Document ofThe World Bank

FOR OFFICIAL USE ONLY

Report No: 22452

IMPLEMENTATION COMPLETION REPORT(SCL-43710; PPFB-P3130)

ONA

LEARNING AND INNOVATION LOAN

IN THE AMOUNT OF US$5.0 MILLION

TO THE

REPUBLIC OF COLOMBIA

FOR A

MAGDALENA MEDIO REGIONAL DEVELOPMENT PROJECT

June 27, 2001

Environmentally and Socially Sustainable Development Sector Management UnitColombia, Mexico and Venezuela Country Management UnitLatin America and the Caribbean Regional Office

This document has a restricted distribution and may be used by recipients only in the performance of theirofficial duties. Its contents may not otherwise be disclosed without World Bank authorization.

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CURRENCY EQUIVALENTS

(Exchange Rate Effective December 2000)

Currency Unit = Peso2184 = US$ 1.00

US$ 1.0 = 0.000458

FISCAL YEARJanuary 1 - December 31

ABBREVIATIONS AND ACRONYMS

CAS Country Assistance StrategyCDPMM Consortium for Development and Peace Magdalena MedioCINEP Center for Research and Popular Education

(Centro de Investigacion y Educacion Popular)CMDR Municipal Council for Rural Development

(Consejo Municipal de Desarrollo Rural)CMP Municipal Planning Council (Consejo Municipal de Planeacion)DNP National Planning Department (Departamento Nacional de Planeacion)ECOPETROL National Oil Company (Empresa Colombiana de Petroleo)ELN National Liberation Army (Ejercito Nacional de Liberacion)ICR Implementation Completion ReportLIL Learning and Innovation LoanM&E Monitoring and EvaluationNDP National Development PlanNGO Non-Governmental OrganizationPAD Project Appraisal DocumentPDPMM Program for Development and Peace of the Magdalena Medio Region

(Programa de Desarrollo y Paz para el Magdalena Medio)PNR National Rehabilitation Program (Program Nacional de Rehabilitacion)PPF Project Preparation FacilityTA Technical AssistanceU JNDP United Nations Development ProgramIJNPF United Nations Population Fund(Q)AG Quality Assurance Group

Vice President: David de FerrantiCountry Director: Olivier Lafourcade

Sector Director: John RedwoodSector Manager: Shelton Davis

Sector Leader: Adolfo BrizziTask Team Leader: Elsie Garfield

FOR OFFICIAL USE ONLY

COLOMBIAMAGDALENA MEDIO REGIONAL DEVELOPMENT PROJECT

CONTENTS

Page No.1. Project Data 12. Principal Performance Ratings 13. Assessment of Development Objective and Design, and of Quality at Entry 24. Achievement of Objective and Outputs 55. Major Factors Affecting hnplementation and Outcome 9

6. Sustainability 117. Bank and Borrower Performance 128. Lessons Learned 14

9. Partner Comments 1710. Additional Information 18Annex 1. Key Performance Indicators/Log Frame Matrix 19Annex 2. Project Costs and Financing 24Annex 3. Economic Costs and Benefits 26Annex 4. Bank Inputs 27Annex 5. Ratings for Achievement of Objectives/Outputs of Components 30Annex 6. Ratings of Bank and Borrower Performance 31Annex 7. List of Supporting Documents 32

Annex 8. Borrower's Contribution to the ICR 33Annex 9. ECOPETROL's Contribution to the ICR 39

Map IBRD 29517

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosed withoutWorld Bank authorization.

Project ID: P046031 Project Name: MAGDALENA MEDIO REGIONALDEVELOPMENT PROJECT _

Team Leader: Elsie B. Garfield TL Unit: LCSERICR Type: Core ICR Report Date: June27, 2001

1. Project Data

Name: MAGDALENA MEDIO REGIONAL L/C/ITFNumber: SCL-43710;DEVELOPMENT PROJECT PPFB-P3130

CountryIDepartment: COLOMBIA Region: Latin America andCaribbean Region

Sector/subsector: MC - Community Action Program; MY -Non-Sector Specific

KEY DATESOriginal Revised/Actual

PCD: 03/10/98 Effective: 10/13/98 10/09/98Appraisal: 03/10/98 MTR:Approval: 06/30/98 Closing: 12/31/2000 12/31/2000

Borrower/ImplementingAgency: REPUBLIC OF COLOMBLA/NATIONAL PLANNINGDEPARTMENT/CONSORTIUM FOR DEVELOPMENT AND PEACEMAGDALENA MEDIO

Other Partners: ECOPETROL, UNDP

STAFF Current At Appraisal __

Vice President: David De Ferranti Shahid Javed BurkiCountry Manager: Olivier Lafourcade Andres SolimanoSector Manager: John Redwood Maritta Koch-WeserTeam Leader at ICR: Elsie Garfield Elsie GarfieldICR Primary Author: Elsie B. Garfield; Natalia

Gomez; Jairo A. Arboleda

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HTJN=HighlyUnlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: HS

Sustainability: L

Institutional Development Impact: SU

Bank Performance: HS

Borrower Performance: HS

QAG (if available) ICRQuality at Entry: S HS

Project at Risk at Any Time: No

3. Assessment of Development Objective and Design, and of Quality at Entry

3.1 Original Objective:The Program for Development and Peace of the Magdalena Medio Region (PDPMM) was initiated in 1995by the Consortium for Development and Peace Magdalena Medio (CDPMM) with support from thenational petroleum company (ECOPETROL) and the Catholic church. The Magdalena Medio region doesnot correspond to a single political-administrative unit. It is composed of 29 municipalities located in 4Departments (Antioquia, Santander, Bolivar and Cesar) which share the following characteristics:proximity to the Magdalena River and its culture, influence of the petroleum industry and importance ofECOPETROL, recent settlement (major influx in the 1950s), inattention (at least until recently) of theDepartments in which the municipalities are located, and a high level of armed conflict and violence. Amajority of the population of around 810,724 live in rural areas or secondary towns, while 36% of thepeople live in two cities, Barrancabermeja and Aguachica.

The project development objective of this Learning and Innovation Loan is to develop the operationalcapacity of the Consortium, citizen's network and other partners to work together towards collectivelydefined objectives to reduce poverty and increase peaceful coexistence in the Magdalena Medio region.The two-year LIL would thus establish a solid basis for the detailed design and implementation of anambitious ten-year community-led, multi-sectoral development program.

The project's development objective was clear. The objective focused on learning and capacity buildingwhich was realistic given the pioneering nature of the project for both the Bank and the Government ofColombia: promotion of a community-based participatory approach to development and peace in one of themost conflictive regions of the country. The associated learning objectives were well defined, as well as themonitoring and evaluating system for ensuring a continuous learning mode and assessment of results.

This project was of critical importance to Colombia. It was one of the first lending operations in the newarea of Bank assistance to Colombia, peace and development, identified by government authorities and civilsociety representatives as Colombia's number one development priority and incorporated as such in theCountry Assistance Strategy (CAS) presented to the Board in late 1997 (Rpt. 17107-CO). As noted in theCAS Progress Report presented to the Board two years later (R99-201, November 1999), the importanceof this project and Bank assistance in this area increased when a new presidential administration took officein August 1998 with peace as its central objective. Its National Development Plan (NDP) for 1998-2002,established a two track approach to the peace process: (i) at the national level, negotiations for peace withvarious armed groups; and (ii) at the regional and local level, promotion of initiatives to build social capitaland address the root causes of violence. The PDPMM had defined a community development approach,being tested under the project, which was the key source of the new government's thinking about how topromote development in conflictive regions.

The LIL was chosen as the appropriate lending instrument and the project objective was shaped to reflectthe need to build capacity and test the feasibility of the participatory approach and promotion of along-term development program in the complex conditions of the Magdalena Medio region. In this respect,the objective was appropriate to the situation.

3.2 Revised Objective:Objectives not revised.

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3.3 Original Components:The project had two components which are described below:

Component 1. Capacity Building for Program Management (US$3.12 excluding PPF refinancing). Theobjective of this component is to build the capacity of the Consortium and Citizen's Network to implementthe PDPMM.

Sub-Component 1.1: Consortium as Change Agent and Program manager. The objective of thissub-component is to develop the Consortium's capacity to move from a participatory planning mode to anoperational mode characterized by: (i) acting as a catalyst (promoter, intermediary, advisor and financier)among relevant beneficiaries and stakeholders; (ii) translating local initiatives into viable action plans andinvestments; (iii) promoting the establishment of effective partnerships with other organizations to supportdevelopment initiatives; and (iv) dealing effectively with the diverse interests of key stakeholders in theregion.

Sub-Component 1.2: Citizen's Network The objective of this sub-component is to strengthen the Citizen'sNetwork so that it is capable of influencing public affairs and implementing development projects based onlocal initiatives. The network is a voluntary association of citizens and organizations which has its base in anucleo in each municipality, representatives of each nucleo in the nodo at the subregional level andrepresentatives of each nodo at the regional level. It has a central role in program implementation and isconsidered by the Consortium as a vehicle for building social capital in the region.

Component 2. Sub-Projects (US$2.75 million). The objective of this component is to develop, test anddocument approaches which bring together community processes and resources around specificdevelopment initiatives agreed upon by citizens and authorities of selected municipalities or sub-regions ofMagdalena Medio. Strategies and sub-projects are at various stages of development in the following areasidentified as priorities by communities: education, health, environment, economic development, peacefulcoexistence and institutional development.

Sub-Component 2.1: Technical Assistance for Sub-Proiect Preparation. Technical support (technicaladvice, feasibility and design studies, building of management capacity and establishing links with potentialpartners and financiers) will be provided to a community to develop a specific development initiative orsub-project.

Sub-Component 2.2: Sub-Projects. The project will finance a proportion of the costs of specificsub-projects which are expected to cost less than US$50,000. This sub-component will have a phasedapproach (a LIL within a LIL): financing would begin in strategic areas such as education, health andenvironment which are well defined, and new areas would be phased in based on two criteria i.e. thestrategy is ready and the implementation capacity of the Consortium and communities is judged sufficientto expand the component's scope.

The project components were well designed, with clear results linked coherently to the project'sdevelopment objective and a well-designed monitoring and evaluation system for assessing impact andresults. Capacity building through a "learning by doing" approach was an explicit objective of the project'stwo components in order to pave the way to realize the long-term regional development program. Thus, theproject design explicitly took capacity into account with some special efforts related to increasing theadministrative and financial management capacities of the Consortium, and during this process to rely onUNDP to support certain project management functions.

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This project drew on lessons from various sources. The Bank team brought to the project design lessonsfrom: (i) the Bank's evolving approach for integrating concern for conflict into development operations; (ii)the positive experiences in promoting rural development in Brazil; as well as (iii) the Bank's experiences inColombia particularly with the Rural Development Investment Program (ICR Report No. 16721, June1997) which it supported for 20 years. By far, the most important lessons which shaped the approach to betested under the LIL were brought to the project design by the Consortium team in particular those who hadworked in CINEP (one of the founding members of the Consortium) which had a long history of carryingout participatory-action research, and promoting informal education. CINEP had also worked inconflictive areas under Colombia's National Rehabilitation Program (PNR) which promoted communitydevelopment and participation in conflictive regions from 1984-1994. In addition, a member of theConsortium team participated in a Bank-sponsored study tour of Social Funds in Latin America whichallowed the CDPMM to draw on relevant aspects of this experience for design of the project's secondcomponent.

3.4 Revised Components:Components were not revised.

3.5 Quality at Entry:The QAG FY99 Quality at Entry review rated the operation satisfactory. The in-depth assessment panelindicated that the project was a high priority for the Government and CAS; that in its narrow formulation,the objective of the LIL is clear and realistic; that it considered the LIL the most appropriate instrument forBank support; that there is sufficient clarity in the project's design regarding what is to be learned and theindicators to measure the learning experience are well developed; and that there was a high level ofborrower and partner commitment. The panel raised some concerns about financial management; readinessfor implementation since the operational manual for the sub-projects had not yet been approved; andbroader concerns about the feasibility and risks of scaling up after the LIL to carry out the ambitiousobjectives of the PDPMM.

The ICR assessment of quality of entry is highly satisfactory which is consistent with the project's resultson the ground, the findings of the QAG, and the fact that the QAG's specific concerns were effectively dealtwith during implementation. The project's financial management was adequate as indicated by the externalauditors, and it was completed on time. The project is regarded by some in the Bank as an exemplary use ofthe LIL instrument in terms of the design and manner in which it was carried out; it has been examined andhighlighted as an appropriate example of a LIL in the two reviews of adaptable lending. The project washighly consistent with the CAS and Government priorities. Bank safeguard policies were adequatelytreated. The project squarely addressed the main risk factor which was external to the project, the evolutionof the armed conflict in the region and Colombia. One of the fundamental purposes of undertaking the LILwas to explore the potential and limitations of a strongly participatory, community development approachwithin a context of conflict. The situation of armed conflict and insecurity in the region worsened during thecourse of the project, due mainly to factors related to the national peace process (see section 5.1). Theability of the Consortium to successfully work in this environment, and the effectiveness of its approach topromoting development in the midst of conflict were demonstrated. The mechanisms for carrying out theproject (semi-annual plans, operating manual, quarterly M&E reports) worked well in this difficult andquickly changing environment, and proved effective as learning tools though they were difficult for theConsortium to master initially. Thus, the project design achieved the right balance between planning andflexibility.

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4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective:The project's outcome is highly satisfactory despite worsening security conditions in parts of the region dueto external factors during the two and a half year implementation period. The participatory, communityoriented methodology for promoting development in the midst of conflict piloted under this project hasproven effective at creating a longer term vision of a better future for the region, strengthening the region'shuman and social capital, mobilizing resources and attention for the region, and starting a community-ledprocess of improving basic services and investment which can be scaled up as the PDPMM progresses.The project's development objective of increasing the operational capacity of the Consortium, citizen'snetwork and other partners to work towards collectively defined objectives was achieved. There is ampleevidence in the two external evaluations (carried out by a reputable university research institute), theproject's quarterly monitoring and evaluation reports, and other reports prepared for the ICR (Annex 7) ofa positive assessment of all 4 of the key impact indicators (Annex 1 of this report).

The two external evaluations which relied on significant field work in a sample of five municipalitiesprovided strong evidence of the perception at various levels that the PDPMM has made a positive andimportant contribution. The second external evaluation completed in late November 2000 reinforced thefirst evaluation's conclusions that: the program's philosophy and objectives have been internalized by theparticipants, that involvement in the program has increased self-esteem of both individuals and groups, andthat capacities have been increased. Thus, the most striking achievement is the increase in human and socialcapital: the citizens network now includes 23 nucleos and 147 organizations involving 8,625 persons whohave internalized the vision and goals of the program. The capacity of the Consortium has beensubstantially increased, as evidenced by its ability to operate in the increasingly complex situation in theregion, to mobilize and effectively use US$7.0 million (amount directly managed by CDPMM) during theperiod of the LIL, and to assist communities with 67 sub-projects with tangible results in terms of increasedcapacity of the organizations promoting them.

The project's impact goes beyond its development objective and achievements in the Magdalena Medioregion. It has contributed to: (i) the Government's thinking and strategic approach to development inconflictive regions, including the concept of delegating implementation to a respected third party (seeAnnex 8); (ii) Colombia's image and the ability to raise funds to support the peace process (the PDPMM'sachievements have been showcased in international forums such as the World Economic Forum in Davos,Switzerland in January 2001, and in donors meetings in London, Madrid and Bogota); (iii) inspire andprovide technical support for the initiation of regional development programs based on similar principles in9 other regions of Colombia; and (iv) a new way of working for the Bank, Government, and other keyparticipants including communities characterized by a learning mode and partnerships which could serve asan example for other projects in Colombia.

4.2 Outputs by components:As indicated in Section 3.3, the design of the project components was appropriate for achieving the definedoutputs, and a combination of qualitative and quantitative performance indicators were defined in the PADand assessed during implementation (see Annex 1 of ICR).

Component 1. Capacity Building for Program Management (US$3.12 million PAD, US$4.81 actual).Sub-Component 1.1: Consortium as Change Agent and Program Manager (US$2.62 million PAD,US$4.11 actual).The performance under this sub-component is rated highly satisfactory. The Consortium achievedrecognition in the region as a serious entity, operating in a transparent manner, efficient in the managementand use of resources, and respectful of citizens' initiatives. The perceptions of direct beneficiaries, partners

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(such as municipal authorities), the general public as well as national authorities were positive about thePDPMM, and the Consortium's contributions were recognized. The Consortium's capacity to work withdiverse stakeholders within the complex and deteriorating security situation in the region was alsodemonstrated.

During the project, the Consortium consolidated its operating and administrative structure which hadpreviously been located in Bogota and quite informal. It subsequently took steps in 2000 to adjust thisstructure, and to initiate a further decentralization in response to concerns of participants and its staff whoindicated the need for a more integrated operating structure closer to beneficiaries with more differentiationin accord with the conditions in the 8 sub-regions. The Consortium progressively improved the content andimplementation of each of the five semi-annual plans. It completed the two and a half year project on timewith the total loan and counterpart fund amount fully disbursed by the closing date. It proved highlyeffective in promoting partnerships with other organizations and bringing new actors into the region tosupport priority development initiatives, as well as in raising additional funds. After some problems in thefirst year of the project, the Consortium developed effective methods for assisting organizations and theirmembers to develop the capacity and knowledge to prepare sub-projects. It creatively adapted themethodology of "rapid results initiatives" (see articles cited in Annex 7) to develop initiatives in a phasedprocess whereby a community organization defines a series of short term results/goals which build capacityand knowledge in an iterative fashion as it prepares an initiative for the investment phase.

While putting in place the monitoring, evaluation and learning system proved more challenging andtime-consuming than expected, the M&E unit provided important feedback and analysis which served as abasis for making adjustments in concepts, methodologies and operations. Critical outputs of the M&E workincluded: eight quarterly M&E reports; a preliminary set of baseline data for the PDPMM; checklists usedby Consortium managers and staff to evaluate progress under the semi-annual plans; key methodologies,instruments and training tools for formative evaluation to be carried out by members of the nucleos andorganizations managing initiatives; initial training on formative evaluation; two external evaluation reports;and special reports on the results of the LIL.

Sub-Component 1.2: Citizen's Network (US$0.50 million PAD, US$0.70 actual).The performance under this component is rated highly satisfactory, even though there are variations acrossmunicipalities. The Consortium conceived of the citizen's network as a vehicle for building social capital inthe region. Under the LIL, the Consortium promoted, tested and refined a participatory methodology(focused on the nucleo) for arriving at agreement among key stakeholders in each municipality aroundlong-term development priorities (municipal proposal) and specific activities and investments to begin toaddress long-term priorities (initiatives and sub-projects). The LIL supported the work of the nucleos indeveloping the municipal proposals through grant funding of six month plans of action; 24 nucleos carriedout at least one plan. In many cases, the nucleo members became increasingly involved in municipaldecisions including in some cases formal or informal involvement in the legally mandated mechanisms forcommunity involvement in planning (CMDR, CMP); in addition, the project supported the strengthening ofthese mechanisms. The 23 regularly operating nucleos are at various stages in developing the municipalproposals. In at least two cases, the municipal proposals developed by the nucleo influenced thedevelopment programs of mayors newly elected in October 2000. Another important achievement was theestablishment, with support from the National Planning Council (a civilian body mandated by the 1991Constitution to oversee the national development plan) of a Regional Participatory Planning System forMagdalena Medio which brought together members of the nucleos, municipal planning authorities, andparticipatory planning bodies.

The actions of the PDPMM through the participatory methodology developed by Consortium, created a setof relations between people and communities that established a sense of common purpose and identificationwith the program's philosophy and objectives-with guiding principles of respect for life, sustainability

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and inclusion. A considerable number of citizens incorporated in their manner of thinking and acting theprinciples and methodology of the program. The methodology proved effective, as confirmed by the secondexternal evaluation, in: increasing the capacity of persons to participate in managing their owndevelopment through nucleos and organizations, creating and strengthening social values (such astolerance, civic-mindedness) and trust, developing a consensus on the role of nucleos, and maintaining thewillingness of people to continue to work together on a collective vision of development for theirmunicipality and the region.

The concept of the citizen's network evolved during the course of the project. The original concept was of anetwork with a pyramidal, somewhat fixed structure. With time and the dynamic of the project'simplementation, the concept became more flexible and horizontal: the network consists of a series ofnetworks of organizations and persons who join together to pursue common interests and objectives; themembers of these networks have a common set of principles, values and participatory work methodologiestransferred to them by the PDPMM. There are currently 10 such networks operating including communityradio stations, youth, and producer associations for fishermen, palm oil and cacao. This process hasexpanded the social base of program.

Component 2. Sub-Projects (US$2.75 million PAD, US$6.67 actual).Performance under this component is rated satisfactory relative to initial expectations which proved overlyambitious, and highly satisfactory in terms of overall achievements. Certain aspects of the component wereadjusted during implementation. Stemming from the Bank's concerns to avoid over-stretching theConsortium's capacity, the concept of this component in the PAD was to phase in financing of specificstrategic areas (defined in sectoral terms) when a well-defined strategy and sufficient capacity of theConsortium and communities existed. This proved unworkable as the Consortium faced pent-up demandfor investment funding, and it proved hard for them to severely limit the geographic coverage of theinitiatives. In addition, the demand was particularly strong for productive projects though this was the areain which they were least experienced. Fortunately, as part of LIL preparation, they had prepared strategiesfor each of the sectoral areas which provided sufficient direction. The Operating Manual provided a basicdecision making framework and guidance for the preparation and implementation of sub-projects,representing a big step forward for the Consortium which had handled these matters in a more subjectiveand informal way previously.

During the LIL, the PDPMM promoted and supported the identification, preparation and start-up of 67initiatives or sub-projects, led and implemented by community and producer/social organizations withsupport from the Consortium. This was a larger number than expected and the dynamic of the participatoryprocess led to a majority of initiatives supported being productive: of the 67 initiatives supported 60 wereof a productive character (20 classified as rural production including agro-industrial projects, 8 asmarketing, 14 as urban production, and 18 related to fishing and the environment). The remainder wereclassified as education (2) and institutional development and peace/conflict resolution (5). In addition, withfinancing from the Ministry of Health and the United Nations Population Fund (UNPF), an ambitiousprogram for the health sector was carried out. Based on the Consortium's assessment at the end of the LIL,51 of these initiatives (76%) accounting for 94% of the total funding for sub-projects either have goodprospects and are worth pursuing (33), or should be considered for continuation if certain conditions aremet (18). Thus, the project successfully contributed to identifying and developing productive initiativeswith good potential to improve the incomes and living standards of beneficiaries. While most productiveinitiatives never fully entered the investment phase during the LIL, a solid basis for investment wasestablished and will be supported in the next phase of the PDPMM. In addition, the education projects andprogram in the health sector have demonstrated good results (see Annex 1, Table 3). The specific lessonslearned in each strategic area are discussed in the documents cited in Annex 7.

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During implementation of this component, the Consortium recognized that the process of helpingcommunities to transform initiatives into investment projects in a way that is empowering was moretime-consuming and difficult than expected. During the first year of the project, the Consortium worked toidentify effective processes for helping organizations develop productive initiatives into investment projects;it realized in early 1999 that it had focused efforts mostly on the capacity building aspects (referred to asendogenous factors) with insufficient attention to the other aspects of a project's feasibility (technology,financing, marketing etc., referred to as exogenous factors). It also recognized that a different skill mix inthe Consortium team and more specialized technical support from outside were required. The CDPMMwas able to take these lessons into account and make notable achievements. By the end of the project, theConsortium decided to move to a more decentralized structure which would put technical staff in thesub-regions as part of integrated teams so that they could provide support and follow-up to communities ona regular basis; this would be combined with greater reliance on specialized technical assistance for specifictasks.

Another important development during the project was the Consortium's decision to move towardsupporting larger, somewhat more complex productive projects covering more than one municipality(referred to as "meso" projects) which they believed would have a greater regional development impact andalso serve to bring several organizations together thus reinforcing the process of creating and strengtheningsocial capital in the region. This increased the challenges as these projects tended to be more risky due totheir higher investment cost and complexity. The approach to productive projects gradually became moreprogrammatic like the approaches in the health, and to a lesser extent, education sectors.

By the end of the project, the Consortium had developed effective methods for assisting organizations andtheir members to develop capacity and knowledge. An important result of the project, to some extentattributable to trial and error, was that the Consortium became more aware of what knowledge andexperience it was unable to provide directly to support initiatives, and it developed a format for provisionof external technical assistance that empowered and improved the capacity of organizations and producers.It used several innovative methods and tools to support the development of productive projects includingbenchmarking ("referencia competitiva") and analysis of economic circuits. The benchmarkingmethodology compared the production processes of individual producers/firms with each other, with otherregions in Magdalena Medio, and with other parts of Colombia, and in some cases internationally. Thishelped producers to: (i) better understand the context in which their initiative was being developed(production chain, accounting and competitiveness issues at local, regional, national and internationallevel), and the technical options, profitability, sustainability and competitiveness of alternative developmentapproaches. To identify productive opportunities in urban areas, analyses of economic circuits (economictransactions in a particular locality, backward and forward linkages of each economic activity, productioncosts and efficiency of each activity) were undertaken.

4.3 Net Present Value/Economic rate of return:Not applicable for this LIL, though during the project NPV and financial rate of return were calculated aspart of the feasibility studies for some of the larger productive projects such as cacao and palm oil.

4.4 Financial rate of return:Not applicable for this LIL; see point 4.3.

4.5 Institutional development impact:The PDPMM promotes partnerships based on shared goals between communities and their organizations,and public and private institutions. The institutional development impact of this project is considered to besubstantial in the following respects:

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* it pioneered a new arrangement provided for in the 1991 Constitution, whereby the Government candelegate to an NGO or third party responsibility for carrying out actions on its behalf. As indicated inits assessment of the project in Annex 8, DNP became convinced that this could be an efficient andeffective way for the government to support development in difficult areas of the country;

* the Consortium was strengthened and refined its role as the program moved into the operational phase.It demonstrated in practice a new way of working, as a facilitator of alliances and partnerships,mediator, and strong promoter of community development. During the course of the project, it becamemore selective about what it needed to do directly and which funds it should manage directly. Itscredibility was critical for bringing other actors into the region and for working with the communitiesand organizations;

* under the project, an approach to building more responsive local institutions was tested which focusedon increasing citizen and community knowledge and capacity--building informed demand--to create aconstituency for better government and local institutions; this contrasts with the usual approach offocusing on the institutions themselves and providing training and other resources with the assumptionthat they want to be more responsive but simply lack the means. Simultaneously, the Consortiumworked with local governments and institutions which showed motivation to develop in ways consistentwith the program's objectives. Notable accomplishments are: the strengthening of participatoryplanning bodies at the municipal level, creation of the Regional Planning System, and the translationinto practice of reforms in the education and health sectors (see Annex 1, Table 3).

5. Major Factors Affecting Implementation and Outcome

5.1 Factors outside the control of government or implementing agency:The key factor outside the control of the government and implementing agency which partially affected theproject outcome was the evolution of the armed conflict and deterioration of the security situation in partsof the region. This was due largely to external factors related to the Pastrana Government's attempts tonegotiate peace starting in mid-1998, and the military and political strategies of the various armed actorsvis-a-vis this process. A series of key events made the situation complex:

v in October 1998, the conquering by the paramilitaries of municipalities in the south of the Bolivardepartment which had for many years been controlled by the National Liberation Army (ELN) and theresulting exodus of 20,000 peasant farmers to occupy schools and other public buildings inBarrancabermeja for 3 months;

* the drawn out and still inconclusive attempt to initiate peace talks with the ELN through the creation ofa meeting zone ('zona de encuentro") in two municipalities in the south of Bolivar department in theareas which the paramilitaries now dominate, and the reaction of the civilian population andparamilitaries against this proposal resulting in a road blockade for more than a month and disruptionsthroughout much of 2000; and

* the launching of a military campaign by the paramilitaries at the end of 2000 to control the poorerneighborhoods in Barrancabermeja which had been dominated for many years by various guerrillamovements.

In addition, the Government's announcement of Plan Colombia generated negative reactions from diversesources including the guerrilla groups, politicians, UN officials, and leaders of civil society organizationsespecially those concerned with human rights. This also affected the environment in which the project wascarried out.

The armed conflict was recognized as a key factor going into the project, and the Consortium was able to

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manage these risks effectively and successfully in order to achieve the project's objectives. However, theproject could have achieved a lot more if it had not had to deal with a situation which became much morecomplex than imagined: requiring a lot of time and attention to manage, resulting in the Consortium beingasked to take on new roles by the Government and others, resulting in fear and intimidation of citizenswhich presented obstacles in certain parts of the region at certain times to the participatory approach, andresulting in setbacks and loss of positive achievements in some cases.

Another key factor affecting implementation which was acknowledged in the PAD, but whose operationalimplications were not fully understood is the heterogeneity of the region. The diversity of conditions in theregion (geo-logistical, political, economic, and particularly human and social capital endowments)combined with the dynamic of the armed conflict resulted in great variation in the rhythm, timetable andcosts of development activities among municipalities, sub-regions, and organizations. During the course ofthe project, the Consortium adjusted its methodologies and expectations for developing municipal proposalsand initiatives to make them more flexible to take into account these differences. In addition, it realized thatthe expectations for the accomplishments under the second component of the LIL were too ambitious.

5.2 Factors generally subject to government control:The main factor affecting implementation which was subject to the government control but had a minorimpact on project outcome was a rupture of project funding in the second quarter of 2000. An unfortunatecombination of inattention by the Consortium which led to submitting a disbursement application late whenfunds in the UNDP project account were low, and the lack of mastery in DNP and the Ministry of Financeof a new integrated computer system for managing public finances (the project was the first World Bankfinanced project to have a disbursement application processed through the new system) led to a severalmonth delay in processing the application and a period when the Consortium had no money. This disruptedthe flow of funds for nucleo plans and sub-projects, but fortunately the Consortium's credibility wassufficiently high that it did not cause serious damage to the PDPMM or the project.

5.3 Factors generally subject to implementing agency control:Throughout the implementation period, there was a frank dialogue between the Bank and Consortium aboutwhat was perceived to be working and not working well. While there were a number of factors subject tothe Consortium's control which arose, none had a major impact on the project's outcome. However, moretimely and decisive action to hire an experienced financial and administrative manager would havesubstantially improved implementation. This delay was costly in terms of getting in place effectivemanagement systems, and in the time spent by other staff (without the requisite level of experience)temporarily assigned responsibility for these functions at the cost of their technical work. When thisproblem was resolved in late 1999, a rapid and remarkable improvement was achieved which wasmaintained for the remainder of the project.

The participatory planning process of the PDPMM prior to the LIL generated high expectations amongmany organizations which had identified initiatives some of which were already receiving support from theConsortium. Unfortunately, the Consortium's lack of a clear definition of entry and exit criteria forsupporting initiatives (the screening criteria in the Operating Manual were very general), and of the typeand limits of the Consortium's support led to: (i) frustration when initiatives were not supported, and (ii)support by the Consortium of initiatives which did not necessarily have good prospects. The need for clearand transparent criteria was one of the project's lessons which will be addressed in the follow-up project.

5.4 Costs andfinancing:The cost estimates in the PAD were approximate given the iterative nature of project implementationthrough the use of semi-annual operating plans, and uncertainties about additional funding (not quantified

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at appraisal) which the Consortium and community organizations would raise from other sources duringthe course of the project. They were successful in fund-raising which resulted in more activities beingundertaken and greater achievements being realized. No significant disbursement or implementation delaysoccurred.

6. Sustainability

6.1 Rationale for sustainability rating:Normally not applicable for a LIL.Since there is much skepticism about whether it would be possible to make progress toward sustainabledevelopment in the difficult circumstances of the Magdalena Medio region, it seems important to addressthis matter. Any achievements in the midst of the current circumstances in the region are fragile, and theability to achieve the ambitious objectives of the PDPMM are subject ultimately to the broader processtowards peace and security in Colombia. However, the Government believes that the project hascontributed to this broader process. The ICR assessment is that the lessons of the project about an effectivecommunity development methodology for a conflictive region, and the capacities that the PDPMM hashelped develop in the people and organizations of Magdalena Medio will live on and be put to good use inthe region or elsewhere, irrespective of the reversals which may be experienced due to a worsening of thearmed conflict. The PDPMM was conceived as a long-term development program which has a high degreeof commitment and ownership within and outside the region; therefore, the process is unlikely to be deterredby short-term reversals. This type of project does not resolve the armed conflict, but it creates conditions tofacilitate dialogue among contending parties, it sets in motion a process for addressing some of theunderlying reasons for the conflict, and it prepares the way for a post-conflict intervention.

6.2 Transition arrangement to regular operations:The Government has consistently indicated to the Bank the importance it places on continuing support tothe PDPMM which is central to its peace and development agenda. In July 2000, the Bank agreed to theGovernment's request to initiate preparation of a follow-up project as part of continued Bank support forthe program; the other key partners (ECOPETROL and UNDP) also indicated their continued support. Inorder for the Consortium to continue its work after the loan funding was exhausted, the Governmentprovided interim funding of roughly US$500,000 from its 2000 investment budget and ECOPETROL'sBoard agreed to provide US$1.3 million (to start disbursing in early 2001) as counterpart funding for thenew project.

The proposed follow-up project will be a second LIL which builds on the lessons and successes of the firstproject, and extends the learning into challenging new areas:

* develop and test new organizational and operational mechanisms for managing the PDPMM whichincrease the role of community organizations, take into account the diverse conditions in the regionparticularly the armed conflict, and gradually decrease dependence on the Consortium;

* further develop and test approaches for strengthening local institutions, both private and public, tomake them more responsive to citizens needs and priorities, and capable of resolving conflictspeacefully; and

* test approaches for implementing productive projects which increase the probability of their success(for example, methodologies to help small producers and the poor develop sound market approachesfor an array of enterprises) and contribution to the economic and social development of the region.

The second project will focus on the three new learning areas within the larger set of objectives, activitiesand funding defined in the Consortium's three-year plan (2001-2003) of support for the next phase of the

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Program of Development and Peace for Magdalena Medio. It will pave the way for a subsequent phase ofthe PDPMM which will be more ambitious in terms of the poverty and peace objectives, amount offunding, and the leadership role of communities.

7. Bank and Borrower Performance

Bank7.1 Lending:The Bank's performance in identification, preparation and appraisal of the project are considered highlysatisfactory. The Bank was approached by the Government and Consortium in April 1996, and asked if itwas interested in joining the PDPMM as a partner. Convinced that this was an excellent opportunity to putin practice its desire to work more closely with civil society, and improve the poverty impact of Banklending through an integrated approach in a region, Bank management was courageous in agreeing toprepare an innovative project in a challenging region of Colombia.

The Bank team worked closely with the Consortium team to prepare a regular investment project, and thenshifted to a LIL when this option became available in mid-1997. The degree of Bank team involvement inpreparation was high and the quality of inputs was good, though at times there was frustration on bothsides as it took time for the two teams to develop a common vocabulary, concept of development, andunderstanding of the practical steps required to get the project approved. The Bank team remained flexibleand open to new ideas, and made a significant contribution to the design in the following respects:encouraging the Consortium to adjust its focus from individual sub-projects to a more strategic approach,defining the learning areas and incorporating them into the design of the M&E system, and bringingpracticality and realism in terms of what could be achieved in a short time in the complex conditions of theregion. As indicated in section 3.3, the ICR assessment is that the resulting design was good, the lendinginstrument was appropriate, and an effective partnership was built.

Some concerns were raised by the QAG about the time and money spent on preparation considering theoperation was a LIL. This stenmmed from several factors: (i) the LIL was not an option until September1997, thus time and money were spent trying to comply with requirements of a regular loan which was notreally suitable for this operation; (ii) the newness of the LIL meant that start-up costs were incurred whilethe team clarified what was required; (iii) the innovative nature of the project and the way it was to becarried out; and (iv) the time required to build a partnership. As indicated by the QAG panel's assessmentof client commitment and the quality of the participatory process, the investment of staff time and moneyled to a very high degree of ownership, trust and partnership with both the Consortium and theGovernment. The ICR assessment is that this was a worthwhile investment.

7.2 Supervision:One of the main concerns of management in approving this project was whether the Bank would be able toadequately supervise the project due to the difficult security conditions in the project area. Despiteworsening conditions in various parts of the region throughout the life of the project, good supervision waspossible and a "continuous" supervision mode was adopted. The measures defined in the PAD for ensuringadequate supervision were effective: (i) working with a highly reputable NGO, fully responsible forcarrying out the project, which has shown the capacity to manage the difficult conditions in the region; (ii)regular feedback in the form of the semi-annual plans and quarterly M&E reports; and (iii) independent,professional assessments of the project's implementation and results/impact by Colombian experts (annualfinancial audits including field visits, and two external evaluations). Fortunately, it was also possible forBank staff to go the region for short visits and a major supervision mission in March 2000.

The ICR rating of the Bank's supervision effort is highly satisfactory which is consistent with the QAG

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assessment that supervision in FY00 was at the high end of satisfactory with a highly satisfactory rating foradequacy of supervision inputs and processes. The QAG noted: the proactive style of supervision in achallenging environment; quick response to issues as they arise; attention to social dimensions andcommunity participation as well as M&E; excellent team composition and continuity; and closemanagement interest and oversight. The Bank team was persistent in getting problems solved, whilerespectful of the Consortium's autonomy. It provided on-going support with a high level of technical inputsfor the proposed palm oil projects, and the monitoring and evaluation system; it also shared new tools suchas the Rapid Results Framework which came out of the Bank's staff training program. The only area wherea bit more attention was warranted was procurement, although only minor issues have been identified.

7.3 Overall Bank performance:The Bank's overall performance is rated highly satisfactory. The Bank was courageous to support thisoperation, and provided the project team the resources and support they needed. The team adopted aconstructive and open-minded attitude which helped build an effective partnership with the Government,Consortium, ECOPETROL and UTNDP, and provided technical support which contributed to the project'ssuccessful outcome. One area identified by the Government and Consortium where the Bank needs todevote more thought is whether further flexibility is warranted in the application of its policies andprocedures to LILs to ensure consistency with the rationale for this lending instrument and to reducetransaction costs.

Borrower7.4 Preparation:The ICR's rating of the Borrower's performance in preparation is satisfactory. The Government andECOPETROL (as the original sponsor of the PDPMM and provider of counterpart funds for the LIL) werecourageous in supporting the PDPMM, and in being willing to try an innovative institutional arrangementwhich delegated project implementation responsibility to an independent NGO. During the preparationprocess, the National Planning Department adopted a low profile and relied on the Consortium to workdirectly with the Bank to define the project's design. While their trust in the Consortium was laudable, inhindsight it would have been useful if they had been more involved in preparation as a means of buildingthe partnership with the Consortium and Bank, and acquiring a more in-depth understanding of thePDPMM and project. However, this did not have any important negative consequences, and DNP carriedout satisfactorily its responsibility for overseeing the project's design and approval. An important positivefactor which sped up project processing was the Government's approval of streamlined procedures forapproving LILs.

7.5 Government implementation performance:The ICR rates the Government's implementation performance as highly satisfactory. DNP exercised itsoversight responsibilities and managed the National Technical Committee effectively; it provided adequateguidance while according the Consortium the independence and flexibility required for it to effectively carryout the PDPMM in the complex conditions of the region. DNP's involvement and knowledge of thePDPMM increased substantially during implementation when they assigned a person full-time to supervisethe project including regular field visits. While there were certain weaknesses in terms of administrativeprocedures, mainly processing of disbursement applications in 2000, DNP and the Ministry of Financeworked actively to solve the problems. Various Government agencies worked closely with the Consortiumand provided support for the PDPMM, including the Ministries of Health, Education, and Agriculture. TheGovernment also played an active role in identifying additional funding sources for the PDPMM. DNP andECOPETROL participated actively in the ICR process to distill the lessons learned during the LIL andshare them more widely in Colombia.

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7.6 Implementing Agency:The ICR rates the Consortium's performance as highly satisfactory. A key project objective was tostrengthen the Consortium's capacity, and during implementation it became clear that its strengths andweaknesses had been accurately identified. The Consortium proved itself to be a learning organization,willing to evaluate and improve its own performance, and to have an open dialogue with others (e.g.communities, external evaluator and donors) about its strengths and areas for improvement. Its majorstrengths demonstrated during project implementation include: the high level of integrity, commitment andprofessionalism of the staff; ingenuity in adapting new tools and developing new approaches for work in theregion; effective communication of the fundamental principles of the PDPMM and ability to mobilizesupport; ability to design and implement a participatory community development strategy; and ability tomanage the risks related to the conflictive environment in which the project was carried out.

Concerning the areas where initial capacity was weak, the Consortium made outstanding progress duringthe course of the project. Major improvements were made in the financial and administrative areaparticularly in the last year of the project, including capacity building and oversight of the 8 sub-regionaloffices, nucleos and organizations carrying out initiatives. The Consortium was able to learn andadequately handle the difficult and at times unclear aspects of managing public funds and a loan from theWorld Bank, although Bank procurement norms were not fully mastered. The quality of M&E isconsidered highly satisfactory and concerns raised in the first external evaluation about slowimplementation of the formative evaluation methodology to be used by beneficiaries was addressed in theremaining 9 months of the project. Midway through the project, the Consortium recognized that the effortto convert initiatives into sub-projects, particularly for agro-industrial projects involving more than onemunicipality, was much more complicated than originally foreseen, requiring a different skill mix in theConsortium team and more specialized technical support from outside. In particular, it took awhile for it torecognize the need for a thorough preparation process for more complex, regional projects. Bank supportconcentrated on this area, and the Consortium was eventually able to make notable achievements. Afterconcern was raised that the procedures for environmental screening of initiatives included in the OperatingManual had not been fully internalized and applied early enough in the project cycle, the Consortium teammade a considerable effort in 2000 to review each initiative's environmental aspects and to handle thesematters in a more timely and effective way. In conclusion, the Consortium brought to the project strongcapacity in critical areas and improved its performance substantially in areas where weaknesses wereidentified during the course of the project.

7.7 Overall Borrower performance:The overall Borrower performance is rated highly satisfactory, with particular recognition for theConsortium's dedication, commitment and contributions in the face of many difficulties. The Governmentof Colombia demonstrated a very high level of commitment to this project and the PDPMM. It wasproactive in seeking Bank and other support for a follow-up project, and obtaining "bridge financing" toensure continuation of the PDPMM until new loan funds are available. During project implementation,DNP was active in recognizing and resolving problems, and made important contributions to the ICRprocess. The Government was respectful of the Consortium's autonomy and point of view, and theymanaged to work well together despite different views on certain Government policies.

8. Lessons Learned

An ICR workshop was held on December 6, 2000 with active participation of the project's keystakeholders including the World Bank, National Planning Department, UNDP, ECOPETROL and somecommunity representatives to assess what had been learned during the LIL. The methodology and results ofthe workshop are presented in the "Memorias del Taller" (attached to the ICR mission's aide memoire

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which is in the project file). The principal lessons identified in the workshop and by the ICR team's analysisare described below.

Operational model for community-based, participatory approach to development in a conilictiveregion of Colombia. The participatory, operational model for promoting development piloted under theproject functioned well in the complex, conflictive environment of the region. The model is characterized bythe following basic elements:

* it is sustained by a change agent (the Consortium) which enjoys high credibility among all thestakeholders;

* it is based on community and individual participation in the making of decisions about the community'sdevelopment, and establishes specific mechanisms for this participation (e.g. the nucleos of thecitizen's network, municipal proposals, and project initiatives);

* it is based on a methodology that takes into account the capacity and 'initial state' of the citizens, andfrom this base initiates the learning and capacity building of community organizations so that they areable to take charge of their own development. Further, it recognizes and supports existingorganizations and previous experiences in these communities;

* it encourages communities to define a long-term development strategy for their community,municipality and region, while supporting "learning by doing" around more concrete and immediategoals and actions;

* the change agent (Consortium) operates in a decentralized manner;

v the change agent's staff (Consortium) act consistently in accord with defined values of respect,transparency, autonomy, and defense of the public interest.

This operational model is not a cookie-cutter approach that can simply be copied elsewhere. There are anumber of critical ingredients in the way the project and larger program of which it is a part are carried outsuch as the commitment and dedication of the Consortium's staff which are not easy to reproduce. Thisdoes not reduce the project or program's importance and impact in the Magdalena Medio region, nor inColombia as a whole.

Requirements: flexibility and continuous learning. The project demonstrated the need for flexibility andcontinuous learning when promoting a participatory approach in such a complex environment, and toexpect a substantial variation in the rate of implementation and development depending on the variedconditions in different parts of the region. A continuous monitoring and analysis of the evolution of thesocio-political situation at the local, sub-regional, regional and national level is an absolute requirement forworking in the complex and quickly changing environment of conflictive regions in Colombia.

Scaling up. One of the lessons in applying the approach described above was that increasing the capacityof individuals and communities to take charge of their own development takes more time than originallyexpected, particularly to develop their ability to prepare and implement productive investment projectswhich translate into increased incomes and better standards of living. Consequently, the original idea that itwould be possible to move directly from the first LIL to a detailed definition and implementation of the fullten-year investment program (with funding from a traditional loan or adjustable program loan) provedoverly optimistic and ambitious. It should be noted that this is also due to the evolution of the armedconflict at the regional and national levels which has increased the complexity and risks of scaling up theprogram rapidly.

Tensions between the participatory process and technical requirements of preparing andimplementing investment projects. The first external evaluation identified a tension and lack of sufficient

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integration between the Consortium's efforts to promote the participatory process of developing a long-termvision of development led by the nucleos, and the development of investment sub-projects by specificorganizations. While this is likely to remain a continuing tension in a program of this nature, theConsortium decided to modify its structure to combine in one structure, at the regional and sub-regionallevel, the functions of promoting participation/community development and developing specific investmentprojects. In this way, these tensions will be recognized and addressed more directly.

Provision of technical assistance in a way that empowers organizations and producers. TheConsortium learned that provision of technical assistance by external experts was effective in buildingcapacity and empowering organizations when through the process of developing an initiative theorganizations themselves: identified what assistance was required, participated in formulating the terms ofreference for the TA, and were involved in all stages of the study as the counterpart of the entity providingthe technical assistance. The organization and its members thus became the owner of the process and fullyappropriated the results. A good example is the feasibility study for the improvement of cacao productionand marketing which was carried out with producer organizations in 3 municipalities. The Consortium'srole in this process was to identify TA providers with the right capacity and a willingness to work in thismanner, and to accompany the process with its staff. It learned to apply a similar process when it wasproviding technical assistance directly. In addition, it developed and used some innovative methods andtools which proved effective in this regard: the rapid results framework, benchmarking of productivepTocesses ("referencia competitiva"), and analysis of economic circuits (see Section 4.2).

Productive projects: need for greater rigor and more up-front analysis for more complex projects.Initially, it was expected that the project would support relatively small and simple investment projects,with a focus on the social sectors. When the Consortium decided to support the development of morecomplex agro-industrial projects which involved producers in more than one municipality, it did notinitially recognize that the development of such projects required a somewhat different process and level ofattention than the smaller projects. However, the Consortium learned that more complex productiveprojects such as palm oil, with higher technical requirements, investment cost and risk, required in-depthand complete feasibility studies prior to embarking on the investment phase. In addition, the Consortiumneeded to establish clearer criteria for deciding which projects merit its support in the feasibility stage, andfor determining its role in supporting those projects at the investment stage.

Monitoring and Evaluation in support of continuous learning and empowerment of communities. Theproject experience gave a preliminary indication of the appropriateness of the basic concept of themonitoring, evaluation and learning system for a program like the PDPMM which aims at building socialcapital and is being carried out in a highly uncertain environment. However, it proved more challengingand time consuming than expected to implement the system due to tensions between the "technical" aspectsof the work (quarterly M&E reporting, development of baseline, design of questionnaires etc.) and the"pedagogical" aspects of the work related to promoting participatory M&E by communities. In hindsight,to operationalize a M&E system of this kind it is critical to:

* ensure that the M&E and learning system is the responsibility of the entire organization (Consortium inthis case) and woven into the regular business, by defining clearly the M&E responsibilities and rolesof each unit/group in the organizational structure;

* ensure that the design of the system is understood and endorsed by various units and staff in theorganization and that there is agreement on basic concepts and tools to be used; and

* monitoring, evaluation and learning should have been made an integral part of the PDPMM'sparticipatory methodology for developing municipal proposals and initiatives as it is a key tool forbuilding social capital and empowerment.

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Project evaluation by a reputable external entity is useful in a conflictive and insecure environment.The two external evaluations made a useful contribution to this project. While much of what the evaluatorconcluded built on or validated observations and findings of the Consortium's M&E unit and team, theexternal evaluation was extremely useful particularly because of the strains on the Consortium team due totheir heavy work load and stressful conditions in the region. The external evaluations provided a moreobjective perspective; offered a structured moment for the Consortium team, communities and donors toreflect on and assess how things were going; and provided donors and the Government with an independentevaluation of progress and achievements.

Sharing of lessons. The Consortium has not been able to fully document and disseminate the wealth ofaccomplishments and lessons of the PDPMM, due to the enormous pressures of every day work andconstant crises in the region, and the desire to move the PDPMM forward to generate more benefits. It isimportant for the Bank, DNP and the Consortium to explore more deeply, systematize and disseminate thelessons of this project which are valuable for others in Colombia and the development community at large.Non-written forms of documenting and communicating these lessons might capture more effectively therichness of the experience as the most notable achievements relate to the development of human and socialcapital. Resources for these activities should be included in the follow-up project.

Partnership: a new way of working. Each of the key financier's of the project--the Bank, DNP,ECOPETROL, and UNDP--indicated that they have learned to work in a different way both in terms oftheir respective institution, and in the relationship of their institution and team with the other partners in theproject. This new way of working was characterized by a shared objective (the PDPMM's long-term goalsand vision), complementarity of contributions, sharing of risks, and recognition and respect for the differentperspectives and objectives of each partner (including dimensions of each partner's work outside thepartnership). The result of the open attitude of each team and investment of time to build this partnershipwas a high degree of commitment and ownership of the project.

9. Partner Comments

(a) Borrower/implementing agency:A translated version of the Borrower's contribution is contained in Annex 8. The National PlanningDepartment indicated its letter of June 26, 2001 that it agrees with the report. The implementing agencyprepared a series of write-ups on various aspects of the project and lessons learned which are listed inAnnex 7. In his letter of June 25, 2001, the Director of the CDPMM provided the following comments onthe ICR report (translation):

"After having carefully analyzed the ICR, we would like to express to the World Bank our agreement withthe content of the report. We are pleased that the evaluation of implementation, in particular theperformance ratings, is very positive. We consider that this is the result of serious team work of thecitizens of the region, staff of the CDPMM, staff of DNP, Ecopetrol and UNDP, in which all learned andin which we had the support of an excellent group of professionals from the World Bank.

To complement the report, I would like to emphasize the following points:

* the importance of the project which in function of the lessons learned has motivated the initiation ofother experiences. In effect, with the support of several of the partners of this project (DNP andUNDP) and inspired by the methodologies of the PDPMM, 9 projects have been started in other partsof Colombia (Meta, Northeast Antioquia, Southwest Antioquia, North Santander, Cauca Valley,Cauca, Sierra Nevada de Santa Marta, Montes de Maria, and Uraba);

* the constitution of a highly valued team (CDPMM) with a great level of commitment, engagement,professionalism, and a willingness to assume the risks of working in the midst of the on-going conflict

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in the region while taking great care not to put at risk the lives of others involved in the program or thesocial sustainability of the process;

* the synergy achieved by the program in which diverse actors are participating, by overcomingtraditional obstacles for these kinds of actions. That is to say, the methodological approach facilitatedthe development of working arrangements at the local, regional and national levels which involveddiscussion, consultation and implementation of projects that resolve in practice problems linked tomarkets, central planning, political and cultural differences etc.

The ICR report is written in the spirit of the LIL, learning and innovation, and carefully reflects the richexperiences, increased capacities, achievements and weaknesses. The ICR is not simply a document forcompleting the project, it serves as a contribution to the new tasks we must undertake in the near future aswe embark on a new stage of this continuous learning process.

(b) Cofinanciers:

The project's key cofinanciers and partners are: (i) UJNDP which in addition to administering the projectfunds under a Cost-Sharing Project also provided parallel financing for the project; and (ii) ECOPETROLthe original sponsor of the PDPMM which provided the counterpart funding for the LIL on behalf of theGovernment of Colombia. Both prepared written inputs and participated in the ICR Workshop. UNDPindicated on June 22, 2001 that it did not have any comments on the report. The Director of ExternalRelations of ECOPETROL in her letter of June 26, 2001 indicates that (translation):

"We have analyzed the content of the document and the evaluation by the Bank team of the components ofthe PDPMM, in the context of the first LIL, and we are very satisfied with the report's scope, content andassessment of the project. We would like to give special emphasis to two points raised in the document: (i)the issue of the project's sustainability in the face of the armed conflict (last sentence of section 6.1 ofICR); and (ii) the focus of the project on paving the way for the next phase of the PDPMM."

Annex 9 includes ECOPETROL's contribution to the ICR.

(c) Other partners (NGOs/private sector):While other partnerships were formed during the project's implementation, the new partners' comments onthe ICR report have not been requested as their involvement was less direct than those cited above.

10. Additional Information

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Annex 1. Key Performance Indicators/Log Frame Matrix

Table 1. Outcome/Impact Indicators

INDICATOR ASSESSMENT SOURCEPerception of Strong confirmation in second external Two External Evaluation Reports (Feb. 28,beneficiaries and evaluation: perception of beneficiaries, and 2000; November 2000), CIDER,stakeholders that the others interested in and external to Universidad de los Andes. Fiveprogram, of which LIL PDPMIM is that it is functioning well and municipalities selected for intensive studyis second phase, is producing results; citizens and authorities based on criterion of diversity.*operating satisfactorily have high level recognition, satisfactionand that benefits are and acceptance of PDPMM.being realized.

No. of partnerships 42 agreements signed with other private Balance S&E LIL.**established and and public entities to develop and financeresources contributed. initiatives, resulting in cofinancing of

approximately US$4.1 million.Financial and human * Total of approximately US$6.7 million Balance S&E LIL.resources contributed during LIL to develop and implementby municipalities and initiatives/sub-projects, 38% was financedothers to support by the Consortium and 62% wassubprojects. cofmanced by other private and public

entities.* Cofinancing sources (by % of totalfinancing for initiatives) were: 23% byproducer associations/communities, 18%by public sector institutions(decentralized), 3% by municipalities, 1%by UNDP, and 9% by others includingseveral private companies, and NGOs. Inaddition, producers obtained credit tofinance the palm oil projects.

Social organization Far exceeded this goal. Two External Evaluation Reports.increased and * Extemal Evaluation documents (5 Balance S&E LIL.strengthened in a least municipalities studied) important though5 of the 29 varied achievements in each.municipalities * Creation of new organizations and

strengthening of others particularlynoteworthy in 4 of 8 sub-regions.

* See results below for citizens network.* The methodological approach included quantitative and qualitative methods of data gathering such as questionnaires,group and individual interviews with key informants involved in, related to, or affected by the project, and a thoroughreview of key documents.**The Consortium's M&E of the semi-annual plans included a system of self-evaluation by the unit chiefs and fieldstaff; and independent assessments in the quarterly M&E reports of the project's evolution in 10 municipalities and forspecific initiatives.

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Table 2. Output IndicatorsCOMPONENT/ INDICATOR ASSESSMENT SOURCEOUTPUTComponent 1.1 Budget implementation * Completion of project on Balance S&E LIL.Consortium Change rate vs. planned time. 5 Semi-Annual Plans.Agent * Progressive improvement

for each Plan, with increase inexpenditures from aroundUS$235,000 (abbreviated 1st plan),US$815,440 (2nd plan) to US$1.7million (5th plan).

Perception of Consortium Consortium staff and donors External Evaluationstaff and donors. recognize significant increase in Reports.

Consortium's capacity, and its Quarterly M&E reports.translation of learning into actions. Results of ICR Workshop.

Perception of beneficiaries, See impact indicators. Second Externalpartners (particularly * External Evaluations provide strong Evaluation Report.municipal authorities), and evidence of positive perceptions and Balance S&E LIL.general public in the results.region: knowledge and * Given socio-political realities of theopinion about program, region, the relations with andprogram's image, and perception of municipal authoritiesexamples of successes are varied.and/or failures.

Component 1.2 Size/composition of the * Network includes 23 nucleos Balance S&E LIL.Citizen's Network network. (operating), 1 organization similar to Second External

a nucleo, 146 organizations and a Evaluation.total of 8,625 persons involved and 8th Quarterly M&Ebenefiting from PDPMM. Report.* 60% of the most influential socialorganizations in the municipality arerepresented in the nucleo; nearly allsuch organizations have cooperativerelations with nucleo (Ext. Eval.).* Rapid expansion of network in 4 ofthe 5 municipalities (Ext.Eval.).* 10 networks of organizations withcommon interests formed of which 7are considered strong including:* network of community radios (14organizations in 14 municipalities,350 persons),* regional fisherman council (43organizations, 14 municipalities, 87representatives), and* cacao producers (3 organizations, 5municipalities, 100 members).

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Representation of network * In 22 municipalities, these Second Externalmembers in formal citizens participatory forums reactivated and Evaluation.forums (such as Municipal operating more effectively with Balance S&E LIL.Councils for Rural support of PDPMM. Mejoras Practicas.Development, Municipal * 16 of the 78 members of thePlanning Councils). Municipal Planning Councils in 5

municipalities studied are membersof nucleo; however, in onemunicipality there are none (Ext.Eval.).* Establishment of Regional PlanningSystem involving 25 municipalities(later expanded to 33 due to interestof other municipalities outsidePDPMM) with a board and operatingrules established; first Congress inMay 2000; and participation inNational Planning Conference June2000.* Consortium's assessment is thatvery significant gains in at least 2municipalities in terms of impact on_municipal plans and policy.

Nucleos established and . 23 of the 29 municipalities have Balance S&E LIL.functioning in majority of nucleos formed and operatingmunicipalities (number of regularly with core membership ofnucleos regularly operating 541 persons.with a nucleo plan). * all 24 nucleos (one later dissolved)

carried out at least one 6 month plan,9 carried out 2 plans, and 8 havedone 3; level of satisfaction withachievements under plans iscorrelated with no. carried out.* 23 monographs on municipalproposals prepared.* advances in formulating municipalproposals qualified as: 0 are veryadvanced stage (content convertedinto projects in municipaldevelopment plan); 7 municipalitiesare advanced (projects have beendefined in plan); 13 are somewhatadvanced (monograph prepared); and6 are not advanced (no monographprepared).

Documented lessons on See table below. Quarterly M&E reports.how to strengthen Mejoras practicas.community capacity in a Results of ICR Workshop.context of intense conflict.

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Component 2. % of sub-projects Total of 67 initiatives financed: Balance S&E LIL.Subprojects implemented with positive * 33 (49%) judged to have good Reports project unit.

results. prospects and be worth pursuing atend of LIL; account for 63% of totalfunding for subprojects (42% ofConsortium funding for subprojects).a 18 (27%) should be considered forcontinuation if certain conditions met(build capacity, identify funding,demonstrate feasability andsustainability, more TA, armedconflict); account for 31% of totalfunding for subprojects (47% ofConsortium funding for subprojects).* 16 (24%) with poor prospects forvarious reasons (poor technicalviability, conflicts in organization,armed conflict, or no longer apriority) of which 2 were cancelled;accounting for 5% of total fundingfor subprojects (11% of Consortiumfunding for subprojects.)

Findings concerning Documented in reports cited; see Mejoras praticas.effectiveness of strategies table below.and approaches in variousareas such as primaryhealth and basic education

_____________________ tested under the LIL. _ _

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Table 3. Effectiveness of Strategies and Approaches in Health and Education SectorsSector Quantitative Indicators Qualitative AssessmentHealth . Establishment of 17 user associations. In the context of a major reform in sector

* Formulation with community which had not been translated into action inDuring the period participation of 21 Basic Health Plans the region, the strategy focused on creatingSeptember 1998- (PAB) in 21 municipalities. an informed demand by citizens andNovember 1999, the * Identification and training of 61 communities for services, and a response byMinistry of Health community groups. service providers which increases coveragefinanced this sector * Creation of quality improvement teams and quality.strategy; during 2000, in hospitals in 21 municipalities.it was financed by the * Formulation of institutional Important achievements realized in areas:LIL. In addition at the development plans for 15 local social control over public health (PAB, localend of 1998, the hospitals. health plans), and health promotion andUNPF approved a * Training in tools to improve disease prevention initiatives. Efforts lessproject for management of 23 public health dynamic for hospital user associations andreproductive and providers (IPS). oversight of development plans.sexual health in the * Vision health program served 14,000region which was children reaching 80/ of the region's Building on achievements and practicalmanaged by the targt I experience during first year, as well asConsortium. taget population.fouestde t.n°rvgpblchahConsortium. * Networks created: citizen oversight of focused studies carried out in 2000, a

health sector (members in 12 regional strategy for improving public healthmunicipalities), and community was developed and presented in a documentmunicipalties), and community (July 2000) which will guide future actionsinitiatives for peaceful coexistence (10 of PDPMM.women and youth groups concerned

with family violence). . Important progress in promoting greater* Sexual and reproductive health project: participation in nucleos of citizens and

groups concerned with these issues organizations concemed with healthformed and trained in 20 ( . .municipalities, and training of 31 1 .doctors and 225 health workers,trainers and community leaders.

Education * Promotion of Integrated Basic Schools Major reforms in the education sector giving(IBS) concept with an important and a more important role and responsibilities tointense process of support in 3 rural municipalities and educational institutionsmunicipalities results in creation of 8 had been adopted at the national level but notworking groups, training of 300 translated into action in the region. Inteachers, and 3 projects in various addition, the PDPMM conceives ofstages of development (see below). education in a very broad sense and as a

* Municipality of El Carmen: force for social development in the region.Institutional Education Plans (PEI)prepared for its 77 rural schools; 410 Outstanding achievements in El Carmen withpersons including teachers, parents and the teachers coming together with the rest ofstudents develop new curriculum for the community, and using the schools andthe IBS, contributing to the definition focus on education as focus for dynamizingof a Municipal Education Plan which broader development actions in thewas adopted by municipal authorities. municipality such as the cacao project. Clear

* Expansion of education coverage in impact on municipal development plan.rural areas of 2 municipalities: 150students (6th-7.th grade) Landazuri, and Construction with the communities of an600 students (6 h_,1 Ith grade) El educational method of learning by doing,Carmen, with 79 graduates with instead of classic classroom training"bachilleres" in 2001. methods, which can be used in many other

areas for development of the community.

Source: Las Mejores Priticas del Programa de Desarrollo y Paz durante la primera fase PAI, Febrero 2001.

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Annex 2. Project Costs and Financing

Project Cost by Component (in US$ million equivalent)Appraisal ActuallLatest Percentage ofEstimate Estimate Appraisal

Project Cost By Component US$ million US$ million l

1. Capacity Building for Program Management1.1 C onsortium as Change Agent and Program Manager 2.62 4.11 1571.2 Citizen's Network 0.50 0.70 140.2. Sub-Projects2.1 Technical Assistance for Sub-Project Preparation 0.50 1.02 2042.2 Sub-Projects 2.25 5.65 251PPF Refinancing 0.38 0.40 105

Total Baseline Cost 6.25 11.88

Total Project Costs 6.25 11.88__Total Financing Required 6.25 11.88 __

Project Costs by Procurement Arrangements (A raisal Estimate) (US$ million equivalent)j: Procurement Method I

Expenditure Category ICB NCB Other N.B.F. Total Cost

1. Works 0.00 0.00 0.00 0.00 0.002. Goo(0.0ds) (0.00) --- 0.00) (0.00) (0.00)

2. Goods 0.00 0.00 0.05 0.00 0.05(0.00) (0.00) (0.05) (0.00) (0.05)

3. Services 0.00 0.00 2.84 0.00 2.84(0.00) (0.00) (2.84) (0.00) (2.84)

4. Miscellaneous: 0.00 0.00 1.90 I 0.00 1.90Transfers for Nucleo Plansand Sub-ProjectsI______________________ Z (0.00) (0.00) (0.90) (0.00) (10.90)5. Miscellaneous: 0.00 I 0.00 0.83 0.00 0.83Operating Costs (0.00) (0.00) (0.83) (0.00) (0.83)6. PPF Repayment 0.00 0.00 0.38 0.00 0.38____________________ l (0.00) (0.00) (0.38) (0.00) (0.38)

Total 0.00 0.00 6.00 0.00 6.00(0.00) j (0.00) (5.00) (0.00) (5.00)

See explanation of footnotes 1 and 2 below in next table. Additional note: This table only includes the loan andcounterpart funds.

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Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ million equivalent)

Procurement MethodExpenditure Category ICB NCBe thr N.B.F. Total Cost

1. Works 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

2. Goods 0.00 0.00 0.07 0.00 0.07

(0.00) (0.00) (0.00) (0.05)3. Services 0.00 0.00 2.47 0.00 2.47

(0.00) (0.00) (2.07) (0.00) (2.07)4. Miscellaneous: 0.00 0.00 1.84 0.00 1.84Transfers for Nucleo Plansand Sub-Projects

(0.00) (0.00) (1.50) (0.00) (1.50)5. Miscellaneous: 0.00 0.00 1.23 0.00 1.23Operating Costs (0.00) (0.00) (0.99) (0.00) (0.99)6. PPF Repayment 0.00 0.00 0.39 0.00 0.39

(0.00) (0.00) (0.39) (0.00) (0.39)Total 0.00 0.00 6.00 0.00 6.00

(0.00) (0.00) (5.00) (0.00) (5.00)Additional note: This table only includes the loan and counterpart funds.

Figures in parenthesis are the amnounts to be financed by the Bank Loan. All costs include contingencies.

Applicable "Other" Procurement Methods specified in loan agreement for this project are: Expenditure Category 2Goods-Shopping procedures; Consultant Services-Category 2 in accord with Consultant Guidelines; and Category4-Transfers in accord with procedures in Operating Manual.

Project Financing by Component (in US$ million equivalent)Percentage of Appraisal

Component Appraisal Estimate Actual/Latest EstimateBank Govt. CoF. Bank Govt. CoF. Bank Govt. CoF.

1. Capacity Building forProgram Management1.1 Consortium as Change 2.32 0.30 2.75 0.83 0.53 118.5 276.7Agent and ProgramManager1.2 Citizen's Network 0.30 0.20 0.32 0.12 0.26 106.7 60.0Sub-Total 2.62 0.50 3.07 0.95 0.79 117.2 190.02. Sub-Projects2.1 Technical Assistance 0.25 0.25 0.18 0.29 0.54 72.0 116.0for Sub-ProjectPreparation2.2 Sub-Projects 1.75 0.50 1.35 0.70 3.60 77.1 140.0Sub-Total 2.00 0.75 1.53 0.99 4.14 76.5 132.0PPF Refinancing 0.38 0.00 0.40 0.00 0.00 105.3 0.0TOTAL 5.00 1.25 5.00 li.95 4.93 100.0 156.0

This table includes additional funds raised during the course of the project amounting to US$4.93 million whichwere impossible to estimate at appraisal. Most was for cofinancing of sub-projects by diverse sources includingcomrnunities, municipal and departmental governments, central government agencies, the private sector etc.Excluded is credit obtained by producer organizations.

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Annex 3. Economic Costs and Benefits

Not applicable for this LIL.

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Annex 4. Bank Inputs

(a) Missions:Stage of Project Cycle No. of Persons and Specialty Performance Rating

(e.g. 2 Economists, I FMS, etc) - Imlementation DevelopmentMonth/Year Count Specialty Progress Ojective

Identificatfon/PreparationAugust 1996 6 Agricultural Economist

Lawyer (Res Rep, CO)NGO/Social developmentspecialist (CO)Infrastructure specialist (CO)Social sector specialist (CO)Sociologist

January 1997 9 Agricultural EconomistLawyer (Res Rep, CO)NGO/Social developmentspecialist (CO)Infrastructure specialist (CO)Social sectors specialist (CO)Livestock specialist2 SociologistsAgronomist

April 1997 1 Sociologist/M&E ExpertMay 1997 5 Lawyer (Res Rep, CO)

NGO/Social developmentspecialist (CO)Infrastructure specialist (CO)Social sectors specialist (CO)Livestock specialist

September/1997 5 Agricultural EconomistSociologist/M&E ExpertLawyer (CO)NGO/social developmentspecialist (CO)Infrastructure specialist (CO)Social sectors specialist (CO)Project Officer (CO)

October 1997 5 Agricultural EconomistNGO/Social developmentspecialist (CO)Infrastructure specialist (CO)Social sectors specialist (CO)Project Officer (CO)

November 1997 1 Sociologist/M&E ExpertDecember 1997 1 Agricultural Economist

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Appraisal/NegotiationMarch 1998 7 Agricultural Economist

Financial Mgt SpecialistProcurement AnalystNGO/Social developmentspecialist (CO)Infrastructure specialist (CO)Social sectors specialist (CO)Project Officer (CO)

SupervisionJanuary 1999 2 Natural Res. Mgt. specialist S S

(CO)Livestock Expert

May 1999 2 Sociologist/M&E Expert S SNGO/Social developmentspecialist (CO)

April/May 1999 1 Project officer/rural dev (CO) S SJune 1999 1 Financial Mgt Specialist S SJuly 1999 2 Economist/MBA S S

Project officer/rural dev (CO)September 1999 2 Economist/MBA S S

Project officer/rural dev (CO)November 1999 2 Economist/MBA S S

Project officer/rural dev (CO)January 2000 2 Economist/MBA S S

Project officer/rural dev (CO)March 2000 8 Agricultural Economist HS S

NGO/ Social developmentspecialist (CO)Economist/MBAInfrastructure specialist (CO)Social sectors specialist (CO)Project Officer/rural dev (CO)Natural Res. Mgt. (CO)

October 2000 4 Agricultural Economist HS SEconomist/MBAProject Officer/rural dev (CO)NGO/ Social developmentspecialist (CO)

ICRDecember 2000 5 Agricultural Economist HS S

NGO/Social developmentspecialist (CO)Project Officer/rural dev(CO)Sociologist/M&E expertOperations-New LendingInstnunents specialist

The project team was primarily composed of staff from the Colombia office (CO).

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Project supervision was characterized by regular contacts with the Consortium and a high involvement of staffbased in Colombia.

(b) Staff:

Stage of Project Cycle Actual/Latest EstimateNo. Staff weeks US$ ('000)

Identification/Preparation 66.0 167.9Appraisal/Negotiation 16.0 47.5Supervision 62.0 167.5ICR 12.0 39.0Total 156.0 421.9

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Annex 5. Ratings for Achievement of Objectives/Outputs of Components

(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)Rating

D Macro policies O H OSUOM O N * NAC Sector Policies O H OSUOM O N * NA0Physical OH OSUOM ON *NA0 Financial O H OSUOM O N * NAO Institutional Development 0 H * SU O M 0 N 0 NAO Environmental O H OSUOM O N * NA

SocialO Poverty Reduction O H OSUOM O N O NAEl Gender OH OSUOM ON ONAM Other (Please specify) * H OSUOM O N O NASocial CapitaUCommunity Driven

DevelopmentO Private sector development 0 H O SU O M 0 N 0 NA0] Public sector management 0 H O SU O M 0 N 0 NAE Other (Please specify) * H OSUOM O N O NALearning Objectives

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Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performance Rating

B Lending *HS OS OU OHUI Supervision *HS OS OU OHU

• Overall OHS OS O U O HU

6.2 Borrowerperformance Rating

X Preparation OHS OS O U O HUI Government implementation performance * HS O S 0 U 0 HU

Z Implementation agency performance O HS O S 0 U 0 HU1 Overall OHS OS O U O HU

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Annex 7. List of Supporting Documents

Centro Interdisciplinario de Estudios Regionales (CIDER), Universidad de los Andes, Evaluaci6nIntermedia Extema Programa de Desarrollo y Paz del Magdalena Medio," 2 volumes, February 28, 2000.

Centro Interdisciplinario de Estudios Regionales (CIDER), Universidad de los Andes, "Segunda Fase de laEvaluaci6n Intermedia Extema," 3 volumes, November 2000.

Consorcio Desarrollo y Paz del Magdalena Medio, Equipo S&E, "Octavo Informe Trimestral" (8thQuarterly M&E Report), Periodo Enero-Junio de 2000.

Consorcio Desarrollo y Paz del Magdalena Medio, Equipo de S&E, "La Construcci6n de un Sistema deSeguimiento, Evaluacion y Aprendizaje," November 2000.

Consorcio Desarrollo y Paz del Magdalena Medio, 0. Gutierrez Lemus, "Balance General Seguimiento yEvaluaci6n Etapa de Aprendizaje e Innovaci6n LIL 1998-2000," February 2001.

Consorcio Desarrollo y Paz del Magdalena Medio, "Las Mejores Practicas del Programa de Desarrollo yPaz Durante la Primera Fase PAI," February 2001.

Consorcio Desarrollo y Paz del Magdalena Medio, Unidad de Proyectos, "Informe Final de Iniciativas,"February 2001.

Robert H. Schaffer, "Beginning with results: the key to success," The Journal for Ouality and Participation; September 1997.

Robert H. Schaffer and Harvey A. Thomson, "Successful Change Programs Begin with Results," HarvardBusiness Review. January-February 1992.

World Bank, Lina Maria Garcia, "El Programa de Desarrollo y Paz del Magdalena Medio: Elementosconstitutivos para la elaboraci6n de una propuesta en otras regiones," November 2000.

World Bank, Arturo Garcia Duran, Ivan Dario Chain, and Jose Nelson Camelo, "Notas de una Viaje: LaAventura del Programa de Desarrollo y Paz del Magdalana Medio, vista desde algunas de sus initiativasproductivas," November 2000.

World Bank, E. Garfield, Back-to-Office Report on ICR Mission dated December 14, 2000 withAttachment 1 "Aide Memoire Misi6n de Terminaci6n del Proyecto" and Attachment 2 "Memorias delTaller de Evaluacion de Aprendizajes-Proyecto de Desarrollo Regional del Magdalena Medio (Prestamo4371-CO)."

World Bank, A. Rudqvist, Back-to-Office Report on ICR Mission-Monitoring and Evaluation Systemdated December 17, 2001.

World Bank, L. Sontheimer (OCKOS), Back to Office Report on LIL ICR Mission dated January 1, 2001.

World Bank, Anders Rudqvist, "Monitoring and Evaluation in the Context of Learning and Innovation,Magdalena Medio Regional Development Project in Colombia," February 2001.

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Additional Annex 8. Borrower's Contribution to the ICR

Presented by the National Planning Department(translated from Spanish)

1. Introduction

The Magdalena Medio Development and Peace Program (PDPMM), funded during the 1998 - 2000period through a Learning and Innovation Loan (LIL) from the World Bank to the Nation, has operatedwith a novel plan through which various entities have participated by contributing their technical andfinancial resources to start up a social process of regional development and peaceful co-existence in theMagdalena Medio region. In this arrangement, the National Planning Department (DNP), is theinstitution responsible for the loan that the Nation has taken out; the Consortium for Development andPeace Magdalena Medio (CDPMM), made up of the association between the Catholic Diocese ofBarrancabermeja and the Center for Research and Popular Education (CINEP), is the regional body towhom DNP delegated the implementation of the Project; ECOPETROL is the State agency that assumedthe financial commitment for the Nation to provide counterpart funds; and the United NationsDevelopment Program (UNDP) is the organization responsible for management of the project funds.

For the DNP, in reality this Program summarizes in merely one experience the elements that, in theNational Development Plan, the Government has considered elements which make it possible to generateconditions of peaceful co-existence in the process of building real conditions for peace:

§ Promotion of Strategic Alliances: This Program exemplifies the strategic alliance approach inwhich, upon reaching a consensus on an objective, different actors such as the civil society, the Church,and the Government are convened. Under this scheme, the State is involved as merely one of several actorswithin the whole process; it plays the role of facilitator among this broader group of actors in which thefunctions of using and managing the project resources, and implementing the strategy is delegated to otherorganizations. Moreover, through productive initiatives that become investment projects, the PDPMM infact encourages making alliances that involve all of the sectors that form part of the production chain.

§ Strengthening social capital is an indispensable requirement for creating conditions for peace inthe regions, and that is precisely what the PDPMM has been promoting. The Consortium is an entity thatgenerates trust both through putting resources to work, and through creating spaces for interchange ofresources, knowledge, capacity building and other support to communities. Along the same lines, thepromotion of spaces for community participation and the effort made to involve the communities in issuesrelating to municipal planning are fundamental elements for achieving real institutional development, andthus building social capital.

§ Decentralization. From the point of view of decentralization which is a Government priority, thisProgram is an example of civilian society's participation in public management, because the way theprogram is carried out promotes strengthening the effective power of citizens and the sharing ofresponsibility with public and private entities for social, economic, and environmental development. Inaddition, the PDPMM exemplifies the efficient management of public resources by a regional organizationmade up of a consortium of non-public entities that assume responsibility for building responsive publicinstitutions and civic values in the region (lo publico), by helping citizens change their attitude towards thepublic sector to one of actors whose activities contribute to the common good and who are responsible forrebuilding the social fabric, based on trust in and cooperation with the public administration.

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2. Institutional Aspects

The National Technical Committee is responsible for coordinating the entities involved in theimplementation of the project (the Consortium, DNP, UTNDP and ECOPETROL) and for orienting andoverseeing the project's implementation in accord with the project's guidelines and methodology. It meetstwice a year to evaluate the project's performance based on monitoring and evaluation reports, externalaudits, the external evaluation reports, and regular field visits made by the DNP. In addition, theCommittee discusses and approves the semi-annual plans submitted by the Consortium which served as abudgeting and planning tool which took into account the particular difficulties of the regional context.

In regard to the project and PDPMM, DNP has played a technical role as well as a broader strategic roleregarding policy-making, as described below.

(i) Regarding technical support, as representative of the Borrower, the DNP has processed with theMinistry of Finance the project disbursement requests based on the submission by the Consortium andUNDP of justification for expenses made, in order to ensure permanent liquidity of funds for the Project.In this regard, DNP has worked in constant coordination with the Consortium, verifying the Projectexpense statements and implementation performance. Because this is a Project agreement in which variousentities participate, many formalities and steps are required to process disbursements, and that has meantconstant coordination between the Consortium and the DNP.

As can be expected, we have had to overcome some difficulties in coordination especially between thetechnical unit and the unit in charge of budget inside the DNP, and among those same two units and thesystems unit of the Ministry of Finance, and also the different units in the World Bank. In spite of all ofthis, upon ending this Project, we can say that communications and information problems, which at firstcaused delay in processing steps, have been overcome. However, for the follow-up project, we need tocreate an even more effective strategy for circulating information.

The DNP has participated more actively than just supervising the performance reports in the meetings ofthe National Technical Committee. Its participation in the meetings of the Consortium's SteeringCommittee (Equipo de Conduccion) in Barrancabermeja has enabled DNP to follow more closely theevolution of the Project, facilitating a better understanding of the complex process in the region. Theinitiative to involve the project's partners in field visits is a good way to materialize the commnitment ofthese entities to use a common language and to give them the possibility of creating synergy to act andmake decisions together when faced with situations that require a timely reaction.

(ii) Regarding policy-making, the DNP's relation with the process resulting from the Program in the regionhas had a much greater scope than the one initially contemplated. The National Development Planacknowledges the PDPMM as an experience that contributes some lessons for policy-making in the area ofregional peaceful co-existence experiences and in the area of regional development in the midst of conflict.Thus, within the priority area of building conditions for peace, priority is given to programs and projectsthat are born from regional initiatives that count on the broad participation of the civilian society and whosemain objectives are rebuilding the weakened social fabric in conflict zones, strengthening local and regionalinstitutions proposed by the communities, and obtaining the consensus of various sectors on some minimumset of collective objectives. In addition, based on the PDPMM experience, priority would be given toimplementation strategies in which alliances are made among the public sector, the Church, and NGOs,depending on their representativeness and on the particular conditions of each region.

In addition, DNP has worked on making the productive projects identified in the Program and by the

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communities viable and presented them to donor meetings of representatives of the international communitywho are interesting in supporting the peace process in Colombia. Thus, thanks to the prior work ofcoordinating the identification and start-up of these projects in the region, the Government has given thempriority for funding with resources from the Fund for Investments in Peace; the Consortium is theimplementing agency in the best position to serve as mediator between the Central Government, theorganizations, and the local governments.

3. Meeting Objectives

From DNP's perspective, the process initiated in this learning and innovation phase of the PDPMM hasbeen correctly focused on meeting the objectives agreed upon when the Project was being formulated. Wemust keep in mind that this project follows the logic of generating learning and that the broader programobjectives with broad regional coverage are seen as a ten year endeavor. In this sense, the PDPMM hasgenerated more learning than what was initially foreseen, because the behavior of the Project in the fieldhas been widely accepted by the communities and the organizations which in the region's conflictiveenvironment has been a fundamental aspect for ensuring its viability. Based on this fact, it has becomeevident that the PDPMM has been able to develop an innovative strategy and methodology that haveenabled it to maintain its autonomy and legitimacy in the scenario of conflict that pervades this region.

So, if we take into account the main objective "Develop the operational capacity of the Consortium, of theCitizen's Network, and of other partners to work together towards jointly defined objectives, seeking toreduce poverty and increase peaceful co-existence in the Magdalena Medio region", then we have met theobjective, from the perspective of the real capacity that the Consortium has acquired as an entity thatmanages the PDPMM and empowers the communities. The start-up of projects that are productive, that areeducation- and health-oriented, that can co-exist successfully in some municipalities and communitiesindicates that each process perceived as "successful" must be documented, so that its methodology can beused in the second phase of the process to expand the scope and achieve more widespread impacts.

Furthermore, for the DNP it is clear that the Consortium's capacity to manage resources transparently andefficiently has been more than proven during the two years that the Project has been in operation, because itwas able to use all of the loan resources in the allotted timeframe (see Chart #1). In addition, theConsortium has been able to mobilize additional resources for the region in an amount similar to theamount mobilized by the Learning and Innovation Project. A demonstration of confidence in thetransparent management of the resources by the organizations in the region occurred in 1998 when theGovernment and rural leaders signed the agreements that ended the peasant exodus, during which theGovernment committed to fund the creation of an integrated plan for the S. Bolivar region. There wasmutual agreement to let the Consortium manage the resources.

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Chartl

Eecucion Programa de Desarrollo y Paz deMagdalena Medlo

:: X

Source: Official documents confirming disbursements against resources authenticated by theIBRD.As to developing the Citizen's Network, we need to continue learning because, even though in somemunicipalities there is a nucleo of inhabitants that is representative and has generated planning processeswhich are contributing to citizenry and participation in the municipality, in other rnunicipalities the processis barely beginning and there is much to be done.

For DNP as well as for the other partners in this process, it is clear that the proof of the Consortium'stransfer of its capacity to the region must be expressed in municipal life i.e. the active presence andparticipation of the communities that make up the civil society who exercise their role as citizens in themunicipal scenario. Using that measuring stick, although we acknowledge that important progress has beenmade in this field, it is clear that much learning is still needed to convene groups and build up civic life (lopublico) in municipal scenarios and especially in those where the presence of conflict and the resultingpolarization reduces the inhabitants' capacity to exercise their role as citizens and willingness to becomeinvolved in the municipality as the arena for attending to collective interests.

I# of Initiatives/ Ongoing Sub-Projects I 62# of Operating Nuclei of Inhabitants 23

Lessons Learned

Territoriality / Integrality

One of the advantages that the PDPMM has, as compared to other intervention strategies or programspromoted by the Central Government, is that this is a process conceived and implemented from the regionitself by a group of legitimate actors to lead a process of social mobilization and construction. When thelearning and innovation stage started up, ample work in participatory diagnosis and analysis had alreadybeen done which meant that the inhabitants already had good knowledge of the Program. But even moreimportantly, the Program that is being created is the result of what was discussed and gathered fromconsulting with the communities. That is why, the components, strategies, objectives, and tools are theresult of a phase of consensus-building with many of the inhabitants in the region. Therefore, the Program

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is not perceived as something alien to the organizations, but rather as something that was based on theirreality and in which they were involved.

On this point, we also wish to highlight how important it is that those who led the implementation of thisprocess should be leaders who have previously worked on this type of project and who have a good trackrecord with the social organizations in the region.

Moreover, the PDPMM considers the problem of sustainable human development and of building publicawareness/civic values from an integrated, holistic point of view in which both during the diagnostic stageand the implementation, the transversal nature and not the sectoral nature of development is considered.That is why the Program promotes and encourages reflection in the communities with an integratedperspective of how the inhabitants perceive their reality, discouraging lists of investment projects andmotivating a broader reflection regarding "processes" among the communities.

Flexibility of the Implementing Organization / Transitory Nature

One of the most significant things that the DNP has learned is that promoting regional development andbuilding conditions for peace in a region may be led by a regional entity using public funds. Thisarrangement permits great flexibility for both effective resource management and a more fluid interlocutionwith communities. The Consortium's work is a good example of this. Not only was the program created inthe region, but also the inhabitants feel that they are working with an entity that they do not identify asantagonistic or easily stigmatized by some of the parties to the conflict.

This organization expresses its flexibility by incorporating into its planning the results of theself-evaluation that the Consortium constantly makes and this enables it to reformulate its actions andrestructure itself based on the requirements of the processes and projects in the region. That is how we haveclearly gone from a centralized strategy in which decisions are made in Barrancabermeja to a strategy thatallows more decentralization and more participation by the sub-regional actors and leaders indecision-making, with a more territorial and complete vision. The Consortium operates with a horizontaldecision-making strategy that enables the communities' concerns regarding the everyday workings of theprojects to become issues that are incorporated into the planning and the direction of the Program'simplementation in the field.

We also see flexibility in the Consortium's work to accompany communities in the development process.This task is carried out based on the communities reality and on their degree of organization. In thismanner, initiatives are born based on the actual capabilities of the organizations and the share of resourcesset aside for these initiatives adjusts to this fact.

4. Evaluation of Bank's Performance

Project Preparation Stage:

During the Project preparation stage, the Bank's role was important as it illustrated other Learning andInnovation Project experiences that had been implemented in other parts of the world. The Bank transferredits knowledge of the lessons learned in other experiences and this provided enough material to evaluate therelevancy of choosing the Learning and Innovation Loan (LIL) mode. As of the preparation stage, with theBank team, the implementing agency and the Consortium, created a joint work team with a permanent andcollective work style.

Project Supervision Stage:The Bank constantly supervised the Project, periodically emphasizing the sectors and issues that arerelevant, such as Education, Health, Economy, Monitoring, and Evaluation, etc. Along these lines, thissupervision made important contributions to the implementation of the Program and at the same time

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broadened the knowledge that the Bank officials had of the Program. Some of the Bank officials'supervision visits were made directly in the field and there we had proof that this kind of direct follow-upwith the communities that benefit from the Program definitely improves the perception that the officialshave of the Program compared to when they only read documents. That is why it is important to emphasizethe relevancy and effectiveness of the supervision that the Bank does directly in the field.

The Bank's Overall Performance:

The Bank performed positively during the development of the whole operation. From a technical point ofview, we were able to make up a work team with the participation of all of the partners and Bank officialsin an atmosphere of trust and of permanent building, in the general spirit of learning that the Project alwayshas had. Since this is a learning and innovation process, it would be fruitful for the Bank to continueadopting norms and administration mechanisms that are increasingly flexible, for a project with thesecharacteristics.

5. Evaluation of Borrower's Performance

Implementation:

From the point of view of the Government's project implementation strategy, this Project was considered apriority, given the importance of this Program in building an experience that can be replicated to generatefavorable conditions for peace in this region and in others that have high levels of conflict. That is why, theNational Development Plan incorporates the criteria and the progress made while preparing the learningand innovation phase of the Magdalena Medio Development and Peace Program.

Borrower's Overall Performance:The National Planning Department's performance as the party responsible to the Nation for the loan waspositive, taking into account that the Learning and Innovation mode was new for our country and for thisagency. The execution of the loan was delegated to the Consortium for Development and Peace MagdalenaMedio who performed positively within the framework of the Learning and Innovation (LIL) Project,acquiring a growing capacity both administratively and technically to develop the Project in the MagdalenaMedio territory. The coordination between DNP and the CDPMM of the project's implementation wasdone using a work strategy of permanent communication and of collaborative work; this made it possible tocarry out the work required for processing disbursements with the Ministry of Finance and with the Bank ina timely fashion most of the time.

Perfornance of the Partners Who Participated in Project Implementation and Execution:The United Nations Development Program played a role that went beyond resource management. Thisorganization contributed added value to the Project by being present in the region; it installed an office inBarrancabermeja. Moreover, it contributed resources to the Project that represented an additional 15% tothe loan resources and this helping make some of the sub-projects in the field a reality. The UNDPcontribution was very significant in a region with a high degree of armed conflict such as this one. Workingjointly with this United Nations agency gave the Project support and a sense of neutrality as far as thearmed actors are concerned.

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Additional Annex 9. ECOPETROL's Contribution to the ICR

Lessons Learned by ECOPETROL regarding the LIL-PDPMM

This learning relates to the achievements obtained by the PDPMM which largely corroborate the resultsexpected from the hypotheses proposed for the general objectives of the LIL. Assessment of the project has ledECOPETROL to propose, for the second phase, the need to disseminate this learning among ECOPETROL'sdirectors and operating units in all areas of influence, as well as the need to transfer the methodology to themanagement and policies for the company's external relations.

Analyzing the hypotheses and achievements of the PDPMM-LIL, the lessons learned were as follows:

HYPOTHESIS-THE CONSORTIUM AS CHANGE AGENT: A CHANGE AGENT ACTING AS ACATALYST, UNDERSTOOD AS A PROMOTER, MANAGER OF PARTNERSHIPS, PROVIDER OFTECHNICAL ASSISTANCE WHO SELECTIVELY PARTICIPATES IN THE FINANCING OFINITIATIVES, HAS A GREATER IMPACT ON PARTICIPATORY DEVELOPMENT PROCESSESTHAN DOES AN AGENT THAT MERELY EXECUTES PROGRAMS.

ACHIEVEMENT. Greater regional management capacity of both the Consorcio de Desarrollo y Paz delMagdalena Medio and the citizens network. The achievement in this area is considered to be HIGH and thefollowing impact assessment has been offered:

* Greater number of citizens and community organizations mobilized around program objectives aswell as planning and executing development initiatives. The program has worked with communitiesbased on their expectations and interests, and has defined collectively 83 initiatives which seek to reducepoverty and increase peaceffil coexistence. It has also raised the credibility of the program and its possibleresults among the communities.

* More public and private entities are committed to the region. This is reflected in the participation ofgovernment agencies and programs (National Planning Council, the ministries of defense, mines andenergy, and the interior, the National Planning Department, Plan Colombia, Incora, Plante, Finagro,Ferrovias, Banco Agrario); as well as that of private entities (Coca-Cola, Compafiia Nacional deChocolates, National Federation of Coffee Growers, palm oil companies, palm grower associations, the "Antioquia Syndicate," Diocese of Sons6n, ISA, Medellin Public Utility Companies), universities, volunteertechnical personnel from ECOPETROL, and international agencies (UNDP, CEPAL, United StatesEmbassy, British Embassy).

* More public and private funding for the program. The program has been able to generate 2.5 times theresources it started out with, as the current amount invested reaches 27 billion pesos.

* General acceptance of the Consortium by all actors. With some exceptions, in general terms the leadersof the arned parties or those outside the law respect the initiatives, the communities participating in theprojects, the projects themselves, and some have committed to facilitating the development of the program.

The origin of this result and its achievement represents for ECOPETROL a learning experience forregarding the following:(1) Recognition of the program as a mechanism useful in: facilitating the participation of a greater number ofcitizens in leadership and regional development processes, accompaniment and participation by other

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institutions, construction of shared objectives, channeling of international cooperation resources, supplementingand accompanying regional development programs, identifying the real- problems communities have and theirability to propose their own initiatives and/or development projects to improve their quality of life, makingtechnology and knowledge available to the communities for their development;(2) Acknowledgment of new methodologies and new ways of relating, understanding and working withcommunities, and (3) Recognition of the capacity of the community to become involved in a positive manner inthe formulation of alternatives for its own development.

Based on this experience, in the immediate future ECOPETROL may implement new ways of:(1) Accompanying the formulation and development of regional programs;(2) Building common objectives with the surrounding environment;(3) Facilitating participation by a greater number of citizens in leadership and regional development processesand leveraging and generating resources;(4) Channeling international cooperation resources towards the regions;(5) Seeking the accompaniment and synergy with other institutions;(6) Facilitating the participation of ECOPETROL's workers (with the support of Equipo de Conduccion delCDPMM), in providing assistance to development projects and programs focused on overcoming poverty andimproving the quality of life of inhabitants in their areas of influence, as part of the fulfillment of the theirsocial responsibility;(7) Implementing this methodology through formal participation mechanisms, thus making it possible for thecommunity to develop improved leadership skills, increase its participation in the construction of the region andgenerate a propositional comnnunity culture;(8) Further involving community participation, not only in terms of submitting proposals for projects but alsoregarding prior stages (initiatives and maturation) pursued by the program on the basis of the step by stepmethodology.

HYPOTHESIS-THE CITIZEN'S NETWORK AS THE BASIS FOR PROGRAM'SPARTICIPATORY PLANNING AND AS A VEHICLE FOR INTERNAL COMMUNICATIONBETWEEN INHABITANTS: THE CREATION AND THE ACTIVITIES OF THE CITIZEN'SNETWORK BECOMES THE PRINCIPAL INSTRUMENT USED TO STRENGTHEN CIVIL SOCIETYAND PROMOTE CLOSER TIES BETWEEN IT AND INSTITUTIONS, THEREBY INCREASING THEINFLUENCE OF CITIZENS IN PUBLIC AFFAIRS.

This increase is reflected in the following:

* Greater number of individuals, grassroots and non-governmental organizations and/or informalgroups linked to the nucleos. More than 1,000 inhabitants participate in the nucleos in 26 municipalities.The young, women, men, peasant associations, shopkeepers, bakers, fishermen, potters, miners, coffeegrowers, milk producers, sugar cane and rice growers, lumber producers, and educational communityorganizations participate in the formulation of initiatives, and over 10,000 individuals will participate intraining programs.

* Greater influence by organized citizens on public affairs. Among all initiatives currently underway,45% (38 of 83) are related to: the construction of public life (15), education (7) and fishing and theenvironment (19).

* The planning system is strengthened by means of citizen participation. All initiatives are collectivelycreated. Advice and accompaniment have been provided for the process of formulating, discussing andapproving of municipal land use plans, emphasizing participatory construction. Local planning councils

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have been strengthened, ensuring citizen participation in the POT (Plan de Ordenamiento Territorial - LandUse Plans) and the community participates in monitoring development plans.

* Greater flow and use of public and private resources. The resources sought and approved fordevelopment of initiatives (sub-projects) jointly with public, private and international cooperationinstitutions reach 27.4 billion pesos.

* Respect for the PDPMM by the parties in conflict. The defense of the right to life and the gains madeconcerning work conducted by and for the poorest inhabitants of the region have led the CDPMM staff andcommunity members who are participating in the initiatives to be viewed with respect in the majority ofcases, except for instances where statements made regarding the different armed players have failed tomaintain a balance.

* Greater satisfaction and optimism on the part of citizens. Empowerment of the community by way ofits initiatives, which become life projects and which have allowed them to shift from neutrality towardsautonomy vis-a-vis the armed players.

* Greater trust among alliance partners.

HYPOTHESIS-ON THE CITIZEN'S NETWORK AS AGENT IN CHARGE OF IMPLEMENTINGINITIATIVES: A DEVELOPMENT PROGRAM BASED ON LOCAL INITIATIVES WITH A HIGHDEGREE OF PARTICIPATION BY ORGANIZED CITIZENS STRENGTHENS THE SKILLS OF THECITIZENS AND PROMOTES THE GROWTH OF SOCIAL CAPITAL.

ACHIEVEMENT. Increase in the number of economic and social initiatives directed by the inhabitants. Thisis rated as HIGH and the impact has been assessed according to the following elements described below.

The program has facilitated dissemination of information in the communities for the development of eachinitiative. It has also worked on the technical dimensions of the initiatives and work of the nucleos, in additionto strengthening the capacity to accomplish the following:i Identify and formulate new productive projects that generate employment not only in the oil-related sector

but also in other sectors of the economy as well.* Identify and initiate development of new businesses.* Acknowledge deficiencies in capacity so as to generate an entrepreneurial spirit and culture.* Identify the potential inherent in the region's wealth.* Generate its own occupations and new sources of work.* Prioritize initiatives and transform them into viable projects based on the agreements reached in the

nucleos.* Channeling its own contributions as well as those of the authorities and public and private organizations.

The origins of these results and the results themselves represent a learning experience for ECOPETROLin the following areas:

(1) Generating a diverse business culture in the company's areas of influence, not only in terms of the oilindustry but regarding other economic sectors as well. Based on knowledge of the region's potential, thisculture makes it possible to identify and formulate new productive projects that generate employment andinitiate new business development.(2) Strengthening community training programs on culture, the entrepreneurial spirit and productive projects.

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(3) Its participation should not consist exclusively of an economic contribution.(4) Promoting the participation of its workers, with whose knowledge it would be possible to generate majorcontributions to the business and industrial development of the regions and their communities.(5) The participation of territorial entities as part of its participation in the resolution of the unemploymentproblem.

Based on this experience, ECOPETROL may in the immediate future implement new ways of achievingthe following:

(1) Supporting the identification and formulation of new productive projects which generate jobs.(2) Strengthening economic development programs in the regions comprising its area of influence, via thecontribution of the knowledge of its workers in accompanying communities for business and socialdevelopment.(3) Generating a diverse business culture in the company's areas of influence, not only related to the industrybut also to other economic sectors.(4) Supporting the start of new business developments.(5) Strengthening awareness of the region's potential.(6) Promoting a greater degree of participation by territorial entities in accompanying initiatives, inclusion ofinitiatives in development plans and in the creation of educational, technical and financial tools for projectdevelopment.

ACHIEVEMENT: Increased acceptance of the participatory approach to development and peace promotedby the program. Its impact is considered to be HIGH and its results originate in the following:

(I) Its work is based on the opinions, interests and priorities of the citizens.(2) Consensus is arrived at jointly with the community.(3) Formulation of initiatives is based on community interests.(4) The support! accompaniment of a team of technical assistance promoters.(5) The discussion of the initiative with municipalities is based on long term development and peace objectives.(6) The creation of nucleos which promote community mobilization.(7) The promotion of this approach among nucleos, grassroots organizations, NGOs, public entities,businesses, business associations and local leaders, government, academic and business circles, as well asamong specialists in participatory development.

These results and the achievements themselves represent a learning experience for ECOPETROL in thefollowing areas:

(1) Knowledge of the participatory approach to development and peace.(2) Joint agreement with municipalities on long term development and peace initiatives. However, we considerlinks to the local administration as weak.(3) Acceptance and promotion of this approach to development and peace by the members of the participatingcommunity organizations, representatives of grassroots organizations, NGOs, public entities and regionalbusiness organizations, associations and union leaders; and at the national level, in government, academic andbusiness circles.(4) Strengthening of the ECOPETROL's corporate principle of SOCIAL RESPONSIBILITY, not only interms of its application in conflict areas subject, but also as a central element of company policy whichrecognizes development needs and elements in its neighboring communities which, jointly worked on withoutpretending to supplant the responsibility of the state, significantly alleviates adverse community circumstanceswhich could otherwise become law and order situations that affect the stability of companies and further

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negatively affect community development.

In the future, based on this experience ECOPETROL may build its relationship with the surroundingcommunity.

* ECOPETROL may promote and use this approach with the institutions it has relationships with in its workwith the surrounding community.

* ECOPETROL may use the participatory approach for peace and development, reaching agreements withmunicipalities on long-term peace and development initiatives.

SECTOR HYPOTHESES

REGARDING ECONOMIC ISSUES: GENERATING THE BUSINESS CAPABILITIES REQUIRED TODESIGN AND IMPLEMENT CROSS-SECTIONAL STRATEGIES (FINANCING, BUSINESSDEVELOPMENT, TECHNICAL ASSISTANCE AND APPROPRIATE TECHNOLOGY, ACCESS TOLAND AND IMPROVED LAND USE) MAKES IT POSSIBLE FOR THE PROGRAM TO ADVANCEECONOMIC PROCESSES CAPABLE OF REMOVING OBSTACLES TO REGIONAL DEVELOPMENT.

This capacity is reflected in: (1) The development of 40 productive initiatives (48% of the total currentlyunderway) related to marketing, industrial development, rural productive development and urban productivedevelopment that create economic opportunities for the poorest inhabitants; (2) More peasant families with thefinancing, technology and business capabilities required to pursue productive initiatives. Nevertheless,development of the land ownership component is very limited.

REGARDING EDUCATIONAL MATTERS: THE EDUCATIONAL COMMUNITIESPARTICIPATING IN INTEGRATED TRAINING PROCESSES LEARN TO DEVELOP THEIRPEDAGOGICAL PRACTICES AND THROUGH THEM, THEIR INTELLECTUAL POTENTIAL, INORDER TO ACCESS AND APPROPRIATE KNOWLEDGE AND TRANSFORM IT INTO ANEFFECTIVE TOOL USED TO TRANSFORM REALITY.

This effectiveness may be seen in the capacity communities developed in the community training, the trainingschool for the young, comprehensive basic schools for sustainable development, and the education citadel, all ofwhich seek to build participatory educational communities to enable the reconstruction of new educationalsocial relationships in the midst of the conflict.

REGARDING HEALTH CARE: COMMUNITY PARTICIPATION IN RESOURCE MANAGEMENT,AS PART OF A PLAN THAT SEEKS TO BUILD THE PUBLIC ENVIRONMENT BY MAKING USE OFLOCAL POTENTIAL, CONTRIBUTES TO PROGRESSIVELY IMPROVE THE QUALITY ANDEFFICIENCY OF HEALTH CARE SERVICES

This contribution is reflected in:* Community participation in the decisions regarding the administration of health care resources.* Its positive effect on the promotion and preventive health and in a broader subsidized health care coverage.

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INFORMATION, COMMUNICATION AND CULTURE: ADVANCES MADE IN THE CAPACITYOF THE NUCLEOS TO INVESTIGATE, PRODUCE AND ISSUE THEIR OWN INFORMATION,VALUES AND ACHIEVEMENTS STRENGTHENS THE CAPACITY OF THE REGION TO IMAGINEITSELF, SOCIALIZE ITS OWN MODELS, PROJECT TO THE NATION, INCREASE ITSPARTICIPATION IN DECISIONS REGARDING ITS OWN DEVELOPMENT AND REACHDEVELOPMENT AND PEACE OBJECTIVES BY BUILDING A COLLECTIVE MIND-SET OFBELONGING TO A REGION.

This strengthening is reflected in the following: Greater ability to produce and issue information about theregion in the conventional and local media.

Note: The health, communication and culture sector hypotheses lack strong supporting elements as well aslearning experiences by ECOPETROL. They have been given a low rating during the monitoring conducted bythe external evaluation.

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