Evaluation of Economic and Social Development Program in Mozambique in FY2017

Chief Evaluator	SATO Kan Hiroshi Chief Senior Researcher, Research Operations Department, IDE-JETRO
Consultant	Japan Techno Co., Ltd.
Period of the Evaluation Study	September 2020 to March 2021
Field Survey Country	Mozambique (remote survey conducted online)

Background, Objectives, and Scope of the Evaluation

MOFA implemented a grant aid project (Grant Aid for Economic and Social Development Program) in 2017 aimed at alleviating power shortages in the country and ensuring a stable supply of electricity by providing fuel for power generation in order to contribute to economic and social development in Mozambique. This evaluation assesses the results of the grant aid project “Economic and Social Development Program in Mozambique in FY2017 (Fuel for Power Generation)” (grant amount: 1.5 billion JPY) implemented by MOFA, with the main objectives of obtaining recommendations and learning lessons for future ODA planning and implementation as well as ensuring public accountability.

Summary of Evaluation Results

● Development Viewpoints

(1) Relevance of Project

The project supported the improvement of the power supply and resulting economic and social development in the northern part of Mozambique, which is located in the Nacala Corridor, through the procurement of fuel oil for power generation. Although the project was not aimed at increasing or expanding the power generation capacity, it was connected to the stabilization of the power supply in the Nacala Corridor. In that sense, it shows consistency with Japan’s high-level policies such as support for infrastructure development and the development of the Nacala Corridor; with development needs in Mozambique, where improved access to electricity is a high priority due to its necessity for the promotion of industrialization; with the need for stabilization of the power supply in the target region; and with targets relating to energy access in the SDGs. On the other hand, appraisal of the project request should have considered the appropriateness of using heavy fuel oil for power generation from the perspective of ensuring environmental sustainability along with the financial sustainability of the state-owned energy company of Mozambique (Electricidade de Moçambique or “EDM”), as well as reducing disparities in access to electricity within the target region.
(Evaluation Result: Satisfactory = B)

(2) Effectiveness of Results

From a long-term perspective, large-scale power plant construction is needed to improve the power supply in northern Mozambique. However, while waiting for this to materialize, the existing grid will continue to be pressed due to increased power demand. The cooperation approach, which assisted the procurement of fuel oil for power generation to maintain the supply of power from a power ship as an emergency measure to stabilize and ensure the quality of the power supply and to prevent large-scale power outages, was therefore adequate. The fuel procured through the project was used to supply power from the power ship for about one year, and EDM was able to secure 100% of the electricity it needed as agreed in the contract with the independent power producer that operated the power ship. In terms of outcomes and impacts, the project helped to sustain production activities in the target region by ensuring the quality of electricity and stabilizing the power supply.
(Evaluation Result: Satisfactory = B)

(3) Appropriateness of Processes

The project was implemented appropriately according to the procedures for the aid modality of the Economic and Social Development Program (procuring agent system), including assessment of development issues, appraisal of the content of requests, and determination of the details of cooperation. On the other hand, the evaluation team found that the usage conditions and power supply performance of the procured fuel were not adequately monitored or recorded after delivery. Furthermore, information disclosed about the project was not sufficiently concrete in terms of clearly publicizing the details of the project and expected development outcomes.
(Evaluation Result: Partially Unsatisfactory = C)

(Note) Ratings: Highly Satisfactory = A; Satisfactory = B; Partially Unsatisfactory = C; Unsatisfactory = D

● Diplomatic Viewpoints

(1) Diplomatic Importance

Mozambique contains gateways to the sea for landlocked countries such as Zambia and Malawi, and peace and stability in the Nacala Corridor, which links the Indian Ocean with the interior of Africa, are important to development in Mozambique along with the entire African continent, as well as to the realization of the “Free and Open Indo-Pacific” promoted by Japan. Mozambique is also a pro-Japanese country that cooperates with Japan in the international community. The two countries celebrated the 40th anniversary of the establishment of diplomatic relations in 2017. Furthermore, Mozambique is rich in mineral and energy resources, and about 30 Japanese companies have established operations there. The program was expected to contribute to the promotion of social and economic activities in the Nacala Corridor centered on northern Mozambique, and its implementation can therefore be considered highly significant.

(2) Diplomatic Impact

The project was urgently requested in order to sustain the generation of electricity necessary to stabilize the supply of power to the central and northern grids amid the deterioration of the financial situation in Mozambique due to the problem of undisclosed debts. In responding promptly to that request and maintaining the supply of electricity, the project is thought to have contributed to the strengthening of trust in bilateral relations.

Recommendations Based on Evaluation Results

(1) Assignment and Management of Project Outcomes Based on Analysis of Development Needs

When managing the progress of the project and explaining and disclosing information to the public for similar projects in the future, outcomes and impacts of sustaining the operation of the power-generating facilities should be analyzed in line with the power-supply situation in the recipient country, and indicators for measuring effectiveness should be set so that the project objectives, nature of cooperation, and outcomes are clearly understood by relevant stakeholders and third parties. Press releases should also explicitly describe the expected outcomes of the project.

(2) Improvement of Monitoring after Delivery of the Procured Product

The implementation status of the project was monitored by MOFA and the Embassy of Japan, based on the quarterly reports and completion report submitted by the procuring agent. However, no records were kept about the achievement of the anticipated results of the project, such as the amount of electricity supplied by the power ship or the status of power supply to the target region. Since the product procured through the project (fuel) was expendable, it was difficult to verify the usage conditions and achievement of the anticipated results after delivery without written records. Accordingly, one idea might have been to request that EDM submit monitoring reports on the usage of the fuel after delivery and consequent achievement of results in contrast with the predetermined outcomes and impacts, depending on the usage conditions of the fuel.

(3) Promotion of Domestic Publicity Efforts in Japan and Mozambique

MOFA’s domestic press release on the signing of an Exchange of Notes (E/N) for the project does not explain the specific target region, the background to the implementation of the project, or the concrete significance and importance of implementation. Similarly, the press release by the Ministry of Foreign Affairs and Cooperation of Mozambique only states that an E/N for Japanese grant aid to implement the Economic and Social Development Program was signed. To obtain adequate understanding and support for the significance and development outcomes of Japan’s ODA projects, publicity efforts in both Japan and Mozambique should convey specific details of the project such as the nature of cooperation, target regions, beneficiaries, background, and significance/importance of implementation. In this case, since the procured product was fuel oil for power generation, it would have been difficult to publicize the usage conditions in a visible manner. However, one option might have been to have EDM include the details and outcomes of Japan’s cooperation in its customer communication materials or annual business report.

---

<< Previous Page　　　Next Page >>