Document o f The World Bank FOR OFFICIAL USE ONLY Report No: 43942-GD PROJECT APPRAISAL DOCUMENT O N A PROPOSED CREDIT IN THE AMOUNT OF SDR 2.10 MILLION (US$3.0 MILLION EQUIVALENT) TO GRENADA FOR THE OECS SKILLS FOR INCLUSIVE GROWTH PROJECT IN SUPPORT OF THE SECOND PHASE OF THE OECS SKILLS FOR INCLUSIVE GROWTH PROGRAM December 16,2008 Human Development Sector Caribbean Country Management Unit Latin American and the Caribbean Regional Office This document has a restricted distribution and may be used by recipients only in the performance o f their official duties. I t s contents may not otherwise be disclosed without World Bank authorization. Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized CURRENCY EQUIVALENTS (Exchange Rate Effective November 9,2008) Currency Unit = Eastern Caribbean Dollar EC$2.6882 = US$l.OO US$1.43 = SDR 1 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activity AHLA American Hotel and Lodging Association APL Adaptable Program Loan CARICOM Caribbean Community CAS Country Assistance Strategy CDO Community Development Officer CKLN Caribbean Knowledge and Learning Network CSME Caribbean Single Market and Economy CVQ Caribbean Vocational Qualification cxc Caribbean Examination Council ECCB Eastern Caribbean Central Bank EU European Union GCTVET Grenada Council for Technical and Vocational Education and Training GDP Gross Domestic Product GHTA Grenada Hotel and Tourism Association GTEP Grenada Training and Employment Project HEART Human Employment and Resource Training Trust NTA National Training Agency NVQ National Vocational Qualification MIS Management Information System MOE Ministry o f Education MOEDP Ministry o f Economic Development and Planning N I S National Insurance Scheme OAS Organization o f American States OECS Organization o f Easter Caribbean States PDO Project Development Objective TAMCC T.A. Marryshow Community College TVET Technical and Vocational Education and Training Vice President: Pamela Cox Country Director: Yvonne Tsikata Sector DirectodManager: Evangeline Javier / Chingboon L e e (Acting) Sector Leader: David Warren Task Team Leader: Angela Demas .. 11 FOR OFFICIAL USE ONLY GRENADA OECS (GD) Skills for Inclusive Growth CONTENTS Page I. STRATEGIC CONTEXT AND RATIONALE .................................................................. 1 A . Country and sector issues .................................................................................................... 1 B. Rationale for Bank involvement ......................................................................................... -2 C . Higher level objectives to which the project contributes .................................................... 3 I 1. PROJECT DESCRIPTION. ............................................................................................. 3 A . Lending instrument. ............................................................................................................. 3 B. Program objective and Phases ............................................................................................. 3 C . Project development objective and key indicators .............................................................. 4 D. Project components .............................................................................................................. 5 E. Lessons learned and reflected in the project design ......................................................... -10 F. Alternatives considered and reasons for rejection ............................................................. 13 I11. IMPLEMENTATION. .................................................................................................... 14 A . Partnership arrangements .................................................................................................. 14 B . Institutional and implementation arrangements ................................................................ 14 C . Monitoring and evaluation o f outcomeshesults ............................................................... -15 D. Sustainability ..................................................................................................................... 16 E. Critical risks and possible controversial aspects ............................................................... 16 F. Loadcredit conditions and covenants ............................................................................... 18 I V. APPRAISAL SUMMARY .............................................................................................. 18 A . Economic and financial analyses ...................................................................................... -18 B. Technical ........................................................................................................................... 19 C . Fiduciary ............................................................................................................................ 19 D. Social ................................................................................................................................. 20 E. Environment ...................................................................................................................... 20 F. Safeguard poli.ci.es .............................................................................................................. 20 G. Policy Exceptions and Readiness ...................................................................................... 20 This document has a restricted distribution and may be used by recipients only in the performance o f their off icial duties. I t s contents may not be otherwise disclosed without Wor ld Bank authorization . Annex 1: Country and Sector or Program Background. ......................................................... 21 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies .................. 27 Annex 3: Results Framework and Monitoring. ........................................................................ 3 1 Annex 4: Detailed Project Description ...................................................................................... 36 Annex 5: Project Costs ................................................................................................................ 48 Annex 6: Implementation Arrangements. ................................................................................. 51 Annex 7: Financial Management and Disbursement Arrangements ..................................... 59 Annex 8: Procurement Arrangements. ...................................................................................... 66 Annex 9: Economic and Financial Analysis .............................................................................. 70 Annex 10: Safeguard Policy Issues ............................................................................................. 80 Annex 11: Project Preparation and Supervision ...................................................................... 81 Annex 12: Documents in the Project File .................................................................................. 83 Annex 13: Statement of Loans and Credits. .............................................................................. 85 Annex 14: Country at a Glance .................................................................................................. 86 Annex 15: Maps ........................................................................................................................... 88 iv GRENADA OECS (GD) SKILLS FOR INCLUSIVE GROWTH PROJECT APPRAISAL DOCUMENT LATIN AMERICA AND CARIBBEAN LCSHE Date: December 16, 2008 Team Leader: Angela Demas Country Director: Yvonne M. Tsikata Sectors: Vocational training (50%); Other Sector ManagedDirector: Chingboon Lee/ social services (25%); General public Evangeline Javier administration sector (25%) Themes: Improving labor markets (P);Social safety nets (P);Other social protection and risk management (P);Education for the knowledge economy (P) Project ID: PO95681 Environmental screening category: Not Required Lending Instrument: Adaptable Program Loan [ ]Loan [XI Credit [ 3 Grant [ 3 Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (USsm.): 3.00 Proposed terms: Standard IDA credit with Service Charge payable by the Recipient on the Withdrawn Credit Balance equal to three-fourths o f one percent (3/4 o f 1%) per annum. The maximum commitment charge rate payable by the Recipient on the unwithdrawn financing balance shall be one-half o f one Dercent (1/2 o f 1%) Der annum. Local Sources o f Borrowing Countrv 0.60 I 0.00 I 0.60 Total: 3.50 I 1.00 I 4.50 Borrower: Government o f Grenada Minister for Finance Hon. Nazim Burke Financial Complex The Carenage St. George’s, Grenada Tel: 1-473-440-6843 Responsible Agency: Ministry o f Education Minister for Education V Hon. Franka Alexis-Bemardine Botanical Gardens Tanteen, St. George’s Grenada Tel: 473-440-3 162 4nnual I 380.000 I 760.000 I 710.000 I 750.000 I 400.000 hmulat ive I 380,000 I 1,140,000 I 1,850,000 I 2,600,000 I 3,000,000 I Does the project depart from the CAS in content or other significant respects? Ref: PAD I.C. [ ]Yes [XINO d Does the project require any exceptions from Bank policies? Ref: PAD IKG. [ ]Yes [XINO Have these been approved by Bank management? [ ]Yes [ IN0 I s approval for any policy exception sought from the Board? [ ]Yes [XINO Does the project include any critical risks rated “substantial” or “high”? Ref: PAD IILE. [XIYes [ ] N o Does the project meet the Regional criteria for readiness for implementation? Ref: PAD I K G. [ X]Yes [ 3 N o Project development objective Re$ PAD II.C., Technical Annex 3 The objective o f t he second phase o f t he A P L i s to support Grenada to increase the employability o f youth through publidprivate sector partnerships for technical and l i f e sk i l ls training that i s demand driven. This objective will be pursued through three means: (a) training to increase job- related competencies among unemployed youth through the establishment o f a competitive training mechanism that supports the financing and delivery o f demand driven training; (b) establishing a framework to improve the quality and value o f training in Grenada and enhance OECS collaboration in training through the adoption o f an occupational standards framework that i s validated locally and recognized regionally; and (c) strengthening institutional capacity to plan, implement, and monitor training. The main results indicators are: (a) The percentage o f youth enrolled in the training scheme who are employed fifteen months after the start o f their training. Target value: 65 percent. (b) The number o f youth certified at Level Io r above. Target value: at least 800. Project description Ref: PAD II.D., Technical Annex 4 Component 1 - Skills training for unemployed youth, will finance the training o f unemployed youth through a competitive, demand-driven training scheme. The objectives o f the training scheme are to provide quality, competency-based sk i l ls and l i fe sk i l ls training to vulnerable youth, and to ensure that the training corresponds to labor market needs. Component 2 - Establishing an occupational standards framework to improve the quality and value of training, will finance activities related to the adoption o f a n occupational standards v i framework that i s regionally recognized and adapted to the local context. This will include the introduction o f occupational standards, their vetting by local industries, and the establishment o f quality assurance processes; and Component 3 - Institutional strengthening and project management through the following subcomponents: Subcomponent 3.1 : Institutional Strengthening will support the Grenada Council for Technical and Vocational Education and Training (GCTVET) and the associated National Training Agency (NTA) in their role o f establishing TVET policy and promoting the adoption o f a regional, standards-based occupational framework. Subcomponent 3.2: Project Management will support the implementing agency and Project Coordination Unit (PCU) to closely monitor and evaluate the implementation o f the project. Subcomponent 3.3: Communications Campaign will support a targeted communications campaign focusing on the three main stakeholders: youth, training providers, and employers. Which safeguard policies are triggered, if any? Ref; PAD I KF ., Technical Annex 10 N o Safeguard policies are triggered. Significant, non-standard conditions, if any, for: Ref; PAD III.F . Board presentation: N/A Credit effectiveness: There are two conditions o f e ffectiveness: (i)th at the NTA has been established in a matter satisfactory to the Association (legal establishment); and (ii)th at the Subsidiary Agreement that has been executed on behalf o f t he Recipient, GCTVET and NTA had become effective. Covenants applicable to project implementation: vi i I. STRATEGIC CONTEXT AND RATIONALE A. Country and sector issues 1. Economic growth is steadily improving in the countries of the Organization of Eastern Caribbean States (OECS), including Grenada. Previous local and external shocks triggered a decline in overall economic performance including lower growth rates, decreasing terms o f trade and increased rates o f unemployment, particularly among out-of-school and unskilled youth. A slow recovery started in 2003 but Grenada's gains were reversed in 2004 as the economy declined by 6.8 percent as a direct result o f Hurricane Ivan, which caused losses estimated at 200 percent o f GDP. Due mainly to post-hurricane construction, the economy grew by 11.03 percent in 2005. The growth rate for 2006 was negative 2.4 percent. The Eastern Caribbean Central Bank (ECCB) estimates that real GDP in Grenada increased by 3.5 per cent in 2007, and attributes this turnaround in economic activity to growth in most economic sectors, led by tourism and agriculture, as well as a rebound in the manufacturing and transport sectors (Annual Economic and Financial Review 2007, ECCB). 2. Recent economic growth in Grenada has relied heavily on the revival of the tourism sector following Hurricane Ivan. The ECCB estimates that value added in the hotel and restaurant sector which i s used as a measure o f tourism activity, expanded by 10 percent in 2007 following a post-Ivan recovery o f 50.6 percent in 2006. The performance in 2007 reflected continued growth in stay-over visitor arrivals. The expansion in tourism activities has led to increased demand for related services, such as electricity and water, transport, real estate and housing, communications, banking, and insurance. Construction activity boomed during post- hurricane reconstruction but predictably slowed down as major projects were finished. While the tourism sector has expanded in Grenada, in the Eastern Caribbean region as a whole, the number o f visitors has remained stagnant in recent years as the tourism market has become more competitive. Within this competitive environment, it i s crucial that the Grenada tourism industry concentrate on high-margin and niche markets, which wi l l in turn require specialized sk i l ls for hospitality and tourism industry workers. 3. To ensure economic growth, Grenada and other OECS countries must undertake crucial reforms, including improving provision of skills to the economy. According to the World Bank report, OECS Towards a New Agenda for Growth (2005), the OECS must address three crucial elements to maintain high economic growth in the medium run: (i)fo rmulation o f a long-term vision that positions the OECS Economic Union in the global economy; (ii)re orientation o f the basic development model toward greater openness, competition and a more level playing field in the sub-regional economy; and (iii)th e creation o f new capacity in the labor force and the private sector to take advantage o f emerging opportunities in the global market place. In Grenada, f i r m s cited shortage o f skilled labor as the number one constraint to increasing competitiveness. Therefore, enhancing the employability o f youth would help increase competitiveness o f the economy, especially in the expanding sectors. New economic opportunities are currently emerging in Grenada in tourism, construction, and the marine industries (yachting, etc.) with the start o f construction o f new major hotel/'resort properties and the establishment o f yacht repair facilities. In agriculture, the expansion o f the hotel and tourism sectors will increase the demand for locally grown produce. 1 4. Demand for skilled labor wi l l place significant pressure on the labor market in the next few years. A number o f new large projects are being planned and implemented and, when completed, wi l l require significant numbers o f trained staff. While existing companies in Grenada may not be planning to expand significantly in the near future, as confirmed in an employers needs assessment, they may experience the repercussions o f increased demand for trained staff, in that their best trained staff may move to f i l l the vacancies in the new developments. 5 . To be successful, the Caribbean Single Market and Economy (CSME), a strategy to position the region for competitive participation in the global economy, wi l l require increased movement of artisans and skilled persons across the Caribbean Community. In this context, the Caribbean region i s taking steps to provide the human capital foundation for economic growth and integration. On October 19, 2007, the Caribbean Community Secretariat (CARICOM), other regional educational institutions and Jamaica’s HEART Trust National Training Agency launched the Caribbean Vocational Qualifications (CVQ). The CVQ framework emphasizes common standards for and recognition o f technical and vocational qualifications throughout the region, and alignment o f technical and vocational training and education (TVET) with workplace demands. These qualifications will be accessible to persons already in the workforce as well as students in secondary and post secondary education. The Caribbean Association o f National Training Agencies (CANTA) focuses on the CVQ at the post-secondary level. B. Rationale for Bank involvement 6. The proposed project falls under Pillar One, “Supporting Growth and Competitiveness,” o f the OECS Country Assistance Strategy (CAS) for 2006-2009. The CAS highlights “growing unemployment, specifically among young people” as one o f the core challenges which must be addressed, offering support for both “stimulating growth and competitiveness” as well as “reducing vulnerabilities, particularly targeting at-risk youth” in the two pillars o f the CAS. The design o f this project i s based on the findings o f two AAA products: The Caribbean Social Protection Strategy (2005) and the OECS Ski l ls Enhancement Policy Note. Key findings and recommendations from the World Development Report: Development and the Next Generation 2007 that focuses on youth has also influenced project design and provided reinforcement for investing in young people. In addition, the project w i l l complement the ongoing OECS Education Development Project (APL) and the Caribbean Knowledge Learning Network project (CKLN) by better linking education to labor market demands and by offering assistance to youth who face difficulty in gaining a foot hold in the labor market. Finally, the project wi l l draw upon lessons learned Bank-wide, and create synergies with similar youth-centered school to work transition projects in the Dominican Republic, Chile, Colombia, and Honduras. d 7. The proposed project would use Bank resources to leverage more effective investment by Government, the private sector and other donors by: (i)p iloting and evaluating a new modality for demand-driven training through public-private sector partnerships; (ii)e nsuring that a framework for standards-based sk i l ls training and accreditation i s put in place; (iii)w orking closely with the other OECS client governments as well as with other donors and regional bodies during preparation and implementation; and (iv) strengthening labor market and training related institutions in Grenada. 2 C. Higher level objectives to which the project contributes 8. The project will contribute to several higher level objectives. First, by focusing on skills development in areas demanded by the private sector, the project will contribute to the competitiveness o f the Grenadian economy. Second, by focusing on youth, the project will address the wider challenge of youth unemployment, underemployment, and youth-related crime. Third, by supporting the adoption o f a regionally accepted competency-based standards framework for vocational education and training in Grenada, the project will contribute to the country’s capacity to provide quality training and certification at any level to i t s populace and facilitate the professional mobil i ty o f trained workers to neighboring countries as envisioned under the Caribbean Single Market and Economy (CSME). 11. PROJECT DESCRIPTION A. Lending instrument 9. The proposed project will be the second phase o f the OECS Ski l ls for Inclusive Growth Adaptable Program Loan (APL). In the “horizontal” APL, support for multiple operations (phases) i s provided for several countries under a common program framework. The te rm horizontal implies that the instrument will apply sequentially across interested and eligible OECS countries to allow governments to j o i n the program when they are ready and meet the eligibility criteria. The implementation period o f the operations likely will overlap. As discussed in Section 11, Part F - Alternatives Considered, the “horizontal” A P L i s preferable compared to several stand-alone specific investment loans (SIL). B. Program objective and Phases 10. As established with the f i rs t phase of the OECS (St~ Lucia) Skills for Inclusive Growth APL, the program objective is to support the development o f demand-driven training programs in the OECS. The advancement toward this objective will be measured by the number o f youth enrolling and successfully completing a demand-driven training program. 11. Program eligibility criteria. A country will become eligible to j o i n the program when i t meets three criteria for participation. (i)C ompletion o f a detailed project proposal to improve ski l ls training incorporating the following key principals: (a) training i s demand-driven and offered in partnership with the private sector; (b) training i s financed through a competitive scheme whereby training providers partnering with employers reply to a call for training course proposals; (c) training addresses issues o f e mployability and career mobil i ty o f t he workforce; (d) training i s short and focused; and (e) training combines technical and behavioral skil ls. (ii)G overnment commitment to participate in the following key regional activities: (a) adoption o f approved regional standards; and (b) recognition o f O ECS training providers accredited under the project, and (iii)Availability o f counterpart funding for the project. 12. All OECS territories (Anguilla, Antigua and Barbuda, Bri t ish Virgin Islands, Commonwealth o f Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines) could potentially participate in the program, even though they may not require or be eligible for IBRD/IDA financing. Participation could be financed entirely by the country, or partly financed by the World Bank and/or another donor. It is expected that World Bank financing will be l imited to a subset o f countries. The Country Assistance Strategy (CAS) lays out the framework for IBRD/IDA financing for the program. Four OECS countries have available IDA funding for the program (Commonwealth o f Dominica, Grenada, St. Lucia, and St. Vincent and the Grenadines). 13. The program wi l l be rolled out in an on-demand basis. St. Lucia was the f i rst country to j o in the program.' Grenada i s the second country participating in the program. The Government o f Grenada has met al l o f t he eligibility criteria as outlined above. Other OECS countries are also eligible to participate if they meet the established criteria. 14. Bank procedures for approval of subsequent operations of the APL. The Project Appraisal Document (PAD) for the f i rs t operation (St. Lucia IDA Credit No . 4300) describes the program objectives and the subsequent operation. The Grenada project i s the f i rs t subsequent operation. It i s consistent with the above-described program objective and complies with the established participation criteria. 15. Following the approved A P L procedures, the P A D for the subsequent operation will be circulated to the Board for information after approval in principle by Management (exercised by the Regional Vice President), and management approval will become effective 10 working days thereafter. An approved envelope o f US$6.5 mi l l ion was specified in the first APL, and the proposed Grenada credit i s within that total amount. The project would be scheduled for Board discussion only if requested by at least three Executive Directors during the 10-day review time period. C. Project development objective and key indicators 16. The objective o f the second phase o f the A P L i s to support Grenada to increase the employability o f youth through public/private sector partnerships for technical and l i f e sk i l ls training that i s demand driven. The project's main results indicators will be: (a) The percentage o f youth enrolled in the training scheme who are employed fi f teen months after the start o f t heir training. Target value: 65 percent. (b) The number o f youth certified at Level Io r above. Target value: at least 800. 17. This objective has three intermediate outcomes with associated lines o f a ction: IDA Credit No.4300 was approved on April 5,2007 by the Board of Directors o f the World Bank Group. 4 (a) (Training) to increase job-related competencies among unemployed youth through the establishment o f a competitive training mechanism that supports the financing and delivery o f demand driven training; (b) (Framework) to improve the quality and value o f training in Grenada and enhance OECS collaboration in training through the adoption o f an existing occupational standards framework that i s validated locally and recognized regionally; and (c) (Capacity building) to strengthen institutional capacity to plan, implement, and monitor training. 18. The main intermediate outcome/output indicators o f success for each o f these lines of action are: (a) (Training) Number o f youth successfully completing program training. Completing includes: successfully graduating from the technical and l i f e sk i l ls modules, and completing the traineeship in a private company. Target: 960 by end o f project. (b) (Framework and capacity building) Number o f CVQ certifications awarded in Grenada, including youth and non-youth. Target: 895 by end o f project. D. Project components 19. The design o f this project draws upon the design and early lessons learned in the f i rs t OECS operation under the APL in St. Lucia. Hence, the description o f the Grenada project i s similar to the description o f the St. Lucia project. The Grenada project will consist o f three interlinked components: Component 1 - Skills training for unemployed youth; Component 2 - Establishing an occupational standards framework to improve the quality and value o f training; and Component 3 - Institutional strengthening and project management 20. The components are closely linked in the sense that Component 1 wi l l support the delivery o f ski l ls training to unemployed youth by financing a competitive, demand-driven training scheme while Component 2 wi l l support policies and regulation that enhance the quality and value o f training delivered and the sustainability o f the training scheme financed under Component 1. Component 3 will finance the strengthening o f institutional capacity and project management to carry out the establishment o f the framework and provision o f quality training in a sustainable manner. A monitoring and evaluation system will contribute to evidence-based decision making and the agility to adapt to changing market needs. 21. The aim i s to keep the project design simple. Financing o f training (component one) wi l l be against training course proposals, based on per capita amount per trainee. One objective will be to incorporate a performance-based incentive for training providers to ensure quality delivery. A final percentage o f the payment would be contingent on the trainee’s completion o f the course and certification. 22. Regional Activities. While it i s important and advantageous for the countries participating in the APL to undertake activities at the regional level, the extent to which this can 5 be done wi l l depend on the pace o f integration o f the countries into the program. The Grenada project i s regional in nature. Under Component 1, training providers throughout the OECS wi l l be eligible to compete for the training o f Grenadian youth. Trainees who earn a certification in the skill for which they train, known as a Caribbean Vocational Qualification (CVQ), will have a portable skill that i s recognized in the wider Caribbean. Under Component 2, regional activities are expected to include: (i)th e development and provision o f occupational standards-related materials throughout the OECS; (ii)tr aining o f assessors that are qualified to certify trainees and others in the workforce; (iii)tr aining o f auditors for accreditation o f training providers based on regional standards; and (iv) collaboration o f regional experts in workshops on standards. Finally, regional activities under Component 3 include: (i)a tracer study and evaluation o f training interventions; (ii) procurement o f common management information systems; (iii) the establishment o f an OECS register o f qualifications; and (iv) implementation o f a common labor market needs assessment. Component 1- Skills training for unemployed youth (US$2,090,000) 23. This component wi l l finance the training o f approximately 1,200 unemployed youth through a competitive, demand-driven training scheme. The objectives o f the training scheme are to provide quality, competency-based and l i f e sk i l ls training to vulnerable youth, and to ensure that the training corresponds to labor market needs. Based on international best practice and specific experience through the St. Lucia project and prior sk i l ls training efforts in Grenada, six principles acquired through lessons learned are being employed to guide the design o f Grenada’s training scheme: (i)tr aining i s demand driven and offered in partnership with the private sector; (ii)t raining addresses issues o f employability and career mobility o f the workforce; (iii)tr aining combines behavioralAife sk i l ls and technical sk i l ls modules; (iv) training i s delivered in short and focused modules; (v) training includes a monitored apprenticeship in companies; and (vi) the training scheme seeks efficiency, quality and value o f training through regional collaboration, recognition and portability o f skil ls. 24. Training wi l l be targeted to unemployed youth ages 18-30 who are secondary school leavers (drop outs or graduates). They will have a maximum o f six months work experience or internship in the sector o f training for which they apply and no previous formal training in the sector. The trainee should have no more than three subject CXC2 passes and there i s no minimum number o f CXCs required (see Table 2, Annex 4). These criteria ensure that the target group comprises youth who do not have sufficient academic qualifications to obtain employment or proceed to higher education on their own and require additional sk i l ls training to make the transition from school to work. 25. Training will begin with the combination o f a short, l i f e sk i l ls and technical sk i l ls module that meets at least the minimum criteria for level one certification o f the CVQ (about 340 hours o f technical training). This wi l l be followed by a structured apprenticeship with a participating public/private employer that i s monitored by the training provider. Throughout the training scheme, certif ied assessors will be utilized to administer periodic competency assessments o f the CXC i s the Caribbean Examinations Council which administers common regional exams in various subject areas to upper secondary school students. Results are generally used for entrance to tertiary education and/or for seeking employment. Most tertiary level institutions and employers require at least four passed subjects for employment or entrance to higher education. 6 trainees. Upon completion o f the technical and apprenticeship process, trainees meeting the competencies for level one certification will earn a national vocational qualification certificate (NVQ). It i s intended that the project will begin offering training for entry level trainees in one or two sectors (most l ikely the hospitality and construction sectors according to the Employers’ Needs Assessment) during the f i rs t year of training. Once the implementing agency has gained experience and critical parts o f the framework supported under Component Two are in place, expansion to other sectors (horizontal) and levels (vertical) i s envisioned. 26. The training scheme will organize and finance training o f young unemployed individuals on a regular basis. Each “round” o f t raining entails the following steps: (i) outreach to, and enrollment of, trainees, training providers, and employers; (ii) a call for training course proposals in specific employment sectors; (iii)m atching eligible trainees, f i r m s and training providers; (iv) three to four months o f pre-service training, including a l i fe sk i l ls module and a technical sk i l ls module, using a standards-based curriculum; (v) four months apprenticeship with an employer/firm; (vi) assessment and certification o f t rainee’s sk i l ls by certif ied assessors; and (vii) monitoring and evaluation at each step o f t he process and after certification. 27. Trainee stipends and financing. The project will pay each trainee a modest stipend to provide minimum income support for the trainee to undertake the training and offset the costs of, for example, transportation and chi ld care in order to participate. During the l i f e sk i l ls and technical training coursework, the stipend will be EC$l5/day (equivalent to US$5.57/day) and during the apprenticeship the stipend per day increases slightly to EC$20/day (US$7.44/day) since many businesses are not located directly in St. Georges (an extra bus trip i s included). The stipend during the coursework and l i fe sk i l ls i s financed by the credit and the stipend during the apprenticeship i s financed by the employer. 28. Unit Cost for the Training Scheme. The unit cost per trainee i s US$1,658 (EC4,456) and has been estimated based on costs o f technical training provided in Grenada which vary widely depending on the institution. A variety o f institutions were consulted including the T.A. Marryshow Community College’s technical and vocational program and NEWLO’s intensive programs. During appraisal, an adjusted average was calculated for the final estimate o f the unit cost per trainee. The Grenada program provides 60 hours o f l i fe sk i l ls training, 340 hours o f technical ski l ls training (in line with the average for a Level One CVQ), and about three months o f an apprenticeship. Annex 4 provides more detail and Annex 5, Table 5.6 contains a breakdown o f the unit cost. 29. The estimated unit cost was also compared to the actual costs o f other vocational training programs in Latin America and the Caribbean (LAC) region. Other vocational training programs targeted to young people in L A C are estimated from a l o w o f US$691 for the PROJoven program in Peru to about US$1,5OO3. The St. Lucia Ski l ls for Inclusive Growth Project has a unit cost o f US$ I, 351 which includes the pre-service training and the apprenticeship. The costs in L A C are comparatively lower than OECD countries. Costs o f programs in OECD countries Shown in 2005 USD. 7 such as Canada, the UK and the United States range from US$950 for the New Deal for the Young Unemployed in the UK to US$17,151 for the U.S. Job Corps. Program costs vary depending on their duration, intensity, and purpose. For example, Grenada’s program has significantly more hours o f training in comparison to the Peru program which affects the unit cost per trainee. The training offered through this proposed Grenada project i s driven by the end-goal o f providing standards based training to enable certification at a skill level one. This requires a higher number o f h ours o f t raining as mentioned above. 30. Key criteria for private sector willingness to participate in both the training and the mandatory youth apprenticeship scheme was explored through focus groups with stakeholders. Feedback from focus groups and the Employers’ Needs Assessment showed that employers are willing to contribute when they are sure the investment will directly benefit them versus a contribution through a general levy for training. Grenadian businesses expressed a willingness to pay the cost o f the stipend to the trainee during the apprenticeship period which i s a customary practice. They may also be willing to contribute a small percentage to the technical classroom training, but reactions were mixed. It i s likely that positive results o f the training scheme will demonstrate returns that would persuade businesses to invest. 3 1. The project’s impact will depend critically upon i t s ability to attract unemployed youth, employers, and training providers. Through the assistance o f a PHRD grant during project preparation, these three groups o f stakeholders have been consulted by means o f focus groups, representative membership on the government’s preparation team, and ad-hoc meetings. Component 2: Establishing an occupational standards framework to improve the quality and value of training (US$440,000) 32. This component will finance activities related to the adoption o f an occupational standards framework that i s regionally recognized and adapted to the local context. This will include the introduction o f regional occupational standards, their vetting by local industries, and the establishment o f quality assurance processes. The latter will include: training a cadre o f assessors and inspectors, accreditation o f training providers, and certification o f trainees based on competencies. The component will support technical assistance provided by regional leaders for the training o f Grenada’s inspectors and assessors and fol low up technical assistance on a consultancy basis to provide coaching during execution o f assessments for certification o f trainees and accreditation o f training providers in order to continue building capacity in the country. It will also support the actual inspections for accreditation and assessments for certification. 33. This framework will not only serve the training financed by the project’s f i rst component, but it will also serve the wider national training system including TVET at the secondary school level. The process will involve OECS-wide collaboration, as several OECS countries are moving towards the introduction o f this type o f framework on a comparable time l ine and in accordance with CARICOM recommendations. Barbados and Trinidad have already adopted and introduced the regional occupational standards framework. St. Lucia and St. Kitts and Nevis are at the early stages. OECS-wide collaboration will allow countries to reap the benefits from economies o f scale and will help prepare them for the CSME. 8 Component 3: Institutional Strengthening and Project Management (US$1,950,000) 34. This component aims to strengthen institutional capacity o f the implementing agency to plan, implement, monitor training, and manage the project. 35. Subcomponent 3.1. Institutional Strengthening (USS450,OOO). This subcomponent will support the Grenada Council for Technical and Vocational Education and Training (GCTVET) and the associated National Training Agency (NTA) in their role o f establishing TVET policy and promoting the adoption o f a regional, standards-based occupational framework. The GCTVET was approved by Cabinet in July 2007, and the NTA i s currently being established. NTA would be a small operational arm o f the GCTVET. The mandate o f GCTVET i s to function as a decision making body, which determines the national policy for technical and vocational training. The GCTVET i s composed o f TVET officials at the Ministry o f Education and representatives o f the main stakeholders. The GCTVET directs the validation and ratification o f standards, allocates financial resources made available, ensures the quality o f the training and assessment processes, and monitors the performance o f training assistance. The NTA would consist o f a small core o f technical professionals who would coordinate technical inputs for standards validation, training provider accreditation, the calls for training proposals, and trainee registration and certification. It would call upon trained professionals to carry out assessments, inspections and certifications, and to serve on training proposal evaluation committees. This core staff would include professional counselors and may draw upon M O E guidance counselors to help select and guide potential trainees. The new Government i s taking steps to legally establish the NTA. Terms o f r eference for the key positions have been developed and the structure and responsibilities o f t he NTA are clearly defined (Annex 6).4 36. While the government o f Grenada has allocated a budget for both agencies, the project would help facilitate their mandates, structure, responsibilities, reporting, financing, and involvement throughout project implementation. The project will also facilitate the acquisition o f technical assistance from organizations such as the Caribbean Association for National Training Agencies (CANTA), the Jamaica HEART Trust, and the Trinidad and Tobago NCTVET. The benefits from these investments in GCTVET and NTA are expected to accrue both during and beyond the project’s l i fe span. The M O E has been identified as the agency responsible for implementation o f the project. The GCTVET and NTA are established semi-autonomously under the direction o f the Ministry o f Education. Since these structures are new, considerable capacity strengthening and technical support i s being supported under this subcomponent. 37. Subcomponent 3.2 Project Management and Monitoring and Evaluation (US$I,180,000), This subcomponent would support the NTA and the P C U to closely monitor and evaluate the implementation o f the project, including the development and maintenance o f a management information system (MIS). The funds under this subcomponent would go towards purchasing the requisite hardware and software, training o f staff and stakeholders, securing the necessary technical support, and collecting and analyzing information on trainees, employers, and training providers. The design and development o f the MIS would be essential for the The Ministry o f Education i s working toward legally establishing the NTA and filling the key positions as soon as possible. The Minister o f Education presented the structure o f the NTA for approval to the Cabinet on August 25, 2008. The hiring o f a Chief Executive Officer for the N T A i s a condition o f negotiations. 9 monitoring and evaluation activities, and the new system would be designed in a way to provide accessibility o f essential information to the multiple agencies requiring labor market analysis for evidence-based planning and decision-making. A Japanese Grant for project preparation i s currently supporting a consultant to design the monitoring and evaluation system. The project would support the programming and training in use and maintenance o f the system. 38. Several key aspects o f the project would be closely monitored and evaluation activities would be carried out to assess strengths and weaknesses with a view to making adjustments as needed for improvement. Among the aspects o f the project that would be closely monitored are: (a) adoption o f occupational standards in the sectors; (b) employers and training providers registered in the training scheme; (c) winning training proposals that are awarded contracts; (d) participating youth registered in training courses; (e) attendance o f trainees and payment o f transportation allowances; (f) completion o f technical competency units by trainees; and (g) trainees earning a CVQ. Among the planned evaluation activities are exit surveys for trainees, online satisfaction surveys for training providers and employers, employment tracking surveys for trainees, feedback from stakeholder focus groups, and related reports at various stages o f the project. 39. Subcomponent 3.3 Communications Campaign (US$320,000). This subcomponent would support a targeted communications campaign focusing on the three main stakeholders: youth, training providers, and employers. It would be instrumental in communicating information about the training scheme, call for proposals, and trainee registration under Component One and the dissemination o f information regarding the roll out o f the occupational standards framework for Component Two. E. Lessons learned and reflected in the project design 40. Training programs need to be an integral part of active labor market policies. The proposed OECS training scheme builds explicitly on the existing Government-funded training programs throughout the OECS. Experience, particularly from Europe, has shown that labor market insertion can be successfully improved, including for disadvantaged population groups, if intermediary services that efficiently link labor market demand with supply are provided. A key part o f this project i s to ensure that both trainees and employers are well-linked and to provide a bridge linking the two groups. 41. Working with the private sector requires flexibility and quick responses from the suppliers of training. In order to encourage the private sector to accept trainees, the program needs to be flexible and respond quickly to the opportunities offered by the market. The project, therefore, wi l l allow various modalities for submitting training proposals to the NTA, including direct match between the employer and the training provider, a training broker acting on behalf o f several small firms, or direct requests from f i rms . 42. Training cannot substitute for schooling. It i s known that a short-term training program cannot make up for the opportunities lost by youth who have either dropped out o f school, been held back, or who have had a poor education. Studies have shown that for many youth, a combination o f training and reentry to the education sector through “second chance” education programs have proven to be a successful combination in the long run. Firms polled in a recent 10 World Bank report on Lat in America and the Caribbean overwhelmingly chose to train skilled (secondary education or above) workers. Although higher levels o f education are associated with higher incidence o f training, the critical threshold seems to be completion o f secondary education. This most l ikely reflects the idea that investment in training requires a sufficient prior skill base in order to result in higher private returns. Overall f i r m s rarely invest in basic sk i l ls o f a worker, but rather train in specific job-related skil ls. Thus, to achieve full benefits from a sk i l l s training program for unemployed youth, it i s important to have broader access to secondary education and expand access to “second chance” education programs. For reasons explained below, this project only assists modestly in expanding “second chance education” programs. However, in other projects, the World Bank i s assisting four governments o f t he OECS providing universal access to better quality secondary education, with an emphasis on literacy, numeracy and strategies to support students with special learning needs (see Annex 2 Major Related Projects). 43. Life skills training is essential to succeed in the workplace and in life in general. As shown by emerging studies, l i f e skil ls, such as communication skills, learning-to-learn, networking, conflict resolution, team work, information on risky behaviors (including reproductive health, HIV/AIDS, etc.), are increasingly important in a knowledge-based economy. These sk i l ls enable disadvantaged youth to increase their employability. This project includes a l i f e sk i l ls module and counseling o f youth to strengthen their l i f e skil ls. At the same time the project will strengthen the mentoring o f t rainees during the apprenticeship phase. 44. Keep project design simple. There i s broad recognition that the Bank’s technical expertise in project design has made a significant contribution to the sub-region’s development. However, project implementation in the OECS has not always gone smoothly and a number o f areas were cited as contributing to the lackluster implementation o f some projects in the OECS. A key area i s complex project design, which has led to delays in effectiveness and implementation. Therefore, this project design i s kept relatively simple. As explained below, the scope o f the operation was l imited to private sector-driven skills training. This strategic focus implied that the project does not add on extra programs that have sometimes brought additional challenges and complications, such as expansion o f second chance education programs and training o f already employed workers. 45. Incentives for training providers to provide quality training. Trainers will be required to offer standards-based training, and they should be paid based on outcomes. Tying the payments to various outcomes throughout the training cycle provides a good incentive for trainers to provide good quality training to ensure they meet the outcomes for which their payment i s based. They will receive the unit cost per trainee, minus the amount o f the stipend (which i s given to the trainee). Forty percent will be paid upon commencement o f training and 30 percent upon completion o f the technical classroom training. The final 30 percent will be disbursed only for those trainees who successfully complete the full training including the apprenticeship and obtain certification. This payment schedule provides a strong incentive for training providers to offer quality training that ensures their trainees learn and become certified. 46. Training must be aligned with the needs of the private sector. Trainees will have better chances at finding a j o b at the completion o f their training if they were trained to fill a position that i s in demand by the private sector. However, it i s often difficult for government entities to 11 determine exactly which positions are in demand. Therefore, the project incorporates direct participation o f the private sector in the determination o f which courses will be offered. First, each training proposal must be endorsed by private sector companies in the form o f commitments to take on trainees in an apprenticeship. Second, the private sector will be represented on the committee that will select the winning training proposals. 47. A good way to ensure that courses are effectively demand-driven is to require that the private sector share aportion of the costs of training. A recent report on impact evaluations o f j o b training programs financed by the InterAmerican Development Bank (IDB) revealed that the most common mechanism for ensuring support f rom the private sector, a simple “letter o f intent” from an employer offering to host interns who are provided free o f charge by the program, has repeatedly been shown to be insufficient. Instead, programs perform better when the private sector share some costs. For example, in Mexico, under the on-the-job training modality (by which training i s provided by the f i r m s and not by the training institutions) firms cover the direct costs o f training, while the program covers the stipends to participants. In Peru, f i r m s pay a minimum wage to participants during the internship phase. Under the proposed project the firms will cover the stipends to participants during the internship phase. In future years it i s proposed that f i r m s will also contribute 5-109’0 o f the unit cost per trainee for the technical classroom training. 48. Outreach and communication. A very important aspect o f the project i s communication with youth, employers and training providers, in order to attract participants to the program. I t i s necessary to set up specific communication tools to reach disadvantaged youth, especially boys. The project incorporates a consultancy to design a communications strategy. 49. Timing of the training courses for youth. Experience from similar projects in Honduras and the Dominican Republic, as wel l as experience from the Grenada Training and Employment Project (GTEP) project in Grenada, show that courses should start soon after registration o f eligible youth in order to retain their interest and availability to participate. Longer than four to six weeks, tends to pose some risk o f losing those who have registered and been selected. To make this possible, it i s necessary that: (i)th e registration process be streamlined and wel l planned; (ii)v erification o f e ligibility and counseling o f youth need to start as soon as youth start applying to the program; and (iii)y outh will be informed at the time o f a pplication o f the courses that will be available. 50. Strengthening implementation capacity. Adequate preparation of the project. The St. Lucia project demonstrated that the process o f acquiring, validating and disseminating standards is time-consuming, and that, if started after approval o f the project, it could significantly delay the implementation o f the project. In Grenada, Bank technical assistance and preparation funds from the PHRD grant have enabled the Government to begin the process o f acquiring and locally validating the occupational standards for the Grenada context. I t i s expected that by Board date, the standards required for the first phase o f the project will have been acquired and fully validated by industry, and that they will be available for training providers. 5 1. Importance of the Monitoring and Evaluation System. Experience from the Honduras training component o f the Nutri t ion and Social Protection project shows that it i s essential to have a sound monitoring and evaluation system in order to be able to manage the project and 12 reach the targeted beneficiaries. The design o f such a system should happen during preparation, so that it i s ready by the time the first call for proposals is launched. F. Alternatives considered and reasons for rejection 52. Scope ofoperation. During design o f the project, there was extensive debate on whether to include a wider range o f beneficiaries, such as unemployed persons over age 30, employed persons seeking training, or persons seeking certification o f skil ls. Despite the importance o f reducing vulnerabilities and increasing the efficacy o f social safety nets in the OECS, the decision was taken to concentrate the training component on unemployed youth. Nevertheless, other persons wil l be able to benefit from adoption o f t he standards-based framework for training and assessment. While the project will not finance the direct cost o f certifying persons who acquired skills outside the training component o f the project, it wil l put in place a system o f certification within which anyone could be certified. The direct costs o f this certification would have to be borne through government financing or private sources. 53. Supply-side versus demand-side training. The team weighed the possibility o f funding a supply-driven training project or increasing direct financing to training institutions. However, analytical work on training clearly indicates that the most effective training i s demand driven training which involves public-private partnerships and critically l i n k s training provision to fulfilling identified private sector needs. Further, it has been documented that supply-driven training often does not match the needs in the market. To encourage sustainability and to build local training capacity, it has been decided to set up the training scheme in a market structure where multiple providers can submit bids under the training guidelines and both public and private institutions can participate in the training. 54. National versus regional project. There were several choices considered for implementation including the choice to have a regional OECS-wide project or a national project. At present, training i s very much a national undertaking, which implies that the countries do not reap many benefits o f economies o f scale. In order to have world class training that will provide the needed skills, it i s crucial to build a regional market for training. This will professionalize training in the region, improve quality o f training, provide volume, drive down costs, and save scarce fiscal resources. Balancing between the gains from a regional approach to training and the constraints o f national government in pooling resources, it was decided that the project would choose a middle path between a 100 percent regional approach including al l territories and a series o f national projects designed for each country. The program proposes similar national training projects with the same set o f operating principles and procedures, including mutual recognition o f training providers and certifications, while separating each country’s finances. Therefore, the program i s flexible in responding to each country in terms o f timing and economic priorities, while fostering regional collaboration where the gains are largest. 55. Choice ofBank instrument. The project i s a “horizontal APL” where several countries can access funding under the same framework established for the f i rs t operation. Two alternatives to this instrument were discussed. The first alternative is a “vertical APL” that provides financing for multiple operations (and loans) over time to each country. This could allow for either a design o f a long term investment plan stretching six to 10 years or a “customized” lending instrument with smaller loans in order to reduce commitment charges. 13 However, this was decided against due to the lack o f such a customized instrument and the government’s desire for swift project preparation. The second alternative was a series o f single country specific investment loans (SIL). The S I L was rejected since the chosen instrument, the horizontal APL, allows for: (i)c reating a common framework for competitive and private-sector driven training in the OECS conducive to increasing regional collaboration within this area, (ii) establishing a common framework for Bank financing o f training across the OECS, and (iii) simplifying the approval process for subsequent operations. 111. IMPLEMENTATION A. Partnership arrangements 56. The government and the Bank teams have actively engaged all main stakeholders (training providers, employers, youth) during the preparation of the project. The following entities were involved in preparation o f the project and will be involved in i t s implementation: 0 The Ministries o f Education; Youth; and Economic Development 0 Regional organizations (Jamaica HEART Trust/NTA, CANTA) Private sector (Grenada Tourism Association, Caribbean Tourism Organization, Caribbean Hotel Association, Grenada Employers Federation, the Grenada Chamber o f Commerce, and several individual f i r m s including large developers.) Training providers (T.A. Marryshow Community College, NEWLO, etc.) 0 Youth representatives B. Institutional and implementation arrangements 57. The Government o f Grenada has determined that the institutional Technical and Vocational Education and Training (TVET) infrastructure would include: (i) The Grenada Council for Technical and Vocational Education and Training (GCTVET), which fwnctions as an advisory body to the Minister o f Education with regard to policies, strategies, and programs for the management o f TVET. Where appropriate, the GCTVET shall have executive authority to decide and direct with regard to overall TVET strategy and specific programs and projects. (ii)A National Training Agency (NTA), consisting o f technical professionals, which would be responsible for, among other things, general co-ordination, planning, supervision, standard setting and validation, training provider accreditation, programme accreditation and trainee certification, and quality assurance. (iii)L ead Industry Bodies (advisory committees) that take the lead on the adaptation/ vetting o f the occupational standards for each industry under guidance o f the GCTVET. 58. The Grenada Council for Technical and Vocational Education and Training (GCTVET) was established in July 2007 and has been functioning for one year. During this time funding from the Japanese Grant has allowed for training delivered by Jamaica HEART Trust to the GCTVET, Ministry o f Education technical staff, and Lead Industry Bodies. The GCTVET 14 established Lead Industry Bodies for active sectors where demand i s high as confirmed by the Employers’ Needs Assessment 2008 (hospitality, construction, marine, agriculture). 59. The National Training Agency wi l l carry out the day-to-day management and administration o f technical and vocational education in Grenada at all levels o f education. The structure and positions have been defined and TORS developed during preparation o f the project. Personnel in the Ministry o f Education and the country possess the sk i l ls mix to fulfill those positions. Component 3 o f the project specifically supports the capacity building and strengthening o f the GCTVET and NTA. 60. The NTA wi l l manage the pre-qualification o f Training Providers, the Call for Proposals, the youth application process, matching o f trainees with selected courses, and the monitoring and evaluation. The N T A wi l l be small and draw upon technical experts in the Ministry o f Education and outside on an as needed basis. The institutional and implementation arrangements are described in detail in Annex 65. 61. The PCU wi l l work closely with the MOE as the implementing agency and in particular with the NTA. The PCU will provide guidance on compliance with fiduciary procedures and handle the procuring o f goods and services for the NTA as it relates to the project. The NTA will inform the PCU o f the winning course proposals from training providers and provide information on the selected trainees so that the PCU can respectively carry out the contractdagreements and process payments o f the transportation allowances to trainees. The PCU wi l l handle all financial transactions as it relates to the project. C. Monitoring and evaluation of outcomeshesults 62. The monitoring and evaluation o f the outcomes o f the project wi l l be the primary responsibility o f the Ministry o f Education through the National Training Agency and the PCU. The management information system, to be built under the project, w i l l include the following key elements: (a) Procedures and tools for registration o f youth in the training scheme, (b) Procedures and tools for participation o f private f i r m s in the training scheme, (c) Procedures and tools for the participation o f training providers in the training scheme, (d) Procedures and tools for the monitoring and evaluation o f courses and their participants (youth, training providers and employers), (e) Procedures and tools for the follow up o f youth registrants 15 months after the start o f the training, and (f) Procedures and tools for monitoring the adoption o f standards, certification o f providers and certification o f trainees and general public, including National Certification Database. 63. A PHRD Grant has enabled Grenada to move forward with a consultancy to begin designing the monitoring and evaluation system in advance o f project implementation. The Project Preparation Consultant i s also assisting the MOE and PCU to draft the Operational Manual where roles and responsibilities wil l be detailed. A first draft i s expected before the appraisal mission (August 3 1, 2008). 15 D. Sustainability 64. The adoption o f the standards framework and institutional capacity building developed under the project will enable Government to expand horizontally to other sectors and vertically to higher levels o f training and certification during and beyond the l i f e o f the program. The systems provide the foundation for Government to keep improving and using the framework. Grenada has recognized the need to include youth in training and employment opportunities. The Ski l ls for Inclusive Growth Program assists the Government to improve the quality and framework for training as well as to train young people. It builds on the Government’s prior established efforts for delivery o f youth training and as such the vision i s for youth training funds to be channeled through the training scheme that will continue after the project i s completed. 65. The project will enable Grenada to adopt and implement the regionally accepted CVQs. Since the framework i s being used regionally, there i s a greater probability that the Government will continue to use and improve the system in order to be able to benefit f rom the regional payoffs o f t he framework. 66. Through project design the Government will ensure that courses are effectively demand driven by sharing some o f the costs with the private sector. The share o f the cost o f training borne by employers could be increased over time if the training i s successful, allowing Government to continue operating the training framework established by the project and continue partnering with the private sector. E. Critical risks and possible controversial aspects Description of risk Mitigation measures Risk + Elections were held on July 8, + The new Government has confirmed i t s 2008 and a new Party (NDC) commitment to the proposed project. The M has come into power. Change o f World Bank will maintain dialogue and political priorities i s a concern. ongoing efforts to ensure that the new Government receives information on projects. 7 Technical and Vocational + The Project will assist in building the policy M Education Training (TVET) framework and institutional capacity for Policy and institutional capacity training based on occupational standards. to carry it out i s at the nascent + The Project will build an M&E system that stage. will provide information related to labor force + The data collection system on statistics for utilization across Ministr ies and by labor force statistics i s poor. stakeholders. There i s weak capacity for evidence based decision making Operation-specific Risks ~ ~ ~~ + Literacy and numeracy levels + Applicants with insufficient literacy and M o f t rainees are insufficient as a numeracy skills will be referred to the 16 Description of risk Mitigation measures Risk base for sk i l ls training Government’s “Yes IC an” second chance adult education program. + Employers are seeking higher + The project wi l l include vertical expansion for levels ski l ls than entry level training provision to Level 2. The framework (Level one certification). wi l l be in place for the Government to continue to higher levels o f training and certification. + Excluding young employed + Through the framework, project design will people who are not certified and allow for sk i l ls certification o f both who do not have much potential unemployed and employed persons. for growth + Low-interest from males in the + The project will conduct strong outreach target age group. activities targeting motivated and job-seeking youth. A specific communication outreach strategy for males in the population will be designed. + Lack o f quality training + The competition for training providers wi l l be providers in Grenada and weak open to Grenadian and regional OECS training knowledge o f competency-based providers. training + The project wi l l introduce occupational standards, certification and quality assurance measures that are nationally and regionally recognized. + Orientation and training in proposal writing wi l l be offered to training providers and employers to build knowledge and capacity. + The project wi l l implement performance-based funding o f training providers. + Employers seek different sk i l ls + Training courses will be funded on a than the ones provided in competitive, demand driven basis and training training courses - mismatch providers must show a proof o f partnership between demand and supply with employers. + During the preparation period, consultation + Employers do not wish to with employers has confirmed their willingness contribute to contribute financing for training that i s relevant to their needs. The GCTVET and the National + The project specifically supports training and Training Agency (NTA) are new capacity building for GCTVET and the NTA. and inexperienced. + Persons with the skill background to fill the N T A positions are available in Grenada; in addition, MOE personnel with the appropriate S sk i l ls can be seconded to these positions as necessary. + Sustainability o f financing for + The Bank wi l l ensure that courses are effectively demand driven by sharing some o f 17 Description of risk Mitigation measures I Risk training the costs with the private sector. + Fiduciary Risk - Financial + The PCU has already established a well Management Arrangements functioning financial management system meeting the World Bank fiduciary requirements. + The PCU, established as part o f t he Ministry M o f Finance will be responsible for a l l fiduciary responsibilities including procurement, financial management, project reporting and disbursements o f funds. + Lack o f proper facilities and + The extension o f t he Emergency Disaster training equipment in the Relief Project includes funds for TVET country. equipment for secondary schools. Overall Risk I F. Credit conditions and covenants 67. The following are the conditions for effectiveness: (i)th at the NTA has been established in a matter satisfactory to the Association (legal establishment); and (ii)th at the Subsidiary Agreement that has been executed on behalf o f the Recipient, GCTVET and NTA had become effective. IV. APPRAISAL SUMMARY A. Economic and financial analyses 68. The youth training is expected to affect youth employment on two dimensions: the probability o f employment and wages for employed youth. The economic analysis presented in Annex 9 computes the combinations o f employment probability and wage increases that wil l lead to positive returns for the project and evaluates the Grenada project from the economic return point o f view. The assumptions underlying the economic analysis are summarized in Table A-9.1 in Annex 9. 69. Rate of return of the project. Various scenarios o f employment and wage impact were used to compute, under the assumptions made, the Net Present Value and Rate o f Return o f Project investments. An increase in average wage income o f 20 percent i s needed to ensure a positive rate o f return with discount rates o f five or 7.5 percent, while an increase in average wage income o f 25 percent i s needed to ensure a positive rate o f return with discount rates o f 10 percent. Combinations o f changes in the employment rate and changes in wages that will lead to 18 at least 20 (25) percent increase in average wage rates are highlighted (resp. bolded) in Table A- 9.3 in Annex 9. 70. Summary of impacts of other j ob trainingprograms. The general conclusion presented in the reviewed studies i s that youth training programs in developed countries had the poorest track record, when compared with training programs for the long-term unemployed and those displaced through mass layoffs. Social rates o f return were typically negative, both in the short- and the long run. However, results from youth training programs appeared to be different in the case o f the “Jovenes” programs in Latin America (Argentina, Chile, Peru and Uruguay). O f the five new evaluations o f youth training programs in Latin America between 1999 and 2004, al l showed positive employment impacts and two o f the three computing earning effects demonstrated positive impacts on that indicator, The lessons learned from these projects are also summarized in the main text and included in the project design. 7 1. Assessment. With interventions that were similar to the planned intervention in Grenada, two out o f the five projects (Peru, Chile) achieved results which, if attained in Grenada, would yield positive rates to the Grenada project. I f the St. Lucia project impact were similar to those in the Argentina project, the rate o f return to investment would be positive only for adult females, but not for the other groups o f beneficiaries. Were the results o f the Grenada project similar to those in the Dominican Republic and Brazil project, the rate o f return would be respectively borderline negative and negative. Importantly, the economic analysis does not take into account the positive externalities o f t he project, such as higher propensity to engage in further education, improved services to the poor, reduction in future social protection spending, improved health, and reduced crime and violence. B. Technical 72. The project is deemed technically sound and innovative. The main lessons learned from technical and vocational education and training in the Latin America and Caribbean region and OECD countries have been taken into account when designing the project. The project designed was influenced by recent experiences and evaluation o f a private sector driven training system in the United Kingdom and in Latin America. In addition, the design incorporates training experiences from Jamaica and other Caribbean countries. The second component i s aligned with the training policies agreed and implemented at the wider Caribbean level in the sense that occupational standards and accreditation activities under the project will be consistent with the standards adopted by CARICOM and promoted by the Caribbean Association o f National Training Agencies (CANTA). C. Fiduciary 73. Fiduciary responsibility will be assumed by the centralized Project Coordinating Unit in the Ministry o f Finance. This unit has substantial experience with World Bank fiduciary guidelines and i s currently managing four World Bank projects. In addition, i t has participated in several Bank training sessions and workshops. The PCU is in the process o f being strengthened with additional personnel that will increase i t s capacity to handle the workload o f an additional project in a timely manner. Details o f the proposed financial management arrangements can be found in Annex 7. 19 D. Social 74. Focus groups with unemployed youth have shown strong interest in receiving training and in particular in occupations that are o f high relevance to the labor market. The target group also supported a mandatory traineeship. Consultations with employers also revealed the high value placed on l i f e sk i l ls and readiness to work even more so than technical skil ls. The inclusion o f a l i fe sk i l ls module and the apprenticeship features o f the proposed training model were highly commended and supported by employers. 75. Social indicators for the OECS countries are strong and almost all o f the major Millennium Development Goals have been met. Primary education net enrollment ratios, for example, are high, between 84 and 100, and infant mortality rates are low, ranging from 14 to 22 per 1,000. Dramatic progress in access to improved water source and sanitation has also taken place over the last ten years. L i f e expectancy, which ranges from 71 to 77 years, i s comparable to most OECD countries. E. Environment 76. The project has an environmental category C rating. I t i s expected to be neutral on the environment or marginally positive through an increased awareness for the importance of the environment through a greater level o f education and training o f the workforce in the OECS countries. F. Safeguard policies Safeguard Policies Triggered by the Project Yes N o Environmental Assessment (OP/BP 4.0 1) [I X Natural Habitats (OP/BP 4.04) [I X Pest Management (OP 4.09) [I X Physical Cultural Resources (OP/BP 4.1 1) [I X Involuntary Resettlement (OP/BP 4.12) [I X Indigenous Peoples (OP/BP 4.10) [I X Forests (OP/BP 4.36) [I X Safety o f Dams (OP/BP 4.37) [I X Projects in Disputed Areas (OP/BP 7.60)* [I X Projects on International Waterways (OP/BP 7.50) [I X G. Policy Exceptions and Readiness 77. No exceptions are sought. * By supporting the proposedproject, the Bank does not intend to prejudice the f inal determination of the parties’ claims on the disputed areas 20 Annex 1: Country and Sector or Program Background GRENADA: OECS (GD) Skills for Inclusive Growth 78. Economic growth is steadily improving in the countries of the Organization of Eastern Caribbean States (OECS), including Grenada. In the latter half o f the 1 9 9 0 ’ ~in~ s pite o f negative developments such as the loss o f preferential access to European markets for traditional export crops, Grenada made significant economic progress, achieving an average growth rate o f 5 percent per annum. However, local and external shocks at the turn o f the century triggered a decline in overall economic performance including lower growth rates, decreasing terms o f trade and increased rates o f unemployment, particularly among out-of-school and unskilled youth. A slow recovery started in 2003 but the gains were reversed in 2004 as the economy declined by 6.8 percent as a direct result o f Hurricane Ivan, which caused losses estimated at 200 percent o f GDP. Due mainly to post-hurricane construction, the economy grew by 11.03 percent in 2005. The growth rate for 2006 was negative 2.4 percent. The Eastern Caribbean Central Bank (ECCB) estimates that real GDP in Grenada increased by 3.5 per cent in 2007, and attributes this turnaround in economic activity to growth in most economic sectors, led by tourism and agriculture, as well as a rebound in the manufacturing and transport sectors. 79. Recent economic growth in Grenada has relied heavily on the tourism sector. The ECCB estimates that value added in the hotels and restaurants sector, a measure o f tourism activity, expanded by 10 percent following a recovery o f 50.6 percent in 2006 when most o f the hotel properties damaged during Hurricane Ivan were reopened. The performance in 2007 reflected continued growth in stay-over visitor arrivals. The number o f stay-over visitors grew by 10.9 percent to 13 1,580, associated with increased marketing and promotion, the reopening o f a hotel in Grand Anse and additional flights out o f Europe and the US. Hotel occupancy was reported to have been high relative to 2006, largely attributable to the hosting o f the Cricket World Cup 2007 and various regional and international conferences. O f the major markets, arrivals from the UK rose by 37.2 percent, as a result o f additional airlift and an appreciation o f the pound sterling relative to the U S dollar (to which the EC dollar i s pegged). 80. The expansion in tourism activities has led to increased demand for related services. For example, in 2007 the ECCB observed expansions in the main sectors including electricity and water (10 percent), transport (9.6 percent), real estate and housing (6.5 percent), communications (6.0 percent) and banks and insurance (5.5 percent). Construction activity decreased by 5.0 percent in 2007, from the 30.1 percent decline in 2006, as major post-hurricane reconstruction projects came to a completion. The construction sector’s share o f GDP fel l by 0.9 percentage point to 10.5 percent. 8 1. While the tourism sector has expanded in Grenada, in the Eastern Caribbean region as a whole, the number of visitors has remained stagnant in recent years as the tourism market has become more competitive. Within this competitive environment, it i s crucial that the Grenada tourism industry concentrate on high-margin and niche markets, which wi l l in turn require specialized sk i l ls for hospitality and tourism industry workers. Source : ECCB Annual Economic Report 2007 21 82. Reasons for this stagnation include intense competition among holiday destinations and the new passport requirements for Americans traveling to the Caribbean. The increase in airfare rates due to the r ise price o f o i l i s l ikely to further dampen the number o f t ourist arrivals. Within this competitive context, it i s crucial that the Grenada tourism industry concentrate on high- margin and niche markets, which will in turn require specialized sk i l ls for tourism industry workers. Source: ECCB, Annual Economic and Financial Report 2007 83. To ensure economic growth, Grenada and other OECS countries must undertake crucial reforms, including improving provision of skills to the economy. According to the World Bank report, OECS Towards a N e w Agenda for Growth (2005), the OECS must address three crucial elements to maintain high economic growth in the medium run: (i)fo rmulation o f a long-term vision that positions the OECS Economic Union in the global economy; (ii)re orientation o f the basic development model toward greater openness, competition and a more level playing field in the sub-regional economy; and (iii)th e creation o f n ew capacity in the labor force and the private sector to take advantage o f emerging opportunities in the global market place. In Grenada, firms cited shortage o f skilled labor as the number one constraint to increasing competitiveness. Therefore, enhancing the employability o f youth would help increase competitiveness o f the economy, especially in the expanding sectors. N e w opportunities are currently emerging in Grenada in tourism, construction, and the marine industries (yachting, etc.) with the start o f construction o f major new hotelhesort properties and the establishment o f y acht repair facilities. In agriculture, the expansion o f t he hotel and tourism sectors will increase the demand for locally grown produce. 84. The present trade agreements and negotiations in recent years continue to present new and increasing challenges for the Technical and Vocational Education and Training (TVET) system in Grenada. In addition, the free movement o f capital and people within the Caribbean economy under the CARICOM Single Market and Economy (CSME) will lead to increasing economic returns for persons whose skills are up-to-date, adaptable and recognized outside their home country. In order to address the issue o f portability o f skills, several OECS countries are working on introducing a National Vocational Qualifications (NVQ) framework that i s based on 22 regionally accepted occupational standards. To potential employers, NVQs are meant to confirm an individual’s technical skill level an competency, regardless o f the method o f acquiring the skill. 85. An employers’ needs assessment carried out during project preparation confirmed that a number o f large resort development projects are being planned and implemented and when completed, will require significant numbers o f trained staff. I t also revealed that existing companies in Grenada are not planning to expand significantly in the near future. However, existing companies, especially in the tourism sector, may experience the repercussions o f increased demand for trained staff. Their best trained staff may move to f i l l the vacancies in the new developments and thus, they too will have a need to f i l l vacancies with skilled employees. Table 1.1: Timeline of Activities at New Developments and Projected Demand for Staff Name of Project 2008 2003 2010 2011 Grand Harbour Construction Hospitality Hospitality Hospitality Phase I 162 rooms 162 -rooms 1 162 rooms 486 staff 486 staff 486 staff Bacolet Bay Construction Hospitality Hospitality Hospitality 325 rooms 235 units1325 235 units1325 235 units1325 505 workers rooms rooms rooms 350 staff 350 staff 350 staff Port Louis Marina Construction Construction Construction Hospitality and hotel 350 workers 350 workers 100 workers 250rooms Hospitality 400 staff 100 rooms 200 staff Cinnamon hill Construction Construction Construction Hospitality 5 star 350 workers 350 workers 350 workers 180 rooms 350 staff Cinnamon 88 I 4 Infrastructure Construction Construction Hospitality Seasons 800 workers Levera Project Infrastructure (6 Construction Construct ion miles o f road with 160-200 rooms 160-200 rooms water, electricity, Est. 300 workers Est. 300 workers telephone and cable) Total 1205 1500 1550 300 construction Workers (needed per yr) Total hospitality 0 836 1036 3086 staff 86. These new economic opportunities provide Grenada and the OECS with an opportunity to broaden the gains of growth to youth. Across the globe, youth unemployment i s 2-3 times 23 larger than adult unemployment, and Grenada i s no exception. The unemployment rate for the age group 15-19 years was shown at 42 percent (and 26 percent among 20-24 years old) compared to 15 percent for the whole workforce, according to the latest labor force survey. Youth unemployment imposes a high risk to society v ia forgone earnings and increased risks o f deviant behavior. The Caribbean Youth Report estimates that bringing youth unemployment to the level o f the whole workforce would increase GDP by 1.3 percent. The government has a window o f opportunity to increase youth employment through assistance in successfully transitioning from school to work through training and job-search activities. 87. Better preparation of young people through more relevant education and training would increase employment outcomes for youth. In 2004, 41 percent o f Grenadian businesses cited shortage o f skilled labor as a major or severe obstacle to increasing their competitiveness. It i s worth noting that much o f the increased demand for skilled labor in the construction industry during the post-hurricane reconstruction effort was met through the recruitment o f workers from regional countries not because o f the lack o f a sufficient number o f Grenadians, but because the required skills, even basics skills, were not available locally. Figure 1: Lack of Skills i s considered the biggest obstacle for Grenadian firms (What obstacles are important for your competitiveness?) Anti-conipeti'ive practices M o cruecmonuc ins ta bilitlJ Trcrl-6 Portatbi- intern ati ond Econornlc 8 reg policy uncertainty Crime. theft clnd disorder Access to financing Cost (of fina nci rig Skiiis atid eclu of 3va la l~ lew orkers 0 5 18 '15 2 0 25 30 35 3 0 45 0 fblajor obstacle H Swvero abstgcle Source: Grenada Investment Climate Assessment 2004 88. Education is a key factor for a successful career in the OECS. However, schooling seems insufficiently focused o n sk i l ls relevant to the labor market and overly oriented towards an academic career. There i s a need to better link the education system with labor demand. Improving curricula and teaching in secondary and tertiary education institutions to better reflect labor market demands i s the long term solution, and the World Bank i s currently financing the Grenada OECS Education Development Program (P077759) which aims to improve the quality, efficiency and relevance o f Secondary Education. Achieving this objective will take time, and i t 24 i s unlikely to eliminate the difficulties in the transition from school to work in the short term. Therefore, there i s an immediate need for specific sk i l ls training targeted to young people to actively assist them in gaining a f i rs t j ob experience, and to help current workers upgrade and certify their skil ls. This would reduce the share o f youth engaging in deviant behavior and expand the pool o f skilled workers. 89. Providing training through quality programs closely tied to employer needs would increase the impact of and the incentives for training. Governments in the OECS invest a modest amount in technical skills training, mostly through public training programs. For example in Grenada, the Ministry o f Youth’s IMANI program offers on-the-job training to young persons between the ages o f 18-30 who are no longer in learning institutions and are unemployed. However, many employers criticize the program as being o f low relevance. Training youth according to standards valued by employers would provide youth with an added incentive for training. Employers would be more motivated to participate in training schemes if they perceived that youth are trained in sk i l ls that are relevant to the working world. Hence, the challenge i s to design an effective training program that will benefit youth through upgrading o f their sk i l ls and the private sector through the provision o f sk i l ls that are relevant and contribute to companies’ productivity. 90. OECS countries wi l l reap substantial benefits by collaborating in the establishment and administration of their youth training programs. The proposed Grenada project would be the second youth training project supported through an Adaptable Program Loan (APL), fol lowing the OECS (St. Lucia) Skills for Inclusive Growth Projecte7T here are several reasons why OECS countries would gain from collaboration in this area: (i)O ECS countries face a common problem o f high youth unemployment and can learn f rom each other in tackling this complex issue; (ii) interlinked projects would create a market for training providers operating under a jo int set o f rules, which would yield economies o f scale and drive down the cost o f training; (iii)c ountries would spend less time on project preparation by developing and using common project concepts and tools; and (iv) the introduction o f the Caribbean Single Market and Economy (CSME) implies that the region increasingly relies on one shared labor pool. Common frameworks for certification o f technical sk i l ls will ensure that certificates are portable, enhance job opportunities and the efficiency o f l abor allocation. 9 1. As demonstrated by the Eastern Caribbean Telecommunications Project, which leveraged sub-regional economies o f scale within telecommunication, it i s essential to have political buy-in for regional initiatives. Further, other sub-regional projects show that in order for such programs to be successful, they must operate efficiently and be able to tailor programs to local demand. Government Strategy 92. Government officials in the OECS see the region’s projected economic growth as a window of opportunity to address the urgent need o f providing relevant sk i l ls for unemployed youth to enter the labor market, as well as an opportunity to help transition the labor force into higher end services that produce greater value added. The OECS Development Charter ’ See Annex 1 for APL objectives, program eligibility criteria, and procedures for subsequent operations o f the APL. 25 emphasizes the need to enhance the sk i l ls o f i t s citizens as wel l as generate sufficient quality j ob opportunities to reduce crime and violence among youth and absorb greater numbers o f the labor force. 93. The Government of Grenada has sent a clear message that skills training and reduction of unemployed youth are priority policy goals for the next four years. This priority i s reflected in the 2006 budget entitled “Focusing on Youth Development, Poverty Reduction and Stability,” which outlines a comprehensive medium term reform program that identifies the development o f human resources and a reduction in unemployment as key priorities. Finally, in i t s 2006-2008 Medium Term Economic Strategy paper, the Government l i s ts the fol lowing among i t s strategic development objectives: P To improve the employment potential o f t he current unemployed; and P To review and revise the education and training system to ensure i t s harmony with current national and international development priorities. 94. The above objectives reflect the Government’s desire to improve the economic and social welfare o f i t s people through initiatives aimed at increasing employment and income and reducing dependency. In regard to this, particular attention i s being given to vulnerable groups such as the rural poor, the uneducated and unskilled, and young people. For example, the Government’s Grenada Training and Employment Project (GTEP) aims to provide immediate support to young people in their quest for employment by providing them with soft ski l ls training, a brief technical training, and in some cases a short internship. 8 As outlined in a letter from the Prime Minister 26 Annex 2: Major Related Projects Financed by the Bank and/or other Agencies GRENADA: OECS (GD) Skills for Inclusive Growth Sector Issue Project Latest Supervision Addressed (ISR) or OED Ratings (listed in Section B.2) (Ban k-financed proj :ts) Implemen Develop -tation ment Program Objective 0 (DO) Status, Amount, Project Objectives Bank-financed operations in the OECS General Public Grenada - OECS Technical Assistance Project (P101322). This S S Administration project was approved by the Board on 03/13/2008 for the total amount o f SDR 1.2 million (US$1.9 million equivalent). The Project Development objectives are to: (i)im prove the efficiency and effectiveness of Customs, (ii)im prove the efficiency o f t ax administration and decrease transaction costs of paying taxes and consequently increase tax compliance, (iii)m odernize investment promotion, and (iv) enhance Government’s support to the export sector through improving access to trade information and strengthening the capacity of the Bureau o f Standards to provide conformity assessment and quality assurance. Vocational Training, St. Lucia - OECS Skills for Inclusive Growth (P097141). This MS MS Social Services, and project was declared effective on 12/19/2007. Total amount: SDR General Public Sector 2.4 million (US$3.5 million equivalent). The objective o f t he first phase o f t he APL i s to assist the Government of St. Lucia to increase the employability o f y outh through private sector driven training. The OECS countries’ Grenada Hurricane Ivan Emergency Project (P092692). The S S resilience, preparedness, project i s currently active. Additional financing was requested and and ability to respond to the closing date was extended to 6/30/2009. Total amount: the effects o f natural US$lO.O million. The project aims at supporting the recovery disasters efforts o f the Government o f Grenada through the financing of critical imports and rehabilitation activities in key social sectors. Due to the catastrophic losses in the education and health sectors, and their core importance to Grenadian society, the focus of this project i s to rehabilitate infrastructure in these areas. Expand and improve Grenada - OECS Education Development Program MS MS quality o f secondary (P077759). This project i s currently active with a closing date of education to make it 12/30/08, but the Government has requested an extension to the more equitable project. Total amount: US$8.0 million. The objectives are to: (i) increase equitable access to secondary education, including replacing and rehabilitating secondary schools damaged by the passage of Hurricane Ivan on September 7,2004; (ii) improve the quality and efficiency o f Secondary Education, and (iii)s trengthen the institutional capacity o f t he education sector. St. Vincent and the Grenadines - OECS Education MU MS Development Program in (P086664). This project i s currently active, expected to close on 12/30/2008. Total amount: US$6.2 million. Objectives and components same as above. 27 St. Lucia - OECS Education Development Program (P077712). S S This project i s currently active, expected to close on 09/30/2008. Total amount: US$12.0 million. Objectives and components same as above. St. Kitts and Nevis - OECS Education Development Program (P075978). This project i s currently active, expected to close on 06/30/2009. Total amount: US$S.O million. Objectives: Same as above. Prevent the spread of Grenada - 2"d Phase APL HIV/AIDS (P076715). The project i s HIV/AIDS, improve currently active, expected to close 06/30/2009 (revised closing access to care for date). Total amount: US$6.0 million. The objectives are: 1) HIV/AIDS curbing the spread of HIV/AIDS epidemic; 2) reducing the morbidity and mortality attributed to HIV/AIDS; 3) improving the quality o f l i f e for persons living with HIV/AIDS (PLWAs); and 4) developing a sustainable organizational and institutional framework for managing the HIV/AIDS epidemic over the longer term. St. Vincent and the Grenadines HIV/AIDS Prevention and S MS Control Project (P076799). The project i s currently active, expected to close on 06/30/2009. Total amount: US$7.0 million. The Project will support the national program that aims to prevent and to control the spread of the epidemic, and to mitigate the socio- economic impact o f t he disease on the population. St. Lucia HIV/AIDS Prevention and Control Project (P076795). S MS The project i s currently active, expected to close 06/30/2009. Total amount: US$6.4 million. The Project will support the national program that aims to prevent and to control the spread of the epidemic, and to mitigate the socio-economic impact o f the disease on the population. St. Kitts and Nevis HIV/AIDS Prevention and Control Proiect S MS (P076798). The project i s currently active, expected to close" 06/30/2008. Total amount: US$4.0 million. Project aims to support selected activities of St. Kitts and Nevis' Strategic Plan for the National Response to HIVIAIDS, under the four component: advocacy and behavior change; prevention in high risk groups and general population; access to treatment, care and support for persons living with HIVIAIDS; surveillance, epidemiology and research. Expand and improve Caribbean Learning and Knowledge Network (together with the tertiary education via use EU). The overall objective i s to contribute to upgrading and o f ICT and improved diversifying sk i l l s and knowledge o f the Caribbean people, through collaboration greater regional connectivity and collaboration. The project aim i s to develop regional capacity to utilize affordable ICT to enhance the competitiveness of its labor force. The main activities are: (i) a series o f consultant inputs and workshops in support o f t ertiary education institutions in the development o f strategic planning, financial and human resource management capacity, (ii) support for consultations regarding financing models for tertiary education, (iii)p rovision o f bandwidth access at affordable prices, (iv) workshops to strengthen technical I T and human capacities in the institutions, (v) implementation of region-wide mechanisms and systems to facilitate the movement o f k nowledge and courses, and (vi) strengthening o f t he CKLN Foundation to administer the Region-wide elements of the project. OECS Telecommunications & ICT Development Project S S (P088448). The project i s currently active, expected to close 28 I 12/31/2009. Total amount: US$2.71 million. Improve the access, I quality and use o f telecommunications and ICT services to achieve socio-economic development in the OECS. St. Lucia Disaster Management Project I1( P086469). The S S project i s currently active, expected to close on 12/31/2009. Total amount: US$7.50 million. The project aims at further reducing the country’s vulnerability to adverse natural events (hurricane, floods, etc.) through investment in risk management activities. As such, the objectives o f t he project are to further strengthen (a) infrastructure against the impact o f adverse natural events (hurricanes, flooding, etc.) through the implementation o f physical mitigation measures; (b) the response capacity in case o f adverse natural event (hurricane, flooding, etc.) through capacity building, equipment purchase and investment in emergency infrastructure; and (c) the institutional capacity of the various ministries and agencies dealing with disaster management through the provision of adequate facilities, critical equipment, technical assistance and training. Bank-financed operatioi in L A C on lifelong learning and training Dominican Republic Youth Development Project (P096605). Mu MU Total amount: US$25.0 million. Project i s not yet effective. The project’s development objective i s to support the Government of the Dominican Republic (GoDR) in improving the employability o f poor at-risk youth by building their work experience and l i f e skills, and expanding second chance education programs to complete their formal education. Honduras Nutrition and Social Protection Project (P082242). MS MS The project i s currently active, expected to close on 06/30/2010. Total amount: US$20.0 million. The project development objective i s to improve Honduras’ social safety net for children and youth. This would be achieved by (i) improving nutritional and basic health status of young children through and expanding the successful AIN-C program, and (ii) increasing employability o f disadvantaged youth through piloting a First Employment program. The coordinated implementation o f these interventions constitutes the first step towards consolidating the government’s institutional and technical capacity to formulate, coordinate, and monitor a comprehensive social safety net. This objective supports government’s strategy o f fostering human capital investment among poor families in the poorest municipalities o f the country to reduce uovertv. Other donor-financed p jects in the OECS STEP (OASICIDA) The Organization of the American States (OAS) Small Tourism Enterprise Program (STEP), begun in 1998. The program targets the OECS and eight other countries in the Caribbean. The program has two key objectives: 1) enhancing the competitiveness o f tourism enterprises to meet international standards, and 2) training and capacity building programs tailored to the requirements o f small tourism enterprises. The first component of the program was designed to help small hotels in the Caribbean gain access to technology and provide internet-based training. The second component of the project focused on the need for skil ls training to improve service quality in the region. The STEP project secured a licensed agreement with the American Hotel and Lodging Association- Educational Institute(AHLA-EI) and with AHLA consent modified the AHLA certified line staff “Ski l ls for Success” 29 training module to be appropriate for the small hotel sector in the Caribbean. The project’s central goal- to increase the competitiveness of small hotels in the region in the global tourism market-has been met and the program has worked with over 7000 small hotel employees. Over 1000 hotel employees from establishments across the Caribbean have been certified and 327 Caribbean trainers certified to continue the delivery of the AHLA certified ‘Skil ls for Success’ adapted training module. EU The education projects which the Delegation implementedh currently implementing in St. Lucia are: National Ski l ls Development Centre (NSDC), the School Feeding Programme, and the Multi-Annual Training Programme. 1) NSDC: NSDC i s a relatively new organization established to promote skil ls training for displaced farmers, farm workers and other un- and under-employed. The on-going programme of support to NSDC provides financing, Le., for the expansion o f coverage (new plant at rural site), the running o f training courses at the main centre and the development o fj ob attachment schemes. 2) School Feeding Programme: The overall aim of the project was to develop the human resource base o f St. Lucia by improving the quality of access to education and to develop a sustainable school- feeding programme. 3) Multi-Annual Training Programme: The primary aim of the project was to produce highly skilled cadres in specialized areas. Scholarships were provided to candidates selected on the basis of aptitude and a commitment to serve the St. Lucian government. Training took place, at regional universities (University o f West Indies) as well as overseas universities (primarily situated in the 30 Annex 3: Results Framework and Monitoring GRENADA: OECS (GD) Skills for Inclusive Growth Results Framework 95. The objective o f the second phase o f the APL i s to increase the employability o f Grenadian youth through public/private sector partnerships for technical and l i fe ski l ls training that i s demand driven. 96. This objective has three intermediate outcomes with associated l ines o f action: (Training) to increase job-related competencies among unemployed youth through the establishment o f a competitive training mechanism that supports the financing and delivery o f demand driven training; (Framework) to improve the quality and value o f training in Grenada and enhance OECS collaboration in training through the adoption o f an occupational standards framework that i s validated locally and recognized regionally; and (Capacity building) to strengthen institutional capacity to plan, implement, and monitor training. 31 sz 0 0m 0 m0 0 In CJ 0 2 Z 0 Wrn 0 d v, OQ Q x m 0 0 I 0 3 m n r4 0m m 0 0 m 0 0 0 j I E ' I Arrangements for Monitoring of Results 97. One o f the objectives o f the project i s to contribute to the setup o f the National Training Agency (NTA). The monitoring and evaluation o f t he activities and outcomes o f t he project will be one o f t he responsibilities o f t he National Training Agency. 98. The NTA’s Management Information System (MIS) will play the leading role in the collection o f M&E data for the project. The Government o f Grenada has hired a consultant to design the system in advance o f project approval, using funds from a Japanese project preparation grant. Additionally, there will also be a programming consultant who will be hired to program and build the NTA’s M I S to the specifications o f the design consultant. This will be supported under the project and it i s eligible for retroactive financing if contracted in advance o f the project effectiveness date. 99. The monitoring and evaluation system will develop procedures and tools to track the fol lowing key aspects o f t he project: a. adoption o f s tandards b. registration and participation o f employers in the training scheme C. auditing and approval o f training or assessment facilities d. qualification o f assessors e. pre-qualification and accreditation o f t raining providers f. participation o f t raining providers in the training scheme g. submission and selection o f t raining course proposals to the NTA h. application o f youth to the training scheme 1. registration and counseling o f youth applicants into training courses j. attendance o f a nd payment o f stipends to trainees during pre-service training k. completion o f p re-service training by trainees 1. assessment o f t rainees in competency units leading to qualification m. attendance o f a nd payment o f t ransportation allowance to trainees during traineeship n. completion o f t raineeship 0. certification o f trainees on their qualifications as wel l as other individuals who are not in the program but have the required sk i l ls and have been assessed. This includes the development o f a National Qualifications Register that will have information on individuals and their qualifications. Arrangements for Evaluation of Results 100. The following activities will be carried out to evaluate the results o f the project, and give feedback for improvement o f it: a. short exit survey for trainee dropouts b. quick satisfaction survey o f t rainees at the middle o f t he pre-service training c. focus groups o f t rainees (including dropouts), employers, and training providers d. online survey o f t raining providers and employers e. tracking survey o f t rainees at various points after the start o f t he training f. summative evaluation report between 17-20 months after the start o f t he training 35 Annex 4: Detailed Project Description GRENADA: OECS (GD) Skills for Inclusive Growth 101. This design o f this project wi l l draw upon the design and early lessons learned in a similar training project in St. Lucia developed under the first phase o f the APL. Hence, the description o f the Grenada project i s expected to resemble that o f St. Lucia. The project will consist o f three interlinked components: Component 1 - Ski l ls training for unemployed youth; Component 2 - Establishing an occupational standards framework to improve the quality and value o f training; and Component 3 - Institutional strengthening and project management 102. The components are closely linked in the sense that Component 1 will support the delivery o f the ski l ls training to unemployed youth by financing a competitive, demand-driven training scheme while Component 2 will support policies and regulation that enhance the quality and value o f training delivered and the sustainability o f the training scheme financed under Component 1. Component 3 will finance the strengthening o f institutional capacity and project management to carry out the establishment o f the framework and provision o f quality training in a sustainable manner. A monitoring and evaluation system wi l l contribute to evidence-based decision making and the agility to adapt to changing market needs. 103. Specific disbursement and procurement arrangements wi l l be defined during project preparation. The aim i s to keep the design simple. Financing o f training (component one) wi l l be against training course proposals, based on per capita amount per trainee. One objective wi l l be to incorporate a performance-based incentive to training providers to ensure quality delivery. A final percentage o f the payment would be contingent on the trainee’s completion o f the course and certification. I. Component 1: Skills Training for Unemployed Youth (US$2,090,000) 104. This component will finance the training o f approximately 1,200 unemployed youth through a competitive, demand-driven training scheme. The objectives o f the training scheme are to provide quality, competency-based sk i l ls and l i f e training to vulnerable youth, and to ensure that the training corresponds to labor market needs. Based on international best practice and specific experience through the St. Lucia project and prior sk i l ls training efforts in Grenada, six principles acquired through lessons learned are being employed to guide the design o f Grenada’s training scheme: (i)tr aining i s demand driven and offered in partnership with the private sector; (ii)t raining addresses issues o f employability and career mobility o f the workforce; (iii)tr aining combines behavioral/life sk i l ls and technical sk i l ls modules; (iv) training i s delivered in short and focused modules; (v) training includes a monitored apprenticeship in companies; and (vi) the training scheme seeks efficiency, quality and value o f training through regional collaboration, recognition and portability o f skil ls. 105. Training will be targeted to unemployed youth ages 18-30 who are secondary school leavers (drop outs or graduates). 36 106. Training will begin with the combination o f a short, l i f e skills and technical ski l ls module that meets at least the minimum criteria for level one certification (about 340 hours o f technical training). This will be followed by a structured apprenticeship with a participating public/private employer that is monitored by the training provider. Throughout the training scheme, certified assessors will be utilized to administer periodic competency assessments o f the trainees. Upon completion o f the technical and apprenticeship process, trainees meeting the competencies for level one certification will earn a national vocational qualification certificate (NVQ). The project will begin offering training for entry level trainees in one or two sectors (most likely the hospitality and construction sectors according to the Employers’ Needs Assessment) in the f i rs t year o f implementation. Once the implementing agency has gained experience and critical parts o f the framework supported under Component Two are in place, expansion to other sectors (horizontal) and levels (vertical) i s envisioned. The timing and pace o f expansion will be finalized during the appraisal mission. 107. The training scheme will organize and finance training o f young unemployed individuals on a regular basis. Each “round” o f t raining entails the fol lowing steps: (i) outreach to, and enrollment of, trainees, training providers, and employers; (ii) a call for training course proposals in specific employment sectors; (iii) matching eligible trainees, f i r m s and training providers; (iv) three to four months o f pre-service training, including a l i fe sk i l ls module and a technical sk i l ls module, using a standards-based curriculum; (v) four months apprenticeship with an employer/firm; (vi) assessment and certification o f each trainee’s skills by certified assessors; and (vii) monitoring and evaluation at each step o f t he process and after certification. 108. Trainee stipends and financing. The project will pay each trainee a modest stipend to provide minimum income support for the trainee to undertake the training and offset the costs of, for example, transportation and chi ld care in order to participate. During the l i f e sk i l ls and technical training coursework, the stipend wil l be EC$1Y day (equivalent to US$5.57/day) and during the apprenticeship the stipend per day increases slightly to EC$20/day (US$7.44/day) since many businesses are not located directly in St. Georges (an extra bus trip i s included). The stipend during the coursework and l i fe sk i l ls i s financed by the credit and the stipend during the apprenticeship i s financed by the employer. 109. Unit Cost for the Training Scheme. The unit cost per trainee has been estimated based on adjusted average o f sk i l ls training provided by entities in Grenada varying from the T.A. Marryshow Community College’s technical and vocational program to the N E W L O program. The cost for training one participant includes the following: Training components Unit cost 1. l i f e sk i l ls training (60 hours) - instructor’s fee, classroom rental US$137.64 and stipend to trainee 2. technical classroom training (approx. 340 hours) - instructor’s US$1,029.03 37 110. The l i f e ski l ls and technical classroom training combined will take place at training facilities including secondary schools’ that are equipped with technical and vocational education classrooms. The courses will most l ikely be offered 4 hours per day. The apprenticeship will fol low at 8 hours a day for three and a hal f months16. 111 . As detailed above, the unit cost i s composed o f the training tutor’s hourly fee, times the duration o f the course, materials and equipment, and a stipend for the trainee. The unit cost will be reviewed annually to ensure that it remains in sync with average market rates for training. Calculation o f t he unit cost is detailed in Annex 5. 112. The cost was also compared to the actual costs o f other vocational training programs in Lat in America and the Caribbean countries. Other vocational training programs targeted to young people in Latin America and the Caribbean are estimated from a l o w o f US$691 for the PROJoven program in Peru to about US$1,50017. The St. Lucia Skills for Inclusive Growth Project has a unit cost o f US$1,351 which includes the pre-service training and the apprenticeship. The costs in Latin America and the Caribbean countries are comparatively lower than OECD countries. Costs o f programs in OECD countries such as Canada, the UK and the United States range from $950 for the New Deal for the Young Unemployed in the UK to $17,151 for the U.S. Job Corps. Program costs vary depending on their duration and intensity. Also, inclusion o f v ariable costs as wel l as fixed costs determines these differences. 113. Key criteria for private sector willingness to participate in both the training and the mandatory youth apprenticeship scheme was explored through focus groups with stakeholders. Feedback from focus groups and the Employers’ Needs Assessment showed that employers are willing to contribute when they are sure the investment will directly benefit them versus a contribution through a general levy for training. Grenadian businesses expressed a willingness to pay the cost o f the stipend to the trainee during the apprenticeship period which i s a customary practice. They may also be willing to contribute a small percentage to the technical classroom training, but reactions were mixed. It i s l ikely that positive results o f the training scheme will demonstrate returns that would persuade businesses to invest. 114. The project’s impact will depend critically upon i t s ability to attract unemployed youth, employers, and training providers. Through the assistance o f a PHRD grant during project preparation, these three groups o f stakeholders have been consulted by means o f focus groups, representative membership on the government’s preparation team, and ad-hoc meetings. They will continue to inform project design during preparation. 115. The following sections detail the proposal and matching process under Component I.I t includes: the generation o f training course proposals, the selection and evaluation process, the application o f trainees, and matching them to a selected course. A detailed diagram o f the process i s illustrated in Figure 2. ’’A fter regular school hours. l6L ength o f the apprenticeship wi l l be verified during appraisal. It could be reduced to about three months. Shown in 2005 USD. 38 A. Generation o f Course Proposals 116. The following steps detail the generation o f proposals by employers and eligible training providers: Eligible employers review their training needs and capacities. 0 The N T A provides a l is t o f pre-qualified training providers to f i r m s or associations or other eligible parties. The NTA initiates a call for training course proposals. Proposals must either (i)re spond to a direct need for trained persons identified by the private sector; or (ii)re spond to a need for training identified by the Ministry o f Economic Development and Planning (MOEDP) in response to a forecasted demand for ski l ls based on national economic development priorities or prospects. The needs for training in (ii)w ill be made public at the time o f the call for proposals so that providers can prepare proposals to address them. 0 Proposals are prepared and submitted by the training providers, in collaboration with employers. Proposals can be generated in one o f four ways: o Initiation by Training Provider: Eligible' training providers contact employers directly. Providers propose training and agree with employers on training a certain number o f trainees in agreed areas o f training (average course size should be 15- 20 trainees). o Initiation by f i r m s and brokering by a sector association. A sector business association, such as the Grenada Hotel and Tourism Association (GHTA), or another institution coordinates a training proposal for several (smaller) employers. o Initiation by f i r m s and brokering by the NTA: Firms can submit a request for training o f a certain number o f trainees to the NTA. The NTA will seek to incorporate those requests with other proposals or act as a broker. However, the proposal would be submitted by a training provider to the NTA, not by the NTA itself. o Response by a training provider to a need for training identified in the call for proposals: A training provider may choose to respond to a need for training identified by the N T A in the call for proposals. Conditions for the proposals (endorsement o f traineeships by employers) wil l be required as for other proposals. 0 The training proposals are submitted to the NTA. These proposals are binding to the training providers/employers submitting them. This means that, if they are approved for funding, training providers and employers are bound to execute the training. Potential sanctions include exclusion from participation in future calls for proposals. B. Selection o f Winning Submissions 11 7. The following steps detail the process o f selecting the winning proposals 0 The Ministry o f Finance / PCU sets the annual budget availability for the project. '* In the initial phase of the project, eligible training providers wil l be those who are pre-qualified. Once the accreditation system i s operational, the NTA may decide to render the eligibility criteria more stringent and limit eligibility to accredited training providers. 39 0 A technical evaluation committee for each sector will review the training proposals and ensure that the proposals meet the eligibility criteria (see Table 2). This body will consist o f well-respected and independent individuals who have no conflict o f interest with the training proposals. In particular, the members cannot be linked to any submitted training proposal. The committee, as a minimum, will consist of: a training expert from the NTA, a pedagogy specialist, and a recognized sector specialist. The technical evaluation committee submits i t s recommendations for approval to the Steering committee that wil l make the final selection. In case the demand for funds exceeds the amount allocated for training, the technical evaluation committee will use these additional pre-defined and published selection criteria to select the winning proposals: o The technical quality o f t he proposals. o The amount that the firms/employers are willing to co-finance. o Preferential treatment for small establishments (less than 50 employees). o Prior performance o f t raining providers o Prior performance o f employer The operational manual will establish the following selection criteria: (i)m inimum level o f quality required to be acceptable; (ii)s pecifications for the cost o f training: fixed cost with competition on quality, or a combination o f cost and technical quality; (iii) Maximum allowable price per trainee. C. Application and Matching o f Trainees 118 . Matching the right trainee to employer and training provider i s critical to maximize the probability o f success at the end o f the program. This requires a trilateral match in that: (i)th e capabilities and attitudes o f t he trainee must meet the needs o f t he employer, and the trainee must have interest in working with the employer; (ii)tr aining must respond to the employer’s needs; and (iii)tr ainees have the abilities to learn enough during the pre-service training to successfully complete the training, and the training adequately imparts knowledge to the trainees. At the same time, it i s important that the courses be offered to youth that belong to the target group o f the project. 11 9. The fol lowing steps detail the process o f enrolling and selecting interested youth: 0 In order to manage expectations and to ensure commitment o f the applicants, the application process for trainees will start only when the NTA has determined which courses will be available. 0 The NTA will coordinate an intensive outreach campaign to inform and attract youth into the program. This outreach will include Community Development Officers. The CDOs will invite interested youth to apply for the program at the local training center or secondary school. In each o f those centers, youth will be informed about the courses available and will be asked to fill in an application form. 0 The information will be entered immediately into a web based system by registration personnel. The web based system will record the time and date o f registration through a time stamp. Youth will be required to present their national ID and their National Insurance Scheme P I S ) number if they possess one. 40 The web based system will be hosted at the NTA, which wil l administer the database o f applicants. The database should have built-in checks that allow it to evaluate the fol lowing eligibility criteria: (i)ag e; (2) self-reported work experience and training. 0 The NTA will check the remaining eligibility criteria. Table 4.1 details the eligibility criteria and their means o f verification. Checking o f the eligibility criteria will be done on an ongoing basis as the registration process proceeds, to ensure prompt completion o f the process. I t will be done in the order o f application, using the time and date stamp in the database to determine this order. 0 Young persons who have applied or are interested may attend an orientation session, which i s a group session that outlines the program including the structure o f the training, expectations from participants, etc. For the youth that i s determined to be eligible and in the order o f application, the NTA will schedule an appointment with applicants to attend a counseling session. The aims o f the counseling session are the following: (i)c onfirm the eligibility o f the applicant for the program, through verification o f any outstanding criteria; (ii)i dentify strengths and weaknesses in trainee aptitude, and identify trainee interests; (iii)re commend possible training areas and occupations best suited to the trainee; (iv) identify whether the trainee has sufficient literacy in order to successfully complete a Level I training; (iv) if appropriate, recommend the courses best suited to the trainee’s aptitudes and interests. Applicants whose level o f literacy i s found to be insufficient will be required to enroll in “Yes I Can,” a remedial program offered by the Ministry o f Education, in order to be allowed to enroll in a “Skills for Inclusive Growth” course. 0 The results o f the counseling session, including recommended courses, will be entered into the NTA database by the counselor. 120. Matching o f eligible and counseled applicants to winning proposals 0 The NTA verif ies the number o f t rainees required from the winning proposals. 0 The final decision on which trainees will be assigned to which courses will be made by the NTA. 41 Figure 4.1: Call for Training Course Proposals, Selection, and Matching Mechanism Development and Information on future investment Planning (MOEDP) areas G involving training providers and employers Employers Eligibio Ernployya determines Training I ' I & Ttztinee Needs providers and employers, responding Training aid ittarki.1 courses directly 10 providers and employers brokered by sector n Sector IScctor Sect"or assn pro\ ides input NI'A on associations d\Sloo QCBS,QBS,FBS,LCS,CQS All 50 Comparison o f 3 CVs in All (by TTL) accordance with Chapter V o f Guidelines <50 ( 6 TOR only (by TTL) Regardless o f value Sole Source All (by TTL) Note: QCBS = Quality and Cost Based Selection QBS = Quality Based Selection FBS = Fixed Budget Selection LCS = Least Cost Selection CQS = Selection based on Consultants’ Qualifications 69 Annex 9: Economic and Financial Analysis GRENADA: OECS (GD) Skills for Inclusive GAwth 193. The youth training program through the training fund i s expected to affect youth employment outcomes on two dimensions: the probability o f employment and wages for employed youth. The following economic analysis computes the combinations o f employment probability and wage increases that will lead to positive returns for the project. The analysis then compares the necessary employment probability and wage increases to those that were attained in similar projects in Latin America. Finally, the analysis compares the results from those projects to the results that are required to attain a positive return to investment in Grenada, and evaluates the Grenada project from the economic return point o f view. Assumptions in the economic analysis General assumDtions Assumption Svmbol /Formula (monthly wage o f non-trained school leaver with program I 830 I W I probability o f employment at 12 months from registration, if 22 The rate o f exchange on 09/22/2006 was 2.67 XCD/lUSD. 70 194. Table 9.1 summarizes the assumptions that are made in the economic analysis. A number o f assumptions merit further explanation. The following two questions are essential to the economic analysis: (i)C eteris paribus, what i s the probability that a young person, who i s unemployed today, wi l l be employed within six months from now? (ii)C eteris paribus, what i s the probability that a young person, who i s unemployed today, will be unemployed twelve months from now? The first question i s important because it determines the opportunity costs o f participating in the training program. The second question i s important because it provides the benchmark for comparing employment outcomes for youth that do not participate in the training fund. 195. Transition probabilities from unemployment to employment are traditionally not available from household surveys, because those surveys typically collect static cross-sectional data that do not provide employment statistics over time. Instead, we use a 2006 survey o f secondary school graduates from St Vincent, which did provide historic employment information, to estimate transition probabilities between employment and unemployment. (Vermeersch 2006) Table 9.2: Probability o f transition to employment, by time of unemployment Conditional on being unemployed at month , . . after Employment at month.. . 7 13 I 19 25 31 7 -_ I -- 13 43% 21% _ _ 19 51% 37% 33% 25 55% 44% 46% 31 66% 62% 62% 37 65% 64% 68% 196. Table 9.2 reports the probability that a young person wi l l be employed at particular points in time, given that this person was unemployed 1 month after graduation, 7 months after graduation, etc. The top number in each column gives the probability that the person wi l l be employed, if unemployed six months earlier. The probability o f employment after 6 months ranges from 3 1 to 56 percent, with an average o f 35 percent. The second number from the top in each column reports the probability that the person wi l l be observed to be employed, if unemployed twelve months earlier. The probability o f employment after 12 months ranges from 37 to 64 percent (47 percent on average). 197. Given these numbers for St. Vincent, the economic analysis wi l l assume that the probability o f employment during the training (first 6 months after registration o f unemployed persons for the training program) i s 25 percent. The 35 percent figure was adjusted downwards to reflect (1) lower levels o f education among Grenada training candidates than among St Vincent respondents; (2) the fact that average employment level during the f i rst 6 months i s lower than the final employment at 6 months. 71 198. We will also assume that the probability o f employment 12 months after observation of unemployment is 40 percent, lower than the 47 percent in St Vincent respondent, because Grenada training candidates have lower education levels than St Vincent respondents. 199. Unfortunately, the latest survey o f the labor force in Grenada was done in 1997, and the last population and housing census dates back to 2001. There are no household survey data available for the country. As a substitute, we use data from St Lucia 23 to compute the probabilities o f employment change according to age. Graph 9.1 plots the cross-sectional probability o f employment by age, where the probability o f employment for each person is defined as the number o f months that the person worked for pay in the past 12 months. If we assumed that the training only increases wages when the trainee finds a job shortly after completion o f t he training (i.e. the training has no influence on wages if there i s a large time gap between training and employment), then the economic analysis does not need to take into account the interaction between higher wages and higher probability o f employment as trainees get older. Graph 9.1: Probability o f employment amongst low-educated population, St. L ~ c i a ~ ~ I I I I I 20 40 60 80 Age I Probability of working in a given month Fitted values I 23 World Bank calculations, using the 2005 St. Lucia household survey (LSMS). 24 The probability o f employment i s calculated as the number o f months that each person worked for pay in the last 12 months. The graph plots this probability, averaged by age group. The sample excludes any persons that have more than 4 secondary school exam leaving qualifications, as well as persons with tertiary education qualifications. The calculations include persons who are unemployed and not looking for work. 72 200. Monthly wage and employment probability change in absence of training: The wage income data in the 2005 St Lucia household survey could not be used to estimate the average wage o f young persons. Instead, we use the St Vincent data to estimate the average wage. Vincentian secondary school graduates earned an average o f 830 ECD per month during the first 3 years after graduation. Wages among the target group in Grenada were assumed to be 830 ECD because: (1) Vincentian graduates had a higher level o f education than Grenadians in the target group; (2) Per capita GDP in St Vincent was EC$10,139 in 2004, while it was EC$10,611 in Grenada. Rate o f return of the project 201. We now use the proposed assumptions and various scenarios o f employment and wage impacts to compute the Ne t Present Value and Rate o f Return o f Project investments. Assume that x i s the percentage point change in the probability o f employment at 12 months from registration if a young person i s assigned to the training program. Assume that y i s the percentage increase in wage for young people who have employment 12 months after training, compared to young people who have employment without training. The ensuing percentage increase in wage mass for the target group which can be attributed to the training program i s reported in Table 9.3. This percentage increase in wage mass i s also the percentage increase in the average wage o f the target group, when taking into account both unemployed persons (who have wage 0) and employed persons. Table 9.3: Increases in wage mass as a result o f changes in wages and employment probability Formula: B = [(l+y)*x]/E + y x=percentage point increase in probability of employment - 0% 2.5% 5% 7.5% 10% 12.5% 1% I% ypercentage 5% 5% increase in 10% 10% wage mass for constant population 15% 15% 20% 20% 202. The percentage increase in wage mass, together with the status quo level o f wages, can then be used to compute the present value o f training (Table 9.4), the net present value o f training (Table 9.9, and the Rate o f Return to investment25( Table 9.6). 25 Rate o f Return or Return on Investment (ROI) i s the ratio of money gained or lost on an investment to the amount o f money invested. (Wikipedia) 73 Table 9.4: Present value of training under several discount rate and wage mass increase scenarios Formula: PV = w*l2*E*B*( l /d)*( l - d=discount rate 1/ ( 1+ d)^n)+3.5 *I 5% 7.50% 10% 1% 608 573 545 B = Increase in wage mass 5% 1838 1667 1524 or average wage for target 10% 3376 3035 2748 group 15% 4915 4402 3972 20% 6453 5769 5 196 25% 799 1 7137 6420 30% 9529 8504 7644 35% 11067 987 1 8868 40% 12605 11239 10092 Table 9.5: Net present value o f training under several discount rate and wage increase scenarios Formula: NPV = PV - C d=discount rate 5 Yo 7.5% 10% 1% -5 145 -5 179 -5208 B = Increase in wage 5% -3915 -4085 -4229 mass 10% -2376 -2718 -3005 15% -838 -1351 -1781 20% 25% 30% 3776 35% 53 14 41 19 3115 40% 6853 5486 4339 Table 9.6: Rate o f return o f training under several discount rate and wage increase scenarios Formula: RR = NPV/C d=discount rate 7.5% 10% -89.44% -90.03% -90.53% B = Increase in wage 15% -14.57% -23.48% -30.95% 20% 12.17% 0.29% -9.68% 25% 38.91% 24.06% 11.60% 30% 65.64% 47.82% 32.88% 35% 92.38% 71.59% 54.15% -40% 119.12% 95.36% 75.43% 203. As appears f rom Table 9.6, an increase in average wage income o f 20 percent i s needed to ensure a positive rate o f return with a discount rate o f five percent, while an increase in average wage income o f 25 percent i s needed to ensure a positive rate o f return with a discount rate o f 10 percent. Combinations o f changes in the employment rate and changes in wages that 74 wi l l lead to at least 20 (25) percent increase in average wage rates, are highlighted (resp. bolded) in Table 9.3. Summary o f impacts o f other job training programs 204. Two review papers by Dar and Tzannatos (1 999) and Betcherman, Olivas and Dar (2004) survey the results o f impact evaluations o f active labor market policies, including training programs for the unemployed, and youth training programs. 205. Training for the general population of unemployed: For general training for the unemployed, Dar and Tzannatos (1999) showed that the interventions with the most positive returns were smaller-scale, on-the-job-training programs that directly met labor market needs and were well targeted, especially for women and other disadvantaged groups among the long-term unemployed. Martin and Grubb (2001) find that most programs that demonstrated gains for participants did so through improved employment opportunities rather than through higher hourly wages. Betcherman, Olivas and Dar (2004) mention that 28 our o f 39 studies o f training for the unemployed showed a positive impact on future employment, while only 15 out o f 29 studies showed positive impact on earnings. Outcomes in developing countries seem to be less encouraging than in developed countries. 206. Youth training programs: Dar and Tzannatos (1999) concluded that youth training programs in developed countries had the poorest track record, when compared with training programs for the long-term unemployed and those displaced through mass layoffs. Social rates o f return were typically negative, both in the short-and the long run. Between 1999 and 2004, results from new impact evaluations in developed countries maintained this general conclusion Betcherman, Olivas and Dar (2004). However, results from youth training programs appeared to be different in the case o f the “Jovenes” programs in Latin America. O f the 5 new evaluations o f youth training programs in Latin America between 1999 and 2004, all showed positive employment impacts and two o f the three computing earning effects demonstrated positive impacts on that indicator. The Jovenes programs in Argentina, Chile, Peru and Uruguay have the following common features26: they are targeted at disadvantaged youth, combine training and work experience with other services including psychological development, conventional assessment, etc. Implementation involves important roles for civil society and the private sector, and flexible, competitive and decentralized service delivery. Questions on the programs include long-term impacts, costs and potential coverage o f these kinds o f programs. (Betcherman, Olivas and Dar (2004)). Among the studies o f “Jovenes” programs, the Dominican Republic study i s the only one that uses experimental assignment to training to construct the control group. This i s clearly a weakness and therefore the results o f the studies must be interpreted with caution. Assessment 207. With interventions that were similar to the planned intervention in Grenada, two out o f the five projects (Peru, Chile) achieved results which, if attained in Grenada, would yield positive rates to the Grenada project. If the Grenada project impact were similar to those in the Argentina project, the rate o f return to investment would be positive only for adult females, but ~ 26 Note that those features are also common to the St. Lucia project. 75 not for the other groups of beneficiaries. The Brazi l project yielded only small impacts overall. Were the results o f the Grenada project similar to those in the Brazil project, the rate o f return would be negative. Were the results o f the Grenada project similar to those in the Dominican Republic project, the rate o f return would be borderline negative. The results from Uruguay cannot be interpreted because the original paper was not available at the time o f writing. It i s important to note that the economic analysis does not take into account the positive externalities o f the project that are associated with reduced crime and violence. At this point, there i s insufficient evidence to estimate the potential impact o f this type o f project o n youth risky behavior, though an evaluation i s currently under way in the Dominican Republic. 208. I t i s important to note that the fol lowing returns and costs are omitted from the analysis: (i)P ositive spillovers on firm productivity; (ii)R educed social costs related to reduced risky behavior and crime; (iii)C rowding-out effects: trainees that are “subsidized” by the training program may crowd out other trainees which are not subsidized; (iv) Economic returns to the introduction o f occupational standards in the Grenadian economy and sub-regionally. 76 Table 9.7: Summary of results from youth training programs in Latin America’’ Intervention design Type o f Evaluation Impact on wages Impact on Total employment impact (B) Argentina Training program for Propensity score Impacts on Impact on 16-29 year olds in matching monthly earnings employment was “Programa lower socioeconomic were stat statistically Joven” levels, 1996-1997, (Aedo and Nuiiez significant for significant for technical knowledge 200 1) young males (USD adult females phase and internship 17-23) and adult only. phase. Labor Ministry females (USD 26- (10-13 hired educational 32). percentage institutions through Percentage? points) bidding process Brazil Training for Paez de Barros Small impact Small impact PLANFOR marginalized youth, 2002 1996-1998 Chile Training and Positive 25.2 occupational practice perc. points “Chile package o f 6 months group = neighbors Joven” o f beneficiaries (Santiago Consultores Asociados. 1999) Impact o f a Employment supplemental increased by 8- 13 financial incentive, percent, 50 matching percent o f trained youth found jobs Bravo and I after employment Contreras (2000) Peru Marginalized young Matchin-g and diff- I Positive 18 % on 5.5 % additional urban populations in-diff hourly wages hours per week “Projoven” 6% percentage (Ropo, Robles points more and Saavedra, employment 2002) Increase in employment in medium and large size companies, less micro-entreprise employment Uruguay Short term training and Bucheli and Earnings higher by Probability o f in-firm subsidized employment *’T his section draws on Betcherman, Olivas and Dar (2004) 77 “Uruguay employment for 6- 12 Paper not increased by 60 Pro Joven” months available Paper not percent. available Paper not available Dominican Young persons 16-29 Experimental Wage increase of No change in 10-15 YO Republic years 10-15 percent o f probability of High school dropouts Card et al. (2006) base wage employment (56- “Programa from 4 poorest deciles 57 %) Juventud y Empleo” Colombia ILO paper not 6 0 ) available 78 References Aedo, Cristian and Sergio Nufiez (2001), “The Impact o f Training Policies in Latin America and the Caribbean: The Case o f “Programa Joven,” unpublished manuscript, ILADEWGeorgetown University. Bravo, David and Dante Contreras (2000), “The impact o f financial incentives to training providers: The case o f Chile Joven,” unpublished manuscript. Betcherman, Gordon, Karina Olivas, and Amit Dar (2004), “Impacts o f Active Labor Market Programs: New Evidence from Evaluations with particular Attention To Developing and Transition Countries,” The World Bank, Social Protection Discussion Paper Series, No. 0402. Card, David, Pablo Ibarraran, Ferdinand0 Regalia, David Rosas and Yuri Soares (2006), “Labor Market Impacts o f a Youth Training Program in the Dominican Republic: Evidence from a Randomized Evaluation”, unpublished manuscript. Dar, Amit and P. Zafiris Tzannatos ( 19 99), “Active Labor Market Programs: A Review o f the Evidence from Evaluations,” Social Protection Discussion Paper No. 9901, The World Bank, Washington D.C. Friedlander, D., Greenberg, D. H., and Robins, P. K. (1997). Evaluating government training programs for the economically disadvantaged. Journal of Economic Literature, 35, 1832-18 48. fiopo, Hugo, Miguel Robles and Jaime Saavedra (2002), “Una medicion del impact0 del Programa de Capacitacion Laboral Juvenil PROJoven,” Working Paper dt36, Grupo de Analisis para e l Desarrollo (GRADE), InterAmerican Development Bank, Washington D.C. Santiago Consultores Asociados (1 999), “Evaluacion Ex-Post Chile Joven 11,” CINTERFOR. Vermeersch, Christel (2006), “The Transition from Secondary School to Work: An Empirical Investigation,” Background Paper, The World Bank LCSHD. 79 Annex 10: Safeguard Policy Issues GRENADA: OECS (GD) Skills for Inclusive Growth 209. No safeguard policy issues are triggered for this project. 80 Annex 11: Project Preparation and Supervision GRENADA: OECS (GD) Skills for Inclusive Growth ~ ~~ ~ ~ ~~ ~~ Planned Actual PCN review 04/17/2008 04/18/2008 Initial PID to PIC 04/23/2008 04/23/2008 Initial ISDS to PIC 05/01/2008 05/01/2008 Appraisal 09/08/2008 - 09/16/2008 09/08/2008 - 09/16/2008 Negotiations 11/18/2008 - 11/19/2008 11/18/2008 - 11/19/2008 Board/RVP approval 0 1/ 15/2009 Planned date o f effectiveness 03/01/2009 Planned date o f mid-term review 03/01/2011 Planned closing date 09/0 1/ 20 13 Key institutions responsible for preparation o f the project: The Ministry o f Education (MOE) (The Grenada Council for Technical and Vocational Education and Training (GCTVET) and National Training Agency (NTA) are established semi-autonomously under the direction o f the Ministry o f Education.) Bank staff and consultants who worked on the project included: Name Title Unit Angela Demas Task Team Leader LCSHE Christel Vermeersch Economist LCSHE Daniela Marotta Economist LCSHE Yuki Murakami Economist LCSHE Thomas McArdle Sr. Director, Jamaica HEART Trust Consultant Viviana Gonzalez Team Assistant LCSHD Svetlana Klimenko Sr. Financial Management Specialist LCSFM Judith Morroy Procurement Analyst LCSPT Norma Rodriguez Procurement Analyst LCSPT Fabiola Altimari Country Lawyer LEGLA Alonso Sanchez Economist LCSHE Miguel-Santiago Oliveira Finance Officer LOAFC Peer Reviewers: t 0 Andreas Blom, Sr. Education Economist, SASHD 0 Amit Dar, Lead Education Economist, SASHD 0 Cornelia Tesliuc, Social Protection Specialist, LCSHD 81 Bank funds expended to date on project preparation: 1. Bank resources: US$215,588.45 2. Trust funds: US$124,014.27 3. Total: U78$339,602.72 Estimated Approval and Supervision costs: 1. Remaining costs to approval: US$8,000 2. Estimated annual supervision cost: US$80,000 82 Annex 12: Documents in the Project File GRENADA: OECS (GD) Skills for Inclusive Growth Aedo, C and Nufiez, S. May 2001. The Impact of Training Policies in Latin America and the Caribbean: The Case of ‘Programa Joven ’. ILADES/Georgetown University, Washington, DC. Attanasio, 0.;K ugler, A.; Meghir, C. November 2007. Effects of Youth Training in Developing Countries: Evidence from a Randomized Training Program in Colombia. Blom, A. and Hobbs, C. 2008. School and Work in the Eastern Caribbean: Does the Education System Adequately Prepare Youthf or the Global Economy? February, 2008. Washington, DC. Card, D. et. al. February 2007. The Labor Market Impacts of Youth Training in the Dominican Republic: Evidence from a Randomized Evaluation. Working Paper 12883. National Bureau o f Economic Research, Cambridge, MA. Charles, L. September 2007. Summary of focus group meetings with stakeholders. Diaz, J. and Jaramillo, M. October 2006. An Evaluation of the Peruvian Youth Labor Training Program PROJOVEN. Working Paper OVE/WP- 10/06. Dunn-Smith, P. 2008. Report on the training of members of the Grenada Council for Technical and Vocational Education and Training, January 19,2008. Eastern Caribbean Central Bank. 2008. The Eastern Caribbean Currency Union Economic Review 2007. ECCB Headquarters, St Kitts. Eastern Caribbean Central Bank. National Accounts Statistics 2007, for the year ended 31 December 2006. Volume 27, Number 3, September 2007. Eastern Caribbean Central Bank. 2007 Annual Economic and Financial Review. Eastern Caribbean Central Bank. 2007 Annual Economic and Financial Review. Finlay, P. 2007. Overview of Caribbean Association of National Training Agency (CANTA). Harmonization Workshop, September 25th -28th, Trinidad and Tobago Government o f Grenada. (draft) 2008. TVET Framework. Ministry o f Education. Government o f Grenada. 2007. 2008 Budget Speech Presentation, Friday, November 30, 2007, Grenada. Hickling Corporation. March 2008. Employer Needs Assessment Survey. Ottawa, Canada Jarvie, W. 2005. Australia’s vocational education & training system and its links with secondary education. Growth strategies for secondary education in Asia. September 19, 2005, Kuala Lumpur. 83 McArdle, T. March 2006. Job Training in the OECS: an Overview and Analysis of Programmes and Activities. Ministry o f Youth Development. 2006. IMANI Programme. Prime Minister’s Office, Grenada. Ministry o f Youth Development. 2004. Grenada Youth Enterprise Initiative Lending Policy. Prime Minister’s Office. Ministry o f Youth Development. 2006. Grenada Youth Enterprise Initiative (GYEI). Prime Minister’s Office. Thomas, S. November 30, 2007. Review of Labour Market Data and Information Systems: Grenada. World Bank. 2005. Towards a New Agenda for Growth. Organization o f Eastern Caribbean States, Washington, DC. World Bank, 2007. World Development Indicators 2007. World Bank, Washington, DC. 84 Annex 13: Statement of Loans and Credits GRENADA: OECS (GD) Skills for Inclusive Growth As of December 8,2008 Difference between expected and actual Original Amount in US$ Millions disbursements Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev’d PO76715 2003 GD 2nd Phase APL HIVIAIDS rev.&Control 3.00 3.04 0.00 0.00 1.38 3.16 6.04 3.85 PO77759 2003 GD EDUCATION DEV (2nd APL) 4.00 4.00 0.00 0.00 1.08 1.41 8.00 0.00 PO82392 2006 GD Public Sector Modernization TAC 0.00 3.50 0.00 0.00 0.00 3.13 1.03 0.00 PO92692 2005 GD (4APL) Hurricane Ivan Emerg. Rec. 5.00 5.00 0.00 0.00 0.00 0.35 10.00 0.00 P101322 2008 GDTAC 0.00 1.86 0.00 0.00 0.00 1.97 0.40 0.00 GD (AF) Education Dev -2nd APL (not P1 13342 2009 effective yet) 0.00 1.90 0.00 0.00 0.00 0.00 1.90 0.00 Total: 12.00 19.30 0.00 0.00 2.46 10.02 27.38 3.85 GRENADA STATEMENT OF IFC’s Committed an Disbursed Outstanding Investment Portfolio As of September 30,2008 In Millions o f U S Dollars Committed Disbursed IFC IFC FY Company Loan Equity **Quasi *GT/RM Partic. Loan Equity **Quasi *GT/RM Partic. Approval 2002 Bel air 0.88 0 1 0 0 0.88 0 1 0 0 0 0 Total portfolio: 0.88 0.00 1 0 0 0.88 0 1 0 0 * Denotes Guarantee and Risk Management Products. * * Quasi Equity includes both loan and equity types. 85 Annex 14: Country at a Glance GRENADA: OECS (GD) Skills for Inclusive Growth Grenada at a glance UIZQiUB Latin Upper- America middk- Grenada ti Carib. incoma 0.1% 583 523 4.678 5.wa 8.687 hiife expemancy 0.61 3.118 5.750 D.Q z .3 a ? 2.7 1 3 GMI Gross Per p n m w capita enrsllment 3% 78 75 73 73 71 L 16 22 22 5 Access lo improved water S W ~ P : ~ 91 e5 90 83 e3 ii a % ? 7 as 120 112 a7 116 rm i93? 2006 m07 GDP (US9 b # k W 0 17 om Q.52 0 55 Gros3 captal brmrticn!GWP 33 2 37 B Exports of goQds and sew cesEIJP 48.0 440 Gross &omes.tic savmgrfGDB 12 4 11 a Gmsr natenal uvingslODP 19.8 12 w C u m 1a caswnl balancelODP -13.6 -25.9 -23.9 Interesf paymenWiSWP 1 2 O B z .3 Taw1 debtiBiDP 48 D 37 8 03.8 Twal debt sorwceleqmrm 8 7 4.3 $2.4 Prevpni value af deblrODP 105.1 Fresoni value of debtlexpolss 337.4 IndeMedness 119B?-97 I W ? 4 7 2wc 2007 MOT4 4 l a w e a nnvai3mwthI GDP 2.2 3 1 0.7 3.0 - G r ~ GDP per capita d .3 2 2 -0.8 3.0 -U pper-mdal'e-mcome group 'Exports af $wds and se+wces 2.8 STRUCTURE afthc ECONOMY $387 I337 2006 21307 I% af GQP) P.griwHure i a 7 6 4 e.7 I lndusby i a o 21 d 23.0 13 Manufamuring 5 9 9 9 5 9 Serwres 82 4 70 0 6 4 3 3 Househob3 fmal cansumpeicn exp.ersdit.ire 87 2 74 B -1 U General gov? final oonwnpbcn expenditure 20 4 95 7 impofis of gccdr and sewices 68 E eo 7 1987 -97 18S7-57 2006 2007 jawrage annuat gmwth I A~rie~nuture - 1 B -1 s 23.8 industry 3 D B Y -5.4 Manufaaunng 5 1 ' 1 5 $ 1 Srrvces 3 3 I@ 1 8 Hausehc15f inal zansummticn exmendituse 2 6 General gov? fina uonsunptioo er.pendirure -0 5 Gross wptaI farmatitroo 2 5 Impoh of gooas and sewices 2 4 Ncee: 2007 data are preliminary estmales. Tha lab e was pm&aed p1 the Develmpnient Eccanon-tms LDB database " 'he d jrnmds show bur key in&d'rMtur3 in me countv (In bold) cmnpwed with ias income-group average If data are -11 ssing. the c anand will be ncrpniuiete 86 PRICES and GOVERNMENT FlWlRMCE 1987 i397 2006 20.07 Domes& prices Inflation (ubi c (ORs I I c c prices -0 8 ? .3 3.E 4 Implien GDP defatw 4 1 -1 1 2.B 2-8 I :2 -I a Cumnt revenue 24 8 36.7 I m 01 w cs CE a Gumnt budget balance -0.3 3 3.3 Owwail surpibslldef ttl 4 1 4 . B TRADE *§a7 997 2006 2007 (US%r ntTbnsJ Tc43I expotis {fob) 32 33 Nutmeg 7 Fish 4 Manulacrures 1% Toial imp~rts4 10; 173 Food 24 37 Fuel and energy 5 14 Capital mods 21 45 Expcnt price imex [2CW=fOO) 81 lmpon p r ~ cand ex {20UO=t UU) 110 Ternis of e&e 42b)GO=1001 74 BAMHCE or PAYMENTS 18g7 1997 2006 2007 (US%r niffians) Current account balance to GDP (%I Experts d wods 3m3 se~xe~sws 85 142 165 Impons of goous and 5Kuices $21 223 35 5 Resoume balance -35 -8 1 -192 Net nmw -7 -18 -2f Net o u m it ransfers t e 20 Current acts~~mb'al lance -23 -78 -126 26 85 13 4 -3 -7 -5 J C 1 Menta: Resewes including g&3 (US$ maflmns] 43 Conversion rete ,CaEG, halxIS%)r 2 7 2.7 2 7 2 7 EXTERHAL DEBT and RESOUWE FLOWS 1s g? 1997 200.6 21007 ( U S rncilonrsl Tdal debt cunstandtn~a~n d dusbirrsed 77 116 492 IBRD D 0 8 12 IDA 3 7 28. 55 Tc4al debk serwcp 6 7 15 IBRD 0 0 2 2 IDA 0 0 t 1 Cmipmrtion af net resource flaws Official grants B 4 4 al m C tc rs B 10 20 k credirors -1 - 1 CI Foreign direct invedment (ne? imflcrrrs) f 5 34 119 P o r n l o aqurty (ne1 InP'mm] D D 0 World Bank program Commitments 0 0 4 4 D sbwsernenis 1 0 4 10 Pnncipal repayments D 0 1 2 Net wws 7 O 3 0 Interest pawnerits D 0 1 1 Net Iran s k r s 1 O 2 6 The Wcrhd Bank Gwup This table was prepared by munby pmt 573# figures may dffer from olhff Wwld Bank pub tshw data 'i!24ica8 Map Section IBRD 33412 IBRD 33412 61°45' 61°30' 61°45' 61°30' SAINT VINCENT SAINT VINCENT AND THE AND THE GRENADINES GRENADINES Petit Petit Martinique Martinique GRENADA GRENADA 12°30' 12°30' 12°30' 12°30' Hillsborough Hillsborough Grand Bay Grand Bay CARRIACOU CARRIACOU Carriacou Carriacou Saline Island Saline Island Frigate Island Frigate Island Large Island Large Island Caribbean Caribbean Sea Sea Diamond Island Diamond Island Les Tantes Les Tantes Ronde Ronde Island Island Caille Island Caille Island London Bridge London Bridge 12°15' 12°15' 12°15' 12°15' Sauteurs Caille Island Sauteurs Caille Island Levera Sandy Island Levera Sandy Island Pond Pond Grenada Grenada SAINT Bayk Bird Island 0 1 2 3 4 5 6 Kilometers SAINT Bayk Bird Island 0 1 2 3 4 5 6 Kilometersc c Victoria MARK tt. P a VictoriaS SAINT Lake MARK t St. P a Antoine 0 1 2 3 4 5 6 Miles SAINT Lake Antoine 0 1 2 3 4 5 6 Miles PATRICK PATRICK Gouyave Mt. Saint Tivoli GouyaveThis map was produced by the Map Design Unit of The World Bank. Mt. Saint Tivoli Catherine Catherine This map was produced by the Map Design Unit of The World Bank. (840 m) The boundaries, colors, denominations and any other information (840 m) The boundaries, colors, denominations and any other informationshown on this map do not imply, on the part of The World Bank shown on this map do not imply, on the part of The World Bank SAINT Group, any judgment on the legal status of any territory, or any Group, any judgment on the legal status of any territory, or anyParadise endorsement or acceptance of such boundaries. SAINTGreat River Paradise endorsement or acceptance of such boundaries.Grand Roy t Grand Roy t Great RiverJOHN a JOHN a Gre Bay Gre Bay Grenville 61°30' Grenville 61°30' Grenville Grenville SAINT Bay SAINT Bay Beaus ANDREW MarquisGrenada Beau ANDREW MarquisGrenadajo Grand su Étang GRENADA jo Grandr ur Étang GRENADA South South Vendôme East Mt. Vendôme East Mt. SAINT (716 m) SAINT (716 m) GEORGE SAINT SELECTED CITIES AND TOWNS GEORGE SAINT SELECTED CITIES AND TOWNSST. GEORGE'S ST. GEORGE'S Belmont DAVID Saint David's PARISH CAPITALS Belmont DAVID Saint David's PARISH CAPITALS Grand Anse Corinth NATIONAL CAPITAL Grand Anse Corinth NATIONAL CAPITAL Bay Bay RIVERS RIVERS Calivigny Calivigny Point MAIN ROADS Point MAIN ROADS Salines 12°00' PARISH BOUNDARIES Salines 12°00' PARISH BOUNDARIES Glove Island INTERNATIONAL BOUNDARIES Glove Island INTERNATIONAL BOUNDARIES 61°45' 61°45' DECEMBER 2004 DECEMBER 2004 ri T H E G R E N A D I N E S ri T H E G R E N A D I N E S . Ma rks St e Mar ks St. e