Implementation Status & Results Cote d'ivoire Governance and Institutional Dev. (P107355)

Transcription

1 Public Disclosure Authorized Public Disclosure Authorized The World Bank Implementation Status & Results Cote d'ivoire Governance and Institutional Dev. (P107355) Operation Name: Governance and Institutional Dev. (P107355) Project Stage: Implementation Seq.No: 6 Status: ARCHIVED Last Modified : 12-Apr-2011 Country: Cote d'ivoire Approval FY: 2008 Product Line: IBRD/IDA Region: AFRICA Lending Instrument: Emergency Recovery Loan Implementing Agency(ies): Ministry of Economy and Finance Key s Board Approval 12-Jun-2008 Original Closing 15-Dec-2012 Planned Mid Term Review Last Archived ISR 29-Jun-2010 Effectiveness 22-Oct-2008 Revised Closing 15-Dec-2012 Actual Mid Term Review 05-Oct-2010 Project Development Objectives Project Development Objective (from Project Appraisal Document) The project development objective (PDO) is to contribute to strengthen Government's capacity to (i) enhance efficiency and transparency in the use of public resources; (ii) manage the development of its hydrocarbon resources in an environmentally and socially sound and sustainable manner; and (3) foster governance and efficiency in the cocoa sector. Has the Project Development Objective been changed since Board Approval of the Project? Yes No Component(s) losure Authorized Public Disclosure Authorized Component Name Component Cost Strenghtening Public Finance Management 4.50 Strenghtening Capacity to Manage the Upstream Petroleum Sector 2.90 Setting up an Adequate Institutional and Regulatory Framework for the Cocoa Sector 2.00 Project Management and Communication 3.60 Overall Ratings Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Satisfactory Moderately Satisfactory Overall Risk Rating Implementation Status Overview As observed during the mid-term review that took place early in September, the project did achieve many important results in terms of disbursements rate and deliveries. After 23 months of existence, the project was enjoying a disbursements rate of about 50 percent, which was quite remarkable given that the project included activities related to the oil and gas sector which usually takes long time to be implemented. The ongoing political developments in Ivory Coast, which have led to the Banks suspension of operations in the country, Page 1 of 17

2 constitute a huge set-back which will likely reverse the good results that were achieved. With regard to the three major components of the project, the September mid-term review revealed the following: 1. Public Financial Management. The National Procurement Regulatory Authority (NPRA) was operational and started handling procurement compliances. Yet, the review recommended the recruitment of a consultant to harmonize procurement texts so as to address the issue of conflict of interest between the control and regulation functions. Furthermore, it was felt that additional training was needed for the NPRA staff to increase their performance. A significant set-back occurred in November with the robbery of important materials including computers and servers that took place in the offices of the NPRA. The integrated expenditure chain SIGFIP has been deployed throughout the country, which is indeed a major achievement. All the 59 districts (departments) of the country were in September 2010 all connected to SIGFIP. The interface between SIGFIP and the accounting and treasury system (ASTER) was also done. The next phase that remained was the deployment of the ASTER, as has been the case for SIGFIP, to the rest of the country. The mid-term review noticed the deficit and inadequacy of buildings for the housing of the SIGFIP which constituted a great handicap for its full performance. Unfortunately, the project cannot be used to build or renovate offices. Other development partners or the Government could step in to fill this gap. The present suspension of operations in Ivory Coast does not allow the signing of the contract for the deployment of ASTER which should have normally been done. A delay is also being observed with the development of the Integrated Human Resources Information Management System (SIGFAE) for which the contract with an IT firm was also about to be signed. If and when political stability returns in Ivory Coast and the Bank decides to resume operations, a thorough review of the PFM system should be conducted, especially with regard to the fundamentals (e.g. robustness of internal controls, budget reliability and predictability, and strategic alignment). Before the political crisis, there was a strong momentum toward achieving the HIPC completion point, and the country was doing well in terms of related PFM triggers. It is evident that the exceptional situation of crisis and war has led to unorthodox financial practices and the lack of control in procurement and the expenditure chain. Strengthening of internal controls and audits will need to be quickly carried out when normal situation returns. 2. Cocoa and Coffee Sector Most of the activities envisaged under this component have already been accomplished. They included: (i) audit of the entities overseeing the cocoa sector: (ii) design of strategy to reform the cocoa sector: and (iii) census of cocoa growers. The firms which were hired for the implementation of these activities have submitted their reports. However, as significant as are the audit and diagnostic reports, it will also be critical to ensure that deep reform of the sector is undertaken and concrete results on the ground are achieved. Clearly, strong political will is needed to implement recommended reforms. 3. Oil and Gas Sector After a slow beginning in the implementation, the mid-term review noted a substantial pick-up in the execution of the activities planned under the Oil and Gas Component. These activities include: (i) improvement of transparency and efficiency in the management of the energy sector; (ii) strengthening of the country capacity to negotiate production-sharing contracts through an update of the oil and gas code which is now more in tune with the new international energy context. This revised code focuses more on: (i) better prediction and maximization of petroleum revenues across time; (ii) management of social and environmental impacts of petroleum operations; (iii) helping the country to maintain its regional leadership on the energy market through reforms which will enable her to capture a bigger portion of the international price of its exports. All the diagnostic reports, studies, and reviews envisaged for this sector have already been produced. Another important aspect related to this component is the assistance for the EITI process, which has also registered some positive developments. The Final Report for the validation and thus conformity of Ivory Coast was ready at the time of the mid-term review and was supposed to be presented to the International Secretariat of EITI in Oslo last November. When the Bank resumes after the ongoing crisis, it is possible that the new government will seek to revisit some gas and oil contracts which were in a not transparent way and more efforts will also be done to rationalize and improve the efficiency of this strategic sector. The EITI process will be quickly reactivated and lead to the conformity status. Results Project Development Objective Indicators Page 2 of 17

3 Access of public to principal budget information PEFA Indicator : C (2008) The budgets for 2008, 2009, 2010 were adopted and promulgated by presidential ordinance. Quarterly budget execution reports were issued for all quarters of 2008, 2009 and the first quarter of 2010 were posted on the MOF website ( which is fully operational as of November Before the current crisis, reports were issued regularly every quarter. Even now, budget information continues to be published, although the quality has significantly declined. s: After a significant improvement of the PEFA rating prior the November 2011 presidential election, it has certainly worsened since then. The next PEFA assessment was initially scheduled to be conducted in 2011, but this will likely take place in PEFA Indicator : B (2012) Page 3 of 17

4 Composition of real expenditure accordingly to the initial approved budget PEFA Indicator : D (2008) In order to achieve the HIPC Completion Point, prior to the curent political crisis, the authorities had substantially improved budget composition. In the 2010 budget law, pro-poor spending related to social sectors were closely monitored by the Bank and Fund in the context of the PRSP implementation. With the current civil war and political crisis, the situation has certainly worsened. PEFA Indicator : C (2012) Page 4 of 17

5 New contracts are subject to new terms and conditions of the new regulatory framework New regulatory framework not initiated in Jan-2008 The authorities have taken steps and prepared a draft hydrocarbon code which is in the process of being validated nationwide. This is the starting point for setting up a new regulatory framework as well as the New Production Sharing Contracts (PSCs) which will include better terms and conditions than those of the existing Production Sharing contracts drafted in the 1970's and 1980's. New terms would reflect the overall Policy guideline embedded in the new regulatory framework. This is an achievement which shall endure in spite of the chaos in which the country is in. The new code has had a good review and it is quite likely that the new authorities will embrace it. New regulatory framework completed by end Dec-2010 Page 5 of 17

6 Ce d'ivoire obtains EITI validation No EITI reports initiated in Jan-2008 The EITI 2006 and 2007 reports have been completed and approved by the National EITI committee and posted on the websites of the MoF and EITI ( /www. cneiti.ci). Before the crisis, the authorities launched the recruitment of the new administrator to prepare the EITI 2009 and 2010 reports. This work has certainly be delayed Progress for the EITI validation has usually been difficult; going forward, this is an area that will need more attention from theauthorities. Reports for 2006 and 2007 received EITI validation 30-Jun-2010 Page 6 of 17

7 Percentage of parafiscal levies executed in the budget 0 percent in 2008 Before the crisis, all the resources allocated to the rural investment fund (FIMR) were executed through the budget and expenditures on health and education were managed by the corresponding ministries. These represented 28% of all parafiscal levies. Ater considerable discussion, it has been agreed that only investment levies need to be included in the budget. The FIMR levies represents the majority of these levies. 100 percent in 2012 Intermediate Results Indicators Page 7 of 17

8 Organized and participatory process of budget preparation PEFA Indicator : D in 2008 A large consultation of various stakeholders (lines ministries and decentralized communities) involved in the preparation of the budget took place in late October 2010 under the leadership of the Directorate of budget in the MoF. This consultation was conducted in close coordination with the PRSP Committee, so as to take into account priorities deriving from the PRSP. The PEFA rating has liked deteriorated due to the ongoing crisis and chaos in the country. This participatory process of budget preparation is likely to continue and even strengthened after the crisis given the incentive for HIPC completion and reengagement with the international community PEFA Indicator : C in 2012 Page 8 of 17

9 Rate of integrated plan execution (% of budget expenditures captured by SIGFIP 86 percent in 2008 (2207 data has been requested) Before the current political crisis, 95 (2012) the budget expenditures captured by SIGFIP increased to 89 percent in 2009 and expected to further increase in 2010 with the extension of SIGFIP to 10 more region departments and communes. With the ongoing war and instability, lot of budget expenditures is certainly done outside SIGFIP. Multi-year perspective in the budget planning and public expenditure policy PEFA indicator: D in 2008 The Government organized a PEFA indicator : C in 2012 workshop on Dec 8-9, 2009 to agree and adopt a methodology that will guide the preparation of the full MTEF for the 2011 budget law. Before the political crisis, an MTEF for 2011 budget was under preparation. Pilot ministries included:education, health, agriculture and rural development. All these efforts have certainly stopped They will be a strong incentive, when peace returns in the country, for the Government to quickly get on board with the MTEF agendaas this is a key recommendation of the new WAEMU directives Page 9 of 17

10 Rate of integrated capacity building plan execution (%) 0 percent in 2008 This activity has been executed 100%. The next PEFA exercise will provide the actual rate and will measure the performance of the audits and control functions. 22-Jun percent in 2012 The MEF website is operational No revision initiated in 2008 The website of the MoF (www. minecofin.gouv.ci) is completed and fully functional. Contracts have been signed for two additional websites in the Ministry in charge of mining and energy and the Ministry of agriculture. The latter were planned for completion in May 2010 but have experienced short delay in February due to the dissolving of the Government. They will be completed isoon as stabilityreturns. Budget information is published regularly on the Ministry of Economy and Finance website ( Updated websites have been completed and made operational 31-Dec-2009 Page 10 of 17

11 Rate of transposition of WAEMU guidelines and international standards in the national procurement regulatory framework (%) 80% (2008) This indicator was achieved % (2012) percent. National procurement regulations have been revised to include the new WAEMU regulations. Anew procurement code in line with WAEMU directives was adopted and a national public procurement regulatory authority created in October The Ministry of Economy and Finance is training key departments in priority ministries with technical assistance financed by the Governance and Institutional Development Grant. Training will be completed end- June The number of communes connected to the SIGFIP 37 communes in percent achieved. Ten new departments were connected in 2009 bringing the total to 59. Before the current poliical crisis, they were executing their budget through SIGFIP. We will be exploring ways to extend SIGFIP as well as the Public Accounting system (ASTER) in a few other departments and municipalities. 60 communes in 2012 (23 additional communes) Page 11 of 17

12 Competition, value for money and controls in procurement PEFA indicator : C in 2008 This activity was implemented 100 percent. The setting up of the national procurement regulatory authority (NPRA); separating the functions of execution and control in procurement and the training of staff of the procurement directorate and NPRA has contributed to that. Given the deterioration of public procurement during the current situation of war and politcal crisis, the progress made in this area has certainly been eroded. The next PEFA assessment will provide the actual rating, but this will not likely improve. PEFA indicator : B in 2012 Integrity and transparency of the procurement process (OECD/DAC methodology) 24 percent in 2008 This activity has not yet been launched, even before the current political crisis. It was expected to be launched in September 2010 This activity will be quickly launched once normal conditions return. 60 percent in 2012 Page 12 of 17

13 Amended/new legal, regulatory and contractual framework is updated and adopted No update initiated This activity was planned to be conducted after the validation of the hydrocarbon code and be completed in December Good quality work was done with regard to this new legal, regulatory, and contractual framework, which will need to be quickly adopted by the Government. New legal, regulatory and contractual framework is adopted Flexible and efficient fiscal system for upstream petroleum sector is adopted No revision of the fiscal system initiated This activity is expected to be one of the deliverables deriving from the adoption of the new hydrocarbon code. It was expected to be completed by The Government will likely endorse the new fiscal system for the upstream petroleum sector New fiscal system for upstream Petroleum adopted Page 13 of 17

14 Petroleum revenue forecast and variance analysis are carried out periodically (monthly, quarterly, and yearly) No tools for revenue forecast and analysis are in place The bidding was relaunched for the New tools are adopted and second time in June The implemented selection process for the winning bidder was not yet completed before the beginning of the current 31-Dec-2010 political crisis. This important activity shall quickly resume when the crisis is over Procedures for the transparent licensing of petroleum rights in line with good industry practice are in place No procedures are in place This activity is planned in 2011 as per the procurement plan. With the quick return of peace and stability, this activity can still be done as scheduled in 2011 Transparent procedures are adopted and implemented. 30-Jun-2011 The first EITI report is published No report initiated The 2006 and 2007 EITI reports Report for 2006 is completed and were completed and published published. online. 30-Oct-2009 Going forward, the challenge will to push for the achievement of the conformity status Page 14 of 17

15 Updated environmental regulations are adopted No revision of the regulatory framework initiated in 2008 This activity was completed in New regulatory framework adopted Jun-2010 Authorities also decided to carry out a Social and Environmental Assessment. A draft report was prepared in May 2010 by the firm and sent to the Bank for comment. Environmental management information system is in place No Environment Management Plan (EMP) in place The selection of the winning bidder was completed in May The contract has been signed with the firm. But the work will startafter the validation of the social and environmental assessment which will be used for setting up the environmental management information system. This activity will be quickly reviewed and relaunched soon after normal operations resume An EMP adopted nad implemented 31-Dec-2010 Percentage of non-complaince cases resolved in a reasonable timeframe is measured and used as benchmark for monitoring regulatory efficiency. No cases identified in 2008 This process will start as soon as the new Environmental Regulations are available and adopted. All non-complaince cases resolved in a reasonable timeframe in 2012 Page 15 of 17

16 of parafiscal levies in the cocoa sector CFAF/Kg in 2008 This target has been surpassed. The Government has reduced quasi-fiscal levies to CFAF26.26/ kg. The Government has also reduced cocoa taxes and committed to transforming the total taxation into an advalorem tax no more than 22% by October Jun-2010 Below CFAF/Kg in 2012 Standard deviation of data provided by the One-Stop shop, the Bourse du cafet du cacao (BCC) and the Customs CFAF 20 billion in 2008 With the restructuring of the cocoa sector and setting up of one management committee (CGFCC) this indicator is no longer appropriate. 09-Dec-2009 Less than CFAF 1 billion in 2012 Data on Financial Performance (as of 21-Feb-2011) Financial Agreement(s) Key s Project Loan No. Status Approval Signing Effectiveness Closing P IDA-H4010 Effective 12-Jun Jul Oct Dec-2012 Disbursements (in Millions) Project Loan No. Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P IDA-H4010 Effective XDR Disbursement Graph Page 16 of 17

17 Key Decisions Regarding Implementation Project rating has been downgraded to reflect negative impact on institutional governance and fiscal discipline resulting from the political turmoil and civil war that the country has been experiencing following the November 2011 presidential election. Restructuring History There has been no restructuring to date. Related Projects There are no related projects. Page 17 of 17