Flood response: World Bank’s $230m ‘CLICK’ project rated ‘moderately’ unsatisfactory

ISLAMABAD: The World Bank project “Competitive and Livable City of Karachi (CLICK)” of worth $230 million is rated as moderately unsatisfactory and restructured with the inclusion of a Contingent Emergency Response Component (CERC) to repurpose $27 million of the CLICK loan to meet the immediate needs of the flood emergency response.

Official documents revealed that a CERC is proposed to be added to the project as Component 5, which will be immediately activated to respond to the ongoing flood emergency, when the loan amendment is effective. The component will be allocated $27 million of the CLICK loan.

A new disbursement category (Category 5) will be introduced for CERC emergency expenditures. A CERC manual and an Emergency Action Plan detailing the use of these funds are currently under preparation. Payments under the CERC will be made from the LGD Project Implementation Unit (LGD-PIU) Designated Account.

The Direct Payment method will be utilized, as needed. The LGD-PIU’s Financial Management team will record the CERC related expenditures separately in the books of account under the segregated component and category. The IFRs will also report CERC-related expenditures separately. The CERC will be audited as part of the CLICK audit, as required under Section 29 of the Bank Guidance on CERC.

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The current implementation arrangements of CLICK will remain unchanged. The CERC will be implemented by the LGD-PIU, which will be responsible for procurement and financial management for CERC. The LGD-PIU will receive technical assistance from the Sindh Resilience Project – Provincial Development Agency (PDMA) PIU (SRP-PIU). The SRP PIU will: (i) undertake a market assessment to identify both national and international suppliers; (ii) estimate costs associated with the supply of goods, services and works; (iii) draft key terms of contract and technical specifications; and (iv) identify risks associated with the existing market and describe measures to manage these risks.

The World Bank loan of $230 million for the CLICK Project was approved on June 27, 2019, and became effective on November 26, 2019. The closing date of the loan is June 30, 2024.

The project development objective (PDO) is to improve urban management, service delivery and the business environment in Karachi. The project comprises four components: Component 1 - Performance-based Grants to Local Councils and Capacity Building; Component 2 - Modernizing Urban Property Tax Administration and Systems; Component 3 – Improvement of City Competitiveness and Business Environment; and Component 4 -Technical Assistance for Solid Waste Management.

The project was restructured on May 18, 2022 when the implementation responsibility for Component 2 – Modernizing Urban Property Tax Administration and Systems was transferred from the Excise, Taxation and Narcotics Department (E&TD) to the Local Government Department (LGD).

Copyright Business Recorder, 2022