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For the implementation of activities under Component 1 of the project Strengthening productive capacities of farmers and small agribusiness through CSA and renewable energy technologies, FUNICA will implement demand-driven subprojects and technical agribusiness services for which it will sign agreements with beneficiary groups or organizations that will implement the subprojects. The capacity of the beneficiary groups and organizations are unknown at the moment; as such the project will carry out a capacity assessment of each beneficiary group or organization at early stages of subproject preparation, and will decide amongst three different mechanisms to channel fiduciary support to these subprojects: (i) fiduciary administration of subprojects by FUNICA (or delegated administration) on behalf of the beneficiaries; (ii) shared administration, in which the procurement process/decisions will be taken by the beneficiary groups, but payments will be done by the Project/FUNICA; (iii) direct transfer of funds to formalized/legalized groups of beneficiaries (cooperatives, associations, community-based organizations, and others) with enough capacity, including Environmental and Social management capacity to implement the subproject by themselves and report expenses to the implementing agency as required in the Project Operations Manual (POM). These arrangements will be detailed in the POM. The project will build on the experience of the WB with similar implementation arrangements in recent operations in Nicaragua and Central America. The project will also provide capacity building to beneficiary groups and organizations in relation to the management of potential environmental and social risks related to eligible subprojects.
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