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Bolivia Higher Education for Rural Youth Entrepreneurship

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Bolivia Higher Education for Rural Youth Entrepreneurship CONFIDENTIAL INTERNAL USE PUBLIC UPON APPROVAL DOCUMENT OF THE INTER-AMERICAN DEVELOPMENT BANK MULTILATERAL INVESTMENT FUND BOLIVIA HIGHER EDUCATION FOR RURAL YOUTH ENTREPRENEURSHIP (BO-M1070) DONORS MEMORANDUM This document was prepared by the project team consisting of: Fernanda Padrón (MIF/CBO), Elizabeth Minaya (MIF/CPE), Maritza Vela (MIF/AMC), Siobhan Pangerl (MIF/AMC), María Elena Nawar (MIF/MIF), and Enrique Ignacio Barragán Crespo (GCL/LSO). This document contains confidential information relating to one or more of the ten exceptions of the Access to Information Policy and will be initially treated as confidential and made available only to Bank employees. The document will be disclosed and made available to the public upon approval. CONTENTS EXECUTIVE SUMMARY I. BACKGROUND AND RATIONALE ................................................................................ 1 A. Background .................................................................................................. 1 B. Diagnostic assessment of the problem to be addressed by the project ......... 4 C. Project beneficiaries ..................................................................................... 5 D. Contribution to the MIF mandate and IDB strategy ....................................... 6 II. PROJECT OBJECTIVES AND COMPONENTS................................................................ 7 A. Objectives..................................................................................................... 7 B. Description of the model ............................................................................... 7 C. Components ............................................................................................... 10 D. Project governance and execution arrangements ....................................... 13 E. Sustainability .............................................................................................. 14 F. Lessons learned in designing the project by the MIF and other institutions . 14 G. MIF additionality ......................................................................................... 15 H. Project outcomes ........................................................................................ 15 I. Project impact ............................................................................................. 15 J. Systemic impact ......................................................................................... 16 III. MONITORING AND EVALUATION STRATEGY ............................................................. 16 IV. COST AND FINANCING ........................................................................................... 17 V. EXECUTING AGENCY ............................................................................................. 18 VI. PROJECT RISKS .................................................................................................... 19 VII. ENVIRONMENTAL AND SOCIAL IMPACTS .................................................................. 20 VIII. FULFILLMENT OF MILESTONES AND SPECIAL FIDUCIARY ARRANGEMENTS ................ 20 IX. ACCESS TO INFORMATION AND INTELLECTUAL PROPERTY ....................................... 20 - ii - PROJECT SUMMARY HIGHER EDUCATION FOR RURAL YOUTH ENTREPRENEURSHIP (BO-M1070) ANNEXES Annex I Logical Framework Annex II Summary Budget Annex III Quality for Effectiveness in Development (QED) Matrix APPENDICES Proposed resolution AVAILABLE IN THE DOCUMENTS SECTION OF THE MIF PROJECT INFORMATION SYSTEM Annex IV Itemized Budget Annex V Preliminary List of Milestones Annex VI Executing Agency Diagnostic Needs Assessment (DNA) Project Status Reports, Fulfillment of Milestones, Fiduciary Agreements, and Annex VII Institutional Integrity Annex VIII Procurement Plan Annex IX Schedule of Activities Annex X Operating Regulations Annex XI Terms of Reference for Project Coordinator Annex XII Monitoring and Evaluation Plan for Impact Evaluation ABBREVIATIONS DNA Executing Agency Diagnostic Needs Assessment INE National Statistics Institute Unidad Académica Campesina de Carmen Pampa [Campesino Academic Unit UAC-CP at Carmen Pampa] UCB Universidad Católica Boliviana Unidades productivas y/o de servicios [UAC-CP’s production or services UPS businesses] Page 1 of 2 EXECUTIVE SUMMARY Country and The project will be executed in the Plurinational State of Bolivia and the intervention geographic location: area will be the Los Yungas region of La Paz Executing agency: Unidad Académica Campesina of Carmen Pampa [Campesino Academic Unit at Carmen Pampa] (UAC-CP) Coordination with The current partnerships between UAC-CP and two development finance other donors/Bank institutions (MIF partners) will be expanded to finance youth business ventures that operations: arise: (i) Diaconía-FRIF, which is currently executing BO-X1011 (EcoMicro); and (ii) Fundación Sembrar Sartawi, which is currently executing BO-X1014 (EcoMicro). The objective of the current Diaconía-FRIF agreement is for UAC-CP students to provide technical assistance to their rural clients on measures to adapt to climate change. Fundación Sembrar Sartawi currently finances scholarships for UAC-CP students. Direct beneficiaries: - 900 young people (at least 50% women), aged 16 to 29, mainly from the rural communities of Los Yungas, La Paz1 will receive training on business management and entrepreneurship. Of these, 45% are currently studying degree programs at UAC-CP and 55% have either graduated in previous years or are not affiliated with UAC-CP. - Of the 900 young people, 500 (at least 50% women), aged 16 to 19, mainly from the rural communities of Los Yungas, La Paz, will start a business or strengthen an existing business. Four hundred of these businesses will be sustained for one year or more after being launched. - 1 rural university, located in the Carmen Pampa community of the Los Yungas region, department of La Paz, which currently has 700 students across five degree programs: agronomy, veterinary medicine, rural tourism, education, and nursing. It will have an education model focused on rural entrepreneurship. Indirect beneficiaries: - 3,600 indirect beneficiaries, four family members per direct beneficiary. - 200 general jobs through the businesses sustained for one year after being launched, not including the entrepreneur (one part-time job is estimated for each business: 400*0.5 = 200). Financing: Technical cooperation funding: US$750,000 44% Total MIF contribution: US$750,000 Counterpart: US$950,000 56% Cofinancing: (if applicable) - Total project budget: US$1,700,000 100% Execution and 36 months for execution and 42 months for disbursement. disbursement period: Special contractual The following will be conditions precedent to the first disbursement: (i) approval of clauses: the Operating Regulations and (ii) contracting of the project coordinator. 1 A region of subtropical valleys (from 350 to 1,700 meters above sea level) renowned for its production and tourism, strategically located less than 100 kilometers from the city of La Paz. Executive Summary Page 2 of 2 Environmental and This operation was evaluated and classified in accordance with the requirements of Social Impact Review the IDB’s Environment and Safeguards Compliance Policy (Operational Policy OP-703). As the risks and impacts are limited, this project is proposed as a Category C operation. Unit responsible for MIF/CBO disbursements: I. BACKGROUND AND RATIONALE A. Background 1.1 In recent years, Bolivia has made considerable gains on social development indicators: between 2005 and 2012, extreme poverty fell at the national level from 38.2% to 21.6%, and between 2001 and 2011, the average years of education of the population aged 19 or over increased from 7.43 to 9.13. However, there are still pronounced gaps between geographic areas: extreme poverty in urban areas is 12.2%, while in rural areas, it is 40.9%, and average years of education are 10.72 and 5.46 in urban areas and rural areas, respectively.2 These figures show that rural dwellers, 32.7% of the Bolivian population, face disadvantages relative to the urban population. 1.2 There are also significant differences in terms of income-generating opportunities and employment characteristics. In cities, there are numerous sectors as well as the possibility of self-employment or work as a salaried employee.3 However, in rural areas, 72% of the population works in agriculture and 6% in commerce; 70% is self-employed. 1.3 The current structure of the agricultural GDP,4 almost half of which stems from nonindustrial agricultural products, presents an opportunity for the boost to the sector to benefit not only the large producers, but also the small and medium- sized producers5—including young people. In this regard, boosting the agriculture sector and strengthening the entrepreneurial and business capacities of young people in rural areas has great potential to improve their living conditions and contribute to poverty reduction. According to the IDB, the growth generated by agricultural GDP in Latin America could be up to four times more effective in reducing poverty than the growth generated by other sectors, because of the high percentage of the population that still has ties to the land.6 1.4 Providing education in rural areas is a key element. Efforts should continue to provide education that is relevant to the social, economic, productive and cultural 2 Data on extreme poverty from the Ministry of Economy and Finance (2014), Economía Plural, February 2014. Data on years of
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