January 2007, Eduardo Araral, Camilla Holmemo / The World Bank
The purpose of this report is to update and refine the economic analysis of the KALAHI-CIDSS Project (the Project) as an input to the Project’s 2006 Midterm Review. This work builds upon previous analyses done during project preparation in 2002 and preparatory update work done in early 2005. It also takes into account lessons from project implementation to date, as well as insights from similar projects, such as the Kecamatan Development Project (KDP) in Indonesia, comparable projects in the Philippines, and similar studies by the Operations Evaluation Department (OED) of the World Bank.
The project development objective of KALAHI-CIDSS is to strengthen the participation of local communities in barangay governance and develop their capacity to design, implement, and manage development activities that reduce poverty. Ideally, therefore, economic analysis should focus on the valuation of benefits of these development investments. While it is too early in the project cycle to make this kind of assessment, it is possible to make preliminary inferences (using 2003 baseline survey data) of how these investments might be associated with expected benefits, such as a closer match between demand and supply and the better operation and maintenance of projects.
The main focus of this analysis is, however, the economic impacts of the Project. It looks at the costs and benefits of seven major subproject (SP) categories that cover 1,175 completed and ongoing subprojects (e.g., domestic water supply [both pump and gravity], roads construction and improvement, elementary school buildings, barangay health centers, and day care centers). These seven major categories accounted for 82 percent of total subproject costs.
