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Document of The World Bank FOR OFFICIAL USE ONLY Public Disclosure Authorized Report No. 37702-AR PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$300 MILLION Public Disclosure Authorized TO THE ARGENTINE REPUBLIC FOR THE PROVINCIAL MATERNAL-CHILD HEALTH INVESTMENT PROJECT IN SUPPORT OF THE SECOND PHASE OF THE PROVINCIAL MATERNAL- CHILD HEALTH PROGRAM Public Disclosure Authorized October 6,2006 Human Development Sector Management Unit Argentina, Chile, Paraguay, Uruguay Country Management Unit Latin America and the Caribbean Regional Office Public Disclosure Authorized This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS Currency Unit: The Argentine Peso EXCHANGE RATE ARS$3.09 = USD$1 (Exchange Rate Effective 06/20/2006) FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AGN Auditoria General de la Nucidn [Supreme Audit Institution of Argentina] AIDS Acquired Immune Deficiency Syndrome APE Administracidn de Programas Especiales [Special Programs Administration] APL Adaptable Program Lending CAS Country Assistance Strategy CFAA Country Financial Management Assessment COFESA Consejo Federal de Sulud [FederalHealth Council] CPAR Country Procurement Assessment Report EPH Encuesta Permanente de Hogares [Current Household Survey] ESW Economic and Sector Work FSR Fondo Solidario de Redistribucibn [Solidarity Redistribution Fund] GDP Gross Domestic Product GNI Gross National Income GOA Government of Argentina HN Human Immune-deficiency Virus HSRP Health Sector Reform Program IDB Inter-American Development Bank IFC International Finance Corporation IF1 International Financing Institution LO International Labor Organization IMF International Monetary Fund IMR Infant Mortality Rate INDEC Znstituto Nacional de Estadisticu y Censos [National Institute of Statistics and Census] IPP Indigenous Peoples Plan IPPF Indigenous Peoples Planning Framework IUFR Interim Unaudited Financial Report LCSHH Unit of Health, Nutrition and Population of the Latin America and the Caribbean Regional Office MCHIP Maternal and Child Health Insurance Program [Plan Nacer] MDGs Millennium Development Goals, United Nations MMR Maternal Mortality Rate MMR Measles, Mumps and Rubella Vaccine MSN Ministerio de Sulud de la Nucidn [National Ministry of Health] MSP Ministerio de Sulud Provincial [Provincial Ministry of Health] NEA Noreste Argentino [Northeast Region of Argentina] NHSPT National Health Services Purchasing Team NOA Noroeste Argentino [Northwest Region of Argentina] OSN Obras Sociales NacionaZes [National Social Health Insurance Organizations] OSP Obra Social Provincial [Provincial Social Health Insurance Organization] PAM1 Instituto Nacional de Seguridad Social de Jubilados y Pensionados [National Institute of Social Security for Pensions and Retirees] PBS Package of Basic Health Services PDO Performance Indicator PHSPT Provincial Health Services Purchasing Team PMO Prograrna Medico Obligatorio [Mandatory Medical Program] PMCHSAL Provincial Maternal-Child Health Sector Adjustment Loan PMCHAPL Provincial Maternal-Child Health Adaptable Program Lending PRL Provincial Reform Loan PROMIN Second Maternal and Child Health and Nutrition Project REMEDIAR Program for essential drugs to support the needs in provinces SEA Strategic Environmental Risk Assessment SIPICLAP Comprehensive Health Information System SOE Statements of Expense UFI-s International Financing Unit, National Ministry of Health VRDL Virology and molecular diagnostics WB World Bank WHO World Health Organization Note: For Argentine organizations and terms, the Spanish-language acronym is used in this document. Vice President: Pamela Cox Country ManagerDirector: Axel van Trotsenburg Sector Director: Evangeline Javier Sector Manager Keith Hansen Country Sector Leader Jesko Hentschel Task Team Leader: Cristian C. Baeza ARGENTINA PROVINCIAL-MATERNAL CHILD HEALTH INVESTMENT PROJECT (Second Phase Adaptable Program Lending) CONTENTS Page A . STRATEGIC CONTEXT AND RATIONALE .............................................................................. 3 1. Country and Sector Issues ....................................................................................................... 3 2 . Rationale for Bank Involvement.............................................................................................. 8 3 . Higher-Level Objectives Furthered by the Project .................................................................. 9 B. PROJECT DESCRIPTION.............................................................................................................. 9 1. Lending Instrument.................................................................................................................. 9 2 . Program Objectives and Phases ............................................................................................... 9 3 . Project Development Objectives and Key Indicators............................................................ 10 4 . Project Components ............................................................................................................... 10 5 . Lessons Learned and Reflected in the Project Design........................................................... 14 6 . Alternatives Considered and Reasons for Rejection ............................................................. 14 C .IMPLEMENTATION ......................................................................................................................... 15 1. Partnership Arrangements ..................................................................................................... 15 2. Institutional and Implementation Arrangements ................................................................... 15 3 . Monitoring and Evaluation of OutcomesResults ................................................................. 20 4 . Sustainability ......................................................................................................................... 22 5 . Critical Risks and Possible Controversial Aspects ................................................................ 23 6 . Loadcredit Conditions and Covenants................................................................................. 24 D. APPRAISAL SUMMARY .................................................................................................................. 25 1. Economic and Financial Analyses ......................................................................................... 25 2. Technical Features ................................................................................................................. 26 3 . Fiduciary Arrangements ........................................................................................................ 26 4 . Social Considerations ............................................................................................................ 27 5. Environmental Considerations .............................................................................................. 28 6. Safeguard Policies ................................................................................................................. 28 7 . Policy Exceptions and Readiness .......................................................................................... 29 Annex 1: Country, Sector, and Program Background .......................................................................... 30 Annex 2: Major Related Projects by the Bank and Other Agencies .................................................... 36 Annex 3: Results Framework and Monitoring ...................................................................................... 40 Annex 4: Detailed Project Description ................................................................................................... 48 Annex 5: Project Costs ............................................................................................................................. 52 Annex 6: Implementation Arrangements ............................................................................................... 53 Annex 7: Financial and Disbursement Arrangements .......................................................................... 57 Annex 8: Procurement Arrangements .................................................................................................... 69 Annex 9: Economic and Financial Analysis .......................................................................................... 77 Annex 10: Safeguard Policy Issues.......................................................................................................... 79 Annex 11: Principal findings of APL-I implementation ...................................................................... 84 Annex 12: Project Preparation and Supervision ................................................................................... 91 Annex 13. Documents in the Project File............................................................................................... 92 Annex 14: Baseline for Tracers (“Trazadoras”) denominators ........................................................... 93 Annex 15: Statement of Loans and Credits ............................................................................................ 94 Annex 16: Country at a Glance ..............................................................................................................