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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Document of The World Bank FOR OFFICIAL USE ONLY TECHNICAL ANNEX ON A PROPOSED GRANT IN THE AMOUNT OF SDR 3.8 MILLION (USS6.0 MILLION EQUIVALENT) TO THE ROYAL KINGDOM OF CAMBODIA FOR AN Report No: T7674 AVIAN AND HUMAN INFLUENZA CONTROL AND PREPAREDNESS EMERGENCY PROJECT UNDER THE GLOBAL PROGRAM FOR AVIAN INFLUENZA AND HUMAN PANDEMIC PREPAREDNESS AND RESPONSE (GPAI) FOR ELIGIBLE COUNTRIES UNDER THE HORIZONTAL APL February 27,2008 Rural Development, Natural Resources and Environment Sector Unit Sustainable Development Department East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

2 CURRENCY EQUIVALENTS (Exchange Rate Effective September 2007) Currency Unit = Cambodian Riels (KHR) 1 Cambodian Riel = US$ US$l.OO = 4,015 Riels US$l.OO = 1 S2647 SDRs FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AH1 AI AIDS APL ARI AWP CAM-EWAR CBDRM CDCD DAHP EMP EMPF EU FA0 FM GDP GPAI HSSP HIV HPAI H5N 1 MIAs IBRD IDA IEC IFR ILI IPA IPC MAFF MEF M&E MIS MOH NBC NCDM NIC NGO NVRI OAHP OIE PDO PDR Avian and Human Influenza Avian Influenza Acquired Immuno-Deficiency Syndrome Adaptable Program Loan Acute Respiratory Infection Annual Work Program Cambodia Early Warning System Community Based Disaster Risk Reduction Programs Communicable Disease Control Department Department of Animal Health and Production Environmental Management Plan Ethnic Minorities Planning Framework European Union Food and Agriculture Organization Financial Management Gross Domestic Product Global Program for Avian Influenza Control and Human Pandemic Preparedness and Response Health Sector Strengthening Project Human Immuno-Deficiency Virus Highly Pathogenic Avian Influenza is one strain of the HPAI virus Implementing Agency/Implementing Agencies International Bank for Reconstruction and Development International Development Association Information, Education and Communication Interim Financial Report Influenza-Like Illness International Procurement Agent The Pasteur Institute Ministry of Agriculture, Forestry and Fisheries Ministry of Economy and Finance Monitoring and Evaluation Management Information System Ministry of Health National Bank of Cambodia National Committee for Disaster Management National Influenza Center Non-Government Organization National Animal Veterinary Research Institute Offices of Animal Health and Production Animal Health World Organization Project Development Objective People s Democratic Republic

3 PHRD PIP PPE PPRRP RC RGC RRT SARS UN UNDP UNICEF VAHW VHV WHO Policy and Human Resources Development Project Implementation Plan Personal Protection Equipment Pandemic Preparedness, Response and Recovery Program Rapid Containment Royal Government of Cambodia Rapid Response Team Severe Acute Respiratory Syndrome United Nations United Nations Development Program United Nations International Children Education Fund Village Animal Health Workers Village Health Volunteers World Health Organization Vice President: Country Director: Sector Director: Sector Manager: Task Team Leader: James Adams, EAPVP Ian Porter, EACTF Christian Delvoie, EASSD Rahul Raturi, EASRE Alan Piazza, EASRE

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5 CAMBODIA Avian and Human Influenza Control and Preparedness Emergency Project CONTENTS Page A. STRATEGIC CONTEXT AND RATIONALE Introduction Country and Sector Issues... 2 Rationale for World Bank involvement... 3 Country Eligibility under GPAI... 3 B. CAMBODIA: COMPREHENSIVE NATIONAL AH1 PLAN General Objectives... 4 Components of the National Plan... 4 Institutional Aspects... 6 Financing Requirements... 7 C. PROJECT DESCRIPTION Project Development Objective... 8 Project Components... 8 Lessons Learned and Reflected in the Project Design D. IMPLEMENTATION Partnership Arrangements Institutional and Implementation Arrangements Monitoring and Evaluation (M&E) of Outcomes and Results Sustainability, Critical Risks and Possible Controversial Aspects Grant Conditions and Covenants E. APPRAISAL SUMMARY Economic and Financial Analyses Technical Financial Management Procurement Social Environmental and Social Safeguard Policies... 20

6 7. 8. Safeguard Policies Policy Exceptions and Readiness Appendix 1: Results Framework and Monitoring Appendix 2: Detailed Project Description Appendix 3: Project Costs Appendix 4: Financial Management and Assessment Report Appendix 5: Procurement Arrangements Appendix 6: Environmental Analysis Appendix 7: Social Analysis Appendix 8: Economic Analysis Appendix 9: Discussion Notes Appendix 10: Good Governance Framework Appendix 11: Statement of Loans and Credits Appendix 12: Country at a Glance Map No. IBRD/IDA 34707R

7 CAMBODIA AVIAN AND HUMAN INFLUENZA CONTROL AND PREPAREDNESS EMERGENCY PROJECT Date: February 27, 2008 Country Director: Ian C. Porter Sector ManagedDirector: Rahul RatudChristian Delvoie Project ID: P Lending Instrument: Emergency Recovery Loan PROJECT APPRAISAL DOCUMENT EAST ASIA AND PACIFIC EASRE Team Leader: Alan L. Piazza Sectors: Health (50 percent);animal production (50 percent) Themes: Other communicable diseases (P);Rural services and infi-astructure (P);Natural disaster management (P) Environmental screening category: Partial Assessment Project Financing Data [ ] Loan [ ] Credit [XI Grant [ ] Guarantee [ 3 Other: For Loans/Credits/Others: IDA Grant SDR 3.8 million (US$6.0 million equivalent) Total Bank financing (USsm.): 6.0 million Proposed terms: IDA Grant Total: Borrower: Royal Kingdom of Cambodia Responsible Agency: Ministry of Economy and Finance (MEF) St. 92 Sangkat Wat Phnom, Khan Daun Penh Cambodia Tel: (855) Fax: (855)

8 ~~ 11?Y ~~ Estimated disbursements (Bank W/US$m) I 09 I 10 I 12 hual kmulative Project implementation period: Start July 1,2008 End: June 30,201 1 Expected effectiveness date: June 30, 2008 Expected closing date: December 30,201 1 Does the project depart from the CAS in content or other significant respects? Re$ Technical Annex (TA) Section A. Does the project require any exceptions from Bank policies? Re$ TA Section E.8 Have these been approved by Bank management? Is approval for any policy exception sought from the Board? Does the project include any critical risks rated substantial or high? Re$ TA Section 0.4 Does the project meet the Regional criteria for readiness for implementation? Re$ TA Section E.8 [ ]Yes [XINO [XIYes [ ]No [XIYes [ ]No [ ]Yes [XINO [ ]Yes [XINO [XIYes [ ]No Project development objective; Re$ TA Section C.1 and Appendix 2. Consistent with the Global Program for Avian Influenza and Human Pandemic Preparedness and Response (GPAI), which was approved by the Bank in January 2006, the project s overall development objective is to support the implementation of the Cambodia Comprehensive Avian and Human Influenza (AHI) National Plan (the AH1 Plan), contributing to minimize the threat posed to humans and the poultry sector by an AH1 infection in Cambodia, and to prepare for, control and respond (if necessary) to a human influenza pandemic. More specifically, the project is expected to provide direct support to the implementation of the National Comprehensive AH1 Plan to produce the following outcomes: (a) to contain the spread of the disease, thus reducing losses in the livelihoods of commercial and backyard poultry growers and damages to the poultry industry and diminishing the viral load in the environment; (b) to prevent or limit human morbidity and mortality by stemming opportunities for human infection, and strengthening curative care capacity; and (c) to prevent or curtail macroeconomic disruption and losses by reducing the probability of a human pandemic and improving emergency preparedness and response. Project description; Re$ TA Section C.2 and Appendix 2. Component A - Animal Health. The objective of the component is to reduce and, eventually, eradicate the H5N1 virus from the poultry sector in Cambodia. This will reduce the risk of human infection with avian and human influenza (AHI) and protect the poultry sector and the livelihoods of many small-holders and poor farm households. Additionally, upgrading the animal health system will improve livestock sector productivity with benefits for commercial and backyard producers. Component B - Human Health Systems. The component objective is to prevent the emergence of a human pandemic in Cambodia through the rapid identification and effective management of human cases. Strengthening public health systems will enhance national pandemic preparedness and help to reduce the loss of life that would result from a human pandemic caused by influenza.

9 Component C - Inter-Ministerial Cooperation for Pandemic Preparedness and Overall Project Coordination and Management. The objective of the component is to strengthen Cambodia's capacity to mobilize quickly and efficiently a coordinated multisectoral and societywide response to an influenza pandemic. Strengthening the coordinated response capacity for an influenza pandemic will also improve the effectiveness of Cambodia's response to floods, droughts and other natural disasters. In addition, the component will provide support to the overall coordination of project implementation, ensuring linkages across relevant agencies and partners, and to implement the project's Monitoring and Evaluation (M&E) System. Which safeguard policies are triggered? Re$ TA Section E. 6 and Appendices 7 and 8. The Environmental Assessment (OP4.01) and Indigenous Peoples (OP4.10) are triggered. The design incorporates the necessary mitigation measures for the adverse impacts associated with the activities involved in responding to AH1 outbreaks. An Environmental Management Plan (EMP) and Ethnic Minorities Planning Framework (EMPF) will be finalized during project implementation after consultation with various stakeholders (government agencies, the commercial poultry associations, mass organizations, and NGOs) and subsequently disclosed in Cambodia and Washington D.C. (Infoshop). Significant, non-standard conditions for: Re$ TA Section D. 5 Credit effectiveness: These will include: (a) the legal agreements regarding the cofinancing resources from the PHRD Grant and the AH1 Facility Grant are signed with the Recipient and all the conditions for their effectiveness (other than the effectiveness of the IDA Grant) have been met; (b) each Implementing Agency (IA) has hired the key staff responsible for project coordination and management, as required for their components (including government officials responsible for the coordination of each component and staff in charge of financial management and procurement), in a manner satisfactory to IDA; and (c) the Annual Work Program (AWP) for the first year of project implementation has been prepared by the Recipient and it is acceptable to IDA. Covenants applicable to project implementation: Dated Covenants. These include: (a) by July 31,2008, the project Environmental Management Plan (EMP) and the Ethnic Minorities' Planning Framework (EMPF), both satisfactory to IDA, have been approved by the Recipient, and have been properly disclosed in the country; (b) by September 30,2008, the Project Implementation Plan (PIP), satisfactory to IDA, has been prepared by the National Committee for Disaster Management (NCDM) in coordination with the IAs, including arrangements for implementation, procurement, accounting, financial management, auditing procedures, M&E and reporting arrangements; (c) the Ministry of Agriculture, Forestry and Fisheries (MAFF) and the NCDM will establish complete financial management systems acceptable to IDA, including the establishment of computerized accounting software, not later than September 30, 2008; (d) AWPs (with budgets) for each calendar year will be presented not later than 30 of September of the previous year for discussion with IDA; (e) annual physical progress reports and financial statements, not later than April 30 of each year and covering the preceding calendar year, will be presented to IDA for discussions and approval; (f) Interim Financial Reports (IFRs) for each quarter, not later than 45 days after the end of the quarter, will be presented to IDA; (g) a Mid-Term Progress and Assessment ReporZ will be

10 presented by the NCDM, in collaboration with the implementing agencies (IAs), for discussion with IDA, at the end of the second year of implementation; and (h) annual audits of the financial statements for the entire project will be submitted to IDA, together with the management letter, by independent auditors under Terms of Reference acceptable to IDA, within six months of the end of each financial year. In addition, the Recipient shall ensure that the project is carried out in accordance with the provisions of the Good Governance Framework (Appendix 10) and the Anti-Corruption Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed bv IBRD Loans and IDA Credits and Grants, dated October 15,2006.

11 A. STRATEGIC CONTEXT AND RATIONALE 1. Introduction 1. The continuing outbreaks of highly pathogenic avian influenza (HPAI) in recent years have caused substantial damage to the poultry industry in several regions of the world, resulted in some loss of human life and raised concerns about a possible human pandemic. Large-scale outbreaks began in 2003 in several Southeast Asian countries, and HPAI has now reached Europe, the Middle East and West Africa. More than 150 million birds have died from the disease or have been killed as part of the effort to contain HPAI. Economic losses to the Asian poultry sector alone are estimated at around US$10 billion. Much of these losses have been suffered by millions of poor farm households that depend upon poultry for home consumption and some cash income. 2. There have been 363 laboratory-confirmed human cases of infection with HPAI (hereafter referred to as Avian and Human Influenza - AHI) since 2003, and 228 of these infected people have died. Nearly all of the confirmed cases are known to have had contact with birds and, so far, AH1 does not transmit easily from human to human. However, the virus is evolving and it is believed that it may acquire the characteristics that would enable efficient human-to-human transmission.* Each additional human case gives the virus an opportunity to improve its transmissibility in humans and thus to develop into a pandemic strain. The recent spread of the virus to poultry and wild birds in new areas further broadens opportunities for human cases to occur. While neither the timing nor the severity of the next pandemic can be predicted, the probability that a pandemic will occur has increased. If the virus achieves high transmissibility between humans and is highly pathogenic, then a severe human pandemic could result with very large losses of human life and enormous economic disruptions and losses on a global scale. 3. The global response to the threat of AH1 in humans and domestic poultry comprises four key strategies: (a) progressively controlling and eradicating the spread of the disease in animals, thus lowering the animal-origin virus load in the environment and reducing the risks of human infection; (b) preventing and limiting the spread of the disease among humans, thereby reducing the opportunity for the virus to improve its human transmissibility; (c) in the event of a pandemic, helping affected populations cope with its effects; and (d) minimizing the social and economic impacts from the threat of AHI. The prevention and control of AH1 involves many players in the areas of health, agriculture, natural disaster response, finance and planning, and a multi-sectoral approach is therefore essential. It is also recognized that the actions of individual countries are Avian influenza, or bird flu, is a contagious disease o f animals caused by viruses that normally infect only birds and, less commonly, pigs. Avian influenza viruses are generally species-specific but have, on occasion, crossed the species barrier to infect humans. In domestic poultry, infection with avian influenza viruses causes two main forms of disease, distinguished by low and high extremes o f virulence. The low pathogenic form commonly causes only mild symptoms and may go undetected. The highly patogenic HPAI form causes disease affecting multiple internal organs and has a mortality rate that can approach loopercent, often within 48 hours in the case o f chickens. H5N1 is one strain of the HPAI virus. 2 The virus can improve its transmissibility among humans via two principal mechanisms. The first is reassortment, in which genetic material is exchanged between human and avian viruses during co-infection of a human being or a pig. Reassortment could result in a fully transmissible pandemic virus, announced by a sudden surge of cases with explosive spread. The second mechanism is a more gradual process of adaptive mutation, whereby the capability of the virus to bind to human cells increases during subsequent infections of humans. Adaptive mutation, expressed initially as small clusters of human cases with some evidence of human-to-human transmission, would probably give the world some time to take defensive action. 1

12 central to a coordinated and effective global response. Country strategies should be developed in accordance with country-specific needs and circumstances, and the strategies should be owned by the individual governments facing the threat of AHI. 4. Regional Dimension. In East Asia and the Pacific, cases of AH1 have occurred in a number of countries including Cambodia, China, Lao People's Democratic Republic, Indonesia, Japan, Korea, Malaysia, Myanmar, Thailand and Vietnam. Responses to the outbreaks in domestic and wild fowl have included screening, surveillance, precautions at the borders, movement control inside the country, culling programs, vaccination, enhancements in farm biosecurity, and changes to marketing and production practices. The World Organization for Animal Health (OIE) reports that, in 2004, over 60 million birds were destroyed and approximately 131 million were vaccinated. This response was the result of over 800 outbreaks with over 22 million cases (this number includes the number of fowl which have either become sick or have died from the disease), and over 4 million bird deaths attributed to AHI. On the human health side, since 2003, there have been 292 cases reported in Cambodia, China, Indonesia, Thailand and Vietnam, resulting in 195 deaths attributable to AHI. At the regional level, there are critical cross-country issues related to the implementation of AH1 plans, mainly in terms of coordination, the transmission and dissemination of information, and the sharing o f experiences and lessons. The country specific strategies have been adapted to the specific conditions in country. 2ountry and Sector Issues 5. Cambodia has achieved political and macroeconomic stability and, since 1993, has been experiencing rapid economic growth. Nevertheless, Cambodia's economy remains vulnerable and economic growth has not translated into widespread poverty reduction. With a GDP per capita of US$390 (in 2005) and social indicators showing limited progress since the 1960s, Cambodia remains one of the poorest countries in the world. About 35 percent of the population has expenditure levels below the national poverty line, with about 15percent living in extreme poverty. Poverty in Cambodia is overwhelmingly located outside Phnom Penh, with poverty incidence of more than 50 percent in the worst affected areas. 6. Cambodia was one of the first countries in Southeast Asia to experience AH1 infection. The first case was reported in December 2003, and the first wave of the outbreak during January to May 2004 had a severe impact on smallholders who raise the majority of the country's poultry under subsistence conditions and on small-scale commercial poultry farms. AH1 cases emerged again in late-2004 and early 2005, and four human cases (all of which were fatal) were reported in There have been a few confirmed outbreaks among chicken, ducks and fighting cocks in 2006, and these cases were quickly contained (about 2,500 birds were killed by disease or culling during the February 2006 outbreak); however, two additional human deaths were confirmed in In 2007, another human death was confirmed. The repeated outbreaks and associated loss of human life and livelihoods highlight the country's inadequate disease surveillance system, the limited capacity to control the disease and the persistence of infection in the region. 7. Cambodia is situated between two large poultry producing countries -- Vietnam and Thailand -- both of which have experienced far greater outbreaks o f AH1 and significant human infection. The region is a potential flashpoint for an expansion of avian influenza and the possible emergence of a human pandemic strain of influenza. The government is now focused on the development of an integrated AH1 control and human pandemic preparedness and response plan, and is working closely with the international community to build its capacity for disease surveillance, disease control and prevention, outbreak investigation and emergency response. 2

13 3. Rationale for World Bank involvement 8. A key justification for the Bank s involvement is the global public goods aspect of controlling AHI. There is also a national public goods perspective for countries to strengthen their veterinary services, disease surveillance and human health system as planned in this operation. The potential social and economic impacts of AH1 cannot be over-emphasized; this is an area where the Bank has extensive expertise and has been playing a key role. AH1 control programs require a multi-disciplinary approach to integrate technical, social, economic, political, policy and regulatory issues in addressing a complex problem. The Bank is well placed to draw on its knowledge-base concerning the multi-disciplinary approaches needed in the proposed operation, and to apply the evidence and lessons learned in various regions during emergency preparedness responses. The Bank can also be helpful in bringing together the relevant ministries, government agencies and the donor community, and in helping ensure high-level political coordination. 9. The Bank has been working with the World Health Organization (WHO), the Food and Agriculture Organization (FAO), the Animal Health International Organization (OLE), multilateral, bilateral and other partners in-country and at the international level to prepare the Global Program for Avian Influenza Control and Human Pandemic Preparedness and Response (GPAI). In Cambodia, the Bank has been working with the United Nations Development Program (UNDP; the convener of the donor round table), other agencies of the Unite Nations (UN) system (FAO, WHO, and UNICEF), the European Union (EU), and other partners to help the government assess and improve the National Comprehensive AHI Plan. The Bank can assist Cambodia in leveraging additional resources fi-om other bilateral and international agencies. In addition, the technical assistance provided by the Bank has been important in similar global or regional emergencies such as Human Immuno-Deficiency Virus (HIV), Acquired Immuno-Deficiency Syndrome (AIDS), Severe Acute Respiratory Syndrome (SARS), and post-disaster reconstruction. The Bank has a proven comparative advantage in providing integrator skills and multi-sectoral perspectives and in addressing the institutional dimensions of the response to such emergencies. It can also contribute extensive experience and skills in understanding and addressing the social and economic impact. 4. Country Eligibility under GPAI 10. The proposed project falls under the GPAI, approved by the Bank s Board of Directors on January 16, GPAI support is to be provided using the horizontal Adaptable Program Loan (APL) instrument and within a global coordination fi-amework. Under the global APL, individual countries may obtain separate loans, credits and grants, as they become available, to finance their own national projects up to the global aggregate limit of US$500 million. Since the GPAI is designed to provide emergency financing to participating countries to contain outbreaks of AH1 through early detection and rapid response measures, the country-specific operations will be processed under the Bank s emergency policy OPBP The GPAI will treat specific emergency response projects in each country as phases of a horizontal APL (similar approaches include the Multi-Country HIV/AIDS Programs for the African and Caribbean Regions). Cambodia clearly meets the eligibility criteria specified in the GPAI document, given that: (a) it is a country in endemic situation (with repeated outbreaks in poultry and six human deaths); (b) the National Comprehensive AHI Plan (see above paragraph), integrating both the animal and the human health sectoral plans, has been prepared and approved by government; and (c) the activities included under this project are fully consistent with the provisions and objectives of GPAI. 3

14 B. CAMBODIA: COMPREHENSIVE NATIONAL AHI PLAN 1. General Objectives 1 1. The overall objectives of the Royal Government of Cambodia s response to AH1 are to: 0 0 Control outbreaks of Avian Influenza in poultry and thus to limit the economic costs of the disease and the potential for its expansion into humans. Prevent transmission of Avian Influenza from birds to humans, and thus to limit the opportunities for mutation of the virus into one capable of human-to-human transmission. Minimize the risks and consequences of a pandemic by planning for such an outbreak, both in terms of human health services and o f the preparedness o f the society as a whole. 12. The human health planning is consistent with Responding to the avian influenza pandemic threat: recommended strategic actions prepared by WHO, and the pandemic planning done to date has followed the WHO Checklist for Influenza Pandemic Preparedness Planning. The animal health planning is consistent with The Global Strategy for the Progressive Control of Highly Pathogenic Avian Influenza (FAO, OIE in collaboration with WHO, March 2007) 2. Components of the National Plan 13. The Comprehensive National Plan on Avian and Human Influenza brings together the previously separate Animal and Human Health Plans and adds an Inter-Ministerial Cooperation Plan and a National AI Communications Strategy. The integrated National Plan: (a) builds on, and complements, existing plans; and (b) provides support to the two lead technical ministries while further clarifying the coordination roles of the government and other ministries in filling any remaining resource gaps and improving the effectiveness of overall prevention and response activities. This National Plan will be the single point of reference for avian and human influenza response in Cambodia. 14. Animal Health. The Ministry of Agriculture, Forestry and Fisheries (MAFF), with the support of FAO, has developed The National Strategy on Highly Pathogenic Avian Influenza Control and Eradication and The Action Plan for Implementing the Control of Avian Influenza ( ). These were approved by the Minister of MAFF in late December The key components of the Strategy and the Action Plan are: National capacities in animal disease control; National animal disease information system; Research and diagnostic capacity; Public awareness and education; and Rehabilitation and restructuring of the poultry sector. The Action Plan aims at controlling the H5N1 strain at the level of the farm gate by: enhancing biosecurity measures; strengthening the surveillance and monitoring capacities supported by enhanced laboratory and diagnostic capacities; strengthening the relevant legal framework on the control of the movement of live and dead birds; providing support for rehabilitation and restructuring of the poultry sector (where this is appropriate), including the up-grading of markets; and seeking greater partnerships with stakeholders, including Village Animal Health Workers (VAHWs) and competent NGOs. The Action Plan is for three years ( ) and was estimated to require US$15,885, Since this plan was prepared in 2005 there has been a marked increase in knowledge on the control and prevention of avian influenza (see for example the conclusions and recommendations 4

15 from the Technical Workshop in Rome 20073). Not only do countries need to be ready to respond to emergencies, they also need to examine their poultry production and marketing systems for potential high-risk practices. Where these are considered to present an unacceptable risk they should be modified or, if this is not possible for economic, social, environmental or technical reasons, then other interventions need to be considered to reduce the risk these represent. 16. The precise infection status of Cambodia is not known. Some surveillance studies have been and are being conducted but are hampered by difficulties in collecting sufficient quantities of samples over an extended period of time and reluctance on the part of poultry owners to allow birds to be sampled. However, based on experiences from neighboring countries, it is highly likely that infection is present in the domestic duck population even if only intermittently. The role of wild birds in the spread and maintenance of H5N1 HPAI viruses in Cambodia is not known. The epidemiology of avian influenza in Cambodia is also poorly understood. As most poultry are reared in small village flocks it is likely that most of these remain free from infection most of the time. The country s population of domestic ducks could potentially act as a reservoir o f infection. In addition there is some poorly regulated movement of poultry and poultry products from neighboring countries across Cambodia s long land borders. 17. Human Health. The Ministry of Health (MOH), with the support o f WHO, has developed the Action Plan for Avian Influenza in Cambodia, which was endorsed by the Minister of Health in December The plan contains five key action areas: Education and Communication; Surveillance; Investigation and Response; Case Management; Laboratory Support and Pandemic Preparedness Planning for the Health Sector. 18. The focus o f this sectoral plan is to address the short- to medium-term needs, using this opportunity to strengthen the overall systems for surveillance and response to emerging infectious diseases, including Avian Influenza. The specific activities requiring funding will include training of rapid response teams, stockpiling medicines, and training and simulation exercises and outbreak response funds for a rapid intervention should a pandemic emerge in Cambodia. 19. The Human Health Plan was estimated to require US$13,210,000 over a three year period. This includes detailed estimates for surveillance and response activities, case management and infection control as well as preliminary estimates for pandemic preparedness planning within the health sector. 20. Information, Education and Communications. The information, education and communications (IEC) component of the government s response requires coordination across both the technical ministries and the government agencies that are involved in information dissemination. During the Pandemic Alert Period, and even more so during any possible Pandemic Period, there must be clear, accurate and consistent communication messages, addressed to the general population, as well as specific targeted groups - chicken farmers, health workers, etc. 21. Messages and media for the general public- leaflets, press releases, and radio and TV spots - are being prepared now, for both the Pandemic Alert Periods and, on a contingency basis, for the possible Pandemic Period. UNICEF has been the agency working closely with MAFF and MOH to develop E C materials to meet the requirements o f the government. A complete IEC strategy and program is being developed with the assistance of the United Nations International Children s 3 Available at htt~:// e.rdf 5

16 Education Fund (UNICEF), which will allow improved coordination of communications/public awareness activities. The preliminary estimate of the cost of the program was US$2,250, Integrated Pandemic Preparedness. Recognizing that a pandemic outbreak is both likely and will affect Cambodia irrespective of its origin, the government is developing a pandemic preparedness component. Cambodia is drawing upon its response to the SARS outbreak in 2002 and 2003 in which numerous government agencies were mobilized to support surveillance, screening, communications, response and other activities. In the case of an emergence of a novel influenza virus, an even broader preparedness and response is likely to be required. In any case, it is clear that potential pandemic diseases are likely to be a continuing risk for which the government must prepare itself to ensure effective and efficient response to both threat and outbreaks. Under the emerging coordination structure, the Royal Government will draw upon its experience with natural disasters, animal and human health emergencies and the provisions already reflected in the Animal and Human Health Plans to specify and cost out an integrated, pandemic preparedness plan over the coming two months. A preliminary estimate of needs for pandemic preparedness was US$1,500,000, excluding those activities already covered under the Animal and Human Health Plans. The estimate for integrated pandemic planning will support business continuity planning and inter-ministerial facilitation and coordination. In addition, the government is developing simulations to estimate technical and financial needs under different pandemic scenarios which will be integrated into the plan. One of the key issues anticipated for future funding is to ensure an adequate food supply during a pandemic. 23. Program Management. The cost of the coordination and management of the implementation of the program, along with the costs of technical assistance, institutional building and training, as well as the enhancement of the legal and regulatory framework, has been estimated as US$4.3 million. 3. Institutional Aspects National Coordination. 24. On 22 January 2004, the RGC established the Inter-Ministerial Committee on the Prevention and Control of Avian Influenza chaired by the Minister of Agriculture, Forestry and Fisheries, with vice-chairs being the Minister of Health and the Minister of Commerce. MAFF issued a Prakas for each province to form a Multisectoral Provincial Committee on Avian Influenza. This committee is chaired by the Governor of each province and has representatives from various sectors o f government, including agriculture and health. At a national level there is also a Joint Technical Working Group on Avian Influenza, which meets every week to coordinate and discuss technical issues. Under this structure, the government has engaged with donors and NGOs with strong support from the UN system, to develop plans and coordinate donor-funded, immediate activities such as strengthening surveillance systems, laboratory testing, culling and planning. Institutional Arrangements for Pandemic Preparedness and Response. 25. There is a consensus acknowledgement that a human pandemic will involve many sectors and interests beyond those represented by the line ministries of health and agriculture. Such an event could significantly affect travel, trade, employment and the economy, security and social order, and even basic services such as utilities, and food and water supply. For this reason, and also because there are cross-cutting issues in the animal and human health response plans and a need for a harmonized emergency response, the need for high-level governmental coordination is 6

17 clearly recognized. The government has decided to assign the overall coordination responsibility of the activities required to respond in the event of a pandemic (Phase VI) to the National Committee for Disaster Management (NCDM). NCDM was originally established by a sub-decree (No. 54 ANKR-BK) signed by the Prime Minister in 1995, and later amended in The Prime Minister is the PresidendChairman of NCDM, and NCDM is integrated through the inclusion of the Ministers in charge o f all ministries, the Provincial Governors and representatives o f the Armed Forces, National Police and Civil Aviation Authority. 4. Financing Requirements 26. Cost Estimates. At the time of preparation, it was estimated that the implementation of the proposed activities would require US$37,090,500. Funding requirements have been estimated with detailed analysis for animal and human health activities for a three-year period, including provisions for limited stockpiling of equipment and supplies likely to be required in the event of a significant outbreak. However, as indicated in the plans, additional contingencies will have to be anticipated in the event of a major outbreak or pandemic. 27. Financing Commitments and Gaps. As summarized below, the RGC has received financing commitments for implementation during the 2006 to 2008 period of about US$7.8 million, including: US$5.9 million for the animal health sector; US$1.1 million for the human health sector; and about US$0.75 million committed by UNICEF for integrated communication. Therefore, the RGC estimated an overall financing gap o f around US$29.3 million for the three year implementation period, in relation to the original cost estimates at the time of preparation of the Plan. The proposed Bank-financed Avian and Human Influenza Project will cover US$11 million of this estimated gap (about 38 percent) and will include all the core activities that are considered essential for the achievement of the basic objectives of strengthening the country s ability to carry out effective surveillance and responding to an eventual outbreak in an efficient manner. The remaining gap could be even reduced further if new commitments from international donors materialize. Sections of the Plan Financing Approved or Committed Finance Gap A. ANIMAL HEALTH: Control and 7

18 C. PROJECT DESCRIPTION 1. Project Development Objective 28. Consistent with the GPAI, the project s overall development objective is to support the implementation of the Cambodia Comprehensive AH1 National Plan, which is designed to minimize the threat posed to humans and the poultry sector by AH1 infection in Cambodia, and to prepare for, control, and respond if necessary to a human influenza pandemic. More specifically, the project is expected to provide direct support to the implementation of the National Comprehensive AH1 Plan to produce the following outcomes: (a) to contain the spread of the disease, reducing losses in the livelihoods of commercial and backyard poultry growers and damages to the poultry industry and diminishing the viral load in the environment; (b) to prevent or limit human morbidity and mortality by stemming opportunities for human infection and strengthening curative care capacity; and (c) to prevent or curtail macroeconomic disruption and losses by reducing the probability of a human pandemic and improving emergency preparedness and response. 2. Project Components 29. The project will finance activities fully consistent with the objectives and the description of the National Comprehensive Plan, with a focus on items not already covered by other sources of funding (technical and financial gaps). The project will include three components that are detailed in Appendix 2, as summarized below: 30. Component A -- Animal Health Systems (estimated cost: SDR 2.75 million and US$1.45 million; total of US$5.80 million equivalent). The objective of the component is to minimize the levels of infection with H5N1 HPAI viruses in Cambodia4 and it will be achieved through six subcomponents. The first subcomponent will strengthen veterinary services from the central to the village level to enhance the capacity to prevent, recognize and respond to avian influenza and other emergency animal diseases. This will be achieved through the strengthening and consolidation of training resources, reviews of training needs and curricula for VAHW training, enhanced reporting by trained VAHWs to District Veterinary Services, provision of resources to support disease responses for district and provincial level veterinary services, and development o f appropriate animal health laws. The second subcomponent will provide training in emergency vaccination and necessary resources to implement emergency responses. Some additional epidemiological studies, including studies in wild birds, will also be conducted under this subcomponent. The third subcomponent will review high-risk practices in production and marketing that facilitate the persistence and transmission of infection and implement appropriate measures to reduce these risks. The fourth subcomponent will include some additional epidemiological studies, including studies in wild birds, and will strengthen existing animal health IEC programs. The fifth subcomponent will enhance pandemic preparedness response for animal health staff, and the sixth subcomponent will provide support for the management of the component. 4 The ultimate goal is eradication but, even if achieved, this is unlikely to be sustainable as long as infection persists in the region and illegal or uncontrolled cross border movement of poultry and poultry products occurs. Minimizing the levels of infection in poultry will reduce the risk of human infection and protect the poultry sector and the livelihoods of many smallholders and poor farm households. Additionally, upgrading the animal health system will improve livestock sector productivity with benefits for commercial and backyard producers alike. 8

19 31. Component B - Human Health Systems (estimated cost: SDR 670,000 and US$2.44 million; total of US$3.50 million equivalent). The objective of the component is to prevent the emergence of a human pandemic in Cambodia through the rapid identification and effective management of human cases. Strengthening public health systems will enhance national pandemic preparedness and help to reduce the loss of life that would result from a human pandemic caused by influenza. The first subcomponent will focus on the training of health care workers and the development of materials for use by health care providers and Village Health Volunteers (VHV). To improve surveillance, investigation and response, the second subcomponent will support the training of Provincial Rapid Response Teams; the operating costs associated with surveillance, investigation and response; and the transportation for those undertaking both activities in the field, as well as supervision costs by each level. International experts will be hired to identify activities necessary to ensure compliance with the International Health Regulations, and these findings will be disseminated. To support case management and infection control, the third subcomponent will finance the procurement and distribution of medicine, medical equipment and Personal Protection Equipment (PPE). Clinical training on case management and infection control will be supported, as well as the identification of and support to activities necessary to ensure appropriate health care waste management and infection control. The fourth subcomponent will support laboratory activities through the development of a national laboratory strategy and continuous education and refresher training for laboratory staff on-site (using international trainers) or at the local level using existing trainers in the country; and the provision of equipment, specimen collection kits, laboratory consumables and reagents, and transport for specimen transport inside Cambodia, as well as shipment abroad to WHO reference laboratories. Activities associated with pandemic preparedness for the health sector will be supported under subcomponent 5, and include the preparation and dissemination of the plan, training provincial level staff to prepare their plans, and simulation exercises. Subcomponent 6 will support activities on rapid containment of an outbreak with a novel influenza virus that has the potential to create pandemic influenza: case management, infection control, isolatiodquarantine, and equipment and supplies. Activities under this subcomponent include rapid containment training curriculum development, workshops for rapid containment plan implementation, and rapid containment training for province, district and health centedhospital staff, border quarantine staff, and the Rapid Response Team (FWT), as well as for military, police and local authorities. The subcomponent 7 consists of the support necessary for overall implementation of the component (including staff travel costs, transport, operation and maintenance costs, and consumables). 32. Component C - Inter-ministerial Cooperation for Pandemic Preparedness and Project Coordination (estimated cost: SDR 383,000 and US$1.11 million; total of US$1.70 million equivalent). The objective of the component is to strengthen Cambodia s capacity to quickly and efficiently mobilize a coordinated multisectoral and society-wide response to an influenza pandemic. Strengthening the coordinated response capacity for an influenza pandemic will also improve the effectiveness of Cambodia s response to floods, droughts, and other natural disasters. This objective will be achieved through five subcomponents: (a) under the first subcomponent the NCDM s current Terms of Reference will be modified to better include interministerial cooperation for pandemic influenza preparedness, and NCDM s capacity to oversee this cooperation will be strengthened through training, staffing and other measures; (b) in the second subcomponent, NCDM will prepare and test a Pandemic Preparedness, Response, and Recovery Program (PPRRP); (c) in the third subcomponent, a NCDM emergency management information system (MIS) and an M&E system (for the overall national PPRRP) will be designed, developed and established; (d) under the fourth subcomponent, pandemic preparedness, response and recovery activities will be integrated into the existing Community Based Disaster Risk Reduction Programs (CBDRM); and (e) the fifth subcomponent will comprise support for the overall implementation of the component. Since NCDM will take overall responsibility for overseeing 9

20 and coordinating institutional and implementation arrangements for the project as a whole (including overall project coordination, ensuring linkages across relevant agencies and with international partners, and for guiding and monitoring project implementation at the central level), the fifth subcomponent will also provide support for these important coordination functions. 3. Lessons Learned and Reflected in the Project Design. 33. Previous World BanWIDA-supported emergency recovery projects provide a number of relevant lessons for project design. Lessons learned of particular relevance for an emergency AH1 project include: (a) emergency projects should avoid policy conditionality; (b) project design must be simple and take into account a realistic assessment of the Borrower s capacity and other stakeholders capacity; (c) a speedy appraisal and approval are crucial to provide a prompt response and a substantial contribution to project success; (d) procurement arrangements need to be flexible and should be finalized at an early stage; and (e) realistic assessments should be made of counterparts absorption capacity, as well as of the effective communications and coordination mechanisms among all relevant stakeholders. 34. The experience gained through the implementation of other emergency projects provides additional important lessons. These projects include the Vietnam Avian Influenza Emergency Recovery Project, projects in response to the SARS epidemic, and projects in response to the HIV/AIDS epidemic. These key additional lessons learned include: Preparation o f a good quality national strategy is a key factor. For implementation arrangements, it is important to have a coordination structure empowered with multisectoral responsibilities, for instance responding directly to the Prime Minister s Office, and to have full-time project coordinators to implement activities in a crisis. Strengthening the technical, scientific and operational capacity of the relevant participating agencies is very important. It is crucial to raise awareness in the public and private sectors as early as possible, and to strengthen effective coordination mechanisms for the implementation of the necessary technical responses, involving the government, the donor community, the private sector and civil society. Good quality national surveillance is clearly vital in preventing the spread of diseases. There is a need for high-level and sustained political commitment and leadership. A comprehensive multi-sectoral approach of prevention, treatment, care and support services has the best likelihood of success. While emphasis must still be placed on prevention as the most cost-effective means of managing the AI threat, programs should seek to address the whole spectrum of prevention, treatment, care and support services. D. IMPLEMENTATION 1. Partnership Arrangements 35. Effective and suitable partnership arrangements for this project have been developed in Cambodia with the international technical agencies as well as with bilateral donor agencies currently providing assistance to the country, building on productive collaborative arrangements 10

21 developed over time in both the agricultural and health sectors under previous projects. During project preparation and appraisal, close consultations with local staff of the multilateral and bilateral donors represented in Cambodia was maintained, mainly with the agencies involved in supporting the implementation of the National Plan (i.e., UNDP, FAO, WHO, and UNICEF, EU, Agence Franqaise de Ddveloppement, USAID and AusAID). Round tables were organized prior to and during the appraisal mission to brief these partners on the intended program of working with the government to strengthen its National Comprehensive Plan, to ascertain their interest in providing financial andor technical support for the project and to coordinate the activities to be supported by each agency to improve overall effectiveness of the combined actions and programs. 36. The Government of Japan has already approved a PHRD Co-financing Grant (PHRD Grant) of US$3 million for the project. Some o f the major donors (e.g., UNDP, FAO, WHO, GTZ, JapadJICA, USAID and AusAID) have already approved, or are planning to approve shortly, technical assistance projects to complement and to help jump-start the activities proposed under the National Plan that are consistent with this project. A multi-donor trust fund, the AH1 Facility, has been established to provide financial support for HPAI preparedness to individual countries. This facility is managed by the World Bank, and a total amount of US$2 million has been approved to cofinance the proposed project. 2. Institutional and Implementation Arrangements 37. Implementing Agencies. The government has decided that implementation of the project will be the responsibility of three Implementing Agencies (IAs), as follows: Component A: The Animal Health component will be implemented by the Department of Animal Health and Production (DAHP) o f MAFF through its existing structure and with the support o f a small unit in charge of the coordination function for the component. This unit will be staffed with specialists in financial management, procurement and M&E, as well as external technical advisors. It is expected that MAFF will sign a service agreement with FA0 under which this international agency will provide: (a) the institutional strengthening needed for the implementation of the component; and (b) technical assistance in key areas, its broad international experience in animal health in general, as well as in the wide-world efforts being implemented to control the spread of avian influenza. FA0 is recognized as one of the leading technical agencies in the implementation of the animal health strategy to stop the spread of H5N1. Component B: The Human Health component will be implemented by MOH through the existing PIU in charge of the existing Health Sector Support Project (HSSP). This PIU already has sufficient human resources and expertise to assume these new responsibilities. However, several additional consultants will be hired to strengthen its institutional capacity to implement this component (financial management and accounting, administration). In addition, it is expected that MOH will sign a Service Agreement with WHO to receive technical assistance and capacity building to implement the component. WHO is an internationally recognized specialized agency of the UN system that is supporting the response to the avian influenza threat in many countries around the world and is in charge of supporting key areas of the National Comprehensive Plan in Cambodia. Component C: NCDM, through its General Secretariat, will be in charge o f the Inter-Ministerial Coordination for Pandemic Preparedness and will be responsible for the overall coordination and management o f the project. The current staff of the General Secretariat will be strengthened by consultants in key areas, mainly financial management, procurement, human resources and M&E. Similarly to the other components, it is expected that NCDM will sign a Service Agreement with 11

22 an agency o f the UN System to receive technical assistance during implementation. This Service Agreement will extend and complement the current capacity building program being executed by the UN System. 38. Under this implementation approach, the RGC (as the Recipient of the grant financing) will enter into a Financing Agreement with the Bank for the IDA funds and into corresponding Grant Agreements for the grants from the PHRD and the AH1 Facility. These institutional implementation arrangements will contribute to fast and cost-effective implementation, providing assurances that the surveillance and response systems are fully operational in a short period and, therefore, able to produce an effective response in the event of an outbreak of the disease in poultry or a large number of human cases. For the implementation of these activities, the funds from the three sources (IDA, PHRD and AH1 Facility) will be advanced by the Bank directly to the Designated Accounts opened by each IA (one for MAFF, and two for MOH and NCDM), in a manner acceptable to IDA. 39. Each IA will prepare and submit to NCDM, as the agency in charge of overall coordination: (a) a Project Implementation Plan (PIP) for all project activities included in its component; (b) annual work plans (with budgets) for each calendar year; (c) annual physical progress reports and financial statements covering the preceding calendar year; and (d) Interim Financial Reports (IFRs) for each quarter. From the IFRs for the 4* quarter, NCDM will prepare the annual financial statements for the entire project and these will be audited by independent auditors under Terms of Reference acceptable to IDA. 40. Overall Project Coordination and Management. Overall responsibility for overseeing and coordinating institutional and implementation arrangements will be vested with the NCDM. NDCM was originally established by a sub-decree (No. 54 ANKR-BK) signed by the Prime Minister in 1995, and later amended in The Prime Minister is the PresidenUChairman of NCDM, and this Committee is integrated by the Ministers in charge of all ministries, the Provincial Governors and representatives of the Armed Forces and National Police. 41. In addition to its responsibilities as implementing agency for Component C, NCDM will be responsible for overall project coordination and management, ensuring linkages across relevant agencies and with international partners, and for guiding and monitoring project implementation at the central level; it will be IDA S main counterpart during project implementation. For this purpose, NCDM will rely on its existing structure, using its General Secretariat as the main unit in charge. Its Secretary General and Deputy Secretary General will serve as Project Director and Project Manager, respectively. To perform these functions, NCDM will recruit consultants to strengthen its capacity, mainly in the areas of general administration, financial management, procurement, M&E, training and human resources. A consultant service agreement is expected to be entered into between NCDM and an agency of the UN System to contribute to the institutional strengthening of NCDM to perform this function. 42. The main responsibilities o f NCDM as Project Coordination Agency will be: 0 The preparation of the Project Environmental Management Plan (EMP) and the Ethnic Minorities Planning Framework (EMPF), both satisfactory to IDA, to be approved and adopted by the RGC, as well as properly disclosed in the country. 0 The preparation of the PIP from inputs from the respective IAs, ensuring its adoption by the RGC and monitoring its implementation, suggesting adjustments when needed; 12

23 The compilation of the Annual Work Plans (AWPs) prepared by each IA into an AWP for the whole project, ensuring consistency with national policies and the overall strategy for avian influenza, as well as with the available resources. This AWP will be submitted to IDA every year, not later than September 30. The establishment and maintenance o f an M&E System for the entire project, making sure that the I As are fully capable of implementing the systems for each component, which will be essential inputs to this system. Assessing the project s progress status, identifying constraints and limitations, as well as suggesting ways to improve project performance and realigning activities accordingly. Acting as IDA S main counterpart for project implementation, supervision and evaluation, as well as for other donors and international partners for matters related to its implementation. Based on inputs from the IAs, the preparation and submission to IDA o f (a) annual physical progress reports and financial statements, not later than April 30 of each year, covering the preceding calendar year; (b) IFRs for each quarter, not later than 45 days after the end of each quarter; (c) annual financial statements for the entire project, based on the IFRs for the 4* quarter received from each IA; (d) annual auditing reports of the annual financial statements and accounts consolidated for the project, as well as the corresponding management letters, will have to be submitted to IDA by independent auditors under Terms of Reference acceptable to IDA within six months of the end of each financial year; (e) a Mid-Tern Progress Report; and (f) a final Borrower s Implementation Completion Report, to be sent to IDA not later than two months after the closing date o f the project. 3. Monitoring and Evaluation (M&E) of Outcomes and Results 43. The NCDM will be responsible for the establishment and maintenance of the M&E system for the overall project. Within this overall framework, each IA will be responsible for the establishment and operationalization of the M&E system for its respective project component. Depending on the specific situation in each case, these activities could be carried out by the regular staff of the IAs (with training and technical assistance provided by the project), or by specialized agencies or institutes contracted for this purpose under the project. In the case of the Animal Health component, M&E will be supported by the appointment of regionally based project managers who will conduct the regular monitoring of project activities along with a central M&E officer in the Animal Health component project management team. 44. Monitoring progress in implementation and towards the achievement of the intended objectives entails a process o f continual and systematic review of the project activities. M&E is intended to: (a) to measure input, output and outcome indicators; (b) to provide regular and up-todate information on progress toward achieving the intended results and facilitate reporting to the government and IDA; (c) to alert the government authorities and the Bank to actual or potential problems in implementation so that adjustments can be made; and (iv) to determine whether the relevant stakeholders are responding as expected and intended. 45. The findings of relevant M&E activities will be reflected in quarterly and annual progress reports. The progress reports will cover the implementation of activities related to civil works, institutional activities, training and studies, performance indicators, and IFRs. They also will cover issues identified during implementation and the strategies and actions proposed to be taken to resolve such issues that affect progress. The fourth quarterly report of each year will be an annual report, covering progress during the past year. In addition, a Mid-Term Progress Report will be 13

24 prepared approximately half-way through implementation and will form one o f the inputs into the Mid-Term Review. This Review will provide an opportunity for joint review (by the government, implementers, partners and donordfinanciers) review of the experiences and lessons to-date and for discussion of adjustments to the design, implementation schedule and expected outcome/results, if necessary. A Recipient s Implementation Completion Report will be prepared by the I As and sent to IDA. Based on this report, IDA will prepare an Implementation Completion and Results Report within six months of the closing date of the project. 4. Sustainability, Critical Risks and Possible Controversial Aspects 46. Sustainability. Critical to the project s sustainability will be the ownership of this initiative by the stakeholders, coupled with strong political support and an adequate flow of financial resources to cany out project activities. Institutional sustainability will be ensured by: (a) the strengthening of programs to maintain public awareness of the threat of HPAI and other rapidly spreading infectious diseases; (b) the sustained surveillance and prevention and control activities, particularly in high-risk regions; (c) the strengthened country capacity to manage at national and local levels the risk factors associated with the spread of HPAI and other infectious diseases; and (c) the effectiveness of programs to control the spread of HPAI from birds to the human population. Critical Risks From Outputs to Objective Decline in political commitment to addressing HPAI and the threat of a Global Influenza Pandemic and other infectious diseases as a iational priority. 3overnment agencies do not have sufficient mthority, leadership and capacity to take a leading role in avian influenza prevention and :ontrol. [ntervention activities not effective in :ontaining the spread of avian influenza from 9irds to the human population. Rating s s s clontinuing support for inter-sectoral :ollaboration through information exchanges md dialogue and the operationalization of the Vational Comprehensive Plan and the Pandemic Preparedness Plan, which are to provide general 3olicies and guidance for avian influenza :ontrol. 4ssistance from the UN System Agencies through service contracts will strengthen government s capacity in management, :oordination and specific technical areas. 4ctivities will strengthen response capacity in?riority areas in the short and medium term and will lay the foundation for a more broadly based strategy, including: Comprehensive awareness and communication campaigns, critical to containing the spread of an influenza pandemic. Choosing well designed, cost-effective interventions. 0 Interventions phased and carehlly monitored, allowing for modifications and redesign as needed. Service delivery deconcentrated with the maximum use of local governments and civil society. 0 Good M&E to flag emerging issues. 14

25 [nadequacy or lack of multi-sectoral participation (ineffective coordination) High-level central commitment does not translate into action on the ground. Lack of independent internal audit function From Components to Outputs Controlling the spread of the pandemic may expose the government to criticism concerning the curtailment of civil rights due to the adoption of quarantines and other related measures. Lack of laboratory capacity for prompt diagnosis and surveillance and of sufficient quantities of drugs and other medical inputs needed to address the needs of the general population during a pandemic. Inadequate institutional capacity to manage the project. Financial resources not accessible in a timely manner; weak procurement management. Lack of timely and predictable access to expert advice and technical support. Inadequate capacity for planned surveillance, surveys and M&E. Lack of a comprehensive system to compensate farmers for culled infected birds makes more difficult the detection of an outbreak. Overall Risk Rating: M S S S M M M S S The IAs will coordinate through the Interministerial Committee on the Prevention and Control of AI and, for pandemic preparedness, with NCDM. Implementation mechanisms explicitly address the link between the required centralized decision-making (the principle of direct chain of command ) with the needed local-level implementation; communication strategies will include local-level implementing actors as targets; capacity building includes periphery. Robust internal audit function by each IA, plus external independent auditing financed by the project, both providing reports to government and co-financiers. The project will support advocacy and coalition building to sensitize key groups including policy makers and the media. This will be complemented by carefully designed mass communication campaigns to build support for the project among the population. Project activities will be coordinated with efforts undertaken by WHO (and other international organizations) that have established an international anti-viral stockpile with donations fiom the pharmaceutical industry. Capacity building and institutional development is one of the project s key objectives. Procurement and financial management arrangements will be handled by experienced staff or consultants from the IAs. Project activities have been designed with assistance from leading specialized international agencies, some of which have long experience on avian influenza issues (e.g., FAO, WHO, UNICEF, etc.), and their assistance will be always available during implementation. IAs will be responsible for the design and operationalization of surveillance, surveys, and M&E. Institutional capacity building and strengthening of the monitoring and surveillance capacity, together with the planned communication campaigns and the increased farmer awareness about the long-term effects of a larger outbreak, mitinate these risks. Risk Rating - H (High Risk), S (Substantial Risk), M (Modest Risk), N (Negligible or Low Risk) 15

26 5. Grant Conditions and Covenants 47. Conditions of Effectiveness. These will include: (a) the legal agreements regarding the cofinancing resources from the PHRD Grant and the AH1 Facility are signed with the Recipient and all the conditions for their effectiveness (other than the effectiveness o f the IDA Grant) have been met; (b) each IA has hired the key staff responsible for project coordination and management, as required for their components (including government officials responsible for the coordination of each component, as well as for financial management and procurement), in a manner satisfactory to IDA; and (c) the Annual Work Program for the first year of project implementation (2008) has been prepared by the Recipient and it is acceptable to IDA. 48. Implementation Covenants. The main nonstandard covenants include: (a) by July 3 1, 2008, the project s Environmental Management Plan (EMP) and the Ethnic Minorities Planning Framework (EMPF), both satisfactory to IDA, have been approved by the Recipient, and have been properly disclosed in the country; (b) by September 30, 2008, the Project Implementation Plan (PIP), satisfactory to IDA, has been prepared by NCDM in coordination with the IAs, including arrangements for implementation, procurement, accounting, financial management, auditing procedures and M&E and reporting arrangements; (c) MAFF and NCDM will establish complete financial management systems acceptable to IDA, including the establishment of computerized accounting software, not later than September 30, 2008; (d) annual work plans (with budgets) for each calendar year, will be presented not later than 30 of September of the previous year for discussion with IDA; (e) annual physical progress reports and financial statements, not later than April 30 o f each year and covering the preceding calendar year, will be presented to IDA for discussions and approval; (f) IFRs for each quarter, not later than 45 days after the end of the quarter, will be presented to IDA; (g) a Mid-Term Progress and Assessment Report will be presented by NCDM, in collaboration with the IAs, for discussion with IDA, at the end of the second year of implementation; and (h) annual audits of the financial statements for the entire project (together with the management letter) will be submitted to IDA by independent auditors, under Terms of Reference acceptable to IDA, within six months of the end of each financial year. In addition, the Recipient shall ensure that the project is carried out in accordance with the provisions of the Good Governance Framework (Appendix lo), and the Anti-Corruption Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants, dated October 15, E. APPRAISAL SUMMARY 1. Economic and Financial Analyses 49. The project and Cambodia s National Comprehensive Plan will reduce the risk of AH1 outbreaks among poultry and humans. While it is possible to undertake a with and without project comparison o f the social benefits and costs of the Plan, this analysis is complicated by uncertainties about the numbers of humans and poultry that might be affected by the disease and the efficacy of the control measures employed. The extent o f protection achieved will depend upon the efficacy of the prevention, containment and treatment measures undertaken. For the purposes o f costhenefit ratio analysis, protection rates varying from 30 to 100 percent for humans have been assumed. The likely impact of an AH1 pandemic on unprotected humans (that is, the without project situation) was derived using WHO estimates of human-to-human transmission: (a) 30 percent of unprotected humans are likely to be affected; (b) 10 percent of those will require hospitalization; and (c) 1.5 percent o f all human cases will be fatal. The costs of implementing the National Comprehensive Plan were assumed to remain unchanged for each scenario. 16

27 50. Major economic outcomes were modeled based on protection rates of 30, 80 and 100 percent (see Appendix 8). The scenario o f 80 percent protection results in an estimated 50,400 human lives saved and 420,000 hospitalizations averted. With the most conservative assumptions, the protection rate of 30 percent saves 18,900 lives. The net economic effect is massive, and ranges from benefits of between US70.6 million (30 percent protection rate) to US$165.1 million (80 percent protection rate). The costbenefit ratios for these two scenarios, which range from 2.2 to 5.1, are strongly favorable. 51. While the quantification of indirect benefits is problematic, some of these indirect benefits may be as important as those estimated in the costbenefit analysis. For example, a considerable benefit will be the reduction or avoidance of shocks to the service sectors (including tourism, mass transportation, and retail sales). Other important benefits of the National Comprehensive Plan include the strengthening of the Ministries and other units involved in natural disaster avoidance and response. 2. Technical 52. Animal Health. A balanced combination of appropriate disease control and preventive options, tailored to the specific characteristics of Cambodia, is essential for the achievement o f the project objectives. Successful implementation of both of these elements in the project depends on a properly functioning veterinary service that has well developed links to poultry producers and the poultry trade. In many cases, these will have to be built up during the life of the project. The overall national disease control strategy has taken into consideration the range of epidemiological scenarios that exist or may arise in Cambodia, as well as the different poultry production systems in the country and different levels of infection. 53. The implementation of the project raises important technical issues and presents substantial challenges. Key issues include the following: The capacity of the public and private veterinary services. The veterinary services at present are inadequately resourced and trained to deal with HPAI and other emergency diseases This is evident across the entire range of critical capabilities: surveillance and diagnostic capacity for early detection and reporting of outbreaks, monitoring disease, rapid response and implementation of the required control measures within and around outbreak sites (including enforcement capacity), and essential investigations to understand how the disease developed. This will be addressed progressively in this project. Adequacy of the regulatory and incentive framework. The current legal and regulatory framework is incomplete, not fully consistent internally, and in many instances poorly aligned with actual physical, technical and staff capacities on the ground. Amendments will be needed to the Veterinary Law, to various decrees governing emergency animal diseases, and to regulations concerning institutional responsibilities. Disease prevention measures. Measures to prevent the spread of the virus from infected premises and measures to exclude the virus from uninfected locations are essential, but have often proven to be difficult to implement effectively, in part because o f the nature of the traditional production and marketing systems which lead to extensive poorly-regulated poultry movements. Poor coordination among public agencies and weak linkages with the private sector. Ineffective coordination among ministries and public agencies, and weak linkages with the private sector (especially the owners of poultry), are major impediments to long-term 17

28 planning for infectious disease control that need to be addressed during the life of the project. Coordination within the livestock sector. There are many active projects sponsored by agencies in the livestock sector involved in HPAI control andor sector development. Limited coordination amongst these agencies and projects represents a potential impediment to development of the sector and long-term planning for effective and efficient infectious disease control. The project will seek to play a strategic role in coordination and will develop improved coordination arrangements and mechanisms with other agencies, especially FAO. 54. Human Health. According to WHO, the current epidemiological situation of avian influenza corresponds to a Pandemic Alert Period, Phase 3, with human infection(s) with a new sub-type, but no human-to-human spread or, at most, rare instances of spread by close contact. Compared with previous influenza pandemics that took the world by surprise and gave health services little time to prepare for the abrupt increases in cases and deaths that characterized these events, the present situation is markedly different for several reasons: (a) the world has been warned in advance; (b) this advance warning has brought an unprecedented opportunity to prepare for a pandemic and develop ways to mitigate its effect; (c) apart fkom stimulating national preparedness activities, the present situation has opened an important opportunity for international intervention aimed at delaying the emergence of a pandemic virus or forestalling its international spread. 55. The risk to human health posed by the recent avian influenza outbreaks has led to the preparation of a Global Technical Framework (as part of the GPAI) to guide action against an increasing pandemic threat. It recognizes that there are areas that require further development and that specific actions to be included and supported under country projects need to reflect the epidemiological conditions, institutional capacity, needs and priorities of the specific country. In case a true human AH1 pandemic and emergency were to develop, separate procedures may be decided upon, especially with regard to sole-source financing of anti-virals and AH1 vaccines. 56. Not knowing which influenza virus strain is going to cause the next pandemic makes planning for it very challenging. The likely impact of a pandemic depends upon characteristics o f the virus such as its infectivity, attack rates in different age groups (i.e., the proportion of the population infected for each age group) and the severity of disease it causes. The three pandemics of the 20th century demonstrate the variation in mortality, severity of illness and patterns of spread that can occur. 57. A critical element of pre-pandemic planning, however, is ensuring that the building blocks are in place ahead of an actual pandemic threat. The two major strategies to be supported under the GPAI are technically sound. The first focuses on containment measures to prevent transmission and spread of the virus through social distancing measures, judicious use of anti-viral medication, and strengthening of surveillance and public health laboratory systems to ensure that capacity and capability are in place to allow early detection of virus sub-types and rapid and accurate identification of emerging virus sub-types are in place. The second emphasizes the maintenance of essential medical services and the mobilization of international emergency health care and staffing for low-income and low-capacity situations if there is an explosive spread of the virus within the general population and containment is no longer possible, coupled with preparedness for pandemic vaccination development and administration. In addition, support is considered for ensuring that appropriate decision-making bodies are in place and have the necessary expertise and authority to make decisions quickly and effectively. 18

29 58. The project will support short- and longer-term actions in the public health field, while ensuring that an appropriate balance i s struck between the two. The project is fully consistent with WHO S recommendations. The aim of the proposed interventions is to minimize the morbidity and mortality associated with a pandemic event. 3. Financial Management (see Appendix 4). 59. Financial management (FM) arrangements will be carried out by each IA for its respective component. Financial management capacity assessments were carried out at each IA in September 2007; the risks identified need to be addressed by remedial measures and action plans were developed to ensure that the project s financial management arrangements meet the Bank s minimum requirements. 60. The inherent financial management (FM) risk to the project from the country environment is assessed as high because of the weak financial control environment and systems of the public sector. The recommendations of the Cambodian fiduciary review have been taken into account in designing the FM arrangements for the project, including the disclosure of project information. The risks have been mitigated by: (a) annual activities planning and budgeting; (b) the establishment of a separate computerized accounting and financial management system for the project; (c) the sound accounting control and procedures to be adopted; (d) the appointment of an adequate number of suitably qualified staff to manage implementation; (e) regular financial reporting to MEF and IDA; (f) internal audit review of the project activities and financial operations; and (g) annual financial audits and specific purpose reviews by independent auditors. Most of these project specific arrangements are already operational, and an FM Action Plan (as set out in Annex 4) has been developed and agreed to address outstanding issues. Taking into account the risk mitigation measures proposed under the project, the FM risk rating is considered moderate. 4. Procurement (see Appendix 5). 5. Social 61. Procurement for the project will be carried out in accordance with the World Bank s Procurement and Consultant Guidelines (dated May 2004, revised October 2006) and the provisions stipulated in the Legal Agreements (Financing and Grant Agreements), including the agreed Procurement Plans. To address the weak procurement capacity of the project IAs, and consistent with the government s decision agreed by the Bank to require an International Procurement Agent (PA) for all Bank-financed projects in Cambodia, procurement under the project will be carried out by the PA on behalf of the project implementing agencies, with the exception of procurement agreed with the Bank to be undertaken through the Single Source Selection and Procurement from United Nations Agencies methods, which will be carried out by the project IAs themselves. To mitigate the broader fiduciary risks resulting from the weak governance environment, including procurement, in the country, extensive measures for improving governance in project implementation and increasing transparency and accountability in the procurement process have been incorporated in the project s design. Details are provided in Appendix 5, and the Good Governance Framework agreed with the three IAs is included as Appendix The project is expected to contribute to minimizing the impact of outbreaks and a human pandemic by having in place a surveillance and response system to minimize the potential impact of an unchecked outbreak in the avian population. Ensuring that there is a proper response to any outbreak in animals (including poultry) should help to ameliorate the potential of humans 19

30 contracting the disease and possibly passing it on to others. The project s support to improving the surveillance, conducting public awareness campaigns (including translation of messages into ethnic languages), and having in place a preparedness plan, should help to prevent or, in the event of a pandemic, reduce the impact on the population. The integrated surveillance system to be supported by the project will reinforce the multi-sectoral response necessary to this threat. 6. Environmental and Social Safeguard Policies 63. The project is not expected to have any large-scale, significant or irreversible environmental impacts as activities focus largely on public sector capacity building and ensuring readiness for tackling outbreaks of AH1 in domestic poultry as well as preventing or reducing possible human infections by strengthening emergency preparedness and response. The project design incorporates other beneficial measures such as improved biosecurity in farms and live markets, and control of poultry movement within and between countries. The preventive activities (funding of facilities, equipment, laboratories, procedures, and training programs), aimed at improving the effectiveness and safety over the existing AH1 practices, will have positive human health and environmental impacts. Among the Bank s safeguards policies, only the Environmental Assessment (OP4.0 1) and Indigenous Peoples (OP4.10) are triggered. The project design incorporates the necessary mitigation measures for the potentially adverse impacts associated with the activities involved in responding to AH1 outbreaks. A draft EMP has already been prepared (see Appendix 6). Immediately after effectiveness, the I As will engage specialized consultants to: (a) complete the EMP; and (b) prepare an EMPF. The EMP and the EMPF will be revised after consultation with various stakeholders (government agencies, commercial poultry associations, mass organizations, ethnic minorities groups and NGOs) and, once found acceptable to IDA, will be appropriately disclosed in Cambodia and Washington D.C. (Infoshop). The legal agreements include specific dated covenants reflecting these arrangements for those safeguards documents. In addition, these operational procedures resulting from the EMP/EMPF will be incorporated in the Project Implementation Plan (Operational Manual), also to be finalized by the implementing agencies during early the stages of implementation and formally adopted by the Recipient s IAs. 7. Safeguard Policies Safeguard Policies Triggered by the Project Environmental Assessment (OP/BP 4.01) Natural Habitats (OP/BP 4.04) Pest Management (OP 4.09) Cultural Property (OPN 11.03, being revised as OP 4.1 1) Involuntary Resettlement (OP/BP 4.12) Indigenous Peoples (OP/BP 4.10) Forests (OP/BP 4.36) Safety of Dams (OP/BP 4.37) Projects in Disputed Areas (OP/BP 7.60)* 3 [I [XI [I [XI [I [I [XI [XI * By supporting theproposedproject, the Bank does not intend to prejudice thefinal determination of the parties claims on the disputed areas 20

31 8. Policy Exceptions and Readiness 64. Given that the project is being processed following emergency procedures (OP/BP ERL) and grant financing will be covering 100 percent of project costs to be incurred by the Us, a waiver has been granted by the RVP of the EAP Region for delaying the preparation and disclosure of the EMF and the EMPF to a date early in the implementation stage. This is consistent with the exemptions allowed under paragraph 12 of OP 4.01, related to Environmental Assessment of Emergency Recovery Projects, and also allowed under paragraph 15 of OP.4.10 related to Indigenous Peoples, and with the general procedures specified under GPAI for individual country projects to be processed under this global program. A specific dated covenant indicating when the EMP and the EMPF must be completed and disclosed is included in the Financing Agreement. 65. On August 3, 2007, a Batch Waiver was approved by the corresponding Managing Director endorsing the request to waive Bank s policies in the contracts between the Recipients of Bank funding and the UN agencies participating as providers of technical assistant services under a group of twelve Bank-funded Avian Influenza Projects (including this AH1 project in Cambodia). This waiver endorsed the use by government agencies of contracts to be negotiated with the UN agencies (namely, FAO, WHO, UNICEF, OiE, and UNDP) that do not include: (a) the Bank s policy to impose sanctions in the event o f fraud and corruption involving an UN Agency; and (b) the Bank s right to require provisions in these contracts allowing the Bank to inspect and audit records and accounts of these UN agencies. 21

32 Appendix 1 : Results Framework and Monitoring CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project Results Framework To minimize the threat posed to humans and the poultry-sector by an AH1 infection in Cambodia, and to prepare for, control, and respond, if necessary, to a human influenza pandemic. 1 No cases o f H5N1 HPAI in periurban commercial poultry flocks once control and preventive measures are implemented. 9 Evidence* of improved effectiveness o f participating animal and human health services in responding to the risk of avian influenza in poultry and a human pandemic of influenza. U -0 verify that the PDO was chieved. Component One: Animal Health Systems Strengthened veterinary services I 1 Number of new VAHWs trained I To verify satisfactory and timely using the revised curriculum and progress in, or completion of, percentage of these providing Component 1. disease reports at commune meetings AH1 outbreak rapid response system Number of reports of suspected To verify improvement of disease HPAI from VAHWs. reporting 1 Targets for training in emergency vaccination met and government advised of findings. Avian Influenza prevention 1 Percentage of farms or markets a To evaluate whether on which recommended risk recommendations on disease mitigation measures to prevent control are being applied avian influenza are hlly implemented. Training of health workers Establish, train and make operational Evidence* of timely and satisfactory progress toward delivery of Component 2 outputs, as compared to the original plan, including specific indicators as follows: 9 percentage of provincial and district rapid response teams trained 1 percentage of VHV trained in avian influenza monitoring, reporting and control measures Percentage of warning signals - 1 To assess the progress of interventions 1 To evaluate the effectiveness o f Based on surveys following the technical study on high risk practices and their mitigation 22

33 reams interventions including training Enhanced AH1 case management and infection control Laboratory strategy Pandemic preparedness planning Rapid containment activities on time. percentage of targeted hospital staff trained for infection control control and case management guidelines (In case of outbreaks) 1 percentage of laboratory staff trained on lab techniques for avian influenza and other respiratory pathogens and on lab management 9 Laboratory strategy and plan developed 1 Pandemic preparedness plan developed and desk-top exercise implemented. Number of rapid containment (RC) exercises completed percentage of staff trained in RC. RC plan developed 1 To assess the progress of interventions. To evaluate the effectiveness of interventions including training 1 To assess the progress o f interventions To assess the progress o f interventions and evaluate the effectiveness o f intervention To assess the progress o f interventions Component Three: Inter-ministerial Coordination for Pandemic PreparednessRroject Coordination and Management Improved multisectoral cooperation. To assess the progress o f interventions. To evaluate the effectiveness o f interventions Coordination and management o f pandemic preparedness activities. NCDM staff hired and trained. PPRRP prepared and tested NCDM emergency MIS and M&E systems designed,. To assess the progress o f interventions developed and established 1 PPRRP activities integrated into the ongoing CBDRM * Via reports from independent technical and social audit teams that visit the field, review available self-reporting data, interview stakeholders, and judge the results. 1 To evaluate the effectiveness o f interventions 23

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36 Appendix 2: Detailed Project Description CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project Project Development Objectives. 1. Consistent with the GPAI, the overall development objective is to minimize the threat posed to humans and the poultry sector by AH1 infection in Cambodia and to prepare for, control and respond (if necessary) to a human influenza pandemic. The specific project development objectives are: (a) to reduce damage to the poultry industry and losses to the livelihoods of commercial and backyard poultry growers by containing the spread of the disease in animals; (b) to prevent or limit human morbidity and mortality by diminishing the viral load in the environment, stemming opportunities for human infection, and strengthening the curative care capacity; and (c) to prevent or curtail macroeconomic disruption and losses by reducing the probability of a human pandemic and improving emergency preparedness and response. Project Components 2. The project will finance activities under three components: (a) control and preventive measures minimizing the risk of HPAI in the animal population; (b) health systems preparedness and response to possible human infections; and (c) strengthening management systems, including institutional and legal frameworks, as well as M&E. This multi-sectoral approach will also focus on short-term activities to assist with immediate needs as well as medium-term actions to help strengthen capacity in the animal and human health sectors. Project Component A: Animal Health (estimated cost: SDR 2.75 million and US$1.45 million; total of US$5.8 million equivalent). 3. Background. The Animal Health component o f the National Comprehensive Plan for the control of Highly Pathogenic Avian Influenza (HPAI) is a comprehensive and flexible plan with four major (Al, A2, A3 and A6) and two minor (A4 and A5) subcomponents. Most of the resources will be devoted to Subcomponent A1 : 0 A1 Strengthening Veterinary Services 0 0 A2 Enhancing surveillance, investigation of and response to outbreaks A3 Addressing high risk practices in poultry production and trade 0 A4IEC 0 A5 Pandemic preparedness 0 A6 Coordination and Management 4. The project aims to address some of the current weaknesses in the veterinary services that limit the capacity to recognize, control and prevent highly pathogenic avian influenza and other diseases. A number of other projects have contributed and continue to contribute to the implementation of various activities of the Plan. The project will finance gaps in the funding of the current Plan, provide longer-term enhancement of veterinary services and provide the impetus for development of future comprehensive plans. 26

37 5. Subcomponent A1 : Strengthening Veterinary Services. Veterinary services in Cambodia consist mainly of the government veterinary services (which extends to District level) and private sector Village Animal Health Workers (VAHWs). The government veterinary services include the national Department of Animal Health and Production (DAHP), and Offices of Animal Health and Production (OAHP) in each of the 21 provinces and 3 municipalities, and some 184 district centers staffed by a District Veterinary Officer (see Appendix 6 for hrther details of the structure of the animal-related services in MAFF). Most of the strengthening of veterinary services in Cambodia in the near term will be achieved by increasing the number of appropriately trained VAHWs. However, this system will not function properly unless the trainers of these VAHWs are competent and supported by a properly resourced public veterinary service. Improved training requires assessment and consolidation of the current training programs and a strong training system. In addition, there is a need for better legislation to support the disease control activities of field staff. This subcomponent will focus on the following activities: 6. Ala - Improving Veterinary Legislation. A Veterinary Law is urgently needed to clarify the duties, obligations and responsibilities of the official veterinary services and farmers with respect to a list of important diseases and to define the roles and responsibilities of the veterinary service and other public sector agencies and private entities in disease control. Under this activity, assistance will be provided for drafting and implementing appropriate basic national laws and regulations that will require notification of certain serious diseases. These laws will afford animal health staff the right to take action in the event of a suspicion of a disease and will provide protection for animal health staff in such cases to enter property to investigate suspicious cases and to implement disease-control measures (such as movement controls) in the event of detection o f a disease. This will also address the regulation and administration of the VAHW system. 7. Alb - Strengthening the Training System. One of the main methods used for training of VAHWs is a cascade system in which trainers in DAHP (first tier trainers) provide training for staff at provincial or district level (second-tier trainers in OAHP), who subsequently train the VAHWs. This system has been widely used but will always be constrained by the quality of the personnel at each level in this cascade. The system will not achieve its objective of providing high quality training: (a) unless the knowledge and skills of the trainers at the top of the system are high quality; (b) if these first-tier trainers do not understand the needs and learning methods o f second-tier trainers and trainee VAHWs; or (c) if the wrong candidates are chosen as trainers at the first or second-tier. 8. This activity aims to consolidate the central training unit (including the first tier of trainers) by: (a) strengthening the quality and skills of these trainers; (b) revising and reviewing the curricula, training materials and training methods used for training second-tier trainers and VAHWs after conducting a training needs analysis; and (c) ensuring that all suitable training resources currently in use or produced in this activity are digitized and available through the training unit. It will build on the foundations laid by the FAD-funded activities under the Bank-financed Agricultural Productivity Improvement Project (APW. 9. The above objectives will be achieved through the appointment of two international consultants (specialists in education and veterinary science in developing countries) and two national consultants with well-developed veterinary and training skills. These consultants will also provide an assessment of the quality of the training being delivered at the provincial and district level by conducting regular audits of training and also conducting needs assessments. On the basis of these findings, they will suggest modifications to the training methods for second-tier trainers and the selection criteria for provincial and district staff who apply to become second tier-trainers (i-e., trainers of VAHWs). To enhance the knowledge and skills of trainers, two post-graduate scholarship awards will be made available for trainers working in the central training unit (on a competitive basis) to undertake training in a distance-based 27

38 course at the Masters level covering veterinary public health, epidemiology and disease investigations (e.g., the course offered in Veterinary Public Health by the University of Sydney). 10. The international consultants will be employed immediately on commencement of the project for an eight-month period. After an intensive review of existing training methods and materials, and of training needs and curriculum development, the consultants will oversee training of the first batch of second tier trainers within eight months of effectiveness. The national consultants will continue to provide support for this activity and for monitoring the quality of training throughout the duration of the project. Both international consultants will return for a review of activities after 18 months to consolidate the gains and implement appropriate modifications to the training system. 11. Alc - Training of Trainers. Using the skills developed in the central training unit and the revised training curriculum for second-tier trainers, a series of training courses at the provincial and district level will be conducted during the life of the project. Selection for these training courses will be competitive and based on merit and aptitude; not all provincial and district staff will automatically receive training as trainers. 12. Ald - Training of VAHWs and Disease Reporting by VAHWs. There are two main reasons for investing in the training of VAHWs. One is to ensure that village-level producers have access to basic animal health support while the other is for district, provincial and central public veterinary services to obtain intelligence on disease occurrence through reports from VAHWs. This system has been in place for some time, but the extent and quality of reporting has been variable. 13. This activity will provide appropriate basic training for VAHWs in disease recognition, prevention and control, and disease reporting, including AI and other diseases o f poultry. VAHWs will be trained at the rate of approximately 400 every six months using the revised curriculum. This will gradually replace the need for specific supplementary training in AI recognition, reporting, control and prevention currently being provided to existing VAHWs as an emergency response to the avian influenza epidemic. 14. This process will be required throughout and beyond the life of the project, given the apparent high attrition rate o f trained VAHWs, many of who only remain active as VAHWs for a short period of time after receiving training. However, the skills imparted to these VAHWs are not lost as they are applied by individuals in their day-to-day farming activities and can be called upon in the event of animal disease emergencies. All trained VAHWs will receive a basic kit of supplies. 15. Part of the revised training curriculum will provide information on the trigger points for notification of district authorities about animal diseases, ways of collecting and recording basic information on disease, and the reasons for and importance of collecting and providing information on the types of diseases seen during field activities (by clinical symptoms). Ultimately, the goal of the animal health services is to assist farmers. This can only be done if there is better information on the occurrence of diseases in the field. 16. As a condition of receiving training, all VAHWs trainees will be expected to attend regular commune meetings for a minimum two year period after receiving the training. This will serve the dual purposes of allowing VAHWs to report on findings and to learn of new diseases or regulations that could affect farmers in their village. 17. These reports will be collated by district staff attending the meetings and will be forwarded to provincial staff and regional project coordinators for collation and follow up. This material will be consolidated and eventually made available (ideally via the internet, especially as the reach of the internet 28

39 increases) as a resource for all animal health workers. The possibility of establishing an alert system for district staff and VAHWs in the event of detection of a disease that warrants extra precaution in an area will be explored (for example, through the use of SMS messages if appropriate). Until such a system can be established, the regular meetings will be used to disseminate such information. 18. All VAHWs (including those newly trained and active VAHWs invited to attend meetings) will be provided with a meal allowance when attending monthly meetings. The project will also provide some seed money to support development of VAHW associations to improve linkages between VAHWs. 19. Ale - Supporting District Veterinary Staff. District veterinary staff forms the link between private sector VAHWs and the public veterinary system. To fulfill this role properly they need to be provided with resources and additional training in disease investigation, risk and hazard identification and emergency responses. Under this activity they will be provided with resources to travel to communes for regular meetings and to undertake investigations in the event of emergency reports and other disease reports from VAHWs. 20. All field activities undertaken will be reported to the relevant provincial office and the regional project coordinators who will conduct regular audit checks of activities to ensure that district staff is complying with reporting requirements by regional consultants (see Subcomponent A2c). Although not all district staff will attend courses for training of trainers, all will be eligible for additional training through the training unit in matters relating to animal diseases and disease investigation, disease prevention, emergency response disease reporting and other issues relating to conducting regular meetings with VAHWs at commune level. District staff will also be provided with funds for telephone and electronic communications. 21. Alf - Strengthening DAHP. At present, limited operational budgets, equipment and supplies are available within DAHP. This project will provide a range of resources to support staff at the central level in the National Veterinary Research Institute (NVRI), the Animal Health Office, and the Animal Production Office (all of which are involved in avian influenza control and prevention, including vehicles, computers and funds for communication. This activity will also include a short-term international consultant and full-time national consultant in disease information management to ensure that the information from VAHWs is properly recorded, analyzed and made available to all animal health staff using the resources already in place for disease recording (such as TAD Info.). 22. Alg - Strengthening Capacity of Provincial and Municipal Offices. As with the central offices, OAHPs at provincial and municipal levels require additional facilities and vehicles to allow them to perform their duties effectively, to supervise the training and to collate/disseminate disease reports. This activity will also provide funds to support travel required by provincial staff to oversee district staff and to undertake travel for disease emergencies. Each office will be provided with a vehicle and operating funds for vehicles and communications, and an LCD projector for training, building on the resources provided by other projects. 23. Alh - Strengthening Laboratory Capacity. Through a number of other initiatives, the laboratory capacity of DAHPWRI has already been strengthened. An extension to the laboratory is planned but requires appropriate ventilation and air-flow system, without which this facility and the equipment and supplies acquired elsewhere cannot be fully utilized. 24. This activity will fund the design and installation of a ventilation system for the laboratory extension. Funds will also be provided to rejuvenate three small regional laboratories to facilitate specimen transfer from the field to the central laboratory. These laboratories will be provided with basic equipment (such as refrigerators and a centrifuge) to allow for preliminary specimen processing and 29

40 storage. Each regional laboratory will be provided with a stock of transport boxes meeting international standards for transport of specimens containing infectious material. 25. Subcomponent A2: HPAI Investigation and Response. This subcomponent aims to support effective national investigation and response systems and to manage outbreaks effectively. In addition, better information on the epidemiology of HPAI, based on investigations of outbreaks and specific studies, will improve strategies for disease control. (A discussion note on Cambodia s surveillance strategy is in Appendix 9 - see Note 2.) This subcomponent comprises the following activities: 26. A2a - Rapid Response to Disease Outbreaks. When new cases of HPAI (or other emergency diseases) are reported they must be investigated quickly and an appropriate rapid emergency response mounted to prevent additional spread of infection. The standard approach to this disease is based on culling of the infected flock, cleaning and disinfection at the infected site, and movement controls. This is supported by investigations o f the disease outbreak to ascertain the most likely source of infection and to allow tracing of infected poultry or contaminated material that may have moved from the infected area. 27. This project activity will establish an emergency contingency fund to facilitate rapid responses to outbreaks that will allow rapid mobilization of the necessary funds for payment of workers involved in containing the disease. Villagers are more likely to report disease if they know that they or their neighbors will not be disadvantaged by doing so. Therefore, part of the contingency fund will cover the cost of buying poultry taken as a result of disease investigatiodsurveillance activities. A small fund will also be established for purchase of animal vaccine for use in emergencies. 28. A2b - Trials on Emergency Vaccination. If an outbreak o f disease is reported early, emergency vaccination around a focus of infection can help to prevent the local spread of disease. By including emergency vaccination around an outbreak site as a part of the response mechanism, the number of poultry culled can be kept to a minimum and villagers will be reassured that early reporting will not lead to mass slaughter of poultry in their village. Currently, this practice is not used as part of the emergency response in Cambodia. However, once trials of emergency vaccination have been conducted and found to be operating smoothly it can be incorporated into the standard operating procedures for disease control. 29. Preliminary trials and training will be conducted in each of the four regions in emergency vaccination. This activity will be led by regional co-coordinators and will involve selected provincial and district staff and VAHWs. The objectives o f this training are to teach proper techniques for vaccination, determining the extent of vaccination, and infection control during vaccination. These training exercises will be repeated in each year of the project so that sufficient appropriately trained staff can be mobilized rapidly to respond to any outbreak and undertake emergency vaccination. If emergency vaccination is included as a part of the standard response to outbreaks then the training program for VAHWs will be modified to include this training in this technique. 30. Emergency vaccination (and all other vaccination) depends on the availability of an appropriate cold chain. This project will provide refrigerators to all provinces and selected districts to allow for the proper storage o f vaccines. For places where power supply is intermittent, solar powered or other suitable refrigerators will be supplied A2c - Regional Coordination and Supervision of Outbreak Responses. Each of four regions6 will be provided with a regional coordinator who will report to the national animal health project coordinator. These regional coordinators will have two main functions: to support and monitor rapid The country will be divided into four regions and each of the four regional coordinators will supervise activities in 5 to 7 provinces and municipalities contained within hdher region. 30

41 responses to reports of emergency disease, and to ensure that disease reports from VAHWs are being received by district staff and also acted on and sent upwards to the national level (see Subcomponent A6 - Project Management). 32. The regional coordinators will be equipped with a rapid response vehicle that can be used in the event o f an emergency disease outbreak to provide required emergency supplies to outbreak sites and also to transport specimens from outbreak sites to the central laboratory. Regional coordinators will also play a role in overseeing the responses and ensuring these follow approved guidelines and procedures established relating to mobilization of funds and teams for emergency disease control. They will attend some meetings of district staff with VAHWs to assess the quality of the information that is being obtained and delivered and to understand the issues faced by both district staff and VAHWs. 33. A2d - Support for Additional Surveillance and Epidemiological Studies. Funds are required to ensure that important existing or planned studies on the epidemiology of H5N1 HPAI are conducted, including support for market surveillance and wild bird studies. These studies will also monitor changes in the levels of infection following implementation of measures under activity A3b. 34. Subcomponent A3: Reducing Risk in Production and Marketing Systems. It is unlikely that the threat of HPAI could be eliminated from Southeast Asia in the medium term; even if Cambodia manages to eradicate infection, it is likely to return, leading to further outbreaks and emergency responses. To mitigate this, an assessment of the risks posed by different farming systems and production and marketing techniques will be conducted so that appropriate preventive measures can be determined and applied. This strategy is consistent with the approach proposed at a recent UN technical workshop in Rome in June Under this approach, high-risk practices are identified and, where practical, eliminated; if this is not feasible, other risk mitigation measures are implemented. 35. A3a - Study on risks and risk reduction in production and marketing systems. This activity will review the production and marketing systems in Cambodia and provide recommendations on appropriate longer-term measures to be implemented to reduce high-risk poultry production and marketing practices that are likely to result in the spread or the persistence of infection. This will consider all options including vaccination, stamping out, modification or elimination of certain practices, movement controls, cleaning and disinfection, and enhancement o f farm biosecurity measures. This study will examine the economic, social and environmental aspects of the measures proposed and only recommend those that are technically feasible and cause the least possible collateral damage. The results of this study will be used to guide adjustment o f the National Avian Influenza Comprehensive National Plan beyond A3b - Implementation of Risk Reduction Measures. The study on risk mitigation will be followed by promotion of the agreed strategies for reducing the risk posed by these production and marketing practices by staff of DAHP supported by a national consultant. This will cover each o f the production and marketing systems: village-level smallholders, small commercial chicken flocks, extensive duck production, large commercial farms, and marketing and transport. 37. The Animal Production Office will use the information obtained from the study to promote appropriate changes to poultry production and marketing systems which, depending on the sector involved, will likely include but will not be limited to enhancements to farm biosecurity. Staff will be involved in developing and demonstrating appropriate production models for small commercial flocks. 38. Subcomponent A4: IEC. This subcomponent will focus on improving knowledge and understanding of the disease among the general public and specific targeted audiences, including poultry producers, traders, processors, teachers, local authorities, police and other government staff. The project 31

42 will provide limited additional funds to support IEC material development through the Extension Office of DAHP as most planned IEC activities are already funded under other activities. 39. Subcomponent A5: Pandemic Planning. DAHP will hold workshops to discuss its role and the roles of Provincial and District veterinarians in the event of a Phase 4 or Phase 5 and 6 occurrences, and to prepare a sectoral pandemic preparedness and response plan. DAHP will participate in all planning sessions conducted under NCDM auspices. 40. Subcomponent A6: Project Management. The quality of service delivery in this project will depend heavily on the management and direction provided by the IA. DAHP will be the IA for the Animal Health component of the project, with NVRI as the coordinator. The government intends to sign a service contract with FA0 for the provision of technical assistance to support the implementation of this project. The IA will implement this component following the provisions of established legal agreements and will present quarterly reports to the World Bank, including physical progress and financial management reports, and it will be subject to periodic supervision by the Bank. In addition, project accounts and financial statements kept by the IA will be audited annually by independent auditors acceptable to IDA, together with other components. 41. For effective implementation of the activities, a small coordinating unit will be established within DAHP. The project will provide funding for: (a) the technical assistance, including a part-time Chief Technical Advisor and various short-term and long-term specialists in key areas in support of good project management; (b) additional support to the procurement and financial management functions to be carried out by hiring local consultants in these two areas; (c) the administrative support by hiring a secretary and two drivers; (d) the provision of office equipment (computers, printers, photocopiers, desks, etc.); and (e) the provision of funding for incremental operating costs for the field work of the technical advisors and specialists, as well as for the activities of the coordinating unit. This includes purchase of satellite telephones and GPS equipment to be used to enhance field communication and epidemiological information. 42. As part of the activities to be carried out, a management system will be established and operated to ensure close communication at all levels of DAHP (at the central, provincial and operational district levels), as well as with the Avian and Human Influenza Inter-ministerial Committee, the MOH and the NCDM. Provincial committees will facilitate horizontal linkages to relevant entities, which will be essential for supporting regulatory activities on disease control. This will be supported by the four regional coordinators who will play a key role in overseeing the activities in this project. Similar structures will be explored at the district and commune levels (see organizational and operational chart). 43. M&E will be underpinned by base-line studies that will assess the situation at project inception. An international expert in M&E will be appointed for three months to establish the M&E system and to assist in the base-line studies. Project Component B: Human Health (estimated cost: SDR 670,000 and US$2.44 million; total of US$3.50 million equivalent). 44. Background. In the 1990s, the government introduced health system reforms to improve and extend primary care through the implementation of a district health system that focuses on the distribution of facilities in accordance with a health coverage plan and the allocation of financial resources to the Provinces. Operational Districts were designated and are composed of 100,000 to 200,000 people, with a referral hospital providing a comprehensive package of activities and health centers delivering primary health care to a target population of 10,000 through a minimum package of activities. The first National Health Strategic Plan, a medium-term expenditure framework and an M&E framework were 32

43 developed and approved in The main challenges identified were: (a) improving the quality of care; (b) increasing the utilization of cost-effective health care; (c) improving the distribution of staff within the health sector; and (d) improving reproductive and adolescent health services. 45. In 2004, outbreaks of avian influenza in poultry occurred in Cambodia. Since the first confirmed human case in January 2005, there have been a total of seven confirmed cases (all seven patients died). In response, the government has prepared the National Avian Influenza Control and Human Pandemic Influenza Preparedness Plan for Cambodia (presented at the Beijing Conference in January 2006), which includes plans fi-om MAFF, MOH and NCDM; a road-map for communication is also described. Using experience gained during the Severe Acute Respiratory Syndrome (SARS) outbreak, MOH has prepared its Avian Influenza Action Plan in Cambodia. The purpose of MOH s plan is to highlight the current surveillance and response activities in Cambodia and to identify areas where key action is needed to fill gaps in the system. 46. MOH conducts communicable disease surveillance using the CAM EWAR System (Cambodia Early Warning System), which consists of data collection and analysis on 12 syndromes and diseases. Data are collected at the Health Center level on each of these conditions, and sent through the Operational District and Provincial Health Department levels to the Communicable Disease Control Department (CDCD) at the national level. The system is now implemented nationally. Acute respiratory infection (ARI) is one of the diseases under surveillance and would theoretically capture human cases of influenza. To further supplement the data collected through the CAM EWAR System, MOH expanded the operation of the existing hotline established during the SARS outbreak. The hotline was used by health care professionals to report suspected cases to the central authorities, but with the activity of AH1 in Cambodia it was deemed necessary to expand the role to enable the public to report to MOH. It is also used more broadly for reporting outbreaks of any communicable disease. Under the direction of, and in cooperation with, the CDCD, the Provincial Rapid Response Teams (RRTs), created during the SARS outbreak respond in the event of suspected (or confirmed) human cases. In order to monitor influenza-like illness (ILI) epidemiology in Cambodia, MOH has been establishing an ILI system which is expected to be crucial for detecting increased activity of ILI in the community. 47. In addition to conducting surveillance, arming the public with knowledge relating to the disease (such as how it is transmitted and how it can be controlled and prevented) is an important aspect of prevention. Informing the public about what to do in the event of a suspected case is also an important measure for prevention (for example, ensuring that the public are aware of the hotline). MOH has an IEC plan targeted at health service providers, and relevant stakeholders are in the process of preparing an integrated National IEC Strategy to include inputs from MOH, MAFF and others, that will be integrated into the National Comprehensive Avian and Human Influenza (AHI) Plan. 48. The project support to MOH s Plan for Avian and Human Influenza comprises seven subcomponents, and mirror the key action areas in the Plan: (a) education for health workers and the public; (b) surveillance, investigation and response; (c) case management and infection control; (d) laboratory support; (e) pandemic preparedness planning for the health sector; (f) rapid containment; and (g) management and coordination. These subcomponents are described below. 49. Subcomponent B1: Education for Health Workers. In order to improve surveillance, health care workers - including Village Health Volunteers (VHV) and local authorities -- must have the necessary knowledge to ensure that appropriate questions are asked when a person presents with a fever and a cough. This will include ascertaining whether the patient has been in contact with sick or dead poultry or healthy ducks, and for the health service provider to know the appropriate subsequent actions to take. They will need to be trained on Avian Influenza Awareness, community surveillance and rapid containment measures. Complementary to providing information to the health care workers, MOH also 33

44 has a role to play in ensuring that the correct information is provided to the public with respect to AHI. (MOH is working with WHO and UNICEF to develop IEC materials for a mass media education campaign on avian and seasonal influenza, and this activity is separately funded.) MOH also intends to develop documentary style television spots to cover the breadth of issues related to avian influenza. This subcomponent supports the design, production and printing of training and IEC materials for health care workers, as well as the development and broadcasting of television spots targeting professionals (rather than the general population) at this stage. Financing for the majority of these activities under the Plan is being provided by UNICEF (with funding from Australia and Japan), AusAID and USAID. Support from the project will cover development and distribution of the training materials, the IEC materials, and the radio and television spots. Financing from the project will also be provided for the development and dissemination o f a training strategy. 50. Subcomponent B2: Surveillance, Investigation, and Response. This subcomponent will support serological investigations of clusters and strengthen the national disease information system as well as the RRTs. 0 Emergency AI outbreak investigations and response. Financing requirements for investigations include travel costs for staff conducting the response, the consumables necessary for the investigations, and the shipping costs for blood samples collected. Project support will cover all of these activities. National Level Disease Information System Management. An information technology consultant will also be supported to ensure that the implementation of the CAM EWAR System will be standardized in terms of reporting and analyzing surveillance data through the use of a customized data application. Financing for many of these activities is covered by WHO, USAID, US-CDC and AusAID. Support from the project will include technical assistance for the information technology, refresher training to VHV on AI and PI awareness, and communities based surveillance, RRT training of provinces and district levels. Strengthening early detection and rapid response. Activities for strengthening early detection and rapid response include the costs associated with office supplies, communication tools and a workshop on lessons learned from the affected provinces. Financing for a number of these activities is being provided through ADB, AusAID, and CDC-USA. Financing from the project will cover the incremental operating costs for provinces not covered by support available from other donors (including office supplies, operation and maintenance of vehicles, staff travel and travel per diem) Subcomponent B3: Case Management and Infection Control. There are five national referral hospitals designated to handle avian influenza cases: Calmette Hospital in Phnom Penh and the Referral Hospitals in Kampot, Kampong Cham, Stung Treng, and Siem Reap. These hospitals have basic isolation facilities and training has been provided to the staff in infection control; therefore, they can manage cases of suspected avian influenza. In reality, suspected cases often go to the referral hospital closest to their residence, prior to being referred to these designated hospitals. In some cases, people have crossed the border to seek care in Vietnam. As a consequence, the Plan includes strengthening the capacity of referral hospitals in Cambodia to manage suspected cases prior to their referral to the five national referral hospitals. Support under the National Plan for this subcomponent includes rehabilitation of infrastructure, purchasing medical equipment, ambulances, and PPE stocks for five hospitals, and evaluation of training effectiveness and infection control training. Financing for these are being supported by ADB, WHO, URC, USAID and AusAID. Activities proposed for project financing are the development of the case management training curriculum; training on clinical case management; equipment and supplies for infection control and waste management; training of public and private health care workers in infection control; and activities associated with health care waste management. 34

45 52. Subcomponent B4: Laboratory Support. In Cambodia, the Pasteur Institute (IPC) is the only laboratory at present that can perform rapid, reliable and sensitive testing for H5N1 and other respiratory pathogens. Given its current functions as one of the national referral laboratories for avian influenza and also as it is the National Influenza Center (NIC), its workload has increased significantly. Other public health laboratories at the central level will have to be strengthened to relieve the IPC of their routine work, specifically to handle triagehapid testing of specimen before reference to IPC and to perform quality diagnosis. The IPC will remain the national reference laboratory for final confirmation. Activities under the National Plan in support of this subcomponent include: technical assistance; continuous educationhefresher training of laboratory staff on site (using international trainers) or at the local level using existing trainers in the country; training on new laboratory techniquedmanagement; equipment; specimen collection kits; laboratory consumables and reagents; and transport costs for specimen transport inside Cambodia and shipment abroad to WHO reference laboratories. Financing for all of these activities is being provided by US-CDC, the government of the United States and AusAID. Project financing will support the development of a national laboratory strategy and work plan, as well as the strengthening of identified public health laboratories. 53. Subcomponent B5: Pandemic Preparedness Planning. In the event of the declaration of a pandemic, MOH will have a key technical role to play. MOH will have to concentrate on two issues to be prepared for a pandemic: home-based care (basic drugs treatment, PPE) and the hospital referral system (patient transport, PPE, Tamiflu, physicians, and equipment). Activities under this subcomponent include the development of a sector policy guideline and training at the provincial level so that they can prepare their own pandemic preparedness plans. 54. Subcomponent B6: Rapid Containment. Rapid Containment strategy refers to MOH efforts to stop or slow down the human-to-human spread of a novel influenza virus that has the potential to create a pandemic influenza. Along with routine public health measures (e.g., patient treatment, infection control, contact tracing and intensified surveillance), the following exceptional containment measures are needed for successful rapid containment: quarantine at home or in a designated facility; social distancing such as closing of schools and workplaces; preventing public gatherings; and mass administration of antiviral drugs. MOH in collaboration with WHO has developed a plan specifically for outbreak containment with 4 points: case management, infection control, isolatiodquarantine, and equipment and supplies (logistics). Financing for all of these activities is being provided by WHO. Activities under this subcomponent include: rapid containment; training curriculum development; workshop for rapid containment plan implementation; and rapid containment training for provincial, district and health centedhospital staff, border quarantine staff, and RRT, as well as for military, police and local authorities. Desktop exercises and simulation exercises will also be supported. 55. Subcomponent B7: Management, Coordination, and Strategy Development. Implementation of the Human Health component, including financial management and procurement, will be undertaken by the government. Upon signing of the technical services contract between government and WHO, WHO S in-country staff will provide support for component management, coordination and strategy development. This support will be complemented by specialized consultants in key areas, additional fixed-term staff for financial management and procurement, and administrative and support staff (including a secretary and drivers). Financing will also be provided for laptop computers, GPS units, a satellite phone, office equipment and supply, vehicles and their operation and maintenance, meeting costs and management training for CDCD staff, 35

46 Project Component C: Inter-ministerial Coordination for Pandemic Preparedness (estimated cost: SDR 383,000 and US$1.11 million; total of US$1.70 million equivalent). 56. Background. The National Plan (Plan) builds upon the country s inter-ministerial arrangements for natural disaster management which are entrusted to NCDM. The Plan recognizes that the current Terms of Reference (TOR) for NCDM, focused on flood and drought, do not adequately cover AHI. To address AHI, the Plan proposes to modify NCDM s TOR and strengthen NCDM as an institution without creating unnecessary bureaucracy. In addition, the Plan proposes that NCDM address four major objectives: (a) develop an operational, inter-ministerial, Pandemic Preparedness, Response, and Recovery Plan (PPRRP); (b) implement the PPRRP; (c) establish an effective Emergency Management Information System (MIS) including an M&E system; and (d) incorporate Pandemic Preparedness activities into Community Based Disaster Risk Reduction Programs (CBRDM). The Inter-ministerial Cooperation for Pandemic Preparedness Component will support the Plan in each of the above areas, including the objective of modifying NCDM s TOR and strengthening NCDM as an institution. It will have the following five subcomponents: 57. Subcomponent C1: NCDM Capacity Building. The subcomponent will support: (a) development of legislation requiring pandemic preparedness planning as part of national policy for emergency management with sub-decrees based on this legislation assigning roles and responsibilities to NCDM; and (b) establishment of a full-time NCDM General Secretariat and various internal units to oversee implementation of coordination activities among ministries and external partners (including international organizations, NGOs, and bilateral mechanisms) for pandemic preparedness programs and projects. 58. Towards obtaining the appropriate TOR for NCDM, the subcomponent will review NCDM s current roles and responsibilities, discuss changes in workshops, and formulate draft legislation for submission to Parliament. Upon approval of the legislation, the subcomponent will support the issuance of appropriate sub-decrees mandating that NCDM facilitate inter-ministerial coordination and other related pandemic preparedness activities. 59. Towards the establishment of the NCDM General Secretariat and various internal units, the subcomponent will undertake a review of NCDM s organization structure and develop its new staffing requirement. For the staff, it will assess the training needs and create a human resources development strategy and training program. A key area of expertise to be developed is financial accountability of the institutions and individuals involved in an emergency operation. The subcomponent is expected to provide some IT related support to NCDM s infrastructure. In addition, it will establish an Emergency Operations Center, which will serve as a communications and logistics hub for pandemic preparedness, response and recovery. Lastly, the subcomponent will create within NCDM an ability to conduct field operations through the purchase of four 4-WD vehicles and six motorcycles with operating costs. 60. Subcomponent C2: Pandemic Preparedness, Response, and Recovery Program. The subcomponent will support: (a) preparation and implementation of the PPF2RP; and (b) testing of the PPRRP. 61. For PPRRP preparation, the project will review the existing draft National Policy of Emergency Management, prepare a draft PPRRP, and facilitate its discussions in several workshops. Based upon the discussions, the subcomponent will develop a training program for staff in all ministries to introduce their staff to pandemic preparedness. The preparation of the PPRRP will be followed by multiple workshops carried out nationwide. In parallel to the training and discussions, the subcomponent will facilitate Business Continuity Planning (BCP) for the maintenance of essential services for all relevant public institutions. It will then make field assessments of pandemic preparedness plan at sub-national levels to 36

47 guide further plan development. All the above activities will be enhanced with study tours to neighboring countries. 62. Towards PPRRP Testing, the subcomponent will conduct simulations (from desktop to full field scale) of Disaster Preparedness and Emergency Response. In addition to evaluating the country s capacity to pick up and amplify early warning signals and to institute damage containment mechanisms early in a crisis; the simulation exercises will assess the factors that represent a constraint to an effective preparedness, response, and recovery program. 63. Subcomponent C3: NCDM Emergency MIS and M&E Systems. The subcomponent will support: (a) the design, development, and implementation of reporting systems for emergency management information flow; and (b) the establishment of the M&E system for the National Comprehensive AH1 Plan. 64. Towards emergency management reporting design, the subcomponent will review current NCDM disaster data gathering and reporting flow through, among other things, a consultative workshop. Based upon the review, it will assign detailed responsibilities to various institutions (ministries and NGOs). It will standardize reporting formats, and provide training on them across commune, district, province and national levels. In addition, it will provide IT equipment for Provincial emergency data systems and District and Commune-level emergency communication systems (including cell phones). 65. The subcomponent will develop an M&E system for the overall national effort based on Pandemic Preparedness, Response, and Recovery needs and data management capacities. It will conduct workshops with stakeholders to identify gaps for the improvement of the M&E system. Lastly, it will undertake external evaluations, including one after project implementation completion, and validation of processes and performance. 66. Subcomponent C4: Incorporate Pandemic Preparedness Activities into Community Based Disaster Risk Reduction Programs. The subcomponent will review existing public awareness programs being implemented by NCDM and other public institutions including MOH and DAHP, through nine consultative review sessions. It will also carry out 30 consultation-sessions with various village associations, NGOs, and international organizations on their current public awareness programs and community based disaster risk reduction programs. It will support three training courses, three workshops and follow-up operations. 67. Subcomponent C5: Project Management and Administration. Implementation of the component, including administrative support, financial management and procurement, will be undertaken by NCDM. This will be done by using NCDM s existing in-country staff, complemented with specialized consultants in key areas, a project advisor, an independent procurement coordinator, an independent auditor, a financial management consultant and administrative and support staff (including a secretary and drivers). 37

48 Appendix 3: Project Costs CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project TOTAL PROJECT COST BY COMPONENT PROJECT TOTAL TOTAL PROJECT COST BY EXPENDITURE CATEGORY (IN US$ THOUSAND) Financing by Source (US$ Thousand) Expenditure category 1. Civil works 2. Goods 3. TrainingMrorkshops 4. Consultant Services 5. Incremental Operating costs TOTAL PROJECT COSTS TOTAL IDA AHIF PHRD ,254 1, ,657 1, ,439 1, ,780 2,540 1, ,000 6,000 2,000 3,000 Note: Identifiable taxes and duties are US$506 thousand (4.6percent) and the total project cost, net of taxes, is US$10.49 million. 38

49 COMPONENT k ANIMAL HEALTH PROJECT COST BY EXPENDITURE CATEGORY (US$ THOUSAND) Expenditure Category World Bank AH1 PHRD Project (IDA) Facility Total 1. Civilworks 2. Goods 3. Training and Workshops , , Consultant Services 1, , Incremental Operating Costs 1, ,745.2 Component Total 4, , ,800.0 COMPONENT B: HUMAN HEALTH PROJECT COST BY EXPENDITURE CATEGORY (US$ THOUSAND) Expenditure Category World AHI Facility PHRD Project Total Bank 1. Goods I I Training and Workshovs I , , , , , Consultant Services 4. Incremental Operating Costs Component Total COMPONENT c: PANDEMIC PREPAREDNESS AND PROJECT COORDINATION AND MANAGEMENT PROJECT COST BY EXPENDITURE CATEGORY (US$ THOUSAND) Expenditure Category World AHI Facility PHRD Bank Project Total 1. Goods Training and Workshops I I _ Consultant Services 4. Incremental Operating Costs Comuonent Total 39

50 Appendix 4: Financial Management and Assessment Report CAMBODIA: AVIAN AND HUMAN INFLUENZA CONTROL AND PREPAREDNESS EMERGENCY PROJECT Summary of the Financial Management Assessment 1. An assessment of the project financial management arrangements was carried out by the Bank s financial management team during project appraisal in May 2006 and re-appraisal in September In view of the emergency nature of the project and the limited FM capacity of all implementing agencies (MAFF, MOH and NCDM), an action plan to strengthening project financial management arrangements was agreed with RGC. With the implementation of the agreed actions, the project financial management arrangements are considered adequate to meet the World Bank s minimum requirements. Country Issues 2. The Country Financial Accountability Assessment (CFAA), which was carried out in May 2003 as part of the Integrated Fiduciary Assessment and Public Expenditure Review, concluded that the overall fiduciary risk in Cambodia is high. In spite of the multiplicity of controls and the centralized nature of the public expenditure management system, weak financial management practices pose serious fiduciary risks. The control environment is weak, especially in the area of cash management, and both internal and external auditing capacity needs strengthening. These systemic weaknesses provide opportunities for corruption and misuse of funds, which were confirmed by recent Bank INT investigations. 3. The US$ 14 million IDA grant for a Public Financial Management and Accountability project (PFMAP) to address the most serious governance issues, which were recognized in the 2005 CAS as being the primary obstacle to poverty reduction and aid effectiveness, has just become effective on 2gth June The PFMAP provides support to the government PFM Reform Program, which a PFM Multidonor Trust Fund (MDTF) administered by the Bank is already supporting. The MDTF co-finances the PFMAP. Actions in progress and to be undertaken under the project include assistance to improve revenue management; budget formulation and integration; budget execution (including the development and implementation of an integrated financial management system and strengthening public procurement system); to implement reforms in the Ministry of Economy and Finance s (MEF) personnel management through establishing merit-based selection and promotion and performance management through a merit based pay initiative for selected MEF staff and developing the capacity of internal audit of government and of the external audit under the country s supreme audit institution, the National Audit Authority. 4. While these actions have started to address specific fiduciary issues, the country financial management environment for externally funded projects remains weak. Risk Analysis 5. Inherent Risk. The inherent risk to the project from the country environment is considered to be high due to the weak financial control environment and systems in the public sector. This high level of inherent risk has been mitigated by the actions described below. 6. Control Risk. Overall control risk at the project level is assessed as high due to weak financial accounting and management information systems, limited financial capacity and lack of effective internal control oversight, but is considered to be reduced to moderate after implementation of the risk mitigation measures described below. 40

51 Risk Inherent Risk Country level Entity level Control Risk Implementing entities Budgeting Funds flow Staffing Accounting Reporting External Audit Overall financial management risk. Risk Rating H S H H H H H H H H Risk Mitigation Measures To address the high level of country risk, a government led PFM Reform Program is under implementation, and is being supported by a Bankadministered MDTF and the PFMAP (as described above). Project specific financial management arrangements will be tlut in dace for this moiect. The financial management arrangements for the proposed AH1 project will be through the establishment of a separate financial management unit, within a PIU, staffed by consultants for MAFF and NCDM, and through the financial unit of the ongoing HSSP for MOH. Annual budgets based on project annual work plans will be prepared by each IA and agreed by the Bank. Each IA will maintain its own Designated Accounts to be opened at an acceptable commercial bank. IDA and AHIF sources of funds will flow to one designated account, and PHRD to a separate DA. For MOH, the FM tasks will be handled by the existing finance unit in-charge of the on-going HSSP with some additional staff required. For MAFF and NCDM, a financial management consulting firm will be contracted to install computerized accounting software and provide training. In addition, a FM consultant will be recruited at both IAs to strengthen the FM unit. Each IA will follow accounting procedures described in the Financial Management Manual acceptable to MEF and IDA. They will account for projects funds and activities in their accounting systems and maintain their accounts and records. The project accounting records will match each expenditure with the appropriate source of funding to account and report on uses by source of funds. Each IA will produce quarterly IFRs in line with an agreed format and submit to the Bank within 45 days after the end of each quarter. The NCDM will be responsible for compiling the annual project financial statements and have it audited by an independent auditor under TORS acceptable to the Bank, including review of internal controls. Residual Risk S M M M M M M M M M 41

52 Strengths and Weaknesses 7. Strengths: The FM arrangement of the Human Health component will be handled by MOH through the existing finance unit in charge of the on-going Health Sector Support Project (HSSP), which has developed financial management capacity that can be made available to the proposed project. In addition, the project will be carried out in accordance with the provisions of the Good Governance Framework (see Appendix lo), as well as the Guidelines on Preventing and Combating Fraud and Corruption in Projects Financed by IBRD Loans and IDA Credits and Grants (the Anti-Corruption Guidelines ), dated October 15, Weaknesses: Limited FM experiences and capacities at MAFF and NCDM. There will be no consolidated project financial reporting, each component will be managed and reported separately. Implementing Entities 9. The government has decided that implementation of the project will be the responsibility of three Implementing Agencies (IAs), as follows: Component A: The Animal Health component will be implemented by the Animal Health and Production Department (DAHP) of MAFF through its Animal Health Office, Animal Production Office, and the NVRI. A small unit will be created within DAHP to provide support in procurement, financial management, M&E, and overall administration for the component (with technical assistance). 0 Component B: The Human Health component will be implemented by MOH through the existing PIU in charge of the on-going Health Sector Support Project (HSSP). An additional Financial Management consultant will be recruited to assume these new responsibilities. Component C: NCDM, through its General Secretariat, will be in charge of the Inter-Ministerial Coordination for Pandemic Preparedness component, as well as the overall project coordination and management (with technical assistance). Project Financing Arrangements 10. The project is being financed by grants from IDA, the multi-donor fund for avian influenza AHIF and the Japanese PHRD Fund, as follows (see Attachment I to this Appendix): The PHRD Grant (US$3 million) will finance 100 percent of the expenditures (including taxes) corresponding to: (i) all Training and Workshops under Component B; and (ii) all the Consulting Services for Components B and C. The IDA Grant (US$6 million) and the AHIF Grant (US$2 million) will cofinance (in 75/25 percent proportion) all eligible expenditures not covered by the PHRD grant for all project components. These financing shares of IDA and AHIF (75 and 25 percent, respectively) have been determined factoring in that no taxes and duties should be financed from the AHIF grant (see computation in Table 1 below). All taxes and duties on these categories will be fully covered by IDA. 7 The Cambodia country financing parameters allow for IDA financing of all taxes and duties. IDA has appraised that taxes and duties do not constitute an excessive share of project costs (estimated at about 4.6percent of project expenditures on these categories). 42

53 Table 1 : Computation of Financing Arrangements for Expenditures Co-financed by IDA and AHIF: Components A, B and C for a total of US$8 million Costs excluding taxes Estimated taxes (fully IDAfinanced)' Costs including taxes TOTAL FINANCING ARRANGEMENTS COSTS IDA AH1 Facility (%'000) $'OOO % $'OOO YO 7,632 5, , ,000 6, , The project accounting system used by each IA will record the appropriate source o f funding for different expenditures, to account and report on their uses by source of funds. The project financial statements and audit will confirm adherence to the stipulated financing shares, thereby also confirming that taxes and duties have not been financed from the AHIF proceed^.^ 12. The following Tables 2 and 3 indicate the amounts allocated per component and per category and the percentage of project expenditures financed by each financing source. Table 2 -Total Project Cost per Component and by Financing Source. (US$ thousands) Activity Component A: Animal Health Component B: Human Health Component C: Pandemic Preparedness and Project Coordination and Management Project total: World Bank (IDA) AH1 PHRD Project Facility Total 4,350 1, ,800 1, ,089 3, ,700 6,000 2,000 3,000 11,000 ' These estimated taxes have been computed based on the different tax rates applicable to each expenditure category and taking into account the items expected to be exempted from local taxes. 9 For clarity, the Notes to Project Financial Statements will state that the financing shares between IDA and AHIF financing stipulated at the beginning have been determined in a manner as to exclude any financing of taxes and duties from the AHIF; and confirm that these agreed financing shares have been adhered to, and therefore no taxes and duties have been financed from the AHIF. 43

54 Table 3 -Total Project Cost Financing by Expenditure Category and by Source. 3. Training and 1,657 Workshops 4. Consultant Services 4, Incremental Operating Costs TOTAL PROJECT COSTS 1, , , ,540 1, ,000 6,000 2,000 3, s The tables included in the Attachment 1 to this Appendix, present the allocation of funds from the three sources by Expenditure Category and by Component. Funds Flow (see Attachment 2) 14. As indicated above, funding for the project will be derived from three different sources: (i) IDA grant, US$ 6 million; (ii) Avian and Human Influenza Facility grant, US $2 million; and (iii) Japanese PHRD grant, US $3 million. 15. Each IA will open and maintain two Designated Accounts, one for the IDA and AHIF grants (pooled together in the same DA), and a second DA for the funds from the PHRD grant, all in commercial banks acceptable to IDA. All funds from each source will be separately identified and accounted for by each IA in the accounting records and systems. The project accounting records will match each expenditure with the appropriate source of funding to account and report on uses by source o f funds. The project chart of accounts and reporting formats will be developed to make this possible. Implementing Agency MAFF - Component A MOH - Component B Designated Account for IDA and AHIF Designated (US$) Account for PHRD From IDA Grant From AHIF Grant (US$) 450, ,000 N.A. 105,000 35, ,000 NCDM - Component C 75,000 25, ,000 44

55 Disbursement Arrangements 17. The flow of funds will be through the Ministry of Economy and Finance s pass-through account (Single Treasury Account) in the National Bank of Cambodia (NBC) for further credit to the project Designated Accounts (DAs) to be opened by the IAs in commercial banks acceptable to IDA. The detailed procedures and mechanisms for operation of the pass-through account in NBC and for the establishment of DAs in commercial banks will be mutually agreed between the IDA and MEF. Until these details are agreed, during early stages of implementation the project will continue to use the existing arrangements consisting in disbursing to respective DAs for each IA in the NBC. 18. The withdrawal applications to be submitted will indicate clearly how much project expenditures will be claimed under each source of funds with the required reconciliations of the ledger accounts to the bank account balances. The withdrawal applications will clearly indicate that the AHIF financing (25percent of combined IDNAHIF financing for Components A, B and C) does not include any taxes and duties. The project will use transaction based disbursement procedures, using the designated accounts for most expenditures, with replenishment on the basis of statements of expenditures (SOEs). Direct payment methods may also be used for expenditures above the levels for SOEs (see below). 19 Use of SOEs. Some of the expenditures of the grants are expected to be disbursed on the basis of SOEs as follows: (i) civil works contracts costing less than $100,000 equivalent each; (ii) goods contracts costing less than $100,000 equivalent each; (iii) service contracts for firms costing less than $100,000 equivalent each and for individual consultants costing less than $50,000 equivalent each; (iv) training and workshops; and (v) operating costs. Disbursement for civil works, goods and services exceeding the foregoing limits will be made in accordance with respective procurement guidelines and provisions in the Financing Agreement against submission of full documentation and signed contracts. 20. As indicated in Tables 4, 5 and 6 (see also Attachment 1 to this Appendix), disbursements will cover the following: Disbursements from the PHRD Grant (US$3 million) will finance 100 percent of the expenditures (including taxes) corresponding to: (i) all Training and Workshops under Component B; (ii) all the Consulting Services for Components B and C; Disbursements from the IDA grant (US$6 million) will cover 75 percent of: (i) all expenditures for Component A for all categories; (ii) goods and incremental operating costs for Component B; and (iii) goods, training/workshops, and incremental operating costs for Component C. The IDA funding will cover all taxes and duties for these categories. Disbursements from the AHIF grant (US$2 million) will cover 25 percent of the same expenditures financed by the IDA grant for Components A, B and C. The AHIF funds will not cover taxes and duties. Retroactive Financing 21. Retroactive financing up to aggregate amounts not to exceed 10 percent of the funds available from each source of funding may be used for eligible expenditures incurred after February 15, The procurement of these activities should be done in accordance with the procedures agreed for the proposed project, as established in Appendix 5 to this document, as well as in the negotiated legal agreements. This provision will allow the project to be able to respond more forcefully to an eventual outbreak of the disease, or to strengthen surveillance activities at any moment when the risk of resurgence may be considered high. The Recipient is aware of the conditions of the retroactive financing and the risks associated with payments made in expectation o f this retroactive financing. This provisional agreement 45

56 does not commit IDA to the repayment of the expenditures, if the proposed grants are not approved, or to financing these payments if they are found non-eligible. Table 4: IDA Grant Financing Disbursement Categories and Disbursement Percentages. Disbursement CategoriedSubcategories IDA Grant Percentage of Allocation Expenditures (US$ thousand) (YO) 1. COMPONENT A: ANIMAL HEALTH 4, (a) Civil works 83 (b) Goods 963 (c) TrainingiWorkshops, 75 1 (d) Consulting Services 1,244 (e) Incremental Operating Costs 1, COMPONENT B: HUMAN HEALTH 1, (a) Goods 558 (b) Incremental Operating Costs COMPONENT C: PANDEMIC PREPAREDNESS I and PROJECT COORDINATION/MANAGEMENT (a) Goods 170 (b) TrainingiWorkshops 327 (c) Incremental Operating Costs 95 TOTAL IDA FINANCING 6, Table 5: AHIF Grant Financing Disbursement Categories and Disbursement Percentages. Disbursement Categories/Subcategories AHIF Grant Percentage of Allocation Expenditures (USS thousand) (YO) 1. COMPONENT A: ANIMAL HEALTH 1, (a) Civil works 28 (b) Goods (c) TrainingiWorkshops (d) Consulting Services (e) Incremental Operating Costs COMPONENT B: HUMAN HEALTH I (a) Goods I 186 I (b) Incremental Operating Costs COMPONENT C: PANDEMIC PREPAREDNESS I and PROJECT COORDINATION/MANAGEMENT (a) Goods (b) TrainingiWorkshops (c) Incremental Operating Costs TOTAL AHIF FINANCING ,

57 Disbursement Categories/Subcategories PHRD Grant Allocation (US$ thousand) 1. COMPONENT B: HUMAN HEALTH 2,089 (a) Training and Workshops 220 (b) Consulting Services COMPONENT C: PANDEMIC 911 PREPAREDNESS and PROJECT COORDINATION/MANAGEMENT (a) Consulting Services 911 TOTAL PHRD FINANCING 3,000 Percentage of Expenditures (YO) Staffing 22. For MOH, the existing finance unit in charge of the FM arrangements o f the on-going HSSP will be responsible for FM tasks of the Component B - Human Health. However, one additional financial management consultant will be added for this project. For MAFF and NCDM, a qualified consulting firm will be hired to install a computerized accounting software considered capable o f producing the financial reports required, and to provide training to the designated project financial staff. In addition, a financial consultant will also be recruited to support the day-to-day activity (2 years for MAFF and 18 months for NCDM). Two government staff at NCDM has been designated to the project. At least one government staff will have to be designated by MAFF. Accounting Policies and Procedures 23 The existing finance unit of the on-going HSSP has established accounting system (using Quickbook) and procedures satisfactory to the Bank. For MAFF and NCDM, a consulting firm will be employed to install a computerized accounting software and provide training until the system is in full operation. Their FM manuals cover requests for expenditure processing and describe financial policies and procedures for (a) planning and budgeting; (b) internal controls; (c) financial accounting systems; (d) control of petty cash; and (e) all routine financial management and related administrative activities. Internal Audit 24. The Internal Audit Departments (IAD) under MAFF and MOH were already established and currently staffed with 40 and 2 1 personnel respectively. KPMG was contracted to provide technical support and on-the-job training to the IAD of MOH since year To address financial risks and to provide management with advice on the effectiveness of financial systems and internal controls of the project, it is recommended that MAFF and MOH make arrangements for the project to be included in the program of review by their IAD and that the audit findings from review of the project be provided to the Bank. External Audit 25. The annual financial statements and designated accounts for the I As corresponding to the three components will be audited by independent auditors acceptable to IDA, working to terms o f reference acceptable to IDA. The audit TORS will cover both the annual audit of the project financial statements including their consistency with the quarterly IFRs, and a review of internal controls and compliance with 47

58 the legal grant agreements. The Auditor will be required to issue a management letter providing an assessment of the financial management system, including the adequacy of internal controls. The cost of audit is provided in the project budget for Component C and it will be paid out of project funds as an authorized expenditure. 26. At the end of each year, the NCDM finance unit will be responsible for compiling the consolidated project financial statements for three I As and to have it audited by the auditor. The audited financial statements must be submitted to the RGC and the Bank within six months of the end of the financial year. Reporting and Monitoring 27. Interim financial reports (IFRs) will have to be submitted to RGC and the Bank quarterly within 45 days after the end of each quarter by each implementing agency. As the IFRs will also be used as a monitoring tool, it will report project progress with adequate description and explanation and analysis of variances. IFRs will include reports on sources and uses of funds, the project financial position; project expenditures, physical progress compared with plan; and procurement monitoring. They will not be subject to audit. The three implementing agencies will follow the required format of the IFRs, which will be agreed at negotiations. Financial Management Action Plan 28. The following actions have been agreed upon: Actions Prepare and agree on a format for the Interim Financial Reports (IFRs). Recruit a qualified FM staff for each IA Adopt a Financial Management Manual, as part of the project s PIP, with accounting, financial management and audit procedures for the implementation of the project. Establish a computerized accounting system satisfactory to IDA at MAFF and at NCDM, to operationalize the procedures specified in the Financial Management Manual. Appoint independent auditor acceptable to IDA to carry out the audit of the annual financial statements for the entire project, under Terms of Reference satisfactory to IDA. Supervision Plan Responsible Agency Each IA and Bank Each LA NCDM, in coordination with the three IAs. MAFF and NCDM NCDM Completion date To be agreed at Negotiations Condition for Effectiveness Before June 30,2008. Before June 30,2008 Prior to the first audit period. 29. Financial management supervision will be undertaken twice a year by members of the regional FM team. Physical supervision on the ground will be supplemented by reviews of the quarterly interim financial reports and the annual audit reports, including the management letters describing the status of internal controls. Intensity of supervision will be reassessed after the first year of implementation. 48

59 ATTACHMENT 1 DISBURSEMENTS BY COMPONENT, BY CATEGORY AND SOURCE. PROJECT TOTAL Component and Disbursement Category A. Component A: Animal Health (MAFF) I Percentage Financed by Financing Allocated by Source Source (US$ Thousand) TOTAL IDA AHIF PHRD IDA AHIF PHRD I I I I I I I (YO) TOTAL PROJECT COST 11, , , ,

60 ATTACHMENT 2 FLOW OF FUNDS lo PROJECT ACCOUNT TOTAL = $11 million IDA = $ 6 million AHIF = $ 2 million -t PHRD = $ 3 million $. MEF Pass-through Account Component A MAFF One Designated Account: IDNAHIF $600,000 Suppliers Component B MoH Two Designated Accounts: IDNAHIF $140,000 PHRD $210,000 Contractors Suppliers Component C NCDM Two Designated Accounts: IDNAHIF $100,000 PHRD $100,000 1 Contractors Suppliers lo Does not include the direct payments to be done directly by IDA from the Grant Accounts to suppliers and Contractors, as requested by the Recipient, above the SOE thresholds. Until all detailed procedures and mechanisms for operation of the pass-through account in NBC and for establishment of Designated Accounts (DAs) in commercial banks have been mutually agreed between the IDA and MEF, the status quo of having Das in NBC will continue to be implemented to allow for early project execution. 50

61 Appendix 5: Procurement Arrangements CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project A. General 1. Procurement for the proposed project will be carried out in accordance with the World Bank s Guidelines: Procurement Under IBRD Loans and IDA Credits dated May 2004, revised October 2006, and Guidelines: Selection and Employment of Consultants by World Bank Borrowers dated May 2004, and revised October The general description of various items under different expenditure categories are described below. For each contract to be financed by the Grant, the different procurement methods or consultant selection methods, the need for prequalification, post-qualification, estimated cost, prior review requirements and time frame are agreed between the Recipient and the Bank project team in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. 2. Procurement of Goods: Goods under the project are expected to include vehicles, motorcycles, office equipment and furniture, communications equipment, etc. Goods estimated to cost equal or more than US$lOO,OOO shall be procured through the International Competitive Bidding (ICB) method and the procedures set forth in the Bank s Procurement Guidelines and using the Bank s applicable Standard Bidding Documents; except that motorcycles (for MAFF and MOH under Components A and B) and vehicles (for NCDM under Component C), estimated to cost less than US$150,000 equivalent per contract, may be procured under the method Procurement from United Nations Agencies (UNOPS). Goods estimated to cost less than US$ 100,000 equivalent per contract may be procured through the National Competitive Bidding (NCB) method and the procedures, including standard bidding documents, set forth in the Sub-decree 14 on Promulgating of the Standard Procedure for Implementing the World Bank and the Asian Development Bank Assisted Projects dated February 26,2007 and relevant provisions of the Royal Government of Cambodia Externally Assisted Project Procurement Manual for Goods, Works and Services, subject to the improvements listed in the Annex to the DGA. Goods estimated to cost less than US$20,000 equivalent per contract may be procured through the Shopping method and the procedures, including standard request for quotation documents, set forth in the aforesaid Sub-decree and Procurement Manual. 3. Procurement of Works: Works under the project are expected to include fitting and commissioning of new laboratory facilities and renovation of laboratory buildings under the Animal Health Component. The nature and small value of the works is not likely to attract international competition. Works shall be procured through National Competitive Bidding (NCB) method and the procedures, including standard bidding documents, set forth in the aforesaid Sub-decree 14 and Procurement Manual subject to the improvements listed in the Annex to the DGA. Works estimated to cost less than US$40,000 equivalent per contract, may be procured through the Shopping method and the procedures, including standard request for quotation documents, set forth in the aforesaid Sub-decree and Procurement Manual. 4. Selection of Consultants: Consulting services under the project are expected to include technical tasks, project management support including Financial Management and Procurement Specialists, project evaluation, external audit services, etc. Services requiring hiring of firms will generally be procured through Quality-and Cost-based Selection (QCBS) method. However, for assignments estimated to cost less than US$50,000 equivalent per contract the method Selection Based on Consultants Qualifications (CQS) may be used, and for external audit assignments the Least Cost Selection Method may be used. 51

62 Services for tasks under circumstances which meet the requirements of paragraph 3.10 of the Consultant Guidelines may, with the Bank s prior agreement, be procured through the Single Source Selection method. Services requiring hiring of individual consultants may be procured in accordance with the provisions of Section V of the Consultant Guidelines, whereas Single Source Selection of individual consultants may be done only with the Bank s prior agreement and under the circumstances described in paragraph 5.4 of the Consultant Guidelines. Shortlists of consultants for consulting services estimated to cost less than US$lOO,OOO equivalent per contract may be composed entirely of national consultants. The Bank s Standard Request for Proposals (RFP) document, including contact forms, shall be used for all assignments requiring international competition. Consulting Services contracts with UN agencies will follow the Standard Form of Agreement between IDA Borrowers and UN Agencies concerning the carrying out of consultants services financed by IDA, revised October 2007 for use only with Specific Avian Influenza Projects in accordance to the Batch Waiver approved by the Bank s MD on August 3, B. Assessment of the agency s capacity to implement procurement 5. The three Implementing Agencies (IAs) under the project are: (i) Ministry of Agriculture, Forestry, and Fisheries (MAFF), through its Department of Animal Health and Production (DAHP), for the Animal Health component; (ii) Ministry of Health, though its existing implementing unit of the ongoing Health Sector Support Project, (HSSP) for the Human Health component; and (iii) National Committee for Disaster Management (NCDM), through its General Secretariat, for the Pandemic Preparedness component. It was reconfirmed that NCDM will take overall responsibility for overseeing and coordinating the institutional and implementation arrangements for the project including overall project coordination and management, ensuring linkages across relevant agencies and with international partners, and for guiding and monitoring project implementation at the central level. 6. An assessment of the existing capacity of the three IAs to implement procurement under the project was carried out by the Bank in September It indicates that two IAs, MAFF and NCDM, have no prior experience in carrying out procurement under the Bank s Procurement Guidelines and also do not have suitable qualified staff dedicated for procurement. The third IA, MOH, by virtue of its existing implementation unit for the ongoing HSSP project, has adequate experience in the World Bank s procurement procedures but relies largely on one individual procurement consultant who was hired primarily for providing procurement support to that project. To address the inadequate of procurement capacity of the IAs, and consistent with the government s decision to require the IPA for all WB-financed projects in Cambodia, it was agreed that all procurement under the project, with the exception of single source selection and procurement from UN agencies, will be carried out by the International Procurement Agent (PA). Single source selection and procurement fi-om UN agencies has been excluded fi-om the IPA s scope because the use o f these methods, once agreed by the Bank, does not involve undertaking a competitive process and therefore using the PA and paying its service fee for procuring these contracts would not be an effective use of the available resources and would also go against the principles of economy of the Bank s Guidelines. It was also agreed that at least one qualified individual would be appointed by each IA as Procurement Coordinator to serve as the focal point for coordination and followup of procurement activities between the implementing agency, PA, MEF, and the Bank. In case that qualified government staff are not available a local individual consultant will be engaged by the IA. In addition Bank staff will provide training as needed during the life of the project. 7. The high fiduciary risks in Cambodia in the context of the weak governance environment in the country, including procurement, are expected to be mitigated through a range of strengthening measures that have been built into the project s design. These include implementation of a Good Governance Framework (anti-corruption action plan) - included in Appendix 10 to this Technical Annex, which has been endorsed by all three project IAs and includes elements for increasing public disclosure, complaints 52

63 mechanism, integrity pacts, involvement of civil society, strengthened financial management and procurement arrangements, and redress of project-specific implementation needs. The strengthened procurement arrangements include required use of the PA, application of Kingdom of Cambodia s Standard Procurement Manual for Externally Assisted Projects, including Standard Bidding Documents, which in itself requires numerous measures for further enhancing transparency and accountability in NCB, Shopping and nationally competitive consulting services procurement, an NCB-Annex requiring additional procedural improvements, rationalized thresholds to reduce use of less competitive methods such as Shopping, bulk of the competitive procurement by value to be done through ICB, expanded scope of post-reviews by the Bank to include checks for indicators of collusion and end-use deliveries in addition to verifying procedural compliance, and oversight by RGC s Anti-Corruption Working Group for World Bank financed projects. 8. With incorporation of the capacity strengthening measures and widespread requirements for improving governance and increasing transparency and accountability in the procurement process, the residual procurement risk under the project is Moderate. C. Procurement Plan 9. For project implementation the Recipient has developed the initial procurement plans, attached to this Appendix 5, which provide the basis for the selected procurement methods. This plan has been agreed between the Recipient and the Bank. The plan will be updated in agreement with the Bank at least annually as required to reflect the actual project implementation needs and improvements in institutional capacity. D. Frequency of Procurement Supervision 10. In addition to the prior review supervision to be carried out by the Bank, the capacity assessment of the Implementing Agency recommends that procurement supervision missions, including ex-post review, be conducted at least twice per year. E. Prior Review Requirement 11. The following contracts will be subject to prior review by the Bank: (a) each contract for goods and works estimated to cost the equivalent of US$lOO,OOO or more; (b) the first contract each for goods and works procured by each implementing agency under National Competitive Bidding (NCB) procedures; (c) each contract for consultants services provided by a firm estimated to cost the equivalent of US$ 100,000 or more; (d) each contract for the employment of individual consultants estimated to cost the equivalent of US$ 50,000 or more, and (e) each contract involving Single-Source Selection o f firms, organizations, or individual consultants, irrespective of value, shall be subject to prior review by IDA. All other contracts shall be subject to ex-post review by the Bank. The percentage to apply for contracts subject to ex-post review is 30 percent. 53

64 Estimated cost (US% m) Appendix 5 Attachment 1 Details of the procurement involving International Competition, Direct Contracting, Procurement from UN Agencies, or Single Source Selection Goods: (a) List of contract packages which will be procured following ICB, Direct Contracting or Procurement from UN Agencies methods. nponent A - Ministry of Agriculture, Forestry, and Fisheries I Is 19 Contract (Description) Station wagons and P ick-up Vehicles Motorcycles 790,000 Procurement Method ICB 110,000 1 UNO;? P-Q No No I Domestic Review Expected Preference by IDA Bid- (yedno) (Prior / Invitation Post) Date Yes Prior Jan 08 No I Prior I Jan 08 4 Comments Ref. No Contract Estimated Procurement P-Q Domestic Review Expected Comments (Description) cost Method Preference by IDA Bid- (US$ m) (yes/no) (Prior / Invitation Post) Date Pickup vehicles 525,000 ICB No Yes Prior Feb 08 Motorcycles 115,500 UNAgency No No Prior Feb 08 (UNOPS) Component C - National Committee for Disaster Management Is 19 Ref. No. 1.1 Contract (Description) 4 WD Vehicles Estimated cost (US% m) Procurement Method 100,000 UN Agency (UNOPS) P-Q Domestic Preference (yesho) 1 1 Review Expected byida Bid- (Prior / Opening Post) Date Prior Jan 08 I I Comments 54

65 @) All contracts procured under ICB, Direct Contracting or Procurement from UN Agencies methods shall be subject to prior review by IDA. Consulting Services (a) List of consulting assignments which will be selected following international competition or Single Source Selection method. Component A - Ministry of Agriculture, Forestry, and Fisheries 1 Ref. No Description of Estimated Selection Review Expected Duration Assignment cost (US$) Method by IDA Proposals (Prior / Invitation Post) Date 1 Technical Assistance Prior Services contract with the Food and Agriculture Organization (FAO) * Subject to satisfactory justification for SSS being provided by MAFF in accordance with the Consultant Guidelines Paras.3.10 Component B - Ministry of Health No. Assignment 3 Estimated cost (US$) 4 Selection Method 7 Duration Post) 1 I Technical Assistance Services Contract with World Health Organization (WHO) 1,378,306 sss* Prior I Jano8 3 years * Subject to satisfactory justification for SSS being provided by MOH in accordance with the Consultant Guidelines Para

66 Component C - National Committee for Disaster Management 1 cost (US$) Technical Assistance 292,950 Services Contract with agency from the United Nations System 4 Selection Method sss* 5 Review by IDA (Prior / Post) Prior 6 Expected Proposals Submission Date Jan 08 7 I Duration 73 Years * Subject to satisfactory justification for SSS being provided by NCDM in accordance with the Consultant Guidelines Para (b) Each contract for consulting services exceeding $100,000 for firms and $50,000 for individuals, and each contract involving Single-Source Selection of firms, organizations, or individual consultants, irrespective of value, shall be subject to prior review by IDA. 56

67 Appendix 5 Attachment 2 National Competitive Bidding Procedures 1. The procedure to be followed for National Competitive Bidding shall be those set forth in the Sub-decree 14 on Promulgating of the Standard Procedure for Implementing the World Bank and the Asian Development Bank Assisted Projects dated February 26,2007 and relevant provisions of the Royal Government of Cambodia Externally Assisted Project Procurement Manual for Goods, Works and Services with modifications set forth below in order to ensure economy, efficiency and transparency and broad consistency with the provisions of Section I o f the of the Guidelines for Procurement under IBRD Loans and IDA Credits published by the Association in May 2004 and revised in October 2006 (the Guidelines) as required by paragraph 3.3 and 3.4 of the Guidelines. Eligibility 2. The eligibility of bidders shall be as defined under Section I of the Guidelines; accordingly, no bidder or potential bidder shall be declared ineligible for contracts financed by the Association for reasons other than those provided in Section I of the Guidelines. Foreign bidders shall not be asked or required to form joint ventures with national bidders in order to submit a bid. Bidders located in the same province or city as the procuring entity shall not be given preference over bidders located outside that city or province. Qualification Criteria 3. The assessment o f the qualification of a bidder shall be conducted separately from the technical and commercial evaluation of the bid and in strict adherence to the qualification criteria that shall be clearly specified in the bidding documents. Such assessment shall only take into account a bidder s capacity and resources to perform the contract, specifically its experience and past performance on similar contracts, capabilities with respect to personnel, equipment and construction and manufacturing facilities, and financial capacity. Bid Submission, Bid Opening and Bid Evaluation 4. The evaluation of a bid shall be made in strict adherence to the criteria that shall be clearly specified in the bidding documents and quantified in monetary terms for evaluation criteria other than price; merit points shall not be used in bid evaluation. 5. No bidder shall be rejected on the basis of a comparison with the Borrower s estimate and budget ceiling without the Association s prior concurrence. 6. A copy of the minutes of the public bid opening shall be promptly provided to all bidders and to the Association with respect to contracts subject to prior review. 7. Neither shall all bids be rejected nor shall new bids invited without Association s prior written concurrence. Complaints by Bidders and Handling of Complaints 8. The Borrower shall implement an effective and independent protest mechanism allowing bidders to protest and to have their protests handled in a timely manner. 57

68 Fraud and Corruption 9. The Association shall declare a firm or individual ineligible, either indefinitely or for a stated period, to be awarded a contract financed by the Association, if it at any time determines that the firm or individual has, directly or through an agent, engaged in corrupt, fraudulent, collusive, coercive or obstructive practices in competing for, or in executing, a contract financed by the Association. Right to InspectlAudit 10. Each bidding document and contract financed from the proceeds of a Credit shall include a provision requiring bidders, suppliers, contractors and subcontractors to permit the Association, at its request, to inspect their accounts and records relating to the bid submission and performance of the contract and to have said accounts and records audited by auditors appointed by the Association. The deliberate and material violation by a bidder, supplier, contractor or subcontractor of such provision may amount to obstructive practice. 58

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75 Appendix 6: Environmental Analysis CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project 1. Cambodia's Experience with Responding to Avian Influenza Outbreaks 1. Two distinct systems in the Cambodian poultry sector exist: the small-scale backyard system, and the commercial system. The backyard system dominates the poultry sector in terms of the number of farms and overall number of poultry. This includes the subsistence farmers who own a small number of poultry mainly for personal consumption and also some sales in local markets. Of those households with poultry, some 80 percent keep only chicken, 19 percent keep chicken and duck, and 1 percent keep only duck. The commercial sector has less than 1 percent of the total number of farms, and about 10 percent of the national flock, which is estimated to be about 16.3 million birds. The Thai firm CP has the largest farm in Cambodia (in Kandal) with 100,000 layers. This company also dominates the broiler sector. The most important poultry populations in Cambodia are found in Pursat (15 percent), Takeo (11 percent), Kampong Cham (10 percent), Kandal (8.6 percent), Prey Veng (8.6 percent), Kampot (7 percent), and Kampong Speu (7 percent). 2. Cambodia was one of the first counties in Southeast Asia to experience HPAI infection. The first case of HPAI in Cambodia was reported in December 2003 in the Takmao Wildlife Rescue Center (45 km south of Phnom Penh), and the first wave of outbreaks occurred during January to May 2004 in five provinces (Takeo, Kandal, and Siem Reap, and Kampong Cham) and Phnom Penh, having severe impacts on smallholder farmers who raise the majority of the country's poultry under subsistence conditions and on small-scale commercial poultry farms. HPAI cases emerged again in late 2004 and early Subsequently, there was one confirmed outbreak among chicken, ducks and fighting cocks in February 2006, and this outbreak was quickly contained (about 2,500 birds were lulled by disease or culled). Four human cases in Kampot (2005) and two human cases in Kompong Speu and Prey Veng (2006) occurred. All these human cases were fatal. 3. Provincial and district animal health officers, and VAHWs under the supervision of DAHP, implemented a number of animal health measures in order to contain these disease outbreaks. These measures included control of the movement of poultry and poultry products, culling, disinfection, field investigation, field epidemiological surveillance and sampling. The procedures used to carry out these measures were as follows: Use of personal protection equipment (PPE) and disinfection/disuosal of used PPE. PPE was used at farms where AH1 outbreaks occurred and were suspected to occur (i.e. those farms where poultry was culled). Each worker wore one plastic coverall. There was no change of coveralls during the day as the workers did not leave the work area or take any breaks (e.g. lunch break) until they finished their daily work. Other PPE used included gloves, masks, goggles, and boots. All used PPE, except for goggles and boots, were disposed of at the end of the daily work by placing them in plastic bags, which were tightly closed and buried on site." However, goggles and boots were disinfected with TH4 to be reused. After finishing work, all workers washed their hands, although there were no shower facilities in the field. The above-mentioned procedures relate to culling of poultry during AH1 outbreaks. However, to carry out their regular AH1 surveillance work, each VAHW was distributed a PPE lut, which is reused after washing in a disinfectant solution. The VAHWs have been trained on the use and disinfection of the PPE kits. 11 It is important that the PPE or the disinfectant be free of chlorine if the disposal method for used PPE involves cremation or incineration. 65

76 Culling ofpoultry. At all reported locations with AH1 outbreaks, poultry were killed (culled) by breaking their necks and, in a few instances, by lethal injection. All culled poultry were put in plastic bags for disposal. Disinfection of farm surfaces, equipment and materials. All potentially infected surfaces, materials and equipment at farms with outbreaks were sprayed with TH4 (a disinfectant recommended by FAO). Management of poultry feces. At semi-commercial and commercial farms with suspected or confirmed AH1 cases, feces were collected from the poultry houses and placed in a pit for composting. The composted materials will then be sold as fertilizer. On-site disuosal of carcasses. For locations where the groundwater table was low, the carcasses were disposed of on site or within the village area. At the disposal site, a pit was dug using an excavator. Bags containing carcasses were placed into the pit and then cremated using kerosene. After cremation, the ash was covered first with lime and then with soil to the ground level. The disposal area was sprayed with an FAO-recommended disinfectant (TH4) and then covered with a mesh-wire to prevent disturbance of the disposal area by animals. Transuortation and offisite disposal of carcasses. For locations where the groundwater table was high, the carcasses were transported by a pick-up truck to another location for disposal. The pickup truck was disinfected before placing the bags into the truck (at the first location, before transportation) and also after removal of the bags from the truck (at the disposal location, after transportation). The off-site disposal procedure was the same as the on-site disposal procedure. Transportation of animal specimens to the NVRT laboratory. All animal specimens were placed in an ice box and carefully taped before being shipped to the NVRI laboratory in Phnom Penh for testing. Waste management at the NVRT laboratory. The NVRI laboratory personnel testing for AH1 use PPE based on WHO training. Needles are separately collected in bottles and incinerated on site along with other wastes (including animal carcasses, cotton swabs, used PPE). Overall, waste management practices are inadequate, and waste segregation is not properly implemented. There are no written guidelines on the use of PPE and waste management. The design of the incinerator is rudimentary and maintenance is inadequate (the chimney is in disrepair, and the surroundings of the incinerator are littered with ashes, plastic bags, and empty bottles). As proper waste segregation is not practiced and the incinerator is not equipped with adequate controls, incineration of any chlorinated materials (within the composition of PPE or disinfectants) might generate dioxins or furans. MAFF, with FAO s support, published a manual entitled Surveillance and Control of Bird Flu at Village Level-Guide for VAHW. This manual, which contains useful information, would benefit from updating, with some reorganization based on specific targeted audiences. 2. Institutional Framework 5. Environmental Management. The Ministry of Environment (MOE) is the key agency responsible for environmental protection and natural resources conservation, while MAFF is responsible for forest management. Since its creation in 1993, MOE has developed and enhanced a policy system and legal framework to strengthen environmental protection and natural resources conservation. Within MOE, the General Technical Directorate is responsible for coordinating and managing the Ministry s line departments, including the Departments of Planning and Legal Affairs, Nature Conservation and Protection, Pollution Control, Natural Resource Assessment and Environmental Data Management, and 66

77 Environmental Impact Assessment. The Provincial Environmental Departments and District Environmental Offices are responsible for the implementation and coordination of MOE s activities at the local level. Approximately, one third of MOE s staff works in Phnom Penh, while the remaining twothird is employed in the provincial and district offices. MOE shares some environmental management responsibilities with MOH and the Ministry of Water Resources Management. 6. Animal Health Services. MAFF comprises a central level organization, a provincial level organization, and public institutions (a university, colleges, a research institute, and companies). The central level organization is headed up by the Minister and consists of the General Inspector s Office and 12 departments, one of which is DAHP. DAHP is responsible for animal health services and has the major role in the management of animal health disease outbreaks. The national structure provides technical support to the Offices for Animal Health and Production (OAHP) in the 24 provinces and municipalities. 7. DAHP consists of the Animal Health Office (AHO) and Animal Production Office (APO) in addition to finance, planning and administration units. Veterinary epidemiological and diagnostic services are provided by NVRI. The mandate of NVRI is to conduct surveillance and research, investigate disease outbreaks, and consolidate information on all matters pertaining to animal health and production and food safety. NVRI functions as a national reference center for diagnostic and epidemiological services. NVRI s diagnostic services encompass a total of 28 staff in the serology, epidemiology, parasitology, pathology, bacteriology, hematology, and biochemistry laboratories, and the administration unit. 8. Public Health Services. MOH is in charge of human health services in Cambodia. Under the Directorate General o f Health, the Department of Communicable Disease Control (CDC) is responsible for the management o f AH1 in Cambodia. There are 24 provincial health departments and 76 operational districts for health services. The health infrastructure includes 8 specialized hospitals with a total of 1,770 beds, 68 district/first level referral hospitals with 5,712 beds, and 961 primary healthcare centers. The health workforce includes 2,122 doctors, 241 dentists, 4,5 16 nurses, 4,449 other nursing/auxiliary staff, 160 paramedical staff (e.g. medical assistants, laboratory technicians, and x-ray technicians), 1,836 other health personnel (e.g. health inspectors, assistant sanitarians), and 1,754 midwives. AHI Surveillance. The influenza surveillance system is designed to collect information on a sample o f persons with ILI, which may include persons with suspected AHI. Through surveillance, the infectious agent may be identified with confirmation of any circulating strains o f influenza. In addition, the influenza surveillance system provides background epidemiological data on ILI and identifies severe cases of the influenza disease through pneumonia surveillance. The ILI (including HPAI) surveillance system is currently being established at one hospital at each o f the four sentinel locations in Cambodia (in Battambang, Kampong Cham, Takeo, and Phnom Penh), relying on the existing structure and processes of dengue fever sentinel surveillance based on the existing partnership between the MOH s Communicable Disease Control (CDC) and the Pasteur Institute (IPC) in Phnom Penh. Currently IPC is the only laboratory in Cambodia that can perform rapid and reliable testing for H5N1 and other respiratory pathogens, with confirmation within 24 hours. IPC also sends all samples to the Pasteur Institute in Paris, which is a WHO Collaborating Center, for comparison of the test results with the global strains and confirmation of the test results. AHI Investigation. Once an HPAI alert has been raised through the hotline or through detection of a severe pneumonia case at a hospital, two CDC staff from the province ( Rapid Response Team ) visit the village to assess the situation and take a sample. The sample is then sent to IPC in Phnom Penh by taxi under preserved conditions for analysis. If the sample is found to be positive, then an investigation is launched immediately in the field by the staff of MOH s CDC, IPC, and WHO jointly with the provincial and operational district staff. In the field, the survey 67

78 fondquestionnaire is filled out. IPC staff takes samples and take along the preserved samples to IPC at Phnom Penh for analysis. HPAI Infection Control. There are two national referral hospitals for AH1 in Cambodia: (1) Calmette Hospital (in Phnom Penh), and (2) Siem Reap Referral Hospital. In addition, the provincial hospitals from the following high risk provinces will be upgraded as referral hospitals to admit potentially AHI-infected patients: (1) Kampong Cham, (2) Kampot, and (3) Stung Treng. Five isolation rooms to receive five patients in the Calmette Hospital, which were dedicated to receive SARS patients, are now available for AH1 patients (although currently used by the Cardiology Department). In addition, at the Siem Reap Hospital there are six isolation rooms. Sewerage from the isolation rooms in both hospitals is collected and chlorinated before joining the sewerage from the other sections of the hospital. 3. Legal Framework 9. Environmental Asvects. Between 1993 and 1996, the Government of Cambodia enacted several key pieces of environmental legislation to establish the legal framework to control, use and manage its natural resources and urban environment. These include: Law on the Environmental Protection and Natural Resources Management (January 9, 1977) Sub-decree on environmental Impact assessment Process (August 1 1, 1999) EIA Process for Proposed Project Approved by Royal Government or CDC Prakas (Declaration) on Guideline for Conducting Environmental Impact Assessment Report (March 9,2000) Guideline for Conducting Environmental Impact Assessment (EIA) Report Base of Environmental Impact Assessment in Cambodia Sub-decree on Water Pollution Control (April 6, 1999) Sub-decree on Solid Waste Management (April 27, 1999) Sub-decree on Air and Noise Pollution Control Prakas (Declaration) No on Protected Areas (June 3, 1994). 10. The sub-decree on Solid Waste Management lists infectious diseases wastes as hazardous wastes. 11. Animal Aspects. The legal measures to control AH1 in Cambodia are as follows: On January 12, 2004, MAFF issued the movement control measure of poultry and its products from neighboring countries and ordered the field investigation on poultry farms in Cambodia. On January 16, 2004, the control checkpoints were re-established and MAFF issued a declaration for nationwide prevention of introduction of HPAI. On January 22, 2004, the PM announced creation of an inter-ministerial committee on AH1 at the national level. In May 2005, the Minister of MAFF announced all provinces to establish a provincial multisectoral committee on AH1 control. 68

79 12. Human Hvaiene/Environmental Aspects. 0 MOH s Infection Safety Guidelines for Referral Hospitals (January 31, 2001) includes guidelines for the distribution, use, collection, and safe destruction of disposable syringes and safety boxes. 0 MOH s Directive to Head of Healthcare Establishments (January 3, 2003) regarding segregation of healthcare wastes at their establishments into (i) sharps, (ii) infectious wastes, and (iii) common wastes (garbage); and cooperation with the national, provincial, district or municipal authorities for safe management of these wastes. 0 MOH s Directive (December 22,2003) regarding the requirements for: (i) the development of a healthcare waste management plan at each healthcare establishment, (ii) the segregation of wastes into infectious wastes, sharps and common waste (garbage) at these establishments; and (iii) the collection of sharps wastes in safety boxes and destruction of filled safety boxes by incineration at the premises of the healthcare establishments. The Directive states that the responsibility for the destruction of safety boxes is with the provincial or city Health Department Director, and the expenses will be covered from either the national budget or funds from partner organizations. The Directive also indicates that the segregated wastes generated by the private healthcare establishments may be destroyed by the public healthcare establishments for a fee. 4. Potential Environmental Impacts. 13. The project is not expected to have any large-scale, significant and/or irreversible environmental impacts as it is focused largely on public sector capacity building and strengthening readiness for dealing with outbreaks of avian influenza (AHI) in domestic poultry as well as preventing or reducing possible human infections by strengthening emergency preparedness and response. In addition, the project design incorporates other beneficial measures such as improved biosecurity in farms and live markets, and control of poultry movement within and across countries. The project s preventive activities (funding of facilities, equipment, laboratories, procedures, and training programs), aimed at improving the effectiveness and safety over the existing the AH1 practices, will have positive human health and environmental impacts. As such the project is assigned an Environmental Category B. 14. The project only triggers the Bank s safeguards policies on Environmental Assessment (OP 4.01) and Indigenous Peoples (OP 4.10). The project is being processed under OP 8.50, Emergency Recovery Assistance, and the task team has received concurrence from the EAP Vice President to delay preparation and disclosure of the Environmental Management Plan (EMP) and Ethnic Group planning framework (EGPF) under the exception granted under OP 4.01, paragraph 12, and OP4.10, paragraph 15. Environmental Assessment (OP 4.01). The key environmental and personal hygiene issues include: (i) disease transmission from animals during response to AH1 outbreaks in the field (e.g. culling of poultry; selection of appropriate disinfectants for disinfection of contaminated farm areas; transportation of farm wastes and carcasses (if necessary); management and disposal of farm wastes, animal carcasses and used PPE; and packaging and shipment of specimens); (ii) management of wastes and personal hygiene at the laboratories of NVRI (iii) management of wastes and personal hygiene as well as cleaning of hospital grounds at five hospitals to be receiving potentially AHI-infected patients; and (iv) civil works associated with the expansion of the NVRI laboratory and construction of isolation rooms at three hospitals to be receiving potentially AHI-infected patients. A draft EMP has been prepared and will be finalized by the government. 69

80 Pest Management (OP 4.09). This Bank policy is not applicable because the project will not procure pesticides nor will increase use of pesticides will result from the project. However, the chemicals to be used for the disinfection of farm facilities/personal protection equipment will be evaluated on a case by case basis for conformity with the OP 4.09 for Pest Management. The selected disinfectants will conform to the Bank s Pest Management Policy. Use of hazardous disinfectants will necessitate providing training in safe transport, handling, and application. Physical Cultural Resources (OP 4.11). This Bank policy is not triggered because the project will not affect sites with archeological, paleontological, historical, religious, or unique natural values in the project area. However, appropriate clauses will be included in all construction contracts regarding the procedures to be followed in the event of chance find of culturally significant artifacts or sites. Public Disclosure (BP 17.50). Because the project is being processed under OP 8.50, Emergency Recovery Assistance, safeguards issues will be addressed through the use of accepted good practice and sound design principles. Safeguards documents will not be prepared prior to appraisal. The draft documents will be disclosed as they are prepared and again when they are finalized. 5. Environmental and Human Health Impacts and Mitigatory Measures to be addressed under the Government s AHI Program and the Project 15. The potential environmental impacts and mitigation measures to be addressed under the government AH1 Program, including this project, are described below. All of these mitigation measures have been incorporated into the design o f this program/project. A draft Environmental Management Plan (EMP) has been prepared. The draft EMP will be revised after consultation with various stakeholders (government s agencies, the commercial poultry associations, mass organizations, and NGOs) and finalized during project implementation. The finalized EMP will then be disclosed within Cambodia and in Washington D.C. (at the Infoshop), and the project legal grant agreement will reflect implementation of the EMP. 16. ComDonent 1: Animal Health. The main environmental and personal hygiene issues under the Animal Health Component of the government s AH1 Program and the project are associated with the following activities: 0 Design and construction of the building extension for NVRI. Personal hygiene at NVRI s laboratories Shipment of animal specimens locally and to an international laboratory Management of wastes generated at NVRI s laboratories Response to AH1 outbreaks. 17. Design and Construction of the building; extension for NVRI. The existing NVRI building will be expanded for the serology/virology laboratory. The new laboratory will be able to perform a range of internationally approved diagnostic tests for both Highly Pathogenic Avian Influenza (HPAI) virus and antibody. The adverse impacts during construction will include dust and noise emissions, generation o f construction waste, and disturbance of traffic. These adverse impacts will be mitigated by including in the construction contract a clause regarding observation of standards for good construction practices. Construction will be supervised to observe compliance with these good construction practices. 70

81 18. Personal hygiene at NVRI s laboratories. The safety and quality assurance/quality control (QA/QC) systems at NVRI s laboratories (particularly, the serology/virology laboratory) will be assessed to bring the laboratory in line with international bio-safety and quality standards. The necessary personal protection equipment (PPE) will be procured and the serology/virology staff will be trained on test methods, personal hygiene, and QA/QC systems. 19. Shiument of animal suecimens to an international laboratory. SOPs will be prepared for packaging, labeling, and shipment o f animal specimens from NVRI to an international laboratory (e.g. in Geelong, Australia) for analysis. These SOPs will be fully compatible with the IATA regulations. The NVRI personnel will be trained on these SOPs. 20. Management of wastes generated at NVRI s laboratories. Waste management practices at the NVRI laboratories will be strengthened. This will require that the current waste management practices at NVRI laboratories be assessed to identify the needs. A written waste management plan for NVRI s laboratories will be prepared with segregation and treatment/disposal of wastes. The most suitable waste treatment/disposal system for NVRI will be determined after assessment of the existing incineration system and consideration of state of-the-art treatment/disposal technologies. Specifications for the recommended technology will be prepared for purchase. The proposed system will be procured, installed, and test run (with pollutant sampling and analysis). The necessary waste management supplies will be purchased. The personnel operating the waste management system will be trained. 21. Resuonse to AH1 outbreaks. The information contained in MAFFDAHP s manual for response to AH1 outbreaks will be updated for different audiences, including: (i) the VAHW; (ii) MAFFDAHP s district and provincial veterinary staff, (iii) the commercial farm owners; and (iv) backyard farm owners. In addition, the general public will be informed about AH1 through the information, education and communication (IEC) campaigns. The manual to respond to AH1 outbreaks by DAHP s provincial and district veterinarians will be presented in the form of Standard Operating Procedures (SOPs). The manual will address, at a minimum, the following is sues : (a) Packaging and shipment of animal specimens to NVRI. It is important that the animal specimens be packaged, labeled, and shipped in such a manner to avoid the spread o f AHI. Animal specimens will be shipped for analysis at NVRI in Phnom Penh. The international regulations for packaging, labeling and shipment o f biological specimens will be adopted and included in the SOPs. Provincial and district veterinarians will be trained on these SOPS. (b) (c) Culling of poultry. It is important that culling of poultry be conducted in a humane, safe, and efficient manner. The following methods for culling poultry were identified from the OIE/FAO guidelines: (a) neck breaking (manual), (b) neck cutting (using mechanical devices), (c) gassing with inhalation agents (e.g. carbon dioxide), (d) electrocution, or (e) poisoning. Based on consideration for humane, safe and efficient culling and experience from the previous AH1 outbreaks in Cambodia, the most appropriate culling methods will be selected for chickens and ducks in backyard farms with few numbers of birds, and for commercial farms with large number of birds. The SOPs will specify the criteria for using one versus the other method; and will provide the design and operating requirements if the gassing systems are selected (e.g. specific locations and quantities of stocked carbon dioxide). Selection of disinfectants. It is important that the disinfectants to be selected for the disinfection of farm surfaces, equipment, materials, and wastes do not have adverse 71

82 impacts on the environment and human health. The selection of disinfectants will be based on such criteria as effects of disinfectants on human health and the environment, availability and costs of the disinfectants in Cambodia, and compatibility of the disinfectants with the disposal methods of the wastes (e.g. chlorinated disinfectants should not be used if the disposal method is crematiodincineration). The selected disinfectant, which will be specified in the SOPs, will comply with the World Bank s Pest Management Policy (OP4.09). (d) Disinfection of farm surfaces, equipment and materials. Based on selected disinfectant, the equipment and procedures for preparing (e.g. dilution with water) and applying the disinfectant will be specified in the SOPs. (e) (f) (g) (h) Disposal of animal carcasses. It is important that the selected disposal method(s) for animal carcasses does(do) not have adverse impacts on human and the environment. For example, improper burial practices may cause contamination of ground or surface water, and poorly designed and/or operated cremation or incineration systems may create particulate emissions and objectionable odors. The following options for the disposal of poultry carcasses were considered: (i) burial in a pit, (ii) open air burning (cremation), (iii) composting, (iv) incineration at a fixed location, and (iv) mobile incineration. Incineration (mobile or at a fixed location) was eliminated based on cost considerations. Among the remaining options, based on experience from the previous AH1 outbreaks in Cambodia, cremation in a pit was selected as the disposal method for animal carcasses. However, criteria will be developed and included in the SOPs for the applicability of this disposal option for specific sites. These criteria will include such considerations as: (i) the height of the water table (the base of the pit must be at least 1 meter above the water table), (ii) dry weather conditions (dry season), (iii) prevailing wind direction (for odor emissions), (iv) availability of space for temporary storage of excavated soil, and (v) accessibility of site by digging equipment (e.g. excavator). For those situations where the criteria for on-site cremation are not met (wet weather conditions, high water table), the SOPs will specify the most appropriate, environmentally-safe, and cost-effective disposal option for Cambodia (e.g. transportation and cremation at another site). The SOPs will provide the design (depth of the pit) and construction requirements for cremation of carcasses and burial of ashes. Treatment of poulty feces. Is important that composting - as the selected method for treatment and reuse of poultry feces - does not have adverse impacts on human and the environment. The SOPs will specify the procedures and the minimum time for composting of feces before use as a fertilizer. Disinfection/disposal of used PPE. Used PPE - except for boots and gloves - during AH1 outbreaks have been disposed of through on-site burial. This option along with cremation will be evaluated for the disposal of (disposable) used PPE. It is important that the PPE or the disinfectant not to contain any chlorine if the cremation method is selected. The SOPs will describe step-by-step procedures for the disinfection (including preparation of the disinfection solution) of used PPE. Transportation of animal carcasses and farm wastes (ifnecessa y). If proper measures are not taken, transportation of AH1 infected animal carcasses and farm wastes would likely spread the virus outside of the infected farm areas. Under this project, transportation of carcasses and farm wastes to another site for disposal will be avoided to the maximum extent possible. However, if transportation is required, then the SOPs will specify the specific requirements for vehicle design and operation as well as containment of carcasses and farm wastes for transportation. These SOPs will also include decontamination of 72

83 vehicle surfaces (e.g. tires) prior to exiting the farm and after unloading the animal carcasses at the new site. (i) Personal hygiene. If proper hygiene measures are not taken, AH1 may spread to humans. For this reason, for each of the above-mentioned activities to be conducted during AH1 outbreaks, the SOPs will specify the level of protection (e.g. gloves, masks, coveralls, boots) to be used. 22. DAHP's provincial and district veterinarians will be trained on these SOPs. 23. Component 2: Human Health. The main environmental and personal hygiene issues under the Human Health Component of the government's AH1 Program and the project are associated with the following activities: Personal hygiene and waste management at sentinel surveillance locations Personal hygiene and waste management by the Rapid Response Teams Shipment of samples from sentinel locations to the Pasteur Institute in Phnom Penh Personal hygiene and waste management at Pasteur Institute in Phnom Penh International shipment of samples. Personal hygiene at the referral hospitals Construction of isolation rooms at three referral hospitals Healthcare waste management at hospitals to be receiving potentially AHI-infected patients Personal hygiene during a potential pandemic. 24. Personal hygiene and waste management at sentinel surveillance locations. Based on MOWWHO/IPC's guidelines, written guidelines have been developed for the surveillance o f ILI at the sentinel locations in Battambang, Kampong Cham, Takeo, and Phnom Penh. The personnel at each sentinel location are being trained on these guidelines and will be provided with PPE. These guidelines will be expanded to include waste management at these locations. Personnel at each sentinel surveillance location will be trained on these guidelines. 25. Personal hygiene by the Rapid Response Teams. If proper hygiene measures are not taken, AH1 may spread to humans through contact with the AHI-infected poultry or contaminated environment. For this reason, members of the Rapid Response Teams who are conducting the investigation will be provided with PPE. The Rapid Response teams will be trained on the use of PPE. 26. Shipment o f samples from sentinel locations to the Pasteur Institute in Phnom Penh. The ILI surveillance system, which is based on the existing dengue surveillance system, has written procedures for storage (at 4"C), packaging (in liquid nitrogen) with the appropriate information (laboratory forms), and shipment of the samples by the Pasteur Institute-hired taxi (each week with the dengue samples) from the sentinel locations to the Pasteur Institute in Phnom Penh. The staff has already been trained on these procedures. No additional strengthening will be required in this area. 27. Personal hygiene and waste management at Pasteur Institute (IPC). If proper hygiene measures are not taken, AH1 may spread to humans. For this reason, IPC in Phnom Penh, which already has four biosafety Level 2 laboratories, i s constructing a new biosafety Level 3 laboratory (microbiology and retrovirology laboratory for AHI, SARS, and dengue) through its own resources 73

84 for analyses of human and animal specimens.12 IPC has developed written guidelines for testing of specimens, including personal protection. The personnel at IPC have been trained on these guidelines. IPC procures PPE through various resources, including its own funds generated from laboratory services and funds received from international sources (Government of France, Government of USA, and European Commission). Waste management procedures, which have already been developed at IPC, will be strengthened through IPC s own resources. However, the current infectious waste disposal practice, which is by incineration in a poorly designed incinerator, will be improved through joint treatmentldisposal of infectious wastes from the neighboring Calmette Hospital. As discussed below under item 8, a consultant will be engaged to estimate the infectious waste quantity from IPC and Calmette Hospital, and determine the optimum treatment/disposal technology for the infectious wastes from both institutions. The recommended treatment/disposal system will be procured and installed, and the operating personnel for this system will be trained. 28. International shipment of samples. Samples from IPC in Phnom Penh are packaged, labeled and shipped to the Pasteur Institute in Paris for confirmation testing or to Hong Kong for serological testing. The procedures used by IPC in Phnom Penh comply with the IATA regulations, and the IPC personnel have already been trained on these procedures. No additional strengthening will be required in this area, except that funds will be provided for shipment of samples. 29. Personal hygiene at the referral hospitals. Written infection control guidelines at hospitals throughout Cambodia have been developed by MOH based on WHO Guidelines and will be applied at the Calmette Hospital in Phnom Penh as well as the Siem Reap, Kampong Cham, Kampot, and Stung Treng Referral Hospitals. PPE and supplies will be procured to these hospitals (e.g. masks, disposable gloves). Procurement will be initiated after auditing of the Central Medical Store (CMS) in Phnom Penh and preparation of the PPE kits by CMS and distribution of these kits to each o f the five referral hospitals. Staff at each of the five hospitals will be trained on the use of PPE. 30. Construction of isolation rooms at three referral hospitals. The Calmette and Siem Reap Referral Hospitals have been equipped with isolation rooms (with dedicated sewage control systems) to receive potentially-ah1 infected patients. Five isolation rooms will be constructed at each of the following referral hospitals: Kampong Cham, Kampot, and Stung Treng. In addition, the sewage treatment (disinfection) system for the isolation rooms at each of the three hospitals will be procured and installed. The adverse impacts during construction would include dust and noise emissions, generation of construction waste, and disturbance of traffic. These adverse impacts will be mitigated by including in the construction contract a clause regarding observation of standards for good construction practices. Construction will be supervised to observe compliance with these good construction practices Healthcare waste management at hospitals to be receiving potentially AHI-infected patients. AH1 virus may spread to humans if proper waste management measures are not taken at hospitals treating potentially AHI-infected patients. The following five hospitals have been designated to receive AHI-infected (or potentially AHI-infected) patients at Phase 3 : Calmette, Siem Reap, Kampong Cham, Kampot, and Stung Treng. This subcomponent aims at instituting proper waste management procedures at each of these hospitals. In addition, the waste treatmentldisposal system for the Calmette Hospital will include the infectious wastes generated by the Pasteur Institute in Phnom Penh (IPC). The main activities will include: 12 Animal specimens are received from NVRI for confirmation testing. 74

85 Consulting services for determining waste quantities by type (especially infectious wastes and sharps) from each of the five hospitals and IPC, selecting the optimum technology for infectious waste treatment/disposal through evaluation of alternative technologies (autoclave, microwave, incineration) and providing the specifications of the selected technology (in the case of Calmette Hospital, jointly with IPC), and preparing detailed healthcare waste management plan for each of the five hospitals. In addition, for each of the three hospitals (Kampong Cham, Kampot, and Stung Treng), consulting services will include the design of the sewage treatment (disinfection) system associated with the isolation rooms. Healthcare waste management investment. This will include procurement, installation, and testing (with sampling and analysis of pollutants) of the solid waste treatment technology at each of the five referral hospitals. The waste system at Calmette Hospital will also treat wastes from IPC. In addition, the sewage treatment (disinfection) system at Kampong Cham, Kampot and Stung Treng hospitals will be procured, installed, and tested. Training of the operating staff at each hospital will be provided by the equipment supplier. Equipment and supplies (trolleys, containers, bins, plastic bags, labels) for each of the five hospitals will also be procured. Consulting services for healthcare waste management training to the local trainers as well as the staff of the five referral hospitals. The local trainers will be training the healthcare staff after the first year. (d) Procurement of consumables. This will cover the operating costs for the waste management system at each of the five hospitals (e.g. steadelectricity for the treatment technology) and supplies (e.g. bags, plastic labels). (e) Hospital grounds cleanup. Some of the five referral hospital grounds are in poor hygienic conditions, with garbage thrown away haphazardly and poultry breeding in potentially infectious waste areas on hospital grounds. Such unhygienic areas on hospital grounds at these five hospitals will be corrected. 32. Personal protection during a potential AH1 pandemic. The stockpiling of PPE is envisaged for the frontline workers as well the central, provincial, and district level MOH personnel who are involved in the management of an AH1 pandemic. PPE will be stored at the Central Medical Store (CMS). 6. Consultation and Disclosure of the Project's Environmental Management Plan 33. This preliminary draft Environmental Management Plan (EMP) has been discussed with the representatives of MOH and MAFF. The IAs will engage specialized consultants to help in the finalization of this EMP during early stages of implementation. It will also be discussed with other participating government agencies (e.g., NCDM, Ministry of Information, MOE, and the Inter- Ministerial Committee on Avian Influenza) and non-governmental organizations (NGOs). The draft EMP will be finalized upon incorporation of comments by these government agencies and NGOs. The finalized EMF' will be disclosed at publicly accessible locations in Cambodia and at InfoShop in Washington D.C., as well as formally adopted by the I As for use under the project. 75

86 7. Reporting on the Implementation Progress of the Project s Mitigation and Monitoring Measures 34. Procedures for providing information on the progress of project implementation and results of mitigation and monitoring measures have been structured to facilitate project supervision and review. Accordingly, each national implementation agency will prepare and submit biannual progress reports to NCDM which will submit a summary biannual report to the World Bank. The biannual reports will indicate the activities conducted, the remaining activities to be conducted, the products generated, the major issues encountered and how these issues have been resolved as well as the outstanding issues, the expenditures in comparison with the budget. NCDM will also submit a copy of the EMP-related specific activity reports (e.g. the waste management plan) to the World Bank for review, comments, and no objection (if satisfactory). 76

87 Appendix 7: Social Analysis CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project Safeguards Policies. 1. Based on the social analysis carried out, the project s activities only trigger one social safeguard policy, this is OP4.10, Indigenous Peoples. This Bank policy applies because the ethnic minorities, who form the poorest sector of the population in Cambodia, would be most vulnerable to loss of poultry and the income derived from it. Accordingly, an Ethnic Minorities Planning Framework (EMPF) will be developed by specialized consultants outlining the principles to be used for project activities that might take place in ethnic communities. A communication strategy will be incorporated into project design to address concerns about any large-scale project activities and to disseminate information in local languages and in culturally appropriate and accessible ways. 2. Involuntary Resettlement Policy (OP4.12) is not triggered as any involuntary land acquisition or displacement of people is expected under the project. Government is considering whether it will purchase from farmers those poultry taken as a result of disease investigation and surveillance activities. Project Beneficiaries 3. Project activities will cover all of Cambodia, and will benefit commercial and backyard poultry farmers, traders, and processors in improving their poultry management practices to reduce the risk of an outbreak of avian influenza. Backyard poultry farmers are, in many cases, poor farmers living at subsistence levels, and include ethnic minorities. Women play a key role in the backyard poultry sector as they often are responsible for poultry production and obtain food products and income from their poultry flocks. A national campaign will provide information and educate farmers as well as the general public about the risks of avian influenza. This information and education campaign will be designed to take into account the diverse stakeholders and characteristics of the sectors covered (that is, commercial and backyard producers, traders and processors). Multiple media tools will be used and relevant campaign material will be translated into key ethnic minorities languages. 4. The project s animal health component will establish an emergency contingency fund to facilitate rapid responses to outbreaks that will allow rapid mobilization of the necessary funds for payment of workers involved in containing the disease. Villagers are more likely to report disease if they know that they or their neighbors will not be disadvantaged by doing so. Therefore part of the contingency fund will cover the cost of buying poultry taken as a result of disease investigatiodsurveillance activities. A small fund will also be established for purchase of animal vaccine for use in emergencies. 5. Key beneficiaries of the project will be government agencies and staff, particularly in the agricultural and health sectors. These will benefit from training exercises, institutional strengthening and enhanced management practices. The general population of Cambodia will benefit from enhanced institutional set-up, management practices and awareness concerning poultry production and the health sector. The risk for an outbreak of avian influenza and subsequent pandemic will be minimized and the ability of key stakeholders (e.g. health practitioners and poultry farmers) to address a possible outbreak and pandemic will be enhanced. Consultation 6. Preliminary consultations have been held with a large number of government representatives in the respective sectors receiving support under the project. These consultations have taken place at 77

88 national as well as provincial levels. MAFF has held consultations with commercial and backyard poultry farmers concerning measures to avoid and address outbreaks of avian influenza. Feedback from these consultations has been incorporated into the government s strategy supported by the project. Further consultations and information and education campaigns will be undertaken with various stakeholders during implementation, including commercial and backyard poultry farmers. EMPF Consultation and Disclosure 7. An Ethnic Minorities Planning Framework (EMPF) will be prepared by specialized consultants hired by the IAs during implementation phase. The draft EMPF will be revised after appropriate consultation with various stakeholders (government agencies, the commercial poultry associations, mass organizations, ethnic minorities groups, and NGOs) and completed to be properly disclosed within Cambodia and in Washington D.C. (at the Infoshop), once it has been found acceptable to IDA. The Financing and Grant Agreements include specific dated covenants reflecting these arrangements for the final compliance with Bank s policies. Beneficiary and NGO Consultation and Involvement in Project Implementation 8. Many development NGOs in Cambodia work with poor farmers, including activities supporting small livestock such as poultry. Several such NGOs, including CARE Australia, have been consulted during project preparation. These NGOs will be an important target group for increasing their awareness of national policy and measures to address the risk of avian influenza, and will continue to be consulted during implementation. Civil society organizations will participate in project implementation, mainly concerning the public information campaign. District and village facilitators will be trained and participate in implementing the public information campaign. Resettlement, Land Acquisition and Livelihoods. 9. No land acquisition or resettlement will take place under the project. The project s animal health component will establish an emergency contingency fund to facilitate rapid responses to outbreaks that will allow rapid mobilization of the necessary funds for payment of workers involved in containing the disease. Villagers are more likely to report disease if they know that they or their neighbors will not be disadvantaged by doing so. Therefore part of the contingency fund will cover the cost of buying poultry taken as a result of disease investigatiodsurveillance activities. A small fund will also be established for purchase of animal vaccine for use in emergencies. Impact on the Livelihoods of Ethnic Minorities 10. The project does not adversely affect ethnic minorities. Instead, project activities will take place in all areas of the country and ethnic groups will benefit from an enhanced understanding of the AHI, of ways to improve biosecurity, of measures to be taken in case of outbreaks, and of the compensation for loss of poultry due to an outbreak. The public information campaign will be designed to ensure it is also appropriate for the ethnic minorities in Cambodia, and the campaign will be translated into ethnic languages. 78

89 Appendix 8: Economic Analysis CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project 1. Global Public Good and Pro-poor. The proposed intervention s human health objective comes closest to the definition of a pure public good at the global level in that protecting Cambodian farmers from a pandemic human influenza also improves the probability of prevention of the disease worldwide, and one cannot exclude anyone from deriving the benefit. The project thus creates a good that is both non-rival, and non-excludable. The intervention achieves this objective by addressing, among other things, the lack of incentives at the individual level and at the country level: Farmers have the incentive to hide any outbreak and even transport diseased chicken to markets for sale. At the country level, for Cambodia as a whole, similar incentives exist to hide outbreaks from fear of trade and travel restrictions. The project addresses both these incentives by setting up proper surveillance and other mechanisms, apart from providing the knowledge about how to go about prevention. 2. The project s animal health component, apart from creating public goods, also addresses poverty. While every citizen will benefit from the project s protection against AH1 developing into a pandemic human influenza, the benefits during the current phase will accrue mainly to the rural poor who are involved in backyard chicken farming. Even within this group, it is the very poor who succumb to the temptation of eating chickens which die from disease or which are sick (possibly due to AHI). Other diseases bring similar conditions to the chicken and it is not uncommon among the very poor to consume disease-affected chickens. This will be addressed under the project and, consequently, the project will help the very poor. 3. Large Potential Benefits and Considerable Uncertainty. Although AH1 is still mainly an animal health problem, it is widely considered that a global pandemic of human influenza may be both overdue and likely. Various analyses have therefore been undertaken to examine economic consequences of human-to-human transmission at the national and global level. In the case of efficient human-tohuman transmission (that is, WHO Phase IV and beyond), the losses and costs from fatalities and hospitalization expenses for Cambodia, a country of 14 million people, are conservatively estimated to be around US$195 million. According to WHO, the likely impact of an AH1 pandemic on unprotected humans during Phase IV human-to-human transmission are as follows: (a) 30 percent of unprotected humans are likely to be infected (4.2 million Cambodians), (b) one tenth of them will require hospitalization (420,000 Cambodians), and(c) one and a half percent of all human infection cases will be fatal (63,000 Cambodians). With a per capita income US$350, the present value of the loss of income due to fatalities is conservatively estimated at US$3,000 per person; and the cost of hospitalization, which includes lost income for 10 days, is estimated at US$15 per person. The above figures lead to an estimate of the total cost of US$195.3 million for Cambodia from fatalities (US$189 million), and hospitalization (US$6.3 million). 4. As an animal health problem, the economic consequences relate mainly to a loss of income to farmers from poultry death and culling, and the decline in prices when consumers avoid eating chicken. The income loss is estimated at US$7.6 million assuming poultry death from disease or culling could be similar to that of avian influenza outbreaks in Vietnam in 2003 (17.5 percent of the stock), cost of each bird at US$l.50, and putting current stock for poultry in Cambodia at 29 million (extrapolating FA0 estimated3 of poultry in Cambodia for 2002 of 23 million at the 6.1 percent average annual growth rate which occurred during ). If the situation becomes worse, and all activities in the rural area are l3 FA0 Livestock Sector Brief, Cambodia July

90 affected, every one percent fall in the agricultural output would result in losses of US$16 milli~n ~ per year. 5. Benefit Cost Analysis. The project and Cambodia s National Comprehensive Plan are expected to be a partial insurance against the large potential losses indicated above. Of course, estimated benefits would be even larger if the insurance is assumed to prevent disruption at the regional level (including neighboring economies o f Vietnam, Thailand, and Laos), or at the global level. In addition, the SARS epidemic in Asia during 2003 led to substantial additional costs to economies from excess avoidance behavior of individuals (such as curtailing movement in public, postponing purchases, etc.), which could be as high as 1-2 percent o f quarterly output. While in a true pandemic such costs could increase to very great levels, this analysis does not include either the (a) benefits to countries other than Cambodia, or (b) benefits from averting damage to other economic activities within Cambodia such as tourism and trade. In an initiative such as Cambodia s National Comprehensive Plan, the eventual results will accrue for the prevention of the focal disease if the entire program holds together because of the integrated risk (both animal and human). Therefore, it may be appropriate to view only the benefit-cost ratios for the Plan as a whole as summarized in Table 1 : Table 1: Benefit Cost Analysis Summary Human population Potential human attack rate Number of infected humans Hospitalization rate(% of infected) Number of hospitalization Costs per hospitalizations Total cost of hospitalization Human fatality rate (% of infected) Number of fatalities Cost of each human fatality Total cost of human fatalities Benefits in the human health sector 14,000, % 4,200, O% 420,000 $15 $6,300, % 63,000 $3,000 $189,000,000 $195,300,000 Poultry population 29,000,000 Potential poultry death rate 17.5% (from disease and culling) Number of poultry death 5,075,000 Cost of each poultry loss Total cost of poultry death Benefits in the animal health sector $1.50 $7,6 12,500 $7,612,500 Total Plan benefits Total Plan costs $202,912,500 $32,545,000 Overall Benefit-Cost Ratio Sensitivity Analysis. The extent of protection achieved through implementation of the National Comprehensive Plan will depend on the efficacy of the prevention, containment and treatment measures. l4 Cambodia GDP (2004) was US$4.9 billion and Agriculture value added was about US$1.6 billion (32.9 percent of GDP). 80

91 Assumed levels of efficacy of these measures determine the range of protection scenarios, with the protection rates varying between 100 percent (Base Case), 80 percent (Scenario 2) and 30 percent (Scenario 3). As summarized in Table 2, this analysis shows that the benefit-cost ratio remains favorable even under the most conservative assumptions: Table 2: Sensitivity Analysis Human population Potential human attack rate Number of infected humans Hospitalization rate(% of infected) Number of hospitalization Costs per hospitalizations Total cost of hospitalization Human fatality rate (% of infected) Protection Rate Number of fatalities Cost of each human fatality Total cost of human fatalities Benefits in the human health sector Base Case 14,000, % 4,200, % 420,000 $15 $6,300, % 100% 63,000 $3,000 $1 89,000,000 $1 95,300,000 Scenario 2 14,000, % 4,200, % 420,000 $15 $6,300, % 80% 50,400 $3,000 $151,200,000 $157,500,000 Scenario 3 14,000, % 4,200, % 420,000 $15 $6,300, % 30% 18,900 $3,000 $56,700,000 $63,000,000 Poultry population 29,000,000 29,000,000 29,000,000 Potential poultry death rate 17.5% 17.5% 17.5% (from disease and culling) Number of poultry death 5,075,000 5,075,000 5,075,000 Cost of each poultry loss $1.50 $1.50 $1.50 Total cost of poultry death $7,6 12,500 $7,6 12,500 $7,6 12,500 Benefits in the animal health sector $7,612,500 $7,612,500 $7,612,500 Total Plan benefits Total Plan costs $202,9 12,500 $165,112,500 $70,612,500 $32,545,000 $32,545,000 $32,545,000 Overall Benefit-Cost Ratio Efficiencies from Multiple-use of Resources and Piggybacking Private Sector Activities. The most important efficiency enhancing measure in project design is from strengthening the capacity of the National Comprehensive Plan ministries and other units not only for AH1 but also for other similar diseases in the future and for regular sectoral services. In these regard, the project has substantial benefits not estimated for this economic analysis, over and above the benefits calculated from avoidance of a pandemic shown in the preceding sections. For example, in the Animal Health component, NVRI s diagnostic capacity will be strengthened to respond more effectively to the existing demand for AH1 testing and to respond to future increases in demand. This strengthening of NVRI, when not used for AH1 testing, can be used for other animal health testing. With this project, NVRI will be able to implement internationally acceptable and recognized Quality Assurance (QA) and Quality Control (QC) procedures to ensure that the testing of large numbers of samples is undertaken both accurately and rapidly primarily for HPAI but when not used for that purpose for other animal diseases as well. In parallel, the Animal Health Office (AHO) will be strengthened to support and coordinate the management of the village animal health service delivery system, which includes VAHWs, VAHW trainers, the cold chain for vaccine storage in both the public and private sectors, and the use of vaccines. The 81

92 establishment of the effective cold chain system will also support vaccination in cattle, buffalo, pigs and poultry, and promoting production technologies that can improve farmer income. Promoting vaccination in poultry helps to reduce outbreaks of Newcastle Disease and Fowl Cholera (deaths from these diseases significantly confound the HPAI surveillance program). Farmers also learn about HPAI through participation in overall vaccination and extension activities. 10. In the Human Health component, MOH conducts communicable disease surveillance using the Outbreak Reporting System, which consists o f data collection and analysis on 12 syndromes and diseases. Acute respiratory infection (ARI) is one of the diseases under surveillance and would theoretically capture human cases of influenza. In order to monitor influenza-like illness (ILI) epidemiology in Cambodia, MOH has been establishing an ILI system, which is expected to be crucial for detecting increased activity of ILI in the community. Consequently, the project will support monitoring of general influenza not related to AH1 and will strengthen the capacity of referral hospitals to manage suspected cases prior to their referral to Calmette or Siem Riep hospitals. 11. The Inter-ministerial Cooperation for Pandemic Preparedness component will build up Cambodia s capacity for other disasters as well, for example, floods. Towards the establishment of the NCDM General Secretariat and various internal units, the project will undertake a review of NCDM s organization structure, and develop its new staffing requirement. For the staff, it will assess the training needs and create a human resources development strategy and training program. A key area of expertise to be developed is financial accountability of the various institutions and individuals involved in all emergency operations. 12. Another efficiency enhancing measure is to incorporate the help of essentially private sector workers. For example, in the animal health component, the project is expected to develop the VAHW system to rapidly respond to HPAI outbreak investigations but, absent such outbreaks, they will be useful for extension services for livestock. VAHWs, who are private sector workers, make their income from providing vaccination and other services for the farmers. In this project, they will also be the frontline of surveillance of HPAI with minimal long-term expenditure from the project. 82

93 Appendix 9: Discussion Notes CAMBODIA: Avian and Human Influenza Control and Preparedness Emergency Project Discussion Note 1: Vaccination of Poultry in Cambodia for HPAI 1. FAO s guide on the control and prevention of highly pathogenic avian influenza, issued in 2004, stressed that there is a range of measures available for controlling and preventing highly pathogenic avian influenza. The most appropriate combination of these measures should be selected by infected and at risk countries, based on the local disease situation, socio-economic, environmental and technical factors, and implementation capacity. This document also recommended that the approach to control and prevention of this disease can vary over time depending on changes in the disease situation or better knowledge of its epidemiology. 2. Among the measures available for control and prevention of H5N1 HPAI is vaccination, which can be used as an aid in controlling, eradicating and preventing infection and disease. Vaccination can be applied in three ways: (a) emergency vaccination around disease outbreaks, (b) vaccination in infected places to reduce the levels of infection and to aid in virus elimination, and (c) prophylactic vaccination in places at high risk of infection. The validity of these methods in controlling and preventing highly pathogenic avian influenza was reaffirmed at a joint OIE/FAO international meeting on vaccination for avian influenza in Verona in March So far Cambodia has chosen not to include vaccination as an element of its control program. This is based on the relatively low number of recorded outbreaks and observations that current control measures (and perhaps the relatively low poultry density in the country) appear to be keeping the disease in check. However, it is extremely unlikely that H5N1 influenza viruses will be eliminated from Asia in the medium term, which means that virus could return to Cambodia at any time. It is also possible that virus continues to circulate silently in domestic ducks in the country, as it is in neighboring countries. 4. At this stage, there is limited information available on the infection status of domestic ducks and the role ducks are playing in spread of infection in Cambodia. If future disease outbreaks are traced to the domestic duck population, then targeted vaccination in this population should be considered as one of the strategies for reduction in infection. 5. Currently, there is limited information on the risk posed to and by other production systems, such as large periurban poultry farms. Vaccination should be considered for these as one of the possible control options if it assists in preventing disease in these farms, especially if farmers are prepared to pay for the vaccine and appropriate post-vaccination monitoring strategies are put in place. A combination of enhanced biosecurity and vaccination has been used successfully in commercial farms in Hong Kong to minimize the risk of infection. Blanket vaccination of the millions of smallholder poultry does not currently make economic sense due to the relatively low prevalence of disease, but targeted vaccination in areas subject to repeated outbreaks should be considered (along with other alternative measures), especially if changes to the production system cannot be implemented. 6. Concerns have been raised that the use of vaccination will lead to silent excretion of virus by infected poultry. Although short term excretion can occur in some vaccinated poultry subsequently infected with virus, the quantity of virus excreted is far lower than that excreted by unvaccinated, infected poultry. In addition vaccinated poultry are more resistant to infection than their unvaccinated counterparts. In places where the coping strategy for poultry owners in the face of a disease outbreak is to either sell or consume their diseased or at risk flock, spread of virus from uncontrolled sale of 83

94 unvaccinated poultry represents a much greater risk than potential low level excretion by a small percentage o f vaccinated poultry. 7. If vaccination is used, some post-vaccination monitoring appropriate to the local situation is recommended to determine whether vaccines are providing adequate protection and to assess whether H5N1 viruses are still circulating in vaccinated populations. This should include thorough investigations of all cases of disease in poultry that have already been vaccinated to assess for evidence of antigenic change in viruses that may require changes in vaccine composition. 8. If vaccines are used in a control program the following need to be in place: 0 an effective, reliable and sustainable cold-chain for vaccine transport and delivery exists to ensure that vaccine potency is maintained from initial production to the final recipient (chicken); 0 sufficient stocks of vaccine originating from a reputable manufacturer, produced according to international standards o f QA and QC, 0 sufficient appropriately trained vaccinators capable of delivering vaccine to poultry without spreading disease through poor hygiene practices. 0 sufficient field and laboratory capacity to perform appropriate post-vaccination monitoring and surveillance. 9. This project will test and develop capacity to implement emergency vaccination in the face of outbreaks of H5N1 HPAI. It will also conduct a review of current production and marketing practices to determine the most appropriate set of measures to minimize or mitigate the effects of high risk practices. This will consider all available control and preventive measures. Ultimately the decision to use vaccination as part of the control and prevention program for H5N1 HPAI lies with disease authorities in Cambodia who, through this project, will be provided with the best possible advice on the benefits and drawbacks of vaccination, based on studies conducted under local conditions. Discussion Note 2: Surveillance Strategy for HPAI Background 10. The FA0 guiding principles for highly pathogenic avian influenza surveillance and diagnostic networks in Asia) state that the objectives of HPAI surveillance and diagnostic networks include: > > > To help to design effective control programs for poultry production systems; > To assess the temporal and spatial patterns and thereby to improve the effectiveness of control efforts; 9 > 9 > To detect clinical disease and infection; To understand the epidemiology and ecology of HPAI, as well as its socioeconomic impact; To understand the evolution in Asia of HPAI virus variants; To help define and control risks to public health; To monitor for antigenic drift in AI viruses; To maintain the viability of subsistence level poultry production and help assure food security; and, 84

95 k To demonstrate freedom from clinical disease and absence of infection in a country or compartment and thereby facilitate trade. Surveillance in Cambodia 11. The surveillance system for HPAI in Cambodia was established in early 2004 in response to outbreaks of HPAI in the region. The surveillance system is aimed primarily at the smallholder poultry sector since this sector contains 90 percent o f the poultry population, and is still evolving and expanding. It consists of two basic areas: k k a hot-line for reporting of suspected HPAI outbreaks by farmers and the public has been distributed throughout the country, supported by public awareness programs; and, Village Animal Health Workers (VAHWs) in many provinces have been trained on HPAI and are being paid or encouraged by projects to report suspected outbreaks either through the hot-line or to the local veterinary services. 12. The development of a comprehensive surveillance plan is a high priority for Cambodia. This document is not a detailed surveillance plan, but presents some general issues that are relevant to HPAI surveillance within Cambodia. 13. There is currently no legal requirement for owners to report suspicion o f HPAI to MAFF. Poultry Population at Risk Table 1. Poultry Population at Risk of HPAI in Cambodia System Number of farms Chicken Duck Total % Population ('000) Chicken Duck Total % Backyard Commercial broilers Commercial Layers Duck systems Hatcheries, parent stock Total 1,881, ,000 1,900, ,955 2,727 14, ,901, , I Backyard 14. There are approximately 1.9 million backyard poultry flocks in Cambodia in villages. The goal is to have the primary scanning surveillance system delivered by the village animal health workers (VAHWs) in each village. Their primary task will be case detection and reporting to the district veterinary officer for investigation. A case definition (trigger points) of suspect HPAI cases within the 85

96 village system will need to be agreed by MAFF as the basis for reporting by VAHW and investigation by district and provincial staff. 15. In addition to reporting by VAHWs, there is a hotline that receives calls from members o f the general public (including farmers) who wish to report suspect cases of HPAI disease. The detection sensitivity of the hotline has been increased by raising awareness of HPAI in the community via information, education and communication activities. Commercial Broilers and Layers and Chicken Hatcheries and Parent Stock 16. Disease surveillance relies on privately employed veterinarians and other animal health staff who monitor mortality rates within these production systems. Duck Systems 17. About 29 percent of duck production is in commercial farms in Cambodia. Most commercial duck production is concentrated in the provinces of Takeo, Kampong Cham, Sihanoukville, Siem Reap, Prey Veng, and Battambang. Commercial duck raising is much less standardized than the raising of chickens and about 35 percent of farms raise broilers and 70 percent raise layers. Most of these ducks are reared under conditions of minimal farm biosecurity. 18. Scanning surveillance in the commercial duck sector will also rely on VAHWs. However, targeted surveillance within the commercial duck production sector is necessary since, in contrast to chickens, ducks may be infected with HPAI and tend to show little or no clinical signs of H5N1 infection. Targeted Surveillance (active) 19. Targeted surveillance focuses sampling on high-risk populations (that is, targeted populations). In the context of HPAI, these areas of high risk include domestic waterfowl (such as ducks), live bird markets, slaughterhouses and selected farms in Production Sector 3 and 4, especially those near roads or wetlands. Further targeting o f farms is possible taking into account marketing and movement pattemsboth within Cambodia and between Cambodia and neighboring infected countries-of poultry and poultry products. Surveillance as Part of Response Activities Suspect case investigation 20. A detailed protocol, which includes standardized data collection, should be followed for all suspect HPAI case investigations (see FAO/OIE guidelines). Ideally the protocol will include SOPS for all district and provincial animal health staff to follow. This protocol should include details for tracefonvard and traceback procedures, completion of comprehensive data forms and, if appropriate, the use of rapid antigen tests to confirm a diagnosis of HPAI. Only rapid antigen tests that have been evaluated and recommended by international agencies should be used. It needs to be recognized that reported outbreaks may only represent a small proportion of all cases of infection. It is essential to ascertain whether the reported case is the first case of infection in that area or just the first one reported in a place where infection is already endemic. The response by animal health authorities to these two different scenarios may vary. l5 Review of the poultry production and assessment of the socio-economic impact of the highly pathogenic avian influenza epidemic in Cambodia (VSF 2004). 86

97 Confirmed HPAI case 21. Enhanced scanning and targeted surveillance is necessary in areas surrounding any newly detected outbreaks of HPAI. Such surveillance will involve more focused surveillance by VAHWs, district and provincial staff. Targeted surveillance will include active sampling of at risk bird species. The disease investigation protocol for confirmed cases should detail specific surveillance activities. If human cases are detected, surveillance activities will be delivered in conjunction with human health counterparts and will include active sampling of a larger range of at risk species and may including sampling pigs for example. Discussion Note 3: Enhancing Control of HPAI through Compensation 22. The culling of infected birds or those that are in regions immediately around infected animals is the most practiced control method for limiting the spread of Highly Pathogenic Avian Influenza (HPAI) and the international practice is to provide farmers and producers - whose birds are being culled - with compensation for their losses. The payment of compensation encourages producer cooperation in disease reporting and compliance with culling requirements. When carefully developed, a compensation system can help to reduce the time lag between an outbreak and the initiation of containment actions and hence reduce the overall cost of control. To the extent that compensation reduces the virus load in the environment, it also contributes to reducing the risk of the virus mutating to a form that is readily transmissible to and between humans. 23. The principal objective of compensation schemes is to enhance early reporting and enable culling of diseased birds or those that are suspected of being diseased. Additionally, compensation serves to reimburse the losses of private individuals who have complied with a disease control process that has been undertaken for the public good. While compensation is driven by the imperative of disease containment, it is important to recognize that culling activities are likely to have a significant impact on the very poor, but compensation cannot cover all livelihood losses that result from livestock control or replace the essential role that must be played by social safety nets. Preparedness is Key 24. An effective and efficient compensation system will compensate the appropriate beneficiaries for the appropriate losses, at an appropriate level with the shortest possible interval between culling and the payment of the compensation. But achieving these criteria requires a high degree of preparation before an outbreak takes place, mainly to ensure: (i) an appropriate legislation that details the rights and responsibilities of government, the livestock sector, marketing personnel and farmers, in disease control; (ii) widespread awareness of the dangers posed by the disease and clear guidance as to how these risks can be mitigated; (iii) funds for compensation readily available and procedures established for disbursing them rapidly and in a transparent manner. 25. Unless there is clarity on who should be compensated (a requirement that requires significant effort from government especially when a majority of beneficiaries are operating in small scale enterprises or backyard production systems), when they should be compensated and how much they should receive, there is a risk that the compensation system will not be perceived by stakeholders as credible and this may undermine its role in disease control. In the event that a country experiences an outbreak before these measures are in place, the imperative for effective disease control will force many of the oversight tasks to be undertaken at a later date - further complicating the already complex governance issues related to compensation schemes. 87

98 Identification of Beneficiaries 26. In general terms, the beneficiaries of compensation are the owners of the animals. Other input suppliers in the production network (for example feed suppliers, and market operators) do not normally benefit from compensation schemes even though they may incur losses when livestock production and sales are disrupted by disease. 27. The structure of the compensation scheme is largely determined by the prevailing production system. Large and highly bio-secure poultry farms can be expected to have good inventory records and these farmer documents provide a reliable basis for culling. In contract farming situations, ownership of the birds determines the beneficiary. If the contractor is the owner of the birds, he/she should be compensated and take responsibility for reimbursing the integrator. If the integrator is the owner of the birds, then he/she should receive the compensation. In a few cases, arrangements can be made to pay the contractor for lost income on a wage per day basis, with funds subtracted from the integrator s share before payment. Incorporating contract growers in the compensation scheme is problematic but essential to avoid this issue becoming a loophole that limits effective disease control. 28. Identifying beneficiaries where small enterprises and backyard farming predominates is also complex. Unlike large producers, farmer records are rarely available and factors such as differential ownership by gender (where the heads of household - often men - receive compensation even though it may be female household members that have taken actual responsibility for raising the birds) can also come into play. In these circumstances it is essential to conduct surveys as part of the overall preparedness planning (and not after the disease emerges) to identify ownership patterns, to help raise awareness of the existence of the compensation scheme and to ensure that small scale producers play a full role in the stamping out exercise. Types of Compensations 29. In normal circumstances, compensation covers only direct losses, which include the value o f the animals and sometimes the costs related to the disposal o f dead animals, cleaning and disinfection. Farmlevel consequential losses resulting from business interruption, the introduction of movement controls, and price effects are not covered, although in some developed countries they can be covered under private insurance schemes. 30. Animals that die (from disease) before culling can take place are often not compensated except where these dead birds retain a market value (and thus there is a danger that they will be sold) or where disease control teams, once notified of a potential outbreak are unable to respond to within 72 hours of disease reporting by the farm in question. The accurate computation of losses is assisted greatly by having good farm-level records of poultry holdings available (again, best developed before the outbreak - see section on Preparedness above) and underscores the importance of developing a comprehensive database of these records wherever possible. 31. It is important to recognize that the greatest economic losses suffered by countries experiencing HPAI are likely to be indirect: lost feed sales, diminished tourism, absenteeism from work, and so forth. These losses are never covered by public compensation although, in principle, they could be insurable under private sector contracts outside the livestock sector if (as is rarely the case) the risks are well known and can be quantified. 88

99 Setting Compensation Rates 32. Compensation rates can be set on the basis of (a) market value; (b) budget availability; and, (c) production costs. However, setting the cost on the basis of market value is the preferred option as basing the cost on the budget available often leads to underpayment and thus poor compliance. Basing rates on production costs is problematic as these costs are often difficult to establish accurately and are likely to reward inefficiencies. 33. Where compensation rates are based on market rates, the following principles should be borne in mind: Firstly, compensation rates should represent a percentage of the reference market rate. The reference market rate is the farm-gate price appropriately adjusted for seasonality and reflective of the transport costs from the local community relative to the reference market. The market reference rate should be set before disease outbreaks are experienced as part of the overall preparedness plan. For special category birds (rare breeds, indigenous poultry, fighting cocks, grandparent stock, and other bird types) where market prices are not readily available, reasonable levels should be determined in consultation with stakeholders. 34. Secondly, uniformity of rates across the country and for different types of birds improves the implementation efficiency of the program and should be pursued where movement control is effective. However, where this is not the case, data by type of bird, weight and age may be needed to set the compensation rate as close as possible to prevailing market prices. Thirdly, compensation rates should be no less than 50 percent of reference market value at the farm gate and no more than 100 percent, with the preferred range being 75-90percent. Rates should be considerably lower for diseased birds and even less (but something) for dead birds, to provide sufficient incentives for early and complete reporting. Careful attention needs to be paid to bird movements while compensation payments are being made to ensure that an incentive is not being created for an influx o f healthy birds to disease zones or of diseased birds to disease-free zones. 35. Finally, when dealing with small farmers (and backyard producers), compensation should ideally be paid within 24 hours of the culling and in cash. Where handling of cash presents a security threat, and where credible local financial institutions exist, a voucher system could be used. It is important to note that any delay in payment is likely to have a significant effect on the timeliness and completeness o f reporting. Establishing Awareness 36. Experience confirms that communication on disease control and compensation is an absolute necessity, and further, when this is done in a comprehensive manner, it can account for between 10 to 20 percent of the total package cost. Awareness raising messages should explain to affected farmers why mandatory culling is needed to protect the health of the human population in cases where HPAI is suspected. Farmers should also receive information that clearly explains the principles, procedures and grid o f compensation levels, precise information on the amounts for which they are eligible and an explanation of how they will be paid. As with much related to compensation, these messages should be prepared in advance of outbreaks and with the input of technical and communications specialists. Once developed, messages should be consistent over time or risk undermining the credibility of the program. Payment Systems 37. In order to promote early notification of suspected outbreaks, compensation for culled birds must be paid promptly after the birds have been destroyed. Access to adequate funding to cover the cost of compensation is essential. Typical sources of these funds are the National Treasury, farmers 89