office systems (security, data dictionary, interoperability o f data) at NCC

Creation, publishing and dissemination o f information on agriculture, health, justice

Mobile applications (like health, agriculture, and crime system)

eGovt portal

3

Estimate d

cost

400,000

500,000

750,000

400.000

4

Selection Method

QCBS

QCBS

QCBS

ICB

5

Review by Bank (Prior 1

Post)

Prior

Prior

Prior

Prior

6

Expected Proposals Submissio

n Date

1 5-NOV-07

3 l/Mar/07

1 5-NOV-06

15/0ct/06

7

Comments

(b) Consultancy services estimated to cost above 100,000 per contract and all single source selection o f consultants (f i rms) for assignments will be subject to prior review by the Bank.

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Annex 9: Economic and Financial Analysis RWANDA: eRwanda Project

In Rwanda there i s a large gap between the capital ci ty and the rest o f the country in access and penetration o f I C T services. This i s not surprising as only 6.4 percent o f the country i s considered urban. A major challenge preventing the spread o f I C T i s human resource capacity, including lack o f policy and technical capacity. Internet services in the form o f cyber cafes and public payphones or kiosks have had provided public greater access but the number o f users i s small. And the inability to regulate a fast growing telecom sector i s also an issue. In this context, the Government o f Rwanda i s seeking to increase i t s services much more broadly through a phased penetration o f I C T interventions, encouraging private sector participation, and targeting key sectors such as agriculture, health and education. Calculating the economic and financial derivates o f eGovernment i s difficult as there i s s t i l l no general model for doing so.

The economic and financial benefits o f eGovernment projects in general are inherently difficult to quantify not only in Rwanda but also in public sectors o f other countries. This i s because economic and financial costbenefit analysis o f eGovernment projects i s in an incipient stage o f development, with various approaches taken by different governments in both developed and developing countries. Methodological approaches include assessing monetizable economic efficiency gains, non-monetary gains, and such benefits to citizens as time and cost savings (e.g., transportation costs). Many social effects as well as benefits that accrue from public administration activities stem from increased coverage and penetration using digital communication over telephonic and optical networks penetration. The fiscal impact will result from the use o f public investment funds to implement I C T reforms and to develop appropriate infrastructure in rural and urban areas as a part o f a phased I C T development strategy.

Some factors that have been considered in such analyses include: GDP growth, employment growth, quality o f services, better cost-effectiveness, quality o f life, cooperation among public agencies, reduction o f administrative burden, efficiency and productivity, access to public information, broadband, interactive public services, better public procurement, public internet access points, and culture and tourism, among others.

Most attempts at measuring economic and financial returns focus on supply side indicator, such as number o f services available on line, number o f times site visited and e-readiness, i.e., presence or absence o f structural and institutional conditions for the development o f eGovernment; on the demand side, take-up and satisfaction with services.

Variables to consider in developing measures o f eGovernment rates o f return are l o w levels o f connectivity and high cost o f services, especially mobile. At end 2005, penetration per 100 inhabitants was highly constrained: 2.02 percent; 0.33 percent for fixed network and 1.68 percent for mobile. Moreover, shortages o f electricity and poor electricity infrastructure are important factors affecting productivity measures: only 6 percent has access to the grid (20 percent urban, 2.5 percent rural) and 1 percent . o f consumers use 56 percent o f available electricity. These factors will affect productivity improvement and timing.

Data for measuring effects o f eGovernment also i s a key constraint in Rwanda as well as in many other countries. Much o f the data will be generated during the project to form a baseline by which to begin to measure the economic effects. These data include number o f staff working in eGovernment versus total number o f staff, cost o f respective staff, cost savings on staff (fewer staff, higher efficiency implications), cost o f hardware and software, global investment needed to

64

deliver improved services and share o f eGovernment, time efficiency, time savings (e.g., average waiting times), integration o f services effect, and cost o f training and related consulting services over time.

Financial returns o f the eRwanda Project cannot be easily quantified either. One o f the important impacts o f the project would be to reduce the transaction costs for citizens to access basic government services. In addition, information needed to access services this mostly rural country would be made available using innovative approaches including strategically located kiosks in different geographic regions as well as incrementally developing eGovernment coverage across the country. This should increase the capacity o f local government as well as the efficiency o f services provided and reduce government procurement costs. The private sector can also be expected to benefit by the provision o f technical services to public and private sector beneficiaries. As cost i s a factor in developing private ITC, regulatory framework will be an important contributor to private financial rate o f return as the demand can be expected to increase for fixed telephone services and private telephone kiosks. The three-phase penetration o f I C T in the eRwanda Project to targeted urban and rural areas also can be expected to increase the access and efficiency o f government services as 'well as attract private investment in ICT. This phased expansion o f the network would then provide some qualitative and quantitative basis for gauging the economic and financial rates o f return.

65

Annex 10: Safeguard Policy Issues RWANDA: eRwanda Project

The Environmental category assessed for this project i s C. There are no major environmental issues associated with the eRwanda, which i s a public sector reform project which relies heavily on I C T and applications to improve government efficiency and effectiveness.

As part o f i t s N I C I plan, the Government has already financed the development o f a Government Network (GovNet) which l i n k s key Min i s t r i es and provides them with high speed communications and office automation software. The eRwanda Project will extend this backbone to District Offices, but will not lay additional fiber optics cables, which will be lain by the telecommunications incumbent.

Safeguard policies

Safeguard Policies Triggered by the Project Yes N o Environmental Assessment (OP/BP/GP 4.0 1) E l [XI Natural Habitats (OP/BP 4.04) [I [XI Pest Management (OP 4.09) [I [XI Cultural Property (OPN 11.03, being revised as OP 4.1 1) [XI Involuntary Resettlement (OP/BP 4.12) [I [XI Indigenous Peoples (OD 4.20, being revised as OP 4.10) [XI Forests (OP/BP 4.36) 11 [XI Safety o f Dams (OP/BP 4.37) [ I [XI Projects in Disputed Areas (OP/BP/GP 7.60)* [ I [XI Projects on International Waterways (OP/BP/GP 7.50) [ I [XI

[I

[ I

In te rms o f the social impact, it i s anticipated that the eRwanda Project will have a positive effect, particularly for citizens and businesses in the rural areas. A social assessment study will be performed within the first six months o f the project. The aim o f this assessment will be to use participatory methods to analyze the context and social issues which relate to the project, so as to provide input to the project design, implementation and M&E framework.

A proper data collection methodology will be prepared prior to the assessment. The social assessment will examine the socio-cultural context, the institutional context, the historical context, and the political context in which the project i s functioning. Legislation pertinent to the project will be reviewed and the following social issues will be examined: social diversity and gender, institutions with their rules and behavior, stakeholders with an interest in the project, participation o f stakeholders, and social risks. The study will also identify the likely social development outcomes o f the project and propose a social development strategy to achieve them. Finally, the assessment will feed into the M&E mechanism for the project.

The required clearances have al l been obtained.

* By supporting the proposedproject, the Bank does not intend to prejudice the jna l determination of the parties' claims on the

disputed areas

66

Annex 11: Project Preparation and Supervision RWANDA: eRwanda Project

Initial PID to PIC Initial I S D S to PIC Appraisal Negotiations BoardRVP approval Planned date o f effectiv

Planned Actual PCN review November 21,2005 November 2 1 , 2005

November 29,2005 November 29,2005 November 29,2005 November 29,2005

June 20,2006 June 20,2006 July 20,2006 July 20,2006

August 29,2006 December 3 1 , 2006 December 3 1 , 2008 December 3 1,201 0

ss Planned date o f mid-term review Planned closing date

n

Key institutions responsible for preparation o f the project: RITA (Rwanda Information Technology Authority), Ministry o f Infrastructure, HIDA

Bank staff and consultants who worked on the project included:

Name Title Unit Guenter Heidenhof Task Team Leader Arleen Cannata Seed Stefanie Teggemann Jerome Bezzina Sudhakar Kaveeshwar Malcolm Cosgrove-Davies Knut Leipold Pierre Morin Chantal Kajangwe Sameena Dost Joseph Kizito Renee M. Desclaux Wolfgang M. T. Chadab Artavazd Ghazaryan Soheyla Mahmoudi Andrew Osei Asibey Marie-Jeanne Uwanyanvaya Mavo Ranaivoarivelo Berthe Ndayambaje Reynaldo Castro Warren Waters

Co-Task Team Leader Public Sector 'Specialist Regulatory Economist

Manager Sr. Energy Specialist

Sr Procurement Specialist Sr. Procurement Specialist

Procurement Analyst Sr Counsel

Sr Financial Management Specialist Finance Officer Finance Officer

Consultant Operations Analyst

Sr. Monitoring and Evaluation Specialist, Program Assistant

Language Program Assistant Team Assistant

Consultant Regional Environmental and Safeguards

AFTPR ISGEA AFTPR CITPO ISGEA AFTEG OPCPR AFTPC AFTPC LEGAF AFTFM LOAG2 LOAG2 ISGEA AFTRL AFTRL

AFMRW AFTPR

AFMRW AFTPR AFTSD

Advisor

67

Annex 12: Documents in the Project Fi le RWANDA: eRwanda Project

0 Operational Manual for the Multi Sector Capacity Building Programme, Draft, Price WaterhouseCoopers, March 2004 Mapping o f on-going and planned capacity building activities o f all Government Ministries, Departments and Agencies (MDAs) and Local Governments, Final Report, March 2004.

0 The Vision and Strategic Framework for the Multi Sector Capacity Building Programme in Rwanda, May 2003.

0 Medium Term Strategy, Action Plan and Budget for Multi Sector Capcity Building Programme, Draft Report, June 2003.

0 Multi Sector Capacity Building Programme: Retrat held in Gisenyi, Final Report, June 2002.

0 Multi Sector Capacity Building Program: Workshop to define the way forward, Final Report, May 2002. Summary o f the Main Report-Multisector Capacity Building Programme; Assessment o f Capacity Building Activities, May 2002. Inception Report - Multisectoral Capacity Building Program, January 2002. Valentine, Theodore R. Towards the Development o f a Medium Term Remuneration Policy for the Rwanda Public Service: Draft Report, January 2004. Public Sector Reconfiguration and Transformation. Strategic Paper - Republic o f Rwanda. Kigali, December 23,2003.

0 Rwanda Financial Accountability Review and Action Plan. Final Report o f Diagnostic Mission, February 2003.

0 Obidegwu, Chukwuma: Rwanda: The Search for Post-Conflict Socio-Economic Change, 1995-2001, Africa Region Working Paper Series, No. 59, October 2003. Appraisal o f the Decentralization in Rwanda, Final Report - Republic o f Rwanda. Ministry o f Local Government, Information and Social Affairs, September 2003. Harvard Business Review, “On Point: Why Good Projects Fail Anyway,” September 2003. Constitution o f the Republic o f Rwanda, June 2003. Memorandum o f the President on a Country Assistance Strategy for the Republic o f Rwanda, November 2002. Poverty Reduction Strategy Paper and Joint IDA-IMF Assessment for the Republic o f Rwanda, July 2002. National Investment Strategy (NIS) - Republic o f Rwanda. Ministry o f Finance and Economic Planning, CEPEX, May 2002. Rwanda National Information and Communication Infrastructure (NICI) Plan Minister Butare’s Document on the importance o f ICT for Rwanda

0

0

0

68

Annex 13: Statement o f Loans and Credits RWANDA: eRwanda Project

Project FY Purpose ID

Difference between expected and actual

disbursements Original Amount in USD Millions

IBRD IDA SF GEF Cancel. Undisb. Orig. F m . Rev’d

PO60005 2006

PO90194 2005

PO66386 2005

PO74102 2004

PO71374 2003

PO75129 2002

PO57295 2001

PO64965 2001

PO65788 2001

PO45182 2000

PO45091 2000

RW-Urb Infrastr & City Mgmt APL 0.00 0.00 0.00 0.00 0.00 19.89 1.06 0.00

RW-Urgent Electricity Rehab S I L 0.00 25.00 0.00 0.00 0.00 22.13 -0.30 0.00

RW-Pub Sec CB TAL (FY05) 0.00 20.00 0.00 0.00 0.00 18.38 1.21 0.00

(FY06)

(FY05)

RW-Decentr & Community Dev Prj 0.00 0.00 0.00 0.00 0.00 18.06 3.57 -0.08 (FY04) RW-MultiSec HIV/AIDS (FY03) 0.00 0.00 0.00 0.00 0.00 13.76 -4.05 0.00 RW-Emerg Demobiliz & Reintegr 0.00 25.00 0.00 0.00 0.00 16.62 5.98 -1.36 (FY02)

RW-Compet & Enterprise Dev (FYOl) 0.00 40.80 0.00 0.00 0.00 13.64 4.18 0.00

RW-Regional Trade Fac. Proj. - 0.00 7.50 0.00 0.00 0.00 5.95 5.52 0.00

RW-Rur Water Sply & Sani SIL 0.00 20.00 0.00 0.00 0.00 9.74 3.85 0.00

RW-Rural Sec Supt APL (FYOl) 0.00 48.00 0.00 0.00 0.00 30.41 25.09 -5.63

Rwanda

(FYOO) RW-Human Res Dev (FYOO) 0.00 35.00 0.00 0.00 0.00 14.14 11.92 12.57

Total: 0.00 221.30 0.00 0.00 0.00 182.72 58.03 5.50

69

Ttttal Cost of Praiect: I.'S1>55 million.

Annex 15: NICI Activities RWANDA: eRwanda Project

A. The NICI I Plan

1. Objectives of the NICI I Plan The f i rst phase o f the NIC I I Plan yielded the Rwandan ICT-Led Socio-economic Development Policy, and the first o f the four rolling ICT4D25 Plans designed to serve as the cornerstone o f the Government’s socio-economic development program over the five year period from 2001 to 2005. The NICI-2005 Plan was based on eight pillars, namely:

Human Resource Development The Deployment and the Exploitation o f ICTs in Education Electronic Government and Governance The Development and Promotion o f the Private Sector Deployment and Spread o f ICTs in the Community ICT Infrastructure Development Legal Regulatory, Institutional Provisions and the Promotion o f Standards Foreign Direct Investment Drive in ICTs

The implementation o f the various components o f the Plan has been carried out by the various Government Ministries, Public Sector Organizations (PSOs), the Universities and Colleges as well as the private sector.

The Rwandan ICT4D process was designed to strategically focus on both the development of the local industry targeted at the export market as well as on using ICT as an enabler of RwandaS broad developmental goals.. The dual focus o f ICT4D process i s driven by need to use ICTs as a broad enabler o f i t s socio-economic development process as well as putting in place policies and programs to develop i t s ICT sector and industry.

The details o f the Government’s policy commitments as contained in the ICT4D policy document were based on the need to achieve the aspirations o f the Vision 2020 aimed at developing Rwanda into a middle income country by 2020. The ICT-lead socio-economic development Vision, aimed at achieving the aspirations o f the Vision 2020 i s to: improve the quality of life of the people of Rwanda by enriching their social, economic and cultural well- being through the modernization of the economy and society.

2. Accomplishments o f the NICI I Plan Rwanda made major strides during the f i rst N I C I Plan to use ICTs to facilitate its socio- economic development process. For example, at the start o f the N I C I I plan, in the educational sector, only one school in Rwanda had a computer; by 2006, computers have been distributed to a considerable number o f primary and secondary schools. Up to 39 secondary schools have internet access through the wireless broadband network. In relation to the training o f computer literate teachers, many teachers have been trained in computer literacy and basic computing.

The ICT infrastructure has also seen major improvements in Rwanda over the past three years. Fixed l ine telephony and mobile telephone network and services have now extended to all parts o f the country including the rural areas. A national fiber option backbone network i s under

25 Information and Communication Technologies for Development

76

construction with private sector involvement. Most o f the Government Ministries and Public Service Organizations (PSOs) now have corporate networks in place.

Several cyber cafes and telecenters can now be found in cities and towns throughout the country. The majority o f these were opened in the last three and a hal f years during the implementation o f the Plan. The spread o f ICTs within the community in the last 3 years was largely due to the enabling environment created by the policy and plan development and implementation process in terms o f infrastructure development, reduction in the price o f computer equipments and resources partly due to the removal o f taxes and import duties on computer products. Also the explosion o f cyber cafes in every town and city since the beginning o f the process can be attributed to the public awareness created by the process on the importance o f ICTs and the need for i t s use within the economy and society

Serious efforts have been put into raising public awareness on the importance o f the need to deploy I C T to facilitate Rwanda's development process. Rwanda i s now regarded internationally as a nation serious about the development, deployment and the use o f ICTs to facilitate development. Rwanda's ICT4D Policy and Plan now serves as a model for a number o f African and other developing countries. It i s now acknowledged both within and outside the country that ICTs i s high on Rwanda's development agenda.

3. Challenges to the NICI I Plan The review reports o f N I C I I Plan states that about 76 percent o f the N I C I I Planned actions were either not implemented at al l or are s t i l l in process.

Some o f the challenges that Rwanda faced during the implementation o f the first Plan were: difficulty in mobilizing resources to facilitate the implementation o f the programs and the initiatives o f the plan, a young and understaffed implementing authority (RITA), insufficiently skilled personnel to implement the projects, poor infrastructure (energy and telecommunication infrastructure) to support the activities, insufficient understanding o f the role o f I C T in development, insufficient attention paid to the needs o f the communities and rural areas, and poor coordination o f the N I C I I Plan by RITA.

4. Steps the Government has taken to address the shortcomings o f N ICI I Plan To provide the basis for the development o f the NICI-20 10 plan - the 2nd o f the four rol l ing plans envisaged under the ICT4D policy - the review o f the impact o f the implementation o f the f i rs t five years NICI-2005 plan in terms o f i t s achievements and lessons was conducted between March and June 2005.

The current plan NIC4D-2010 Plan i s perceived as a continuation o f NICI-2005 not separate from it. In other words NICI-2010 Plan i s a rol l- over plan and such i t i s not distinct from NICI- 2005 except that some additional (new) planned actions have been added to the roll-over planned actions from NICI-2005 plan to constitute the totality o f the programs and corresponding planned actions o f NICI-20 10 plan.

The Government has put in place resources mobilization strategies for the implementation o f the planned actions under N I C I 2006-20 10. Also, the Government has strengthened the coordination mechanism o f the N I C I 2006-2010 by establishing N I C I I1 Program Unit within RITA to coordinate the implementation o f N I C I I1 Plan.

For the next five years o f the implementation o f N I C I I1 plan, the Government has decided to avail 2 percent o f the annual ordinary budget to support the implementation o f N I C I I1 plan.

77

The Government i s putting in place mechanisms to utilize prudently funds from the World Bank through eRwanda Project to accelerate and support the implementation o f the some o f the key N IC I I1 Planned actions on fast track.

B. The N I C I I1 Plan The Rwanda ICT4D process i s now in i t s second phase, which i s focusing on the development and implementation o f the second N IC I plan - the NICI-2010 plan. This plan i s scheduled for implementation from 2006 to 2010. The goal o f the NICI-2010 plan i s to build on the achievements o f the NICI-2005 plan with emphasis on supporting and strengthening Rwanda’s economic base and improving the economic environment to accelerate development and growth towards achieving predominantly information and knowledge-based economy.

The N IC I I1 plan i s structure in terms o f sub-plans with each sub-plan representing a pillar o f the NICI-20 10 plan consisting o f 10 pillars:

Pillar 1 : ICT in Education Pillar 2: Human Capacity Development Pillar 3: Infrastructure, Equipment and Content Pillar 4: Economic Development Pillar 5: Social Development Pillar 6: eGovernment and e-Governance Pillar 7 : Private Sector Development Pillar 8: Rural and Community Access Pillar 9 : Legal, Regulatory and Institutional Provisions and Standards Pillar 10: National Security, Law and Order

The components o f each o f the sub-plan take into account: (i) the achievements and lessons learned in relation to the implementation o f the NICI-2005 Plan; (ii) the need to regard the NICI- 2010 Plan as one o f the four rolling plans envisaged for implementing the provisions o f the ICT4D Policy within the time-frame o f the Vision 2020; (iii) the guiding premise, principles and other specific requirements for developing the details o f the plan and (iv) the various stakeholder contributions and inputs generated during the consultative process on the plan.

The table below shows the relationship between the N I C I plan and the eRwanda activities:

78

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Annex 16: Links with other projects RWANDA: eRwanda Project

A. Bank Financed Projects

Sector Issue Bank-

fin an c e d Environ- ment

Health

Rural Sector

Active Projects

Integrated Management o f Critical Ecosystems Project

Multi- Sectoral HIVIAIDS Project

Rural Sector support Project

Project Objective

To promote the adoption o f an integrated ecosystem approach using improved farming technologies that improve farmers’ livelihood and increase productivity in a way that protects the resource base for biodiversity conversation outside protected areas, and for increased carbon sequestration. To: (i) strengthen prevention measures in order to slow down the spread o f HIV/AIDS; and (ii) expand support and care for those infected or affected b y HIVIAIDS.

To build capacities in the following areas: (i) management o f farmed marshland and hill-side areas; (ii) access to credit and management o f productivity and competitiveness in agricultural export sectors; (iii) generation and dissemination o f improved technologies; (iv) preparation and supervision o f small-scale rural infrastructure by local communities; (v) construction and maintenance o f post-harvest and water management infrastructure.

Anticipated Synergies (Bank financed only

Synergies

eRwanda w i l l provide a mobile phone based application that w i l l help collect and transmit weather and environmental data for an early warning system

eRwanda wil l : - connect two rural hospitals to the Telemedicine project (of the GoR) - disseminate general health information to citizens via DISCS and other means eRwanda wil l : - provide a mobile phone based application to help collect data on food security and crops and disseminate crop and livestock prices and trends

-help disseminate a service delivery directory for M INAGRI as well as information related to agriculture; inform farmers and rural entrepreneurs about credit lines available to them under the RSSP

Project Ends

1 Oil 512009

1 013 01200 8

0613012007

92

Sector Issue Bank-

financed Education

Energy & Mining

Private Sector Developme nt

Active Projects

Human Resources Development Project

Urgent Electricity Rehabilitation Project

Competitivene ss and Enterprise Development Project

Project 0 bj ec tive

To build up Rwanda's human resources and institutional capacity to deliver education services following the 1994 genocide, with attention to the poorest members and regions o f the country. Specific actions are geared to: (i) improve access to basic education by increasing its intake capacity through community participation in rehabilitating, constructing and equipping schools; (ii) improve the quality o f inputs (teaching, instructional materials, methods o f supervision)in primary and secondary education; (iii) heighten awareness and train students, parents and educators to combat the AIDS epidemic; (iv) build institutional capacity and improve efficiency in the management o f the education system through focused training, studies and policy development, and initiation o f a Sector-Wide Investment Program. To: (i) Alleviate power shortages; and (ii) enhance the capabilities o f energy sector institutions.

To establish an enabling environment for private sector-led economic growth and poverty reduction in Rwanda. The project will focus on promoting a competitive climate by (i) streamlining the business environment; (ii) reducing the costs and increasing the efficiency o f telecommunications, water and electricity utilities, and the tea industry; and (iii) improving access to financial services and provide support services to local entrepreneurs.

Anticipated Synergies (Bank financed onlj

Synergies

The DISCs would provide internet access to students which would provide an opportunity to access information nationally and internationally.

eRwanda will use results o f an ICT and telecommunications infrastructure mapping study (financed under the UERP) to determine where to place the DISCs

The UERP's support to improving the electricity supply will facilitate the establishment o f DISCs. eRwanda will assess local ICT private sector capacity and propose ideas for strengthening it.

The CEDP works to strengthen the local private sector through a variety o f means such as an annual business plan competition, support to the Private Sector Federation, regulatory reforms etc. al l o f which are expected to also benefit the local ICT private sector vital for the increased demand eRwanda will generate. eRwanda will provide 1-2 consultants to work specifically to strengthen new IT companies.

Project Ends

1011 512009

0713 112009

0713 112007

93

Sector Issue Bank-

financed Public Sector

Decentraliz ation

Active Projects

Public Sector Capacity Bui lding Project

Decentralizatio n and Community Development Project

Project Objective

Public sector entities have the Zapacity for more efficient, sffective, transparent and accountable performance in their redefined roles and functions and for achievement o f their strategic objectives contributing to the implementation o f the PRSP.

To: (i) strengthen District capacity to lead a process o f planning and consultation with local communities, translating their development priorities into sub- projects which are incorporated into Districts’ strategic development plans; (ii) develop a matching grants system to finance the sub-projects; (iii) validate procedures for decentralized project cycle management and financial management, through implementing the sub-projects, to replicate as basic operating procedure in Rwanda’s overall decentralization program; and (iv) introduce and promote public awareness programs.

Anticipated Synergies (Bank financed onlj

Synergies

The PSCBP financed project preparation for eRwanda mostly through fast-tracking its ICT component which was designed to build basic I C T capacity in the public sector.

Financing for SmartGov will come f rom the PSCBP, but it will be physically distributed to the district offices through the infrastructure funded by eRwanda.; the two projects will collaborate on the development and dissemination o f publ ic information in health, agriculture and other sectors.

Another strong area o f collaboration i s in the creation and dissemination o f Citizen’s Guides to ministerial services. eRwanda wil l provide district offices with technology and capacity building support to enable them to:

- provide (i) information on Government services (service delivery directories and feedback mechanisms) and (ii) general information in specific priori ty sectors;

- link up to the central SmartGov system and receive and feed information into the SmartGov system and the national monitoring and evaluation system once established.

It is expected that the DISCs would help establish the district offices as service points frequently used by citizens.

DISCs wil l provide citizens with a voice mechanism through a variety o f feedback channels (collection boxes, internet based feedback forms etc.) on Government services and adherence to published standards

Project Ends

12/31/2009

09/30/2009

94

B. Linkages PSCBP and eRwanda

PSCBP

- Finance consultant to evaluate on a regular basis: first evaluation one year after role out

ICT Infrastructure

eRwanda team will provide advice

Government websites

I Software

Internal communications to keep public servants informed on implementation progress o f SmartGov Data integrity

Data warehouse

system

Security t----- Consistency o f public management regulations

ards and ministerial ICT

evels in central

- Equip district offices

- PSCBP eRwanda team will provide

- PSCBP eRwanda team will provide

-

advice

advice PSCBP will cover a consultancy to extract financial information and insert it into the comprehensive M&E system for the country.

PSCBP eRwanda team will provide

Information Development

Dissemination Strategy o f ministry services and sector-related public information

Feedback mechanisms (pull-outs in guides; electronic feedback mechanisms etc.)

PSCBP

- Phase I - Develop concept paper and formats for Citizen’s guides and traidinform ministries Phase 2 - Support development of the Citizen’s guides through national

-

consultants working with ministries. eRwanda and PSCBP IEC officers - develop a strategy jointly for dissemination of information products

- PSCBP covers traditional dissemination costs (printing, media and periodic updates) Survey on public perception (“Is Government more responsive, accountable, transparent, effective?”)

Include pull-outs in service delivery directories

alternative institution) to receive and treat complaints

-

- Paper forms for feedback -

- Strengthen Ombudsman Office (or

eRwanda ES - Other information and content

development for ministries

- eRwanda and PSCBP IEC officers develop a strategy jointly

dissemination costs - eRwanda covers electronic

- feedback button in kiosks - suggestion boxes in kiosks

96

C. Funding from other Development Partners

Sector Issues ?ublic financial nanagement and nonitoring and evaluation

[CT

Private sector development, including public private partnerships Legal and judicial system

Decentralization and community development

Donor Agencies EU, DfID, UNDP, SIDA

UNDP, SIDA, USAID, Swiss Embassy, DfID

DfID, EU, SIDA, USAID, Africa Capacity Building Foundation (ACBF)

UNDP, GTZ, Canada, Netherlands

UNDP, Netherlands, SIDA, USAID

Synergies and Comments The EU and DfID support public financial management reform, including SmartGov, through a multi donor trust fund which i s co-financing PFM under the PSCBP. SIDA, the Swiss Embassy and UNDP have been supporting RITA

USAID finances the last mile initiative to connect coffee cooperatives with each other; it also financed connectivity and other ICT activities for the school and PEARL projects (Cafe de Maraba).

UNDP financed a feasibility study on telekiosks, it will also finance (from NICI Solutions) the document tracking and workflow management in selected ministries, the citizen’s guide to Governmental procedures, the citizen’s guide to parliamentary operations, the donor coordination network, the strategic ICT plans for Ministries not covered by eRwanda, establish free public information access points not covered by eRwanda, and develop a legal framework for ICT.

EU has provided substantial support to office automation and a document management systems for Parliament

DfID has contributed to the Education Management Information System (eMIS) at MINEDUC, contributed to the development of eLearning materials and computerized the Rwanda Revenue Authority USAID supports local private sector development, in particular in the ICT sector.

USAID has contributed USDl million to the Ministry o f Justice network system in 2003 Belgian Cooperation funds an information center in agriculture, which will host a DISC financed under eRwanda UNIFEM provides support to telecenters

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Annex 17: Possible Projects for a Phase I1 if supplementary funding i s secured

RWANDA: eRwanda Project

This Annex i s intended to outline the scope o f the additional activities which eRwanda envisions accomplishing in case supplementary funding becomes available during the project implementation.

A) Ensure sustainability o f completed activities B) Provide infrastructure to more Ministries and District Offices C) Develop more kiosks (models to be used based on LL from preceding installations) D) Implement more internal government and citizen-focused applications as follows:

National Library Network: To establish a shared online catalog for the major libraries in Rwanda; access could also be established through the Government Portal. Immunization Tracking System: To track the immunizations records and by using new technologies, like S M S on mobile phones, a vaccine notification system can warn family members on their next vaccine date. Health Clinic Tracking System: To support the MINESANTE’S ability to track the service delivery o f i t s other health clinics. Citizen’s registry/database: To provide a Government database with vital evidence o f citizen’s records Automate the Criminal Justice Information System (CRIJIS) also called Justice Information System: CRIJIS i s to serve as a comprehensive computer-based information and database system on al l aspects relating to the administration, operations and the activities o f the Criminal Justice and Legal System o f Rwanda Implement Educational Management Information Systems (eMIS): To provide the central and decentralized levels with adequate data and user-friendly computerized tool which would facilitate planning, reporting and monitoring across the sector. In addition, this solution i s to build capacity at central and decentralized levels in Information Technology and in use for policy decision-making, planning, monitoring and management purposes. Assist RIEPA: Build the Capability o f the Rwanda Investment and Export Promotion Agency (RIEPA) Agriculture Information System: To collect, process and analyze and disseminate more extensive agricultural data. Citizen’s L i f e Services: To develop the full range o f electronic services for citizens, such as birth, death, marriage certificates, licensing and registration, payment o f taxes and so on.

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Annex 18: Telecommunication Infrastructure and markets in Rwanda

RWANDA: eRwanda Project

Rwanda Government has undertaken a liberalization program for the sector by promulgating, in 2001, the law regulating telecommunications. In this context, within the Regulatory Agency, the Communications Commission strives to set up a regulatory framework l ikely to ensure the telecommunications sector development.

A. The National Telecommunications Market Trends

Telephone services on the national market in the course o f 2005 have been supplied by three operators: RWANDATEL, incumbent operator since 1993 in the field o f fixed telephony, MTN RWANDACELL supplying mobile telecommunication services since 1998 and, ARTEL ensuring satellite communication network (VSAT) in the rural areas since 2002.

1. TERRACOM- RwandaTel Privatization o f RwandaTel to the private company TERRACOM took place in late 2005. Terracom Communications i s laying fiber optics across the country and has installed wireless internet in many schools and communities.

TERRACOM Communications expects very fast progress in laying fiber optics across Rwanda. Theoretically, Terracom have already laid 256 km o f fiber: from Kigal i to Butare (140 km) and from Kora to Karisimbi (40km). In and around Kigal i City, another 20 km o f fiber i s being laid. Terracom i s planning capacity for 500,000 users on i t s mobile and fixed network by 2010.

2. MTN RwandaCell

The first mobile operator in Rwanda, MTN - RwandaCell, i s a joint venture between RwandaTel and MTN International, the latter owned by the MTN Holdings (part o f the M-Cel l Group from South Africa). MTN International has 40 percent o f the stocks o f MTN - RwandaCell. In Rwanda about 97 percent o f the subscribers are prepaid. Rwandatel’s participation in MTN - Rwandacell was transferred to the Government prior the privatization o f RwandaTel. This i s explicable because the privatization model o f RwandaTel includes a mobile operator license, so the new owner will be competing with MTN - RwandaCell in the near future.

MTN RWANDACELL i s planning capacity for 400,000 users by 20 10.

3. ARTEL International This company was launched in October 2002, introducing VSAT services in the rural areas with the aim o f connecting the villages to the world. ARTEL entered into a technological partnership with Gilat Satellite Networks from Israel (www.Gilat.com), and has already deployed more than 200 VSATs across Rwanda, with interconnections with RwandaTel and MTN - RwandaCell. International calls originated in the VSATs go through RwandaTel. Users buy prepaid cards in the local shops (e.g., groceries stores, community centers, etc.,) to make their calls.

ARTEL Communications boasts a network o f 275VSATs, 257 o f which are within Rwanda and 18 in other countries. O f the 275, 199 are solar-powered and 76 are on the national electricity grid. O f the 257 VSATs, 156 are in local government offices.

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The national telecommunications market has recorder noticeable progress, particularly in the mobile segment in 2004. This has occurred despite the energy crisis in the country and the freezing o f new investments as a consequence o f the RwandaTel privatization process.

New services have also been introduced in the market, Le., prepaid cards for fixed telephones and public mobile phone commonly known under the name of “TUVUGANE” (Let’s talk).

In November 2005, ARTEL Communications changed the company name to become ARTEL International.

B. Market Structure, Competition, and Projects

1. Market structure

The evolution o f the number o f subscribers shows as follows:

Table 3: Evolution o f the number o f subscribers (active lines) Source: RURA 2001 2002 2003 2004 2005

I RWANDATEL 21,458 25,105 25,565 22,972 23,9031 MTM RWANDACELL 44,117 82,391 97,261 145,904 219,657 ARTEL 0 60 304 452 490 TOTAL 65,575 107,556 123,130 169,328 244,050

End 2005, the penetration rate per 100 inhabitants was evaluated at: 2.9 percent. O f this, 0.3 percent i s for the fixed network and 2.9 percent i s for the mobile network.

2. Licensing and Competition

RwandaTel and MTN RwandaCell have obtained concessions on the basis o f law n08/92 and these concessions had to be converted in licenses according to the terms o f Article 71 o f the law organizing telecommunications.

Moreover, in i t s session o f June 25 2003, the Cabinet decided to attribute a cellular telecommunication license to RWANDATEL, a fixed telecommunication license to MTN RWANDACELL as well as a license to ARTEL for rural telephony.

3. Projects Through the latest available statistics, one may notice considerable growth in the telecommunications sector, as evidenced by the increase in the number o f projects and operators. Currently, two important projects may significantly affect the market structure and have dramatic impact in the telecommunications sector in Rwanda.

KAFUSIMBI Project - Rehabilitation o f the existing tower at Karisimbi to prepare i t for being used in efficient way by different stakeholders and operators.

ELECTROGAZ - Extension and electrification o f the communication system o f the national electricity transmission grid - Implementation o f an Optical Ground Wire (OPGW) on the entire 1 10 kV and 70 kV transmission path.

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C. Rwanda ICT Developments

Despite i t s recent history, Rwanda i s actively pursuing I C T development. The country has a National I C T Policy in place and has an institution, the Rwanda Information Technology Authority (RITA) that i s charged with implementing the policy. Already several elements o f the

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policy and plan have started moving. The f i rs t Internet Service Provider (ISP) was launched in 1997 in Rwanda by the National telecommunication operator, RwandaTel.

1. ISPs in Rwanda

The main current ISPs operating in Rwanda are the following:

RwandaTel (www.rwandatel.rw)

RwandaTel, the incumbent Telecom operator, was the only official commercial ISP in the country until end 2000. It currently provides dial up internet connection, wireless connection and soon will introduce ADSL connection.

National University o f Rwanda (NUR) (www.nur.ac.rw and the Kigal i Institute o f Science and Technology (KIST) (www.kist.ac.rw)

The National University o f Rwanda (NUR) and the Kigal i Institute o f Science, Technology and management (KIST) started the Internet service provision at the beginning o f year 2001. Both KIST and NUR started obtaining international bandwidth through the use o f VSAT dishes installed as part o f the USAID Leland initiative but since February 2004, KIST i s getting the Internet services from TERRACOM. KIST uses both Dial up and Wireless technology to provide Internet connectivity to i t s customers while NUR uses D ia l up and Fiber optic to serve i t s customers.

ARTEL communication (www.arte1communications.com)

ARTEL started in 2003 and get international bandwidth through the use o f VSAT dish and exclusively uses the VSAT to provide both Internet and telephone access in rural area.

TERRACOM (www.terracom.rw)

TERACOM started in February 2004, getting international bandwidth through the use o f VSAT. TERRACOM uses Wireless and fiber optic technologies to provide with Internet access to i t s customers.

2. End Users

Rwanda has a very low Internet penetration: 0.3 percent

Table 3: Evolution o f Internet subscribers Source: RURA 2001 2002 2003 2004 2005 IRWANDATEL 1,482 2,047 2,378 2,497 2,4841 MEDIAPOST 0 0 114 130 ARTEL 0 0 12 28 28 TERRACOM 0 0 0 220 TOTAL 1,482 2,047 2,504 2,875 2 3 1 2 * Mediapost does no more operate as an ISP in 2005 ** no data available for Terracom in 2005

*

**

The use o f the Internet for educational purposes i s currently limited to the NUR and KIST. Computers and the Internet are virtually non-existent in the school system and this situation i s likely to prevail as long as most schools have no electricity or telephones but the Government started to provide telephone and internet connectivity since 2004.

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The Rwandan Government believes that I C T offers the opportunity to leapfrog the key stages o f industrialization to transform her agriculture-dominated economy into the service-sector driven information and knowledge economy.

3. Creation of RINEX The high cost o f international bandwidth to the Internet has limited i t s growth in developing countries, while at the same time also limiting the quality o f services. This i s mostly due to the fact that ISPs in developing countries use international bandwidth for their national as well as international traffic, meaning that al l national traffic must pass out o f the country in order to reach an international node before returning to the country o f origin.

The ideal solution i s to have a local interconnection point where traffic originated from one local ISP within a country intended for another local ISP will not have to leave the area or country to reach i t s final destination. This interconnection point i s referred as Internet Exchange Point

The RINEX project established the Rwanda Internet Exchange point in Kigal i to connect al l the ISPs in Rwanda. RINEX allow peering -- passing o f traffic -- between ISPs without the need to send the data through international l i n k s . This keeps local traffic within Rwanda, which both enhances the quality o f Internet services and ensures bandwidth savings.

The RINEX'project was performed as part o f the Communication Systems Design 2004 course at the Royal Institute o f Technology (KTH) in Sweden and sponsored by the Swedish International Development and cooperation Agency (SIDA). The aims o f this project were designing and implementing an Internet Exchange point in Rwanda and creating a local capacity that would be able to utilize and manage this IXP.

The I X P in Rwanda has been successfully implemented: al l the six local ISPs that operate in Rwanda are connected and a full mesh has been implemented. A sustainability plan has been produced and the ISPs staff has been trained to manage the IXP.

(IXP).

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Annex 19: Rwanda Universal Access Fund

Legal Framework and Management

RWANDA: eRwanda Project

A. Introduction The rapid development o f information and communication technologies has shown that the use o f information can play a key role to develop economies. Like many other countries, the Government o f Rwanda i s committed to boost I C T sector, aiming at moving towards information based economy. To achieve this objective, it will require that access to information and knowledge be facilitated for al l citizens to ensure the full participation in the achievement o f the national socio-economic goals, particularly at the community level.

In this context, the regulator (Rwanda Ut i l i t ies Regulatory Agency, RURA) who has been entrusted with a mandate to ensure access to basic communications on affordable terms by the general public, has to address the following challenges:

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L o w coverage and penetration rate o f telecommunications services

Rural community access(wide gap between urban and rural areas)

The capability o f rural population to use new I C T applications

L o w purchasing power o f the population, as 64 percent o f the population is below the poverty threshold.

In this regard the Government o f Rwanda has established a Universal Access Fund (UAF) aiming at encouraging and supporting the deployment o f network infrastructure and services, especially in rural areas.

1. Legal Framework for the Universal Access Fund The law n044/200 1 governing telecommunications establishes a Universal access fund aiming at encouraging and supporting the deployment o f Public telecom facilities and services in Rwanda.

The presidential order no 05/01 determining the functioning o f the Universal Access Fund and Public Operator’s Contributions outlines clear indications and mechanisms o n the usage and UAF management as summarized below:

a. Definition and scope o f universal access The law governing telecommunications defines universal access to basic telecommunication services as the providing the widest possible access, on affordable terms, to a public telephone service by the general public. This must be available in al l parts o f the Republic. The Presidential order n005/0 1 specifies that universal access shall consist of:

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Providing in each large city at least one public access point at every 2 km radius

Providing in each district and trading centre, at least one public access point

Ensuring free carriage for calls to emergency public services

Facilitating access to information technologies, especially in schools, hospitals and other public services

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This definition refers to a situation where each individual person has affordable access to a public telephone. It could be ensured through community access points l i ke public phones or community public access points.

b. Source of funds

The fund i s financed, without excluding other sources, with contributions made by public operators. These contributions consist o f a percentage applied on the turnover o f the concerned operator, generated by the running o f telecommunications networks or services open to the public. The percentage i s annually determined by the Regulatory Board.

c. Fund administration and management

The Regulatory Board i s responsible for universal access fund administration. The fund’s bank accounts are separate from the RURA management bank accounts. The Chairman o f the Regulatory Board controls the expenses and revenues o f the fund and the agency’s accountant i s the accountant o f the fund. The fund resources support the costs incurred by the Board for identification and selection o f the public operators to undertake any new service provision as well as the financial resources necessary to allow the provision o f such services or development o f new projects.

d. Identification of communication needs The Regulatory Board i s the responsible for drawing up and keeping up to date the l i s t o f districts according to their access to telecommunications services. This l i s t shall be used as the basis for the planning o f the telecom service provision for the subsequent years.

e. Technical and economic assessment

The Regulatory Board i s responsible for carrying out comparative studies o f p i lot projects. Such studies are used to compare investment and operating costs o f new services provision taking into account emerging technological innovations.

f. Planning

O n basis o f identified communication needs, technical and comparative studies o f pilot projects carried out, the Regulatory Board annually defines where extension programs should be undertaken, taking into account the available resources and giving priorities to provision o f services requiring the lowest subsidies.

g. Awarding of tenders The contract for a universal access services provision i s awarded by a transparent process based on competition between interested public operators taking into account the public operator requesting the lowest subsidies.

It i s within the framework o f this law, that RURA has developed a f i rst p i lot project for the provision o f telecommunication services in 44 sites identified in rural areas across the country.

B. Universal Access Pilot Project

1. Introduction

In conformity with the provisions o f the Presidential Order on universal access, in i t s decision n001/2004, the Regulatory Board decided to set the contribution o f the operators to the UAF at 2 percent for the year 2003. The total contributions received into UAF for the year 2003 amounted to Rwf457,684,044.

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The project was launched following an offer o f services presented by ARTEL Communications for the connection to i t s network o f 44 sites identified in rural areas in collaboration with the local administrative authorities.

The Regulatory Board invited al l other public operators to submit their expressions o f interest but none o f them was interested in the project. As a result, the contract for the implementation o f the project was awarded to ARTEL Communications.

2. Project Implementation

a. Cost of the project: The total cost for the 44 sites amounted to Rwf 404,021, 473, representing: D ia l Away IP VSAT; Solar Energy Kit; Installation; Satellite Space and Administration

Each installation has a capacity o f 6 telephone l ines including one l ine dedicated for fax with two default telephone lines. Only the two default l ines are operational, the remaining four l ines may be made operational on payment o f USD 680 for each set o f two additional lines.

The connection to the Internet i s possible with payment o f Rwf 152 000 monthly fees.

The average number o f target people at each site i s estimated between 4 000 and 6000 persons. The neighbouring socio economic facilities are schools, health centers, churches and trade centers.

b. Tariffs applied: VSAT to VSAT Rwf 50 VSAT to Fixed Rwf 70 VSAT to Mobile Rwf 1 15

3. Lessons learned from the implementation of the project

Most o f the 44 sites identified were very far f rom the existing telecom networks and scattered across the country in al l provinces. As a result, this has limited possibilities o f competition. The next strategy needs to mix attractive with less attractive areas together to provide better possibilities for competition.

The project has been fully funded. In order to optimise the impact o f the UAF, the operators should be awarded subsidies after an estimation o f the cost to supply services as well as submission o f the project to a test o f viability.

An economic and technical study highlighting the state o f supply and demand on the telecommunication market should be conducted in order to establish a map showing telecommunication market services needs per area. The output o f this study will allow determination o f priority areas and subsidy requirements.

With regard to sustainability o f the project, it was found that the income generated by each site was very l o w (an average o f Rwf 11,00O/month per site) compared to around Rwf 10,000,000 cost o f one site. It i s clear that in such conditions this investment can not be commercially viable. I t i s imperative to conduct a demand study before undertaking such project.

Resources mobilised through the UAF are s t i l l very l o w compared to existing needs.

The deployment o f telecom network infrastructure i s not yet wide enough to cover al l regions including rural areas.

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In conformity with the provisions o f the presidential order o n the UAF, R U M undertakes to conduct a survey which will enable to l i s t districts and localities according to their access to telecommunication services and to determine priorities for future projects.

Operator 2003 MTN RWANDACELL 296,226,260 T E R RACO M -RWAN D l 161,457,783 Subtotal 457,684,043

2004 2005 343,549,389 332,405,732

O* to be paid in June 2006 343,549,389 332,405,732

* Following the proccess of Rwandatel privatization, Rwandatel has not contributed to the UAF for the year 2004 The privatization Secretariat will pay on behalf of Rwandatel a total amount of Rwf 164,277,533.

Butare 1 2 3 4

5. List of sites identified for implementation of the project

Busoro Nyamure Muyaga Gikonko Kabuye Maraba Maraba ’ Nyakizu

Byumba 1 2 3 4

Kigasha Ngarama Zoko Kisaro Nkana Rushaki Karehe Rebero

Cyangugu

4 5

Kagunga Gatare

1 2 3

Birembo Gatare Nkanka Impala

Gikongoro 1 2 3 4

Rwamiko Nyaruguru RWUfi Nyaruguru Kibaga Kaduha Nyamibata Nshiri

Gisenyi 1 2 3

Kiziguro Kageyo Kigeyo Kayove Busoro Nyamymba

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Gitarama 1 2 3 4

Rwesero Akabagali Gasovu Ndiza Mugina Ruyumba Shyanda Kayumbu

Site D i s t r i c t N amu ali Rusumo K a ashi Kanko b wa N arubu e

4 C imbazi Muhazi

Kigali Ngari 1 2 3 4

Rutsiro Itabire

Butembo

Mabare Bicumbi Nkanga Gashora Rweru 2 Gashora Rutonde 2 Ngenda

Ruhengeri 1 2 3

Rutovu Butaro Rwaza Bugarura Nyabitsinde Kinigi

Umutara 1 Nyamiyonga 2 Buhabwa 3 Rukomo Sector 4 Bwera

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Kabare Rukara Muvumba Bugaragara

Annex 20: Country at a Glance RWANDA: eRwanda Project

Development diamond' POVERTY and SOCIAL

2004 Population. m id-year (m //lions)

Rwanda

8 4 220

19 GNI per capita (Atlas method, US$) GNI (Atlas method, US$ billions)

Average annual growth, 1998-04

Population (Yd 2 4 Labor force (%J 3 0

Most recent est imate ( l a tes t year avai lable, 1998-04)

Poverty (% of population belo w nationalpo vertyline) 60 Urban population (%of totalpopulation) 20 Life expectancy at birth (pars) 40 Infant mortality(per looolive births) 118 Child malnutntion (%ofchildren under5) 24 Access to an improved water source (%ofpopulation) 73 Literacy (%ofpopulation age E+) 64 Gross primary enrollment (%of school-age population) P2

Male P2 Female 122

KEY ECONOMIC RATIOS and LONG-TERM TRENDS

1984 1994

GDP (US$ billions) 26 075 Gross capital formationlGDP 158 130 Eqorts of goods and sewicesiGDP P 6 6 3 Gross domestic savings1GDP 8 8 -485 Gross national savings1GDP 152 2 9

Current account balancelGDP -2 1 -70 Interest payments1GDP 0 2 0 2 Total debt1GDP ?a3 '1266 Total debt serviceiexports 7 4 7 7 Present valueof debtlGDP Present value of debtlexports

1984-94 1994-04 2003 (average annual gro Mh) GDP -27 9 1 10

Exports of goods and sewices -79 148 -26 GDP percapita -37 4 0 -18

I Sub-

Saharan Low- Af r i ca Income

7 8 600 432

22 10

37 46 131

58 65 95

132 88

2003

17 ?a4 8 3

-0 8 136

-7 8 0 4

915 ?46 57 7

667 2

2,338 513

184

18 2 1

31 58 79 44 75 61 94 131 88

2004

16 20 8 9 6 30 7 4

-3 5

2004 2004-08

3 7 4 2 3 5 2 9 4 6 5 4

Development diamond'

Life expectancy

GNI Gross

capita enrollment per m a r y

Access to improvedwatersource

-Rwanda Lo w-incomegroup

Life expectancy

GNI Gross

capita enrollment per m a r y

Access to improvedwatersource

-Rwanda Lo w-incomegroup

Economic rat ios '

Trade

Economic rat ios '

Trade

Domestic Cap it a I savings formation

Indebtedness

-Rwanda .-. Low-income group

Indebtedness

-Rwanda .-. Low-income group

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Annex 21: Letter o f Development Policy RWANDA: eRwanda Project

REPCBLIC OF RWAKDA

MINISTRY OF FXNAXYCE A\uD

P.O. Ror 158 Kigali Tcl: +250-577994 Pax: ! 2%-$77581 E-mail : tntin'il'rwandaI .coin

ECOKOMIC PLANNITS'C

Mi-. Paul Wolfuwitz President The World Bank 1818W. Street, 3.W. Washington D.C. USA

Dear Mr. Wolfowitz.

Re:

1. I ain writing to reqiwt. cin behalf o f the (iovenzmcnt ofthe Rcpublic o f ' l i h~nda (GoR). j t7u.r approval ofS10 mi l l ion equivalent from International 13ovclopment Association (RIA j in siippurt of the implementation o f the National Information and Communication lnlrastructurc (SIC1 2006-20 I 0) plan gh the realization o f cR.i\.anda project. I*he support rccjuested i s intended to fInsuce scri aimzd ar using Information an3 Cainniiinication Teclinologies ( l C l ) to increase cliiciency and effectiveness in the deliwr) o f Go\ c w e n t information and seP;icrs to citizens. In collaborauon with the privatc sector. the Goveriitnent'q r& I S intended to S L ~ ~ M t h i s effort by creating and maintaining the economic, physical aizd socia! infrastructures. and maintainiiig a stable and attractive jnvestment emirunnient conducive for thc proposed activities o f the eRwaiicia project.

2. I t i s Government's contention that knowledge o f ICT wi l l rrnpowr those without work and enable them TO realizc their full polzntiitl and rhus find gainiul cniploymcnt. ICT opens doni.; to a futuro o f eiidlcss opportunities. creativity and glohal interactib.ily. Therefore, t h e population ofRwanda must be equipped to mmtcr the baric IT shills that the ICT revolution requires. The focu. here i s most definitely on people: The Governnient of Rwinda IS making sure that everyone ha5 the opportunity to continue, stnn or restart on Ihe path to succc"ss. For the Government it is riot II mattcr o f a choice betwen the development o f ICT OY investmentc in the social sectors such as health and education, rather i t i s the xecagnitinii that the combination between ICY developnicnt cind invcstrnents in the social sectors wrl l potentially yield the greatest hen& In essence tecfioiogy w i l l enable the govcrnmcnt ro reach i t s goal., in the most efficient arid ei'fectivo m a i l s possible.

Letter of Reveiopment Policy on eKwands Project

Background and recent developments

3. ICT as a part of the development challenge became iriost evident in significant international meclings. In mid-2000, the eight major industrial nations (the G-8) acknowledged that ICT “is m e of the mast potent forces in shuping (he twen?y$rst century [and] ~ f s revolutrnnary impucf u@ts [he wuy pcoplc live, lcnrn and work, and [he wuy gn:ovemmen/ inferacts with rzvif socjefy.” The capacity o f these technologies to reduce many traditional obstacles, espccidly those of time and distance, for thc first time in history makes i t possible IO use the potential o f these technologics for thc bcnefit o f millions o f people in all corners ofthe world”. WSZS Declaration o f Principles, 2003

4. ‘I‘he CroK rccognizcs the role that lCTs can play in accelerating the socio-economic development of‘ Rwanda towards an information aiid knowledge based economy. The COR believes that Rwanda is well placed to takc advantage uf these technologies to facilitate her socio-economic devcloprrient process. 10 this cnd in 1998 the Goveniment embarkcd on an ICT for Developmsnt (KICI) process in line vAtli vision 2020; It was decided that ICT for Devclopment (1CTJ.D) in Rwanda would be implemented in four phascs, each phase coinciding with the development and the implommtation o f a 5 Year rolling K IC I Plans. This document was endorsed by Cabinet. in 2000, after consultations with several stakcholders including acadcrnia. civil society and the private sector. The goveri~ment lrm cmphasimd i ts intention to use investment in ICT as the key driver for t h i s transition and as a vehicle for improving the delivery ofpublic and private services, pdcutar ly in the rural areas.

5. NICI plan i s now in its second phase o f rollout. In th is phase 10 pillars rcsponding tu a11 sector o f our cconorny havc bwn pronounced. The NICI t l Pillars do not solcly addresses ICT requirements hut define national requirements and broad policies that Rwanda needs to acidrcss However, only the solutions to the Policies dl be ICT based, The IC3 pillars developed under the Nll l l 11 plan are* Human Capacity and ihltinnst I)cvc~opmcnt, IC?‘ in Education. Infrasvucture & Equipment and Content, nomic Development, Social Development, eCovernment and eGovernance, Privatc Sector Dcvelopment, Rural and Coininunity Access, Legal. ReguIatory and lnstitutiorial Provisions and Standards, and National Security 6? Law and Order

.

6 ’n te CioR acknowledges that if Rwanda i s to move her industrially weak, subyistence- agriculture based economy towards an information and knowledge economy it wil l trzccl to develop comprehensive integrated IC‘T-lcd socio-economic developtnent politics, strategies and plans. It will therefore not he enough for Rwanda tn implement x number of isolated TCT projects and programs or sectoral policies That rlre not ticd tu the country’s overall socio- economic development objectives, strategies and prugrtuns. I t i s against thiq hackground therefore, that, the GoR approached thc World Bank in June 2005 to furid a n eRwmda Project, ab a subset o f the NTC‘I II Plm. This Project focuses on t h e core activities ofthe KICI 11 Plan which will briny t h greatest positive result for Rwanda and the development o f the diovernrnent plat lorn and applications which have the grcarcst impact OJI the social fabric of society by addressing the service delivery and information needs ofthe ruir t l populations, and strengthening the underfying Legal and regulatory framework for development o f the Vision 2020.

7. In addition, the GoR recognisres that eRwanda project would be dn enabler for both e- governance as well DS social and huinanitarian activities such as literacy and edimncing the tackling system for WIV/.4IDS. With uidespread deployment o f such projects, citizens would

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find much lowcr transaction costs, and experience greater transparency in their interactions with government and business. A longcr-term vision i s ror not only doing things less expensively than today, but also differently as wcil. ICT based employnient can enhance p n t h rates, and bring many countries into the globai knowledge-based economy. ICI’ has a great role to play in human development, as discussed at the World Summit on the ltiformfttion Society (WSlS). Most o f the targexs established at WSlS related to infrastructure developmcnt and access to informatian by al l which th i s project addresses. There i s enonnous and latent demand for ICT in Africa, evidenced by people’s willingness to pay even the high costs of today (the average telccom uscr in Africa today pays -$350i per year). ?‘his project will also lead to cnorrnous employment opportunities, not only after deployntcnt but even during the implementation.

Tekcomnunicalion Infravlructiire

8. “‘l’oday w e all recognke that ICT i s not a matter o f choice; it i s a nccessity. It has bccoine abundantly clear ( ....). We plan to provide broadband connectivity to all secondary schools within three years, using optic fibcr and wireless technology. These will also serve a5 access point for the benefit o f the nual communities in the catchment areas, with thc ultimate aiin of probiding universal ilcccss.’ (H.E. Paul Kagarne, at the World Summit on the lrlforrnatiun Society Geneva, 2003).

9. The GoR i s currently in the proccss of harmonizing telecommunication iiiftastruciure tu allow open access nctwork. Favorable policy and regulatory fi-aniework has bum put in place and thcreforc the government owned power and water utilily operator (ELECTROGAZ): has plans tu use i t s inherent right-of-way to deploy up to 800 km of fiber over i ts power transmission network, The aim o f the fiber network i s to support i t s commuiiicsltions among its own s ta f f and provide a dark fibcr leasing service to support the iinplenicntation of‘NICI II 1

Pian. TerracortrlRwandaTel - A merger by a cellular network operator atid the former state-ofinurl public tclecommunications network operator. Already has LIP to 300 kin o f fibcr burkd in and between Kigali and Biitare and Possesses a broad service portfblio that includes niobilc lnturnct connections (CDMA2000 EV-nO), fixed Internet using digitel subscriber lincs, international lemed circuits via an earth station, voice (fixed and mobilc) and fiber connectivity using a CTbE network. hlTN/Rwandacell- Mobile (GSbQ voice service provider (subsidiivy of MTN South Africa) also ptovidirig mobile Internet connection servicc (GPRS) with the coverage OF 90%. MITI Rwndacell provides as well, internet connectivity by a fixed wireless access nertvork. Also operates various public phone services In both urban and rural areas {Tuvugane, Tel ’nibere). Artel - A satellite-based solar-pou.ered telecommunications service provider for rural communities.

.

A contract was signed between RITA, on bclialfoTthht: Government and TERRAGOM f‘or the provision of‘ bandwidth and related services to specific Government Institutions Currently 28 Miniskics and other Public Institutions are benefiting from this service. RITA continues to monitor the quality of service, arid etisurtis that service level agreements (SLAs) are honoured.

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Regional Cooperntion

10. Global and regional forces have had significant impacts on the emergence o f the Information Society. Regional cooperation i s regarded as an important component of an international strategy for promoting sustainable development and an instrument in itself for promoting thc integration between countries and attaining the Millennium Development Goals. Increasing attention i s being given to issucs o f East African Submarine Cable System (EASSy)- nieant to establish a 9,900km undersea cable system connecting Mtunzini in Durban, South Africa to Port Sudan, completing a fiber optic loop around Africa., New Partnership for African Development (NEPAD), COMESA - The recently concluded Council o f Ministers in KigaIi also adopted that the communication antenna o f mountain Karisirnbi i s to be part o f regional projects, as well as the Indian Sateliitc connectivity program.

Challenges ahead

I1 During the official opening o f the Regional KCT invcstrncnt Summit in Kigali, on bfoy 2006, President Paul Kagamc said "l)iscasc, illiteracy, poverty and other i l l s are real social cliallcngcs that must be addressed if we are to attain a good quality o f life. We must, thercfore, seek to develop coflective and harmonized strategies to alleviate t l m e challenges". W e aspire to transform Rwanda into a technological huh within thc great lakes region by providing low cost and accessible means to communicatc with in the region and beyond.

17. A Major constraint also in the development of ICT for the poverty reduction has been thc establishment of broadband bandwidth connection at affordable cost. Currently the most common way to access xhe internet i s through dial-up connections, a narrowband seivice uhich use5 the existing local telephonc network and i s mostly charged on the basis 01' h e . IIowever some o f the achievements havc been made through the governnierrt-private sector partnership but s t i l i there is a need for the government to develop the government network ring with a dedicated gateway to the government, which wiXl provide reliable and affordahlc services to the government departments and citizens.

13. One of the challcngcs that Rwanda faced during ?lie irnpIemerxtat.ion o f the first NICT Plan was in the area o f mobilizing resources to facilitate the inpicinentation o f the programs and the initiatiiws o f the plan. Rwanda will require assistance from i t s development part Iike the World Bank in the impiernentation of the NICI-2010 Plan,

14. Encrgy has been a stumbling block in ainiost al l the sectors ofthe economy. Production output has lowered in some cases by 50 percent due to power outagcs. Our products cannot compete favorably with others in the region due to high energy larilfs.

Government Strategies and Requested Support for eRwanda Project

15. The eRwnda project wi l l fucus on improving specific serviccs that arc ofvalue for the population (casy ifcccss tu ~ h t information on health, agriculture, cnvironment, Government guides etc.) as well as supporting the development o f a common I T architactural framework commensurate with national ICT policy. Govemmcnt capacity vdl be build to select, dcsign, ar.d itnnplement ICT programs and participate in e-government activities. additional capacity biilding opportunities activitics will be provided to manage ICT investments and deployments consistent with this architecture. ICl' infrasnucturc: sdl also link to the

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implcmcntation o f a national infrastructure network in collaboration with ongoing rcgionaf infrastructure initiatives.

The Government’s strategy for eRwanda focuses on the following major elements::

* Strengthening of government effectiveness

16. n i c Govcmment strategy aims at improving key internal systems which are considered critical elements for the implementation o f the overall developnient strategt o f the Government. Such systeins include (i) the development and deploymcnt o f a modern integrated public financial management system that prox4dcs timely and accwate information on the use of public resources, and (ii) the implementation o f public procurement and asscts management system that i s in l ine with international standards. Support for thcsc reforms i s aiready programmed under the World Bank Public Sector Capacity Building Project ,and undei the joint World Bank-European Union Trust fund for Public Financial Management.

17. The Project will build on these reforms and assist Government in (i) devcloping standards for the deploynent o f the new system to central niinistrics, proviiicid and district offices, (ii) cquipping in particular provincial and district offices, (i i i) putting in place a network infrastructure (WAN) that connects all relevant institutions at the national and sub- national fcvels, (iv) establishing a maintenance and support infrastructure for the ICT applications, and (v) complement training and capacity building activities in particular at the provincial and district levels.

18. Support under the Project wi l l also include the implementation o f ‘quick wins‘ or earIy results, in particular in Government services with a direct intexface with the population such as vehicle registration and border control. At 8 later stage, it i s also cnvisagcd to inclade the modernization o f other government scrviccs, in particular case management in the judiciary as wcll as thc modernization o f postal or banking systems.

19. eRwafida wil l also contribute to the delivery o f improvcd scrvices to citizcns and the private sector, It will primarily target thc following scwices (i> business licensing, and (ii) crtilcn’s h fe cycle events such as birth, marriage and death certificates. These services w i l l be subjected to a reengineering process with the goal to improve access and service standards.

20. I t i s also envisaged that introduction of XCT wil l to improve delivery o f sewices in key sectors such as health, cducation. and agriculture. This support aims at complementing existing sector rcforms. In this context, sector ministries will be supported in identifying specific sewices to be improved through the use o f IC?‘. The Main focus will be to improve wcess to information 011 basic health and education scrviccs as wcll, to disseminate vital information important for the livelihood o f citizens. Specific interventions w i l l include the dibserniriatiuri of *Citizen’s Guides’ and other crucial information of key governmcnt sewiccs (e.8. health, education, agriculture. and environment) to districts and local cornmunitics. This infomation will be provided thraugh public acceRs points or through other means such as the internet, radio, brochures etc. T h e Project will also provide assistance for the implication o f communities in content development and dissemination mechanisms to better focus public scrviccs and to dctcrrninc what irrfomation i s essential far Iocd communities,

.

Service delivery improvements fur citizens and the private sector

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21. The project wil l fund the development and maintenance o f public access points in both urhan and rural areas so that the serviccs and informition can be made available to the public,

* Tmproving Physical Access to Services through enhanced Infrastructure in Energy and Telecommunications

22. eRwanda will also assist Government in developing and refining the basic regulatory and institutional infrastructure that i s required for the use of modern technoiogy by the public and private sectors. I t will particularly promote the povision o f competitive and affordable telecommunications access for remote areas of Rwanda. The Proiect will support:

, The reinforceinelit o f the legal, policy and regulatory framework foe the use of modem technalogy and the implcmcntation o f cGovcrnment applications. I t will also strengthen thc operational efficiency o f the regulating agency for the telecommunication sector (RLM). In this context, technical assistance will he provided to strengthen the capacity o f RUKA to effectively regulate and monitor the sector.

* The improvement o f basic connectivity infrastrucrure that i s necessary to ef’fcctively disseminate and exchange information - such as telcconi connections to central ministries, provinces and district ofices, as well as l i nks to public access points in rural areas.

Implementation Arrangements for eHwanda Project

24. The cRwmda Project wi l l bc irnplcmciited by the Rwanda Information Technology Authority (RI’I’A), which operates under the anthority of the Ministry o f Infrastructure (MINWRA). RITA i s the government body mandated to coordinate all ICY projects The day-to-day operations o f the Project will be ensured by a dedicated eRwanrla implenicntation team headed by a full-time Project Mantrgcr. The team i s composed of RITA staff fully integrated into the organizational structure o f RITA. IUTA Board o f Directors comprising representatives from the goternment, the private sector and civil society n41l provide technical oversight while Minister o f State in charge of Energy and Communications wil l ensure political oversight by suhinittitig quarterly report to the Cabinet as a part o f monitoring, evaluation and reporting on the implementation of NfCI 11 plan

The Government i s requesting World Balk support to finance incremental salaries. of the eRwanda implementation team during a transition period within whieti the Government wi l l integrate the salarics into the annual hudget. T h e transitional funding \+ill tilIos~ Government to work out an incentive schcme - consistent with existing salary rules and repdatioiis - that

l e to attract qualified pGr5onnd into the public sector It i s programmed to fully integrate the cosis ofthe entvanda implementazion into the annual budget for the year 2008.

25. Further~nore, because the cRwaiida project i s a fundamenid pat1 uf (he NICI X I Plan. the Govcrruncnt has requested that the project be placed on fast track, with highly competent and motivated staff. In order to ensure t h i s arrangeinent it i s envisaged that the project will f i i t e i z w iacren’iental salaries o f the eRwanda impletnetitation team during a transition period within which the GoK will integrate the salaries into the atitiuul budgct. The trtinsitional funding would also allow Government to work out an inccntiw scheme consistent wi th existhg salary rilles and regulations for public institutions that i s able to attract and retain qualified personnel into the public seclor. I1 i s programmed to fully integrate the costs of project implementation into the budget for the year 2008.

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26. To ensure proper use uf funds, slrinyent accountability arrangements shall bt: put in place and enforced. Proposals and applications for funding for the implementation o f eRwanda activities by the beneficiaries shall conform to the procedures and formats for validating achievements o f planned outputs. Monitoting & Evaluation systems shall he established at the level of implementing agencies. ‘ h e management of &wan& project wi l l prepare tparterly reports on the implementation o f the progmms as well as statcmznts o f revenue and expenditure for submission to the Government o f Rwanda. The Government will also ensure that a comprehensive information, education, and coinmuriication strategy i s designed and implemented on a continuous basis in order to ensure ownership, information and consultation of the program, moiigst all stakcholcleru.

Social Impact

27. IC‘f can help to facilitate free flow o f information (thereby supporting democratization of otherwise insular societies) and lead to increased transparency o f the Government opcrttions through eRiwanda initiatives. The value of products and services is increasingly becoming a [unction o f theii information content and the knowledge used to prnduce thein rather than the raw material content. Thercfore, the ability tu easily access and share information and stimulate the creation o f new ideas i s viewed as essential to maintaining a strong economy and enhancing quality o f life o f every citizen. As a drjver for improved social and economic condiiioiis, the tioK intends to harness the I C 1 capacity building under the project to educate its citizens and stimulate private sector development. thus generating employment opportunities. Specific income generating activitics w i l l be targeted to women genocide survivors and their families, as well as content geared toward govemcnl services for citizcns, focusing on issues related to family health and well-being. protection o f the environment, and peace Initiatives. Sociu-economic activities; eRwanda project brings together buyers and sellers and facilitates the tlow o f information, making i t a key driver of trade.

28. I n agriculture, easier and faster access to up-to-date market and price inlitmation assists fbrmers and rural-based traders in their businesses. eRwanda will also delicer better access to information on improved seeds, availability of fertilizers, weather forecasting, pest control and other agricultural-rr1ated services.

29. Finally, through information shuiing, eRwattda wi l l play an important role in politics and governance, by enhancing the government’s ability to provide security for i t s eiti7ens, protect i ts borders auld more eEcient1y handle civil emergencies and national disasters. In turn, tiit: citiyens gain easier access to government and greater awareness o f government programs and activities. An informed populace helps protect the democratic process. I t i s a duty o f everybody. especially those with skil ls and knowledge, to raise awareness o f IC‘I’s, its usefulness in national development for rfie betterment of all citizens. Consultation with Development Partners

30. The Government deeply appreciates thc untiring support o f thc World Bank: team throughout project preparation and in availing a Project Preparation Facility (PPF) through Public Scclor Capacity Building Project at Hlr),4 to finance preparatory activities. The Government also appreciates the Bank’s proposed IDA support through eRwmda project. to the implementation of the Government ICT policy and plan. 31. ’ Ihe Governlent also recognizes the positive responsc and continucd support tthich SIDA-Sweden i s providing support to RITA. SIDA-Sweden i s working closely with the Cjovc~mnent of Kwanda and has asked to be kept informed on the development for the

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cRwanda project for possible funding support. Additionally UNDP has launched ttvo initiatives directly supporting 1C"r development in the country: (i) ~ ~ p p o r t for the development o f IC1' policies and standards at the ministerial level; and (ji) a study o f public Enfbrmation kiosks. The project team i s working closely uith UNDP to support thew two activities. ConsuItations also were held with LSAID, which is funding thc Last M i l e Initiative for the coffee cooywratiwb and private sector strengthening.

Conclusion

32. Mr. President, in order for the CioR to successfuify accomplish i t s development goals.

mor(: ne& to be done, particularly if thc couritry i s to realize i ts v i s ion 01' transforming Rwanda into an information and knowledge-based society and economy through the modernization o f the econoniy and society using ICTs as an cngine for accelerated development and economic growth, national prosperity and global competitiveness. To accomplish this vision it i s essentiai to focus (XI the drivers o f growth. A significant driver of gro\td,h in Rwanda i s 1C1' development, and tho COR i s fully cnrnrnittcd to capitaliding on it, and incorporating ICT as a vital part of iu development stratcyy. The tioR has achieved a reillarkable lcvcl o f computerization in the rwelvc ycars since the genocide, and i s continuing to do m with i t s strong commitmeitt to further ICT developmcnt. We recognize that national ownership and commitment are key to thc succcssful iniplenientarion of eKwanda activities. At the same time the continuing cngagcment of the international comrnuninity through policy dialogue and material assistance i s essential.

33. Your approfa1 of this request tliercforz IS criicial, as it lays strong foundation from which other development partners will join hands in the efforts ta\sards the implementation o f the reninining pmjccts under N I C I 11 plan. The C'jnverni:~rnt v i cws tho partnership with IDA, particularly tlzrough the prtlposcd Credit for efiwanda projcci, 8s B conxinuation o f your institution's support in this effort.

Please accept. Mr. President t high est cons i de r a fion.

cc: - ?-E. The President ol'thc Republic ofRwanda - Rt. Hon. Prime Minister - hlinisrer o f Foreign Affairs and lnternational Corporation - Mininer o f Infrastructurc - Minister o f State in c h u g o f Energy and Communicatioiis - ' I l te World Bank Country Manager - H.E Ambassador uf'Rwanda to the I.J.S.A.

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VVii rruunnggaa

MMttss..

G I K O N G O R OG I K O N G O R O

C YC YA N G U G UA N G U G U

K I B U Y EK I B U Y E

G I S E N Y IG I S E N Y I

R U H E N G E R IR U H E N G E R I

B Y U M B AB Y U M B A

K I G A L IK I G A L IK I B U N G OK I B U N G O

B U TB U TA R EA R E

G I TG I TA R A M AA R A M A

RwumbaRwumba KitabiKitabi

RurambaRuramba

KibingoKibingo

KibehoKibeho

MuniniMunini

KaramaKarama

KarabaKaraba

GatagaraGatagara

MasangoMasango

RusatiraRusatira

NyabisinduNyabisindu

RuhangoRuhango

BugeseraBugesera

ShyorongiShyorongi

MuhuraMuhura

KinyamiKinyami

MbogoMbogo

RundaRunda

RusumoRusumo

KigaramaKigarama

SakeSake

KayonzaKayonza

RukaraRukara

KiziguruKiziguru

KayonzaKayonza

GabiroGabiro

NgaramaNgarama

GatundaGatunda

RwamaganaRwamagana

RilimaRilima

GikoroGikoro

BicumbiBicumbi

GashoraGashora

KanziKanzi

RweseroRwesero

BulingaBulinga

NgaruNgaru

MulindiMulindi

NyagatareNyagatare

KiramboKirambo

ButaroButaro

NembaNemba

BusogoBusogo

NgororeroNgororero

MurambaMuramba

KagaliKagali

NyondoNyondo

KabayaKabaya

MabanzaMabanza

MurundaMurunda

GishyitaGishyitaBwakiraBwakira

NgomaNgoma

KidahoKidaho

KKaaggeerraa

GikongoroGikongoro

ButareButare

GitaramaGitarama

ByumbaByumba

GisenyiGisenyi

RuhengeriRuhengeri

KibuyeKibuye

KibungoKibungo

CyanguguCyangugu

KIGALIKIGALI

LacLacIhemaIhema

LacLacKivumbaKivumba

LacLacHagoHago

LacLacMikindiMikindi

LacLacRwanyakizingaRwanyakizinga

LacLacBureraBurera

LacLacRuhondoRuhondo

LacLacNashoNasho

LacLacCywambweCywambwe

LacLacMpangaMpangaLacLac

MugeseraMugesera

LacLacCyohohaCyohoha

SudSud

Lac Lac MuhaziMuhazi

G I K O N G O R O

C YA N G U G U

K I B U Y E

G I S E N Y I

R U H E N G E R I

B Y U M B A

K I G A L IK I B U N G O

B U TA R E

G I TA R A M A

Bugarama

Rwumba Kitabi

Ruramba

Kibingo

Kibeho

Munini

Karama

Karaba

Gatagara

Masango

Rusatira

Nyabisindu

Ruhango

Bugesera

Shyorongi

Muhura

Kinyami

Mbogo

Runda

Rusumo

Kigarama

Sake

Kayonza

Rukara

Kiziguru

Kayonza

Gabiro

Ngarama

Gatunda

Rwamagana

Rilima

Gikoro

Bicumbi

Gashora

Kanzi

Rwesero

Bulinga

Ngaru

Mulindi

MuvumbaNyagatare

Kagitumba

Kirambo

Butaro

Nemba

Busogo

Ngororero

Muramba

Kagali

Nyondo

Kabaya

Mabanza

Murunda

GishyitaBwakira

Ngoma

Kidaho

Kagera

Gikongoro

Butare

Gitarama

Byumba

Gisenyi

Ruhengeri

Kibuye

Kibungo

Cyangugu

KIGALI

D E M . R E P .O F

C O N G O

B U R U N D I

T A N Z A N I A

U G A N D A

Kagera

Nyabarong o

Akany

aru

Kag

itum

ba

Lac KivuLac

Ihema

LacKivumba

LacHago

LacMikindi

LacRwanyakizinga

LacBurera

LacRuhondo

LacNasho

LacCywambwe

LacMpangaLac

Mugesera

LacRweru

LacCyohoha

Sud

Lac Muhazi

To Sake

To Rutshuru

To Kisoro

To Kabale

To Kikagati

To Kafunzo

To Bugene

To Lusahanga

To Kirundo

To Ngozi

To Kayanza

To Cibitoke

To Cibitoke

To Walangu

To Nyya-Ghezi

Virunga

Mts.

VolcanKarisimbi(4519 m)

30°00'E 31°00'E29°30'E 30°30'E

29°00'E

29°00'E

30°00'E29°30'E 30°30'E

2°00'S

2°30'S

2°00'S

1°00'S

1°30'S1°30'S

RWANDA

0 10 20 30

0 10 20 30 Miles

40 Kilometers

IBRD 33471

OC

TO BER 2004

RWANDASELECTED CITIES AND TOWNS

PREFECTURE CAPITALS

NATIONAL CAPITAL

RIVERS

MAIN ROADS

RAILROADS

PREFECTURE BOUNDARIES

INTERNATIONAL BOUNDARIES

This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information shown on this map do not imply, on the part of The World Bank Group, any judgment on the legal status of any territory, o r any endorsemen t or a c c e p t a n c e o f s u c h boundaries.