Document of The World Bank FOR OFFICIAL USE ONLY Report No. 96724-CG INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL FINANCE CORPORATION AND MULTILATERAL INVESTMENT GUARANTEE AGENCY PERFORMANCE AND LEARNING REVIEW OF THE COUNTRY PARTNERSHIP STRATEGY FOR THE REPUBLIC OF CONGO FOR THE PERIOD FY13-FY16 October 30, 2015 Congo Country Management Unit, AFCC2 Africa Region The International Finance Corporation (IFC) The Multilateral Investment Guarantee Agency (MIGA) This document has a restricted distribution and may be used by recipients only in performance of their official duties. Its contents may not otherwise be disclosed without World Bank Group authorization. Date of the last Country Partnership Strategy: November 1, 2012 FISCAL YEAR [January 1- December 31] CURRENCY EQUIVALENTS (as of October 21, 2015) Currency Unit CFAF 1,000 = US$1.70 CFAF 577.73 = US$1 SDR 1.00 = US$1.41 ABBREVIATIONS AND ACRONYMS AF Accord de Financement (Financial Agreement) AFD Agence Française de Développement (French Agency for Development) AfDB African Development Bank ARMP Autorité de Régulation des Marchés Publics (Public Procurement Authority) ASA Advisory Services and Analytics BEAC Banque des Etats de l’Afrique Centrale (Bank for Central African States) CEMAC Communauté Economique des Etats de l’Afrique Centrale (Central African Economic and Monetary Community) CFAF Communauté Financière Africaine Franc (African Financial Community Franc, Currency) CG Congo (Republic of Congo) CPF Country Partnership Framework CPS Country Partnership Strategy DGCMP Direction Générale du Contrôle des Marchés Publics (Public Procurement Directorate) DSA Debt Sustainability Analysis ECOM Enquête Congolaise auprès des Ménages pour le Suivi et l’Evaluation de la Pauvreté (Poverty Survey) EDF Electricité de France (French electricity Utility) EI-TAF Extractive Industries Technical Advisory Facility EITI Extractive Industries Transparency Initiative ERP Emissions Reductions Program ERPA Emissions Reductions Payment Agreement ESW Economic and Sector Work EU European Union FASA Financial Advisory Services Agreement GDP Gross Domestic Product HIPC Heavily Indebted Poor Countries HRIF Health Results Innovation Fund IBRD International Bank for Reconstruction and Development ICT Information and Communication Technology i IDA International Development Association IFC International Finance Corporation IMF t International Monetary Fund MDRI The Multilateral Debt Relief Initiative METPFQE Ministère de l'Enseignement Technique, Professionnel, de la Formation Qualifiante et de l'Emploi (Ministry of Technical and Professional Education, Qualifying Training and Employment) MIGA Multilateral Investment Guarantee Agency MSMEs Micro, Small, and Medium Enterprises MTEF Medium-Term Expenditure Framework NDP National Development Plan OHADA Organisation pour l’Harmonisation en Afrique du Droit des Affaires (Organization for Harmonization of Business Law in Africa) PADE Projet d’Appui à la Diversification de l’Economie (Support to Economic Diversification Project) PBF Performance-based Financing PEMFAR Public Expenditure Management and Financial Accountability PER Public Expenditure Review PFM Public Financial Management PLR Performance and Learning Review PNAS Politique Nationale d’Action Sociale (National Social Action Policy) PP Percentage Points PPD Public and Private Dialogue PPP Public-Private Partnership PRAEBASE Programme d’appui à l’éducation de base (Support Program for Basic Education) PRCTG Projet de Renforcement des Capacités de Transparence et de Gouvernance (Transparency and Governance Capacity Building Project) RAS Reimbursable Advisory Service RoC Republic of Congo SCD Systematic Country Diagnostic SMEs Small and Medium Enterprises SNDE Société Nationale de Distribution d’Eau (National Water Utility) SNE Société Nationale d’Electricité (National Electricity Utility) STEM Science, Technology, Engineering, and Mathematics UCS Use of Country Systems UN United Nations WB World Bank WBG World Bank Group IDA IFC MIGA Vice President: Makhtar Diop Nena Stoiljkovic Keiko Honda Director: Ahmadou Moustapha Ndiaye Vera Songwe Ravi Vish Task Team Leader: Sylvie Dossou Olivier Nour Noel Conor Healy ii Acknowledgements The core team was composed of: Sylvie Dossou, Djibrilla Adamou Issa, Yisgedullish Amde, Emmanuel Pinto Moreira, Jean Christophe Carret, Luc Laviolette, Alema Siddiky and Zafar Ahmed. Support was provided by Nadege Bicoumou and Amina Temanda. Substantive inputs were received from: Amadou Oumar Ba, Mahine Diop, Sidy Diop, Bella Diallo, Clement Tukeba, Mouhamadou Hayatou, Fulbert Tchana Tchana, Etaki Wa Dzon, Conor Healy (MIGA), Frank Douamba, Olivier Nour Noel (IFC) and OPCS. iii Performance and Learning Review of the Country Partnership Strategy for Republic of Congo TABLE OF CONTENTS I.  INTRODUCTION .......................................................................................................................... 1  II.  MAIN CHANGES IN COUNTRY CONTEXT .......................................................................... 1  A.  Political Context ............................................................................................................................. 1  B.  Poverty Reduction and Shared Prosperity .................................................................................. 2  C.  Macroeconomic and Debt Developments ..................................................................................... 2  D.  New and Emerging Development Issues ...................................................................................... 3  III. SUMMARY OF PROGRAM IMPLEMENTATION ................................................................ 4  A.  Portfolio Performance ................................................................................................................... 4  B.  Partnership and Leveraging ......................................................................................................... 6  C.  Progress toward CPS Objectives .................................................................................................. 6  D. Emerging Lessons.......................................................................................................................... 10  IV. ADJUSTMENTS TO THE COUNTRY PARTNERSHIP STRATEGY ................................ 10  Adjustments to Pillar I: Competitiveness and Employment .......................................................... 12  Adjustments to Pillar II: Vulnerability and Resilience .................................................................. 13  Adjustments to Pillar III: Capacity Building and Governance ..................................................... 14  Indicative Program ............................................................................................................................ 14  V.  RISKS TO THE CPS PROGRAM ............................................................................................. 16  VI. ANNEXES..................................................................................................................................... 18  Annex 1: Updated CPS Results Matrix............................................................................................ 18  Annex 2: Republic of Congo: Changes to CPS Results Matrix ..................................................... 28  Annex 3: Republic of Congo: Results Matrix: Progress towards CPS Objectives ...................... 37  iv Annex 4: Republic of Congo: Macroeconomic Indicators (2012-2017) ........................................ 51  Annex 5: Operational Portfolio ........................................................................................................ 52  Annex 6: Selected Indicators of Bank Portfolio .............................................................................. 53  LIST OF TABLES Table 1: Assessment of Progress on Original CPS Indicators ........................................................ 7 Table 2: Indicative CPS Program FY15-FY17 .............................................................................. 15 Table 3: Revised Systematic Operations Risk Rating Tool .......................................................... 16 v I. INTRODUCTION 1. This Performance and Learning Review (PLR) discusses the performance of the World Bank Group (WBG)1 program, lessons learned, and adjustments made to the Republic of Congo (RoC) Country Partnership Strategy (FY13-FY16) to respond to new developments. The PLR also looks at how well the CPS furthers the WBG twin goals. It proposes extension of the current CPS to the end of FY17 to align with the government political and programmatic cycle as the country will have Presidential elections in 2016. The extended time period will allow the country team to also consolidate the results and conduct the analytical work for the Systematic Country Diagnostic (SCD) that will inform the preparation of the next strategy. 2. The total indicative envelope for the RoC under IDA 17 is estimated to be US$54.4 million, while it currently stands at about US$130 million in investment lending for IBRD in FY16 (see paragraph 4 on IBRD). 3. The relevance of the CPS is accentuated by recent developments in the oil market. The strategic focus will continue to be on (i) competitiveness and employment; (ii) vulnerability and resilience; and (iii) good governance and capacity building—which is the foundation. The recent plunge in oil revenues underscores the importance to RoC of diversification and using public resources more efficiently to achieve better results. The results indicators show progress has been mixed and some of the indicators have been refined and adjusted to take into account performance and prospects. These revisions also reflect new engagements to align the program more closely with the twin goals through projects on urban infrastructure, skills development, agriculture, delivery of health services (performance-based financing), the safety net, and the efficiency and quality of education. 4. IDA resources have been well-leveraged with government counterpart funding but the situation may change. This approach is coming under stress because of the drop in oil revenues and the following alternatives are developed: (i) access to IBRD funding since October 2013 is enabling the WBG program to launch new engagements in select areas; (ii) the WBG will explore complementary funding mechanisms through closer collaboration with IFC, and development of public-private partnerships (PPPs) to fund large infrastructure projects; and (iii) the WBG will continue to work towards the current objectives, concentrate on improving implementation and limit new initiatives to those that have already begun. II. MAIN CHANGES IN COUNTRY CONTEXT A. Political Context 5. Since the adoption of a new constitution in 2002, the RoC has been relatively stable. Incumbent President Sassou Nguesso, who first came to power in 1978, won the July 2009 presidential election, securing a new seven-year term, up to 2016. A referendum for the adoption of a new Constitution was held on October 25, 2015. Under the amendment, a presidential term could be "twice renewed", and the upper-age limit of 70 for presidential candidates is cancelled. 1 The current CPS is not a joint CPS with the Bank and IFC. However, IFC activities in Congo are reflected in the document. 1 This constitutional change will give the current President the legitimacy to run for a third term in the next presidential elections due to be held in 2016. B. Poverty Reduction and Shared Prosperity 6. Although the poverty ratio has fallen slightly, between 2005 and 2010 the number of poor went up by 0.1 million. Estimates comparing the 2005 and 2011 Poverty Survey (ECOM) show that the headcount ratio dropped from 50.7 percent in 2005 to 46.5 percent in 2011. Poverty was reduced primarily in urban areas, with the headcount dropping by 13 percentage points in Brazzaville and 8 percentage points in Pointe Noire. In contrast, during the same period, rural poverty increased by 10 percentage points. Meanwhile, GDP per capita grew by 77.8 percent in this period to stand at US$3,238 in 2014, for a growth elasticity of poverty of – 0.11. The limited responsiveness of poverty to macroeconomic growth may partly be attributed to the fact that the structure of public spending did not help the poor to build up assets. 7. However, prosperity appears to have been shared to some degree with the poorest segments of the population. In fact, poverty declined in RoC but at a rate that did not reflect the economic growth of the last few years. In real terms annual consumption of the bottom 40 percent grew at an average annual rate of 1.5 percent; however, the methodology changed between the two surveys, so that the data need to be confirmed by rigorous analysis of both databases. Some of the assumptions made during elaboration of the 2011 consumption aggregate may be driving some of the main survey findings. The Bank is currently preparing a poverty assessment, which will thoroughly investigate these data issues. This poverty assessment will be completed in the third quarter of FY16. C. Macroeconomic and Debt Developments 8. Driven by the poor performance of the oil sector, the recent growth trend is far below the expectations on which the 2012–16 National Development Plan (NDP) is based. From 2012 to 2014, the country’s annual growth rate averaged 4.4 percent, far below the 8.5 percent NDP target. The downturn in oil production mainly (which accounts for more than 60 percent of RoC GDP, three-fourths of government revenues, and nine-tenths of total exports) explains this shortfall in outcomes. In fact, in the last three years, oil production declined sharply, mainly due to interruptions in some offshore wells. 9. The sharp increase of public infrastructure investment has contributed to the positive performance of non-oil sectors and counterbalanced oil sector disappointments. In recent years, non-oil sectors have contributed more to the growth of the economy than the oil sector. In fact, during the past three years, non-oil sectors grew at an average annual rate of 8 percent— mainly due to boom in public infrastructure investment. Between 2012 and 2014, public investments increased steadily, creating favorable conditions and positive externalities for private investment, which also was growing increasingly. The contribution of the non-oil sectors to overall growth, however, was muted since combined they represented only about one-third of GDP. 10. Thanks to both higher oil prices and the reaching of HIPC (Heavily Indebted Poor Countries) completion point, RoC accumulated large budget surpluses in the last decade; however, it posted a fiscal deficit in 2014. In 2012 and 2013, the fiscal surplus exceeded 6 percent 2 of GDP. In fact, for the last 10 years, the country maintained a positive primary fiscal balance every year. This has been the result not only of the oil boom and the debt relief after reaching the HIPC completion point, but also policies of public spending that built a budget buffer against downward oil price shocks. But in 2014, with continued growth in expenditures (mainly to boost infrastructure and to prepare the hosting of the 2015 All African Games), and declining oil prices (which led to a steep decline in government revenue2), the deficit rose to 6.1 percent. 11. The economy remains vulnerable to external shocks. The debt situation improved as a result of HIPC/MDRI debt relief in 2010, but could deteriorate in the coming years as the government starts posting fiscal deficits. The debt indicators for RoC are below country-specific debt burden thresholds. However, the September 2015 joint Bank-IMF Debt Sustainability Analyses (DSA) concluded that RoC faces a moderate risk of debt distress. This is a higher risk rating relative to the analysis prepared in the previous year. It confirms the vulnerability of the Congolese economy to external shocks, in particular to declines in oil prices and external demand. 12. GDP growth in RoC for 2015-17 is projected to be modest. During this period, average annual GDP growth is expected to be around 3.5 percent. Projections indicate that the oil sector will grow at an average rate of 4.3 percent, while the non-oil sectors will grow on average at 3.3 percent. The inflation—estimated at less than 2.5 percent—will boost real incomes, but household demand will pick up less robustly because unemployment and indebtedness are still high, and credit standards are tightening. It is expected that government consumption will be contained. However, on average the fiscal deficit is projected to be around 10.5 percent over the next few years. The decline in global oil prices will also affect the current account. Indeed, after three years of stability, RoC’s terms of trade are projected to deteriorate dramatically. D. New and Emerging Development Issues 13. Lower oil revenues are making it harder to manage the economy. The price of Brent crude fell from about US$111/barrel at the end of June 2014 to about US$43/barrel at end-August 2015. Such a drop in oil prices is not unprecedented, but despite the massive reserves RoC has accumulated since 2003 (about 80 percent of the 2013 GDP), the plunge in oil revenue, which accounts for 72 percent of total revenues, will strain the fiscal accounts, and thus the government’s capacity to spend. The Bank estimates that if the oil price falls to an average of US$53.2/barrel in 2015, government oil revenue would sink by 38 percent and total government revenues would be down by 21 percent. The government would then face the issue of continuing the pace of public spending to boost internal demand and growth in the non-oil sector and would seriously deplete its savings. The 2015 budget slashed recurrent expenditure (8.9 percent down from previous year) but investment in infrastructure projects rose by 5 percent. Given that the oil price has fallen below the projected US$70/barrel and that new profit sharing agreements are less favorable to the country, the government prepared a new budget in May 2015 which was approved by the parliament in June 2015. With this new budget, further reduction is requested on capital spending which is expected to decline by about 12 percent. With the new budget, the World Bank team estimates a substantial deficit of about 12.3 percent in 2015. 2 About –10.7 percent. 3 14. Delays in mining production limit the availability of external revenues. The mining sector has suffered delays since 2012. Major iron and potash projects have been held up by infrastructure issues. If the infrastructure gap is not addressed or the international prices of iron and potash drop further, these projects might not get off the ground as quickly as they need to. 15. Sustaining the rhythm of public investment could be difficult. In recent years, China has been the principal source of funding for construction of major infrastructure projects, accounting for 75.8 percent of such financing from 2010 to 2013. Those investments have so far kept non-oil GDP booming impressively. Any disruption in the flow of Chinese funding, whatever the cause, would significantly cloud the growth prospects of the non-oil sector and therefore of total GDP. It would also slow infrastructure construction, which is crucial to improve the investment climate. 16. As investment in infrastructure has increased, efficiency concerns have come to the fore. Efficient investments in infrastructure have the potential to enhance economic diversification by significantly reducing input costs for the country’s productive sectors. However, selection, evaluation, and monitoring of investment projects are not managed efficiently. In addition, difficulties in budget execution and low capacity to absorb the volume of public investment could make government spending less efficient. The challenge for the government is to align the level of public investment with capacity while at the same time bolstering absorptive ability. 17. Urban space management is inefficient and access to services is limited. With more than 70 percent of its people living in or near cities, RoC is one of the most urbanized countries in sub-Saharan Africa. Lack of urban planning, limited investment, and inadequate institutional capacity have compromised RoC’s efforts to manage, regulate, and facilitate effective urban development. As a result, living conditions have gradually deteriorated because of erosion and flooding, land grabs, widening gaps in access to services, and burgeoning slums with limited or no housing. III. SUMMARY OF PROGRAM IMPLEMENTATION A. Portfolio Performance 18. The Bank has delivered a solid program of lending over the past two years. Four new projects totaling US$26.8 million and two additional financings of US$60 million IDA/IBRD resources have been delivered under the current CPS to date. The significant 70 percent government financing provided for current projects is a unique feature of operations in the RoC and reflects the quality of the WBG-government dialogue, with the Bank considered to be a partner that can contribute a unique mix of expertise and knowledge. 19. There are some areas of concern with the portfolio performance. With the most recent (June 30, 2015) closure of the Transparency and Governance Repeat Project, the current portfolio has eight national projects under implementation for a total commitment of US$154.8 million (Annex 5), plus a Regional IDA project (Central African Backbone Project). The share of problem projects (both by number and amount) has declined from the 2013 and 2014 levels (Annex 5). Only one project (Forestry and Economic Diversification) has a Marginally Unsatisfactory rating 4 for Implementation Progress. However, a recent drop in the disbursement rate needs attention. Portfolio activities have been affected by both effectiveness and implementation delays, largely due to slow release of counterpart funds, exacerbated by capacity deficiencies in program implementation units. 20. Until recently a difficult business environment and lack of private sector depth have limited IFC activities in the RoC. However, IFC now has an active business development program underway in the following areas: (i) support for improving the RoC business environment; (ii) provision of integrated support to SMEs; (iii) proactive tracking of infrastructure, manufacturing, and mining developments to identify bankable investment and advisory opportunities; and (iv) development of high-impact Reimbursable Advisory Services (RAS) programs.3 On the investment side, IFC is active in the financial sector through its Global Trade Finance Program and committed a partial credit guarantee for one of the main local banks to support access of SMEs to finance. A risk sharing facility to help fund local contractors of oil major Total Exploration & Production Congo was recently board approved. This project is fully aligned with the Memorandum of Understanding between Total Congo and PADE for local contractor training and capacity building. On the advisory side, IFC is engaged in (i) a public- private partnership (PPP) advisory program for the development of the Sounda dam which may be eligible to the WBG Global Infrastructure Fund; however, implementation of the Project Service Agreement for this key infrastructure project has been delayed as upfront payments due to IFC are still pending; (ii) improving key areas of the investment climate; (iii) the OHADA business law reform program4; (iv) a capacity-building program for local SMEs; and (v) the Health in Africa Initiative. IFC is also involved in the development of a regional Credit Bureau in partnership with BEAC, the regional Central Bank for CEMAC Member States; this regional financial infrastructure-building program is expected to foster access to finance in the Republic of Congo. 21. Though counterpart funding has provided opportunities for undertaking new projects, it also slowed their implementation. This is a countrywide systemic issue common to most government-funded projects that the Bank supports as getting things done gets bogged down in internal bureaucracy and fiduciary requirements. 22. Ambitious project design has caused some problems. Some project designs, particularly for health, economic diversification, and forestry, have not taken into account local considerations and the political economy. Restructuring these projects has significantly delayed progress on the portfolio as a whole. 23. Knowledge products have facilitated dialogue on policy areas. The Bank has introduced knowledge services in such areas as public expenditure review (PER), gender, trade facilitation, public finance, and economic policy. The main findings of the first Economic Update, which were discussed with the government, shed light on inefficiencies in government spending and the likelihood that public investment would have limited impact on long-term growth. A PER of spending on education and health has been designed in order to inform government policies and 3 (a) Implementing the Health in Africa Initiative (HiA) in Congo. (b) Supporting Business Edge projects to improve the performance of SMEs. 4 Organisation pour l'Harmonisation en Afrique du Droit des Affaires (OHADA) harmonizes business law in the 17 African signatories to the OHADA treaty. 5 thus improve the efficiency and effectiveness of expenditures. A gender assessment report provided recommendations for addressing gender differences in access to education and in labor market participation. The work on Public Expenditure Management and Financial Accountability (PEMFAR) has informed and provided guidance to the government strategy for more efficient public financial management (PFM) and procurement. B. Partnership and Leveraging 24. RoC has become eligible for IBRD financing as the country moved from IDA-only to blend status in October 2013. The financing program for FY15 and FY16 is US$45 million and US$130 million in investment lending, respectively. Lending volumes for FY17 will depend on country demand, overall performance in the course of the CPS period as well as global economic developments, which affect IBRD’s financial capacity and demand by other Bank borrowers. IDA resources are used as a catalyst to attract other resources, including those of the government. As a result, all Bank projects for the current CPS are financed jointly, with the government providing up to 70 percent of the total project cost. 25. IFC and the Bank have been working very collaboratively on improving the environment for doing business in RoC. IFC commitment amount in RoC for the duration of the PLR (FY13 to FY17) is about US$50 million. IFC prepared a reform memorandum that served as a basis for the government to prepare a Doing Business action plan. This degree of collaboration needs to be enhanced, especially with regard to building up the capacity of SMEs. Collaboration could also be extended to MIGA in attracting investment, especially financing for major infrastructure projects. C. Progress toward CPS Objectives 26. Progress on CPS goals has been mixed. Of the 28 indicators in the original CPS, 20 (71 percent) have either been achieved or are on track, while eight (29 percent) are off track (table 1). Notable results have been observed in health service delivery, agricultural production, some areas of business regulations, water supply, railway traffic, and regional telecommunications. There has been limited progress on improving energy efficiency, SME development, project selection, procurement, and governance. (See Annex 3 for details). The results framework for the remainder of the CPS period (Annex 1) has been rationalized and adjusted to take into account performance, prospects, and traction towards the outcomes, as well as to improve the focus, definition and measurability of some of the indicators. Seven indicators have been dropped, others consolidated, and 11 new ones added in the revised results framework (these are detailed with explanations in Annex 2). The revisions also take into account the improved alignment of the program with the CPS priorities and themes. The total number of outcomes in the updated results framework is now 10 compared to seven in the original CPS (the number of indicators is now 30 compared with 28 in the original CPS). The revisions also take into account the addition of two new projects (Skills Development for Employability Project and LISUNGI Safety Nets Project) which were approved in response to client demand and emerging priorities as well as due to the proposed extension of the CPS period and the addition of some results areas. 6 Table 1: Assessment of Progress on Original CPS Indicators Indicators Strategic Focus Areas On Off Achieved Track Track Total I. WBG Pillar: Competitiveness and 2 12 2 16 Employment Outcome 1.1: Improved Investment 1 4 1 6 Programming and Infrastructure Management Outcome 1.2: Improved Business Climate .. 6 1 7 Outcome 1.3: Improved Regional 1 .. .. 1 Telecommunications Outcome 1.4: Improved Agricultural Production .. 2 .. 2 II. WBG Pillar: Vulnerability and Resilience 1 1 3 5 Outcome 2.1: Better Health Outcomes 1 1 1 3 Outcome 2.2: Better Education Outcomes .. .. 2 2 III. WBG Pillar: Capacity Building and 1 3 3 7 Governance Outcome 3.1: Improved Transparency and 1 3 3 7 Accountability TOTAL 4 16 8 28 Note: This table represents the stocktaking at the mid-point of the CPS (PLR stage) and summarizes the detailed status presented in Annex 3. Some of the outcomes and indicators are being revised or dropped, and new ones are added as shown in Annex 1. The changes are explained in Annex 2. WBG Pillar I: Competitiveness and Employment 27. Outcome 1.1: Improved investment programming and infrastructure management. Several studies have identified an urgent need for investment to restore the reliability and viability of the electricity sector. Based on their recommendations, Electricité de France (EDF) was contracted to help define a strategy to improve the commercial performance of the power utility, Société Nationale d’Electricité (SNE). The Additional Financing for the Water, Electricity and Urban Development Project will speed up activities to enhance SNE’s technical and managerial performance. In the water sector, a private operator has been recruited and a reliable diagnostic of water utility has led to a better understanding of connection status: water meters are now being used in two cities. Because these initiatives have helped to move the collection ratio up from 47 to 56 percent, achievement of that indicator target is on track. However, the government has not yet met all its financial commitments under the contract it signed with SNDE (Société Nationale de Distribution d’Eau), the water utility. The indicators and milestones for operational and financial performance of the energy and water utilities are on track and already achieved in the case of railway traffic. Among initiatives taken to build up the PFM system, are improving expenditure management using the information technology system and a start on program budgeting. About 55 percent of investment projects are now supported by a feasibility study and the execution rate is up to 70 percent. But because the budget process and programming for investments are still not coordinated, there are significant differences between annual tranches for sectors in the medium- term expenditure framework (MTEF) and investment allocations in each year’s budget. 7 28. Outcome 1.2: Improved business climate. Despite recent steps to improve the investment climate, RoC ranked 178th out of 189 in the 2015 Doing Business Survey. The government has adopted six out of the 26 reforms identified such as to further reduce the time it takes to register a new business, streamline and reduce tax payments,5 and facilitate trading across borders by opening a one-stop shop. A maritime import and export one-stop window is also operational. The related indicators and milestones are on track. Translating improvements in these specific key areas into rapid enhancements of the business environment remains a challenge and also require strengthening of the overall framework. The government has voted into law an action plan to improve the business climate that incorporates a public-private dialog platform. Progress in supporting investment in non-oil private enterprises and value chain development has helped to diversify the economy; however, the indicator is somewhat broadly defined and difficult to measure and attribute. A group of 180 SMEs in seven value chains are benefitting from matching grants to improve managerial capabilities and productivity in agribusiness, wood transformation, mining, transports and logistics, construction materials, arts and crafts, hospitality and tourism. 29. Outcome 1.3: Improved regional telecommunications. The CPS target for increasing the volume of international telecoms traffic (broadband access, cost of services, quality of international bandwidth, etc.) has been achieved. Progress in facilitating telecoms connectivity and promoting the information, communication, and technology (ICT) sector includes strengthening of the regulatory environment as well as infrastructure development. Technical assistance and numerous studies through the Regional telecommunication project have had a positive influence on ICT development in terms of regulation, legal framework, use of PPPs, etc. Construction of the fiber-optic link between Pointe-Noire and Mbinda (on the border with Gabon) started in May 2015 and will take 12 months to be completed. 30. Outcome 1.4: Improved agriculture production. Achievement of the outcome is on track. Milestones have been met in improving market access and increasing food production in targeted areas by smallholders; 1,251 km of rural roads have been rehabilitated; and 36 market infrastructures completed. About 48 percent of the farmers in targeted zones now have more efficient production and processing technologies which will bolster their capacity to raise productivity, and therefore, income. The associated project has paved the way for major investments in commercial agriculture. WBG Pillar II: Vulnerability and Resilience 31. Outcome 2.1: Better health outcomes. Of the three outcome indicators, one has been achieved, one is on track, another off track: 72 percent of children are fully immunized for Penta3; 81 percent of children now sleep under bed nets to protect against malaria; but the proportion of births assisted by skilled health personnel remains unchanged. The recently completed Health Sector Services Development Project helped RoC to achieve these outcomes. A pilot to test a performance-based financing (PBF) approach that was introduced during the CPS period proved successful and was expanded in the Health Sector Project now underway. The health section of the HD Sector PER informed the design of the new health project and wider sector reforms. 5 The 2012 and 2013 Finance Laws consolidated several tax payments. 8 32. Outcome 2.2: Better education outcomes. The original PRAEBASE project was approved in September 2004, and was extended to June 2009; Additional Financing supplemented the project. The final closing date was moved to June 30, 2013. The outputs of the project include the training of teachers, provision of textbooks, and support for school-level projects. The most noteworthy quality outcomes include an increase in the primary education completion rate from 50 to 79.5 percent, a decrease in primary school repetition rates from 30 to 23 percent, and the carrying out of one round of standardized tests. Project activities aimed at reaching out-of-school youths, and especially indigenous populations, who were able to access both formal and non- formal education. The gender ratio moved from 0.91 to 0.96, gross enrollments increased from 107 to 116 percent, with the percentage of children who had never entered primary level decreasing from 10 to 6 percent. By the end of the project, 80 percent of the indigenous children who enrolled in primary level were still in school. While the project did not attain all of its expected outcomes, it was found to be moderately satisfactory in its attainment of its outcomes. The recently-completed HD Sector PER covering education and health spending is expected to inform government policies and reforms to make investments in these sectors more efficient and effective. Quality remains the most significant challenge by all accounts and access to early childhood education is still very low, with less than 16 percent of the population having access despite the relatively high urban population. WBG Pillar III: Capacity Building and Governance 33. Outcome 3.1: Improved transparency and accountability. Some progress has been made on making public procurement more competitive. So far in 2014 overall 79 percent of contracts (in number) equivalent to 94 percent in amount, have been awarded following competitive bidding. Based on the 2014 DGCMP’s annual report, the outcome indicator target for 80 percent may be achieved by 2016. Completion of the first procurement audit, for the 2011–12 budget, identified poor market practices, poor contract management system, insufficient access to data, and inefficient audit control and anticorruption mechanisms as major problems. The Regulatory Authority for Public Tenders (ARMP) is now finalizing an action plan. Recommendations from the PEMFAR help identify what can be done to improve the transparency and efficiency of public procurement. The program to train national public procurement staff is in place. The milestone on automatic budget execution for better budget management has been completed in June 2015, and the indicator on reducing the deviation between actual and budgeted expenditures in targeted ministries (target of less than 10 percent by 2015 from 40 percent in 2011 with actual at 30 percent at end-2015) is on track. 34. Steps have been initiated to build capacity and improve management in the oil and mining sectors. RoC has published several reports covering the oil, gas and mining sectors which include data on oil sales by the state owned enterprise ("Société Nationale des Pétroles du Congo"/SNPC) and revenue transfers between the latter and the treasury, and are accessible to the public. Production Sharing Agreements and legislation governing the sector are also available on the RoC EITI (Extractive Industries Transparency Initiative) website. RoC became EITI Compliant in February 2013. Although EITI has contributed to consolidate government transparency on fiscal and non-fiscal revenue from extractives, there remain areas for improvement, particularly with regard to the transparency of SNPC (publication of annual audit reports), and the management of excess reserves (there is no formal rule). The Transparency and Fiscal Responsibility Law that the government has been working on over the past two years would help to address these gaps, 9 particularly if complemented by a transparency portal and related monitoring institutions. Progress has however been slow. The Mining Code is being revised to reflect international best practices for mining sector governance, policies, and regulations. Institutional analysis of the Ministry of Mines is underway and training programs are in place to improve contract negotiation skills. However, the objective of putting in place a modern mining cadaster may not be met, partly because the current trust fund is expected to close in 2015. While the Statistics Capacity Building Project has been approved, delays have put the achievement of CPS indicators and milestones for a better statistical system in some doubt. Institutional capacity is being built up in the forestry sector (e.g., revised forest law). Restructuring of the Forestry and Economic Diversification Project is addressing problems of coordination between development partners and an overly- ambitious project design with so many activities that it jeopardized achievement of results. The outcome goal for this area is not being achieved. D. Emerging Lessons 35. Heavy reliance on counterpart funding makes it possible to prepare projects and diversify the Bank’s portfolio. However, it also means there are delays in getting projects underway. While it is a unique feature of the RoC portfolio that the government provides 70 percent of the funding for current operations, it tends to slow progress. Constant dialogue and Bank follow-up on the ground with the government is necessary to ensure timely disbursement of funds and efficient utilization of government resources. 36. Maintaining strategic selectivity and being realistic with regards to government capacity and commitment during CPF preparation is critical for avoiding the danger of overstretching IBRD resources, and experiencing implementation delays. 37. Building capacity and building up institutions take time. Systematic use of the country public financial management system for implementation of the World Bank financed projects is proving challenging due to inadequate administrative capacity and a lack of civil servant motivation to take on complex projects without any equivalent compensation. 38. Inconsistencies between project design and the system for monitoring and evaluation make it hard to get projects underway. Moreover, the unreliability of data and other information is a significant stumbling block for accurate measurement of results. It has thus been necessary to restructure projects to facilitate tracking of impact. For example, a new activity was added in the recent Health Sector Project after restructuring to strengthen the government’s ability to track performance. Viable data sources for both country and sector are needed to adequately monitor progress toward specified outputs and outcomes. IV. ADJUSTMENTS TO THE COUNTRY PARTNERSHIP STRATEGY 39. Because the strategic focus of the CPS is still valid, CPS objectives will continue to focus on the existing pillars: (1) competitiveness and employment, and (2) vulnerability and resilience, both anchored in (3) capacity building and governance. The decline in oil price underscores the urgency of stimulating development of the non-oil economy. A more productive non-oil economy can be the source of quality employment, which is very much needed for 10 inclusiveness. Addressing the challenges of vulnerability and resilience are high on the agenda because there is continued urgency to improve the delivery of basic services and address poverty in rural areas and the burgeoning informal urban areas. The budget tightening driven by the plunge in oil price underscores the need to make public spending more efficient and get a firmer grip on procurement practices. 40. The CPS results framework has been refined to take into account the progress made and the deepening partnership. These include revisions to: (i) take into account the pace and traction of program activities and the necessity of restructuring several projects; (ii) incorporate deepening agendas such as in energy and the emerging emphasis on social assistance and youth employment; and (iii) better align outcomes with indicators and program objectives. In particular, outcomes (and related indicators and milestones) have been added, dropped, or revised in the areas of skills development, social protection, energy utility, agriculture, and education. The results matrix refrained from adding any new outcomes for some planned projects in the pipeline such as education, urban development, and agriculture, as well as the restructured forestry project, as it will take time to show results in those areas; however, future progress made in those areas will build the foundation for the next CPF. 41. The PLR proposes to extend the CPS period by one year to end by FY17. This extension helps accomplish several objectives. (i) It makes it possible to align the CPS with the political agenda and the government’s own programmatic cycle. (ii) The additional year adds a buffer for the delivery of the results as revised. (iii) It provides additional time to complete the analytical work needed to inform the Systematic Country Diagnostic (SCD). A solid SCD is needed to refine the agenda so it contributes to achievement of the twin goals. Most of the target values in the updated results framework have also been extended (unless the supporting WBG instrument closes earlier) to take into account the CPS extension. 42. The WBG is looking for closer engagement with RoC. IBRD eligibility opens space for buttressing the current agenda, helping to transform the economy to diversify from oil, and posting significant gains on inclusion. The IFC is similarly looking at stepping up its involvement with RoC in (i) agribusiness and manufacturing; (ii) mining; (iii) access to finance for micro, small, and medium enterprises (MSMEs); and (iv) infrastructure, notably in the power and transport sectors through PPPs. 43. The revised CPS program and outcomes tighten its alignment with the twin WBG goals of ending extreme poverty and boosting shared prosperity while also enhancing the capacity of RoC to deliver solid outcomes. The CPS program is already aligned with the WBG goal of boosting shared prosperity; operations in the pipeline or those recently approved will bring this alignment closer. The CPS will make an effort to mainstream citizen engagement for all future operations, policy dialogue and analytical work. One of the entry points in this regard will be the preparation of the SCD and new operations in the pipeline. The emphasis on inclusive growth, the continued strong gender dimensions of the WBG program, and the ongoing alignment of the forestry and other projects to climate change mitigation and disaster risk management objectives, all mirror key IDA 17 themes. 11 Adjustments to Pillar I: Competitiveness and Employment 44. CPS work under this pillar will continue to concentrate on improving the efficiency of infrastructure, the business environment, SME development, regional integration, market access and agricultural production, and strengthening the skills training program. The Bank will scale up its work to make the energy sector more financially viable through Additional Financing for the Water, Electricity and Urban Development Project, giving priority to upgrade electricity distribution and transmission; enhancing the operational performance of key business areas; and institutional reinforcement of the electricity utility. In addition, government has mandated IFC to structure a PPP for a green-field hydroelectric dam at Sounda Gorge. As a result, some of the indicators and milestones under the original Outcome 1.1 (now revised as Outcome 1) which duplicated and overlapped with some indicators under Pillar III, are now either dropped (to remove redundancies) or combined with the latter to form Outcome 9 (see Annex 2 for details). The indicators for the Energy and Water Utilities are revised and new ones added to align better with the results of the ongoing program and to capture the IFC engagement on PPP for Sounda Dam. 45. At the request of the government, the Bank will sharpen its focus on upgrading informal settlements. A new project in urban development in Brazzaville and Pointe Noire aims to ensure better access to basic infrastructure services. The government plans to provide financing of US$40 million; the Bank will finance US$80 million. The program to address urban poverty will have two phases: (i) a short-term approach dedicated to providing basic infrastructure and access to services, and (ii) a medium-term approach to design and launch a multi-sectoral strategy and an action plan for absorption of vulnerable settlements. The program will also address disaster risk management by constructing or rehabilitating drainage systems. No new indicators are added as results are not expected during the current CPS. 46. The WBG is deepening its engagement to further diversify the non-oil sectors and help make the economy more competitive. The restructured Support to Economic Diversification Project will promote private investment in six non-oil value chains and support development of SMEs. The government has also requested a RAS to provide technical assistance for activities such as (i) support for an effective delivery system for public investment projects; (ii) an effective PPP arrangement; and (iii) comprehensive SME financing and development. A key adjustment in the results framework is splitting the erstwhile Outcome 1.2 (Improved Business Climate) into separate Outcomes 2 and 3 on business regulatory environment and SME development, respectively, to sharpen focus. Two results areas (Attracted Investment in Other Potential Sectors, and Broadened the Types of Support to Private Enterprises) and the related indicators and milestones are dropped as these were too broadly defined, not measurable and not directly attributable to WBG engagements. Indicators have been added for the separate outcome on SME development along with milestones including ones that capture IFC activities. 47. WBG support to agriculture development will target high potential areas. Additional Financing of the current Agriculture Development and Rural Roads Rehabilitation Project will continue to be directed to these target areas, increasing synergies between components, and supporting micro projects in selected value chains for more development impact. Planned analytical work on the agriculture sector will identify and address constraints and issues related to rural poverty. The Bank will also support realization of a national strategy for rural road 12 maintenance. The re-worded Outcome 5 (original Outcome 1.4) is more specific and the revised and added indicators are better aligned with project outputs (rehabilitated rural roads and market infrastructure; yields of specific key agricultural products). 48. A new CPS outcome focuses on improving the skills of the poor and emphasizes youth employment. The Bank will help to reach this outcome through the Skills Development for Employability Project which provides US$10 million (IDA). The program will train 15,000 vulnerable youth so that they have skills that enhance their opportunities for quality employment and entrepreneurship. It will be complemented by building up the technical and operational capacity of the ministry in charge of vocational training. However, the focus on skills for youth employment is only one element of the broader jobs agenda. A proposed economic study will analyze RoC’s jobs challenges and formulate specific recommendations for the rest of the CPS period. New Outcome 6 (Improved Skills for Youth Employment) also adds several new indicators and milestones (e.g., piloting of new skills training approach for young men and women; number of youths benefitting; market assessment study; skills strategy development; see Annex 2). Adjustments to Pillar II: Vulnerability and Resilience 49. The WBG will continue to emphasize better delivery of health and education services and will support establishment of an innovative safety net program. To further strengthen health service delivery, the second phase of the Health Sector Project will support increased utilization and heightened quality of maternal and child health services in targeted areas. It will build on the success of the PBF pilot to improve outputs and outcomes. The Bank has provided US$10 million (IDA) from the Health Results Innovation Fund (HRIF) and the government is providing US$100 million. It is anticipated that 80 percent of the population will then have better access to health services and thus better health indicators. Continuous evaluations will assess the impact of PBF interventions on maternal and child health outcomes. Additional results indicators will monitor progress on increased antenatal care (percentage of pregnant women having at least three antenatal care visits before delivery) and improved child nutrition (number of children between six and 59 months receiving nutritional services). 50. To further improve delivery of education services, an education operation is now being designed. The project will consolidate the recent gains in access to primary education in order to improve its quality, make education more relevant to the labor market and sharpen the focus on science, technology, engineering, and mathematics (STEM). The project expects to track gender dimensions not only for enrollments and completion but also orientation into specific disciplines and successful transition to the following levels. Building on the findings of the HD Sector PER, a RAS is proposed to support the government as it reforms higher education. The education outcome is excluded from the updated results framework as the results will not show any progress by 2017. 51. The Bank is supporting the establishment of a foundation for a solid and effective safety net program. The innovative LISUNGI Safety Nets Project will help design and pilot a cash transfer program to encourage access to health and education for children from the poorest households. The pilot will support the first phase of the government’s long-term plan6 by providing 6 The government plan is for a national safety net to cover all the poorest individuals and households in the country. 13 a small cash transfer for 5,000 households and 1,000 elderly people while establishing the building blocks for the national safety net. It is expected that in the pilot areas (which comprise about 308,000 households), reaching 5,000 households should reduce poverty rates by 2.5 to 5 percent. New Outcome 8: Increased Social Protection Coverage has been added with an indicator on number of beneficiary households enrolled, and milestones on establishing the key building blocks of the program and the unique registry, and distribution of Personal Identification Cards. Adjustments to Pillar III: Capacity Building and Governance 52. Continued WBG engagements will support the work to improve the efficiency of public sector management and the budget process. The CPS will continue its programs to strengthen budget execution and procurement and improve the efficiency of public investment management. PEMFAR diagnostics and recommendations will help identify steps to improve the transparency, efficiency, and credibility of PFM, procurement, and budgeting. Since the Transparency and Governance Repeat Project closed recently, technical assistance (TA) will be offered to complement and continue reform. The TA will provide support to ensure that all investment projects are closely monitored to minimize resource leakage and facilitate private sector participation. The TA will also help to build the capacity of traditional overseers and civil society organizations to monitor and evaluate the evolution of public reforms. The current Statistics Capacity-Building Project is expected to modernize government capacity to generate quality data so that interventions can be better targeted. A key evolution in the results monitoring for these aspects is the consolidation of common and overlapping elements from the original CPS. Outcomes 1.1 and 3.1 have been consolidated into a new comprehensive Outcome 9: Improved Budget Management, Procurement, and Statistical System. As the WBG program currently is not supporting any activities in the area of improvement in petroleum revenue transparency, the related indicators and milestones are dropped. A separate Outcome 10 (Improved Institutional Framework for the Management of the Mining Sector) is created to focus on this economically important sector in RoC. A new indicator will be used to monitor the adoption of a revised mining code. The previous indicator on putting in place a modern mining cadaster is revised and added as a milestone on the development of the roadmap towards that objective. 53. WBG support for climate change mitigation will continue. Even as the Forestry and Economic Diversification Project is being restructured, efforts are being made to align IDA’s forestry program with the government’s Emission Reductions Program (ERP) in Northern Congo which aims at reducing emissions from deforestation and forest degradation (11.7 MtCO2 until 2020). This program is designed in close cooperation with the Olam group through a private-public partnership. Already selected by the Carbon Fund of the Forest Carbon Partnership Facility, this initiative could lead to the signing of an Emission Reductions Payment Agreement (ERPA) amounting to US$60 million. Significant efforts are made to align all other existing (IDA) or potential (GEF & Forest Investment Program) forest-related projects with this initiative. As the impact of the restructured forestry project is unlikely to materialize during the remaining CPS period, results related to timber export management are dropped. Indicative Program 54. The lending program in FY16–FY17 will depend on government demand, portfolio performance, and IBRD lending capacity. The total indicative envelope for the RoC under IDA 14 17 is currently estimated to be US$54.4 million, while it currently stands at about US$130 million in investment lending for IBRD in FY16. The recent IBRD access to resources under blend status has allowed the Bank to supplement IDA resources and prepare two major projects: (i) Additional Financing for the Water, Electricity and Urban Development project and (ii) the Urban Development and Poor Neighborhood Upgrading Program. In addition, a new Global Partnership for Education financed project is being prepared. There is an interest from the government to access financing for a budget support project. 55. The CPS will explore RAS possibilities. The RoC’s sovereign wealth fund was legally established in 2014 and the Bank has been approached to assist the authorities in its implementation through a RAS agreement which was signed in April 2015. 56. The CPS will also explore opportunities for PPPs, particularly with possible PPP leads for IFC in the roads7 and power8 sectors. These activities will be achieved through IFC PPP Transaction Advisory Services or through a Bank RAS intervention. 57. Analytical and advisory services for the final two years of the CPS are aligned with the twin WBG goals and support the government’s development priorities. The analytical work has been designed to address pockets of poverty, vulnerability, and growth opportunities. This will feed eventually into the SCD. The WBG’s analytical work will also underpin the current and proposed lending program. Key ongoing and planned analytical work, such as the poverty assessment, job diagnostic, public investment, and SCD, will lay the foundation for the WBG’s engagements in RoC. It is expected that preparation of the SCD will begin in FY16. Table 2: CPS Program FY15-FY17 Indicative Financing Indicative ASA/TA/RAS Ongoing/Planned IFC (IBRD/IDA) Engagements  AF Water, Electricity and  Agriculture and Rural  IFC PPP Transaction on Urban Development Poverty Sounda Dam Project (US$45m IBRD/  PEMFAR Follow Up  OHADA Business Law US$15m IDA)  Systematic Country Reform Program  Urban Development and Diagnostic  IFC Advisory: IFC Risk Poor Neighborhood  Tertiary Education Sharing Facility combined Upgrading Project  Sovereign Wealth Fund with Business Edge SME (US$80m IBRD) (RAS; signed) Training Toolkit  Education Sector Support  Health in Africa Initiative Project (US$30m IDA/US$10m GPE)  Agriculture Project (tbd)  Support for Sustainable Livelihoods (tbd) 7 Concessioning of the publicly funded national road no. 1 (Brazzaville-Pointe Noire), national road no. 2 (Brazzaville- Ouesso). 8 Kouembali dam of 180 MW & Chollet 600 MW; the gas fired Independent Power Producer (IPP) in Pointe Noire. 15 Ongoing Projects Ongoing ASA/TA/RAS/TF  Water, Electricity and Urban  TA Gas Market Development Development Project  TA Sovereign Wealth Fund (RAS)  Support to Economic Diversification  EW Policy Note on Economic Project Diversification  Central African Backbone Project -  PA Helping Increase Value-for-Money of APL3 Investments  Agriculture Development and Rural  TA Financial Sector Development Strategy Roads Rehabilitation Project  Impact Evaluation of Performance Based  Skills Development for Employability Financing Project  EW Poverty Assessment  Health Sector Project  EW Economic Update (various editions)  LISUNGI Safety Nets Project  TA Mining Dialogue  Statistics Capacity Building Project  EW Balancing Mining and Forest  Forestry and Economic Diversification Conservation in the Congo Basin Project  Mining Sector TF  Extractive Industries TF V. RISKS TO THE CPS PROGRAM 58. Some of the risks identified during preparation of the CPS remain valid. Based on the SORT analysis, the overall rating of the risks for CPS implementation is substantial. Table 3: Revised Systematic Operations Risk Rating Tool Risk Categories Ratings (H, S, M or L) 1. Political and governance H 2. Macroeconomic S 3. Sector strategies and policies M 4. Technical design of project and program M 5.Institutional capacity for implementation and sustainability H 6. Fiduciary H 7. Environment and social L 8. Stakeholders L 9. Other L Overall rating S 59. Political and governance: The intense political agenda, with presidential elections planned for 2016, could be a risk with regard to government commitment to reforms and engagement in certain sectors and activities, such as procurement reforms, strengthened governance, and 16 analytical work. These risks are being mitigated by fostering ownership of the analysis and recommendations and by close coordination with the government on dissemination activities. 60. Macroeconomic: Adverse trends in the international prices of commodities, slower growth in advanced and emerging economies, and the slowdown of growth in China could further reduce RoC’s oil revenues. This could cause the government to decrease spending and negatively impact growth prospects as well as the government’s capacity to provide counterpart funding to Bank projects. This risk is mitigated by increased portfolio selectivity, closer collaboration with IFC and MIGA, and using PPPs to fund large infrastructure projects. 61. Institutional capacity for implementation and sustainability: If the government cannot meet its funding commitments, programs may be delayed. Other challenges to CPS effectiveness may arise from inadequate implementation capacity and systematic use of country systems. The Bank team will work with the government counterpart closely through bimonthly meetings and annual portfolio reviews. This will provide opportunities to anticipate delays for a given project and identify a solution. 62. Fiduciary: Streamlining Bank projects through the administration poses a high risk. The Bank conducted a Use of Country System study two years ago and the main conclusions of the study are that: (i) the projects’ Annual Working Programs are not incorporated into the national budget, (ii) the bulk of resources coming from all donors is placed in commercial banks rather than in the Central Bank, and (iii) the external audits are performed by international auditing firms as the Supreme Audit Institution is not yet well equipped to conduct such audits. As mitigation measures, a capacity building program is being implemented, a manual of procedures is being developed, and the national control institutions such as ‘Cour des Comptes’ are progressively involved in the implementation of the Bank- financed projects. 17 VI. ANNEXES Annex 1: Updated CPS Results Matrix9 Country Development Issues andCPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) I. WBG Pillar: Competitiveness and Employment Outcome 1: Improved Operational and Financial Performances of Key Utility Sectors Administrative Poor performance (i) Energy Utility.  Action Plan for the Ongoing Financing: governance of key economic Indicator 1: Revenue reform of the power  Water, Electricity and utilities (Energy, collection rate increases per utility (Société Urban Development Water, Railway). year from 70% (2010) to 90% Nationale Project (2017) d’Electricité) is Indicator 2: Improvement of completed and Indicative Financing: transit capacity of network approved by the  Water, Electricity and distribution from 430 MVA Government Urban Development (2014) to 500 MVA (2017) Project (AF) Indicator 3: Public Private  Urban Development Partnership transaction and Poor concluded for Sounda dam, Neighborhood with potential generating Upgrading Project capacity in excess of 500 MW (by FY16) IFC: 9 Given the proposed extension of the CPS to FY17, the target values for the indicators have been updated. In some cases, the target values are for years earlier than end-CPS as the supporting WBG instruments have an earlier closing date. 18 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) (ii) Water Utility.  New water legal and  IFC PPP Transaction Indicator 4: Connections with regulatory framework on Sounda Dam operating water meter in fully defined and Brazzaville up from 0.54% enforced Ongoing ASA/TA: (2014) to 7% (2017); and in  Water service  TA Gas Market Pointe Noire from 0.2% (2014) contract in place. Development to 2% (2017) (Achieved) Indicator 5: Collection ratio (cash income per billed revenue) increases from 47% (2010) to 65% (2017) (iii) Increase in Railway  CFCO 5-year Traffic. business plan Indicator 6: CFCO traffic approved by increases from 0.8 million tons Management. (2010) to 1.0 million tons (Achieved) (2016). (Achieved) Outcome 2: Improved Business Regulatory Environment Promote foreign Weak business (i) Faster Business  The one-stop window Ongoing Financing: and domestic climate Registration. is effective with an  Support to Economic investment to characterized by: Indicator 7: Number of information Diversification Project increase sector  Bureaucratic procedures to start a business technology system  Forestry and assets and trade delays in reduced from 10 (2010) to 7 designed and Economic diversification business (2017) implemented to Diversification Project registration interconnect the five  Long export (ii) Reduced Time to Export (5) nationwide CFE IFC: delays Goods. agencies among  OHADA Business  Long import themselves and with Law Reform Program delays all contributing 19 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17)  Complex and Indicator 8: The time to export government agencies Ongoing ASA/TA: unevenly goods reduced from 50 (2010) to streamline the  TA Sovereign Wealth applied tax to 30 (2017) days business registration Fund (RAS) system process.  EW Policy Note on (iii) Reduced Time to Import  The import and Economic Goods. export one stop shop Diversification Indicator 9: The time to import is operational.  PA Helping Increase goods reduced from 62 (2010) (Achieved) Value-for-Money of days to 40 (2017) days Investments  Financial Sector (iv) Streamlined Tax System.  Streamlined tax Development Strategy Indicator 10: The number of framework adopted. tax payments reduced from 61 (2010) to below the Sub- Saharan average of 30 (2017) Outcome 3: Supported SME Development in the Targeted Value Chain Promote foreign Deficit of non- Indicator 11: Number of SMEs  The development of Ongoing Financing: and domestic financial services benefitting from the capacity domestic non-  Support to Economic investment to to support SME building program increased financial services Diversification Project increase sector development and from 180 (2014) to 500 (2017) supported with assets and trade growth Indicator 12: Number of SMEs training programs for IFC: diversification that have access to financial 120-150 services  IFC Advisory: IFC services increased from none to providers with the Risk Sharing Facility 350 (2017) development of a combined with national database. Business Edge SME  Support local content Training Toolkit and SME value chain program initiated by Ongoing ASA/TA: RoC’s largest  TA Sovereign Wealth corporation (up to Fund (RAS) 20 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) 600 SMEs identified  EW Policy Note on by TOTAL Congo in Economic their Local Content Diversification Database).  TA Financial Sector  A “train-the-trainer” Development Strategy program is set up to help build the capabilities and help professionalize 120- 150 of these non- financial services providers.  IFC Risk Sharing Agreements for a cumulative amount of FCFA 20 billion in new SME financing facilities with two domestic commercial banks in 2015.  IFC support to local content and SME Value Chain program initiated by RoC’s largest corporation (initial pilot of up to 30 SMEs in TOTAL Congo Value Chain) as part of the largest upstream oil field 21 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) development, Moho North.  IFC deployment of Business Edge (BE) platform in RoC through local certified BE providers. Outcome 4: Improved Regional Telecommunications Infrastructure Weak regional (i) Higher Volume of  Regional and Ongoing Financing: development, integration International Telecomm international optical  Central African growth and Traffic (international internet fiber connections Backbone Project - diversification bandwidth). installed. APL3 Indicator 13: Bits per second increase from 75 (2012) to 200 (2016) (Achieved) Outcome 5: Improved Market Access and Increased Agricultural Production in the Targeted Areas Growth and Weak (i) Market Access:  1,000 km of priority Ongoing Financing: diversification performance in Indicator 14: Length of rural roads rehabilitated.  Agriculture key primary roads rehabilitated increases (Achieved) Development and sectors: from 0 km (2008) to 1,321 km Rural Roads (2016) Rehabilitation Project Poor market Indicator 15: Number of  Market access linkages in zones producers with access to improved in areas Indicative Financing: with high rehabilitated market with built market  Agriculture Project agricultural infrastructure increases from infrastructure (18 (tbd) potential 84,396 (2013) to 88,343 (2016) markets with the  Support for ongoing project). Sustainable Limited access to (ii) Food Production of Key (Achieved) Livelihoods (tbd) agricultural Agricultural Products. 22 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) technologies Indicator 16: Increased yields:  30% of farmers in Ongoing ASA/TA: (mainly improved Cassava: 8.4 (tons/ha) (2013); targeted zones adopt  EW Poverty seeds and target: 10.6 (2016) improved Assessment seedlings) to Banana: 0.6 (tons/ha) (2013); technologies (seeds). develop the high target: 0.8 (2016) (Achieved) Planned ASA/TA: agricultural zones Maize: 0.25 (tons/ha) (2013);  ESW on Agriculture to improve food target: 0.5 (2016) and Rural Poverty security and revenues for rural populations Outcome 6: Improved Skills for Youth Employment Indicator 17: New  Market assessment Ongoing Financing: comprehensive skills training study completed.  Skills Development approach (not available in  Database for TVET for Employability 2014) developed and piloted provision established. Project with the aim of increasing  Skills Development employability of urban Strategy document Indicative Financing: vulnerable youth, targeting prepared.  Support for equal numbers of young men Sustainable and women (2017) Livelihoods (tbd) Indicator 18: Number of youth  Education Sector who benefitted from pilot skills Support Project and job training program increased from none (2014) to Planned ASA/TA: 7,500 (2017)  Tertiary Education II. WBG Pillar: Vulnerability and Resilience Outcome 7: Increased Health System Performance Social High child and (i) Better Protection Against  Insecticide and Ongoing Financing: development and maternal Malaria. treated nets  Health Sector Project inclusion mortality due to: distribution to 23 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17)  Malaria Indicator 19: Percentage of households. IFC:  Low children under five years of age (Achieved)  Health in Africa immunization sleeping under an insecticide- Initiative  Unsafe treated net the previous night motherhood increases from 67% (2011) to Ongoing ASA/TA: 80% (2015) (Achieved)  Impact Evaluation of  Capacity building for Performance Based (ii) Higher Immunization immunization carried Financing Rates. out, and the vaccine Indicator 20: Percentage of distribution system children fully immunized for operational and Penta3 (DTP, Hep. B, and approved. Hemovirus) increases from 65% (2013) to 75% (2016)  Equipment of Health (iii) Higher Professionally Centers and Aided Delivery. retraining of staff are Indicator 21: Percentage of completed. births attended by skilled health personnel increases from 93.6% in 2011 to 97% by 2015 (iv) Increased Antenatal Care. Indicator 22: Percentage of pregnant women having at least 3 antenatal care visits before delivery increases from 45% in 2015 to 55% in 2017 (v) Improved Child Nutrition. 24 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) Indicator 23: Number of children between 6 and 59 months receiving nutritional services increases by 20% between 2015 and 2017 Outcome 8: Increased Social Protection Coverage Indicator 24: Number of  Establishment of the Ongoing Financing: potential beneficiary key building blocks  LISUNGI Safety Nets households enrolled in the of the program, the Project unique registry for safety net unique registry for program increases from 0 potential Indicative Financing: (2014) to 5,000 (2017) beneficiaries of social  Support for policies. Sustainable  Distribution of Livelihoods (tbd) Personal  Urban Development Identification cards and Poor will be issued for Neighborhood beneficiaries to verify Upgrading Project their identities. Ongoing ASA/TA:  EW Poverty Assessment Planned ASA/TA:  ESW on Agriculture and Rural Poverty III. WBG Foundation Pillar: Capacity Building and Governance Outcome 9: Improved Budget Management, Procurement, and Statistical System Economic Improving but (i) More Competitive  Annual training Ongoing Financing: governance still weak Procurement. programs of 25 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) procurement Indicator 25: At least 80% procurement staff in  Statistics Capacity Administrative management (2017) of public contracts in the ministries are Building Project governance, excess of FCFA 250 million are completed on time. infrastructure subjected to competitive  Production of annual Ongoing ASA/TA: development Weak budget bidding from the current 60% procurement audit  EW Economic Update control resulting (2015). reports six (6) months (various editions) in overruns after the end of the (ii) Better Budget budget year. Planned ASA/TA: Low efficiency in Management.  Automatic budget  PEMFAR Follow Up the management Indicator 26: Deviation execution system with  Systematic Country of Government’s between actual and budgeted habilitation to reject Diagnostic public investment expenditure by targeted all overruns in place program ministries reduced from 40% and functioning. Staff (2011) to less than 10% (2015) trained in the use of this system. (iii) Better Project Selection.  Fonds d’études is Indicator 27: At least 50% of fully operational and Poor statistical government projects, each in the capacity of capacity excess of FCFA 250 million, government staff have a feasibility study prior to responsible for project incorporation into the budget appraisal is reinforced.  Training program for (iv) Improved Statistical staff involved in System. public procurement Indicator 28: World Bank process is in place and Statistical Capacity Indicator implemented. Score (SCI) increased from 50 (2012) to 55 (2017) 26 Country Development Issues and CPS Outcomes and Indicators Milestones WBG Program Goals Obstacles (FY13-FY17) (v) Greater Government Annual Training program Transparency. developed and Indicator 29: Annual report of implemented. (Achieved) the Supreme Audit Authority and the State General Inspectorate are publicly available. (Achieved) Outcome 10: Improved Institutional Framework for the Management of the Mining Sector Economic Limited capacity (i) Better Mining Sector  Analytical work on Ongoing TF: governance in managing the Management. mining code and  Mining Sector TF nascent mining Indicator 30: A revised mining advice on geo-data  Extractive Industries Administrative sector code in line with international management TF governance, good practices is adopted provided. infrastructure (2017)  Legal and institutional Ongoing ASA/TA: development frameworks  TA Mining Dialogue strengthened.  EW Balancing Mining  Guidelines to optimize and Forest mining benefits and Conservation in the social safeguards Congo Basin adopted.  A roadmap for putting in place a modern mining cadaster has been developed and capacity of relevant government authorities built. 27 Annex 2: Republic of Congo: Changes to CPS Results Matrix10 Original CPS Results Matrix Updated CPS Results Matrix Comments I. WBG Pillar: Competitiveness and Employment Outcome 1.1: Improved Investment Outcome 1: Improved Operational and Programming and Infrastructure Financial Performances of Key Utility Management Sectors (i) Better Project Selection Moved to Outcome 9 as (iii) Better Moved to eliminate duplication between Project Selection along with related Outcome 1 and Outcome 9. Indicator and Milestones. (ii) Better Budget Planning Both the results area and the related Eliminates duplication as above. Better Indicator: The global/ government-wide Indicator as well as the Milestones are Budget Management with a sharper MTEF is fully operational dropped. indicator is already included in Outcome 9. Milestone: Strategies for key sectors are As above. Dropped. updated. Milestone: Macroeconomic data for all As above. Dropped. sectors are updated in order to prepare a suitable medium term expenditure framework starting with 2013 budget. (iii) Improved Operational and Financial (i) Energy Utility. Revised and added Indicators to align with Performance of Energy Utility. Revised (Indicator 1): Revenue the outcomes under the Additional Indicator: Revenue collected per kilowatt collection rate increases per year from Financing of the ongoing program. New hour delivered to the Brazzaville 70% (2010) to 90% (2017) Indicator added to capture the IFC distribution network increases by 10% New Indicator 2: Improvement of transit engagement. from 2012 level. capacity of network distribution from 430 MVA (2014) to 500 MVA (2017) New Indicator 3: Public Private Partnership transaction concluded for 10 Unless noted in this table, other elements of the original CPS Results Matrix (Annex 3) remain unchanged in the Updated PLR version (Annex 1). Reference numbers for Outcomes, Indicators, and Milestones in column 1 relate to the original CPS Results Matrix (Annex 3) and in column 2 they relate to the Updated CPS Results Matrix (Annex 1). Given the proposed extension of the CPS to FY17, the target values for the indicators have been updated. These are not individually noted in this table. In some cases, the target values are for years earlier than end-CPS as the supporting WBG instruments have an earlier closing date. 28 Original CPS Results Matrix Updated CPS Results Matrix Comments Sounda dam, with potential generating capacity in excess of 500 MW (by FY16) (iv) Improved Operational and Financial (ii) Water Utility. Baseline and target figures have been Performance of Water Utility. Revised baselines/targets (Indicator 4): revised within the framework of the AF of Indicator 1: Connections with operating Connections with operating water meter the current operation. With the presence of water meter in Brazzaville up from 4% to in Brazzaville up from 0.54% (2014) to the Private Operator, a reliable diagnostic 30%; and in Pointe Noire from 37% to 7% (2017); and in Pointe Noire from of the water utility has been carried out 53%. 0.2% (2014) to 2% (2017) which led to better knowledge of the situation on the ground of connections with operating water meters in two cities. Indicator 2: Collection ratio (cash income Revised target (Indicator 5): Collection While the 2016 target was 70%, the 2017 per billed revenue) increases from 47% ratio (cash income per billed revenue) target is set at 65% to be realistic and (2010) to 70% (2016). (On track) increases from 47% (2010) to 65% pragmatic. (2017) Outcome 1.2: Improved Business Outcome 2: Improved Business Improved and more specific wording. Climate Regulatory Environment (i) Faster Business Registration. Indicator: Number of procedures to start a Revised target (Indicator 7): Number of While the target for 2016 was 5, the target business reduced from 10 (2010) to 5 procedures to start a business reduced for 2017 is set at 7 to be realistic and (2016). from 10 (2010) to 7 (2017) pragmatic. (ii) Reduced Time to Export Goods. Indicator: The time to export goods Revised target (Indicator 8): The time While the target for 2016 was 20 days, the reduced from 50 (2010) to 20 days (2016). to export goods reduced from 50 (2010) target for 2017 is set at 30 days to be to 30 (2017) days realistic and pragmatic. (iii) Reduced Time to Import Goods. Indicator: The time to import goods Revised target (Indicator 9): The time While the target for 2016 was 30 days, the reduced from 62 days (2010) to 30 days to import goods reduced from 62 (2010) target for 2017 is set at 40 days to be (2016). (On track) days to 40 (2017) days realistic and pragmatic. 29 Original CPS Results Matrix Updated CPS Results Matrix Comments (v) Supported SMEs. Moved to Outcome 3. Replaced by new New Outcome 3 is created to separate Indicator: Support the development of Indicator 11 and new Indicator 12. business regulation strengthening from national database of nonfinancial services SME development. providers accessible by SMEs nationwide Broadly defined Indicator is replaced by through the CFE and ultimately the MEC. more specific measurable indicator (see below under Outcome 3) Milestone: A “train-the-trainer” program Moved to Outcome 3. Aligned with Outcome 3 which is focused is set up to help build the capabilities and on SME development. help professionalize 120-150 of these non- financial services providers. (vi) Attracted Investment in Other Dropped. Indicator was too broadly defined and not Potential Sectors. directly attributable to WBG engagements. Indicator: Increased investments in Also, it is not measurable with available agribusiness, transit related services, wood data. transformation and mining Milestone: 2–4 investment promotion Dropped. Milestone was linked to the above activities a year organized for the next 3 indicator which is now dropped. years to educate and attract potential investors in key priority value chains. 12- 15 anchor investors (from project inception to realization) in the agribusiness value chains including palm oil, horticulture, corn and cassava supported. (vii) Broadened the Types of Support to Dropped. Indicator was too broadly defined and not Private Enterprises. directly attributable to WBG engagements. Indicator: Improved SME access to non- Also, it is not measurable with available financial services. data. Milestone: 250-300 SMEs supported with First part dropped. Key portion of the Milestone has been capacity building programs to improve “The development of domestic non- retained under Outcome 3. managerial capabilities and productivity in financial services supported with training the agribusiness, transit, and wood programs for 120-150 services providers 30 Original CPS Results Matrix Updated CPS Results Matrix Comments transformation sectors. The development with the development of a national of domestic non-financial services database” moved to Outcome 3 as supported with training programs for 120- Milestone. 150 services providers with the development of a national database Outcome 3: Supported SME Outcome 3 is created to separate business Development in the Targeted Value regulation strengthening from SME Chain development. New Indicator 11: Number of SMEs Indicators specified to measure Outcome 3. benefitting from the capacity building program increased from 180 (2014) to 500 (2017) New Indicator 12: Number of SMEs that have access to financial services increased from none to 350 (2017) New Milestone: The development of This Milestone is adapted from previous domestic non-financial services Milestone under 1.2 (vi) as noted above. supported with training programs for 120-150 services providers with the development of a national database. New Milestone: A “train-the-trainer” This Milestone is moved from under program is set up to help build the previous 1.2 (v) as noted above. capabilities and help professionalize 120- 150 of these non-financial services providers. New Milestone: Support local content New Milestones are added to capture and SME value chain program initiated activities related to SME value chains and by RoC’s largest corporation (up to 600 planned IFC engagements and services. SMEs identified by TOTAL Congo in their Local Content Database). New Milestone: IFC Risk Sharing Agreements for a cumulative amount of 31 Original CPS Results Matrix Updated CPS Results Matrix Comments FCFA 20 billion in new SME financing facilities with two domestic commercial banks in 2015. New Milestone: IFC support to local content and SME Value Chain program initiated by RoC’s largest corporation (initial pilot of up to 30 SMEs in TOTAL Congo Value Chain) as part of the largest upstream oil field development, Moho North. New Milestone: IFC deployment of Business Edge (BE) platform in RoC through local certified BE providers. Outcome 1.3: Improved Regional Outcome 4: Improved Regional No changes. Telecommunications Telecommunications Outcome 1.4: Improved Agricultural Outcome 5: Improved Market Access Wording made more specific. Production and Increased Agricultural Production in the Targeted Areas (i) Improved Market Access. (i) Market Access: Indicator: Transportation time in areas Revised (Indicator 14): Length of rural Revised Indicator better aligned with WBG with rehabilitated rural roads reduced by at roads rehabilitated increases from 0 km project outcomes related to rehabilitation least 30%. (2008) to 1,321 km (2016) of rural roads and is directly measurable. New Indicator 15: Number of producers New indicator added to capture project with access to rehabilitated market components supporting market infrastructure increases from 84,396 infrastructure rehabilitation. (2013) to 88,343 (2016) (ii) Increase Food Production. (ii) Food Production of Key Agricultural Greater specificity in defining Indicators: Indicator: Increase food production in Products. rather than a vague “increase food targeted zones by 20%. Revised (Indicator 16): Increased yields: production”, the revised indicator names Cassava: 8.4 (tons/ha) (2013); target: specific crops and their yields per hectare. 10.6 (2016) 32 Original CPS Results Matrix Updated CPS Results Matrix Comments Banana: 0.6 (tons/ha) (2013); target: 0.8 (2016) Maize: 0.25 (tons/ha) (2013); target: 0.5 (2016) Outcome 6: Improved Skills for Youth New Outcome 6 added to capture ongoing Employment WBG project outcomes (Skills Development for Employability Project). New Indicator 17: New comprehensive Added new Indicators for new Outcome 6. skills training approach developed and piloted with the aim of increasing employability of urban vulnerable youth, targeting equal numbers of young men and women (2017) New Indicator 18: Number of youth who benefitted from pilot skills and job training program increased from none (2014) to 7,500 (2017) New Milestone: Market assessment Added new Milestones for new Outcome 6. study completed. New Milestone: Database for TVET provision established. New Milestone: Skills Development Strategy document prepared. II. WBG Pillar: Vulnerability and Resilience Outcome 2.1: Better Health Outcomes Outcome 7: Increased Health System Revised to tighten the wording. Performance New Results Areas: Added to capture outcomes of WBG activities to reflect the additional emphasis (iv) Increased Antenatal Care. of the second phase of the Health Sector New Indicator 22: Percentage of Project on maternal and child health pregnant women having at least 3 services. antenatal care visits before delivery 33 Original CPS Results Matrix Updated CPS Results Matrix Comments increases from 45% in 2015 to 55% in 2017 (v) Improved Child Nutrition. New Indicator 23: Number of children between 6 and 59 months receiving nutritional services increases by 20% between 2015 and 2017 Outcome 2.2: Better Education Dropped including all related No current WBG education operation after Outcomes indicators and milestone. the previous project closed. A new education operation is under preparation but will not show any results during the remaining CPS period. Thus the outcome is dropped. Outcome 8: Increased Social New Outcome 8 added to capture Protection Coverage outcomes of ongoing WBG project (LISUNGI Safety Nets Project). New Indicator 24: Number of potential Added new Indicator for new Outcome 8. beneficiary households enrolled in the unique registry for safety net program increases from 0 (2014) to 5,000 (2017) New Milestone: Establishment of the Added new Milestones for new Outcome 8. key building blocks of the program, the unique registry for potential beneficiaries of social policies. New Milestone: Distribution of Personal Identification cards will be issued for beneficiaries to verify their identities 34 Original CPS Results Matrix Updated CPS Results Matrix Comments III. WBG Foundation Pillar: Capacity Building and Governance Outcome 3.1: Improved Transparency Outcome 9: Improved Budget Outcome 9 incorporates elements of the and Accountability Management, Procurement, and erstwhile Outcome 1.1 and Outcome 3.1 to Statistical System eliminate redundancies and overlaps. Also, revised for greater specificity and better alignment with WBG support. (iii) Greater Government Transparency. (v) Greater Government Transparency Serial number changed from (iii) to (v) (iv) Improvement in Petroleum Revenue Dropped including the indicator. The WBG program currently is not Transparency and Governance of Sector supporting any activities in the area of Institutions. improvement in petroleum revenue Indicator: Attain EITI compliance and transparency. The related indicators and remain compliant. milestones are dropped. Milestone: Attain EITI Validation. Dropped. As above. Milestone: Timely publication of SNPC Dropped. audit reports. Dropped. Milestone: Timely publication of quarterly oil revenue reports. (v) Better Mining Sector Management. Moved to Outcome 10 and revised (see Separate Outcome 10 created for the Indicator: A modern mining cadaster is in below) mining sector. Original Indicator revised place. and captured as new milestone. (vi) Better Statistical System (iv) Improved Statistical System. The Indicator is revised for improved Management. Revised (Indicator 28): World Bank specificity and measurability. Indicator: Key data produced in a timely Statistical Capacity Indicator Score (SCI) manner. increased from 50 (2012) to 55 (2017) Milestone: National Statistics Institute Dropped. Delays in project effectiveness and evaluation of capacity made in 2013. implementation make it unlikely that these Milestone: Preparation of two key sectors Dropped Milestones will be achieved during the data development strategies in 2014. CPS period. (vii) Better Timber Export Management. Dropped. Restructuring of the Forestry and Indicator: Percentage of timber exports Economic Diversification project is covered by a Forest Law Enforcement addressing problems of coordination between development partners and an 35 Original CPS Results Matrix Updated CPS Results Matrix Comments Governance and Trade (FLEGT) legality overly-ambitious project design with so license increased to 70%. many activities that it jeopardized achievement of results. The outcome goal for this area has been dropped while the project is being restructured. Milestone: Revised forest law Dropped. As above. incorporating FLEGT regulatory framework adopted. Dropped. Milestone: National timber tracking and legality verification systems fully operational. Outcome 10: Improved Institutional Separate new Outcome 10 created given Framework for the Management of the the importance of the sector. Mining Sector (i) Better Mining Sector Management. Aligned with new Outcome 10. New Indicator 30: A revised mining code in line with international good practices is adopted (2017) New Milestone: A roadmap for putting Previous Indicator (“A modern mining in place a modern mining cadaster has cadaster is in place”) revised and made been developed and capacity of relevant more specific and realistic as a Milestone. government authorities has been built. 36 Annex 3: Republic of Congo: Results Matrix: Progress towards CPS Objectives CPS Outcomes and Indicators Milestones WBG Instruments I. WBG Pillar: Competitiveness and Employment Outcome 1.1: Improved Investment Programming and Infrastructure Management (i) Better Project Selection.  Fonds d’études is fully operational Closed Project: and the capacity of government staff  Transparency and Governance Indicator: At least 50% of government responsible for project appraisal is Repeat Project projects, each in excess of FCFA 250 million, reinforced. (On track) have a feasibility study prior to incorporation  Training program for staff involved Completed ASA/TA: into the budget. (On track) in public procurement process is in  EW PEMFAR place and implemented. (On track) Progress:  National budget for 2013/14 has been Progress: prepared in accordance with the MTEF.  The Fonds d’études is in place, but  55 percent of the investment projects for still not yet fully operational. which feasibility study has been prepared.  The National training program on  70 percent of the investment budget is public procurement is in place since implemented. 2011. The contract is expected to be signed in December 2014 and the implementation is scheduled to start in February 2015. (ii) Better Budget Planning.  Strategies for key sectors are Closed Project: updated. (Off track)  Transparency and Governance Indicator: The global/ government-wide  Macroeconomic data for all sectors Repeat Project MTEF is fully operational. (Off Track) are updated in order to prepare a suitable medium term expenditure Completed ASA/TA: Note: The indicator has been dropped. (See framework starting with 2013  EW PEMFAR Annex 2). budget. (Off track) (iii) Improved Operational and Financial  Action Plan for the reform of the Ongoing Financing: Performance of Energy Utility. power utility (Société Nationale  Water, Electricity and Urban d’Electricité) is completed and Development Project 37 CPS Outcomes and Indicators Milestones WBG Instruments Indicator: Revenue collected per kilowatt approved by the Government. (On hour delivered to the Brazzaville distribution track) IFC: network increases by 10% from 2012 level.  IFC PPP transaction on Sounda Dam (On track) Progress:  The Government contracted Ongoing ASA/TA: Note: The indicator has been revised. (See Electricite de France (EDF) to help  TA Gas Market Development Annex 2). define a strategy to improve commercial performance of the power utility (Société Nationale d’Electricité (SNE). Nothing has been done so far yet but the AF of the current project will scale up activities to enhance SNE’s technical and managerial capacity. (iv) Improved Operational and Financial  New water legal and regulatory Ongoing Financing: Performance of Water Utility. framework fully defined and  Water, Electricity and Urban enforced. (Off track) Development Project Indicator 1: Connections with operating water  Water service contract in place. meter in Brazzaville up from 4% to 30%, and (Achieved) in Pointe Noire from 37% to 53%. (On track) Progress: Note: Baseline and target have been revised,  Water service contract in place. The (See Annex 2) Private Operator has been recruited and the water service contract is in Indicator 2: Collection ratio (cash income per place and is functioning well. billed revenue) increases from 47% (2010) to 70% (2016). (On track) Progress:  As of now the collection rate is 56% and is expected to increase quickly due to the presence of the Private Operator. 38 CPS Outcomes and Indicators Milestones WBG Instruments (v) Increase in Railway Traffic.  CFCO 5-year business plan Ongoing Financing: approved by Management.  Support to Economic Diversification Indicator: CFCO traffic increases from 0.8 (Achieved) Project million tons (2010) to 1.0 million tons (2016).  Forestry and Economic (Achieved) Progress: Diversification Project  CFCO 5-year business plan was Progress: approved by management in 2012.  CFCO traffic was in excess of 1.2 million tons in 2013 Outcome 1.2: Improved Business Climate (i) Faster Business Registration.  The one-stop window is effective Ongoing Financing: with an information technology  Support to Economic Diversification Indicator: Number of procedures to start a system designed and implemented to Project business reduced from 10 (2010) to 5 (2016). interconnect the five (5) nationwide (On track) CFE agencies among themselves Ongoing ASA/TA: and with all contributing  EW Policy Note on Economic Progress: government agencies to streamline Diversification  This outcome is on track to be achieved as the business registration process. the reforms have already been adopted and (On track) are under implementation.  As of now the Government has adopted 6 Progress: out of 26 new reforms in the areas of  A diagnostics study was completed reducing time to register new business, that assessed the one-stop-shop streamlining and reducing tax payments processes with recommendations. and trading across borders. Capacity building is underway to  Major implementation constraints are lack reinforce the integration of all of prompt collaboration among agencies into the one-stop-shop, and stakeholder’s ministries which delay the an IT firm has been recruited to process unduly. design and implement the IT system that will support the effective operationalization of the one stop shop. 39 CPS Outcomes and Indicators Milestones WBG Instruments (ii) Reduced Time to Export Goods.  The import and export one stop shop Ongoing Financing: is operational. (Achieved)  Support to Economic Diversification Indicator: The time to export goods reduced Project from 50 (2010) to 20 days (2016). (On track) Progress:  A maritime one-stop-shop window Completed ASA/TA: Progress: was set up at the port of Pointe  EW Trade Facilitation and  This outcome is on track to be achieved as Noire and is being operationalized. Intervention the reforms have already been adopted and under implementation. Ongoing ASA/TA:  By 2016 or 2017, it will be possible to  EW Policy Note on Economic reduce the time to 20 days. The reductions Diversification were mentioned in the Law of Finance 2013. (iii) Reduced Time to Import Goods.  The import and export one stop shop Ongoing Financing: is operational. (Achieved)  Support to Economic Diversification Indicator: The time to import goods reduced Project from 62 days (2010) to 30 days (2016). (On Progress: track)  A maritime one-stop-shop window Completed ASA/TA: was set up at the port of Pointe  EW Trade Facilitation and Progress: Noire and is being operationalized. Intervention  This outcome is on track to be achieved as the reforms have already been adopted and Ongoing ASA/TA: under implementation.  EW Policy Note on Economic  As of now the Government has adopted 6 Diversification out of 26 new reforms in the areas of reducing time to register new business, streaming and reducing tax payments and trading across borders. (iv) Streamlined Tax System.  Streamlined tax framework adopted. Ongoing Financing: (On track)  Support to Economic Diversification Project 40 CPS Outcomes and Indicators Milestones WBG Instruments Indicator: The number of tax payments Progress: Completed ASA/TA: reduced from 61 (2010) to below the Sub-  Several tax reforms have been made  EW PEMFAR Saharan average of 30 (2016). (On track) as part of the 2012, 2013 Finance Law which suppressed tax payments Ongoing ASA/TA: Progress: on the one hand, and consolidated  EW Policy Note on Economic  Currently, there are 50 payments, meaning others. Diversification that the number of payments has to decrease annually until 2016 or to reduce directly to the target.  Implementation of some of the reforms may find resistance in various ministries as this will cut into significant revenue source. RoC has to be aggressive in the implementation process. (v) Supported SMEs.  A “train-the-trainer” program is set Ongoing Financing: up to help build the capabilities and  Support to Economic Diversification Indicator: Support the development of help professionalize 120-150 of Project national database of nonfinancial services these non-financial services providers accessible by SMEs nationwide providers. (On track) IFC: through the CFE and ultimately the MEC. (On  IFC Advisory: IFC Risk Sharing track) Facility combined with Business Edge SME Training Toolkit Note: The indicator has been revised. (See Annex 2). Ongoing ASA/TA:  TA Sovereign Wealth Fund (RAS) Progress:  EW Policy Note on Economic  As part of PADE’s Matching Grant, a Diversification dynamic database of non-financial service  Financial Sector Development providers has been set up. Strategy  The database currently has in excess of 50 non-financial service providers. The 41 CPS Outcomes and Indicators Milestones WBG Instruments database will be transferred to the Ministry of SME at project close in 2.5 years.  One of the risks is that the database currently being created by the project will be managed ultimately by the Government and may not be efficient. (vi) Attracted Investment in Other Potential  2–4 investment promotion activities Ongoing Financing: Sectors. a year organized for the next 3 years  Support to Economic Diversification to educate and attract potential Project Indicator: Increased investments in investors in key priority value agribusiness, transit related services, wood chains. 12-15 anchor investors (from Ongoing ASA/TA: transformation and mining. (Off track) project inception to realization) in  TA Sovereign Wealth Fund (RAS) the agribusiness value chains  EW Policy Note on Economic Note: The indicator has been dropped. (See including palm oil, horticulture, corn Diversification Annex 2). and cassava supported. (On track)  PA Helping Increase VFM of Investments Progress:  4 investment promotion events planned for the next 6 months (USA, France, UAE, Spain) one of which has been realized (USA). Strategic partners in these target countries are helping to build an optimal portfolio of anchor investors on the basis of turnkey projects. (vii) Broadened the Types of Support to  250-300 SMEs supported with Ongoing Financing: Private Enterprises. capacity building programs to  Support to Economic Diversification improve managerial capabilities and Project Indicator: Improved SME access to non- productivity in the agribusiness, financial services. (On track) transit, and wood transformation IFC: sectors. The development of domestic non-financial services 42 CPS Outcomes and Indicators Milestones WBG Instruments Note: The indicator has been dropped. (See supported with training programs for  IFC Advisory: IFC Risk Sharing Annex 2). 120-150 services providers with the Facility combined with Business development of a national database. Edge SME Training Toolkit (On track) Ongoing ASA/TA: Progress:  TA Sovereign Wealth Fund (RAS)  The ongoing program (PADE)  EW Policy Note on Economic currently has over 180 SMEs across Diversification 7 value chains that will benefit from capacity building programs in 6 sectors. It is expected that the project will support more than 500 SMEs by the time it closes in 2.5 years.  Partner bank identified to finance portfolio of local SMEs working with TOTAL Congo. Risk Sharing Agreement to be signed in Q1-2015 (initial pilot of up to 30 SMEs in TOTAL Congo Value Chain). (IFC activities) Outcome 1.3: Improved Regional Telecommunications (i) Higher Volume of International  Regional and international optical Ongoing Financing: Telecomm Traffic (international internet fiber connections installed. (On  Central African Backbone Project - bandwidth). track) APL3 Indicator: Bits per second increase from 75 Progress: (2012) to 200 (2016). (Achieved)  The milestone is on track to be achieved with the implementation of Progress: the largest project contract (70% of  The outcome indicator has achieved its the CAB project total cost). The target of 200 bits per second. contract has been awarded and 43 CPS Outcomes and Indicators Milestones WBG Instruments  The project implementation has been construction of the fiber optic link efficient (ratio-cost-outputs) and the between Pointe-Noire and Mbinda implementation efficiency has been will start mid-December, 2015 and satisfactory. Although the disbursement will last 12 months. may be slow, this is mainly due to one contract (construction of fiber optic infrastructure) which is now under implementation. Disbursement is expected to increase significantly over the next 12 months to reach 50 percent by June 2015 and more than 70% in September 2015. Outcome 1.4: Improved Agricultural Production (i) Improved Market Access.  1,000 km of priority roads Ongoing Financing: rehabilitated. (Achieved)  Agriculture Development and Rural Indicator: Transportation time in areas with  Market access improved in areas Roads Rehabilitation Project rehabilitated rural roads reduced by at least with built market infrastructure (18 30%. (On track) markets with the ongoing project). (Achieved) Note: The indicator has been revised. (See Annex 2). Progress:  1,251 km of rural roads rehabilitated out of 1,321 km planned.  36 market infrastructures completed and used out of 24 planned.  About 48 percent of the farmers in targeted zones now have more efficient production and processing technologies. (ii) Increase Food Production.  30% of farmers in targeted zones Ongoing Financing: adopt improved technologies  Agriculture Development and Rural Indicator: Increase food production in (seeds). (Achieved) Roads Rehabilitation Project targeted zones by 20%. (On track) 44 CPS Outcomes and Indicators Milestones WBG Instruments Progress: Note: The indicator has been revised. (See  48% of farmers in targeted zones Annex 2). adopted improved production and processing technologies (as of December 31, 2013). II. WBG Pillar: Vulnerability and Resilience Outcome 2.1: Better Health Outcomes (i) Better Protection Against Malaria.  Insecticide and treated nets Closed Project: distribution to households.  Health Sector Services Development Indicator: Percentage of children under five (Achieved) Project years of age sleeping under an insecticide-  Transparency and Governance treated net the previous night increases from Progress: Repeat Project 67% in 2011 to 80% in 2015. (Achieved)  700,000 bed-nets were distributed to households by June 2014. Ongoing Financing: Progress:  Health Sector Project  80.9% of children slept under an insecticide treated bed net as of June 2014. Completed ASA/TA: This has exceeded the target.  EW HD Sector PER Ongoing ASA/TA:  Impact Evaluation of Performance Based Financing (ii) Higher Immunization Rates.  Capacity building for immunization Closed Project: carried out, and the vaccine  Health Sector Services Development Indicator: Percentage of children fully distribution system operational and Project immunized for Penta3 (DTP, Hep. B, and approved. (On track)  Transparency and Governance Hemovirus) increases from 65% (2013) to Repeat Project 75% (2016). (On track) Ongoing Financing: Progress:  Health Sector Project  72% children were fully immunized for Penta3 as of June 2014. Completed ASA/TA: 45 CPS Outcomes and Indicators Milestones WBG Instruments  EW HD Sector PER Ongoing ASA/TA:  Impact Evaluation of Performance Based Financing (iii) Higher Professionally Aided Delivery.  Equipment of Health Centers and Closed Project: retraining staff are completed. (On  Health Sector Services Development Indicator: Percentage of births attended by track) Project skilled health personnel increases from 93.6%  Transparency and Governance in 2011 to 97% by 2015. (Off track) Progress: Capacity Building Project II  32 health facilities rehabilitated and Progress: equipped (100% of the target). Ongoing Financing:  93.6% of births were assisted by skilled  Health Sector Project personnel as of June 2014. Completed ASA/TA:  EW HD Sector PER Ongoing ASA/TA:  Impact Evaluation of Performance Based Financing Outcome 2.2: Better Education Outcomes (i) Maintain or Increase High Primary  Action plans to improve school Closed Project: Completion Rates. access and retention for children  Support to Basic Education Project living in underserved and  Transparency and Governance Indicator: Increase primary completion from disadvantaged areas are developed Repeat Project 83% in 2010/2011 school year to 90% by (2013) and implemented. Annual 2015/16. (Off track) reviews are completed. (Dropped) Completed ASA/TA:  Learning assessment is organized  EW HD Sector PER Note: The indicator has been dropped. (See periodically and actions developed Annex 2). to address observed shortcomings (as of 2013). (Dropped) 46 CPS Outcomes and Indicators Milestones WBG Instruments (ii) Improved Girl-boy Ratio.  Targeted programs for girls’ Closed Project: education put in place in 2014.  Support to Basic Education Project Indicator: Increase in girl-boy ratio of primary (Dropped)  Transparency and Governance school enrollment from 97% in 2010/11 to  Performance-based management Repeat Project 100% in 2015/16. (Off track) system introduced and gradually extended (as of 2014). (Dropped) Completed ASA/TA: Note: The indicator has been dropped. (See  EW HD Sector PER Annex 2). III. WBG Pillar: Capacity Building and Governance Outcome 3.1: Improved Transparency and Accountability (i) More Competitive Procurement.  Annual training programs of Closed Project: procurement staff in the ministries  Transparency and Governance Indicator: At least 80% of public contracts in are completed on time. (On track) Repeat Project excess of FCFA 250 million are subjected to  Production of annual procurement competitive bidding (from the current 60%). audit reports six (6) months after the Completed ASA/TA: (On track) end of the budget year. (On track)  TA Use of Country System  EW PEMFAR Progress: Progress:  The outcome indicator target for 80% may  The National training program on be achieved by 2016. Overall 79 percent of public procurement prepared by contracts (in number) equivalent to 94 ARMP is in place since 2011 and its percent in amount, have been awarded implementation is scheduled to start following competitive bidding (2014). in February 2015. The contract is expected to be signed in December 2014.  The first annual audit has been conducted in 2013 for 2012 budget. The report is disseminated in September 2014.  For the 2013 budget, the contract of the auditor is signed. 47 CPS Outcomes and Indicators Milestones WBG Instruments  The sampling of the 2013 audit did not cover contracts above FCA 1 billion. (ii) Better Budget Management.  Automatic budget execution system Closed Project: with habilitation to reject all  Transparency and Governance Indicator: Deviation between actual and overruns in place and functioning. Repeat Project budgeted expenditure by targeted ministries Staff trained in the use of this reduced from 40% (2011) to less than 10% system. (On track) Completed ASA/TA: (2015). (On track)  EW PEMFAR Progress:  EW Economic Update (various Progress:  The implementation of the automatic editions)  Deviation between actual and budgeted budget execution is ongoing and will expenditure reduced from 40% to 30%. be completed by June 2015. Ongoing ASA/TA:  EW Economic Updates (iii) Greater Government Transparency.  Annual Training program developed Closed Project: and implemented. (Achieved)  Transparency and Governance Indicator: Annual report of the Supreme Repeat Project Audit Authority and the State General Inspectorate are publicly available. (Achieved) Completed ASA/TA:  EW PEMFAR Progress:  Reports of the Supreme Audit Authority and the State General Inspectorate have been published by the end of 2013. (iv) Improvement in Petroleum Revenue  Attain EITI Validation. (Off track) Closed Project: Transparency and Governance of Sector  Timely publication of SNPC audit  Transparency and Governance Institutions. reports. (Off track) Repeat Project  Timely publication of quarterly oil Indicator: Attain EITI compliance and remain revenue reports. (Off track) Completed ASA/TA: compliant. (On track)  EW PEMFAR 48 CPS Outcomes and Indicators Milestones WBG Instruments Note: The indicator has been dropped. (See Annex 2). Progress:  The Bank program currently is not supporting any activities. (v) Better Mining Sector Management.  Analytical work on mining code and Ongoing ASA/TA: advice on geo-data management  TA Mining Dialogue Indicator: A modern mining cadaster is in provided. (On track)  EW Balancing Mining and Forest place. (Off track)  Legal and institutional frameworks Conservation in the Congo Basin strengthened. (On track) Note: The indicator has been revised. (See  Guidelines to optimize mining Annex 2). benefits and social safeguards adopted. (On track) Progress:  The current TF is expected to close in Progress: 2015. It is highly unlikely if the specific  A mining code has been revised and outcome indicator will be achieved. new draft is expected in 2015. (vi) Better Statistical System Management.  National Statistics Institute Ongoing Financing: evaluation of capacity made in 2013.  Statistics Capacity Building Project Indicator: Key data produced in a timely (Off track) manner.  Preparation of two key sectors data (Off track) development strategies in 2014. (Off track) Note: The indicator has been revised. (See Annex 2). Progress:  The work has not started as the project is still not effective. 49 CPS Outcomes and Indicators Milestones WBG Instruments (vii) Better Timber Export Management.  Revised forest law incorporating Ongoing Financing: FLEGT regulatory framework  Forestry and Economic Indicator: Percentage of timber exports adopted. (On track) Diversification Project covered by a Forest Law Enforcement  National timber tracking and legality Governance and Trade (FLEGT) legality verification systems fully Ongoing ASA/TA: license increased to 70%. (Off track) operational. (Off track)  EW Balancing Mining and Forest Conservation in the Congo Basin Note: The indicator has been dropped. (See Progress: Annex 2).  The Forest Law has been revised (and will be soon adopted by Progress: parliament).  The indicator has been dropped and may  National timber tracking system is be revisited base on the restructuring of the not yet in place and the ongoing project. program is not tracking the system.  The ongoing project is being restructured and it is not currently financing the timber tracking system.  The project became effective with a nine month delay and some project activities were not adequately defined before effectiveness. In addition, design of the project was overly ambitious. 50 Annex 4: Republic of Congo: Macroeconomic Indicators (2012-2017) Growth rate (%) unless otherwise mentioned Actual Estimate Projected Indicators 2012 2013 2014 2015 2016 2017 GDP at constant market prices 3.8 3.4 6.4 1.3 3.5 5.6 Private consumption 6.9 8.7 4.4 2.5 4.6 4.6 Government consumption 17.4 10.4 5.0 -2.5 2.0 4.9 Gross fixed capital investment 7.3 3.2 10.3 -4.1 2.3 1.3 Change in inventories (% of contribution) -3.4 -5.7 4.1 -4.5 7.0 10.0 Exports, Goods and Services 26.3 5.2 6.6 -6.0 4.0 3.0 Imports, Goods and Services 3.8 3.4 6.4 1.3 3.5 5.6 GDP at constant factor prices 3.6 3.4 6.3 1.3 3.6 5.6 Agriculture 7.8 8.5 8.2 5.0 4.0 4.0 Manufacturing 8.7 8.9 7.6 4.3 3.4 5.1 Services 10.1 8.0 7.3 1.8 2.4 4.3 Oil GDP -9.6 -10.0 3.1 -4.0 7.0 10.0 Non-oil GDP 9.7 8.1 7.4 2.8 2.5 4.6 Inflation (household consumption deflator) 4.4 -2.1 -4.2 -25.7 3.4 4.9 Inflation (consumer price index) 3.9 6.0 0.9 0.9 1.7 2.5 Current Account Balance (% of GDP) -1.3 -5.2 -6.1 -16.2 -14.1 -10.7 Fiscal Balance (% of GDP) 6.5 5.8 -6.1 -12.3 -8.9 -7.2 Source: WBG staff estimates and official data. 51 Annex 5: Operational Portfolio Annex 5: Congo, Republic of Operations Portfolio (IBRD/IDA and Grants) As Of Date 10/7/2015 Closed Projects 33 IBRD/IDA * Total Disbursed (Active) 58.70 of w hich has been repaid 0.00 Total Disbursed (Closed) 226.41 of w hich has been repaid 54.53 Total Disbursed (Active + Closed) 285.11 of w hich has been repaid 54.53 Total Undisbursed (Active) 97.80 Total Undisbursed (Closed) 0.00 Total Undisbursed (Active + Closed) 97.80 Active Projects Difference Between Last PSR Expected and Actual Supervision Rating Original Amount in US$ Millions Disbursements a/ Developmen Implementation Project ID Project Name Fiscal Year IBRD IDA GRANT Cancel. Undisb. Orig. Frm Rev'd t Objectives Progress P143849 CG Health Sector Project MS MS 2014 10.0 8.613 2.447 P128628 CG Skills Development for Employability MS MS 2014 10.0 8.650 2.698 P118561 CG Support to Economic Diversification MS MS 2011 10.0 5.560 6.349 3.724 P095251 CG-Agr Rehab SIL (FY07) MS MS 2007 22.5 1.659 -1.590 P133731 CG-Statistics Capacity Building Project MS MS 2014 4.8 4.012 P106975 CG-Water, Electricity & Urban Dev. SIL S S 2010 45.0 40.5 61.618 3.497 P124085 Forestry & Economic Diversification Project MS MU 2012 10.0 6.652 3.862 P145263 LISUNGI - Safety Nets Project S S 2014 2.0 1.039 Overall Result 45.0 109.8 97.803 15.981 3.724 52 Annex 6: Selected Indicators of Bank Portfolio Annex 6: Congo, Republic of Selected Indicators* of Bank Portfolio Performance and Management As Of Date 10/7/2015 Indicator/FY 2013 2014 2015 2016 Portfolio Assessment Number of Projects Under Implementation a 6 9 8 8 Average Implementation Period (years) b 3.2 2.3 3.3 3.6 Percent of Problem Projects by Number a, c 33.3 22.2 12.5 12.5 Percent of Problem Projects by Amount a, c 18.1 15.0 6.5 6.5 Percent of Projects at Risk by Number a, d 66.7 66.7 75.0 75.0 Percent of Projects at Risk by Amount a, d 58.8 59.6 84.2 84.2 Disbursement Ratio (%) e 37.0 35.5 21.6 1.6 Portfolio M anagement 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 IEG by Number 24 3 Proj Eval by IEG by Amt (US$ millions) 591.9 95.2 % of IEG Projects Rated U or HU by Number 65.2 33.3 % of IEG Projects Rated U or HU by Amt 73.0 23.4 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. 53