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FOR OFFICIAL USE ONLY
Report No: PAD 3800
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT
PROGRAM APPRAISAL DOCUMENT
ON A
PROPOSED LOAN
IN THE AMOUNT OF EUR214.2 MILLION
(US$250 MILLION EQUIVALENT)
TO THE
KINGDOM OF MOROCCO
FOR A
MOROCCO GREEN GENERATION PROGRAM-FOR-RESULTS
November 20, 2020
Agriculture And Food Global Practice
Middle East And North Africa Region
This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.
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CURRENCY EQUIVALENTS
Exchange Rate Effective October 31, 2020
Currency Unit = MAD
MAD 9.23 = US$1
US$1 = EUR 0.85667780
FISCAL YEAR
January 1 - December 31
Regional Vice President: Ferid Belhaj
Regional Director: Ayat Soliman
Country Director: Jesko S. Hentschel
Practice Manager: Marianne Grosclaude
Task Team Leader(s): David Olivier Treguer, Maria Claudia Pachon
The World Bank Morocco Green Generation Program-for-Results (P170419)
ABBREVIATIONS AND ACRONYMS
ADA Agricultural Development Agency (Agence pour le Développement Agricole)
ADD Digital Development Agency (Agence du Développement Digital)
AFD French Development Agency (Agence Française de Développement)
ANAPEC National Agency for Employment and Competence Promotion (Agence Nationale de Promotion de l'Emploi et des Compétences)
BDS Business Development Services
CAM Crédit Agricole du Maroc
Cat DDO Catastrophe Development Policy Financing with a Deferred Drawdown Option
CDO Chief Digital Officer
CNCP National Commission for Public Procurement (Commission Nationale de la Commande Publique)
COPIL Steering Committee (Comite de Pilotage)
COVID-19 Coronavirus Disease 2019
CPF Country Partnership Framework
CVE High Level COVID-19 Watch Committee (Comité de Veille Economique)
CSA Climate Smart Agriculture
CSAIP Climate Smart Agriculture Investment Plan
DDFP Directorate for the Development of Value Chains (Direction du Développement des Filières de Production)
DEFR Directorate for Education, Training and Research (Direction de l’Enseignement, de la Formation et de la Recherche)
DF Directorate of Finance (Direction Financière)
DGCL General Directorate of Local Authorities (Direction Générale des Collectivités Locales)
DIAEA Directorate of Irrigation and Development of the Agricultural Space (Direction de l’Irrigation et de l’Amenagement de l’Espace Agricole)
DLI Disbursement Linked Indicator
DLR Disbursement Linked Result
DPA Provincial Directorate of Agriculture (Direction Provinciale de l’Agriculture)
DPF Development Policy Financing
DRA Regional Directorate for Agriculture (Direction Regionale de l’Agriculture)
DSS Directorate of Strategy and Statistics (Direction de la Stratégie et des Statistiques)
EBRD European Bank for Reconstruction and Development
EIA Environmental Impact Assessment
EIB European Investment Bank
ENA National Agriculture School of Meknès (Ecole Nationale d’Agriculture de Meknès)
ERP Enterprise Resource Planning
ESIA Environmental and Social Impact Assessment
ESMP Environmental and Social Management Plan
The World Bank Morocco Green Generation Program-for-Results (P170419)
ESSA Environmental and Social Systems Assessment
EU European Union
FIMABIO Interprofessional Federation of Organic Products in Morocco (Fédération Interprofessionelle du Bio au Maroc)
FAO Food and Agriculture Organization of the United Nations
FDA Agricultural Development Fund (Fond de Développement Agricole)
FSA Fiduciary Systems Assessment
FY Fiscal Year
GDP Gross Domestic Product
GEF Global Environmental Facility
GIS Geographic Information System
GoM Government of Morocco
GRS Grievance Redress Service
GGS Green Generation Strategy (Stratégie Génération Green)
GHG Greenhouse Gas
HCP High Commission for Planning (Haut Commissariat au Plan)
IAV Agronomic and Veterinary Institute (Institut Agronomique et Vétérinaire)
IBRD International Bank for Reconstruction and Development
ICPC Central Body for Corruption Prevention (Instance Centrale de Prevention de la Corruption)
IEG Independent Evaluation Group
IFC International Finance Corporation
IGA General Inspectorate of Agriculture (Inspection Générale de l’Agriculture)
IGF General Inspectorate of Finances (Inspection Générale des Finances)
IMF International Monetary Fund
INRA National Agronomic Research Institute (Institut National de Recherche Agronomique)
IPF Investment Project Financing
IoT Internet of Things
IPCC Intergovernmental Panel on Climate Change
ISP Implementation Support Plan
KfW Kreditanstalt fuer Wiederaufbau
M&E Monitoring and Evaluation
MAD Moroccan Dirham
MAPMDREF Ministry of Agriculture, Marine Fisheries, Rural Development, Water and Forests (Ministère de l’Agriculture, de la Pêche Maritime, du Développement Rural et des Eaux et Forêts)
MEFRA Ministry of Economy, Finance and Administration Reform (Ministère de l’Economie, des Finances et de la Reforme de l’Administration)
MENA Middle East and North Africa
MFD Mobilizing Finance for Development
MI Ministry of Interior (Ministère de l’Intérieur)
MICEVN Ministry of Industry, Commerce, Green and Digital Economy (Ministère de l’Industrie, du Commerce, de l’Economie Verte et Numerique)
MIS Market Information Systems
The World Bank Morocco Green Generation Program-for-Results (P170419)
MISAGRI Integrated Financial Management System
MSME Micro-, Small- and Medium-Sized Enterprises
MT Metric Ton
MTIP Ministry of Employment and Professional Insertion (Ministère de l’Emploi et de l’Insertion Professionnelle)
NGO Non-Governmental Organization
ONCA National Agricultural Extension Agency (Office National du Conseil Agricole)
ONSSA National Food Safety Agency (Office National de Sécurité Sanitaire des Produits Alimentaires)
O&M Operation and Maintenance
OPRC Operational Procurement Review Committee
ORMVA Regional Agricultural Development Office (Office Régionaux de Mise en Valeur Agricole)
PforR Program-for-Results
PAP Program Action Plan
PDO Program Development Objective
PEFA Public Expenditure and Financial Accountability
PMU Program Management Unit
PMV Morocco Green Plan (Plan Maroc Vert)
PNEEI National Program for Irrigation Water Saving (Programme National d’Economie d’Eau en Irrigation)
POM Program Operational Manual
PPP Public Private Partnerships
RA Result Area
RISE Resilient, Inclusive, Sustainable and Efficient
SDL Local Development Company (Société de Développement Local)
SMAG Guaranteed Minimum Agriculture Wage (Salaire Minimum Agricole Garanti)
SME Small and Medium-Sized Enterprises
SMIG Minimum Legal Wage (Salaire Minimum Legal)
SORT Systematic Operations Risk-Rating Tool
SPS Sanitary and Phytosanitary
ToC Theory of Change
UNDP United Nations Development Program
UNIDO United Nations Industrial Development Organization
US United States of America
USAID United States Agency for International Development
US$ United States Dollars
WB World Bank
The World Bank Morocco Green Generation Program-for-Results (P170419)
TABLE OF CONTENTS DATASHEET........................................................................................................................................1
I. STRATEGIC CONTEXT ..................................................................................................................6
A. Country Context .....................................................................................................................6
B. Sectoral and Institutional Context ...........................................................................................8
C. Relationship to the CPF and Country Program Adjustment Responding to COVID-19 .............. 13
D. Rationale for Bank and AFD Engagement and Choice of Financing Instrument ........................ 16
II. PROGRAM DESCRIPTION ........................................................................................................... 18
A. Government Program .......................................................................................................... 18
B. Program Development Objective (PDO) and PDO Level Results Indicators ............................. 20
C. Program Scope and Description ............................................................................................ 20
D. Disbursement Linked Indicators and Verification Protocols ................................................... 33
E. Theory of Change ................................................................................................................. 36
III. PROGRAM IMPLEMENTATION .................................................................................................. 37
A. Institutional and Implementation Arrangements .................................................................. 37
B. Results Monitoring and Evaluation ....................................................................................... 39
C. Disbursement Arrangements ................................................................................................ 39
D. Capacity Building ................................................................................................................. 40
IV. ASSESSMENT SUMMARY .......................................................................................................... 40
A. Technical ............................................................................................................................. 40
B. Program economic rationale ................................................................................................ 44
C. Fiduciary .............................................................................................................................. 44
D. Environmental and Social ..................................................................................................... 46
E. RISK ASSESSMENT ................................................................................................................ 48
F. PROGRAM ACTION PLAN ...................................................................................................... 49
ANNEX 1. RESULTS FRAMEWORK MATRIX ........................................................................................ 50
ANNEX 2. DISBURSEMENT LINKED INDICATORS, DISBURSEMENT ARRANGEMENTS AND VERIFICATION PROTOCOLS ..................................................................................................................................... 69
ANNEX 3. TECHNICAL ASSESSMENT .................................................................................................. 84
ANNEX 4. SUMMARY FIDUCIARY SYSTEMS ASSESSMENT ................................................................ 122
ANNEX 5. SUMMARY ENVIRONMENTAL AND SOCIAL SYSTEMS ASSESSMENT .................................. 141
ANNEX 6. PROGRAM ACTION PLAN ................................................................................................ 147
ANNEX 7. IMPLEMENTATION SUPPORT PLAN ................................................................................. 151
ANNEX 8. CATALYZING GROWTH, INCLUSION AND JOBS THROUGH AGRICULTURE IN MOROCCO ..... 153
The World Bank Morocco Green Generation Program-for-Results (P170419)
ANNEX 9. GREEN GENERATION STRATEGY: BRIEF PRESENTATION ................................................... 157
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DATASHEET
BASIC INFORMATION BASIC_INFO_TABLE
Country(ies) Project Name
Morocco Morocco Green Generation Program-for-Results
Project ID Financing Instrument Does this operation have an IPF component?
P170419 Program-for-Results Financing
No
Financing & Implementation Modalities
[ ] Multiphase Programmatic Approach (MPA) [ ] Fragile State(s)
[ ] Contingent Emergency Response Component (CERC) [ ] Fragile within a non-fragile Country
[ ] Small State(s) [ ] Conflict
[ ] Alternate Procurement Arrangements (APA) [ ] Responding to Natural or Man-made Disaster
[ ] Hands-on Enhanced Implementation Support (HEIS)
Expected Project Approval Date Expected Closing Date
15-Dec-2020 31-Dec-2025
Bank/IFC Collaboration
No
Proposed Program Development Objective(s)
The PDO is to increase the economic inclusion of youth in rural areas and the marketing efficiency and environmental sustainability of agri-food value chains in the Program area.
Organizations
Borrower :
Kingdom of Morocco
Implementing Agency : Ministry of Agriculture, Fisheries, Rural Development, Water and Forestry
Contact: Redouane Arrach
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Title: Director of Strategy and Statistics
Telephone No: 212657831993
Email: [email protected]
COST & FINANCING FIN_SUMM_WITH_IPF SUMMARY
Government program Cost 10,000.00
Total Operation Cost 487.00
Total Program Cost 487.00
Total Financing 487.00
Financing Gap 0.00
Financing (USD Millions)
Counterpart Funding 122.00
Borrower/Recipient 122.00
International Bank for Reconstruction and Development (IBRD) 250.00
Cofinancing - Other Sources (IFIs, Bilaterals, Foundations) 115.00
FRANCE: French Agency for Development 115.00 Expected Disbursements (USD Millions)
Fiscal Year
2021 2022 2023 2024 2025 2026
Absolute
60.00 30.00 50.00 50.00 40.00 20.00
Cumulative
60.00 90.00 140.00 190.00 230.00 250.00
INSTITUTIONAL DATA
INSTITUTIONAL DATA TBL
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Practice Area (Lead) Contributing Practice Areas
Agriculture and Food Digital Development, Water
Climate Change and Disaster Screening
This operation has been screened for short and long-term climate change and disaster risks
SYSTEMATIC OPERATIONS RISK-RATING TOOL (SORT)
Risk Category Rating
1. Political and Governance ⚫ Moderate
2. Macroeconomic ⚫ Moderate
3. Sector Strategies and Policies ⚫ Moderate
4. Technical Design of Project or Program ⚫ Moderate
5. Institutional Capacity for Implementation and Sustainability ⚫ Moderate
6. Fiduciary ⚫ Moderate
7. Environment and Social ⚫ Moderate
8. Stakeholders ⚫ Moderate
9. Other
10. Overall ⚫ Moderate
COMPLIANCE
Policy
Does the program depart from the CPF in content or in other significant respects?
[ ] Yes [✔] No
Does the program require any waivers of Bank policies?
[ ] Yes [✔] No
Legal Operational Policies
Triggered
Projects on International Waterways OP/BP 7.50 No
Projects in Disputed Areas OP/BP 7.60 No
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Legal Covenants Sections and Description Ref. section I.A.1(a) of Schedule 2:
no later than thirty (30) days after the Effective Date, or such later date as agreed by the Bank, establish within its
DSS and thereafter maintain, through Program implementation, a Program Management Unit (“PMU”),
responsible for the monitoring of day-to-day implementation of the Program, including the preparation of the
Program’s annual progress reports, preparation of pertinent financial statements, and staffed with adequate
professional, fiduciary, administrative and technical personnel, with qualifications, experience and terms of
employment acceptable to the Bank, all as described in the POM;
Sections and Description Ref. Section I.A.1(b) of Schedule 2:
no later than thirty (30) days after the Effective Date, or such later date as agreed by the Bank, establish and
thereafter maintain, throughout Program implementation, a Steering Committee, composed of representatives of
the entities and institutions participating in the implementation, monitoring and evaluation of the Program,
responsible for strategic oversight and guidance under the Program, all under terms and conditions acceptable to
the Bank and described in the POM; and
Sections and Description Ref. Section I.B.1 of Schedule 2:
Prior to carrying out the construction of each of the modernized wholesale market in each of the Selected Cities
under Part 2.1(b) of the Program (DLR#5.4), the Borrower shall: (a) together with the relevant Borrower’s national
and subnational authorities, enter into a Convention Spécifique under terms and conditions set forth in the POM,
including the Borrower’s obligation to ensure that the construction works and oversight of the relevant
modernized wholesale market complies with the pertinent provisions of the POM (including the pertinent actions
under the Program Action Plan)
Sections and Description Ref. Section I.B.2 of Schedule 2:
The Borrower shall, prior to the commencement of any construction works under Part 2.1(b) of the Program,
prepare, consult, publish and implement the corresponding ESIA/ESMP and, if applicable, a Resettlement Action
Plan, all in accordance with their terms.
Sections and Description Ref. Section I.B.3 of Schedule 2:
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The Borrower shall: (a) no later than thirty (30) days after the Effective Date, or such later date as agreed by the
Bank, adopt a manual under terms and conditions acceptable to the Bank (“Program Operational Manual” or
“POM”); and (b) immediately thereafter, carry out the Program in accordance with the POM. The Borrower shall
not amend or waive any provision of the POM without the Bank’s prior written consent. In case of any conflict
between the terms of the POM and those of this Agreement, the terms of this Agreement shall prevail.
Sections and Description Ref. Section I.B.5 of Schedule 2:
The Borrower shall carry out verification missions through the IGA for the verification of achievement of DLRs 1
through 9 which are set forth in the table in Section IV.A.2 of this Schedule in accordance with the Verification
Protocol, and furnish to the Bank not later than sixty (60) days after the verification of compliance of said DLRs, a
report on the results of said verification of compliance process of such scope and in such detail as the Bank shall
reasonably request.
Sections and Description Ref. Section 4.01:
The Co-financing Deadline for the effectiveness of the Co-financing Agreement is January 5, 2022.
Conditions
Type Description Effectiveness The Additional Condition of Effectiveness consists of the following, namely, that
the Convention-cadre has been executed and is in full force and effect.
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I. STRATEGIC CONTEXT
A. Country Context
1. The proposed Green Generation Program-for-Results (PforR) co-financed by the World Bank (WB) and the French Development Agency (Agence Française de Développement, AFD) aims to support the Kingdom of Morocco in deploying a swift response to the economic hardship and job losses resulting from the COVID-19 pandemic while helping prevent and mitigate the impacts of severe droughts such as the one that the country is currently facing1. A focused effort to mitigate job losses and to improve employment opportunities for the most vulnerable groups is at the core of the COVID-19 pandemic response by the Government of Morocco (GoM). The launch of the Green Generation Strategy (GGS) 2020-2030 by King Mohamed VI in February 2020 represents a major shift in focus from a production-centered strategy to a people-centered strategy and comes at a very opportune time to respond to the COVID-19 crisis. It offers a clear pathway to job creation and increasing economic opportunities in Morocco’s relatively more disadvantaged rural areas, as the country addresses and recovers from the COVID-19 pandemic. The GGS emphasizes fostering the growth of the middle class in rural areas, job creation for the youth on- and off-farm and building human capital and skills to facilitate higher productivity employment and labor mobility. The strategy also aims at accelerating the transition towards a more climate resilient agriculture initiated under the Green Morocco Plan (Plan Maroc Vert, PMV). This strategic thrust is fully consistent with the response needed to address the crisis brought by the COVID-19 pandemic, as well as to address the longer-term structural constraints in the agricultural sector, e.g. to address recurring droughts.
2. Morocco has made significant social and economic progress over the past decade due to large public investments, political, institutional and sector reforms, along with measures to ensure macroeconomic stability. The resulting growth has led to dramatic progress in eradicating extreme poverty, a sharp decline in the national poverty rate, increased life expectancy, greater access to basic public services, including universal access to primary education, and significant public infrastructure development. In the 2000-2019 period, Morocco’s real per capita Gross Domestic Product (GDP) almost doubled from US$1,727 to US$2,948. However, economic growth remains below potential, dependent on natural resource sectors and constrained by low productivity. Real GDP growth slowed down in 2019 to 2.5 percent compared to 4.2 percent in 2017, due to the volatile performance of the rainfed agricultural sector and slow growth in the tertiary sector.
3. Growth is projected to take a significant hit in 2020 compared to the pre-COVID-19 pandemic projections, whereas the financing needs of the GoM will increase. The COVID-19 pandemic is posing a significant challenge for Morocco’s public health system, with wide-ranging social and economic implications. Over the coming months, the COVID-19 outbreak could claim more lives particularly amongst the most vulnerable and poor. COVID-19 has pushed the Moroccan economy into a deep recession with real GDP growth expected to shrink by 6.3 percent in 2020, compared to a 3.6 percent growth expected before the pandemic. The economic contraction is primarily due to the impact of the COVID-19 pandemic on non-agricultural growth (-5.9 percent in 2020): it is mainly driven by a declining production of goods and services and reduced exports due to social distancing measures and disrupted global value chains, as well as by a decline in tourism in the context of border lockdowns. The crisis will also adversely affect the fiscal deficit and in turn the central government’s debt as tax revenues, customs duties and grants are projected to decline, while the authorities ramp up spending on healthcare and social safety nets.
1 Preliminary forecasts for the upcoming 2020 harvest point to a total cereal production of about 4.1 million tons, almost one fourth lower than the previous year’s already weather-stricken harvest and about 50 percent below average.
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4. Despite ambitious sectoral programs, the pattern of growth has not been sufficiently inclusive, particularly in rural areas. Poverty rates in rural areas remain twice as high as those at the national level, while the rural population accounts for 79.4 percent of the poor. Job creation is particularly weak, with inclusiveness and job quality posing significant challenges, especially for the youth, women and educated workers. Net job creation has been insufficient to keep up with the annual increase of the working-age force (over 300,000 per year) and the unemployment rate has remained high (9.2 percent in 2019) and even higher among the youth and the educated. Female labor force participation remains very low (25 percent in 2017), with women working predominantly in low productivity sectors and low-skill occupations.
5. Recognizing these challenges, King Mohamed VI, in his speech for the 20th anniversary of the Throne on July 28, 2019, called for a new and inclusive development model, underlining a key role of the private sector in supporting economic and social inclusion. He highlighted that while Morocco has made solid progress in infrastructure, connectivity, and access to basic services, significant challenges related to human development, social and economic inclusion and territorial disparities persist and require a revision of the country’s development model. He has created a special commission tasked with delineating a new development model for the country and emphasized the need for deeper and faster reforms to improve public services, spur economic openness, and enhance (and coordinate better) sectoral strategies.
6. The GoM has also outlined a vision for economic growth and social inclusion in its five-year Government Program (2017–2021). The Government Program builds on previous political, economic, and social achievements, while renewing the development model to create enabling conditions to become an emerging economy. The program emphasizes upgrading large export industries and supporting start-up companies and micro-, small, and medium-sized enterprises (MSMEs) through a package of financial and non-financial resources. The ultimate objective is to develop a more competitive private sector capable of creating quality jobs, while establishing Morocco as an attractive destination for foreign investment and business expansion. The five main pillars of the program are governance, youth employment through entrepreneurship support, climate change, human capital, and social cohesion.
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7. Morocco has also been supporting green growth2 and seeking to increase the resilience and adaptation of rural populations to climate change through the PMV and the recently launched GGS. The PMV was launched in 2008 with the aim of supporting the growth and competitiveness of the agricultural sector, leveraging it to support inclusive growth, particularly among poor and rural populations, and enhancing the resilience of the sector to weather volatility and climate change (see Box 1). In late 2019, the mandate of the Ministry of Industry and Trade was expanded to also include the portfolios of the Digital and Green Economy, further highlighting GoM’s commitment to seizing the opportunity of green growth and tackling head-on the challenges posed by climate change. On February 13, 2020, King Mohamed VI launched the new GGS to build on the success of the PMV and create a new generation of agricultural workers and entrepreneurs particularly among young and rural populations, with innovative support measures.
B. Sectoral and Institutional Context
8. The sizeable public and private investments—coupled with key reforms—under the PMV have led to a strong sectoral performance over the last decade and a structural shift in the composition of agricultural GDP. Since the late 1990s, agricultural output in high-productivity subsectors has increased markedly. This positive momentum was further accelerated by the PMV, with record achievements, notably for the arboriculture (olives, citrus, dates), vegetable and the red meat subsectors3. The increase in the share of production that is less vulnerable to climatic variations has led to a decrease in the variability of agricultural GDP overall4.
9. Moroccan agri-food exports also recorded sustained growth during the 2000-2018 period, reducing the agri-food trade deficit. Exports grew at an average annual rate of 9.5 percent and 8.2 percent for exports of raw and processed agri-food products, respectively. This positive trend has reduced the trade deficit of agri-food products, which fell by 47.1 percent over the 2008-2018 period5 (from MAD2.4 billion to MAD1.13 billion). Despite this decline, the coverage rate of agri-food imports remains relatively low, standing at 52 percent over the 2008-2018 period. Morocco could increase its
2 In his 2009 and 2010 Throne Speeches King Mohammed VI called for comprehensive legislation on environment management, and explicitly set “Green Growth” as a priority in government policy. Two Inclusive Green Growth development policy loans were financed by the WB in 2013 and 2015 (P127956 and P149747 for a total of US$600 million). 3 Their production recorded average annual growth rates of 7.8 percent, 6.3 percent and 4.8 percent, respectively, over the period 2008-2018.
4 Annex 8 provides more details on the recent performance of the agricultural sector in Morocco. 5 Ministry of Finance: “Le secteur agricole marocain : tendances structurelles, enjeux et perspectives de développement” (2019)
Box 1. Plan Maroc Vert: Investment and Key Results
Over the 2008-2018 period, the PMV has catalyzed substantial investments in Morocco’s agriculture. At the macro-level, it has led to impressive impacts by leveraging significant investment and improving the performance of the agricultural sector. Public investment financed through the PMV was mainly used to expand drip irrigation and improve water resources management and efficiency, diversification by shifting towards high value agriculture (olives, dates, fruit trees, and vegetables), and to promote the large-scale adoption of climate-smart agriculture practices. Cumulative investment under the PMV reached MAD10 billion over 2008-2018 (40 percent public, and the remainder leveraged from the private sector, including farmers). Agricultural value added in real terms has almost doubled. A shift occurred towards higher value-added products, leading -- despite a challenging external environment -- to more than doubling of Morocco’s agricultural exports and export growth rates of 9.5 and 8.2 percent for fresh and processed agri-food products , even though cereals continue to dominate production and drive the trade balance. The volatility of agricultural sector growth has significantly declined (due to a shift towards a more climate resilient production and the expansion of drip irrigation). The areas under drip irrigation have increased 3.7 times through the PMV (and cover nearly 40 percent of total irrigated area), greatly enhancing resilience to droughts. The PMV has also led to the creation of 250,000-300,000 full-time equivalent jobs in agriculture over 2008-2018. Source: Ministry of Finance and HCP data (2019), World Bank Ag Sector Review (2020)
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agriculture exports further, provided it diversifies its export products and markets, and puts in place policies that allow it to enhance its competitiveness. The country’s agricultural exports have remained concentrated on a very limited number of products and markets, although the PMV has provided a set of subsidies for export promotion and diversification. In 2018, 20 products6 accounted for 71 percent of total agricultural and agro-industrial exports, of which only 9 products accounted for 51 percent. In 2018 and in terms of values, more than 71 percent of agriculture exports were concentrated on the European Union (EU) and 72 percent of exports to the EU are concentrated on two countries that are France (40 percent) and Spain (32 percent).
10. The agricultural sector remains the main provider of jobs in Morocco, with a contribution of nearly 38 percent of total employment. In rural areas, this proportion increases to 74 percent, which positions agriculture at the center of economic and social challenges. Despite the relative decline in its share in total employment, agricultural employment in absolute terms has been mostly stable, evolving at an annual growth rate of 0.08 percent over the period 2000-2017. While Morocco is experiencing a relative stability in its agricultural employment, other comparable countries, such as Egypt, Turkey and Mexico, recorded a relative increase in their employment in the sector, with annual growth rates of 1.51 percent, 1.25 percent and 0.18 percent respectively over the same period.
11. Climate change is putting increased pressure on water and land resources and is likely to have negative impacts on agricultural production, which risks triggering food security issues. Overall, mean temperatures already have risen by 0.9 degrees centigrade since 1960. The increasing variability of precipitation and the higher frequency of droughts are likely to reduce the availability of water resources which would in turn negatively impact agricultural yields. Morocco has already experienced a sharp decrease in water availability per capita of nearly 71.5 percent over the period 1950-2010, below the threshold of water stress (1,000 m3 / person / year) and getting close to the threshold of absolute scarcity (500 m3/person/year). According to the Intergovernmental Panel on Climate Change (IPCC), additional temperature increases of as much as three to seven degrees Centigrade are projected for Morocco by 2100. The largest increases (four to seven degrees) are anticipated for the summer months (June-August). Annual precipitation is projected to decline by 10-40 percent, including a 10-30 percent decrease during the wet season from October to April, and a 10-40 percent decrease during the dry season, from May to September. Consequently, droughts and other extreme weather events will increase in frequency and intensity in Morocco and affect agricultural productivity substantially, considering that 83 percent of the cultivated area is rain-fed. Additionally, climate change will affect food utilization primarily by reducing food safety through a higher incidence of food-borne diseases and spread of novel pests and diseases. Moreover, agriculture and land use activities represent the second main source of greenhouse gas emissions (20.6 percent) in Morocco, although their overall volume remains low. To ensure the sector’s sustainability, Morocco has incorporated climate change into its
6 According to the 10-digit SH classification.
Box 2. Regional Distribution of Agricultural Production and Growth
The analysis of the regional distribution of agricultural production during the period of 2001-2016 brings out dynamic overall picture, with sharp contrasts. The Fès-Meknès Region recorded the largest share in the national agricultural GDP, with an average share of 16.5 percent, followed by the Marrakech-Safi Region (14.2 percent), Rabat- Salé-Kénitra (13.4 percent) and the Casablanca-Settat Region (12 percent). In terms of growth, the Souss-Massa Region posted the best mean annual growth over the same period (7.6 percent), followed by the Drâa-Tafilalet (7.4 percent) and Beni Mellal-Khénifra Regions (5.7 percent). The regions which were the least dynamic are those of Casablanca-Settat (2.7 percent annual growth rate) and the Oriental (3.3 percent). Furthermore, with the exception of four regions, namely Guelmim-Oued-Noun, Casablanca-Settat, Rabat-Salé-Kénitra and Tanger-Tétouan-Alhoceima, all the other regions of the Kingdom posted an average share of agriculture in their regional GDPs higher than the national average which stood at 11.8 percent over the period of 2001-2016. This situation shows the significant weight of agriculture in the economy of these regions, in particular those of Fès-Meknès and Beni Mellal-Khénifra, where agriculture contributed nearly 19 percent to their regional GDPs. Source: Ministry of Finance and HCP data (2019)
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development strategies to manage its impact and reduce vulnerabilities. Morocco’s vision is to make its territory and people more resilient to climate change, while ensuring a rapid transition to a low carbon economy.
12. Based on lessons learned, the GoM is now looking under the GGS at ways to deepen and increase the positive impacts of the PMV7. On the production and marketing side, the evaluation of the PMV carried out by the Ministry of Agriculture, Marine Fisheries, Rural Development, Water and Forests (Ministère de l’Agriculture, de la Pêche Maritime, du Développement Rural et des Eaux et Forêts, MAPMDREF) in 2018 highlights three main areas of improvement: (i) better structuration of distribution channels; (ii) the modernization of slaughterhouses; and (iii) more value addition. However, the same evaluation also points to the need for a more inclusive strategy, acknowledging that the PMV has not benefited enough small-scale producers and other vulnerable groups, particularly women and youth. Lastly, the GGS indicates that more needs to be done to develop a sustainable agricultural sector. Hence, building on the achievements of the PMV, the new strategy focuses on creating a rural middle class with a strong focus on increasing human capital and ensuring sustainable agricultural development. Figure 1 below presents an overview of how Morocco’s agricultural policies and strategies have evolved since 19858.
Figure 1: Evolution of Agricultural Policies and Strategies in Morocco since 1985
Source: adapted from MoF/DEPF (2019)
13. Youth in rural areas represent an untapped potential for agricultural development through the creation of new enterprises—a key pathway for responding to the economic impact of the COVID-19 pandemic. As the agricultural sector undergoes a successful structural transformation, the on-farm share of employment in agriculture tends to decline, while employment in the broader agri-food sector grows significantly relative to on-farm employment (e.g. USA, France, and Brazil)9. Morocco appears to be on the same transition path. In this respect, entrepreneurship programs for rural youth have a critical role to play both from the demand side, through the creation of new enterprises, and, from the supply side, through support to income-generating activities. Women may be able to benefit from these opportunities to a greater extent than from on-farm activities, and efforts need to specifically target women against the backdrop of the recent overall decline of women’s employment in agriculture.
7 A more detailed description of the GGS is provided in Annex 9. 8 In terms of incentive structure, Morocco offers its farmers guaranteed prices for food and industrial crops and a large range of subsidies for the purchase of inputs. Price support for essential goods and energy subsidies (for pumps) is also widespread. 9 World Bank (2007): Agriculture for Development. World Development Report 2008.
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14. Multipronged youth employment programs are needed to tackle the supply- and demand-side constraints faced by young men and women in rural areas. Some 750,000 young people operate very small businesses (around 17 percent of young employed workers), but most do so out of necessity. This proportion remains very low compared to other countries. Several factors explain the low participation of young people in entrepreneurship and the lack of dynamism of these small businesses: (i) lack of entrepreneurial spirit, (ii) lack of structures to support entrepreneurship in rural areas, (iii) limited access to finance for young people, who have neither guarantees nor collateral to access a loan, (iv) limited access to land for young people wishing to develop their agricultural holdings, and (v) agricultural activities perceived by young people as a subsistence rather than buoyant income generating activities. Building on international experience related to youth employment programs (see Box 3), a successful approach would entail: (i) on the demand side— raising awareness on economic, technical and financial opportunities available and accessible to young people, and (ii) on the supply side— improving rural entrepreneurship services delivery through the establishment of an appropriate technical and financial support system specific to rural areas and dedicated to the youth.
15. Upgrading marketing infrastructure would help further strengthen agri-food value chains and increase their resilience to crises like the one brought by the COVID-19 pandemic. Dysfunctional wholesale marketing and distribution systems—for fruit and vegetables in particular—result in high marketing costs, low producer incomes and high consumer prices in domestic markets, while undermining incentives for improving quality and food safety. Outdated wholesale markets are also challenged to implement the necessary health protocols to ensure safe market operations made necessary by public health crises (like the COVID-19 pandemic). This situation is mainly caused by an inadequate regulatory framework, the lack of investments in wholesale markets facilities and the inefficiency of current business and market management models which have also led to the development of informal markets. Tackling regulatory constraints and increasing inter-institutional collaboration while modernizing the marketing infrastructure will increase the competitiveness of value chains and increase their resilience to market shocks.
Box 3. Effectiveness of Youth Employment Programs, Including in Rural Areas
As suggested by the international literature on youth employment programs, most effective approaches are comprehensive, underpinned by multipronged strategies with complementary interventions aimed at removing both supply- and demand-side constraints and market failures, including influencing job creation and work opportunities for youth (offered by firms and through self-employment), labor markets characteristics, and labor supply (skills and labor attributes). Demand-side exclusive interventions could also be effective, as demonstrated by the EU Youth Employment Initiative that targets “young people not in employment, education, or training” (NEETs), through internships and hiring support schemes. Moreover, a systematic review conducted by the WB Independent Evaluation Group (IEG) of 38 impact evaluations of youth employment programs found that factors increasing their success probability – on top of presence of complementary interventions – include participation of the private sector and personal monitoring and follow up of individual participants. In rural low-income areas, where most youth are active in agriculture and non-farm employment or self-employment, stimulating the market environment for growth of farms and rural agribusinesses has proven essential. Zooming in on entrepreneurship trainings supported by WB operations in rural areas, positive impacts were demonstrated in Uganda and Colombia. More specifically, the participants of the Youth Opportunity Program in Northern Uganda, which provided unconditional cash grants to underemployed youth groups to pay about 10 weeks of full-time vocational training, tools, and business startup costs, reported a 45 percent increase in net earnings compared to their status before enrolling in the program. In Colombia, the WB-supported Young Rural Entrepreneurs training program increased participants’ employment rate by about 14 percentage points compared to the control group. At the same time, other similar programs elsewhere have demonstrated mixed results, and the paucity of project data limits the ability to make any generalized statements on the impact of WB interventions targeting youth employment on broader labor market outcomes. Source: EU (2020) and IEG (2012)
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16. Digital technologies offer some of the much-needed solutions to the challenges faced by Moroccan agri-food value chains and represent key opportunities to adapt and respond to the COVID-19 crisis. Driven by both the public and private sectors, the digital transformation of Moroccan agriculture has begun. The opportunities offered by digital technologies enable the agricultural sector to move from an intensive production model to precision farming, responding as much to the imperatives of productivity and competitiveness as to the challenges of climate change adaptation. More concretely, digital technology can tackle various fields of agriculture, through a multitude of tools: the new sources of spatial and temporal data, combined with networks of connected objects and weather data, provide a continuous flow of information which contributes to improving the efficiency of agricultural activities. This evolution towards precision farming, reinforced by new decision-making support tools for farmers via mobile internet can reduce risks by responding to various problems in a timely manner (e.g. lack of water) and also help adapt to social-distancing measures enforced during the COVID-19 crisis. Considering the structural bottlenecks in the agricultural sector, notably the binding labor market and farm services constraints to further productivity gains and inclusive jobs growth, digital services and information systems in the agricultural sector will be particularly effective as they can promote a more efficient and integrated pool of labor and farm services. Furthermore, experience from other countries shows that technology can make farming more attractive for young people in rural areas. Digital technologies can be increasingly used to engage rural youth in farming and help strengthen the economic response to the COVID-19 crisis by spurring job creation10. A review by the United States Agency for International Development (USAID) in 2018 showed that “Young people are often more ready and eager to master these new technologies and apply them to agriculture to increase productivity and solve challenges (World Farmers’ Organization, 2017). At the same time, these technologies can help demonstrate to youth how agriculture can be a viable and profitable business opportunity, increasing the desirably of agriculture-related career paths, in lieu of alternatives youth might otherwise be seeking”11. While the design of the proposed Program has been devised before the onset of the COVID-19 pandemic, the components included under the Program will support Morocco in adapting and responding to COVID-19 as well as in responding to future similar crises.
17. Climate Smart Agriculture (CSA) solutions—including more efficient irrigation systems— can sustainably improve agricultural productivity, adapt and build the resilience of the agriculture and food systems, and reduce greenhouse gas (GHG) emissions from agriculture. Irrigation has been an important contributor to agricultural productivity growth, but it is also putting more pressure on water resources. Despite accounting for only 16 percent of the cultivated area, irrigated agriculture generates 75 percent of agricultural exports and 15 percent of total exports. Growing water scarcity, linked to an increasingly frequent pattern of droughts and overall declines in rainfall, has reduced surface water availability and led producers to supplement supplies through groundwater, leading in turn to depletion of aquifers. The GoM has developed a long-term program through 2030: the National Program for Irrigation Water Saving (Programme National d’Economie d’Eau en Irrigation, PNEEI), the Irrigation Extension Program (Programme d’Extension de l’Irrigation, PEI) and the Public-Private Partnership, particularly around seawater desalination to address the challenge, including support for large-scale irrigation modernization to save water, by converting canal irrigation to localized sprinkler and drip schemes, with widespread metering and the promotion of renewable energy utilization. More needs to be done to support research institutions and the private sector to develop new technologies, make them commercially viable, and foster technology adoption by farmers.
18. The launch of the GGS is very opportune considering the double crisis of the COVID-19 pandemic and the ongoing drought. In particular, the following aspects will be critical in helping address and move beyond the crisis: (i) the emphasis on youth employment in rural areas would be a key element of GoM’s economic response to the crisis; (ii) support to food supply chains would help seize new opportunities in export markets and ensure that domestic supply chains are resilient during such crises; (iii) interventions related to digital agriculture will help accelerate the digital
10 https://hbr.org/2017/05/how-digital-technology-is-changing-farming-in-africa 11 https://www.usaid.gov/sites/default/files/documents/15396/Feed-the-Future-CaseStudy-Youth-Ag-ICT.pdf
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transformation of the sector—made even more necessary by the COVID-19 crisis (e.g., e-extension service; e-marketing, and e-labor pools and farm services— which are key responses to social distancing measures); and (iv) the green dimension of the GGS—in particular related to water efficiency measures in irrigation— is a key element to prevent and mitigate the impacts of severe droughts such as the current one.
19. MAPMDREF is responsible for designing and implementing the Government’s agriculture and rural development policy. The Ministry coordinates the implementation of the GGS with the support of several autonomous agencies that it oversees. Those agencies include: (i) the National Food Safety Agency (Office National de Sécurité Sanitaire des Produits Alimentaires, ONSSA) which controls the application of norms and regulations related to food safety and SPS (sanitary and phytosanitary products, seed and plant varieties, pests and diseases, traceability), (ii) the National Agricultural Extension Agency (Office National du Conseil Agricole, ONCA), responsible for providing training and advisory services to producers and their organizations, (iii) the Agricultural Development Agency (Agence pour le Développement Agricole, ADA) which promotes private investment in both commercial and smallholder agriculture projects, (iv) Morocco Foodex (Etablissement autonome de coordination et de contrôle des exportations) which is in charge of the coordination, promotion and control of agri-food exports, and (v) the National Agronomic Research Institute (Institut National de Recherche Agronomique, INRA) undertakes agricultural research in various areas (e.g. adaptation to climate change, irrigation, productivity and soil conservation) through 10 regional agricultural research centers. Other research institutions include the Agronomic and Veterinary Institute (Institut Agronomique et Vétérinaire Hassan II, IAV) and the National Agriculture School of Meknès (Ecole Nationale d’Agriculture de Meknès, ENA).
20. The implementation of the GGS also involves close coordination with other government agencies. Those include the Ministry of Interior (Ministère de l'Intérieur, MI), the Ministry of Economy, Finance and Administration Reform (Ministère de l’Economie, des Finances et de la Reforme de l’Administration, MEFRA), the Ministry of Industry, Commerce, Green and Digital Economy (Ministère de l’Industrie, du Commerce, de l’Economie Verte et Numerique, MICEVN), the Wilayas, and the regional partners for the management of marketing infrastructures. The Crédit Agricole du Maroc (CAM) provides financial services to producers through a range of financial products (commercial, intermediate and microfinance).
C. Relationship to the CPF and Country Program Adjustment Responding to COVID-19
21. Over the past two decades, Morocco has achieved significant economic and social progress due to large public investments, structural reforms, along with measures to ensure macroeconomic stability. High investment efforts and a capital-intensive development model have contributed to sustained growth, significant progress towards eradicating extreme poverty, increased life expectancy, greater access to basic public services, and significant public infrastructure development. This approach however showed limitations in terms of creating sufficient jobs, especially for the young, and reducing geographical and socio-economic inequities. The shock brought by the COVID-19 pandemic is now abruptly pushing the economy into a recession, the first one since 1995, and threatening the social and economic gains reached over the past years. The proposed Program is aligned with the World Bank Group (WBG) twin goals on ending extreme poverty and promoting shared prosperity in a sustainable manner. The Program will contribute to alleviating the impacts of the COVID-19 pandemic and it is aligned with the World Bank Group’s COVID-19 Crisis Response Approach Paper’s Pillar 2 “Protecting Poor and Vulnerable People”, Pillar 3 “Ensuring Sustainable Business Growth and Job Creation”, and Pillar 4 “Strengthening Policies, Institutions and Investments for Rebuilding Better. The World Bank Group’s engagement under the Country Partnership Framework (CPF) 2019-202412, discussed by the Executive Directors on February 19, 2019
12 The CPF is structured around three strategic focus areas, namely: (A) Promoting Job Creation by the Private Sector; (B) Strengthening Human Capital; and (C) Promoting Inclusive and Resilient Territorial Development. The CPF has Governance and Citizen Engagement as its foundational pillar, as well as two cross-cutting themes: Gender and Digital Technology.
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(Report # 131039-MA), has been readjusted to support the country in its focus on Relief, Restructuring, and Resilient Recovery.
Impact of the COVID-19 pandemic on Morocco and government response:
22. The Moroccan economy is expected to be severely impacted by the COVID-19 crisis impact on both domestic economic activity and external demand. Real GDP is projected to contract by 6.3 percent in 2020 in the baseline scenario, a sharp contrast to the 3.6 percent expansion projected before the outbreak. Few sectors have been spared but the contraction is primarily driven by a drop in the production of goods and services, a reduction in exports, the disruption of global value chains, as well as a decline in tourism due to travel restrictions and border lockdowns.
23. The labor market is facing a shock of historical proportion, with vulnerable workers, including those in the informal sector being particularly affected. Enterprises have faced disruption of value chains, workers’ mobility, temporary closures as well as slowing global demand. The combined negative effects have led to widespread job and income losses – already at the end of April 2020, one third of households had lost their source of income. Albeit economic activity estimates are likely going to be on the conservative side, early projections by the Bank pointed to an additional 10 percent of the entire population (more than three million people) to become vulnerable to falling into poverty.
24. Morocco’s twin deficits are projected to deteriorate but remain manageable. Despite lower imports, the current account deficit is expected to widen to 6 percent in 2020 reflecting sharp declines in export and tourism revenues. On the fiscal side, revenue will be lower than previously expected in 2020 and 2021 while expenditures are projected to increase in 2020 on the back of additional spending on health, social protection, and other COVID-19 policy responses. As a result, we expect the overall fiscal deficit to widen to 7.5 percent of GDP in 2020, almost 4 percentage points larger than projected pre-COVID-19. Both public and external debt are projected to rise but will remain sustainable.
25. GoM’s response to date has been swift and decisive. In addition to quickly closing borders, building, and strengthening the health system, GoM has created a high level COVID-19 watch committee (Comité de Veille Economique, CVE) to monitor the situation and formulate policies and measures to support impacted sectors. The WB is supporting the CVE with just-in-time policy notes and analysis for targeted sectors. A special COVID-19 Pandemic Fund13 has been created to support economic recovery of impacted sectors as well as cash payments to households. The Pandemic Fund aims to reach over 5 million people and households (950,000 formal sector workers affiliated to the National Social Security Agency and 5.5 million workers operating in the informal sector). Health, private sector support and safety net support measures have been put in place. These include short-term work arrangements, social security tax reductions, and extension of credit to private sector enterprises. Safety net measures are being put in place with additional cash payments for beneficiaries of large social programs and extension of such measures to the informal sector. GoM’s response also included the preparation of a Revised Finance Law, the first in 30 years, which was adopted on July 7, 2020 with three main pillars: (i) support from the government and other institutions for the gradual recovery of economic activity, (ii) preservation of jobs, and (iii) acceleration of administrative reforms.
26. WBG support for responding to the crisis: WBG current engagement has been adjusted according to the three phases of Relief, Restructuring, and Resilient Recovery, and the FY21 pipeline was reprioritized to free-up lending space to align with the priorities specified below:
1. Support to health for saving lives threatened by the virus: An additional financing and a restructuring of a Health Support PforR (US$35 million) aiming at strengthening case detection, surveillance and case management were approved by the Board on June 16, 2020. In addition, a Development Policy Financing
13 Budget and public enterprises (67%), banks (10%), the private sector (13%), and others (10%) contribute to the Fund.
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(DPF) with a Catastrophe Deferred Drawdown Option (Cat DDO) was restructured to include a health-related catastrophe trigger and as a result, US$275 million were disbursed on April 3, 2020 [Relief].
2. Protecting the poor and vulnerable: One line of support includes the Financial and Digital Inclusion DPF series. The first of this series (US$500 million) was approved by the Board on June 22, 2020. The operation had been planned before the onset of the COVID-19 pandemic but was adjusted to respond to urgent needs. As such, the first DPF included policy measures for establishing the special COVID-19 Pandemic Fund that finances cash transfers to formal and informal sector employees and households [Relief]. It also included the development of a digital ID to facilitate financial inclusion and the expansion of social protection programs [Restructuring], a regulatory reform for the development of inclusive insurance [Restructuring and Recovery], and an expansion of access to broadband connectivity of underserved urban and rural areas [Restructuring and Recovery]. The planned Morocco Covid-19 Social Protection Emergency Response project (FY21, Q2) would support the Government’s safety net response while also laying the foundation for a more comprehensive and inclusive income transfer program which the King announced in August 2020.
3. Ensuring sustainable business growth and job creation: The WB has restructured the Financing Innovative Startups and SMEs Project to support startups and incubators that are hard hit by the pandemic [Restructuring and Recovery]. As the COVID-19 crisis is expected to increase firms’ reliance on digital services, the Financial and Digital Inclusion DPF (see above) promotes access to global digital services, crowdfunding for innovative startups and cashless payments [Restructuring and Recovery]. To address the constraints to access to finance due to the pandemic, the DPF also supports reforming the legal framework for minority investors protection and investment in small businesses [Restructuring]. Finally, the DPF supports the reform of the regulatory framework for e-procurement and the participation of Small and Medium-Sized Enterprises (SMEs), self-entrepreneurs and cooperatives in public procurement [Relief, Restructuring and Recovery].
4. Strengthening policies, institutions, and investment for rebuilding better: The WB is supporting this pillar through its support to the CVE (see above) as well as various ministries by providing analytical work and data analytics; as well as through support to the reforms to promote competition and investment in the digital infrastructure markets [Restructuring and Recovery] and to the reforms of public procurement (mentioned above) [Relief, Restructuring and Recovery]. Several of the planned FY21 operations have assumed higher importance in the current COVID-19 and post-COVID-19 circumstances – including the Urban Transport Program-for-Results Additional Financing recently approved by the Board (supporting urban public transport capacity which will be key for a safe return to urban movements) and the Green Generation PforR which is presented in this document.
27. Selectivity, complementarity, partnerships: Morocco’s partner countries and organizations are making a joint effort to support the country during this crisis. A group of financing partners – African Development Bank (AfDB), European Investment Bank (EIB), AFD, Kreditanstalt fuer Wiederaufbau (KfW), EU, European Bank for Reconstruction and Development (EBRD) - has been meeting regularly since the beginning of the pandemic to discuss complementarity of support. The WBG is conducting socio-economic monitoring analytics with the United Nations Development Program (UNDP) and has recently published an economic monitor with a special focus on the impact of the COVID-19 crisis. On April 7, 2020, Morocco drew US$3 billion of available resources under a Precautionary and Liquidity Credit Line with the International Monetary Fund (IMF), thereby bolstering their official reserves and supporting economic stability. Further, the authorities are mobilizing an additional (non-programmed) US$1 billion in bilateral and multilateral support in 2020 compared to their pre-COVID-19 plans from international financing institutions (WB, AfDB, EBRD, EIB, Islamic Development Bank, Arab Monetary Fund) as well as bilateral agencies (KfW, AFD) and the EU.
Financing Needs and Sources of Financing: Overall, Morocco’s financing needs in 2020 amount to US$18.5 billion of which US$12 billion are domestic, and US$6.5 billion are external. Sources of external financing include bond financing as well as support from bilateral and international sources. IBRD financing in 2020 is estimated at 1.3 billion.
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28. The proposed operation contributes to the 2019-2024 CPF for Morocco. It is aligned with its Strategic Focus Area A (Promoting job creation by the private sector) and Strategic Focus Area C (Promoting inclusive and resilient territorial development). Specifically, it would support its Objective 2 (Increase opportunities for private sector growth with a focus on MSMEs and youth employability) as well as its Objective 10 (Strengthen adaptation to climate change and resilience to natural disasters). Under Objective 2, the CPF foresees crowding-in the private sector to generate further growth and job opportunities. Under Objective 10, the CPF envisages support to climate adaptation and resilience in sectors threatened by climate variability and change. Yet, the activities of the operation would also indirectly touch upon Strategic Focus Area B (Strengthening human capital), as the Program aims at building, strengthening and protecting human capital by extending academic curricula and developing digital extension services. Given the strong focus on gender and digital technologies in the Program, the cross-cutting themes “Gender” and “Harnessing Digital Economy for Jobs and Faster Growth” would equally be broadly covered.
29. The proposed operation is well-positioned to contribute to the Middle East and North Africa (MENA) enlarged Regional Strategy on Economic and Social Inclusion for Peace and Stability. In particular, the Program is aligned with the pillar on renewing the social contract as it emphasizes more inclusive economic growth and the protection of natural resources which are considered public goods to be preserved as part of the intergenerational social contract, and the pillar on strengthening resilience to shocks, such as climate shocks. The Program is also aligned with the strategy focus on youth, entrepreneurship, and technologies. In particular, the Program contributes to: human capital development and digital transformation. With respect to human capital development, the Program focuses on improving the quality of extension services. With respect to digital transformation, the Program aims at improving skills for youth and women, supporting entrepreneurship and SMEs and improving contestability in markets, including via disruptive technologies. The regional strategy has an equally strong focus on gender equality and female empowerment, which is well reflected in the operation. The Program also supports the Resilient, Inclusive, Sustainable and Efficient (RISE) approach to the post-COVID-19 recovery.
D. Rationale for Bank and AFD Engagement and Choice of Financing Instrument
30. The World Bank has been engaged in the agricultural sector in Morocco for almost three decades and it has supported the PMV since its inception, through policy and institutional reforms along with investments. This included: (i) a DPF series in support of the PMV (2011 to 2014, US$408 million) with a focus on institutional and regulatory measures to improve the efficiency of domestic markets by reducing marketing costs and improving marketing services through the modernization of wholesale markets and slaughterhouses; improve the effectiveness of the agricultural innovation system; and establish an effective food safety management systems; and (ii) two investment operations (Modernization of Irrigated Agriculture in Oum Er Rbia Basin Project, 2010-2017, US$70 million– P093719; Large Scale Irrigation Modernization Project, 2015-2022, US$150 million– P150930) with a focus on improving water service to small farmers in large scale irrigation perimeters as a prerequisite to the adoption of improved irrigation technologies and to the increase in agricultural water productivity. Furthermore, a PforR supporting the PMV (2018-2022, US$200 million – P158346) aims to increase the volume of added-value products commercialized in the olive and citrus agri-food value chains. In addition, the sustainability of the agricultural sector in rainfed marginal areas has been addressed through two dedicated grants by the Global Environmental Facility (GEF): the Integrating Climate Change in the Implementation of the Plan Maroc Vert Project (2010-2015, US$4 million – P117081); and the Social and Integrated Agricultural Project (2013-2017, US$6.44 million – P129774) focusing on climate change adaptation, biodiversity and land conservation. The proposed operation would complement and build on these earlier interventions by putting a stronger focus on equity, job creation and resilience/environmental sustainability in agricultural value chains, while also ensuring the sustainability of the investments made in earlier projects/programs, in particular the Irrigation Investment Project Financing (IPF) which has initiated major changes in the irrigation sector (conversion to drip irrigation) that require long-term technical support.
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Furthermore, the Bank has been increasingly engaged in supporting the digital transformation, and more specifically is gaining broader experience in promoting the adoption of digital technologies to improve the provision of agriculture services, supporting the growth of the ag-tech innovation ecosystem, and assisting in responding to new challenges such as those created by the current COVID-19 pandemic. The ongoing DPF series14 is further supporting the development of the digital economy and strengthening digital foundations, including support to improve mobile broadband in rural and urban areas. The reforms supported will create the enabling environment for the activities carried out in this operation.
31. The AFD has also been a major partner of the GoM in the agricultural sector, providing continuous support to the country’s successive agricultural strategies. The AFD contributed to the PMV implementation through a series of projects covering several complementary dimensions, with a focus on smallholders’ needs and their adaptation to climate change. Hence, the AFD supported: (i) the Pillar II of the PMV through the financing of sub-projects supervised by ADA (Programme d’Appui au Pillier II du Plan Maroc Vert, PAPMV project); (ii) the development of several irrigation schemes aiming at improving access to irrigation and water use efficiency (Projet Moyen Sebou-Inaouen Aval and Projet de Developpement de l’Irrigation et d’Adaptation de l’Agriculture Irriguee aux Changements Climatiques); (iii) the adaptation of rain fed agriculture to climate change through awareness raising on the impacts of climate change and the development of a specific insurance for drought (ACCACRIMAG project); and (iv) financial inclusion of smallholders through the development of tailored credit solutions with the CAM (Tamwil El Fellah project). In addition, the AFD is supporting GoM in its efforts for reducing gender inequalities in the public administration, through the implementation of annual gender-responsive budgeting for every ministry—including MAPMDREF. This broad experience in the sector and the continuous constructive dialogue with MAPMDREF positioned AFD as a key partner for the implementation of the first steps of the GGS.
32. The GoM is now seeking support from the World Bank and AFD for the implementation of the new GGS (2020-2030). Despite the impressive performance in terms of increasing overall agricultural production under the PMV, some challenges remain, which the Government is seeking to address under the GGS with support from the World Bank and AFD. A key challenge is to further increase job creation, opportunities for youth in the rural space, and promote the integration of smallholder farmers in mostly rainfed, fragile agro-ecological zones, in higher value markets and agricultural value chains. Employment creation for the youth and creation of entrepreneurship opportunities in the rural space is a high priority on the Government’s agenda across sectors, with a critical role envisioned for the agricultural sector. There is a strong political commitment to that agenda. Furthermore, the GoM has demonstrated its commitment to results and reforms through the implementation of the PMV and the development of the new agricultural successor program (GGS) launched on February 13, 2020. During the preparation of the CPF 2019-2024, MAPMDREF has continuously asked for the support of the World Bank to strengthen its agricultural sector, help design its new agricultural strategy and support its implementation. Its request stressed specifically three aspects: youth inclusion, digital technologies and CSA. The World Bank Group is well positioned to accommodate this request considering: (i) its extensive international experience in developing inclusive and resilient value chains and supporting agribusiness development, and (ii) previous support to the PMV. Building on the successful collaboration between MAPMDREF and AFD, the GoM has requested AFD to support the GGS on two different levels: at the central level, through this PforR, and at the regional level for two to three regions (Fes-Meknès, Oriental, Souss-Massa). This integrated approach is carried out as part of the program « Revitalisation des Territoires Ruraux marocains par l’Emploi et l’Entrepreneuriat dans le secteur Agricole et para-agricole (TREEA) » that AFD is preparing in parallel to this PforR with MAPMDREF and in coordination with the World Bank.
33. A PforR instrument is best suited to support the implementation of the new agricultural strategy. In selecting this instrument, the following factors were taken into consideration: (i) the proposed operation would support ongoing
14 Financial and Digital Development Policy Financing (P171587—first operation in a series of 3).
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institutional reforms and focus on implementing the ‘Green Generation’ program which is the successor program of the PMV, (ii) the proposed operation would strengthen existing Government systems for the implementation of the GGS, (iii) the proposed approach would be programmatic, including a mix of transversal activities benefitting all subsectors, and (iv) the proposed instrument would support MAPMDREF’s continued focus on strategic outcomes. Furthermore, the Program seeks to develop partnerships with other donors supporting the new agricultural strategy. The achievements of the PMV to date and the newly developed agricultural strategy provide a robust foundation for the proposed Program. Furthermore, the very solid implementation by MAPMDREF of the ongoing PforR on Strengthening Agri-Food Value Chains (P158346, FY18) has increased the interest of the GoM in this instrument.
34. The PforR would also allow to harmonize World Bank and AFD support to the GGS. In accordance with the new Joint Partnership and Co-Financing Agreement signed on June 13, 2018, by the World Bank and the AFD, the AFD would align part of its future intervention aiming at supporting the GGS at central and regional levels, with the procedures of the World Bank. The World Bank and AFD would thus co-finance (through the formalization of two loan agreements with GoM) one single Program to support the GGS at the central level, with the same supervision and disbursement procedures. In accordance with the provisions set forth in the “Cofinancing Framework Agreement” the World Bank would lead implementation support, working in close consultation with AFD.
II. PROGRAM DESCRIPTION
A. Government Program
35. The GGS launched in February 2020 by King Mohamed VI is the Government program for the agri-food sector. This strategy is predicated on the adoption of a new vision for the agricultural sector, new governance arrangements and the provision of modern tools for agricultural development. Furthermore, with the COVID-19 crisis, the GGS is expected to be instrumental to the recovery and resilience of rural populations15. It is based on two overarching strategic orientations, namely: (i) priority to the human element through the emergence of a new generation of rural middle class (350,000 to 400,000 households), the advent of and support to a new generation of young entrepreneurs, notably through the mobilization of one million hectares of collective land, the emergence of a new generation of agricultural organizations supported by efficient inter-professions (inter-professional organizations), and the implementation of a new generation of support mechanisms; and (ii) the sustainability of agricultural development through the consolidation of the performance of agricultural value chains, with a view to doubling exports and agricultural GDP by 2030, and the improvement of product distribution processes through the modernization of wholesale markets. The strategy also lays the groundwork for strengthening the resilience and sustainability of agricultural development, as well as improving the quality and capacity for innovation. The implementation of this strategy will require an annual increase in the sector’s budget of almost 2.5 percent as of 2020. The GGS will be implemented over 2020-2030 period, in particular at the territorial level, according to the comparative advantages of each region, in coordination with all stakeholders, and in accordance with the principles of good governance, with close monitoring and evaluation of investment activities as well as production efficiency and yield indicators.
36. The GGS is the natural continuation of the PMV launched in 2008 with the objective to further modernize and foster the growth of the agri-food sector. The findings of the 2018 review of the results achieved under the PMV16 were incorporated into the design of the GGS program. The review was carried out by MAPMDREF and quantified implementation progress with respect to agricultural output growth and value added, yields, exports, job creation, as
15 In his speech dated October 9, 2020, King Mohamed VI highlighted agriculture as a key driver for the economic recovery from the COVID-19 outbreak. 16 Évaluation du Plan Maroc Vert, Synthèse des Réalisations 2008-2018 (MAPMDREF, 2020)
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well as the PMV’s transversal reforms. Considering the projected growth in production resulting from the investments made during the first phase of the PMV (2008-2018), the review recommended a shift in emphasis towards the rural youth as bona fide investors, the promotion of investments in value-addition, agri-food processing and a greater focus on market diversification. Hence, like its predecessor program, the GGS aims to transform the agri-food sector into a key source of economic growth that contributes to employment creation and poverty reduction in rural areas, enabling the emergence of a rural middle class, while promoting the sector’s integration into the global economy, and helping the sector adapt to climate change. The GGS program includes a set of transversal intervention areas, as well as an investment support program based on public-private partnerships. The GGS also builds on the agricultural development plans endorsed by each region.
37. The GGS covers a twin set of eight strategic intervention areas. (i) Human element: i.e., support to new generations of: (a) Agriculture middle class: expanded and targeted incentives to improve incomes, enhanced social protection and status of farmers, and improvement of the Guaranteed Minimum Agricultural Wage (Salaire Minimum Agricole Garanti, SMAG) and working conditions; (b) Young agricultural entrepreneurs with a focus on providing entrepreneurship grants for rural youth, assistance to start up and develop farming, and training and professional qualification; (c) Agricultural organizations based on pursuing structuring, regrouping and aggregating farmers around efficient agricultural organizations, and the strengthening and empowerment of the sector’s professional organizations; and (d) Support mechanisms related to agricultural advisory services, improved access to digital agricultural services and new community farming projects; and (ii) Sustainability of agricultural development: (a) Consolidation of agricultural value chains with an emphasis on continued investment efforts, streamlining upstream incentives to value chain development, accelerating the process of value addition of agricultural products, support to the emergence of new sectors with potential and enhanced export competitiveness; (b) Modern and efficient trade and distribution channels: modernizing distribution channels to maximize the value captured by farmers and improve the quality of products sold to end-consumers, and improving access to high value export markets; (c) Quality, innovation and Green-Tech: Improved product quality and food safety, diffusion of innovation, precision farming and investments in R&D; and (d) Resilient and eco-efficient agriculture: pursuing water mobilization and saving programs, including the promotion of on-farm drip irrigation and disseminating soil conservation techniques. The quantitative targets assigned to each area are presented in Box 4 below.
Box 4. Green Generation: Program Intervention Targets
- New generation of rural middle class: 350,000 to 400,000 households entering in the middle-class and 3-4 million farmers covered by social security programs;
- New generation of young agri-entrepreneurs: 1 million hectares of collective land being used (of which 25 percent by the youth), 350,000 farmers and agri-entrepreneurs (180,000 new youth entrepreneurs and creation of 170,000 jobs in agricultural and para-agricultural services) and 150,000 youth being trained;
- New generation of agricultural organizations: fivefold increase of the number of cooperatives/professional organizations and 30 percent of public budget related to agriculture managed by professional organizations;
- New generation of support ecosystems with two million farmers being connected to e-services and 5,000 additional agricultural advisors;
- Consolidation of agri-food value chains: twofold increase each of agricultural GDP and exports, and processing of 70 percent of total agricultural production;
- Modern and efficient supply chains, with 12 wholesale markets and local market (souks) modernized; - Quality, innovation and green tech: certification of 120 slaughterhouses and twofold increase of food safety controls; and - Resilient and ecologically efficient agriculture, with the aim to double hydrological efficiency and improve soil conservation.
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B. Program Development Objective (PDO) and PDO Level Results Indicators
38. The Program Development Objective is to increase the economic inclusion of youth in rural areas and the marketing efficiency and environmental sustainability of agri-food value chains in the Program area. The Program will thereby contribute to the broader, higher level objectives of the GGS, which are to boost investments in the agri-food sector, increase the sector’s value added and agri-food exports, create additional jobs, and raise rural incomes—with a strong environmental sustainability and climate resilience lens.
39. The PDO results indicators are: (i) number of young people who have created agriculture-related enterprises that have been operational for at least six months (percent of whom are women); (ii) quantity of local products marketed through wholesale marketing platforms; and (iii) number of producers adopting climate smart practices (percent of whom are women).
C. Program Scope and Description
40. The Program’s scope and boundaries are predicated on the following considerations:
(i) The Program would be aligned with the recommendations of the final review of the PMV, particularly those emphasizing agri-food value chains development. Substantial progress has been achieved at the farm level under the PMV, in terms of increasing production and productivity, however important bottlenecks remain to be addressed beyond the farm gate. The Program would support and help improve GGS interventions that address those bottlenecks, in order to create new market opportunities and drive further investments in the sector.
(ii) The Program would apply the Mobilizing Finance for Development (MFD) principles and seek to attract private investments in the agri-food sector by improving selected regulations, instruments and programs, impacting private finance in the sector.
(iii) The Program would selectively support interventions that have the potential to accelerate the broader transformation of the agri-food sector towards greater added-value and inclusion of small and medium producers, including through measures to increase revenue generation by rural youth; the reform of wholesale markets; the use of digital technologies for producers’ access to information on production technologies and markets; the promotion of commercial partnerships between small producers and buyers; and strengthening the ecosystem for digitalization of CSA practices and agribusiness development.
(iv) The Program interventions would be focused on key areas of the GoM’s program where the Bank’s global experience can be brought in to improve existing instruments and continue the reform efforts supported under the earlier DPF series.
(v) The Program would serve as a leverage to facilitate multi-stakeholder dialogue and reforms. It was designed with the vision to provide a platform to facilitate dialogue and accelerate the implementation of reforms in areas that require good intra-governmental coordination as well as public-private partnerships (such as the wholesale market reforms, and the implementation of the food safety control system).
41. The Program would focus on three key areas of the GGS that are inherently interdependent: (i) Increased job opportunities and income generation for rural youth; (ii) improved efficiency of agri-food marketing systems; and (iii) enhanced digitalization of agriculture and adoption of climate-smart practices, as well as strengthened monitoring and evaluation (M&E) capacity of implementing agencies. The Program would support the incentive schemes and ecosystem with a focus on enabling the private sector to provide digital and climate smart technologies and getting farmers and agri-food SMEs to adopt these technologies. Increased adoption of these technologies is expected to transform the Moroccan agri-food sector and contribute to reaching the higher-level objectives of the GGS: (i) valorization of the human
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capital through the creation of a new rural middle class and support to a new generation of young entrepreneurs for the creation of jobs in rural areas (especially for the youth and women); and (ii) sustainability of agricultural development, through consolidated agri-food value chains and strengthened resilience to climate change. The Program would also contribute to investments for green channels and digital transformation which are important to mitigate the impact of the current COVID-19 pandemic (and prepare for future similar crises).
42. Program beneficiaries. While some of the Program’s activities would benefit a broad range of stakeholders in the agri-food sector, the Program would include activities specifically aimed at promoting the inclusion of young people in agriculture-related entrepreneurial activities, and small and medium producers and enterprises with modern value-chains, including their capacity to produce and commercialize value-added products. Direct Program beneficiaries would include young people in rural areas, small and medium producers and enterprises engaged in the agri-food sector (of which 25 percent are female). Those beneficiaries and a broader range of stakeholders would also benefit from the increased efficiency of wholesale markets, the development of innovations in digital agriculture and improved food safety and quality. Those beneficiaries would include enterprises in the agri-food sector, such as aggregators, traders and exporters, as well as Moroccan consumers, who will benefit from safer and better-quality products. It is estimated that approximately 200,000 agri-food producers and entrepreneurs would benefit from one or more of the Program activities in the regions included in the Program area. Finally, the Government agencies involved in the Program (MAPMDREF, ONCA, ONSSA, ADA, Morocco Foodex, IAV, INRA, DRAs17, and ORMVAs18) would benefit from increased capacity to implement their mandates and to monitor and evaluate the results of their respective programs.
43. Table 1 below summarizes the content of the GGS program, key achievements to date under the predecessor PMV program, and outstanding issues as well as the scope of the proposed Program. It also stresses the links with the ongoing Strengthening Agri-food Value Chains PforR. The Program would support selected activities of the eight areas of intervention of the GGS over a five-year period (2021-2025). The Program geographic area would include: (a) the regions of Béni Mellal-Khénifra, Casablanca-Settat, Drâa-Tafilalet, Fès-Meknès, Marrakech-Safi, Oriental, Rabat-Salé-Kénitra, Souss-Massa and Tanger-Tétouan-Al Hoceïma; and (b) the provinces of Guelmin, Tan-Tan and Sidi Ifni.
Table 1: Key attributes and scope of the Program
Attributes Green Generation 2020-2030 PforR
Development objective
The Green Generation Strategy 2020-2030 aims to reach a new level of development in Moroccan agriculture, by capitalizing on the achievements made by the PMV, through: (i) a new development vision, (ii) the adoption of a new governance, and (iii) the provision of modern means for the agricultural sector.
The PforR aims to increase the economic inclusion of youth in rural areas, and the efficiency and environmental sustainability of agri-food value chains, to be achieved under three Result Areas (RA):
− RA 1: Increased job opportunities and income generation for rural youth.
− RA 2: Improved efficiency of agri-food marketing systems.
− RA3: Enhanced digitalization of agriculture and adoption of climate-smart practices.
17 The Directions Regionales de l’Agriculture (DRAs) are the deconcentrated entities of MAPMDREF in the different regions. 18 The Office Régionaux de Mise en Valeur Agricole (ORMVAs) are autonomous agencies tasked with developing the potential of agricultural land through constructing new irrigation schemes and rehabilitating and modernizing existing ones; ensuring Operation and Maintenance (O&M) of irrigation and drainage facilities; and providing irrigation advisory services to farmers.
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DO Indicators Deliver the following results, by 2030 and compared to 2020: (i) up to 400,000 households entering the middle class, with 3 to 4 million farmers with social protection; (ii) one million ha of collective land developed, with 350,000 new farmers and agricultural entrepreneurs and 150,000 young people trained; (iii) up to 70 percent of production undergoing processing; (iv) up to 2 million farmers connected to agricultural e-services; (v) up to twice the level of agriculture GDP and agricultural exports; and (vi) up to twice the level of water efficiency.
− Number of young people who have created agriculture-related enterprises that have been operational for at least six months (percent of whom are women)
− Quantity of local products marketed through wholesale marketing platforms;
− Number of producers adopting climate smart practices (percent of whom are women)
Period 2020 - 2030 2021 – 2025
Global Budget US$10 billion US$487 million equivalent
Intervention Area
Strategic Initiatives Keys Achievements Outstanding Issues Proposed Program
IA1: New generation of agricultural middle class
− Expanded and targeted incentives to improve incomes;
− Enhanced social protection and status of farmers;
− Guaranteed Minimum Agriculture Wage (SMAG) and working conditions;
− Reform of the system of assistance and incentives for agricultural investment;
− Improvement of agricultural insurance coverage.
− Limited access to finance and / or land for young people wishing to develop their agricultural enterprises
IA2: New generation of young agricultural entrepreneurs
− Entrepreneurship grants for rural youth;
− Assistance to start-ups;
− Training and professional qualification.
− Various policies carried out in recent years by the State (INDH, Mokawalati, support for young entrepreneurs, Taahil, and Idmaj) to promote and support youth entrepreneurship
− Implementation of several programs and projects, co-funded by donors and Non-Governmental Organizations (NGOs), to stimulate and support rural youth entrepreneurship (ex. PEJ, PJEA, ALEF)
− Entrepreneurial skills limited among youth
− Lack of awareness by young people of investment opportunities in rural areas
− Weak support structures for entrepreneurship in rural areas
− Limited access to finance and / or land for young people wishing to develop their agricultural enterprises
− Improving the attractiveness of the rural economy for young people
− Identification and communication regarding opportunities by region in favor of young people
− Reinforcement of the support system for agricultural entrepreneurship
− Improvement of the financial support system for agricultural entrepreneurship (targeted incentives for youth)
IA3: New generation of agricultural organizations
− Structuring, regrouping and aggregating farmers around efficient agricultural organizations;
− Strengthening and empowerment of the professional organizations.
− Specific legal framework governing agricultural and fishery inter-professions (Law 03-12 and attendant texts);
− Public Private Partnerships (PPPs or Program Contracts) by sector;
− Support for strengthening inter-professions;
− Partnership and contractual arrangements for the implementation of sectoral and territorial development policies.
− Insufficient and irregular financial resources of inter-professions to carry out their missions (interprofessional agreements in progress);
− Insufficient organization of certain sectors.
− Not covered by the PforR—the strengthening of inter-professions is already covered by the ongoing Strengthening Agri-food Value Chains PforR
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IA4: New generation of support mechanisms
− Reform of agricultural advisory services;
− Improved access to digital agricultural services;
− New generation of community farming projects.
− Strengthening of private contractual agricultural advice;
− Several successful experiences in the digitalization of services and management processes in place (ASAAR, ARDNA, SABA, CGMS-MAROC, and FERTIMAP);
− Reinforcement of financial support mechanisms (ex. FDA)
− Poor access to information, training and support services;
− Weak synergies and knowledge sharing between the various digitalization initiatives;
− Insufficient digital systems, information gathering devices and decision-making tools
− Definition of a national scheme for the exchange of agricultural information (unifying project);
− Implementation of digital systems, information gathering devices and decision-making tools;
− Digitization of agricultural advisory services (Digi-Conseil)
IA5: Consolidation of agricultural value chains
− Maintain the investment effort and streamline incentives upstream of the value chains
− Accelerate processing and value addition of agricultural products
− Support the emergence of new sectors with high potential
− Support export competitiveness
− Support for investment and integration of small and medium producers in markets;
− Support for the development of agricultural product value addition;
− Weak value addition of agricultural products.
− Not covered by PforR: support for investment in processing units provided under the ongoing Strengthening Agri-food Value Chains PforR
IA6: Modern and efficient distribution chains
− Structure and modernize distribution channels to maximize the value captured by farmers and improve the quality of products sold to end-consumers;
− Develop agricultural exports.
− Preparation of the master plan for wholesale fruit and vegetable markets;
− Identification of a new management model for wholesale markets;
− Liberalization of the domestic red meat market;
− Strengthening of Morocco Foodex's intervention to improve the efficiency and control of agri-food exports;
− Support to organizations of producers for the marketing of their local products.
− Inadequate regulatory framework governing the wholesale fruit and vegetable markets;
− Non-compliance of wholesale marketing facilities with international standards;
− Recurrent deficiencies in municipal slaughterhouses regarding hygienic and sanitary conditions as well as management efficiency;
− Long delays in carrying out technical export control operations for fresh products;
− Insufficient monitoring of export markets;
− Limited marketing outlets for local products.
− Promulgation of a new legal and regulatory framework governing the wholesale marketing of agricultural products;
− Development of four new wholesale markets with an innovative delegated management model;
− Digitization of export control;
− Development of online commerce for local products.
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IA7: Quality, innovation and Green-Tech
− Improved product quality;
− Diffusion of innovation, R&D and precision farming;
− Investments in R&D.
− Reinforcement of sanitary control of food (normative framework for several sectors and inspection and control activities.)
− Several successful projects in innovation and green tech (INRA, IAV, and Mohamed VI Universities).
− Insufficient investments in R&D;
− Low use of digital platforms for precision agriculture;
− Low use of digital tools.
− Launch of a national call for pilot projects for the identification of innovative project leaders (digital and climate-resilient);
− Implementation of digital platforms for precision farming based on artificial intelligence;
− Use of drones for phytosanitary treatments.
− Increased number of agro-food firms authorized by ONSSA.
IA8: Resilient and eco-efficient agriculture
− Continuation of water mobilization and saving programs;
− Dissemination of soil conservation techniques.
− PNEEI;
− Realization of several projects focused on climate-smart agriculture (rehabilitation of “khettaras”—traditional irrigation structure— and collective conversion to localized irrigation).
− Risk on the sustainability of investments made in terms of modernization of irrigated areas for water saving
− Technical assistance to support farmers in modernized irrigation sectors;
− Support for the development of pilot projects, based on the principles of ecological and organic farming, in vulnerable and fragile areas, particularly the unfavorable Oasis, mountain and marginal village areas.
44. Result Areas. The PforR draws on selected activities of the GGS program, with a focus on the three following interlinked Areas (see Annex 3 for a detailed description).
RESULT AREA 1 – INCREASED JOB OPPORTUNITIES AND INCOME GENERATION FOR RURAL YOUTH
45. Many promising dynamics support the growth of the agricultural sector and the rural economy in Morocco—supply-side advantages, untapped markets, rising export opportunities, and policy support; yet, significant constraints, if not addressed, can weaken the sector’s prospects and further marginalize the rural youth. These youth often lack technical skills, managerial capacity and knowledge of business processes to create their enterprises or enter the job market. Their performance is further limited by their lack of access to finance. Result Area 1 aims to address these constraints holistically with the objective of increasing job opportunities and incomes of the youth in rural areas which will also reduce out-migration from rural areas, exacerbated by climate change, and enhance the financial ability and climate knowledge of young entrepreneurs and producers to undertake the necessary adaptation and mitigation actions. This would be achieved through the following two interlinked sub-programs: (i) strengthening the ecosystem for rural entrepreneurship development; and (ii) facilitating access to financial resources for young rural entrepreneurs to start their agri-enterprises and/or pursue other agriculture-related services. All the activities developed as part of Result Area 1 would be instrumental in spurring the economic and climate resilience of the rural youth in the wake of the COVID-19 pandemic. The provision of viable agricultural livelihoods and the development of climate change-informed business plans would increase climate change resilience and reduce youth out-migration from rural areas due to lack of opportunities and the adverse impacts of climate change. Success for Result Area 1 would be measured based on the number of businesses created and pursued by the youth. Result Area 1 will be key to generating a supply of innovative firms that will then provide solutions for Result Areas 2 and 3.
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46. Strengthening the ecosystem for rural entrepreneurship development. Under this sub-program, the Program would aim to improve the attractiveness of the rural economy for young people (with specific attention to women) through the provision of specialized technical assistance and to strengthen the capacity of relevant support institutions (both public and private) to raise the quality of their services and/or develop new services (leveraging digital and climate smart agriculture technologies) in response to the needs of young rural entrepreneurs (particularly women) and market trends. It would also finance the provision of standardized, quality technical services to selected rural youth to help them prepare “bankable” business plans and support their implementation. Awareness raising about climate change mitigation and adaptation strategies will be provided to inform the business plans.
47. Improving the attractiveness of the rural economy for young people. The Program would fund the provision of specialized technical assistance to: (i) identify new and build on existing economic opportunities in priority agri-food value-chains at provincial level, targeting both local and export markets and ensuring a more equitable inclusion of women in the agri-food sector; (ii) organize communication and promotion campaigns related to these economic opportunities at national and provincial levels, using different channels (media, promotion tours, seminars, and open house days)—these campaigns targeted at rural youth would ensure a strong participation of female entrepreneurs and rural women in the Program and build awareness of climate change issues; (iii) develop and integrate rural entrepreneurial training modules in vocational training centers and training of trainers in entrepreneurship; (iv) organize orientation and ideation sessions for young people to increase climate literacy and investigate potential economic opportunities in their areas and available support services (targeting 90,000 young people) with 25 percent of these sessions dedicated to young female entrepreneurs, and another 25 percent dedicated to finding solutions for closing the gender gap in agri-food value chains; and (v) pilot a national call for projects, including two competitions to select 40 young promoters of digital and climate smart agricultural projects and support them in starting their projects (the two competitions will serve closing the gender gap in agri-food value chains, at least 10 of the 40 selected young entrepreneurs will be women). The rural entrepreneurial training combined with access to finance (see below) would provide improved livelihoods and strengthen the climate resilience of vulnerable groups.
48. As part of the rural entrepreneurship development activities, the Program would finance the provision of standardized, quality technical services to selected youth, including a dedicated technical assistance to help the youth, particularly women, prepare “bankable” (and climate-informed) business plans and subsequent commercial loan applications, leveraging credit access programs. This intervention is expected to benefit 10,000 youth.
49. Strengthening the capacity of relevant support institutions for rural entrepreneurship development. The Program would finance the following activities: (i) capacity building of a pool of highly qualified agricultural advisers, focusing particularly on the needs of women; (ii) revitalization and professionalization of agricultural cooperatives to improve their operational capacities, climate knowledge, and modernize their management structure with an emphasis on empowering female cooperative members to play stronger managerial roles; (iii) establishment of 10 incubators within the Dar El Fellah network to enhance their outreach capacity so that they can provide last-mile services to young rural entrepreneurs, cooperatives and other agri-service providers; and (iv) launch of an initiative focused on the emergence and empowerment of agricultural service cooperatives for the youth to pilot state-of-the-art technologies geared to promoting digital applications, provide advance warning for emergency events, including climatic hazards, and ensure readiness at the grassroots level to address crises, such as the COVID-19 pandemic and climate-related events. The Program would support the creation of 10 such service cooperatives (hiring a total of 200 young people).
50. Facilitating access to financial resources for young rural entrepreneurs. The Program would finance the following activities: (i) review the Agricultural Development Fund (Fond de Développement Agricole, FDA) incentive system and legal framework to specifically target young rural entrepreneurs; this would involve the enactment of legal texts introducing incentives benefiting projects promoted by rural youth, including access to agricultural land; and (ii)
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implement financial incentive mechanisms for young people to: (a) start their individual projects (16,000 expected beneficiaries); (b) grow their projects into structured agricultural enterprises (800 service companies would receive incentives with up to 10 young people per company, implying 8,000 expected beneficiaries, 2,000 of whom would be women); and (c) support the access to agricultural land (14,500 expected beneficiaries, 3,625 of whom would be women). Among the objectives pursued, the Program will give: (1) adequate priority to initiatives predicated on eco-efficient and climate smart technologies, as well as technologies geared to reducing risk factors such as droughts, pest outbreaks or epidemics, and getting promoters equipped to face emergency events, such as the COVID-19 pandemic; and (2) due attention to projects developed by young women to reduce the gender gap, as they need targeted incentives to circumvent constraints related to their vulnerable status, and to have an even-playing field in seeking financial support. The empowerment of young women will in turn increase their climate resilience as women tend to be more exposed to climate risks compared to men due to fewer endowments and entitlements, they also have less access to information and services, and are less mobile. All three measures under (ii) would be in line with GGS guidelines, from year 3 of the Program, following prior adoption of related legal framework under (i).
RESULT AREA 2: IMPROVED EFFICIENCY OF AGRI-FOOD MARKETING SYSTEMS
51. The evaluation of the PMV carried out by MAPMDREF in 2018 indicates that sector performance is still hindered by marketing constraints, including limited capacity for product innovation, and difficulties accessing modern marketing networks, particularly for women. It also highlights the difficulty for small producers and SMEs to comply with stringent food safety, quality, traceability, labeling and environmental sustainability requirements imposed by high-value export markets. These constraints are affecting small producers’ ability to participate and benefit from the strong sector growth registered over the last decade. Limited access to modern marketing networks also results in high post-harvest losses, increasing the related carbon-footprint of farming and further exacerbates vulnerability to climate change. The difficulty to comply with stringent food safety, quality, traceability can also increase the incidence of foodborne diseases and the risk of spread of novel pests and diseases which are projected to be exacerbated as a result of climate change.
52. Result Area 2 aims at addressing these constraints through targeted investments to improve the efficiency of Morocco’s agri-food marketing systems. The expected outcomes are: (i) improved commercialization on the local markets; and (ii) increased exports of agri-products, which would result in improved linkages between producers and buyers, enable greater integration of producers into modern value-chains, and increase incomes of farmers. Specific emphasis will be put on addressing women’s constraints and strengthening their access to local and international markets and reducing climate vulnerability. Ensuring efficient and resilient food supply chains has been critical during the COVID-19 outbreak and will remain instrumental as the country is moving to the pandemic recovery but also to mitigate potential future similar crises. Result Area 2 will provide the necessary climate-proof and energy-efficient market infrastructure to facilitate the activities carried out in Result Areas 2 and 3. The Program would support the following three sub-programs in order to reach the stated objectives.
53. Strengthening agri-food products marketing and distribution in the domestic market. The Program would contribute to modernizing Morocco’s agri-food marketing infrastructure with a view to improving domestic market efficiency and transparency benefiting both farmers and end-consumers, building on the lessons learned from the Rabat wholesale market to be developed as part of the Strengthening Agri-Food Value Chains PforR (P158346). This would be achieved through the following four interlinked activities: (i) preparation and, if approved, enactment of the regulatory framework for the development of modernized wholesale markets: the associated texts will be subject to publication; the MI would oversee and implement the process; (ii) development of four modernized wholesale markets: this would involve financing related to engineering and financial feasibility studies, climate-proof and energy-efficient construction, equipment, and bringing the market facilities to full operational level for the cities of Meknès, Agadir, Marrakesh and Berkane; prior activities would comprise establishing a new management model for wholesale markets based on territorial partnerships with involved communes and regional authorities by putting in place management structures for
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the modernized wholesale markets, and preparing an Environmental and Social Impact Assessment (ESIA) of the National Wholesale Market Scheme (Schema National d’Orientation des Marches de Gros au Maroc) as well as Environmental and Social Management Plans (ESMP) and if applicable, Resettlement Action Plans (RAP), for each selected individual wholesale market. The establishment of management structures for each wholesale market would ensure a cost-efficient management by the private sector and contribute to their successful long-term operation. The Directorate for the Development of Value Chains (Direction du Développement des Filières de Production, DDFP) would oversee the process together with the collective of institutions affected, particularly the Wilayas and other territorial authorities; and (iii) development of e-commerce platforms for local products. This activity would support small producers, particularly women, and their cooperatives to market their products through a wide range of virtual stores and facilitate their integration into commercial value chains. This would put a strong emphasis on opening new avenues for income generation and better access to national and international markets for women. The Agence pour le Développement Agricole (ADA) will oversee the implementation of this activity. By developing an enhanced and energy-efficient market infrastructure, Result Area 2 would improve the overall resilience of agricultural value chains to climate change; it will also lead to reduced GHG emissions by spurring better logistical and energy efficiency overall.
54. The design of the wholesale markets would be cognizant of Eco-Industrial Park Guidelines19 with a focus on mitigating climate change by promoting resource efficient technologies and buildings20, and therefore, reduce GHG emissions. Emphasis would also be put on reducing the gender gap by ensuring that required facilities and infrastructure for women are taken into consideration as part of the design of these facilities (i.e., energy efficient street-lighting throughout the planned infrastructure, and separate women’s and men’s restrooms). The potential climate risks would be considered during the design stage. The e-promotion of local products by ADA would be based on the tagging of products with special labels emphasizing traditional eco-resilient local practices, energy conservation and limited use of chemicals; another marketing aspect would be production at the local village-community level by smallholders, predominantly women.
55. Strengthening national food safety control system. The Program would support the digital transformation of ONSSA’s operating procedures. It would also boost ONSSA’s capacity and preparedness to address sanitary emergencies such as the current COVID-19 pandemic, foodborne diseases and the spread of novel pests and diseases for which risk is exacerbated as a result of climate change. To this end, the Program would finance the costs related to: (i) the issuance of phytosanitary certificates required prior to marketing agri-food products and the digitalization processes associated with it; the Program’s target would be for ONSSA to issue 8,800 certificates for SMEs and undertake 15,000 sanitary control visits; (ii) the upgrade of ONSSA’s laboratories and strengthening of its capacities in terms of analytical control of plants and animal products, residues of veterinary drugs, residue of fertilizers, antibiotic resistance, etc.; the target would be for ONSSA to carry-out annually 206,250 lab analyses; and (iii) implementing the awareness-raising campaigns about potential spread of new pests and diseases due to climate change. The Program would fund the required technical assistance and equipment to achieve the above; ONSSA would implement this sub-program, in partnership with the Regional Directorates for Agriculture (Directions Régionales de l’Agriculture, DRAs) and territorial authorities. Increased efficiency of the issuance of phytosanitary certificates will also improve the prevention of pests and diseases epidemics which are exacerbated by climate change. Additionally, improved facilities for checking the residue of fertilizers will contribute to reduced fertilizers use and GHG emissions. Finally, going paperless will reduce CO2 emissions and contribute to climate change mitigation.
56. Improving agri-food export performance. This sub-program would involve digitalizing Morocco Foodex operations on three fronts: (i) technical control process of exports, and related issuance and management of export
19 Mainstreaming Eco-Industrial Parks, World Bank Group, 2016.
20 The three wholesale markets selected under the Program would also include renewable energy generation (photovoltaic—PV), thus contributing to mitigation co-benefits.
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inspection certifications: the target is that Morocco Foodex would perform all technical control operations and issue all exports agreements in digital format by the end of the Program; (ii) digitalized export approval process: the objective is for Morocco Foodex to handle the entire process of granting export approvals, from the formulation of the request to the issuance of the approval, in a digitalized manner; and (iii) strategic monitoring of export markets: Morocco Foodex would digitize its export market monitoring process; the advantage would be in terms of real-time, larger scope and lower cost service. The Program would finance the required technical assistance and equipment to achieve the above. Morocco Foodex would implement this sub-program, in close liaison with MAPMDREF and the private sector. The digital authorization process is also expected to contribute to the improvement of food safety by reducing foodborne disease outbreak through reduced time in transitional storage with inappropriate humidity and temperature settings and reduce the spread of novel pests and diseases exacerbated by climate change through improved traceability.
RESULT AREA 3: ENHANCED DIGITALIZATION OF AGRICULTURE AND ADOPTION OF CLIMATE SMART PRACTICES
57. Result Area 3 aims to improve the efficiency and effectiveness of agricultural support services; and enhance the environmental sustainability and climate resilience of Morocco’s agri-food value chains. Planned interventions under this Result Area would help MAPMDREF make informed decisions regarding where to target initiatives to help value chain participants. It would also offer the potential to streamline agri-food supply chains, while providing trusted information for producers and consumers. These interventions would be oriented towards promoting women’s access to agricultural extension services and information. Greater productivity is expected to be achieved via on-time agricultural advice and real-time information; for instance, on weather, climate-smart agriculture technologies, early plant disease detection, better financial access, and improved linkages to quality agricultural input and reliable off-take markets. The above would enable producers and other actors along the value chains to engage in practices to edge against climate-related risks and be prepared for emergencies. Result Area 3 would be very closely related to Result Area 1 as the innovative firms created under Result Area 1 would develop solutions for digital and climate smart agriculture. To this point, Result Area 1 would contribute to promoting digital entrepreneurship in rural areas and create the incentives and support programs for youth to provide solutions to the key challenges identified in Result Area 2 and 3. Strengthening the digital ecosystem, particularly in areas where agriculture is key to livelihoods, will support the Program’s positive outcomes and is a prerequisite for the development of local digital solutions and adoption of digital technologies. To achieve these objectives, the Program would finance the two following sub-programs:
58. Developing the digital agriculture ecosystem: A strong digital agriculture ecosystem will be a pre-requisite for the development of innovative digital solutions. To develop such an ecosystem, interventions will need to be appropriately sequenced. Amongst the priority actions are the development of a robust data platform that will provide validated data to different stakeholders. This platform will be open, secure and protected. Data Governance, Privacy and Protection will be key elements of the platform. To this end, MAPMDREF would leverage collaboration with the Digital Development Agency (Agence du Développement Digital, ADD) mandated to lead the Government’s Open Data Initiative. Agriculture can be the leader in Morocco on Open Data and an example of how to carry out such transformations in other sectors. This sub-program would support the development of a comprehensive strategy for the digital transformation of MAPMDREF that ensures optimal synergies amongst its different operating systems (MAPMDREF’s digital blueprint transformation strategy); and the digital transformation of the agricultural extension and research information systems. A focus of these systems would be on: (i) promoting knowledge and know-how on sustainable farming practices and CSA technologies that help improve productivity and over the long term reduce costs (e.g., water and input use), and build climate resilience and reduce GHG emissions intensity; and (ii) serving the needs of small producers who are still generating the bulk of the agri-food supply, with a special focus on women who play a key role in certain sectors such as fresh fruits and vegetables and often lack access to agricultural advice and information. Furthermore, the digital transformation process will require the transformation of business and organizational activities, processes, competencies and models to enable MAPMDREF to use and exploit digital technologies to improve business processes and outcomes.
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To this end, the MAPMDREF would also benefit from putting in place a Chief Digital Officer (CDO) who would be responsible for transforming public sector services, business models and ways of working using digital technologies. This person would also serve as the Chief Data Officer responsible for the asset represented by public sector data. As with all assets, data will be both maintained and leveraged in order to gain full value. The CDO (Data) is responsible for extracting data from public data and for ensuring that data is up to date and relevant. This position would be strategic as MAPMDREF moves towards scaling the use of digital technologies and data to improve decision making. Specifically, the following activities would be financed:
(a) Assessment and design of the MAPMDREF digital blueprint which would ensure the inter-operability amongst the different data systems within the Ministry and with its affiliated organizations (INRA, IAV, ONCA, ONSSA, etc.); and include a library of key information related to agriculture and livestock to be made accessible to sector stakeholders and the industry in general. The blueprint would ensure that the proposed options focus on improving data use by all agriculture stakeholders. In addition, the assessment and design process would highlight any required organizational changes to enable the Ministry to become fully digitally-enabled. MAPMDREF’s Directorate of Strategy and Statistics (Direction de la Stratégie et des Statistiques, DSS) would oversee the preparation of this study;
(b) Support of the digitalization of agricultural advisory services: The Program would strengthen ONCA’s capacity to generate digital advisory support services to farmers. This would involve: (i) the creation of a national agricultural advisory data center with regional intermediaries, i.e., acquiring, storing and processing large volume of data from farms (obtained through digital technologies such as satellite, drones and Internet of Things—IoT) and subsequently producing suitable and easy-to-use advice for farmers, with specific adaptation to women’s needs; (ii) capacity building of agricultural advisers on aspects related to the digitalization of agricultural advisory activities to ensure the dissemination of knowledge to farmers, notably climate-smart agricultural practices and technologies; the emphasis would be placed on training advisors regarding special methods tailored to reaching out to women producers; ONCA’s field personnel, as well as its management support personnel, would be provided with adequate IT equipment notably video conference systems and interactive terminals; and (iii) upgrading ONCA's internal management systems to accommodate digital innovations, manage large amount of agriculture data and set up a system for monitoring the quality of services and the level of satisfaction of ONCA's digital agricultural advisory services by beneficiaries. A study on how to upgrade the existing ARDNA21 virtual extension knowledge management platform to better contribute to the national digital extension system would be conducted;
(c) Support to INRA for the dissemination of crop vocation maps (6.5 million hectares of agricultural land) and the development and dissemination of an additional 0.5 million hectares. INRA would be also supported to: establish a digital platform for precision agriculture based on artificial intelligence, image processing (drone or satellite photos) and on agronomic calibration tests for effective spatiotemporal monitoring of crops; create a Big-Data center grouping together the platforms already existing at INRA and networking INRA’s soil and plant protection laboratories to ensure a supply of updated data across Morocco; and establish a system to estimate the area of crops based on time series of satellite images and machine learning method. The above support would enable INRA to make major headways regarding experimenting and designing solutions in such areas as eco-efficient cropping and water saving in the context of climate change;
(d) Equip ONSSA with digital technologies regarding the management of palm trees (including tools for seismic detection of red palm weevil larvae with a target of 15,000 palm trees that would be fitted with detectors); Geographic Information Systems (GIS) and satellite image processing technologies; machine learning solutions
21 “Our land”
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for image-based plant disease detection; use of drones for phytosanitary treatments (4,000 ha of forests and palm trees would be treated); and establishment of a phytosanitary risk prediction and mapping system; and
(e) In addition, the Program would finance the installation of remote management systems in selected modernized irrigation perimeters (by the Directorate of Irrigation and Development of the Agricultural Space/Direction de l’Irrigation et de l’Amenagement de l’Espace Agricole, DIAEA, in liaison with ORMVA); the design and definition of a digital transformation models in the context of agricultural aggregation projects (ADA); and the design and implementation of an academic program in data science applied to agriculture with a target of 20 agronomists graduating in applied data science (in partnership with IAV Hassan II).
59. By supporting, the above activities, the Program would allow the agriculture sector to leverage digital technologies to achieve overarching developmental goals and help the efficiency and sustainability of the sector. It would help support the creation of a strong foundation in the use of technology to improve service delivery and production.
60. Support for eco-efficient and climate resilient agriculture: This sub-program would aim at promoting precision agriculture through research and extension regarding the best agro-ecological and resilient practices. It would fund: (i) a pilot initiative to promote agro-ecology to improve resilience and eco-efficiency; the initiative would be undertaken by ADA in liaison with the DRAs; (ii) a pilot initiative to promote organic farming by the DRA under the coordination of ADA in partnership with the Interprofessional Federation of Organic Products in Morocco (Fédération Interprofessionelle du Bio au Maroc, FIMABIO), the initiatives under (i) and (ii) will target 200 farmers, out of which 20 percent would be women; and (iii) technical extension support for farmers operating in selected modernized irrigation sectors (i.e. converted to drip irrigation systems) to help them adopt additional climate smart agriculture practices to use the new irrigation system in an efficient manner; this would be undertaken through the contracting by ONCA of specialized private agricultural irrigation advisers in liaison with ORMVA and DIAEA; 12,000 farmers would be targeted in six modernized irrigated perimeters, out of which 15 percent would be women. It is estimated that GHG emission reductions through improving irrigation systems would reduce demand for pumped groundwater to supplement insufficient supplies of surface water and lead to GHG emission reductions.
61. The three Result Areas contribute to the eight Intervention Areas (IA) of the GGS (outlined in Table 1) as presented in Figure 2 below. By supporting the youth, the Program aims at supporting the development of a new generation of rural middle class. By strengthening the ecosystem for rural entrepreneurship development and improving access to financial resources for young rural entrepreneurs, the Program aims at attracting the youth to the agriculture sector and contributing directly to increased incomes for the rural youth. By improving the efficiency of agri-food marketing systems and fostering the adoption of climate smart practices, the Program aims at supporting farmers in establishing an eco-efficient and resilient agriculture sector while increasing related revenues. Sub-results Area 3.1 and 3.2 are complementary as the digital ecosystem put in place under 3.1 (such as the establishment of a National Data Center or the capacity building and digitalization of agricultural advisers) will allow for an efficient implementation of activities under 3.2, which aims to provide technical assistance for farmers and conduct pilot initiatives for agroecology and organic farming.
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Figure 2: Contribution of Result Areas to Intervention Areas of the GGS
62. Table 2 summarizes mitigation and adaptation benefits associated with the Result Areas.
Table 2. Climate change mitigation and adaptation benefits associated with the Result Areas
Result Areas
Climate Change Benefits
Mitigation Adaptation
Increased job opportunities and income generation for rural youth (RA 1)
The investment into the rural entrepreneurship ecosystem, provision of CSA training, development of the centralized online knowledge database and portal on CSA practices, and improved access to finance will build young rural entrepreneurs' capacity to integrate CSA measures into their projects. Beneficiaries are expected to have higher adoption rates of CSA given the conditionality of financing and prioritization of these practices.
Under this area, the Program would provide capacity-building and awareness-raising on climate change mitigation practices such as improved efficiency of energy use in traction, irrigation and other agricultural processes; renewable energy use in water pumping and measures to enhance carbon storage.
This area would: (i) raise awareness about climate change vulnerability of the agri-food sector and provide information on adaption measures (improved water and land management practices); and (ii) reduce climate-induced youth out-migration from rural areas by creating income opportunities and providing financial means for adaptation. The reduced men out-migration would decrease the stress and risk of female producers being left behind and tasked with providing agricultural production in a climate-stressed environment.
Improved efficiency of agri-food marketing systems (RA2)
This area would reduce GHG emissions by: (i) using resources and energy-efficient construction materials, facilities and buildings (e.g., lighting, appliances) and renewable energy in markets; (ii) prioritizing
This area would contribute to climate change adaptation by: (i) constructing market infrastructure adapted to climate change; (ii) decreasing rural out-migration resulting from the vulnerability to climate change impacts through business integration into the agri-food value
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refrigerators that use cooling systems with lower potential; (iii) providing incentives to smallholders for the implementation of low-carbon-footprint farming; and (iv) spurring improved logistics and energy efficiency (e.g., using larger vs. smaller storage facilities) through improved aggregation.
chains; (iii) strengthening the national food safety control system for reducing vulnerability from food born disease and novel invasive pests and diseases which risk is exacerbated as a result of climate change; and (iv) potentially facilitate alternative low carbon trade routes.
Enhanced digitalization of agriculture and adoption of climate-smart practices (RA3)
- This area would contribute to reducing GHG emissions through: (i) renewable energy use; (ii) resource efficiency in irrigation (e.g. energy-efficient pumping); (iii) optimized resource efficiency through precision agriculture which reduces fertilizers use; (iv) improve land restoration monitoring through satellite imaginary; and (v) e-extension services which provide information on practices that improve existing carbon pools (e.g., energy efficient tillage).
This area would contribute to climate change adaptation through: (i) implementation of drought-sensitive climate-smart farming and employment of high-efficiency irrigation (mainly drip irrigation); (ii) e-extension services to provide local agricultural advice on climate-smart practices, weather information, and timely alerts about potential pest and diseases occurrences; (iii) digitalization of land use maps to improve land use planning and policymaking; and (iv) seismic detection of red palm weevil larvae and machine learning to improve early warning systems against pest and diseases.
Note: A detailed discussion of climate adaptation and mitigation benefits of the Program is provided in Annex 3.
63. MFD approach, collaboration with the International Finance Corporation (IFC) and private sector involvement. The Program would support the GoM in addressing the binding constraints to enabling private sector solutions in the agriculture and food sector especially in youth inclusion, digital technologies and CSA. The involvement of the private sector in the Program will be key to the sustainability of the outcomes. In this context, close collaboration with IFC would be sought to improve the business environment and promote public-private dialogue. Through collaboration with the newly launched IFC-led Global Platform for Rural Connectivity, the proposed Program would be strengthened by deploying the appropriate partners to improve broadband connectivity in rural Morocco. The Program would also leverage the programs from the Disruptive Technologies and Venture Capital teams in IFC to address key constraints—e.g. providing the appropriate skills required by digital rural entrepreneurs to successfully raise private financing. In particular, the IFC platforms and networks would be leveraged to support improvement in business skills (including on digital skills and disruptive technologies) of rural youth, incubation and acceleration of ideas by rural youth (I.e. through partnerships with companies in the IFC network), support to entrepreneurs and promising disruptive/digital technologies (i.e. seed funding, venture capital, etc.). In addition, the Program will seek collaboration with IFC in the agribusiness sector. Possible entry points include PPP opportunities around promoting entrepreneurship and professionalizing farmers organizations.
64. Program Cost and Financing. The Program will be financed over five years (2021–2025) for a total of US$487 million equivalent, including an IBRD loan of US$250 million equivalent and an AFD loan of EUR100 million (Table 3).
Table 3: Program costs and source of financing (US$ million equivalent)
Source Amount % of Total
- IBRD 250.00 51.3
- Borrower 122.00 25.1
- Other development partners: Agence Française de Développement (AFD)
115.00 23.6
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Total 487.00 100
D. Disbursement Linked Indicators and Verification Protocols
65. Disbursement Linked Indicators (DLIs). Table 4 summarizes the list of DLIs, with details presented in Annex 2. Disbursements against DLIs take into consideration their contribution to the objectives of the Program. Several DLIs entail sub-indicators, which increases scalability of disbursements.
Table 4: Disbursement Linked Indicators
Disbursement Linked Indicator
DLI (US$ million equivalent)
WB/AFD
DLI scalability (yes/no)
Result Area 1: Increased job opportunities and income generation for rural youth
1 Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan (DRAs/ONCA)
15/5 Yes
2 Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs (DF22): - DLR 2.1: The governmental decree to provide incentives for young entrepreneurs to
start their rural investments has been adopted; - DLR 2.2: The joint ministerial Arrêté by MAPMDREF, MEFRA and MI to provide
incentives to support agricultural service companies has been adopted.
10/6 5/3
5/3
No
3 Young entrepreneurs who benefited from FDA incentives for rural investments (ADA): - Number of young entrepreneurs benefiting from FDA incentives to start up their
investment initiatives (16,000 beneficiaries, over three years subsequent to adoption of new legal texts for FDA)
60/30
Yes
Result Area 2: Improved efficiency of agri-food marketing systems
4 Revised legal and regulatory framework governing the new modernized wholesale markets established (DDFP/Ministry of Interior): - DLR 4.1: The Borrower has enacted amendments to article 83 of the Organic Law No.
113-14 to clarify the relationship between the private sector and municipalities as pertains to the setting up and management choice of modernized wholesale markets
- DLR 4.2: The MI’s Arrêté fixing the modalities regarding the creation and functioning of the modernized wholesale markets, has been published in the Official Gazette
20/10
10/5
10/5
No
5 Modernized wholesale market program developed (DDFP): - DLR 5.1: The national strategic environmental and social study for the Borrower’s
modernized wholesale market program has been prepared, consulted and published, all in form and substance as set forth in the POM.
- DLR 5.2: The ESIA/ESMP and, as applicable, resettlement action plan, for each of the modernized wholesale markets to be constructed in each of the Selected Cities, has been approved and published (x4)
- DLR 5.3: The Management Structures in charge of operating each of the modernized wholesale markets have been established (x4)
- DLR 5.4: The construction works and installation of equipment for each modernized wholesale market have been completed (x4)
- DLR 5.5: The modernized wholesale markets are operational (x4)
34.375/21 2/2
12/6
4/3
8.375/7
8/3
Yes
6 Food export performance improved: 20/2
Yes
22 Direction des Finances (MAPMDREF’s Directorate of Finances)
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- Percentage of export inspection certifications issued in digital form (target 100%) (Morocco Foodex)
7 Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food safety:
30/20 Yes
Result Area 3: Enhanced digitalization of agriculture and adoption of climate-smart practices
8 Digital ecosystem for climate-smart agriculture established: - DLR 8.1: Geographic Information Systems (GIS) and satellite image processing
covering 2 million hectares are operational and deployed (ONSSA) - DLR 8.2: Land use digital mapping tool for climate-smart agriculture covering 500,000
hectares has been deployed (INRA) - DLR 8.3: Remote management systems in selected modernized irrigation schemes
covering 8,000 hectares are operational and deployed (DIAEA) - DLR 8.4: ARDNA platform upgraded and 7,500 users registered
40/19 10/5.5
10/2.5
10/2.5
10/8.5
Yes
9 Adoption of climate-smart agriculture practices for the efficient use of water: - Number of producers in selected modernized irrigation schemes benefiting from
agricultural advisory extension services for the efficient use of water (12,000) and from the implementation of an M&E system measuring the related impacts (ONCA/DIAEA/ORMVA)
20/2 20/2
Yes
Front-end Fee 0.625
Total 250/115
66. Rationale for selecting DLIs
(i) DLI #1: Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan. This activity would assist youth to identify project ideas, prepare their business plans and provide the attendant entrepreneurial coaching and training. The target is to enable 10,000 young people to develop business plans that are eligible for commercial loans. The activity would involve the MAPMDREF’s DRAs at local level, as well as ONCA at central and local level.
(ii) DLI #2: Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs. This would involve reforming the FDA so that it would better serve the needs of rural youth and women. FDA would function according to operational guidelines predicated on specific rules and procedures in favor of youth and women, particularly those who would have been coached under the Program on the preparation of their business plans. DLI #2 has two DLRs: (a) DLR 2.1: The governmental decree to provide incentives for young entrepreneurs to start their rural investments has been adopted; (b) DLR 2.2: The joint ministerial Arrêté by MAPMDREF, MEFRA and MI to provide incentives to support agricultural service companies has been adopted. The process will be handled by MAPMDREF’s Directorate of Finance (Direction Financière, DF). Disbursement will be done on a yes/no basis (non-scalable).
(iii) DLI #3: Young entrepreneurs who benefited from FDA incentives for rural investments. The financial assistance under the Program would be released through FDA for agricultural start-up activities and agriculture-related service activities initiated by young people, with a target of 16,000 beneficiaries over three years subsequent to the publication of new legal texts for FDA under DLI #2. This DLI is the largest of the Program and covers the entire planned government Medium-Term Expenditures item related to rural youth financing. It is scalable.
(iv) DLI #4: Revised legal and regulatory framework governing the new modernized wholesale markets established. This DLI consists of two DLRs: (a) DLR 4.1: The Borrower has enacted amendments to article 83 of the Organic Law No. 113-14 to clarify the relationship between the private sector and municipalities as pertains to the setting up and management choice of modernized wholesale markets; and (b) DLR 4.2: The MI’s Arrêté fixing the modalities regarding the creation and functioning of the modernized wholesale markets, has been published in the Official Gazette.
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Compliance with DLI #4 will be the responsibility of the DDFP at MAPMDREF, and the Ministry of Interior including the territorial authorities (Wilayas) at local level. Related disbursements will be on a yes/no basis.
(v) DLI #5: Modernized wholesale market program developed. This DLI relates to the construction of four agricultural wholesale marketing platforms facilities under the Government’s larger program. DDFP will have the responsibility to follow up on compliance with DLI #5. Disbursements will be conditioned on compliance with the following DLRs sequentially. Related disbursements would be scalable. The Program will disburse against the following DLRs regarding each of the four market facilities financed: (a) DLR 5.1 - The national strategic environmental and social study for the Borrower’s modernized wholesale market program has been prepared, consulted and published, all in form and substance as set forth in the POM; (b) DLR 5.2 - The ESIA/ESMP and, as applicable, resettlement action plan, for each of the modernized wholesale markets to be constructed in each of the selected cities, has been approved and published; (x4); (c) DLR 5.3 - The Management Structures in charge of operating each of the modernized wholesale markets have been established; (d) DLR 5.4 - The construction works and installation of equipment for each modernized wholesale market have been completed; (e) DLR 5.5 - The modernized wholesale markets are operational. The activities under DLI #5 will be carried out in accordance with the inter-institutional framework agreement for agricultural wholesale marketing platforms (Convention Cadre) between MAPMDREF, MEFRA, MI and MICEVN that is expected to be executed prior to loan effectiveness.
(vi) DLI #6: Food export performance improved: This is a major objective of the GGS and a primary consideration in terms of foreign exchange generation for Morocco. One major focus of the Program regarding Morocco Foodex is to digitize export procedures, notably export inspection certifications which are the central administrative documents required from exporters. Hence, the allocation of funds to this DLI is predicated on the percentage of export agreements issued in digital form. The target is for the issuance of agreements to be fully digitized by the end of the Program. This DLI is scalable.
(vii) DLI #7: Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food safety. This DLI measures the number of health approvals/authorizations issued to small and medium-sized establishments and organizations not approved/authorized by ONSSA. The DLI is scalable.
(viii) DLI #8: Digital ecosystem for climate-smart agriculture established. This is central to Result Area 3, particularly as it concerns the establishment of information systems for planning, implementing and monitoring agriculture activities. This DLI includes some of the critical activities regarding the digitization of agriculture processes, including preparedness, prevention and support for public health emergencies such as the COVID-19 pandemic. The release of funds will occur separately for four separate DLRs subject to compliance with the related conditions, on a scalable basis predicated on the individually specified targets:(a) DLR 8.1 - Geographic Information Systems (GIS) and satellite image processing covering 2 million hectares are operational and deployed (ONSSA) (scalable) ; (b) DLR 8.2 – Land use digital mapping tool for climate-smart agriculture covering 500,000 hectares has been deployed (INRA) (scalable); (b) DLR 8.3 - Remote management systems in selected modernized irrigation schemes covering 8,000 hectares are operational and deployed (DIAEA) (scalable), and (d) DLR 8.4: ARDNA platform upgraded and 7,500 users registered (responsibility ONCA) (scalable).
(ix) DLI #9: Adoption of climate-smart agriculture practices for the efficient use of water. Introducing digitalization as part of the modus operandi of the extension advisory services (both public and private) is a major thrust of the Program. One area where this will be the most appropriate and most visible is precision agriculture within modernized irrigated perimeters to ensure an efficient use of water. Hence, the sizable amount of funds allocated to this DLI. The DLI is scalable: Number of producers in selected modernized irrigation schemes benefiting from agricultural advisory extension services for the efficient use of water (12,000) and from the implementation of an M&E system measuring the related impacts (joint responsibility of ONCA, DIAEA and ORMVA).
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67. Verifying the achievement of the DLIs annually will provide the basis for disbursement. The Program envisages disbursement throughout the Program implementation period based on the verification of achieved disbursement linked results. For scalable DLIs, payment will be made in proportion to the achieved results for each period after verifying the DLIs. Some DLIs will be non-scalable and, thus, only achieving the target in full would trigger the corresponding payment.
68. Verification protocols are as follows:
(i) Data source/agency: MAPMDREF, the lead implementing agency, through its DSS will collect and consolidate data and report on the achievement of the DLIs. Data providers would be MAPMDREF’s DF and DDFP, and its affiliated agencies such as ONSSA, ONCA, INRA, ADA, Morocco Foodex, etc.;
(ii) Verification entity: The MAPMDREF’s General Inspectorate of Agriculture (Inspection Générale de l'Agriculture IGA) would be tasked with verifying the achievement of DLIs as per the defined verification protocols for each DLI; and
(iii) Verification procedures: The IGA would review and approve the reports prepared by the Program Management Unit at DSS and submit them to the Ministry of Economy, Finance and Administration Reform (Ministère de l’Economie, des Finances et de la Reforme de l’Administration, MEFRA) for onward submission to the Bank, along with the accompanying evidence. In addition, the IGA will carry out site inspections and in-depth reviews of specific items, such as investment initiatives by beneficiary SMEs/Professional Organizations (POs), on a random sample basis.
E. Theory of Change
69. Figure 3 below summarizes the Program’s Theory of Change (ToC). The ToC depends on five critical assumptions related to internal and external factors: (i) even in the event of political changes, support to the agricultural sector as well as to the implementation of the GGS would remain a top priority for the Government; (ii) political commitment to the envisaged structural reforms (i.e. those related to wholesale markets; incentives targeted to youth; and access to agricultural land) are implemented in a timely manner; (iii) all involved stakeholders support the Program implementation in an efficient and coordinated manner; (iv) the public sector institutions, especially in rural areas, are willing to facilitate the creation of an enabling business environment for rural enterprise development; and (v) commercial banks are supportive of such program and provide loans to rural youth to start their agri-enterprises.
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Figure 3: Morocco Green Generation PforR - Theory of Change
III. PROGRAM IMPLEMENTATION
A. Institutional and Implementation Arrangements
70. The Program’s institutional architecture relies on multiple stakeholders with clear roles and accountability lines. Given the nature of the Program, its implementation would be based on the combined intervention of key stakeholders comprising MAPMDREF Directorates, agencies under the supervision of MAPMDREF, and partner institutions linked to MAPMDREF through specific agreements. The main institutional risk for Program implementation relates to the quality of the coordination among those entities. These agencies are listed below:
(i) MAPMDREF Directorates and decentralized services: Four Directorates would be involved in Program implementation: the DSS, DDFP, DIAEA, DEFR and DF; at sub-national level, MAPMDREF relies on its network of decentralized offices in the Regional/Provincial Directorates of Agriculture (Directions Regionales/Provinciales de l’Agriculture, DRAs/DPAs); the DRAs and DPAs play a central role in identifying, appraising and implementing projects aligned with the regional agriculture strategy; they also host the FDA one-stop-shop (guichet unique), which is the point of contact for producers applying for financial incentives granted by the FDA;
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(ii) MAPMDREF affiliated agencies: (a) ONCA, created in 2012, responsible for agriculture extension activities; (b) ONSSA created in 2012, in charge of sanitary control of food products and organized around four central directorates, with about 350 staff, as well as regional and provincial structures covering the entire territory; (c) ADA responsible for supporting the development of high-potential value chains chains with a view to improving productivity; (d) Morocco
Foodex (Etablissement Autonome de Contrôle et de Coordination des Exportations), in charge of promotion of agri-food export; (d) INRA in charge of agriculture research; and (e) IAV Hassan II in charge of higher education and research with programs supporting digital agriculture and agricultural innovations;
(iii) Other ministries and affiliated agencies: (i) Ministry of Labor and Social Affairs and the National Agency for
Employment and Competence Promotion (Agence Nationale de Promotion de l'Emploi et des Compétences, ANAPEC) which has programs in support of rural youth; and (ii) Ministry of Industry, Commerce, Green and Digital Technologies and affiliated ADD (Agence du Développement Digital);
(iv) The decentralized structures of the MI, the Wilayas or regional governorates with coordination role across decentralized services at regional level; the Wilayas oversee multi-stakeholder projects such as wholesale markets.
Program strategic oversight
71. Steering Committee (Comite de Pilotage, COPIL). Strategic decision-making responsibilities will rest with a Steering Committee comprising representatives of MAPMDREF (relevant directorates and autonomous agencies under the ministry), MEFRA (Directorate of Budget and Directorate of Treasury and External Finance – Coordination structure for relations with the World Bank), Ministère de l’Industrie, du Commerce et de l’Economie Verte et Numerique (MICEVN), MI, as well as the Wilayas involved. The Steering Committee will be chaired by the Secretary General of MAPMDREF (or his representative) and will meet every six months to review progress and make decisions required for effective Program implementation.
Coordination of Program implementation
(i) Overall coordination of Program implementation is vested with MAPMDREF. The Ministry would be the lead agency responsible for the coordination of the overall Program implementation, through DSS for implementation support.
(ii) MAPMDREF will establish a dedicated Program Management Unit (PMU) under DSS. MAPMDREF has experience with large donor-funded programs. Considering the need for close coordination of the various entities involved in Program implementation, the Ministry will establish a dedicated PMU within the DSS. The PMU will be responsible for day-to-day program coordination, management, and monitoring and evaluation. It will include technical, social and environmental, and M&E specialists. Its role will include: (a) Program monitoring and evaluation, (b) coordination of the Program’s stakeholders at the operational level, within the extended PMU, and (c) secretariat of the Steering Committee. The extended PMU includes representatives of all departments and institutions involved in Program implementation, namely DF, DIAEA, DEFR, ONCA, ONSSA, ADA, INRA, IAV, Morocco Foodex, and ORMVAs, as well as the Wilayas involved. Those representatives or focal points are designated by their respective entities.
(iii) The PMU would be supported throughout Program implementation by technical assistance. The DSS has good technical capacities, experience in managing complex programs and substantial presence in the field through the DRAs/DPAs. However, their capacity is constrained by limited staff resources and their monitoring systems need to be upgraded. Technical assistance will be mobilized through the PMU to strengthen the DSS for the monitoring and implementation of activities at central and field level, monitoring the financial management of the Program, preparing annual progress reports, and the monitoring and reporting of DLIs.
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Fiduciary and environmental and social responsibilities
72. Fiduciary and environmental and social responsibilities for the Program would be distributed as follows: (i) Fiduciary: MAPMDREF will be responsible for overall coordination of financial management and procurement under the Program; the General Inspectorate of Finance (Inspection Générale des Finances, IGF) will carry out the financial audits of Program expenditures incurred by MAPMDREF and Program affiliated entities; and (ii) Environmental and social responsibilities related to Program implementation will be vested with DSS which will be responsible to ensure compliance with and monitoring of social and environmental requirements across Program activities; they will be supported in this task by the PMU to be staffed with social and environmental specialists.
B. Results Monitoring and Evaluation
73. MAPMDREF, through the DSS would coordinate the M&E activities of the Program. It would compile and consolidate data and supporting documents, ensure data quality, and prepare and submit the reports to the Bank on a timely basis. DSS, along with DDFP, DEFR, DIAEA, DF, ADA, ONSSA, ONCA, as well as the Wilayas, will collect data about physical progress, achievement of results in each Program area, and the flow of financial funds. DRAs, ONCA and Wilayas will support data collection efforts (refer to Annex 3 for further details). The DSS will report to the Bank on a semi-annual basis, covering the following items: (i) expenditures, including transmission of audited accounts; (ii) physical progress; (iii) results framework indicators; (iv) DLIs; (v) compliance with social and environmental requirements; and (vi) grievances and any allegations of fraud and corruption. Reports will be endorsed by the Steering Committee and submitted for decision during the semi-annual meetings. A Mid-Term Review will assess progress of Program implementation towards the development objective, and, at the end of Program implementation, an independent evaluation will assess the Program’s results and impacts.
74. The Program’s M&E system would draw on the existing Government’s systems used to track implementation of the PMV and the new GGS. To collect, consolidate and report achievement of results and DLIs, the Program will take advantage of existing tracking mechanisms and types of records put in place for the activities and investments under the PMV which is being extended to the GGS. Additional data will be collected as follows: (i) investments under the FDA through DF thanks to the system SABA that manages the information on awarded incentives; and (ii) data on agricultural production, collected by DRAs by means of surveys and administrative records based on an online-based platform (STATAGRI), administered at central level by the DSS. These existing M&E systems will be further strengthened by improving their integration (web-based data administration system- Management Information System), making use of digital technologies (i.e. geo-referenced data); and allowing for gender-disaggregated data. To ensure transparency and strengthen citizen engagement, MAPMDREF would conduct at least one public consultation per year on the Program throughout the implementation period. This would be monitored as an indicator in the PforR results framework.
C. Disbursement Arrangements
75. Disbursement arrangements. Disbursement of the Bank loan proceeds would be made at the request of the Borrower upon achievement of (DLIs. Disbursements for some DLIs would be scalable, thus allowing for disbursements to be proportional to the progress towards achieving the DLI target value. Disbursements under other DLIs would not be scalable as the indicator relates to actions to be either achieved or not. For results not achieved, or partially achieved, by the due date in a given year, the allocated amount outstanding would be carried over to subsequent years. The specific amounts to be disbursed against achieved and verified results is determined in accordance with the formulas provided in Annex 2.
76. Advances and prior results financing. An advance up to US$62.2 million equivalent representing up to 25 percent of the loan amount may be requested by the Borrower once the loan becomes effective to facilitate the achievement of
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DLI results. The advance may prove necessary inter alia to support the first batch of investment projects for rural youth under Result Area 1, to provide support to ONCA for its action plan to introduce digital approaches to provide advisory services, as well as to contract technical assistance under the Program, and launch the development of the integrated financial management system for MAPMDREF. This advance would be available throughout Program implementation on a revolving basis. The Borrower has indicated its intention to avail itself of the full advance upon effectiveness.
77. Verification protocols. The verification of progress towards the achievement of the Program's objectives would be carried out by the IGA in MAPMDREF. The verification missions would be carried out at least annually, in accordance with the terms of reference set forth in the POM. The verification of achievement of Disbursement-Linked Indicators by IGA would be supported by the PMU who would compile and make available the documentation required for verification. Based on its validation, MAPMDREF, through MEFRA, would notify the World Bank of DLI achievement, supported by the relevant evidence and documentation. Following the World Bank's review of the complete documentation, including any additional information considered necessary, the World Bank would confirm the achievement of the DLI(s) and the level of Program financing proceeds available for disbursement against each DLI, including any incremental disbursement.
78. Disbursement requests. MEFRA would submit to the World Bank the relevant evidence of the total or partial achievement of DLIs. After analysis of that evidence, the World Bank would communicate to MEFRA and MAPMDREF the results of its analysis with regards to the fulfillment of DLIs and the corresponding level of disbursement for each DLI. On that basis, disbursement requests would be submitted to the World Bank by MEFRA. A copy of the World Bank's official communications confirming DLI achievements would be attached to the disbursement requests.
D. Capacity Building
79. The need for capacity building and institutional strengthening to accelerate the implementation of key reforms and investments supported by the proposed Program are substantial. The approach taken has been to incorporate the related capacity building and institutional strengthening activities into the design of the proposed Program. Key institutional strengthening efforts under the Program would be directed at MAPMDREF (building its capacity to coordinate, manage, monitor and evaluate the implementation of the Program, etc.), ONCA, ONSSA, and Morocco Foodex. Actions to strengthen ONCA’s, ADA’s and ONSSA’s capacity to carry out their mandates include specialized training, improved management systems (e.g., expanded register of agri-food enterprises) and upgrades to its facilities (such as computer facilities and laboratories). The Program would further support and strengthen the management entities to be created for the management of the four new modernized wholesale markets. When relevant, related indicators have been included in the PforR results framework, DLIs, and Program Action Plan (PAP).
IV. ASSESSMENT SUMMARY
A. Technical
80. Strategic Relevance. The Program would support the objectives of the GGS which is the Government’s medium-term sector strategy for agriculture and rural development. Considering the average contribution of the agriculture sector to total GDP (15 percent), the sector’s contribution to exports (10 to 15 percent of total exports), the high share of employment generated by the agriculture sector (40 percent), and the high share of the rural population dependent on agriculture for their livelihoods (85 percent), the GGS is of high strategic relevance for Morocco. The GGS, which the proposed Program would support, will give particular emphasis to both export-led sector growth and socio-economic considerations (increasing incomes in rural areas especially for youth and reducing the gap with urban areas). The Program would also emphasize environmental considerations and, in particular, improved water management and climate resilience, in view of the agriculture sector’s vulnerability to climate variability and climate change. Finally, job creation and the creation of a rural middle class will be a key objective of the new agricultural strategy. The Program will be designed to support the Government’s renewed thrusts towards the above objectives under the GGS, as a
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continuation of efforts undertaken as part of the PMV. The final evaluation of the PMV completed in 2018 points to its large positive impact on agriculture and the well-being of the rural population.
81. The Program aims at accelerating progress towards the objectives of the newly launched GGS. The design of the Program recognizes that reaching the objectives of the GGS with regards to the overall transformation of the Moroccan agri-food sector— and, specifically, value-addition in the agri-food sector, agricultural exports, increased private sector investments and job creation —will require progress in three areas: (i) the capacity of the institutions and entities responsible for GGS implementation, including several of them still at nascent stage, will need to be strengthened to enable them to fully implement their mandate, (ii) some of the key institutional reforms initiated under the PMV are not yet fully implemented (such as reforms of the management of wholesale markets, a cornerstone of the strategy to improve market efficiency and transparency) and enhancements can be made to the instruments (targeted incentives) introduced under the PMV to support investment in the agri-food sector, innovation and value-addition, as well as small and medium producers’ linkages with modern value chains.
82. Technical Soundness. The Program’s design rests on solid technical basis. Those include the analytical work and diagnostics carried out specifically for the preparation of the PMV and successor GGS programs, and the experience that the Government has acquired during the PMV implementation—in developing and implementing sectoral policies, strategies and action plans, in working with farmers, their organizations and agribusinesses, in facilitating public-private dialogue and collaboration, and in strengthening public institutions serving the agriculture sector. The Government has clearly shown ownership of its sector policies and strategies throughout PMV implementation, under the leadership of MAPMDREF. The Program design also integrates the lessons from existing evaluations of Bank and other donor-financed support to the PMV, the Government’s own evaluation of PMV implementation, and it draws on a large body of studies pertaining to agri-food value-chains. The Program includes some of the lessons learned through the Bank’s global experience with similar operations, such as the need for a strong institutional champion (the Program relies on solid leadership by MAPMDREF) and demonstrated continued support from central ministry’s policymaking and oversight functions.
83. The Program technical soundness is predicated on the following key elements: (i) Result Area 1—Increased job opportunities and income generation for rural youth: the lack of interest of youth for rural jobs is due to their lack of attractiveness in terms of hardship and work environment; it is also contingent on the risks and challenges they face in developing their enterprises. The Program builds on the lessons learnt from previous experience, pointing to the need to respond to the youth’s needs in terms of information on available investment opportunities, appropriate technical support to prepare projects and provision of financial incentives to fund youth enterprises; (ii) Result Area 2—Improved efficiency of agri-food marketing systems: the wholesale marketing and distribution systems in Morocco is regulated by outdated legislation; the Program would amend the regulatory framework for wholesale marketing and build four efficient wholesale markets that would serve the needs of farmers and up-takers and result in better final prices for consumers. Regarding food safety and quality control, the evaluation of the PMV suggests that it is weak whereas it is a pre-requisite to adding value for agri-food products; the Program would help ONSSA address critical areas for improvement of food safety. Finally, exports procedures need to be streamlined and made more efficient to take advantage of export opportunities; hence, the Program support to Morocco Foodex to digitalize operations in that area; and (iii) Result Area 3—Enhanced digitalization of agriculture and adoption of climate smart practices: a recent diagnostic23 suggests that the potential for growth in digital agriculture is significant; both the public and private sectors have a clear role in ensuring that Morocco can take advantage of new digital technologies to improve the equity, sustainability and efficiency of agriculture activities. The Program would help fulfill this role by helping MAPMDREF, affiliated organizations and the private sector to acquire a good knowledge of these technologies and reform accordingly,
23 World Bank (2019): Digital Agriculture: Diagnostic and Potential in Morocco.
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with a special attention to data access and management, the promotion of awareness and demonstration, support to the necessary rural facilities, the promotion of digital supply capacity by domestic startups and SMEs, dissemination of digital knowledge and improvement in academic curricula to address the market demand for digital expertise.
84. Climate Smart Agriculture. A Climate Smart Agriculture Investment Plan (CSAIP) has been prepared for Morocco under the Morocco-led Initiative for the Adaptation of African Agriculture to Climate Change (AAA Initiative). It is a tool to implement Morocco’s Nationally Determined Contributions (NDCs) in the agricultural sector. The CSAIP builds on a track record of achievements under the PMV and has been developed within the framework of national sector investment programs in water and agriculture. This first version of the Morocco CSAIP has selected projects according to their contribution to CSA, as well as ease of implementation, broader economic feasibility, innovative aspects and socio-economic importance. The projects focus on scaling up ongoing climate-smart projects, new projects directed to climate-smart agriculture, and capacity building projects. One of the key projects outlined in the Morocco CSAIP—strengthening extension services for areas recently converted to drip irrigation—is included in the proposed Program.
85. Digital Agriculture. A diagnostic of the digital agriculture potential of Morocco was prepared in 2018-19. The diagnostic was conducted through interviews with the main domestic stakeholders in the public and private sector24. The diagnostic’s conclusions suggest that: (i) Morocco is just starting the digital transformation process of the agriculture sector and that process is promoted by both private and public sector; (ii) the potential for growth in digital agriculture is considerable; (iii) as in other more advanced agriculture sectors, research and development of digital solutions is mostly in the hands of the private sector; and (iv) the public sector has a clear mission in ensuring that these new technologies contribute to improving the equity, sustainability and efficiency of agriculture activities. Fulfilling this mission requires acquiring a good knowledge of these technologies in order to be able to regulate their use with a special attention to data access and management, promoting awareness and demonstration, building and improving the necessary rural infrastructure, fostering digital supply capacity by domestic startups and SMEs, disseminating digital knowledge and improving academic curricula to address the market demand for digital expertise.
86. Gender – female entrepreneurship. While the proportion of women entrepreneurs remains below that of men worldwide, it is particularly low in Morocco (World Economic Forum, 2010). It is currently estimated that only 10 percent of entrepreneurs in the formal sector are women (Amina & Habiba Bensassi, 2018). Yet, this percentage masks female entrepreneurship in the informal sector. Recent research shows that women face relatively more constraints in comparison with their male counterparts in developing a business with respect to: (i) limited access to information and insufficient support programs; (ii) limited access to networking opportunities; (iii) difficulties in accessing finance; and (iv) cultural perceptions and obsolete societal representations, among others (Bouzekraoui & Ferhane, 2017). The Program aims at supporting women in taking on entrepreneurial leadership roles and at contributing to closing the gender gap they face in establishing their businesses by tackling the aforementioned constraints.
87. Gender – female participation along the agri-food value chain. In 2019, a gender study was conducted analyzing women’s constraints and opportunities along three agri-food value chains in Morocco, particularly the olive, citrus, and herb and medicinal plant value chains. The report identifies major gender gaps, such as: (i) disparities regarding the occupation of positions involving decision making, with women generally involved in non-decision making positions; (ii) disparities in access to information and advisory services, with women having limited access to extension services not adapted to their needs; (iii) differences in the access to production factors (land, water, processing equipment) resulting
24 The main technologies analysed include cross-cutting technologies such as computational decision and analytics tools, the cloud, sensors, block chain, robots and digital communication tools. In addition, field-based activities are enabled by geo-location technologies such as Global Positioning Systems (GPS), geographical information systems, yield monitors, precision soil sampling, proximal and remote spectroscopic sensing, unmanned aerial vehicles (drones), auto-steered and guided equipment. Animal-focused technologies include sensors and radio frequency identification (RFID chips) and automated (robotic) milking and feeding systems, among others. Controlled-environment agriculture (greenhouses and indoor farms) is also increasingly enabled by digital technologies such as sensors and robots.
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in lower productivity and access to financial services; (iv) disparities in the level of producer organization and hence, limited access to national or international markets; (v) exclusion of women from tasks involving technical knowhow or physical strength due to discrimination and stereotypes about women not being able to conduct technical or heavy labor, (vi) differences in wages and working conditions, with women generally conducting seasonal work linked to precarious working conditions and limited access to social security (due to the temporary nature of employment); among others. The study presents the following recommendations: (i) improve women’s access to information and advisory services, including training on quality promotion, marketing and marketing techniques; (ii) support the organization of women cooperatives and by this improve women’s access to essential production factors, finance and markets; (iii) reduce the wage gap, improve working conditions and social protection of seasonal workers; and (iv) optimize administrative procedures, for example by setting up a one-stop shop for farmer support, among others. The Program would support female cooperatives through investments in training on management and marketing techniques, and financial support among others to meet the requirements stipulated by ONSSA and improve market access.
88. Citizen engagement. The Program aims at empowering citizens to participate in the development process and integrating citizen voice considered as key accelerators to achieving results. Citizen engagement will therefore allow to improve development results and contribute to building sustainable national systems for citizen engagement with governments and the private sector. The objectives of citizen consultations include receiving input for improved decision-making about the implementation arrangements of the Program, to contribute to improved results and sustainability. This approach is in line with the 2011 Constitution, which requires strong participatory processes for planning public investments, citizen feedback opportunities, robust grievance resolution mechanisms (GRM) and access to information.
89. Citizens targeted by the Program are both the youth and actors along the agri-food value chain benefitting from activities being developed under the Program, particularly women. Under Result Area 1 the youth will be consulted before/during/after the ideation workshops, and before and during business creation support. Under Result Area 2 and 3 actors along the agri-food value chain will be consulted ahead of the development of tools aimed at facilitating marketing, commercialization and advisory services to get an in-depth understanding of concerns and needs as well as during the roll-out of the developed tools to allow for improvements. The indicator “at least one public consultation on the Program carried out each year by MAMPDREF” will allow for the continuous evaluation of citizen engagement through the Program. The schedule and detailed content of the consultation will be defined in accordance with the Program implementation schedule for each activity and a report will be prepared accordingly. Consultation methods will include focus group discussions, household surveys and interviews, electronic consultations, and advisory/expert groups.
90. Program Expenditure Framework. The Program financing will amount to US$487 million equivalent over a period of five years (2021–2025) of which IBRD will finance US$250 million equivalent and the AFD will finance US$115 million equivalent (Table 3 below).
Table 3: Program costs and sources of financing (US$ million equivalent) Source Amount % of Total
IBRD 250.00 51.3
Borrower 122 25.1
AFD 115.00 23.6
Total 487 100
91. The Program Expenditure Framework (PEF) is extracted at more than 86 percent from the MAPMDREF’s and the six public entities’ budgets and will be included within the General Budget of the State (Budget General de l’Etat). The PEF is structured around three result areas: (i) Increased job opportunities and income generation for rural youth (29.1percent), (ii) Improved efficiency of agri-food marketing systems (48.3 percent), and (iii) Enhanced digitalization of agriculture and adoption of climate smart practices (22.6 percent). The Program expenditures under these three result
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areas can be grouped under four main procurement categories: (i) Civil Works (21 percent), (ii) Equipment and goods (30 percent), (iii) Consulting and non-consulting services (22 percent), and (iv) Funding or grant mechanism (27 percent).
92. Alignment with Government priorities. Alignment of the budget with Government priorities, classification, sustainability, and predictability are assessed as more than adequate. The planned expenditures are adequate to achieve the PforR results. The Program activities covered by the expenditure framework meet the directions set by the Government, under the GGS. The Program budget structure specifies sources of funding, budgetary vehicles, and categories of expenditures. A detailed assessment of the expenditure framework is provided in Annex 4.
B. Program economic rationale
93. Rationale for public intervention. The Program aims at accelerating the structural transformation of the agri-food sector by addressing several market failures affecting its performance, mainly through the use of digital technologies facilitating access to advice, and finance. These market failures occur due to: (i) lack of support services and access to finance for young entrepreneurs; (ii) limited access to markets for small-scale producers linked to inadequate traceability, inefficient inspections and certification processes for food safety among others; and (iii) limited access to knowledge and skills on the adoption of improved agricultural or sustainable practices.
94. Economic impact of the Program. The Program aims at: (i) increasing job creation and income generation for rural youth; (ii) developing efficient marketing systems; and (iii) enhancing the digitalization of agriculture and the adoption of climate smart agriculture practices. This will result in improved incomes for the youth in rural areas, improved marketing on local markets and increased exports of agri-food products, improved efficiency and effectiveness of agricultural services, and improved sustainability of agri-food value chains.
95. World Bank and AFD value added. World Bank and AFD support is expected to improve the efficiency and targeting of the activities supported under the Program, thereby increasing both its economic, social and environmental benefits. The World Bank has global expertise in the design and implementation of innovative projects and programs in the agri-food sector. In addition, the World Bank has been deeply involved with the GoM since the inception of the PMV and during the preparation of the GGS, notably through the DPF series and a PforR supporting the PMV. The Bank is thus in a unique position to support the GoM in designing and implementing the Program in order to maximize economic, social and environmental benefits.
96. The economic evaluation analyzed the investments foreseen under the Program, carrying out (i) a financial analysis of the main physical investments (i.e. the four wholesale markets), and (ii) an international benchmarking—done by analyzing similar activities (i.e. technical and financial support of newly established enterprises, and establishment of business incubators) in past projects/programs in countries depicting similarities with Morocco with respect to their agri-food sectors. The analysis has confirmed the economic soundness of the interventions supported by the Program.
C. Fiduciary
97. An integrated Fiduciary Systems Assessment (FSA) of the MAPMDREF and other implementing agencies (ADA, INRA, IAV, ONSSA, Morocco Foodex and ONCA) was prepared by the Bank based on: (i) the analysis of quantitative and qualitative fiduciary data from the implementation of the existing Strengthening Agri-Food Value Chain PforR (P158346); (ii) the Bank’s knowledge of the financial management and procurement systems in force in Morocco; (iii) the recent national Public Expenditure and Financial Accountability (PEFA) report completed in 2017; (iv) the fiduciary data made available by MAPMDREF and five autonomous agencies that it oversees, and (v) the audit reports issued by the oversight bodies (IGF and Court of Accounts).
98. The fiduciary risk is rated Moderate. To ensure adequate implementation, the fiduciary systems will need to be strengthened.
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99. Fiduciary risks and Mitigation measures. The following fiduciary risks were identified : (i) potential delays in the procurement process for the execution of the civil works required for the construction of the four wholesale markets, which represent 20 percent of the expenditure framework (Result Area 2); (ii) weak or lack of internal control systems to ensure a correct execution of the financing mechanisms for youth entrepreneurs; and (iii) lack of standardization and coordination between the fiduciary processes of the different entities responsible for program implementation.
100. To mitigate the abovementioned risks, the Program’s design includes a comprehensive set of measures. First, the risk of delays in the procurement process for the execution of the civil works related to wholesale markets will be mitigated by the definition of a set of indicators. They will be relating to the launch of bidding and signing of contracts for the four wholesale markets by the end of the first 30 months of Program. Their monitoring will be ensured through the submission of quarterly procurement performance monitoring report, to be carried out by the DDFP at MAPMDREF. Second, the risk related to the financing of youth projects will be mitigated by the development of a detailed section of the POM by the MAPMDREF that will include criteria and modalities for the selection of the beneficiaries and fiduciary reporting arrangements. This will provide all the guidance for access to financing and subsidy measures, as well as a Grievance Redress Mechanism (GRM) to promote a consistent approach to handling complaints. The assessment of the degree of compliance of youth projects with these guidelines will be included as audit diligence in the terms of reference of the annual program audits to be carried out by the IGF. Third, the risk associated to the lack of standardization and coordination between the fiduciary processes of the different entities responsible for Program implementation will be mitigated by the adoption of a harmonized financial reporting framework to facilitate the consolidation of financial information and which will be included in the POM.
101. Procurement exclusions. The Program excludes any activities which involve the procurement of high-value contracts with estimated values exceeding the following monetary amounts, as may be amended from time to time, that require mandatory review by the Bank’s Operational Procurement Review Committee (OPRC): (1) works, estimated to cost US$115,000,000 equivalent or more per contract; (2) goods, estimated to cost US$75,000,000 equivalent or more per contract; (3) non-consulting services, estimated to cost US$75,000,000 equivalent or more per contract; or (4) consultants’ services, estimated to cost US$30,000,000 equivalent or more per contract.
102. Program Fiduciary Arrangements. MAPMDREF would be responsible for overall Program coordination. Program activities would be executed by MAPMDREF and six other implementing agencies (ADA, INRA, IAV, ONSSA, Morocco Foodex and ONCA). Seven entities would then have fiduciary responsibilities during the implementation of the Program. The Program will follow those entities’ planning and budgeting processes. The lack of standardized and coordinated fiduciary processes of the various autonomous entities under MAPMDREF has been identified as one of the main risks. This risk will be mitigated through specific actions included in the Program Action Plan (PAP). The Program will apply MAPMDREF’s and its partner agencies’ budget execution procedures combined with the adoption of a pre-defined reporting format to be prepared by each entity. The Program will rely on MAPMDREF and other implementing agencies’ internal control procedures which were found adequate. Program funds will be disbursed directly to a country Treasury Single Account opened in the books of the Public Treasury based on the achievement of results (DLIs).
103. Actions related to fraud and corruption. The Borrower would: (a) take all appropriate measures to ensure that the Program is carried out in accordance with the Bank’s “Guidelines on Preventing and Combating Fraud and Corruption in Program-for-Results Financing,” dated February 1, 2012, and revised July 10, 2015 (Anti-Corruption Guidelines); (b) take all appropriate measures to prevent fraud and corruption in connection with the Program, including (but not limited to) adopting and implementing appropriate fiduciary and administrative practices and institutional arrangements to ensure that the proceeds of the Loan are used only for the purposes for which the Loan was granted; (c) promptly inform the Bank of all credible and material allegations or other indications of fraud and corruption in connection with the Program that come to its attention, together with the investigative and other actions that the Borrower proposes to take
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with respect thereto; (d) unless otherwise agreed with the Bank with respect to a particular case, take timely and appropriate action to investigate such allegations and indications; report to the Bank on the actions taken in any such investigation, at such intervals as may be agreed between the Borrower and the Bank; and, promptly upon the completion of any such investigation, report to the Bank the findings thereof; (e) if the Borrower or the Bank determines that any person or entity has engaged in fraud and corruption in connection with the Program, take timely and appropriate action, satisfactory to the Bank, to remedy or otherwise address the situation and prevent its recurrence; and (f) ensure that any person or entity debarred or suspended by the Bank is not awarded contract under or otherwise allowed to participate in the Program during the period of such debarment or suspension. The Bank’s debarment list, which is easily accessible, will be checked by all procuring entities before awarding contracts.
104. Audits. The IGF would carry out the financial audits of the Program expenditures incurred by all involved entities. One financial statement will be produced, which will include the expenses made by MAPMDREF, ADA, INRA, IAV, ONSSA, Morocco Foodex and ONCA, according to a format defined in the POM. They will indicate the budget expenditure lines included within the framework of the Program as defined in the POM. Audits will be conducted in accordance with the terms of reference of PforR audits agreed between the IGF and the Bank. The audits will cover the period corresponding to a fiscal year of the Borrower from the year of first disbursement. One audit report will be produced for MAPMDREF, ADA, INRA, IAV, ONSSA, Morocco Foodex and ONCA. The scope of those audits will include an opinion on the procurement system. The audit reports will be produced no later than nine months after the closure of accounts.
105. Governance risks. As to broader governance risks, the Program would rely on local and national institutions such as: (i) the National Commission of Public Procurement (Commission Nationale de la Commande Publique, CNCP) - Morocco’s new public procurement regulatory body in charge of handling public procurement complaints and regulatory oversight, including for municipalities; and (ii) the Central Body for Corruption Prevention (Instance Centrale de Prévention de la Corruption - ICPC). The ICPC has recently drafted a National Strategy on Anticorruption based on the International Convention on Anticorruption.
106. More details on the Program’s fiduciary system assessment can be found in the Annex 4.
D. Environmental and Social
107. An Environmental and Social Systems Assessment (ESSA) has been prepared by the World Bank for the Program. It assesses the national environmental and social management systems and those of the implementing and executing agencies of the Program, against the ESSA core principles and exclusions of the World Bank’s Policy and Bank Directive on Program-for-Results Financing, and the Bank Guidance on Program-for-Results Financing Environmental and Social Systems Assessment 25. The ESSA is based on documentation review, engagement with stakeholders at national and local levels, and engagements with a sample of Regional Directorates of Agriculture. The ESSA evaluates the track record of previous operations funded by the World Bank in the agricultural sector in Morocco.
108. The draft ESSA report was shared with program stakeholders and discussed during a consultation workshop held on September 8, 2020 during which all parties affected by Program activities were invited to participate. The ESSA final report includes the comments received and is made public on the World Bank website and on the MAPMDREF website. The participants in the public consultation endorsed the risk analysis presented in the ESSA and the proposed mitigation measures and considered that the proposed action plan and follow-up program are sufficient to ensure its effective implementation.
25https://spappscsec.worldbank.org/sites/ppf3/PPFDocuments/Forms/DispPage.aspx?docid=e6f1f05d-74b8-44b3-9d84-a59afc3c4a32&ver=current
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109. An assessment of the portfolio of activities to be supported by the Program was undertaken to identify potential environmental and social risks and impacts. The Program will have positive effects on the environment (introduction of sustainable techniques) and on the population (improvement of income and living conditions). The Program will benefit stakeholders by improving access for young people (including women) to investment opportunities in the agricultural sector. The 2011 Constitution requires strong participatory processes for planning public investments, citizen feedback opportunities, robust grievance resolution mechanisms (GRM) and access to information, which will be key aspects of the proposed operation.
110. Considering the lack of leverage of the implementing agency over the executing agencies, no activities requiring the involuntary acquisition of private land will be supported by the Program. Physical investments will be undertaken in the public domain to avoid involuntary acquisitions of private land. Other resettlement risks to be managed will be limited to restrictions on access to sites or to sources of income during the construction phase. To prevent or mitigate these risks, design changes and mitigation measures will be implemented, including planning and sequencing of work, alternative access options, consultation with affected people and easy access to appropriate GRMs. Plans to document, supervise and manage voluntary land acquisition and other land-related impacts will be prepared and implemented by the executing agencies of physical investments.
111. For major physical investments such as the construction of new wholesale markets, the necessary mitigation measures (environmental and social assessment to be undertaken by the executing agencies, designation of an environmental and social (E&S) focal point to ensure monitoring and reporting during design, construction and operation, etc.) are to be included in the ESSA action plan and the Program Action Plan.
112. The environmental and social risks and negative impacts associated with the Program are considered moderate. An ESSA was prepared by the Bank and assessed the environmental and social risks under the Program and identified the necessary mitigation measures to be integrated into the Program Action Plan. The risks would be easy to identify in advance and to prevent and minimize through effective mitigation measures. They would be subject to an environmental monitoring and follow-up system that will allow for the identification and management of potential risks in real time. Depending on the type, scope and extent of works under this Program, the negative social and environmental impacts would be typical construction risks specific to the site and generally limited to the construction phase. For some Program activities, in particular the wholesale markets, a strategic E&S assessment, ESIAs and social action plans will be prepared to ensure inclusive planning of those activities and to avoid negative environmental and social impacts. Social risks beyond land acquisition, notably aspects of diversity such as the inclusion of vulnerable groups, universal access for people living with a disability, ensuring gender equity, and the establishment of functioning grievance redress mechanisms will require measures new to the implementing and executing agencies. Environmental and social mitigation measures will be developed with the relevant agencies, and a rigorous environmental and social monitoring and control system will make it possible to minimize and manage risks and impacts. Those measures are included in the ESSA and Program Action Plan, and will require improvements in funding, personnel, and capacity.
113. Due to the limited capacity of the agencies responsible for implementing the activities of the Program, and their track record in managing E&S risks, the ESSA and Program Action Plan include specific measures aimed at strengthening environmental and social management systems at the level of each executing agency and according to their responsibilities in the implementation and monitoring of Program activities (see Annex 5). The Program would support the development of practical tools for executing agencies to: (i) diagnose the environmental and social risks associated with their activities, (ii) identify relevant risk mitigation measures, and (iii) monitor the implementation of applicable risk mitigation measures. The use of these tools and the implementation of risk mitigation measures would be monitored as part of the annual performance evaluation. The latter would include specific indicators on environmental and social management under the Program.
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114. The PMU would include a dedicated environmental and social focal unit whose role will be to organize and coordinate capacity building activities, to provide practical support to participating agencies in the application of the E&S tools developed in the Program and to monitor and evaluate E&S management systems at the Program level. Each participating agency in the Program would designate an E&S focal point whose role will be to implement the E&S systems and support the E&S focal unit of the PMU in monitoring and reporting on the implementation of the management system.
115. Morocco has several institutions responsible for handling and settling complaints. The national Grievance Redress Mechanisms (GRM) and institutions available have been elevated to the rank of constitutional bodies to give them the independence and financial autonomy necessary to validate their power of self-orientation. MAPMDREF as implementing agency (IA) has experience with handling complaints and grievances related to national programs and the ongoing PforR. The IA would be responsible for maintaining and supervising (and creating, if not yet existing) a GRM that allow communities and individuals who feel they have been harmed as a result of a Bank-supported PforR operation, as defined by applicable policy and procedures, to submit complaints to the complaints mechanism of the existing Program or to the World Bank Grievance Redress Service (GRS). The communities and individuals concerned can submit their complaints to the World Bank's Independent Inspection Panel, which determines whether damage has occurred or could occur due to the World Bank's failure to comply with its policies and procedures. For more information on how to submit complaints to the World Bank's GRS, please visit http://www.worldbank.org/GRS. For more information on how to submit complaints to the World Bank Inspection Panel, please visit www.inspectionpanel.org.
E. RISK ASSESSMENT
116. Based on the assessments conducted, the overall risk rating for the Program is Moderate.
117. The technical program design risk is considered Moderate. The Government’s program has been conceived as the continuation of its previous program for the agricultural sector, the PMV. In particular, the legal framework for wholesale agricultural marketing platforms is a critical step for the Program to guarantee the efficient operational management of this new generation of markets. However, the risk of the proposed legislation not being adopted in a timely manner is considered low given the broad agreement among institutional stakeholders on the need to move forward quickly.
118. Fiduciary risks are assessed as Moderate, and environmental and social risks are Moderate. Fiduciary risks are primarily linked to procurement capacities of the different institutions. Environmental and social risks are associated to perceived weaknesses of the existing environment and social systems at the national and regional levels, and relative weakness of MAPMDREF (and the related agencies) in the management of adverse environmental and social impacts. To mitigate those risks, the Program would strengthen both fiduciary and environmental and social capacities in MAPMDREF and other agencies with continuous training and technical assistance.
119. Despite certain risks associated with this type of Program, MAPMDREF has a long-standing and strong operational experience working on the implementation of several Bank-financed operations (including a recent one using the PforR instrument). This would allow early identification and mitigation of potential risks.
120. Program beneficiaries and other participants can voice complaints and comments regarding Program implementation, including those relating to other executing agencies. GRMs are currently established in the MAPMDREF and several executing agencies using their institutional or national systems such as Chikaya.ma. The IA would ensure that the GRM is in place from effectiveness of the Program so that potential complainants have confidence in the system. The GRM would be widely announced and ensured to be accessible for all potential complainants.
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121. Neither OP 7.50 International Waterways nor OP 7.60 Disputed Areas is applicable to the Program. The Program will not affect international waterways as defined under OP 7.50 and will have no cross-boundary impacts. No activities will be financed through the Program in disputed areas as defined in OP 7.60.
Table 4: Systematic Operations Risk Rating Tool (SORT)
Risk Categories Rating (H, S, M or L)
1. Political and governance M
2. Macroeconomic M
3. Sector strategies and policies M
4. Technical design of program M
5. Institutional capacity for implementation and sustainability M
6. Fiduciary M
7. Environment and social M
8. Stakeholders M
9. Others
Overall Risks M .
F. PROGRAM ACTION PLAN
122. Based on the risk assessment, the PAP includes actions aimed at strengthening the capacity of implementing agencies in the following four areas: (i) Program management, (ii) fiduciary systems, (iii) environmental and social management, and (iv) Program M&E. As such, it is focused on mitigating the moderate risks identified with regards to Program implementation, which are: (i) inter-agency coordination and MAPMDREF’s staff resources to coordinate, manage, monitor and evaluate the Program, (ii) weaknesses identified in the fiduciary systems and risks associated with the number of Program implementing entities, and (iii) the need to increase the capacity of the Program implementation entities with regards to social and environmental aspects. The PAP also includes critical actions necessary to operationalize the adjustments to the government program supported by the PforR. Details are provided in Annex 6.
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Results Framework COUNTRY: Morocco
Morocco Green Generation Program-for-Results Program Development Objective(s)
The PDO is to increase the economic inclusion of youth in rural areas and the marketing efficiency and environmental sustainability of agri-food value chains in the Program area.
Program Development Objective Indicators by Objectives/Outcomes
RESULT_FRAME_TBL_ PD O
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
INCREASED JOB OPPORTUNITIES AND INCOME GENERATION FOR RURAL YOUTH
Number of young people who
have created agriculture-
related enterprises that have
been operational for at least
six months (Number)
0.00 2,500.00 5,000.00 8,000.00 10,500.00 13,000.00
of which female
(Percentage) 0.00 25.00 25.00 25.00 25.00 25.00
IMPROVED MARKETING EFFICIENCY OF AGRI-FOOD MARKETING SYSTEMS
Volume of local products
marketed through modernized 0.00 865,000.00
ANNEX 1. RESULTS FRAMEWORK MATRIX
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RESULT_FRAME_TBL_ PD O
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
wholesale markets (in metric
tons) (Metric ton)
ADOPTION OF CLIMATE SMART PRACTICES
Number of producers adopting
climate smart agriculture
practices (Number)
0.00 0.00 3,000.00 9,000.00 12,000.00 12,000.00
of which female
(Percentage) 0.00 0.00 25.00 25.00 25.00 25.00
.
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.
Intermediate Results Indicator by Results Areas
RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
Increased job opportunities and income generation for rural youth
Young people informed,
identified and guided by the
entrepreneurship support
system on the service offer on
agricultural entrepreneurship
through communication
campaigns and ideation
sessions (Number)
0.00 10,000.00 20,000.00 40,000.00 65,000.00 90,000.00
of which female
(Percentage) 0.00 25.00 25.00 25.00 25.00 25.00
Trainers trained to develop the
capacities of agricultural
vocational training
establishments on agricultural
entrepreneurship (Number)
0.00 30.00 60.00 60.00
of which female
(Percentage) 0.00 25.00 25.00
Number of business plans
prepared by young
entrepreneurs in rural areas
eligible for a commercial loan
(Number)
DLI 1 0.00 500.00 2,000.00 5,000.00 7,500.00 10,000.00
of which female
(Percentage) 0.00 25.00 25.00 25.00 25.00 25.00
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RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
Young entrepreneurs who
benefited from FDA incentives
for rural investments (Number) DLI 3 0.00 3,000.00 8,000.00 16,000.00
of which female
(Percentage) 0.00 25.00 25.00 25.00
Reform of the legal framework
of the FDA to include
incentives for young rural
entrepreneurs (Text)
DLI 2 no
The governmental
decree to provide
incentives for young
entrepreneurs to start
their rural investments
has been adopted.
The joint ministerial
Arrêté by MAPMDREF,
MEFRA and MI to
provide incentives to
support agricultural
service companies has
been adopted.
The governmental decree
to provide incentives for
young entrepreneurs to
start their rural
investments has been
adopted. The joint
ministerial Arrêté by
MAPMDREF, MEFRA and
MI to provide incentives
to support agricultural
service companies has
been adopted.
Service companies receiving an
incentive to support a
structured agricultural
entrepreneurship (Number)
0.00 150.00 400.00 800.00
Young people who have
benefited from aid for the
rental of agricultural land
(Number)
0.00 2,000.00 7,000.00 14,500.00
of which female
(Percentage) 0.00 25.00 25.00 25.00
Young people trained and
innovative projects awarded & 0.00 20.00 40.00 40.00
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RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
supported (national
competition) (Number)
of which female
(Percentage) 0.00 25.00 25.00 25.00
Young people supported for
the emergence and
empowerment of agricultural
service cooperatives (Number)
0.00 200.00 200.00
of which female
(Percentage) 0.00 25.00 25.00
At least one public consultation
on the Program carried out
each year by MAMPDREF
(Yes/No)
No Yes Yes Yes Yes Yes
Improved efficiency and sustainability of agri-food marketing systems
Revised legal and regulatory
framework governing the new
modernized wholesale markets
established (Text)
DLI 4 no revsion
The Borrower has
enacted amendments to
article 83 of the Organic
Law No. 113-14 to clarify
the relationship
between the private
sector and municipalities
as pertains to the setting
up and management
choice of modernized
wholesale markets.
The MoI’s Arrêté fixing
the modalities regarding
the creation and
functioning of the
modernized wholesale
markets has been
published in the Official
Gazette.
The Borrower has enacted
amendments to article 83
of the Organic Law No.
113-14 to clarify the
relationship between the
private sector and
municipalities as pertains
to the setting up and
management choice of
modernized wholesale
markets. The MoI’s Arrêté
fixing the modalities
regarding the creation
and functioning of the
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RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
modernized wholesale
markets has been
published in the Official
Gazette.
Modernized wholesale market
program developed (Text) DLI 5
The national strategic
environmental and
social study for the
Borrower’s modernized
wholesale market
program has been
prepared, consulted and
published, all in form
and substance as set
forth in the POM.
The ESIA/ESMP and, as
applicable, resettlement
action plan, for each of
the modernized
wholesale markets to be
constructed in each of
the Selected Cities, has
been approved and
published.
The Management
Structures in charge of
operating each of the
modernized wholesale
markets have been
established.
The construction works
and installation of
equipment for each
modernized wholesale
market have been
completed. The
modernized wholesale
markets are operational.
Export approvals issued
digitally (filing of applications,
monitoring, granting and
renewal of approvals)
(Percentage)
0.00 50.00 100.00 100.00 100.00 100.00
Food export performance
improved: percentage of
export inspection certifications
issued in digital form
(Percentage)
DLI 6 0.00 50.00 100.00 100.00 100.00 100.00
Number of agri-food
enterprises/organizations
authorized by ONSSA for
improved market access and
improved food safety
(Number)
DLI 7 7,800.00 8,200.00 8,400.00 8,600.00 8,800.00 8,800.00
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RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
Enhanced digitalization of agriculture and adoption of climate smart practices
Study on digital transformation
of MAPMDREF prepared
(Yes/No)
No Yes Yes
Land use digital mapping tool
for climate-smart agriculture
covering 500,000 hectares has
been deployed (Hectare(Ha))
6,500,000.00 6,750,000.00 7,000,000.00 7,000,000.00
Digital platform for precision
farming implemented and
operational (Yes/No)
No Yes Yes Yes
GIS and satellite image
processing covering 2 million
hectares are operational and
deployed (Number)
DLI 8 0.00 2,000,000.00 2,000,000.00
Remote management systems
in selected modernized
irrigation schemes covering
8,000 hectares are operational
and deployed (Hectare(Ha))
0.00 3,800.00 8,000.00
ARDNA platform upgraded and
7,500 users registered
(Number)
0.00 500.00 1,500.00 3,500.00 5,500.00 7,500.00
of which female
(Percentage) 0.00 25.00 25.00 25.00 25.00 25.00
Number of producers
benefiting from a pilot
initiative for the promotion of
agroecology and organic
0.00 100.00 200.00 200.00
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RESULT_FRAME_TBL_ IO
Indicator Name DLI Baseline Intermediate Targets End Target
1 2 3 4
farming (Number)
of which female
(Percentage) 0.00 25.00 25.00 25.00
Agricultural engineers
graduated in data science
applied to agriculture
(Number)
0.00 10.00 20.00
of which female
(Percentage) 0.00 25.00 25.00
Women cooperatives have
received training through
digital technologies developed
under the Program (Number)
0.00 20.00 40.00 60.00 80.00 100.00
.
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.
Monitoring & Evaluation Plan: PDO Indicators
Indicator Name Definition/Description Frequency Datasource Methodology for Data Collection
Responsibility for Data Collection
Number of young people who have created agriculture-related enterprises that have been operational for at least six months
This indicator measures the number of young people who have created agriculture-related enterprises that have been operational for at least six months.
Annual
List of beneficiaries and reports of communication campaigns and ideation sessions provided by ONCA/DRA. List of recipients of FDA incentives.
Analysis of activity reports of the responsible implementing agencies.
PMU/DSS
of which female
This indicator measures the number of new female entrepreneurs who created their first agriculture-related enterprise. This number includes newly established female entrepreneurs only.
Annual
List of beneficiaries and reports of communication campaigns and ideation sessions provided by ONCA/DRA.
Analysis of activity reports of the responsible implementing agencies.
PMU
Volume of local products marketed through modernized wholesale markets (in metric tons)
The indicator measures the volume of local products marketed through modernized wholesale markets.
Annual DDFP
Analysis of activity reports provided by operational wholesale markets supported under the Program.
DSS/PMU
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Number of producers adopting climate smart agriculture practices
Number of producers in selected modernized irrigation schemes adopting climate-smart agriculture practices (as defined in the Program Operational Manual—POM) in synergy with the newly deployed drip irrigation technology. This indicator represents a climate change indicator (following corporate guidelines, stipulating that beginning FY21 all IBRD-financed operations with 20 percent or more Climate Co-Benefits are expected to include at least one climate-related indicator in their results frameworks), as the climate smart practices adopted and measured under this indicator will contribute to an improved adaptation of producers to climate change.
Annual ONCA/DIAEA/ORMVA
Collected as part of the verification of DLI 9 by reviewing ORMVAs' registers and official records.
DSS/PMU
of which female .
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.
Monitoring & Evaluation Plan: Intermediate Results Indicators
Indicator Name Definition/Description Frequency Datasource Methodology for Data Collection
Responsibility for Data Collection
Young people informed, identified and guided by the entrepreneurship support system on the service offer on agricultural entrepreneurship through communication campaigns and ideation sessions
90,000 young people will take advantage of these sessions, to be organized in seminars or workshops, to allow them to inquire about the economic opportunities of their territory and the technical and financial opportunities offered by the support system for agricultural entrepreneurship.
Annual
List of beneficiaries, reports of communication campaigns and ideation sessions provided by ONCA/DRA.
Analysis of activity reports by the responsible institution (ONCA).
PMU
of which female 25 percent of 90,000 youth will be women
Annual
List of beneficiaries, reports of communication campaigns and ideation sessions provided by ONCA/DRA.
Analysis of activity reports from the responsible institution (ONCA).
PMU
Trainers trained to develop the capacities of agricultural vocational training establishments on agricultural entrepreneurship
60 trainers will be trained, through technical assistance, to deliver training modules on agricultural entrepreneurship to
Annual
Attendance lists, training materials, training certificates
Summary note on the training provided (themes, participants, documents attesting to the achievement of this action, etc.)
DEFR
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trainees in the vocational training system in its different modes and levels of training
of which female 25 percent of 60 trainers trained will be women
Annual
Attendance lists, training materials, training certificates
Summary note on the training provided (themes, participants, documents attesting to the achievement of this action, etc.)
DEFR
Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan
10,000 young entrepreneurs are supported in pre-creation by the support system for agricultural entrepreneurship, through technical assistance through group training, personalized advice and internships in companies over a period of 3 to 6 months.
Biannual
ONCA's records on young entrepreneurs supported in the development of a business plan; ONCA's records on reviews received from commercial banks on the business plans supported by ONCA.
Registration of business plans prepared and reviews received from commercial banks.
DRAs/ONCA
of which female 25 percent of 10,000 youths will be women
Biannual
Files of young entrepreneurs, service companies
Analysis of files (list of registered individuals, business plans, etc.)
DRA/ONCA
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and cooperatives supported by the responsible institution
Young entrepreneurs who benefited from FDA incentives for rural investments
16,000 young people will benefit from an incentive to start their businesses
Biannual DF records State of subsidies established by the DF
DF
of which female 25 percent of 16,000 youths will be women.
Biannual DF State of subsidies established by the DF
DF
Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs
Texts on the changes of the incentive and legal framework of the FDA for the benefit of young entrepreneurs in the agricultural sector promulgated: 1. The governmental decree to provide incentives for young entrepreneurs to start their rural investments has been adopted. 2. The joint ministerial Arrêté by MAPMDREF, MEFRA and MI to provide incentives to support agricultural service companies has been adopted.
Biannual SGG
Confirmation of the transmission to the General Secretariat of the Government
DF
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Service companies receiving an incentive to support a structured agricultural entrepreneurship
800 service companies (10 young people per company) will benefit from a financial incentive
Annual System SABA
Statement of subsidies as extract from the System SABA
ADA
Young people who have benefited from aid for the rental of agricultural land
14,500 young people who benefit from aid for renting agricultural land
Annual System SABA
Statement of subsidies extracted from the System SABA
ADA
of which female 25 percent of 14,500 youths will be women
Annual System SABA
Statement of subsidies as extracted from the system SABA
ADA
Young people trained and innovative projects awarded & supported (national competition)
Number of young people trained and supported following the launch of two calls for projects for the identification of innovative projects (digital and climate-resilient)
Annual ADA
Launch through call of interest, list of participants in the call for projects, youth submissions, minutes of jury committee, note on the training for young people selected (training program and themes, beneficiaries, trainers, etc.), list of winning projects, report on support actions carried out.
PMU
of which female 25 percent of 40 youths will be women
Annual ADA
Launch through call of interest, list of participants in the call for projects, youth submissions, minutes of jury committee, note on the training for young
PIU
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people selected (training program and themes, beneficiaries, trainers, etc.), list of winning projects, report on support actions carried out
Young people supported for the emergence and empowerment of agricultural service cooperatives
Number of young people supported as part of a pilot initiative for the emergence and empowerment of agricultural service cooperatives
Annual ADA
Lists of young people supported, partnership agreements, statutes of cooperatives, activity reports
PMU
of which female 25 percent of 200 youths will be women.
Annual ADA
Lists of young people supported, partnership agreements, statutes of cooperatives, activity reports
PIU
At least one public consultation on the Program carried out each year by MAMPDREF
The indicator measures whether at least one public consultation on the Program was carried out each year by MAMPDREF.
Annual Consultation reports
Preparation of consultation reports.
DSS/PMU
Revised legal and regulatory framework governing the new modernized wholesale markets established
The revision of the regulatory framework is key to implementing the agricultural wholesale market program and needs to be completed upfront before any development of
Biannual
Ministry of Interior, Official Gazette publications
Verification of the publication of texts in the Official Gazette
DDFP/PIU
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market facilities would take place.
Modernized wholesale market program developed
Four modernized wholesale markets are set up and operational (Berkane, Agadir, Meknes and Marrakech)
Biannual
Ministry of Interior, Wilayas, DDFP
Documents attesting to the different implementation phases: Agreements signed, Management Structures of modernized wholesale markets are put in place, Environmental impact study, etc. Followed by the DDFP and the Wilayas.
DDFP/PIU
Export approvals issued digitally (filing of applications, monitoring, granting and renewal of approvals)
The indicator measures the percentage of the formulation of requests and granting of export approvals done digitally.
Annual Morocco Foodex
Platform accessible to exporters, Morocco Foodex activity reports on export control activity
DSS/PMU
Food export performance improved: percentage of export inspection certifications issued in digital form
The indicator measures the percentage of inspection requests made by exporters on a dedicated platform and respective inspection certificates issued digitally.
Biannual Morocco Foodex
Platform accessible to exporters for formulating their requests, inspection certificates generated through platform.
DSS/PMU
Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food safety
Number of health approvals/authorizations issued.
Annual
ONSSA progress report
Monthly reports by ONSSA Regional Directorates
DSS/PIU
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Study on digital transformation of MAPMDREF prepared
Results of the Department of Agriculture's digital transformation study
Annual DSI Report on receipt of study results
DSS/PIU
Land use digital mapping tool for climate-smart agriculture covering 500,000 hectares has been deployed
Deployment of a land use digital mapping tool for Climate-Smart Agriculture.
Annual INRA
Maps and tables generated through the platform
DSS/PIU
Digital platform for precision farming implemented and operational
Digital platform for precision agriculture based on artificial intelligence, image processing (drones or satellites) and on agronomic calibration tests for effective spatio-temporal monitoring of crops is established and operational.
Annual INRA
Reports and data generated through the platform
DSS/PIU
GIS and satellite image processing covering 2 million hectares are operational and deployed
Acquisition and installation of a Geographic Information System (GIS) and a satellite image processing system
Biannual
ONSSA progress report
Maps and activity reports generated through GIS
DSS/PIU
Remote management systems in selected modernized irrigation schemes covering 8,000 hectares are operational and deployed
Area equipped with remote recovery and remote management systems for controlling water distribution in modernized irrigation sectors
Biannual
ARDNA platform upgraded and 7,500 users registered
Number of active users registered on the ARDNA platform (producers, agricultural advisers,
Biannual
File generated through the ARDNA platform
ONCA
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researchers, ...).
of which female
Percentage of female active users registered on the ARDNA platform (producers, agricultural advisers, researchers, ...)
Biannual
File generated through the ARDNA platform
ONCA
Number of producers benefiting from a pilot initiative for the promotion of agroecology and organic farming
Producers benefiting from support for the retraining of their projects for the adoption of agroecological or organic management practices
Biannual ADA
Conventions, project sheets, list of producers, activity reports
ADA
of which female
25 percent of 200 producers benefiting from the pilot initiative are women
Biannual ADA
Conventions, project sheets, list of producers, activity reports
ADA
Agricultural engineers graduated in data science applied to agriculture
Agricultural engineers who have received diploma training over 18 months in data science applied to agriculture
Annual IAV Hassan II
Accreditation file adopted by the Ministry of Higher Education 2021, lists of students admitted in 2023, degrees awarded
IAV Hassan II
of which female
25 percent of 40 agricultural engineers who receive diploma training over 18 months in data science applied to agriculture are women
Annual IAV Hassan II
Accreditation file adopted by the Ministry of Higher Education 2021, lists of students admitted in 2023, degrees awarded
IAV Hassan II
Women cooperatives have received training through digital technologies
Number of women cooperatives who have
Annual ONCA progress
Analysis of ONCA progress reports
ONCA
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developed under the Program received training through digital technologies developed under the Program.
reports
.
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.
. .
Disbursement Linked Indicators Matrix
DLI_TBL_MATRIX
DLI 1 Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Intermediate Outcome Yes Text 15,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline 0.00
Prior Results
0.00
CY 2021 DLR#1.1: 500 in CY2021, from a baseline of 0 750,000.00 D=BP/T*A
CY 2022 DLR#1.2: cumulative 2,000 in CY2022, from a baseline of 500
2,250,000.00 D=BP/T*A
CY 2023 DLR#1.3: cumulative 5,000 in CY2023, from a baseline of 2,000
4,500,000.00 D=BP/T*A
CY 2024 DLR#1.4: cumulative 7,500 in CY2024, from a baseline of 5,000
3,750,000.00 D=BP/T*A
CY 2025 DLR#1.5: cumulative 10,000 in CY2025, from a baseline of 7,500
3,750,000.00 D=BP/T*A
ANNEX 2. DISBURSEMENT LINKED INDICATORS, DISBURSEMENT ARRANGEMENTS AND VERIFICATION PROTOCOLS
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DLI_TBL_MATRIX
DLI 2 Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Intermediate Outcome No Text 10,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline Existing legal framework not including specific incentive measures for young people
Prior Results
0.00
CY 2021 DLR 2.1: The governmental decree to provide incentives for young entrepreneurs to start their rural investments has been adopted
5,000,000.00 Yes/No
CY 2022 DLR 2.2: The joint ministerial Arrêté by MAPMDREF, MEFRA and MI to provide incentives to support agricultural services companies has been adopted.
5,000,000.00 Yes/No
CY 2023
0.00
CY 2024
0.00
CY 2025
0.00
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DLI_TBL_MATRIX
DLI 3 Young entrepreneurs who benefited from FDA incentives for rural investments
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Output Yes Text 60,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline 0.00
Prior Results
0.00
CY 2021
0.00
CY 2022
0.00
CY 2023 DLR#3.1: 3,000 in CY2023, from a baseline of 0 11,250,000.00 D=P/T*A
CY 2024 DLR#3.2: cumulative 8,000 in CY2024, from a baseline of 3,000
18,750,000.00 D=P/T*A
CY 2025 DLR#3.3: cumulative 16,000 in CY2025, from a baseline of 8,000
30,000,000.00 D=P/T*A
DLI_TBL_MATRIX
DLI 4 Revised legal and regulatory framework governing the new modernized wholesale markets established
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Process No Text 20,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline Current regulatory framework for wholesale
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markets
Prior Results
0.00
CY 2021
0.00
CY 2022 DLR 4.1: The Borrower has enacted amendments to article 83 of the Organic Law No. 113-14 to clarify the relationship between the private sector and municipalities as pertains to setting up and management choice of modernized wholesale markets
10,000,000.00 Yes/No
CY 2023 DLR 4.2: The MoI’s Arrêté fixing the modalities regarding the creation and functioning of the modernized wholesale markets has been published in the Official Gazette
10,000,000.00 Yes/No
CY 2024
0.00
CY 2025
0.00
DLI_TBL_MATRIX
DLI 5 Modernized wholesale market program developed
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Output Yes Text 34,375,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline New wholesale market program not developed
Prior Results
0.00
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CY 2021 DLR 5.1: The national strategic environmental and social study for the Borrower’s modernized wholesale market program has been prepared, consulted and published, all in form and substance as set forth in the POM.
2,000,000.00
CY 2022 DLR 5.2: The ESIA/ESMP and, as applicable, resettlement action plan, for each of the modernized wholesale markets to be constructed in each of the Selected Cities, has been approved and published. (x4)
12,000,000.00
CY 2023 DLR 5.3: The Management Structures in charge of operating each of the modernized wholesale markets have been established. (x4)
4,000,000.00
CY 2024
0.00
CY 2025 DLR 5.4: The construction works and installation of equipment for each modernized wholesale market have been completed (x4, total: US$ 8,375,000); DLR 5.5: The modernized wholesale markets are operational (x4, total: US$ 8,000,000)
16,375,000.00
DLI_TBL_MATRIX
DLI 6 Food export performance improved: percentage of export inspection certifications issued in digital form
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Outcome Yes Text 20,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
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Baseline 0.00
Prior Results
0.00
CY 2021 DLR#6.1: 50% in CY2021 from a baseline of 0 in CY2020
10,000,000.00 D=E/T*A
CY 2022 DLR#6.2: 100% in CY2022, from a baseline of 50% 10,000,000.00 D=E/T*A
CY 2023
0.00
CY 2024
0.00
CY 2025
0.00
DLI_TBL_MATRIX
DLI 7 Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food safety
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Outcome Yes Text 30,000,000.00
Period Value Allocated Amount (USD) Formula
Baseline 7,800
Prior Results
0.00
CY 2021 DLR#7.1: 8,200 in CY2021, from a baseline of 7,800
12,000,000.00 D=A/T*A
CY 2022 DLR#7.2: cumulative 8,400 in CY2022, from a baseline of 8,200
6,000,000.00 D=A/T*A
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CY 2023 DLR#7.3: cumulative 8,600 in CY2023, from a baseline of 8,400
6,000,000.00 D=A/T*A
CY 2024 DLR#7.4: cumulative 8,800 in CY2024, from a baseline of 8,600
6,000,000.00 D=A/T*A
CY 2025
0.00
DLI_TBL_MATRIX
DLI 8 Digital ecosystem for climate-smart agriculture established
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Output Yes Text 40,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline 0.00
Prior Results
0.00
CY 2021
0.00
CY 2022 DLR 8.1: Geographic Information Systems (GIS) and satellite image processing covering 2 million hectares are operational and deployed (ONSSA)
10,000,000.00 D=TA/T*A
CY 2023 DLR 8.2: Land use digital mapping tool for climate-smart agriculture covering 500,000 hectares has been deployed (INRA)
10,000,000.00 D=TA/T*A
CY 2024 DLR 8.3: Remote management systems in selected modernized irrigation schemes covering 8,000 hectares are operational and deployed
20,000,000.00 D=TA/T*A
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(DIAEA)--US$10,000,000; DLR 8.4: ARDNA platform upgraded and 7,500 users registered (responsibility ONCA)--US$10,000,000
CY 2025
0.00
DLI_TBL_MATRIX
DLI 9 Adoption of climate-smart agriculture practices for the efficient use of water
Type of DLI Scalability Unit of Measure Total Allocated Amount (USD) As % of Total Financing Amount
Outcome Yes Text 20,000,000.00 0.00
Period Value Allocated Amount (USD) Formula
Baseline 0.00
Prior Results
0.00
CY 2021
0.00 D=P/T*A
CY 2022 DLR#9.1: 3,000 producers in selected modernized irrigation schemes benefiting from agricultural advisory extension services for the efficient use of water and from the implementation of a monitoring and evaluation system measuring the related impacts, in CY 2022, from a baseline of 0
5,000,000.00 D=P/T*A
CY 2023 DLR#9.2: cumulative 9,000 producers in selected modernized irrigation schemes benefiting from agricultural advisory extension services for the efficient use of water and from the implementation of a monitoring and evaluation system measuring the related impacts, from a
10,000,000.00 D=P/T*A
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baseline of 3,000
CY 2024 DLR#9.3: cumulative 12,000 producers in selected modernized irrigation schemes benefiting from agricultural advisory extension services for the efficient use of water and from the implementation of a monitoring and evaluation system measuring the related impacts, from a baseline of 9,000
5,000,000.00 D=P/T*A
CY 2025
0.00
.
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.
Verification Protocol Table: Disbursement Linked Indicators
DLI_TBL_VERIFICATION
DLI 1 Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan
Description
This activity will assist youth to identify project ideas, prepare standard business plans, feasibility studies and other ways of
making their projects bankable, and provide the attendant coaching and training, including entrepreneurial support. The
target is to develop individual project dossiers for the benefit of 10,000 young people that are eligible to bank financing,
with specific criteria for eligibility set forth in the POM. The activity would involve the MAPMDREF’s DRAs at local level, as
well as ONCA at central and local level. The DLI is scalable. Disbursements will be proportional to the annual targets,
calculated on the basis of the following formula: Disbursement (D) is equal to the number of business plans which have
received approval (BP), divided by the total number of business plan target under said DLR (T), multiplied by total amount
allocated to said DLR (A).
Data source/ Agency DRAs/ONCA
Verification Entity IGA
Procedure Verified by IGA using information provided by the DRAs/ONCA on business plans that have been thoroughly reviewed by a
commercial bank and judged eligible for a commercial loan (the loan could be approved or not). DLI_TBL_VERIFICATION
DLI 2 Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs
Description
Reform of the legal framework to facilitate access to financing for young entrepreneurs in agriculture-related activities. This
will involve reforming the Agriculture Development Fund (FDA) so that it can better serve the needs of the most vulnerable
people, particularly the rural youth and women. FDA will have to function according to operational guidelines predicated on
specific rules and procedures in favor of youth and women, particularly those who would have been coached under the
Program at pre-creation stage. DLI 2 has two DLRs of the following reform: - DLR 2.1: The governmental decree to provide
incentives for young entrepreneurs to start their rural investments has been adopted; - DLR 2.2: The joint ministerial Arrêté
by MAPMDREF, MEFRA and MI to provide incentives to support agricultural services companies has been adopted.
Allocated amounts will be disbursed on a "Yes/No" basis. - Following verification of DLR 2.1, an amount of USD 5 million will
be disbursed. - Following verification of DLR 2.2, an amount of USD 5 million will be disbursed.
Data source/ Agency DF
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Verification Entity IGA
Procedure
Verified by IGA using FDA operating rules and procedures. ‘The realization of the DLRs will materialize by the adoption of
the decree and order and transmission to the Bulletin Officiel for their publication. The process will be handled by
MAPMDREF’s Directorate of Finance (DF).” DLI_TBL_VERIFICATION
DLI 3 Young entrepreneurs who benefited from FDA incentives for rural investments
Description
Number of young people benefiting from FDA incentives to start up their investment initiatives or agri-enterprises (16,000
beneficiaries, over three years subsequent to adoption of new legal texts for FDA) The financial assistance under the
Program will be released through FDA for agricultural start-up activities and agriculture-related service activities by young
people, with a target of 16,000 beneficiaries, over three years subsequent to publication of new legal texts for FDA under
DLI 2. This DLI is the largest of the Program and covers the entire planned government medium-term expenditures item
related to rural youth financing. The DLI is scalable. Disbursements will be proportional to the annual targets, calculated on
the basis of the following formula: Disbursement (D) is equal to the number of people who received incentives (P), divided
by the total target of number of people to receive incentives under said DLR (T), multiplied by total amount allocated to said
DLR (A).
Data source/ Agency ADA
Verification Entity IGA
Procedure Verified by IGA by reviewing DF records on investments supported by the FDA (certificate of eligibility and supporting
documents). DLI_TBL_VERIFICATION
DLI 4 Revised legal and regulatory framework governing the new modernized wholesale markets established
Description
The regulatory framework is instrumental to implementing the agricultural wholesale market program and needs to be
completed upfront before any development of market facilities would take place. This DLI consists of two DLRs: - DLR 4.1:
The Borrower has enacted amendments to article 83 of the Organic Law No. 113-14 to clarify the relationship between the
private sector and municipalities as pertains to the setting up and management choice of modernized wholesale markets -
DLR 4.2: The MoI’s Arrêté fixing the modalities regarding the creation and functioning of the modernized wholesale markets
has been published in the Official Gazette Allocated amounts will be disbursed on a "Yes/No" basis. - Following verification
of DLR#4.1, an amount of USD 10 million will be disbursed. - Following verification of DLR#4.2, an amount of USD 10 million
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will be disbursed.
Data source/ Agency IGA
Verification Entity Directorate for the Development Value Chains (DDFP) at MAPMDREF
Procedure
Verified by IGA with respect to the amended Organic Law and the Arrêté published in the Official Gazette.
Compliance with DLI #4 will be the responsibility of the Directorate for the Development Value Chains (DDFP) at
MAPMDREF, and the Ministry of Interior including the territorial authorities (Wilayas) at the local level. DLI_TBL_VERIFICATION
DLI 5 Modernized wholesale market program developed
Description
Support to the agricultural wholesale market program. This DLI relates to the construction of four wholesale market
facilities under the Government’s larger wholesale market program. DDFP will have the responsibility to follow up on
compliance with DLI #5. Disbursements will be conditioned on compliance with the following DLRs sequentially. The
Program will disburse against the following DLRs regarding each of the four market facilities financed: - DLR 5.1: The
national strategic environmental and social study for the Borrower’s modernized wholesale market program has been
prepared, consulted and published, all in form and substance as set forth in the POM. - DLR 5.2: The ESIA/ESMP and, as
applicable, resettlement action plan, for each of the modernized wholesale markets to be constructed in each of the
Selected Cities, has been approved and published. (x4) - DLR 5.3: The Management Structures in charge of operating each of
the modernized wholesale markets have been established. (x4) - DLR 5.4: The construction works and installation of
equipment for each modernized wholesale market have been completed (x4) - DLR 5.5: The modernized wholesale markets
are operational (x4) Allocated amounts will be disbursed on a "Yes/No" basis. - Following verification of DLR 5.1, an amount
of USD 2 million will be disbursed. - Following verification of DLR 5.2, an amount of USD 12 million will be disbursed (3
million per study) - Following verification of DLR 5.3, an amount of USD 4 million will be disbursed (1 million per
Management Structure) - Following verification of DLR 5.4, an amount of USD 8.375 million will be disbursed (2 093 750 per
wholesale market) - Following verification of DLR 5.5, an amount of USD 8 million will be disbursed (2 million per wholesale
market)
Data source/ Agency DDFP
Verification Entity IGA
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Procedure
- DLR 5.1: Verified by IGA by reviewing the study.
- DLR 5.2: Verified by IGA by reviewing the studies.
- DLR 5.3: Verified by IGA through the submission of evidence on the implementation of the management structures as
defined in the POM and in accordance with Organic Law no. 113-14 relating to municipalities.
- DLR 5.4: Verified by IGA by reviewing progress reports.
- DLR 5.5: Verified by IGA by reviewing progress reports indicating that the modernized wholesale market is operating in
accordance with specific criteria defined in the POM (among others, operators from other markets have transferred to the
modernized market in line with the social action plan)
Verified by the IGA by reviewing progress reports.
DLI_TBL_VERIFICATION
DLI 6 Food export performance improved: percentage of export inspection certifications issued in digital form
Description
Improving food export performance: This is a major objective of the GGS and a primary consideration in terms of foreign
exchange generation for Morocco. One major focus of the Program regarding Morocco Foodex is to digitize export
procedures, notably export inspection certifications which are the central administrative documents required from
exporters. Hence, the allocation of funds to this DLI is predicated on the percentage of export inspection certifications
issued in digital form. The target is for the issuance of certifications to be fully digitized by the end of the Program. This DLI
is scalable. Disbursements will be proportional to the annual targets, calculated on the basis of the following formula:
Disbursement (D) is equal to the percentage of digitized export inspection certifications issues (E), divided by the total
percentage target of export inspection certifications to be digitized under said DLR (T), multiplied by total amount allocated
to said DLR (A).
Data source/ Agency Morocco Foodex
Verification Entity IGA
Procedure Verified by IGA by reviewing Morocco Foodex's registers and official records.
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DLI_TBL_VERIFICATION
DLI 7 Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food
safety
Description
Number of small- and medium-sized enterprises/organisations authorized by ONSSA. The DLI is scalable. Disbursements will
be proportional to the annual targets, calculated on the basis of the following formula: Disbursement (D) is equal to the
number of health approvals/authorization issued (A), divided by the total target of health approvals/authorizations to be
issued under said DLR (T), multiplied by total amount allocated to said DLR (A).
Data source/ Agency ONSSA
Verification Entity IGA
Procedure Verified by IGA by reviewing ONSSA's registers and official records. DLI_TBL_VERIFICATION
DLI 8 Digital ecosystem for climate-smart agriculture established
Description
Digital ecosystem for climate-smart agriculture. This is central to Results Area 3, particularly as it concerns the
establishment of data information systems for planning, implementing and monitoring agriculture activities. This DLI
includes some of the critical activities regarding the digitization of agriculture processes, including preparedness, prevention
and support for sanitary emergencies such as the Covid 19 pandemic. - DLR 8.1: Geographic Information Systems (GIS) and
satellite image processing covering 2 million hectares are operational and deployed (ONSSA, scalable) - DLR 8.2: Land use
digital mapping tool for climate-smart agriculture covering 500,000 hectares has been deployed (INRA, scalable) - DLR 8.3:
Remote management systems in selected modernized irrigation schemes covering 8,000 hectares are operational and
deployed (DIAEA, scalable) - DLR 8.4: ARDNA platform upgraded and 7,500 users registered (responsibility ONCA, scalable) -
Following verification of DLR 8.1, an amount of USD 10 million will be disbursed; - Following verification of DLR 8.2, an
amount of USD 10 million will be disbursed; - Following verification of DLR 8.3, an amount of USD 10 million will be
disbursed; - Following verification of DLR 8.4, an amount of USD 10 million will be disbursed. DLR 8.1, 8.2, 8.3 and 8.4 are
scalable. Disbursements will be proportional to the annual targets, calculated on the basis of the following formula:
Disbursement (D) is equal to the target achieved (TA), divided by the total target under said DLR (T), multiplied by total
amount allocated to said DLR (A).
Data source/ Agency - DLR 8.1: ONSSA - DLR 8.2: INRA - DLR 8.3: DIAEA - DLR 8.4: ONCA
Verification Entity IGA
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Procedure
Verified by IGA by reviewing the records of the different entities.
The release of funds will occur piecemeal for the four separate DLRs in compliance with the related conditions, on a
scalable basis with respect to the individual specified targets. DLI_TBL_VERIFICATION
DLI 9 Adoption of climate-smart agriculture practices for the efficient use of water
Description
DLI: Number of producers in selected modernized irrigation schemes benefiting from agricultural advisory extension
services for the efficient use of water (12,000) and from the implementation of an M&E system measuring the related
impacts. The DLI is scalable. Disbursements will be proportional to the annual targets, calculated on the basis of the
following formula: Disbursement (D) is equal to the number of producers (P), divided by the total target of producers under
said DLR (T), multiplied by total amount allocated to said DLR (A).
Data source/ Agency ONCA, DIAEA and ORMVA
Verification Entity IGA
Procedure
Verified by IGA by reviewing ONCA's registers and official records, in collaboration with ONCA and in accordance with the
description of advisory services provided to farmers and the monitoring and evaluation system put in place in the selected
sectors, as set forth in the POM. .
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ANNEX 3. TECHNICAL ASSESSMENT
1. Strategic Relevance. The Program will support the objectives of the GGS (the new phase of PMV) which is the Government’s medium-term sector strategy for agriculture and rural development. Considering the contribution of the agriculture sector to total GDP (15 percent), the sector’s contribution to exports (10 to 15 percent of total exports), the high share of employment generated by the agriculture sector (40 percent), and the high share of the rural population dependent on agriculture for their livelihoods (85 percent), the GGS is of high relevance for Morocco. The GGS, which the Program will support, places emphasis on both export-led sector growth and socio-economic considerations (increasing incomes in rural areas especially for youth and reducing the gap with urban areas). The Program would focus on three key areas of the GGS that are inherently interdependent: (i) increased job opportunities and income generation for rural youth; (ii) improved efficiency of agri-food marketing systems; and (iii) enhanced digitalization of agriculture and adoption of climate-smart practices, as well as strengthened M&E capacity of implementing agencies. The Program would support the incentive schemes and ecosystem with a focus on enabling the private sector to provide digital and climate smart technologies and getting farmers and agri-food SMEs to adopt these technologies. Increased adoption of these technologies is expected to transform the Moroccan agri-food sector and contribute to reaching the higher-level objectives of the GGS: (i) the valorization of human capital through the creation of a new rural middle class and support to a new generation of young entrepreneurs for the creation of jobs in rural areas (especially for the youth and women); and (ii) sustainability of agricultural development, through consolidated agri-food value chains and strengthened resilience to climate change. The Program would also contribute to investments for digital transformation which are important to mitigate the current COVID-19 pandemic (and prepare for future similar crises). The Program will be designed to support the Government’s renewed thrust towards the above objectives under the GGS program, as a continuation of efforts undertaken as part of the PMV. The final evaluation of the PMV done in 2018 point to the its large positive impact on agriculture and the well-being of the rural population26.
2. The Program aims at accelerating progress towards the objectives of the GGS. The design of the Program recognizes that reaching the objectives of the GGS with regards to the overall transformation of the Moroccan agri-food sector— and, specifically, value-addition in the agri-food sector, agricultural exports, increased private sector investments and job creation — will require progress in three areas: (i) the capacity of the institutions and entities responsible for the implementation of the GGS, including several of them still at nascent stage, need to be strengthened to enable them to fully implement their mandate, (ii) some of the key institutional reforms initiated under the PMV are not yet fully implemented (such as reforms of the management of wholesale markets, a cornerstone of the strategy to improve market efficiency and transparency) and (iii) instruments (targeted incentives) introduced under the PMV to support investment in the agri-food sector, innovation and value-addition, as well as small and medium producers’ linkages with modern value chains can be further enhanced.
A. PROGRAM DESCRIPTION
RESULT AREA 1 - INCREASED JOB OPPORTUNITIES AND INCOME GENERATION FOR RURAL YOUTH
3. Result Area 1 would contribute to establishing a holistic entrepreneurship development program dedicated to youth in rural areas. This would be achieved through a range of activities under two Sub-Result Areas: (i) strengthening the ecosystem for rural entrepreneurship development; and (ii) facilitating access to financial resources for young rural entrepreneurs to start their agri-enterprises and/or pursue other agriculture-related services. Experience has shown that youth in rural areas face several challenges to develop their enterprises or enter the job market. They have limited
26 MAPMDREF (2020)
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access to information, advisory services, technology, and innovation (knowledge constraints), have limited access to credit (finance constraints), and are more burdened by regulation and transactions (business environment constraints). Limited job opportunities particularly make youth vulnerable to climate change impacts and foster out-migration from rural areas. RA1 seeks to alleviate these constraints to increasing job opportunities and incomes for rural youth.
4. RA1 is aligned with the orientations of the GGS, in what pertains to its objective of developing a new generation of agricultural entrepreneurs. The Program would achieve this objective through the following activities:
a) On the demand side, by making economic, technical and financial opportunities at the provincial level available and accessible to young people. This is expected to lead to an increased interest of young people for rural entrepreneurship through the mobilization of institutional, professional, associative and private actors at local level;
b) On the supply side, by improving rural entrepreneurship services delivery through the establishment of an appropriate technical and financial support system specific to rural areas and dedicated to the youth, ensuring an individualized and on-site support, favoring the promotion of agri-enterprises, cooperatives and agricultural service companies and aiming to improve the sustainability of those already in place; and
c) On access to finance, by helping young rural entrepreneurs benefit from financial incentives provided by the GGS (incentives for start-up enterprises led by young people, for service companies and for agricultural land rental), and from existing credit access programs.
5. The implementation of RA1 would also build on the lessons learned from the World Bank funded project Supporting the economic inclusion of youth (P151169) which is piloting an innovative approach to entrepreneurship. This project provides capacity building and financial support to newly created and young businesses to improve chances of success and increase formal businesses’ survival rate. This includes both (i) business capacity support after beneficiaries create their businesses: supporting entrepreneurs for a period of 12 to 24 months, through individual coaching and group training sessions adapted to their needs, including those of female beneficiaries, covering a core set of business development services (for instance in financial and cash management, market development, compliance with administrative requirements and policies); and (ii) financial support to young entrepreneurs through the provision of small grants (non-refundable matching grants) up to US$10,000, covering up to 60 percent of the project’s investment plan (this may cover a diversity of capital and operating expenditures, including initial working capital and initial down payment for access to commercial financing).
6. Based on the above, RA 1 would be implemented around two Sub-Result Areas, organized sequentially to act as a channel with regard to information, orientation, selection and technical and financial support to young people towards developing their agri-enterprises.
7. Sub-Result Area 1.1 – Strengthening the ecosystem for rural entrepreneurship development. Under this Sub-Result Area, the Program will support the following set of interventions: (i) Improving the attractiveness of the rural economy for young people; and (ii) Strengthening the capacity of support institutions for rural entrepreneurship development.
8. Improving the attractiveness of the rural economy for young people:
a) Identification of economic opportunities at provincial level: Project portfolios would be developed along priority agriculture value-chains at provincial level, targeting both local and export markets. This would be achieved through financing specialized technical assistance and the mobilization of ONCA advisors who will be responsible for coordination between DRAs and business networks;
b) Communication and promotion around project opportunities: Regional communication campaigns as well as a national campaign would be organized based on an effective communication strategy targeting young people
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(media, promotion tours, seminars, open days, etc.). The campaign would include: (a) information related to the technical and financial services available for rural youth to initiate their projects; (b) a specific strategy to enhance participation and outcomes for women from project interventions under the overall goal of enhancing the proportion of women-owned enterprises in rural areas; and (c) awareness on climate change on the agriculture sector and potential mitigation/adaption measures;
c) Development and integration of rural entrepreneurial training modules in vocational training centers: Existing agricultural vocational training centers would benefit from this activity. Their capacity covering rural entrepreneurship development would be strengthened through: (a) the design of training modules on entrepreneurship and project management and their introduction in different cycles of the centers curricula; and (b) training of 60 trainers to strengthen their capacities in the delivery of training and advice on rural entrepreneurship development;
d) Organization of orientation and ideation sessions for rural youth: 90,000 young people (out of a total of 180,000 planned as part of the GGS) would benefit from this activity. The Program would organize individual sessions, seminars or workshops to enable the rural youth: (i) gain an understanding of the potential economic opportunities in their areas, and available technical and financial resources they can access to help them develop their ideas and finance these. It is expected that at the end of these orientation and ideation sessions, youth who would have developed ideas for climate-informed “bankable” projects would be selected to receive technical assistance for up to 18 months to support the implementation of their plans (including for selecting the appropriate technology, procurement, market linkages, developing lead-buyer supplier agreements in partnership with IFC, etc.). These sessions can potentially include the development of digital solutions for local agriculture challenges particularly those highlighted under Result Areas 2 and 3.
e) Launch of a pilot national call for innovative projects: A national competition would be organized yearly to encourage young innovators of digital and climate smart agriculture develop and implement their ideas. 50 projects would be selected from all regions and three would be awarded and supported in setting up their projects.
9. To enhance outcomes for rural women enterprise development, the Program will address their constraints (increased reliance on informal networks; limited mobility and access to public spheres; and cultural norms that promote their concentration in lower value “traditional food” sub-sectors). Interventions will include counseling and mentorship support adapted to women’s needs; ensuring an equitable participation of men and women in trade fairs; developing platforms and associations for women to facilitate networking amongst women entrepreneurs; delivering support services at convenient timings and locations to maximize participation of women; and tracking women-owned enterprises in higher value packaged and processed food enterprises.
10. Strengthening the capacity of support institutions for rural entrepreneurship development:
a) Capacity building of a pool of highly qualified agricultural advisers: 60 agricultural advisers (of whom at least 30 percent will be female) would be trained on management counseling and the management of incubators established with ONCA structures (at the Dar El Fellah level). These advisors would: (a) provide guidance to the Program beneficiary rural youth on existing services, economic opportunities, financial incentives, and will act as “facilitators” that match the demand and supply of technical services; and (b) support cooperatives and agri-service companies in managing and expanding their businesses;
b) Establishment of incubators (10) within the Dar El Fellah network to enhance their outreach capacity so that they can provide last-mile services to young rural entrepreneurs, cooperatives and other agri-service providers. This will include rehabilitation/construction of buildings, supply of equipment and provision of technical assistance;
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c) Pre-launch support for the Program beneficiary rural youth. 20,000 young people identified and selected during the orientation and ideation sessions would benefit from support to develop their project and related business plan. It is expected that, subsequently, 10,000 youth would obtain funding from commercial banks under existing credit access programs. The Program will finance the provision of a dedicated and hands-on technical assistance (technical services) to assist the beneficiary develop his/her idea, prepare a detailed bankable project and subsequent commercial loan applications. The TA would extend over a period of 3 – 6 months. It would include group training in entrepreneurship and business development, through practical exercises and personalized advice, as well as internships in companies and training in cross-cutting skills (gender, climate change, communication, etc.);
d) Revitalization and professionalization of agricultural cooperatives. The Program will support the organization by ONCA of 120 forums, with participation of all relevant institutional and key stakeholders with the objective to improve the cooperatives’ operational capacities and modernize their management capacity; and
e) Launch of a pilot initiative for the emergence and empowerment of agricultural service cooperatives for youth: The Program would support the creation through ADA of 10 service cooperatives (200 youth in total). These cooperatives would receive support in financial terms to acquire premises with the necessary materials and equipment and in the form of training and counseling for their members. They would serve to pilot state of the art technologies geared to promoting digital applications, including to provide advance warning for emergency events such as COVID-19.
11. Activities under Sub-Result Area 1.1 would be implemented under the oversight of MAPMDREF’s DSS and in partnership with the DRAs and ONCA.
12. Sub-Result Area 1.2 - Improving access to financial resources for young rural entrepreneurs. Activities under SRA 1.2 will facilitate access to finance for rural youth by encouraging commercial banks to scale up their outreach to this segment of entrepreneurs.
13. The Program will finance the following main interventions:
(a) Review of FDA’s incentive system and legal framework to specifically target young rural entrepreneurs. This would involve the promulgation of new legal texts favoring financial incentives benefiting projects promoted by rural youth; including access to agricultural land. In addition, the FDA may also provide incentives and subsidies to investors with job-creating projects. These proposed changes in FDA’s operations require the promulgation of new texts on the Agricultural Investment Code, to establish the necessary mechanisms for granting corresponding subsidies to beneficiaries;
(b) Establishment of a financial incentive mechanism for young people to start their individual projects: 16,000 young people would benefit from this mechanism, in accordance with the guidelines of the GGS, from year 3 of the Program, following the adoption of the new FDA legal texts (MEFRA/MAPMDREF joint orders) to that effect;
(c) Establishment of an incentive mechanism to support structured agricultural entrepreneurship: 800 service companies with up to 10 young people per company, i.e., 8,000 young people, would receive incentives in accordance with the guidelines of the GGS, from year 3 of the Program, following the adoption of the governmental degree to provide incentives for young entrepreneurs to start their rural investments; and
(d) Financial aid for the rental of agricultural land for the benefit of young people: 14,500 young people would receive incentives, in accordance with the guidelines of the GGS, from year 3 of the Program, following the adoption of the new FDA legal texts to that effect (MEFRA/MAPMDREF joint orders).
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14. The Program aims to (i) give adequate priority to initiatives predicated on eco-efficient and climate smart technologies, as well as technologies geared to reducing risk factors such as droughts, pests and diseases, and getting promoters equipped in the face emergency events such as the COVID-19 pandemic; and (ii) due attention to projects developed by young women, as they need special incentives to circumvent the constraints they face due to their vulnerable status, and get to have an even-playing field as they request financial support. Sub-Result Area 1.2’s implementation would be led by ADA, the DRAs and the decentralized entities of MAPMDREF, and the DF will be in charge of revising the texts that govern the FDA.
RESULT AREA 2 - IMPROVED EFFICIENCY OF AGRI-FOOD MARKETING SYSTEMS
15. Result Area 2 has two long term objectives: improved marketing on the local market, and increased exports of agri-products. It would support three sets of activities: (i) strengthening of the marketing and distribution of agri-food products on the domestic market, with a focus on the creation of four priority wholesale markets, and the development of e-commerce of local agri-food products; (ii) improving food safety management; and (iii) digitalization of the promotion and control process for exports. The activities under (ii) would be part of the measures taken by the GoM to deal with the fall-out of the COVID-19 pandemic and foster preparedness for similar sanitary crises in the future.
16. The evaluation of the PMV carried out by MAPMDREF in 2018 indicates that agriculture performance is still hindered by marketing constraints, particularly limited capacity for product innovation, and difficulties accessing modern marketing networks. It highlights the difficulty for small producers and SMEs to comply with stringent food safety, quality, traceability, labeling and environmental sustainability requirements imposed by high-value export markets. These constraints affect small producers’ ability to participate and benefit from the strong sector growth registered over the last decade and increase vulnerability to climate change through reduced livelihood opportunities. Hence, improving the efficiency of agri-food value chains through the development of modern wholesale markets, as well as the related food safety and sanitary issues ought to be addressed as a priority under the new GGS.
17. Boosting exports is considered one of the levers of agricultural development in the new GGS strategy, as much as taking advantage of the increasing demand on the domestic market. The GGS aims to double agri-food exports over the next ten years. One area of emphasis of the GGS to develop exports is to ease the constraints to the administrative and sanitary control process, as well as strengthen the economic intelligence on strategic external markets so that Morocco takes advantage of the opportunities to develop its exports on these markets.
18. The Program would support activities in three sub-programs:
a) Strengthening agri-food products marketing and distribution in the domestic market: This sub-program regards the construction of four new climate-proof and energy efficient wholesale marketing platforms and the establishment of an e-commerce platform. The new wholesale markets would make it possible to: (i) set up organized marketing circuits, and thus limit informal circuits which distort active competition and negatively impact the incomes of small and medium-sized farmers; (ii) provide traders and producers access to quality logistical services; and (iii) improve the quality and safety of marketed products in accordance with international norms and standards. The e-commerce platform would serve the needs of small agricultural cooperatives of local products from different regions of the Kingdom. It would enable them to improve the online marketing of their products, and connect also directly to the end consumer;
b) Strengthening the national food safety management system. The Program would focus on the upgrading of ONSSA’s central capacities and laboratories for plant and animal control. This would involve strengthening the sanitary status and safety of agri-food products, through the upgrading of the processing of requests for sanitary certificates and authorizations for small and medium-sized establishments (SMEs). Additionally, it would raise awareness about potential spread of new pests and diseases due to climate change impacts. It
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would involve also strengthening of the quality and sanitary status of agri-food products through the improvement in laboratory analyses in the fields of plant and plant products, animal and products of animal origin, residues of veterinary drugs and antimicrobial resistance; and
c) Improving agri-food export performance. The strengthening of Moroccan producers’ export performance and competitiveness is one of the pillars of the GGS. The Program would involve digitizing the control and monitoring procedures to enhance the traceability of agricultural and agri-food products intended for export. The Program would also involve improving access for Moroccan exporters to information and data relevant to target markets, and the regular update of these data. Access to this information would allow Moroccan exporters to better anticipate the development of their markets (regulatory or normative framework, competitive environment, etc.) and respond to their needs, as well as offer them the possibility of opening up to new markets with high potential.
19. Sub-Result Area 2.1 - Strengthening agri-food marketing and distribution in the domestic market. Sub-Result Area 2.1 would support three main sets of activities:
a) Promulgation of the regulatory framework for wholesale marketing platforms of agricultural products: the current regulatory framework governing the wholesale marketing of agricultural products dates back to 1962. It has become obsolete and presents several constraints penalizing the competitiveness of the agri-food sector. Hence, the development of a new generation of wholesale marketing platforms will require a revised legal framework governing this activity (via the amendment of the Organic Law regarding the municipalities), and the attendant publication of an Arrêté for its application. The Program would also support the preparation of the ESIA of the Schema National d’Orientation des Marches de Gros au Maroc;
b) Development of four new wholesale marketing platforms for agricultural products: The regions selected under the Program for the creation of the wholesale marketing platforms are those which are of strategic importance for the agri-food sector at the national level, namely Meknès-Fès (Meknès), Souss-Massa (Agadir), Marrakeh-Safi (Marrakesh), and the Oriental (Berkane). The completion of each market will go through key stages: the signing of the partnership agreement between the various stakeholders including local authorities and private partners, putting in place of a management structure for project management, the completion of the ESIA for each individual facilities, the construction of the platform, and finally support to its full operation. The Program would finance the related engineering and financial feasibility studies, construction, equipment, and bringing the market facilities to full operational level;
c) Development of electronic commerce of local products: This activity will involve developing an e-commerce platform for the benefit of 200 producer organizations of local products. It would make it possible to improve the scope of the marketing of these products and their visibility, both on the national and export markets, the pooling of costs (e.g., operations and maintenance, management, etc.) and logistics (e.g., storage spaces, delivery channels, etc.). It would also permit to boost the interaction between producer organizations and their clients.). The current COVID 19 crisis has shown that the development of local e-commerce platforms is serving to connect small agriculture producers directly to consumers. Solutions range from startups serving as the connector between producers and consumers by providing not only the platform but logistics services; all the way through consumers ordering directly from farmers via Facebook, Whatsapp, or SMS for delivery at farmers markets or wholesale markets. The e-promotion of local products by ADA would be based on the tagging of products with special labels emphasizing traditional eco-resilient local practices, energy conservation and limited use of chemicals; another marketing argument would be production at the local village-community level by smallholders, prominently women.
20. The following entities would be responsible to oversee the implementation of the above sub-programs: (i) regulatory framework for wholesale markets: MAPMREF’s DGCL and the Ministry of Interior; (ii) construction of
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wholesale markets: MAPMDREF’s DDFP, in close liaison with the Wilayas and other territorial authorities; and (iii) electronic commerce of local products: the Agence de Développement Agricole (ADA).
21. Sub-Result Area 2.2: Strengthening the national food safety control system. Sub-Result Area 2.2 would support two sets of activities with ONSSA:
a) Digitization of processes associated with the issuance of phytosanitary certificates: This regards the processing of requests for sanitary certificates and authorizations for small and medium-sized establishments (SMEs) with a target of 1,000 establishments certified in sanitary terms by ONSSA and issuance of related 8,800 certificates. The Program would also fund additional control visits for the follow-up of certified establishments in terms of health and sanitary status with a target of 15,000 additional control visits at the end of the Program; and
b) Upgrading of ONSSA laboratories for plant and animal control: This activity aims to strengthen analyzes by carrying out 1,250 additional analyses by 2025, i.e., an annual average of 250 additional analyses per year. It will involve upgrading and equipping three laboratories (Agadir and Tangier laboratories, and Control and Expertise Service belonging to MAPMDREF’s Division of Pharmacy and Veterinary Inputs) with efficient and adapted devices, strengthening laboratory skills, implementation and validation of certain analytical techniques, and execution of analytical controls. This activity would strengthen the quality of products through the improvement of official controls based on laboratory analyses in the fields of plant and plant products, animal and products of animal origin, residues of veterinary drugs and antimicrobial resistance.
22. The Program would fund the required technical assistance and equipment to achieve the above. ONSSA would implement this sub-program, in partnership with DRAs and territorial authorities.
23. Sub-Result Area 2.3 - Improving agri-food export performance. Sub-Result Area 2.3 would support three sets of activities with Morocco Foodex:
a) Technical control process of exports, and related issuance and management of export agreements: The sub-program would involve: (i) developing a digital platform to entirely process the requests for technical control of products intended for export and issue all related inspection certificates digitally by the end of the Program. This platform would be deployed initially with a sample of tomato exporters in Agadir before it is generalized to all sectors on a national scale. The use of the platform would result in reducing the processing time and the risk of error, and (ii) designing a digital platform, accessible to exporters for formulating their requests (new registration and/or renewal), monitoring the processing status of their files and obtaining their approvals directly via the platform. This is expected to result in diminished processing time and reduction of the risk of error linked to the manual of processing of registration and/or approval requests. The target under (i) and (ii) would be for Morocco Foodex to process all exporters’ requests by the end of the Program;
b) Monitoring export markets: The aim is for Morocco Foodex to acquire a new monitoring system capable of improving access for Moroccan exporters to relevant information on export markets, and, consequently, better anticipate the development of their target markets and also exploit the opportunities offered in new markets with high potential; and
c) Internal administrative functions: the sub-program would establish a digital Enterprise Resource Planning (ERP) system regarding Morocco Foodex internal administrative functions related to human resource management, personnel services and procurement, with expected gains in terms of efficiency, effectiveness and transparency. As with any digitalization process, success will be accompanied with a transformation in mindset towards the use of digital solutions that are more user focused. To this end, a Chief Digital Officer for Morocco Foodex would be in charge of leading the digital transformation.
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24. The Program would finance the required technical assistance and equipment to achieve the above; Morocco Foodex would implement this sub-program, in close liaison with MAPMDREF and the private sector.
RESULT AREA 3: ENHANCED DIGITALIZATION OF AGRICULTURE AND ADOPTION OF CLIMATE SMART PRACTICES
25. Result Area 3’s objectives are to improve the efficiency and effectiveness of agricultural support services; and enhance the environmental sustainability of agri-food value chains. To achieve these objectives, Result Area 3 would finance two main sub-programs: (i) developing the digital ecosystem for informed decision-making regarding climate smart-agriculture: this would include the definition of a comprehensive strategy for the digital transformation for MAPMDREF that ensures optimal synergies amongst its different operating systems, the digital transformation of research and information programs and the digitalization of the agriculture extension services delivered both by public (ONCA) and private service providers; and (ii) support to eco-efficient and climate-smart agriculture to improve the resilience of Moroccan agriculture in the face of climate change, with a focus on investing in water and energy efficiency in order to conserve natural resources and create new activities that generate income and employment. The above would enable producers and other actors along the value chains to engage in practices to edge against risks and be prepared for emergencies. Digital operations would enable producers to manage crop and animals remotely, hence acting as a barrier to the spread of diseases such as the COVID-19.
26. Sub-Result Area 3.1 - Developing the digital agriculture ecosystem. Sub-Result Area 3.1 would support the development and improvement of digital systems and tools to better inform decision-making in agriculture. The Program would fund the following twin set of activities:
(a) Study of options for MAPMDREF’s digital transformation and preparation of related digital blueprint: The diffusion of innovation, R&D and precision farming constitutes one of the structuring pillars of GGS. In this context, the Department of Agriculture has planned a study on its digital transformation. The preparation of this study is also part of the Morocco Digital Strategy regarding digital smart government practices. This digital transformation would capitalize on the achievements of initiatives carried out by the various structures affiliated with MAPMDREF (ONCA, ADA, ONSSA, IAV, INRA) and also those undertaken by other institutional and private partners (Université Mohamed VI Polytechniques—UM6P, Office Chérifien des Phosphates—OCP, Groupe COSUMAR, etc.). The digital transformation of MAPMREF will be accompanied by the development of various digital devices and systems to aid decision-making (e.g., digital platform for precision agriculture based on artificial intelligence, image processing by drones or satellites, phytosanitary risk prediction and mapping system, etc.), taking into account the necessity of a holistic approach in terms of efficiency, quality of services, pooling of activities and cost control. The deployment of certain systems will require punctually an adjustment of the regulatory framework governing the use of digital technologies (e.g., the use of drones). As the MAPMDREF and the sector move towards a more digitally-enabled sector, it will be important to assure a well thought leadership structure, with the appropriate skills. The MAPMDREF will benefit from having a person that can fill the roles of Chief Digital Officer and Chief Data Officer;
(b) Developing the digital ecosystem for informed decision-making regarding climate-smart agriculture. The Program aims to implement a new generation of digital support mechanisms to professionalize Moroccan agriculture, a central focus of GGS, in particular through the strengthening and modernization of research and information services to (i) promote eco-efficient and climate smart agriculture, and (ii) serve the needs of small producers who are still generating the bulk of agri-food supply, with a special focus on women who play a key role in certain sectors such as fresh fruits and vegetables. The Program will achieve these objectives through the following support activities with beneficiary institutions:
Activities with ONCA regarding the digitization of agricultural advisory services:
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- Establishment of a National Data Center for agricultural advice with regional relays: This activity will consist of setting up a central Datacenter and 10 regional Datacenters with the aim of (i) storing and managing the database of technical and economic benchmarks which constitutes the main source for the production of knowledge transferable by agricultural advice, (ii) mapping of offers in public and private agricultural advice, (iii) identifying territorial needs for agricultural advice; and (iv) collecting data linked to farmers, rural women and young beneficiaries of agricultural advisory programs;
- Equipment and capacity building of agricultural advisers on aspects linked to the digitalization of agricultural advisory activities: This will involve equipping agricultural advisers with digital devices (tablets, software, etc.) to enable them access Datacenters and also exchange platforms (e.g., ARDNA) in order to interact in real time with agricultural producers and provide local agricultural advice. This activity will be accompanied by capacity building for agricultural advisors in e-advisory services; emphasis would be placed on training advisors regarding special methods tailored to reach out to women producers;
- Upgrade of the "ARDNA" system: This activity will involve the launch of technical assistance for the upgrade of the virtual communication and advisory support platform "ARDNA", which today constitutes the platform benchmark for the management of agricultural knowledge, through the development and reorganization of the functionalities of this platform and its enrichment with practical support services for agricultural advice. The upgrade of this platform would make it possible to bring the number of its users (farmers, agricultural advisers, researchers, etc.) to 7,500 by 2025; and
- Establishment of a videoconferencing system and interactive terminals: The aim will be to set up a videoconferencing system at the level of the Agricultural Advisory Centers (CCA) to be equipped with interactive information and agricultural knowledge transfer terminals. These interactive terminals will be connected to the Datacenter set up and accessible to different users (farmers, agricultural advisers, researchers, etc.).
Activities with INRA: - Development of agricultural land use maps: The Program will finance the development of such maps over
an area of 500,000 ha, which will increase the total area mapped available nationwide to 7.5 million ha. This mapping will provide information on the potential of soils taking into account the agro-climatic parameters of the areas studied. It will be an important tool for planning assistance;
- Development of a digital platform for precision farming: Design and implementation of a digital platform and development of methods for spatial monitoring of crops, based on artificial intelligence, image processing (drones or satellites) and on agronomic calibration tests for effective spatio-temporal monitoring of crops;
- Creation of a Big-Data Center: Creation of interoperable gateways between the different platforms already existing at INRA for the creation of Big-Data, able to allow cross-checking and cross-analysis between data and information from different databases (fertility map, soil use, climate data, etc.). A web platform will be set up and will be accessible to researchers, agricultural advisers and professionals. INRA will network its soil and plant protection laboratories to provide updated data on a national scale. This platform would provide open access to different stakeholders and provide data for startups to develop local digital solutions. Broadly, studies have shown that for startups in the digital agriculture space 80 percent of the initial costs are for data collection. Thus, an open data platform will significantly reduce the barrier to entry for the development of data driven digital solutions;
- Project for estimating the area of crops based on time series of satellite images and machine learning methods: Acquisition by INRA of the necessary equipment (software and hardware) and implementation of a survey system based on the analysis of time series of satellite images. This project will initially concern six crops, including four annual crops and two perennial plantations before its generalization to other crops.
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The above support would enable INRA to make major headways regarding experimenting and designing solutions in such areas as eco-efficient cropping and water saving in the context of climate change;
Activities with ONSSA: - Seismic detection of red palm weevil larvae: Equipping 15,000 palm trees with a “Palmonitor” seismic
detection system of red palm weevil larvae. This project will enable ONSSA to detect larvae early in the palm infection, streamline the treatment operation by targeting only infected palm trees, and also reduce the risk of spreading this disease;
- Geographic Information Systems (GIS) and satellite image processing: Acquisition and implementation of a GIS and a satellite image processing system. These systems would allow ONSSA to better program prospective operations based on the precise location of outbreaks due to plant and animal pathogens, follow the real-time evolution of the spatiotemporal development of levels of infestation, and delimit quarantine geographic zones, buffer and free of phytopathogenic agents to meet the requirements of international standards of phytosanitary measures. It will also generate geographic representations and ONSSA performance reports by area of activity and by region;
- Machine learning solution for the detection of plant diseases based on images: Acquisition of a remote detection solution for plant diseases based on artificial intelligence, in particular machine learning based on picture. This solution will allow plant protection services to carry out remote prospecting for diseases, detect infected plants and target the farms to be treated. It will also increase climate change resilience through early warning;
- Use of drones for phytosanitary treatments: Acquisition of drones for phytosanitary treatment of an area of 4,000 ha of tall or inaccessible plantations (palm and forest);
- Establishment of a phytosanitary risk prediction and mapping system: Acquisition of a computer system for predicting and mapping potential phytosanitary risk distributions. This system would make it possible to predict the potential distribution of exotic harmful organisms, to map the probability of the potential introduction and establishment of harmful organisms and to ensure better orientation of phytosanitary surveillance means in the field; and
- Establishment of a videoconferencing system and interactive terminals: The aim will be to set up a videoconferencing system at the level of the Central Directorate of ONSSA and also of the Regional Directions of the Agricultural Council.
Activities with DIAEA, ADA and IAV: - Installation of remote reading and remote management systems (DIAEA in liaison with ONCA and ORMVA):
The establishment of these systems would make it possible to control and control remotely (from a central unit), the hydraulic devices at key points in the networks, to rationalize the collection of charges for water actually consumed by farmers, and to reduce the human resources needed to manage the modernized sectors.27
- Study of definition of a digital transformation model / concept of an aggregation project (ADA): preparation of a study of definition of a digital transformation model / concept within the framework of an aggregation project, by capitalizing in particular on the digitalization of the sugar industry by COSUMAR.
- Creation and launch of a training specialty in Data Science applied to agriculture (IAV): Launch of a training course in Artificial Intelligence applied to agriculture entitled "Data Science in Agriculture". Aimed at
27 The activity would include providing technical assistance to DIAEA though ORMVA and ONCA to enable support to producers in modernized irrigation areas. Around 20 agricultural advisers would receive in-depth training and would provide detailed advice in water management techniques and water saving agricultural practices. The beneficiaries of this activity would be 30,000 producers and their families practicing irrigated agriculture in the 63,000 ha covered by the activity. Most of these are smallholders farming 2 ha or less.
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Agronomy students, this training will allow them to acquire the knowledge necessary to qualify for a job as a research manager (statistics, marketing, big data, IoT) or scientific expert (data scientist, machine learning, deep learning). After accreditation of this new specialty, 10 engineers will graduate in Data Science per year, of whom 20 under the Program.
27. Sub-Result Area 3.2: Support for eco-efficient and resilient agriculture. In support of eco-efficient and resilient agriculture, the Program would finance the following twin activities:
(a) Technical assistance to support farmers in modernized irrigation sectors: This sub-program would consist in providing 30,000 producers within six already modernized irrigation schemes (converted to drip irrigation), with technical assistance and local support for the adoption of additional climate smart agriculture to maximize the benefits of the drip irrigation technology. This initiative will help promote more efficient and sustainable management of water and land and strengthen the resilience of projects to climate change. Concretely, it will involve investing in water and energy efficiency in order to conserve natural resources and create new activities that generate income and employment; and
(b) Pilot initiatives for the promotion of agroecology and organic farming: Launch of two pilot initiatives for the benefit of 200 farmers in vulnerable and fragile areas, in particular the areas of Oasis, Mountains and unfavorable rainfed areas for promotion of sustainable and resilient agriculture, based on the principles of agroecology and organic farming. A group of 100 producers will benefit from support for the adoption of agroecological practices, such as direct seeding, rainwater harvesting, the use of solar and biomass energy, the production and use of organic fertilizers, etc. A second group of 100 producers will receive support for the adoption of organic farming practices. The beneficiaries of these two initiatives will act as a relay for the dissemination of these practices to other farmers.
B. TECHNICAL ASSESSMENT
28. The design of the Program was informed by recent evaluations and analytical work. It benefitted from the results and the recommendations of the recent evaluation of the PMV carried out by MAPMDREF in 2018. It also benefitted from recent sector work carried out by the Bank28, as well as other partners such as the Food and Agriculture Organization of the United Nations (FAO)29.
29. The Program’s design rests on solid technical bases. Those include the analytical work and diagnostics carried out specifically for the preparation of the PMV and successor GGS, and the experience that Government has acquired during the PMV implementation in developing and implementing sectoral policies, strategies and action plans, in working with farmers, their organizations and agribusinesses, in facilitating public-private dialogue and collaboration, and in strengthening public institutions serving the agricultural sector. The Government has clearly shown ownership of its sector policies and strategies throughout PMV implementation, under the leadership of MAMPDREF. The Program design also integrates the lessons from existing evaluations of Bank and other donor-financed support to the PMV, Government’s own evaluation of PMV implementation until 2015, and it draws from the large body of studies available about selected value-chains (including the Bank’s ongoing programmatic sector dialogue in agriculture in Morocco). The Program also includes some of the lessons learned through the Bank’s global experience with similar operations, such as the need for a strong institutional champion (the Program relies on solid leadership by MAPMDREF) and demonstrated continued support from central ministry’s policy making and oversight functions.
28 Diagnostic on Digital Agriculture in Morocco (2019) and Morocco Climate Smart Agriculture Investment Plan (2018). 29 Morocco: Investing in collective action – Opportunities in Morocco’s agri-food system, final draft, FAO and EBRD, June 2017.
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RESULT AREA 1 – INCREASED JOB OPPORTUNITIES AND INCOME GENERATION FOR RURAL YOUTH
30. While most economic opportunities in rural areas will remain in agriculture in the foreseeable future, youth are losing interest in sector activities. The lack of interest of youth for rural jobs is not only predicated on their lack of attractiveness in terms of hardship and work environment. It is also contingent on the risks and challenges they face in developing their enterprise. Hence the record of high failure of rural enterprises. In rural areas, youth are more likely to fail as entrepreneurs. As shown by many studies, failure rates are higher for younger and older entrepreneurs than for middle-aged owners, and higher for female-owners than males. Firm death rates are highest for firm owners with no education, and then fluctuate with no simple pattern among firm owners with some education30. The above is particularly relevant for Moroccan youth. Indeed, according to the latest Labor Force Survey (HCP, 2018), 42 percent only have completed primary school. To succeed as entrepreneur and given their profile, youth in rural areas require a curriculum adapted to a lower level of education, and more intensive training programs. Anecdotical evidence suggests that ideation is also an important part for this population as they tend to mimic others’ ideas without any consideration of markets and/or alignment between their expertise and the business. This may partly explain the high rate of business bankruptcy among youth.
31. Entrepreneurship in rural areas is facing a number of barriers. Some 750,000 young people operate very small businesses (around 17 percent of young employed workers), but most do so out of necessity. This proportion also remains very low compared to other countries. Several factors explain this low participation of young people in entrepreneurship but also the lack of dynamism of these very small businesses: (i) a lack of entrepreneurial spirit, (ii) a lack of structures to support entrepreneurship in rural areas, (iii) limited access to finance for these young people, who have neither guarantees nor collateral to access a loan, (iv) limited access to land for young people wishing to develop their agricultural holdings, and (v) an agricultural sector perceived by young people as a subsistence activity and not as a buoyant income generating sector.
32. In Morocco as elsewhere many projects have focused on rural entrepreneurship. While some were more successful than others, one commonality is the importance of access to finance which requires sound and bankable business plans. Young rural entrepreneurs who are approved to receive a commercial loan will receive technical assistance for 12 months to support the implementation of their business plans. These will receive direct assistance in selecting the appropriate technology, procurement, market linkages, developing lead-buyer supplier agreements, and in general making optimal use of their commercial loan financing. To enhance outcomes for women entrepreneurs, the Program will address their specific constraints31 by including additional counseling and mentorship support for women; supporting their participation in trade fairs; developing platforms and associations to promote networking amongst women entrepreneurs; ensuring that all support services are delivered at convenient timings and locations to maximize participation of women; and tracking and promoting women-owned enterprises in higher value packaged and processed food enterprises.
33. Effectiveness of Youth Employment Programs, Including in Rural Areas. Most effective approaches for youth employment programs are comprehensive, underpinned by multipronged strategies with complementary interventions aimed at removing both supply- and demand-side constraints and market failures, including influencing job creation and work opportunities for youth (offered by firms and through self-employment), labor markets characteristics, and labor supply (skills and labor attributes). Demand-side exclusive interventions could also be effective, as demonstrated by the European Union Youth Employment Initiative that targets young people not in employment, education, or training
30 McKenzie D. and Pauffhausen A.L., Small Firm Death in Developing Countries, forthcoming. 31 For instance, reliance on informal networks; limited mobility and access to public spheres; and cultural norms that promote their concentration in lower value “traditional food” sub-sectors.
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(NEETs) through internships and hiring support schemes32. Moreover, a systematic review conducted by the World Bank Independent Evaluation Group (IEG) of 38 impact evaluations of youth employment programs found that factors increasing their success probability – on top of presence of complementary interventions – include participation of the private sector and personal monitoring and follow up of individual participants33. In rural low-income areas, where most youth are active in agriculture and non-farm employment or self-employment, stimulating the market environment for growth of farms and rural agribusinesses has proven essential. Zooming in on entrepreneurship trainings supported by World Bank operations in rural areas, positive impacts were demonstrated in Uganda and Colombia. More specifically, the participants of the Youth Opportunity Program in Northern Uganda, which provided unconditional cash grants to underemployed youth groups to pay about 10 weeks of full-time vocational training, tools, and business startup costs, reported a 45 percent increase in net earnings compared to their status before enrolling in the program. In Colombia, the Bank-supported Young Rural Entrepreneurs training program increased participants’ employment rate by about 14 percentage points compared to the control group. At the same time, other similar programs elsewhere have demonstrated mixed results, and the paucity of project data limits the ability to make any generalized statements on the impact of interventions targeting youth employment on broader labor market outcomes.
Figure A3.1 Demand and Supply Sides in Youth Employment Projects
Source: Adapted from Solutions from Youth Employment (2017). New and Promising Approaches in Youth Employment Programs.
34. The Program would build on the lessons learned from the World Bank-funded project Supporting the economic inclusion of youth (P151169) which is piloting an innovative approach to entrepreneurship. This project provides capacity building and financial support to newly created and young business to improve chances of success and increase formal businesses’ survival rate. This includes both (i) business capacity support after beneficiaries create
32 A recent evaluation of the YEI implementation in Portugal found a positive and long-lasting effect on the individuals’ labor market outcomes, as per Duarte, N., Geraci, A., Granato, S., Mazzarella, G. and Mortagua, M.J., The evaluation of the Youth Employment Initiative in Portugal using Counterfactual Impact Evaluation Methods. Publications Office of the European Union, Luxembourg, 2020. Available at: https://ec.europa.eu/jrc/en/publication/evaluation-youth-employment-initiative-portugal-using-counterfactual-impact-evaluation-methods. 33 IEG, 2012. Youth Employment Programs: An Evaluation of World Bank and IFC Support. Available at: http://ieg.worldbank.org/sites/default/files/Data/Evaluation/files/ye_eval.pdf.
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their businesses: supporting entrepreneurs for a period of 12 to 24 months, through individual coaching and group training sessions adapted to their needs, including those of female beneficiaries, covering a core set of business development services (for instance in financial and cash management, market development, compliance with administrative requirements and policies); and (ii) financial support to young entrepreneurs through the provision of small grants (non-refundable matching grants) up to US$10,000, covering up to 60 percent of the project’s investment plan (this may cover a diversity of capital and operating expenditures, including initial working capital and initial down payment for access to commercial financing). The operationalization of the proposed activities under this entrepreneurship program are realized through a network of Business Development Services Providers (BDS), selected through a competitive bidding process. In order to ensure successful project implementation, technical assistance is provided under the project to support the actors in charge of the entrepreneurship support program at central, regional and provincial level.
35. The Program design was also informed by the lessons learned from past experiences in Morocco, including:
(a) Matching training program with employment in agriculture project - Projet Adéquation Formation-Emploi en agriculture (1991-94): MAPMDREF, with technical support from FAO and funding from UNDP, implemented a project regarding matching training and employment, and increased entry rates for graduates into the labor market. This program unfortunately was not sustained for the following reasons: (i) the agricultural vocational training establishments, and a fortiori the Training-Employment Equality Units that had been created there, did not have the status and scope that would have enabled them to assume their role vis-à-vis other partners, and (ii) the program put an emphasis on pre-creation capacity building but did not address access to finance as incentives and post-creation support;
(b) ALEF project (2008-2010): ALEF was carried out in 2008 over a period of two years by the Department of Agriculture and Marine Fisheries in collaboration with USAID. In collaboration with the Department of Education, Research and Development, ALEF developed tools and mechanisms aimed at improving the employability of agricultural laureates and their integration into the labor market. In order to strengthen the intervention capacity of agricultural vocational training institutions, the project set up a program of training of trainers and developed new tools to support the integration and creation of agricultural enterprises;
(c) Promotion of Youth Employment in Rural areas Project – Projet Promotion de l’Emploi des Jeunes en Milieu Rural (PEJ). The project, operated by the Ministry of Employment and Professional Insertion (Ministère de l'Emploi et de l'Insertion Professionnelle, MTIP) and ANAPEC with the support of GIZ, has developed an integrated approach to promoting employment in rural areas based on: (i) observation of the labor market at the local level and dialogue at the provincial level, (ii) expansion of the network of information and guidance centers for employment in order to accompany youth in their job search, facilitate their placement and support young entrepreneurs, and (iii) improvement of employability, in particular through short-term training adapted to the rural context. The support is provided by NGOs. In the first phase of the project (2015-2017), around 2,500 young women and men aged 15 to 35 who were unemployed or underemployed benefited from the project and 47 percent of the supported young people found a job or were able to increase their income;
(d) The Moukawalati program. This program, operated by the ANAPEC, was launched in 2006 to assist business creation. It was initially intended for young Moroccans, aged between 20 and 45 years, holding a diploma. In 2010, it was extended to young people without a diploma. The program includes five implementation stages: reception and registration of youth, pre-selection of the candidate, final selection by the regional committee of the "Moukawalati" program, support of young entrepreneurs, and monitoring and evaluation of the support. The project was moderately satisfactory with a low success rate of business creation explained by: (i) selection of beneficiaries who were lacking entrepreneurial mindset, (ii) the problem of land tenure, (iii) the low quality of the business services providers; and
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(e) Young Agricultural Entrepreneurship Promotion Project (YEPP). This project was financed by the African Development Bank (AfDB) and aimed to promote entrepreneurship among young farmers. The project was executed by the Agricultural Development Agency (ADA) supported by technical assistance from the United Nations Office for Project Services (UNOPS). The project objective was twofold: promote employment opportunities, and support 160 micro-enterprises through training, integration and technical advice to selected young agricultural entrepreneurs which ended with access to finance with the Credit Agricole du Maroc. While the project aimed at nurturing high potential microenterprises with technical assistance and access to finance, in practice, very few projects obtained a loan with CAM.
RESULT AREA 2: IMPROVED EFFICIENCY OF AGRI-FOOD MARKETING SYSTEMS
36. The wholesale markets network in Morocco includes 38 municipal markets faced with decaying infrastructure, inadequate management, limited marketing services and sanitary conditions which require improvement. This situation remains a significant issue. Dysfunctional wholesale marketing and distribution systems, for fruit and vegetables, in particular, result in negative impacts on producers’ incomes, marketing costs, high final prices for consumers and the development of informal market. The 1962 wholesale marketing regulatory framework is outdated. Indeed, the Charte Communale stipulates that municipalities have a monopoly on decisions regarding the establishment and management of fruit and vegetable wholesale markets in their jurisdictions. Prices are in principle set by the market management and a fixed tax of 7 percent on the gross sales value of each transaction is levied by the communes at the markets, which penalizes high-value products. These fixed taxes represent a high share of municipal budget resources.
37. The lack of uniform rules governing the operation of markets and the inadequate reinvestment of market revenues have contributed to an inappropriate management and a deterioration of the physical and sanitary condition of Moroccan wholesale markets. Furthermore, current regulation prohibits farmers and traders from selling directly to food retailers and supermarkets in urban communes. As they often lack the resources to transport their products to distant wholesale markets they are often first traded in a wholesale market closer to the farm where the tax is levied, before being marketed through a second wholesale market of the commune where the retailer is located which levies an additional tax before selling to the retailer. The current system reduces producer revenues due to high transaction costs, but also increases final prices for consumers, which hurts the urban poor disproportionately. It weakens incentives for value addition, constrains producers’ integration in value chains, and distorts domestic trade flows. This context has additional consequences with the development of informal markets, and new competitive distribution channels (hyper and supermarket chains). The National Strategy for the Development of Wholesale markets in Morocco estimated that 65 percent of domestic fruit and vegetable production and consumption are marketed through informal channels (2010). Finally, domestic producers are in a disadvantageous position since importers are allowed to market imported produce directly to retailers after paying the fixed transaction tax of 7 percent at entry. This current state of wholesale markets regulation constrains the food system from delivering on its key outcomes: access to affordable, safe and nutritious food; agri-food jobs and livelihoods in agriculture, industry service sectors of the economy; sustainable, resilient and resource-efficient operations.
38. The Government undertook a set of measures to improve institutional regulatory framework and upgrade wholesale market facilities. In 2010, a national strategy and action plan were adopted for the restructuring of fruit and vegetable wholesale marketing (Schema National d’Orientation des Marchés de Gros de Fruits et Légumes), which has been updated in 2018. The strategy includes: (i) an overall plan for reducing the number of wholesale markets (Schéma d’Implantation des Marches de Gros) in a manner which takes into account the projected evolution of domestic production, consumption, and trade trends until 2020; (ii) the identification of viable wholesale market ownership and management models, including required institutional and regulatory adjustments; and (iii) necessary accompanying
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measures for the implementation of the National Strategy. Its implementation has been delayed as the modification of the legal framework governing wholesale food marketing and decentralization are still at the design stage. Nonetheless, with World Bank support provided under the previous PMV DPF series, national, regional, and local government stakeholders have gradually converged on a viable ownership and management model for wholesale market infrastructure. Indeed, the World Bank-financed “Strengthening Agri-food value chains Program” supports the development of a pilot wholesale market project in Rabat to transfer the markets of the municipalities of Rabat and Salé Kenitra, while introducing a new management model.
39. The experience of the Rabat wholesale market highlights recurrent constraints for the development of sustainable and efficient wholesale markets. The Rabat market was designed to have a demonstration effect. The World Bank-financed PforR Strengthening Agri-Food Value Chains (P158346, FY18) supports the new wholesale market to enhance the transfer of international best practices in terms of: (i) business model, no longer relying on fee-based tax collection by proxies, but on charging a cost of using the public space based on the areas, entries, or services use, and (ii) management model based on the responsibility of a Société de Développement Local (Local Development Company, SDL), an autonomous entity capable of reinvesting revenues, accessing bank loans, and recruiting professional market management teams. The construction of the Rabat agri-food platform has been delayed due to a change in site location in the spring of 2019, the delay to create the Local Development Company and to recruit the management team. The design and the size of the market are now agreed, and a specific agreement is finalized and will be signed by all participating entities as soon as possible. This experience underlines the understanding by Moroccan authorities of a need for changes in the institutional and regulatory framework, a strong technical assistance to follow the entire cycle of the projects and adherence to good governance practices.
40. Wholesale market development and upgrading is a GGS priority. The GGS aims at developing 12 wholesale markets considered as strategic infrastructure for agriculture development in Morocco to support food distribution systems and enhance food safety and products quality. The Program financed under this PforR would include technical and financial assistance for the upgrading of four wholesale markets tentatively located in Meknès, Agadir, Marrakesh and Berkhane. These locations respond to local needs as they are: (i) important areas of fruits and vegetables production (e.g., Meknès Tafilalet Region represents 12 percent of national production; Souss Massa Draa Region 23 percent; Oriental Region represents only 6 percent) and (ii) important consumption basins (e.g., 80 percent of national consumption of fruits and vegetables is concentrated in the North and the Centre of Morocco - Meknès: 630,000 inhabitants - Agadir: 420,000 inhabitants and Berkane: 110,000 inhabitants). The main preliminary studies have been already completed, and the preparation of feasibility studies are ongoing in Meknès, Marrakesh and Agadir, demonstrating the strong involvement of local authorities. The Agadir project is the most advanced (land selected, pre-feasibility study completed, ongoing finalization of technical-financial feasibility studies as well as a preliminary impact assessment study), and a first consultation with the main potential users of the platform started in September 2020. Based on the current timeline, the construction of the wholesale market is expected to begin by 2022.
41. Initial reform actions are a prerequisite to enhance operational and financial sustainability of wholesale market facilities. The National Strategy recommendations and the Rabat wholesale experience reveal that initial activities are necessary to formulate a sustainable program of wholesale markets. The Program will support the following initial measures: (i) the promulgation of the new institutional and regulatory framework for the organization of the national wholesale market network and wholesale trade of agricultural products, which is essential to guarantee the efficient operational management of new generation wholesale markets; the main orientations would promote a sustainable business model no longer relying on fee-based tax collection by proxies, but on charging a cost of using the public space based on the areas, entries, or services used, ending municipalities’ monopoly on decisions regarding the wholesale markets in their jurisdictions, and a transition from a monopoly to a competitive market; (ii) the implementation of new management models for individual wholesale markets based on territorial partnerships with
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interested communes and regional authorities; and (iii) an ESIA of both the National Strategy and the four selected markets to ensure compliance with E&S requirements in relation with wholesale markets. The above steps would be required to initiate the construction of the four wholesale markets consisting of: (i) technical assistance for the preparation of feasibility studies, business plans, and detailed designs and construction supervision plans; (ii) completion of civil works; and (iii) operational guidance for start-up of activities. Finally, the Program would support the development and implementation of a social management plan, which would accompany the closing of the existing wholesale markets being relocated with a view to proactively manage any adverse social impacts, in particular on current proxies, operators, communities, and public employment linked to the existing wholesale markets.
42. Wholesale markets infrastructure can be considered as socio-economic development instruments. Wholesale markets are public infrastructures built to serve the country’s private business interests and consolidate its food supply. A change in the wholesale market’s business model relying on fee-based tax collection by proxies is needed to address the anticipated decrease of municipal resources. Under the new business model, local authorities will be remunerated as shareholders on the base of dividends generated by SDL or other management structures. These infrastructures need to be considered as socio-economic development tools to improve food safety, nutrition, food supply but also local development and territorial attractiveness. Efficient wholesale markets will benefit local communities as they improve sustainability of agriculture products distribution, concentrating in the outskirts of the cities an important part of negative environmental and traffic impacts. They create jobs and enhance social integration of unskilled workers.
43. Political, technical and commercial risks will be effectively managed to ensure the successful launch of the new wholesale markets. First, the closure of existing wholesale markets and their transfer to new sites are delicate operations because they lead to a profound change in the interactions between market users. The inability or lack of political will of public authorities to enforce this transfer has resulted in the failure of many wholesale markets in other countries. It is critical that (i) municipalities on the territory of the existing wholesale markets (i.e. Marrakesh, Agadir, Meknès and Berkane) have a clear commitment to close these markets as soon as the new markets become operational; (ii) the Wilayas do not allow the opening of any competing wholesale markets on its territory; and (iii) public authorities and new management structures enhance the consultation/association of market operators; it is crucial to obtain the involvement and participation of the private operators who will be the future users of the platform. Second, it is essential that the new management structures of the markets are created and made operational as soon as possible. Best international practices consider a key factor of success the early involvement of the new management structure in all initial phases of the project, including promotional activities, signing of contracts with users and service companies and defining the tariffs and internal rules of the market. Furthermore, technical assistance from an international market management company, including study tours, is crucial to build capacity of future management teams, to guide them during the project development and start-up of the operations. Technical support will be provided during the detailed infrastructure design, the construction phases of the project, but also the first years of market operations.
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Table A3.1: Management models of several agri-food platforms in Europe
44. International benchmark of management models—The majority of wholesale markets world-wide are public or semi-public (83 percent) entities, as data from the World Union of Wholesale Markets (WUWM 2018) show based on its 141 members. There are also examples of purely privately-operated markets, including, for example, Saint Charles in Perpignan and Lyon (Lyon-Corbas). On the other hand, retail market management is mostly private or semi-public (57 percent). The general trend is in the direction of a relative autonomy of the management companies from local or national authorities, in order to make management more agile and ready to adapt to the speed of changes in the sector. In Germany, for example, the management of the markets originally all managed directly by the cities, changed gradually to private management models (see Table A3.1 above).
45. The COVID-19 pandemic has provided an opportunity for new digital agriculture online markets to rapidly grow. Food supply chains have been transformed as traditional distribution channels from producers to large consumers, like restaurants, hotels, catering companies, schools, have closed in many countries as a result of strict lockdowns and social distancing. Online agriculture markets and ecommerce platforms have emerged. From companies providing grocery and food delivery to platforms that connect small farms/producers directly to consumers, digital technologies are providing opportunities that can be further developed to lower logistic costs and increase the price producers receive for their products.
46. Food safety and quality are closely connected and essential elements to improve the added-value of agri-food products. Whereas food safety refers to all hazards that may make food injurious to the health of the consumers, quality includes all other attributes that influence a product’s value to the consumer. This includes both negative (such as spoilage, discoloration, odors etc.) and positive attributes (such as the origin, color, flavor, texture, and production or processing method of the food). Food safety can therefore not be viewed as a totally independent aspect from quality. However, the complexity of both concepts has brought the need of managing food safety and quality aspects separately.
47. ONSSA is considered at international level as a credible official agency for all aspects concerning the safety of agri-food products in Morocco. Since its creation and the adoption of Law no. 25-08.of 11 February 2010, which empowers it to carry out its mandate, ONSSA has adopted a number of decrees so that Moroccan food safety regulations have practically incorporated much of the recent EU law in this area. As for its strategy, the Office is working on the implementation of its 2015-2020 business plan. From the outset, it opted for a quality management system integrated at all levels of the organization: ISO 9001 for central administration and all regional directorates, ISO 17020 for regional inspection services and ISO 17025 for laboratories.
48. The activities selected for support under the Program would aim at addressing critical areas for the improvement of food safety in Morocco, thereby accelerating the implementation of the key provision of Law 28-07.
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In line with international experience, and considering the relatively low awareness of Moroccan consumers about food safety issues, the Program includes actions targeting both the demand-side (consumer demand for safe products) and the supply-side (agri-food producers and processors’ compliance with food safety requirements), while also strengthening the capacity of ONSSA to carry out its mandate.
49. Morocco has strong potential to seize growing export opportunities. First, Morocco enjoys geographic proximity to the EU and improved market access thanks to the recently adopted agricultural FTA34. Second, the country’s smaller farms (the average size of a family farm in Morocco is only about 2 hectares), in combination with competitive unit labor costs, lend themselves well for more labor-intensive organic production systems. Lastly, the Government has made important progress in recent years in establishing a supportive legal and institutional framework for building organic agri-food markets domestically35.
50. Morocco Foodex (Etablissement Autonome de Contrôle et de Coordination des Exportations) is a public entity placed under the supervision of MAPMDREF. Founded in 1986 following the liberalization of the export marketing of agri-food products, Morocco Foodex has four main functions: (i) Technical quality control of export of food product against standards required by the recipient countries; (ii) Export coordination consisting in facilitating specialized sectoral coordination committees which bring together producers - exporters and institutions of the export agri-food sector; (iii) Strategic monitoring of export markets for improved decision-making by export actors; and (iv) Export promotion through the participation in international fairs and exhibitions, organization of Business-to-Business missions and implementation of communication campaigns. The value of Moroccan food export in 2018 was US$6.1 billion with fruits and vegetables representing about 40 percent (i.e. US$1.21 billion for fresh fruit and US$1.27 billion for vegetables). As part of its ongoing digital transformation, Morocco Foodex has planned to digitize some key processes associated with the above functions. Among those, the following have been retained under the PforR: (i) delivering of export authorizations for food products and for individual exporters in digital form; (ii) digitizing the strategic monitoring of export markets in terms of price, quantity and quality standards; and (iii) digitizing the internal administrative functions of Morocco Foodex by introducing an Enterprise Resource Planning (ERP). To successfully manage the proposed digital transformation, Morocco Foodex will benefit from having a Chief Digital Officer that can lead the changes and focus in developing the appropriate solutions which are user-oriented.
RESULT AREA 3: ENHANCED DIGITALIZATION OF AGRICULTURE AND ADOPTION OF CLIMATE SMART PRACTICES
51. Climate Smart Agriculture. Recognizing the vulnerability of African countries to climate change and the importance of managing its impacts on agriculture, the Initiative for the Adaptation of African Agriculture to Climate Change (AAA Initiative) was initiated by the Government of Morocco in the run-up to COP 22, held in Marrakesh in 2016. The AAA initiative supports development of Climate-Smart Agriculture Investment Plans (CSAIPs), addressing the “triple challenge” of increasing productivity and food security, improving resilience to climate change, and contributing to climate change mitigation, where possible. A CSAIP has been prepared for Morocco. The CSAIP builds on a track record of achievements under the PMV and has been developed within the framework of national sector investment programs in water and agriculture. This first version of the Morocco CSAIP has selected projects according to their contribution to CSA, as well as ease of implementation, broader economic feasibility, innovative aspects and socio-economic
34 Under their Association Agreement which entered into force in March 2000, the EU and Morocco established a Free Trade Area liberalizing two-way trade in goods. They have subsequently developed the FTA further through an agreement on trade in agricultural, agri-food and fisheries products and a protocol establishing a bilateral dispute settlement mechanism both of which entered into force in 2012. 35 On February 21, 2013, Morocco established its legal framework for organic products and published the law 39-12 in the Official Bulletin 6128. The law 39-12 regulates the production, processing, marketing, and labeling of organic products. The implementing Decrees and Arrêtés have been developed and are awaiting publication in the Official Bulletin. Currently, organic products in Morocco are certified in line with international organic standards and certification requirements. The certification bodies currently operating in Morocco that have been accredited in line with international accreditation requirements include Ecocert, CCPB, Lacon, Bioagricert, Bureau Veritas, and Ceres Certification.
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importance. The projects focus on scaling-up ongoing climate-smart projects, new projects focusing on climate-smart agriculture and capacity building projects. One of the activities proposed as part of RA3 had been selected in the CSAIP (advisory services for drip irrigation schemes).
52. Digital Agriculture. A diagnostic of the digital agriculture potential of Morocco was prepared in 2018-19. The main technologies analyzed as part of the diagnostic included (i) cross-cutting technologies such as computational decision and analytics tools, the cloud, sensors, block chain, robots and digital communication tools; (ii) field-based activities enabled by geo-location technologies such as Global Positioning Systems (GPS), geographical information systems, yield monitors, precision soil sampling, proximal and remote spectroscopic sensing, unmanned aerial vehicles (drones), auto-steered and guided equipment; (iii) animal-focused technologies including sensors and radio frequency identification (RFID chips) and automated (robotic) milking and feeding systems, among others, and (iv) controlled-environment agriculture (greenhouses, indoor farms, etc.), enabled by digital technologies such as sensors and robots.
53. The diagnostic conclusions suggest that (i) Morocco is just starting the digital transformation process of the agriculture sector and that process is promoted by both private and public sector; (ii) the potential for growth in digital agriculture is significant; (iii) as in other more advanced agriculture sectors, research and development of digital solutions is in the hands of the private sector; and (iv) the public sector has a clear mission in ensuring that these new technologies contribute to improved equity, sustainability and efficiency of agriculture activities. Fulfilling this mission requires acquiring a good knowledge of these technologies in order to be able to regulate their use with a special attention to data access and management, promote awareness and demonstration, build and improve the necessary rural infrastructure, foster digital supply capacity by domestic startups and SMEs, disseminate digital knowledge and improve academic curricula to address the market demand for digital expertise.
54. Under the Program, MAPMDREF would spearhead an ambitious reform agenda expected to accelerate digital agriculture and modernize the agri-food system in Morocco. Currently, no strategy has been developed to embark on such an ambitious agenda. The development of a Digital Transformation Strategy for the Ministry with a clear actionable road map for the next five years with the explicit intent of harnessing technology to better assist its customer base is a prerequisite for the success of the reform agenda. Furthermore, like in any organization, the success of this strategy will involve a change in approach and movement towards a more adaptive, agile organization that responds quickly to changes in the environment and future challenges.
55. The Ministry of Agriculture would become the one-stop digital shop for farmers aiming to improve customer service for producers and farmers across Morocco with a farmer-first attitude. The Digital Transformation strategy will: (i) offer seamless, secure and transparent digital services across different sector stakeholders, (ii) improve customer/ farmer experience, enhance civic engagement and digital inclusion, (iii) increase resiliency and reduced time to recover from natural disaster events, (iv) ensure seamless and efficient trade, commerce, investment, (v) develop digital literacy skills at all levels in the workforce, (f) provide the framework to accelerate investment in digital infrastructure, services & talent and (vi) foster a knowledge-based innovation ecosystem. This activity will result in an Architecture Enterprise Blueprint for the Ministry that focuses on inter-operability with existing central level systems and focuses in optimizing and making more efficient not only the internal Ministry processes but also optimizing the provision of services to different stakeholders through digital means. Among key areas to address are: (i) digitize public records and simplify government procedures, (ii) leverage mobile and digital channels to improve access and engagement with customer base while lowering costs, (iii) leverage Cloud and SaaS to deliver efficient public services and smoothen disaster recovery, and (iv) create a digital platform to deploy open data and build private-public partnerships.
56. As the Ministry of Agriculture progresses in its digital strategy it will ensure consideration to developing a single, integrated platform for government services (build once, reuse always), based on digitized registries (in this case
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particularly as related to farmers) to improve customer service. As the use of data and information will continue to increase in the future, as the internet of things, sensors, imaging, etc., become more and more used in agriculture, considerations will need to be given to issues of privacy and cyber-security. Furthermore, the Ministry will need to adopt improved procurement methods (outcome-based) and develop new supply models, including increase of service contracts and private-public partnerships. As new e-services are developed, the following would be key considerations and at the center of the transformation process. The new services will be open and secure by design, digital from start to end (not a document driven approach), user-centered service design (the client of service is the focus not the process), and mobile centric and adaptable to accommodate new devices and future developments. Furthermore, the acceleration of climate-intelligent and digital technological diffusion in the agricultural sector presupposes prerequisites in terms of digital transformation and integrated system allowing not only access and consumption of information in real time but also, automated processes between systems and organizations to provide complementary data collection promptly and to feed knowledge bases interactively.
57. Currently, the Ministry of Agriculture and affiliated organizations (including INRA, IAV, ONCA, etc.) have not been successful in scaling the use of digital systems and technologies or decision-making tools. The Ministry through DSS has deployed limited tools to improve and collect information. Unfortunately, these solutions are being deployed under a siloed approach, with little consideration towards the integration, and interoperability of data and tools. Within the Ministry they are several IT solutions, that use data for decision making with very limited impact. There is no coherent platform or standards to upload, store, validate, refine, cleanse and analyze data. The Ministry does not have an integrated approach to the use of data, or even a consolidated repository that can be used by different stakeholders in the Ministry or even outside. Result Area 3 supports the development and improvement of digital systems and uptake in the use of information for decision making in agriculture. This can help the Government target resources better, and farmers themselves make better decisions. A collaboration between both is key. Furthermore, to assure a successful scaling of digital systems and technologies, the Ministry will require a high-level lead who carries out the role of Chief Digital Officer/Chief Data Officer. This officer will have decision making power to move the transformation forward and make sure solutions are solving problems and the appropriate collaboration within sector organization is assured.
58. The proposed activities under the Program require the improved use of data for agriculture purposes, and furthermore would encourage the development of an open data platform that is not only open to government organizations, but also to research and development organizations, academics, and the private sector. It is well known (including evidence in Morocco) that data collection and curation can be up to 80 percent of the costs of development for new digital technologies. Furthermore, recent evidence suggests that the use of big data and digital technologies can help farmers better adapt to threats -- both present and future -- from a changing climate36. Activities under RA3 encourage the use of Big Data, including satellite imagery and geographically reference data to improve the understanding of agriculture, and by using advanced artificial intelligence and machine learning models, provide data analytics that can provide more real-time insights that help the sector adapt to changing environments, thus improving productivity and adaptability of farmers to increasing climate risks. The adoption of digital tools can also provide the analytical foundations of an improved digital extension and advisory service. A key element of success will be the close collaboration with the digital agriculture innovation eco-system and local entrepreneurs as to adapt existing technologies to the local circumstances. Where possible, existing technologies (at national or international level), would
36 “Using an enormous amount of data obtained from satellites, research aircraft, drones and remote sensors, and from farmers via advanced geospatial sensor suites present in many modern combine harvesters researchers and beginning to help farmers see their fields in a new manner, helping them make better decisions to improve yield, reduce cost and improve environmental impact. The study, published in Scientific Reports, is the first to precisely quantify soil and landscape features and spatial and temporal yield variations in response to climate variability. It is also the first to use big data to identify areas within individual fields where yield is unstable.” Rafael A. Martinez-Feria, Bruno Basso. Unstable crop yields reveal opportunities for site-specific adaptations to climate variability. Scientific Reports, 2020.
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be considered versus the development of proprietary technologies, since such endeavor is costly and usually out of the scope of expertise of the different agencies.
59. Open Data initiatives and the combination of different datasets and the multiplication data usage by different stakeholders has led to compelling socio-economic and environmental impacts in almost all domains in urban as well as rural areas. For example, the EU INSPIRE project, which consists in sharing geospatial data for sustainable development objectives has achieved a return on investment of 8: 1 in four years within the government. It would be necessary to ensure the collection and the sharing of raw data sets in several formats (different file format, API, rich in metadata, readable by information processing, etc.) to allow different stakeholders to improve their predictive analysis work upstream and downstream of the value chain. It should be noted that Open Data also incorporates different forms of non-digital information (awareness campaign, information message on a communal board, radio announcement, etc.).
60. Digitalization of extension advisory services. ONCA was created in 2013 as part of the institutional restructuring associated with the PMV to concentrate mission, competencies and skills for agriculture advisory and training into a single institution. Since then, more than 2.3 million beneficiaries have taken part in information and awareness campaigns and individual coaching visits. Study tours and training days benefitted some 66,000 and 76,000 farmers and professionals respectively. In parallel, ONCA carried out 773 school fields which benefited 12,000 farmer focus groups representing about 48,000 farmers. Awareness and training campaigns were implemented through about a thousand shows on 3 TV channels and 700 weekly radio programs. In recent years, ONCA staff was reduced due to non-replacement of retired staff37, and both operational budget allocation for transport and field visits and for training of extension agents decreased following budget constraints. This has contributed to hampering the Office’s capacity to comply with its mission.
61. Digital technologies can improve the functioning of agriculture extension systems at a very low cost per farmer38. Establishing initial mobile phone coverage involves fixed costs, but the marginal cost of phone communication in rural areas is very low because cell phone towers typically operate below capacity. Mobile Network Operators (MNOs) charge prices well above marginal cost, but they are often highly regulated, and governments could negotiate access at prices with lower markups. Mobile phones, particularly GPS-enabled smartphones, facilitate the provision of tailored information. Recommendations for agrochemical inputs that address specific soil conditions on the basis of digital maps can improve yields while reducing environmentally harmful and wasteful use. Messages can target specific areas with reported pest outbreaks or be customized to other local conditions such as market prices. Farmers can tailor their investment decisions to expected weather patterns and benefit from improvements in weather forecasting. Customized information allows farmers to choose language, dialect or literacy levels. Mobile technologies can also provide reminders and other nudges to address behavioral biases. Images taken from satellites can provide information about crop growth and, when linked with Geographic Information System (GIS) on plot boundaries, can improve measurements of productivity at scale. Mobile phones facilitate two-way communication, whereby farmers can ask questions and request information. Such platforms can also provide opportunities for networking and information exchange among farmers which in turn can further improve future recommendations for all users. As smartphone use continues to expand, farmers will increasingly have the means to watch videos demonstrating new agricultural techniques or take pictures of pests affecting their crops and either request automatic identification and recommendations or raise questions with agronomists. Mobile phones may create opportunities to complement and strengthen existing in-person traditional agricultural extension systems. Many agricultural extension workers already
37 As a consequence, the ratio of farmers to extension workers exceeds 1000 to 1. 38 See Raissa Fabregas, Michael Kremer, Frank Schilbach: “Realizing the potential of digital development: the case of agricultural advice”; Research, December 2019.
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have smartphones and thus could download information on problems arising in their region, as well as information needed to respond to farmer queries.
62. Agriculture knowledge dissemination systems can accommodate digital technologies in many ways. There are large scale government-run farmer information systems39. MNOs can run their own information system for farmers40. Farmer information systems can specialize in crops or livestock41. Precision agriculture schemes can collect, process and produce highly customized technical information for farmers. In a scale of increasing precision, these schemes range from early warnings systems on weather and pests42, to satellite and drone-based solutions for precision agriculture43, soil and crop advisory services44 and fully integrated solutions combining soil data, farmer data, field sensors and remote sensing data from satellites and drones45. One last category includes participatory and peer-to-peer solutions46. Participatory advisory solutions feature tight feedback loops between content providers and end-users, greater levels of farmer interactivity with the solution (not just one-way information flows from experts to farmers), and, in many cases, a role (direct or indirect) for farmers in creating or customizing advisory content. Peer-to-peer advisory solutions share some of these features, but also put individual farmers and farmer experts into more central roles for content creation and dissemination. Some peer-to-peer advisory models link farmers with each other directly, so that one farmer’s questions are answered by another47. Broadly speaking, digital advisory solutions are moving toward greater interactivity, localization and adaptation of content.
63. Emerging digital technologies are a means to improve the efficiency of ONCA, in terms of (i) ratio of farmer served per extension agent; (ii) feedback on relevance and satisfaction by farmers; and (iii) contribution of farmers to the creation of agriculture knowledge through a feedback loop. However, injecting digital technologies in farmer extension system is a long and complicate process which requires strategic decisions to be taken on which of the above options of digitalization of agriculture extension are best suited. It also touches on capacity building of extension agents; acquisition, use and maintenance of digital equipment; data storage and governance; and establishment of partnership with external stakeholders such as research, universities, MNOs, banks and precision agriculture service providers. It is thus proposed to adopt a phased approach to digitizing ONCA’s advisory system while at the same time leveraging the capacity of private sector to deliver digital advisory to Moroccan farmers.
39 Such as 80-28 farmer hotline in Ethiopia, ZIAMIS in Zambia, and Karlo’s suite farmer application in Kenya 40 Such as Orange D4AG service portfolio and ECONET’s ecofarmer in Zambia. 41 Such as I-Cow (livestock) and I-Shamba (crops) in Kenya 42 Such as ECONET in Zimbabwe, Ignitia Iska in West Africa, Weather Impact for weather early warning and Boa Me in Ghana, Rise Africa in RSA, Nuru in Kenya for pests, 43 Satellite-based examples include Sat4famring in Ghana, Geodatics in Kenya, MUIIS in Uganda, CROPIN and Precision Agriculture for Developement (PAD) in India. Drone-based examples include: Astral aerial in Kenya, Agrinfo Jembe in Tanzania, Charis in Rwanda. 44 Yara International ImageIT, Agricares, Plantix, Croptix, Lentera in Kanya, Grainotheque Yiri Drotro in Cote d’ivoire, Sun Culture, IBM EZ farm and Microsoft farmbeats. 45 Examples are Microsoft’s Farmbeats (and related Digital Agriculture Platform) in Kenya and the Tata Consulting Services (TCS) InteGra precision agriculture advisory platform in South Africa. Precision agriculture start-ups like AgrInfo/Jembe in Tanzania, Zenvus and Kitovu in Nigeria, Lentera in Kenya, and CropIn, are moving in a similar direction. 46 Such as Digital Green in India, iShamba in Kenya, the 80-28 Hotline service in Ethiopia and Farm Radio’s Mlimi Hotline in Malawi. Also, the use of Interactive Voice Response (IVR) tools – either in combination with call centres and SMS channels or via stand-alone channels – is now mainstream for digital advisory solutions in Africa (see Ethiopia 80-28 Hotline and Viamo’s network of IVR-based 3-2-1). Newly arrived in the interactive advisory model space are chatbots for digital service delivery (see Arifu, a large digital learning and advisory service that works with African farmers via SMS and chatbot applications73 and the chatbot-based advisory platform in Kenya, Farm.ink). 47 This approach creates tremendous opportunities for on-the-ground data collection and for impacts on farmer behaviour (i.e., farmers engaging more with content that is validated and shared by their peers). But, like any social networking solution with limited control, it also presents significant risks that low-quality or inaccurate agricultural advice and information can be collected and distributed based on crowdsourced perspectives or direct farmer-to-farmer advice. Farm.ink chatbot, for instance, relies on a Facebook farmer community that generates farm queries and content that the chatbot can mine and pair with professionally controlled agronomic content.
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64. Agricultural knowledge can also be disseminated by private service providers for a range of digital services. These services include: (i) detection of the level of soil fertility using digital hand-held devices which provide instant reading of fertility and avoid laboratory analyzes of soil; (ii) detection of plant diseases on the basis of artificial intelligence (picture of an infestation factor is compared with similar cases from a big data of plant diseases to provide an initial diagnosis); (iii) the establishment of kits using IOT devices for irrigation or for livestock management; and (iv) E-platforms for sharing agricultural mechanization equipment (Uber-type). These digital services can be provided by individual entrepreneurs, service cooperatives, start-ups and specialized providers and as such, contribute to employment in rural areas, with a special focus on youth. The program’s role will be to facilitate the creation and dissemination of the above digital solutions by private actors through incubation and acceleration programs, innovation challenges connecting supply and demand of innovative solutions, improved access to funding and specific regulatory measures. This facilitation will be carried out mainly by ONCA with support from MAPMDREF, Agence de Développement du Digital (ADD), Ministry of Labor and Social Affairs and the ANAPEC.
65. Development of a new digital agricultural aggregation model. This activity will support the Agence de Développement Agricole (ADA) through technical assistance to design a new digital aggregation model. Aggregation brings together small farmers and buyers to achieve economies of scale. Individual farmers bring their produce to designated collection points – aggregation centers – where the crops are collectively marketed, awaiting their pickup by buyers. It is one of the most critical and time-based activities involved in agriculture programs. Farmers want to quickly sell part of their crops to meet some of their immediate needs and smooth their limited cash inflows. Buyers, on the other hand, want to be able to plan their logistics and pick high-quality produce at competitive prices during the peak harvesting period. Aggregation presents several cost-saving opportunities48, including: (i) logistical support – aggregation reduces logistical costs of sourcing output from smallholder farmers. It may also be a tool for improving quality, as producer organizations can add value to crops through sorting, drying, storing and other functions, depending on their capacity; (ii) marketing and distribution of services – aggregation can reduce marketing, distribution, loan-making and servicing costs for firms marketing inputs or financial services to smallholders; (iii) provision of training – training groups to increase productivity is generally more cost efficient than working with farmers on a one on one basis; and (iv) Information dissemination – aggregation reduces the cost of collecting and disseminating information for firms seeking certified crops, such as reducing auditing costs.
66. Digital technologies could enhance the aggregation process in terms of primary production, post-harvest, marketing and financing through: (i) digitization of administrative details (e.g., name, number, inputs purchased, amount of crop sold, acreages, etc.) on the farmer registry based on the transaction records of farmer organizations; (ii) promotion of efficiency and quality at production stage through precision agriculture; (iii) use of smart contracts, digital traceability, food sensing technologies and E-commerce platforms for food logistics and marketing; and (iv) use of FinTechs for improved access to rural financing. Morocco has a few ongoing initiatives on aggregation implemented through digital solutions. The most prominent ones include the initiative of farmer digital card by the Compagnie sucrière du Maroc (COSUMAR) and various digital solutions implemented by the Office Chérifien des Phosphates (OCP). ADA is proposing to conduct a study on these existing digital agriculture initiatives to extract lessons learned and elaborate a scalable model to improve aggregation in food value chains throughout the country. These scalable models would include various types of digital solutions as mentioned above and would be implemented by aggregators and value chain organizations (inter-professions).
67. Agricultural extension for drip irrigation schemes. Irrigated agriculture plays a key role in the Moroccan economy. Despite accounting for only 16 percent of cultivated area, it accounts for 75 percent of agricultural exports and 15 percent of total exports. Irrigation development has been enabled by a program of surface water storage through
48 https://www.growafrica.com/resources/how-do-takers-and-smallholder-farmers-use-aggregation-models-grow-their-business
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dams’ construction in major river basins, undertaken by the Moroccan government. Growing water scarcity, linked to an increasingly frequent pattern of droughts and overall declines in rainfall, has reduced surface water availability and led producers to supplement supplies through groundwater, leading in turn to depletion of aquifers. The Government of Morocco has developed a long-term program through 2030 (PNEEI) to address the challenge, including support for large-scale irrigation modernization to conserve water, including conversion of canal irrigation to localized sprinkler and drip schemes, with widespread metering. The program covers 555,000 ha of irrigated land, including 220,000 under large-scale irrigation schemes (GIs) where modernization takes place collectively, with financial support. Three schemes totaling 60,000 ha have been completed, and more are under way. The ORMVAs have provided initial technical assistance in drip irrigation management and new agricultural practices, but longer-term advice is necessary to ensure sustainability. A convention was signed between DIAEA and ONCA to address this issue. However, ONCA does not currently possess the skillsets to provide this advice. The proposed activity would aim to address this challenge.
68. In order to achieve such a digital transformation as proposed above, the Ministry will appropriately sequence the activities. The development of an Open Data platform will be among the first activities to be carried out. They provide a key foundational element of the strategy. Furthermore, there will be a need to match the demand and supply of digital solutions. This will require close collaboration with the private sector through partnerships, or innovation challenges to encourage international established players, and local entrepreneurs to partner to provide the solutions to successfully implement the proposed activities.
PROGRAM CLIMATE CO-BENEFITS
69. Morocco’s agriculture sector is highly vulnerable to climate variability. Morocco is susceptible to chronic drought49, and climate variability and change is likely to exacerbate water scarcity, reduce yields, and increase the volatility of agricultural production, with substantial variation between regions.50
70. IPCC projections for the future indicate a very high likelihood of a continued warming trend for Morocco, where the observed increase in temperature, at around about 0.5 degrees Centigrade per decade, greatly exceeds the global average of about 0.15 degrees since the 1970s. Under a business-as-usual scenario, additional temperature increases of as much as 3 to 7 degrees Centigrade are projected for Morocco by the end of the 21st Century, with the largest increases (4-7 degrees) occurring during the summer months (i.e., June, July and August). Under the same scenario, projected precipitation declines are on the order of 10-40 percent annually, including 10-30 percent in the wet season from October to April and 10-40 percent in the dry one from May through September. With rising temperatures and the projected reduction in the net hydrological cycle, Morocco will be increasingly challenged in terms of its future water availability. Both rainfed and irrigated crop lands are, in fact, already undergoing increasing pressure from a climatic viewpoint.
71. The Morocco Nationally Determined Contribution also highlights the vulnerability of Morocco’s agriculture, water and forestry sectors to climate change and identifies major adaptation programs. Morocco’s vision for climate change management underlines the importance of territorially based risk and vulnerability reduction programs. More specific programs include irrigation development and increased irrigation efficiency through conversion to drip irrigation, water conservation measures, hydraulic infrastructure development and development of weather-based risk insurance mechanisms for rain-fed cereals and legumes. Additional levers for resilient water management include groundwater replenishment and substitution of over-exploited groundwater sources with surface water, desalination,
49 For example, the 1994/95 drought caused agricultural GDP to fall by 45 percent and total GDP to fall by 8 percent. 50 World Bank - Morocco study on the impact of climate change on the agricultural sector 2009: René Gommes, FAO/NRC Tarik El Hairech, DMN Damien Rosillon, consultant Riad Balaghi, INRA Hideki Kanamaru, FAO/NRC
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new dam development, ecosystems and water resource conservation, and projects to transfer water from the north to the south of the country. The NDC also commits to unconditional GHG emissions reductions of 17 percent. The emissions reductions projections for agriculture include those from (i) conservation agriculture, (ii) tree-crop promotion, (iii) agro-forestry and rangeland programs supported by the PMV, as well as (iv) silvo-pastoral programs.
72. Long-term actions pursued by GoM to climate proof the agricultural sector include measures that focus primarily on increasing water supply for agricultural activities. In parallel to these investments aimed at mobilizing more water for irrigation, the GoM has also enacted measures to save water in irrigation. The policy of encouraging localized irrigation (National Program for Saving Water in Irrigation—PNEEI) with attendant control water use, was initiated together with the inception of the Plan Maroc Vert, in 2008, and is currently further strengthened under the Green Generation Strategy. It has acted as a logical complement to the policy of mobilizing and supplying irrigation water and building climate resilience along the whole agri-food value chain.
73. In addition to the cross-cutting actions undertaken by the GoM to climate-proof agriculture as part of its GGS program, all the interventions included in the proposed Program have been designed to include climate co-benefits, both on the adaptation and mitigation sides. Climate co-benefits by DLIs are presented in Table A3.2.
Table A3.2 – Climate Co-Benefits by DLIs
Disbursement-Linked Indicator
Climate Change Benefits
Overarching goal: The program builds on complementing DLIs and provides a holistic strategy for supporting the implementation of the Green Generation Strategy and strengthening climate resilience across all four dimensions of food security: availability, access, stability, and utilization of food. Food availability is compromised by projected yield declines due to temperature and precipitation patterns change. Climate change also compromises food access by affecting the purchasing power of consumers through price increases as a result of climate change. Climate change affects food utilization primarily by reducing food safety through a higher incidence of food-borne diseases and spread of novel pests and diseases. With regards to food stability, the risks to food and nutrition security are exacerbated by the expected increase in the frequency and intensity of climate-related events. Furthermore, according to the World Bank’s Groundswell report, climate change will scale up internal climate migration and the poorest people in rural areas will be forced to move due to slow-onset climate change impacts, including decreasing crop productivity, shortage of water and sea-level rise. Therefore, all below actions geared towards building improved agri-food systems will contribute to an increased climate resilience and food security.
Mitigation Adaptation
DLI 1: Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan
The investment into the rural entrepreneurship ecosystem, provision of CSA training, development of the centralized online knowledge database and portal on CSA practices, and improved access to finance will build young rural entrepreneurs' capacity to integrate CSA measures into their projects. Youth representatives are expected to have higher adoption rates of CSA given the conditionality of financing and prioritization of these practices.
- The practices disseminated, if adopted, will directly contribute to net GHG emission reduction: improved energy use efficiency
The capacity building activities will promote technologies that: (1) improve water management efficiency and/ or
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in traction; improved soil management and restoration of degraded soils; adoption of energy-efficient equipment in irrigation and renewable energy generation and use; improved storage to reduce waste-related emissions; reduction of non-CO2 GHG emissions from agricultural practices by reducing inorganic fertilizer use.
access to irrigation and more efficient irrigation technologies; (2) use crop mix more suited to climate variability (drought, heat, pest and disease resistant); (3) reduce water use in land preparation and loss in crop growth stages. Financing climate-informed “bankable” projects will reduce the number of youth out-migration and increase resilience by creating income opportunities and encouraging investments in sustainable land and water use. The reduced men outmigration would also decrease the stress and risk of female partners in charge of agricultural production in a climate-stressed environment.
DLI 2: Reform of the legal framework of the FDA to include incentives for young rural entrepreneurs
This reform will create enabling environment the implementation of DLI 3 and favor for financing youth and women, particularly those who would have been coached on CSA practices. By improving the operating rules and procedures will provide incentives for young people and women to start their investment, which will also reduce out-migration from rural areas and enhance the financial ability to undertake the necessary adaptation.
DLI 3: Young entrepreneurs who benefited from FDA incentives for rural investments
Youth representatives are expected to have higher adoption rates of CSA practices than existing farmers, given the conditionality of financing. The financing criteria will prioritize practices that: improve energy use efficiency in irrigation and traction, generate renewable energy and enhance carbon storage in soils, improve storage efficiency and reduce inorganic fertilizer use.
This area will enhance the financial ability to undertake the necessary adaptation actions and decrease the number of youth out-migration. The financing will prioritize, e.g., efficient irrigation technologies; crop mixes suited to climate change and climate variability (drought, heat, pest and disease resistant).
DLI 4: Revised legal and regulatory framework governing the new modernized wholesale markets established
- The new regulation will provide smallholders incentives to implement low-carbon-footprint farming in order to meet the demand of the eco-conscious consumers by allowing the participation in formal markets instead of informal channels. It will also reduce the carbon-footprint of agriculture though reduced post-harvest losses. Nearly 65 percent of domestic fruit and vegetable production are marketed through informal channels due to unfavorable regulations.
- This activity will empower smallholders, particularly women, who are especially vulnerable to climate change impacts due to limited business integration opportunities into the agri-food value chain. By reducing the dependency on intermediaries, the activity will improve food availability, stability and access.
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DLI 5: Modernized wholesale market program developed
The constructions of buildings and installed equipment will be resource and energy efficient through (i) climate-proof and energy efficient building materials; (ii) energy efficient lighting and appliances, (iii) renewable energy sources (photovoltaic); (iv) refrigerators that use cooling systems with lower GWP potential; (v) spurring better logistics and energy use through aggregations. It is envisioned that to ensure that the energy efficiency of the market, the contractor will conduct energy audit.
Better market infrastructure (wholesale markets,) will improve the overall resilience of agricultural value chains by supporting improved business continuity during and after extreme weather events. The strategic environmental study will provide information how the proposed structure will take into the consideration exposure to climate change and the anticipated impacts of climate change (e.g. sea level rise).
DLI 6: Food export performance improved: percentage of export inspection certificates issued in digital form
This DLI will increase awareness and contribute to the monitoring of changes in foodborne disease outbreaks and the spread of novel pests and diseases which risk is exacerbated as a results climate change.
DLI 7: Number of agri-food enterprises/organizations authorized by ONSSA for improved market access and improved food safety
- Improved facilities for checking the residue of fertilizers will prevent the overuse of synthetic fertilizers and decrease GHG emissions.
The digital authorization process will improve food safety by reducing foodborne disease frequency through reduced time in transitional storage with inappropriate humidity and temperature settings and reduce the spread of novel pests and diseases exacerbated by climate change through improved traceability and early warning. Improved market access will also contribute to establishing alternative trade routes in case of disruption to the
main route. DLI 8: Digital ecosystem for climate-smart agriculture established
- This area will contribute to the reduced GHG emissions through resource efficiency: reduced energy use in water pumping) and other agricultural processes through remote management systems; (ii) improved fertilizers use through precision agriculture (reduces non-CO2 GHG emissions) and which use; (iii) improved land restoration monitoring through satellite imaginary.
- This area will contribute to adaptation through the (i) employment of precision agriculture51 and high-efficiency irrigation, (e.g., drip irrigation) systems; (ii) GIS and satellite image processing to improve land use monitoring; (iv) phytosanitary risk prediction, seismic detection and machine learning to improve early warning systems; (vi) improvement in the public support efficiency through farmers registry.
DLI 9: Adoption of climate-smart agriculture
E-advisory systems will improve access to climate change mitigation knowledge and
Small-scale farmers are often the most vulnerable to climate change and will
51 Goldman Sachs estimates that yields can rise by 15–20 percent due to more targeted fertilizer application, 13 percent due to better planting, 4 percent due to more precise spraying, and 10 percent due to precision irrigation.
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practices for the efficient use of water
technologies, thus ensuring that GGS
builds on the success of PMV52. Digitalized
services will provide information on practices that improve carbon pools and reduce GHG emissions: reduced tillage techniques, rehabilitation of degraded lands, improved fertilizers application, energy efficient equipment in irrigation and traction, and renewable energy generation and use; improved storage and reduced food losses.
particularly benefit from improved advisory systems. E-advisory services will specifically be targeted at irrigation schemes converted to drip irrigation to ensure full leverage of adaptation benefits linked to more efficient water use. E-extension services will also provide advice on agroecology, soils management, sustainable use of water
resources,53 and strategies for enhanced
preparedness to climate-related disasters.
PROGRAM GENDER DIMENSION
74. Gender in agriculture. In 2019, a gender study was conducted to analyze women’s constraints and opportunities along three agri-food value chains in Morocco, particularly the olive, citrus, and herb and medicinal plant value chains. The report finds major gender gaps, such as: (i) disparities regarding the occupation of positions involving decision making, with women generally involved in non-decision making positions; (ii) differences in wages and working conditions, with women generally conducting seasonal work linked to precarious working conditions and limited access to social security (due to the temporary nature of employment); (iii) disparities in access to information and advisory services, with women having limited access to extension services not adapted to their needs; (v) differences in the access to production factors (land, water, processing equipment) resulting in lower productivity and access to financial services; (vi) disparities in the level of producer organization and hence, limited access to national or international markets; (iv) exclusion of women from tasks involving technical knowhow or physical strength due to discrimination and stereotypes about women not being able to conduct technical or heavy labor, among others.
75. Recommendations. The study gave the following recommendations: (i) improve women’s access to information and advisory services, including training on quality promotion, marketing and marketing techniques; (ii) support the organization of women cooperatives and by this improve women’s access to essential production factors, finance and markets; (iii) increase wages, improve working conditions and social protection of seasonal workers; (iv) optimize administrative procedures, for example by setting up a one-stop shop for farmer support, among others.
76. Result Areas. The Program aims at reducing Morocco’s gender gaps in the agri-food sector by leveraging digital technologies to spur a more equitable and inclusive development of the sector. The constraints and recommendations outlined above will directly feed into the implementation of the Program. Result Area 1: The workshops and national calls for ideas to be initiated under Result Area 1, will directly build on the constraints and recommendations already identified. They will allow young entrepreneurs to develop digital solutions tackling women’s constraints along agri-food value chains. The entrepreneurs will then be supported through the Program in implementing their innovations. Result Area 3: The envisioned digitization of agricultural advisory services under Result Area 3 will allow to adopt these services to women’s needs and therefore directly address the apparent gap in access to information and extension services. In
52 Fabregas et al., (2019) based on meta-analyses demonstrates that the transmission of agricultural information through mobile technologies can increase yields by 4 percent and adoption of recommended agrochemical inputs by 22 percent. 53 Surface water stored in reservoirs is the main water source in many areas in Morocco. As droughts become longer and more frequent, this system is coming under increasing pressure; less surface water is available to producers, who compensate with groundwater, contributing to aquifer depletion.
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additional, digital technologies will facilitate data collection on gender differences and evaluation of related interventions, which will allow for the development of better-informed interventions in the long run. To ensure the safety of women to be employed by the companies supported by the program, and to protect them from sexual harassment, as well as women and girls exposed to civil works, the PMU Social Focal Points will support the development of codes of conduct for workers in the companies involved.
Result Area 1
77. Gender gap. While the proportion of women entrepreneurs remains below that of men worldwide, it is particularly low in Morocco (World Economic Forum, 2010). It is currently estimated that only 10 percent of entrepreneurs in the formal sector are women (Amina & Habiba Bensassi, 2018). Yet, this percentage masks women entrepreneurship in the informal sector. Women face various constraints in comparison with their male counterparts in developing a business in Morocco, these include: (i) lack of information and insufficient support programs for women entrepreneurs; (ii) limited access to networking opportunities; (iii) difficulties in accessing finance; (iv) cultural perceptions and obsolete societal representations, among others.
78. Activities. The Program aims at supporting women in taking on entrepreneurial leadership roles and closing the gender gap they face in establishing their businesses by tackling the aforementioned constraints. The Program aims at putting a specific emphasis on the equitable inclusion of women in the following activities already suggested under Result Area 1:
• Organization of communication and promotion campaigns. These campaigns will include strategies to ensure an equitable participation of women entrepreneurs and rural women in the Program;
• Organization of orientation and ideation sessions and support for women entrepreneurs. 25 percent of orientation and ideation sessions will be dedicated to women only. In addition, the Program will put specific emphasis on supporting women entrepreneurs by: (i) providing them with counseling and mentorship programs delivered at convenient timings and locations to maximize their participation; and (ii) creating a platform and associations for women to facilitate networking amongst women entrepreneurs.
• Pilot national call for projects. The selection and support of digital and climate smart agricultural projects will put a strong emphasis on choosing highly qualified women.
• Facilitate access to finance. The Program will put specific emphasis on supporting women entrepreneurs by (i) providing training to women on preparing bankable business plans; and (ii) ensuring equitable access to finance by women during the screening of business proposals for financing.
79. Results. The results will be reflected in the following PDO and intermediate results indicators:
• Intermediate results indicator - Young people informed, identified and guided by the entrepreneurship support system on the service offer on agricultural entrepreneurship through communication campaigns and ideation sessions (Number) – 22,500 of them will be women (overall target 90,000).
• Intermediate results indicator - Number of business plans prepared by young entrepreneurs in rural areas eligible for a commercial loan (Number) – 2,500 of them will be women (overall target 10,000).
• Intermediate results indicator - Young entrepreneurs who benefited from incentives for rural investments (Number) – 4,000 of them will be women (overall target 16,000)
• Intermediate results indicator - Young people trained and innovative projects awarded & supported (national competition) (Number) – 10 of them will be women (overall target 40).
• PDO 1 - Number of young people who have created agriculture-related enterprises that have been operational for at least six months (Number) (% of whom are women) (Number) (target of 20,000). The
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Program aims for 5,000 women having created agriculture-related enterprises. This number includes newly established women entrepreneurs only. This represents a ratio of 25 percent of women entrepreneurs supported, which is above the current national women entrepreneurship level of 10 percent.
Result Area 3
80. Gender gap. As shown by the Gender study conducted in 2018 by the World Bank in Morocco, women have relatively lower access to extension and advisory services than men. Specifically, the frequency, scheduling, language, choice of themes and duration of the training courses not adapted to the necessity of staying on the farm were found as not favoring the participation of women. Consequently, the study shows that women cooperative members were less trained than other cooperative members. While from the male cooperatives surveyed 100 percent have received training for at least one of their members, women cooperatives indicated that only 83 percent of them received training. Almost 90 percent of the men surveyed said that they had received technical training in the past five years compared to 80 percent of women.
81. Activities. As the Program will provide ONCA with the capacity to generate digital advisory support services to farmers, this offers a unique opportunity to close the gender gap with respect to women’s access to advisory and extension services. As part of the Program, advisory and extension services will be better tailored to women’s needs by training additional female extension agents and developing digital tools that will allow women to better benefit from ONCA’s services. This will allow for the delivery of advisory services that will not require women to leave their farms for long, take into consideration women’s specific needs such as language and knowledge requirements. Furthermore, under the challenge initiated under RA1, the lack of women’s access to advisory services will be posed as a problem for which young entrepreneurs can look for potential solutions to improve women’s access to advisory services.
82. Intermediate results indicator. Women cooperatives who have received training through digital technologies developed under the Program - 100 women will be trained. This indicator will solely count women cooperatives who haven’t received training until Program start to reduce the existing gender gap in access to training between men and women cooperatives.
PROGRAM PRIVATE SECTOR ROLE
83. MFD approach, collaboration with IFC and Private Sector Involvement. The Program will support GoM in addressing the binding constraints to enabling private sector solutions in the agriculture and food sector especially in youth inclusion, digital technologies and climate smart agriculture. The involvement of the private sector in the Program will be key to the sustainability of the outcomes. In this context, close collaboration with IFC will be sought under the Program to improve the business environment and promote public-private dialogue. Through collaboration with the newly launched IFC-led Global Platform for Rural Connectivity, the Program will be strengthened by deploying the appropriate partners to improve broadband connectivity in rural Morocco. The Program will also leverage the programs from the Disruptive Technologies and Venture Capital teams in IFC to address key constraints—e.g. providing the appropriate skills required by digital rural entrepreneurs to successfully raise private financing. In particular, the IFC platforms and networks can be leveraged to support improvement in the business skills (including on digital skills and disruptive technologies) of rural youth, incubation and accelerations of ideas by rural youth (I.e. through partnerships with companies in the IFC network), support to entrepreneurs and promising disruptive/digital technologies (i.e. seed funding, venture capital, etc.). In addition, the Program will seek collaboration with IFC in the agribusiness area. Possible entry points include PPP opportunities around wholesale markets, promotion of entrepreneurship, and professionalization of farmer organizations.
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PROGRAM ECONOMIC EVALUATION
84. Rationale for public intervention. The Program aims at accelerating the structural transformation of the agri-food sector by addressing several market failures affecting its performance, including through the use of digital technologies facilitating access to advice, finance, etc. These market failures occur due to: (i) lack of support services and access to finance for young entrepreneurs; (ii) limited access to markets for small-scale producers linked to inadequate traceability, inefficient inspections and certification processes for food safety among others; (iii) limited access to knowledge and skills on the adoption of improved agricultural or sustainable practices.
85. Economic impact of the Program. The Program aims at: (i) increasing income generation for rural youth; (ii) developing competitive, efficient, and sustainable agri-food value chains; and (iii) strengthening innovation, advisory service, research and training using digital technologies. This will result in improved incomes for the youth in rural areas, improved marketing on local markets and increased exports of agri-food products, improved efficiency and effectiveness of agricultural services, and improved sustainability of agri-food value chains.
86. World Bank and AFD value added. Bank and AFD support will improve the efficiency and targeting of the activities supported under the Program, thereby increasing both its economic, social and environmental benefits. The World Bank has global expertise in the design and implementation of innovative projects and programs in the agri-food sector. In addition, the World Bank has been deeply involved with the GoM since the inception of the PMV and during the preparation of the GGS, notably through the DPF series and an earlier PforR supporting the PMV. The Bank is thus in a unique position to support the GoM in designing and implementing the Program in order to maximize economic, social and environmental benefits.
Economic evaluation of the Program
87. The economic evaluation aimed at analyzing the investments under the Program, supported by (i) a financial analysis of the main physical investments (i.e. the wholesale markets), and (ii) an international benchmarking—done by analyzing similar activities (i.e. technical and financial support of newly established enterprises, and establishment of business incubators) in past projects/programs in countries depicting similarities with Morocco with respect to their agri-food sectors.
88. Result Area 1 - Increasing job opportunities and income generation for rural youth. The Program has the potential to generate substantial positive economic benefits over the long term for the youth. At the macroeconomic level, the creation and growth of innovative businesses would contribute to increased productivity, efficiency, and competitiveness in the economy. These combined factors will contribute to creating jobs and economic opportunities for Morocco. The Program would also contribute to generating increased government revenues through additional tax receipts and to reducing the fiscal burden associated with public SME finance schemes as private sector investment in startups and SMEs grows.
89. The Program may also have a strong impact on improving productivity and sustainability of young businesses. At the micro level, through the provision of a wide array of business development support, the Program would contribute to building the skills and know-how of young graduates, entrepreneurs, and startups, enabling them to better take advantage of business opportunities as well as improving the productivity and profitability of their own or others’ businesses. Similarly, through a focus on innovation and technology adoption, the Program would enhance the competitiveness of Moroccan startups and SMEs, contributing to their growth and sustainability. As RA1 is focused on rural regions and the youth, it would contribute to addressing the spatial disparities that exist in Morocco.
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90. Over the medium term, indirect and direct co-investments undertaken through the Program are expected to generate a return to the Government. Given the focus on more risky investments in seed and early stage innovative startups, the net return to the Government is expected to be low. The overall social returns, however, are expected to be high, as investments in the very early funding stages would contribute to strengthening the pipeline of startups, thereby improving the quality of investments at the later funding stages. Considering the design of the Program and plausible assumptions on investment returns, the financial projections and analysis indicate that the Program will generate proceeds that will be sufficient to cover the costs of managing the Program.
91. While no IRRs or NPVs can yet be calculated for the businesses to be supported, other projects give clear indications on the profitability of supporting newly founded enterprises. A recently completed ADB project that supported producer associations’ business plan preparation and implementation including financial support found that a Financial Internal Rate of Return of 30 percent was reached (ADB, 2017)54.
92. In addition, the establishment of business incubators is foreseen under RA1. To assess their profitability information from other successful projects will be used. Business Development Services (BDS) projects and other technical assistance projects to SMEs supported by the World Bank have had successful development outcomes in 84 percent of IEG evaluations from 2006 to 2012. In addition, Agrifood Consulting International and Economic Transformation Group (2011)55 conducted a case studies of incubators located in Africa, Asia, and Latin America. While the incubators assessed operate at different scales, impact assessments indicate that the majority were successful in creating sustainable and competitive enterprises where benefits outweighed the cost and new technologies as well as product and process innovations were scaled up. A full cost benefit analysis of an agribusiness incubator investment was available for the case study Fundación Chile. The study shows that US$1.303 billion benefits of the seven selected programs are 23 percent higher than the US$1.05 billion in total costs of Fundación Chile over the 30-year period.
93. Result Area 2 - Improved efficiency of agri-food marketing systems. Investments in the wholesale markets is expected to lead to a reduction of inefficiencies along the value-chain, which will result in economic gains both for consumers and producers. The new business model of the wholesale market removes the tax on the value of products which has several major drawbacks: (i) it is difficult to assess objectively due to limited data: a weight multiplied by an average price is sometimes elusive in the case of non-homogeneous cargo; (ii) it penalizes high value products which thus tend not to go in those markets where the storage conditions (absence of cold conditions) are not adequate; and it does not provide the managing entity with a regular income throughout the year.
94. The new economic model for the wholesale markets is based on well manageable and controllable components, namely the area occupied by the operators and an entry price that applies to all, depending on the size of the vehicle used. This system is fair as: (i) it allows operators to set charges themselves consistent with their means, modulating the space occupied; (ii) it offers a uniform price for each type of operators in each area; and (iii) it changes according to objective criteria.
95. The business model adopted will rest on a few simple principles: (i) all charges will be levied on the basis of the area actually occupied by each type of operator; (ii) the charge amount will be calculated not to exceed 5 percent of the theoretical value of the products; and (iii) the municipality will no longer receive taxes on the value of products, as it will be remunerated on the basis of dividends from the entity in charge of managing the wholesale market.
96. A preliminary Cost Benefit Analysis (CBA) for the four wholesale markets was conducted which draws on information provided by the MAPMDREF and a feasibility study prepared for the wholesale market in Rabat to be
54 African Development Bank, 2017. Egypt-Rural Income and Economic Enhancement Project - Project Completion Report. AHHD Department. 55 Agrifood Consulting International and Economic Transformation Group (2011). Growing Food, Products, and Businesses. Applying Business Incubation to Agribusiness SMEs. Download: https://www.infodev.org/infodev-files/resource/InfodevDocuments_1139.pdf
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realized under the Strengthening Agri-Food Value Chains Program (P158346). The following information was available: (i) initial estimates on investment costs for the four wholesale markets in Berkane, Meknes, Marrakesh, and Agadir; and (ii) initial estimates on operating costs and benefits for the wholesale market in Rabat. The financial analysis of the wholesale market envisioned to be built close to Rabat found a sound Financial Internal rate of Return (IRR) of 9.83 percent over a 20-year period. All estimates provided for the wholesale market in Rabat were scaled by volume relative to the volume to be turned around in each of the four wholesale markets. While these represent first estimates, they are the sole information available at the time of Program appraisal. Using the CBA method and the data stipulated, the FIRRs estimated range from 16-17 percent for a 20-year investment period. This analysis therefore indicates that the overall investment in the four wholesale markets is likely to be characterized by high profitability.
97. Result Area 3 – Enhanced digitalization of agriculture and adoption of climate smart agriculture practices. Under RA3, the Program envisions the digitalization of agricultural advisory services, the introduction of an open data repository for innovation and data-driven decision making (incl. establishment of a GIS and satellite image processing system), and the introduction of digital decision-making tools for agricultural monitoring and advice, among others. These tools directly aim at improving the efficiency within public sector institutions and the efficiency of public sector institutions in their daily work with clients and therefore reduce related costs, and spur innovation by the private sector.
98. While a direct assessment of digital extension services is currently not feasible, current research shows that digital technologies facilitate knowledge transfer and skill acquisition, and have a positive impact on technology adoption, yields, and profits. A meta-analysis in India and Kenya found that digitally delivered extension increased farmers’ yields by 4 percent and the likelihood of adopting recommended agrochemical inputs by an odds ratio of 1.22 (Fabrega, Kremer, & Schilbach, 2019). In Ethiopia, SMS-based advisory services increased wheat production from 1 ton per hectare to 3 tons (ATA, 2019). Avaaj Otalo, a mobile phone-based extension service for Indian cotton farmers increased the adoption of more effective pesticides and the planting of lucrative but risky crops (Cole & Fernando, 2012). Simple farm cycle-based SMS advice helped Kenyan farmers to raise yields by around 10 percent—especially for farmers with limited prior agronomic training (Casaburi et al. 2014).
99. While a direct assessment of the potential benefits of a GIS and satellite image processing system is currently not feasible, model predictions can give essential indications. A recent study by the US Geological Survey (USGS) shows the economic benefits that remote-sensing information can provide to society. USGS used moderate-resolution land-imagery data from the Landsat and Advanced Wide Field Sensor satellites and modeled the relation between cropland uses and dynamic nitrate (NO3-) contamination of aquifers in a case study region in northeastern Iowa. The results show that by moving corn production to lands identified to be less prone to leach nitrate and additionally to lands with transport properties that render aquifers less vulnerable to leached nitrate, the value of the crop can be increased substantially, while holding the risk of groundwater contamination constant. For the northeastern Iowa study region, the study finds a marginal benefit of $858 million (± $197 million) annualized, which corresponds to a net present value of $38.1 billion (± $8.8 billion) for that flow of benefits in perpetuity. Hence, the use of these datasets can allow for better management of land use and groundwater quality.
100. While in a nonrelated sector, the experience of Denmark seems to point into the direction of benefits to be accrued from open data policies. In 2005, Denmark started to release its address data to the public free of charge. Prior to that date, each municipality charged a separate fee for access, rendering the data practically inaccessible. There were also significant discrepancies between the content held across different databases. A follow-up study commissioned by the Danish government estimated the direct financial benefits alone for the period 2005-2009 at EUR 62 million, at a cost of only EUR 2 million.
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C. PROGRAM RESULTS FRAMEWORK AND MONITORING AND EVALUATION (M&E)
101. MAPMDREF, through DSS, will coordinate the M&E activities of the Program. It will compile and consolidate data and supporting documents, ensure data quality, and prepare and submit the reports to the Bank on a timely basis. DSS, along with DDFP, DIAEA, DF, ADA, ONSSA, ONCA, as well as the Wilayas and DIAEA/ORMVA will collect data about physical progress, achievement of results in each Program area, and the flow of financial funds. DRAs, the inter-professions, and the CIAs will support data collection efforts. MAPMDREF’s DSS will report to the Bank on a semi-annual basis, covering the following items: (i) expenditures, including transmission of audited accounts; (ii) physical progress; (iii) results framework indicators; (iv) disbursement linked indicators (DLIs); (v) compliance with social and environmental requirements; and (vi) grievances and any allegations on fraud and corruption. Reports will be endorsed by the Steering Committee and submitted for decision during the semi-annual meetings. A Mid-Term Review will assess progress of Program implementation towards the development objective, and, at the end of Program implementation, an independent evaluation will assess the Program’s results and impacts.
102. The Program’s M&E system will draw on the existing Government’s systems used to track implementation of the GGS program. MAPDREF’s DSS will be responsible to collect, consolidate and report achievement of results agreed as part of the Results Framework, particularly for DLIs. The Program will take advantage of existing tracking mechanisms and types of records put in place for the activities and investments under the GGS. Additional data will be collected by DSS inter alia in the following areas: (i) investments by youth with support of FDA through DF, using the FDA-based database that manages the information on applicants, proposals, and awarded incentives; (ii) implementation steps regarding the wholesale facilities as tracked by DDFP; (iii) agricultural production, collected by DRAs by means of surveys and administrative records based on an online-based platform (STATAGRI), administered at central level by the DSS; and (iv) on farmers supported in modernized irrigation perimeters through DIAEA, on producers in aggregation projects using the ADA information system (number of producers participating in the aggregation schemes, aggregated surface, etc.), and on specialists trained in data science. Although those systems have been extensively used, they have substantial weaknesses. Given the above, establishing an integrated and harmonized M&E system will be a time consuming and difficult undertaking. Indeed, some data may be still be manual and paper-based (spreadsheets) and limited in depth and scope, whereas others use more advanced methods and technologies. In fact, several databases have been found to be internally inconsistent, and the systems in place are often not geo-referenced and operate in isolation.
103. Addressing data collection weaknesses and building M&E capacity will be part of the Program’s activities. Through the Program, MAPMDREF will put in place a simple, integrated web-based data administration system (Management Information System, MIS) that will allow for better data management and periodic reporting, including specific requirements such as gender-disaggregated data. To ensure transparency and strengthen citizen engagement, MAPMDREF will conduct at least one public consultation per year on the Program throughout the implementation period. This will be monitored as an indicator in the Program’s results framework.
D. PROGRAM GOVERNANCE STRUCTURE AND INSTITUTIONAL ARRANGEMENTS
104. The Program’s institutional architecture relies on several affiliated entities and stakeholders with different roles and accountability lines. Given the nature of the Program, its implementation will be based on the combined intervention of key stakeholders comprising MAPMDREF as the lead entity, MAPMDREF departments and affiliated agencies, and external partner institutions linked to MAPMDREF through specific agreements. The main institutional risk for Program implementation relates to the quality and strength of the coordination among those entities. Figure 2 depicts the Program’s institutional architecture.
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Figure A3.2: Program Institutional Arrangements
123. Table 2 presents an overview of the responsibilities of different Ministries and institutions by activity under each Result Area.
Table 2: Responsibilities by Result Area
Task Responsibility
Result Area 1 – Increased Job Opportunities and Income Generation for Rural Youth
Sub-Result Area 1.1 – Strengthening the ecosystem for rural entrepreneurship development
Improving the attractiveness of the rural economy for young people (a) Identification of economic opportunities at provincial level
MAPMDREF DSS, in partnership with the DRAs and ONCA
(b) Communication and promotion around project opportunities (c) Development and integration of rural entrepreneurial training modules in
vocational training centers (d) Organization of orientation and ideation sessions for rural youth (e) Creation of a web-based portal to link rural entrepreneurs and service
providers in their areas (f) Launch of a pilot national call for innovative projects
Strengthening the capacity of support institutions for rural entrepreneurship development (a) Capacity building of a pool of highly qualified agricultural advisers
Verification Unit (IGA) Program Audit (IGF)
Program Management Unit (PMU)
MAPMDEFDepartments
(DSS, DF, DDFP)
Decentralized Structures
(DRAs/DPAs, Wilayas)
PMU1. Coordinates
management of Program with implementing bodies
2. Ensures Program M & E and social and
environmental aspects3. Supports verification of
DLIs/DLRs4. Serves as secretariat
for the Steering
Committee
Steering Committee1. Strategic oversight and
orientation2. Reviews overall
progress3. Ensures mobilization
of stakeholders
PforR Steering Committee (Chaired by MAPMDREF)
Other Ministries and
Agencies(ANAPEC, ADA)
Interprofessions and
autonomous entities (Foodex, FDA)
MAPMDEFAffiliated Agencies (ONCA,
ONSSA, ADA, INRA, IAV, ORMVA)
Extended PMU Focal Points
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(b) Modernization of existing incubators within Dar El Fellah network and establishment of new ones
MAPMDREF DSS, in partnership with the DRAs and ONCA (c) Pre-launch support for the Program beneficiary rural youth
(d) Revitalization and professionalization of agricultural cooperatives (e) Launch of a pilot initiative for the emergence and empowerment of
agricultural service cooperatives for youth
Sub-Result area 1.2 - Improving access to financial resources for young rural entrepreneurs
(a) Review of FDA’s incentive system and legal framework to specifically target young rural entrepreneurs
MAPMDREF DF
(b) Establishment of a financial incentive mechanism for young people to start their individual projects
(c) Establishment of an incentive mechanism to support structured agricultural entrepreneurship
(d) Financial aid for the rental of agricultural land for the benefit of young people
Result Area 2 - Improved efficiency of agri-food marketing systems
Sub-Result Area 2.1 - Strengthening agri-food marketing and distribution in the domestic market
(a) Promulgation of the regulatory framework for wholesale marketing platforms of agricultural products
MAPMREF DGCL and Ministry of Interior
(b) Development of four new wholesale marketing platforms for agricultural products
MAPMDREF DDFP, in partnership with the Wilayas and other territorial authorities
(c) Development of electronic commerce of local products ADA
Sub-Result Area 2.2: Strengthening the national food safety control system
(a) Digitalization of processes associated with the issuance of phytosanitary certificates ONSSA
(b) Upgrading of ONSSA laboratories for plant and animal control
Sub-Result Area 2.3 - Improving agri-food export performance
(a) Technical control process of exports, and related issuance and management of export agreements
Morocco Foodex (b) Monitoring export markets
Result Area 3: Enhanced digitalization of agriculture and adoption of climate smart practices
Sub-Result Area 3.1 - Developing the digital agriculture ecosystem
Study of options for MAPMDREF’s digital transformation and preparation of related digital blueprint
MAPMDREF
Developing the digital ecosystem for informed decision-making regarding climate-smart agriculture
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- Establishment of a National Data Center for agricultural advice with regional relays
ONCA - Equipment and capacity building of agricultural advisers on aspects linked to
the digitalization of agricultural advisory activities
- Upgrade of the "ARDNA" system - Establishment of a videoconferencing system and interactive terminals - Development of agricultural land use maps
INRA - Development of a digital platform for precision farming - Creation of a Big-Data Center - Project for estimating the area of crops - Seismic detection of red palm weevil larvae
ONSSA
- Geographic Information Systems (GIS) and satellite image processing - Machine learning solution for the detection of plant diseases based on
images - Use of drones for phytosanitary treatments - Establishment of a videoconferencing system and interactive terminals
Installation of remote reading and remote management systems DIAEA in partnership with ONCA and ORMVA
Study of definition of a digital transformation model / concept of an aggregation project ADA
Creation and launch of a training specialty in Data Science applied to agriculture IAV
Sub-Result Area 3.2: Support for eco-efficient and resilient agriculture
(a) Technical assistance to support farmers in modernized irrigation sectors DIAEA in partnership with ORMVA
(b) Pilot initiatives for the promotion of agroecology and organic farming FIMABIO
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ANNEX 4. SUMMARY FIDUCIARY SYSTEMS ASSESSMENT
Introduction
1. As part of the preparation of the Morocco Green Generation Program-for-Results (the Program), the World Bank carried out a Fiduciary Systems Assessment (FSA) of the Program in accordance with the World Bank Policy on Program for Results (PforR) Financing. The objective of the assessment was to examine whether Program systems provide reasonable assurance that the financing proceeds will be used for the intended purposes, with due attention to the principles of economy, efficiency, effectiveness, transparency, and accountability. Accordingly, the Program procurement arrangements were assessed to find out the extent to which the planning, bidding, evaluation, contract award and contract administration arrangements and practices provide a reasonable assurance that the Program procurement systems will enable the achievement of intended results.
2. Data collection and methodology. The FSA was carried out by an experienced team of World Bank staff that included Financial Management and Procurement Specialists. The assessment was conducted based on: (i) the knowledge of the financial management and procurement systems in Morocco, (ii) the recent national PEFA report completed in 2017, (iii) the fiduciary data made available by MAPMDREF and affiliated public entities, (iv) the analysis of quantitative and qualitative fiduciary data from the execution of the Strengthening Agri-Food Value Chain PforR (P158346); and (v) the audit reports issued by the oversight bodies: IGF and Court of Auditors. The data made available by involved entities in the Program comprised the percentage of contracts awarded within the service standards, the average number of bids, the percentage of contracts awarded on a competitive basis, the percentage of contracts awarded on a single source basis, budget execution reports, the lead time in the procurement process as well as in the production of the financial statements, and the percentage of complaints received on contracts awarded at the implementing entities level.
Section 1: Conclusions
3. Risk assessment. The fiduciary risk is rated Moderate. The fiduciary systems will require to be strengthened to ensure proper implementation. The key risks are related to potential delays in the procurement process for the execution of the civil works required for the construction of the four wholesale markets, which represent 20 percent of the expenditure framework (Result Area 2). These risks may result from a lack of coordination in the programming and budgeting of activities between the central government and the local authorities involved in the selection of sites and the construction of wholesale markets. The ongoing Strengthening Agri Food Value Chain PforR has faced similar issues with the construction of the Rabat’s wholesale market which affects the Program’s execution. Additional risks are related to the internal control systems which will be implemented to ensure a correct execution of the financing mechanisms for young entrepreneurs such as for the identification of the beneficiaries based on transparent criteria, proper management, and accountability of the funds. This activity to be implemented for the first time by the Ministry will include disbursement of specific incentives to young investors. Activities related to youth grants and loans for investment and self-employment represents 27 percent of the total expenditure framework (Result Area 1). Finally, the last key risk identified relates to the lack of standardization and coordination between the financial management processes of the different entities responsible for program implementation with regards to timely budgeting of activities in accordance with the program implementation plan. This would have an impact on the production of timely consolidated financial statements of the Program, necessary to ensure the traceability of the use of funds and to facilitate external audits conduction.
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4. Mitigation measures. The Program’s design includes a comprehensive set of measures to mitigate the identified risks. First, the risk of delays in the procurement process for the execution of the civil works related to wholesale markets will be mitigated by the definition of a procurement performance monitoring system. The measures will be relating to the launch of bidding and signing of contracts for the four wholesale markets by the end of first 30 months of Program. Their monitoring will be ensured through the submission of quarterly procurement performance monitoring report, to be carried out by the DDFP at MAPMDREF. Second, the risk related to the financing of youth projects will be mitigated by the development of a detailed Program Operations Manual (POM) by the MAPMDREF that will include criteria and modalities for the selection of the beneficiaries and fiduciary reporting arrangements. The POM will provide all the guidance to access to financing and subsidy measures, as well as a Grievance Redress Mechanism (GRM) to promote a consistent approach to handling complaints. The assessment of the degree of compliance of youth projects with the guidelines of the POM will be included as audit diligence in the terms of reference of the annual program audits to be carried out by the IGF. Third, the risk associated with the lack of standardization and coordination between the Financial Management processes of the different entities responsible for Program implementation will be mitigated by the adoption of a harmonized financial reporting framework to facilitate the consolidation of financial information and would be included in the POM.
5. Procurement exclusions. The Program does not envisage any activities which would involve the procurement of high-value contracts with estimated values exceeding the following monetary amounts, as may be amended from time to time, that require mandatory review by the Bank’s Operational Procurement Review Committee (OPRC): (1) works, estimated to cost US$115,000,000 equivalent or more per contract; (2) goods, estimated to cost US$75,000,000 equivalent or more per contract; (3) non-consulting services, estimated to cost US$75,000,000 equivalent or more per contract; or (4) consultants’ services, estimated to cost US$30,000,000 equivalent or more per contract.
Section 2: Scope
Scope. The Program will be financed over five years (2021–25) for a total of US$487 million equivalent, including an IBRD loan of US$250 million equivalent and an AFD loan of EUR100 million. The distribution of this funding is as follows:
Table A4.1: Program costs and source of financing (US$ million equivalent)
Source Amount % of Total
IBRD 250 51.3
Borrower 122 25.1
AFD 115 23.6
Total 487 100
6. The Program will be implemented by MAPMDREF and six autonomous agencies that it oversees (ONCA, INRA, ADA, Morocco Foodex, IAV, and ONSSA). MAPMDREF and ONSSA are already involved in the existing Strengthening Agri Food Value Chain PforR (P158346) which has its fiduciary performance rated as Satisfactory. The Program's fiduciary systems are acceptable, and they provide reasonable assurance on the use of the Program’s resources.
7. Program Expenditure Framework. The Program Expenditure Framework (PEF) is extracted at more than 86 percent from the MAPMDREF’s and the six public entities’ budgets and will be included within the General Budget of the State (Budget General de l’Etat) which alignment with Government priorities, classification, sustainability and predictability are assessed as more than adequate as per the 2017 PEFA.
8. The PEF is structured around three result areas: (i) Increased job opportunities and income generation for rural youth (29.1 percent), (ii) Improved efficiency of agri-food marketing systems (48.3 percent), and (iii) Enhanced digitalization of agriculture and adoption of climate smart practices (22.6 percent). The program expenditures under these three result areas can be grouped under four main procurement categories: (i) Civil Works (21 percent), (ii)
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Equipment and goods (30 percent), (iii) Consulting and non-consulting services (22 percent), and (iv) Funding or grant mechanism (27 percent).
Table A4.2: Expenditure Framework by procurement categories
Program Components Civil Works
Equipment and goods
Consulting and non-consulting services
funding or grant mechanism
Total (US$ equ, millions)
% of Total
Result Area 1: Increased job opportunities and income generation for rural youth
0 0 8.36 133.85 141.84 29.10%
Improvement of the attractiveness of the rural economy for young people
0 0 2.74 0 2.74 0.60%
Reinforcement of the support system for agricultural entrepreneurship (pre and post enterprise creation)
0 0 5.62 7.53 12.79 2.60%
Improvement of the institution, financial and legal support system for agricultural entrepreneurship (targeted incentives for young people)
0 0 0 126.32 126.32 25.90%
Result Area 2: Improved efficiency and sustainability of agri-food marketing systems
101.05 51.26 82.63 0 234.95 48.30%
Improvement of 4 wholesale markets 101.05 0 0 0 101.05 20.80%
Digitalization of promotion and control process for exports 0 0 68,42 0 68.42 14.10%
Reinforcement of sanitary control of food 0 51.26 0 0 51.26 10.50%
Development of e-commerce platforms for local products 0 0 14,21 0 14.21 2.90%
Result Area 3: Enhanced digitalization of agriculture and adoption of climate smart practices
0 93.02 16.99 0 110.03 22.60%
Development and improvement of digital systems and uptake in the use of information for decision making in agriculture
0 63.68 2,65 0 66.34 13.60%
Digitization of agricultural advisory services (Digi-Conseil) 0 23.57 13,26 0 36.84 7.60%
Improvement of Agriculture eco-efficiency and resilience 0 5.24 1,08 0 6.32 1.30%
Creation of a data science training program applied to agriculture 0 0,53 0 0 0.53 0.10%
Total 101.05 144.28 107.98 133.85 486.81 100%
% by type of expenditure 21% 30% 22% 27% 100%
9. Alignment with Government priorities. The activities covered by the expenditure framework meet the directions set by the Government, under the GGS, which is the government’s strategy to build on the success of the Plan Maroc Vert and create a new generation of agricultural workers and entrepreneurs particularly among young and rural populations, with innovative support measures. This strategic vision is based on two strategic orientations, namely: (i) priority to the human element and the support of a new generation of young entrepreneurs; and (ii) the sustainability of agricultural development through the consolidation of the performance of agricultural value chains, with a view to doubling exports and agricultural GDP by 2030, and the improvement of product distribution processes through the modernization of wholesale markets. The strategy also lays the groundwork for improving the quality and capacity for innovation in the sector.
10. Sustainability. The sustainability of MAPMDREF’s expenditure framework is ensured by the existence of several tools. First, the Medium-Term Expenditure Framework (MTEF) developed in the context of the Public Finance Act. The current MTEF covers the period from 2019-2021 and is annually updated through the Finance Act. Second, a new multi-year program approach, deployed since 2019 with support of the Ministry of Finance (MEFRA), complements the MTEF. Third, the annual performance plan endorsed by the Parliament which describes the key programs, the associated budget and performance indicators. Fourth the annual performance report which summarizes the results achieved and the budget executed for a given year. The Program is well included and articulated with the above-mentioned tools.
11. In addition, funding sustainability is guaranteed by the high visibility and ownership of the government program and the Program itself – with two key ministries, MAPMDREF and MEFRA, directly invested into it – but also through the
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measures taken under the Program aimed to support and finance improvements to MAPMDREF’s capacity for monitoring and evaluation (M&E), as well as enhancements to the existing public financial management system.
12. Furthermore, Morocco has robust oversight mechanisms, which are carried out during implementation by the General Treasury (TGR) and the Court of Accounts (CoA), in the form of audits, and the establishment of a national committee to hear complaints and coordinate procurement policy. All those measures will contribute to the sustainability of the funding.
13. Over the past five years, MAPMDREF’s investment budget has acquired a degree of stability, with overall annual expenses stable (in average US$768 million) which represents an average of 13 percent of total investment credits from the general state budget. In the 2020 Finance Act, MAPMDREF received US$1.4 billion as investment budget which shows a continuous increase in its share of the general State budget. For the other five public entities, ADA, ONSSA, and ONCA had their annual financial resources increased by an average of 3 percent during the period of 2017-2019, with a respective average investment budget of US$6.4 million, US$43 million, and US$16 million. Similarly, the overall budget of Morocco Foodex increased between 2018 and 2019 from US$11.07 million to US$15.57 million. This, following the increase in Morocco Foodex's share of the revenue from the Parafiscal Import Tax (TPI). However, INRA and IAV, during the same period, had their budgets decreased by respectively 16 percent and 26 percent in 2018; and then slightly increased in 2019. It shows some budgeting instability for the INRA and IAV during the period of 2017-2019. Due care will be made within the Program boundaries to identify mitigating measures to ensure timely and enough budgeting of these entities. 14. However, with the Covid-19 health crisis, both investment and operating budgets of all the entities involved in the Program have significantly decreased. In fact, for 2021, the MAPMDREF operating budget decreased by 30 percent and the investment budget by 22 percent. This reduction embodies a risk on the prioritization and sufficient budgeting of Program activities by the autonomous public entities involved in the Program. Additionally, the MAPMDREF has not yet approved the multiyear budgets of these public entities. In order to ensure adequate budgeting of Program activities, the World Bank will closely work with the Financial Directorate of the MAPMDREF to ensure that budget programming is timely approved for all the public entities/central directorates to carry out related Program activities.
Budget structure
15. The Program’s budget structure is clear in terms of sources of funding, budgetary vehicles and categories of expenditures. The Program budget is funded by MAPMDREF and the five entities resources, through the General Budget of the State. All expenses are programmed in line with the Classification of the Functions of Government (COFOG) and will be incurred between 2021 and 2025. Around 21 percent of the expenditures finance physical assets, 27 percent in funding and grants/loans mechanisms to youth entrepreneurs, and 52 percent in consulting services, goods, and equipment, including IT. One main item included in the physical assets is the construction of four wholesale markets. It represents the most substantial risk. Mitigation measures were built in the Program design based on the lessons learned from the Rabat wholesale market developed as part of the Strengthening Agri-Food Value Chains PforR (P158346). These mitigating measures would enable to achieve successfully the interlinked activities as follows : (i) Promulgation of the regulatory framework for wholesale agri-food marketing platforms under the oversight of the DGCL (in MAMPDREF) and the Ministry of Interior and the (ii) Development of four wholesale markets, including financing related engineering and financial feasibility studies, prior activities with the establishment of a new delegated management model for wholesale markets based on territorial partnerships with involved communes and regional authorities. The other risk is related to access to financing for young entrepreneurs which is a new activity to be managed by MAPMDREF. Activities related to grants for youth for investment and self-employment represents 27 percent of the total expenditure framework (Result Area 1). The development of a detailed POM by the Ministry that will include provisions on criteria
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and modalities for the selection of the beneficiaries and fiduciary reporting arrangements will be supported by the World Bank.
16. Predictability. Overall, as per the 2017 PEFA, the predictability of the Government of Morocco’s (GoM) expenditures is robust with the indicator on predictability rated as A56 with timely release of the budget’s appropriations to the budget holders. MAPMDREF’s investment budget execution over the past five years is also satisfactory with over 86 percent and 65 percent in average, respectively for the commitment and the payment. An annual midterm review of the budget execution has been recently introduced by the Budget Directorate with the view to identify bottlenecks in the budget execution and redeploy the budget appropriations to more performing managers. For the public entities, the investment budget execution rates have sensitively increased for ADA and ONSSA during the period of 2017-19 from an average of 63 percent in 2017 to 86 percent in 2019. However, for the other entities, they did not show satisfactory execution rates as illustrated below. The investment budget execution rate of INRA decreased during the period from 70 percent to 45 percent. For Morocco Foodex, the rate is below the average of the other entities; and lastly for ONCA, this rate remained stable at around 55 percent.
Table A4.3 Commitment and payment rates (Investment Budget)
2017 2018 2019
Commitment Payment Commitment Payment Commitment Payment
ADA 97% 86% 96% 75% 92% 74%
INRA 97% 70% 93% 66% 86% 45%
ONSSA 96% 59% 93% 65% 97% 76%
IAV Hassan II 85% 62% 96% 43% 86% 47%
ONCA 72% 57% 68% 56% 91% 55%
Morocco Foodex
70% 23% 68% 9% 50% 45%
17. Two main factors explain the slight reduction in budget execution indicators. For INRA, ADA and IAV Hassan II, the decrease in the budget execution rate is directly related to the delay in the transfer of funds to these entities. In fact, the share of the budget transferred to them during the fourth quarter of the fiscal year has increased between 2017 and 2019. For INRA, it increased from 15 percent to 44 percent, for ADA, from 26 percent to 39 percent, and for IAV Hassan II, from 0 percent to 52 percent (see table A4.4 below).
Table A4.4 Portion of the budget transferred during the fourth quarter of the fiscal year.
2017 2018 2019
ONSSA 44% 32% 37%
INRA 15% 0% 44%
ADA 26% 0% 39%
IAV Hassan II 0% 0% 52%
ONCA 33% 28% 0%
Morocco Foodex (*) 6% 33%
(*)Not Communicated
56 A being the highest score.
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18. For the other two entities (ONCA and Morocco Foodex), the poor budget performance is much more related to a lack of control over the budget execution cycle, especially in terms of expenditure planning.
19. In order to mitigate the risks related to delays in the transfer of funds and the management of the expenditure cycle, and with the aim of improving the budgetary performance of all the entities involved in the Program, the timely budgeting of activities and the efficient execution of the expenditure program will be closely monitored in the PAP, in coordination with the Financial Departments of these entities and the MAPMDREF during the biannual program supervision missions.
20. Finally, ONCA is developing an integrated fiduciary information system comprising all financial and administrative management modules, including contract management. This integrated Information system, once operational can be proposed to be developed at the level of INRA and IAV. The Bank will ensure close monitoring of the operationalization of this IT system at the level of ONCA and other concerned entities.
21. Effectiveness. Activities included under the expenditure framework are subject to technical and financial assessments in order to ensure their timely execution at envisaged costs. The following measures will contribute to ensuring effectiveness of the Program activities:
• The midterm review of the MAPMDREF and the six entities’ budgets will be extended to the Program. This measure will be monitored as part of the Program Action Plan.
• The improvement of the integrated fiduciary management system within ONCA as to increase timely monitoring of expenditures and production of reliable financial information allowing a credible decision-making process; and ensuring that INRA and IAV are fully on board as well in terms of integrated fiduciary information system.
• Fiduciary capacity building program for the six entities; especially during the first year of implementation of the Program (to be ensured by the Bank and the technical assistance firm operating in the existing PforR).
• The Supreme Audit Institution has a standing oversight mandate over the MAPMDREF but also over related entities. However, an external audit is not annually performed for these entities, the external audit of the Program by the IGF will enable to have certified financial statements that would be annually audited.
• The publication of the Program’s results within MAPMDREF’s website will be included in the Program Action Plan as to increase transparency that will positively affect its effectiveness.
• The timely publication of the annual procurement plans and contracts award results of MAPMDREF and other implementing agencies on their websites and on the Moroccan Public Procurement Portal will also improve the transparency and the implementation of the Program.
Section 3: Review of Public Financial Management Cycle of the entities involved in the Program
22. Planning and budgeting. Overall, the planning and budgeting of all entities involved in the Program follow a structured, timely, and disciplined process which is consistent with the country’s Public Finance Management (PFM) cycle and ensures that allocations fit within the available budget envelope. The 2017 PEFA assesses the country’s planning and budgeting procedures as satisfactory (rated A).
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23. At MAPMDREF level, planning and budgeting processes have some key strengths. Thanks to the DLI #8 on the development and deployment of MISAGRI under the existing PforR, the planning and budgeting processes of the Ministry have improved. The planning module of MISAGRI has been operational since 2019. The deployment of this module has contributed to increasing the effectiveness of the data exchange between the central and the decentralized levels in the planning process (the traceability, transparency and integrity of the whole process have improved). At the level of the entities affiliated with MAPMDREF (ONCA, INRA, ADA, IAV, ONSSA and Morocco Foodex), the planning and budgeting processes are derived from national regulations governing public institutions and they are subject to public financial control57. These rules require (i) the preparation of the budget after consultation with the technical services (within the limits of the medium-term expenditure framework), (ii) approval by their board of directors before the end of the financial year, and (iii) subsequent validation by MAPMDREF. Overall, in recent years, the predictability of their budgets has been somehow satisfactory.
24. The expenditures of the Program are already planned as part of the GGS and are therefore included in the three-year programming of the Finance Act. The expenditure planned for 2021 is programmed in detail in the Finance Act. However, the programming for subsequent years is not granular enough and remains at the level of global projects. At present, the Finance Act is still being finalized. This is due to the context linked to the Covid-19 pandemic crisis. The Bank will ensure close monitoring during implementation of the Program to support granular programming of this strategy year by year with MAPMDREF and MEFRA to avoid any incoherence between the Program expenses and the disbursement rate.
25. With regards to the creation of specific budget lines for Program activities, the MAPMDREF's Finance Department sent an official letter on September 15 to all central entities of the Ministry, for the creation of budget lines, with a deadline of September 30. Only two entities have requested so far the creation of these lines (DSS and DEFR). For the other entities involved in the program (ONCA, ADA, IAV Hassan II, Morocco Foodex, ONSSA and INRA), they will be able to proceed themselves with the creation of budget lines dedicated to Program activities directly in the "E-budget" information system, after validation of their budgets (January 2021). The Bank will continue coordinating with the Financial Directorate of the MAPMDREF and the Directorate of Budget of the MEFRA on the completion of the creation of specific budget lines for Program activities by Program effectiveness.
26. The main risks are related to misalignment of planning and budgeting processes between all the partners involved in the Program. Indeed, differences exist between the budget planning and expenditure budgeting cycles of the Ministry and the main implementing agencies affiliated to it. In the absence of an adequate coordination mechanism, delays in the execution of activities do exist. These risks mainly concern the construction of wholesale markets (MAPMDREF) and the setting up of ten new incubators (ONCA). Another critical risk relates to the multi-year planning of activities to be implemented in order to achieve some of the Program results. This risk relates primarily to upgrading of the ARDNA system (ONCA) and the development of a digital platform for precision farming (INRA), as well as low budget execution rate by these two entities and the IAV.
27. To mitigate the first risk related to the misalignment of planning and budgeting processes between partners, the POM will include the coordination mechanisms to be adopted by executing agencies, such as (i) the signature of agreements and conventions with MAPMDREF, and (ii) a realistic procurement plan and budget planning for the grants transfers to young entrepreneurs. For the second risk, mitigation measures can be also integrated in the POM and based on a detailed Annual budgeted Work Plan and the production of a bi-annual consolidated progress reports, as already performed in the existing PforR. Good practices, such as financial reporting model from the ongoing operation, will be applied in this Program. The key risks and the mitigations measures are outlined in Table A4.5 below:
57 In accordance with Law 69.00 relating to the financial control of the State over public entities.
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Table A4.5: Key Risks and Mitigation Measures
Entities Main Risks Result Area
DLI Mitigation measures
MAPMDREF
Misalignment of planning and budgeting processes between MAPMDREF and the local authorities involved in the selection of sites and the construction of wholesale markets.
2 DLI#5
Agreement between the MAPMDREF and the six entities that defines the timetable for the budget programming of activities. Procurement plan The production of a bi-annual consolidated progress report no later than 45 days after end of semester
ONCA
Misalignment of budgeting processes between ONCA and its partners involved in the creation of the ten new incubators.
1 DLI#1 Budget planning commonly accepted by all partners that specifying the dates for the transfer of funds.
Incorrect scheduling of the budgeting of activities to be carried out in order to upgrade the ARDNA system. Low yearly execution budget rate
3 DLI#8.4
Detailed planning of budgeting and setting up of these activities. Operationalization of the integrated fiduciary IT system The production of a bi-annual consolidated progress report no later than 45 days after end of semester
INRA Low yearly execution budget rate 3 DLI#8.2
Detailed planning of budgeting and setting up of these activities. Based on operationalization of the ONCA integrated fiduciary IT system, consider development or enhancement of a similar system The production of a bi-annual consolidated progress report no later than 45 days after end of semester
IAV Low yearly execution budget rate 3 DLI#8.4
Based on operationalization of the ONCA integrated fiduciary IT system, consider development or enhancement of a similar system The production of a bi-annual consolidated progress report no later than 45 days after end of semester
28. Procurement planning. The implementing entities are all subject to the procurement planning requirements included in the public procurement decree (No. 2-12-349 of March 20, 2013) or in the procurement regulations.
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Procurement plans of the different implementation agencies are advertised on their web sites and /or on the electronic government procurement portal.
29. Procurement profile of the Program. The detailed review of the Program Expenditure Framework did not reveal potential contracts with a cost estimate above the OPRC review thresholds. Based on the expenditure framework, the Program procurement activities are likely to include, 21 percent of civil works and infrastructure improvement, 30 percent of equipment and goods and 22 percent of consulting and non-consulting services. The details of the PEF are presented in Table A4.2 below.
Budget execution
30. Treasury management and funds flow. The funds flow arrangements for Program implementation are adequate. The Program’s funds will be reflected in the Government budget under MAPMDREF and part of them will then be channeled to the other entities involved in the Program. In fact, the expenditures and revenues of the Program are identified in the State budget through the Finance Act and detailed in the annual MAPMDREF budgets and those of the implementing entities. This programming is sufficiently clear and detailed to allow adequate reporting on the implementation of the expenditures planned under the Program. For advances, prior results and achieved results, the funds will be disbursed to the Government’s Treasury Single Account.
31. Accounting. The accounting procedures are based on the public accounting rules applicable to the State's financial and accounting operations. Authorizing officers and accounting officers keep separate accounts called administrative and cash accounts respectively. The administrative accounts kept by the authorizing and sub-authorizing officers are commitment accounts which clearly show the implementation of the budgetary authorizations recorded in the State budget and in the budget of each of the entities participating in the Program. The accounts of the Treasury record the appropriations and the payment of expenditures. The two accounts are reconciled monthly and then annually to reconcile payment orders paid by the accounting officer.
32. The assessment of the existing budget execution, accounting, and reporting processes at the level of each entity of the Program is as follows:
(a) For MAPMDREF and ONSSA, they are already involved in the current PforR. The PEF of the existing PfoR has been executed at 78 percent in 2018 and 82 percent in 2019. At MAPMDREF’s level, budget implementation is monitored by the Integrated Financial Management system MISAGRI, deployed since January 2020 through DLI#8 of the ongoing PforR. Reporting is done from this system and is reflected in the MAPMDREF’s execution report. The financial report comprises a budget execution report which is produced on a semester basis. Thanks to the support of the technical assistance team recruited under the existing PforR, MAPMDREF’s financial report capacity has improved. At ONSSA’s level, the execution of the activities financed by the current PforR complies with the public accounting rules applicable to the financial and accounting operations of the State. The only issues identified at the level of these two entities during the implementation of the current PforR are (i) the delay in the budget execution of the wholesale market of Rabat and (ii) the lack of separate accounting for the activities implemented by ONSSA. However, this last weakness has not prevented the IGF from certifying without qualifications the program's financial statements produced by ONSSA.
(b) For ONCA, ADA, Morocco Foodex, INRA and IAV. All these entities are administered by a board of directors and managed by a chief executive officer. Their budgetary, accounting and reporting procedures are governed by the Law n°69.00 (Dahir n° 1.03.195 of November 11, 2003), regulating the financial control of
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the State over public entities. The control of its expenditures is exercised at two levels. Ex ante, by the State Controller during the commitment of expenditures and by the paying Treasurer for payments. And ex post, by an external audit carried out by a private company as well as by IGF and the Court of Auditors. Their accounting procedures are based on accrual accounting and their budgeting and accounting systems are managed by integrated management systems which would allow the extraction of program expenditure.
33. The main risk identified and related to the existing budget execution, accounting and reporting processes is related to the quality of the consolidated financial reports, which may be compromised by the large number of implementing entities and the lack of a standard reporting format adopted by all these entities. This risk will be mitigated using the reporting template developed in the existing program, which will facilitate the timely production and consolidation of the Program's financial statements. This template will be enhanced to reflect actual Program features and incorporated into the POM.
34. Procurement processes and procedures. The procurement processes and procedures at the different agencies was assessed based on virtual meetings with and data provided by heads of agencies or procurement Divisions. The different agencies procurement systems are acceptable, and they provide reasonable assurance on the achievement of core procurement principles. A summary of the procurement systems of the different agencies are provided below:
a. MAPMDREF. Procurement by MAPMDREF under the Program will be carried out according to Morocco’s existing systems and processes for Public Procurement Management, including the oversight of the Ministry of Finance (MEF). The main procurement methods are Open National Competitive Bidding (ONCB), and Shopping (purchase orders). The use of this latter method is limited to a list of works, goods and services which amount for individual purchase orders cannot excess MAD 250,000 or US$25,000 (ref. list in annex 4 of the Public Procurement Decree (PPD) No.2-12-349 dated 8 “Joumada” 1434 (March 20, 2013). Procurement by MAPMDREF is subject to the review of the “Contrôleur des Engagements” with regards to the respect of procedures and provisions of the PPD. For the MAPMDREF, procurement handling is totally decentralized at the level of the technical departments for their respective activities. Each department sets up its own ad-hoc procurement committees for the management of procurement activities (approval of bidding documents, opening and evaluation of bids and recommendation of contract awards). All contracts including purchase orders (“Bons de commande”) of less than MAD 20 million are signed by the director and the larger ones are signed by the Secretary General of the ministry. This mechanism seems to be well managed. However, delays are frequent in the evaluation of bids phase.
b. Morocco Foodex/EACCE. Founded in 1986, Morocco Foodex is a public structure under the MAPMDREF. Morocco Foodex has its own procurement regulations that are largely consistent with the Public Procurement Decree. In terms of procurement oversight, Morocco Foodex procurement activities are subject to the review of the DEPP (“Contrôleur d’Etat”) with regard to the respect of procedures and provisions of the procurement regulations.
c. ONCA. ONCA is well structured, with three central directorates and a dozen regional ones, and has a well-staffed purchasing department at the central level and purchasing units at the regional level. This organization allows ONCA to efficiently manage the thirty or so contracts contracted annually and where no complaints have been reported. On the digital side, ONCA
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uses eProcurement in almost all tenders58 launched through the Moroccan Public Procurement Portal (PMMP). Furthermore, an ERP (Enterprise Resource Planning) for managing procurement, financial and accounting aspects is being tested and will be deployed in the coming weeks. In terms of contractual timelines, ONCA follows those imposed by the regulation and does not record any significant59 overrun.
d. ONSSA. As SOE, ONSSA has its own procurement regulations dated February 18, 2014. It is
largely consistent with the Public Procurement Decree and is complemented by a manual of procedures, which includes specific details on procurement and contracts execution as well as the roles and responsibilities of different actors involved. In terms of procurement oversight, ONSSA’s procurement activities are subject to the review of the DEPP (“Contrôleur d’Etat”) with regard to the respect of procedures and provisions of the procurement regulations.
e. ONCA. ONCA is well structured, with three central directorates and a dozen regional ones, and
has a well-staffed purchasing department at the central level and purchasing units at the regional level. This organization allows ONCA to efficiently manage the thirty or so contracts contracted annually and where no complaints have been reported. On the digital side, ONCA uses eProcurement in almost all tenders60 launched through the Moroccan Public Procurement Portal (PMMP). Furthermore, an ERP (Enterprise Resource Planning) for managing procurement, financial and accounting aspects is being tested and will be deployed in the coming weeks. In terms of contractual timelines, ONCA follows those imposed by the regulation and does not record any significant61 overrun.
f. INRA. Procurement by INRA under the Program will be carried out according to Morocco’s existing systems62 and processes for Public Procurement Management. The main procurement method is Open National Competitive Bidding (ONCB)63. Purchasing documents are archived in dedicated premises according to a determined procedure and according to an archiving charter and a classification plan. As to the internal audit mechanism, INRA has an audit Guide which facilitates the execution of control work and the verification of processes in relation to the legal and regulatory system governing INRA's purchasing orders (POs). These processes concern: (i) Placing, executing, monitoring and controlling INRA’s POs; (ii) Complaints mechanism handling; (iii) Conclusions and recommendations of the audit. As to human resources, INRA’s purchasing is carried out by two officers (technicians) who are supervised by a Manager- who also coordinates with heads of regional administrative services procurement of regional contracts.
g. IAV. IAV is a public establishment endowed with legal personality and subject to the supervision
of the MAPMDREF. IAV is also subject to the MEFRA’s oversight. IAV’s public procurement activity is governed by the Public Procurement Decree (PPD), complemented by a manual of procedures. With an average of 28 contracts awarded annually, all through open tenders, the
58 All the tenders launched by ONCA are open. No direct contracts passed. 59 The overall timeline for contracting vary between 36 days to 70 days maximum. 60 All the tenders launched by ONCA are open. No direct contracts passed. 61 The overall timeline for contracting vary between 36 days to 70 days maximum. 62 Decree No. 2-12-349 of 08 Joumada 1434 (March 20, 2013) relating to public procurement. 63 Number of tenders: 82 in 2019, 38 in 2018, 78 in 2017.
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contractual deadline is 70 days on average. The Institute has received only two complaints over the past three years, one of which was unfounded. The procurement activity is handled by a purchasing service composed of four people attached to the logistics division. Purchasing documents are archived in dedicated premises and in accordance with a document retention and filing procedure for the various stages of procurement. The internal audit structure controls contracting process in accordance with the provisions of the PPD.
h. ADA. ADA appears to be well equipped for procurement activity in this Program. Indeed, it is well-structured in terms of governance, risk management and procurement. The latter is managed by a dedicated team who handled more than a hundred contracts (all passed through open tenders) and purchase orders during the last three years, and where complaints were about requests for clarification on reasons for elimination, those complaints have all been handled in an appropriate manner. In addition to the procurement regulations, ADA has a manual of procedures relating to support processes, including one which was updated in 2017 related to projects funded by donors and procurement management. Regarding internal control, the agency has developed a procedures’ manual for the handling of fraud and corruption cases. Supported by an internal audit service which annually executes the audit plan following a methodical approach and based on an internal audit charter. On the IT side, ADA has implemented several projects in terms of digitalization including the development of an Information System Master Plan with a roadmap which is currently being implemented. This will include the implementation of an electronic document archiving solution. In addition, the ADA’s physical archiving outsourcing is in progress.
35. The annual average number of contracts established by each agency over the last three years as well as the breakdown by procurement method are summarized in the Table A4.6 below.
Table A4.6 - Procurement methods used by entity
ADA
Year Average number of contracts Open National Competitive Bidding (ONCB)
Single Source
2019
22
23 0
2018 27 0
2017 15 0
IAV
Year Average number of contracts ONCB Single Source
2019
28
29 0
2018 34 0
2017 22 0
INRA
Year Average number of contracts ONCB Single Source
2019
66
82 0
2018 38 0
2017 77 1
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ONCA
Year Average number of contracts ONCB Single Source
2019
54
103 0
2018 33 0
2017 25 0
MOROCCO Foodex
2019 11 11 0
36. Controls, oversight of procurement and audits. In Morocco, public procurement oversight during the procurement and contract award process is mainly performed by the General Treasury (TGR) for the Ministry and affiliated agencies. While each agency conducts its own procurements, the TGR oversees a network of “public accountants,” who sit on evaluation panels and monitor procurement process throughout both the local and national governments. These accountants have the authority to stop procurements if serious violations are found in the implementation of the tenders. Furthermore, the TGR has implemented the Moroccan Public Procurement Portal (e-procurement) and integrated systems to track and implement budget spending and to process payments. In addition to TGR, the Court of Accounts (CoA) conducts post-closeout audits of procurements and issues reports identifying weaknesses or irregularities that are shared with the public. The CoA’s jurisdiction covers all government acquisitions including those implemented by local governments and state-owned entities. The CoA audits are conducted on a systematic basis and are not done randomly. While the CoA does not have a specialized task force for procurement, it has many technical experts who have specialized knowledge of each of the sectors covered by the CoA.
37. E-procurement. The electronic procurement portal has increased the availability of procurement-related information such as bid opportunities, calls for proposals, cost estimates, contract-related documentation and results of tendering publicly available. The electronic procurement system includes additional features such as the electronic submission of bids, a supplier database, electronic reverse auctions, and grouped purchases. However, the e-procurement system is not used to fully process procurement, including electronic submission.
38. Management of complaints in procurement. The National Commission for Public Procurement (NCPP) is a newly established independent institution that provides support for procurement across ministries and oversee all procurement complaints. A separate competition subcommittee exists that is comprised of 14 representatives from across the government who provide advice on pending procurements and work to address competition and complaint issues. The NCPP primary function is to act as the venue for bid complaints, and to issue opinions on all aspects of procurement disputes. This not only includes competition disputes, but also corporate structure and organizational conflicts of interest (OCI) issues and mitigation strategies.
39. Fraud, corruption, and debarment of Contractors. Morocco's new Constitution, enacted on July 1, 2011, explicitly mentions the need to fight corruption and to ensure good governance and transparency as fundamental tools of public sector management. It also recognizes the right to citizen participation in government decision making and public engagement, as well as the right to access public information. The new Constitution sets the groundwork for more transparency and the efficient use of public resources, through Title II on conflict of interest, misconduct in public procurement, misuse of public funds, greater transparency, accountability, and fight against fraud and corruption and through Title XII for good governance. ICPC oversees the prevention of corruption. It conducts awareness raising and information campaigns and has set up a database and a whistleblowing system to allow citizens to alert on corruption cases.
40. Contract administration. The deployment of the MISAGRI’s contract monitoring module system will be critical. Lessons learned from the ongoing farmers’ financing scheme will be considered. In addition, reliance will be placed on
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the financial institution (Credit Agricole du Maroc) already in place to ensure timely disbursement of the funds to the eligible beneficiaries’ bank accounts upon verification of the program’s achievements.
Internal Controls
41. Internal controls. MAPMDREF has an adequate internal control platform including a Manual of Procedures, information management system, segregation of duties between the budget holder and the accountant, culture of results, and risk map. The assessment by the World Bank of the effectiveness of the current practices and the audit reports of the MAPMDREF did not reveal any significant issue. At the level of ONCA, ADA, IAV, INRA and ONSSA, the internal control system of these entities is based on a strict separation of duties between the budget holder and the accounting officer and on ex ante and ex post control of commitments and payments. They also have manuals of accounting and financial procedures, risk mapping and systems for managing financial and accounting information.
42. The key risks identified relate to the implementation of an adequate internal control system handling financial incentive mechanisms for youth. The mechanism: (i) helps youth to start their individual projects: 16,000 young people would benefit from this mechanism; (ii) supports structured agricultural entrepreneurship: 800 service companies would receive incentives with up to 10 young people per company, i.e. 8,000 young people; and (iii) helps young people to finance the rental of agricultural land: 14,500 young people would receive incentives. These identified risks include (i) inadequate beneficiary identification (exclusion of eligible beneficiaries and inclusion of ineligible beneficiaries) and (ii) delays in payments. To mitigate these risks the Program Action Plan will include the development of a dedicated POM and monitoring (see Table A4.7 below).
Table A4.7: Key Risks and Mitigating Measure in Internal Control System for Financial Incentives for Youth
Entities Main Risks Result Area
DLI Mitigation measures
MAPMDREF
For the implementation of the youth financing scheme, two main risks:
- Potential inadequate beneficiary identification (exclusion of eligible beneficiaries and inclusion of ineligible beneficiaries)
- Potential delays in payments.
1 ILD#3
(i) A section in the POM with: (i) criteria and modalities for the selection of the beneficiaries and fiduciary reporting arrangements, (ii) monitoring the results of continuous review of the compliance of the youth investment projects in the annual financial audit of the program by the IGF, and iii) the development of a yearly action plan to follow-up on auditors’ recommendations in this respect.
Close monitoring by the World Bank.
MAPMDREF
For the financial aid for the rental of agricultural land for the benefit of young people, two main risks:
- Inadequate beneficiary identification - Delays in payments.
1 IR#1.5
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Internal Audit
43. Internal audit. The assessment of the internal audit arrangements at the level of each entity of the Program is as follows:
(a) MAPMDREF. IGA carries out internal audits for MAPMDREF. This entity is endowed with adequate auditors and administrative staff. IGA’s reports are submitted to the Ministry. The World Bank reviewed the performance of this entity which plays the role of an independent verification agent for the existing PforR managed by the MAPMDREF. Its performance was assessed as satisfactory. (b) IAV, ADA, ONSSA, Morocco Foodex and ONCA. All these entities have an audit committee, an internal audit department, an audit manual and an internal audit charter. These entities and documents enable them to adopt annual audit plans, monitor their execution and ensure the implementation of recommendations. These internal audit assignments are generally programmed according to a risk-based approach and the reports are transmitted to the CEOs of these entities.
(c) INRA. This entity has a general inspectorate which acts as internal auditor for the central entity and the decentralized entities. It also has a Manual of Procedures which sets out the procedures for planning and carrying out audit missions.
Anticorruption arrangements
44. Risk of fraud and corruption. The Program ex-ante and ex-post financial controls were found adequate to address the risk of fraud and corruption related to the construction of infrastructures and the financing of youth projects respectively under Result Area 2 and 1. These arrangements comprise several effective institutions playing complementary roles: Ombudsman Office, Court of Auditors, General Inspectorate of MAPMDREF (IGA), the National Commission for Public Procurement (Commission Nationale de la Commande Publique- CNCP), and IGF.
45. Actions related to fraud and corruption. The Borrower will: (a) take all appropriate measures to ensure that the Program is carried out in accordance with the Bank’s Anti-Corruption Guidelines; (b) take all appropriate measures to prevent fraud and corruption in connection with the Program, including (but not limited to) adopting and implementing appropriate fiduciary and administrative practices and institutional arrangements to ensure that the proceeds of the Loan are used only for the purposes for which the Loan was granted; (c) promptly inform the Bank of all credible and material allegations or other indications of fraud and corruption in connection with the Program that come to its attention, together with the investigative and other actions that the Borrower proposes to take with respect thereto; (d) unless otherwise agreed with the Bank with respect to a particular case, take timely and appropriate action to investigate such allegations and indications; report to the Bank on the actions taken in any such investigation, at such intervals as may be agreed between the Borrower and the Bank; and, promptly upon the completion of any such investigation, report to the Bank the findings thereof; (e) if the Borrower or the Bank determines that any person or entity has engaged in fraud and corruption in connection with the Program, take timely and appropriate action, satisfactory to the Bank, to remedy or otherwise address the situation and prevent its recurrence; and (f) ensure that any person or entity debarred or suspended by the Bank is not awarded contract under or otherwise allowed to participate in the Program during the period of such debarment or suspension. The Bank’s debarment list, which is easily accessible, will be checked by all procuring entities before awarding contracts.
46. Reporting. The World Bank’s prerogative of administrative inquiry for allegations of fraud and corruption has
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been clarified to the borrower during the Program preparation. The borrower’s collaboration with the Bank on the administrative inquiries into allegations which the Bank intends to pursue has been confirmed during preparation. In accordance with the Bank’s Anti-Corruption Guidelines, the Program will take steps to ensure that “any person or entity debarred or suspended by the Bank is not awarded a contract under or otherwise allowed to participate in the Program during the period of such debarment or suspension”. During the procurement processes, each of the implementing entities will verify the names of the contractor against the Bank’s database (http://www.worldbank.org/debarr) of debarred or suspended contractors to ensure that no such contractor is awarded any contract under the Program.
47. IGA will collect — with support from the abovementioned institutions — and report to the World Bank allegations occurring under the Program through the annual progress reports during Program implementation. The reporting format will include the following: (a) location and date of the complaint, (b) allegation’s description, (c) description of progress in investigation, and (d) investigation outcome. Also, the IGF, which has extensive experience in auditing programs financed by the World Bank, will pay particular attention to allegations of fraud and compliance with the World Bank's guidelines in this area. The terms of reference setting out the modalities of intervention of these two institutions will include specific provisions relating to the verification of compliance with the Bank's guidelines on the prevention of fraud and corruption.
Auditing
48. Program audit. The financial auditing arrangements of the Program are adequate. The IGF is the assigned entity in charge of auditing the GoM programs in line with the country’s financial audit arrangements. The World Bank carried out a comprehensive assessment of the IGF in 2016, complemented by the 2016 PEFA and annual review64 of the performance of this entity. The capacity of this institution revealed the following. First, the IGF has built adequate credibility in auditing the GoM’s programs over the last 20 years owing to the quality of the staff65. Second, the assessment confirms that the entity adequately implements international auditing standards (risk-based process), through a web-based audit software called Blue Audit that is used by all the auditors to plan, carry out, and report on their missions. More than 95 percent of the annual plan is executed. The deployment of Blue Audit—which includes a module on recommendation monitoring—has increased the IGF’s efficiency. Third, the IGF has a track record in auditing five PforRs in various sectors including at the subnational level (health, urban transport, municipal management, agribusiness, and integrated risk management). The objectives of these audits were described in the respective terms of reference and were to provide an opinion on the use of the funds. Key issues underscored in the reports related to (a) ineligible expenditures, (b) absence of risk mapping, and (c) delay in the elaboration of the financial reports. Implementations of the recommendations associated with these issues are ongoing and are being monitored as part of the World Bank implementation support missions.
49. In addition to the audit by the IGF, the implementing entities are subject to some performance audits by the Court of Auditors. In its latest audit report66, the institution highlighted several shortcomings in the agriculture sector included in the relevant sections of the fiduciary assessment (among others, insufficiencies in the maturity and prioritization of the investment projects, delay in the compensation of the population affected by the investment projects).
64 Carried out on March 2017 and February 2018. 65 About 125 auditors. The recruitment plan includes the integration, on a competitive basis over the three upcoming years, of about 25 new auditors, starting from 2017. 66 http://www.courdescomptes.ma/upload/_ftp/documents/12_Programme%20dextension%20de%20lirrigation.pdf
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50. The IGF will carry out the financial audits of the Program expenditures. The Program audited financial statements will include all Program expenditures from all sources of financing. For the purposes of the audit and given that this Program has several implementing agencies, the IGF will conduct its audit on the basis of (i) the consolidated statement of expenditure to be prepared by the MAPMDREF and (ii) the financial statements prepared by the MAPMDREF and the various implementing agencies reflecting their own expenditure under the Program. The audit reports will be carried out on the basis of agreed terms of reference which specify the principles for formulating audit opinions on the basis of these financial statements as a whole, the modalities for verifying the realization of the DLIs and the execution of the Program expenditures. The scope of those audits will include an opinion on the procurement system (screening to prevent debarred and suspended firms from being awarded contracts). The audit reports will be submitted no later than nine months after the closure of accounts.
Procurement and Financial Management Capacity
51. Staff capacity. The Program includes a capacity-building plan to strengthen staff in the various entities of the operation. The assessment of staff capacity both at the MAPMDREF and other implementing entities identified the limited capacity of the staff at the decentralized levels as the main impediment that could affect implementation of the Program:
(a) MAPMDREF. The DF comprises five units and is well-staffed with qualified personnel. It has proven experience in implementing World Bank-financed IPF and PforR projects. With the view to manage the increasing workload, the DF is supported by a technical assistance firm. This arrangement will benefit the Program.
(b) ADA, IVA, INRA, ONSSA, and ONCA. All these entities have enough and qualified staff at central level to
carry out the financial and accounting functions relating to Program activities. However, at the decentralized level, staff capacity may be insufficient, especially to ensure the coordination of activities and the consolidation of financial information. The World Bank would assist implementing agencies in developing financial reporting templates to be used by all actors, both at the central and decentralized levels.
52. Contribution to the PAP. Table A4.8 details the PAP’s fiduciary actions.
Table A4.8. PAP Fiduciary Actions
Entity Risk/Weaknesses Mitigation Action Responsible
Deadlines
Type of Action (PAP, TA, DLI)
MAPMDREF/ADA
• Finalization of dedicated Manual with provisions for the FDA incentive scheme
• Possible misuse of funds for pilot initiative for the emergence and empowerment of agricultural services cooperatives for
Include two sections in the POM:
• A dedicated section for the FDA incentives scheme.
• A dedicated section for pilot initiative for the emergence and empowerment of
MAPMDREF/ADA
30 days after effectiveness
PAP
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Entity Risk/Weaknesses Mitigation Action Responsible
Deadlines
Type of Action (PAP, TA, DLI)
young people agricultural services cooperatives for young people
These two sections will specify the criteria and modalities for selecting beneficiaries and the mechanisms for monitoring results. The review of compliance of youth investment projects with these two guides will be included in the terms of reference of the annual financial audit of the program to be conducted by the IGF. These two guides will be produced by MAPMDREF and ADA, with the support of the Bank, on fiduciary aspects.
MAPMDREF/ DDFP
Delays in the procurement process for the execution of the civil works related to the four wholesale markets
Submission of quarterly procurement performance monitoring reports
MAPMDREF/ DDFP
Quarterly PAP
IAV Acquisition of the computer equipment without launching the new specialized training in data sciences applied to agriculture
Synchronization between the budget process of acquisition of teaching material and the process of accreditation of the new training course by the Ministry of Higher Education and Scientific Research.
IAV During yearly budget programming
PAP
ONSSA Delay in budgeting and execution of technical activities prior to the launch of the geographic information system
Integrated budget schedule, detailing both the timetable for carrying out the project engineering studies and the timetable for acquiring the software and satellite images.
ONSSA During yearly budget programming
PAP
Section 4: Capacity Improvement
53. Capacity building. The financial management capacity building plan is detailed in Table A4.9 below:
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Table A4.9: Measures to Build Capacity in Financial Management
Action Activities Responsible Deadlines Measures
Relevant stakeholders’ capacities building
Development of the training module on: - Financial reporting - Preparation of consolidated
financial statements
World Bank / MAPMDREF
June 2021
- Developed training module
- Reports on the training have been carried out
Strengthening coordination capacities of regional and local entities involved in the program
Organization of working sessions between actors at the sub-national level for: - The development of monitoring
sheets for projects involving several partners at the sub-national level;
- Exchanges of good coordination practices.
World Bank / MAPMDREF
December 2021
- Reports on the working sessions have been carried out
Strengthening M&E of the financial management system
Monitoring and reporting World Bank \ December 2021
Follow-up financial reports submitted by all the implementing entities involved in the program
Section 5: Implementation Support
54. Fiduciary implementation support would include
• Monitoring implementation progress to ensure that the achievement of Program results;
• Support to the borrower to resolve implementation issues and carry out institutional capacity building;
• Compliance with audit reports, including the implementation of the PAP; and
• Monitoring, as relevant, of compliance with the fiduciary provisions of legal covenants.
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ANNEX 5. SUMMARY ENVIRONMENTAL AND SOCIAL SYSTEMS ASSESSMENT
1. The Environmental and Social Systems Assessment (ESSA) was undertaken by the World Bank in the context of the preparation of the Program. The Program is designed to contribute to the implementation of the GGS. In addition, the Program will contribute to the GoM’s response to the crisis brought by the COVID-19 pandemic:
a. The focus on youth employment in rural areas can be a key element of the government's economic response to the ongoing crisis;
b. Support to food supply chains can help seize new opportunities in export markets and ensure the resilience of domestic supply chains in similar future crises;
c. Interventions related to digital agriculture will help accelerate the digital transformation of the sector, made even more necessary by the COVID-19 crisis (social distancing measures);
d. The PforR will contribute to operationalizing the green dimension of the new strategy, particularly with regards to measures for efficient use of water in irrigation, which is a key element in the response to the current drought.
2. The ESSA examines the PforR's environmental and social management systems. It assesses their compliance with the provisions of the Bank Policy and Bank Directive for Program-for-Results Financing with the aim of managing the Program's risks and promoting sustainable development. Paragraph 9 of the Operational Policy (OP) describes the basic principles to be followed in the ESSA. The ESSA focuses on the analysis of (i) the legislative and regulatory framework: laws, regulations, procedures, etc.; and (i) the capacity of the institutions involved in the Program to effectively implement environmental and social management systems (the "system as applied in practice"). The preparation of the ESSA and the development of measures to strengthen the environmental and social management system benefited from a variety of information and an extensive consultation process, including literature review and stakeholder consultations. The draft ESSA was presented and discussed with the various actors and stakeholders during an extensive public consultation on September 8, 2020. Subsequently, it was disseminated and published in order to collect and take into consideration the comments and opinions of the different stakeholders. The participants in the public consultation endorsed the risk analysis presented in the ESSA and the proposed mitigation measures and consider that the proposed action plan and follow-up program are sufficient to ensure its effective implementation.
3. The Program comprises three mutually reinforcing result areas, each consisting of a set of activities, several of which would contribute to more than one result area:
a. Result Area 1: Increased job opportunities and income generation for rural youth;
b. Result Area 2: Improved efficiency of agri-food marketing systems;
c. Result Area 3: Enhanced digitalization of agriculture and adoption of climate-smart practices.
4. Program Beneficiaries: Direct Program beneficiaries will include young people in rural areas, small and medium producers and enterprises engaged in the agri-food sector (of which 25 percent are female). Those beneficiaries and a broader range of stakeholders will also benefit from increased efficiency of wholesale markets, the development of innovations in digital agriculture and improved food safety and quality. Those beneficiaries include enterprises in the agri-food sector, such as aggregators, traders and exporters, as well as Moroccan consumers, who will benefit from safer and better-quality products. It is estimated that approximately 200,000 agri-food producers and entrepreneurs would benefit from one or more of the Program activities in the regions included in the Program area.
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5. Geographical area of the Program. It would include the regions of Tangier-Tetouan-Al Hoceima, Oriental, Fez-Meknes, Rabat-Salé-Kénitra, Béni-Mellal-Khénifra, Casablanca-Settat, Marrakech-Safi, Draâ-Tafilalet, Souss-Massa and Guelmim-Oued Noun.
6. The overall coordination of the implementation of the Program is entrusted to MAPMDREF. It will be exercised through DSS. MAPMDREF will be responsible for the overall coordination of financial management and procurement for the Program. The IGF will carry out financial audits of the Program’s expenditures incurred by MAPMDREF and the entities affiliated to the Program. Finally, the environmental and social responsibilities related to the implementation of the Program will be entrusted to the DSS with the support of the PMU (See Figure A3.2).
7. Environmental and social risks of the Program. The positive effects are numerous and are expected to continue over the long term with respect to the following aspects:
a. The exclusion, by virtue of the very nature of the Program, of any investment involving significant or major environmental and social risks.
b. The type of limited and small-scale developments and infrastructure, which are generally well located and relatively limited in spatial extent.
c. Structures and facilities that are not expected to generate major cases of air or noise pollution or significant environmental degradation.
d. Feasibility, effectiveness and realism of the planned activities, based on the results of prior diagnostic studies, according to precise social, economic and environmental parameters.
e. The existence of various controllable and effective measures to mitigate possible risks and ensure impact monitoring, both during the construction phase and during the operation of the works.
f. The existence of specialized institutions capable of managing most of the environmental and social aspects of the Program.
g. The existence of a "Strategic Vision for the integration of women in the development of agricultural value chains", based on a variety of national instruments to advance gender equality.
h. The existence of an appropriate legal arsenal to effectively manage all aspects of the environmental and social management of the Program.
8. The environmental and social risks and negative impacts associated with the Program are considered moderate in their entirety. They will be reversible and easily mitigated with proposed measures. They will be easy to identify in advance and to prevent and minimize through effective mitigation measures and will be subject to an efficient environmental monitoring and follow-up system that will allow for the identification and management of potential risks in real time. Considering their importance to the sustainability of the Environmental and Social management system, some of these mitigation measures have been identified in the E&S Action Plan.
9. The environmental and social diagnosis of the various activities has made it possible to categorize them according to their risk potential and to identify both the planning tools required and simple and effective control and monitoring systems. The activities funded under this Program, which have the potential to generate environmental risks, relate to result area 2 (RA 2) and correspond to "Improved market efficiency and integration of value chains: (i) creation of four wholesale markets (Agadir; Meknes, Marrakesh and Berkane)". The E&S risks of these activities could be
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expressed during the different phases of their implementation. These risks have been identified and appropriate mitigation measures defined for each of the development, construction and operation phases.
10. Evaluation of the Program's E&S system. In order to fill the gaps identified in the ESSA, this Program will support specific measures to strengthen the performance of Morocco's environmental and social management system. These measures will be implemented through an Environmental and Social Management Action Plan for the Program's activities, incorporating a set of concrete and specific measures. The ESSA Action Plan identifies two sets of recommendations. Each component includes distinct and complementary activities.
11. The first set of recommendations relates to Capacity Building and the MAPMDREF environmental and social management system:
a. Technical manual. The specific element of this component concerns the preparation of a Technical Manual for Environmental and Social Management (MTGES). This Manual will be consistent with both national procedures for environmental and social assessments and the provisions of the World Bank's Operational Policy for the financing of PforRs. The requirements of the Manual for the preparation of an Environmental and Social Management Plan (ESMP) for structural activities with moderate environmental and/or social risks shall also be set out in the Contractors' individual Terms of Reference (ToR).
i. The Manual will be prepared by MAPMDREF/DSS for its technical services and all stakeholders to ensure that environmental and social management procedures are properly understood and fully appropriate, in particular:
1. the technical staff of the MAPMDREF Directorates concerned
2. the technical staff of the ONSSA
3. ADA technical staff
4. ONCA technical staff
5. the staff of the wilayas and communes concerned
6. the staff of the interprofession and Morocco Foodex.
ii. The MTGES will be prepared during the first three months of Program implementation, describing the methodology and bringing together environmental and social management procedures and tools (analysis of social and environmental risks, identification and implementation of mitigation measures, complaint management, monitoring and reporting).
b. Manual validation workshop. A workshop will be organized to present the main lines of the MTGES to the representatives of the main stakeholders of the Program to collect their opinions and suggestions, before the preparation of the final version, which will be approved and published by MAPMDREF.
c. Focal point. A person will be designated to act as the focal point for the environmental and social management of the Program. This Focal Point will be attached to the PMU and will have the responsibility in close collaboration with all stakeholders, to ensure:
iii. The coordination and monitoring of the implementation of measures to strengthen social and environmental management systems, including the establishment and monitoring of
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the grievance redress system;
iv. the collection and centralization of all information relating to social and environmental risks and their mitigation measures;
v. the monitoring and evaluation of the implementation of mitigation measures and data integration at the information system level as well as reporting (in accordance with the principles described and presented in the MTGES).
12. The second set of recommendations concerns the strengthening of the implementation and monitoring of the environmental and social management system of the Program's main actors and stakeholder representatives. This component includes four distinct types of initiatives:
a. Information, awareness-raising: Organization of several initiatives aimed at raising awareness and informing a fairly large audience about the environmental and social issues of the Program's structural activities.
b. Training: This includes the organization of more specialized training sessions for stakeholders directly involved in the implementation of the Program's investments to build their capacity on PforR environmental and social issues. This will include, in particular (i) understanding of the MTGES and procedures and practices; and (ii) mastery of environmental and social management tools,
c. Strengthening environmental regulations by preparing and monitoring the integration of environmental and social management aspects in the future Law that will govern the development and operation of agri-food platforms.
d. Carrying out a strategic environmental and social assessment of the wholesale market master plan. This strategic assessment will, among other things, assess the environmental and social impacts of wholesale market activities and define the appropriate procedure to eliminate and/or mitigate these impacts in order to support the sustainability of the master plan.
13. Environmental and social reporting: the monitoring sheets and reports contained in the MTGES, once completed, will be verified and consolidated at the level of the PMU Environmental and Social Focal Points.
14. Table A5.1 below presents all the elements of the Environmental and Social Action Plan that will form an integral part of the Program Action Plan. The cost of all the actions identified, concerning both the environmental and social components of the ESSA, will be included in the overall budget of the Program:
Table A5.1 Elements of the Environmental and Social Action Plan that will form an integral part of the Program
Action Plan Action Activities Responsible
persons
Deadlines Measures
Actions to strengthen the environmental and social management system and capacities
Technical Manual
(Manual of Good
Environmental and
Social Management
Practices)
Development of the technical manual
Tools on environmental and social
systems strengthening to be included in
the manual
PMU/E&S Focal
Point
May 2021
Technical
manual
submitted and
approved by the
World Bank
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Validation workshop with stakeholders
January 2021
Dissemination
Plan
Environmental and
Social (E&S) Focal
Point
Elaboration of Terms of Reference
PMU/E&S Focal
Point
Mission
Statement Appointed
Dissemination and
Training on the
Technical Manual
Dissemination of the E&S Technical
Manual
Training of key staff of Program
stakeholders (PSSD, DF, ONSSA, ADA,
DPA, ORMVA, RRA, etc.).
From the
second half of
2021
Number of key
personnel
trained
Grievance Redress
Mechanism
1) Development of a grievance
collection template specific to the
Program;
2) Information, Communication and
Dissemination to Program
Stakeholders;
3) Development of a grievance
reporting model
PMU/E&S Focal
Point
June 2021 1) Model
submitted and
approved by the
World Bank
2) Number of
stakeholders
adopting the system;
3) Reporting
model submitted and
approved by the
World Bank
Measures to strengthen implementation and monitoring
the environmental and social management system
Strategic
Environmental and
Social Assessment
Wholesale Markets Strategy/Master
Plan Strategic Environmental and
Social Study
PMU/E&S Focal
Point
End of June
2021
SESA submitted and
approved by the
Bank
Environmental and
social impact studies
of wholesale
markets
Realization of the ESIAs and
depending ESMPs of the 4 wholesale
markets
PMU/E&S focal
point
The ESIA of
the 4-
wholesale
markets
completed
before the
end of
December
2021
ESIAs and depending
ESMPs submitted and
approved by the
World Bank
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Inclusion and
disability plans
Ensure that wholesale market
infrastructure is accessible to all
(such as toilets)
PMU/E&S focal
point
During
technical
planning
Inclusion and
disability plans
developed
Social action plans
for wholesale
markets
Preparation and implementation of a
social action plan for each wholesale
market PMU/E&S focal
point
Before
transfer of
activities to
new
wholesale
markets
Social action plans
developed, consulted
with stakeholders,
and implemented
Code of conduct Preparation of codes of conduct by
participating enterprises to reduce
sexual harassment and gender-based
violence
PMU/E&S focal
point
Participating
enterprises
Program
duration
Regular reporting by
E&S focal point to
WB
Grievance Redress
Mechanism
Collection and processing of
grievances PMU/E&S focal
point
Program
Duration
Half-yearly report
submitted by the E&S
Focal Point
Environmental and
social management
procedures
Implementation of all procedures
and tools defined in the technical
manual
PMU/Focal
Point (E&S)
Made before
end of May
2021
Implemented
throughout
the Program
Follow-up reports
submitted by the
focal point
Environmental and
social monitoring
procedures
Regular collection of reports
Program
duration:
- Quarterly:
Internal to the
PIU
- Semi-annual:
Shared with
the Bank
Enforcement and
Regulatory
Strengthening
Consideration of E&S management
in MoI’s Arrêté fixing the modalities
regarding the creation and
functioning of the modernized
wholesale markets.
Before the
end of
December
2021
Text acceptable to
the Bank
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.
ANNEX 6. PROGRAM ACTION PLAN
Action Description Source DLI# Responsibility Timing Completion Measurement
(i) POM approved by the Borrower, and (ii) instructions issued for its use by Program implementing entities
Technical MAPMDREF Other 30 days after Effectiveness; March 2021
POM approved and instructions issued
Recruitment of TA to strengthen PMU capacities
Technical MAPMDREF Due Date 30-Jun-2021 TA recruitment contract signed
Appointment of E&S Focal Point
Environmental and Social Systems
PMU/E&S Focal Point Due Date 31-Mar-2021
Mission Statement
Development of a Technical Manual (Manual of Good Environmental and Social Management Practices) and preparation of validation workshop
Environmental and Social Systems
PMU/E&S Focal Point Due Date 31-May-2021
Technical manual submitted and approved by the World Bank
Dissemination Plan
Dissemination and training on the Technical Manual
Environmental and Social Systems
PMU/E&S Focal Point Other From the second half of 2021
Number of key personnel trained
Environmental and social management procedures - Implementation of all procedures and tools defined in the Technical Manual
Environmental and Social Systems
PMU/Focal Point (E&S) Other Before 31-May-2021, implemented throughout the Program
Follow-up reports submitted by the Focal Point
Strategic Environmental and Social Assessment - Wholesale Markets Strategy/Master Plan SESA
Environmental and Social Systems
PMU/E&S Focal Point Due Date 30-Jun-2021 SESA submitted and approved by the Bank
Environmental and Environmental PMU/E&S Focal Point Other 31-Dec- ESIAs and depending ESMPs
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Social Impact Studies of wholesale markets - realization and publication of the ESIAs/ESMPs for each of the 4 wholesale markets and, as applicable, resettlement action plans.
and Social Systems
2021 but prior to the commencement of the civil works
submitted and approved by the World Bank
Enforcement and regulatory strengthening - Consideration of E&S management in MoI’s Arrêté fixing the modalities regarding the creation and functioning of the modernized wholesale markets
Environmental and Social Systems
PMU/Focal Point (E&S) Other Before the end of the 1st year
Text acceptable to the Bank
Development of inclusion and disability plans
Environmental and Social Systems
PMU/E&S focal point Other During technical planning
Inclusion and disability plans developed
Development of a Grievance Redress Mechanism and related reporting model
Environmental and Social Systems
PMU/E&S Focal Point Due Date 30-Jun-2021 Model submitted and approved by the World Bank;
Number of stakeholders adopting the system;
Reporting model submitted and approved by the World Bank.
Grievance Redress Mechanism - Collection and processing of grievances
Environmental and Social Systems
PMU/E&S focal point Other Program duration
Half-yearly report submitted by the E&S Focal Point
Preparation of quarterly procurement performance monitoring reports to reduce delays in the procurement process
Fiduciary Systems
MAPMDREF/ DDFP Recurrent Quarterly Availability of quarterly procurement performance monitoring reports
Preparation and implementation of social action plans for wholesale
Environmental and Social Systems
PMU/E&S focal point Other Before transfer of activities to new
Social action plans developed, consulted with stakeholders, and implemented
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markets wholesale markets
Preparation and signing of (and compliance with) code of conduct
Environmental and Social Systems
PMU/E&S focal point Participating enterp
Other Program duration
Regular reporting by E&S Focal Point to WB
Environmental and social monitoring procedures - Regular collection of reports
Environmental and Social Systems
PMU/Focal Point (E&S) Other Program duration
Follow-up reports submitted by the Focal Point
Synchronization between the budget process of acquisition of teaching material and the process of accreditation of the new training course by the Ministry of Higher Education and Scientific Research
Fiduciary Systems
IAV Other During yearly budget programming
Synchronization ensured
Development of integrated budget schedule, detailing both the timetable for carrying out the project engineering studies and the timetable for acquiring the software and satellite images.
Fiduciary Systems
ONSSA Other During yearly budget programming
Integrated budget schedule prepared
Inclusion of two sections in the POM:
• A dedicated section for the youth financing scheme.
• A dedicated section for pilot initiative for the emergence and empowerment of agricultural service cooperatives for
Fiduciary Systems
ADA/PMU Other 30 days after Effectiveness
POM sections dedicated to youth financing completed.
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young people.
Establishment of a simple integrated M&E system for Program implementation
Other MAPMDREF Due Date 31-Mar-2021
M&E system deployed and operational
Conduct of mid-term evaluation and end-of-Program implementation evaluation of results and impacts
Other MAPMDREF Other 30 June 2023 (mid-term), 31 March 2025 (end-of- Program)
Evaluations completed
.
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ANNEX 7. IMPLEMENTATION SUPPORT PLAN
1. The Implementation Support Plan (ISP) is based on the implementation support guidelines for Program-for-Results operations and adapted to the design and risk profile of the Program. While the Borrower is responsible for the Program’s overall implementation, including its technical aspects, the basic mandate of Bank implementation support under the Program includes: (i) review implementation progress, including the PAP and the achievement of program results and DLIs; (ii) provide support for resolving emerging Program implementation issues and bottlenecks; (iii) provide technical and institutional capacity building support to the Government for implementation of the PAP, the achievement of DLIs and other results; (iv) monitor the adequacy of systems’ performance (e.g. through monitoring reports, audit reports, and field visits) as well as compliance with legal agreements and, as needed, the Program Action Plan; and (v) support the government in monitoring and managing changes in the various types of risks.
2. The ISP focuses on actions that the Bank will perform and on associated needs in terms of skills and resources. Successful support and monitoring of Program implementation will require a multidisciplinary set of technical specialists along with fiduciary and environmental and social specialist. The approach is to mobilize the Bank’s global expertise at the outset to help with operationalizing design improvements while relying on a core group of technical specialists to provide regular guidance and implementation support to the agencies involved in Program implementation. While results and DLIs will be assessed as completed annually, a four-month approach to implementation support, where a specific one-week implementation support mission would be carried out, will be used during the first year of the Program. This approach will shift to a six-month approach during the remaining four years of the Program. In addition, a number of technical specialists are based in the region and country office, which will allow timely follow-up on specific issues and/or areas of concern if needed.
3. The Program will require well-coordinated technical support from the World Bank, particularly during the early stages of implementation. Program implementation will involve the combined intervention of various government stakeholders. This includes MAPMDREF departments and agencies (DF, DDFP, DSS, DEFR, ONSSA, ADA, ONCA, DRAs) as well as other Ministries (MEFRA, MICEVN and MI) and entities (Wilayas).
Table A7.1 Main Focus of Implementation Support
Time Focus Skills Needed Resource Estimate
Months: 0-12
Implementing the PAP; adjusting operational procedures and their communication to implementing entities; establishing arrangements for independent verification of compliance with the DLIs; strengthening the M&E system at various levels.
Fiduciary; environment and social management; M&E; Technical (Youth Entrepreneurship; Wholesale Market Infrastructure Development; Climate Smart Agriculture, Digital Technologies; Food Safety; Extension Services)
3 implementation support missions Total 36 weeks over 12 months
Months: 13-60
Reviewing implementation progress; cross-checking linkages between planning, budgeting, and results;
Fiduciary; environment and social management; M&E; Technical (Youth Entrepreneurship; Wholesale Market Infrastructure
2 implementation support missions per year including mid-term review:
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providing support in case of disputes relating to DLI verification.
Development; Climate Smart Agriculture; Digital Technologies; Food Safety; Extension Services)
Total 96 weeks over 48 months
Table A7.2 Task Team Skills Mix Requirements for Implementation Support (entire program life)
Skills Needed Number of Staff Weeks Number of Missions
Task Team Management 30 11
Youth entrepreneurship 13 11
Wholesale Market Infrastructure Development
11 11
Climate Smart Agriculture 15 7
Digital Technologies 11 11
Agricultural Extension 11 11
M&E 11 5
Procurement, FM, and Governance 11 5
Environmental and Social Management 10 5
Legal 1 0
Table A7.3 Role of Development Partners in Program Implementation
Name Role
FAO Mobilize technical specialists (in particular on Climate Smart agriculture and Food Safety) through WB-FAO Cooperative Program to participate in implementation support
AFD AFD will participate in the supervision missions of the World Bank and be involved in the continuous dialogue with MAPMDREF regarding GGS implementation activities. AFD will ensure, along with the World Bank, the coordination between the PforR and the TREEA program.
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ANNEX 8. CATALYZING GROWTH, INCLUSION AND JOBS THROUGH AGRICULTURE IN MOROCCO
1. As a result of a decade of investment under the PMV, agriculture has experienced strong production growth, climate vulnerability has fallen from a very high initial level, and total factor productivity has rapidly increased. The strong policy commitment to the productivity, competitiveness and development objectives of the PMV have been underpinned by significant public and private investment exceeding 88 billion dirhams over the 2008-2010 period and reaching around 12 percent of the total government investment budget by 2017. Productivity growth in agriculture over this period has been much higher than in the other sectors of the economy. In terms of the distribution of agricultural investment, regions more dependent on agriculture have received a higher share of investment under PMV.
2. Agriculture’s strong growth performance over the last decade has been underpinned by extensive agriculture support through the investment catalyzed by the PMV. The international comparison of Morocco’s agriculture support shows that as share of GDP, the level of support over the 2013-2017 period has been in the same range as other countries and that most of the time during that period this support is even lower than in most OECD countries. Taking into account that agriculture represents a small share of the GDP in OECD countries, while it represents a large share of Morocco GDP, Morocco’s support to agriculture remains relatively small by comparison to other countries.
Table A8.1: Total Support Estimate as Share of the Country GDP (in %)
Sources: 1/Authors’ calculations (for Morocco), and 2/ OECD (various years, for other countries).
2013 2014 2015 2016 2017
Morocco1/
0.34 1.64 0.67 1.20 0.50
OECD Estimations:2/
1. OECD Countries
Australia 0.15 0.16 0.13 0.17 0.22
Brazil 0.49 0.44 0.37 0.48 0.35
Canada 0.39 0.35 0.34 0.39 0.32
Chile 0.29 0.32 0.33 0.30 0.31
Colombia 1.89 1.58 1.55 1.48 1.12
European Union (28 countries) 0.90 0.76 0.79 0.78 0.75
Iceland 0.96 1.16 1.20 1.20 1.11
Japan 1.02 0.91 0.87 0.96 0.97
Korea 1.88 1.67 1.65 1.51 1.55
Mexico 0.60 0.66 0.65 0.54 0.56
New Zealand 0.28 0.28 0.26 0.28 0.24
Norway 0.80 0.86 0.91 0.96 0.88
OECD - Total 0.70 0.65 0.65 0.65 0.62
Switzerland 0.99 1.11 1.10 1.11 1.03
Turkey 1.94 2.21 2.35 2.46 1.94
United States 0.52 0.53 0.50 0.49 0.46
2. Non-OECD Countries
Argentina -3.30 -4.15 -2.04 -0.81 -0.53
China (People's Republic of) 2.48 2.36 2.41 2.22 1.96
Costa Rica 0.92 0.80 0.99 0.80 0.56
India -3.83 -0.96 1.10 0.11 0.65
Indonesia 3.23 3.58 3.86 3.82 3.68
Kazakhstan 1.20 0.66 1.22 0.28 0.69
Philippines 3.42 3.59 3.18 2.93 2.63
Russia 0.99 0.65 0.81 0.81 0.71
South Africa 0.27 0.28 0.39 0.23 0.30
Ukraine 0.35 -0.16 0.29 -0.30 -0.09
Viet Nam 0.90 0.11 -0.12 -0.56 0.27
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3. The government's agricultural policy and investment in recent years has resulted in strong average growth in agricultural value added. As shown in figure A8.1.a, between 1999 and 2018 the primary sector (agriculture) recorded an average annual growth in real value of 5 percent, surpassing that of services (tertiary sector), which was 4 percent, and that of the secondary sector (industry and public work), which was 3 percent. Much more important is the strong growth in partial labor productivity, as well as total factor productivity (TFP). Indeed, and as shown in figure A8.1.b, in real terms value added per worker in the primary sector increased at an annual growth rate 5 percent between 1999 and 2018, while growth rates of partial labor productivity were only about 2 percent in the industrial and services sectors.
Figure A8.1: Evolution of Real Value-Added Growth in the Three Large Sectors of the economy (base 100: 1999)
a. Value Added b. Value Added Per Worker
Source: Own estimates based on official HCP data.
4. The sustained growth performance in agriculture has been achieved mainly through intensification and investment growth. The agricultural policy implemented in recent years, and in particular since the launching of the PMV, has placed particular emphasis on agricultural investment and has resulted in a significant increase in the stock of capital in agriculture. That has in turn led to a significant growth of total factor productivity (figure A8.2.a). In terms of each component’s contribution to the observed growth, the contribution of labor was a negative one (-7%) while contributions of capital and TFP were positive, respectively by 36 percent and 72 percent
Figure A8.2: Relative Importance of Growth Sources and Productivity (base 100: 1999)
a. Contribution to Real Value Added, by source b. Total Factor Productivity
Source: Own estimates based on official HCP data.
5. Analysis of the determinants of the sector's output growth shows that this was mainly driven by capital investment and growth in total factor productivity and occurred in the presence of strong dis-incentives provided
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by the diminishing real producer prices. Indeed, as figure A8.3.a shows, producer prices have been stagnant over the past two decades, while agricultural input prices have increased by almost 28 percent over the same period.
Figure A8.3: Agricultural Intermediate Consumption’s Shares and Prices a. Intermediate Consumption and Producers’ Prices b. Intermediate Consumption and Value-Added Indices Shares
6. Thus, Morocco has fared well until now in terms of increasing production and productivity in agriculture. But it is now facing a challenging environment as further productivity gains cannot continue without a shift in the strategy. As productivity improvements have been driven mainly by capital investment, in terms of promoting financial sustainability of investment in agriculture, there is significant scope for further gains by increasing labor productivity and further leveraging private investment in agriculture through a greater focus on strengthening the enabling environment for private investment in the agri-food sector in the rural space.
7. Unemployment in rural areas is increasingly becoming a problem that affects the youth disproportionately, with the resulting challenging social issues in rural Morocco. At the same time, a positive development is that child labor in agriculture has declined very significantly—and increasing agricultural productivity often has a catalytic role to provide access to education for children, for example through agriculture cooperatives engagement in social projects.
8. Furthermore, on the positive side, employment in the agri-food value chains (agribusiness) has been rising, with much higher scope for growth potential as income growth and structural transformation and a rural-urban transition in Morocco continues. In contrast to rural agricultural employment, non-agricultural rural activities show an increase in overall employment. In effect, between 1999 and 2017 there was the same trend of a decrease in employment for the active population under the age of 25 years (-65 thousand jobs) and an increase in employment for the active population above of the age of 24 years, except that the increase in employment in this second category far exceeded the decrease of the former. The result is a positive increase in non-agricultural rural activities of 0.44 million employments between 1999 and 2017. This evolution indicates that the observed growth in agriculture is inducing more job creation in rural areas and outside the sector. Another indication of this agriculture-induced job creation outside the sector itself can be illustrated by the increase of employment in the agri-processing sector since the employment in this sector has more than doubled in the last 20 years (figure A8.4).
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Figure A8.4: Sector and Induced Employment by Agriculture
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ANNEX 9. GREEN GENERATION STRATEGY: BRIEF PRESENTATION
1. Through the PMV (2008-2020), Morocco has been supporting the green economy and seeking to increase the resilience and adaptation of rural populations to climate change. The PMV was launched in 2008 with the aim of supporting the growth and competitiveness of the agricultural sector, leveraging it to support inclusive growth, particularly among poor and rural populations, and enhancing the resilience of the sector to weather volatility and climate change. In late 2019, the mandate of the Ministry of Industry and Trade was expanded to also include the portfolios of Digital and Green Economy, further highlighting the GoM’s commitment to seizing the opportunity of green growth and tackling head-on the challenges posed by climate change. On February 13, 2020, King Mohamed VI launched the new development strategy “Green Generation 2020-2030” (GGS) to build on the success of the PMV and create a new generation of agricultural workers and entrepreneurs particularly among young and rural populations, with innovative support measures.
2. Under the GGS, the GoM is now looking at ways to deepen and increase the positive impacts of the PMV. On the production and marketing side, the evaluation of the PMV carried out by MAPMDREF in 2018 highlights three main areas of improvement: (i) better structuration of distribution channels; (ii) the modernization of slaughterhouses; and (iii) more value addition. But the same evaluation also points to the need for a more inclusive strategy, acknowledging that the PMV has not benefited enough small-scale producers and other vulnerable groups, particularly women and youth. Lastly, the GGS indicates that more needs to be done to develop a sustainable agricultural sector. Hence, building on the achievements of the PMV, the new strategy focuses on creating a rural middle class with a strong focus on increasing human capital and ensuring sustainable agricultural development.
3. The GGS rests on two pillars: (i) human capital; and (ii) sustainable development of the agriculture sector. Under the first pillar, the GGS focuses on: (i) supporting the development of a new generation of agricultural middle class; (ii) supporting young agricultural entrepreneurs; (iii) solidifying agricultural organizations; and (iv) strengthening support mechanisms. Under the second pillar, the strategy focuses on: (i) consolidating agricultural value chains; (ii) establishing modern and efficient trade and distribution channels; (iii) ensuring product quality, strengthening innovation and green-tech; and (iv) ensuring a resilient and eco-efficient agriculture sector.
4. Under the first pillar of the GGS, the GoM aims at contributing to the emergence of an agricultural middle class by improving farmers income and social protection. The GGS aims at doing this by: (i) improving incentives and their respective targeting to increase farm revenues and allow an additional 350-400,000 farmers to become part of the middle class (objective of 690,000 farmers to be part of the middle class); (ii) extend insurance coverage to an additional 2.5 million hectares of agricultural land; (iii) improve farmers access to social protection, ensuring that 3.3 million farmers or 80 percent of all farmers have access to social protection; (iv) increase the Guaranteed Minimum Agricultural Wage (Salaire Minimum Agricole Garanti, SMAG)and reduce the gap between SMAG and the Minimum Legal Wage (Salaire Minimum Légal, SMIG) by 2030.
5. Furthermore, the GSS aims at supporting the stronger inclusion of young professionals into the agriculture sector and offering related opportunities for income generation. The GoM intends to do this by: (i) improving the economic use of an additional 1 million ha of agricultural land; (ii) supporting already existing and the establishment of new farms and thereby attracting 180,000 new farmers; (iii) supporting entrepreneurship activities and thereby creating 170,000 new jobs; (iv) strengthening education and qualification services and
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educating 150,000 youth. These activities aim at ensuring the intergenerational transmission of farms and the continuous development of the agricultural sector.
6. In addition, the GSS aims at ensuring a better structuration and aggregation of farmers around agricultural organizations and reforming and modernizing the support mechanisms to professionalize the agriculture sector. The GoM aims at doing this by: (i) establishing new socio-economic organizations and ensuring that 25 percent of farmers are organized accordingly; (ii) empowerment of the profession (iii) reforming agricultural extension services and increasing the numbers of extension workers to reach 5,000; (iv) providing digital agricultural services and ensuring that 2 million farmers are connected to agricultural e-services; and (v) supporting a new generation of social agriculture projects and ensuring that an additional surface of 350-400 ha is covered by social agriculture projects.
7. Under the second pillar of the GGS, the GoM aims at further supporting the development of agricultural value chains by ensuring a more targeted intervention in the upstream segment and a reallocation of efforts in the downstream segment. The GoM aims at doing this by (i) maintaining investment efforts and rationalizing incentives upstream; (ii) supporting the competitiveness of exports; (iii) increasing the value addition of agricultural products and ensuring that 70 percent of products benefit from value addition; and (iv) supporting the emergence of new agricultural value chains and increasing the area cultivating organic products by 100,000 ha.
8. Furthermore, the GSS aims at better structuring and modernizing distribution channels, improving product quality sold to final consumers, and investing in water and energy efficiency in order to preserve natural resources and to create new income-generating and employment-generating activities. Specifically, the GoM aims at (i) modernizing 12 wholesale markets; (ii) rehabilitating various souks; and (iii) strengthening distribution channels and storage platforms. To ensure a higher product quality, the GoM aims at (i) diffusing innovation, R&D, and precision agriculture; and (ii) reinforcing food safety and quality management. To preserve natural resources the GoM aims at (i) implementing water mobilization and saving programs; (ii) promoting renewable energy sources; and (iii) disseminating soil conservation techniques. By doing this the GoM expects the registration of 30-50 new varieties, increased investment in R&D by 1.5-2 times, accreditation of 120 slaughterhouses, implementation of effective sanitary and phytosanitary control measures, and livestock tracing reaching 100 percent.