AFRICAN DEVELOPMENT FUND REPUBLIC OF THE GAMBIA

Transcription

1 AFRICAN DEVELOPMENT FUND REPUBLIC OF THE GAMBIA INSTITUTIONAL SUPPORT PROJECT FOR ECONOMIC AND FINANCIAL GOVERNANCE APPRAISAL REPORT OSGE 1 September 2007

2 TABLE OF CONTENTS List of tables, List of Annexes, Project Information Sheet, Currency and Measures, List of Abbreviations and Acronyms, The Gambia Comparative Socio-economic Indicators, Project Result-Based Logical Framework, Executive Summary (i-xi) 1. HISTORY AND BACKGROUND OF THE PROJECT 1.1 Origin and History of the Project Past Economic Bank Group Operations in Support of Economic Management & Governance 1 2. THE SECTOR Page 2.1 Economic Management Issues and Constraints Governance Issues Government s Response to address Economic Management and 3 Financial Governance Issues 3. THE SUB-SECTOR 3.1 Beneficiary Institutions Department of State for Finance and Economic Affairs (DOSFEA) Strategy for Poverty Alleviation Coordination Office (SPACO) The National Audit Office (NAO) Government s Current Program in Support of Economic Management 7 and Governance 3.6 Donor Intervention 7 4. THE PROJECT 4.1 Project Design and Rationale Complementarity and Synergies Strategic Concept Project Objectives Project Description Project Costs 4.7 Sources of Finance and Expenditure Schedule PROJECT IMPLEMENTATION 5.1 Executing Agency Institutional Arrangements Project Implementation Schedule Procurement Arrangements Disbursement Arrangements Monitoring and Evaluation Financial Auditing and Reporting Aid Coordination and Harmonization SUSTAINABILITY AND PROJECT RISKS 6.1 Recurrent Costs Project Sustainability Main Risks and Mitigating Measures PROJECT BENEFITS 7.1 Economic Benefits Impact on Cross-cutting Issues CONCLUSIONS AND RECOMMENDATIONS 8.1 Conclusions Recommendations 22 This report was prepared following a preparation mission to The Gambia from 24 April to 9 May The mission comprised Mr. A. N. ISSAHAKU, Senior Governance Expert, OSGE 1 (mission leader), Mr. J.E. ZAYID, Senior Economist, ORWB and Mr. V. WAHBA, Consultant. Enquiries may be directed to Mr. G. NEGATU, Director OSGE.

3 Social Indicators i Development Indicators Gambia Gambia * Africa Developing countries Area ( '000 Km²) 11 30,307 80,976 Total Population (millions) ,325.8 Population growth (annual %) Life expectancy at birth, total (years) Mortality rate, infant (per 1,000 live births) Physicians per 100,000 People Births attended by skilled health staff (% of total) Immunization, measles (% of children ages months) Prevalence of HIV, total (% of population ages 15-49) School enrollment, primary (% gross) School enrollment, secondary (% gross) Ratio of girls to boys in primary education (%) Illiteracy rate, adult total (% of people ages 15 and above) Access to Safe Water (% of Population) Access to Sanitation (% of Population) Human Develop. Index Value (0-1) Human Poverty Index (% of Population) Gambia Economy GNI per capita, Atlas method (current US$) GDP (current Million US$) GDP growth (annual %) Per capita GDP growth (annual %) Gross Domestic Investment (% of GDP) Inflation (annual %) Budget surplus/deficit (% of GDP) Private Sector Development & Infrastructure Time required to start a business (days) Investor Protection Index (0-10) 3 3 Fixed line and mobile phone subscribers (per 1000 people) Trade, External Debt & Financial Flows Export Growth, volume (%) Import Growth, volume (%) Trade Balance ( mn US$) Trade balance (% of GDP) Current Account ( mn US$) Current Account (% of GDP) Debt Service (% of Exports) External Debt (% of GDP) Net Total Inflows ( mn US$) Net Total Official Development Assistance (mn US$) Foreign Direct Investment Inflows (mn US$) External reserves (mn US$) External reserves (in month of imports) Source: ADB Statistics Department, based on various national and international sources. * Most recent year

4 ii CURRENCY EQUIVALENTS (31 July 2007) UA 1 = US Dollar UA 1 = European Euro UA 1 = Dalasi WEIGHTS AND MEASURES Metric System FISCAL YEAR 1 January 31 December Table No. LIST OF TABLES Page 4.1 Summary of Project Cost Estimates by Component and Activity Summary of Project Cost by Category of Expenditure Sources of Finance Annual Expenditure by Source of Finance Annual Expenditure by Activity Indicative Project Implementation Schedule Procurement Arrangements 14 ANNEX NUMBER LIST OF ANNEXES 1. Administrative Map of the Gambia 2. List of Bank Group Approved Operations 3. Department of State for Finance and Economic Affairs Organization Chart. 4. Project Cost by Component and Activity 5. List of Goods and Services 6. Expenditure by Input and Source of Finance 7. Table 1 (Governance Indicators) and Table 3.1 (Summary of Donor Interventions) 8A Terms of Reference for the Macroeconomist Adviser 8B. Terms of Reference for the Financial Adviser 8C. Terms of Reference for Debt Manager Adviser 8D. Terms of Reference for Building a Macroeconomic Model 8E Terms of Reference for the Study on Aid Coordination 9. Project Implementation Schedule

5 iii AFRICAN DEVELOPMENT BANK B.P. 233, 1002 Tunis Belvedere, Tunisia Phone (216) Fax: (216) PROJECT INFORMATION SHEET Date: August 2007 The information given hereunder is intended to provide some guidance to prospective suppliers, contractors, consultants and all persons interested in the procurement of goods and services for projects approved by the Boards of Directors of the Bank Group. More detailed information and guidance should be obtained from the Executing Agency of the Borrower. 1. Country : Republic of The Gambia 2. Name of Project : Institutional Support for Economic and Financial Governance 3. Location : Banjul 4. Beneficiary : Republic of the Gambia 5. Executing Agency : The State Department for Finance and Economic Affairs 6. Project Description : The main Project Components are: A. Strengthening Macroeconomic Management; B. Strengthening Financial Management and Accountability 7. Project Cost : UA 1,473,000 Foreign Currency UA 1,123,000 Local Currency UA 350, African Development Fund Grant : UA 1,400, Other Sources Government : UA 73, Estimated Approval Date : November Start-up Date : 1 January Duration of Project Implementation : 3 years.

6 iv 13. Procurement Arrangements : Procurement of Goods 1. Procurement of IT components and services for the installation of local area networks, as well as desk-top computers and software will be on the basis of National Competitive Bidding. Procurement notices will be advertised by the executing agency in three local papers. The extent, mode and text of the advertisement must be approved by the ADF prior to publication. 2. Procurement of training equipment and the 4-wheel drive vehicles will be done through the UNDP Inter-Agency Procurement Service Office (IAPSO). Acquisition of Consultancy Services 1. The services of the three long-term (30 person months each) consultants in macroeconomic management, financial and fiscal management and debt management will be acquired on the basis of a short-list. Procurement notices will be advertised by the executing agency in three regional and international papers. 2. The services of short-term consultancies for undertaking The Study on Aid Coordination will be on the basis of a short list. 3. The acquisition of audit services for the project accounts will be on the basis of a short-list. General Procurement Notice: The Bank and the Government will agree on a General Procurement Notice (GPN) upon grant approval by the Bank s Boards of Directors. The GPN will be issued for publication in the United Nations Development Business (UNDB). Review Procedures: The following documents are subject to review and approval by the Bank before promulgation: (i) Specific Procurement Notices (SPN); (ii) Short lists; (iii) Tender Documents or Requests for Proposals from Consultants; (iv) Tender Evaluation Reports, including recommendations for contract awards.

7 v LIST OF ABBREVIATIONS AND ACRONYMS ADB ADF AIDS APPR APR CBG CBO CPI CPIA CPPR CPMAC CSO CSP D DOSFEA DEMP DfID EC ECOWAS ESW EU GBOS GDA GDP HDI HIPC HIV IDA IFMIS IMF ILO MDGs MTEF NAO NGO NRA NTF ODA OPEC PCU PRGF PRSP SDA SDR SMP SPA SPACO SWAp UNDP USAID WAMZ WB African Development Bank African Development Fund Acquired Immune Deficiency Syndrome Annual Portfolio Performance Review Annual Progress Report Central Bank of Gambia Community Based Organization Consumer Price Index Country Policy and Institutional Assessment Country Portfolio Performance Review Central Projects Management and Aid Coordination Directorate Civil Society Organization Country Strategy Paper Dalasi (Gambian currency, GMD) Department of State for Finance and Economic Affairs Directorate of Economic Management and Planning Department for International Development (UK) European Community Economic Community of West African States Economic and Sector Work European Union Gambia Bureau of Statistics Gambia Divestiture Agency Gross Domestic Product Human Development Index Heavily Indebted Poor Country Human Immunodeficiency Virus International Development Association Integrated Financial Management Information System International Monetary Fund International Labor Organization Millennium Development Goals Medium Term Expenditure Framework National Audit Office Non Governmental Organization National Revenue Authority Nigeria Trust Fund Official Development Assistance Organization of Petroleum Exporting Countries Project Coordination Unit Poverty Reduction and Growth Facility (IMF) Poverty Reduction Strategy Paper Social Dimension of Adjustment Special Drawing Right Staff-Monitored Program Strategy for Poverty Alleviation Strategy for Poverty Alleviation Coordination Office Sector-Wide Approach United Nations Development Program United States Agency for International Development West African Monetary Zone World Bank

8 vi EXECUTIVE SUMMARY 1. Project Background The Government of the Gambia since the mid 1980s initiated a series of structural adjustment programs whose main objective was to accelerate economic growth and reduce poverty. The effectiveness of these programs, however, has been limited partly because of lack of sustainability in policy and reforms. The first Poverty Reduction Strategy Paper (PRSP I), which covered the period was suspended, following the derailment of the PRGF in As a result, the HIPC relief for the country was suspended as of January Upon successful completion of a staff-monitored program in March 2006, a new PRGF was negotiated and approved to cover The Country s current mediumterm development program, as expressed by its PRGF, has the following main objectives: (i) consolidating macroeconomic stability; (ii) strengthening public financial management and accountability; (iii) strengthening the Central Bank s internal controls and operational independence; (iv) promoting growth and poverty reduction; and (v) attaining the HIPC Completion Point. 2. Purpose of the Grant The purpose of the ADF grant is to provide resources not exceeding UA 1.4 million to meet all foreign exchange and part of the local cost requirements for strengthening macroeconomic management and improving financial governance towards contributing to the attainment of the objectives of the medium-term development program and the benchmarks expressed in the PRGF. 3. Sector Goal and Project Objective The sector goal of the project is to contribute to the national effort to eradicate poverty, whereas the project s objective is to contribute to strengthening capacities in key public institutions engaged in economic management and governance. 3. Project Description The components of the project are the following: A. Strengthening Macroeconomic Management. B. Strengthening Financial Management and Accountability. 5. Project Cost The estimated total cost of the project, net of taxes and duties, is UA 1,473,109 of which UA 1,123,028, equivalent to 76.2 percent is in foreign currency, and the balance, UA 350,081 is in local currency. 6. Sources of Finance The project is financed through an ADF grant amounting to UA 1.4 million, and a contribution from the Government, amounting to UA million, which represents 95.0 percent and 5.0 percent respectively.

9 vii 7. Project Implementation The project will be implemented by the Department of State for Finance and Economic Affairs (DOSFEA). Project implementation will be over a three year period. DOSFEA will manage the project through its Central Projects and Aid Coordination Directorate. The Directorate will be provided with the necessary resources and Technical Assistance to manage the project given that it is newly established. 8. Conclusions and Recommendations The proposed project is based on the Gambia CSP Update and in conformity with the draft AfDB-World Bank Joint Assistance Strategy (JAS) targets and programs, and is in direct response to the findings of the AfDB draft Country Governance Profile. It is also consistent with the Country s medium-term development program, as expressed in its PRSP II ( ) and in the PRGF ( ). In fact the project will support the government s efforts in meeting the PRGF benchmarks and eligibility criteria for budget support, which the government has requested. The proposed operation is in direct response to the first pillar of the PRSP II, related to creating an enabling policy environment to promote growth and reduce poverty. It is also linked directly to the first pillar of the draft JAS strengthening economic management and service delivery. The proposed project has important synergic linkages to the intervention of other development partners.

10 viii The Gambia: Institutional Support Project for Economic Management Project Result-based Logical Framework Hierarchy of Objectives Expected Results Beneficiaries Performance Indicators/Source Indicative Target/Time Frame Assumptions/Risks SECTOR GOAL LONGER-TERM OUTCOMES Contribute to national effort to eradicate poverty in the Gambia through sustained economic growth Accelerated economic growth and Improved socio-economic standards. Population of the Gambia (1.6 million in 2006) -Proportion of people living below the poverty line. -Rate of Economic Growth Sources: -- NDP/UNICEF/WHO surveys and reports. -- World Bank Reports. -- Government annual PRSP Progress Reports -Reducing the proportion of people living in poverty from 61% in 2007 to 40% by the year GDP growth rate of 6-7 percent/year Commitment to economic policy and governance reforms. Absence of exogenous shocks PROJECT OBJECTIVES To contribute to strengthening capacities in key public institutions engaged in economic management and financial governance with a view to poverty reduction. MEDIUM-TERM OUTCOMES Improved accountability Reduced public sector corruption iimproved service delivery Improved fiscal positionreduced domestic and external debt The entire nation Timely Audit of Public Accounts Streamlined budget process and MTEF Internal Audit syetem institutionalized PRGF benchmarks monitoring system in place - 38 persons and 4 persons receiving short-term and Longterm training respectively. -18% of the project s training budget is absorbed by the end of 2008 and 35% and 46% percent respectively in the following two years. -Installation of the LAN system in DOSFEA, NAO, and SPACO completed by 2009.Sources ADB Project supervision reports. - Government maintains the momentum in economic and governance reforms. - Government meets its obligations in providing its contribution in local currency..

11 ix Hierarchy of Objectives Expected Results Beneficiaries Performance Indicators/Source Indicative Target/Time Frame Assumptions/Risks PROJECT ACTIVITIES/INPUTS A. Improved Macroeconomic Management (a.1) Construction of a macroeconomic model. Improved macroeconomic analysis and better tools for macroeconomic projections. DOSFEA/CBG/SPACO (i) Availability of a tested and agreed model. (ii) Staff of DOSFEA/GCB being trained in the model Macroeconomic model being applied in DOSFEA, and CBG by the Third Quarter of 2008 Lack of credible data to inform model construction. (a.2) Provision of TA for macroeconomic management and Debt management (a.3)installation of IT Local Area Network (a.4) Study on Aid Coordination Improved macroeconomic and debt management. Improved accessibility to IFMIS and improved capabilities in obtaining and sharing information and improved tools Improved resource mobilization and quality of aid flows for planning and budgeting. DOSFEA/ SPACO DOSFEA (i) availability of macroeconomic model (ii) availability of policy background papers (iii) available procedural manual on debt management (iv) available guidelines on government borrowing Available LAN in DOSFEA Source: Quarterly Progress Reports/Supervision Reports (i) developed and operational model by first quarter 2009 (i) 3 quarterly macroeconomic bulletins produced per year (ii) macroeconomic model used for policy analysis in 2009 (iii) 3 policy background papers produced by 2009 (i) Procurement and installation of IT local area network equipment for 34 positions (ii) Integrated IFMIS and DOSFEA Study Report on Aid Coordination Laws and regulations issued for streamlining the process of aid coordination 3 rd Quarter of 2008 networked DOSFEA and NAO at end of (a.5) Staff training Up-graded skills of staff DOSFEA/NAO (i) 120 p/d Short-term training in macro policy analysis and advanced financial management (ii) 48 Long-term training macroeconomic modeling and Policy Analysis Sources: Bank Group supervision reports and quarterly progress reports. (i) 14 persons trained in economic policy analysis; 12 persons trained in application of macroeconomic model; 1 person trained in economic modelling and Forecasting; 4 persons trained in Debt Analysis; 2 persons trained in project management; 2 persons trained in foreign borrowing policy (ii) 2 persons trained in economic policy analysis -Implementation of the required policy, institutional and governance reforms; --Adverse climatic or regional factors; Limited Office Space to install IT equipment. Institutional resistance to re-aligned roles in Aid Coordination Inadequate timely availability of government counterpart funds.

12 x Hierarchy of Objectives Expected Results Beneficiaries Performance Indicators/Source Indicative Target/Time Frame Assumptions/Risks B. Financial Management and Accountability (b.1) Human Resources Development Upgraded skills of staff. NAO/ DOSFEA/SPACO (i) 24 p/w Short-term training in project management; cross-cutting poverty issues and advanced audit skills. (ii) 48 p/m long-term training in audit (iii) 2 p/w country visits to best practice applications in poverty cross-cutting issues Sources: --Bank Group supervision reports; - Quarterly project progress reports. (i) 2 persons trained in project management; 2 persons trained in advanced audit skills; 2 persons trained in poverty related cross-cutting issues (ii) 2 persons trained in Audit towards a degree (iii) 2 persons undertake regional field visits to witness best practice in poverty reduction programs Inadequate timely availability of government counterpart funds. (b.2) Provision of TA in financial and fiscal management (b.3) Installation of IT Local Area Network Improved financial planning And Improved reporting on PRSP and PRGF. Internal Audit Institutionalized Revenue forecasting model developed Improved accessibility to IFMIS and improved capabilities in obtaining and sharing information and improved tools for planning and budgeting. DOSFEA DOSFEA/NAO (i) Available financial management standards (ii) PFM Reform Strategy (iii) Training Needs Assessment (iv) Revenue forecasting model available (v) Revenue Justification Papers (v) variance reports (vi) manuals in the use of advanced tools for budget and MTEF preparation and revenue forecasting Source: Quarterly Progress Reports/Supervision Reports. Available LAN in NAO Source: Quarterly Progress Reports/Supervision Reports (i) Financial management standards developed by 2008 (ii) PFM Reform Strategy developed and used by 2009 (iii) Revenue forecasting model operational by 2009 (iv) revenue justification paper prepared each year (v) annual variance reports prepared (vi) manual on MTEF widely used by 2009 Procurement and installation of IT local area network equipment for 45 positions. -Implementation of the required policy, institutional and governance reforms; --Adverse climatic or regional factors; Delays in procurement and installation. (b.4) NAO Training Equipment Improved national capabilities in auditing. NAO Source: Quarterly Progress Reports/Supervision Reports Procurement of training furniture and equipment. Lack of room space to serve as training room and to install training equipment.

13 xi Hierarchy of Objectives Expected Results Beneficiaries Performance Indicators/Source Indicative Target/Time Frame Assumptions/Risks C. Project Coordination Unit Support to Project Management Smooth implementation and coordination of project activities Capacity of CPMAC for project management enhanced Beneficiary agencies: DOSFEA,NAO, SPACO -All project activities to start by January 2008 and end by The training program implemented; -The TA team recruited and managed; -Two studies conducted; -All procurement and recruitment conducted according to the Bank s procedures; -Project accounts properly managed; -Quarterly progress reports and financial statements submitted to the Bank on a timely basis. -The training program conducted as planned; -The TA team selected and at the post by mid 2008; -The two studies completed by the end of 2008; -Project progress reports and financial statements submitted quarterly to the Bank Delays by the Government in submitting lists of nominees for the Project Coordinator, and accountant and secretary.

14 1. INTRODUCTION 1.1 Origin and History of the Project This Institutional Support Project for Economic Management and Governance is the second project of its type in The Gambia, following the Institutional Support Project for Capacity Building. Both projects draw on the Economic Management and Capacity Building Program (EMCBP) started by the Government in 1992 with help from the World Bank. The EMCBP was designed to serve as the overall framework of intervention within the area of institutional support and capacity building The proposed project was pre-appraised in November An ADB multi-disciplinary mission appraised the project in April-May In appraising the project the principles of selectivity, complementarity and synergy were observed. The mission held several consultations with the Secretary of State (minister) for Finance and Economic Affairs and with the Permanent Secretaries and heads of directorates in public institutions involved in the process of economic management and governance. Discussions were also held in Banjul with representatives of key development partners, namely the World Bank, UNDP, the EU, and DFID. The mission was assured that the proposed intervention does not pose any duplication and that the Fund s inputs would complement efforts already underway to improve macroeconomic management and governance. 1.2 Past Bank Group Operations in Support of Economic Management and Governance The Institutional Support Project for Capacity Building (ADF Grant UA million) approved by the ADB Board of Directors in October 1998 was completed by December 2003, after sustaining two years delay. The project aimed at capacity building in mainly three areas: project management, aid and debt management, and female teacher training for primary and higher education. Most of the objectives of the project were met with valuable lessons learned that will inform this proposed project. The Second Structural Adjustment Loan (ADF Loan UA million), was also approved in January 1990, and was almost fully disbursed by July The program was in support of macroeconomic and structural adjustment policy reforms. The PCR Report (ADF/BD/IF/96/217, 25 November 1996) concluded that SAL II substantially achieved most of its objectives Lessons Learned: A major lesson learned from the above projects was that the bonding arrangement for staff benefiting from long-term training has been effective in retaining most of them for the two years of bonding. However, the case of sustainability of project benefits looms in the absence of a civil service reform. Another lesson learned is the need to undertake effective supervision of the project as scheduled. Failure to effectively supervise the earlier projects compromised the full achievement of its objectives. Finally, it is important that the external auditor for the project be procured early on to ensure that project auditing is completed on schedule. The main lesson learned with regards the SAL is the need to assess the managerial and technical capacity of the administration in the implementation of structural adjustment reforms.

15 2 2. THE SECTOR 2.1 Economic Management: Issues and Constraints The Gambia has elaborated its medium to long term development agenda through the PRSP-II, which is anchored to the MDGs. As part of the PRSP-II the country has conducted a MDGs needs assessment for the period to assess requirements for keeping the country on track in terms of meeting MDG targets by the year The report notes that most MDGs could be missed, unless major interventions are done particularly in the area of economic management and governance. Therefore, good economic management and governance is central to the successful implementation of PRSP-II Good economic management has resulted in improved macroeconomic performance over with registered GDP real growth of about 6 percent against -3.2 % in Despite these positive developments over , the Gambian economy continues to be beset with a combination of structural problems, most of which are attributable to shortcomings in policy reforms and institutional and governance problems. 2.2 Governance: Issues and Constraints: The Government of the Gambia has adopted the UNDP governance program as its own governance agenda around which it initiates activities to improve governance in the country. The Government recognizes that it has to improve the governance environment as a basis for sound and effective development that would support the objectives of the PRSP-II and MDGs. In The Gambia, governance indicators paint a mixed picture (See Annex 7). While there has been progress in voice and accountability, political stability, and regulatory quality because of external influence and government s own commitment, The Gambia has declined in government effectiveness, rule of law and control of corruption. The decline in these variables is attributed to weaknesses in accountability in public financial governance mechanisms leading to increased corruption and poor service delivery. Although the 1997 Constitution provides for separation of powers, there is only a weak system of checks and balances on the executive. The parliament is weak in material and human resources and dominated by members of the ruling party A recently concluded ADB Country Governance Profile (CGP) highlights major governance challenges confronting The Gambia. The report notes that the capacity of the Gambian public sector to deliver quality public services continues to be inadequate. Executive interference, characterized by frequent hiring and dismissals of top civil servants also undermines tenure security and general morale and performance in the Gambian civil service. As regards financial accountability, the National Audit Office and the Treasury Directorate, responsible for closing and auditing public accounts, continue to face human resource constraints, notably senior level staff. The budget process as a whole needs to be improved before it can be integrated into a MTEF. Annual off-budget expenditures continue to undermine budget transparency and PRSP implementation. Internal audit as a recognised discipline in the public sector is hard to come by, and the Internal Audit Unit of DOSFEA is far from functioning as a compliant internal audit service.

16 3 2.3 Government s Response to address Economic Management and Financial Governance Issues In addressing the aforementioned economic management and governance issues and constraints, the Government since the 1980s initiated a series of medium-term development programs, which focused on policy, institutional and governance reforms. The first Poverty Reduction Strategy Paper (PRSP I), which covered the period was weakly implemented because of the derailment of the PRGF in Following the launching of the PRSP II, the government and the IMF concluded a three-year PRGF in an amount equivalent to SDR 14 million (US $ 21 million) in addition to an interim assistance under the HIPC Initiative of SDR 0.36 million (US $ 0.5 million). Both the PRGF and the PRSP II emphasize improved economic management and improved fiscal/financial management and accountability as the main objective. One structural performance criterion under the PRGF is the implementation of a Central Project Management and Aid Coordination Directorate in DOSFEA which will be supported by this project Government is responding to the challenge of governance through the UNDP National Governance Program, which is being overseen by a steering Committee in the Office of the President and coordinated by the Department of State for Local Governance. In this regard, issues of corruption, transparency and public financial management, procurement and legal and judicial matters have been tackled. The challenges of institutional capacity constraints in particular continue to haunt The Gambia. This is compounded by the high attrition rates in the civil service. The government has agreed to undertake a major civil service reform with the main objective of recruiting and retaining high caliber staff. As prelude to this initiative, the ADB and the World Bank are working on a study on civil service reforms, the outcome of which would form the basis of reform of the public sector. 3. THE SUB-SECTOR 3.1 The sub-sector benefiting from the proposed project covers the main institutions involved in planning and implementing the Government s medium-term economic programs, mainly the PRSP II, the PRGF and the MTEF. The project would help the government achieve the benchmarks under the PRGF and facilitate implementation of the MTEF, both of which are conditions for budget support in The Gambia. The project also provides institutional and technical support to the annual process of budget preparation and auditing of public accounts, as well as to financial transparency and accountability. The public institutions directly benefiting from the proposed ADF project are grouped into two corresponding to the main components of the project, namely i) macroeconomic management and ii) financial governance and accountability. A. Macroeconomic Management - The Department of State for Finance and Economic Affairs (DOSFEA) covering the Directorates of Economic Management and Planning, Debt Management, Central Project Management and Aid Coordination and The Strategy for Poverty Alleviation Coordination Office (SPACO) B. Financial Governance and Accountability - The National Audit Office (NAO)

17 4 3.2 The Department of State for Finance and Economic Affairs (DOSFEA) DOSFEA plays a central role in the country s economic management system. The department is responsible for the key economic management functions of formulation and monitoring of economic policy, co-ordinating the development planning process, preparation and execution of the national budget, mobilization of development assistance, management of external and domestic debt, co-ordination of multilateral and bilateral development assistance, and coordination of the formulation and monitoring of economic policy. The organizational chart of DOSFEA is in Annex Institutional and Capacity Constraints: DOSFEA is beset by several institutional and capacity constraints, which impact negatively on its ability to manage the economy effectively. One of the most severe constraints is staff shortage. Out of an establishment of 231 posts in the 2007 Budget, the Department currently has about 80 staff (34%), of which only two are professional women with university degrees. The cluster of directorates and units under Finance has 66 staff, whereas the cluster under Economic Affairs has only 14 staff, of which 4 have postgraduate degrees. Recently the staff turnover has been relatively high, as qualified and experienced staff have been leaving the Department for better paying jobs, either in the private sector or in regional and international organizations. It was earlier noted that staff turnover in the civil service is very high because of poor conditions of service and job insecurity attributed to executive interference. In terms of ICT facilities, DOSFEA has in total about 24 desk-top computers of various capacities and in various working conditions. The various directorates and units within DOSFEA are not connected with a local network system. Though an Integrated Financial Management Information System (IFMIS) became operational in January 2007, only senior staff is interconnected. The Department is also severely constrained by mobility, as there are only 4 vehicles, which serve all the directorates and units of the Department as well as visiting missions. These issues and constraints, which impact negatively on the Department as a whole also adversely impact on the directorates and units which are singled out to benefit from this ISP. The Directorate for Economic Management and Planning The Directorate of Economic Management and Planning is mainly in charge of economic and fiscal policy formulation and the preparation of the macroeconomic framework. The Directorate plays an important role in the budget preparation and the preparation of the macroeconomic framework, as well as the budget speech and policy statements for the Poverty Reduction Strategy Paper (PRSP). The Directorate over the last two years has been involved in the preparatory work of the Medium-term Expenditure Framework (MTEF), which is now expected to be launched by It is also charged with monitoring and reporting of fiscal policy reforms. The proposed project will support the directorate in effectively discharging the above responsibilities and particularly delivering on the MTEF by 2008 as a condition for budget support Institutional and Capacity Constraints: The major constraint is the shortage in adequately qualified and trained staff. Of the ten budgeted staff positions, only 5 are currently filled. The Directorate is headed by a Deputy Permanent Secretary and has 4 professionals: 3 senior

18 5 economists and 1 economist. Of these only two have Master Degrees. Two posts for programmers/computer analysts continue to be unfilled. As with the other directorates and units, this directorate is not connected with an electronic local area network and is severely constrained by office space and lack of logistics. Central Project Management and Aid Coordination (CPMAC) The idea of establishing a CPMAC directorate within DOSFEA was operationalized in 2006 with the objective of overseeing the management of donor funded projects. Its main function is to monitor the implementation of projects and serve as an advisory body to the Permanent Secretary on project implementation issues. A director and two staff have already been appointed to the new directorate. Aid coordination is an essential component of economic management linked to the PRSP-II, PRGF and MTEF objectives. The proposed project will help enhance and streamline the aid coordination function of DOSFEA. The unit s capacity for project management will also be sustainably enhanced through its management of the proposed project. An operational CPMAC directorate is one of the structural performance criteria of the PRGF. Institutional and Capacity Constraints Of the seven posts earmarked for the CPMAC only two are filled. In addition to a single economist, the CPMAC Executive Director assumed her post in May The main institutional weakness in addition to lack of staff is the ambiguity surrounding the responsibility of aid coordination. However, there is still the task of reconciling DOSFEA s role in aid coordination with other institutions, mainly the Policy Analysis Unit under the newly established National Planning Commission. Directorate of Debt Management The Directorate of Debt Management is in charge of all administrative and analytic aspects of external public debt. In particular, the Directorate is charged with keeping records on contracted public foreign debts, examining and effecting disbursement requests. It is also in charge of undertaking analytical work on the structure and terms of the foreign debts The Directorate of Debt Management has benefited from the ADF s first Institutional Support Project, approved in October 1998; the project installed and trained officials of the Directorate in Aid and Debt Management, and in the use of the Common-Wealth Secretariat Debt Recording and Management System (CS-DRMS). The Gambia is expected to reach the HIPC completion point in October of Thereafter, government effectiveness in managing its debt portfolio will be more scrutinized by donors in the context of MTEF implementation and PRGF benchmarks. This project will support government capacity to effectively manage its debt portfolio and maintain the target benchmarks Institutional and Capacity Constraints: Availability of adequately qualified and trained staff is a major constraint. The 2007 Budget assigned a staff contingent of 16 of whom one is a director and 8 are professionals. However, at the time of appraisal, the number of professional

19 6 staff was only 5, of whom one has a post-graduate degree. As a result of lack of adequate training, the work of the directorate is currently limited to data entry and disbursement. Analytical work on the cost of borrowing and on borrowing policy does not exist. The Directorate has 3 desk-top computers. As with all other Directorates and Units of DOSFEA there is no local network system. Office space and working environment are not conducive to productivity and staff moral is low. 3.3 The Strategy for Poverty Alleviation Coordination Office (SPACO) SPACO is the government s agency in charge of coordinating and monitoring its Poverty Reduction Strategy Paper (PRSP). Both the PRGF and MTEF are aligned to the PRSP-II so that the success of implementation of PRGF and MTEF is dependent on the effective monitoring of the implementation of the PRSP-II. It is important that the capacity of SPACO is adequately built to effectively undertake its role of monitoring and evaluating the implementation of PRSP- II. The proposed project will help address the constraints noted below to enable SPACO perform its responsibilities in meeting the objectives of the PRGF and MTEF both of which are critical for budget support eligibility Institutional and Capacity Constraints: SPACO is severely understaffed. It has one director and three economists, in contrast to 7 budgeted posts. The Office has suffered severe attrition in staff in recent years, mainly due to low pay and un-conducive work environment. The Office is not connected by a local area network and has poor logistical facilities. 3.4 The Gambia National Audit Office (NAO) The NAO is a semi-autonomous office obliged to audit all public sector institutions and parastatals receiving public funds and submit its audit report to the National Assembly six months after the close of the year s budget bill. The proposed project will help enhance the independence and operational effectiveness of the NAO and bolster reform agenda under the PRGF that fall directly under public financial management. The project will also help integrate the NAO into the IFMIS Institutional and Capacity Constraints: The NAO is constrained by the dearth of adequately qualified and trained staff and by absence of a national IFMIS and local area network. Institutional weaknesses in the Treasury Department (DOSFEA), particularly in the Internal Audit Unit, have resulted in delays in submission of closed public accounts to the NAO. All these shortcomings have led to serious backlog in audited public accounts. To improve its efficiency, the NAO has prepared a strategic plan covering the period Among others, the goal of the Strategy is to help produce high quality audit work that meets international standards through instituting timely regular audits, developing the capacity to respond to changing technological environment, and establishing a fully functional performance audit and quality assurance units. The proposed project would help attain the above strategic objectives and support government s goal to enhance accountability in the use of public resources. It will also enhance its sustained capability to submit timely audit accounts during the PRGF period to ensure that the government remains on track.

20 7 3.5 Government s Current Program in Support of Economic Management and Financial Governance The PRSP II ( ) and the PRGF ( ) The Government s PRSP II ( ) has poverty reduction as its primary objective. One of the main strategies towards that objective is to improve public sector economic management and governance, particularly financial governance. The first of the five pillars of the PRSP II (2.4.1) is directly in support of economic management and good governance, as it stipulates: Creating an enabling policy environment to promote growth and poverty reduction. Towards that end the ( ) PRGF program aims at attaining the following: (i) improving revenue collection by strengthening institutional capacity; (ii) making the budget process more transparent and reflective of government priorities; (iii) reducing the domestic debt burden by maintaining a primary surplus and containing the government s borrowing requirement; and (v) maintaining low inflation and promoting sound and flexible financial system. The benchmarks for achieving the above are the following: (i) attain real GDP average annual growth of 6.3 percent; (ii) limit annual inflation in the range of 2 to 4 percent; (iii) attain an average annual surplus in basic fiscal balance of 2.7 percent of GDP; (iv) reduce the external current account deficit (including official transfers) to 11 percent in 2007; and (v) maintain an international reserve position, equivalent to 4-5 months of import cover. The proposed project would help meet the above PRSP II objectives and PRGF benchmarks by strengthening macroeconomic management and enhancing financial governance and accountability through support to the key institutions of economic management and financial governance mentioned above. Civil Service Reform To improve civil service and arrest the attrition in qualified and trained public employees, the PRSP underlines the need for undertaking civil service reform including improving of conditions of service, particularly pay packages. In support of the Civil Service Reform, the World Bank and the AfDB have already commissioned a study, which will eventually come up with recommendations on measures to improve the quality of the civil service and arrest the high attrition rate. The study is planned to be completed by early 2008, well on time to feed into the budget support appraisal that is planned for the second half of Donor Intervention The IMF, the World Bank, the UNDP, DFID, the ADF and the EU are the main development partners providing institutional support and technical assistance in the areas of economic management and financial governance. The IMF has provided institutional support and technical assistance in the areas of revenue administration, and the establishment of a Central Revenue authority. The IMF has also supported macroeconomic management through support to GBOS in the areas of national accounts and cost price indices. The World Bank also supported economic management through the installation of IFMIS and training of staff in its use. DFID and the EU have supported financial governance through assistance to the National Audit Office. Both DFID and the UNDP supported financial governance. The ADF`s Institutional Support for Capacity Building (1.2.1), which was completed in 2004, provided institutional support and technical assistance in project management and external debt management. Table 3.1 in Annex 7 provides a summary of the major interventions of donors in support of economic management and financial governance.

21 8 4. THE PROJECT 4.1 Project Design and Rationale The review in the preceding section of the main institutions involved in economic management and governance demonstrates that the process of economic management and governance is beset by institutional problems, involving shortages in skilled and trained manpower, the need for legislation to up-date the legal framework of certain key institutions, such as the NAO and the need to streamline the terms of reference of the institutions involved in aid coordination, so as to eliminate the existing overlap. The proposed ADF intervention through this project will support key institutions involved in economic management and fiscal and financial governance, such as DOSFEA, the National Audit Office, and SPACO. The ADF proposed project will assist the Government in attaining the benchmarks of its PRGF program ( ) and attain the PRSP II and the MDG targets The input involves: (i) human resource development through short-term and long-term local and external training; (ii) consultancy services in macroeconomic management, budgeting/fiscal management, and foreign debt management; (iii) supply, installation and training; IT hardware and software for the establishment of a local area network (LAN); and (iv) two short-term studies, which are priority for macroeconomic management and aid coordination. Human resource development represents a key input; emphasis will be on short-term training within the region, ranging between one to 4 weeks in financial management, project management, aid coordination, debt analysis and debt sustainability, auditing and field visits to best practice countries in poverty alleviation cross-cutting issues. The provision of three-30 months technical assistance team will assist the Government in meeting its commitments to implement the policy and institutional reforms under its medium-term program. The TA team will provide expert advice in critical areas pertaining to the preparation of the budget, the Midterm Expenditure Framework (MTEF) and macroeconomic modelling. 4.2 Complementarity and Synergies The training provided in macroeconomic and financial management, project management, debt analysis, audit, and the proposed field visits to learn from best practices in neighbouring countries are all based on actual needs of the beneficiary agencies and would create synergies with the intervention of other development partners. The training and the technical assistance team would constitute important synergies to other major donor intervention (the IMF s, World Bank, UNDP, the EU and DFID) in the implementation of the country s mediumtem development program. The installation of the local area network in DOSFEA, NAO and SAPCO would complement the World Bank s intervention through CBEMP, the UNDP s EMCBP and DFID s assistance provided to the National Audit Office. The undertaking of the two studies would fill in critical gaps and would constitute important synergic linkage to assistance in macroeconomic management provided by the IMF, the World Bank and other leading development partners. Within the Bank, the proposed project is consistent with the Bank s renewed focus in providing support in the area of economic and financial governance. It is based on the CSP and consistent with the draft JAS jointly prepared with the WB. The project will also build on and consolidate the success from the predecessor Bank institutional support for capacity building project that was completed in 2004.

22 9 4.3 Strategic Context The PRSP II ( ) and the PRGF ( ) (3.7.1), which constitute the country s medium-term development program for economic growth and poverty reduction, are based on the country s long term development objectives for attaining the Millennium Development Goals (MDG) and Vision The proposed ADF project is designed to assist the Government in attaining its strategic medium-term development objectives through strengthening institutional capacities and the provision of appropriate training to personnel in key economic management and financial governance institutions. The project in its focus on human resources development, provision of expertise in economic management and the installation of local area networks in key economic management institutions is central to the first pillar of the PRSP II, i.e. creating an enabling policy environment to promote growth and reduce poverty. The project will improve macroeconomic analysis, modelling and forecasting as well as budgeting and Mid-term Expenditure Framework (MTEF), all of which are crucial for attaining the PRSP and the PRGF and are synergistic to the IMF and World Bank interventions and those of other bilateral development partners. Attaining the objectives of the PRSP and the benchmarks for the PRGF is crucial to the eligibility for budget support of the Gambia. The installation of local area networks would complement IFMIS and related training provided by the World Bank, UNDP and DFID. 4.4 Project Objectives The project s objective is to contribute to strengthening capacities in key public institutions engaged in economic management and governance, with a view to helping reduce poverty. The targeted general areas of improvement are the following: (i) strengthening macroeconomic management; and (ii) improving financial governance and fiscal accountability. 4.5 Project Description The components of the project are the following: A. Strengthening Macroeconomic Management; B. Strengthening Financial Governance and Accountability The following project outputs are anticipated: (a) Improving macroeconomic management. (i) (ii) Improved economic management through the creation and use of macroeconomic models for forecasting, and through the training of senior and middle class cadres in macroeconomic policy analysis and in the use of macroeconomic modelling for forecasting of macroeconomic parameters; Improved financial and fiscal management through the refinement and dissemination of manuals in the use of advanced tools for budget and MTEF preparation and the dissemination of tools for revenue and expenditure forecasting. Improved financial and fiscal management is also anticipated through trained personnel in financial and fiscal policy analysis.

23 10 (iii) (iv) (v) (vi) (vii) Improved economic, financial and fiscal management through the installation of local area networks in DOSFEA, NAO and SPACO. PRGF and PRSP monitoring frameworks in place Reduction in the high level of domestic indebtedness and improved overall macroeconomic performance, as a result of improved economic, financial and fiscal management. Improving the process of aid coordination through streamlining the existing duplication in the process. Improved project implementation through pilot implementation of the proposed project. (b) Improving Financial Governance and Accountability (i) (ii) (iii) (iv) Improved public accounting and auditing through the procurement and installation of local area networks in each of DOSFEA and NAO and through training in the use of the network. Streamlined budget process and MTEF Timely audit and submission of Public Accounts Internal Audit System institutionalized The anticipated outputs enumerated above will be attained through the provision of the following project inputs and activities: Component (A): Strengthening of Macroeconomic Management Support under this component will be provided to the Department of State for Finance and Economic Affairs (DOSFEA) including the Strategy for Poverty Alleviation Coordination Office (SPACO). Support to DOSFEA will be across all Directorates and Units, but will be more focused on the Directorate of Economic Management and Planning. The main form of support will be through: (i) capacity building through human resources development; (ii) the provision of long-term and short-term technical assistance, (iii) the installation of an I.T local area network and the provision of office equipment and logistics support, and (iv) undertaking two short-term studies: one for constructing a macroeconomic model and another for streamlining aid coordination. Capacity Building through Human Resources Development: Training under the macroeconomic management component will fill in serious gaps in technical staff in the Directorate for Economic Management and Planning. It is proposed that the training involves 88 person/days of short-term local and regional training as well as three courses leading to Masters Degree. The local training will involve a five day local course for the staff of DOSFEA and the Central Bank of the Gambia (CBG) in the application of a macroeconomic model developed by the expert who will devise the model. The short-term regional courses will involve two fourteen day training courses in macroeconomic policy formulation and analysis and two one-month regional training courses in advanced financial management. The long-term courses leading to Masters Degree will involve training in economic policy analysis and

24 11 macroeconomic modelling and forecasting. In addition to long-term formal training, the senior managers in DOSFEA will also benefit from on-the-job training imparted to them by the three TA experts. Towards that end the grant agreement will make it a condition for the Government to nominate appropriate candidates to benefit from the presence of the TA experts. For the detailed training program refer to Annex 4. Training for SPACO involves 28 person/days regional training in poverty cross-cutting issues including gender as well as 2 person/week field visits to countries following best practices in poverty alleviation. Training for SPACO also further includes two three weeks regional training in gender development and management programs External public debt is one of the issues of high concern to the Government. The Debt Management Directorate in DOSFEA is understaffed in the areas of debt negotiations, and in the use of IFMIS in data processing. To fill this gap the proposed project involves the provision of 16 person/weeks of short term regional training in the area of public debt analysis and sustainability. Long-term and Short-term Technical Assistance: The project involves the provision of 30 person/months TA expert to provide support and build capacity in formulation and implementation of macroeconomic policy. The expert will render advice in a number of areas including most importantly in the design, implementation, monitoring and reporting on the PRSP and PRGF. The government is very concerned that they will not slip again on PRGF benchmarks meaning that the TA services in monitoring the PRGF is crucial. For the terms of reference of the macroeconomic expert, please refer to Annex 8A. Short term technical assistance under this category involves the commissioning of a study for constructing a Macroeconomic Model for the Gambia (Annex 8D) In support of improved public debt management, the project involves the provision of 30 person/months of TA expert in the area of public debt management. The public debt expert will, inter alia, provide the following: (i) review the overall task of external public debt management, and submit proposals with the objective of streamlining the process, in case of any overlap; (ii) review existing legal, institutional and regulatory framework for debt; (iv) give advice and guidance on negotiating public loans and debts; (v) review the training needs for debt management in the public sector and make recommendations on training needs. The detailed terms of reference for the expert is attached herewith as Annex (8C) The project further involves the provision of 30 person/month consultancy services in financial and fiscal management (Annex 8B). The expert, who will be assigned a national counterpart from DOSFEA will render, inter-alia, the following assistance: (i) provide advice to the Government on financial and fiscal policy reforms within the overall context of the PRGF and PRSP; (ii) provide short-term training courses to relevant staff in the areas of budgeting, and MTEF and develop a comprehensive training needs program in areas of financial and fiscal management; (iii) provide advise in the preparation of Public Expenditure Reviews and Public Expenditure Tracking system; (iv) prepare annual, short-term and medium-term public revenue and expenditure projection models, which would be used in the macroeconomic model to be designed by the macroeconomic expert; (v) prepare monitoring and assessment reports, as and when required by the Government, on the financial and fiscal targets as stipulated in the country s program (PRSP,PRGF, etc).

25 This component also involves a one-month consultancy service to undertake a review study of the aid coordination process with the objective of streamlining the existing overlap in the roles of NPC, DOSFEA and SAPCO. The terms of reference of the study is attached (Annex 8E). Installation of an IT local area network and the provision of office equipment and logistics Support: The project is planning to install a local area network for DOSFEA and SPACO. The sub-component for DOSFEA will involve the recruitment of an IT specialist to supervise the installation and configuration of a PABX system for 34 positions, the installation of a full server and UPS server room as well as software (Annex 4). The sub-component for SPACO will involve the installation and cabling of a network for 15 positions, a full server and UPS server room and a PABX system, as well as related hardware and software. Component (B): Financial Management and Accountability The beneficiary agency under this is the National Audit Office (NAO). Support for PFM will comprise human resource development, provision of long-term and short-term TA, installation of IT local area network and the provision of office equipment and logistics support. Capacity Building through Human Resource Development: The project is planning, to fill in critical shortages in qualified national cadres in auditing. It is proposed to provide a total of 128 person/week of external training for the National Audit Office (NAO) involving 26 person/weeks in regional and international short term training in advanced audit, as well as two 24 person/months in long-term training leading to degrees in audit. Installation of an IT local area network and the provision of office equipment and logistics Support: Support for financial management and transparency under this component will involve the installation of a local area network in the National Audit Office (NAO). This component will involve the recruitment of an IT specialist, the connection of 45 positions, the installation and configuration of PABX system and a full server, as well as appropriate hardware and software (Annex 6). Like the other similar sub-component under DOSFEA and SPACO, this component will have high synergic impact with the IFMIS system, which is supported by the World Bank. Component (C): Project Management The management of this project will be housed within the Central Project Management and Aid Coordination Directorate of DOSFEA instead of a full fledged Project implementation unit, thereby reducing the cost to the project and helping build the capacity of this Department in project management. Nevertheless, it is essential that the Directorate be provided with the necessary resources to manage the project effectively given that it is a newly established body.

26 13 Leveraging the existence of the newly established Directorate would strengthen it to undertake implementation and monitoring of other Bank projects in the future while also strengthening the capacity for project management and aid coordination in general. It is evident that the project cuts across several institutions. To ensure smooth project implementation the project provides for the designation of a coordinator from the CPMAC directorate in DOSFEA and an accountant, and a secretary. The Government is required to submit to the ADF appropriate nominees for the coordinator and accountant positions. This will be a condition precedent to entry into force of the grant agreement. The project has made provisions for 36 months for the remuneration of the project coordinator and accountant and for the day-to-day operating costs. Provisions are also made for three years audit of the project account. Allocations are also made for two four-wheel drive vehicles, one of which will be assigned to the Coordinator and the other for the use of the TAs in the course of their work. DOSFEA has few vehicles in its current pool. 4.6 Project Cost The estimated total cost of the project, net of taxes and duties, is UA 1,473,000 of which UA 1,123,000, equivalent to 76.2 percent is in foreign currency, and the balance, UA 350,000 is in local currency. A price contingency of 5 percent has been factored in the project cost. Table (4.1) below presents the estimated project cost by component and activity, whereas Table (4.2) presents the estimated project cost by Category of Expenditure. Details of the cost of human resources development, the TA and the IT inputs are presented in Annexes (4) to (6) respectively. Table 4.1 Summary of Project Cost Estimates by Component and Activity A. Strengthening of Macroeconomic Management B. Financial Management & Accountability C. Operating Costs Total Base Cost Price Contingency (5%) Total Project Cost In Gambian Dalasi (000) In UA (000) Local Foreign Total Local Foreign Total Cost Cost Cost Cost Cost Cost 7,421 34,262 41, ,014 2,803 7,710 10, ,504 2,185 5, , ,071 1, ,144 2, ,430 46,301 60, ,123 1,473 Table 4.2 Summary of Project Cost by Category of Expenditure Component Gambian Dalasi (000) UA (000) Local Foreign Total Local Foreign Total A. Goods 4,658 4,494 9, B. Services 5,813 37,272 43, ,045 C. Operating Costs 3,505 2,185 5, Total Base Cost 13,977 43,951 57, P. Cont. (5%) 2,863 4,043 6, Total Project Cost 16,840 47,994 64, ,123 1,473

27 Sources of Finance and Expenditure Schedule The project is financed through an ADF grant amounting to UA million, and a contribution from the Government, amounting to UA million, which represents 95.0 percent and 05 of the total cost, respectively. Table 4.3: Sources of Finance (000 UA) Local Foreign Total Percent The Government % The African Development Fund 277 1,123 1, % Total 350 1,123 1, % The Government s contribution of UA million will be used to finance part of the local costs of training and the entire operating expenses, covering the costs of fuel, vehicle maintenance, and salaries for the secretary and driver as well as office space rent. The annual expenditure by source of finance is presented in tables (4.4) and (4.5) respectively. Table 4.4 Annual Expenditure by Source of Finance (UA 000) Total ADF ,400 Government of The Gambia Total ,473 Table 4.5: Annual Expenditure by Activity (UA 000) Total A. Training B. Technical Assistance C. Information Technology D. Project Coordination Unit Base Total Price Contingency (5%) Grand Total , PROJECT IMPLEMENTATION 5.1 Executing Agency The executing agency will be the Department of State for Finance and Economic Affairs (DOSFEA). The project is planned to be implemented over a three year period. 5.2 Institutional Arrangements DOSFEA will manage the project through the Directorate of Central Project Management and Aid Coordination (CPMAC). It will appoint a project coordinator, accountant and secretary designated to the project and who will manage the project on a daily basis within the structure of the CPMAC. The Project Coordinator will provide technical assistance and

28 15 project management knowledge to the Director of CPMAC. The designated project management team will be appointed by the Government after approval by the Fund. The appointment of the Project Coordinator and the accountant will be made a condition precedent to first disbursement The project management team will be charged with coordinating all activities of the project including monitoring and evaluation, and for liaison with the ADF. Each beneficiary institution ((DOSFEA), National Audit Office and Strategy for Poverty Alleviation Coordination Office (SPACO)) will be in charge of implementing their respective components. The CPMAC, however, will effect procurement of all goods and services under the project and in accordance with this report. The CPMAC will undertake the preparation and transmission of quarterly progress reports and all procurement and disbursement documents in respect of goods and services provided for under the project. Members of the TA consultancy team will report directly to the Permanent Secretary, but they will have to keep the CPMAC informed about their work. 5.3 Project Implementation Schedule Project implementation is planned over a three year period, following the date of entry into force of the ADF grant protocol of agreement. The indicative implementation schedule is presented in Annex 13 and summarized in the following Table 5.1. DOSFEA will be responsible for the fulfillment of conditions prior to first disbursement of the grant protocol of agreement. Upon declaration of effectiveness, the ADF will carry out a launching mission to The Gambia. Table 5.1: Indicative Project Implementation Schedule Activity Agency Responsible Date 1. Board Presentation ADF November Grant Protocol Signature Government/ADF Fourth Quarter Entry into Force Government/ADF Fourth Quarter Appointment of the CPMAC Coordinator (Proj.) DOSFEA/ADF January Launching of the Project ADF First Quarter Advertisement for the posts of the TA experts PCU January Resumption of the TA experts of their post July First Supervision Mission ADF/PCU September Procurement & delivery of IT and office equipment, computers DOSFEA/NAO/SPACO/ January-June 2008 & vehicles 10. Installation of IT local area network DOSFEA/SPACO/NAO 3 rd. Quarter 08 to 2d. Quarter Training Program DOSFEA/NAO/SPACO June 2008-December Mid-term Project Review ADF/CPMAC June Invitation Requests for Study on Aid Coordination DOSFEA Second Quarter of Invitation of Requests for Study on Macroeconomic modelling DOSFEA Second Quarter of Third Supervision Mission ADF/CPMAC First quarter 2010 Annual Audit Report submissions June 2009/June 2010/June Project completion December Procurement Arrangements The procurement arrangements are summarized in the next Table 5.2. All procurement of goods and acquisition of consulting services financed by the Bank Group will be in accordance with the Bank s Rules of Procurement and Rules of Procedure for the Use of Consultants, using the relevant Bank Group Standard Bidding Documents.

29 Procurement of Goods: Procurement of goods involves the delivery, installation and configuration of ITC equipment for three local area networks: one each at DOSFEA, SAPCO, and NAO. Each set of equipment includes PABX system, a full server, UPS server room, network cabling of a total of 94 positions, plus an appropriate combination of software and desktop computers. This component, which is valued at about UA 279 thousand will be procured through national competitive bidding, as there are representations of international computer companies in Banjul. The company to bid for this component will have to provide cost estimates for a complete package, including the supply of equipment and materials, installation and configuration of the hardware, staff training, as well as back-up and maintenance services. The extent, mode and text of the advertisement must be approved by the ADF, prior to its publication in three local papers. The training equipment for the National Audit Office (NAO), amounting to about UA 33 and the procurement of two four-wheel drive vehicles, amounting to about UA 53 thousand is to be done through the UNDP Inter-Agency Procurement Services Office (IAPSO), since the amounts involved are relatively small and procurement through IAPSO for such type of equipment has a good track record. Table 5.2 Procurement Arrangements 1 (UA 000) Category ICB NCB 2 IS 3 Short List Other Total 1. Goods 1.1 ITC local area network, including installation and training (DOSFEA/SPACO/NAO/) 1.2 Training equipment for NAO 1.3 Two 4-wheel Drive vehicles (DOSFEA) (UA 248) (UA 33) (UA 53) (UA 86) (UA 248) (UA 33) (UA 53) Total Goods (UA 248) (UA 334) 2. Services 2.1 External short and long-term training and local workshops p/m TA 2.3 Study on Aid Coordination (1 p/m) 2.4 Study on Macroeconomic Modelling 2.5 Annual Audit of Project Accounts 2.6 Project Coordination Unit 2.7 Operating Expenses months rent (UA 366) (UA 6) (UA 9) (UA 25) (UA 367) (UA 35) (UA 21) (UA 367) (UA 366) (UA 6) (UA 9) (UA 25) (UA 60) (UA 35) (UA 21) Total Services (UA432) (UA 476) (UA 908) Acquisition of Technical Assistance Team: The recruitment of the services of three experts for 30 months each involves a cost of UA 367 thousand. Recruitment of the expertise services will be on the basis of short list. The terms of reference for each of the consultants are attached (Annexes 6-8). The ADF will have to give its no-objection to the extent, mode and text of the advertisement, prior to its publication in international and regional papers. 1 Numbers in brackets indicate ADF financing (Base Cost). 2 NCB = National Competitive Bidding. 3 IS = International Shopping.

30 Development of Human Capacity: The project involves two local workshops of 115 person/day, 76 person/weeks of short regional training courses and 120 person/months of long-term external training leading to degrees in economics, statistics and auditing. The entire cost of the human resources component is about UA 367 thousand. The type and duration of each training course is listed in Annex (4). Most of the external short training courses are to be in regional training institutions; the choice of the specific training institution is, however, left to the beneficiary agency. The ADF, however, has made it a condition, under other conditions to approve the list of trainees for each course. To ensure sustainability of the human resource development component, the project has made it an undertaking for the Government to submit to the ADF documentary evidence that the staff selected for long-term external training will sign bond agreements to serve a minimum period, equivalent to the duration of the course. Gender balance will also feature in the selection of staff for training with the aim of ensuring female staff participation. At the moment no single female staff of DOSFEA has a graduate degree. Therefore, at least one female staff would be included as one of two beneficiaries to the longterm training leading to MSc in economic policy and macroeconomic management Project Operating Costs: The Government will submit to the ADF for its nonobjection nominees for the project coordinator, an accountant and a secretary. These will be nominated from within DOSFEA and will receive a monthly honorarium from the project over and above their salary. The remuneration amount allocated to this purpose is about UA 65 thousand and for the operating budget is about UA 35 thousand which will include rental cost for office space for the directorate. This is also integral to the support to the CPMAC as the key project staff are supposed to transfer project management skills to other CPMAC staff. The Project Coordinate will indeed be recruited to provide, among others, specific technical assistance support to the Director of CPMAC. In other words, no separate project unit will be established. The Government, through its counterpart funding is responsible for the operating budget. The Government will fully justify eligible expenditures through appropriate supporting documents Audit of the Project Accounts: An amount of about UA 25 thousand has been allocated for carrying out three annual audits. The audit is to be carried out by an external audit firm through a short-list, to be approved by the ADF. A single three-year audit contract could be concluded so as to avoid repeating the selection process every year General Procurement Notice: the ADF and the Government will agree on a General Procurement Notice (GPN) upon approval of the grant agreement by the ADB Board of Directors. The GPN will be issued for publication in the United Nations Development Business (UNDB) ADF Review Procedures: The following documents are subject to review and approval by the Bank before promulgation: (i) Specific Procurement Notices (SPNs), (ii) short list for the procurement of services, (iii) tender documents or requests for proposals from consultants; (iv) lists, specifications, tender documents and draft contract agreements for the procurement of ITC goods, vehicles and training materials; and (v) tender evaluation reports, including recommendations by the Government for contract awards.

31 Disbursement Arrangements The Department of State for Finance and Economic Affairs (DOSFEA) will open a special account The Special Account in a bank acceptable to the ADF for the deposit of the grant proceeds and from which disbursements of grant proceeds shall be made for the project. The grant resources required to meet the ADF s share for the first six months of local expenses will be deposited in the Special Account. The ADF will replenish the Special Account, at the request of DOSFEA, after receiving justification for the use of at least 50 percent of the amount previously deposited into the Special Account. The request for the replenishment of Special Account will be considered by the ADF in light of the work program, submitted by the Government. DOSFEA will also open a separate local currency account in a bank acceptable to the ADF for the deposit of the Government s counterpart funds. All disbursement methods, such as direct payment, reimbursement method, reimbursement guarantee, and revolving fund, will be available for utilization as appropriate, subject to the Bank Group s rules and procedures. 5.6 Monitoring and Evaluation The Bank will undertake a launching mission in the first quarter of 2008, by which time the government would have fulfilled all conditions precedent to first disbursement. Supervision missions will be undertaken once annually. As per the Bank s general conditions, the Government will have to submit quarterly progress reports on the implementation of the project. Each beneficiary institution will submit quarterly progress reports in form and substance satisfactory to the Bank on the implementation of their respective components to the executing agency, which is the CPMAC directorate in DOSFEA. The quarterly progress reports will present the status of physical and financial implementation and highlight any problem that might hamper smooth project implementation. The reports will review progress made in light of the Project s Results-Based Logical framework and include a clear presentation of activities undertaken during the period under review. The reports will also analyse to what extent the activities undertaken have contributed to the realization of the anticipated results/outputs and project objectives. One single consolidated progress report will be submitted to the Bank on a quarterly basis, not later than one month after the end of such quarter. The reports will also make recommendations to tackle any problem encountered and present time-bound actions/work plans for the following quarter. The CPMAC directorate will also prepare and maintain summary record of the meetings by the Steering Committee, to be submitted to the Bank no later than one week after such meeting. Recommendations made by the Steering Committee and action taken by relevant parties will be clearly indicated in the quarterly progress reports. The Executing Agency will also be required to prepare and submit to the Bank a Project Completion Report within three months of the final disbursement, in accordance with the Bank s General Rules and Procedures. 5.7 Financial and Audit Reporting The CPMAC directorate will maintain separate special accounts for the project to ensure effective monitoring and control of expenditure made. A special account will be opened in foreign exchange to receive ADF project funds and another account in local currency to receive the Government s counterpart funds. Also an Asset Register should be maintained to

32 19 register in all physical assets procured through the project funds. These accounts shall be made accessible to the Bank for its review. The accounting system will distinguish project expenditure by component, category, contract and source of finance. Project accounts will be audited annually by an external auditor acceptable to the Bank to be financed from project resources. The accounts will be audited once a year and the audit reports and accompanying financial statements, including bank statements will be submitted to the ADF within six months from the closing of the financial year. 5.8 Donor Coordination and Harmonization Donor coordination by Government is practically non-existent, and this has continued to impact negatively on resource mobilization. The newly established CPMAC is not capable of playing an effective role in carrying out its mandate, mainly in view of staff constraint, as currently it has only one economist in addition to a Director, which assumed her post in May Another serious constraint is the lack of clarity in the mandate of aid coordination, as there is an overlap with The National Planning Commission, SPACO and the Policy Analysis Unit at the Office of the President (3.3.1). To resolve the issue of overlap, the project will finance a short-term study, which will make specific recommendations to the Government on streamlining the mandate of aid coordination between DOSFEA, NPC, SPACO and PAU. The commissioning of the study is made an undertaking under other conditions In spite of weak coordination, donor intervention has generally been consistent with the strategic objectives and priorities of the PRSP. The UNDP plays the leading role of coordinating donor assistance in The Gambia. However, intra-donor coordination is done on an ad hoc basis, and as such it is not considered very effective. The last Round Table Conference, the third of its kind, was held in (2002). Preparations are currently underway to hold the next Round Table Conference in November Yet still some harmonization of donor work is slowly evolving in the context of the Paris Declaration on harmonization and alignment for development effectiveness. The World Bank and the Bank are working on a Joint Assistance Strategy for The Gambia. Donors have also committed to harmonize their intervention in the public sector around the planned civil service reform strategy. 6. SUSTAINABILITY AND PROJECT RISKS 6.1 Recurrent Cost The recurrent project costs, during project implementation are estimated at about UA 114 thousand, which is just over 7 percent of the total project costs. These costs will mainly be in respect of administrative costs of the CPMAC, office rent and operating costs. In view of the government s budgetary constraints, only UA 60 thousand of the recurrent costs will be borne by the government, and this amount will finance operating costs, such as vehicle expenses and IT maintenance costs. The financial implications of the government s contribution to total project costs on the budget will be minimal, as the costs will be mainly in respect of maintaining IT and office equipment, estimated at about UA 30,000, which is an insignificant amount of the overall government s recurrent budget costs. The project does not involve the creation of new posts, as the costs of the additional staff for DOSFEA (5.8.2) are already provided for in the 2007 budget.

33 Project sustainability The project benefits have a good chance of being sustainable, given the Government s renewed commitment to implementing critical elements of its program to improve macroeconomic management and governance. These elements constitute critical goals of the PRSP and PRGF, whose successful implementation pose a serious challenge for the Government. The chances of project sustainability are also considered high because it has been designed to supplement the intervention of other major development partners. We have seen in paragraph 4.2 above, that the project inputs will have synergic impact to other major development partners in the areas of macroeconomic management and fiscal and financial governance. The fact that the project complements existing efforts in policy reforms improves the sustainability of the project. Sustainability over the medium to long term is also expected since the government has initiated measures, which are directly relevant to the success of the project. One such measure is the initiation of a comprehensive Study on Civil Service Reform 1 (3.7.2), which when completed by early 2008, will provide concrete recommendations on policy and institutional reforms to arrest the high attrition rate in public service. 6.3 Main Risks and Mitigating Measures A major risk to the sustainability of benefits of the project is the weakening of the government s resolve to continue with its economic policy and governance reforms. A strong mitigation is the association of HIPC benefits to benchmark indicators under the PRGF, which some indicators have been integrated in the project. It is also essential to maintain close supervision of the project and involving SNFO in the supervision of the project A second critical risk to the sustainability of the project benefits, particularly investments in human resources development, is continuation of the current high attrition rate of civil servants. A mitigating built-in factor to safeguard against the attrition of trained civil servants is the incorporation of an undertaking by the government, under other conditions providing documentary evidence that the staff selected for long-term external training have signed bond agreements to serve a minimum period. Another mitigating factor for the longer term is that the government s willingness to launch civil service reform A third risk to the sustainability of the project benefits, which is common to most country portfolios financed by the AfDB, is the risk of slow implementation of the proposed project. This will have the impact of diluting the project benefits and reduce the synergic impact with other donor-funded projects. The major problems, which hinder or delay project implementation, relate to inadequate managerial and technical capabilities, particularly in as far as it relates to fulfilment of conditions precedent to first disbursement, and conforming to the Bank s procurement, and disbursement rules and regulations. To mitigate the negative impact of this risk, the project has provided for a management team in the CPMAC directorate. Dedicated staff comprising a project co-ordinator, an accountant, and secretary, whose qualifications and experience are acceptable to the ADF has been built into the project. In addition, the Country Office in Senegal will facilitate improved coordination and faster resolution of problems as they emerge. 1 Conducted by the World Bank and the AfDF, with expected contribution by DFID.

34 21 7. PROJECT BENEFITS AND IMPACT 7.1 Economic Benefits Through the development of improved economic management, and improved financial and fiscal governance, the project aims to contribute to the attainment of the government s overall objective of promoting growth and reducing poverty. The human resource development program coupled with the technical assistance and IT inputs would lead to improved preparation and management of the budget and the MTEF, and to the development of a suitable macroeconomic model and improved projections of public revenues and expenditures. These, in turn, would empower the government in the preparation and implementation of the next generation of medium-term development programs, such as the PRSP, MDG and PRGF. Similarly, the support provided by the project to institutions involved in financial and fiscal governance, such as DOSFEA, and NAO will improve financial and fiscal transparency and accountability. In particular, the project will contribute to improving public accounting and auditing, mainly through human resources development, installing local area networks, which are compatible with the first and subsequent phases of IFMIS Project support through the commissioning of a short-term study on Aid Coordination would help underscore and bring into light the current overlap in the process of aid coordination. It is hoped that the recommendations of this study would eventually lead to enabling the government play the lead role in aid coordination. 7.2 Impact of Project on Cross-cutting Issues Social Impact and Poverty Reduction: The project will have a marked social impact, since it will eventually improve the government s managerial and technical capacity in macroeconomic management and strengthen fiscal and financial governance. The proposed short-term training courses and the planned field visits to regional counties with best practices in poverty issues and in community participation, will improve the capacity of SPACO in assessing poverty and in planning and evaluating poverty programs. The provision of specialized training in gender development will contribute to enhanced gender-based poverty reduction planning and gender budgeting. The installation of local area network and appropriate computer software and hardware will also improve the data base on poverty. Budget support is currently under consideration as a future mode of donor support to The Gambia. A strengthened Public Financial Management system will lay the foundation for a solid and effective budget support and for the government to demonstrate to its partners its fiduciary compliance and prudent economic management Impact on Gender: The scope and quality of gender issues in future PRSPs will be improved as a result of the training courses given and the establishment of the local area network. Gender budgeting would be integrated in the training provided on gender development expecting that this would ensure the mainstreaming of gender issues in the national budget. The AfDB in considering the proposed list of candidates for the training courses will give due consideration to female candidates. This is in line with the explicit Action Plan of The Gambia, which highlights the need for a significant percentage of women to be trained and promoted by 2011.

35 Impact on Private Sector Development: The project will contribute positively to private sector development through the creation of an enabling macroeconomic policy environment. Improved macro-fiscal policies and governance will improve the confidence of the private sector, both domestic and foreign, in the future of the Gambian economy Impact on the Environment: The project will not have a negative impact on the environment. The training provided in areas of policy analysis and project implementation will cover issues related to assessment of environmental impact. The proposed project is environmentally classified as Category Impact on Governance: The project will significantly contribute to good fiscal and financial governance, particularly through human resource development, technical assistance, and I.T. support to DOSFEA and the National Audit Office. As seen earlier, the project will improve the quality and timeliness of public accounting and auditing and contribute to improved domestic and international confidence in institutions of governance in general. Furthermore, strengthened economic financial management institutions and processes will lead to increased accountability, reduced public sector corruption and more efficient use of public resources for poverty reduction. 8. CONCLUSIONS AND RECOMMENDATION 8.1 Conclusions The proposed project is designed to support the Government s efforts in national capacity building in the area of economic management and financial and fiscal governance. It has important synergistic linkages to the intervention of other development partners. It complements the IMF s PRGF program ( ) and complements other capacity building projects financed by the World Bank s, DFID s and UNDP. 8.2 Recommendations It is recommended that an ADF grant, not exceeding UA 1.4 million, be granted to the Republic of The Gambia for the purpose of implementing this project as described in this report, subject to the following specific conditions: (A) Conditions of Effectiveness of the Grant The entry into force of the Protocol of Agreement will be subject to its signature by the Fund and the Government of The Gambia. (B) Conditions Precedent to First Disbursement of the Grant Protocol The obligation of the ADF to make the first disbursement shall be conditional upon the entry into force of the Protocol of Agreement and the fulfillment by the Recipient of the following conditions:

36 23 Prior to first disbursement, the Government shall have: (i) (ii) (iii) Designated a full-time Project Coordinator and an accountant whose qualifications and experience shall have been accepted by the Fund (5.2.1) Provided evidence that a bank account for the project has been opened in a local bank acceptable to the Fund (5.5.1). Nominate government counterparts to the Technical Assistance Consultants including designating the Project Coordinator as Technical Assistant to the Director of CPMAC department (4.1.2) (C) Other Conditions: In addition, the Recipient shall provide evidence, in form and substance satisfactory to the ADF: (i) (ii) The Government undertakes to commission the proposed Study on Aid Coordination with the objective of removing the overlap in the aid-coordination process, which is currently shared between DOSFEA, NPC, SPACO and PAU (5.8.2).; The Government undertakes to submit to the Fund documentary evidence that the staff selected for long-term external training, including at least one female, have signed bond agreements to serve a minimum period (5.4.4);

37 Institutional Support Project for Economic Management and Governance Annex 1

38 Gambia: Institutional Support Project for Economic Management and Governance BANK GROUP OERATIONS AS OF 31 MAY 2007 Annex 2 Page 1 of 2 Sector name Source of Finance Project title Approval date Signature date Amount Approved Amount Signed Amount Cancelled / Capital Increase Net Amount Signed Disbursements Undisbursed Balance Disbursement ratio Agriculture ADB FISHERIES DEVELOPMENT 23-Aug Sep-83 3,437, ,437, ,437, % ADB Total 3,437, ,437, ,437, % Agriculture ADF COTTON PRODUCTION DEVELOPMENT 9-Oct Nov-74 1,842, ,842, , ,285, ,285, % Agriculture ADF FARMER MANAGED RICE IRRIGATION 27-Apr May-05 5,500, ,500, ,500, , ,158, % Agriculture ADF FISHING DEVELOPMENT PROJECT 25-Aug-83 6-Feb-84 7,318, ,318, ,598, ,720, ,720, % Agriculture ADF INVASIVE AQUATIC WEEDS GAMBIA 22-Sep-04 9-Dec , , , , % Agriculture ADF JAHALY PACHARR RICE 18-Mar Aug-82 4,236, ,236, , ,231, ,231, % Agriculture ADF LISTOCK DEVELOPMENT 27-Jan-83 7-Feb-83 8,593, ,593, , ,568, ,568, % Agriculture ADF LIVESTOCK DEVELOPMENT STUDY 14-Jul Oct , , , , , % Agriculture ADF NERICA DISSEMINATION PROJECT GAMBIA 26-Sep-03 3-Nov-03 1,560, ,560, ,560, , ,380, % Agriculture ADF OMVG GESTION RESSOURCES NATURELLES 14-Jun May-02 2,030, ,030, ,030, ,465, % Agriculture ADF PERI-URBAN AGRICULTURAL DEVELOPMENT PROJECT 27-Oct-99 8-Nov-99 5,070, ,070, ,070, ,712, , % Agriculture ADF PROGRAMME D'AMENAGEMENT AGRICOLE DES BAS- 19-Nov Dec-96 4,000, ,000, ,999, ,999, % FONDS Agriculture ADF RICE DEVELOPMENT PROJECT 23-Feb Mar-88 4,798, ,798, , ,739, ,739, % ADF Total 45,837, ,837, ,461, ,376, ,140, ,671, % Agriculture NTF ARTISANAL FISHERIES DEVELOPMENT PROJECT 17-May Jan-01 2,900, ,900, ,900, ,218, ,681, % Agriculture NTF Participatory Integrated Watershed Manag 9-Jun-04 9-Dec-04 4,950, ,950, ,950, , ,967, % 7,850, ,850, ,850, ,200, ,649, % NTF Total AGRICULTURE TOTAL 57,124, ,124, ,898, ,226, ,340, ,320, % Environment ADF COASTAL PROTECTION PROJECT 13-Sep-01 3-Oct-01 9,590, ,590, ,590, ,559, , % Environment ADF COASTAL PROTECTION STUDY 4-Sep Oct , , , , , % Environment Total 10,420, ,420, , ,260, ,230, , % Ind/Mini/Quar ADF GROUNDNUT PROCESSING INDUSTRY (PHASE I) 29-Nov-79 3-Dec-79 4,605, ,605, ,150, ,454, ,454, % Ind/Mini/Quar ADF TOURISM MASTER PLAN STUDY 22-Nov Jan , , , , , % Ind/Mini/Quar Total 5,420, ,420, ,150, ,269, ,973, , % Multi-Sector ADF INSTITUTIONAL SUPPORT PROJECT FOR CAPACITY 28-Oct Jan , , , , , % BUILDIN Multi-Sector ADF MULTI SECTORAL REHABILITATION 29-Oct Dec-86 9,210, ,210, ,210, ,210, % Multi-Sector ADF SECOND STRUCTURAL ADJUSTMENT LOAN 16-Jan Jan-90 6,447, ,447, , ,198, ,198, % Multi-Sector ADF SOCIAL DIMENSION OF ADJUSTMENT 20-Sep Feb-89 1,998, ,998, , ,969, ,969, % Multi-Sector Total 18,417, ,417, , ,017, ,017, % Power ADB ELECTRICITY DISTRIBUTION IN BANJUL 14-Oct-75 5-Jan-76 2,000, ,000, , ,995, ,995, % Power ADB ELECTRICITY PROJECT (PHASE II) 23-Jan Feb-79 5,000, ,000, , ,979, ,979, % ADB Total 7,000, ,000, , ,975, ,975, % Power ADF ENGINEERING STUDY OF RURAL ELECTRIFICATION PROJECT 21-Oct-93 4-Jan-94 1,370, ,370, , , , % Power ADF Renewable Energy Study 30-Oct Nov , , , , , % Power ADF RURAL ELECTRIFICATION PROJECT 14-Dec Jan-01 2,970, ,970, ,970, ,839, , % Power Total 12,089, ,089, , ,443, ,169, , %

39 Gambia: Institutional Support Project for Economic Management and Governance BANK GROUP OERATIONS AS OF 31 MAY 2007 Annex 2 Page 2 of 2 Sector name Source of Project title Approval Signature Amount Approved Amount Signed Amount Cancelled / Net Amount Signed Disbursements Undisbursed Disbursement Finance date date Capital Increase Balance ratio Social ADF BASIC EDUCATION PROJECT (EDUCATIION III) 11-Sep Nov-02 10,000, ,000, ,000, ,437, ,562, % Social ADF COMMUNITY SKILLS IMPROVEMENT PROJECT (WID II) 16-Feb Mar-00 5,850, ,850, (38,885.77) 5,888, ,859, ,990, % Social ADF EDUCATION PROJECT II 24-Aug Oct-92 4,973, ,973, ,036, ,937, ,937, % Social ADF ENTREPRENEURSHIP PROMOTION AND MICROFINA 15-Nov Dec-06 8,000, ,000, ,000, , ,326, % Social ADF FEASIBILITY STUDY OF EDUCATION PROJECT 23-Jun Jul , , , , , % Social ADF HEALTH SECTOR STUDY 11-Sep Oct , , , , % Social ADF HELTH SERVICES DEVELOPMENT PROJECT II 10-Dec Mar-98 7,000, ,000, ,000, ,866, ,133, % Social ADF POVERTY REDUCTION PROJECT 10-Dec Jan-98 3,210, ,210, , ,182, ,182, % Social ADF PRIMARY EDUCATION IMPROVEMENT 27-Nov Dec-86 4,144, ,144, ,144, ,144, % Social ADF REHABILIT.OF HEALTH TRAINING FACILITIES 27-Jan Mar-92 7,092, ,092, ,622, ,469, ,469, % Social ADF WOMEN IN DEVELOPMENT PROJECT 14-Mar Mar , , , , , % Social ADF WOMEN IN DEVELOPMENT PROJECT(GRANT) 14-Mar Mar-90 1,943, ,943, , ,941, ,941, % Social Total 54,000, ,000, ,157, ,842, ,791, ,012, % Transport ADB BANJUL SEA PORT 22-Jun Aug-82 7,000, ,000, , ,982, ,982, % Transport ADB BANJUL SERREKUNDA HIGHWAY PROJECT 29-Aug-79 3-Dec-79 3,900, ,900, ,900, ,900, % ADB Total 10,900, ,900, , ,882, ,882, % Transport ADF BANJUL PORT PROJECT II 14-Dec-93 4-Jan-94 16,000, ,000, , ,526, ,526, % Transport ADF BANJUL-SEREKUNDA HIGHWAY(SUPPLEMENTARY) 22-May May-89 2,109, ,109, , ,104, ,104, % Transport ADF INSTITUT.SUPPORT TO MWC E.F ROAD(GRANT 30-Oct Jan-92 2,763, ,763, , ,755, ,755, % Transport ADF LAMINKOTO-PASSIMUS ROAD 28-Aug Sep-80 8,000, ,000, ,000, % ADF Total 43,378, ,378, ,513, ,865, ,865, % Transport NTF YUDUM AIPORT CONSTRUCTION 28-Oct Mar-77 2,000, ,000, , ,982, ,982, % Transport NTF YUDUM AIRPORT CONSTRUCTION(PHASE IV) 8-Jun Aug-82 4,500, ,500, , ,714, ,714, % NTF Total 6,500, ,500, , ,696, ,696, % Transport Total 60,778, ,778, ,334, ,444, ,444, % Water Sup/Sanit ADF BANJUL SEWERAGE AND DRAINAGE PROJECT 24-Apr Jun-80 7,368, ,368, , ,101, ,101, % Water Sup/Sanit ADF GREATER BANJUL WATER SUPPLY 25-Nov Apr-88 5,618, ,618, , ,396, ,396, % Water Sup/Sanit ADF WATER SUPPLY & SANITAT STUDY FOR PHASE 12-Jun-02 8-Aug-02 1,175, ,175, ,175, , , % Water Sup/Sanit Total 14,161, ,161, , ,673, ,211, , % 232,412, ,412, ,234, ,177, ,178, ,395, GRAND TOTAL 83.11%

40 Annex 3 The Gambia: Institutional Support Project for Economic Management and Governance DOSFEA: ORGANIZATIONAL STRUCTURE Total DOSFEA establishment (excluding support personnel) 231 Number of Staff in Post (excluding support personnel) 91 (39%) Secretary of State Permanent Secretary I Permanent Secretary II Deputy PS Finance & Admin. Deputy PS (Economic Affairs) AGENCIES Gambia Divestiture Treasury Directorate 41(111) Expenditure Unit 4(13) Directorate of Debt Management 3(16) Gambia Public Procurement Gambia Public Utilities Regulatory Authority Gambia Bureau of Statistics. Units without Staff Internal Audit Unit 4 (24) Directorate of Budget (1) Administration & Clerical 11(7) Accounts Unit 3(4) Documentation Centre 0(3) Directorate of Economic Management & Planning 8(10) Data Processing Centre (7) SPACO 4(14) N E P A D 0(2) The first figure in each box relates to the number of Staff in post, the second (in brackets) to then establishment as given in the 2006 Budget Book. Both figures relate to operational staff and exclude support personnel e.g. messengers, security guards, drivers, etc. Central Project Management & Aid Coordination 2(7)

41

42

43

44

45

46 Annex 5 Page 2 of 2

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