Document of The World Bank and African Development Bank FOR OFFICIAL USE ONLY Report No: 72140-GM INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL FINANCE COOPERATION AND AFRICAN DEVELOPMENT BANK SECOND JOINT PARTNERSHIP STRATEGY FOR THE REPUBLIC OF THE GAMBIA FOR FISCAL YEARS 2013-2016 March 11, 2013 International Development Association Country Department AFCF1 Africa Region International Finance Corporation Africa Region African Development Bank Regional Department, West 2, ORWB This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. The date of the previous IDA-AfDB Joint Partnership Strategy for The Gambia (Report No. 42267 – GM) was February 1, 2008. CURRENCY EQUIVALENTS (as of 31 August 2012) Currency Unit: Gambian Delassi (GMD) 1 UA= 1 SDR = 49.86 GMD 1 UA = 1 SDR = US$1.522 1 US $ = 32.25 GMD WEIGHTS AND MEASURES Metric System FISCAL YEAR 01 January – 31 December ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory Activities ACE Africa Coast to Europe ADF African Development Fund AfDB African Development Bank APRC Alliance for Patriotic Reorientation and Construction ASPA Agribusiness Services and Producers’ Association AU African Union AWF African Wildlife Foundation BADEA Banque Arable pour le Développement Economique de l’Afrique (Arab Bank for Economic Development of Africa) BEIA Biomass Energy Initiative for Africa CBEMP Capacity Building Economic Management Project CDD Community Driven Development CERF Central Emergency Response Fund CFAA Country Financial Accountability Assessment CPAR Country Procurement Assessment Report CPIA Country Policy and Institutional Assessment CPIP Country Program Implementation Plan CSO Civil Society Organization CY Calendar Year DFID Department for International Development (UK) ECF Extended Credit Facility ECOWAS Economic Community of West African States EFA FTI Education for All Fast Track Initiative, now: Global Partnership for Education ESW Economic and Sector Work EU European Union FAO Food and Agriculture Organization FDI Foreign Direct Investment FIRST Financial Sector Reform and Strengthening FY Fiscal Year GAFSP Global Agriculture and Food Security Program ii GAMTEL Gambia Telecommunications GAVI Global Alliance for Vaccines and Immunization GBOS Gambia Bureau of Statistics GCP Growth and Competiveness Project GDP Gross Domestic Product GEF Global Environment Facility GER Gross Enrollment Rate/Ratio GIEPA Gambia Investment and Export Promotion Agency GGC Gambia Groundnut Corporation GMD Gambian Dalasi GNI Gross National Income GPE Global Partnership for Education GPPA Gambia Public Procurement Act GRA Gambia Revenue Authority HIPC Highly Indebted Poor Country HPS Hand Picked Selected HIV/AIDS Human Immunodeficiency Virus/ Acquired Immunodeficiency Syndrome ICT Information Communication Technology IDA International Development Association IDB Islamic Development Bank IDF Institutional Development Fund IEG Independent Evaluation Group IfAD Institute for Agricultural Development IFC International Finance Corporation IFMIS Integrated Financial Management Information System ISPEFG Institutional Support for Economic and Financial Governance IHS Integrated Household Survey IMF International Monetary Fund ITC International Trade Center JPS Joint Partnership Strategy JSAN Joint Staff Advisory Note JSDF Japan Social Development Fund LPI Logistics Performance Index MCHN Maternal and Child Health and Nutrition MMR Maternal Mortality Rate MDG Millennium Development Goal MDRI Multilateral Debt Reduction Initiative MIGA Multilateral Invest Guarantee Agency MFEA Ministry of Finance and Economic Affairs MoBSE Ministry of Basic and Secondary Education M&E Monitoring and Evaluation NaNA National Nutrition Agency NAT National Assessment Test NAWEC National Water and Electricity Company NGO Non-governmental Organization NPC National Planning Commission ODA Official Development Assistance OECD Organization for Economic Co-operation and Development OMVG Organisation Mise en Valeur Fleuve Gambie (Gambia River Basin Development Organization) iii OPEC Organization of Petroleum Exporting Countries PAGE Program for Accelerated Growth and Competitiveness PCU Project Coordination Unit PFF Project Preparation Facility PMO Personal Management Office PHC Primary Health Care PPIAF Public Private Infrastructure Facility PPP Public Private Partnerships PRSP Poverty Reduction Strategy Paper PURA Public Utilities Regulatory Authority RBF Results Based Financing RISP Regional Infrastructure Strategy Paper RSR Rapid Social Response RWSSI Rural Water Supply and Sanitation Initiative SDR Special Drawing Rights TF Trust Fund TFSCB Trust Fund for Statistical Capacity Building TVET Technical and Vocational Education and Training UA Units of Account UNDP United Nations Development Program UNICEF United Nations Children’s Fund UK United Kingdom VAT Value-added Tax WAAPP West Africa Agricultural Productivity Program WAEMU West African Economic and Monitory Union WARCIP West Africa Regional Communications Infrastructure Project WBI World Bank Institute WBG World Bank Group WFP World Food Program WHO World Health Organization International Development Association Vice President Makhtar Diop Country Director Vera Songwe Task Team Leader Barbara Weber International Finance Cooperation Executive Vice President Jin-Yong Cai Country Director Yolande Duhem Principle Country Officer Jerome Cretegny African Development Bank Vice President Zondo Sakala Regional Director Franck Perrault Task Team Leader Jamal Zayid iv THE REPUBLIC OF THE GAMBIA EXECUTIVE SUMMARY........................................................................................................ viii I. INTRODUCTION ................................................................................................................. 1 II. COUNTRY CONTEXT ........................................................................................................ 1 1.1 Economic Developments ........................................................................................................................ 1 1.2 Political and Governance Context ....................................................................................................... 6 1.3 Social Context ............................................................................................................................................ 7 1.4 Poverty Profile and Trends .................................................................................................................... 8 1.5 Major Development Challenges ........................................................................................................... 8 1.6 The Gambia’s Development Strategy and Priorities .................................................................. 12 III. THE AfDB AND WBG SECOND JOINT PARTNERSHIP STRATEGY.................... 13 2.1 Lessons from the Previous Joint Assistance Strategy (JAS), Stakeholder Feedback and Gender Assessment ............................................................................................................................................ 13 2.2 The Portfolios of Both Banks ............................................................................................................ 14 2.3 The JPS-2 Strategic Approach ........................................................................................................... 16 2.4 Implementing the Second AfDB / WBG JPS ............................................................................... 24 IV. MANAGING RISKS ........................................................................................................... 28 3.1. Governance Risks .................................................................................................................................. 28 3.2 Macroeconomic Risks .......................................................................................................................... 29 3.3 Program Implementation and Fiduciary Risks ............................................................................. 29 List of Tables: Table 1: Gross Domestic Product at Basic Prices / Factor Cost ...................................................... 2 Table 2: Central Government Fiscal Operations, 2007-2015 .......................................................... 3 Table 3: Central Government Fiscal Operations, 2007-2015 .......................................................... 5 Table 4: Summary of PRSP Budget Allocations and Outturns, January-December 2011 .............. 7 Table 5: Current Active WB Lending Portfolio in The Gambia ................................................... 15 Table 6: Current Active AfDB Lending Portfolio in The Gambia ................................................ 15 Table 7: Indicative Lending Program for AfDB/WB .................................................................... 25 Table 8: Combined Donor Support to the Gambia Education Sector............................................ 27 Table 9: Adaptation Measures to Reduce the Impact of Climate Change in some Sectors in The Gambia ........................................................................................................................................... 68 Table 10: Proposed Programs/Projects for the Bank’s Intervention.............................................. 69 List of Boxes Box 1: The Effects of Climate Change in the Gambia .................................................................... 4 Box 2: Innovations in the Education Sector. ................................................................................. 10 Box 3: Policy and Legal Framework for Gender Equity ............................................................... 12 v List of Annexes Annex 1: JPS-2 Results Framework .............................................................................................. 31 Annex 2: Overview on Full Proposed AfDB-IDA JPS-2 Program by Pillars ............................... 35 Annex 3: JAS Completion Report – FY08-11 ............................................................................... 36 Annex 4: The Gambia Country Climate Fact Sheet ...................................................................... 66 Annex 5: A2-The Gambia at a Glance........................................................................................... 70 Annex 6: Gambia MDG Progress .................................................................................................. 73 Annex 7: B2 - Selected Indicators* of Bank Portfolio Performance and Management ................ 75 Annex 8: IBRD/IDA Program Summary....................................................................................... 76 Annex 9: IFC Program................................................................................................................... 77 Annex 10: B4-Summary of Non-Lending Services ....................................................................... 78 Annex 11: B6-Key Economic Indicators ....................................................................................... 79 Annex 12: B7-Key Exposure Indicators ........................................................................................ 81 Annex 13: B8-Operations Portfolio ............................................................................................... 82 Endnotes 83 vi ACKNOWLEDGEMENTS The World Bank Group (WBG) and the African Development Bank (AfDB) greatly appreciate the close and fruitful collaboration with the Government of The Gambia in the preparation of this Joint Partnership Strategy. The preparation of the JPS document was a team effort by both organizations’ country teams for The Gambia. Many team members made substantial contributions by drafting parts of the document, participating in review meetings and providing comments and advice. Special thanks go to Annette De Kleine Feige, World Bank Senior Economist for The Gambia, for her tremendous support during the finalization phase of this document, Rory O’Sullivan, Consultant, who helped in the initial stages of the document preparation, Victor Wahba, Consultant, who elaborated the JAS-1 Completion Report, Upulee Dasanayake, Consultant/Operations Analyst, for her patience in updating the document and her detailed editorial support, and Anta Loum Lo for editing and finalizing the Board package. Last but not least, special thanks to Badara Joof, World Bank Liaison Officer in Banjul, for his extremely valuable support in facilitating multi-stakeholder consultations and dialogue with Government authorities throughout the full process of strategy preparation. vii EXECUTIVE SUMMARY i. The Gambia has had strong economic performance in recent years with average annual real GDP growth of 6-7 percent during 2008-2010. But it has since dropped to 3.5 - 4 percent in 2012. Effects of the global financial crisis of 2008 were tempered by good agricultural outputs in the same period, and by increased tourism receipts. Overall poverty rates declined from 58 percent in 2003 to 48.4 percent in 2010, and education coverage and quality improved. Progress was made in the areas of public sector, economic and fiscal management, civil service and justice reform, anti-corruption and public procurement reform. Recent data show modest developments in health, notably on HIV/AIDS prevalence (which remains stable) and maternal mortality (which declined considerably). The Government is committed to consolidating these achievements while creating space for continued funding of poverty reduction programs. ii. As a small, open economy, however, The Gambia remains highly vulnerable to external shocks, given its relatively undiversified economic base. The Gambia is heavily dependent on rain-fed crops for agricultural production, on imports for food security, and on tourism receipts and remittances for foreign exchange earnings. The 2011-2012 Sahelian drought crisis caused massive crop losses, with related impacts on household food security and nutrition, the availability of seeds, and the balance of payments. GDP growth slowed to -4.3 percent in 2011 (compared to 5.5 percent in 2010). And Gambian transit and re-export trade activity has been hampered by gains in competitiveness in neighboring countries, specifically Senegal, and the impacts of the most recent crises in Mali and Guinea-Bissau. Finally, the country’s vulnerability to climate change, land degradation and disaster risk explicitly highlights the need to promote and strengthen integrated management of the coastal zone and to protect and preserve biological diversity and ecological assets. iii. The Gambia faces three main challenges: a. Restoring growth and macroeconomic stability. This will require diversification of the economy and an improved private sector investment climate. b. Improving service delivery, through effective civil service reform including improved management capacity for strategic planning, performance measurement, and institutional coordination, collaboration and dialogue. c. Improving transparency and accountability in public financial management and public procurement. In particular, improving the demand side of public financial management by disseminating information to the public and creating a culture of accountability and citizen participation. iv. The second AfDB/WB Joint Partnership Strategy (JPS-2) for the 2013-16 period, in support of the Government’s 2012-15 Program for Accelerated Growth and Employment (PAGE)1 proposes to respond to these challenges by concentrating on two main pillars: Pillar 1: Enhancing Productive Capacity and Competitiveness in order to strengthen resilience to External Shocks. This pillar is aligned with elements of PAGE pillars I (Economic Growth), II (Infrastructure) and IV (Governance). viii Pillar 2: Strengthening the Institutional Capacity for Economic Governance and Public Service Delivery is aligned with elements of PAGE pillars III (Human Capital, Social Services), IV (Governance) and V (Social Cohesion, Cross-cutting interventions). The AfDB will focus on economic governance and agriculture, while the World Bank Group (WBG) will, in addition to these, focus on infrastructure, i.e. the energy sector and internet connectivity, human development, and private sector development. v. This Joint Strategy has been prepared and will be implemented jointly by the AfDB and the WBG to better harmonize the two institutions’ assistance to The Gambia in line with the 2011 Busan Declaration on Aid Effectiveness. The Completion Report of the first Joint Assistance Strategy (JAS, 2008-11) concluded that this collaborative approach was successful in improving the impact of the development efforts by the two institutions – allowing them to align their development programs, avoid duplication of efforts, and combine their technical expertise. To this end, the WBG and the AfDB have been working together to develop shared objectives and a common platform for lending and non-lending activities during the coming JPS period. vi. Over the four year JPS period, about US$90 million in lending, supplemented by trust fund (TF) resources, will be available to support The Gambia’s PAGE. This support will be complemented by analytical work and other non-lending activities. The program design is currently based on the assumption of (a) a three-year (2012-14) African Development Fund (ADF) resource allocation for new commitments of UA3 million (equivalent to US$4.5 million) from ADF 12 available for 2012 and 2013; (b) UA 8 million (equivalent to US$12 million) from ADF 13 available for 2014 and 2015; and (c) an indicative IDA-16 allocation of SDR29.8 million (equivalent to US$44.7 million) followed by estimated IDA-17 annual allocations of about US$14 million, supplemented by TF resources. vii. The proposed JPS-2 also takes into account the complementary efforts of other donors. As part of the program, both institutions will seek to strengthen their communication with other donors and help the Government improve donor coordination in the country. viii. Risks: The proposed program carries risks. The overall country risks are vulnerability to exogenous shocks and governance-related risks, notably with respect to accountability and transparency in the management of public resources. Major policy reversals and other unexpected decisions, such as the President’s temporary introduction in late October 2012 of a fixed exchange rate peg of the GMD to the US dollar is a cause of concern. The temporary lifting of the moratorium on capital punishment with the executions of nine death row inmates in August 2012, and the most recent introduction of a four-day work week for the public service represent challenges for the Government’s dialogue with internal and external stakeholders. Those actions have reduced confidence in the Government’s commitment to its international agreements. These risks will be closely monitored by both Banks and their impacts on the joint program mitigated by continued strong collaboration with the International Monetary Fund (IMF), the EU, and other donors on macro-economic management, program design and implementation support. ix I. INTRODUCTION 1. The Gambia is the smallest country on the African mainland. Its stretches 450 km along the Gambia River. Its 11,285 sq. km area is surrounded by Senegal, except for a 60 km Atlantic Ocean front. Although small in size, The Gambia harbors a wealth of land, coastal, marine and wetland habitats and species of local, national, regional and global significance, making Gambia an attractive tourist destination and, due to is unique geographic location, a hub for trade in the region. 2. The country has a population of 1.8 million and a Diaspora of around 0.5 million. The current population has been growing at a fairly high rate of 2.8 percent per year over the last decade. Life expectancy at birth for the average Gambian is 58 years and 60 percent of the population is under 25 years of age. Most of the population (57 percent) is concentrated around urban and peri-urban centers. The main languages are English, Mandinka, Wolof, Jola and Fula, and 90 percent of Gambians are Muslim. The Gambia has maintained a reputation of relative stability and peace, although its sub-region has been marked by recurring instability and conflict. The incumbent President 2 Yahya A.J.J. Jammeh was re-elected for a fourth term on November 24, 2011, receiving 72 percent of the popular vote. 3. The Gambia is facing serious challenges in achieving most of the Millennium Development Goals (MDGs). According to the World Development Indicators database, the poverty reduction goal at the poverty line of US$1.25 has been achieved. In terms of human development, The Gambia has achieved the MDGs related to gender parity in primary and secondary education, and to improved access to water sources. Progress towards all other MDGs is off-target. The MDGs related to primary school completion rates (even though considerable progress has been made), infant and child mortality, measles vaccination and births not attended by skilled staff are seriously off-target, and will not be reached any time soon if current policies are continued and donor support is maintained at current levels (Annex 6). 4. Regional integration and cooperation are extremely important for The Gambia, due to its limited surface area, population size and markets, and its geographical position as a semi-enclave into Senegalese territory. Any developments affecting the sub-region, specifically Senegal, affect the country’s growth prospects, the sustainability of its natural resource basis, and its political stability. The Gambia is a member of regional bodies such as the Economic Community of West African States (ECOWAS), and the Gambia River Basin Development Organization (OMVG). Based on its historic linkages to Great Britain, the Gambia is also a member of the (British) Commonwealth. Given its location, The Gambia will need to collaborate closely with Senegal to overcome two major hurdles that might hamper its integration in the sub region, namely the quality of Senegalese roads and the willingness of Senegalese authorities to facilitate transit trade. II. COUNTRY CONTEXT 1.1 Economic Developments 5. The Gambia’s average per capita GDP was US$610 in 2011 (Atlas Method). GDP composition by sector is depicted in Table 1 below for 2005-2012 The composition though stable can shift somewhat, due to variations in crop production, but the broad proportions highlight the importance of the agriculture and trade (including tourism) sectors, and weak manufacturing activity. 1 6. The Gambia benefitted Table 1: Gross Domestic Product at Basic Prices / Factor Cost from considerable multilateral Percentage share of total GDP debt relief after reaching the 2005- 2011 2012e HIPC Completion Point in 10 December 2007. With HIPC Agriculture, forestry, fishing & hunting Mining and quarrying 25.0 2.3 25.2 2.6 20.3 2.9 completion, the country also Manufacturing 6.1 5.1 5.4 became eligible for debt relief Electricity, gas and water 1.1 1.2 1.3 from the IMF, IDA, and the Construction 3.9 3.7 4.0 Wholesale and retail trade, hotels and restaurants 27.9 24.5 26.0 African Development Fund Transport, storage and communication 12.3 14.4 15.8 (ADF) under the Multilateral Finance, real estate and business services 10.9 10.7 11.5 Debt Relief Initiative (MDRI). Public administration, education, health 1.9 1.9 2.0 Other services 2.8 3.1 3.4 Total debt service savings under Gross domestic product at basic prices / factor cost 100.0 100.0 100.0 the MDRI will amount to Source: AfDB Statistics Department; National Authorities. approximately US$373.5 million in nominal terms until 2050. The total estimated nominal debt relief under both the Enhanced HIPC Initiative and the MDRI, on principal as well as interest payments is equivalent to about US$514 million. 7. Fiscal discipline slipped in 2009 and 2010, but has since improved. The deterioration was partly due to the unstable global environment and declining tourism receipts. But it also reflected an increase in tax exemptions on imports, and delays in adjusting the pump prices for petroleum products. In 2011, the Government generated a basic primary fiscal surplus3 estimated at 1.2 percent of GDP which is projected to rise to 1.6 percent in 2012, up from minus 0.4 percent in 2010. This has helped to contain the Government’s net domestic borrowing. It also helped clear the Government’s overdraft with the Central Bank and, with that, marked an end to the Central Bank financing of the deficit (see Table 2, below). 8. Prudent fiscal management is particularly important given the country’s relatively high public debt to GDP ratio, with low maturity levels for domestic debt. Foreign and domestic public debt remains high, notwithstanding the country having reached the HIPC/MDRI completion point at end 2007. The key exposure indicators of the IMF and WB show that total debt outstanding as a ratio to GDP declined from 143.2 percent in 2006 (pre-HIPC) to 55.1 percent in 2008. However, it increased again to 68.4 percent in 2011, reflecting the combination of a fast-growing, high-cost, domestic public debt (29 percent of GDP), and a slow-growing, mostly concessional external public debt (39 percent of GDP). Thanks to improvements in its Country Policy and Institutional Assessment (CPIA) rating, The Gambia has been upgraded to a medium performer, with higher policy thresholds for the assessment of the sustainability of its debt. There is now some scope for the government to borrow on non-concessional terms. This and the inclusion of re-exports have resulted in a decrease in the risk of debt distress, from high debt distress to medium in 2012. However, near and medium-term external debt sustainability remains vulnerable to adverse shocks, and domestic debt is costly and poses high rollover risks. Further, it is important to note that active debt management – with a view to minimizing budgetary risks and ensuring long-term debt sustainability - is one of the criteria for the determination of the IDA and ADF Resource Allocation Indicators (RAI). 2 Table 2: Central Government Fiscal Operations, 2007-2015 Table 2.1: Central Government Fiscal Operations, 2007-2015 (% of GDP) 2007 2008 2009 2010 2011 2012e 2013p 2014p 2015p Revenue 18.3 17.2 20.3 18.9 19.6 22.6 22.4 22.6 22.7 Taxes 15.2 14.5 14.6 13.2 13.2 14.0 15.2 15.4 15.4 Non-tax revenues 2.2 1.6 1.5 1.6 1.7 1.8 1.8 1.9 1.9 Grants 1.0 1.1 4.2 4.0 4.7 6.7 5.4 5.4 5.5 Expenditures 17.9 18.6 23.0 24.3 24.0 26.5 24.9 24.7 24.7 Current expenditures 13.0 14.6 15.0 15.2 16.0 16.9 15.0 14.6 14.0 Interest payments 4.1 3.3 3.1 2.9 3.4 3.7 3.5 3.1 2.8 Subsidies 2.2 2.1 2.0 2.1 2.3 2.1 1.9 2.0 1.9 Capital expenditures 4.9 3.9 8.0 9.0 8.0 9.6 9.8 10.1 10.8 Net lending (+)/borrowing (–) 0.4 -1.4 -2.6 -5.4 -4.4 -3.9 -2.5 -2.1 -2.0 Gross fiscal balance 0.4 -1.4 -2.6 -5.4 -4.4 -3.9 -2.5 -2.1 -2.0 Basic balance1 2.9 -0.6 -1.9 -3.3 -2.2 -2.1 -0.1 0.3 0.3 Basic primary balance2 7.0 2.7 1.2 -0.4 1.2 1.6 3.4 3.4 3.0 Domestic public debt3 22.8 21.0 21.1 29.4 30.4 31.8 28.6 25.5 23.2 Sources: Gambian authorities and International Monetary Fund staff estimates and projections. 1 Overall balance, excluding statistical discrepancy, less expenditures financed by project grants and external borrowing. 2 Basic balance, excluding interest payments. 3 Defined as gross domestic interest bearing debt. 9. Large fiscal deficits in recent years have forced the Government to resort to borrowing from the domestic market where interest rates are high. Interest on foreign and domestic debt in 2011 accounted for an estimated 22.5 percent of public revenues with 18.5 percent of revenues absorbed by domestic debt service alone. While the real yield on the total public debt is relatively low (averaging less than 5 percent), this average conceals the very high average interest rates on the domestic public debt (just under 9 percent). There is a significant domestic debt refinancing exposure.4 The average time to maturity of the external debt is 14.5 years, whereas the average time to maturity of the stock of domestic debt is less than one year. As a result, the servicing of domestic public debt has crowded out private sector borrowing by putting upward pressure on domestic interest rates. This has also reduced the available revenues for development spending. The Government is currently implementing a fiscal adjustment program aimed at reducing the net domestic borrowing to 0.5 percent of GDP by 2014. 10. As part of the fiscal consolidation effort, a comprehensive tax reform program is being envisaged to help stabilize revenues. Actions are being taken to set limits on how tax exemptions are being awarded, to strengthen tax administration and to raise tax payer awareness of the application of tax laws and the coverage of the value-added tax (VAT). These actions will be further strengthened by the establishment and institutionalization of the Tax Tribunal. Better and more frequent human resources planning for payroll management and control given the increase in the civil service over the last few years is under consideration. The validation of the Human Resource records in the Integrated Financial Management Information System (IFMIS) payroll module envisioned under the proposed grant would allow for the regularization of these records, with the removal of ghost workers and the elimination of vacant positions. This will, in effect, strengthen the base for a more judicious management of the personnel records, including the inclusion of new entrants into the payroll, under the auspices of the Personnel Management Office. These actions will further safeguard the acceptable macroeconomic framework achieved in 2011. 3 11. The IMF-supported Extended Credit Facility (ECF) program includes additional initiatives to maintain and enhance the country’s current fiscal discipline. Actions under the ECF program to increase tax revenue collection include the closer alignment of domestic fuel prices with international prices in 2012, and the introduction of the VAT in 2013. These and other actions will help to reduce annual domestic financing needs and create fiscal space for the implementation of the Program for Accelerated Growth and Employment (PAGE). 12. The IMF postponed its First Review of the Extended Credit Facility from late-2012 until early-2013, due to uncertainties about monetary policy implementation following the President of Gambia’s decree in October 2012 that introduced a fixed exchange rate peg and controls on US-dollar shipments. The controls on shipments were subsequently lifted within a week of the decree’s announcement and the exchange rate peg was lifted in November 2012 with the reintroduction of a market determined floating exchange rate. The IMF conducted a mission in December 2012 to assess the impact of the monetary policy shifts, and determined that exchange rate activity had largely returned to normal and that uncertainty pertaining to the recent policy shifts had diminished substantially. Nevertheless, market confidence in the Government’s commitment to the stated exchange rate policy has been eroded. Confidence can only be regained over time by the Central Bank's ongoing commitment to the market determined exchange rate policy complemented by the gradual accumulation of international reserves to support macroeconomic stability. The IMF is finalizing the First Review of the ECF for Board Review. An Article IV mission is planned following the IMF-WB 2013 Spring Meetings, and the Second Review of the ECF is envisaged in fall 2013. 13. The country remains highly vulnerable to external Box 1: The Effects of Climate Change in the Gambia shocks, as key sources of foreign The Gambia is one of the most vulnerable countries in Africa to the exchange earnings were hit hard adverse impacts of climate change. With approximately 50% of the by the global financial crisis: In total land area being less than 20m above sea level, and about 33% of aggregate, net receipts for travel the country below 10m above sea level, any significant global warming-induced sea level rise could submerge much of the country. services (tourism), worker Currently, about 20% of the country is flooded annually and the remittances and foreign direct mangrove ecosystems are already affected by saline intrusion as well investment (FDI) have declined as flooding. markedly to an estimated one-fifth Linear trends indicate that wet season rainfall in The Gambia has of GDP (20 percent) in 2011 from decreased significantly between 1960 and 2006, at an average rate of more than one-fourth of GDP in 8.8mm per month per decade. Projected annual change ranges from � 2007 (27 percent) and nearly one- 23 to +18% by the 2090s, with increasing occurrence of heavy rainfall events. third in 2006 (31 percent). Aside Global warming and associated impacts of climate change, as well as from providing valuable foreign projected extreme weather and climatic events will compound efforts exchange earnings, these inflows to address the development challenges of the country in the face of buoy activity in the domestic rapid population growth: The country’s First National Communication economy through various linkages; projected that about 92 sq. km of land in the coastal zone will be worker remittances and FDI, for inundated as result of 1m sea level rise. Accordingly, the whole of the capital city of Banjul will be lost due to the fact that the greater part of example, provide significant the city is below 1m. The report also predicts negative effects of support to domestic private projected climate change on crop production, biodiversity and wildlife, consumption and investment, coastal resources, forestry etc. Effective adaptation to climate change respectively. While the level of net and its mainstreaming into national development is a pre-condition for tourism receipts are estimated to sustainable development. have recovered to the pre-crisis 4 (2007) level of US$84 million in 2011, tourism, as a share of GDP, reached only 8.6 percent in 2011 compared with 10.5 percent in 2007 (Table 3). Table 3: Central Government Fiscal Operations, 2007-2015 Percent shares of GDP (nominal) 2004 2005 2006 2007 2008 2009 2010 2011e Worker Remittances 9.0 7.6 7.9 6.5 5.5 4.7 4.7 4.9 Foreign Direct Investment 9.8 9.7 11.3 10.1 7.2 8.1 8.9 6.1 Exports of travel services 9.2 10.7 11.5 10.5 8.5 8.2 7.4 8.6 Memo: Aggregate 28.0 28.0 30.7 27.1 21.1 21.0 20.9 19.6 14. The Gambia is also vulnerable as a result of its heavy reliance on rain-fed agriculture, which has led to wide variability in agricultural activity. The severe drought in 2011 and concomitant 60 percent drop in crop production and depletion of seed stores are cases in point. Notably, with favorable weather conditions, the agriculture sector witnessed substantial growth in the years5 before the 2011 Sahelian drought which had buoyed domestic consumer demand and, with that, more than offset the negative impacts of the global economic crisis during 2008 through 2010. The sector is characterized by subsistence production of rain-fed crops (such as coarse grains, rice, etc.) and semi-intensive cash crop production (groundnuts and vegetables). Groundnuts are the most important agricultural export, accounting for 60 percent of domestic exports. 15. Food security in The Gambia is strongly dependent on imports. Cereal imports account for 50-60 percent of consumption needs and the average Gambian spends more than 60 percent of his/her income on food in a normal year. The rising food prices since 2007 began on the heels of locust invasion and a series of droughts that affected both cereals and cash crop (groundnut) production. In light of rising prices of cereal crops many Gambians have faced serious hardships in terms of household food security. 16. The Gambia’s coastal and marine areas, where a large proportion of the country’s population resides, are under increasing pressure. Population growth and in-migration as a result of disrupted rainfall patterns and land degradation in the hinterland translate into growing pressure on coastal and marine resources, including from sand mining, fishing, and clearing of forest and mangroves for use as domestic fuel. There is also evidence of significant pressure on species of global and regional concern6. With the further destruction of coastal areas, one of the country’s primary tourism attractions might be compromised, and with it, one of its major sources of revenues. 5 1.2 Political and Governance Context 17. The Gambia is a presidential republic with a unicameral legislature. The incumbent President7 Yahya A.J.J. Jammeh, who originally took office in a bloodless coup in 1994, was re- elected for a fourth term, with 72 percent of the vote, on November 24, 2011. Parliamentary elections took place on March 29, 2012, with the President’s party (the Alliance for Patriotic Reorientation and Construction, or APRC) maintaining its sizeable majority, with 43 seats in the 53-seat National Assembly. 8 Most opposition parties boycotted the elections due to concerns related to the timing and context of the elections, and to what they perceived as an absence of a level playing field for competition in the election process. 9 Women continue to be under- represented at all political levels. 18. Progress has been made in selected areas of governance. In the face of still pervasive corruption 10 , the Government is in the process of establishing an Anti-Corruption Agency to coordinate and consolidate integrity activities within the public sector. Since the early 2000s, the country’s public procurement system has undergone substantial reforms 11 and there has been moderate progress in the field of justice.12 19. While economic governance has been improving, political governance indicators have declined 13 , and recent major policy reversals have undermined confidence in the Government’s commitment to its international agreements. For example, The Gambia’s August 2012 executions of nine death row inmates, including two Senegalese nationals, in breach of the Geneva Conventions and Cotonou Agreement, have unfavorably affected its relations with Senegal - even though the moratorium on capital punishment has been re-instated one month later. Another example is the President’s temporary introduction in late October 2012 of an ad- hoc fixed exchange rate peg that risked the overall macro-framework and diminished confidence in The Gambia’s commitment to the ECF arrangement signed with the IMF earlier in 2012. 20. The 2012 Mo Ibrahim Index of African Governance ranks The Gambia in the middle of the countries of the continent. The Gambia scores 51.6 (out of 100) for governance quality – slightly lower than the regional average for West Africa of 51.9 - and is ranked 27th out of 52 countries. The Gambia ranks relatively well among its West African peers on the 2011 Global Gender Gap Index, at 77 (out of 135), ahead of neighboring Senegal (rank 92) and Mauritania (rank 114). The Freedom in the World 2012 report categorizes The Gambia as “not free�. Internal governance issues have had an unfavorable impact on economic development by, at times, compromising relations with neighboring countries, development partners, and internal stakeholder groups. Poor governance also undermines urgently needed private sector investments due to concerns related to corruption, political interference and the rule of law. 21. Weak public sector capacity remains a significant constraint. The Government recently launched a new Civil Service Reform Strategy (2012-2015) building on previous initiatives. The strategy comprises seven components dealing with broad areas of public sector performance, pay and pension reforms, accountability and service delivery. Earlier activities, supported by UNDP and Spain, have improved capacity in public sector management and e- governance, the justice sector, and the National Assembly14. 6 1.3 Social Context 22. The Gambia ranks 168th out of 187 on the 2011 Human Development Index and will not achieve most of the MDGs (Annex 6). Some gains have been recorded in education, health and nutrition in recent years; however, many challenges remain. 23. The Government made commendable progress with respect to education coverage, and quality has started to improve as well. The Gross Enrollment Rate (GER) for lower basic education increased considerably in the last few years and reached 90 percent in 2012 (including the certified madrassas which follow the regular curriculum) which is at par with the SSA average. Gender parity has been achieved at both the lower basic and upper basic levels. With a primary completion rate of 72 percent, The Gambia compares well with other countries and, if it accelerates efforts to improve the quality of education, might be able to attain universal primary completion by 2020. 24. Progress in health indicators has been less consistent and The Gambia is unlikely to achieve any of the health-related MDGs: This includes maternal as well as infant and under- five child mortality rates and the percentage of births not assisted by skilled staff. The under-five child mortality is 106 in the Gambia, compared to 77 in Senegal. As to projections based on progress in the past five years, the MDG targets for infant and under-five child mortality will be reached only towards the end of the century or in the 2030s, respectively, if current policies continue to be implemented as they were in the most recent past - and/or donor support is maintained at the current levels. Earlier progress in reducing malnutrition has stalled in recent years: According to the new World Health Organization (WHO) standards, stunting increased between 2000 and 2005 from 24 to 28 percent, but fell to 23 percent in 201015. Projections on the MDG target related to undernourishment show insufficient progress, reflecting, amongst others, the impact of the 2011 drought. 25. The latest sero-surveillance data indicate that the HIV-1 prevalence rate is stable and not significantly improving. With a prevalence rate of 0.9 percent amongst adults aged 15 to 49, according to UNAIDS estimates for 200716, it is at a very low level for Sub-Saharan Africa17. 26. Though well executed, the poverty programs are primarily contingent on continued donor support. The budget execution rate of social programs in 2011 was 96.5 percent (see Table 4). The highest rates were recorded for education, health and nutrition programs, which reached percentages in the upper 90s. However, most of the program budgets went to wages and salaries. Table 4: Summary of PRSP Budget Allocations and Outturns, January-December 2011 Share of PRSP Jan.-Dec. outturn as a Jan.-Dec. Budget expenditures percentage of overall PRSP Entity outturn Allocation allocated to the GLF allocations entity (percent) (percent) Basic and Secondary Education 618.2 27.9 615.7 99.6 Health and Social Welfare 446.1 20.2 431.4 96.7 Agriculture 213.4 9.6 194.4 91.1 Overall PRSP Expenditures 2213.8 100.0 2137.4 96.5 Source: IFMIS. 7 1.4 Poverty Profile and Trends 27. Poverty noticeably declined during the last decade, but remains widespread with considerable regional variation. The overall poverty rate was an estimated 48.4 percent 18 in 2010, down from an estimated 58.0 percent in 2003.19 While there are problems of comparability, this suggests a fairly high elasticity of poverty with respect to growth and therefore a relatively inclusive pattern of growth. This is broadly consistent with the important role played by agriculture during this period. 28. There are large regional variations of poverty within The Gambia, with urban areas recording (based on the upper poverty line) a much lower poverty headcount (32.7 percent) compared with rural areas (73.9 percent). However, there appears to have been a modest narrowing of the gap, with poverty actually increasing in the Banjul area, probably due to rapid migration from rural areas. At the same time, the poorest region, Central River Region-North, enjoyed the largest decline in poverty between 2003 and 2010, although 79 percent of its population remains poor. Inequality appears to be somewhat higher than in neighboring Senegal20. 29. The extreme poverty rate for female-headed households is significantly lower than for male headed households – 38 as compared to 51 percent. Factors explaining these figures include the fact that bigger households, which are most often headed by males, are generally poorer than those with fewer members. Also, female-headed households are mostly found in the urban areas, with household heads more often than not gainfully employed. Remittances from abroad continue to play a significant role in these households. However, the female labor force21 is predominantly rural, and less-skilled, and earns less income than male workers. 30. The unemployed in The Gambia are more likely to be young, urban, female, and better educated – reflecting the weakness of the country’s formal economy. 22 Nearly 60 percent of the poor in The Gambia are under the age of 20. Youth face significant challenges with respect to employment outcomes, such as very difficult transition from school to work and very low levels of education and training. Rural unemployment rates are low and vary little across the whole age spectrum, predominantly as a result of rural workers being absorbed into low pay, low qualification, high informality and low quality jobs in the agriculture sector. In cities and towns, the services sector is the most important source of employment, particularly for young people, accounting for almost 65 percent of employed youth aged 20-24 years. 1.5 Major Development Challenges 31. The Gambia faces three main challenges that need to be addressed to increase resilience, and allow for more adequate responses to external shocks, including volatile weather conditions and the effects of climate change:  Restoring growth and macroeconomic stability. This will require in particular diversification of the economy and an improved private sector investment climate.  Improving service delivery. This will require effective civil service reform including improved management capacity for strategic planning, performance measurement, and institutional coordination, collaboration and dialogue.  Improving transparency and accountability in public financial management and public procurement. The demand-side of public financial management needs to be improved 8 by disseminating information to the public and creating a culture of accountability and citizen participation. Reestablishing Growth and Macroeconomic Stability 32. Sustained reforms are required to enhance the business environment, in order to underpin growth and private sector employment. In the 2013 Doing Business Report, The Gambia is ranked 147th out of 185 countries and has dropped in all indicators except enforcing contracts. The Gambia’s ranking in the Global Competitiveness Report slipped from 81th of 133 in 2009/2010 to 98th of 144 in 2011/2012, but it remains the highest ranked in West Africa. The Report identified access to finance 23 and tax rates as the most problematic factors for doing business, far ahead of other issues such as tax and foreign currency regulations and inadequate infrastructure. 33. The energy sector of The Gambia - a major bottleneck for the business environment - faces a number of challenges ranging from structural and operational issues to the need for significant capital to upgrade and expand its generation, transmission and distribution capacity. The high cost and the lack of availability of electricity is a serious constraint to enterprise development and there is also concern that the sector amasses substantial contingent liabilities. The parastatal, the National Water and Electricity Company (NAWEC) is facing serious financial issues, and efforts are needed to improve its financial viability and operational performance24, including efforts to address power transmission and distribution losses. Given the small size and geographic position of the country, The Gambia will need to explore options for power generation and distribution in close cooperation with neighbors in the region such as through joint projects under the River Gambia Development Organization (OMVG). 34. Weak telecommunications links have affected the competitiveness of the business sector for many years, but basic telecommunications infrastructure is now being transformed by improved overseas and regional links. Access to the new high capacity submarine Africa Coast to Europe (ACE) cable will connect The Gambia and other West African countries with the rest of the world, and make telecom services, including high-speed internet services, more reliable and affordable. The challenge then will be for local telephone companies to provide an efficient technical and financial interface that will allow businesses and consumers to take advantage of this new link. 35. The Gambia’s performance in the tourism sector has been good as a result of recent reforms and institutional changes. Recent efforts have focused on increasing air access, and more needs to be done to (a) update the quality of accommodation (three stars and above); (b) diversify tourism products; and (c) improve service delivery by adequately training staff and fostering entrepreneurs. 36. The agriculture sector continues to be constrained by (a) insufficiently developed water management systems, leaving the country almost entirely dependent on rainfall, in spite of the availability of important inland water resources; (b) timely accessibility of farmers to quality inputs, credit, know-how and new technologies; (c) weakness in linkages for creating value added through agro-processing; (d) excessive post-harvest losses paired with low value addition, caused by weak storage, processing and marketing capabilities, and (e) climatic hazards, such as droughts and floods. While these challenges need to be tackled on the level of Gambian communities and households, regional cooperation on cross-cutting sector issues could play an important role in the 9 context of organizations such as OMVG and the West and Central African Council for Agriculture Research (CORAF). Due to its relevance to the Gambian rural economy in terms of income generation, the value chain linked to the groundnut subsector deserves particular attention. 37. Given the direct impacts of the most recent crises related to food price hikes, drought, and decline in agricultural production, there is a need for reshaping the food security agenda. A more coherent approach to food security will require that agricultural and food security interventions be embedded in the community nutrition service delivery platform (based on community needs, and implemented through community participation as opposed to top down government implemented programs). 38. Women across all ethnic groups do not have land rights in The Gambia. The Government is committed to addressing this issue and the PAGE recognizes the need to restructure the land tenure and inheritance system to correct for the “gender bias� and increase agricultural productivity.25 Strengthening Public Service Capacity for Service Delivery 39. Limited public sector capacity remains a significant constraint for service delivery. The major capacity bottlenecks include Box 2: Innovations in the Education Sector inadequate coordination among the various institutions within government. A number of innovations, analytical work and rigorous Additionally, there is little capacity in the studies have been introduced in the sector showing the ministries for strategic planning, government’s focus to carry out policy reforms that are evidence based. These include (i) a rigorous and prospective performance measurement and impact evaluation of whole school development and school management. Consequently, there is grants on students’ learning; (ii) a number of pilots to inform limited accountability for results and policy decisions such as a conditional cash transfer for Imams delays in the decision-making process. (religious leaders) to allow their students (from the Daaras) to learn literacy and math skills; inclusion of local languages in 40. These constraints are rooted in first grade to facilitate the acquisition of reading; a community based ECD pilot; (iii) strategy building for higher structural issues related to the incentive education policy, science and technology innovation and structure and competencies in the civil inclusion of ICT in education for 21st century skills service, and frequent and unpredictable development instead of traditional and rote learning methods; reshuffling of key Government officials, (iv) a system of accountability, such as the introduction of including ministers. In the short to performance management system that is based on annual service level agreements holding public sector servants medium term, a focus on the efficient accountable to meet their annual goals; and school report management of human resources within cards to share results with parents and communities at large. the civil service, including the recruitment and retention of personnel should be a first priority. 10 Improving social services 41. In the education sector, The Gambia has made significant strides in increasing the number of students enrolled at all levels. The remaining challenges for the education sector include (a) meeting the demands of hard to reach populations, in order to reach full enrollment, (b) improving early childhood, senior secondary and higher education and skills development in general, and (c) improving the quality of education overall, although important steps have already been undertaken in terms of provision of learning materials, teacher training support and provision of hardship allowances for qualified teachers in remote and poverty stricken areas26. 42. A significant proportion of young people, especially in rural areas, leave school early, in part because of perceived low returns on education. Many of those who do receive high- quality education and training choose to emigrate. There is clearly a mismatch between skills and market demand, and the gap between skilled and unskilled labor income, as well as urban and rural income is widening. The Gambia will need to align skills with the demands of the private sector labor market in promising sectors (tourism, agriculture, ICT), and provide incentives to attract qualified Gambians who are residing abroad back to their home country. 43. In the health sector, in order to achieve the health-related MDGs and meet the goals set out in the PAGE 2012-2015, two priorities stand out: (a) maternal health and nutrition; and (b) household food security. The current stagnation in maternal (and child) health and nutrition outcome indicators is mainly associated with: (a) a decline in support for Primary Health Care (PHC) in favor of a proportional increase in spending on tertiary health care, (b) the virtualization of health programs related to specific diseases, such as malaria, HIV/AIDS and tuberculosis, (c) centralized planning and budgeting, which leaves regions with little control over service delivery programs, and (d) limited harmonization of donor support and intra-sectoral funding processes. 44. Existing social protection programs, including safety nets, are fragmented and inefficient and do not respond to the needs of the chronic poor and the most vulnerable. Very little is known about the actual effectiveness and scope of existing safety net interventions in The Gambia. Most interventions are fairly small, temporary programs focused on short-term emergency relief and financed by ad-hoc external resources, rather than elements of a coherent medium-term strategy to protect the poor that could be scaled-up when a crisis occurs. A more coherent approach is needed to link the development of social protection strategies to reforms aimed at strengthening agriculture productivity, food security and nutrition outcomes at the household level. Improving Transparency and Accountability in Public Financial Management and Public Procurement 45. Public financial management and transparency have improved in recent years. Progress is reflected in the findings of the 2010 Country Financial Accountability Assessment (CFAA), the 2011 Public Expenditure Review (PER) Update, and the improved CPIA ratings. One key achievement has been the establishment of an Integrated Financial Management Information System (IFMIS). This system has improved the timeliness of financial reporting by providing monthly and comprehensive within-year budget execution reports, which facilitate the preparation of annual financial statements and subsequent budgets.27 As a next step, the IFMIS system needs to be upgraded and further expanded to include donor-funded projects and linked to the debt management system. Meanwhile, The Gambia has also reduced the backlog of audited 11 Government financial statements28, established a Tax Tribunal, and strengthened the internal audit function. 46. In the area of procurement, the Government issued a new report in March 2010 as an update of its 2005 Country Procurement Issues Paper. The proposed reform agenda includes three major objectives: (a) amending the Gambia Public Procurement Act, with a view to de-linking regulation from implementation; (b) re-engineering the Gambia Public Procurement Agency (GPPA) to become exclusively a regulatory body (similar to the Gambia Public Utilities Regulatory Authority, PURA); and, (c) establishing a procurement cadre that will be responsible for implementation. 29 To accelerate progress, the WBG will collaborate with the EU on an operation to support public procurement reform under the EU’s governance program. 1.6 The Gambia’s Development Strategy and Priorities Long-Term Vision and Priorities 47. The Gambia’s long-term strategic goals were articulated in its Vision 2020, which aimed “…to transform The Gambia into a financial center, a tourist paradise, a trading export- oriented agricultural and manufacturing nation, thriving on free market policies and a vibrant private sector, sustained by a well-educated, skilled, healthy, self-reliant and enterprising population, guaranteeing a well-balanced ecosystem and a decent standard of living for all, under a system of government based on the consent of the citizenry�. The Gambia’s Medium-Term Development Strategy 2012-2015 - PAGE 48. In 2012, the Government Box 3: Policy and Legal Framework for Gender Equity launched the “Program for Accelerated Growth and Improvements in gender equality features as one of the eight Employment� (PAGE 2012-2015), to priority areas in the Government’s PAGE, which also reflects priority objectives outlined in the Government-approved succeed PRSP II 2007-2011, based on National Gender Policy (2010-2020). Furthermore, the broad stakeholder consultations. The enactment of the Women’s Act in 2010 - a legislative milestone PAGE is based on the Government’s for women’s right in The Gambia – has been called one the most Vision 2020 and various sector comprehensive attempts to domestically enshrine international strategies, and is fully aligned with the and regional conventions on women’s rights. Significant challenges remain to allow men and women to MDGs. Its principle strategic objective equally live up to their development potentials, including, is to accelerate growth and employment women’s access to economic opportunities, participation in and reduce poverty. The PAGE targets a decision making and a still high maternal mortality rate. 15 percent decline in the poverty And still, every day in The Gambia thousands of women and headcount index to 33.4 percent, girls are victims of gender-based violence including sexual assuming a 3.1 percent per capita abuse, trafficking or early and forced marriage. Also, 80 percent of girls are submitted to the practice of female genital growth rate over the 2011-15 period. mutilation. The PAGE was discussed in the IMF/IDA Joint Staff Advisory Note (JSAN) of March 8, 2012. 49. One key conclusion of the JSAN was that further prioritization of objectives and activities is required given the constrained resource envelope. The Government estimates the total cost of implementing the PAGE at US$943 million. Taking into account the resources already available for on-going projects, the shortfall in resource requirements is more than US$650 million. The Government is committed to contributing 35 percent of this amount, leaving a financing gap of US$423 million to be financed by donors and the private sector. 12 50. The JSAN also highlights the importance of regional integration for the country, recommending that PAGE implementation pay close attention to regional trade arrangements. In addition, it highlights the need to take advantage of regional programs funded by various donors, including the AfDB and IDA programs on dry lands, water resources management, and regional agriculture. 51. One of the challenges for the PAGE implementation is the weakness of the country’s statistical system. Improving the timeliness and quality of statistics would greatly support the economic development program delineated in the PAGE, which now lacks target indicators for development results due to a dearth of data or, in some cases, significant lags between completion of field surveys and their publication. A further constraint is the limited capacity at all levels to analyze and use data effectively. There is also a need to monitor and track governance and related indicators, as well as to increase the frequency of disease surveillance and continue building the database for health information. Improving macroeconomic accounts is also critical to better support macroeconomic management. The JSAN recommends prioritizing implementation of the Government’s “Strategic Plan for the Development of Statistics in The Gambia,� which focuses on continued structural reforms and capacity building of the Gambia Bureau of Statistics. The authorities have asked donors, including the WBG, to renew their support for the country’s statistical system. III. THE AfDB AND WBG SECOND JOINT PARTNERSHIP STRATEGY 2.1 Lessons from the Previous Joint Assistance Strategy (JAS), Stakeholder Feedback and Gender Assessment Lessons from the JAS-1 Completion Report 52. Results and lessons from the first IDA/AfDB Joint Assistance Strategy (JAS-1) for the period of 2008-11 were assessed in a JAS Completion Report (see Annex 3). The results have been assessed as moderately satisfactory by both Banks as good progress was made towards achieving most major expected outcomes. 53. One of the key lessons from the experience of the JAS-1 is that the JAS was a useful tool for coordinating the development efforts of both Banks. Despite some processing challenges due to different disbursement schedules, the collaboration was determined to be very successful in improving the impact of the development efforts by the two Banks, and should be continued. The collaboration allowed the two institutions to align their development programs, avoid duplication of efforts, and combine their technical expertise. WB and AfDB have worked together to develop shared objectives and a common platform for lending and non-lending activities in line with the country’s priorities. Findings from WB IEG Evaluations, 2012 Country Survey, Stakeholder Consultations and Portfolio Gender Assessment  54. The ex-post project evaluations carried out by the WB Independent Evaluation Group (IEG), lessons learned emphasize the importance of strong Government leadership, and coordination between line ministries and implementing agencies, for the successful implementation of programs and projects. A better understanding of political economy issues is also critical for the effective design of sector reforms. IEG evaluations also highlighted the importance of quality at entry, managerial and technical capacity and project management for 13 good project implementation. 55. The FY12 Country Survey shows that the WB is valued for its work. Stakeholders value the Bank’s policy and economic advice as much as its financial resources, and are satisfied with the overall relationship. Issues raised were related to (a) alignment of the Bank’s priorities with perceptions of the country’s top priorities; and (b) Bank procedures and policies (perceived lack of flexibility, complexity of its financing and levels of bureaucracy). At the country level, there is clear recognition that capacity is lacking and that reform efforts need to be tailored to country challenges and circumstances. 56. The content of the proposed JPS-2 is based on in-depth discussions with the Government and consultations with donors and other stakeholders on various occasions, preceding a round of more comprehensive multi-stakeholder consultations in March/April 2012. 57. The 2012 WB Portfolio Gender Assessment concluded that the current IDA portfolio in The Gambia is fully gender informed, meaning that the ongoing IDA and TF portfolio addresses gender-related aspects in their analysis and/or actions, specifically with respect to (a) gender parity in basic lower and upper education levels; (b) productivity and access to markets for female farmers; (c) nutrition of children and lactating women. Some operations also have a substantial gender informed monitoring and evaluation framework. The AfDB 2011 Gender Profile for The Gambia30 provided a picture of the policies, programs and practice areas that have promoted women’s empowerment and gender equality in the Gambia. Conclusions and recommendations of both documents have informed the preparation of the proposed Joint Strategy. 2.2 The Portfolios of Both Banks 58. The current IDA portfolio (Table 5) for The Gambia comprises six active operations (including two regional projects and one budget support operation), representing a total commitment of US$77.75 million. The IDA portfolio is complemented by TF resources totaling about US$36.75 million. 59. The current AfDB portfolio (Table 6) for The Gambia consists of eight active operations (including one regional project and one budget support operation), representing total commitments of UA89.34 million. The AFDB portfolio includes TF commitments totaling about UA8.4 million. 60. The performance of both portfolios is overall satisfactory. Positive examples include WB-supported operations in the education sector, The performance of both portfolios is overall satisfactory. Positive examples include WB-supported operations in the education sector, implemented by a single Project Coordination Unit (PCU) that manages all projects in the sector and is fully integrated into the Ministry of Basic and Secondary Education (MoBSE). Based on its successes so far, the Gambian MoBSE has been presented as a case study in a 2012 WB research project on Building State Capacity in Challenging Context. The MoBSE Permanent Secretary has received an international award31 for outstanding services in the same year. In addition to their lending program, the Banks have been engaging in a range of analytical work and technical assistance (see Annex 3) . 14 Table 5: Current Active WB Lending Portfolio in Table 6: Current Active AfDB Lending Portfolio in The Gambia The Gambia Project / Activity Funding Funding TF IDA TF name (US$m) (US$m) Budget Support - DPL 5 Project / Activity Funding Funding TF West-Africa Regional 35.0 ADF TF name Communications (UA) (UA) Infrastructure P. / GM West-Africa Agricultural 7.0 Livestock & Horticulture 4.02 Productivity P. / GM P. Growth & Competitiveness 12.0 Artisanal Fisheries 5 P. development P. Integrated Financial 5.25 Rural Water Supply & 1.11 3.58 RWS Management Information Sanitation P. SI System (IFMIS) P. Entrepreneurship 8 Third Education Phase 2 P. 13.5 Promotion and Education For All P. Microfinance P. 28 GPE Transport Trans-Gambia 63.55 Support of NGO Network 0.2 JSDF River crossing P. TANGO PISP for Economic and 2 Third Education P. - II 1.3 JSDF Financial Governance Sustainable Land 2.84 GEF Teaching Physics and 0.49 IDF Management P. Mathematics (pilot p.) Support to National Water 1.98 AWF BEIA-Promotion of 0.15 BEIA Reform P. Improved Biomass Vesto Stoves Total 84.52 8.4 Rapid Response Nutrition 3 RSR Security Improvement P. Integrated Biodiversity 1 GEF Management P. Emergency Agricultural 3 JSDF Production Support P. Total 77.75 36.14 61. The International Finance Corporation (IFC)’s strategy in The Gambia is selective and is focused on (a) enhancing the capacity of local financial institutions (through advisory services and financing) to improve access to finance of potential Small and Medium Enterprise (SME) clients; and (b) selectively supporting committed and experienced sponsors in priority sectors (tourism, agriculture). IFC’s outstanding committed amount as of June 30, 2012 is US$8.5 million, including US$6.5 million in Coco Ocean, a tourism project, and US$2 million with Ecobank Gambia. IFC's investment in Coco Ocean supports the development of a new up-scale market niche and promotes The Gambia’s image as a quality destination, with the aim of attracting visitors with higher purchasing power. To further strengthen the country’s banking sector, the IFC committed two investments in Ecobank Gambia, including a US$0.3 million tier-2 investment through the IFC managed Cap Fund and a US$2 million trade finance facility under the Global Trade Finance Program, with the latter expected to foster external trade, including for SMEs. The Multilateral Investment Guarantee Agency (MIGA) has not yet issued coverage for any investments in The Gambia. 15 2.3 The JPS-2 Strategic Approach Strategy Overview 62. The Banks’ overarching objective for the proposed JPS-2 is to support the Government’s efforts to address major challenges in the areas of poverty reduction, job creation and economic growth, in light of the country’s vulnerability to external shocks, and in line with priorities outlined in PAGE 2012. The JPS-2 builds on the successful implementation of the preceding JAS-1, and gives priority to the consolidation of progress achieved and to creating linkages among areas of interventions in order to strengthen resilience on both the macro and micro levels. Given the high elasticity of poverty with respect to growth, the underlying expectation is that the promotion of growth through interventions in agriculture and rural development will contribute significantly to poverty reduction. 63. Governance represents a key factor for achieving the growth and service delivery results envisioned in the Government strategy. Strengthening governance, including through a solid and predictable policy and macro-economic framework, is critical for providing an enabling environment for productive investments to unlock the country’s full growth potential. Similarly, more effective and transparent management of public resources, along with enhanced human resources capacity could support improvements in service delivery. The JPS recognizes the cross- cutting role that governance plays in the two proposed pillars. In light of the considerable governance challenges, the JPS proposes to focus on areas where progress has been recorded, i.e. economic development with a specific focus on rural areas, and service delivery for human development. Sector operations also will more systematically take governance into account in their project design. The JPS also includes a dedicated governance and capacity building operation in the outer year of its implementation period, which will further support an integrated approach to governance and maximize development effectiveness across the two pillars. 64. Under the proposed new JPS, the Banks would provide technical assistance and analytical and financial support to a joint and complementary program which focuses on the following two pillars: JPS-2 Pillars Pillar 1: Enhancing Productive Capacity and Competitiveness in order to Strengthen Resilience to External Shocks - aligned with elements of PAGE pillars I (Economic Growth), II (Infrastructure) and IV (Governance). Pillar 2: Strengthening the Institutional Capacity for Economic Governance and Public Service Delivery - aligned with elements of PAGE pillars III (Human Capital, Social Services), IV (Governance) and V (Social Cohesion, Cross-cutting interventions). 65. These pillars are a slightly modified version of the JAS-1 pillars reflecting a shift in priorities given the country’s most recent exposure to external shocks which affected both the drivers of growth and the Government’s capacity for service delivery. 66. The approach of the JPS is to consolidate gains achieved in previous years, while 16 selectively exploring new areas of intervention in the outer years. The Gambia’s overall development agenda has not changed fundamentally, and the resource allocation of both Banks is limited. 67. The principles proposed by AfDB and the WBG to guide the design of the JPS program are as follows:  Draw on the comparative strengths of each Bank and on AfDB’s focus on economic governance and agriculture, specifically in response to the 2011 Sahel drought crisis.  Ensure complementarity and avoid overlap, with the activities of other key donors.  Align the activities, where possible, with key institutional and regional priorities of both Banks, including the AfDB RIAS and the WB Africa Strategy.  Given the small size of the country, regional integration will be a cross cutting theme as it was in the previous JAS. Regional program resources will be used, where available to leverage the national IDA and/or ADF allocations and acquire GEF co- financing while assuring selectivity in the overall lending program.  The JPS-2 program will be very selective and focus on only few key areas of intervention, i.e. governance/public financial management, agriculture/rural development (both Banks in close cooperation); critical infrastructure (AfDB on transport and WBG on energy); and service delivery in the education and health sectors at the community level and in combination with interventions on improving nutrition for mothers and children (WBG).  Both Banks will further deepen attention to gender throughout their lending and non- lending portfolios in line with the national Gender Policy. 68. The proposed new strategy has been designed and will be implemented jointly by teams from both Banks, and (partly) also with other stakeholders, to ensure maximum of synergies in approaches and activities, as recommended by the JAS-1 Completion Report. The proposed strategy includes a joint results matrix which – to the extent possible – specifies which partner is undertaking which activities. Expected Results and Program of Lending and Non-Lending Activities  Pillar 1: Enhancing Productive Capacity and Competitiveness in Order to Strengthen Resilience to External Shocks 69. Pillar I focuses on promoting a competitive investment climate, strengthening the agriculture and rural development sectors, including through drought recovery measures, and developing key supporting infrastructure, with a focus on energy and water sectors – with a view to strengthening the economy’s resilience to external shocks including those related to climate change and extreme weather events. 70. Agriculture and Rural Development: Interventions by both Banks will aim to promote more diversified and efficient production of priority agricultural commodities by both smallholders and commercial farms. Specifically, the interventions will promote good practices and strengthen capacities for sustainable and efficient management of the country’s water resources. The approach will ensure that agriculture and rural development are geared towards environmental sustainability and linked to poverty alleviation, improved food security, nutrition and social protection – and that macro-economic policy, addressed under Pillar 2, builds the necessary supportive framework for sustainable results in these fields of intervention.32 Support 17 will also include the generation and dissemination of adapted technology for enhanced agricultural productivity in the context of a regional program. One additional focus will be to create incentives for increased private sector engagement, including commercial agriculture. 71. Rural development and agriculture under the proposed JPS will be supported by a new IDA Commercial Agriculture and Rural Development operation (CARD, US$14 million, FY14), complemented by the FY13 (second) Emergency Agriculture Production Project (JSDF grant, US$3 million). The design of both operations will be informed by an Agriculture Sector Policy Note that was prepared in 2012 in the context of the preparation of the proposed JPS. Synergies will be created with the regional IDA West Africa Agricultural Production Program and the ADF-supported Regional Sahel Resilience Program. Relevant AfDB projects include the GAFSP Food Security Project to enhance food security planned for 2013; and the multinational Sahel Resilience Project, which includes The Gambia and aims at developing measures and techniques to counter weather variability. 72. Production-oriented activities would be complemented by a targeted approach towards social protection for the most vulnerable rural population through community-driven development (CDD) activities to strengthen resilience to external shocks / adverse conditions on the local level. A CDD component in the CARD will use social protection strategies to support demand-driven activities on the local level related to preventing the impacts of adverse weather conditions on agricultural production, and make provision for food security and sustained nutritional outcomes for the most vulnerable, under-served rural poor population.33 The proposed JPS will build on the multi-sectoral experience in nutrition and CDD from the previous JAS period. By targeting women, promoting small-scale and diversified food production, and expanding food and nutrition behavior change communication strategies, the WBG will support the Government’s efforts to improve the food security and nutrition of its population. JPS-2 Outcome 1 – Adoption of Diversified Production and Marketing of Selected Agricultural Commodities Outcome Indicators:  Number of additional households engaged in food diversification through small scale fruit and vegetable production, and/or small animal husbandry (25,000 by June 2016 from 0 in 2012). JPS-2 Outcome 2 - Adoption of improved technologies in Agriculture  Number of additional beneficiaries who have adopted technologies for enhanced agricultural productivity and storage (120,000 by June 2016 from 0 in June 2012).  Incremental percentage increase in horticulture sales ≥ 15% in June 2015, from 0% in September 2012 relative to baseline of GMD 3,644 in January 2011) 73. Investment Climate: The IDA Growth and Competitiveness Project (GCP) will continue to provide support to strengthen the competitiveness of key sectors and improve the investment climate. The project will support activities to (a) reduce the costs and delays of starting and operating businesses in The Gambia, including the time and costs associated with compliance with tax regulations and (b) improve the collateral registry. These activities will foster competition and competitiveness, while reducing an important constraint in terms of access to 18 finance for firms. Tourism is an area of focus of the project, and the revamping of the Gambia Tourism and Hospitality Institute will help provide the necessary skills needed to run the tourism establishments. 74. Finally, to further ground the Government's private sector development policies, it is important to strengthen the public-private dialogue, through the provision of technical assistance (TA), logistical and personnel support. The newly established Gambia Investment and Export Promotion Agency (GIEPA) is expected to improve private-public dialogue and facilitate investment with support from the GCP. The administration of investment incentives has reportedly improved and there are renewed efforts in investment promotion. The banking sector continues to perform relatively well, although access to finance remains a constraint with government borrowing crowding out the private sector. The scope for private participation in infrastructure is promising if a clear policy and regulatory framework is put in place. 75. The Government has expressed interest in analytical support for financial sector strengthening, private-public partnerships, and trade logistics to complement a number of the interventions supported under the GCP. A multi-sector study on Sources of Growth, Business Environment and Labor Markets will spell out the main opportunities in agribusiness, mining, tourism and urbanization and help guide the implementation of the current PAGE and the preparation of a follow-up strategy. This piece of analytical work will also leverage and complement the 2009 ICA. Other analytical work will include a Trade Logistics study, a Financial Sector Development Strategy and studies on the development of critical public private partnerships (PPPs). A request to the AfDB by the Trust Bank Gambia Ltd. for a line of credit for on-lending to SMEs, is still awaiting a response. 76. The JPS also proposes to prepare analytical work on Higher Education (tracer study of higher education graduates) which could inform the Government’s first ever higher education policy aimed at aligning human resource competencies and the labor market. IFC aims to support vocational training schools to improve specialized professional skills among the working population. 77. IFC will explore how to further support private sector initiatives, especially in the power, financial education and agribusiness sectors. To ensure that economic recovery is inclusive and sustainable, the focus will be on promoting and engaging the local private sector, particularly SMEs. IFC is active in developing trade with a commercial bank under its Global Trade Finance Program that is aiming at increasing trade and SME financing. In addition to facilitating access to credit via the banking sector, IFC will develop the capacity of SMEs to actively participate in the supply and value chains of the large projects in the country. In this regard, assessment activities will gauge the potential for Business Edge training programs to serve as the SME capacity development component of the Africa Micro, Small and Medium Enterprises (AMSME) programs with financial institutions. JPS-2 Outcome 3 – Improved Business Environment Outcome Indicators:  Cost of registering a business (<140 % of GNI/capita by June 2015, from 206.10 % in September 2012) 78. Infrastructure: IFC is ready to mobilize resources to support the Government in 19 identifying bankable opportunities in the telecom, power, water, road and transport sectors. In particular, IFC is engaging in a dialogue with The Gambia’s institutions and development partners in order to identify PPP possibilities that might be in the best interest of the country, in partnership with the Public Private Infrastructure Advisory Facility (PPIAF). 79. Energy: Development of the electricity sector, specifically as related to the organizational effectiveness of NAWEC and the exploration of potential for PPPs, would be followed up by through the implementation of the recommendations of the 2010 Energy Sector Diagnostic Study. The WBG will support an Integrated Resource Planning Study (funded in part through an Additional Financing grant under the IFMIS Project, and in part by the PPIAF) aimed at reducing the NAWEC’s burden on government accounts, and prioritizing needed investments. A more important investment in the energy sector will be provided by the WBG’s Energy Sector Support Project (US$8 million, FY15). IFC support to any Independent Power Producer project will be contingent to reforms of the sector and NAWEC. The AfDB is considering supporting private-sector investments in thermal and renewable energy. 80. Transport: The AfDB will continue supporting the Gambia on more efficient cross- border road infrastructure, specifically as related to the Trans-Gambia Bridge to Senegal that will be critical in facilitating of cross-border trade in the sub-region. IFC has been in preliminary discussions with AfDB regarding advisory opportunities on the Trans-Gambia bridge project. JPS-2 Outcome 4 - Improved Cross Border Transit Time.  Reduced transit time across the Gambia River (from 79min in 2012 to <30min by 2016)  Reduced waiting time at borders (from 4 hrs in 2012 to 2 hrs by 2016) 81. Telecommunication: The IDA West Africa Regional Communication Infrastructure Program (WARCIP) has helped The Gambia connect directly to the new high capacity ACE submarine cable connecting Africa with Europe. It will facilitate the introduction in The Gambia and in the region of high speed internet services, and make telecom services more reliable and affordable for consumers. The program is structured to address critical connectivity gaps through (a) the establishment of infrastructure and institutional set-up for the landing of the ACE cable and (b) TA to strengthen the enabling environment for connectivity, including the policy and regulatory framework for open access, in close collaboration with the private sector. JPS-2 Outcome 5 - Improved Telecommunication/Internet connectivity Outcome Indicators:  Volume of international traffic: International Communications (Internet, Telecoms, and Data) bandwidth per person (kbit/per person) (30kbit/person by December 2016, from 10kbit/person in September 2012)  Volume of available international capacity: International Communications (Internet, Telecoms, and Data) bandwidth (Gbit/s) (5.9 Gbit/s by December 2016, from .16 in September 2012) 20 Pillar 2: Strengthening the Institutional Capacity for Economic Management and Public Service Delivery 82. Pillar II aims at consolidating the gains reached in the 2008-2011 JAS period on transparency and accountability in the use of public resources, improving the performance of the civil service, improving public service delivery and quality with a focus on education, nutrition and community health, and social protection, and making further progress in these areas consistent with the PAGE and the MDG objectives. 83. The main outcomes of the proposed JPS under this pillar will refer to improved fiscal and macro-economic management, and improved service delivery in terms of improved quality of learning outcomes for basic and secondary education, and nutrition and health outcomes for women and children. 84. Recent progress in economic management will be consolidated and further enhanced during the coming JPS period. Aspects of public financial management (budget planning, execution, reporting; public procurement, internal and external auditing; aid coordination) as well as macroeconomic management, education sector management and the role of the private sector with specific focus on PPPs, the energy sector, the hospitality industry and agriculture will be covered by a series of budget support operations, determined under a Joint Budget Support Matrix, as agreed between AfDB, IDA and the Government. The series would be split in four operations (two by each Bank) in the overall amounts of UA3 million and US$11 million, respectively, over 3 years. 85. On-going institutional support and technical assistance to the Ministry of Finance and Economy (AfDB’s second Institutional Support for Economic and Financial Governance, ISPEFG II and IDA’s IFMIS-Project) will complement the economic governance reform agenda. The IFMIS Project will be extended and resupplied with fresh resources through an Additional Financing (AF) operation that would aim at further rolling out and deepening the IFMIS modules. In particular, the IFMIS system could be upgraded to a newer web-based version and expanded to include donor-funded projects which constitute about 40 percent of the national budget and a link with the debt management system. Additional efforts could also be taken to improve the demand side of public financial management by actively disseminating information to the public and creating a general environment encouraging transparency, accountability, and participation34. The routine publication of IFMIS-generated government fiscal operations reports on the web will serve as a key measure to trigger demand side accountability for improved allocative efficiency. The envisaged AF for the IFMIS Project will also support a strategic energy study - as the energy sector represents a large off budget liability that threatens the country's overall fiscal balance. 86. Specifically on Public Financial Management, the WBG will work with the Government to develop a Customs Assessment Trade Toolkit – an integrated monitoring tool to measure customs performance over time, to ensure consistency with best practice and/or best fit, using objectively verifiable data sets. This will provide additional analytical underpinning for a focused engagement with the Government in the implementation of requisite policy reforms that could lead to common and simplified customs procedures as well as strengthened regional integration. A Public Expenditure and Financial Accountability (PEFA) Assessment is foreseen for FY14, and Institutional Development Fund (IDF) resources (US$0.7 million) will be requested for the implementation of actions aimed at strengthening the Public Accounts 21 Committee (PAC) in its oversight role over the three-year period starting in mid-2013. JPS-2 Outcome 6 – Improved Public Financial Management Outcome Indicators:  Completion of accounts reconciliation within 30 days of the end of the month for at least 12 months in a row by end 2016.  Time needed for Public Accounts Committee’s completion of review of latest audit reports (within 12 months of receipt from the NAO by June 2016, from >12 months in 2011).  Number of procurement organizations compliant with the Gambia Public Procurement Act, as reflected in annual Gambia Public Procurement Agency report. (9 by end-2015, from 0 in 2012) 87. The WBG will also collaborate closely with the European Commission (EC) to improve governance in the Gambia, under the public financial management component of the EU Governance Support Program approved in 2011. The WBG will prepare and implement a technical assistance intervention funded under the EU Program, which aims at boosting Public Procurement Reform by (a) strengthening the Gambia public procurement institutions, (b) improving the efficiency and transparency of the country’s public procurement system, and (c) enhancing the compliance of the national procurement system with international quality standards. In addition, options to link activities in support of public procurement with the IFMIS Project will be explored, as part of tackling the bigger challenges in PFM and governance. 88. The ongoing, incremental civil service reform will be supported through the continued implementation of a small Institutional Development Fund (IDF) grant for technical assistance to support key components in the Government’s long term Civil Service Reform agenda, specifically in the areas of strengthening the capacity for human resources management, and wage bill and pension management. Building on this grant, the new JPS will provide support to more effective service delivery through extensive capacity building and the introduction of performance management tools in collaboration with other development partners, notable the EU and UNDP. 89. In addition, the WBG has agreed to resume support to statistical capacity development for the Gambia Bureau of Statistics (GBOS) and for statistical departments in line ministries with financial resources to be requested from the Trust Fund for Statistical Capacity Building (TFSCB). The AfDB has launched the 2011 round of the International Comparison of Prices (ICP) Program with price data collection in 18 regional member countries, including The Gambia, in support of and in close collaboration with GBOS. 90. In the social sectors, support will concentrate on education, and on nutrition and household food and nutrition security in combination with community-based health care. 91. In education, the successful WBG support during previous years, with its strong focus on access, will be continued under this JPS with a stronger focus on education quality. The ongoing Education for all Fast Track Initiative Project financed by the Global Partnership for Education (GPE), and the IDA Third Education Project (phase 2) will be completed. A follow-up IDA Education Sector Support Project and, if possible, a new GPE Basic Education Grant, would be prepared for FY14 to continue the reform process aimed at improving the quality of learning 22 outcomes for basic education. Complementary to these investments, a small number of very targeted analytical work and technical assistance will help define and support certain elements of reform, notably a Survey on Parenting Practices, an operation to develop a program for Teaching Math and Physics through E-learning, and a National Language Pilot TA. JPS-2 Outcome 7 – Improved quality of learning outcomes for basic education Outcome Indicators:  % of teachers whose attendance is over 90% in 2016 by region, from 75% in 2012.  % of students reaching the minimum literacy standard on grade 3 NAT reaches 43% in 2016, disaggregated by gender, from 36.7%, in 2012. 92. In the area of maternal and child health, nutrition, and household food security the WB will follow-up on the support provided to the Gambia National Nutrition Agency under the JAS-1 with a combined IDA / TF operation focused on Community-based Nutrition and Primary Health Care Services for maternal and child health and nutrition – in close coordination with activities for rural and agricultural development. This operations will use Results-Based Financing (RBF). Improved service delivery performance in primary health and community nutrition, together with complementary measures as suggested in the 2012 Global Monitoring Report, will strengthen household food and nutrition security resilience in the wake of external economic shocks, thereby supporting the Government in developing more effective social protection strategies. The AfDB is considering investment options in the health sector through support to a private clinic in collaboration with the private sector. Outcome 8 – Improved nutrition and health services for women and children Outcome Indicators:  Proportion of births assisted by skilled personnel (65 percent by June 2016, from 57% in 2012)  Exclusive breastfeeding rate in the first six months (i.e., proportion of children 0-6 months exclusively breastfed in the last 24 hours) (40 percent by June 2016, from 34% in 2012)  Prevalence of anemia in children under five (52% by June 2016, from 62% in 2012) 93. The application of the RBF approach to the health and nutrition service delivery will be a catalyst for improving service delivery systems by strengthening accountability systems as a means of providing quality services to poor people. Substantial technical assistance accompanying RBF processes will be provided, including TA for the management information system, the external verification of results, integrated program planning and budgeting, and inter- agency coordination and organizational development. In addition, the WBG will work with UNICEF to monitor household food and nutrition security through child anthropometrics. These analytical products and the Multiple Indicator Cluster Survey results of 2010 will provide the basis for policy dialogue. 23 94. The Bank will provide technical support to help the Government Review the Social Protection Programs (including safety nets) and define a concrete action plan for developing an efficient system. One lesson from experience in other countries is that the most effective approach to prepare for crises is to build elements of a safety net system that can be used in normal times as a permanent program for vulnerable groups (for example infants, pregnant women, the disabled) and can be scaled up to cover others in periods of crisis. 95. Disaster Risk Preparedness: A US$660,000 grant for a Bank executed non-lending TA project, currently under preparation, will help reduce vulnerability to disaster and foster disaster preparedness. The team will explore options to create synergies among this activity and the envisaged new Commercial Agriculture and Rural Development Project and the recently approved Emergency Agricultural Production Support operation, specifically on risk mitigation measures. 96. The government will make an effort to build on the recently approved gender legislation in country, to deepen the WB’s effort to ensure gender issues are built into the projects. 2.4 Implementing the Second AfDB / WBG JPS Financial Envelope 97. The proposed program design is based on the assumption of a three year (2012-14) ADF resource allocation for new commitments of UA3 million (equivalent to US$4.5 million) from ADF 12 available for 2012 and 2013 and UA 8 million (equivalent to US$12 million) from ADF 13 available for 2014 and 2015, in addition to an indicative IDA-16 allocation of SDR 29.8 million (equivalent to US$44.7 million35) followed by estimated IDA-17 annual allocations of US$14 million. This would amount to a total in combined ADF and IDA funds over the four-year JPS period of almost US$90 million, supplemented by TF resources. Both AfDB and IDA have been quite successful in leveraging additional resources through Trust Funds and will continue to do so under the JPS-2. Additional resources could come from the Global Agriculture Food Security Program (GAFSP), Rural Water Supply & Sanitation Initiative (RWSSI), African Water Facility (AWF), IDF, GPE, GEF (specifically, on dry land agenda and environmental stability as part of the envisaged CARP) and Bank-executed TFs for technical and analytical work. Added to this would be allocations for regional projects, to be determined, from both Banks. Managing Program Implementation 98. The JPS-2 lending program (Table 7) will be implemented by Government implementing organization (IO) and Project Coordination Units (PCUs) or Project Implementation Units (PIUs) with close support of the WB and AfDB teams. Due to capacity limitations, most PCUs are still not fully mainstreamed into the respective implementing organizations. It will be crucial to build mechanisms that would allow the transfer for knowledge and skills related to project management in these organizations, including strategic planning, fiduciary management, and monitoring and evaluation, on all levels. 99. Program implementation will be continuously reviewed through annual Country Program Performance Reviews, in addition to the close follow-up on implementation by sector teams. Progress on the implementation of the proposed JPS will be analyzed in the course of a 24 mid-term review and subsequent elaboration of a JPS Progress Report. Table 7: Indicative Lending Program for AfDB/WB Projects and Trust Funds Amount (parallel financings) JPS Pillar Fiscal/ WB Operation AfDB Operation US$ UA Calendar million million Year FY 2013 Emergency Agricultural Production 2 (TF: GCRF) 3 Pillar 1: Enhancing FY 2014 Commercial Agriculture and Productive Capacity Rural Development/CARDP, and Competitiveness excl. CDD component (IDA) 8 in order to FY 2015 Energy Sector Support (IDA) 8 Strengthen Resilience CY 2015 Regional Sahel 0.8 to External Shocks Resilience CY 2013 GAFSP co-financing 2.2 FY/CY 2012 Budget Support 1 (IDA) Budget Support A 6 1.9 (already delivered) CY 2013 Budget Support B 1.1 FY/CY 2014 Budget Support 2 (IDA) Budget Support C 5 5 Pillar 1+2 CY 2014 Budget Support 3 (IDA) 6 FY 2015 FY 2016 Budget Support 4 (IDA) 6 FY 2016 Regional 1 FY 2014 IFMIS Additional Financing including Energy ESW (IDA) 5 FY 2014 Community Nutrition and Pillar 2: Primary Health Care (IDA) 2 Strengthening the (TF: RBF) 5 Institutional FY 2014 CDD component /CARDP Capacity for (IDA) 6 Economic FY 2014 Education Sector Support Governance and (IDA) 12.7 Public Service Education Sector Support Delivery (TF: GPE) 6.9 FY 2016 Governance, incl. private 7 sector governance, debt management, PFM (IDA) Total 87.6 11 25 Partnerships and Donor Coordination 100. The Gambia continues to be highly dependent on external development assistance. More than 80 percent of the country’s development budget is financed by the international donor community. In addition to the AfDB, the IMF and the WB, major development partners currently include the Islamic Development Bank; the EU; DFID; OPEC; UNDP; IFAD; the UN agencies; Taiwan, China; and Japan. However because of budget constraints in donor countries, external donor assistance is expected to decline slightly over the period 2012-2015. Moreover, donors raise concerns about respect for the constitution, the rule of law and good governance in the country, specifically as related to the events of August 2012. The EU is considering options for an escalation of pressure through the ongoing political dialogue under Article 8 of the Cotonou Agreement, which could, as a last resort, lead to a suspension of EU support under Article 96 of that Agreement. 101. Aid harmonization is an important issue in a small country such as The Gambia. While an overall framework for external partners’ coordination is not yet in place, the recent introduction in The Gambia of a joint Government/donor review of budget allocations and performance on a quarterly basis is a good step forward. The Gambia has signed the Paris Declaration on Aid Effectiveness, and most external partners are aligning external assistance with country objectives as presented in the PAGE. The preparation of this JPS has been discussed with other partners. And a two-day donor conference in support of the implementation of the PAGE, organized by UNDP, was held in July 2012. Close cooperation is envisaged with a number of donors, including on fiduciary and governance issues; for example on public procurement reform with the EU. 102. In addition to the close cooperation between AfDB and WB on the budget support policy matrix, donor harmonization is most advanced in the education sector (Table 8). At the pre-higher education levels, IDA and GPE (previously called EFA FTI) are the largest partners supporting the systemic issues. WFP will continue to support school feeding with a view of developing a home grown school feeding program. UNICEF will continue to provide support to the child friendly school initiative. The Islamic Development Bank has recently negotiated a US$10 million project to support bilingual education in madrassas. At the higher levels of education, Islamic Development Bank, Kuwaiti Fund, OPEC, the Arab Bank for Economic Development of Africa (BADEA) and Saudi Fund are supporting the construction of faculty buildings and student dormitories for the expansion of the University of The Gambia. During the JPS period, IDA will focus on providing strategic advice and technical assistance as required. Efforts are also underway for close consultations and harmonization of donors supporting the agricultural sectors under leadership of the AfDB, and including the WB, Islamic Development Bank (IDB) and the Institute for Agricultural Development (IFAD). Joint project supervision with other donors will be sought where interests overlap, along the lines of what is already in place in the education sector.36 More generally, both banks will continue to work with the Gambia and other development partners to foster donor coordination. 26 Table 8: Combined Donor Support to the Gambia Education Sector Donor partner Area of support and estimated amount Time period Islamic Development Bilingual education in Madrassas (US$10 million) 2012-2016 Bank UNICEF Child friendly initiative (US$3 million) 2012-2016 Basic WFP School feeding (US$12 million) 2012-2016 (including GPE (previously called Improving learning outcomes 2014-2018 ECD) and EFA FTI CF) (US$6.9 million - indicative allocation) Secondary IDA Support to quality of education at all levels 2014-2018 Education (US$12.7 million--indicative allocation) Saudi Fund Construction --University of The Gambia 2012-2016 (US$10 million) Islamic Development Construction --University of The Gambia 2012-2016 Bank (US$15 million) Kuwaiti Fund Construction --University of The Gambia 2012-2016 Higher (US$14 million) Education OPEC Construction --University of The Gambia 2012-2016 (US$5 million) BADEA Construction --University of The Gambia 2012-2016 (US$7million) Monitoring and Evaluation 103. The Ministry of Finance and Economic Affairs will be responsible for the co- ordination, monitoring and evaluation of the progress of the five pillars of PAGE through the existing PAGE National Implementation Team. The overall management will be through a National Coordination Committee that will report to the Ministerial level High Level Economic Committee. On the Civil Society side, a pro-poor advocacy group (Pro-PAG) established by Civil Society Organizations (CSOs) to participate in the monitoring of PRSP 2 would also participate in monitoring PAGE implementation. 104. The WB, AfDB and others will continue to strengthen the capacity of the semiautonomous Gambia Bureau of Statistics (GBOS). The poverty database has been improved through the 2010 Household Budget Survey and the 2011 Poverty Assessment - both supported by UNDP. 105. A JPS results framework will be put in place by the WB and AfDB similar to that used for the 2008-11 JPS, which will allow adequate review of AfDB and WB contributions toward the development of The Gambia under the JPS-2. As to the recommendations of the JAS-1 CR, JPS outcomes will be strictly aligned to specific interventions proposed in the JPS program. There will be no separate JPS results monitoring foreseen by the government or non-governmental stakeholders. 106. The Results Matrix (see Annex 1) will include a list of results and intermediate outcomes to be monitored during the period FY12-15 based on envisaged project outcomes and indictors, in order to ensure attribution to the work of both Banks and for which the two institutions will be jointly held accountable. Project activities will be assessed on a regular basis, including during regular portfolio reviews. The JPS implementation monitoring system will be linked to the Government’s PAGE monitoring through (a) regular reporting on AfDB/WB projects and programs (review of key performance indicators, portfolio reviews, project completion reports), and (b) a planned mid-term evaluation of the JPS. 27 IV. MANAGING RISKS 107. The program supported by the proposed JPS carries risks, including governance, political, macroeconomic, project implementation and fiduciary risks, along with exogenous shocks that can only be partly mitigated in collaboration with the international donor community. 3.1. Governance Risks 108. The JPS-2 will be implemented in an environment with various governance risks. Governance factors, such as accountability and transparency in the management of public resources and challenges related to the political economy in the environment of projects, will be anticipated and built into project design. However, they cannot fully be mitigated. In preparation of the joint strategy, multi-stakeholder consultations have been conducted to enhance ownership. The consultations have confirmed overall agreement to the proposed approach and substance of the JPS-2 program. On the level of individual operations, both Banks have been assured of strong Government and other stakeholder ownership, and both Banks will continue to encourage constructive multi-stakeholder dialogue, transparency, and participation during program implementation in order to reduce governance risks and maximize development impacts. Internally, the Banks will apply their standard fiduciary and procurement safeguards and ensure that all projects build in governance mitigation measures for the intended development outcomes. Externally, in line with its mandatory Access to Information policy, the WB will proactively disseminate information to beneficiaries and other stakeholders to increase opportunities for citizen feedback. 109. Economic governance slippages and weak technical and managerial public sector capacity could compromise the most effective use of scarce public resources. The JPS-2 provides for the continuation of the policy dialogue of both Banks through a series of development policy operations (DPOs) to strengthen economic governance. Amongst others, the DPOs support improvements in public financial management and budget planning to enhance the quality of public spending and transparency. At the government level, the WB’s Integrated Financial Management Information System (IFMIS) project will support the Government in a more effective management of its resources, including through the progressive integration of donor-funded activities into the system. Together with other tools, IFMIS can thus serve as an instrument to help improve fiscal management and transparency and mitigate governance risks. A further extension of the scope and application of the IFMIS system will be encouraged. 110. Major policy reversals and other unexpected decisions also represent significant risks and have undermined confidence in the Government’s commitment to its international agreements. One recent example is the President’s intervention of October 2012 into the jurisdiction of the Central Bank in terms of determining the country’s monetary policy through the (temporary) introduction of a fixed exchange rate peg. This unexpected policy change exposed the risk of possible political capture of macroeconomic policy with significant undesirable implications37 and raised questions on the independence of the Central Bank and in the government’s commitment to the ECF Arrangement that it had signed with the IMF earlier in 2012. Had the peg not been removed quickly, and in consequence, the IMF program been declared off-track and even possibly suspended, the decision could have affected the approval of much needed budget support by both Banks in the near future. Another recent example of an unpredicted decision was the introduction of the four-day work week for the public service in January 2013. Implications of this decision still have to be observed. Both Banks will continue 28 working closely with the IMF to reach out to the government to highlight the inadvertent consequences of unanticipated decisions, and if need be, adjust the program accordingly. 3.2 Macroeconomic Risks 111. The Gambia is highly vulnerable to exogenous shocks, including commodity price volatility and the impact of the global economic slowdown. The main risk of the economy is erratic weather that cause crop failures either through droughts, as experienced in 2001/02 and 2011/12 that led to GDP contractions, and flooding, as experienced in more isolated areas of the country in 2012/13 and may again lead to crop failures at present and in. Interventions especially in agriculture will need to be designed for taking into account these risks, and identify appropriate mitigation measures and responses. 112. The ongoing global financial crisis presents considerable risks through secondary effects of the economic downturn on commodity prices and exports, reduced inflows from remittances and export services, and more restricted access to finance for both the public and private sectors. These downside risks are only partly mitigated by lower oil prices, as The Gambia is fully import dependent on oil. Other adverse external factors include the impact of external crisis or unfavorable climate conditions. The JPS-2, which will strengthen governance and improve the business environment, will help the country better deal with external and internal shocks. The Banks may consider reconfiguring the program in case of unexpected emergencies. The team will also consider tapping into new Crisis Response Window options, if available and necessary. 113. The domestic macroeconomic framework and policy conditions also represent significant risks for The Gambia. Public sector domestic debt, in particular, represents a significant risk to macroeconomic stability as (i) a high roll-over risk, since it is held entirely in short-term maturities (one-year or less) and (2) a risk to potential GDP growth through the crowding out domestic investment. Persistent, albeit recently shrinking, fiscal deficits also represent an important risk to growth outturns and public sector service delivery, as resources are diverted to debt and interest payments and by limiting fiscal space and the ability of the government to respond in the event of crises. Sudden and nontransparent shifts in monetary policy are disruptive to economic activity and undermine domestic and international confidence. 114. While the overall objective of the JPS-2 to support the Government’s efforts to address challenges in the areas of poverty reduction, job creation and growth will be affected by the impacts of the described external and internal risk factors, the proposed program contributes to at least partially mitigating these risks. Given the vulnerability to exogenous shocks and the volatile global environment, the IMF, IDA and AfDB will continue to closely monitor the government’s macroeconomic performance. To date, under the IMF ECF- supported program, has been satisfactory. The PFM reforms supported by the Banks’ budget support series and the IFMIS Project can also help enhance controls in executing the overall and sectoral budgets. 3.3 Program Implementation and Fiduciary Risks 115. Frequent and unpredictable turnovers of Government counterparts present another risk for program implementation. During the JAS-1 period, several Bank programs experienced frequent turnovers of Government officials, including at the ministerial level. The resulting 29 instability and uncertainty negatively affected program execution and undermined steady implementation. The risk of ongoing reshuffling is largely outside the control of the two Banks, except for two approaches: (i) to emphasize the importance of continuity for project implementation as part of the ongoing political dialogue, and (ii) to diversify and institutionalize implementation processes as much as possible to reduce dependence on individual counterparts. 116. Institutional and individual capacity weaknesses pose a risk to effective and timely project management, and to achieving results, which has in the recent past affected Borrower performance ratings of projects in Implementation Completion and Results Reports. Possible mitigation measures will, for example, include the option to embed an Immediate Response mechanism into new projects in case they are facing critical implementation delays. Further, implementation and fiduciary risks will be mitigated through intensive supervision from the Washington and Dakar Offices; such supervision will complement various capacity building activities (as part of the cross-cutting theme) to ensure substantial TA is provided to strengthen public institutions, including implementing agencies. The JPS program will be monitored on an annual basis and a formal JPS mid-term review will be conducted to assess progress and determine the need for any revisions to the scale and scope of the proposed programs. Also, the Banks will strengthen their strategic communication with country counterparts, including both Government and key non-governmental stakeholders and other donors. Nonetheless, the residual risk remains substantial. 30 Annex 1: JPS-2 Results Framework Country Development Goals Issues and Obstacles WB and AfDB Milestones from Interventions PAGE/MDGs JPS Pillar 1 – Enhancing productive capacity and competitiveness in order to strengthen resilience to external shocks AfDB PAGE Pillar I: - Insufficiently developed 1. Adoption of Diversified, - Livestock and Horticulture Accelerating Economic water management Production and Marketing of P. (L&HP) Growth systems Selected Agricultural Specifically: - Accessibility of farmers Commodities - Sustainable Land - Area of additional irrigation Strengthening the main to quality inputs, credit, Management P. - Number of additional households schemes built or rehabilitated sources of economic know-how and new engaged in food diversification for all year-round sustainable - Gambia Bridge growth (including technologies through small scale fruit and agricultural production - NERICA P. agriculture) vegetable production, and/or (500,000 hectares by 2015 - Sahel Resilience small animal husbandry. (25,000 from 0 in 2012). PAGE Pillar V: by June 2016 from 0 in 2012) - GAFSP Food Security - Volume of additional water Reinforcing Cross- - AfDB L&HP - stored in irrigation Cutting Interventions infrastructure built to increase WB Specifically: - Emergency Agriculture the irrigated area by 0.5 Food security Production million hectares (0.5 billion 2. Adoption of improved m3, by 2014). - WAAPP technologies in Agriculture - Number of additional - Agricultural water use and - Commercial Agriculture - Excessive post-harvest beneficiaries who have adopted management policy and and Rural Development loss technologies for enhanced strategy developed, validated Support agricultural productivity and and implemented. (by 2014). storage. (120,000 by June 2016 Number of additional from 0 in June 2012) – IDA improved technologies WAAPP - generated and disseminated. - Incremental percentage increase in horticulture sales (≥15% in June 2015, from 0% in September 2012 relative to baseline of GMD 3,644 in January 2011) – AfDB L&HP - 31 PAGE Pillar I: - Complex and 3. Improved Business WB Accelerating Economic expensive business Environment - Growth and Growth registration processes - Electronic business registry - Cost of registering a business developed in 2013 Competitiveness P. Specifically: Improving (<140% of GNI/capita by June competitiveness 2015, from 206.10% in September 2012) PAGE Pillar II: - Time-consuming 4. Improved Cross Border Transit AfDB Improving and border crossing across Time. Modernizing the Gambia river by - Construction of Trans- - Trans-Gambia Bridge - Reduced travel time across the Infrastructure ferry boat Gambia bridge Project Gambia River (from 79min in Specifically: Reforming - Cumbersome border- 2012 to < 30min by 2016) - Construction of One-Stop - Ancillary Study on the and Strengthening the crossing customs and Border Posts Trans-Gambia Bridge Transport Sector other procedures - Reduced waiting time at borders (from 4 hrs in 2012 to 2 hrs by 2016) PAGE Pillar II: 5. Improved Telecommunication/ - Implementation of Broadband Improving and - Slow internet penetration Internet connectivity Policy and Demand Modernizing - Weak - Volume of international traffic: Stimulation Strategy on track WB Infrastructure telecommunication, International Communications - West Africa Regional Specifically: Information specifically: internet, (Internet, Telecoms, and Data) Communication and communications connectivity bandwidth per person (kbit/per Infrastructure P technology person) (30kbit/person by December 2016, from 10kbit/person in September 2012) Volume of available international capacity: International Communications (Internet, Telecoms, and Data) bandwidth (Gbit/s) (5.9 Gbit/s by December 2016, from .16 in September 2012) 32 JPS Pillar 2 - Strengthening the Institutional Capacity for Economic Management and Public Service Delivery PAGE Pillar IV: - Weak capacity to 6. Improved Public Financial By December 2015, WB Improving Governance implement policy Management - Number of government - IFMIS - AF and Fighting - Insufficient laws and - Completion of public accounts offices outside of Banjul - Budget Support Corruption rules for transparency, reconciliation within 30 days of accessing and using IFMIS disclosure and access to the end of the month for at least 12 on EPICORE 9 (25 by end- - Public Accounts information months in a row by June 2016. - 2015) Committee TA (IDF) - Weak accountability IFMIS P. - - A revised Gambia Public mechanisms and systems AfDB - Time needed for Public Accounts Procurement (GPP) Act Committee’s completion of review submitted to the National - Institutional Support for of latest audit reports. (within 12 Assembly that separates the Economic and Financial months of receipt from the NAO policy and regulatory Governance II by June 2016, from >12 months in functions of GPPA (by end- - Budget Support 2011) - IFMIS P. - 2015) - Number of procurement - Extension of IFMIS to self- organizations compliant with the accounting (donor-funded) Gambia Public Procurement Act, projects. as reflected in annual Gambia - Enhanced payment system – Public Procurement Agency implement Electronic Funds report. (9 by end-2015, from 0 in Transfer (EFT) with Central 2012) - IFMIS P. - Bank of The Gambia - Budget framework paper submitted to Cabinet by June of each year which includes closer links between policies and proposed budget expenditure) - Establishment of an Independent Complaint Review Board 33 PAGE Pillar IV: Basic education: 7. Improved quality of learning WB Strengthening the - Low enrollment among outcomes for basic education � GERs in hard to reach - EFA-FTI Human Capital Stock hard to reach populations - % of teachers whose attendance is population - Low overall quality of - Third Education Phase 2 and Enhancing Access over 90% in 2016 by region, from to Social Services education - Basic Education 75% in 2012 (details on regional Specifically: Improving baseline and target values will be - CDD component access to education; available upon approval of new sanitation (of operation.) Commercial Agriculture & Rural - % of students reaching the Dev. P.) minimum literacy standard on grade 3 NAT reaches 43% in 2016, disaggregated by gender, from - Rapid Response Nutrition 36.7%, in 2012. Security Improvement - Community-based nutrition and health- PAGE Pillar IV: Nutrition & Health: 8. Improved nutrition and health care services (RBF) Strengthening the Human Capital Stock - Chronic maternal and services for women and children and Enhancing Access child mal-nutrition - Proportion of births assisted by - Use of Results-based to Social Services skilled personnel (65 percent by financing to increase service Specifically: Improving June 2016, from 57% in 2012) delivery by June 2014 access and quality of - Coverage of Primary health - Exclusive breastfeeding rate in the health services care and baby friendly first six months (i.e., proportion of children 0-6 months exclusively community initiatives PAGE Pillar V: reaching a minimum of 50% breastfed in the last 24 hours) (40 Reinforcing Cross- by June 2016 percent by June 2016, from 34% in Cutting Interventions 2012) Specifically: Nutrition - Prevalence of anemia in children under five (52% by June 2016, from 62% in 2012) 34 Annex 2: Overview on Full Proposed AfDB-IDA JPS-2 Program by Pillars JPS Pillars AfDB & WB Operations AAA WB AfDB WB AfDB Pillar 1: Ongoing Ongoing Proposed Proposed Enhancing Productive  Emergency  Livestock and  Multi-Sector Study  Ancillary Study on Capacity and Agriculture Horticulture Project on sources of the Trans-Gambia Competitiveness in Production Project  Sustainable Land Growth Bridge order to Strengthen (TF) Management Project Resilience to External  WA Agricultural  Trans-Gambia Shocks Productivity P. Bridge Project  Growth and  NERICA Project Competitiveness P.  Artisanal fisheries  WA Regional development project Communications Proposed Infrastructure P.  Sahel Resilience Proposed  GAFSP Food  Commercial Security Agriculture and Rural Development (CARDP) Pillar 2: Ongoing Ongoing Ongoing Strengthening the  Integrated Financial  Institutional Support  Improving Parental Institutional Capacity Management for Economic and Investment in for Economic Information System Financial children Governance and Public (IFMIS) Governance II  National Language Service Delivery  Third Education 2  GAFSP Food Pilot TA  EFA-FTI (TF) Security  Statistics TA  Rapid Response  PBSO Nutrition Security  Rural Water Supply Proposed Improvement (TF) & Sanitation Project  Energy sector  Integrated Bio-  Entrepreneurship analytical study Diversity promotion and (part of IFMIS-AF) Management P. microfinance  Public Accounts (TF)  PISP for economic Committee TA  Support to NGO and financial (IDF) network TANGO governance  Trade Logistics TA (TF)  Support to national -  IDF Civil Service water reform  HD Policy Dialogue Reform (TF)  Financial Sector TA  Teaching Math and Proposed (FIRST) Physics through e-  Budget Support  PPP Development learning (TF) TA (PPIAF)  Social Protection Proposed TA  IFMIS –AF  Budget Support  Education Sector Support  CDD component / CARDP  Community-based nutrition and health- care services (TF)  Governance (incl. private sector governance), Debt Management, PFM (tbd) 35 Annex 3: JAS Completion Report – FY08-11 THE REPUBLIC OF THE GAMBIA JAS COMPLETION REPORT FY08-11 Country: The Gambia Date of JAS 1: February 1, 2008 Period Covered by the JAS Completion Report: February 1, 2008 – December 31, 2011 ______________________________________________________________________________ I. INTRODUCTION 1.1 The purpose of this JAS Completion Report (CR) is to draw lessons from the design and implementation of the outgoing JAS (2008-2011) and to provide guidance for the design and implementation of the forthcoming JAS covering the period 2012-2015. The CR is also meant to serve as an accountability tool for the country teams in both institutions. This introduction presents a brief summary of the findings of the self-evaluation and the ratings under each component. Section II presents a review of the progress made towards achieving the main country goals; whereas Section III presents the highlights of the detailed evaluation of the outcomes of the strategy. Section IV presents an assessment of the performance of each institution; and finally Section V presents key lessons and suggestions for the forthcoming JAS (2012-2015). 1.2 The design of the 2008 JAS was aligned with the PRSP II, and focused on two pillars: (i) Strengthening the institutional framework for economic management and public service delivery, with three components including sub-components, and altogether nine outcomes, and (ii) Enhancing productive capacity and accelerating growth and competitiveness, with four components and additional eight outcomes. Pillar (i) was definitely the pillar with the stronger weight in terms of resource allocation, number of interventions, and attention throughout most of the JAS period (see details in Annex 3, Table (1), pp. 70ff). Following the JAS mid-term review in 2010 and as laid out in the 2010 JAS Progress Report, the JAS Results framework was somewhat straightened and adjusted to implementation reality, notably through the removal of sub-components and the dropping and/or replacement of outcomes (and related indicators) that were not relevant anymore, and the reduction in the number of outcomes from 17 to 14. 1.3 Progress towards the JAS (2008-2011) implementation has overall been moderately satisfactory as it achieved good progress toward all major expected outcomes. Under pillar (i) progress is rated overall satisfactory: Interventions by both Banks contributed towards macroeconomic and fiscal stabilization through budget support and the institutional support projects. Major achievements in this area included reforms in the legislative framework for budget management and public procurement and the rolling out of the Integrated Financial Management Information System (IFMIS) in January 2011. There has also been progress – albeit moderate – in the civil service reform and in strengthening the national statistical system and the audit function. Progress under pillar (ii) has been moderately satisfactory. The JAS contribution to improving the investment climate has been positive. Intervention for the improvement of crop productivity and increased output of fisheries has been impressive, particularly with respect of 36 groundnuts and rice, up to the onset of the 2011 Sahel drought. However, extension of credit to smallholder farmers for the financing of agricultural inputs has been confronted with managerial problems and low recovery rates, and access to financial resources by MSNEs has been limited. 1.4 Performance by both institutions in the design and implementation of the JAS has overall been satisfactory. In the design of the joint strategy, the two partners pursued strategic selectivity and complementarity in their respective interventions and both institutions have supported their respective interventions with joint and separate non-lending activities (AAA), which are of relevance to the portfolio in support of the JAS and both institutions have been proactive in adjusting the JAS to changing circumstances during the Progress Report exercise. Both institutions delivered both the lending and non-lending activities, with adjustments to the changing country circumstances during the JAS implementation. II. PROGRESS TOWARDS ACHIEVING COUNTRY LEVEL GOALS 2.1 The Gambia’s long-term strategic goals were articulated in its Vision 2020, which aimed “…to transform The Gambia into a financial center, a tourist paradise, a trading export oriented agricultural and manufacturing nation, thriving on free market policies and a vibrant private sector, sustained by a well-educated, skilled, healthy, self-reliant and enterprising population, guaranteeing a well-balanced ecosystem and a descent standard of living for all, under a system of government based on the consent of the citizenry�. The current Poverty Reduction Strategy Paper (PRSP II 2007-2011), which is the second in a series of PRSPs1, is based on Vision 2020 and on the Millennium Development Goals (MDGs). 2.2 PRSP II has five pillars: (i) Create an enabling policy environment to promote growth and poverty reduction; (ii) Enhance the capacity and output of productive sectors: agriculture, fisheries, industry, trade and tourism, with emphasis on productive capacities of the poor and vulnerable populations; (iii) Improve coverage of the basic social services and social protection needs of the poor and vulnerable; (iv) Enhance governance systems and build the capacity of local communities and civil society organizations (CSOs) to play an active role in economic growth and poverty reduction; and (v) Mainstreaming poverty related cross-cutting issues into poverty reduction. 2.3 The overall implementation of the PRSP II (2007-2011) has been mixed.  Regarding the first pillar, while the target for economic growth has been attained, fiscal deficit and mounting public indebtedness continue to pose a serious challenge. The policy and institutional reforms introduced since 2005 partly contributed to the relatively high GDP growth, which averaged a remarkable 6.2 percent during the period 2008-10 - despite the onset of the global financial crisis in 2008 - up from an average of 1.3 percent during the preceding 3 years. In 2011, however, the sources of growth in The Gambia shifted with the onset of the 2011/2012 drought, which led to a sharp contraction in crop 1 The first PRS covered the period 2003-2005. 37 production. The revival in tourism activity in the same year helped to partly offset the crop failure and was supported by The Gambian’s tourist industry capturing some of the shift in market shares due to the Arab Spring. Greater fiscal and monetary discipline contributed to maintaining consumer price inflation for 2011 at below 4.5 percent, down from 5.8 percent in 2010. However, fiscal deficit has been on the rise since 2008, reflecting both overspending and public revenue shortfalls. The basic fiscal balance 2 deteriorated from a surplus of about 3 percent of GDP in 2007 to a deficit estimated at 3.3 percent in 2010 and a projected deficit of 2.3 percent in 2012. The country continues to be debt-distressed 3 in spite of the HIPC relief since reaching Completion Point in December 2007 and the subsequent debt relief under the Multilateral Debt Relief Initiative (MDRI). The total debt outstanding as a ratio to GDP declined from 143.2 percent in 2006 (pre-HIPC) to 55.1 percent in 2008 but it increased again to 68.4 percent in 2011.  Regarding the second pillar, there are proof that indicate the productive capacities of vulnerable population, particularly smallholder farmers, has generally improved with favorable weather conditions and the pricing and marketing reforms within the groundnuts sub-sector and the introduction of improved rice (NERICA). The agricultural sector has witnessed substantial growth in recent years (until the onset of the 2011 drought) mainly due to favorable weather conditions and strong support by the development partners. Nevertheless it continues to be constrained by serious problems, which include: (i) accessibility of farmers to timely inputs and credit; (ii) increased agricultural productivity will be dependent on reducing the number of people currently (under) employed in agriculture, by generating more off-farm employment; (iii) weaknesses in forward linkages for creating value added through agro-processing; (iv) excessive losses in post-harvest handling and storage and adverse weather conditions.  Regarding the third pillar, the 2010 MDG Status Report concludes that there has been progress in the area of universal primary education, and in the ratio of girls to boys in primary, secondary and tertiary education. But there is still a wide gap between PRSP and MDG targets and the current status. The country’s health indicators remain relatively good compared with other Sub-Saharan Africa countries. Infant mortality rates and under-five mortality rates are at par with the best in the Region. There has been less progress in the under-5 mortality rate and insufficient progress in maternal health and in combating HIV/AIDS, Malaria and other diseases.  Under the fourth pillar, progress in enhancing governance systems and building capacity in local communities has been limited. 2 Source: IMF. Basic balance is defined as overall balance, excluding statistical discrepancy, less expenditure financed by project grants and external borrowing. 3 Thanks to improvements in its CPIA rating, The Gambia has been upgraded to a medium performer, with higher policy thresholds for the assessment of the sustainability of its debt. This, and the inclusion of re-exports, has resulted in a decrease in the risk of debt distress, from high to medium in 2012. 38  Under the fifth pillar, recent estimates (2011) indicate that poverty had declined substantially from 58.0 percent (using the US$1.00 a day poverty line) in 20034 to 48.4 percent (upper poverty line: US$1.25 a day)5. III. EVALUATION OF THE PROGRAM PERFORMANCE The JAS within The Gambia’s PRSP (2008-2011) 3.1 The joint strategy has had a positive contribution on the Government’s PRSP over 2008-2011. The major areas, where the two institutions had positive impact were in public finance management, agricultural development, basic education, health, and water and sanitation. The strategy’s objectives in developing the energy sector and in improving the business environment, however, have fallen short of the planned outcomes. 3.2 The JAS, through budgetary support, technical assistance, and project investments contributed to robust economic growth and stable macroeconomic economic environment, which prevailed during 2008-2011. The strategy in particular focused on improving financial transparency and accountability in the use of public resources through institutional reforms in the areas of budgeting, public revenue mobilization, public procurement, and civil service reform. The strategy also involved the implementation of IFMIS, which was completed by the end of 2011, and continued to provide staff training in the use of the system. Both institutions provided technical assistance and institutional support to bridge the eight years external auditing backlog existing in 2008 and have provided substantial capacity building in external and internal auditing. An important output of the strategy intervention was the preparation of a comprehensive PFM reform strategy (2010-2014), which is currently being up-dated. 3.3 The strategy also had substantial positive impact within the agricultural sector, which is estimated to have grown by an average 18 percent annually during most of the JAS period. Most of this growth has been partly attributable to favorable weather conditions and to policy and institutional reforms within the groundnuts sub-sector, which have been supported by the joint strategy. Direct project investments in the introduction and dissemination of NARICA rice, support of artisanal fisheries, and integrated rural development projects have substantially increased output of both cash and subsistence crops and has contributed to reduced poverty, improved health and nutritional standards. 3.4 Interventions by both institutions were expected to have contributed to improved public service delivery in education, health, water and sanitation, and the energy sector. Whereas achievements related to improved access to basic education were substantial, the impact of interventions within the health sector has been mainly related to improving nutritional 4 Estimations from 2003 Integrated Household Budget Survey (IHS). 5 Estimations from 2010 IHS jointly conducted by the Gambia Bureau of Statistics (GBoS) and the National Planning Commission (NPC), and facilitated by the United Nations Development Program (UNDP). The poverty headcount ratio was measured at US$ 1.25 and US$1.00 per day at purchasing power parity equivalent as a percentage of the Gambian population. 39 standards through support to the policy and strategic framework for nutrition and the provision of technical assistance for the strengthening of the National Nutrition Agency (NaNA). 3.5 The joint strategy has had negligible direct impact on the water and sanitation sector during 2008-2011, as there has been no direct project investment within the sector by either institution. With AfDB support, a technical study to assist in the formulation of a national water sector reform program has been initiated, and implementation of a new Rural Water Supply and Sanitation Project started by mid-2012. The initial outcomes related to improved effectiveness of the energy sector and respective indicators were dropped following the mid-term review, since investments and/or technical assistance by either partner have not come forward in view of financial and institutional weaknesses of the National Water and Electricity Company (NaWEC). The initial strategic approach was replaced by a modified new outcome, aiming foremost at reaching an agreement with the government on priority reforms needed. An Electricity Sector Reform Note has been prepared, and will be followed up under the new JPS. 3.6 The strategy’s objective of promoting a competitive investment climate has been achieved moderately, so far, and facilitating access to financial resources by SME’s has not been attained. The WB’s Doing Business Indicators reveal that the country’s ranking has actually deteriorated in recent years. The IDA Growth and Competitiveness Project (approved in late 2010) aims at improving investment climate and strengthen competitiveness in key sectors, with mixed results so far despite moving forward on a promising track. The Gambia component of the IDA West Africa Regional Communications Infrastructure Project has successfully connected The Gambia to the African Coast to Europe submarine communication cable. The AfDB regional The Gambia River Bridge Project will improve the country’s comparative advantage as a regional hub for transit trade and promote tourism. 3.7 The following is a more detailed review of progress made on the two JAS pillars. Pillar #1: Strengthening the Institutional Framework for Economic Management and Public Service Delivery 3.8 There were three components with initially nine and finally eight outcomes under the first pillar (one outcome, on provision of electricity, was dropped following the 2010 JAS mid-term review): (i) Improving the transparency and accountability in the use of public resources (three outcomes); (ii) Improving civil service (one outcome); and (iii) Improving public service delivery in education, health and sanitation, and rural electrification (initially five and finally four outcomes). Component #1: Improving Transparency and Accountability in the use of Public Resources 3. 9 Outcome #1 Strengthened public financial management. Overall progress under this 40 outcome has been partly achieved / moderately satisfactory6, as reflected in the findings of the 2010 Country Financial Accountability Assessment (CFAA), the 2011 Public Expenditure Review (PER) Update, and the improved CPIA ratings. With support from both Banks, the Government has been making strides in improving its public financial management and transparency, benefitting from major reforms, which included updating the legislative framework for budget management and public procurement including a Public Financial Management Reforms Comprehensive Strategy for the period of 2010 to 2014. One key achievement has been the establishment of an Integrated Financial Management Information System (IFMIS). This system has improved the timeliness of financial reporting by providing monthly and comprehensive within-year budget execution reports and facilitating the preparation of the annual financial statements.7 In particular, the IFMIS system has permitted the closer control of the status of budget execution and of spending levels; an enhanced management of ministerial resources due to the access to real time information on the status of their budgets; a strengthened sectoral allocation, planning, and analysis; and greater effectiveness in Government expenditure programs by identifying cost-drivers in program activities. An IFMIS interface at the Central Bank has been established, ensuring real-time information on budget financing shortfalls and on the timing of needed public domestic borrowing, and efforts are being made to regularize the Human Resource records of central government employees on the IFMIS payroll. Meanwhile, the Gambia has also reduced the backlog of audited Government financial statements 8 , established a Tax Tribunal, and strengthened the internal audit function. 3.10 Outcome #1: Strengthened Public Financial Management, the results have been very encouraging and are rated partly achieved/ moderately satisfactory, specifically due to the slow progress in the field of budget management. The Gambia Revenue Authority (GRA) implemented a three-year Strategic Plan (2008-2010) to up-grade staff performance and has set specific targets for tax collection and audit of large taxpayers. In 2009 GRA installed a new tax administration IT for processing large taxpayers. And GRA has now an activity based budgeting system in place that is linked to its mandate of collecting revenues. Further, a revised Customs and Excise Act was enacted in April 2010. The Customs regulations have been developed, with comments from extensive reviews waiting to be incorporated, at the time of the writing of this document. To improve public procurement, the government has up-dated the Action Plan (2011- 2016) to upgrade procurement practices agreed upon in the 2005 Country Procurement Issues Paper (CPIP) Action Plan. The first priority in this area is to separate the policy and regularity functions of the Gambia Public Procurement Authority (GPPA). Progress on the Action Plan, however, has been slow in view of capacity and financial constraints. 3.11 Progress on budget management has been mixed: Semi-annual fiscal budget reports and monthly budget outturns are being published since 2010 and these have recently being integrated into IFMIS. Key PRSP public expenditures (education, health & social welfare) have since 2008 6 The rating of outcomes follows both WB and AfDB rules: Whereas the WB rules allow for 4 categories of outcome ratings (achieved, partially achieved, not achieved, and not observable), AfDB ratings are covering a 6 point scale (highly satisfactory, satisfactory, moderately satisfactory, moderately unsatisfactory, unsatisfactory and highly unsatisfactory). 7 The IFMIS currently produces in-year fiscal reports with an average lag of one month and reconciles most banking and fiscal records also on a monthly basis. 8 The Government financial statements for 2008, 2009, and 2010 have been submitted to the National Audit Office. 41 been in line with the planned targets. However, there were considerable deviations in critical sectors relevant for the country’s development agenda – ranging from 9 percent (forestry) to 47 percent (energy) - between initial allocations and actual expenditure for 2011, which is clearly not satisfactory. A comprehensive MTEF is now anticipated to be introduced by 2013. The government has requested technical assistance from the IMF in this regard. 3.12 The main instrument of support towards attaining this outcome has been the two budget support operations9 , which supported policy and institutional reforms in macroeconomic and public finance management, civil service reform, and the groundnuts sub-sector. The two institutional support operations: IDA’s CBEMP and AfDB’s ISPEFG were designed to complement the budget support programs and covered the same areas of coverage as the budget support. The former has mainly supported the establishment and initial roll-out of IFMIS; whereas the latter has provided technical assistance for the drawing up of the Public Financial Management Reforms Comprehensive Strategy (2010-14). Non-lending operations by both Banks also contributed towards attaining the outcomes. These included the CFAA exercise (WB/AfDB and DFID) and the WB’s: Poverty Assessment Study, PER, procurement support TA, and Anti-money Laundering. 3.13 The sustainability of the gains attained under this category is at risk, however. This is particularly so in the case of IFMIS, whose sustainability would require further development, maintenance and capacity building. To mitigate such risk the government has prepared an IFMIS Sustainability Plan, and the needed costs were included in the 2009-2011 budget. A Follow-up IDA IFMIS grant (US$ 5.2 million) was approved in June 2010, and an Additional Financing will be included into the upcoming new JPS. 3.14 Outcome #2: Strengthened National Statistics System: The main objective of support is to build capacity to process and disseminate key findings from national surveys within one year of data collection. Progress towards this goal has been partly achieved / moderately satisfactory. Most of the support in this area has been through the WB’s CBEMP and technical assistance to the Gambia Bureau of Statistics (GBOS), which supported the transformation of the previous Central Statistics Department into the GBOS, with greater autonomy. The national accounts data based on a new methodology were disseminated using IFMIS and NAO web-based information system by end-2009. Financial reporting by GBOS has also improved with the broad application of IFMIS and the monthly publication of the cost price indices. There is little progress, however, in the timely publication (within one year of data collection) of data, specifically national surveys, on the GBOS’s web-site; the results of the 2010 Integrated Household Survey have been made publicly available through the GBOS website only in early 2012. 3.15 Outcome #3: Strengthened Audit Function: Progress in strengthening audit has been partly achieved / moderately satisfactory. The 8-year backlog of unaudited public accounts, which existed in 2008, was cleared, which is a huge accomplishment. But the timing of production and dissemination of audit reports has still not fully met the expectations: Government Financial Statements from 2008-2010 were submitted to the National Audit Office 9 IDA’s “Public Sector Reform and Growth Grant� and AfDB’s “Poverty Reduction Budget Support.� 42 for auditing only in May/June 2012, which exceeds the benchmark of one year following the end of the respective fiscal year. The 2011 Statements have been submitted on 20th December 2012. The AfDB’s ISPEFG was the main vehicle of support in capacity building since 2009; the recently approved ISPEFG II involves capacity building and institutional strengthening in internal and external audit. Component #2 Improving Civil Service 3.16 Outcome #4: Enhanced HR Management Policy and Tools used In Public Administration: The planned outcome involves the establishment and use of an enhanced human resources management policy and tools in public administration. Performance under this component has overall been partially achieved / moderately satisfactory. A joint WB, AfDB and DfID study on Civil Service Reform formed the basis of the formulation of the government’s 2008-2011 Civil Service Reform Strategy, approved by the Cabinet in mid-2009. The strategy envisages key reforms related to civil service salaries and performance evaluation systems. In implementing the strategy, the government increased civil service salaries by about 40 percent over 2008-09, which has helped in attracting and retaining competent staff at the higher levels of government. In order to facilitate decision-making, a Pay and Employment Model (basically a sensitivity analysis on the immediate fiscal impacts of the changes in pay and employment structures) was prepared with support from the WB. The full success of the measure, however, has been constrained by the reduced fiscal space available to government to apply the originally designed pay reform (increase of 68 percent). Integration of the HR information system with the payroll is ongoing. An Institutional Development Fund for Civil Service Reform grant was made available during the JAS period to support key components in the government’s long term Civil Service Reform agenda, specifically in the areas of strengthening the capacity for human resources management, wage bill and pension management. Development of an effective performance appraisal tools is in the final stages, and will be piloted in The Ministries of Tourism, and Youth & Sports. Further activities are ongoing and include the addition of an HR Module in IFMIS to improve budget reporting, which is currently envisaged as one of the new activities to be financed under IFMIS AF. Component #3: Improving Public Service Delivery in Education, Health and Sanitation and Rural Electrification (a) Education 3.17 Outcome # 5: Increased Primary Enrollment: Performance towards increased primary enrollment has been partially achieved/moderately satisfactory with the objectives for the JAS period. The Gross Enrollment Rate (GER) for lower basic education increased considerably and has reached 90 percent in 2012 (including certified madrassas following the regular curriculum). Gender parity has been met at both the lower basic and upper basic levels - helped by construction and rehabilitation of classrooms, separate latrines, as well as scholarships for needy girls provided under the IDA and EFA-FTI (Education for All – Fast Track Initiative, now: Global Program for Education, GPE) projects. Issues of hard to reach populations need to be given focused attention during the implementation of the upcoming JPS. The JAS indicator target of 100 percent primary enrollment, however, was not achieved. 43 3.18 Outcome #6 Increased Quality of Education: Expected progress has been partly achieved / moderately satisfactory: Internal efficiency is quite good in comparison with other countries, with a primary completion rate of 72 percent which is exceeding the JAS target of 68 percent for the primary completion rate. However the target of 30 percent of beneficiaries of the in-service training program to obtain credits in English and math could not be achieved. Among the total of 2,730 beneficiaries, only about 20 percent, i.e. 484, took the English, and only 5 percent, i.e. 140) the Math WASSCE, respectively, in September 2012. The results are expected in February 2013, but even in the best of all possible cases, the target of 30 percent will not be achieved. 3.19 The WB support of basic education has been through the Third Education Project (Phase 2) complemented by PHRD co-financing and Additional Financing. The latter introduced interventions on higher education and teachers training. Further, the WB has also contributed to improved enrollment and quality of primary education through supervision of the Education for All-Fast Track Initiative project and various non-lending operations. The AfDB supported the sector through a Basic Education Project, which was completed in June 2010. (b) Health 3.20 Outcome #7: Strengthened Policy Framework for Nutrition Programs: The original planned outcome: “Increased number of households with access to basic health services.� was replaced at mid-point by: “Strengthened policy framework for nutritional programs.� Expected progress towards this outcome has been achieved / satisfactory: A new Nutritional Policy (2010-2020) has been formulated and validated in January 2011 and a costed Strategic Plan for Nutrition (2011-2015) has been elaborated. The policy and strategic plan have been presented in early 2012. There has been little direct support to the general health sector by both the AfDB and the WB. The AfDB Health Services Development Project was completed in 2007. The project may have had an impact, but it is not feasible to gauge it. The WB’s CDDP has financed 4-5 health sub-projects; but health projects generally have not been selected by the beneficiary communities in this demand-driven project. The health sector may also have benefited indirectly from the budget support operations provided by both the WB and the AfDB 10 . To improve nutritional standards the WB approved in September 2010, the Rapid Response Nutrition Security Improvement Project, alongside a two year complementary Technical Assistance intervention to strengthen the National Nutrition Agency’s (NaNA) capacity to improve nutrition outcomes (December 2009). (c) Water and Sanitation 3.21 Outcome #8: Increased access to Water and Sanitation: The original planned outcome “Increased number of water and sanitation connections in the Greater Banjul Area (GBA was recast and replaced by “Increased access to water and sanitation�, following the 2010 JAS mid- 10 Of the AfDB’s UA 4.0 million budget support operation, approved in 2009, one million was from the Africa Food Crisis Response (AFCR). 44 term review, with a view to monitor progress of new connections across the whole country, rather than focusing exclusively on the GBA. There has been no direct investment in the sector by either institution during the JAS period. Hence, the achievement of the target towards this outcome, of more than 100,000 people benefitting from additional water and sanitation connections, as established in the JAS Progress Report, cannot be observed. The AfDB in preparation for future operations within the sector approved in 2010 a National Water Sector Reform Study to support the formulation of a National Water Sector Reform Program. Further progress in this regard is anticipated through the currently ongoing AfDB Water Supply and Sanitation Project11, approved in February 2012. (d) Provision of Electricity 3.22 Outcome #9: Increased number of Households with access to electricity in targeted areas: The original planned outcome towards this goal was: “Increased number of households with access to electricity in targeted areas, and cannot be observed, since envisaged interventions towards this objective did not materialize. Following the mid-term review, new outcomes for energy sector support were included under pillar 2. JAS Pillar (2): Enhancing Productive Capacity and Accelerating Growth and Competitiveness. 3.23 The second pillar under the original JAS involved four components and eight planned outcomes. The four original components were: (i) Promoting a Competitive Investment Climate/Growth and Competitiveness (3 outcomes); (ii) Facilitating Access to Financial Resources by MSMEs; (one outcome); (iii) Strengthening the Agricultural Sector (two outcomes); and (iv) enabling the environment of the Energy Sector (two outcomes). Following the mid-term review, three of the original components remained the same; the third component, however, has been expanded to read: “Strengthening the Agricultural Sector and Rural Development.� The number of expected outcomes was reduced from eight to four with three of the four original outcomes being reformulated. Pillar (2) has proven to be more difficult to assess than pillar (1) in view of the lack of available baseline information and data collection problems, except for agriculture. Thus, assessment at the end of the JAS period is based on general trends. In cases where the linkage between the planned outcomes and outputs is weak, changes have been introduced in the outcomes. Component #1: Promoting a Competitive Investment Climate/Growth and Competitiveness 3.24 Outcome #10: The three original planned outcomes: “Increased number of tourists,� “increased volume of agribusiness exports,� and “increased credit to private sector,� were replaced by a single outcome: “Improved business climate� because of lack of credible indicators, measured by revised indicators, i.e.“monetary value of new private investment 11 AfDB UA 1.1 million, plus Euro 4.0 million from the Rural Water and Supply & Sanitation Initiative. 45 attracted in JAS period through GIPFZA12 (since 2008)� with a target value of US$55 million, and “Time and cost of new company registration� (targets: 20 days at cost of not more than 190 percent of per capita income, down from 215 percent at mid-term). Program performance overall is promising and progress is partially been achieved/moderately satisfactory. Progress in terms of value of new private investment (actual investments) through GIEPA has surpassed the target: In addition to investments of US$ 30 million in 200813, GIEPA received in 2010 seven new private sector investment proposals with a total proposed investment value of about US$ 30.4 million14. Corresponding figures for 2011 were 13 investment proposals the value of which stood at US$ 60.0 million. The 2013 Doing Business Report indicators, however, show that the time required for registering a business was still 27 days, in contrast to 34 days for sub-Sahara Africa, whereas the cost of business registration (158.7 percent of per capita income) by far exceeded that of sub-Sahara (67.3 percent), but still met the very conservative target value. Doing Business Indicators depict that the country’s rank for doing business has slightly improved from 149 in 2012 to 147 in 2013. 3.25 In support of this component the WB approved in September 2010 the Growth and Competitiveness Project with its primary objective to improve investment climate and strengthen competitiveness of key sectors in the economy. The project involves improving business environment through business registration and tax administration reforms and the strengthening of MSMEs through access to finance, marketing, and skills promotion in key sectors of the economy (horticulture, groundnuts, tourism, etc.). In addition, the WB implemented a small Trust Fund operation to create small enterprises for the development and distribution of fuel efficient stoves and biomass briquettes. 3.26 Two other regional operations were approved, one by the WB and the other by the AfDB, which will have a positive impact on economic growth and competitiveness, in the long run. The IDA-funded West Africa Regional Communications Infrastructure (approved in March 2011) aims at connecting 23 countries to the Africa Coast to Europe submarine cable, and has established a landing station with private sector involvement in The Gambia. The AfDB combined resources from the regional allocation and the ADF for the financing of “Gambia River Bridge Project� (approved in September 2011). The bridge constitutes the key component for the Trans-Gambia Road Transport Corridor, which is an economic and strategic link connecting the northern and southern parts of both The Gambia and Senegal, and with this, other ECOWAS countries through the corridor between Dakar and Lagos. The AfDB’s planned “Private Sector Profile Study� has not been undertaken. Component (2) Facilitating Access to Financial Resources by SMEs 3.27 Outcome #11: The original outcome: “Improved access to finance� has been reformulated to: “Improved access to finance for MSMEs� and the indicator has been changed 12 The Gambia Investment Promotion and Free Zones Agency (GIPFZA) has been replaced by the Gambia Investment and Exports Agency (GIEPA). 13 GIEPA operations were temporarily suspended in 2009 because of institutional changes. 14 Not including an exceptionally high investment proposal of US$ 450 million. 46 to: “Number of (direct) clients served through microfinance components of EPMDP and IFC support� with a target of 10,000. Overall, expected results have not been achieved, and progress has been unsatisfactory as there has been limited progress in microfinance and almost no progress at all in SME finance. The AfDB’s Entrepreneurship Promotion and Microfinance Development Project (EPMDP) over 2009-2011 extended about GMD2 million15 to 567 small- holders for the financing of agricultural inputs. The IFC aims to improve access to finance through microfinance institutions and trade finance through local banks. Estimates by the Central Bank put the number of microfinance clients at the end of 2009 at 158,000, compared to 144,500 at the end of 2008 and 129,000 at the end of 2007, but attribution to IFC interventions could not be established. Total loans outstanding increased from GMD 233 million at end of 2007 to GMD 271 million at end of 2009. Component (3) Strengthening the Agricultural & Rural Development Sector. 3.28 Outcome #12: The original outcome: “Improved productivity of crops, livestock, and forestry� has been recast to: “Improved productivity of crops and livestock production and fishery.� Progress under this outcome has overall been achieved/ satisfactory to the most part, mainly due to the strong support to the sector by both Banks and the good weather conditions which prevailed during the period under review until the onset of the 2011 Sahel drought. Groundnuts output increased from 110,000 MT in 2008 to 122,000 MT and 138,000 MT in the subsequent two years. Paddy rice over the same period increased from 11,400 MT in 2008 to 61,000 MT in 2010. Rice has benefited from the widespread adoption by farmers of the new NARICA variety, introduced through the AfDB’s regional NARICA Rice Development Project. Groundnuts also benefited from the marketing and pricing policy reforms of the two budget support operations and by IDA’s Gateway Project. There has been, however, limited progress in the livestock and forestry improvements to date. Fish output increased from 46,000 tons to about 50,000 tons over 2008-2010. The AfDB in 2009 approved an NTF supplementary Artisanal Fisheries Development Project16, which involved improvement of fisheries infrastructure and facilities; strengthening of the fisheries department; monitoring and control and a credit program. 3.29 The AfDB had seven ongoing agricultural operations at the start of the JAS in 2008: (i) Farmer Managed Rice; (ii) NERICA Dissemination;(iii) Peri-Urban Agricultural Development; (iv) Artisanal Fisheries Development; (v) Participatory Integrated Water Shed; (vi) Entrepreneurship Promotion & Microfinance; and (vii) Community Skills Improvement. Of these seven operations, only the Supplementary Artisanal Fisheries Development and NARICA Dissemination are still on-going. Two new projects were approved during the JAS period; these are: The Livestock and Horticulture Development Project and the Sustainable Land Management Project. The IDA portfolio had one ongoing operation covering rural development including the agricultural sector at the start of the JAS, the CDDP. Three new projects were approved by the WB in the course of the JAS: The West Africa Agricultural Productivity Program complements AfDB’s NERICA Rice Project through the establishment of regional centers of excellence in agricultural research centered on new crop varieties and regional dissemination of new 15 Equivalent to about US$ 68,000, at the exchange rate prevailing in November 2011. 16 The original project was financed by an NTF Loan (UA 2.5 million), approved in 2000. 47 technologies. The Gambia Emergency Agriculture Production Project was approved in January 2010 with resources from the Global Food Crisis Response Trust Fund. Its main objective was to improve access to agricultural inputs, equipment, and postharvest storage capacity by targeted farmers. Outputs by far surpassed the envisaged targets by far: As to WB project monitoring reports, more than 60,000 farmers had received improved seeds and recommended fertilizer by early 2011 (as compared to the initial target of 20,000), and 870 farmer groups received farm machineries (as compared to 667 initially expected). The number of beneficiaries of pesticide distribution could not be established. The GEF-funded Integrated Biodiversity Management Project was approved in December 2010. Its main objective was in support of the MDG environmental sustainability goal. 3.30 Outcome #13: Improved prevention and locust early waning reaction: Progress in improving prevention and early warning of locusts’ infestations has been achieved/ satisfactory, as the WB’s regional Locust Project established facilities, which reduced response time from 30 to an estimated one day. Component (4): Enabling the Environment for Development of the Energy Sector. 3.31 Outcome # 14: Intervention for reform of Electricity Sector agreed with Government. This outcome has replaced the original two outcomes: “Secure funding for investments identified in new Electricity Master Plan� and “PURA applies new tariff�. Progress under this outcome has been moderately unsatisfactory. Private sector investments within the electricity sector have not materialized mainly due to concerns related to the effectiveness and efficiency of the National Water and Electricity Company (NAWEC) and its lack of ability to undertake much needed internal reforms, and to assure revenues needed for investments aimed at reducing transmission and distribution losses. IV. INSTITUTIONAL PERFORMANCE Design of the Strategy 4.1 The strategy design has been satisfactory as it focused narrowly on two of the five pillars of the PRSP II: (i) strengthening the institutional framework for economic management and public service delivery, and (ii) enhancing productive capacity and accelerating growth and competitiveness. Given IDA’s and AfDB’s concessional resource constraint, as well as the country’s limited absorptive capacity, the original JAS program focused on mainly four areas17: (i) policy reforms and institutional support; (ii) agriculture and rural development; (iii) water and sanitation; and (iv) private sector development. In this respect the JAS avoided committing fresh funds, where other development partners were already engaged, or where there are on-going operations, such as health, nutrition, telecommunication, power generation, and transport. 4.2 In selecting the areas of engagement and instruments, the strategy addressed priority needs for promoting sustainable poverty-alleviation growth. The first pillar was 17 Excluding on-going operations prior to 2008. 48 relevant to the PRSP II so as to prepare the way for sustainable growth; it also complemented the IMF’s efforts in restoring macroeconomic stability and laid the foundations for improved financial management. The first pillar also included operations (mostly ongoing) to improve public service delivery in health, education and water and sanitation standards. 4.3 The second pillar is also relevant to the country’s PRSP II as it focused on accelerating poverty-reduction growth through enhancing agricultural yields and improving the business environment. The second pillar complemented the first pillar as it addressed issues related to poverty alleviation through improved accessibility to credit for micro, small, and medium enterprises (MSMEs). 4.4 The JAS recognized that some of the outcome indicators do not exist and used milestones and other general indicators as proxy to outcomes. Some outcome indicators had to be reformulated following the JAS mid-term review, because of little direct support in the respective sectors. 4.5 Several of the identified critical risks have materialized. The risk pertaining to the vulnerability of the economy to external shocks has materialized by the sharp increase in the prices of food and energy in the 1980s, and subsequently by the global financial crisis, which adversely affected tourism and remittances. The risk relating to the deterioration of the macroeconomic position has also materialized in view of the increased public expenditure, increased domestic borrowing, and the relative decline in public revenues (2.4-2.5). Risks relating to governance, shortage in absorptive capacity and relatively week project implementation continue to pose risks to sustained growth and development. 4.6 Both banks have been proactive in adjusting the JAS to changing circumstances and priorities. The AfDB responded to the sharp increase in food and fuel prices in 2008 by increasing the amount it had allocated for budget support (US $ 4.5 million) by 30percent to help the country in absorbing the increase in the international prices of food and fuel. Also in response to the food crisis, the AfDB restructured two ongoing agricultural operations18 with the objective of increasing food production. At the request of the government, the AfDB has also financed the Gambia Bridge Project (Regional). The WB, in reacting to the potential adverse impact of food shortages approved the Emergency Agricultural Development Project. Following the mid-term review, the WB shifted emphasis from the general health sector to improving nutrition security. In this respect the WB initiated a Rapid Social Response Operation on nutrition and complemented it with a Technical Assistance project. The AfDB opted to assist the country in the formulation of a national water sector reform program prior to investment in the sector. The outcome matrix following the mid-term review has been adjusted to reflect changing circumstances. The changes involved the reduction in the number of the planned outcomes from seventeen to thirteen and the adjustment in four of the remaining outcomes. 18 Farmer Managed Rice Irrigation Project and NARICA Rice Development Project 49 Program Implementation 4.7 The Banks’ overall program implementation has been satisfactory. Both Banks have delivered the planned lending and non-lending activities although there have been some modifications to adapt to changing country conditions and needs. In terms of analytical and advisory activities (AAA), the following activities were delivered: (i) in support of strengthened public financial management the following activities were undertaken: (i) the CFAA exercise (AfDB/WB/DFID); (ii) Public Expenditure Review (WB); (iii) Procurement Support TA (WB); (iv) ROSC with focus on auditing and accounting; (v) Poverty Assessment. In the area of Civil Service Reform the following studies and TA were provided: (i) Civil Service Reform Study (AfDB/WB/DFID); (ii) Pay and Employment Model (WB); (ii) in support of governance the AfDB carried out a Governance Profile and a Gender Profile, whereas the WB provided TA in Anti-Money Laundering. In support of the national statistical system the WB provided TA for the Transformation of the Central Statistics Department into GBOS. In support of its portfolio in the education sector the WB undertook the following: (i) Multi-Grade Reading Initiative; (ii) Reaching out-of-school children & Building Skills for youth Employment Study; (iii) Education Country Status Report Light; (iii) in support of its operations within the health sector, the WB provided TA for the National Nutrition Agency (NaNA) and in support of the agricultural sector it carried out a CDDP Impact Evaluation and an Agricultural Sector Policy Note. Within the infrastructure sector, the AfDB financed the Banjul Port Design Study. 4.8 The above studies and TA work were of immediate relevance to the development process of the Gambia and contributed to the policy design of the JAS and to individual project design. Most of the work has been carried out by professional and specialized staff and thus are generally of credible quality. The reports were disseminated widely. Most of these reports were posted on the respective web-sites (AfDB/WB/Government). The following are planned to be posted in GBOS’ web-site shortly: Integrated Household Budget Survey (2010); the Poverty Profile; the Multiple Indicators Cluster Survey, the Malaria Survey, and the Information Communication Technology Survey. Cooperation between the AfDB and WB within the JAS Context: 4.09 Cooperation between the AfDB and the WB within the context of the JAS has been successful. The first AfDB/WB JAS (2008-2011) was initiated in response to the need for harmonizing development assistance in The Gambia in line with the Paris Declaration on Aid Effectiveness. It was an attempt by both institutions to align their strategies and programs and optimize their respective technical expertise. The partnership between the two institutions resulted in complementarity and synergy through their lending and non-lending operations (AAA). Both institutions supported policy and institutional reforms in the area of public finance management. Whereas the AfDB focused on tax revenues, public audit, increased budgetary allocations for poverty related aspects, the WB focused on improved budgeting, civil service reform and price and marketing reforms in the groundnuts subsector. 4.10 In the area of technical assistance and institutional support, the AfDB focused on macroeconomic and public finance management, whereas the WB focused on capacity building in IFMIS. Intervention through institutional support and technical assistance provided 50 synergy to the policy and institutional reforms supported through the budget support operations by both institutions, particularly in the area of public audit, macroeconomic modeling, financial budgeting and planning and accounting for PRSP expenditures. 4.11 There is a general consensus amongst the country teams in both institutions that the first JAS exercise has been an effective tool for coordinating strategies and streamlining the lending and non- lending programs and activities, but there is still room to improve upon the process. The consensus was that there has been very useful collaboration in the budget support process, as there is an already established institutional process for that purpose. Similarly the collaboration was very effective in the education sector, where the government plays the leading role in coordinating development partners’ intervention. Discussion amongst country teams has concluded that there is a need for a mechanism for closer collaboration - at the country team level - in other major sectors of focus such as agriculture, regional integration, infrastructure, and energy. This is particularly so in view of the relatively weak government- donor development coordination in the field. Cooperation between the two institutions in The Gambia was further consolidated by the joint portfolio review exercise undertaken in 2011. 4.12 Efforts by the WB and AfDB to attract more development partners into the JAS process have failed. However, donor coordination in general has been strengthened within the overall context of budget support. The Gambia General Budget Support Program (GBSP) has been jointly designed and monitored by the government, the AfDB, the WB and the European Union (despite the latter not being a party to the JAS). A draft MOU outlining the modalities for implementing and monitoring the program has been developed and a Joint Policy Reform Matrix has also been developed. Semi-annual joint reviews of progress in the policy framework have been undertaken. Notwithstanding these positive developments, the government’s lead role in donor coordination remains weak because of capacity constraints - despite several efforts by the JAS partners to strengthen the Aid Coordinating Agency in the Ministry of Finance and Economic Affairs. 4.13 Joint Monitoring and Evaluation: The JAS outcome matrix provides a good framework for the contribution of each institution to the development effort of The Gambia. However, there is a need to improve upon the choice and quantitative indicators for the planned outcomes. The mid-term review is another important tool of the joint M&E process. In addition, both institutions take advantage of the semi-annual budget support review meetings, held semi- annually in Banjul, to review progress in the implementation of the JAS and streamline their respective programs. There is a need, however, to link more closely the JAS implementation monitoring system to the Government’s PRSP monitoring. Assessment of Country Capacity in Project Implementation 4.14 Capacity Development: The Civil Service Reform Study, which was jointly financed by both institutions (AAA) and which was finalized in 2009 concluded the following: (i) the size of the civil service and the wage bill were relatively reasonable compared to similar countries. (ii) Staff composition emerged as a critical issue, mainly in view of the loss in upper grade staffs: it has been estimated that the period 2003-2007 witnessed a 14 percent decline in managerial staff (grades 11-12), whereas senior staff (grades 9-10) and junior staff have declined by 39 percent, 51 and 5 percent respectively, whereas the semi-skilled and unskilled (grades 1-3) have increased by 31 percent. (iii) A major cause of staff attrition has been the low salaries and benefits. (iv) Human resource management has been accorded low priority. Efforts by both institutions during JAS-1 has been focused on building capacity in the areas of macroeconomic management, budgeting, public finance management, external and internal audit use and maintenance of IFMIS and in national accounts and CPI (3.14-3.16). The forthcoming JAS will continue to focus in public finance management areas, including MTEF, audit, and IFMIS. 4.15 The Joint AfDB/WB/GoTG Country Portfolio Performance Review undertaken in April 2011 has concluded that project implementation continues to be weak. Some of the major factors, which contribute to weak implementation include: (i) inadequate funding of counterpart funding of development projects; (ii) prolonged administrative delays in processing duty-waivers for project goods and activities; (iii) weak capacity of PIU staff in the areas of procurement, monitoring and evaluation; (iv) weak communication between the Banks and the coordinating agency in the Ministry of Finance and Economic Development and the PIUs. V. KEY LESSONS AND SUGGESTIONS FOR THE NEW JPS Key Lessons Learned 5.1 The undertaking of this AfDB/WB JAS-1 completion report is a step forward in the cooperation between the two institutions, but more needs to done to harmonize the processing in both institutions for joint JAS. The processing of this Completion Report has been faced with difficulties because of lack of procedures specifically laid out for a Joint Partnership strategy completion reports. Further problems were encountered because of inadequate budgeting on the part of the AfDB associated with direct hire. 5.2 The role of the AfDB’s country team and the review process of the design and program assessment of country strategies need to be revisited. There has been very little interaction between the sectoral departments and the country program department, beyond country team meetings. Thus, there may arise a risk of disconnect between the strategy process and the programming process. It is therefore suggested that management of the AfDB should revisit the design of country strategy process to strengthen the link between the strategy and country programming. 5.3 Collaboration with other Development Partners needs to be further improved. Other major development partners, who were active during the JAS period, include the IMF, the EU, DFID, IsDB, UNDP, and Japan. The IMF has mainly provided TA in the area of revenue mobilization, national accounts, and CPI data. DFID has been active in the area of TA in financial management and poverty alleviation. The EU has supported poverty alleviation through food security and income generation, decentralization, infrastructure development, energy and agriculture and rural development. The UNDP has been active in governance reforms, poverty alleviation, decentralization, and education. The IsDB invested in health, education and infrastructure; whereas Japan has supported operations within the education, agricultural and rural development. Attempts to draw other development partners into the JAS partnership have not been successful, as most of the bilateral partners insisted on following their own procedures. 52 5.4 There is need to improve upon the programming aspect of the JAS at the design phase. The planned JAS program for the AfDB was UA 15.00 million, whereas actual commitments stood at UA 89.28 million – a six folds increase. Similarly the WB planned JAS program amounted to US$ 20.25 million, whereas actual commitments stood at US$ 98.21 million – 5.6 times more than the planned amount. Most of the increase in both institutions was due to inclusion of projects, which were not factored in during the JAS design phase and which were financed from multinational allocations or from special accounts. Attempts should be made to factor in “potential projects� at the JPS design phase for regional projects and special accounts and to ensure that the proposed projects are consistent with the strategy. 5.5 A lesson learned from the mid-term review is the need to improve upon the quality of the outcome matrix by identifying appropriate outcomes, which can be quantified, and for which baseline data exist. Difficulties in this area were evident during the mid-term review, following which the number of outcomes was reduced from seventeen to thirteen and adjustments incorporated in four of the retained thirteen outcomes. Recommendations for the Forthcoming JPS (2012-2015) 5.6 The two pillars of the 2008-2011 JAS continue to be consistent with the Government’s PAGE (2012-2015). The first JAS pillar corresponds to pillars (iii) and (v) of PAGE, whereas the second pillar of JAS corresponds to pillars (i), (ii), and (v). Thus, based on the PAGE and the need to consolidate the gains attained under JAS 2008-2011, it is proposed that the forthcoming JPS 2012-2015 should maintain Pillar I of JAS-1. Focus under component #1 should be geared to support the major policy reforms in the next budget support program. Potential outcomes under component #1 may include revising and updating the current PFM program (2010-2014), measures to improve domestic resource mobilization, including tax reforms (replacement of the current sales tax with VAT), public procurement reform, and the introduction of a three-year MTEF rolling program, adequate budget allocations for the maintenance and capacity building of IFMIS, consistent with the government’s IFMIS Sustainability Plan. 5.7 The on-going institutional support and technical assistance operations (AfDB’s ISPEFG II and IDA’s IFMIS project) complement the policy and institutional reform agenda. Any fresh commitments of funds should be devoted to building capacity in PFM monitoring and evaluation, internal and external audit, design and implementation of MTEF. The forthcoming JPS should also consider pursuing further the civil service reform (component #2) through the application of the enhanced human resources management policy and tools in public administration. Public service delivery (Component #3) should continue to focus on basic education, and water and sanitation. 5.8 The components under pillar II of the 2008-2011 JAS need to be reformulated to be more strategically focused, yet catering for the investments introduced in infrastructure and 53 regional development19. Components 1 and 2 could be revisited and/or collapsed. The focus of pillar II, however, should be on the agricultural sector and rural development (Component 3), where the strategy should be on poverty alleviation and improved food security. The success of the JAS within the agricultural sector should be consolidated with further appropriate intervention. To contribute towards food security and to improve nutritional standards, it is proposed that the forthcoming JPS should consider expansion in rice production, following success of NERICA Rice Dissemination Project. Component #4 “creating an enabling environment for development of the energy sector� could be pursued further, within a new component relating to infrastructure. 5.9 There is need for both institutions to build on the established partnership during JAS-1, through closer collaboration in critical sectors such as agriculture, regional infrastructure, and energy. The institutions should also improve dialogue with the government and with other development partners. Coordination between the JPS partners and other development partners has already received a big boost through the semi-annual budget review meetings. There is a need however, to build capacity within the government to enable them play the leading role in donor coordination. There is also a need to improve the outreach to civil society, particularly during the JPS design phase, to include the private sector, members of the National Assembly, political leaders, and opinion leaders. 19 The Gambia River Bridge in the case of the AfDB and the West Africa Regional Communications Infrastructure Project in the case of the WB. 54 THE GAMBIA: JAS 2008�2011 COMPLETION REPORT Annex Table (1) Summary of the JAS Program Self�Evaluation JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 JAS Pillar I: Strengthening the Institutional Framework for Economic Management and Public Service Delivery COMPONENT 1.1 IMPROVING THE TRANSPARENCY AND ACCOUNTABILITY IN THE USE OF PUBLIC RESOURCES Outcome (1) Strengthened 1.1 (i) The Gambia Revenue Authority 1.1 The forthcoming JPS should Public Financial (GRA) has launched a three year Strategic Plan AfDB maintain the current Pillar I to Management. (2008-2010) to upgrade performance, including (i) ISPEFG (UA1.4 m, closed 2010) consolidate the gains attained in 1.1 (i) The Gambia Revenue staff performance linkage to the way staff are (ii) ISPEFG II (UA2 m approved Sept economic and public financial Authority (GRA) develops a managed and their benefits (achieved). 2011) management. Areas of reform should performance-based human (ii) The GRA activity-based budget system is (ii) Poverty Reduction Budget include, inter allies, up-dating the resource management system linked to revenue collection (achieved, but later Support (PRBSP) (UA4 m, closed current PFM, tax reforms, including based on an effective appraisal than 2010) 2009). the replacement of the current sales system. (iii) CFAA (closed 06/10). tax with VAT, public procurement (ii) GRA’s budget linked with reform and the introduction of an revenue collection by end 2010. World Bank MTEF. (achieved/satisfactory). (i) CBEMP/AF (US$3 m, closed 1.2 Improved efficiency of tax 12/09) 1.2 The policy reform program (1.1 administration (achieved/ (ii) IFMIS Project (US$5.25 m) above) should be complemented with satisfactory). (iii) Public Sector Reform and an appropriate institutional reform (i) A new tax administration IT Growth Grant (budget support, US$7 program to build capacity in PFM system is fully developed and 1.2 (i) A new tax administration IT system was m, closed 12/09). monitoring and evaluation, internal used for processing of all large developed and used for processing of all large (iv) CFAA (closed 06/10). and external audit, design and taxpayers (achieved/ taxpayers by end 2009. (achieved) (v) Poverty Assessment (closed implementation of MTEF. satisfactory); (ii) The Customs Act was revised, and adopted in 06/10). (ii) Customs Act revised and April 2010. (achieved) (vi) Public Expenditure Review 1.3 Ensure that adequate budgetary adopted. (closed 2011). allocations are provided for the (achieved /satisfactory). (vii) Anti-Money Laundering TA. maintenance of IFMIS and training of 1.3 Improved budget 1.3 (i) An MTEF is experimented on a pilot basis staff on the use of the system. preparation and execution in the Ministry of Basic & Secondary Education. (partly achieved / moderately Full MTEF is now planned for 2013. (partly satisfactory). achieved) (i) MTEF ensures adequate (ii) Budget outturns are published on a monthly balance between development basis. (achieved). and recurrent expenditures. (iii) Key PRSP public expenditures (education, health & social welfare) have since 2008 been in 55 JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 (ii) 2008 outturns of line with the planned targets. However, there were development expenditures considerable deviations in critical sectors relevant published by end 2009. for the country’s development agenda – ranging (iii) Percent deviation between from 9 percent (forestry) to 47 percent (energy) - cash plan of Ministries, between initial allocations and actual expenditure Departments, agencies, and for 2011. (not achieved) actual cash allocation. Outcome (2) Strengthened World Bank 2.1 Management of the GBOS’ web- national Statistical system. 2.1 The Integrated Household Survey carried out (i) Transformation of the CSD into site should be strengthened so as to (partly achieved /mod. satisf.) in 2010 and has so far not been made publicly GBOS (closed ’10) enable it to post the information on its 2.1 Key findings from national available through the GBOS website. Poverty site with minimum lapse of time. surveys disseminated within profile and CPI indices are also planned to be one year of data collection. disseminated by end of 2011. (achieved). 2.2 National accounts data 2.2 National accounts data, using new disseminated using new methodology based on IFMIS and the NAO web- methodology by end 2010. based information was disseminated by end of 2010. (achieved) The GBOS web-site is being updated regularly. Currently national accounts data covering estimates for 2010 are published on the web-site. Outcome (3) Strengthened 3.1 The 8-year backlog of unaudited public AfDB 3.1 Capacity building in the area of Audit function. accounts, which existed in 2008, was cleared, ISPEFG I & II. internal and external audit should be (partly achieved /mod. satisf.) which is a huge accomplishment. (achieved) (ii) Poverty Reduction Budget strengthened through on-going and 3.1 Backlog of unaudited 3.2. The timing of production and dissemination of Support (PRBS). additional projects. accounts cleared by 2010. audit reports has still not fully met the World Bank 3.2. Audit of public accounts expectations: Government Financial Statements (i) ROSC with focus on auditing and produced and disseminated from 2008-2010 were submitted to the National accounting. within one year of fiscal year. Audit Office for auditing only by May/June 2012, which exceeds the benchmark of one year following the end of the respective fiscal year. (not achieved) COMPONENT 1.2: IMPROVING CIVIL SERVICE Outcome (4) Enhanced HR AfDB 4.1 The unfinished agenda regarding Management policy and tools (i) Civil Service Study the integration of the HR information used in public administration. (AfDB/WB/DFID). with the payroll system and the 56 JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 (partly achieved /mod. satisf.) 4.1 A pay reform strategy was prepared as planned (ii) Governance Profile. application of effective performance 4.1 Prepare and begin for 2008 and salaries increased by 20percent in World Bank appraisal tools should be pursed. implementing a pay reform 2008 and 2011. Budget limits further planned (i) Civil Service Study strategy to improve civil service increases in fully resolving the compensation issue (AfDB/WB/DFID). compensation. (achieved). (iii) Governance Support TA 4.2 Integration of the HR information system with (iii) Pay and Employment Model TA 4.2 Integrate HR information the payroll system is underway but slow. (iv) IFMIS Project. system and payroll system. (partly achieved) (v) Civil Service Reforms TA 4.3 Develop effective 4.3 Development of effective performance (US$0.5 m, IDF) performance appraisal tools in appraisal tools in key sectors is delayed but key sectors. ongoing. It will be piloted in The Ministries of Tourism, and Youth & Sports. (partly achieved) COMPONENT 1.3 IMPROVING PUBLIC SERVICE DELIVERY IN EDUCATION, HEALTH, WATER AND RURAL ELECTRIFICATION Outcome (5): Increased 5.1 The rate as at 2010/11 was above 90 percent AFDB primary enrollment. (including madrassas). (achieved) (i) Education III Project (closed (achieved / satisfactory) 2010). 5.1 Gross primary enrollment World Bank rate (target: >72 percent (i) Education III (Phase 2) including excluding madrassas; >90 Additional Financing (US$13.5 m) percent including madrassas) (ii) PHRD co-financing (US$3 m). Outcome (6): Improved (iii) Education for All-Fast Track quality of education. Initiative (US$28 m). (Partly achieved / moderately (v) Multi-Grade Reading Initiative satisfactory) (closed). 6.1 Gross completion rate 6.1 Gross completion rate in 2012 was 72 percent. (vi) Reaching out-of-school children (target: 68 percent excluding This includes the certified madrassas that follow & building skills for youth madrassas). the regular curriculum (achieved). employment (closed). 6.2 Percent of targeted teachers 6.2 The results of WASSCE of the first group of (vii) Education Country Status Report obtaining West African Senior targeted teachers (beneficiaries of in-service Light (2011). School Certificate Examination training) will become available only in February (WASSCE) credits in English 2013. However, the percentage of beneficiaries and math. (target: 30 percent) eligible for taking the exams amongst the overall group of beneficiaries is less than 30%, hence the ambitious target cannot be achieved as envisaged. (not achieved) 57 JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 Outcome (7): Strengthened World Bank: policy framework for (i) Community-Driven Development nutrition programs. Project (CDDP). (achieved / satisfactory) 7.1 A new Nutritional Policy (2010-2020) was (ii) CDDP Impact Evaluation. 7.1 Adoption of new Nutrition formulated and validated in January 2011, and a (iii) Nutrition Security Improvement Policy including a national costed Strategy Plan for Nutrition (2011-2015) (US$3 m, Rapid Social Response Action Plan on Nutrition. was elaborated. The policy and strategic plan are Program). planned for presentation to the Cabinet by early (iv) Strengthening Capacity to 2012. (achieved) Improve Nutrition Outcomes (TA). Outcome (8): Increased access to water and sanitation. AfDB: (not observed / (i) National Water Sector Reform unsatisfactory) Study (EUR1.99 m). 8.1 Number of people 8.1 (not observable). There has been no direct World Bank: benefiting from additional investment in the sector by either institution during (i) CDDP. water and sanitation the JAS period. (ii) CDDP Impact Evaluation. connections. (target: >100,000) JAS Pillar II: Enhancing Productive Capacity and Accelerating Growth and Competitiveness COMPONENT 2.1: PROMOTING A COMPETITIVE INVESTMENT CLIMATE/GROWTH AND COMPETITIVENESS Outcome (9): Improved 9.1 Value of new private investment through AfDB Investment Climate. GIEPA surpassed the target: In addition to (i) Gambia River Bridge Survey investments of US$ 30 million in 200839, GIEPA (Completed). 9.1 Monetary value of new received in 2010 seven new private sector (ii) Gambia Bridge Project (UA54.0 private investment attracted investment proposals with a total proposed value m; approved in 2011). during JAS (2008-2011) of about US$30.4 million. Corresponding figures World Bank through GIPZA. (target: for 2011 were 13 investment proposals with a (i) Report on the Observance of >US$55 m in JAS period) value of US$60 million. Standards & Codes (ROSC) with 9.2 Improved procedures for 9.2 According to the 2013 Doing Business focus on accounting and auditing. business registration. (targets: indicators the time required for registering a (ii) BEIA – Promotion of improved time: 20 days; cost: 190 percent business is still 27 days, in contrast to 34 days for Biomass Vesto Stoves (US$0.15, TF). of per capita income) sub-Sahara Africa - whereas the cost of business (iii) Growth & Competiveness Project registration (158.7 percent of per capita income) (US$12 m). by far exceeded that of sub-Sahara (67.3 percent), (v) West Africa Regional Communi- but still met the very conservative target value. cations Infrastructure Program – GM 58 JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 Doing Business Indicators depict that the component (US$7 m) country’s rank for doing business has slightly improved from 149 in 2012 to 147 in 2013. COMPONENT 2.2 FACILITATING ACCESS TO FINANCIAL RESOURCES BY SMES. Outcome (10): Improved 10.1 The EPMD over 2009-2011 provided about AfDB access to finance for MSMEs. 2.0 GMD million (US$ 68,000) to 567 farmers in (i) Entrepreneurship Promotion & 10.1 Number of direct clients micro-credits. The AfDB over 2008-2011 through Microfinance Development (EPMD). served through micro-finance 5 projects (AFDP, CSIP, PRP, PSIP, and EPMDP) (ii) Community Skills Development component of AfDB’s EPMDP extended micro-credits to 3,939 clients amounting (CSIP). and IFC. to GMD 22.7 million (US$ 0.8 million). Direct (iii) Artisanal Fisheries Development (not achieved / unsatisfactory) impact of IFC support could not be assessed. Project (Supplementary) IFC. (i) IFC support to MSMEs. COMPONENT 2.3 STRENGTHENING THE AGRICULTURAL AND RURAL DEVELOPMENT. Outcome (11): Improved 11.1 More than 60,000 farmers had received AfDB 11. To promote food security the productivity of crops & improved seeds and recommended fertilizer by (i) Rice Irrigation Project (closed) portfolio in support of the next JPS livestock production & early 2011, and 870 farmer groups received farm (ii) NERICA (ongoing) should include operations which fishery. machineries (as compared to 667 initially (iii) Peri-Urban Agricultural propagate the adoption of the NARICA (achieved / satisfactory) expected). The number of beneficiaries of Project (closed). rice variety. pesticide distribution could not be established. (iv) Water Shed Irrigation (closed). 11.1 Number of farmers that 11.2 Paddy rice increased from 11,400 MT in 2008 (v) Aquatic Weeds (Regional) receive agricultural inputs to 61,000 MT in 2010. Groundnuts output (closed) (tools, fertilizers, pesticides). increased from 110,000 MT in 2008 to 122,000 (vi) OMVG (Regional) (closed) (targets: fertilizer: 20,000; MT and 138,000 Mt in the subsequent two years. (vii) Livestock & Horticulture pesticides: 20,000) 11.3 Fisheries output (industrial and artisanal) Project (ongoing). 11.2 Increased yields in increased from 46,000 tons in 2008 to an estimated (viii) Artisanal Fisheries targeted crops (rice, 40,000 tons and 50,000 tons respectively in the Development Project (AFDP) horticulture) in selected areas. subsequent two years. (Suppl). (target: rice: 2.2T/ha) (ix) Sustainable Land Mangt 11.3 Fishery output (target: Project (ongoing). 45,000T) World Bank (i) CDDP (ii) CDDP Impact Evaluation. 59 JAS Outcome/Cluster of Status and Evaluation Summary Lending & Non-lending Activities Lessons & Suggestions for the Outcomes & Outcome that contributed to the Outcome Forthcoming JPS Indicators (baseline and AfDB/WB Interventions targets)38 (iii) Emergency Agricultural Production Project (US$7 m, GFCR TF). (iv) Agricultural Sector Policy Note (contribution to upcoming JPS). (v) Strengthening Integrated Biodiversity Management (US$1 m, GEF). (vi) West Africa Agricultural Productivity Program – GM component (US$7 m). Outcome (12) Increased 12.1 Pesticide storage in place (done). World Bank prevention and locust early 12.2 Response time to locust early warning has (i) Regional Africa Emergency warning reaction been reduced from 30 to one day. Locust Mitigation Program – GM (achieved / satisfactory) component (US$1.9 m). 12.1 Pesticide storage in place (prevention). 12.2 Response time to early warning. (target: 1 day). Outcome (13): Intervention 13.1 An Electricity Sector Diagnostic Note has World Bank 13. The electricity sector note should be for Reform of Electricity been completed. Electricity Sector Diagnostic followed up with an Energy Master Plan. Sector agreed with Report. Government (partially achieved / mod. satisf.) 13.1 Electricity Sector Note completed, discussed and next steps agreed with relevant authorities. 60 THE GAMBIA: JAS 2008�2011 COMPLETION REPORT Annex Table (2) Summary of the JAS Program Self�Evaluation JAS PLAN (2008�2011) STATUS Fiscal Project U A Project UA Year Amount (m) Amount (m) AFRICAN DEVELOPMENT BANK (AfDB) 2008 1. Livestock & Horticulture Develop. 6.70 1. Reduced allocation 4.02 1. Poverty Reduction Budget Support 3.30 1. Reduced allocation 3.00 Additional From Africa Food Crisis Facility 1.00 2009 2. Artisanal Fisheries (Supplementary) 5.00 Sub�total 3.30 Sub�total 9.00 Additional Actual Projects 1. Sustainable Land Management Project 3.02 2010 2. National Water Sector Reform Study 1.76 Sub�total Sub�total 4.78 1. Water Supply & Sanitation Project 5.00 1. Forwarded to January 2012 4.65 2. MSME Line of Credit TBD 2. Dropped 2011 3. Additional Actual Gambia Bridge (Additional from Regional Allocations) 66.83 Sub�total 5.00 Sub�total 71.48 Total 15.00 Total 89.28 WORLD BANK Amount Amount US US Dollar Dollar (m) (m) 2008 Additional Financing CBEMP 3.00 Additional: Support to NGO Network TANGO 0.22 Sub�total 3.00 Sub�total 0.22 2009 Public Sector Reform & Growth Grant 7.00 Actual 7.00 (Budget Support) Additional: Education for All Fast Track Initiative 28.00 Third Education Project 1.40 Sub�total 7.00 Sub�total 36.40 2010 Growth & Competitiveness 8.00 Increased allocation 12.00 IFMIS forwarded to FY 2009 5.25 Additional Projects Third Education Project (Phase II) 5.50 Gambia Emergency Agriculture Project 7.51 BEIA – Promotion of Improved Biomass Vesto Stoves 0.15 Gambia Rapid Response Nutrition Security Improvement 3.00 Strengthening Integrated Biodiversity Management 0.94 Sub�total 10.25 Sub�total 19.10 2011 TBD Forwarded to FY Water And Sanitation (OBA) TBD Forwarded to FY SME/Microfinance (IFC) Additional Project(s) W. Africa Agricultural Productivity Program 7.00 W. Africa Regional Communications Infrastructure 35.00 Project. 0.49 Gambia: IDF For Civil Service Reform Sub�total TBD Sub�total 42.49 Total FY 20080�2011 20.25 98.21 61 THE GAMBIA: JAS 2008�2011 COMPLETION REPORT Annex Table (3) Planned Non�Lending Services and Actual Deliveries JAS PLANS (2008�2011) STATUS THE AFRICAN DEVELOPMENT BANK 1. Renewable Energy Study Study completed in 2008 2. Country Financial Accountability Completed in 2009 Assessment 2008 3. Civil Service Study Study completed in 2009 4. Governance Profile Profile completed in 2008 5. Banjul Port Study Completed in 2009 1 Gender Profile Completed in 2010 2009 2. Diagnostic Study of Re�export Sector Dropped 2010 1. Private Sector Profile Dropped. THE WORLD BANK 2008 Civil Service Reform Study Completed in 2008 1. CFAA Completed in 2010 2. Investment Climate Assessment 3. Poverty Assessment Study Completed in 2010 2009 4. Report on Observance of Standards and Completed in 2010 Codes (ROSC) 1. Pay and Employment Model 2. Transformation of the Central Statistics 2010 Department into GBOS 3. Multi�Grade Reading Initiative 4. Debt Management Performance Assessment 5. Creating Commercial Community Enterprises through the Promotion of Fuel Efficient Stoves & Biomass Briquettes. 1 .Education Country Status Report Light. 2. CDDP Impact Evaluation 3. TA for National Nutrition Agency (NaNA) 4. Ant�Money Laundering 2011 5. Agricultural Sector Policy Note 6. Reaching out�of�school children & building skills for Youth Employment. 7. Public Expenditure Review 8. Civil Service Reform TA 9. Procurement Reform TA 10. Energy Policy Note 62 Annex Table (4) THE GAMBIA: Summary of the project outputs from the 2008�11 JAS STATUS JAS PLAN (2008-2011) Fiscal Project Amount Project Amount Year UA (m) UA (m) AFRICAN DEVELOPMENT BANK (AfDB) 2008 1. Livestock & Horticulture 6.70 1. Reduced allocation 4.02 Develop. 1. Poverty Reduction Budget 3.30 1. Reduced allocation 3.00 Support Additional From Africa Food Crisis Facility 1.00 2009 2. Artisanal Fisheries (Supplementary) 5.00 Sub-total 3.30 Sub-total 9.00 Additional Actual Projects 1. Sustainable Land Management Project 3.02 2010 2. National Water Sector Reform Study 1.76 Sub-total Sub-total 4.78 Water Supply & Sanitation 5.00 Forwarded to January 2012 4.65 Project TBD Dropped 2011 MSME Line of Credit Additional Actual Gambia Bridge (Additional from Regional Allocations) 66.83 Sub-total 5.00 Sub-total 71.48 Total 15.00 Total 89.28 WORLD BANK Amount Amount USD USD (m) (m) 2008 Additional Financing CBEMP 3.00 Actual 3.00 Additional: Support to NGO Network 0.22 TANGO Sub-total 3.00 Sub-total 0.22 2009 Public Sector Reform & 7.00 Actual 7.00 Growth Grant (Budget Support) Additional: Education for All Fast Track Initiative 28.00 Third Education Project (JSDF) 1.30 Sub-total 7.00 Sub-total 36.40 2010 Growth & Competitiveness 8.00 Increased allocation 12.00 IFMIS forwarded to FY 2009 5.25 Additional Projects 5.50 Third Education Project (Phase II) 7.51 Gambia Emergency Agriculture Project 0.15 BEIA – Promotion of Improved Biomass 3.00 Vesto Stoves 0.94 63 Gambia Rapid Response Nutrition Security Improvement Strengthening Integrated Biodiversity Management Sub-total 10.25 Sub-total 19.10 2011 Water And Sanitation (Output-based TBD dropped Aid) TBD dropped SME/Microfinance (IFC) Additional Project(s) 7.00 W. Africa Agricultural Productivity 35.00 Program 0.49 W. Africa Regional Communications Infrastructure Project. Gambia: IDF For Civil Service Reform Sub-total TBD Sub-total 42.49 Total FY 20080-2011 20.25 98.21 64 Annex Table (5) Planned Non�Lending Services and Actual Deliveries under the 2008�11 JAS JAS PLANS (2008-2011) STATUS THE AFRICAN DEVELOPMENT BANK 1. Renewable Energy Study Study completed in 2008 2. Country Financial Accountability Completed in 2009 Assessment 2008 3. Civil Service Study Study completed in 2009 4. Governance Profile Profile completed in 2008 5. Banjul Port Study Completed in 2009 1 Gender Profile Completed in 2010 2009 2. Diagnostic Study of Re-export Sector Dropped 2010 1. Private Sector Profile Moved to 2012 THE WORLD BANK 2008 Civil Service Reform Study Completed in 2008 1. CFAA Completed in 2010 2. Investment Climate Assessment 3. Poverty Assessment Study Completed in 2010 2009 4. Report on Observance of Standards and Codes (ROSC) 1. Pay and Employment Model 2. Transformation of the Central 2010 Statistics Department into GBOS 3. Multi-Grade Reading Initiative Completed 4. Debt Management Performance Assessment 5. Creating Commercial Community Enterprises through the Promotion of Fuel Efficient Stoves & Biomass Briquettes. 1 .Education Country Status Report Completed (light) 2. CDDP Impact Evaluation 3. TA for National Nutrition Agency (NaNA) 2011 4. Ant-Money Laundering 5. Agricultural Sector Policy Note 6. Reaching out-of-school children & Completed building skills for Youth Employment. 7. Public Expenditure Review 8. Civil Service Reform TA 9. Procurement Reform TA 10. Energy Policy Note 65 Annex 4: The Gambia Country Climate Fact Sheet INTRODUCTION: This document is prepared as part of the African Development Bank’s preparatory activities for the development of The Gambia’s Country Strategy Paper (CSP) for the period 2012 – 2016. The objective is to promote climate proof investments and climate resilient development in the country through mainstreaming of climate change concerns into the country’s CSP. The Fact Sheet also identifies a range of investment activities that the AfDB and WB could jointly finance in their support to the country’s efforts to pursue sustainable development, particularly in the implementation of its Program for Accelerated Growth and Employment (PAGE - 2011- 2015). GENERAL CLIMATE CONTEXT OF THE COUNTRY: Temperatures in The Gambia generally increase from the coast towards the west. In the hottest season of April to June (AMJ, the hottest (inland) regions have averages temperatures of up to 35°C, whilst the cooler coastal regions are 25 to 28°C. In the cooler seasons of October to December and January to March (OND and JFM) average temperatures can be below 25°C at the coast and up to 30°C in the west. The Gambia has distinct dry and rainy seasons. Mean monthly wet�season rainfall varies between 150 and 300mm between the northern and southern extremes. RECENT CLIMATE TRENDS: Mean annual temperature has increased by 1.0°C since 1960, an average rate of 0.21°C per decade. The rate of increase is most rapid in OND, at 0.32°C per decade. Available data indicate that the average number of ‘hot’ nights per year increased by 7.8percent between 1960 and 2003. Linear trends indicate that wet season rainfall in The Gambia has decreased significantly between 1960 and 2006, at an average rate of 8.8mm per month per decade. FUTURE CLIMATE SCENARIOS: Recent scenario analysis produced by the UNDP Climate Change Country Profiles for The Gambia. The mean annual temperature is projected to increase by 1.1 to 3.1°C by the 2060s, and 1.8 to 5.0°C by the 2090s. All projections indicate substantial increases in the frequency of days and nights that are considered ‘hot’ in current climate. Projections of mean annual rainfall averaged over the country from different models in the ensemble project a wide range of increases and decreases in precipitation for The Gambia, but tend towards decreases, particularly in the wet season. Projected annual change ranges from �23 to +18percent by the 2090s, with ensemble means between 0 and �3percent. Projected changes ranges from �53 to +74percent by the 2090s, with ensemble means between �7 and � 20percent. Despite the projected decreases in total rainfall, the proportion of total annual rainfall that falls in heavy events tends towards increases in the ensemble projections. The IPCC (2007) regional projections indicate that the coastal lowlands of The Gambia may be vulnerable to sea�level rise as sea�level in this region is projected to rise by between 0.13 and 0.56 under different scenarios (Christensen et al. 2007). TRENDS IN EXTREME WEATHER SCENARIOS: Climate change will magnify natural disasters’ severity in terms of intensity and frequency in The Gambia. Substantial increases in the frequency of days and nights that are considered ‘hot’ in current climate 66 are expected from climate change projections. ‘Hot’ days40 will occur on 22�48percent of days by the 2060s, and 25�69percent of days by the 2090s. Days considered ‘hot’ by current climate standards for their season may increase most rapidly during the rainy season of July to September. Projected increases in hot days and nights are more rapid in the east of the country than the west. The proportion of total annual rainfall that falls in heavy events tends towards increases in the ensemble projections. It is expected that there will be increasing frequency of extreme weather events evident in terms of floods and drought in the country. COUNTRY VULNERABILITY: The Gambia is one of the most vulnerable countries in Africa to the adverse impacts of climate change. With approximately 50percent of the total land area being less than 20m above sea level, and about 33percent of the country below 10m above mean sea level, any significant global warming-induced sea level rise could submerge much of the country. Currently, about 20percent of the country is flooded annually and the mangrove ecosystems are already affected by saline intrusion as well as flooding. Erratic rainfall patterns impact on freshwater reserves and increased evaporation affects groundwater replenishment. The country’s First National Communication projected that about 92 sq. km of land in the coastal zone will be inundated as result of 1m sea level rise. This suggests that the whole of the capital city of Banjul will be lost due to the fact that the greater part of the city is below 1m, with losses estimated at 217 million US Dollars as at 2003. The other key sectors of The Gambia that are considered most vulnerable to climate change are water resources, forestry, agriculture, fisheries and energy, and health, and their potential vulnerabilities have been elaborated in the country’s NAPA. In particular, agriculture which is about 99percent rain-fed is extremely vulnerable to climate. This sector’s contribution to GDP is about 30percent and its share of the workforce is about 70percent. COUNTRY CLIMATE CHANGE STRATEGY: Gambia has recognized the need to address the challenge of climate change seriously, and has put in place many policies and strategies towards promoting climate resilient economy and society. Some of the polices and measures to directly or indirectly address the adverse impacts of climate change include (i) National Adaptation Program of Action (NCC/NAPA, 2007); (ii) The Gambia Environmental Action Plan II (GEAP, 2010); (iii) Nationally Appropriate Mitigation Actions (NCC/NAMA, 2011); (iv) National Disaster Management Act (2008); (v) Poverty Reduction Strategy Paper II (2007 – 2011); (vi) Program for Accelerated Growth and Employment - PAGE(2011 – 2015), which integrated climate change in the development strategies. Its pillar 5 has critical elements of environment, disaster risk reduction and climate change treated as cross-cutting issues; ; (vii) establishment of the National Climate Committee in 1992; and (viii) submission of the First National Communication to the UNFCCC (NCC/FNC) in 2003). The encompassing strategic approach of these initiatives is the pursuit of low-carbon high resilient infrastructure for sustainable development. In addition, the Government of The Gambia has been partnering with many donors to implement many projects that have significant bearing to the issues of climate change. 67 COUNTRY MITIGATION POLICY: As climate change is mainly due to the concentration of greenhouse gases (GHG) in the atmosphere that results in global warming, any mitigation strategy will have to reduce the emissions of these gases and/or enhance the carbon sinks. The country’s First National Communication to the UNFCCC in 2003 identified options for reducing emissions of GHGs and for the greater sequestration of these gases. These options include:  Reduction of the use of fossil fuel in the generation of electricity especially in the rural areas;  Promotion of improved cooking stoves;  Carbon sequestration through reforestation and the protection of existing forests;  Integrated crop and livestock farming; and  Large scale introduction of Liquefied Petroleum Gas (LPG) to displace fuel wood There is a serious ongoing attempt to promote alternatives to conventional energy sources and secure of greater private sector participation. COUNTRY ADAPTATION POLICY: In response to the challenges of climate hazards and climate change the Government completed the formulation of the National Adaptation Plan of Action (NAPA) in 2007 which provides a policy framework to address the impact of climate change at national and local levels. The main goal of the NAPA is the identification of priority adaptation activities. Building upon the existing coping strategies implemented by local communities in order to enhance their adaptation capacity NAPA seeks to: (1) understand the main characteristics of climate hazards in The Gambia (flood, drought, salt water intrusion); (2) understand coping mechanisms to climate hazards and climate change at the local and national levels; (3) understand existing programs and institutional arrangements for addressing climate hazards and climate change; (4) identify and prioritize adaptation activities to climate hazards and climate change. Key national adaptation measures are given in Table 9. Table 9: Adaptation Measures to Reduce the Impact of Climate Change in some Sectors in The Gambia Sector Adaptation Measures Agriculture  Diversification and Intensification of Agricultural Production, Processing and Marketing  Establishment of tidal irrigation schemes. Water Resources  Improvement of freshwater availability. Management  Construction of embankments/dykes for flood control Coastal zone  Beach stabilization  Construction or rehabilitation of groynes  Rehabilitation of wetlands  Review of legal and policy instruments relating to the coastal areas  Rehabilitation of the pumping station in Banjul Forestry  Enhanced community participation in the management of forests and protected areas.  Maintaining and improving the productive functions of forest and woodlands  Expansion and intensification of agro-forestry and re-forestation Energy  Promotion of wide�scale adoption of renewable alternative energy sources to wood that can reduce the GHG emissions. 68  Improve energy efficiency. Health  Providing support in the management of epidemics and emergency public health response. . Climate Change  Enhanced capacity of National Environmental Agency Information and  Rehabilitation of Early Warning Systems on Climate Related Natural Awareness Creation Hazards  In�depth studies of climate change impacts on all sectors and vulnerability assessments  Effective and timely dissemination of information to stakeholders INSTITUTIONAL FRAMEWORK AND ACTORS: The Ministry of Forestry and Environment is the Policy Focal line Ministry for UNFCCC and Director, Department of Water Resources, the UNFCCC Focal Person. The main institutions involved in the issues of climate change in the country include: (i) Department of Agriculture; (ii) National Agricultural Research Institute; (iii) GBOS; (iv) National Environment Agency; (v) Ministry of Finance; (vi) Ministry of Health; (vii) Department of Forestry; (viii) Department of Water Resources; (ix) Department of Energy; (x) Department of Livestock; (xi) Department of Fisheries; (xii) Department of Parks & Wildlife Management; (xiii) NGOs; and (xiv) Private Sector. RECOMMENDED PROJECTS OR PROGRAMS: The following (Table 10) are some of the projects and/or programs that the Bank can support to promote low-carbon high resilient infrastructure for sustainable development in The Gambia. Their relative contributions to economic growth, climate resilience and improved wellbeing, as well as their sustainability are assessed. Table 10: Proposed Programs/Projects for the Bank’s Intervention Sector Activities Contribution Contribution Contribution t development to economic sustainable to poverty reduction resilient climate growth carbon to low� l and d Agriculture Support to the Agricultural Agenda of PAGE to establish 3 2 3 financial mechanisms that link climate finance to agriculture investment for climate�smart agricultural development. Energy Promotion of renewable energy alternatives, particularly solar and 1 2 2 biomass (energy crops) Energy efficiency programs in public, industrial and 1 2 1 residential buildings Transport Urban mass transportation financing 3 3 2 Support to climate resilient roads 2 3 3 Water Expansion of efficient irrigation systems 2 1 2 resources Water resources conservation 2 1 2 0 : no contribution 1: small 2 : moderate 3 : significant contribu contribution contribution tion 69 Annex 5: A2-The Gambia at a Glance The Gambia at a glance 10/15/12 Sub- Ke y D e v e lo pm e nt Indic a t o rs The Saharan Lo w Gambia A frica inco me Age distribution, 2010 ( 2 0 11) Male Female P o pulatio n, mid-year (millio ns) 1.8 853 796 75-79 Surface area (tho usand sq. km) 11 24,243 15,551 60-64 P o pulatio n gro wth (%) 2.8 2.5 2.1 Urban po pulatio n (% o f to tal po pulatio n) 57 37 28 45-49 30-34 GNI (A tlas metho d, US$ billio ns) 1 .1 1,004 421 15-19 GNI per capita (A tlas metho d, US$ ) 620 1 ,176 528 GNI per capita (P P P , internatio nal $ ) 1,300 2,1 48 1,307 0-4 10 5 0 5 10 GDP gro wth (%) -4.3 4.8 5.9 percent of total population GDP per capita gro wth (%) -6.9 2.3 3.7 ( m o s t re c e nt e s t im a t e , 2 0 0 5 – 2 0 11) P o verty headco unt ratio at $ 1 .25 a day (P P P , %) 34 48 .. Under-5 mortality rate (per 1,000) P o verty headco unt ratio at $ 2.00 a day (P P P , %) 56 69 .. Life expectancy at birth (years) 58 54 59 200 Infant mo rtality (per 1,000 live births) 58 76 70 180 Child malnutritio n (% o f children under 5) 16 22 23 160 140 A dult literacy, male (% o f ages 15 and o lder) 58 71 69 120 100 A dult literacy, female (% o f ages 15 and o lder) 36 54 54 80 Gro ss primary enro llment, male (% o f age gro up) 82 104 108 60 Gro ss primary enro llment, female (% o f age gro up) 84 95 101 40 20 0 A ccess to an impro ved water so urce (% o f po pulatio n) 89 61 65 1990 1995 2000 2010 A ccess to impro ved sanitatio n facilities (% o f po pulatio n) 68 31 37 The Gambia Sub-Saharan Africa N e t A id F lo ws 19 8 0 19 9 0 2000 2 0 11 a (US$ millio ns) Net ODA and o fficial aid 53 97 50 121 Growth of GDP and GDP per capita (%) To p 3 do no rs (in 2010): Euro pean Unio n Institutio ns 9 5 8 23 8 Japan 0 6 3 17 6 United States 4 12 3 6 4 2 A id (% o f GNI) 22.2 33.4 6.6 11.9 0 -2 A id per capita (US$ ) 84 101 38 70 -4 -6 Lo ng- T e rm E c o no m ic T re nds -8 95 05 Co nsumer prices (annual % change) 6.8 12.2 0.9 4.5 GDP implicit deflato r (annual % change) -0.2 12.0 2.2 3.7 GDP GDP per c apita Exchange rate (annual average, lo cal per US$ ) 1.7 7.9 12.7 29.5 Terms o f trade index (2000 = 100) .. 100 1 00 90 19 8 0 – 9 0 19 9 0 – 2 0 0 0 2 0 0 0 – 11 (average annual gro wth %) P o pulatio n, mid-year (millio ns) 0.6 1.0 1.3 1.8 4.3 2.9 2.9 GDP (US$ millio ns) 241 31 7 787 898 3.6 3.0 3.4 (% o f GDP ) A griculture 30.8 29.0 23.8 20.0 0.9 3.3 1.4 Industry 14.9 13.1 6.0 14.3 4.7 1.0 3.4 M anufacturing 5.6 6.6 6.6 5.5 7.8 0.9 3.2 Services 54.3 57.9 70.1 65.7 2.7 3.7 4.3 Ho useho ld final co nsumptio n expenditure 63.0 75.6 89.0 89.5 .. .. 4.5 General go v't final co nsumptio n expenditure 31.2 13.7 11.2 9.6 1.7 -2.2 6.4 Gro ss capital fo rmatio n 26.7 22.3 4.6 19.2 .. .. 0.5 Expo rts o f go o ds and services 42.7 59.9 25.8 28.9 1.2 0.1 -0.6 Impo rts o f go o ds and services 63.6 71.6 30.6 47.2 -5.5 0.1 1.7 Gro ss savings .. 5.3 -0.2 3.9 No te: Figures in italics are fo r years o ther than tho se specified. 2011data are preliminary. .. indicates data are no t available. a. A id data are fo r 2010. Develo pment Eco no mics, Develo pment Data Gro up (DECDG). 70 The Gambia B a la nc e o f P a ym e nt s a nd T ra de 2000 2 0 11 Governance indicators, 2000 and 2010 (US$ millio ns) To tal merchandise expo rts (fo b) 126 1 19 To tal merchandise impo rts (cif) 193 390 Voice and accountability Net trade in go o ds and services -37 -186 Political stability and absence of violence Current acco unt balance -16 -117 as a % o f GDP -2.0 -13.0 Regulatory quality Rule of law Wo rkers' remittances and co mpensatio n o f emplo yees (receipts) 56 116 Control of corruption Reserves, including go ld 111 177 0 25 50 75 100 C e nt ra l G o v e rnm e nt F ina nc e 2010 2000 Country's percentile rank (0-100) higher values imply better ratings (% o f GDP ) Source: Worldwide Governance Indicators (www.govindicators.org) Current revenue (including grants) 11.2 22.8 Tax revenue 8.7 14.7 Current expenditure 9.8 13.8 T e c hno lo gy a nd Inf ra s t ruc t ure 2000 2 0 10 Overall surplus/deficit -0.7 -1.7 P aved ro ads (% o f to tal) 19.3 .. Highest marginal tax rate (%) Fixed line and mo bile pho ne Individual .. .. subscribers (per 1 00 peo ple) 3 88 Co rpo rate .. .. High techno lo gy expo rts (% o f manufactured expo rts) 3.1 1.1 E xt e rna l D e bt a nd R e s o urc e F lo ws E nv iro nm e nt (US$ millio ns) To tal debt o utstanding and disbursed 490 466 A gricultural land (% o f land area) 68 67 To tal debt service 22 25 Fo rest area (% o f land area) 46.1 48.0 Debt relief (HIP C, M DRI) 98 244 Terrestrial pro tected areas (% o f land area) 1.5 1.5 To tal debt (% o f GDP ) 62.3 51.9 Freshwater reso urces per capita (cu. meters) 2,180 1,784 To tal debt service (% o f expo rts) 9.7 .. Freshwater withdrawal (billio n cubic meters) .. .. Fo reign direct investment (net inflo ws) 44 .. CO2 emissio ns per capita (mt) 0.21 0.25 P o rtfo lio equity (net inflo ws) 0 .. GDP per unit o f energy use (2005 P P P $ per kg o f o il equivalent) .. 14.0 Composition of total external debt, 2010 Energy use per capita (kg o f o il equivalent) .. 84 65 IDA, 0 IBRD, Short-term, Private, 6 44 Wo rld B a nk G ro up po rt f o lio 2000 2 0 10 IMF, 77 (US$ millio ns) Bilateral, 120 IB RD To tal debt o utstanding and disbursed – – Disbursements – – P rincipal repayments – – Other multi- lateral, 200 Interest payments – – US$ millions IDA To tal debt o utstanding and disbursed 171 65 Disbursements 8 2 P riv a t e S e c t o r D e v e lo pm e nt 2000 2 0 11 To tal debt service 4 1 Time required to start a business (days) – 27 IFC (fiscal year) Co st to start a business (% o f GNI per capita) – 199.6 To tal disbursed and o utstanding po rtfo lio 1 8 Time required to register pro perty (days) – 66 o f which IFC o wn acco unt 1 8 Disbursements fo r IFC o wn acco unt 0 2 Ranked as a majo r co nstraint to business 2000 2 0 10 P o rtfo lio sales, prepayments and (% o f managers surveyed who agreed) repayments fo r IFC o wn acco unt 0 0 Electricity .. 53.7 A ccess to /co st o f financing .. 11.6 M IGA Gro ss expo sure – – Sto ck market capitalizatio n (% o f GDP ) .. .. New guarantees – – B ank capital to asset ratio (%) .. .. No te: Figures in italics are fo r years o ther than tho se specified. 2011data are preliminary. 10/15/12 .. indicates data are no t available. – indicates o bservatio n is no t applicable. Develo pment Eco no mics, Develo pment Data Gro up (DECDG). 71 Millennium Development Goals The Gambia With selected targets to achieve b etween 1990 and 2015 (estimate clo sest to date sho wn, +/- 2 years) T he G a m bia G o a l 1: ha lv e t he ra t e s f o r e xt re m e po v e rt y a nd m a lnut rit io n 19 9 0 19 9 5 2000 2 0 10 P o verty headco unt ratio at $ 1 .25 a day (P P P , % o f po pulatio n) .. .. 65.6 .. P o verty headco unt ratio at natio nal po verty line (% o f po pulatio n) .. 33.0 69.0 48.4 Share o f inco me o r co nsumptio n to the po o rest qunitile (%) .. .. 4.0 .. P revalence o f malnutritio n (% o f children under 5) .. 23.2 15.4 15.8 G o a l 2 : e ns ure t ha t c hildre n a re a ble t o c o m ple t e prim a ry s c ho o ling P rimary scho o l enro llment (net, %) 45 55 67 66 P rimary co mpletio n rate (% o f relevant age gro up) 46 45 67 71 Seco ndary scho o l enro llment (gro ss, %) 19 25 .. 54 Yo uth literacy rate (% o f peo ple ages 15-24) .. .. 53 65 G o a l 3 : e lim ina t e ge nde r dis pa rit y in e duc a t io n a nd e m po we r wo m e n Ratio o f girls to bo ys in primary and seco ndary educatio n (%) 58 69 .. 99 Wo men emplo yed in the no nagricultural secto r (% o f no nagricultural emplo yment) .. .. 32 .. P ro po rtio n o f seats held by wo men in natio nal parliament (%) 8 .. 2 8 G o a l 4 : re duc e unde r- 5 m o rt a lit y by t wo - t hirds Under-5 mo rtality rate (per 1 ,000) 165 147 130 101 Infant mo rtality rate (per 1,000 live births) 78 72 67 58 M easles immunizatio n (pro po rtio n o f o ne-year o lds immunized, %) 86 91 89 97 G o a l 5 : re duc e m a t e rna l m o rt a lit y by t hre e - f o urt hs M aternal mo rtality ratio (mo deled estimate, per 1 00,000 live births) 700 650 520 360 B irths attended by skilled health staff (% o f to tal) 44 .. 55 57 Co ntraceptive prevalence (% o f wo men ages 1 5-49) 12 .. 10 .. G o a l 6 : ha lt a nd be gin t o re v e rs e t he s pre a d o f H IV / A ID S a nd o t he r m a jo r dis e a s e s P revalence o f HIV (% o f po pulatio n ages 1 5-49) 0.1 0.2 0.5 2.0 Incidence o f tuberculo sis (per 100,000 peo ple) 185 204 225 273 Tuberculo sis case detectio n rate (%, all fo rms) .. 44 54 44 G o a l 7 : ha lv e t he pro po rt io n o f pe o ple wit ho ut s us t a ina ble a c c e s s t o ba s ic ne e ds A ccess to an impro ved water so urce (% o f po pulatio n) 74 79 83 89 A ccess to impro ved sanitatio n facilities (% o f po pulatio n) 60 61 63 68 Fo rest area (% o f land area) 44.2 .. 46.1 48.0 Terrestrial pro tected areas (% o f land area) 1.5 1.5 1.5 1.5 CO2 emissio ns (metric to ns per capita) 0.2 0.2 0.2 0.3 GDP per unit o f energy use (co nstant 2005 P P P $ per kg o f o il equivalent) 17.6 .. .. 14.0 G o a l 8 : de v e lo p a glo ba l pa rt ne rs hip f o r de v e lo pm e nt Telepho ne mainlines (per 1 00 peo ple) 0.6 1.7 2.6 2.8 M o bile pho ne subscribers (per 1 00 peo ple) 0.0 0.1 0.4 85.5 Internet users (per 1 00 peo ple) 0.0 0.0 0.9 9.2 Co mputer users (per 1 00 peo ple) .. .. .. .. Education indicators (%) Measles immunization (% of 1-year ICT indicators (per 100 people) olds) 125 100 100 90 100 80 75 70 75 60 50 50 50 40 25 30 25 0 20 2000 2005 2010 10 0 0 1990 1995 2000 2010 2000 2005 2010 Primary net enrollment ratio The Gambia Sub-Saharan Afric a Fixed + mobile s ubs c ribers Internet us ers Ratio of girls to boy s in primary & s ec ondary educ ation (..) No te: Figures in italics are fo r years o ther than tho se specified. .. indicates data are no t available. 10/15/12 Develo pment Eco no mics, Develo pment Data Gro up (DECDG). 72 Annex 6: Gambia MDG Progress MDGs Monitoring Targets and Indicators  The Gambia�rating     Year when the MDG  Between which  can be expected to  MDG 1: Eradicate Extreme Poverty and Hunger by 2015  Classification  years might meet  be met  Comments  the MDG  (extrapolating  1) indicator growth)   A. Halve  between  1990  and  2015  the  proportion  of  people  whose income is less than $1.25/day.  Indicator: Poverty headcount ratio at $1.25 a day (PPP) (% of  population)  Met  <2012  2008     C.  Halve  between  1990  and  2015  the  proportion  of  people  who  Stagnation between 2000 and 2006, which is  suffer from hunger.  latest observation.  Earliest observation 1996.   Indicator: Malnutrition prevalence, weight for age (% of  Progress calculated on 2000�2006 change  children under 5)  Seriously Off Target  >2030  ∞  which was negative  Stagnation between 2008 and 2011. Progress  Indicator: Prevalence of undernourishment   calculated over the period 2005�2011 shows  (% of population)  Insufficient Progress  2015�2020  2018  promising results  MDG 2: Achieve universal primary education              A.  Ensure  that  by  2015  children  everywhere,  boys  and  girls  alike, will be able to complete a full course of primary schooling  Stagnation between 2008 and 2011; Return to  Indicator: Primary NON�completion rate, total   improvements made up to 2008 would make  (% of relevant age group)   Seriously Off Target  >2030  2170  MDG achievable by 2020  MDG 3: Promote Gender Equality and Empower Women              Eliminate Gender disparity in primary and secondary education,  preferably by 2005, and  a t all levels of education no later than  2015.  Indicator: Ratio of girls to boys gross enrollment in primary and  secondary education (%)  Met  <2012  2010     Indicator: Ratio of girls to boys gross enrollment in primary  education (%)  Met  <2012  2011     MDG 4: Reduce child mortality              A.  Reduce  by  two  thirds,  between  1990  and  2015,  the  under� five mortality rate   Indicator: Mortality rate, under�5 (per 1,000 live births)  Seriously Off Target  >2030  2036     Indicator: Mortality rate, infant (per 1,000 live births)  Seriously Off Target  >2030  2091     73 Indicator: Measles vaccination rate   (% of children ages 12�23 months)  Seriously Off Target  >2030  2032     MDG 5: Improve maternal health              A.  Reduce  by  three�quarters,  between  1990  and  2015,  the  maternal mortality rate.   Maternal mortality ratio (modeled estimate, per 100,000 live  births)  Moderately Off Target  2020�2030  2029  Continuous progress made, but not enough  B. Achieve by 2015 universal access to reproductive health Stagnating between 2006 and 2010. progress  Indicator: Births NOT attended by skilled health staff (% of  calculated on 2006�2010 change which was  total)   Seriously Off Target  >2030  ∞  negative  MDG 6: Combat HIV/AIDS, malaria and other diseases              A. Halve by 2015 and begun to reverse the spread of HIV/AIDS Prevalence rates remained constant on low  Indicator: Prevalence of HIV, total   level between 2007 and 2010, but increased  (% of population ages 15�49)  Seriously Off Target  >2030  ∞  again in 2011  MDG 7: Ensure environmental sustainability              C.  Halve  by  2015  the  proportion  of  people  without  sustainable  access to safe drinking water and basic sanitation  Indicator:  Improved  water  source  (%  of  population  without  access)   Met  <2012  2010     Indicator: Improved sanitation facilities (% of population  without access)   Seriously Off Target  >2030  2048  Progress made but in small increments   Source: Preliminary Estimates for the World Development Indicators 2013, the World Bank.   1) Projections proposed have been modeled based on progress made in the latest available 5 year period. This reflects the assumption that the latest five year period and consequently a time span that starts after the adoption of the Millennium Declaration (2001) and the Monterrey Consensus (2002) provides a more adequate picture of the impact of the MDGs on policies implemented and respective donor support received by a current government or its immediate predecessor. Projections on MDG progress on this basis indicate the prospects of achieving the targets, in case most recent policies were continued to be implemented in the same way in the years to come – and/or donor support in a respective sector would be maintained at the current level. These projections also reflect more accurately any backdrops due to more recent events; i.e. the 2011 Sahel drought and related food crisis might have contributed to seriously delaying progress on MDG 1: undernourishment.``      The category Met indicates that the MDG has already been met.    The category Sufficient Progress to be met by 2015 indicates that last observed five year annual growth rate indicates that MDG is on track to be met if growth rate is maintained;    The category Insufficient progress is defined as being able to meet the MDG between 2015 and 2020    The category Moderately off target indicates that MDG might be able to meet between 2020 and 2030    The category Seriously off target indicates that MDG will not be met even by 2030 or a reversal in progress has occurred    The category Insufficient data is defined as having not enough data points to be able to estimate 5 year progress or that the starting value is missing  74 Annex 7: B2 - Selected Indicators* of Bank Portfolio Performance and Management CAS Annex B2 - Gambia, The Selected Indicators* of Bank Portfolio Performance and Management As Of Date 25/02/2013 Indicator 2010 2011 2012 2013 Portfolio Assessment Number of Projects Under Implementation a 3 3 4 3 Average Implementation Period (years) b 2,7 2,3 2,5 4,0 Percent of Problem Projects by Number a, c 0,0 0,0 0,0 33,3 Percent of Problem Projects by Amount a, c 0,0 0,0 0,0 39,0 Percent of Projects at Risk by Number a, d 0,0 0,0 0,0 33,3 Percent of Projects at Risk by Amount a, d 0,0 0,0 0,0 39,0 Disbursement Ratio (%) e 67,4 54,3 20,4 20,2 Portfolio Management CPPR during the year (yes/no) Supervision Resources (total US$) Average Supervision (US$/project) Memorandum Item Since FY 80 Last Five FYs Proj Eval by OED by Number 27 3 Proj Eval by OED by Amt (US$ millions) 285,1 44,8 % of OED Projects Rated U or HU by Number 48,1 66,7 % of OED Projects Rated U or HU by Amt 41,2 56,6 a. As shown in the Annual Report on Portfolio Performance (except for current FY). b. Average age of projects in the Bank's country portfolio. c. Percent of projects rated U or HU on development objectives (DO) and/or implementation progress (IP). d. As defined under the Portfolio Improvement Program. e. Ratio of disbursements during the year to the undisbursed balance of the Bank's portfolio at the beginning of the year: Investment projects only. * All indicators are for projects active in the Portfolio, with the exception of Disbursement Ratio, which includes all active projects as well as projects which exited during the fiscal year. 75 Annex 8: IBRD/IDA Program Summary CAS Annex B3 – The Gambia IBRD/IDA Program Summary As Of Date 25/02/2013 Proposed IBRD/IDA Base-Case Lending Program a Fiscal Strategic Rewards b Implementation b Proj ID US$(M) year (H/M/L) Risks (H/M/L) 2014 GM - Budget Support - DPL 2 6.0 GM - IFMIS - AF 6.0 GM Nutrition and Health Project 3.0 GM-Quality of Basic Education 12.7 GM: Commercial Agriculture & Value Chain 14.0 Result 41.7 Overall Result 41.7 76 Annex 9: IFC Program Annex B3 – The Gambia IFC Investment Operations Program 2010 2011 2012 2013* Original Commitments (US$m) IFC and Participants 0.00 4.83 IFC's Own Accounts only 0.00 4.83 Original Commitments by Sector (percent)- IFC Accounts only FINANCE & INSURANCE 100 100 Total 0 100 100 0 Original Commitments by Investment Instrument (percent) - IFC Accounts only Guarantee 100 100 Total 0 100 100 0 * Data as of February 01,2013 77 Annex 10: B4-Summary of Non-Lending Services CAS Annex B4 – The Gambia Summary of Non-lending Services Completion Cost Product FY (US$000) Audiencea Objectiveb Recent completions Strengthening Capacity to Improve Nutrition Outcomes FY12 Government Knowledge Generation, Problem Solving The Gambia: # 10011 Strengthening the Framework of Accounting & Auditing MTDS Gambia FY12 Government Knowledge Generation, Problem Solving Knowledge Generation, TA to Support Gambia Connectivity FY11 Government Problem Solving Gambia Reform Plan FY11 Government Gambia Education CSR FY11 Knowledge Generation, Government Problem Solving Energy Policy Note FY11 Government Knowledge Generation, Public Expenditure Review FY11 Government Problem Solving Impact Evaluation of the GM CDDP FY11 Underway Knowledge Generation, Gambia Governance Support –TA FY13 Government Problem Solving Senegal, Gambia Economic Analysis FY13 Knowledge Generation, Government Problem Solving GM Support to Public Accounts FY13 Committee (IDF) Government Knowledge Generation, Planned Multi-sector study on Sources of Growth, Business environment and Labor markets IDF for Civil Service Reform GM Statistics TA GM Trade Logistics TA (TFF) GM: Financial Sector TA (FIRST) GM: PPP Development TA (PPIAF) GM Teaching Math and Physics through e- learning GM Improving Parental Investments in Children GM-National Language Pilot TA GM HD Policy dialogue GM Energy Sector Dialogue GM GDLN GM Customs Assessment Trade Toolkit PEFA Assessment 78 Annex 11: B6-Key Economic Indicators Update from LDB Gambia, The - Key Economic Indicators Actual Estimate Projected Indicator 2007 2008 2009 2010 2011 2012 2013 2014 2015 National accounts (as % of GDP) a Gross domestic product 100 100 100 100 100 100 100 100 100 Agriculture 22 27 28 31 20 24 27 27 27 Industry 15 14 13 13 14 14 13 13 13 Services 63 59 59 56 66 63 60 60 60 Total Consumption 94 101 97 97 99 101 99 98 96 Gross domestic fixed investment 19 15 20 21 19 20 19 20 20 Government investment 5 4 8 9 9 10 10 10 11 Private investment 14 11 12 12 11 11 10 9 9 b Exports (GNFS) 29 23 25 23 29 28 28 28 28 Imports (GNFS) 42 40 42 42 47 50 46 45 45 Gross domestic savings 6 -1 3 3 1 -1 1 2 4 c Gross national savings 11 3 7 5 4 4 5 6 7 Memorandum items Gross domestic product 799 966 901 952 898 .. .. .. .. (US$ million at current prices) GNI per capita (US$, Atlas method) 460 540 600 630 620 .. .. .. .. Real annual growth rates (%, calculated from 04 prices) Gross domestic product at market prices 3.6 5.7 6.4 6.5 -4.3 3.9 10.7 6.5 5.5 Gross Domestic Income 3.6 5.7 6.4 6.5 -4.3 3.9 10.7 6.5 5.5 Real annual per capita growth rates (%, calculated from 04 prices) Gross domestic product at market prices 0.8 2.8 3.6 3.7 -6.9 .. .. .. .. Total consumption 6.6 11.3 -0.9 4.5 -7.0 .. .. .. .. Private consumption 7.3 9.9 -1.0 4.3 -7.1 .. .. .. .. Balance of Payments (US$ millions) b Exports (GNFS) 215 236 250 267 286 304 323 .. .. Merchandise FOB 91 87 95 96 111 104 113 124 137 b Imports (GNFS) 320 384 413 444 472 500 531 .. .. Merchandise FOB 263 309 296 312 335 362 362 381 404 Resource balance -105 -148 -163 -177 -186 -196 -208 .. .. Net current transfers .. .. .. .. .. .. .. .. .. Current account balance -80 -112 -110 -111 -117 -120 -128 .. .. Net private foreign direct investment 81 70 73 71 75 79 83 .. .. Long-term loans (net) 6 27 38 43 35 30 22 .. .. Official 20 25 21 24 -1 34 41 16 -3 Private -13 2 17 19 35 -4 -19 .. .. Other capital (net, incl. errors & ommissions) 16 -15 15 2 7 17 29 .. .. d Change in reserves -23 29 -16 -5 0 -5 -6 .. .. Memorandum items Resource balance (% of GDP) -13.2 -15.3 -18.1 -18.6 -20.7 .. .. .. .. Real annual growth rates ( YR04 prices) Merchandise exports (FOB) .. .. .. .. .. .. .. .. .. Primary .. .. .. .. .. .. .. .. .. Manufactures .. .. .. .. .. .. .. .. .. Merchandise imports (CIF) .. .. .. .. .. .. .. .. .. (Continued) 79 Gambia, The - Key Economic Indicators (Continued) Actual Estimate Projected Indicator 2007 2008 2009 2010 2011 2012 2013 2014 2015 e Public finance (as % of GDP at market prices) Current revenues 18.5 19.3 20.2 20.7 22.8 22.8 21.4 .. .. Current expenditures 13.0 13.2 13.0 12.5 13.8 14.0 13.3 .. .. Current account surplus (+) or deficit (-) 5.5 6.1 7.2 8.2 9.0 8.8 8.1 .. .. Capital expenditure 5.3 8.3 10.2 10.9 10.7 10.4 9.6 .. .. Foreign financing 0.8 2.9 3.8 3.9 3.2 2.6 2.0 .. .. Monetary indicators M2/GDP 41.6 43.8 43.3 43.4 48.5 49.2 46.4 .. .. Growth of M2 (%) 6.7 13.4 10.9 11.3 10.9 10.4 10.0 .. .. Private sector credit growth / 47.1 48.7 54.5 64.9 57.1 70.3 74.8 .. .. total credit growth (%) Price indices( YR04 =100) Merchandise export price index .. .. .. .. .. .. .. .. .. Merchandise import price index .. .. .. .. .. .. .. .. .. Merchandise terms of trade index .. .. .. .. .. .. .. .. .. f Real exchange rate (US$/LCU) 59.0 62.5 56.7 55.0 50.8 .. .. .. .. Real interest rates Consumer price index (% change) 5.4 4.5 6.1 6.0 4.5 .. .. .. .. GDP deflator (% change) 4.3 2.0 5.2 4.3 3.7 4.7 5.4 5.3 4.8 a. GDP at factor cost b. "GNFS" denotes "goods and nonfactor services." c. Includes net unrequited transfers excluding official capital grants. d. Includes use of IMF resources. e. Consolidated central government. f. "LCU" denotes "local currency units." An increase in US$/LCU denotes appreciation. 80 Annex 12: B7-Key Exposure Indicators Update from LDB Gambia, The - Key Exposure Indicators Actual Estimated Projected Indicator 2007 2008 2009 2010 2011 2012 2013 2014 2015 Total debt outstanding and 700 373 506 512 466 499 538 545 526 a disbursed (TDO) (US$m) a Net disbursements (US$m) 0 0 0 0 0 0 0 0 0 Total debt service (TDS) 10 7 8 7 7 6 7 7 7 a (US$m) Debt and debt service indicators (%) b TDO/XGS .. .. .. .. .. .. .. .. .. TDO/GDP 87.6 38.6 56.2 53.8 51.9 .. .. .. .. TDS/XGS .. .. .. .. .. .. .. .. .. Concessional/TDO 93.4 89.1 75.7 74.9 81.7 81.9 83.7 85.5 88.0 IBRD exposure indicators (%) IBRD DS/public DS .. .. .. .. .. .. .. .. .. Preferred creditor DS/public .. .. .. .. 45.1 .. .. 68.3 73.4 c DS (%) IBRD DS/XGS .. .. .. .. .. .. .. .. .. d IBRD TDO (US$m) .. .. .. .. .. .. .. .. .. Of which present value of guarantees (US$m) Share of IBRD portfolio (%) .. .. .. .. .. .. .. .. .. d IDA TDO (US$m) 219 62 64 65 64 62 60 58 55 IFC (US$m) Loans Equity and quasi-equity /c MIGA MIGA guarantees (US$m) a. Includes public and publicly guaranteed debt, private nonguaranteed, use of IMF credits and net short- term capital. b. "XGS" denotes exports of goods and services, including workers' remittances. c. Preferred creditors are defined as IBRD, IDA, the regional multilateral development banks, the IMF, and the Bank for International Settlements. d. Includes present value of guarantees. e. Includes equity and quasi-equity types of both loan and equity instruments. 81 Annex 13: B8-Operations Portfolio 82 Endnotes: 1 We note that Jan 2012-December 2015 is the strategy period that will be proposed for the JPS, which is the period of The Gambia’s ongoing PRSP (PAGE). Because of the differing FY of the two institutions, there may from time to time be a difference in the FY referred to in some tables for the AfDB and the WB programs. The AfDB FY is concurrent with the calendar year (Jan 1-Dec 31) while the WB FY is July 1 through June 30. 2The President’s Office directly governs at least two ministries, at current: the Ministry of Defense and the Ministry of Energy. Two ministerial positions are currently not assigned: Information & Communication Infrastructure, and Fisheries, Water Resources and National Assembly Matters, and seem to be covered by the Office of the President, as well. 3 The basic primary balance excludes expenditures financed by projects, grants and external borrowing, as well as interest payments. 4 The risks associated with the external debt are perceived as limited given that amortizations are gradual and interest rates are very low. 5 Millet crop production grew at an average of 3.5%/year from 2005-9. Maize (growth of 17%/year during the same period) and rice (as high as 82% /year) have shown particularly high growth. (see Draft Agricultural Sector Policy Note by WB. May 2011). 6These species include, for example, nesting and migratory birds and marine turtles, the eggs of which are frequently collected; sharks, harvested for their fins; and manatees, hunted for meat, as well as growing conflicts between the population and species such as hippopotamus as the two are increasingly forced to depend upon the same resources for survival. 7The President’s Office directly governs at least two ministries, at current: the Ministry of Defense and the Ministry of Energy. Two ministerial positions are currently not assigned: Information & Communication Infrastructure, and Fisheries, Water Resources and National Assembly Matters, and seem to be covered by the Office of the President, as well. 8 48 of the 53 seats of the National Assembly are determined by direct elections, and five through nomination by the President. The APRC won 43 of the 48 seats determined by direct elections. 9The African Union observer mission came to the conclusion that the elections were conducted in accordance with the legal and constitutional framework of The Gambia and with the Durban Declaration on the Principles Governing Democratic Elections in Africa – even though the mission made several observations and issued a number of recommendations on how to improve the process. ECOWAS - the Economic Community of West African States - had neither sent observer missions to the 2011 Presidential nor to the 2012 Parliamentary elections, as the institution deemed that the situation was not conducive to a "free, fair and transparent" poll. The Government of The Gambia (GoTG) strongly condemned this decision. 10The Gambia’s rank in the 2012 Transparency International Corruption Perceptions Index is 105 (out of 174), a sharp decline vis-à-vis its rank in the 2011 Index which was 77 (out of 182). 11The reform followed a Procurement Assessment Report (CPAR) carried out by the World Bank in 1998. 12Efforts have included the increase in the number of courthouses, the appointment of more judges, and the establishment of institutions such as the Law Reform Commission, as well as ways to improve access to justice for the poor, for example through the creation of an Alternative Dispute Resolution System and the establishment, by an Act of Parliament, of a functioning government-funded National Legal Aid Agency to support the needs of litigants (including children) that cannot afford the services of attorneys. Both have played a major role in addressing the needs of Gambians with respect to access to justice and led to a reduction in the backlog in the courts. 13Between 2006 and 2011, the Gambia’s overall governance quality deteriorated according to the Mo Ibrahim assessment, with large variations on the individual sub-indicators: During this period, there have been visible improvements in the areas of “Sustainable Economic Opportunity� (+4.8) and “Human Development� (+5.8) whereas the areas of “Safety & Rule of Law� (-7.9) and “Participation & Human Rights� (-8.6) registered significant declines. The Gambia is ranking highest in Welfare (12th) and the Rural Sector (14th) and lowest in Accountability (37th) and Rights (41st). The Freedom in the World 2012 report score on political rights decreased from 5 to 6 (out of 7) as compared to 2011, and remained on the low level of 5 for civil liberties, which changed the country’s status in this report from “partly free� to “not free�. 14Progress included, for example, the elaboration of capacity needs assessments and strategic plans for 10 government agencies, and the recruitment of international and national UNVs to fill critical capacity gaps. The National Assembly was equipped with an E-Library and a system to digitalize the recordings of National Assembly and Committee 83 Endnotes: meetings. The legal framework has been updated, including the Public Service Act, General Orders, Public Service Regulations, the Civil Service Code of Conduct, and Surety Bonds. A Government web portal has been established linking 22 agencies and improving communications with Gambia’s diplomatic missions abroad. 15 This rate compares favorably by the sub-Sahara African average of 39%, but is still considerably higher than the 16% (2012) in neighboring Senegal. Acute malnutrition remains stubbornly close to the WHO threshold criteria of 10% for targeted relief interventions. In 2010, the rate was estimated at 9.5% (as compared to 8.9% back in 2000, Senegal’s 8.8% in 2012, and a sub-Sahara African average of 9%). Work to improve the nutrition of the population continues (see below para 24) 16 The average HIV/IDS prevalence rate conceals large differences amongst young men and women aged 15 to 24, however, with rates amongst young women (1 percent) more than double the rate amongst men (0.4 percent). The estimated antiretroviral coverage for both genders continues rising, nevertheless, doubling to 18 percent in 2007 compared to 9 percent in 2004. These figures include expectant mothers living with HIV/AIDS, who saw their antiretroviral coverage increase by over 50 percent between 2005 and 2007. 17 According to UNAIDS, the HIV prevalence in West and Central Africa remains comparatively low, with the adult HIV prevalence estimated at 2% or under in 12 countries in 2009 (Benin, Burkina Faso, Democratic Republic of the Congo, Gambia, Ghana, Guinea, Liberia, Mali, Mauritania, Niger, Senegal, and Sierra Leone). 18 Estimations from 2010 Integrated Household Budget Survey jointly conducted by the Gambia Bureau of Statistics (GBoS) and the National Planning Commission (NPC), and facilitated by the United Nations Development Program (UNDP). The poverty headcount ratio was measured at US$ 1.25. 19 The poverty lines used here are not entirely consistent: The poverty assessments in 2003 and in 2010 used different methodologies, estimating poverty in 2003 at the US$1 and in 2010 at the US$1.25 lines. The Bank team assumes that $1.25 in 2010 was roughly the same as $1 in 2003, implying inflation of about 3% per annum which is not too far off - hence there is a limited comparability. 20 The ratio of consumption in the top quintile compared to the bottom quintile is estimated at 8.3, as compared to 6.9 in Senegal. 21 Women constitute 45 percent of the economically active population, with a labor force participation rate of 72 percent, compared to 83 percent for males. 22 See: Gender Profile for The Gambia, AfdB 2011; and The Gambia Youth Employment and Skills Development Study: Improving Youth Employment Opportunities Through Enhanced Skills Development, World Bank 2010. 23 Access to finance has been made more difficult recently because of the crowding out of the domestic financial market by substantial T-bill emissions by the government to finance debt obligations. The Micro-Finance sector operates without regulations which put clients at risk and obliges them to accept loans at very high costs. Formal credit to the agriculture sector heavily depends on commercial banks, which mostly limit their exposure to large, short-term loans for groundnut trading. 24 The steady and drastic decline in NAWEC’s financial performance was triggered to a large degree by the rise in crude oil prices (the country's main fuel for power generation) from 2008 onwards for which NAWEC was unable to raise offsetting revenues. 25 This is in line with international research findings showing the link between land ownership and related incentives for more substantial investments on land, and productivity. The World Bank is currently planning to undertake more detailed analytical study on land governance in several countries in the sub-region, including in The Gambia. 26 Other measures put in place to support the quality of teaching included additional learning opportunities for primary teachers at the Gambia College, improved content knowledge through long distance learning and strengthened supervision of teaching practice for student teachers. Progress has also been made in addressing teacher supply. 27 The IFMIS currently produces in-year fiscal reports with an average lag of one month and reconciles most banking and fiscal records also on a monthly basis. In particular, the IFMIS system has permitted the closer control of the status of budget execution and of spending levels; an enhanced management of ministerial resources due to the access to real time information on the status of their budgets; a strengthened sectoral allocation, planning, and analysis; and greater effectiveness in Government expenditure programs by identifying cost-drivers in program activities. An IFMIS interface at the Central Bank has been established, ensuring real-time information on budget financing shortfalls and on the timing of needed public domestic borrowing, and efforts are being made to regularize the Human Resource records of central government employees on the IFMIS payroll. 28 The Government financial statements for 2008, 2009, and 2010 have been submitted to the National Audit Office. 84 Endnotes: 29 This was confirmed following a World Bank mission in December 2011 which found that progress since the 2005 CPIP had been limited, and the Public Procurement system is still far from being fully operative in accordance with the Act. 30 African Development Bank Group: The Gambia: Country Gender Profile, October 2011. The Gender Profile aimed at the following: (i) Identify key gender inequalities that pose a challenge to poverty reduction and development; (ii) assess existing policy and legal frameworks; (iii) examine gender gaps and opportunities for the promotion of gender equality in the priority sectors; (iv) examine the institutional capacity for advancing gender equality and empowerment of women both in government and the civil society; and (v) make recommendations for accelerating the advancement of gender equality and the social and economic empowerment of women and their equal participation in decision- making. 31 Jit Gill Memorial Award for Outstanding Public Service 32 In this context the team is building on the conclusions of the World Bank 2012 Global Monitoring Report on “Food Prices, Nutrition and the Millennium Development Goals�. 33 As discussed the recent World Bank report on “Improving Nutrition through Multi-sectoral Issues�, there are opportunities in food security and agricultural projects to improve nutrition at the household level, however, the operational parameters are often poorly understood. 34More specifically, it is envisioned to extend IFMIS to include all Self-Accounting (donor-funded) projects, an interface with Central Bank System to implement Electronic Funds Transfer (EFT) as a part of fully automated Treasury Single Account (TSA) operations, implementation of the HR Recruitment Management Module for the entire Government, capacity building in Professional Accounting and Information Technology, for example. 35 The IDA resource envelope estimate is updated annually updated annually based on the respective country allocation parameters. The allocation is currently firm for FY12 (SDR 9 million) and FY 13 (SDR 11.1 million) and indicative for FY14 (SDR 9.7 million). The FY14 final allocation may vary depending on: (i) total IDA resources available, (ii) the country’s performance rating, GNI per capita, and population; (iii) the terms of IDA assistance (grants/credits) and the allocation deductions associated with MDRI annual debt service foregone; (iv) the performance, other allocation parameters, and IDA assistance terms for other IDA borrowers; and (v) the number of IDA-eligible countries. IDA17 estimated resources are based on the average IDA16 annual allocations; the actual allocations for IDA17 will vary depending on resources available and on the outlined allocation criteria. Also, IDA allocation are provided in SDR terms, while the US dollar equivalent amount is provided at the exchange rate of US$1.50233/SDR, the exchange rate for each operation depends on the applicable prevailing rate at the time of approval. The (indicative) IDA-16 resource allocation (SDR29.8 m equivalent to US$44.7 m) for The Gambia has considerably increased as compared to IDA-15 (SDR12 m). 36 The Government’s Education Program is now supervised jointly under Government leadership by all donors involved. 37Had the peg been fully enforced and maintained, the Central Bank would have likely seen a rapid drawdown of foreign exchange reserves and the drying up of the foreign exchange market with significant implications on trade activity including tourism, transit trade and government budget revenues tied to trade. 38 Revised outcomes, following the Mid-term Progress Report 39 GIEPA operations were temporarily suspended in 2009 because of institutional changes. 40 ‘Hot’ day or ‘hot’ night is defined by the temperature exceeded on 10% of days or nights in current climate of that region and season. 85