arrangements necessary to ensure effective coordination among relevant government
arrangements necessary to ensure effective coordination among relevant government, civil society, and development partner stakeholders. The project made use of the Project Steering Committee for decision making and criteria setting to ensure multi-sector information flow is systematic and robust.
II. Macroeconomic risks.
42) Poor economic policies and dependence on a few trades and a reasonably undiversified economy are significant problems. The recent rise of crime remains to endanger economic stability across the country, and so, the Government needs to continue to ensure a strong security presence in the years to come.
III. Sector strategies and policies
43) Despite LCC’s ownership of the project, overlapping responsibilities of many line agencies could be an obstacle to effective planning and service delivery at the city level. A coordination mechanism between the LCC and line agencies formalised, and a Steering Committee and Coordination and Consultative Committees were set up to facilitate inter-agency collaboration To mitigate these risks.
IV. Technical Design Risks
44) This project was designed to implement low-income shelter interventions, which involved multiple sectors in the three states, engaging different levels of government. Such complexity could lead to challenges related to resource allocation, prioritisation, beneficiary targeting, and project implementation. Capacity-building support was provided in the design and implementation of the activities at all levels to ensure these issues considered up front. An additional technical design risk for the project was among the potential rising of social tensions between the LCC team and CCODE team due to perceived inequalities arising from the project activities. To avoid this, activities under this project were designed to address the responsibilities of both groups. Beneficiary targeting mechanisms publicly disclosed, and communication and outreach strategies were implemented to engage communities in the planning and oversight of project activities.
V. Institutional Capacity for Implementation and Sustainability Risks
45) The responsibility for project implementation relied heavily on the LCC, whose capacity is weak. Due to the dichotomised nature of institutional capacity and investment commitments, it was very challenging to commit significant investments when the capacity of local institutions was inadequate. One of the ways that were used to overcome this issue was to prioritise investments that could be implemented within the existing capacity and with adequate oversights of the local authority’s program M&E structures. Because the capacity building is a time-consuming activity, it was essential to initiate it as part of the technical support subcomponent of the program.
VI. Fiduciary Risk.
46) The fiduciary risk associated with this project would be higher than regular operations. The LCC, which is a platform of the BMF on the project, with assistance from the Malawi Government attended to the fiduciary responsibilities of the project at all levels. The staff of this unit were usually the accountants, and internal auditors seconded from the Offices of the Accountants General. In this way, ready capacity is available for new projects at reduced cost and low risk. The LCC accounting team ensured that all accounting information was adequately captured and reported on time to the stakeholders through the required reports.
47) Because building materials such as cement, roofing, and equipment and machinery are affected by the exchange rates, there was a high chance that the cost of construction and rehabilitation of facilities could experience severe cost and time overruns. It means that physical and financial contingencies provided in the investment plans.
VII. Environmental and Social
48) Malawi is registering changes in its climate patterns and the average precipitation per year has decreased significantly by 3.5 mm per month. Flooding is also becoming more frequent throughout the country. Projections indicate an increase in the number of days with heavy rainfall. Extreme climate events could negatively affect resilience-building efforts. Given these challenges, all assets and services financed under the project designed to be improved, build-back-better standards that take into account climate and disaster risks.
49) On the social aspect the implementation of selected schemes which required land acquisition and resettlement. The project did build upon the experience of some of the resettlement policy framework, which has been developed to guide future slum upgrading planning, which includes participation and communication strategy and a gender action plan to facilitate public participation and mainstreaming gender aspects in the project.
VIII. Stakeholders Risks
50) In a multi-sector and multipronged program, there were coordination and consultation challenges. The project invested in a consultative approach and has a communication strategy so that in a situation where there was a definite concern of the project by all stakeholders of conflict of interest and not following their roles. It was also crucial that their grievances adequately addressed promptly. This type of sensitivity risks among stakeholders This was mitigated to a large extent by having LCC as the anchor off-taker, as well as by having contractual arrangements discussed upfront and agreed with other players.
IX. Other (Security Risks)
51) The dynamic nature of the conflict posed significant implementation and supervision risks for the project. All project interventions were to be carried out in moderate- to high-risk security environments, given the high crime rates of the region. It placed both the project implementation staff and the assets created under the project at medium to high risk. For mitigation, it was the use of third-party monitors, local nongovernmental organisations (NGOs), and other civil society groups for supervision and M&E. To further mitigate this risk, the subproject selection criteria under the strategic action planning exercised security factors and avoided high-risk areas based on periodic security assessments. Flexibility and adaptability of the project design have also been built in the project, allowing it to adapt to the situation.
52) Additionally, the BMF and other development partners also work with the Malawi Government to set up a mechanism for receiving regular security assessments and updates. Under such a mechanism, any future security risks could be brought up by the government and the development partners and mitigation measures accordingly agreed and put in place by the authorities.
53) Given the long-term partnership of the BMF with Malawi Government, the latter is an active entity that is capable of ensuring that the investments are made well in time and are not left stranded. Since BMF owns, operates and maintains the project with support from other stakeholders, it took all due measures required to ensure area stability. Based on this, the risk assessed at “Moderate” during project implementation.